Document:

EXHIBIT 10.1

 

EXECUTION VERSION

 

CREDIT AGREEMENT

 

among

 

MTR GAMING GROUP, INC.,

as the Borrower

 

CERTAIN SUBSIDIARIES OF THE BORROWER,

as Guarantors

 

THE LENDERS SIGNATORY HERETO

 

and

 

ALADDIN CREDIT ADVISORS, L.P.,

as Administrative Agent

 

Dated as of March 18, 2010

 

 

TABLE OF CONTENTS

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  ARTICLE I Defined Terms

  	
  1

  
	
  Section 1.1.

  	
  Definitions

  	
  1

  
	
  Section 1.2.

  	
  Accounting
  Terms

  	
  27

  
	
   

  	
   

  	
   

  
	
  ARTICLE II Term Loans

  	
  28

  
	
  Section 2.1.

  	
  Term
  Loans

  	
  28

  
	
  Section 2.2.

  	
  [Reserved]

  	
  28

  
	
  Section 2.3.

  	
  Borrowing
  Mechanics

  	
  28

  
	
  Section 2.4.

  	
  Pro
  Rata Shares

  	
  29

  
	
  Section 2.5.

  	
  Use
  of Proceeds

  	
  29

  
	
  Section 2.6.

  	
  Evidence
  of Debt; Register; Notes

  	
  29

  
	
  Section 2.7.

  	
  Interest

  	
  30

  
	
  Section 2.8.

  	
  Fees

  	
  32

  
	
  Section 2.9.

  	
  Repayment

  	
  32

  
	
  Section 2.10.

  	
  Optional
  Prepayments

  	
  32

  
	
  Section 2.11.

  	
  Mandatory
  Prepayments; Mandatory Commitment Reductions

  	
  33

  
	
  Section 2.12.

  	
  Application
  of Payments

  	
  34

  
	
  Section 2.13.

  	
  General
  Provisions Regarding Payments

  	
  35

  
	
  Section 2.14.

  	
  Ratable
  Sharing

  	
  36

  
	
  Section 2.15.

  	
  Conversion
  and Continuation of Term Loans

  	
  37

  
	
   

  	
   

  	
   

  
	
  ARTICLE III Conditions Precedent

  	
  37

  
	
  Section 3.1.

  	
  Conditions
  Precedent; Closing Date

  	
  37

  
	
  Section 3.2.

  	
  Conditions
  to all Term Loans

  	
  42

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV Representations and Warranties

  	
  42

  
	
  Section 4.1.

  	
  Representations
  and Warranties

  	
  42

  
	
   

  	
   

  	
   

  
	
  ARTICLE V Affirmative Covenants

  	
  50

  
	
  Section 5.1.

  	
  Basic
  Reporting Requirements

  	
  50

  
	
  Section 5.2.

  	
  Visitation;
  Verification

  	
  51

  
	
  Section 5.3.

  	
  Maintenance
  of Properties

  	
  52

  
	
  Section 5.4.

  	
  Notice
  of Material Events

  	
  52

  
	
  Section 5.5.

  	
  Use
  of Proceeds

  	
  52

  
	
  Section 5.6.

  	
  Further
  Assurances

  	
  53

  
	
  Section 5.7.

  	
  [Reserved]

  	
  53

  
	
  Section 5.8.

  	
  Insurance

  	
  53

  
	
  Section 5.9.

  	
  Information
  Regarding Collateral

  	
  53

  
	
  Section 5.10.

  	
  Existence;
  Conduct of Business

  	
  54

  
	
  Section 5.11.

  	
  Payment
  of Obligations

  	
  54

  
	
  Section 5.12.

  	
  Compliance
  with Laws

  	
  54

  
	
  Section 5.13.

  	
  Subsidiaries

  	
  54

  

 

i

 

	
  Section 5.14.

  	
  Guarantors

  	
  54

  
	
  Section 5.15.

  	
  Real
  Property

  	
  55

  
	
  Section 5.16.

  	
  Broker’s
  Claims

  	
  55

  
	
  Section 5.17.

  	
  Compliance
  with ERISA

  	
  55

  
	
  Section 5.18.

  	
  Consents
  of and Notices to Gaming Authorities

  	
  56

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI Negative Covenants

  	
  56

  
	
  Section 6.1.

  	
  Indebtedness

  	
  56

  
	
  Section 6.2.

  	
  Liens

  	
  58

  
	
  Section 6.3.

  	
  Sales
  and Lease-Backs

  	
  61

  
	
  Section 6.4.

  	
  Transactions
  with Shareholders and Affiliates

  	
  61

  
	
  Section 6.5.

  	
  Investments

  	
  61

  
	
  Section 6.6.

  	
  [Reserved]

  	
  62

  
	
  Section 6.7.

  	
  Merger;
  Disposition of Assets; Acquisitions

  	
  62

  
	
  Section 6.8.

  	
  Fiscal
  Year; Fiscal Quarter

  	
  63

  
	
  Section 6.9.

  	
  Restricted
  Payments

  	
  63

  
	
  Section 6.10.

  	
  Subsidiaries

  	
  64

  
	
  Section 6.11.

  	
  Conduct
  of Business

  	
  64

  
	
  Section 6.12.

  	
  Restrictions
  on Subsidiary Distributions

  	
  64

  
	
  Section 6.13.

  	
  Amendments
  to Organizational Documents, Senior Secured Notes Indenture and Senior
  Subordinated Notes Indenture

  	
  64

  
	
  Section 6.14.

  	
  Financial
  Covenants

  	
  65

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII Increased Costs; Taxes;
  Indemnification; Set Off; Etc.

  	
  68

  
	
  Section 7.1.

  	
  Increased
  Costs; Capital Adequacy

  	
  68

  
	
  Section 7.2.

  	
  Taxes;
  Withholding, etc.

  	
  68

  
	
  Section 7.3.

  	
  Indemnification

  	
  70

  
	
  Section 7.4.

  	
  Right
  of Set Off

  	
  71

  
	
  Section 7.5.

  	
  Funding
  Breakage

  	
  72

  
	
  Section 7.6.

  	
  Booking
  of LIBOR Loans

  	
  72

  
	
  Section 7.7.

  	
  Inability
  to Determine LIBOR

  	
  72

  
	
  Section 7.8.

  	
  Assignment
  of Loans Under Certain Circumstances; Duty to Mitigate

  	
  72

  
	
   

  	
   

  	
   

  
	
  ARTICLE VIII Events of Default

  	
  73

  
	
  Section 8.1.

  	
  Events
  of Default

  	
  73

  
	
  Section 8.2.

  	
  Remedies

  	
  76

  
	
   

  	
   

  	
   

  
	
  ARTICLE IX Administrative Agent

  	
  77

  
	
  Section 9.1.

  	
  Appointment
  of Administrative Agent

  	
  77

  
	
  Section 9.2.

  	
  Powers
  and Duties

  	
  77

  
	
  Section 9.3.

  	
  Delegation
  of Duties

  	
  78

  
	
  Section 9.4.

  	
  General
  Immunity

  	
  78

  
	
  Section 9.5.

  	
  Administrative
  Agent Entitled to Act with the Borrower

  	
  79

  
	
  Section 9.6.

  	
  Lenders’
  Representations, Warranties and Acknowledgment

  	
  79

  
	
  Section 9.7.

  	
  Right
  to Indemnity

  	
  80

  
	
  Section 9.8.

  	
  Successor
  Administrative Agent

  	
  80

  
	
  Section 9.9.

  	
  Security
  Documentation

  	
  81

  

 

ii

 

	
  Section 9.10.

  	
  Notice
  of Default

  	
  82

  
	
  Section 9.11.

  	
  Delivery
  of Documents, Notices, Etc.

  	
  82

  
	
   

  	
   

  	
   

  
	
  ARTICLE X Miscellaneous

  	
  82

  
	
  Section 10.1.

  	
  Amendments
  and Waivers

  	
  82

  
	
  Section 10.2.

  	
  Notices

  	
  84

  
	
  Section 10.3.

  	
  Expenses

  	
  85

  
	
  Section 10.4.

  	
  Enforceability;
  Successors and Assigns

  	
  85

  
	
  Section 10.5.

  	
  Lenders’
  Obligations Several; Independent Nature of Lenders’ Rights

  	
  88

  
	
  Section 10.6.

  	
  Integration

  	
  88

  
	
  Section 10.7.

  	
  No
  Waiver; Remedies

  	
  88

  
	
  Section 10.8.

  	
  Submission
  to Jurisdiction

  	
  88

  
	
  Section 10.9.

  	
  Execution
  in Counterparts

  	
  88

  
	
  Section 10.10.

  	
  Governing
  Law

  	
  88

  
	
  Section 10.11.

  	
  Waiver
  of Jury

  	
  89

  
	
  Section 10.12.

  	
  Severability

  	
  89

  
	
  Section 10.13.

  	
  Survival

  	
  89

  
	
  Section 10.14.

  	
  Maximum
  Lawful Interest

  	
  89

  
	
  Section 10.15.

  	
  Interpretation

  	
  90

  
	
  Section 10.16.

  	
  Ambiguities

  	
  90

  
	
  Section 10.17.

  	
  First
  Lien Obligations

  	
  90

  
	
  Section 10.18.

  	
  Confidentiality

  	
  90

  
	
  Section 10.19.

  	
  Additional Gaming Provisions

  	
  91

  

 

	
  Exhibit A-1:

  	
   

  	
  Form of
  Borrowing Certificate

  
	
  Exhibit A-2:

  	
   

  	
  Form of
  Conversion/Continuation Notice

  
	
  Exhibit B:

  	
   

  	
  Form of
  Note

  
	
  Exhibit C:

  	
   

  	
  Form of
  Guaranty

  
	
  Exhibit D:

  	
   

  	
  Form of
  Joinder

  
	
  Exhibit E:

  	
   

  	
  Form of
  Compliance Certificate

  
	
  Exhibit F:

  	
   

  	
  Form of
  Security Agreement

  
	
  Exhibit G:

  	
   

  	
  Form of
  Mortgage

  
	
  Exhibit H:

  	
   

  	
  [Reserved]

  
	
  Exhibit I:

  	
   

  	
  MPI
  Real Property

  
	
  Exhibit J:

  	
   

  	
  PIDI
  Real Property

  
	
  Exhibit K:

  	
   

  	
  SDI
  Real Property

  
	
  Exhibit L:

  	
   

  	
  Form of
  Stock Pledge Agreement

  
	
  Exhibit 3.1(k):

  	
   

  	
  Form of
  Closing Date Certificate

  
	
  Exhibit 3.1(l):

  	
   

  	
  Form of
  Solvency Certificate

  
	
  Exhibit 10.4(b):

  	
   

  	
  Form of
  Assignment Agreement

  
	
   

  	
   

  	
   

  
	
  Schedule
  2.1

  	
   

  	
  Term
  Loan Commitments

  
	
  Schedule
  3.1(r)

  	
   

  	
  Closing
  Date Mortgaged Properties

  
	
  Schedule
  4.1(c)

  	
   

  	
  Real
  Property

  
	
  Schedule
  4.1(j)

  	
   

  	
  Partnerships

  

 

iii

 

	
  Schedule
  4.1(m)

  	
   

  	
  Beneficial
  Owners of Capital Stock

  
	
  Schedule
  4.1(p)

  	
   

  	
  Employee
  Benefit Plans

  
	
  Schedule
  4.1(s)

  	
   

  	
  Intellectual
  Property

  
	
  Schedule
  4.1(v)

  	
   

  	
  Material
  Contracts

  
	
  Schedule
  4.1(w)

  	
   

  	
  Broker’s
  Fees

  
	
  Schedule
  4.1(bb)

  	
   

  	
  Business
  on Non-Core Land/Unrestricted Subsidiary Transactions

  
	
  Schedule
  6.1

  	
   

  	
  Existing
  Indebtedness

  
	
  Schedule
  6.2

  	
   

  	
  Existing
  Liens

  
	
  Schedule
  6.5

  	
   

  	
  Existing
  Investments

  

 

iv

 

CREDIT AGREEMENT, dated as
of March 18, 2010, among MTR GAMING GROUP, INC.,
a Delaware corporation (the “the Borrower”),
CERTAIN SUBSIDIARIES OF MTR GAMING GROUP, INC. listed
on the signature pages hereto, as guarantors (each a “Guarantor”
and collectively the “Guarantors”),
the lenders signatory hereto (together with any other financial institutions or
investors from time to time as lenders hereunder, the “Lenders”),
and ALADDIN CREDIT ADVISORS, L.P., a
Delaware limited partnership, as administrative agent (“Aladdin”
and, in such capacity, the “Administrative Agent”).

 

RECITALS

 

WHEREAS, the Borrower
has requested, and the Lenders have agreed to provide (a) a senior, first
priority secured delayed-draw Term Loan facility (subject to Permitted Liens)
and (b) other financial accommodations as set forth herein, but, in each
case, only to the extent and on the conditions set forth herein;

 

WHEREAS, the Term Loan
facility will constitute a Refinancing (as defined in the Intercreditor
Agreement) of the indebtedness under the Existing Agreement;

 

WHEREAS, the liens
securing the Term Loan facility will be subject to the terms of the
Intercreditor Agreement; and

 

WHEREAS, the Borrower
will use the proceeds of the Term Loans (a) to finance ongoing working
capital and general corporate needs of the Borrower and its Subsidiaries, (b) to
finance capital expenditures (including the potential development of the Scioto
Downs complex in Columbus, Ohio and the development of the Presque Isle Downs
complex for table games in Erie, Pennsylvania) and (c) to pay transaction
fees and expenses in respect of this Agreement and the transactions
contemplated hereby.

 

NOW  THEREFORE, in consideration of the premises and the mutual
covenants and the agreements herein set forth, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto, intending to be legally bound, agree as follows:

 

ARTICLE I

Defined Terms

 

Section 1.1.           Definitions.  As used in this Agreement, including, without
limitation, the preamble, recitals, exhibits and schedules hereto, the
following terms have the meanings stated:

 

“Account”  has the meaning assigned to such term in the UCC as adopted
and in effect in the State of New York.

 

“Action”
against a Person means an action, suit, litigation, arbitration, investigation,
complaint, contest, hearing, inquiry, inquest, audit, examination or other
proceeding threatened or pending against or affecting such Person or its property,
whether civil, criminal, administrative, investigative or appellate, in law or
equity before any arbitrator or Governmental Body.

 

 

“Administrative
Agent” means initially Aladdin, and thereafter, any successor
Administrative Agent appointed pursuant to Section 9.8.

 

“Affiliate”
means, with respect to a specified Person, any other Person which directly or
indirectly, through one or more intermediaries, controls or is controlled by or
is under common control with such Person, and without limiting the generality
of the foregoing, includes (a) any Person which beneficially owns or holds
ten (10%) percent or more of any class of Voting Stock of such Person or other
equity interests in such Person, (b) any Person of which such Person
beneficially owns or holds ten (10%) percent or more of any class of Voting
Stock or in which such Person beneficially owns or holds ten (10%) percent or
more of the equity interests and (c) any director or executive officer of
such Person.  For the purposes of this
definition, the term “control” (including with correlative meanings, the terms “controlled
by” and “under common control with”), as used with respect to any Person, means
the possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of Voting Stock, by agreement or otherwise.  For purposes of determining an Affiliate of
the Borrower and its Subsidiaries, the definition of “Affiliate” shall not
include Administrative Agent or any Lender.

 

“Aggregate Amounts Due” has the meaning set forth in Section 2.14.

 

“Agreement”
means this Credit Agreement, as it may be amended, amended and restated,
supplemented or otherwise modified from time to time.

 

“Applicable
Prepayment Premium”  has the
meaning set forth in Section 2.11(g).

 

“Approved
Fund” means any Fund that is administered or managed by a Lender, an
Affiliate of a Lender, or an entity or an Affiliate of an entity that
administers or manages a Lender.

 

“Asset Sale”
means a sale, lease or sublease (as lessor or sublessor), sale and leaseback,
assignment, conveyance, transfer or other disposition to, or any exchange of
property with, any Person (other than the Borrower or any Subsidiary of the
Borrower), in one transaction or a series of transactions, of all or any part
of the businesses of the Borrower or any Subsidiary of the Borrower, assets or
properties of any kind, whether real, personal, or mixed and whether tangible
or intangible (including any Intellectual Property), whether now owned or
hereafter acquired, including, without limitation, the Capital Stock of any
Subsidiary of the Borrower, other than (i) inventory, Intellectual
Property, damaged, worn out or other obsolete personal property or other assets
sold, leased, subleased, assigned, conveyed, transferred or disposed of in the
ordinary course of business and (ii) the sale, lease or sublease (as
lessor or sublessor), sale and leaseback, assignment, conveyance, transfer or
other disposition to, or any exchange of property with, any Person (other than
the Borrower or any Subsidiary of the Borrower), in one transaction or a series
of transactions, of any Non-Core Land.

 

“Assignee”
has the meaning set forth in Section 10.4(b).

 

2

 

“Assignment”
has the meaning set forth in Section 10.4(b).

 

“Assignment
Agreement” has the meaning set forth in Section 10.4(b).

 

“Authorized
Officer” means, as applied to any Person, any individual holding the
position of chairman of the board (if an office), chief executive officer,
president or one of its executive or senior vice presidents (or the equivalent
thereof), and such Person’s chief financial officer or treasurer.

 

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

 

“Base Rate”
means, for any day, a fluctuating rate per annum equal to the greater of “prime
rate” of interest in effect for such day as published in the Wall Street
Journal.    Notwithstanding the
foregoing, if the “Base Rate” as determined pursuant to the immediately
preceding sentence is below 3.50% per annum for any day, then for all purposes
of this Agreement and the other Loan Documents, “Base Rate” shall be deemed to
be 3.50% for such day.

 

“Base Rate
Loans” means Term Loans bearing interest at a rate determined by
reference to the Base Rate.

 

“Borrower”
has the meaning assigned to that term in the preamble hereto.

 

“Borrowing”
means the making of any Term Loan.

 

“Borrowing
Certificate” means a Borrowing Certificate substantially in the form
of Exhibit A-1.

 

“Business Day”
means a day other than Saturday or Sunday or other day on which commercial
banks in New York City, New York are authorized or required by law or other
governmental action to close; and, with respect to any borrowings,
disbursements and payments in respect of and calculations, interest rates and
interest periods pertaining to LIBOR Loans, such day is also a day on which
dealings are carried on for deposits in Dollars by and among banks in the
London interbank market.

 

“Capital
Expenditures” means, for any Person for any period, amounts paid or
Indebtedness incurred by such Person or any of its Subsidiaries in connection
with the purchase or lease by the Borrower or any of its Subsidiaries of any
fixed asset, real property or improvements that would be treated as capital
expenditures and reflected as additions to property, plant or equipment on the
balance sheet of such Person in accordance with GAAP.

 

“Capital
Lease Obligations” means, as applied to any Person, the obligations
of such Person under any lease of any property (whether real, personal or
mixed) by that Person as lessee that, in conformity with GAAP, is or should be
accounted for as a capital lease on the balance sheet of that Person.

 

3

 

“Capital
Stock” means any and all shares, interests, participations or other
equivalents (however designated) of capital stock of a corporation, any and all
equivalent ownership interests in a Person (other than a corporation),
including, without limitation, partnership interests and membership interests,
and any and all warrants, rights or options to purchase or other arrangements
or rights to acquire any of the foregoing.

 

“Cash”
means cash, money or currency.

 

“Cash
Equivalents” means, as at any date of determination:

 

(a)                                  securities issued or directly and fully guaranteed or
insured by the United States of America or any agency or instrumentality
thereof (provided, that the full faith and credit
of the United States of America is pledged in support thereof);

 

(b)                                 time deposits, certificates of deposit, bankers’ acceptances
and commercial paper issued by the parent corporation of any domestic
commercial bank of recognized standing having capital and surplus in excess of
$500,000,000;

 

(c)                                  commercial paper issued by others rated at least A-2 or the
equivalent thereof by S&P or at least P-2 or the equivalent thereof by
Moody’s;

 

(d)                                 repurchase obligations with a term of not more than seven
days for· underlying
securities of the types described in (a) and (b) above entered into
with any financial institution meeting the qualifications specified in (b) above;
or

 

(e)                                  money market funds, substantially all of the assets of which
constitute Cash Equivalents of the kinds described in (a) through (d) of
this definition;

 

and in the case of each of
(a), (b), and (c) maturing within one year after the date of acquisition.

 

“Change of
Control” means, at any time, (a) the direct or indirect sale,
lease, transfer, conveyance or other disposition (other than by way of merger
or consolidation), in one or a series of related transactions, of all or
substantially all of the properties or assets of the Borrower and its
Subsidiaries taken as a whole to any Person other than the Permitted Holder or
a Related Party of the Permitted Holder, (b) any Person or “group” (within
the meaning of Rules 13d-3 and 13d-5 under the Exchange Act) (other than
the Permitted Holder or a Related Party of the Permitted Holder) shall have
acquired beneficial ownership of 35% or more on a fully diluted basis of the
voting interest in the Capital Stock of the Borrower; (c) the Continuing
Directors cease for any reason to constitute the majority of the Borrower’s
board of directors then in office; (d) the Borrower adopts a plan of
liquidation; (e) the Borrower consolidates with, or merges with or into,
any Person other than the Permitted Holder or a Related Party of the Permitted
Holder, or any Person other than the Permitted Holder or a Related Party of the
Permitted Holder consolidates with, or merges with or into, the Borrower, in
any such event pursuant to a transaction in which any of the outstanding voting
equity interests of the Borrower or such other Person is converted into or
exchanged for cash, securities or other property, other than any such transaction
where the voting equity interests of the 

 

4

 

Borrower
outstanding immediately prior to such transaction constitute or are converted
into or exchanged for a majority of the outstanding shares of the voting equity
interests of such surviving or transferee Person (immediately after giving
effect to such transaction; (f) the occurrence of a “Change of Control” as
defined in the Senior Secured Notes Indenture or the occurrence of a “Change of
Control” as defined in the Senior Subordinated Notes Indenture; or (g) the
Borrower shall cease to beneficially own and control 100% on a fully diluted
basis of the economic and voting interest in the Capital Stock of each of MPI,
PIDI and SDI.

 

“Closing Date”
means the date on which all of the conditions set forth in Section 3.1 are
satisfied or otherwise waived by the Lenders and Administrative Agent.

 

“Closing Date
Certificate” means a Closing Date Certificate substantially in the
form of Exhibit 3.1(k).

 

“Closing Date
Mortgaged Property” has the meaning set forth in Section 3.1(r).

 

“Collateral”
means, collectively, all of the real, personal and mixed property in which
Liens are purported to be granted pursuant to the Security Documentation as
security for the Obligations.

 

“Collateral
Questionnaire” means a certificate in form satisfactory to
Administrative Agent that provides information with respect to the personal or
mixed property of each Credit Party.

 

“Compliance
Certificate” means a Compliance Certificate substantially in the
form of Exhibit E.

 

“Consents”
means any approval, consent, authorization or order of, notice to or
registration or filing with, or any other action by, any Governmental Body or
other Person.

 

“Consolidated
EBITDA” means, with respect to any period, an amount determined for
the Borrower and its Subsidiaries on a consolidated basis equal to: (a) the
Consolidated Net Income of such Person and its Subsidiaries for such period, plus
(b) to the extent taken into account in calculating Consolidated Net
Income, the sum of (i) depreciation and amortization and other non-cash
charges including imputed interest and deferred compensation for such period,
all in accordance with GAAP (excluding any such non-cash charges to the extent
that it represents an accrual or reserve for potential cash items in any future
period or amortization of a prepaid cash item that was paid in a prior period),
plus (ii) Interest Expense for such period, plus (iii) Taxes
for such period plus (iv) other non-cash items to the extent such
items reduce the Consolidated Net Income of such Person for such period
(excluding any such non-cash item to the extent it represents an accrual or
reserve for potential cash item in any prior period) plus (v) pre-opening
expenses, calculated and classified as such in accordance with GAAP, incurred
in connection with the opening of new facilities plus (vi) non-recurring
cash severance charges for such period plus (vii) non-recurring
cash expenses incurred in connection with the pursuit of gaming in Ohio in an
amount up to $10,000,000 for the Fiscal Year 

 

5

 

ended
December 31, 2009 plus (viii) non-recurring impairment costs plus
(ix) cash settlement costs incurred in connection with the litigation with
Edson R. Arneault in an amount up to $1,600,000 for the Fiscal Year ended December 31,
2009 plus (x) non-recurring cash expense incurred in connection
with procuring a Gaming License with respect to the PIDI Facility in an amount
up to $10,000,000 for the Fiscal Year ended December 31, 2009, minus
(c) to the extent taken into account in calculating Consolidated Net
Income, the sum of (i) other non-cash items to the extent such items
increase the Consolidated Net Income of such Person for such period (excluding
any such non-cash item to the extent it represents the reversal of an accrual
or reserve for potential cash item in any prior period) plus (ii) interest
income.

 

“Consolidated Excess Cash Flow” means,
with respect to any period, an amount (if positive) determined for the Borrower
and its Subsidiaries on a consolidated basis equal to: (a) the sum,
without duplication, of the amounts for such period of (i) Consolidated
EBITDA, plus (ii) cash interest income, plus (iii) other
non-ordinary course cash income deducted in the calculation of Consolidated
EBITDA (excluding any gains or losses attributable to Asset Sales), plus
(iv) the Working Capital Adjustment, minus (b) the sum,
without duplication, of the amounts for such period of (i) voluntary and scheduled
repayments of  Indebtedness, plus (ii) Capital
Expenditures (net of any proceeds of (A) Net Asset Sale Proceeds to the
extent reinvested in accordance with Section 2.11(a), (B) Net
Insurance/Condemnation Proceeds to the extent reinvested in accordance with Section 2.11(b) and
(C) any proceeds of related financings with respect to such expenditures),
plus (iii) cash Interest Expense (assuming, in the case of Fiscal
Year 2010, that the Senior Secured Notes were issued on January 1, 2009) plus
(iv) provisions for current taxes based on income of such Person and its
Subsidiaries and payable in cash with respect to such period, plus (v) one-time
Gaming License fees in an aggregate amount not to exceed $16,500,000 payable on
or before June 30, 2010, plus (vi) proceeds from any tax
refunds received by the Credit Parties with respect to the 2009 Fiscal Year, in
an aggregate amount not to exceed $9,000,000.

 

“Consolidated
Net Income” means, with respect to any Person for any period, the
aggregate of the net income (loss) of such Person and its consolidated
Subsidiaries, for such period (excluding to the extent included therein (a) any
extraordinary and/or one time or unusual and non-recurring gains or any
non-cash losses and (b) any non-operating income or gains and any interest
income) after deducting all charges which should be deducted before arriving at
the net income (loss) for such period and, without duplication, after deducting
the Taxes for such period, all as determined in accordance with GAAP; provided,
however, net income or losses from discontinued operations occurring
prior to April 1, 2010, shall not be included in Consolidated Net
Income.  For the purposes of this
definition, net income excludes any gain or non-cash loss, together with any
related Taxes for such gain or non-cash loss, realized upon the sale or other
disposition of any assets that are not sold in the ordinary course of business
(including, without limitation, dispositions pursuant to sale and leaseback
transactions) or of any Capital Stock of such Person and any net income
realized or loss incurred as a result of changes in accounting principles or
the application thereof to such Person.

 

6

 

“Consolidated
Tangible Assets” means with respect to any Person, the consolidated
total assets of such Person and its Subsidiaries less all goodwill, trade
names, trademarks, patents, unamortized debt discount and expense and other
similar intangibles properly classified as intangibles in accordance with GAAP,
all as shown on the most recent balance sheet for such Person and computed in
accordance with GAAP.

 

“Continuing Directors” means during
any period of 12 consecutive months after the Closing Date, individuals who at
the beginning of any such 12-month period constituted the board of directors of
the Borrower (together with any new directors whose election by such board of
directors or whose nomination for election by the shareholders 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, including new directors
designated in or provided for in an agreement regarding the merger, consolidation
or sale, transfer or other conveyance, of all or substantially all of the
assets of the Borrower, if such agreement was approved by a vote of such
majority directors).

 

“Conversion/Continuation
Date” means the effective date of a continuation or conversion, as the case
may be, as set forth in the applicable Conversion/Continuation Notice.

 

“Conversion/Continuation
Notice” means a Conversion/Continuation Notice substantially in the
form of Exhibit A-2

 

“Copyright
Security Agreement” has the meaning set forth in the Security
Agreements.

 

“Core Gaming
Asset” means (a) all or substantially all of the property and
assets associated with the Borrower’s operations (excluding Non-Core Land) at (i) Mountaineer
Casino, Racetrack & Resort in Chester, West Virginia; (ii) Presque
Isle Downs & Casino in Erie, Pennsylvania; and (iii) Scioto Downs
in Columbus, Ohio, and (b) the Capital Stock of any subsidiary that,
directly or indirectly, owns or controls any of the property, assets or
operations referred to in clauses (a)(i) through (a)(iii) of this
definition

 

“Credit Party”
means each of the Borrower and Guarantors.

 

“Current
Assets” means, with respect to any Person, as at any date of
determination, the total assets of such Person and its Subsidiaries on a consolidated
basis that may properly be classified as current assets in conformity with
GAAP, excluding Cash and Cash Equivalents.

 

“Current
Liabilities” means, with respect to any Person, as at any date of
determination, the total liabilities of such Person and its Subsidiaries on a
consolidated basis that may properly be classified as current liabilities in
conformity with GAAP, excluding the current portion of long term debt.

 

“Default”
means a condition or event that, after notice or lapse of time or both, would
constitute an Event of Default.

 

7

 

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

 

“Eligible
Assignee” means (a) any Lender or any Affiliate or Approved
Fund of any Lender and/or (b) any commercial bank, insurance company,
investment or mutual fund or other entity that is an “accredited investor” (as
defined in Regulation D under the Securities Act) and that extends credit or
buys loans as its primary business; provided, that neither the Borrower
nor any of its Affiliates shall be an Eligible Assignee; provided further,
that (i) no finding of unsuitability has been made or determined by any
Gaming Authority against any Eligible Assignee, (ii) no consent or
approval is required with respect to such Eligible Assignee which has not yet
been obtained, (iii) Administrative Agent has provided to the Borrower
notice of such assignment and (iv) so long as no Event of Default shall
have occurred and be continuing, no Eligible Assignee shall be a competitor or
an Affiliate of a competitor of any Credit Party.

 

“Employee
Benefit Plan” means any “employee benefit plan” as defined in Section 3(3) of
ERISA which is sponsored, maintained or contributed to by, or required to be
contributed by, the Borrower or any of its Subsidiaries and any “employee
benefit plan” as defined in Section 3(3) of ERISA which was
sponsored, maintained or contributed to by, or required to be contributed to
by, the Borrower of its Subsidiaries with respect to which the Borrower or any
Subsidiary could incur liability.

 

“Environmental
Laws” means all federal, state, provincial, local and foreign laws
(including without limitation common law), statutes, regulations and rules whether
now or hereinafter in effect relating in any way to the protection of the
environment or the management, release or threatened release of any Hazardous
Material, including, without limitation, the Resource Conservation and Recovery
Act, the Comprehensive Environmental Response Compensation and Liability Act of
1980, the Superfund Amendments and Reauthorization Act of 1986, the Federal
Clean Water Act, the Federal Clean Air Act and the Toxic Substances Control
Act, in each case as amended, and all rules, regulations, judgments, decrees, orders
and licenses arising under all such laws.

 

“Environmental
Liability” means any actual or contingent liability or obligations
of any Credit Party directly or indirectly resulting from or based on (a) violations
or alleged violations of any Environmental Law, (b) the generation, use,
handling, transportation, storage, treatment or disposal of any Hazardous
Material, (c) exposure to any Hazardous Material, (d) the release or
threatened release of any Hazardous Material into the environment or (e) any
contract, agreement or other consensual arrangement pursuant to which liability
is assumed by or imposed on such Credit Party with respect any of the
foregoing.

 

“Environmental
Permits” means all permits, licenses, authorizations, registrations
and other governmental consents required by applicable Environmental Laws for
the operations of any Credit Party.

 

“Equipment”
means, as to any Credit Party, all of such Credit Party’s now owned and
hereafter acquired equipment, wherever located, including machinery, data 

 

8

 

processing
and computer equipment (whether owned or licensed and including embedded
software), vehicles, tools, furniture, fixtures, all attachments, accessions
and property now or hereafter affixed thereto or used in connection therewith,
and substitutions and replacements thereof, wherever located.

 

“ERISA”
means the Employee Retirement Income Security Act of 1974, as amended from time
to time, and any successor thereto.

 

“ERISA
Affiliate” means, as applied to any Person, (a) any corporation
which is a member of a controlled group of corporations within the meaning of Section 414(b) of
the Internal Revenue Code of which that Person is a member, (b) any trade
or business (whether or not incorporated) which is a member of a group of
trades or businesses under common control within the meaning of Section 414(c) of
the Internal Revenue Code of which that Person is a member, and (c) any
member of an affiliated service group within the meaning of Section 414(m) or
(o) of the Internal Revenue Code of which that Person is a member.  Any former ERISA Affiliate of any Credit
Party shall continue to be considered an ERISA Affiliate of such Credit Party
within the meaning of this definition with respect to the period such entity
was an ERISA Affiliate of such Credit Party and with respect to liabilities
with respect to such entity arising after such period for which such Credit
Party could be liable under the Internal Revenue Code or ERISA.

 

“Event of
Default” means each of the conditions or events set forth in Section 8.1.

 

“Exchange Act”
means the Securities Exchange Act of 1934, as amended from time to time, and
any successor statute.

 

“Existing
Agreement”  means the
Fifth Amended and Restated Credit Agreement, dated as of September 22,
2006, by and among MTR Gaming Group, Inc., Mountaineer Park, Inc.,
Speakeasy Gaming of Las Vegas, Inc., Presque Isle Downs, Inc., Scioto
Downs, Inc. and Speakeasy Gaming of Fremont, Inc., as borrowers, the
lenders from time to time party thereto, and Wells Fargo Bank, National
Association, as the issuer of letters of credit thereunder, administrative
agent and collateral agent, as amended, supplemented and otherwise modified
prior to the date hereof.

 

“FF&E
Financing” means purchase money indebtedness and Capital Lease
Obligations, the proceeds of which are used solely by the Borrower and its
Subsidiaries to acquire or lease, respectively, furniture, fixtures and
equipment (including Gaming Equipment) in the ordinary course of business for
use in Gaming Facilities.

 

“Financial
Officer Certification” means, with respect to the financial
statements for which such certification is required, the certification of the
chief financial officers of the Borrower  that such
financial statements fairly present, in all material respects, the financial
condition of the Borrower  and its
Subsidiaries on a consolidated basis as at the dates indicated and the results
of their operations and their cash flows for the periods indicated, subject to
changes resulting from audit and normal year-end adjustments.

 

9

 

“Financial
Statements” means as of the Closing Date, (a) the audited
financial statements of the Borrower  and its
Subsidiaries, on a consolidated and consolidating basis, for the Fiscal Year
ended December 31, 2008, consisting of balance sheets and the related
statements of income, stockholders’ equity and cash flows for such Fiscal Year,
(b) the management letters related to the audited financial statements
referenced in clause (a), (c) draft unaudited financial statements of the
Borrower and its Subsidiaries, on a consolidated and consolidating basis, for
the Fiscal year ended December 31, 2009, consisting of balance sheets and
the related statements of income, stockholders’ equity and cash flows for such
Fiscal Year and (d) for the interim period from January 1, 2010
through January 31, 2010, internally prepared, unaudited financial
statements of the Borrower  and its
Subsidiaries, consisting of a balance sheet and the related consolidated
statements of income, stockholders’ equity and cash flows, in the case of
clauses (c) and (d), certified by the chief financial officer or the
executive vice president of accounting and finance of the Borrower  that they fairly present, in all material respects, the
financial condition of the Borrower  and its
Subsidiaries as at the dates indicated and the results of their operations and
their cash flows for the periods indicated, subject, if applicable, to changes
resulting from audit and normal year end adjustments.

 

“Fiscal
Quarter” means a fiscal quarter of any Fiscal Year.

 

“Fiscal Year”
means the fiscal year of the Borrower and each Subsidiary of the Borrower
ending on December 31 of each calendar year.

 

“Foreign
Lender” has the meaning set forth in Section 7.2(a).

 

“Fund”
means any Person (other than a natural person) that is (or will be) engaged in
making, purchasing, holding or otherwise investing in commercial loans and
similar extensions of credit in the ordinary course of its business.

 

“Future
Gaming Facility” means (i) any Gaming Facility owned or
operated, or to be owned or operated, by the Borrower or its Subsidiaries after
the Closing Date but which is not owned or operated by the Borrower or its
Subsidiaries on the Closing Date and (ii) gaming operations initially
conducted following the Closing Date at a Gaming Facility owned or operated by
the Borrower as a result of the approval of additional permitted gaming
activities by the applicable Gaming Authorities.

 

“GAAP”
means generally accepted accounting principles in the United States as in
effect from time to time, consistently applied throughout the periods to which
reference is made.

 

“Gaming
Authority” means any agency, authority, board, bureau, commission, department,
office or instrumentality of any nature whatsoever of the United States federal
government, any foreign government, any state, province or city or other
political subdivision or otherwise, whether now or hereafter in existence, or
any officer or official thereof, or any other agency, in each case, with
authority to regulate any gaming or racing operation (or proposed gaming or
racing operation) owned, managed or operated by the Borrower and its
Subsidiaries.

 

10

 

“Gaming
Equipment” means slot machines, table games and other gaming
equipment permitted to be installed under applicable Gaming Laws governing the
Gaming Facility in which such Gaming Equipment will be installed, and any
related signage, accessories, surveillance and peripheral equipment.

 

“Gaming
Facility” means any gaming or parimutuel wagering establishment and
other property or assets directly ancillary thereto or used in connection
therewith, including any building, restaurant, hotel, theater, parking
facilities, retail shops, land, golf courses and other recreation and
entertainment facilities, vessel, barge, ship and equipment, owned or operated
by the Borrower or its Subsidiaries.

 

“Gaming
FF&E Financing” means FF&E Financing, the proceeds of which
are used solely by the Borrower and its Subsidiaries to acquire or lease Gaming
Equipment to be installed in Future Gaming Facilities.

 

“Gaming Law”
means the provisions of any gaming or racing laws or regulations of any
jurisdiction or jurisdictions to which any of the Borrower and its Subsidiaries
is, or may at any time after the date of this Agreement, be subject.

 

“Gaming
License” means any Permit required to own, lease, operate or
otherwise conduct gaming or racing activities of the Borrower and its
Subsidiaries.

 

“Governmental
Body” means any agency, bureau, commission, court, department,
official, political subdivision, tribunal or other instrumentality of any
administrative, judicial, legislative, executive, regulatory, police or taxing
authority of any government, whether supranational, national, federal, state,
regional, provincial, local, domestic or foreign.

 

“Guarantors”
means, collectively, the following (together with their respective successors
and assigns): (a) each of the Subsidiaries of the Borrower listed on the
signature pages hereto and (b) each other entity which becomes a
Guarantor pursuant to Section 5.14 (each sometimes being referred to
herein individually as a “Guarantor”).

 

“Guaranty”
means the guaranty agreement substantially in the form set forth in Exhibit C.

 

“Guaranties” means,
collectively, the MPI Guaranty, the PDI Guaranty and the SDI Guaranty.

 

“Hazardous
Materials” means any hazardous or toxic substance, waste,
contaminant, pollutant, gas or material, including, without limitation,
radioactive materials, oil, petroleum and petroleum products and constituents
thereof, which are regulated under any Environmental Law, including, without
limitation, any substance, waste or material which is (a) designated a “pollutant”,
“hazardous substance”, “extremely hazardous substance” or “toxic chemical”
under any Environmental Law, or (b) regulated as hazardous or toxic in any
way under the Regulations of any state where any Credit Party conducts its
business or owns any real property or has any leasehold or in which any
Relevant Property is located.

 

11

 

“Hotel/Casino
Facility” means, individually, and “Hotel/Casino
Facilities” means, collectively, reference to the MPI Hotel/Casino
Facilities, the SDI Facility and the PIDI Facility, in each case, including any
future expansions thereof, related thereto or used in connection therewith, and
all appurtenances thereto.

 

“Immaterial
Subsidiary” means as of any date of determination, any Subsidiary
that (a) has total assets as of such date with a fair market value not in
excess of $1,000,000, (b) conducted no business during, and has no revenue
for, the most recently ended four Fiscal Quarters, (c) neither has no
Indebtedness as of such date nor directly or indirectly, guarantees or
otherwise provides direct credit support for any Indebtedness of an Credit
Party and (d) is not a licensee under, and does not otherwise hold, a
Gaming License; and provided  further that if more than one
Subsidiary is deemed an Immaterial Subsidiary pursuant to this definition, all
Immaterial Subsidiaries shall be considered to be a single consolidated
subsidiary for purposes of determining whether the conditions specified above
are satisfied.

 

“Indebtedness”
means, with respect to any Person, without duplication, the following:  (a) all indebtedness of such Person for
borrowed money; (b) all obligations of such Person for the deferred
purchase price of property or services other than accounts payable and accrued
liabilities that would be classified as current liabilities under GAAP which
payables and expenses are incurred in respect of property or services purchased
in the ordinary course of business; (c) all obligations of such Person
evidenced by notes, bonds, debentures or similar borrowing or securities
instruments; (d) all obligations of such Person created or arising under
any conditional sale or other title retention agreement with respect to
property acquired by such Person; (e) all Capital Lease Obligations of
such Person as lessee; (f) all obligations of such Person in respect of
banker’s acceptances and letters of credit; (g) all net obligations of
such Person in respect of any interest rate hedging agreements or currency
hedging agreements; (h) all obligations of such Person in respect of any
guaranty by such Person of any obligation of another Person of the type
described in clauses (a) through (g) of this definition; and (i) all
obligations of another Person of the type described in clauses (a) through
(h) secured by a Lien on the property or assets of such Person (whether or
not such Person is otherwise liable for such obligations of such other Person).

 

“Indemnified
Person” has the meaning set forth in Section 7.3(a) hereof.

 

“Intellectual
Property” means, collectively, all copyrights, all patents and all
trademarks, together with:  (a) all
inventions, processes, production methods, proprietary information, know-how
and trade secrets; (b) all licenses or user or other agreements granted to
any Credit Party with respect to any of the foregoing, in each case whether now
or hereafter owned or used including the licenses or other agreements with
respect to any Collateral; (c) all customer lists, identification of
suppliers, data, plans, blueprints, specifications, designs, drawings, recorded
knowledge, surveys, engineering reports, test reports, manuals, materials
standards, processing standards, performance standards, catalogs, computer and
automatic machinery software and programs; (d) all field repair data,
sales data and other information relating to sales or service of products now
or hereafter manufactured; (e) all accounting information and all media in
which or on 

 

12

 

which
any information or knowledge or data or records may be recorded or stored and
all computer programs used for the compilation or printout of such information,
knowledge, records or data; and (f) all causes of action, claims and
warranties, in each case, now or hereafter owned or acquired by any Credit
Party in respect of any of the items listed above.

 

“Intercreditor
Agreement” means the Collateral Agency and Intercreditor Agreement,
dated as of August 12, 2009, by and among the Borrower, MPI, PIDI, SDI,
Wells Fargo Bank, National Association, as administrative agent and collateral
agent for the initial first lien secured parties, the Second Lien Trustee and
the Second Lien Collateral Agent, as supplemented by the Intercreditor
Agreement Joinder.

 

“Intercreditor
Agreement Joinder” means the First Lien Joinder Agreement, dated as
of the date hereof, by Administrative Agent and acknowledged and agreed to by the
Borrower, MPI, PIDI and SDI, pursuant to which Administrative Agent agrees to
become a party to the Intercreditor Agreement as a New Agent (as defined
therein), First Lien Administrative Agent (as defined therein) and a First Lien
Secured Party (as defined therein) under the Intercreditor Agreement.

 

“Interest
Coverage Ratio”  means, as of
the last day of any Fiscal Quarter, the ratio of (a) Consolidated EBITDA
for the four-Fiscal Quarter period then ending, to (b) consolidated
Interest Expense for such four Fiscal Quarter period.

 

“Interest
Expense” means, for any period, as to any Person, as determined in
accordance with GAAP, the total interest expense of such Person, whether paid
or accrued during such period (including the interest component of Capital
Lease Obligations for such period, the amortization of loan origination or
structuring fees and any consent fee paid or accrued in favor of the holders of
the Senior Subordinated Notes), including, without limitation, discounts in
connection with the sale of any Accounts and bank fees, commissions, discounts
and other fees and charges owed with respect to letters of credit, banker’s
acceptances or similar instruments, in each case attributable to such Person.

 

“Interest
Payment Date” means with respect to (i) any Base Rate Loan, the
last day of each month, commencing on the first such date to occur after the
Closing Date; and (ii) any LIBOR Loan, the last day of each Interest
Period applicable to such LIBOR Loan; provided that in the case of each
Interest Period of longer than three months “Interest Payment Date” shall also
include the date that is ninety (90) days after the commencement of such
Interest Period.

 

“Interest
Period” means, in connection with a LIBOR Loan, an interest period
of one-, two-, three- or six- months, as selected by the Borrower in the
applicable Borrowing Certificate or Conversion/Continuation Notice, (i) initially,
commencing on the date of the Borrowing or Conversion/Continuation Date
thereof, as the case may be; and (ii) thereafter, commencing on the day on
which the immediately preceding Interest Period expires; provided, (a) if
an Interest Period would otherwise expire on a day that is not a Business Day,
such Interest Period shall expire on the next succeeding Business 

 

13

 

Day
unless no further Business Day occurs in such month, in which case such
Interest Period shall expire on the immediately preceding Business Day; (b) any
Interest Period that begins on the last Business Day of a calendar month (or on
a day for which there is no numerically corresponding day in the calendar month
at the end of such Interest Period) shall, subject to clause (c), of this
definition, end on the last Business Day of a calendar month; and (c) no
Interest Period with respect to any portion of the Term Loans shall extend
beyond the Maturity Date.

 

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

 

“Internal
Revenue Code” means the Internal Revenue Code of 1986, as amended to
the date hereof and from time to time hereafter, and any successor statute.

 

“Investment”
means (a) any direct or indirect purchase, redemption, retirement or other
acquisition for value by any Credit Party of, or of a beneficial interest in,
any of the Securities (including any Capital Stock) of any Person and (b) any
direct or indirect loan, advance (other than advances to employees for moving,
entertainment and travel expenses, drawing accounts and similar expenditures in
the ordinary course of business) or capital contribution by any Credit Party to
any other Person (other than the Borrower or any of its Subsidiaries),
including all indebtedness and accounts receivable from that other Person that
are not current assets or did not arise from sales to that other Person and/or
constitute ordinary trade credit extended in the ordinary course of
business.  The amount of any Investment
shall be the original cost of such Investment plus the cost of all additions
thereto, without any adjustments for increases or decreases in value, or
write-ups, write-downs or write-offs with respect to such Investment.

 

“Knowledge”
means, with respect to any Credit Party as the context requires, the knowledge
of any of such Credit Party’s Authorized Officers after notice and reasonable
inquiry by such Authorized Officers.

 

“Landlord
Access Agreement” means a landlord access agreement in a form
reasonably satisfactory to Administrative Agent.

 

“Leasehold
Property” means any leasehold interest of any Credit Party as lessee
under any lease of real property, other than any such leasehold interest
designated from time to time by Administrative Agent in its sole discretion as
not being required to be included in the Collateral.

 

“Lenders”
has the meaning set forth in the Preamble to this Agreement, together with any
of their successors and permitted assigns.

 

“Leverage
Ratio”  shall mean, as of the last day of
any Fiscal Quarter, the ratio of (a) total consolidated Indebtedness for
the Borrower and its Subsidiaries as of such day, to (b) Consolidated
EBITDA for the four Fiscal Quarter period ending on such date.

 

“Liabilities”
has the meaning set forth in Section 10.4(d) hereof.

 

14

 

“LIBOR”
means, as to any Term Loan for any Interest Period, the rate per annum obtained
by dividing (and rounding upward to the next whole multiple of 1/16 of 1%) (a) the
rate quoted by Bloomberg Information Service (or by any successor or substitute
for such Service, or any successor to or substitute for such Service, providing
rate quotations comparable to those currently provided by such Service, as
determined by Administrative Agent from time to time for purposes of providing
quotations of interest rates applicable to Dollar deposits in the London
interbank market) at approximately 11:00 a.m., London time, on the
applicable Interest Rate Determination Date, as the rate for Dollar deposits
with a maturity comparable to such Interest Period.  If such rate is not available at such time
for any reason, LIBOR as to any LIBOR Loan for any Interest Period shall be the
arithmetic mean (rounded upward, if necessary, to the next 1/16 of 1%) of the
offered quotations of at least two Reference Banks to the prime banks in the
London interbank market for dollar deposits with a maturity comparable to such
Interest Period at approximately 11:00 a.m., London time, on the
applicable Interest Rate Determination Date, by (b) an amount equal to (i) one
minus (ii) the LIBOR Reserve Requirement.  For purposes of this definition, “Reference
Banks” shall mean major banks in the London interbank market reasonably
selected by Administrative Agent. 
Notwithstanding the foregoing, if “LIBOR” as determined pursuant to the
immediately preceding sentences is below 2.50% per annum for any Interest
Period, then for all purposes of this Agreement and the other Loan Documents “LIBOR”
shall be deemed to be 2.50% per annum for such Interest Period.

 

“LIBOR Loans”
means Term Loans bearing interest at a rate determined by reference to LIBOR.

 

“LIBOR
Reserve Requirement” means for any day as applied to a LIBOR Loan,
the aggregate (without duplication) of the maximum rates (expressed as a
decimal fraction) of reserve requirements in effect on such day (including
basic, supplemental, marginal and emergency reserves) under any regulations of
the Board of Governors of the Federal Reserve System or other Governmental
Authority having jurisdiction with respect thereto dealing with reserve
requirements prescribed for eurocurrency funding (currently referred to as “Eurocurrency
Liabilities” in Regulation D of the Board of Governors of the Federal Reserve
System) maintained by a member bank of the Federal Reserve System.  The rate of interest on LIBOR Loans shall be
adjusted automatically on and as of the effective date of any change in the
LIBOR Reserve Requirement.

 

“License
Agreement” has the meaning assigned to such term in Section 4.1(s).

 

“Lien”
means any encumbrance, mortgage, pledge, hypothecation, hypothec, charge, lien,
assignment or other security interest of any kind securing any obligation of
any Person.

 

“Loan
Document” means any of this Agreement, the Notes (if any), the
Security Documentation, the Intercreditor Agreement, the Intercreditor
Agreement Joinder, the Guaranties and all other documents, instruments or
agreements executed and delivered by a Credit Party for the benefit of
Administrative Agent or any Lender in connection herewith.

 

15

 

“Margin Stock”
as defined in Regulation U of the Board of Governors of the Federal Reserve
System as in effect from time to time.

 

“Material
Adverse Effect” means a material adverse effect on (a) the
business, operations, assets, liabilities, prospects or condition (financial or
otherwise) of the Borrower and all of its Subsidiaries taken as a whole or (b) the
ability of the Borrower or any other Credit Party to perform its obligations
hereunder or under of any of the other Loan Documents.

 

“Material
Contracts” means, with respect to any Person, each contract listed
on Schedule 4.1(v), each contract which is a replacement or a substitute
for any contract listed on such Schedule and each other contract to which such
Person is a party which is material to the business, financial condition,
operations, performance, properties or reasonably foreseeable business
prospects of such Person and its Subsidiaries, taken as a whole.

 

“Maturity
Date” means the earlier of (a) the three year anniversary of
the Closing Date and (b) the date on which the Term Loans shall become due
and payable in full hereunder, whether by acceleration or otherwise.

 

“Moody’s”
means Moody’s Investor Services, Inc.

 

“Mortgage”
means a mortgage substantially in the form of Exhibit G.

 

“MPI”
means Mountaineer Park, Inc., a West Virginia corporation.

 

“MPI Guaranty” means the
Guaranty, dated as of even date herewith, between  MPI and Administrative Agent, whereby MPI
shall have guarantied the Obligations.

 

“MPI
Hotel/Casino Facilities” means the racetrack, hotel and casino
business and related activities conducted on the MPI Real Property known as “Mountaineer
Casino, Racetrack & Resort”, “Mountaineer Racetrack & Gaming
Resort”, “Mountaineer Lodge” and “Woodview Golf Course.”

 

“MPI Real
Property” means the real property that is particularly described on Exhibit I.

 

“MPI Stock Pledge
Agreement” means the Stock Pledge Agreement, dated as of even
date herewith, between the Borrower and the Administrative Agent, whereby the
Borrower shall pledge the Capital Stock of MPI as security for the Obligations,
to the extent permitted by the applicable Gaming Authority.

 

“Multiemployer
Plan” means any plan which is a “multi-employer plan” as defined in Section 3(37)
of ERISA.

 

“Net Asset
Sale Proceeds” means, with respect to any Asset Sale, an amount
equal to:  (a) cash payments
received by the Borrower and any of its Subsidiaries from such Asset Sale, minus
(b) any bona fide direct costs incurred in connection with such 

 

16

 

Asset
Sale to the extent paid or payable to non-Affiliates, including (i) income,
franchise, sales, gains or other applicable taxes payable by the seller as a
result of any gain recognized in connection with such Asset Sale, (ii) payment
of the outstanding principal amount of, premium or penalty, if any, and
interest on any Indebtedness (other than the Term Loans and the Senior Secured
Notes) that is secured by a Lien on the stock or assets in question and that is
required to be repaid under the terms thereof as a result of such Asset Sale,
and (iii) a reasonable reserve for any indemnification payments (fixed or
contingent) attributable to seller’s indemnities and representations and
warranties to purchaser in respect of such Asset Sale undertaken by the
Borrower or any of its Subsidiaries in connection with such Asset Sale;
provided that upon releases of such reserve, the amount released shall be
considered Net Asset Sale Proceeds.

 

“Net
Insurance/Condemnation Proceeds” means an amount equal to: (a) any
cash payments or cash proceeds received by the Borrower or any of its
Subsidiaries (i) under any casualty, business interruption or “key man”
insurance policies in respect of any covered loss thereunder or (ii) as a
result of the taking of any assets of the Borrower  and
any of its Subsidiaries by any Person pursuant to the power of eminent domain,
condemnation or otherwise, or pursuant to a sale of any such assets to a
purchaser with such power under threat of such a taking, minus (b)(i) any
actual and reasonable costs incurred by the Borrower and any of its
Subsidiaries in connection with the adjustment or settlement of any claims of
the Borrower or such Subsidiary in respect thereof, and (ii) any bona fide
direct costs incurred in connection with any sale of such assets as referred to
in clause (a)(ii) of this definition to the extent paid or payable to
non-Affiliates, including income taxes payable as a result of any gain
recognized in connection therewith.

 

“Non-Core
Land” means each of the following parcels of land, each of which is
immaterial to the Borrower’s gaming operations and as to which the Borrower has
no intention to develop:

 

(a)                                  the 255.896 acre parcel of land known as the “Quarry Parcel”
in Hancock, West Virginia;

 

(b)                                 the 162.79 acre parcel of land known as the “Woodview Golf
Course” in Hancock, West Virginia;

 

(c)                                  the 11.45 acre parcel of land known as the “Downs Property”
in Erie, Pennsylvania;

 

(d)                                 the 23 acre parcel of land known as the “International Paper”
site in Erie, Pennsylvania;

 

(e)                                  the 130 acre parcel of land known as the “Troyer Parcel” in
Erie, Pennsylvania;

 

(f)                                    the 82.373 acre parcel of land known as the “Green Shingle”
in Erie, Pennsylvania;

 

17

 

(g)                                 the approximately 395 acre portion of the land known as the “Original
Mountaineer Parcel” which is located to the east of State Route 2 site in
Hancock, West Virginia;

 

(h)                                 the 97.706 acre parcel of land known as the “Coldwell Parcel”
in Hancock, West Virginia;

 

(i)                                     the 78.215 acre parcel of land known as the “Hazel Parcel”
in Hancock, West Virginia;

 

(j)                                     the 69.09323 acre parcel of land known as the “Kource Parcel”
site in Hancock, West Virginia;

 

(k)                                  the 1.755 acre parcel of land known as the “Glover/Daily Double
Parcel” in Hancock, West Virginia;

 

(l)                                     the 6.788 acre parcel of land known as the “Jusczak Parcel”
in Hancock, West Virginia;

 

(m)                               the 13.8765 acre parcel of land known as the “J&T Parcel”
in Hancock, West Virginia;

 

(n)                                 the 109.01 acre parcel of land known as the “LSW Sanitation
Parcel” in Hancock, West Virginia;

 

(o)                                 the 0.92 acre parcel of land known as the “Smith Parcel” in
Hancock, West Virginia;

 

(p)                                 the 69.076 acre parcel of land known as the “Watson Parcel”
site in Hancock, West Virginia;

 

(q)                                 the 6.65 acre parcel of land known as the “Phillips Parcel”
in Hancock, West Virginia;

 

(r)                                    the 234.99 acre parcel of land known as Tract 1 of the “Logan/Realm
Parcels” in Hancock, West Virginia;

 

(s)                                  the approximately 0.955 acre parcel of land known as the “Jefferson
School Parcel” in Hancock, West Virginia;

 

(t)                                    the 1.95 acre parcel of land known as the “Carter Parcel” in
Hancock, West Virginia;

 

(u)                                 the approximately 1 acre parcel of land known as the “Hoit
Parcel” in Hancock, West Virginia;

 

(v)                                 the 0.084 acre parcel of land known as the “Maffeo Parcel”
in Erie, Pennsylvania; and

 

18

 

(w)                               the 37.11 acre parcel of land known as the “Mara Parcel” in
Franklin County, Ohio.

 

“Note”
has the meaning set forth in Section 2.6(c).

 

“Obligations”
means all Indebtedness, obligations and liabilities of each Credit Party from
time to time owed to Administrative Agent, the Lenders or any of them, direct
or indirect, joint or several, absolute or contingent, matured or unmatured,
liquidated or unliquidated, secured or unsecured, arising by contract,
operation of law or otherwise, arising or incurred under this Agreement or any
other Loan Document or in respect of any Term Loan, any Note or any other
instruments at any time evidencing any obligation under this Agreement or any
other Loan Document, whether for principal, prepayment premium, interest
(including, without limitation, interest, as provided in this Agreement
accruing after the filing of a petition initiating any insolvency proceedings,
whether or not such interest accrues or is recoverable against the Borrower
after the filing of such petition for purposes of the Bankruptcy Code or is an
allowed claim in such proceeding), fees, expenses, indemnification or otherwise.

 

“Patent
Security Agreement” has the meaning set forth in the Security
Agreements.

 

“Pension Plan”
means any “employee benefit plan” as defined in Section 3(3) of ERISA
(other than a Multiemployer Plan) which is subject to Section 412 of the
Internal Revenue Code or Section 302 of ERISA and which is sponsored,
maintained or contributed to by, or required to be contributed by, the
Borrower, any Subsidiary of the Borrower or any of their respective ERISA
Affiliates and any “employee benefit plan” as defined in Section 3(3) of
ERISA (other than a Multiemployer Plan) which is subject to Section 412 of
the Internal Revenue Code or Section 302 of ERISA and which was sponsored,
maintained or contributed to by, or required to be contributed by, the
Borrower, any Subsidiary of the Borrower or any of their respective ERISA
Affiliates with respect to which the Borrower or any of its Subsidiaries could
incur liability.

 

“Permit”
means any permit, license, approval, consent, permission, notice, franchise,
confirmation, endorsement, waiver, certification, registration, qualification,
clearance or other authorization issued, granted, given or otherwise made
available by or under the authority of any Governmental Body or pursuant to any
federal, state, provincial, local or foreign Regulation.

 

“Permitted
Acquisition” means any acquisition by the Borrower or any Guarantor,
whether by purchase, merger or otherwise, of all or substantially all of the
assets of, all of the Capital Stock of, or a business line or unit or a division
of, any Person; provided,

 

(a)                                  immediately
prior to, and after giving effect thereto, no Default or Event of Default shall
have occurred and be continuing or would result therefrom;

 

19

 

(b)                                 all transactions
in connection therewith shall be consummated, in all material respects, in
accordance with all applicable laws and in conformity with all applicable
Permits;

 

(c)                                  in the case of
the acquisition of Capital Stock, all of the Capital Stock acquired or otherwise
issued by such Person or any newly formed Guarantor in connection with such
acquisition shall be owned 100% by the Borrower or a Guarantor thereof, and to
the extent such Person is a domestic Subsidiary of the Borrower or a Guarantor,
to the extent permitted by any relevant Gaming Authorities, the Borrower shall
have taken, or caused to be taken, as of the date such Person becomes a
Subsidiary of the Borrower, each of the actions set forth in Sections 5.13 and
5.14 and shall cause such domestic Subsidiary to be a “Grantor” under the
Security Documentation;

 

(d)                                 the Borrower
and its Subsidiaries shall be in compliance with (i) the covenants set
forth in Article VI on a pro forma basis after giving effect to such
acquisition and (ii) the financial covenants set forth in Section 6.14
on a pro forma basis after giving effect to such acquisition as of the last day
of the Fiscal Quarter most recently ended, (as determined in accordance with Section 6.14(d));

 

(e)                                  any Person or
assets or division as acquired in accordance herewith shall be in same business
or lines of business (or reasonably related or incidental thereto) in which the
Borrower and/or its Subsidiaries are engaged as of the Closing Date;

 

(f)                                    the Borrower
shall have delivered to Administrative Agent at least five Business Days prior
to such proposed acquisition, a Compliance Certificate evidencing compliance
with Section 6.14 as required by clause (e) above, together with all
relevant financial information with respect to such acquired assets, including,
without limitation, the aggregate consideration for such acquisition and any
other information required to demonstrate compliance with Section 6.14;
and

 

(g)                                 the acquisition
shall have been approved by the board of directors or other governing body or
controlling Person of the Person acquired or the Person from whom such assets
or division is acquired.

 

“Permitted
Holder” means Jeffrey P. Jacobs.

 

“Permitted
Liens” means each of the Liens permitted pursuant to Section 6.2.

 

“Permitted
Refinancing” means, with respect to any Person, any modification,
refinancing, replacement, refunding, renewal or extension of any Indebtedness
of such Person; provided that (a) the
principal amount (or accreted value, if applicable) thereof does not exceed the
principal amount (or accreted value, if applicable) of the Indebtedness so
modified, refinanced, replaced, refunded, renewed or extended except by an
amount equal to unpaid accrued interest and premium thereon plus other reasonable amount paid, and fees and expenses
reasonably incurred, in connection with such modification, refinancing,
replacement, refunding, renewal or extension and by an 

 

20

 

amount
equal to any existing commitments unutilized thereunder, (b) such
modification, refinancing, replacement, refunding, renewal or extension has a
final maturity date equal to or later than the final maturity date of, and has
a Weighted Average Life to Maturity equal to or greater than the Weighted
Average Life to Maturity of, the Indebtedness being modified, refinanced,
replaced, refunded, renewed or extended; provided that any refinancing
of the Senior Subordinated Notes shall have a final maturity date that is at
least six months following the Maturity Date, (c) at the time thereof, no
Event of Default shall have occurred and be continuing, and (d) (i) to
the extent such Indebtedness being modified, refinanced, replaced, refunded,
renewed or extended is subordinated in right of payment to the Obligations,
such modification, refinancing, replacement, refunding, renewal or extension is
subordinated in right of payment to the Obligations on terms at least as
favorable to the Lenders as those contained in the documentation governing the
Indebtedness being modified, refinanced, replaced, refunded, renewed or
extended, (ii) to the extent such Indebtedness being modified, refinanced,
replaced, refunded, renewed or extended is secured by Liens that are
subordinated to the Liens securing the Obligations, such modification, refinancing,
replacement, refunding, renewal or extension is unsecured or secured by Liens
that are subordinated to the Liens securing the Obligations on terms at least
as favorable to the Lenders as those contained in the documentation (including
any intercreditor or similar agreements) governing the Indebtedness being
modified, refinanced, replaced, refunded, renewed or extended, (iii) the
terms and conditions of any such modified, refinanced, replaced, refunded,
renewed or extended Indebtedness, taken as a whole, are not materially less
favorable to the interests of the Lenders than the terms and conditions of the
Indebtedness being modified, refinanced, replaced, refunded, renewed or
extended; provided that a certificate of an
Authorized Officer delivered to the Administrative Agent at least ten Business
Days prior to the incurrence of such Indebtedness, together with a reasonably
detailed description of the material terms and conditions of such Indebtedness
or drafts of the documentation relating thereto, stating that the Borrower has
determined in good faith that such terms and conditions satisfy the foregoing
requirement shall be conclusive evidence that such terms and conditions satisfy
the foregoing requirement unless the Administrative Agent notifies the Borrower
within such ten Business Day period that it disagrees with such determination
(including a reasonable description of the basis upon which it disagrees) and (iv) such
modification, refinancing, replacement, refunding, renewal or extension is
incurred by the Person who is the obligor of the Indebtedness being modified,
refinanced, replaced, refunded, renewed or extended.

 

“Person”
means and includes natural persons, corporations, limited partnerships, general
partnerships, limited liability companies, limited liability partnerships,
joint stock companies, associations, companies, trusts, banks, trust companies,
land trusts, business trusts or other organizations, whether or not legal
entities, other legal entities and Governmental Bodies.

 

“PGCB” means the
Pennsylvania Gaming Control Board and any successor thereto.

 

“PIDI”  means Presque Isle Downs, Inc., a Pennsylvania
corporation.

 

21

 

“PIDI Facility” means the
racetrack, hotel and casino business and related activities conducted on the
PIDI Real Property known as “Presque Isle Downs”.

 

“PIDI Guaranty” means the
Guaranty, dated as of even date herewith, between PIDI and Administrative Agent,
whereby PIDI shall have guarantied the Obligations.

 

“PIDI Real
Property” means the real property that is particularly described on Exhibit J.

 

“Principal
Office” means, for Administrative Agent, its office located at 6
Landmark Square, Stamford, CT 06901, Attention: Simmon Saraf, or such other
office as Administrative Agent may from time to time designate in writing to
the Borrower and each Lender.

 

“Pro Rata
Share” means (i) prior to the Term Loan Commitments being
terminated or reduced to zero, the percentage obtained by dividing (A) the
Term Loan Commitment of such Lender by (B) the aggregate Term Loan
Commitments of all Lenders and (ii) from and after the time that the Term
Loan Commitments have been terminated or reduced to zero, the percentage obtained
by dividing (A) the aggregate principal amount of Term Loans of such
Lender by (B) the aggregate principal amount of Term Loans of all Lenders.

 

“Projections”
has the meaning set forth in Section 5.1(d).

 

“Rating
Agencies” has the meaning set forth in Section 10.4(d) hereof.

 

“Register”
has the meaning set forth in Section 2.6(b).

 

“Regulation”
means each applicable law, rule, regulation, order, guidance or recommendation
(or any change in its interpretation or administration) by any Governmental Body,
central bank or comparable agency and any request or directive (whether or not
having the force of law) of any of those Persons and each judgment, injunction,
order, writ, decree or award of any Governmental Body, arbitrator or other
Person.

 

“Related Party”
means (a) any controlling stockholder, majority owned Subsidiary,
immediate family member, lineal descendant (or spouse of such immediate family
member or lineal descendant) of the Permitted Holder or any executor,
administrator or legal representative for the estate, heirs and beneficiaries
of the Permitted Holder; or (b) any trust, corporation, partnership,
limited liability company or other entity, the beneficiaries, stockholders,
partners, members, owners or Persons beneficially holding a majority (and
controlling) interest of which consist of the Permitted Holder and/or such
other Persons referred to in the immediately preceding clause (a).

 

“Relevant
Property” means, for the Borrower and its Subsidiaries, all sites,
facilities, locations, real property and leaseholds (a) presently owned,
leased, used or operated, or owned, leased, used or operated by the Borrower or
any of its Subsidiaries 

 

22

 

(whether
or not such properties are currently owned, leased, used or operated by any
Credit Party), (b) at which any Hazardous Material has been transported,
disposed, treated, stored or released by the Borrower or any of its
Subsidiaries, or (c) that are directly adjacent to any sites, facilities,
locations, real property or leaseholds presently owned, leased, used or
operated, or owned, leased, used or operated by the Borrower or any of its
Subsidiaries.

 

“Required
Lenders” means, at any time, one or more Lenders having or holding
Term Loan Commitments or Term Loans, and representing more than 50% of (i) prior
to the termination of the Term Loan Commitments, the aggregate Term Loan
Commitments and (ii) after the termination of the Term Loan Commitments,
the aggregate outstanding principal amount of the Term Loans.

 

“Restricted
Payment” means (a) any dividend or other distribution, direct
or indirect, on account of any shares of any class of Capital Stock of the
Borrower or its Subsidiaries now or hereafter outstanding, except a dividend
payable solely in shares of that class of Capital Stock to the holders of that
class, (b) any redemption, retirement, sinking fund or similar payment,
purchase or other acquisition for value, direct or indirect, of any shares of
any class of Capital Stock of the Borrower or its Subsidiaries now or hereafter
outstanding; (c) any payment made to retire, or to obtain the surrender
of, any outstanding warrants, options or other rights to acquire shares of any
class of Capital Stock of the Borrower or its Subsidiaries now or hereafter
outstanding; (d) management or similar fees payable to any shareholder of
the Borrower or any of its Affiliates; and (e) any payment or prepayment
of principal of, premium, if any, or interest on, or redemption, purchase,
retirement, defeasance (including in-substance or legal defeasance), sinking
fund or similar payment with respect to, the Senior Secured Notes, the Senior
Subordinated Notes, any unsecured Indebtedness or any subordinated
Indebtedness.

 

“S&P”
means Standard & Poor’s Ratings Group, a division of The McGraw Hill
Corporation.

 

“SDI”
means Scioto Downs, Inc., an Ohio Corporation.

 

“SDI Facility”
means the real property, improvements and appurtenances located on the SDI Real
Property on which SDI owns and operates a harness horse racing facility with
parimutuel wagering known as “Scioto Downs”.

 

“SDI Guaranty” means the
Guaranty, dated as of even date herewith, between SDI and Administrative Agent,
whereby SDI shall have guarantied the Obligations.

 

“SDI Real
Property” means the real property that is particularly described on Exhibit K.

 

“SDI Stock Pledge
Agreement” means the Stock Pledge Agreement, dated as of even
date herewith, between the Borrower and the Administrative Agent, whereby the
Borrower shall pledge the Capital Stock of SDI as security for the Obligations,
to the extent permitted by the applicable Gaming Authority.

 

23

 

“Second Lien
Collateral Agent” means Wilmington Trust FSB, as collateral agent
for the Second Lien Secured Parties (as defined in the Intercreditor
Agreement).

 

“Second Lien
Trustee” means Wilmington Trust FSB, as trustee under the Senior
Secured Notes Indenture

 

“Secured
Parties” means, collectively, Administrative Agent and the Lenders.

 

“Securities”
means any stock, shares, partnership interests, voting trust certificates,
certificates of interest or participation in any profit-sharing agreement or
arrangement, options, warrants, bonds, debentures, notes, or other evidences of
indebtedness, secured or unsecured, convertible, subordinated or otherwise, or
in general any instruments commonly known as “securities” or any certificates
of interest, shares or participations in temporary or interim certificates for
the purchase or acquisition of, or any right to subscribe to, purchase or
acquire, any of the foregoing.

 

“Securities
Act” means the Securities Act of 1933, as amended from time to time,
and any successor statute.

 

“Securitization”
has the meaning set forth in Section 10.4(d) hereof.

 

“Securitization
Parties” has the meaning set forth in Section 10.4(d) hereof.

 

“Security
Agreements” means, collectively, (i) the Pledge and Security
Agreement, dated as of even date herewith, between the Borrower and
Administrative Agent, (ii) the Pledge and Security Agreement, dated as of
even date herewith, between MPI and Administrative Agent, (iii) the
Security Agreement, dated as of even date herewith, between PIDI and
Administrative Agent and (iv) the Pledge and Security Agreement, dated as
of even date herewith, between SIDI and Administrative Agent, in each case,
substantially in the form of Exhibit F.

 

“Security
Documentation” means the Security Agreements, the Trademark Security
Agreements, the Copyright Security Agreements, the Patent Security Agreements,
the Stock Pledge Agreements, the Mortgages and all other instruments, documents
and agreements delivered by any Credit Party pursuant to this Agreement or any
of the other Loan Documents (including, without limitation, all UCC financing
statements) in order to grant to Administrative Agent, for the benefit of the
Secured Parties, a Lien on any real, personal or mixed property of that Credit
Party as security for the Obligations.

 

“Senior
Secured Notes” means the 12.625% Senior Secured Notes due 2014
issued by the Borrower under the Senior Secured Notes Indenture.

 

“Senior
Secured Notes Indenture” means the Indenture, dated as of August 12,
2009, among MTR Gaming Group, Inc., as issuer, the guarantors party
thereto and the Wilmington Trust FSB, as trustee and collateral agent,
governing the Senior Secured Notes.

 

24

 

“Senior
Subordinated Notes” means the 9% unsecured Senior Subordinated Notes
due June 1, 2012 issued by the Borrower under the Senior Subordinated
Notes Indenture.

 

“Senior
Subordinated Notes Indenture” means the Indenture, dated as of May 25,
2006, among MTR Gaming Group, Inc., as issuer, the guarantors party
thereto and the Wells Fargo Bank, N.A., as trustee, governing the Senior
Subordinated Notes.

 

“Solvency
Certificate”  means a
Solvency Certificate of the chief financial officer of the Borrower
substantially in the form of Exhibit 3.1(l).

 

“Solvent”
means, at any time with respect to any Person, that at such time such Person (a) is
able to pay its debts as they mature and has (and has a reasonable basis to
believe it will continue to have) sufficient capital (and not unreasonably
small capital) to carry on its business consistent with its practices as of the
date hereof, and (b) the assets and properties of such Person at a fair
valuation (and including as assets for this purpose at a fair valuation all
rights of subrogation, contribution or indemnification arising pursuant to any
guarantees given by such Person) are greater than the Indebtedness of such
Person, and including subordinated and contingent liabilities computed at the
amount which, such person has a reasonable basis to believe, represents an
amount which can reasonably be expected to become an actual or matured
liability (and including as to contingent liabilities arising pursuant to any
guarantee the face amount of such liability as reduced to reflect the
probability of it becoming a matured liability).

 

“Stock Pledge Agreement” means the
Stock Pledge Agreement substantially in the form of Exhibit L.

 

“Stock Pledge Agreements” means the MPI
Stock Pledge Agreement and the SDI Stock Pledge Agreement.

 

“Subsidiary”
means, with respect to any Person, any corporation, partnership, limited
liability company, association or other business entity of which more than 50%
of the total voting power of shares of stock or other ownership interests
entitled (without regard to the occurrence of any contingency) to vote in the
election of the Person or Persons (whether directors, managers, trustees or
other Persons performing similar functions) having the power to direct or cause
the direction of the management and policies thereof is at the time owned or
controlled, directly or indirectly, by that Person or one or more of the other
Subsidiaries of that Person or a combination thereof, provided, in
determining the percentage of ownership interests of any Person controlled by
another Person, no ownership interest in the nature of a “qualifying share” of
the former Person shall be deemed to be outstanding; provided further,
that Unrestricted Subsidiaries shall be excluded from this definition, for so
long as such Unrestricted Subsidiaries, either individually or in the
aggregate, are Immaterial Subsidiaries.

 

“Tax”
means any present or future tax, levy, impost, duty, assessment, charge, fee,
deduction or withholding of any nature and whatever called, by whomsoever, on
whomsoever and wherever imposed, levied, collected, withheld or assessed, provided,

 

25

 

“Tax on the overall net income” of a Person shall be
construed as a reference to a tax imposed by the jurisdiction in which that
Person is organized or in which that Person’s applicable principal office
(and/or, in the case of a Lender, its lending office) is located or in which that
Person (and/or, in the case of a Lender, its lending office) is deemed to be
doing business on all or part of the net or gross income, profits or gains
(whether worldwide, or only insofar as such income, profits or gains are
considered to arise in or to relate to a particular jurisdiction, or otherwise)
of that Person (and/or, in the case of a Lender, its applicable lending office)  or franchise taxes imposed
on in lieu of such taxes and any branch profits taxes imposed by the United
States of America or any similar tax imposed by any other jurisdiction in which
the Borrower is located.

 

“Term Loans”
means the Term Loans made pursuant to Section 2.1.

 

“Term Loan
Commitment” means (i) with respect to each Lender that is a
lender on the Closing Date, the amount set forth opposite such Lender’s name on
Schedule 2.1 as such Lender’s “Term Loan Commitment” and (ii) in
the case of any Lender that becomes a Lender after the Closing Date, the amount
specified as such Lender’s “Term Loan Commitment” in the Assignment Agreement
pursuant to which such Lender assumed such Term Loan.  The aggregate amount of the Term Loan
Commitments as of the Closing Date is $20,000,000.

 

“Term Loan
Commitment Period” means the period from the date of this Agreement
to but excluding the Term Loan Commitment Termination Date.

 

“Term Loan
Commitment Termination Date” means the earliest to occur of (i) the
date the Term Loan Commitments are permanently reduced to zero pursuant to Section 2.10(a) or
Section 2.11, (ii) the eighteen-month anniversary of the Closing Date
and (iii) the date of the termination of the Term Loan Commitments
pursuant to Section 8.1.

 

“Title Policy”
has the meaning set forth in Section 3.1(r).

 

“Track
Business Contingent Earnout Payment”, is as defined in the Agreement
and Plan of Merger, entered into as of December 23, 2002, by and among the
Borrower, Racing Acquisition, Inc., an Ohio corporation and a wholly owned
subsidiary of the Borrower, and Scioto Downs, Inc., an Ohio corporation,
as such agreement is in effect on the Closing Date, without giving effect to
any amendment, supplement or modification thereof.

 

“Trademark
Security Agreement” has the meaning set forth in the Security
Agreements.

 

“UCC”
means the Uniform Commercial Code (or any similar or equivalent legislation) as
in effect in any applicable jurisdiction.

 

“Unrestricted
Subsidiary” means (a) Three Rivers Gaming, Inc, a Pennsylvania
corporation; Keystone State Development, Inc., a Pennsylvania corporation;
Mountaineer Magic, Inc., a West Virginia corporation; Speakeasy Gaming of
Reno, Inc., a Nevada 

 

26

 

corporation;
RacelineBet, Inc., an Oregon corporation, Excal Energy Operating, Inc.,
an Ohio corporation; Mid-America Racing, Inc., an Ohio corporation; Excal
Energy Corporation, a Michigan corporation; Jackson Trotting Association, LLC,
a Michigan limited liability company; Crystal Exploration Co., Inc., a
Michigan corporation; MTR-Harness, Inc., a Minnesota
corporation; Jackson Racing, Inc., a Michigan corporation;
Speakeasy Gaming of Las Vegas, Inc., a Nevada
corporation; ExCal Energy Operating, Inc., an Ohio corporation; SDRS, Inc.,
an Ohio corporation; Keystone Downs, LLC, a Pennsylvania limited liability
company; and Keystone State Properties, LLC, a Pennsylvania limited liability
company; and (b) any subsidiary of an Unrestricted Subsidiary.

 

“Unsuitable Lender” has the
meaning set forth in Section 10.4(e).

 

“Voting Stock”
means with respect to any Person, (a) one (1) or more classes of
Capital Stock of such Person having general voting powers to elect at least a
majority of the board of directors, managers or trustees of such Person,
irrespective of whether at the time Capital Stock of any other class or classes
have or might have voting power by reason of the happening of any contingency,
and (b) any Capital Stock of such Person convertible or exchangeable
without restriction at the option of the holder thereof into Capital Stock of
such Person described in clause (a) of this definition.

 

“Weighted Average Life to
Maturity” means, when applied to any Indebtedness at any date, the
number of years obtained by dividing: (i) the sum of the products obtained
by multiplying (a) the amount of each then remaining installment, sinking
fund, serial maturity or other required payments of principal, including
payment at final maturity, in respect thereof, by (b) the number of years
(calculated to the nearest one-twelfth) that will elapse between such date and
the making of such payment; by (ii) the then outstanding principal amount
of such Indebtedness.

 

“Working
Capital”  means, as at
any date of determination, the excess or deficiency of Current Assets over
Current Liabilities.

 

“Working
Capital Adjustment”  means, for any
period of determination, the amount (which may be a negative number) by which
Working Capital as of the beginning of such period exceeds (or is less than)
the Working Capital as of the end of such period.

 

Section 1.2.                                Accounting Terms. 
Except as otherwise expressly provided herein, all accounting terms not
otherwise defined herein shall have the meanings assigned to them in conformity
with GAAP.  Financial statements and
other information required to be delivered by the Borrower to Lenders pursuant
to Section 5.1(a), 5.1(b) and 5.1(c) shall be prepared in
accordance with GAAP as in effect at the time of such preparation (and
delivered together with the reconciliation statements provided for in Section 5.1(f),
if applicable).  Subject to the
foregoing, calculations in connection with the definitions, covenants and other
provisions hereof shall utilize accounting principles and policies in
conformity with those used to prepare the Financial Statements.

 

27

 

ARTICLE II

Term Loans

 

Section 2.1.                                Term Loans.

 

(a)                                  During the Term Loan Commitment Period, subject to and upon
the terms and conditions hereof and relying on the representations and
warranties set forth herein, each Lender, severally, and not jointly and
severally, agrees to make Term Loans to the Borrower in the aggregate amount up
to but not exceeding such Lender’s Term Loan Commitment.  No Lender shall have an obligation to make a
Term Loan in excess of such Lender’s Pro Rata Share of the Term Loan
Commitment.  Any principal amounts of the
Term Loan subsequently repaid or prepaid may not be re-borrowed.

 

(b)                                 Each Lender’s unfunded Term Loan Commitment shall terminate
immediately and without further action on the Term Loan Commitment Termination
Date.

 

(c)                                  The Term Loans shall (i) bear interest as provided in Section 2.7
hereof and (ii) be entitled to the security interests, Collateral and
other rights and benefits provided pursuant to the other Loan Documents.

 

Section 2.2.                                [Reserved].

 

Section 2.3.                                Borrowing Mechanics.

 

(a)                                  Term Loans that are Base Rate Loans or LIBOR Loans shall be
made, in each case, in an aggregate minimum amount of $1,000,000 and integral
multiples of $1,000,000 in excess of that amount (or such lesser amount as
shall constitute the entire Term Loan Commitment then available).

 

(b)                                 Whenever the Borrower desires that the Lenders make Term
Loans, the Borrower shall deliver to Administrative Agent a fully executed
Borrowing Certificate no later than 12:00 p.m. (New York City time) at
least ten (10) Business Days in advance of the proposed Borrowing Date
(other than the Closing Date), which Borrowing Date shall be a Business Day.

 

(c)                                  Notice of receipt of each Borrowing Certificate in respect
of Term Loans, together with the amount of each Lender’s Pro Rata Share thereof
shall be provided by Administrative Agent to each applicable Lender by
facsimile with reasonable promptness, but (provided, Administrative
Agent shall have received such notice by 10:00 a.m. (New York City time))
not later than 10:00 a.m. (New York City time) on the next Business Day
following Administrative Agent’s receipt of such Borrowing Certificate from the
Borrower.

 

(d)                                 Each Lender shall make the amount of its Term Loan available
to Administrative Agent not later than 12:00 p.m. (New York City time) on
the applicable Borrowing Date by wire transfer of same day funds in Dollars, at
Administrative Agent’s Principal Office. 
Upon satisfaction or waiver of the conditions precedent specified
herein, Administrative Agent shall make the proceeds of such Term Loans
available to the Borrower on the applicable Borrowing Date by causing an amount
of same day funds in Dollars equal to the proceeds of all such Term 

 

28

 

Loans
received by Administrative Agent from Lenders to be credited to an account of
the Borrower designated in writing to Administrative Agent.

 

Section 2.4.                                Pro Rata Shares.  All
Term Loans shall be made by Lenders simultaneously and proportionately to their
respective Pro Rata Share, it being understood that no Lender shall be
responsible for any default by any other Lender in such other Lender’s
obligation to make the Term Loans hereunder.

 

Section 2.5.                                Use of Proceeds.

 

(a)                                  The proceeds of the Term Loans shall be used by the Borrower
solely (i) to finance ongoing working capital and general corporate needs
of the Borrower and its Subsidiaries, (ii) to finance capital expenditures
(including the potential development of the Scioto Downs complex in Columbus,
Ohio and the development of the Presque Isle Downs complex for table games in
Erie, Pennsylvania) and (iii) to pay transaction fees and expenses in
respect of this Agreement and transactions contemplated hereby.  No portion of the proceeds of the Term Loans
shall be used by the Borrower or any Subsidiary of the Borrower in any manner
that might cause such Borrowing or the application of such proceeds to violate
Regulation T, Regulation U or Regulation X of the Board of Governors of the
Federal Reserve System or any other regulation thereof or to violate the Exchange
Act, in each case as in effect on the date or dates of such Borrowing and such
use of proceeds.

 

Section 2.6.                                Evidence of Debt; Register; Notes.

 

(a)                                  Lenders’ Evidence of Debt.  Each Lender shall maintain on its internal
records an account or accounts evidencing the Indebtedness of the Borrower to
such Lender, including the amounts of the Term Loans owed to it and each
repayment and prepayment in respect thereof. 
Any such recordation shall be conclusive and binding on the Borrower,
absent manifest error; provided, failure to make any such recordation,
or any error in such recordation, shall not affect any Lender’s Term Loan
Commitment, Term Loans or the Borrower’s Obligations in respect of any Term
Loans; and provided, further, in the event of any inconsistency
between the Register and any Lender’s records, the recordations in the Register
shall govern.

 

(b)                                 Register.  Administrative Agent shall maintain, as agent
for the Lenders, at Administrative Agent’s Principal Office, a register for the
recordation of the names and addresses of each Lender and the Term Loans owed
to each Lender (the “Register”).  The Register shall be available for
inspection by the Borrower or any Lender at any reasonable time and from time
to time upon reasonable prior notice. 
Administrative Agent shall record in the Register the fees, interest and
the outstanding balance of the Term Loans, and each repayment or prepayment in
respect of the principal amount of and interest, fees and other amounts with
respect to the Term Loans, and any such recordation shall be conclusive and
binding on the Borrower and each Lender, absent manifest error; provided,
failure to make any such recordation, or any error in such recordation, shall
not affect the principal outstanding amount of the Term Loans, or the Borrower’s
Obligations in respect thereto.  No
transfer of the Term Loans and/or any interests therein shall be effective
until such transfer is recorded in the Register.  The Borrower hereby designates the entity
serving as Administrative Agent to serve as the Borrower’s agent solely for
purposes of maintaining the Register as provided in this Section 2.6, 

 

29

 

and
the Borrower hereby agrees that, to the extent such entity serves in such
capacity, the entity serving as Administrative Agent and its officers,
directors, employees, agents and affiliates shall constitute “Indemnified
Persons” pursuant to Section 7.3.

 

(c)                                  Notes.  If so requested by any Lender by written
notice to the Borrower (with a copy to Administrative Agent) prior to the
Closing Date, or at any time thereafter, the Borrower shall execute and deliver
to such Lender (and/or, if applicable and if so specified in such notice, to
any Person who is an assignee of such Lender pursuant to Section 10.4) on
the Closing Date (or, if such request is delivered after the Closing Date,
promptly after the Borrower’s receipt of such request) a promissory note, in
the form of Exhibit B (a “Note”),
to evidence such Lender’s Term Loans.

 

Section 2.7.                                Interest.

 

(a)                                  Applicable Rates.  Except as otherwise set forth herein, the
Term Loans outstanding shall bear interest on the unpaid principal amount
thereof from the date made through repayment (whether by acceleration or
otherwise) at a rate per annum equal to (i) if a LIBOR Loan, LIBOR plus
7.00% per annum and (ii) if a Base Rate Loan, the Base Rate plus
6.00% per annum.

 

(b)                                 Determining the Applicable Rate of Interest.  The basis for
determining the rate of interest with respect to any Term Loan, and the
Interest Period with respect to any LIBOR Loan, shall be selected by the
Borrower and notified to Administrative Agent and Lenders pursuant to the
applicable Borrowing Certificate or Conversion/Continuation Notice, as the case
may be.  If on any day a Term Loan is
outstanding with respect to which a Borrowing Certificate or
Conversion/Continuation Notice has not been delivered to Administrative Agent
in accordance with the terms hereof specifying the applicable basis for
determining the rate of interest, then for that day such Term Loan shall be a
Base Rate Loan.

 

(c)                                  LIBOR Periods.  In connection with LIBOR Loans there shall be
no more than five (5) Interest Periods outstanding at any time.  In the event the Borrower fails to specify
between a Base Rate Loan or a LIBOR Loan in the applicable Borrowing
Certificate or Conversion/Continuation Notice, such Loan (if outstanding as a
LIBOR Loan) will be automatically converted into a Base Rate Loan on the last
day of the then-current Interest Period for such Loan (or if outstanding as a
Base Rate Loan will remain as, or (if not then outstanding) will be made as, a
Base Rate Loan).  In the event the
Borrower fails to specify an Interest Period for any LIBOR Loan in the applicable
Borrowing Certificate or Conversion/Continuation Notice, the Borrower shall be
deemed to have selected an Interest Period of one month.  As soon as practicable after 10:00 a.m.
(New York City time) on each Interest Rate Determination Date, Administrative
Agent shall determine (which determination shall, absent manifest error, be
final, conclusive and binding upon all parties) the interest rate that shall
apply to the LIBOR Loans for which an interest rate is then being determined
for the applicable Interest Period and shall promptly give notice thereof (in
writing or by telephone confirmed in writing) to the Borrower and each Lender.

 

(d)                                 Calculation of Interest Rates.  Interest payable pursuant to Section 2.7(a) shall
be computed on the basis of a  360-day
year  for the actual number of days
elapsed in the period 

 

30

 

during
which it accrues.  In computing interest
on any Term Loan, the date of the making of such Term Loan or the first
Business Day of an Interest Period applicable to such Term or, with respect to
a Base Rate Loan being converted from a LIBOR Loan, the date of conversion of
such LIBOR Loan to such Base Rate Loans, as the case may be, shall be included,
and the date of payment of such Term Loan or the expiration date of an Interest
Period applicable to such Term Loan or, with respect to a Base Rate Loan being
converted to a LIBOR Loan, the date of conversion of such Base Rate Loan to
such LIBOR Loan, as the case may be, shall be excluded; provided, if
such Term Loan is repaid on the same day on which it is made, one day’s
interest shall be paid on such Term Loan.

 

(e)                                  Payment/Accrual of Interest.  Except as otherwise provided herein, all
interest on the Term Loans shall be payable in arrears on (i) each
Interest Payment Date, (ii) any date of  any
prepayment of the Term Loans, whether voluntary or mandatory, to the extent
accrued on the amount being prepaid, and (iii) the Maturity Date.

 

(f)                                    Default Interest.  Upon the occurrence and during the
continuance of an Event of Default described in Section 8.1, the principal
amount of the Term Loans and, to the extent permitted by applicable law, any
past due interest payments on the Term Loans or any fees or other amounts owed
hereunder, in each case whether at stated maturity, by notice of prepayment, by
acceleration or otherwise, shall thereafter bear interest (including, without
limitation, interest, as provided in this Agreement, accruing after the filing
of a petition initiating any insolvency proceedings, whether or not such
interest accrues or is recoverable against the Borrower after the filing of
such petition for purposes of the Bankruptcy Code or is an allowed claim in
such proceeding) payable on demand at a rate that is 2.0% per annum in excess
of the interest rate otherwise payable hereunder with respect to the Term
Loans; provided, in the case of LIBOR Loans, upon the expiration of the
Interest Period in effect at the time any such increase in interest rate is
effective such LIBOR Loans shall thereupon become Base Rate Loans and shall
thereafter bear interest payable upon demand at a rate which is 2.0% per annum
in excess of the interest rate otherwise payable hereunder for Base Rate Loans.
Payment or acceptance of the increased rates of interest provided for in this Section 2.7(f) is
not a permitted alternative to timely payment and shall not constitute a waiver
of any Event of Default or otherwise prejudice or limit any rights or remedies
of Administrative Agent or any Lender.

 

(g)                                 Changed Circumstances.  If the introduction of or any change in or in
the interpretation of (in each case, after the date hereof) any law or
regulation applicable to any Lender makes it unlawful, or any Governmental Body
asserts, after the date hereof, that it is unlawful, for any Lender to perform
its obligations hereunder to maintain the Term Loans at LIBOR, such Lender
shall notify Administrative Agent of such event and Administrative Agent shall
notify the Borrower of such event, and the right of the Borrower to apply LIBOR
to any subsequent Interest Period shall be suspended until Administrative Agent
shall notify the Borrower that the circumstances causing such suspension no
longer exist, and all Term Loans shall be converted from LIBOR Loans to Base
Rate Loans; provided, that if the date of such repayment or proposed
conversion is not the last day of an Interest Period applicable to the Term
Loans, the Borrower shall also pay any amount due pursuant to Section 7.5.

 

31

 

Section 2.8.                                Fees.

 

(a)                                  The Borrower agrees to pay to Administrative Agent on the
Closing Date, solely for its own account, a non-refundable upfront fee equal to
3.00% of the aggregate Term Loan Commitment on the Closing Date.

 

(b)                                 The Borrower agrees to pay to Administrative Agent a
non-refundable agency fee in an amount equal to $50,000  on the Closing Date and on each
anniversary thereof.

 

(c)                                  The Borrower agrees to pay to Administrative Agent, during
the Term Loan Commitment Period, for the account of the Lenders, commitment
fees equal to (i) the average daily amount of Term Loan Commitments that
have not been funded as Term Loans, times (ii) 1.00% per annum.

 

(d)                                 All fees referred to in Section 2.8(c) shall be
calculated on the basis of a 360 day year and the actual number of days elapsed
and shall be payable monthly in arrears on the last Business Day of each
calendar month during the Term Loan Commitment Period, commencing on the first
such date to occur after the Closing Date, and on the Term Loan Commitment
Termination Date.  All fees referred to
in Section 2.8(c) shall be paid to Administrative Agent at its
Principal Office and upon receipt, Administrative Agent shall promptly
distribute to each Lender its Pro Rata Share thereof.

 

Section 2.9.                                Repayment.  Subject to
Sections 2.10 and 2.11, the Term Loans shall be due and payable, and the
Borrower shall be required to repay all of the Obligations (including, without
limitation, all accrued and unpaid principal and interest on the principal
amounts of the Term Loans) on the Maturity Date.

 

Section 2.10.                         Optional Prepayments.

 

(a)                                  Optional Prepayments.  At any time and from time to time the
Borrower may prepay the Term Loans and/or reduce the Term Loan Commitments,
subject to the Applicable Prepayment Premium set forth in Section 2.11(g) below,
on any Business Day in whole or in part, in an aggregate minimum amount of
$1,000,000 and in multiples of $500,000 above such amount (or such lesser
amount as shall constitute the entire amount of the Term Loans then
outstanding).  The Term Loans shall be
prepaid according to each Lender’s Pro Rata Share.

 

(b)                                 Notice of Optional Prepayment.  All such prepayments shall be made on a
Business Day and upon not less than one Business Day’s prior written or
telephonic notice, in each case given to Administrative Agent by 12:00 p.m.
(New York City time) on the date required and, if given by telephone, promptly
confirmed in writing to Administrative Agent (and Administrative Agent will
promptly transmit such telephonic or original notice for the Term Loan by
facsimile or telephone to each Lender). 
Upon the giving of any such notice, the principal amount of the Term
Loan specified in such notice shall become due and payable on the date specified
therein.

 

32

 

Section 2.11.                         Mandatory Prepayments; Mandatory Commitment Reductions.

 

(a)                                  Asset Sales.  No later than five Business Days following
the date of receipt by any Credit Party of any Net Asset Sale Proceeds, the
Borrower shall prepay the Term Loans in an aggregate amount equal to such Net
Asset Sale Proceeds, which prepayment shall be applied to permanently prepay
the Term Loans as set forth in Section 2.12; provided that so long
as no Default or Event of Default shall have occurred and be continuing, the
Borrower shall have the option, directly or through one or more of the
Guarantors, to invest Net Asset Sale Proceeds within one hundred eighty (180)
days of receipt thereof in assets to be used in the business of the Borrower and
its Subsidiaries.

 

(b)                                 Insurance/Condemnation Proceeds.  No later than five
Business Days following the date of receipt by any Credit Party, or
Administrative Agent as loss payee, of any Net Insurance/Condemnation Proceeds,
the Borrower shall prepay the Term Loans in an aggregate amount equal to such
Net Insurance/Condemnation Proceeds, which prepayment shall be applied to
permanently prepay the Term Loans as set forth in Section 2.12; provided
that so long as no Default or Event of Default shall have occurred and be
continuing, the Borrower shall have the option, directly or through one or more
of the Guarantors to invest such Net Insurance/Condemnation Proceeds within one
hundred eighty (180) days of receipt thereof in the repair, restoration or replacement
of the applicable assets thereof or in assets to be used in the business of the
Borrower and its Subsidiaries.

 

(c)                                  Issuance of Equity Securities.  Within five Business Days of the date of
receipt by any Credit Party of any cash proceeds from a capital contribution
to, or the issuance of Capital Stock of any Credit Party or any of its
Subsidiaries (other than Capital Stock (i) issued pursuant to any employee
stock or stock option compensation plan or (ii) the proceeds of which
shall be used in connection with the construction of a Future Gaming Facility
on the SDI Property, provided that with respect to this clause (ii),
prior to the issuance of such Capital Stock, the Borrower shall have delivered
a certificate of an Authorized Officer of the Borrower designating that such
proceeds will be used in such a manner) the Borrower shall permanently prepay
the Term Loans in an aggregate amount equal to 100% of such proceeds, net of
underwriting discounts and commissions and other reasonable costs and expenses
associated therewith, including reasonable legal fees and expenses, which
prepayment shall be applied to permanently prepay the Term Loans as set forth
in Section 2.12.

 

(d)                                 Issuance of Debt.  On the date of receipt by any Credit Party of
any cash proceeds from the incurrence of any Indebtedness of any Credit Party
or any of its Subsidiaries (other than with respect to any Indebtedness
permitted to be incurred pursuant to Section 6.1), the Borrower shall
permanently prepay the Term Loans and/or the Term Loan Commitments shall be
permanently reduced in an aggregate amount equal to 100% of such proceeds, net
of underwriting discounts and commissions and other reasonable costs and
expenses associated therewith, including reasonable legal fees and expenses, which
prepayment shall be applied to permanently prepay the Term Loans and/or reduce
the Term Loan Commitments as set forth in Section 2.12.

 

(e)                                  Consolidated Excess Cash Flow.  In the event there shall be Consolidated
Excess Cash Flow for any Fiscal Year, commencing with the Fiscal Year 2010, the
Borrower shall, no 

 

33

 

later
than ninety days after the end of such Fiscal Year, prepay the Term Loans in an
aggregate amount equal to 50% of such Consolidated Excess Cash Flow, which
prepayment shall be applied to permanently prepay the Term Loans as set forth
in Section 2.12; provided that notwithstanding anything to the
contrary in this paragraph (e), the Borrower shall not be required to make that
portion of a prepayment hereunder to the extent that such prepayment would
cause the aggregate amount of Cash and Cash Equivalents of the Borrower and its
Subsidiaries (excluding (i) any unredeemed winning tickets from their
racing operations, (ii) funds related to horsemen’s fines and certain
simulcasting funds that are restricted to payments for improving horsemen’s
facilities and increasing racing purses at SDI, (iii) short-term
certificate of deposits that serve as collateral for certain bonding
requirements, in each case to the extent permitted herein and (iv) cash
deposits serving as collateral for outstanding letters of credit, to the extent
permitted herein) to be less than $25,000,000 (or if the new SDI gaming
facility is operational, $30,000,000) after giving effect thereto.

 

(f)                                    Prepayment Certificate.  Concurrently with any prepayment of the Term
Loans pursuant to Sections 2.11(a) through 2.11(e) the Borrower shall
deliver to Administrative Agent a certificate of an Authorized Officer
demonstrating the calculation of the amount of the applicable net proceeds or
Consolidated Excess Cash Flow.  In the
event that the Borrower shall subsequently determine that the actual amount
received exceeded the amount set forth in such certificate, the Borrower shall
promptly make an additional prepayment of the Term Loans and/or permanently
reduce the Term Loan Commitments in accordance with Section 2.12 and in an
amount equal to such excess, and the Borrower shall concurrently therewith
deliver to Administrative Agent a certificate of an Authorized Officer
demonstrating the derivation of such excess.

 

(g)                                 Prepayment Premium.  If, pursuant to Section 2.10(a) and
Section 2.11(d), the Borrower prepays all or any part of the principal
balance of the Term Loans and/or any Term Loan Commitment is reduced or
terminated prior to the second anniversary of the Closing Date, the Borrower
shall pay to Administrative Agent, for the benefit of all Lenders entitled to a
portion of such prepayment or reduction a prepayment premium (the “Applicable Prepayment Premium”) on the
amount so prepaid or reduced as follows: (i) if the prepayment or
reduction occurs during the period commencing on the Closing Date but before
the first anniversary of the Closing Date, an amount equal to 1.00% of the
principal amount of the Term Loans being prepaid or Term Loan Commitment being
reduced, as of the prepayment date; (ii) if the prepayment occurs during
the period commencing on the first anniversary of the Closing Date but before
the second anniversary of the Closing Date, an amount equal to 0.50% of the
principal amount of the Term Loans being prepaid or Term Loan Commitment being
reduced, as of the prepayment date; and (iii) if the prepayment occurs on
or after the second anniversary of the Closing Date, an amount equal to $0.

 

Section 2.12.                         Application of Payments

 

(a)                                  Application of Mandatory Prepayments.  Absent a Default or
an Event of Default, any mandatory prepayment of the Term Loans shall be
applied to prepay the Term Loans on a pro rata basis in accordance with the Pro
Rata Share of each Lender together with all accrued and unpaid interest on the
date of such repayment.

 

34

 

(b)                                 Application of Payments following an Event of Default.  Following the
occurrence and during the continuance of an Event of Default, all prepayments
and other payments or proceeds received by Administrative Agent hereunder or
under any Security Document in respect of the Obligations shall be applied as
follows:

 

first, to the
payment of all expenses specified in Section 10.3 and all fees;

 

second, to the
payment of all other Obligations for the ratable benefit of the Lenders; and

 

third, to whomsoever
may be lawfully entitled.

 

(c)                                  For the avoidance of doubt, (i) all references to and
the use of the terms “prepay”, “prepaid”, or “prepayment” shall mean payment of
the Term Loans prior to the original Maturity Date and shall not mean payment
of the Term Loans prior to any accelerated Maturity Date and (ii) any
prepayment premium or prepayment fee required to be paid under this Agreement
shall also be paid upon or after acceleration of the Term Loans.

 

(d)                                 Any prepayment of the Term Loans pursuant to Section 2.10
or Section 2.11 shall be applied first to Base Rate Loans to the full
extent thereof before application to LIBOR Loans, in each case in a manner
which minimizes the amount of any payments required to be made by the Borrower
pursuant to Section 7.5.

 

Section 2.13.                         General Provisions Regarding Payments.

 

(a)                                  Payments.  All payments by the Borrower of principal,
interest, fees and other Obligations shall be made in Dollars in same day
funds, without defense, setoff or counterclaim, free of any restriction or
condition, and delivered to Administrative Agent not later than 2:00 p.m.
(New York City time) on the date due at Administrative Agent’s Principal Office
for the account of Lenders.  All funds
received by Administrative Agent after that time on such due date shall be
deemed to have been paid by the Borrower on the next succeeding Business Day.

 

(b)                                 Non-Conforming Payments.  Administrative Agent shall deem any payment
by or on behalf of the Borrower that is not made in same day funds prior to
2:00 p.m. (New York City time) on the date when due to be a non-conforming
payment.  Any such payment shall not be
deemed to have been received by Administrative Agent until the later of (i) the
time such funds become available funds and (ii) the applicable next
Business Day.  Administrative Agent shall
give prompt telephonic notice (confirmed in writing) to the Borrower and each
applicable Lender if any payment is non-conforming.  To the extent any non-conforming payment may
be deemed to have been received on a date after the date such payment was due
hereunder pursuant to the provisions of the prior sentence, such failure of
such payment to have been made when due will constitute or become a Default or
Event of Default to the extent so provided under the terms of Section 8.1.  Interest shall continue to accrue on any
principal as to which a non-conforming payment is made until such funds become
available funds (but in no event less than the period from the date of such
payment to the next succeeding applicable Business Day) at the rate otherwise
applicable hereunder (including, if applicable, pursuant to Section 2.7(f))
from the date such amount was due and payable until the date such amount is
paid in full.

 

35

 

(c)                                  Payments to Include Accrued Interest.  All payments in
respect of the principal amount of the Term Loans (whether mandatory or
optional) shall include payment of accrued interest on the principal amount
being repaid or prepaid, and all such payments (and, in any event, any payments
in respect of the Term Loans on a date when interest is due and payable with
respect to the Term Loans) shall be applied to the payment of interest before
application to principal.

 

(d)                                 Distributions by Administrative Agent.  Administrative
Agent shall promptly distribute to each Lender, such Lender’s applicable Pro
Rata Share of all payments and prepayments of principal and interest due
hereunder, together with all other amounts due thereto, including, without
limitation, all fees payable with respect thereto, to the extent received by
Administrative Agent.

 

(e)                                  Business Days.  Whenever any payment to be made hereunder
shall be stated to be due on a day that is not a Business Day, such payment
shall be made on the next succeeding Business Day (subject to the definition of
Interest Period) and such extension of time shall be included in the
computation of the payment of interest hereunder.

 

Section 2.14.                         Ratable Sharing. 
Lenders hereby agree among themselves that if any of them shall, whether
by voluntary prepayment (other than a voluntary prepayment of the Term Loans
made and applied in accordance with the terms hereof), through the exercise of
any right of setoff or banker’s lien, by counterclaim or cross-action or by the
enforcement of any right under the Loan Documents or otherwise, or as adequate
protection of a deposit treated as cash collateral under the Bankruptcy Code,
receive payment or reduction of a proportion of the aggregate amount of
principal, interest, fees and other amounts then due and owing to such Lender
hereunder or under the other Loan Documents (collectively, the “Aggregate Amounts Due” to such Lender)
which is greater than the proportion received by any other Lender in respect of
the Aggregate Amounts Due to such other Lender, then the Lender receiving such
proportionately greater payment shall (a) notify Administrative Agent and
each other Lender of the receipt of such payment and (b) apply a portion
of such payment to purchase participations (which it shall be deemed to have
purchased from each seller of a participation simultaneously upon the receipt
by such seller of its portion of such payment) in the Aggregate Amounts Due to
the other Lenders so that all such recoveries of Aggregate Amounts Due shall be
shared by all Lenders in proportion to the Aggregate Amounts Due to them; provided,
if all or part of such proportionately greater payment received by such
purchasing Lender is thereafter recovered from such Lender upon the bankruptcy
or reorganization of the Borrower or otherwise, those purchases shall be
rescinded and the purchase prices paid for such participations shall be
returned to such purchasing Lender ratably to the extent of such recovery, but
without interest.  Each Credit Party
expressly consents to the foregoing arrangement and agrees that any holder of a
participation so purchased may exercise any and all rights of banker’s lien,
setoff or counterclaim with respect to any and all monies owing by any of the
Credit Parties to that holder with respect thereto as fully as if that holder
were owed the amount of the participation held by that holder.

 

36

 

Section 2.15.                         Conversion and Continuation of Term Loans.

 

(a)                                  Subject to Article VII and so long as no Default or
Event of Default shall have occurred and then be continuing, the Borrower shall
have the option

 

(i)                                     to convert at
any time all or any part of any Term Loan equal to $1,000,000 and integral
multiples of $500,000 in excess of that amount from Base Rate Loans to LIBOR
Loans or from LIBOR Loans to Base Rate Loans; provided, a LIBOR Loan may
only be converted on the expiration of the Interest Period applicable to such
LIBOR Loan unless the Borrower shall pay all amounts due under Section 7.5
in connection with any such conversion; or

 

(ii)                                  upon the
expiration of any Interest Period applicable to any LIBOR Loan, to continue all
or any portion of such Loan equal to $1,000,000 and integral multiples of
$500,000 in excess of that amount as a LIBOR Loan.

 

(b)                                 The Borrower shall deliver a Conversion/Continuation Notice
to Administrative Agent no later than 10:00 a.m. (New York City time) at
least one Business Day in advance of the proposed conversion date (in the case
of a conversion to a Base Rate Loan) and at least three Business Days in
advance of the proposed conversion/continuation date (in the case of a
conversion to, or a continuation of, a LIBOR Loan).  Except as otherwise provided herein, a
Conversion/Continuation Notice for conversion to, or continuation of, any LIBOR
Loans (or telephonic notice in lieu thereof) shall be irrevocable on and after
the related Interest Rate Determination Date, and the Borrower shall be bound
to effect a conversion or continuation in accordance therewith.

 

ARTICLE III

Conditions Precedent

 

Section 3.1.                                Conditions Precedent; Closing Date.  The obligation of any Lender to make any Term
Loan and to make the other financial accommodations described herein on the
Closing Date is subject to the satisfaction, or waiver in accordance with Section 10.1,
of the following conditions on or before the Closing Date:

 

(a)                                  Loan Documents.  Administrative Agent shall have received
copies of each Loan Document, including, without limitation, the Credit
Agreement, any Notes, the Security Agreements, the Copyright Security
agreements, the Trademark Security Agreements, the Patent Security Agreements,
the Guaranties, the Stock Pledge Agreements and the Intercreditor Agreement
Joinder, in each case duly executed and delivered.

 

(b)                                 Intercreditor Agreement Requirements. The Grantors (as defined in the Intercreditor Agreement)
shall have delivered to the Second Lien Collateral Agent, with copies to the
Second Lien Trustee and to each previously identified Additional Parity Lien
Facility Representative (as defined in the Intercreditor Agreement) each of the
following:

 

(i)                                     an Officers’
Certificate stating that the Grantors (as defined in the Intercreditor
Agreement) intend to incur such Additional First Lien Indebtedness (as defined
in the Intercreditor Agreement) as Refinancing Indebtedness (as defined in the
Intercreditor Agreement) or Indebtedness under a new First Lien Loan Document
(as defined in the Intercreditor Agreement), and certifying that (A) such
incurrence is 

 

37

 

permitted and does not violate or result in
any default under the Second Lien Note Documents (as defined in the
Intercreditor Agreement) or any then existing Additional Parity Lien Facility
Document (as defined in the Intercreditor Agreement) (other than any incurrence
of First Lien Obligations (as defined in the Intercreditor Agreement) that
would simultaneously repay all First Lien Obligations (as defined in the
Intercreditor Agreement) under the First Lien Loan Documents (as defined in the
Intercreditor Agreement) under which such default would arise) and (B) the
definitive documentation associated with such Additional First Lien
Indebtedness (as defined in the Intercreditor Agreement) contains a written
agreement of the holders of such Indebtedness, for the enforceable benefit of
all holders of existing and future Second Lien Obligations (as defined in the
Intercreditor Agreement), and each existing and future Debt Representative (as
defined in the Intercreditor Agreement) as follows: (x) that the holders
of all obligations associated with such Additional First Lien Indebtedness (as
defined in the Intercreditor Agreement) are bound by the provisions of, and
agree to the terms of, the Intercreditor Agreement (including Section 5.6
of the Intercreditor Agreement) and (y) consenting to and directing
Administrative Agent or other representative with respect to such Additional
First Lien Indebtedness (as defined in the Intercreditor Agreement) to perform
its obligations under the Intercreditor Agreement;

 

(ii)                                  evidence that
the Grantors (as defined in the Intercreditor Agreement) have duly authorized,
executed (if applicable) and recorded (or caused to be recorded), or intend to
authorize, execute and record (if applicable), in each appropriate governmental
office all relevant filings and recordations to ensure that such Additional
First Lien Indebtedness (as defined in the Intercreditor Agreement) is secured
by the First Lien Collateral (as defined in the Intercreditor Agreement) in
accordance with the Intercreditor Agreement and the First Lien Security
Documents (as defined in the Intercreditor Agreement) (including any opinions
reasonably requested by Administrative Agent to confirm the validity and
perfection of the First Lien Secured Parties’ (as defined in the Intercreditor
Agreement) Liens (as defined in the Intercreditor Agreement) in the First Lien
Collateral (as defined in the Intercreditor Agreement) after giving effect to
such Additional First Lien Indebtedness (as defined in the Intercreditor
Agreement));

 

(iii)                               a written
notice specifying the name and address of Administrative Agent or
representative in respect of such Additional First Lien Indebtedness (as
defined in the Intercreditor Agreement) for purposes of Section 9.9 of the
Intercreditor Agreement; and

 

(iv)                              a copy of the
executed First Lien Joinder (as defined in the Intercreditor Agreement),
executed by Administrative Agent (on behalf of each Secured Party).

 

(c)                                  [Reserved].

 

(d)                                 Secretary’s Certificate.  Administrative Agent shall have received a
certificate of the secretary or assistant secretary, the manager or the general
partner, as the case may be, of each Credit Party with respect to (i) the
certificate of incorporation, the articles of incorporation, the certificate of
formation or other organizational documents, as the case may be, of such Credit
Party, each as amended or amended and restated to date, (ii) the
regulations, bylaws, operating agreement or limited partnership agreement, as
the case may be, of such Credit Party, each as 

 

38

 

amended
or amended and restated to date, (iii) the resolutions of the board of
directors, manager or general partner, as the case may be, of such Credit Party
approving each Loan Document to which such Credit Party is a party and the
other documents to be delivered by such Credit Party under the Loan Documents
and the performance of the obligations of such Credit Party thereunder, and (iv) the
names and true signatures of the officers of such Credit Party or such other
persons authorized to sign each Loan Document to which such Credit Party is a
party and the other documents to be delivered by it under the Loan Documents.

 

(e)                                  Good Standing Certificates.  Administrative Agent shall have received a
good standing certificate from the applicable Governmental Body of each Credit
Party’s jurisdiction of incorporation, organization or formation and in each
jurisdiction in which it is qualified as a foreign corporation or other entity
to do business, each dated a recent date prior to the Closing Date.

 

(f)                                    Existing Indebtedness.  On the Closing Date, the Credit Parties shall
have (i) repaid in full all Indebtedness and other obligations under the
Existing Agreement, (ii) terminated any commitments to lend or make other
extensions of credit thereunder, (iii) delivered to Administrative Agent
all documents or instruments necessary to release all Liens securing the
Existing Indebtedness or other obligations of the Credit Parties thereunder
being repaid on the Closing Date, and (iv) made arrangements reasonably
satisfactory to Administrative Agent with respect to the letters of credit
outstanding thereunder.

 

(g)                                 Financial Statements; Projections.  Administrative
Agent shall have received from the Borrower (i) the Financial Statements
and (ii) the Projections.

 

(h)                                 Minimum Consolidated EBITDA.  The Financial Statements shall demonstrate in
form and substance reasonably satisfactory to Administrative Agent that as of January 31,
2010, the Borrower shall have generated trailing twelve month Consolidated
EBITDA of at least $50,000,000.

 

(i)                                     Maximum Leverage Ratio.  The Financial Statements shall demonstrate in
form and substance reasonably satisfactory to Administrative Agent that the
Leverage Ratio for the twelve-month period ending on January 31, 2010
shall not be greater than 5.75:1.0.

 

(j)                                     Evidence of Insurance.  Administrative Agent shall have received a
certificate from the Borrower’s insurance broker or other evidence reasonably
satisfactory to it that all insurance required to be maintained pursuant to Section 5.8
is in full force and effect and that Administrative Agent, for the benefit of
Lenders and Administrative Agent, has been named as additional insured and loss
payee, as applicable, thereunder.

 

(k)                                  Closing Date Certificate.  Administrative Agent shall have received an
originally executed Closing Date Certificate, from the Borrower, together with
any attachments thereto.

 

(l)                                     Solvency Certificate.  On the Closing Date, Administrative Agent
shall have received a Solvency Certificate from the Borrower  dated as of the Closing Date and addressed
to Administrative Agent and Lenders, and in form, scope and substance
reasonably satisfactory to Administrative Agent, with appropriate attachments
and demonstrating that after giving effect to 

 

39

 

the
Borrowing to be made on the Closing Date, each of the Borrower  and its Subsidiaries on a consolidated
basis is and will be Solvent.

 

(m)                               Financing Statements.  Administrative Agent shall have received UCC
financing statements duly authorized by each applicable Credit Party with
respect to all personal, real and mixed property Collateral of such Credit
Party, for filing in all jurisdictions as may be necessary or, in the opinion
of the Lenders, desirable, to perfect the security interests created in such
Collateral pursuant to the Security Documentation.

 

(n)                                 Collateral Questionnaire.  Administrative Agent shall have received a
completed Collateral Questionnaire dated the Closing Date and executed by an
Authorized Officer of each Credit Party, together with all attachments
contemplated thereby, including (A) the results of a recent search, by a
Person reasonably satisfactory to Administrative Agent, of all effective UCC
financing statements (or equivalent filings) made with respect to any personal
or mixed property of any Credit Party in the jurisdictions specified in the
Collateral Questionnaire, together with copies of all such filings disclosed by
such search, and (B) UCC termination statements (or similar documents)
duly authorized by all applicable Persons for filing in all applicable
jurisdictions as may be necessary to terminate any effective UCC financing
statements (or equivalent filings) disclosed in such search (other than any
such financing statements in respect of Permitted Liens).

 

(o)                                 Security Collateral.  Administrative Agent shall have received the
certificates, instruments and promissory notes (which certificates, instruments
and promissory notes shall be accompanied by instruments of transfer or
assignment duly endorsed in blank and otherwise in form and substance
reasonably satisfactory to Administrative Agent) representing or evidencing all
security collateral pledged pursuant to the Security Documentation.

 

(p)                                 Other Actions to Perfect Security Interests.  Administrative
Agent shall have received evidence that each Credit Party has authorized
Administrative Agent or shall have taken or caused to be taken any other
action, executed and delivered or caused to be executed and delivered any other
agreement, document and instrument, and made or caused to be made any other
filing and recording (other than as set forth herein) reasonably required by
Administrative Agent to perfect its security in the Collateral, including the
filing of the financing statements related to perfection of the security
interest of Administrative Agent in the Collateral in all appropriate
jurisdictions.

 

(q)                                 Opinion of Counsel.  Administrative Agent shall have received an
originally executed copy of the favorable written opinions of (i) Milbank
Tweed Hadley & McCloy LLP, counsel for the Credit Parties and (ii) Ruben &
Aronson, LLP, counsel for the Credit Parties, in each case, as to such matters
as Administrative Agent may reasonably request, dated as of the Closing Date,
and in form and substance reasonably satisfactory to Administrative Agent.

 

(r)                                    Real Estate Assets.  In order to create in favor of Administrative
Agent, for the benefit of Secured Parties, a valid and, subject to any filing
and/or recording referred to herein, perfected first priority security interest
in the Credit Parties’ real estate assets (subject to Permitted Liens),
Administrative Agent shall have received from the Borrower and each applicable
Guarantor:

 

40

 

(i)                                     fully executed
and notarized Mortgages, in proper form for recording in all appropriate places
in all applicable jurisdictions, encumbering each real estate asset listed in Schedule
3.1(r) (each, a “Closing Date
Mortgaged Property”);

 

(ii)                                  an opinion of
counsel (which counsel shall be reasonably satisfactory to Administrative
Agent) in each state in which a Closing Date Mortgaged Property is located with
respect to the enforceability of the form(s) of Mortgages to be recorded
in such state and such other matters as Administrative Agent may reasonably
request, in each case in form and substance reasonably satisfactory to
Administrative Agent;

 

(iii)                               (a) ALTA
mortgagee title insurance policies or unconditional commitments therefor issued
by one or more title companies reasonably satisfactory to Administrative Agent
with respect to each Closing Date Mortgaged Property (each, a “Title Policy”), in amounts not less than
the fair market value of each Closing Date Mortgaged Property, together with a
title report issued by a title company with respect thereto, dated not more
than thirty days prior to the Closing Date and copies of all recorded documents
listed as exceptions to title or otherwise referred to therein, each in form
and substance reasonably satisfactory to Administrative Agent and (B) evidence
satisfactory to Administrative Agent that such Credit Party has paid to the
title company or to the appropriate Governmental Body all expenses and premiums
of the title company and all other sums required in connection with the
issuance of each Title Policy and all recording and stamp taxes (including
mortgage recording and intangible taxes) payable in connection with recording
the Mortgages for each Closing Date Mortgaged Property in the appropriate real
estate records; and

 

(iv)                              ALTA surveys of
all Closing Date Mortgaged Properties, certified to Administrative Agent.

 

(s)                                  [Reserved].

 

(t)                                    Gaming Licenses.  The Credit Parties shall have all Gaming
Licenses material to or required for the conduct of its gaming businesses and
the conduct of games of chance at each Hotel/Casino Facility and such Gaming
Licenses shall not then be suspended, enjoined or prohibited (for any length of
time) by any Gaming Authority or any other Governmental Body.

 

(u)                                 Fees and Expenses.  The Borrower shall have paid all fees and
expenses (including attorneys’ fees) and out of pocket expenses of the Lenders
and Administrative Agent incurred in connection with this Agreement and the
other Loan Documents.

 

(v)                                 Consents.  The Lenders shall have received such Consents
and other information, approvals, opinions or documents reasonably requested by
Administrative Agent or the Lenders in connection with the making of any Term
Loan and the granting of any security interest, on the Closing Date, including,
without limitation, the consent of National City Bank with respect to obtaining
a Mortgage in favor of Administrative Agent on the SDI Property.

 

(w)                               Use of Proceeds.  The Borrower shall have confirmed in writing
that the proceeds of the Term Loans shall be used only in accordance with the
provisions of Section 2.5.

 

41

 

(x)                                   No Litigation.  There shall not exist any action, suit,
investigation, litigation or proceeding or other legal or regulatory
developments, pending or threatened in any court or before any arbitrator or
Governmental Body that, in the reasonable opinion of Administrative Agent,
singly or in the aggregate, materially impairs any of the transactions
contemplated by the Loan Documents or that could have a Material Adverse
Effect.

 

(y)                                 Due Diligence.  Other than changes occurring in the ordinary
course of business, no information or materials are or should have been
available to the Borrower  and its
Subsidiaries as of the Closing Date that are materially inconsistent with the
material previously provided to Administrative Agent for its due diligence
review of the Borrower  and its
Subsidiaries.

 

(z)                                   No Material Adverse Effect.  No Material Adverse Effect shall have
occurred after giving effect to the Term Loans made on the Closing Date.

 

Section 3.2.                                Conditions to all Term Loans.  The obligation of each Lender to make any
Term Loan, on any date, including the Closing Date, is subject to the
satisfaction, or waiver of the following conditions precedent:

 

(i)                                     Administrative
Agent shall have received a fully executed and delivered Borrowing Certificate;
provided that the Borrowing Certificate delivered in connection with the
Borrowing to be made on the Closing Date shall request that no less than
$10,000,000 of Term Loans be made on the Closing Date.

 

(ii)                                  after making
the Term Loans requested on such date, the Term Loans outstanding shall not
exceed the Term Loan Commitments then in effect;

 

(iii)                               as of such
date, the representations and warranties contained herein and in the other Loan
Documents shall be true and correct in all material respects on and as of such
date to the same extent as though made on and as of that date, except to the
extent such representations and warranties specifically relate to an earlier
date, in which case such representations and warranties shall have been true
and correct in all material respects on and as of such earlier date; and

 

(iv)                              at the time of
and after giving effect to the Borrowing, the Borrower is in pro forma
compliance with the financial covenants set forth in Section 6.14; and

 

(v)                                 as of such
date, no event shall have occurred and be continuing or would result from the
borrowing of the Term Loan that constitutes an Event of Default or a Default.

 

ARTICLE IV

Representations and Warranties

 

Section 4.1.                                Representations and Warranties.  In order to induce Administrative Agent and
the Lenders to enter into this Agreement and to make the Borrowing on the
Closing Date and on the date of each other Borrowing, each Credit Party hereby
represents and warrants 

 

42

 

(to the extent such
representation or warranty is applicable to such Credit Party) to
Administrative Agent and each Lender as follows on the Closing Date:

 

(a)                                  Corporate Status; Corporate Authorization.  Each Credit Party
is duly organized, validly existing, and in good standing under the laws of its
jurisdiction of organization and is duly qualified and in good standing in
every other jurisdiction where it is doing business except where the failure to
so qualify does not have a Material Adverse Effect on it, and the execution,
delivery and performance by each Credit Party of the Loan Documents (i) are
within its respective authority, (ii) have been duly authorized and (iii) do
not conflict with or contravene its respective corporate governance
documents.  The execution, delivery,
performance of their respective obligations and exercise of their respective
rights under the Loan Documents by each Credit Party party thereto, including,
without limitation, the making of the Term Loans under this Agreement, (i) do
not require any Consents that have not been obtained (other than any Consents
for which the failure to obtain would not have a Material Adverse Effect) and (ii) are
not and will not be in conflict with or prohibited or prevented by (A) any
Regulation or (B) any corporate governance document, corporate minute or
resolution or (C) any instrument, agreement or provision thereof, in each
case binding on any of them or affecting any of their property except as would
not be reasonably expected to have a Material Adverse Effect;

 

(b)                                 Execution and Binding Effect.  Upon execution and delivery thereof, each
Loan Document shall constitute the legal, valid and binding obligation of each
Credit Party which is a party thereto, enforceable in accordance with its
terms, except as the enforceability thereof may be limited by bankruptcy,
insolvency or other similar laws relating to the enforcement of creditors’
rights generally and by general equitable principles;

 

(c)                                  Properties.

 

(i)                                     Each Credit
Party has good and marketable title to all material real property owned or
purported to be owned by it, in each case free of all Liens other than
Permitted Liens.

 

(ii)                                  Each Credit
Party is in lawful possession of a valid and subsisting leasehold estate in and
to its Leasehold Properties which it purports to lease free and clear of all
Liens other than Permitted Liens.

 

(iii)                               Each Credit
Party enjoys peaceful and undisturbed possession of, or a license to use, all
property (subject only to the Permitted Liens) that is necessary for their
respective businesses.

 

(iv)                              Set forth on Schedule
4.1(c) is a list, as of the date hereof, of all real property held,
or, to the Knowledge of any Credit Party, planned to be held, by any Credit
Party, indicating in each case whether the respective property is (or is
expected to be) owned or leased, the identity of the owner or lessee, the
location of the respective property, in the case of real property owned and, in
the case of property not yet owned or leased, the estimated date of acquisition
or leasing (if known to such Credit Party on the date hereof).

 

43

 

(v)                                 Each Credit
Party owns, or is licensed or otherwise has the right to use the Intellectual
Property necessary to own and operate its properties and to carry on its
business as presently conducted and presently planned to be conducted without
conflict with the rights of others, except for such instances of non-compliance
that, individually or in the aggregate, could not reasonably be expected to
have a Material Adverse Effect.

 

(d)                                 Financial Statements; Projections.

 

(i)                                     The Financial
Statements were prepared in conformity with GAAP and fairly present, in all
material respects, the financial position, on a consolidated basis, of the
Persons described in such financial statements as at the respective dates
thereof and the results of operations and cash flows, on a consolidated basis,
of the entities described therein for each of the periods then ended, subject,
in the case of any such unaudited financial statements, to changes resulting
from audit and normal year-end adjustments (except in the case of the Financial
Statements for the interim period from January 1, 2010 to the last day of
the month most recently ended prior to the Closing Date, for the lack of footnotes).  As of the Closing Date, neither the Borrower
nor any of its Subsidiaries has any contingent liability or liability for
taxes, long-term lease or unusual forward or long-term commitment that is not
reflected in the Financial Statements or the notes thereto and which in any
such case is required by GAAP set forth therein.

 

(ii)                                  On and as of
the Closing Date, the Projections of the Borrower  and its Subsidiaries is based on good faith estimates and
assumptions made by the management of the Borrower; provided that the
Projections are not to be viewed as fact and that actual results during the
period or periods covered by the Financial Plan may differ from such Financial
Plan and that the differences may be material.

 

(e)                                  Absence of Material Adverse Effect.  There has been no
act, condition or event which has had or is reasonably likely to have a
Material Adverse Effect since December 31, 2009.

 

(f)                                    Litigation.  There are no legal or other proceedings or
investigations pending or, to the Knowledge of the Borrower, threatened against
any Credit Party before any court, tribunal or regulatory authority which
would, if adversely determined, alone or together, have a Material Adverse
Effect.

 

(g)                                 Governmental Approvals and Filings.  No approval, order,
consent, authorization, certificate, license, permit or validation of, or
exemption or other action by, or filing, recording or registration with, or
notice to, any Governmental Body which has not been obtained is or will be
necessary in connection with the execution and delivery of this Agreement or
any other Loan Document, consummation by the Credit Parties of the transactions
herein or therein contemplated, or performance of or compliance with the terms
and conditions hereof or thereof, other than the filings and recordations
contemplated by the Security Documentation. 
No Credit Party is subject to regulation under the Public Utility
Holding Company Act of 2005, the Federal Power Act, the Interstate Commerce Act
or the Investment Company Act of 1940 or to any federal, state or provincial
statute or regulation limiting the ability of the Borrower to incur
Indebtedness for money borrowed.  No
Credit Party is an “investment company” or a company 

 

44

 

“controlled”
by an “investment company”, within the meaning of the Investment Company Act of
1940, as amended.

 

(h)                                 Absence of Conflicts.  The execution and delivery by each Credit
Party of this Agreement and each other Loan Document to which it is a party and
performance by it hereunder and thereunder will not violate any law (including,
without limitation, Regulations T, U and X of the Federal Reserve Board).  Except as would not be reasonably expected to
have a Material Adverse Effect, the execution and delivery by each Credit Party
of this Agreement and each other Loan Document to which it is a party and
performance by it hereunder and thereunder, will not conflict with or result in
a breach of any order, writ, injunction, resolution, decree or other similar
document or instrument of any court or Governmental Body or its certificate of
incorporation or by-laws or similar constituent documents or create (with or
without the giving of notice or lapse of time, or both) a default under or
breach of any material agreement, bond, note or indenture, in each case to
which it is a party (by successor in interest or otherwise), or by which it is
bound or any material portion of its properties or assets is affected, or,
except under the Security Documentation, result in the imposition of any Lien
(other than Permitted Liens) of any nature whatsoever upon any of the
properties or assets owned by or used in connection with the business of the
Borrower  and its Subsidiaries.

 

(i)                                     Collateral.  From and after the execution and delivery of
the Security Documentation and the filing of the documents thereby required,
Administrative Agent, on behalf of the Secured Parties, shall have a
first-priority perfected security interest in and to all of the Collateral,
free and clear of any Liens other than the Permitted Liens, and entitled to
priority under applicable law, with no financing statements, hypothecs, chattel
mortgages, real estate mortgages or similar filings on record anywhere other
than such filings in connection with this Agreement, the Security Documentation
or the Permitted Liens.  Each of the
representations and warranties made by each Credit Party in the Security
Documentation to which it is a party is true and correct in all material
respects as of each date made or deemed made.

 

(j)                                     Partnerships, Etc.  Except as set forth on Schedule 4.1(j),
no Credit Party is a partner (general or limited) of any partnership, is a
party to any joint venture or owns (beneficially or of record) any equity or
similar interest in any similar Person (including, without limitation, any
interest pursuant to which any Credit Party has or may in any circumstance have
an obligation to make capital contributions to, or be generally liable for or
on account of the liabilities, acts or omissions of such other Person).

 

(k)                                  Fiscal Year.  Each Fiscal Year of each of the Credit
Parties ends on December 31 of each calendar year.

 

(l)                                     [Reserved].

 

(m)                               Capitalization.

 

(i)                                     Each Credit
Party is the record and beneficial owner of all of the issued and outstanding
shares of Capital Stock of each of the Subsidiaries listed on Schedule 4.1(m) as
being owned by such Credit Party and there are no proxies, irrevocable or
otherwise, with respect to such shares and no equity securities of any of the 

 

45

 

Subsidiaries are or may become required to be
issued by reason of any options, warrants, rights to subscribe to, calls or
commitments of any kind or nature and there are no contracts, commitments,
understandings or arrangements by which any Subsidiary is or may become bound
to issue additional shares of its Capital Stock or securities convertible into
or exchangeable for such shares.

 

(ii)                                  As of the
Closing Date, the issued and outstanding shares of Capital Stock of each Credit
Party have been duly authorized and are fully paid and non-assessable, and,
except with respect to the Borrower, are free and clear of all claims, liens,
pledges and encumbrances of any kind, except as disclosed in writing to
Administrative Agent prior to the date hereof.

 

(iii)                               The Credit
Parties on a consolidated basis are Solvent and will continue to be Solvent
after the creation of the Obligations, the security interests of Administrative
Agent and the other transaction contemplated hereunder.

 

(n)                                 Material Misstatements and Omissions.  There are no facts
pertaining to any Credit Party, their assets or properties or their businesses
which, individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect and which have not been disclosed in this
Agreement.  None of the representations
or warranties of any Credit Party contained in the Loan Documents is untrue or
incorrect in any material respect when made and on the Closing Date.  There is no information, as of the Closing
Date, which would contradict or is inconsistent in any material respect with
any representation or warranty of any Credit Party contained in the Loan
Documents.

 

(o)                                 Labor Practices.  No Credit Party is engaged in any unfair
labor practice that could reasonably be expected to have a Material Adverse
Effect.  There is no (i) unfair
labor practice complaint pending against any Credit Party or threatened against
any Credit Party before the National Labor Relations Board and no grievance or
arbitration proceeding arising out of or under any collective bargaining
agreement that is so pending against any Credit Party or threatened against any
Credit Party, (ii) strike or work stoppage in existence or threatened
involving any Credit Party, and (iii) union representation question
existing with respect to the employees of any Credit Party, as the case may be,
and no union organization activity that is taking place, except (with respect
to any matter specified in clause (i), (ii) or (iii) above, either
individually or in the aggregate) such as is not reasonably likely to have a
Material Adverse Effect.

 

(p)                                 Employee Benefits.  Except as set forth on Schedule 4.1(p),
neither the Borrower, any Subsidiary of the Borrower or any of their respective
ERISA Affiliates sponsors, maintains or contributes to any Pension Plan or a
Multiemployer Plan.  Each Credit Party is
in substantial compliance with all applicable provisions and requirements of
ERISA and the Internal Revenue Code and the regulations and published
interpretations thereunder with respect to each Employee Benefit Plan, and have
performed all of their obligations under each Employee Benefit Plan, except
where such noncompliance and/or failure to perform such obligations could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.  Each Employee Benefit
Plan which is intended to qualify under Section 401(a) of the
Internal Revenue Code is so qualified. 
Except as set forth on Schedule 4.1(p) or to the extent
required under 

 

46

 

Section 4980B
of the Internal Revenue Code or similar state laws, no Employee Benefit Plan
provides health or welfare benefits (through the purchase of insurance or
otherwise) for any retired or former employee of any Credit Party.

 

(q)                                 Environmental Matters.

 

(i)                                     No Credit Party
has any Environmental Liabilities at any Relevant Property, which individually
or in the aggregate, could reasonably be expected to have a Material Adverse
Effect.

 

(ii)                                  Each Credit
Party:  (A) has operated its
business in compliance with all applicable Environmental Laws; (B) has
obtained all Environmental Permits required by applicable Environmental Laws
for the ownership and operation of its properties, and all such Environmental
Permits are in full force and effect or such Person has made all appropriate
filings for issuance or renewal of such Environmental Permits; (C) is not
aware of any acts, omissions, events or circumstances that may interfere with
or prevent continued compliance with the Environmental Laws and Environmental
Permits referred to in the preceding clauses (A) and (B); (D) has not
received written notice of any asserted or threatened claim, action, suit,
proceeding, hearing, investigation or written request for information relating
to any environmental matter; and (E) has not received notice from any
Governmental Body that any Credit Party is a potentially responsible party
under any Environmental Law at any disposal site containing Hazardous
Materials, nor does there exist any lien under any Environmental Law against
any property of any Credit Party, except in each case of (A) through (E) above,
for such matters that, individually or in the aggregate, could not reasonably
be expected to have a Material Adverse Effect.

 

(r)                                    Insurance.  The policies, binders or self-insurance
programs for fire, liability, product liability, workmen’s compensation,
vehicular and other insurance currently held by or on behalf of each Credit
Party insure their respective material properties and business activities
against such losses and risks as are adequate to protect its properties in
accordance with customary industry practice when entered into or renewed.  As of the date hereof, all such policies,
binders and self-insurance programs are in full force and effect.  As of the date hereof, no Credit Party has
received notice from any insurer or agent of such insurer that substantial
capital improvements or other expenditures are required.  As of the date hereof, no Credit Party has
received notice of cancellation of any material insurance policy or binder.

 

(s)                                  Intellectual Property.  Each Credit Party owns or licenses or
otherwise has the right to use all Intellectual Property necessary for the
operation of its business as presently conducted.  As of the date hereof, the Credit Parties do
not have any Intellectual Property registered, or subject to pending
applications, in the United States Patent and Trademark Office or any similar
office or agency in the United States, any State thereof, any political
subdivision thereof or in any other country, other than those described in Schedule 4.1(s) and
have not granted any licenses with respect thereto other than as set forth in Schedule
4.1(s).  To the Knowledge of the
Credit Parties, no event has occurred which permits or would permit after
notice or passage of time or both, the revocation, suspension or termination of
such rights.  Except as set forth on Schedule
4.1(s), to the Knowledge of any Credit Party, no slogan or other 

 

47

 

advertising
device, product, process, method, substance or other Intellectual Property or
goods bearing or using any Intellectual Property presently contemplated to be
sold by or employed by any Credit Party infringes any patent, trademark,
servicemark, tradename, copyright, license or other Intellectual Property owned
by any other Person presently and no claim or litigation is pending or
threatened against or affecting any Credit Party contesting its right to sell
or use any such Intellectual Property.  Schedule
4.1(s) sets forth all of the material agreements or other material
arrangements of each Credit Party pursuant to which, as of the Closing Date,
such Credit Party has a license or other right to use any trademarks, logos, designs,
representations or other Intellectual Property owned by another Person as in
effect on the date hereof (other than any “shrink-wrap”, “click-wrap” and other
non-negotiable standard end-user software license agreements) (collectively,
together with such agreements or other arrangements as may be entered into by
any Credit Party after the date hereof, collectively, the “License Agreements” and individually, a “License Agreement”).  As of the date hereof, all license and
related rights are in full force and effect, no default or event of default
exists with respect thereto in respect of the obligations of licensor or with
respect to any royalty or other payment obligations of any Credit Party or any
obligations of any Credit Party with respect to manufacturing standards,
quality control or specifications and each Credit Party thereto is in
compliance with the terms thereof and no owner, licensor or other party thereto
has sent any notice of termination or its intention to terminate such license
or rights except in each case as would not reasonably be expected to result in
a Material Adverse Effect.

 

(t)                                    Absence of Events of Default.  No event has occurred and is continuing and
no condition exists which constitutes an Event of Default.

 

(u)                                 Absence of Other Defaults.  No Credit Party is in default under any
agreement, ordinance, resolution, decree, bond, note, indenture, order or
judgment to which it is a party (by successor in interest or otherwise) or by
which it is bound, or any other agreement or other instrument by which any of
the properties or assets owned by it or used in the conduct of its business is
affected, which individually or in the aggregate would have a Material Adverse
Effect.  Each Credit Party has complied
and is in compliance in all respect with all laws, except for such instances of
non-compliance that, individually or in the aggregate, could not reasonably be
expected to have a Material Adverse Effect.

 

(v)                                 Material Contracts.  Schedule 4.1(v) sets forth a
true, correct and complete list and description of all the Material Contracts,
as of the Closing Date, to which each Credit Party is a party.  No Credit Party is in default in the
performance, observance or fulfillment of any of its obligations, covenants or
conditions contained in any of the Material Contracts, and no condition exists
which, with the giving of notice or the lapse of time or both, could constitute
such a default, except where the consequences, direct or indirect, of such
default or defaults, if any, could not reasonably be expected to have a
Material Adverse Effect.

 

(w)                               Brokerage Fees.  Except as set forth on Schedule 4.1(w),
no broker’s or finder’s fee or commission will be payable with respect to the
execution and delivery of this Agreement and the other Loan Documents, and no
other similar fees or commissions will be payable by the Credit Parties for any
other services rendered to the Credit Parties ancillary to the credit
transactions contemplated herein.

 

48

 

(x)                                   Margin Regulations.  No part of the proceeds of the Term Loans
borrowed hereunder will be used for the purpose of buying or carrying any
Margin Stock or to extend credit to others for the purpose of buying or
carrying any Margin Stock, in either case in a manner which would violate or
conflict with Regulations T, U or X of the Board Governors of the Federal
Reserve System.  No Credit Party is
engaged in the business of extending credit to others for the purpose of buying
or carrying Margin Stock.  Neither the making
of the Term Loans nor any use of proceeds of any such Term Loans will violate
or conflict with the provisions of Regulations T, U or X of the Board of
Governors of the Federal Reserve System, as amended from time to time.

 

(y)                                 Taxes.  Each Credit Party has filed all federal and
other material Tax returns required to be filed by it and has not failed to pay
any material taxes, or interest and penalties relating thereto, on or before
the due dates thereof except for Taxes not yet due and except for those the
amount or validity of which is currently being contested in good faith by
appropriate proceedings.  Except as may
be previously disclosed to Administrative Agent and to the extent that reserves
therefor are reflected in the Financial Statements, (i) there are no
material federal, state or local tax liabilities of any Credit Party due or to
become due for any tax year ended on or prior to the date hereof relating to
any Credit Party, which are not reflected in the Financial Statements in
accordance with GAAP, and (ii) there are no material claims pending,
proposed or threatened in writing against any Credit Party for past federal,
state or local taxes, except those, if any, as to which proper reserves in
accordance with GAAP are reflected in such Financial Statements.

 

(z)                                   USA Patriot Act; Etc.  Each Credit Party is in compliance in all
material respects with the USA Patriot Act (Title III of Pub.L. 107-56 (signed
into law October 26, 2001)).  No
part of the proceeds of the extensions of credit hereunder will be used,
directly or indirectly, for any payments to any governmental official or
employee, political party, official of a political party, candidate for
political office or anyone else acting in an official capacity, in order to
obtain, retain or direct business or obtain any improper advantage, in
violation of the federal Foreign Corrupt Practices Act of 1977.

 

(aa)                            Gaming Licenses.  All Gaming Licenses required to be held by
the Credit Parties are current and in good standing and the Credit Parties presently
hold all Gaming Licenses necessary for the continued operation of the
Hotel/Casino Facilities.

 

(bb)                          Non-Core Land/Unrestricted Subsidiaries.  Except as set forth
on Schedule 4.1(bb), no Credit Party conducts any business on any property that
is classified as Non-Core Land other than business that is immaterial, related
to and incidental to the Credit Parties’ business as of the Closing Date.  Except as set forth on Schedule 4.1(bb), no
Unrestricted Subsidiary conducts any business with any Credit Party.  The value of the cumulative assets of the
Unrestricted Subsidiaries is less than $1,000,000.

 

49

 

ARTICLE V

Affirmative Covenants

 

Each Credit Party covenants
and agrees that so long as the Term Loans or any other Obligation shall remain
unpaid or unsatisfied, each Credit Party shall perform, and shall cause each of
its Subsidiaries to perform, all the covenants in this Article V:

 

Section 5.1.                                Basic Reporting Requirements.  The Borrower shall furnish to Administrative
Agent and the Lenders:

 

(a)                                  Annual Financial Statements.  As soon as available, and in any event within
ninety (90) days after the end of each Fiscal Year, (i) the consolidated
and consolidating balance sheets of the Borrower and its Subsidiaries as at the
end of such Fiscal Year and the related consolidated and consolidating
statements of income, stockholders’ equity and cash flows of the Borrower and
its Subsidiaries for such Fiscal Year, together with a Financial Officer
Certification with respect thereto; and (ii) with respect to such
consolidated financial statements a report thereon of Ernst & Young,
LLP or other independent certified public accountants of recognized standing
selected by the Borrower, and reasonably satisfactory to Administrative Agent
(which report shall be unqualified as to going concern and scope of audit, and
shall state that such consolidated financial statements fairly present, in all
material respects, the consolidated financial position of the Borrower and its
Subsidiaries as at the dates indicated and the results of their operations and
their cash flows for the periods indicated in conformity with GAAP and that the
examination by such accountants in connection with such consolidated financial
statements has been made in accordance with generally accepted auditing
standards) together with a written statement by such independent certified
public accountants stating (1) that their audit examination has included a
review of Section 6.14 (Financial Covenants), (2) whether, in
connection therewith, any condition or event that constitutes a Default or an
Event of Default has come to their attention and, if such a condition or event
has come to their attention, specifying the nature and period of existence
thereof, and (3) that nothing has come to their attention that causes them
to believe that the information contained in any Compliance Certificate is not
correct or that the matters set forth in such Compliance Certificate are not
stated in accordance with the terms hereof;

 

(b)                                 Quarterly Financial Statements.  As soon as
available, and in any event within forty-five (45) days after the end of each
Fiscal Quarter of each Fiscal Year (including the fourth Fiscal Quarter), the
consolidated and consolidating balance sheets of the Borrower and its
Subsidiaries as at the end of such Fiscal Quarter and the related consolidated
and consolidating statements of income, stockholders’ equity and cash flows of
the Borrower and its Subsidiaries for such Fiscal Quarter and for the period
from the beginning of the then current Fiscal Year to the end of such Fiscal
Quarter, setting forth in each case in comparative form the corresponding
figures for the corresponding periods of the previous Fiscal Year and the
corresponding figures from the Projections for the current Fiscal Year, all in
reasonable detail, together with a Financial Officer Certification with respect
thereto;

 

(c)                                  Monthly Reports.  As soon as available, and in any event within
thirty (30) days after the end of each month, the consolidated and
consolidating balance sheet of the Borrower and its Subsidiaries as at the end
of such month and the related consolidated and consolidating 

 

50

 

statements
of income, statements of stockholders’ equity and statements of cash flows of
the Borrower and its Subsidiaries for such month and for the period from the
beginning of the then current Fiscal Year to the end of such month, setting
forth in each case in comparative form the corresponding figures for the
corresponding periods of the previous Fiscal Year and the corresponding figures
from the Projections for the current Fiscal Year, all in reasonable detail,
together with a schedule of reconciliations for any reclassifications with
respect to prior months or periods (and, in connection therewith, copies of any
restated financial statements for any impacted month or period) a Financial
Officer Certification with respect thereto and any other operating reports
prepared by management for such period;

 

(d)                                 Projections.  As soon as available, and in no event later
than thirty (30) days following the beginning of each Fiscal Year, a
consolidated budget and financial forecast for such Fiscal Year and each Fiscal
Year (or portion thereof) through the final maturity date of the Term Loans
(the “Projections”), including (i) a
forecasted consolidated balance sheet and forecasted consolidated statements of
income and cash flows of the Borrower and its Subsidiaries for each such Fiscal
Year, together with an explanation of the assumptions on which such forecasts
are based, (ii) forecasted consolidated statements of income and cash
flows of the Borrower and its Subsidiaries for each month of the following
Fiscal Year and for each quarter of each subsequent Fiscal Year, (iii) forecasts
demonstrating projected compliance with the requirements of Section 6.14
(Financial Covenants) through the Maturity Date, and (iv) forecasts
demonstrating adequate liquidity through the Maturity Date, together, in each
case, with an explanation of the assumptions on which such forecasts are based
all in form and substance reasonably satisfactory to Administrative Agent;

 

(e)                                  Compliance Certificate.  Together with each delivery of financial
statements of the Borrower and its Subsidiaries pursuant to Sections 5.1(a) and
5.1(b), a duly executed and completed Compliance Certificate;

 

(f)                                    Statements of Reconciliation after Change in Accounting
Principles.  If, as a result of any change in accounting
principles and policies from those used in the preparation of the Financial
Statements, the consolidated and consolidating financial statements of the
Borrower and its Subsidiaries delivered pursuant to Section 5.1(a) or
5.1(b) will differ in any material respect from the consolidated and consolidating
financial statements that would have been delivered pursuant to such
subdivisions had no such change in accounting principles and policies been
made, then, together with the first delivery of such financial statements after
such change, one or more statements of reconciliation for all such prior
financial statements in form and substance reasonably satisfactory to
Administrative Agent; and

 

(g)                                 Management Letters.  Copies of any management letters received
from time to time by any Credit Party from its accountants.

 

Section 5.2.                                Visitation; Verification.  Each Credit Party shall keep true and
accurate books of account in accordance with GAAP.  Administrative Agent and, if any Event of
Default has occurred and is continuing, any Lender and/or any of their
designated representatives, shall at all times have full and free access (so
long as no Event Default shall have occurred and be continuing, during normal
business hours and upon reasonable notice) to all the books, correspondence and
records of each Credit Party and Administrative Agent and, if an Event of

 

51

 

Default has occurred and is
continuing, any Lender, and/or any of their designated representatives may
examine the same, take extracts therefrom and make photocopies thereof, and
each Credit Party agrees to render to Administrative Agent, and, if an Event of
Default has occurred and is continuing, any Lender, at such Credit Party’s cost
and expense, such clerical and other assistance as may be reasonably requested
with regard thereto.  Administrative
Agent and, if an Event of Default has occurred and is continuing, any Lender
and/or any of their designated representatives shall at all times also have the
right (so long as no Event Default shall have occurred and be continuing,
during normal business hours and upon reasonable notice) to enter any premises of
each Credit Party and inspect any property of each Credit Party where any of
the Collateral of such Credit Party granted pursuant to the Security
Documentation is located for the purpose of inspecting the same, observing its
use or otherwise protecting their interests therein.  Administrative Agent and, if an Event of
Default has occurred and is continuing, any Lender and/or any of their
designated representatives shall at all times also have the right (so long as
no Event Default shall have occurred and be continuing, during normal business
hours and upon reasonable notice) to discuss the affairs, finances and accounts
of such Persons with, and to be advised as to the same by, the executives and
officers of such Persons.

 

Section 5.3.                                Maintenance of Properties.  Each Credit Party shall maintain its
corporate/legal existence and business, maintain its assets in good operating
conditions and repair (subject to ordinary wear and tear and to all provisions
of this Agreement permitting sales of certain assets of the Credit Parties),
keep its business and assets adequately insured, maintain its chief executive
office in the United States, continue to engage in the same or substantially
similar lines of business, and comply in all material respects with all Regulations,
including, without limitation, ERISA and Environmental Laws, except to the
extent that failure to so act, which either individually or in the aggregate,
could not reasonably expected to have a Material Adverse Effect.

 

Section 5.4.                                Notice of Material Events.  Each Credit Party shall notify Administrative
Agent and the Lenders promptly in writing (i) of the occurrence of any
Default or Event of Default, (ii) of any proceeding alleging noncompliance
with ERISA or any Environmental Law which would reasonably be expected to have
a Material Adverse Effect on such Person, (iii) of any threatened or
pending litigation or other proceeding or claim, to the Knowledge of the Credit
Parties, affecting the Borrower, any of its Subsidiaries or any other Credit
Party involving claims which in the reasonable judgment of such Person could
result in liability in excess of $750,000 in the aggregate or any material
change in any such litigation or proceeding previously reported, (iv) of
any claims to the Knowledge of the Credit Parties, which in the reasonable
judgment of the Borrower could result in liability in excess of $750,000 in the
aggregate against any assets or properties of any Credit Party encumbered in
favor of Administrative Agent and/or the Lenders and (v) any other
development that results in, or could reasonably be expected to result in, a
Material Adverse Effect.

 

Section 5.5.                                Use of Proceeds.  The
Borrower, each of its Subsidiaries and each of the other Credit Parties shall
use the proceeds of the Term Loans only as permitted by Section 2.5
hereof.

 

52

 

Section 5.6.                                Further Assurances.

 

(a)                                  Each Credit Party shall cooperate with Administrative Agent,
take such action, execute such documents, and provide such information as
Administrative Agent may from time to time reasonably request in order to
further effect the transactions contemplated by and the purposes of the Loan
Documents.

 

(b)                                 Each Credit Party shall promptly, upon request by any
Lender, correct, and cause each of the other Credit Parties to any Loan
Document to promptly correct, any defect or error that may be discovered in any
Loan Document or in the execution, acknowledgment or recordation of any Loan
Document.  Promptly upon request by
Administrative Agent or the Required Lenders, the Credit Parties shall execute,
acknowledge, deliver, record, file and register, any and all such further acts,
deeds, conveyances, documents, security agreements, pledge agreements,
mortgages, deeds of trust, trust deeds, assignments, financing statements and
continuations, notices of assignment, transfers, certificates, assurances and
other instruments as Administrative Agent or the Required Lenders may
reasonably require from time to time in order to carry out more effectively the
purposes of each Loan Document.  Without
limiting the foregoing, each Credit Party shall (A) authorize
Administrative Agent to file UCC-1 financing statements in all jurisdictions
deemed necessary or desirable by Administrative Agent, and (B) take such
action from time to time (including, without limitation, filing, executing and
delivering such assignments, security agreement and other instruments) as shall
be reasonably requested by Administrative Agent to create, in favor of the
Lenders, to the extent required under the respective Security Documentation and
to the maximum extent permitted under applicable law, a first-priority
perfected Lien in all of the Collateral (subject to Permitted Liens).

 

Section 5.7.                                [Reserved].

 

Section 5.8.                                Insurance.  Each Credit
Party shall maintain and/or shall cause each of its Subsidiaries to maintain,
at its respective expense, and keep in effect with responsible insurance
companies, such liability insurance for bodily injury and third-party property
damage as is customary in the case of companies engaged in the same or similar
business or having similar properties, similarly situated.  Each Credit Party shall, and shall cause each
of its Subsidiaries to, keep and maintain, at its expense, its material real and
personal property insured against loss or damage by fire, theft, explosion,
spoilage and all other risks ordinarily insured against by other owners or
users of such properties in similar businesses in an amount equal to the full
replacement or cash value thereof, subject to deductible amounts which the
Borrower, in its reasonable judgment, deems prudent.  Each such policy of insurance shall (i) name
Administrative Agent, on behalf of Secured Parties as an additional insured
thereunder as its interests may appear, and (ii) in the case of each
casualty insurance policy, contain a loss payable clause or endorsement,
reasonably satisfactory in form and substance to Administrative Agent, that
names Administrative Agent, on behalf of Secured Parties as the loss payee
thereunder and provides for at least thirty days’ prior written notice to
Administrative Agent of any modification or cancellation of such policy.

 

Section 5.9.                                Information Regarding Collateral.  The Borrower will furnish to Administrative
Agent prompt written notice of any change in (i) any Credit Party’s
corporate name or any trade name used to identify it in the conduct of its
business or any Credit Party’s chief executive office, its principal place of
business or its jurisdiction of organization, or (ii) any Credit Party’s
federal Taxpayer Identification Number. 
The Borrower will not effect or permit 

 

53

 

any change referred to in
the preceding sentence unless all filings have been made under the UCC and all
other actions have been taken that are required so that such change will not at
any time adversely affect the validity, perfection or priority of any Lien
established under any Loan Document on the Collateral.

 

Section 5.10.                         Existence; Conduct of Business.  Each Credit Party will do or cause to be done
all things necessary to preserve, renew and keep in full force and effect its
legal existence and the rights, licenses, permits (including, without
limitation, Environmental Permits) privileges, franchises, patent, copyrights,
trademarks and trade names material to the conduct of its business, except to
the extent that failure to so act, which either individually or in the
aggregate, could not reasonably expected to have a Material Adverse Effect.

 

Section 5.11.                         Payment of Obligations.  Each Credit Party will pay its Indebtedness
and other obligations, including Tax liability, before the same shall become
delinquent or in default, except where (a) the validity or amount thereof
is being contested in good faith by appropriate proceedings, (b) such
Credit Party has set aside on its books adequate reserves with respect thereto
in accordance with GAAP and (c) the failure to make payment pending such
contest could not reasonably be expected to result in a Material Adverse
Effect.

 

Section 5.12.                         Compliance with Laws.   Each Credit Party will comply with all laws
(including, without limitation, all Environmental Laws), rules, licenses,
permits, Regulations and orders of any Governmental Body applicable to it or
its property, except where failure to comply, in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect.

 

Section 5.13.                         Subsidiaries.

 

(a)                                  If any Subsidiary is formed or acquired after the Closing
Date, the Borrower shall, prior to the date upon which such Subsidiary is
formed or acquired, notify Administrative Agent and the Lenders thereof and
immediately following such formation or acquisition and receipt of all required
approvals of the applicable Gaming Authorities, cause any assets owned by, or
Indebtedness owned by or on behalf of any Credit Party to be added to the
Collateral, including without limitation, to the extent permitted by applicable
law, by executing a Stock Pledge Agreement in the form of Exhibit L
hereto.

 

(b)                                 If at any time any Unrestricted Subsidiary, individually or
collectively with the other Unrestricted Subsidiaries, no longer satisfies the
requirements to be an Immaterial Subsidiary, the Borrower shall cause one or
more such Unrestricted Subsidiaries to satisfy the requirements of Section 5.13(a) and
Section 5.14 as if such Unrestricted Subsidiaries were formed or acquired
after the Closing Date.

 

Section 5.14.                         Guarantors.  Subject to
the receipt of all required approvals of applicable Gaming Authorities, the
Borrower shall cause each of its Subsidiaries formed or acquired after the
Closing Date to become a Guarantor hereunder by (i) executing a joinder to
this Agreement in the form of Exhibit D hereto and (ii) executing
a Guaranty in the form of Exhibit C hereto.  Upon delivery of any such joinders and
Guaranty to Administrative Agent, notice of which is hereby waived by the
parties hereto, each such Guarantor shall be as fully a party hereto as if such
Guarantor were an original signatory hereof.  Each Guarantor expressly agrees that its 

 

54

 

obligations arising
hereunder shall not be affected or diminished by the addition or release of any
other Guarantor hereunder, nor by any election of Administrative Agent not to
cause any Subsidiary of the Borrower to become a Guarantor hereunder.

 

Section 5.15.                         Real Property.  In the
event that any Credit Party (i) acquires a real estate asset after the
Closing Date, then such Credit Party, contemporaneously with acquiring such
real estate asset, shall, subject to receipt of all required approvals of
applicable Gaming Authorities, take all such actions and execute and deliver,
or cause to be executed and delivered, all such Mortgages, documents,
instruments, agreements, opinions and certificates similar to those described
in Section 3.1(r) that Administrative Agent shall reasonably request
to create in favor of Administrative Agent, for the benefit of Secured Parties,
a valid and, subject to any filing and/or recording referred to herein,
perfected first priority security interest in such real estate assets (subject
to Permitted Liens); and (ii) leases any Leasehold Property after the
Closing Date with an annual rent in excess of $1,000,000, then such Credit
Party shall use commercially reasonable efforts to deliver to Administrative
Agent a Landlord Access Agreement with respect to such real property.

 

Section 5.16.                         Broker’s Claims.  The
Borrower hereby indemnifies and agrees to hold each Lender and Administrative Agent
harmless from and against any and all losses, liabilities, damages, costs and
expenses which may be suffered or incurred by such Lender or Administrative
Agent, as the case may be, in respect of any claim, suit, action or cause of
action now or hereafter asserted by a broker or any Person acting in a similar
capacity arising from or in connection with the execution and delivery of this
Agreement or any other Loan Document or the consummation of the transactions
contemplated herein or therein, except to the extent resulting from the gross
negligence or willful misconduct of such Lender or Administrative Agent as
determined by a court of competent jurisdiction in a final, non-appealable
order.  This Section 5.16 shall
survive termination of this Agreement.

 

Section 5.17.                         Compliance with ERISA.  Each Credit Party shall:  (i) maintain each Employee Benefit Plan
in compliance in all material respects with the applicable provisions of ERISA,
the Internal Revenue Code and other Federal and State law; (ii) cause each
Employee Benefit Plan which is qualified under Section 401(a) of the
Internal Revenue Code to maintain such qualification; (iii) not, and shall
cause each of its ERISA Affiliates to not, terminate any Pension Plan so as to
incur any material liability to the Pension Benefit Guaranty Corporation; (iv) not
allow or suffer to exist any prohibited transaction involving any Employee
Benefit Plan or any trust created thereunder which would subject such Credit
Party to a material tax or other liability on prohibited transactions imposed
under Section 4975 of the Internal Revenue Code or ERISA; (v) make,
and shall cause each of its ERISA Affiliates to make, all required
contributions to any Pension Plan which it is obligated to pay under Section 302
of ERISA, Section 412 of the Internal Revenue Code or the terms of such
Employee Benefit Plan; (vi) not, and shall cause each of its ERISA
Affiliates to not, allow or suffer to exist any failure to satisfy the minimum
funding standard, whether or not waived, with respect to any Pension Plan; (vii) not,
and shall cause each of its ERISA Affiliates to not, engage in a transaction
that could be subject to Section 4069 or 4212(c) of ERISA; or (viii) not,
and shall cause each of its ERISA Affiliates to not, allow or suffer to exist
any occurrence of a reportable event (within the meaning of Section 4043
of ERISA) or any other event or condition which presents a material risk of
termination by the Pension Benefit Guaranty Corporation of any Pension Plan
that is a 

 

55

 

single employer plan, which
termination could result in any material liability to the Pension Benefit
Guaranty Corporation.

 

Section 5.18.                         Consents of and Notices to Gaming Authorities.

 

(a)                                  The Borrower shall, and shall cause each of its Subsidiaries
to, comply in all material respects with and keep in full force and effect, as
and when required, all Gaming Licenses and all other material Permits obtained
from any Gaming Authority or other Governmental Body that are required for the
operation and use of the MPI Hotel/Casino Facilities, the SDI Facility and the
PIDI Facility.

 

(b)                                 The Borrower shall, and shall cause each of its Subsidiaries
to, make all necessary applications to and procure all necessary consents and
approvals of the applicable Gaming Authorities to the:  (i) restrictions on transfer and pledge
of the stock of MPI, PIDI and SDI contained herein and (ii) the terms set
forth in the Credit Agreement and each of the Loan Documents, to the extent
which may be required by the West Virginia Gaming Authorities, the Pennsylvania
Gaming Authorities and/or the Ohio Gaming Authorities.

 

(c)                                  The Borrower shall, and shall cause each of its Subsidiaries
to, comply in all material respects with all applicable statutes, rules and
regulations requiring reports and disclosures to all applicable Gaming
Authorities, including, but not limited to, reporting this transaction as may
be required by the West Virginia Gaming Authorities, the Pennsylvania Gaming
Authorities and/or the Ohio Gaming Authorities.

 

(d)                                 In the event of a foreclosure, deed in lieu of foreclosure
or other similar transfer of a Gaming Facility or Future Gaming Facility to
Administrative Agent or its designee, the Borrower shall, and shall cause its
Subsidiaries to, reasonably cooperate with Administrative Agent or its designee
in obtaining all Gaming Licenses and other governmental approvals necessary to
conduct all gaming operations at such Gaming Facility or Future Gaming
Facility.  Following a foreclosure, deed
in lieu of foreclosure or other similar transfer of a Gaming Facility or Future
Gaming Facility to Administrative Agent or its designee, subject to receipt of
requisite approvals from any applicable Gaming Authority, the Borrower shall,
and shall cause its Subsidiaries to, reasonably cooperate with the transition
of the gaming operations at such Gaming Facility or Future Gaming Facility to
any new gaming operator (including, without limitation, Administrative Agent or
its designee).

 

ARTICLE VI

Negative Covenants

 

Each Credit Party covenants
and agrees that so long as the Term Loans or any other Obligation shall remain
unpaid or unsatisfied, each Credit Party shall perform, and shall cause each of
its Subsidiaries to perform, all covenants in this Article VI:

 

Section 6.1.                                Indebtedness.  No Credit
Party shall, or shall permit any of its Subsidiaries to, incur, create, assume,
become or be liable in any manner with respect to, or permit to exist, any
Indebtedness, or guarantee, assume, endorse, or otherwise become responsible
for (directly or indirectly), the Indebtedness, performance, obligations or
dividends of any other Person, except:

 

56

 

(a)                                  the Obligations;

 

(b)                                 FF&E Financing; provided, that the aggregate
principal amount of all such Indebtedness (including any Permitted Refinancing
thereof) outstanding at any time shall not exceed $15,000,000;

 

(c)                                  Indebtedness incurred by the Borrower or any Guarantor to
finance the acquisition, development or construction of any Future Gaming
Facility or any Gaming Facility at which gaming operations are not conducted on
the Closing Date, but are conducted following the Closing Date as a result of
the approval of additional gaming activities by the applicable Gaming
Authority; provided that (i) all such Indebtedness shall be
unsecured and subordinated in right of payment to the payment in full of the
Obligations pursuant to the terms of a subordination agreement that is
reasonably satisfactory to Administrative Agent, (ii) no part of the
principal or interest of which is required to be paid (whether by mandatory
sinking fund, mandatory redemption or mandatory prepayment), prior to the date
that is six months after the Maturity Date, (iii) upon the incurrence of
such Indebtedness and after giving pro forma effect thereto, no Default or
Event of Default shall have occurred and be continuing and (iv) upon the
incurrence of such Indebtedness and after giving effect thereto, the Borrower
shall be in pro forma compliance with the financial covenants set forth in Section 6.14
and shall deliver to Administrative Agent a Compliance Certificate at least
five Business Days prior to the date of the incurrence of such Indebtedness
demonstrating the same;

 

(d)                                 Indebtedness of any Guarantor to the Borrower or to any
other Guarantor, or of the Borrower to any Guarantor; provided, (i) all
such Indebtedness shall be unsecured and subordinated in right of payment to
the payment in full of the Obligations pursuant to the terms of the applicable
promissory notes or an intercompany subordination agreement that in any such
case, is reasonably satisfactory to Administrative Agent and (ii) any
payment by any such Guarantor under any guaranty of the Obligations shall
result in a pro tanto reduction of the amount of any Indebtedness owed by such
Subsidiary to the Borrower or to any of its Subsidiaries for whose benefit such
payment is made;

 

(e)                                  the Indebtedness set forth on Schedule 6.1 to this
Agreement; provided, that, (i) the Borrower and Guarantors
may only make regularly scheduled payments of principal and interest in respect
of such Indebtedness in accordance with the terms of the agreement or
instrument evidencing or giving rise to such Indebtedness as in effect on the
date hereof, (ii) the Borrower and Guarantors shall not, directly or
indirectly, (A) amend, modify, alter or change the terms of such
Indebtedness or any agreement, document or instrument related thereto as in
effect on the date hereof in a manner that is adverse to the Lenders except,
that, the Borrower and Guarantors may, after prior written notice to
Administrative Agent, amend, modify, alter or change the terms thereof so as to
extend the maturity thereof, or defer the timing of any payments in respect
thereof, or to forgive or cancel any portion of such Indebtedness (other than
pursuant to payments thereof), or to reduce the interest rate or any fees in
connection therewith, or (B) redeem, retire, defease, purchase or
otherwise acquire such Indebtedness, or set aside or otherwise deposit or
invest any sums for such purpose, and (iii) the Borrower and each
Guarantor shall furnish to Administrative Agent all notices or demands in
connection with such Indebtedness either received by the Borrower or such
Guarantor or on its behalf, promptly after 

 

57

 

the
receipt thereof, or sent by the Borrower or such Guarantor or on its behalf,
concurrently with the sending thereof, as the case may be;

 

(f)                                    Indebtedness which may be deemed to exist pursuant to any
guaranties, performance, surety, statutory, appeal or similar obligations
incurred in the ordinary course of business;

 

(g)                                 so long as the Intercreditor Agreement is in full force and
effect, (i) the Senior Secured Notes in an aggregate principal amount not
to exceed $260,000,000 less any repayments of principal or redemptions
thereof and (ii) additional Senior Secured Notes and (iii) any
Permitted Refinancing thereof, provided that with respect to this clause
(ii), Administrative Agent shall have consented to the incurrence and use of
proceeds of such additional Senior Secured Notes, which consent shall not be
unreasonably withheld or delayed;

 

(h)                                 the Senior Subordinated Notes and any Permitted Refinancing
thereof in an aggregate principal amount not to exceed $125,000,000 less
any repayments of principal or redemptions thereof;

 

(i)                                     if no Event of Default shall have occurred and be
continuing, other unsecured Indebtedness of any Credit Party in an aggregate
amount outstanding at any time not to exceed $5,000,000;

 

(j)                                     Indebtedness in respect of netting services, overdraft
protections and otherwise in connection with deposit accounts;

 

(k)                                  Indebtedness which may be deemed to exist pursuant to any
guaranties, performance, statutory, surety, appeal or similar obligations
incurred in the ordinary course of business;

 

(l)                                     guaranties in the ordinary course of business of the
obligations of suppliers, customers, franchisees and licensees of the Borrower
and its Subsidiaries;

 

(m)                               guaranties by the Borrower of Indebtedness of a Guarantor or
guaranties by a Subsidiary of the Borrower of Indebtedness of the Borrower or a
Guarantor with respect, in each case, to Indebtedness otherwise permitted to be
incurred pursuant to this Section 6.1; and

 

(n)                                 Indebtedness incurred for the purpose of financing insurance
premiums (including, without limitation, extended payment terms) up to an
aggregate amount of $500,000 at any time outstanding.

 

Section 6.2.                                Liens.  No Credit
Party shall create or incur, or cause any of its Subsidiaries to create or
incur, any Liens on any of the property or assets of such Person, except:

 

(a)                                  the security interests and Liens of Administrative Agent for
the benefit of the Secured Parties granted pursuant to the Security Documentation;

 

58

 

(b)                                 so long as the Intercreditor Agreement is in full force and
effect, Liens on the Collateral in favor of the Second Lien Collateral Agent
securing the Senior Secured Notes and any Permitted Refinancing and guarantees
thereof;

 

(c)                                  Liens securing the payment of taxes, assessments or other
governmental charges or levies either not yet overdue or the validity of which
are being contested in good faith by appropriate proceedings diligently pursued
and available to such Credit Party or its Subsidiary, as the case may be and
with respect to which adequate reserves have been set aside on its books;

 

(d)                                 statutory liens of carriers, warehousemen, mechanics,
material men, landlords, repairmen or other like Liens arising by operation of
law in the ordinary course of business provided that (1) the underlying
obligations are not overdue for a period of more than 60 days, or (2) such
Liens are being contested in good faith and by appropriate proceedings and adequate
reserves with respect thereto are maintained on the books of the Borrower or
its Subsidiary in accordance with GAAP;

 

(e)                                  Liens securing the performance of bids, trade contracts
(other than borrowed money), leases, statutory obligations, surety and appeal
bonds, performance bonds and other obligations of a like nature incurred in the
ordinary course of business;

 

(f)                                    zoning restrictions, easements, licenses, covenants and
other restrictions affecting the use of real property which do not interfere in
any material respect with the use of such real property or ordinary conduct of
the business of such Credit Party or its Subsidiary as presently conducted
thereon or materially impair the value of the real property which may be
subject thereto;

 

(g)                                 Liens arising from FF&E Financing permitted to be
incurred pursuant to Section 6.1(b) (and any Permitted Refinancing
thereof); provided that such Liens relate solely to the property which
is subject to such FF&E Financing.

 

(h)                                 pledges and deposits of cash by any Credit Party or its
Subsidiary in the ordinary course of business in connection with workers’
compensation, unemployment insurance and other types of social security or
employee benefits consistent with the current practices of such Credit Party or
its Subsidiary as of the date hereof;

 

(i)                                     pledges and deposits of cash by any Credit Party or its
Subsidiary to secure the performance of tenders, bids, leases, trade contracts
(other than for the repayment of Indebtedness), statutory obligations and other
similar obligations in each case in the ordinary course of business consistent
with the current practices of such Credit Party or its Subsidiary as of the
date hereof;

 

(j)                                     Liens arising from (i) operating leases and the
precautionary UCC financing statement filings in respect thereof and (ii) Equipment
or other materials which are not owned by any Credit Party or its Subsidiary
located on the premises of such Credit Party or its Subsidiary (but not in
connection with, or as part of, the financing thereof) from time to time in the
ordinary course of business and consistent with current practices of such
Credit Party or its Subsidiary and the precautionary UCC financing statement
filings in respect thereof;

 

59

 

(k)                                  judgments and other similar Liens arising in connection with
court proceedings that do not constitute an Event of Default; provided,
that, (i) such Liens are being contested in good faith and by appropriate
proceedings diligently pursued, (ii) adequate reserves or other
appropriate provision, if any, as are required by GAAP have been made therefor,
and (iii) a stay of enforcement of any such Liens is in effect;

 

(l)                                     the security interests and Liens set forth on Schedule
6.2;

 

(m)                               purported Liens evidenced by the filing of precautionary UCC
financing statements relating solely to operating leases of personal property
entered into by the Borrower or any of its Subsidiaries in the ordinary course
of business;

 

(n)                                 leases or subleases granted to other Persons in the ordinary
course of business not materially interfering with the conduct of the business
of the Borrower or any of its Subsidiaries or materially detracting from the
value of the relative assets of the Borrower or any Subsidiary;

 

(o)                                 Liens arising solely by virtue of any statutory or common
law provisions relating to bankers Liens, rights of set-off or similar rights
and remedies as to deposit accounts or other funds maintained with a depositary
institution; provided, that (i) such deposit account is not a
dedicated cash collateral account and is not subject to restrictions against
access by the Borrower in excess of those set forth by regulations promulgated
by the Federal Reserve Board and (ii) such deposit account is not intended
by the Borrower or any Subsidiary to provide collateral to the depositary
institution;

 

(p)                                 any Lien existing on any property or asset prior to the
acquisition thereof by the Borrower or any Subsidiary or existing on any
property or assets of any person that becomes a Subsidiary after the date
hereof prior to the time such person becomes a Subsidiary, as the case may be; provided
that (i) such Lien is not created in contemplation of or in connection
with such acquisition or such person becoming a Subsidiary, (ii) such Lien
does not apply to any other property or assets of the Borrower or any
Subsidiary, and (iii) such Lien secures only those obligations which it
secures on the date of such acquisition or the date such person becomes a
Subsidiary, as the case may be;

 

(q)                                 any encumbrance or restriction (including put and call
arrangements) with respect to Capital Stock of any joint venture or similar
arrangement pursuant to any minority owned joint venture;

 

(r)                                    Liens on any Closing Date Mortgaged Property which are shown
as exceptions on Schedule B of the Title Policies;

 

(s)                                  Liens creating a security interest in the proceeds of the
insurance policy or policies, the premiums of which are financed as permitted
under Section 6.01(n); and

 

(t)                                    other Liens on assets securing Indebtedness in an aggregate
amount not to exceed $1,500,000 at any time outstanding.

 

60

 

Notwithstanding
any in the foregoing to the contrary, no Credit Party shall permit any Lien on,
or grant any security interest in, the Capital Stock of the Guarantors other
than a Lien or security interest in favor of Administrative Agent.

 

Section 6.3.                                Sales and Lease-Backs.  No Credit Party shall, nor shall it permit
any of its Subsidiaries to, directly or indirectly, become or remain liable as
lessee or as a guarantor or other surety with respect to any lease of any
property (whether real, personal or mixed), whether now owned or hereafter
acquired, which such Credit Party (a) has sold or transferred or is to
sell or to transfer to any other Person (other than the Borrower or a
Guarantor), or (b) intends to use for substantially the same purpose as
any other property which has been or is to be sold or transferred by such
Credit Party to any Person (other than the Borrower or a Guarantor) in
connection with such lease; provided,  however, a Credit Party
shall be permitted to enter into a sale-leaseback transaction with respect to
its furniture, fixtures and equipment but (i) such transaction shall be
counted on a dollar-for-dollar basis against the basket set forth in Section 6.1(b) and
(ii) the proceeds received any Credit Party from such transaction shall be
applied pursuant to Section 2.12(a).

 

Section 6.4.                                Transactions with Shareholders and Affiliates.  Without the prior consent of Administrative
Agent, no Credit Party shall, nor shall it permit any of its Subsidiaries to
directly or indirectly:

 

(i)                                     enter into or
permit to exist any transaction (including the purchase, sale, lease or
exchange of any property or the rendering of any service) with any Affiliate of
any Credit Party, except in the ordinary course of business pursuant to the
reasonable requirements of such Credit Party’s business (as the case may be)
and upon fair and reasonable terms no less favorable to such Credit Party than
such Credit Party would obtain in a comparable arm’s length transaction with an
unaffiliated person; and

 

(ii)                                  make any
payments (whether by dividend, loan or otherwise) of management, consulting or
other fees for management or similar services to any Affiliate that is not a
Credit Party or an Unrestricted Subsidiary.

 

Section 6.5.                                Investments.  No Credit
Party shall, nor shall it permit any of its Subsidiaries to, directly or
indirectly, make or own any Investment in any Person, including without
limitation any joint venture, except:

 

(a)                                  Investments in Cash and Cash Equivalents;

 

(b)                                 equity Investments owned as of the Closing Date in any
Subsidiary and Investments made after the Closing Date in any wholly-owned
Guarantor;

 

(c)                                  Investments (i) in any Securities received in
satisfaction or partial satisfaction thereof from financially troubled account
debtors, and (ii) deposits, prepayments and other credits to suppliers
made in the ordinary course of business consistent with the past practices of
the Borrower and its Subsidiaries;

 

(d)                                 intercompany loans to the extent permitted under Section 6.1(d);

 

61

 

(e)                                  Capital Expenditures;

 

(f)                                    Permitted Acquisitions for an aggregate consideration amount
not to exceed $1,000,000 during the term of this Agreement;

 

(g)                                 Investments described on Schedule 6.5;

 

(h)                                 Investments in an amount not to exceed $500,000 at any time
outstanding; and

 

(i)                                     Investments in an amount not to exceed $300,000 in the
aggregate in connection with the closure of Jackson Trotting Association, LLC.

 

Section 6.6.                                [Reserved].

 

Section 6.7.                                Merger; Disposition of Assets; Acquisitions.  No Credit Party shall, nor shall it permit
any of its Subsidiaries to, enter into any transaction of merger or
consolidation, liquidate, wind-up or dissolve itself (or suffer any liquidation
or dissolution), or convey, sell, lease or sub-lease (as lessor or sublessor),
exchange, transfer or otherwise dispose of, in one transaction or a series of
transactions, all or any part of its business, assets or property of any kind
whatsoever, whether real, personal or mixed and whether tangible or intangible,
whether now owned or hereafter acquired, or acquire by purchase or otherwise
(other than purchases or other acquisitions of inventory, materials and
equipment and Capital Expenditures in the ordinary course of business) the
business, property or fixed assets of, or stock or other evidence of beneficial
ownership of, any Person or any division or line of business or other business
unit of any Person, except:

 

(a)                                  any Subsidiary and any Unrestricted Subsidiary of the
Borrower may be merged with or into the Borrower or any Guarantor, or be
liquidated, wound up or dissolved, or all or any part of its business, property
or assets may be conveyed, sold, leased, transferred or otherwise disposed of,
in one transaction or a series of transactions, to the Borrower or any Guarantor;
provided, in the case of such a merger, the Borrower or such Guarantor,
as applicable shall be the continuing or surviving Person;

 

(b)                                 so long as no Default or Event of Default shall have
occurred and be continuing, Asset Sales, the proceeds of which are less than
$750,000 when aggregated with the proceeds of all other Asset Sales made within
the same Fiscal Year; provided (A) the consideration received for
such assets shall be in an amount at least equal to the fair market value
thereof (determined in good faith by the board of directors of the Borrower (or
similar governing body)), (B) no less than 75% thereof shall be paid in
cash, and (C) the Net Asset Sale Proceeds thereof shall be applied as
required by Section 2.11(a);

 

(c)                                  disposals of obsolete or worn out property; and

 

(d)                                 Investments, including, without limitation, Permitted
Acquisitions, made in accordance with Section 6.5.

 

62

 

Section 6.8.                                Fiscal Year; Fiscal Quarter.  No Credit Party
shall change its or any of its Subsidiaries’ Fiscal Year or Fiscal Quarter
without the prior written consent of the Required Lenders.

 

Section 6.9.                                Restricted Payments.  No Credit Party
shall, nor shall it permit any of its Subsidiaries through any manner or means
or through any other Person to, directly or indirectly, declare, order, pay,
make or set apart, or agree to declare, order, pay, make or set apart, any sum
for any Restricted Payment, except:

 

(a)                                  the repurchase of Capital Stock of the Borrower upon the
exercise of stock options representing the exercise price thereof;

 

(b)                                 any dividend, distribution or other payment by any of the
Guarantors or Subsidiaries of any Credit Party on its Capital Stock that is
paid pro rata to all holders of such Capital
Stock;

 

(c)                                  so long as no Default or Event of Default exists,
repurchases, redemptions, or other retirements or acquisitions of Capital Stock
from the Borrower’s employees or directors or managers (or their heirs or
estates) or employees or directors or managers (or their heirs or estates) of
its Subsidiaries upon the death, disability or termination of employment or
pursuant to the terms of any subscription, stockholder or other agreement or
plan in effect on the Closing Date in an aggregate amount pursuant to this
clause (c) to all employees, directors or managers (or their heirs or
estates) not to exceed (i) $250,000 per fiscal year on and after the
Closing Date, or (ii) $1,000,000 in the aggregate pursuant to this clause
(c); and

 

(d)                                 regularly scheduled payments of interest in respect of the
Senior Secured Notes required pursuant to the instruments evidencing such
Senior Secured Notes and the Senior Secured Notes Indenture;

 

(e)                                  regularly scheduled payments of interest in respect of the
Senior Subordinated Notes required pursuant to the instruments evidencing such
Senior Subordinated Notes and the Senior Subordinated Notes Indenture to the
extent such payments are not blocked or prohibited under the terms of such
Senior Subordinated Notes and the Senior Subordinated Notes Indenture;

 

(f)                                    so long as no Default or Event of Default shall have
occurred and be continuing, payments to the holders of the Senior Subordinated
Notes required pursuant to Section 4.20 of the Senior Subordinated Notes
Indenture in an amount not to exceed the amount required thereunder;

 

(g)                                 so long as no Default or Event of Default exists or would
result therefrom, other Restricted Payments in an aggregate amount not to
exceed $1,000,000 since the Closing Date

 

(h)                                 so long as no Default or Event of Default exists or would
result therefrom, regularly scheduled payments in respect of the Indebtedness
permitted pursuant to Section 6.1; and

 

(i)                                     Track Business Contingent Earnout Payments.

 

63

 

The Borrower
shall not, and shall not permit any of its Subsidiaries to, directly or
indirectly, make any Restricted Payment consisting of any Core Gaming Asset.

 

Section 6.10.                         Subsidiaries.  No Credit Party
shall form, or cause to be formed, any other Subsidiary, except in compliance
with Sections 5.13(a) and 5.14.

 

Section 6.11.                         Conduct of Business.  From and after
the Closing Date, no Credit Party shall, nor shall permit any of its
Subsidiaries to, engage in any business other than the business engaged in by
such Credit Party on the Closing Date and similar or related businesses.

 

Section 6.12.                         Restrictions on Subsidiary Distributions.  Except as otherwise permitted herein, no
Credit Party shall, nor shall it permit any of its Subsidiaries to, create or
otherwise cause or suffer to exist or become effective any consensual
encumbrance or restriction of any kind on the ability of any Subsidiary of the
Borrower to (a) pay dividends or make any other distributions on any of
such Subsidiary’s Capital Stock owned by the Borrower or any other Subsidiary
of the Borrower, (b) repay or prepay any Indebtedness owed by such
Subsidiary to the Borrower or any Subsidiary of the Borrower, (c) make
loans or advances to the Borrower or any other Subsidiary of the Borrower, or (d) transfer
any of its property or assets to the Borrower or any other Subsidiary of the
Borrower other than restrictions (i) in agreements evidencing Indebtedness
permitted by Section 6.1(b) that impose restrictions on the property
so acquired, (ii) in the Senior Secured Notes Indenture and the Senior
Subordinated Notes Indenture, (iii) by reason of customary provisions
restricting assignments, subletting or other transfers contained in leases,
licenses, joint venture agreements and similar agreements entered into in the
ordinary course of business, (iv) any Permitted Lien or any document or
instrument governing any Permitted Lien; provided that any such
restriction contained therein relates only to the asset or assets subject to
such Permitted Lien, (v) that are or were created by virtue of any
transfer of, agreement to transfer or option or right with respect to any
property, assets or Capital Stock not otherwise prohibited under this
Agreement, (vi) imposed by applicable law, (vii) contained in the
Loan Documents and (viii) in agreements evidencing Indebtedness permitted
by clauses (c), (e), (f), (i), (k) and (m) of Section 6.1.

 

Section 6.13.                         Amendments to Organizational Documents, Senior Secured Notes Indenture
and Senior Subordinated Notes Indenture.  None of the Credit Parties shall supplement,
modify, amend, restate, extend or otherwise change  the terms of or waive any provision of (a) any
Credit Party’s articles of incorporation, certificate of formation, bylaws,
operating agreement or limited partnership agreement or any similar
organizational document, if such supplement, modification, amendment,
restatement, extension, change or waiver would be materially adverse to
Administrative Agent or the Lenders or (b) the Senior Secured Notes
Indenture or the Senior Subordinated Notes Indenture or any document related
thereto that would:

 

(i)                                     increase the
principal amount of the Senior Secured Indenture or the Senior Subordinated
Indenture in excess of the amount permitted under this Agreement;

 

(ii)                                  increase the
interest rate or yield provisions applicable to the Senior Secured Notes or the
Senior Subordinated Notes;

 

64

 

(iii)                               change any
default or event of default or condition to a default or an event of default
with respect thereto (other than to eliminate any such event of default or
increase any grace period related thereto) or add any event of default or change (to
an earlier date) any date upon which payment of principal, interest or premium
(if any) is due thereon;

 

(iv)                              add or make any
modification that has the effect of adding any financial maintenance covenant
or debt incurrence covenant therein;

 

(v)                                 change the
prepayment provisions thereof in any way that would have the effect of adding
any new mandatory prepayment, or increasing the amount of any existing
mandatory prepayment, or requiring that any existing mandatory prepayment be
made on an earlier date;

 

(vi)                              increase
materially the obligations of the Borrower or any of its Subsidiaries, or
confer any additional material rights upon, the holders of Senior Secured
Notes or the Senior Subordinated Notes (or the trustee, agent or other
authorized representative for such holders) (in each case, including
without limitation, by amending or adding covenants) which would be adverse to
the Borrower or any of its Subsidiaries or Administrative Agent or any Lender;

 

(vii)                           contravene the
provisions of this Agreement or the Intercreditor Agreement;

 

(viii)                        grant or permit
additional Liens on any asset or property to secure any Senior Secured Notes
unless such additional Liens secure the Obligations and are expressly subject
to the Intercreditor Agreement;

 

(ix)                                grant or permit
any Liens on any asset or property to secure the Senior Subordinated Notes; or

 

(x)                                   amend or
otherwise modify the subordination provisions contained in the Senior
Subordinated Notes Indenture or make any amendment or modification which causes
the Obligations to no longer be classified as “Senior Debt” and “Designated
Senior Debt” thereunder.

 

Section 6.14.                         Financial Covenants.

 

(a)                                  Maximum Leverage Ratio.  The Borrower shall not permit the Leverage
Ratio as of any date that is the end of the Fiscal Quarter set forth below to
be more than the ratio set forth opposite such date:

 

	
  Fiscal
  Quarter Ending

  	
   

  	
  Maximum Leverage Ratio

  
	
  June 30, 2010

  	
   

  	
  7.00:1.00

  
	
  September 30, 2010

  	
   

  	
  7.00:1.00

  
	
  December 31, 2010

  	
   

  	
  7.00:1.00

  

 

65

 

	
  March 31, 2011

  	
   

  	
  7.00:1.00

  
	
  June 30, 2011

  	
   

  	
  6.50:1.00

  
	
  September 30, 2011

  	
   

  	
  6.00:1.00

  
	
  December 31, 2011

  	
   

  	
  6.00:1.00

  
	
  March 31, 2012

  	
   

  	
  6.00:1.00

  
	
  June 30, 2012

  	
   

  	
  6.00:1.00

  
	
  September 30, 2012

  	
   

  	
  4.50:1.00

  
	
  December 31, 2012

  	
   

  	
  4.50:1.00

  

 

(b)                                 Interest Coverage Ratio.  The Borrower shall not permit the Interest
Coverage Ratio for the four Fiscal Quarter period ending on each Fiscal Quarter
set forth below to be less than the amount or ratio set forth opposite such
Fiscal Quarter period:

 

	
  Four
  Fiscal Quarter

  Ending

  	
   

  	
  Interest Coverage Ratio

  
	
  June 30, 2010

  	
   

  	
  1.10:1.00

  
	
  September 30, 2010

  	
   

  	
  1.10:1.00

  
	
  December 31, 2010

  	
   

  	
  1.10:1.00

  
	
  March 31, 2011

  	
   

  	
  1.15:1.00

  
	
  June 30, 2011

  	
   

  	
  1.15:1.00

  
	
  September 30, 2011

  	
   

  	
  1.30:1.00

  
	
  December 31, 2011

  	
   

  	
  1.30:1.00

  
	
  March 31, 2012

  	
   

  	
  1.30:1.00

  
	
  June 30, 2012

  	
   

  	
  1.30:1.00

  
	
  September 30, 2012

  	
   

  	
  1.30:1.00

  
	
  December 31, 2012

  	
   

  	
  1.50:1.00

  

 

(c)                                  Minimum Consolidated EBITDA.  The Borrower shall not permit Consolidated
EBITDA for the four Fiscal Quarter period ending on each Fiscal Quarter set
forth below to be less than the amount or ratio set forth opposite such Fiscal
Quarter period:

 

66

 

	
  Four
  Fiscal Quarter

  Ending

  	
   

  	
  Consolidated EBITDA

  	
   

  
	
  June 30, 2010

  	
   

  	
  $

  	
  54,000,000

  	
   

  
	
  September 30, 2010

  	
   

  	
  $

  	
  54,000,000

  	
   

  
	
  December 31, 2010

  	
   

  	
  $

  	
  54,000,000

  	
   

  
	
  March 31, 2011

  	
   

  	
  $

  	
  55,000,000

  	
   

  
	
  June 30, 2011

  	
   

  	
  $

  	
  60,000,000

  	
   

  
	
  September 30, 2011

  	
   

  	
  $

  	
  60,000,000

  	
   

  
	
  December 31, 2011 and
  at all times thereafter

  	
   

  	
  $

  	
  65,000,000

  	
   

  

 

(d)                                 Maximum Capital
Expenditures.  The
Borrower shall not, and shall not permit its Subsidiaries to, make or incur
Capital Expenditures during each Fiscal Year indicated below in excess of the
amount set forth opposite such Fiscal Year, evidence of which shall be
delivered to Administrative Agent with the applicable Financial Statements and
certifications required under Section 5.1:

 

	
  Fiscal
  Year

  	
   

  	
  Maximum Capital

  Expenditures

  	
   

  
	
  2010

  	
   

  	
  $

  	
  32,000,000

  	
   

  
	
  2011

  	
   

  	
  $

  	
  23,000,000

  	
   

  
	
  2012

  	
   

  	
  $

  	
  23,000,000

  	
   

  
	
  2013

  	
   

  	
  $

  	
  5,600,000

  	
   

  

 

;
provided, however, that to the extent that actual Capital
Expenditures incurred in any such Fiscal Year shall be less than the maximum
amount set forth above for such Fiscal Year (without giving effect to the
carryover permitted by this proviso), 50% of the difference between stated
maximum amount set forth above and such actual Capital Expenditures shall, in
addition to any amount permitted above, be available for Capital Expenditures
in the next succeeding Fiscal Year; provided, further, that (i) any
Capital Expenditures incurred in the next succeeding Fiscal Year shall be
applied first, to the amounts permitted pursuant to this Section 6.14(d) without
giving effect to the preceding proviso and second, to the carryover
amount from the previous Fiscal Year; and (ii) any carryover amount not
used in the next succeeding Fiscal Year shall not be available in the following
Fiscal Years.

 

(e)                                  Certain Calculations.
 With respect to any period during which
an Investment, an Asset Sale or a Permitted Acquisition has occurred, for
purposes of determining compliance with the financial covenants set forth in
this Section 6.14, Consolidated EBITDA shall be calculated with respect to
such period on a pro forma basis (including pro forma adjustments arising out
of events which are directly attributable to a specific transaction, are
factually supportable and are expected to have a continuing impact, in each
case determined on a basis consistent with Article 11 of Regulation S-X
promulgated under the Securities Act and as interpreted by the staff of the
Securities and Exchange Commission, which would include cost savings resulting
from head 

 

67

 

count
reduction, closure of facilities and similar restructuring charges, which pro
forma adjustments shall be certified by the chief financial officer of the
Borrower) using the historical audited financial statements of any business so
acquired or to be acquired or sold or to be sold and the consolidated financial
statements of the Borrower and its Subsidiaries which shall be reformulated as
if such Investment, Asset Sale or Permitted Acquisition and any Indebtedness
incurred or repaid in connection therewith, had been consummated or incurred or
repaid at the beginning of such period (and assuming that such Indebtedness
bears interest during any portion of the applicable measurement period prior to
the relevant acquisition at the weighted average of the interest rates
applicable to the outstanding Term Loans incurred during such period).

 

ARTICLE VII

Increased Costs; Taxes; Indemnification; Set Off; Etc.

 

Section 7.1.                                Increased Costs; Capital Adequacy.  In the event that any Lender shall have
determined that the adoption, effectiveness, phase in or applicability after
the Closing Date of any Regulation (or any provision thereof) regarding capital
adequacy applicable to such Lender, or any change therein or in the
interpretation or administration thereof by any Governmental Body, central bank
or comparable agency charged with the interpretation or administration thereof,
or compliance by any Lender (or its applicable lending office) with any
guideline, request or directive regarding capital adequacy (whether or not
having the force of law) of any such Governmental Body, central bank or
comparable agency applicable to such Lender, has or would have the effect of
reducing the rate of return on the capital of such Lender or any company
controlling such Lender as a consequence of, or with reference to, such Lender’s
obligations hereunder with respect to the Term Loans to a level below that
which such Lender or such controlling corporation could have achieved but for
such adoption, effectiveness, phase in, applicability, change or compliance
(taking into consideration the policies of such Lender or such controlling
corporation with regard to capital adequacy), then from time to time, after the
adoption, effectiveness or applicability of such Regulation, within ten
Business Days after receipt by the Borrower from such Lender of the statement
referred to in the next sentence, the Borrower shall pay to such Lender such
additional amount or amounts as will compensate such Lender or such controlling
company on an after tax basis for such reduction.  Such Lender shall deliver to the Borrower
(with a copy to Administrative Agent) a written statement, setting forth in
reasonable detail the basis for calculating the additional amounts owed to
Lender under this Section 7.1, which statement shall be conclusive and
binding upon all parties hereto absent manifest error.

 

Section 7.2.                                Taxes; Withholding, etc.

 

(a)                                  Payments to Be Free and Clear.  All sums payable by any Credit Party
hereunder and under the other Loan Documents shall (except to the extent
required by law) be paid free and clear of, and without any deduction or
withholding on account of, any Tax (other than a Tax on the overall net income
of Administrative Agent or any Lender) imposed, levied, collected, withheld or
assessed by or within the United States of America or any political subdivision
in or of the United States of America or any other jurisdiction from or to
which a payment is made by or on behalf of any Credit Party or by any
federation or organization of which the United States of America or any such
jurisdiction is a member at the time of payment; provided, however,
that the Borrower shall be under no obligation to increase the sum payable to
any Lender not 

 

68

 

organized
under the laws of the United States or a state thereof (a “Foreign Lender”) by an amount equal to the
amount of the United States Tax required to be withheld under United States law
from the sums paid to such Foreign Lender, if such withholding is caused by the
failure of such Foreign Lender to be engaged in the active conduct of a trade
or business in the United States, or all amounts of interest and fees to be
paid to such Foreign Lender hereunder are not effectively connected with such
trade or business within the meaning of U.S. Treasury Regulation 1.1441-1(a) or
such Foreign Lender fails to comply with Section 7.2(c) and Borrower
shall be under no obligation to increase the sum payable to any Lender that is
not a Foreign Lender if such Lender fails to comply with Section 7.2(d).

 

(b)                                 Withholding of Taxes.  If any Credit Party is required by law to
make any deduction or withholding on account of any Tax (other than a Tax on
the overall income of Administrative Agent and Lender or a Tax referred to in
the proviso to Section 7.2(a)) from any sum paid or payable by any Credit
Party to Administrative Agent or any Lender on account of a transaction under
any of the Loan Documents, but not any Tax imposed on Administrative Agent or
any Lender in the ordinary or general conduct of business, which Administrative
Agent or Lender would have been subject to without regard to whether it had
engaged in any transaction under any of the Loan Documents: (i) the
Borrower shall notify Administrative Agent of any such requirement or any
change in any such requirement as soon as the Borrower becomes aware of it, (ii) the
Borrower shall pay any such Tax before the date on which penalties attach
thereto, such payment to be made (if the liability to pay is imposed on any
Credit Party) for its own account or (if that liability is imposed on
Administrative Agent or such Lender, as the case may be) on behalf of and in
the name of Administrative Agent or such Lender, (iii) the sum payable by
such Credit Party in respect of which the relevant deduction, withholding or
payment is required shall be increased to the extent necessary to ensure that,
after the making of that deduction, withholding or payment, Administrative
Agent or such Lender, as the case may be, receives on the due date a net sum
equal to what it would have received had no such deduction, withholding or
payment been required or made, and (iv) within 30 days after paying any
sum from which it is required by law to make any deduction or withholding, and
within 30 days after the due date of payment of any Tax which it is required by
clause (ii) above to pay, the Borrower shall deliver to Administrative
Agent evidence satisfactory to the other affected parties of such deduction,
withholding or payment and of the remittance thereof to the relevant taxing or
other authority.

 

(c)                                  Foreign Lenders.  Each Foreign Lender agrees that it will
deliver to the Borrower and Administrative Agent (i) two (2) duly
completed copies of United States Internal Revenue Service Form W-8BEN or
W-8ECI or other applicable United States Internal Revenue Service forms, or
successor applicable form(s), as the case may be, together with any other
certificate or statement of exemption required under the Internal Revenue Code
or regulations issued thereunder.  Each
such Foreign Lender also agrees to deliver to the Borrower and Administrative
Agent two (2) further copies of said Form W-8BEN or W-8ECI or other
applicable United States Internal Revenue Service forms, or successor applicable
form(s) or other manner of certification, as the case may be, on or before
the date that any such form expires or becomes obsolete or after the occurrence
of any event requiring a change in the most recent form previously delivered by
it to the Borrower and Administrative Agent, and such extensions or renewals
thereof as may reasonably be requested by the Borrower or Administrative Agent,
unless in any such case an event (including, without limitation, any change in
treaty, law or regulation) has occurred prior 

 

69

 

to
the date on which any such delivery would otherwise be required which renders
all such forms inapplicable or which would prevent such Foreign Lender from
duly completing and delivering any such form with respect to it and such
Foreign Lender so advises the Borrower and Administrative Agent.  Such Foreign Lender shall certify in the case
of a Form W-8BEN or W-8ECI or other applicable United States Internal
Revenue Service forms that it is entitled to receive payments under this
Agreement without deduction or withholding of any United States federal income
taxes and that it is entitled to an exemption from United State backup
withholding tax.

 

(d)                                 Domestic Lenders.  Each Lender that is not a Foreign Lender
agrees that it will deliver to the Borrower and Administrative Agent two (2) duly
completed copies of United States Internal Revenue Service Form W-9 or
successor form(s), as the case may be, together with any other certificate or
statement of exemption required under the Internal Revenue Code or regulations
issued thereunder, certifying that such Lender is entitled to an exemption from
United States backup withholding tax with respect to payments under this
Agreement.

 

(e)                                  Treatment of Certain Refunds.  If Administrative Agent, or a Lender
determines, in its sole discretion, that it has received a refund of any Taxes
with respect to which the Borrower has paid increased amounts pursuant to Section 7.2(b),
it shall pay to the Borrower an amount equal to such refund (but only to the
extent of the increased amounts paid by the Borrower giving rise to such
refund), net of all out-of-pocket expenses of Administrative Agent or such
Lender and without interest (other than any interest paid by the relevant
Governmental Body with respect to such refund), provided that the
Borrower, upon the request of Administrative Agent or such Lender agrees to
repay the amount paid over to the Borrower (plus any penalties, interest or
other charges imposed by the relevant Governmental Body) to the Administrative
Agent or such Lender in the event Administrative Agent or such Lender is
required to repay such refund to such Governmental Authority.  This paragraph shall not be construed to
require Administrative Agent or any Lender to make available its tax returns
(or any other information relating to its taxes that it deems confidential) to
the Borrower or any other Person.

 

(f)                                    Indemnification by the Borrower.  The Borrower shall
indemnify Administrative Agent and each Lender for any Tax referred to in Section 7.2(a) (other
than a Tax on the overall income of Administrative Agent and Lender or a Tax
referred to in the proviso to Section 7.2(a)) paid by Administrative Agent
or such  Lender and any penalties,
interest and reasonable expenses arising therefrom or with respect thereto.

 

Section 7.3.                                Indemnification.

 

(a)                                  Indemnification by the Credit Parties.  The Credit Parties
will indemnify and defend Administrative Agent, the Lenders and each of their
respective shareholders, partners, members, managers, directors, officers,
employees, agents, attorneys and Affiliates (collectively, the “Indemnified Persons”) against and hold each
Indemnified Person harmless from any and all liabilities, obligations, losses,
damages, costs, expenses, claims, penalties, Actions, judgments, disbursements
of any kind or nature whatsoever, interest, fines, cleanup costs, settlements,
costs of preparation and investigation, costs incurred in enforcing this
indemnity and reasonable and reasonably documented attorneys’ fees and expenses
(collectively, “Losses”), 

 

70

 

that
any of the Indemnified Persons may incur, suffer, sustain or become subject to
arising out of, relating to, or due to (i) this Agreement or any other
Loan Documents or the transactions contemplated hereby or thereby,  (ii) any material inaccuracy or breach
of any of the representations and warranties of any Credit Party contained in
any Credit  Document or in any
certificate delivered thereunder, (iii) the non-fulfillment or breach of
any covenant, undertaking, agreement or other obligation of any Credit Party
contained in any Loan Document or in any certificate delivered thereunder, (iv) any
Environmental Liability, and/or (v) any use of proceeds of any Term Loan; provided
that such indemnity shall not, as to any Indemnified Person, be available to
the extent such Losses arise out of the gross negligence or willful misconduct,
as determined by a court of competent jurisdiction in a final, non-appealable
order, of such Indemnified Person.  Upon
request of an Indemnified Person, the Borrower shall retain counsel reasonably
satisfactory to the Indemnified Person to represent the Indemnified Person(s) in
connection with any Losses or threatened Losses and shall pay the reasonable
and reasonably documented fees and disbursements of such counsel.  Each Indemnified Person shall have the right
to employ its own counsel at the expense of the Borrower if (i) the
employment of counsel by the Indemnified Person at the expense of the Borrower
has been authorized in writing by the Borrower, (ii) the Borrower has not
employed counsel to represent the Indemnified Person within a reasonable time
after receiving notice of a request for the retention of counsel or (iii) both
the Indemnified Person and the Borrower are implicated with respect to the
Losses or the threatened Losses, and representation of both parties by the same
counsel would be inappropriate due to actual or potential conflicts in
representing both parties between them, in each of which cases the reasonable
and reasonably documented fees and expenses of counsel (including local
counsel) will be at the expense of the Borrower, and all such fees and expenses
will be reimbursed promptly as they are incurred.  Notwithstanding anything to the contrary set
forth herein, Section 7.3 shall not apply to Taxes which are covered
solely by Section 7.2(f).

 

(b)                                 Contribution.  If the indemnification provided for in Section 7.3(a) is
prohibited under applicable Regulations to an Indemnified Person, then the
Borrower, in lieu of indemnifying the Indemnified Person, will contribute to
the amount paid or payable by the Indemnified Person as a result of the Losses
in such proportion as is appropriate to reflect the relative fault of the
Borrower, on the one hand, and of the Indemnified Person, on the other, in
connection with the events or circumstances which resulted in the Losses as
well as any other relevant equitable considerations.

 

Section 7.4.                                Right of Set Off.  In
addition to any rights now or hereafter granted under applicable law and not by
way of limitation of any such rights, upon the occurrence and during the
continuation of any Event of Default, each Lender and Administrative Agent are
hereby authorized by each Credit Party at any time or from time to time,
without notice to any Credit Party or to any other Person, any such notice
being hereby expressly waived, to set off and to appropriate and to apply any
and all deposits (general or special, including Indebtedness evidenced by
certificates of deposit, whether matured or unmatured, but not including trust
accounts) and any other Indebtedness at any time held or owing by such Lender
or Administrative Agent to or for the credit or the account of any Credit Party
against and on account of the Obligations of any Credit Party to such Lender or
Administrative Agent hereunder, irrespective of whether or not (a) such
Lender or Administrative Agent shall have made any demand hereunder or (b) the
principal of or the interest on the Term Loans or any

 

71

 

other amounts due hereunder
or the other Loan Documents shall have become due and payable and although such
obligations and liabilities, or any of them, may be contingent or unmatured.

 

Section 7.5.                                Funding Breakage.  In
addition to the compensation required under Section 7.1, the Borrower
shall pay all administrative fees charged by Lender and indemnify each Lender
against any loss or expense (including loss of margin) which such Lender has
incurred as a consequence of any payment or prepayment of any Term Loan on a
day other than the last day of the corresponding Interest Period (whether or
not such payment is mandatory or automatic and whether or not such payment or
prepayment is then due).  If any Lender
sustains or incurs any such loss or expense or if any Lender has charged the
Borrower for an administrative expense it shall from time to time promptly
notify the Borrower and Administrative Agent in writing setting forth in
reasonable detail the amount determined in good faith by such Lender (such determination
shall be conclusive absent manifest error) to be necessary to indemnify such
Lender for such loss or expense and the amount of such administrative
expense.  Such amount shall be due and
payable by the Borrower to Administrative Agent for the account of such Lender,
five Business Days after such notice is given.

 

Section 7.6.                                Booking of LIBOR Loans.  Any Lender may make, carry or transfer LIBOR
Loans at, to or for the account of any of its branch offices or the office of
an Affiliate of such Lender.

 

Section 7.7.                                Inability to Determine LIBOR.  In the event that Administrative Agent shall
have determined (which determination shall be final and conclusive and binding
upon all parties hereto), on any Interest Rate Determination Date with respect
to LIBOR Loans, that by reason of circumstances affecting the London interbank
market adequate and fair means do not exist for ascertaining the interest rate
applicable to the Term Loans on the basis provided for in the definition of
LIBOR, Administrative Agent shall on such date give notice in writing to the
Borrower and each Lender of such determination, whereupon (i) no Term
Loans may be made as, or converted to LIBOR Loans until such time as
Administrative Agent notifies the Borrower and the Lenders that the circumstances
giving rise to such notice no longer exist, and (ii) any Borrowing
Certificate of Notice of Conversion/Continuation given by the Borrower with
respect to the Term Loans in respect of which such determination was made shall
be deemed to be rescinded by the Borrower.

 

Section 7.8.                                Assignment of Loans Under Certain Circumstances; Duty to Mitigate.

 

(a)                                  In the event (i) any Lender delivers a written
statement requesting compensation pursuant to Section 7.1, (ii) the
Borrower is required to pay any additional amount to any Lender or any
Governmental Body on account of any Lender pursuant to Section 7.2 or (iii) any
Lender refuses to consent to any amendment, waiver or other modification of any
Loan Document requested by the Borrower that requires the consent of each
Lender and such amendment, waiver or other modification is consented to by
Administrative Agent and Required Lenders, the Borrower, at its sole expense
and effort, upon notice to such Lender and Administrative Agent, may require
such Lender (other than any Lender affiliated with the Administrative Agent) to
transfer and assign (in accordance with and subject to the restrictions
contained in Section 10.4) all of its Term Loans and Term Loan Commitments
under this Agreement to an Eligible 

 

72

 

Assignee
that shall assume such assigned Term Loans and Term Loan Commitments (which
Eligible Assignee may be another Lender, if a Lender accepts such assignment); provided  that (x) such assignment shall not conflict with any
law, rule or regulation or order of any court or other Governmental Body
having jurisdiction, (y) in the event of any assignment required of a
non-consenting Lender pursuant to clause (iii) above, such Eligible
Assignee shall consent, at the time of such assignment, to each matter in
respect of which such assigning Lender was a non-consenting Lender and (z) the
Borrower or such Eligible Assignee shall have paid to the affected Lender in
immediately available funds an amount equal to the sum of the principal of and
interest accrued to the date of such payment on the outstanding Loans of such
Lender, plus all fees and other amounts accrued for the account of such Lender
hereunder with respect thereto (including, without limitation, any amounts
under Section 2.11(g) (treating such assignment as a voluntary
prepayment under Section 2.10), Section 7.1 and Section 7.2); provided
further that, if prior to any such transfer and assignment the
circumstances or event that resulted in such Lender’s claim for compensation
under Section 7.1 or the amounts paid pursuant to Section 7.2, as the
case may be, cease to cause such Lender to suffer increased costs or reductions
in amounts received or receivable or reduction in return on capital or cease to
result in amounts being payable under Section 7.2, as the case may be, or
if such Lender shall waive its right to claim further compensation under Section 7.1
in respect of such circumstances or event or shall waive its right to further
payments under Section 7.2 in respect of such circumstances or event or
shall consent to the proposed amendment, waiver, consent or other modification,
as the case may be, then such Lender shall not thereafter be required to make
any such transfer and assignment hereunder. Each Lender hereby grants to the
Borrower an irrevocable power of attorney (which power is coupled with an
interest) to execute and deliver, on behalf of such Lender as assignor, any
Assignment Agreement necessary to effectuate any assignment of such Lender’s
interests hereunder in the circumstances contemplated by this Section 7.8(a).

 

(b)                                 If (i) any Lender shall request compensation under Section 7.1
or (ii) the Borrower is required to pay any additional amount to any
Lender or any Governmental Body on account of any Lender pursuant to Section 7.2,
then such Lender shall use reasonable efforts (which shall not require such
Lender to incur an unreimbursed loss or unreimbursed cost or expense or
otherwise take any action inconsistent with its internal policies or legal or
regulatory restrictions or suffer any disadvantage or burden deemed by it to be
significant) (x) to file any certificate or document reasonably requested
in writing by the Borrower or (y) to assign its rights and delegate and
transfer its obligations hereunder to another of its offices, branches or
affiliates, if such filing or assignment would reduce its claims for
compensation under Section 7.1 or would reduce amounts payable pursuant to
Section 7.2, as the case may be, in the future.  The Borrower hereby agrees to pay all
reasonable costs and expenses incurred by any Lender in connection with any
such filing or assignment, delegation and transfer.

 

ARTICLE VIII

Events of Default

 

Section 8.1.                                Events of Default.  Any
one or more of the following events which shall occur and be continuing shall
constitute an “Event of Default”:

 

(a)                                  Failure to Make Payments When Due.  The Borrower fails
to pay any of the Obligations, including failure by the Borrower to pay when
due any payment of principal of, or 

 

73

 

interest
on, the Term Loans, whether at stated maturity, by acceleration, by notice of
voluntary prepayment, by mandatory prepayment or otherwise, or any fee or any
other amount due hereunder, and solely with respect to interest, such failure
to pay is continuing for three (3) days after the due date therefor.

 

(b)                                 Breach of Certain Covenants.  Failure of any Credit Party to perform or
comply with any term or condition contained in Section 2.5, Sections 5.1,
5.4, 5.5, 5.10, 5.12 or Sections 6.1, 6.2, 6.3, 6.4, 6.5, 6.7, 6.9, 6.11 and
6.14.

 

(c)                                  Breach of Representations, Etc.  Any representation,
warranty, certification or other statement made or deemed made by any Credit
Party in any Loan Document or in any statement or certificate at any time given
by any Credit Party or any of its Subsidiaries in writing, pursuant hereto or
thereto or in connection herewith or therewith shall be false in any material
respect as of the date made or deemed made.

 

(d)                                 Other Defaults Under Loan Documents.  Any Credit Party
shall default in the performance of or compliance with any term contained in
any of the other Loan Documents, other than any such term referred to in any
other Subsection of this Section 8.1, and such default shall not have been
remedied or waived within thirty (30) days after the earlier of (i) an
officer of such Credit Party becoming aware of such default, or (ii) receipt
by the Borrower of written notice from Administrative Agent or any Lender of such
default.

 

(e)                                  Default in Other Agreements.  (i)  Failure of any Credit Party to pay
when due any principal of or interest on or any other amount payable in respect
of one or more items of Indebtedness in an aggregate principal amount of
$2,500,000 or more, in each case beyond the grace period, if any, provided
therefor, or (ii) breach or default by any Credit Party with respect to
any other material term of (A) one or more items of Indebtedness in the
individual or aggregate principal amounts referred to in clause (i) above
or (B) any loan agreement, mortgage, indenture or other agreement relating
to such item of Indebtedness, in each case beyond the grace period, if any,
provided therefor, if the effect of such breach or default is to cause, or to
permit the holder or holders of such Indebtedness (or a trustee on behalf of
such holder or holders) to cause, such Indebtedness to become or be declared
due and payable (or redeemable) prior to its stated maturity or the stated
maturity of any underlying obligation, as the case may be, in either case as a
result of such breach or default.

 

(f)                                    Involuntary Bankruptcy, Appointment of Receiver, etc.  (i) A court of
competent jurisdiction shall enter a decree or order for relief in respect of
any Credit Party in an involuntary case under the Bankruptcy Code or under any
other applicable bankruptcy, insolvency or similar law now or hereafter in
effect, which decree or order is not stayed within 60 days, or any other
similar relief shall be granted under any applicable federal or state law, or (ii) an
involuntary case shall be commenced against any Credit Party under the
Bankruptcy Code or under any other applicable bankruptcy, insolvency or similar
law now or hereafter in effect, or a decree or order of a court having jurisdiction
in the premises for the appointment of a receiver, interim receiver,
receiver-manager, liquidator, sequestrator, trustee, custodian or other officer
having similar powers over any Credit Party, or over all or a substantial part
of such Credit Party’s property, shall have been entered; or there shall have
occurred the involuntary appointment of an interim receiver, trustee or other
custodian of any Credit Party for all or a substantial part of its property 

 

74

 

or
a warrant of attachment, execution or similar process shall have been issued
against any substantial part of the property of any Credit Party, and any such
event described in this clause (ii) shall continue for 60 days without
having been dismissed, bonded or discharged.

 

(g)                                 Voluntary Bankruptcy, Appointment of Receiver, Etc.  (i) Any Credit
Party shall have an order for relief entered with respect to it or shall
commence a voluntary case under the Bankruptcy Code or under any other applicable
bankruptcy, insolvency or similar law now or hereafter in effect, or shall
consent to the entry of an order for relief in an involuntary case, or to the
conversion of an involuntary case to a voluntary case, under any such law, or
shall consent to the appointment of or taking possession by a receiver, interim
receiver, receiver-manager, trustee or other custodian for all or a substantial
part of its property; or any Credit Party shall make any assignment for the
benefit of creditors, or (ii) any Credit Party shall be unable, or shall
fail generally, or shall admit in writing its inability, to pay its debts as
such debts become due; or the board of directors (or similar governing body) of
any Credit Party (or any committee thereof) shall adopt any resolution or
otherwise authorize any action to approve any of the actions referred to herein
or in Section 8.1(f).

 

(h)                                 Judgments and Attachments.  Any money judgment, writ or warrant of
attachment or similar process involving in an aggregate at any time an amount
in excess of $2,000,000 (to the extent not adequately covered by insurance as
to which a solvent and unaffiliated insurance company has acknowledged
coverage) shall be entered or filed against any Credit Party or any of their
respective assets and shall remain undischarged, unvacated, unbonded or
unstayed for a period of 45 days (or in any event later than 5 days prior to
the date of any proposed sale thereunder).

 

(i)                                     Dissolution.  Any order, judgment or decree shall be
entered against any Credit Party decreeing the dissolution or split up of any
Credit Party and such order shall remain undischarged or unstayed for a period
in excess of fifteen (15) days, or any Credit Party shall otherwise dissolve or
cease to exist (except as permitted by Section 6.7).

 

(j)                                     Change of Control.  A Change of Control shall occur.

 

(k)                                  Material Adverse Effect.  A Material Adverse Effect shall occur.

 

(l)                                     Termination by PGBC.  The PGCB orders the termination of this
Agreement or any related Loan Document pursuant to 58 Pa. Code § 441a.13.

 

(m)                               Security Documentation and other Loan Documents.  At any time after
the execution and delivery thereof, (i) (x) this Agreement or any
Loan Document ceases to be in full force and effect (other than by reason of a
release of Collateral in accordance with the terms hereof or thereof or the
satisfaction in full of the Obligations in accordance with the terms hereof) or
shall be declared null and void, or (y) Administrative Agent shall not
have or shall cease to have a valid and perfected first priority Lien in any
Collateral purported to be covered by the Security Documentation (except (1) as
expressly permitted by the Loan Documents or (2) as a result of the
actions or failures to act of Administrative Agent or any Lender), or (ii) any
Credit Party shall contest the validity or enforceability of any Loan Document
in writing or deny in writing that it has any further liability under any Loan
Document to which it is a party.

 

75

 

(n)                                 Gaming Licenses.  The suspension or loss (excluding any
voluntary termination of such rights in connection with a sale, lease or
closure of a site (other than the MPI Hotel/Casino Facilities and the PIDI
Hotel/Casino Facilities), provided that such sale, lease or closure was
otherwise permitted by, and complied with the provisions of, the Indenture) of
the Borrower’s or any of the Borrower’s Subsidiaries’ legal right to operate
slot machines or to conduct other gaming operations (other than parimutuel
wagering) at the Hotel/Casino Facilities and such suspension or loss continues
for more than 90 consecutive days or for 120 days within any consecutive
180-day period.

 

Section 8.2.                                Remedies.  Upon and
after the occurrence of an Event of Default:

 

(a)                                  Non-Bankruptcy Related Defaults/Termination.  In the case of any
Event of Default specified in any Section other than Section 8.1(f),
8.1(g) or 8.1(l), Administrative Agent may, and at the request of the
Required Lenders shall, by notice to the Borrower from time to time declare the
unpaid principal amount of the Term Loans, interest accrued thereon and all
other Obligations to be immediately due and payable, which shall become
immediately due and payable without presentment, demand, protest or other
notice of any kind, all of which are hereby waived by the Borrower.

 

(b)                                 Bankruptcy Events of Default/Termination.  In the case of
either of the Events of Default specified in Section 8.1(f), 8.1(g) or
8.1(l), automatically, without any notice to the Borrower or any other act by
Administrative Agent or any Lender, each of the following shall immediately
become due and payable without presentment, demand, protest or other notice of
any kind, all of which are hereby waived by the Borrower:  (i) the unpaid principal amount of and
interest on the Term Loans and (ii) all other Obligations.

 

(c)                                  Remedies in All Events of Default.  Administrative
Agent shall, at the request of or with the consent of the Required Lenders, (i) exercise
all rights and remedies provided in the Loan Documents, (ii) exercise any
right of counterclaim, setoff, banker’s lien or otherwise which it may have
with respect to money or property of the Borrower, (iii) bring any
lawsuit, action or other proceeding permitted by law for the specific
performance of, or injunction against any violation of, any Loan Document and
may exercise any power granted under or to recover judgment under any Loan
Document, (iv) enforce any and all Liens and security interests created
pursuant to Loan Documents, and (v) exercise any other right or remedy
permitted by applicable Regulations.

 

(d)                                 Lenders’ Remedies.  Unless otherwise directed by the Required
Lenders, in case any one or more of the Events of Default shall have occurred
and be continuing, and whether or not the Lenders shall have accelerated the
maturity of the Term Loans pursuant to Section 8.2, the Required Lenders,
if owed any amount with respect to the Term Loans, may proceed to protect and
enforce their rights by suit in equity, action at law or other appropriate
proceeding,  including as permitted by
applicable law the obtaining of the ex parte appointment of a receiver, and, if
such amount shall have become due, by declaration or otherwise, proceed to
enforce the payment thereof or any other legal or equitable right of such Lenders.

 

(e)                                  Remedies Cumulative.  No remedy herein conferred upon any Lender or
Administrative Agent or the holder of a Note is intended to be exclusive of any
other remedy and 

 

76

 

each
and every remedy shall be cumulative and shall be in addition to every other
remedy given hereunder or now or hereafter existing at law or in equity or by
statute or any other provision of law.

 

(f)                                    Prepayments.  Any prepayment by the Borrower of all or any
part of the Term Loans following an Event of Default and an acceleration of the
original Maturity Date, shall include, as compensation to the Lenders of the
Term Loan for such prepayment, the Applicable Prepayment Premium required under
Section 2.11(g).  The Borrower specifically
acknowledges and agrees that it shall be liable for the prepayment premium on
any acceleration of the Term Loan in accordance with their terms at any time.

 

(g)                                 Licensing of Administrative Agent and Lenders.  In the event of the
occurrence of an Event of Default hereunder or under any of the Loan Documents
and it shall become necessary, or in the opinion of Required Lenders advisable,
for an agent, supervisor, receiver or other representative of Administrative
Agent and Lenders to become licensed under the provisions of the laws and/or
regulations of any Gaming Authority as a condition to receiving the benefit of
any Collateral encumbered by the Mortgages or other Loan Documents for the
benefit of Lenders or otherwise to enforce their rights hereunder, Borrower
hereby gives its consent to the granting of such license or licenses and agrees
to execute such further documents as may be required in connection with the
evidencing of such consent.

 

(h)                                 Exercise of Rights Subject to Applicable Law.  All rights,
remedies and powers provided by this Article VIII may be exercised only to
the extent that the exercise thereof does not violate any applicable provision
of the laws of any Governmental Body and all of the provisions of this Article VIII
are intended to be subject to all applicable mandatory provisions of law that
may be controlling and to be limited to the extent necessary so that they will
not render this Agreement invalid, unenforceable or not entitled to be recorded
or filed under the provisions of any applicable law.

 

ARTICLE IX

Administrative Agent

 

Section 9.1.                                Appointment of Administrative Agent.  Aladdin is hereby appointed Administrative
Agent hereunder and under each other Loan Document, and each Lender hereby
authorizes Aladdin to act as its agent in accordance with the terms hereof and
the other Loan Documents.  
Administrative Agent hereby agrees to act upon the express conditions
contained herein and the other Loan Documents, as applicable.  The provisions of this Article IX are
solely for the benefit of Administrative Agent and the Lenders and no Credit
Party shall have any rights as a third-party beneficiary of any of the
provisions thereof.  In performing its
functions and duties hereunder, Administrative Agent shall act solely as an agent
of the Lenders and does not assume, and shall not be deemed to have assumed,
any obligation towards or relationship of agency or trust with or for the
Borrower or any of its Subsidiaries. 
Administrative Agent, without consent of or notice to any party hereto,
may assign any and all of its rights or obligations hereunder to any of its
Affiliates.

 

Section 9.2.                                Powers and Duties.  Each
Lender irrevocably authorizes Administrative Agent to take such action on such
Lender’s behalf and to exercise such powers, rights and 

 

77

 

remedies hereunder and under
the other Loan Documents as are specifically delegated or granted to
Administrative Agent by the terms hereof and thereof, together with such
powers, rights and remedies as are reasonably incidental thereto.  Administrative Agent shall have only those
duties and responsibilities that are expressly specified herein and the other
Loan Documents.  Administrative Agent may
execute any of its duties under this Agreement and the other Loan Documents by
or through agents or attorneys-in-fact, or may assign such duties to its wholly
owned nominee without the consent of the Lenders, and shall be entitled to rely
on advice of counsel concerning all matters pertaining to such duties.  Administrative Agent shall not have, by
reason hereof or any of the other Loan Documents, a fiduciary relationship in
respect of any Lender and nothing herein or any of the other Loan Documents,
expressed or implied, is intended to or shall be so construed as to impose upon
Administrative Agent any obligations in respect hereof or any of the other Loan
Documents except as expressly set forth herein or therein.

 

Section 9.3.                                Delegation of Duties.  Administrative Agent may execute any of its
duties under this Agreement or any other Loan Document by or through third
parties, agents, employees or attorneys-in-fact (any such entity, a “Sub-Agent”) or may assign such duties to
its wholly owned nominee without the consent of the Lenders, and shall be entitled
to advice of counsel concerning all matters pertaining to such duties.  Administrative Agent shall not be responsible
for the negligence or misconduct of any Sub- Agent that it selects as long as
such selection was made with reasonable care. 
The Borrower and each Lender hereby agree that any Sub- Agent appointed
hereunder shall be entitled to the benefit of the provisions of Sections 7.3,
9.2, 9.4, 9.5, 9.6, 9.7, 9.10 and 9.11 of this Agreement as if such Sub-Agent
is a party to this Agreement.

 

Section 9.4.                                General Immunity.

 

(a)                                  No Responsibility for Certain Matters.  Administrative
Agent shall not be responsible to any Lender for the execution, effectiveness,
genuineness, validity, enforceability, collectability or sufficiency hereof or
any other Loan Document or for any representations, warranties, recitals or
statements made herein or therein or made in any written or oral statements or
in any financial or other statements, instruments, reports or certificates or
any other documents furnished or made by Administrative Agent to any Lender or
by or on behalf of any Credit Party to Administrative Agent or any Lender in
connection with the Loan Documents and the transactions contemplated thereby or
for the financial condition or business affairs of any Credit Party or any
other Person liable for the payment of any Obligations, nor shall
Administrative Agent be required to ascertain or inquire as to the performance
or observance of any of the terms, conditions, provisions, covenants or
agreements contained in any of the Loan Documents or as to the use of the
proceeds of the Term Loans or as to the existence or possible existence of any
Event of Default or Default.  Anything
contained herein to the contrary notwithstanding, Administrative Agent shall
not have any liability arising from confirmations of the amount of the
outstanding Term Loans.

 

(b)                                 Exculpatory Provisions.  None of Administrative Agent nor any of its
officers, trustees, partners, members, directors, employees, attorneys or
agents shall be liable to Lenders for any action taken or omitted by
Administrative Agent under or in connection with any of the Loan Documents,
except to the extent caused by Administrative Agent’s gross negligence or 

 

78

 

willful
misconduct.  Administrative Agent shall
be entitled to refrain from any act or the taking of any action (including the
failure to take an action) in connection herewith or any of the other Loan
Documents or from the exercise of any power, discretion or authority vested in
it hereunder or thereunder unless and until Administrative Agent shall have
received instructions in respect thereof from the Required Lenders (or such
other Lenders as may be required to give such instructions under Section 10.1)
and, upon receipt of such instructions from the Required Lenders (or such other
Lenders, as the case may be), Administrative Agent shall be entitled to act or
(where so instructed) refrain from acting, or to exercise such power,
discretion or authority, in accordance with such instructions.  Without prejudice to the generality of the
foregoing, (i) Administrative Agent shall be entitled to rely, and shall
be fully protected in relying, upon any communication, instrument or document
believed by it to be genuine and correct and to have been signed or sent by the
proper Person or Persons, and shall be entitled to rely and shall be protected
in relying on opinions and judgments of attorneys (who may be attorneys for the
Borrower and its Subsidiaries), accountants, experts and other professional
advisors selected by it, and (ii) no Lender shall have any right of action
whatsoever against Administrative Agent as a result of Administrative Agent
acting or refraining from acting hereunder or any of the other Loan Documents
in accordance with the instructions of the Required Lenders (or such other
Lenders as may be required to give such instructions under Section 10.1).  Administrative Agent shall be fully justified
in failing or refusing to take any action under this Agreement or any other
Loan Document which involves discretionary decision making absent express
written instructions from the Required Lenders with respect thereto.

 

Section 9.5.                                Administrative Agent Entitled to Act with the Borrower.  Administrative Agent and its Affiliates may
accept deposits from, lend money to and generally engage in any kind of
banking, trust, financial advisory or other business with the Borrower or any
of its Affiliates as if it were not performing the duties specified herein, and
may accept fees and other consideration from the Borrower for services in
connection herewith and otherwise without having to account for the same to
Lenders.

 

Section 9.6.                                Lenders’ Representations, Warranties and Acknowledgment.

 

(a)                                  Each Lender represents and warrants that it has made its own
independent investigation of the financial condition and affairs of the
Borrower and its Subsidiaries in connection with the Borrowing(s) hereunder
and that it has made and shall continue to make its own appraisal of the
creditworthiness of the Borrower and its Subsidiaries.  Administrative Agent shall not have any duty
or responsibility, either initially or on a continuing basis, to make any such
investigation or any such appraisal on behalf of Lenders or to provide any
Lender with any credit or other information with respect thereto, whether
coming into its possession before the making of the Term Loans or at any time
or times thereafter, and Administrative Agent shall not have any responsibility
with respect to the accuracy of or the completeness of any information provided
to Lenders.

 

(b)                                 Each Lender, by delivering its signature page to this
Agreement and funding or holding any of its Term Loans on the Closing Date,
shall be deemed to have acknowledged receipt of, and consented to and approved,
each Loan Document and each other document required to be approved by
Administrative Agent or Lenders, as applicable on the Closing Date.

 

79

 

(c)                                  Each Lender represents and warrants that it is in the
business of providing debt capital to enterprises and each Term Loan will be
made in the ordinary course of such Lender’s business.

 

(d)                                 Administrative Agent and each Lender, by delivering its
signature page to this Agreement and funding or holding any of its Term
Loans on the Closing Date agrees, for the 
enforceable benefit of all holders of existing and future Second Lien
Obligations (as defined in the Intercreditor Agreement), and each existing and
future Debt Representative (as defined in the Intercreditor Agreement) as
follows: (x) that Administrative Agent and the Lenders are bound by the
provisions of, and agree to the terms of, the Intercreditor Agreement
(including Section 5.6 of the Intercreditor Agreement) and (y) that
each Lender consents to and directs Administrative Agent to perform its
obligations under the Intercreditor Agreement.

 

Section 9.7.                                Right to Indemnity.  Each
Lender, in proportion to its Pro Rata Share, severally (and not jointly) agrees
to indemnify Administrative Agent and its stockholders, directors, officers,
employees, agents, attorneys and Affiliates (each an “Indemnified Administrative Agent Person”),
to the extent that Administrative Agent shall not have been reimbursed by any
Credit Party, for and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses (including legal
fees and disbursements) or disbursements of any kind or nature whatsoever which
may be imposed on, incurred by or asserted against such Indemnified
Administrative Agent Person in exercising its powers, rights and remedies or
performing its duties hereunder or under the other Loan Documents or otherwise
in its capacity as Administrative Agent in any way relating to or arising out
hereof or in connection with the Loan Documents; provided, no Lender
shall be liable for any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
resulting from Administrative Agent’s gross negligence or willful
misconduct.  If any indemnity furnished
to Administrative Agent for any purpose shall, in the opinion of such
Administrative Agent, be insufficient or become impaired, Administrative Agent
may call for additional indemnity and cease, or not commence, to do the acts
indemnified against until such additional indemnity is furnished; provided,
further, in no event shall this sentence require any Lender to indemnify
Administrative Agent against any liability, obligation, loss, damage, penalty,
action, judgment, suit, cost, expense or disbursement in excess of such Lender’s
Pro Rata Share thereof, and provided, further, this sentence
shall not be deemed to require any Lender to indemnify Administrative Agent
against any liability, obligation, loss, damage, penalty, action, judgment,
suit, cost, expense or disbursement described in the proviso in the immediately
preceding sentence.

 

Section 9.8.                                Successor Administrative Agent.

 

(a)                                  Administrative Agent may resign at any time by giving not
less than thirty (30) Business Days’ prior written notice thereof to the
Lenders and the Borrower.  Upon any such
resignation, the Required Lenders shall have the right to appoint a successor
Administrative Agent, which shall be (i) one of the Lenders or an
Affiliate of one of the Lenders or (ii) a Person who would be an eligible
successor agent if appointed by the resigning Administrative Agent under Section 9.8(b).

 

80

 

(b)                                 If no successor Administrative Agent shall have been so
appointed by the Lenders within twenty (20) Business Days after the resigning
Administrative Agent’s giving of notice of resignation, then the resigning
Administrative Agent may appoint, on behalf of the Borrower and the Lenders, a
successor Administrative Agent, which shall be a commercial bank organized
under the laws of the United States of America or of any state thereof and
having a combined capital and surplus of at least $250,000,000.  In the event that Administrative Agent is
unable to appoint a replacement successor within ten (10) Business Days
after it is entitled to do so after using reasonable efforts, Administrative
Agent may nonetheless resign by delivering a written resignation to the Lenders
and the Borrower, provided that in such circumstances, and unless and
until a successor Administrative Agent is appointed, Administrative Agent shall
remain Administrative Agent solely for the purpose of serving as secured party
of record with respect to the Collateral, its sole duty in that capacity shall
be to take such ministerial actions as it shall be directed to take by the
Lenders (including, without limitation, the execution and delivery of documents
or instruments relating to the Collateral), and Administrative Agent shall be
entitled to reimbursement from the Borrower for its reasonable out-of-pocket
costs and expenses and reasonable compensation from the Borrower for its
services.  If Administrative Agent has
resigned and no successor Administrative Agent has been appointed, subject to
the preceding sentence, the Lenders shall perform the duties of Administrative
Agent hereunder, and the Borrower shall make all payments in respect of the
Obligations to the applicable Lenders and shall deal directly with the Lenders.

 

(c)                                  No successor Administrative Agent shall be deemed to be
appointed hereunder until such successor Administrative Agent has accepted the
appointment in writing.  Upon the
acceptance of any appointment as Administrative Agent hereunder by a successor
Administrative Agent and upon the execution and filing of such financing
statements, or amendments thereto, and such other instruments and notices, as
may be necessary or desirable or as the Required Lenders may request, in order
to continue the perfection of the Liens granted or purported to be granted
under the Security Documentation, such successor Administrative Agent shall
succeed to and become vested with all the rights, powers, discretion,
privileges and duties of the resigning Administrative Agent, and the
resignation or termination of Administrative Agent shall then be effective for
all purposes.  Upon the effectiveness of
the resignation or termination of Administrative Agent, the resigning or
terminated Administrative Agent shall be discharged from its duties and
obligations under the Loan Documents. 
After the effectiveness of the resignation or termination of an
Administrative Agent, the provisions of Section 7.3 and this Article IX
shall continue to inure to the former Administrative Agent’s benefit as to any
actions taken or omitted to be taken by it while it was acting as
Administrative Agent under this Agreement.

 

Section 9.9.                                Security Documentation.

 

(a)                                  Administrative Agent as Administrative Agent under Security
Documentation.  Each Lender hereby further authorizes
Administrative Agent, on behalf of and for the benefit of the Lenders, to be
Administrative Agent for and representative of the Lenders with respect to the
Collateral and the Security Documentation. 
Subject to Section 10.1, without further written consent or
authorization from the Lenders, Administrative Agent may execute any documents
or instruments necessary to release any Lien encumbering any item of Collateral
that is the subject

 

81

 

of
a sale or other disposition of assets permitted hereby or to which the Lenders
have otherwise consented in the manner provided herein.

 

(b)                                 Administrative Agent’s Right to Realize on Collateral.  Anything contained
in any of the Loan Documents to the contrary notwithstanding, the Borrower,
Administrative Agent and each Lender hereby agree that (i) no Lender shall
have any right individually to realize upon any of the Collateral, it being
understood and agreed that all powers, rights and remedies hereunder may be
exercised solely by Administrative Agent, on behalf of Lenders in accordance
with the terms hereof, and (ii) in the event of a foreclosure by
Administrative Agent on any of the Collateral pursuant to a public or private
sale, Administrative Agent or any Lender may be the purchaser of any or all of
such Collateral at any such sale and Administrative Agent, as agent for and
representative of Lenders (but not any Lender or Lenders in its or their
respective individual capacities unless the Required Lenders shall otherwise
agree in writing) shall be entitled, for the purpose of bidding and making
settlement or payment of the purchase price for all or any portion of the
Collateral sold at any such public sale, to use and apply any of the
Obligations as a credit on account of the purchase price for any collateral
payable by Administrative Agent at such sale.

 

Section 9.10.                         Notice of Default. 
Administrative Agent shall not be deemed to have knowledge or notice of
the occurrence of any Default or Event of Default hereunder unless
Administrative Agent has received notice from a Lender or the Borrower
referring to this Agreement, describing such Default or Event of Default and
stating that such notice is a “notice of default”.  In the event that Administrative Agent
receives such a notice, Administrative Agent shall promptly give notice thereof
to the Lenders and, if required by any Gaming Authority, the Borrower shall
forward a copy of such notice to such Gaming Authority.  Administrative Agent shall take such action
with respect to such Default or Event of Default as shall be reasonably
directed by the Required Lenders; provided that unless and until
Administrative Agent shall have received such directions, Administrative Agent
may (but shall not be obligated to) take such action, or refrain from taking
such action, with respect to such Default or Event of Default as it shall deem
advisable in the best interests of the Lenders.

 

Section 9.11.                         Delivery of Documents, Notices, Etc.  In addition to, and in furtherance of any
requirement placed upon Administrative Agent herein to deliver, provide,
distribute, notify or otherwise convey items received from the Borrower to the
Lenders, Administrative Agent shall promptly notify Lenders of any notices,
documents, requests, demands or other items Administrative Agent received from
the Borrower and promptly deliver or convey, to the extent they are in written
form, such notices, documents, requests, demands or items to the Lenders.

 

ARTICLE X

Miscellaneous

 

Section 10.1.                         Amendments and Waivers.

 

(a)                                  General.  Subject to Section 10.1(b) and Section 10.1(c) below,
no amendment, modification, termination or waiver of any provision of the Loan
Documents, or consent to any departure by any Credit Party therefrom, shall be
effective without the written consent of the Required Lenders.

 

82

 

(b)                                 Other Consent.  Notwithstanding the provisions of Section 10.1(a) above,
no amendment, modification, termination or waiver of any provision of the Loan
Documents, or consent to any departure by any Credit Party therefrom, shall:

 

(i)                                     amend, modify,
terminate or waive any provision of Article IX as the same applies to
Administrative Agent, or any other provision hereof as the same applies to the
rights or obligations of Administrative Agent, in each case without the consent
of Administrative Agent;

 

(ii)                                  increase any
Term Loan Commitment of any Lender over the amount thereof then in effect
without the consent of such Lender; provided that no amendment,
modification, termination or waiver of any condition precedent, covenant
(including any amendment, modification, termination or waiver of the voluntary
or mandatory prepayment covenants), Default or Event of Default shall
constitute an increase in any Term Loan Commitment of any Lender.

 

(c)                                  Prior Unanimous Written Consent.  Without the prior
unanimous written consent of the affected Lenders:

 

(i)                                     no amendment,
consent or waiver shall (A) affect the amount or extend the time of the
obligation of any Lender to make the Term Loans or (B) extend the
originally scheduled time or times of repayment of the principal of the Term
Loans or (C) alter the time or times of payment of interest on the Term
Loans or of any fees payable for the account of the Lenders or (D) alter
the amount of the principal of the Term Loans or the rate of interest thereon
or (E) alter the amount of any fee payable hereunder to the account of the
Lenders or (F) permit any subordination of the principal of or interest on
the Term Loans or (G) permit the subordination of the Lien created by the
Security Documentation in any of the Collateral or (H) consent to the
assignment or transfer by any Credit Party of any of its rights and obligations
under any Loan Document or (I) affect the definition of “Required Lenders”
or “Pro Rata Share”;

 

(ii)                                  no Collateral,
other than in connection with an Asset Sale or any other sale made in
accordance with the terms hereof or as otherwise specifically permitted in this
Agreement or the Security Documentation, shall be released from the Lien of the
Security Documentation;

 

(iii)                               none of the
provisions of Section 2.14 shall be amended, modified or waived; and

 

(iv)                              none of the
provisions of Section 10.1(b) or this Section 10.1(c) shall
be amended.

 

(d)                                 Effect of Notices, Waivers or Consents.  Any waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which it was given.  No
notice to or demand on any Credit Party in any case shall entitle any Credit
Party to any other or further notice (except as otherwise specifically required
hereunder or under any other Loan Document) or demand in similar or other
circumstances.  Any amendment,
modification, termination, waiver 

 

83

 

or
consent effected in accordance with this Section 10.1 shall be binding
upon each Lender at the time outstanding, each future Lender and, if signed by
a Credit Party, on such Credit Party.

 

Section 10.2.                         Notices.  All notices,
requests, demands and other communications to any party or given under any Loan
Document (collectively, the “Notices”)
will be in writing and delivered initially by electronic mail to the e-mail
address listed below to be followed by delivery by overnight courier or by
registered mail to the parties at the following address or sent by facsimile,
with confirmation received, to the facsimile number specified below (or at such
other address or facsimile number as will be specified by a party by like
notice given at least five calendar days prior thereto):

 

(a)                                  If to the Borrower, at:

 

MTR
Gaming Group, Inc.

State
Route 2 South

P.O. Box
356

Chester,
WV 26034

Attention:
Chief Financial Officer

Facsimile:
(304) 387-2167

 

with
a copy to:

 

Milbank
Tweed Hadley & McCloy LLP

601
South Figueroa Street, 30th Floor

Los
Angeles, California 90017

Facsimile:
213-892-4771 (Ruosch) and 213-892-4748 (Song)

Attention:
Deborah Ruosch and Wansun Song

 

(b)                                 If to Administrative Agent, at:

 

Aladdin
Credit Partners LLC

6
Landmark Square

Stamford,
CT 06901

	
  Attention:

  	
  Simmon
  Saraf

  
	
  Telephone:

  	
  (203)
  326-6891

  
	
  Facsimile:

  	
  (203)
  487-6740

  
	
  Email:

  	
  ssaraf@aladdincapital.com

  

 

With
a copy to:

 

Richards
Kibbe & Orbe LLP

One
World Financial Center

New
York, New York 10281

	
  Telephone:

  	
  (212)
  530-1800

  
	
  Facsimile:

  	
  (212)
  530-1801

  
	
  Attention:

  	
  Nicholas
  A. Whitney

  
	
  Email:

  	
  nwhitney@rkollp.com

  

 

84

 

(c)                                  If (i) to the Lenders that are related funds of
Administrative Agent, to the notice address for Administrative Agent provided
above and (ii) to any other Lender, to the address for such Lender set
forth on the signature pages hereof or in the Assignment Agreement
delivered by such Lender.

 

All Notices will be deemed delivered when actually
received.  Each of the parties will
hereafter notify the other parties in accordance with this Section 10.2 of
any change of address or telecopy number to which notice is required to be
mailed.

 

Section 10.3.                         Expenses.  Whether or
not the transactions contemplated hereby shall be consummated or any Term Loan
shall be made, the Borrower agrees to pay promptly:

 

(a)                                  all the actual and reasonable and reasonably documented
costs and expenses of preparation of the Loan Documents and any consents,
amendments, waivers or other modifications thereto; the reasonable and
reasonably documented fees, expenses and disbursements of counsel to
Administrative Agent in connection with the negotiation, preparation, execution
and administration of the Loan Documents and any consents, amendments,
supplements, waivers or other modifications thereto and any other documents or
matters requested by the Borrower;

 

(b)                                 all the actual costs and reasonable and reasonably
documented expenses of creating and perfecting Liens in favor of Administrative
Agent, for the benefit of the Secured Parties, pursuant hereto, including,
without limitation, filing and recording fees, expenses and taxes, stamp or
documentary taxes, search fees, title insurance premiums and reasonable fees,
expenses and disbursements of counsel to Administrative Agent and Lenders; and

 

(c)                                  after the occurrence of a Default or an Event of Default,
all costs and expenses, including reasonable attorneys’ fees (including,
without limitation, allocated costs of internal counsel), auditors,
accountants, consultants, advisors, agents and appraisers and costs of
settlement, incurred by any Administrative Agent and/or Lenders in enforcing
any Obligations of or in collecting any payments due from any Credit Party
hereunder or under the other Loan Documents by reason of such Default or Event
of Default (including in connection with the sale of, collection from, or other
realization upon any of the Collateral or the enforcement of any guaranty) or
in connection with any negotiations, reviews, refinancing or restructuring of
the credit arrangements provided hereunder, including, without limitation, in
the nature of a “work out” or pursuant to any insolvency or bankruptcy cases or
proceedings.

 

Section 10.4.                         Enforceability; Successors and Assigns.

 

(a)                                  Enforceability; Successors and Assigns.  This Agreement will
be binding upon and inure to the benefit of and is enforceable by the
respective successors and permitted assigns of the parties hereto.  This Agreement may not be assigned by the
Borrower hereto without the prior written consent of Administrative Agent and
each Lender.  Any assignment or attempted
assignment in contravention of this Section 10.4 will be void ab initio
and will not relieve the assigning party of any obligation under this
Agreement.

 

85

 

(b)                                 Assignments.  Each Lender may assign (each, an “Assignment”) to one or more Eligible
Assignees (each, an “Assignee”)
all or a portion of its rights and obligations under this Agreement (including
all or a portion of such Lender’s Term Loans and Notes, as the case may
be).  Assignment shall be subject to the
following:

 

(i)                                     Assignments
shall be made with the prior written consent (not to be unreasonably withheld
or delayed) of Administrative Agent, provided that no consent of Administrative
Agent shall be required for an assignment to an assignee that is a Lender or an
Affiliate of a Lender or an Approved Fund;

 

(ii)                                  except in the
case of an assignment to a Lender or an Affiliate of a Lender or to an Approved
Fund, the amount of the Term Loan of the assigning Lender subject to each such
assignment (determined as of the date the Assignment Agreement with respect to
such assignment is delivered to Administrative Agent) shall not be less than
$1,000,000 or an assignment of the entire remaining amount of the assigning
Lender’s Term Loan (if less than $1,000,000) unless Administrative Agent
otherwise consents;

 

(iii)                               the parties to
each assignment shall execute and deliver to Administrative Agent an Assignment
Agreement, in the form of Exhibit 10.4(b) (each, an “Assignment Agreement”); and

 

(iv)                              upon its
receipt of a duly executed and completed Assignment Agreement, Administrative
Agent shall record the information contained in such Assignment Agreement in
the Register, shall give prompt notice thereof to the Borrower and shall
maintain a copy of such Assignment Agreement in its Principal Office.  From and after the effective date of an
Assignment, the Assignee shall be a party hereto and, to the extent of the
interest assigned pursuant to the Assignment, have the rights and obligations
of a “Lender” under this Agreement, and the assigning Lender shall, to the
extent of the interest assigned, be released from its obligations under this
Agreement.  The Borrower hereby consents
to the disclosure of any information obtained by Lender in connection with this
Agreement to any Person to which such Lender sells, or proposes to sell, its
Term Loans or Notes.

 

(c)                                  Participations.  Each Lender may sell participations to one or
more Persons in all or a portion of such Lender’s rights and obligations under
this Agreement (including all or a portion of such Lender’s Term Loans and
Notes, as the case may be); provided that (i) such Lender’s
obligations under this Agreement shall remain unchanged, (ii) such Lender
shall remain solely responsible to the Borrower for the performance of such
obligations, and (iii) the Borrower and Administrative Agent shall
continue to deal solely and directly with such Lender in connection with such
Lender’s rights and obligations under this Agreement.  Any agreement or instrument pursuant to which
such Lender sells a participation shall provide that such Lender shall retain
the sole right to enforce 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, agree to any amendment, modification or
waiver to (i) extend the final scheduled maturity of any Term Loan or Note
in which such participant is participating, or reduce the rate or extend the
time of payment of interest or fees thereon (except in connection with a waiver
of applicability of any 

 

86

 

post-default
increase in interest rates) or reduce the principal amount thereof, or increase
the amount of the participant’s participation over the amount thereof then in
effect, (ii) consent to the assignment or transfer by any Credit Party of
any of its rights and obligations under this Agreement or (iii) release
all or substantially all of the Collateral under the Security Documentation or
all or substantially all of the Guarantors from the Guaranty (in each case,
except as expressly provided in the Loan Documents) supporting the Term Loans
hereunder.  The Borrower agrees that each
participant also shall be entitled to the benefits of Section 7.1, 7.2 and
7.5 to the same extent as if it were a Lender and had acquired its interest by
assignment pursuant to clause (b) of this Section; provided that (i) a
participant shall not be entitled to receive any greater payment under Section 7.1
or 7.2 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 and (ii) a participant that would be a Foreign Lender if it were a
Lender shall not be entitled to the benefits of Section 7.2 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 Section 7.2
as through it were a Lender. To the extent permitted by law, each participant
shall be entitled to the benefits of Section 7.4 as though it were a
Lender, provided such participant agrees to be subject to Section 2.14 as
through it were a Lender.  The Borrower hereby consents to the disclosure of any
information obtained by a Lender in connection with this Agreement and/or any
other Loan Document to any Person to which such Lender participates, or
proposes to participate, its Term Loans or Notes.

 

(d)                                 In the event any Lender is found unsuitable as a Lender
under the Credit Agreement by any Gaming Authority (“Unsuitable Lender”), then to the extent permitted by
applicable laws: (a) the Borrower shall have the right to make a voluntary
prepayment of the Term Loans in the amount necessary to reduce the aggregate
Term Loan Commitment by the amount of the Term Loans held by the Unsuitable
Lender, and any payments required in connection with such prepayment shall be
made to the Unsuitable Lender and not on a pro rata basis to all Lenders,
(together with the Applicable Prepayment Premium but otherwise, without any
additional penalties, including any LIBOR breakage costs) until a replacement
Lender, if any, commits to acquire the Term Loans of the Unsuitable Lender, at
which time the aggregate Term Loan Commitment shall be increased by the amount
of such prepayment, and (b) upon full payment of all outstanding amounts
of principal and interest owing it, such Unsuitable Lender shall execute such
documents as may be required by Administrative Agent, the Borrower or any
applicable Gaming Authority to evidence that such Unsuitable Lender no longer
retains any interest under the Credit Documents (other than provisions that
expressly survive the repayment in full of the Obligations).  No Credit Party shall be required to pay or
reimburse any Unsuitable Lender in applying for a license, qualification or a
finding of suitability.

 

(e)                                  Notwithstanding anything else to the contrary contained
herein, any Lender may any time pledge its Term Loans and such Lender’s rights
under this Agreement and the other Loan Documents to a Federal Reserve Bank
and, in the case of any Lender that is a fund, to its trustee for the benefit
of its investors; provided, that no such pledge to a Federal Reserve
Bank (or in the case of any Lender that is a fund, to its trustee for the
benefit of its investors) shall release such Lender from such Lender’s
obligations hereunder or under any other Credit 
Document.

 

87

 

Section 10.5.                         Lenders’ Obligations Several; Independent Nature of Lenders’ Rights.  The obligation of each Lender hereunder is
several and not joint and neither Administrative Agent nor any Lender shall be
responsible for the obligation of any other Lender hereunder.  Nothing contained in any Loan Document and no
action taken by Administrative Agent or any Lender pursuant hereto or thereto
shall be deemed to constitute Lenders to be a partnership, an association, a
joint venture or any other kind of entity. 
The amounts payable at any time hereunder to each Lender shall be a
separate and independent debt, and, provided Administrative Agent fails or
refuses to exercise any independent debt, and, provided Administrative Agent
fails or refuses to exercise any remedies against the Borrower after receiving
the direction of the Lenders, each Lender shall be entitled to protect and
enforce its rights arising out of this Agreement and it shall not be necessary
for any other Lender to be joined as an additional party in any proceeding for
such purpose.

 

Section 10.6.                         Integration.  This
Agreement and the other Loan Documents contain and constitute the entire
agreement of the parties with respect to the subject matter hereof and
supersede all prior negotiations, agreements and understandings, whether
written or oral, of the parties hereto.

 

Section 10.7.                         No Waiver; Remedies.  No failure or delay by any party in
exercising any right, power or privilege under this Agreement or any of the
other Loan Documents will operate as a waiver of such right, power or
privilege.  A single or partial exercise
of any right, power or privilege will not preclude any other or further
exercise of the right, power or privilege or the exercise of any other right,
power or privilege.  The rights and
remedies provided in the Loan Documents will be cumulative and not exclusive of
any rights or remedies provided by law.

 

Section 10.8.                         Submission to Jurisdiction.  Each Credit Party, Administrative Agent and
the Lenders hereby (a) agrees that any Action with respect to any Loan
Document may be brought only in the New York State courts sitting in New York
County or federal courts of the United States of America sitting in the
Southern District of New York and New York County, (b) accepts for itself
and in respect of its property, generally and unconditionally, the exclusive
jurisdiction of such courts, (c) irrevocably waives any objection,
including, without limitation, any objection to the laying of venue or based on
the grounds of forum non conveniens, which it may now or hereafter have
to the bringing of any Action in those jurisdictions, and (d) irrevocably
consents to the service of process of any of the courts referred to above in
any Action by the mailing of copies of the process to the parties hereto as
provided in Section 10.2.  Service
effected as provided in this manner will become effective ten (10) calendar
days after the mailing of the process.

 

Section 10.9.                         Execution in Counterparts.  This Agreement may be executed in any number
of counterparts and by different parties on separate counterparts, each of
which, when executed and delivered, shall be deemed to be an original, and all
of which, when taken together, shall constitute but one and the same
Agreement.  Delivery of an executed
counterpart of this Agreement by facsimile or a scanned copy by electronic mail
shall be equally as effective as delivery of an original executed counterpart
of this Agreement.

 

Section 10.10.                  Governing Law.  This
Agreement and the other Loan Documents, and all claims, disputes and matters
arising hereunder or thereunder or related hereto or thereto, will be 

 

88

 

governed by, and construed
in accordance with, the laws of the state of New York applicable to contracts
executed in and to be performed entirely within that state, without reference
to conflicts of laws provisions.

 

Section 10.11.                  Waiver of Jury.  THE
PARTIES HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY RIGHT THAT THEY MAY HAVE TO TRIAL BY JURY
OF ANY CLAIM OR CAUSE OF ACTION, OR IN ANY LEGAL PROCEEDING, DIRECTLY OR
INDIRECTLY BASED UPON OR ARISING OUT OF THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT (WHETHER BASED ON CONTRACT, TORT, OR ANY OTHER
THEORY).  EACH PARTY (A) CERTIFIES
THAT NO REPRESENTATIVE, ADMINISTRATIVE AGENT, OR ATTORNEY OF ANY OTHER PARTY
HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN
THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES
THAT IT AND THE OTHER PARTIES HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT
BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

 

Section 10.12.                  Severability.  If any term
or other provision of this Agreement is invalid, illegal or incapable of being
enforced by any rule of law, or public policy, all other conditions and
provisions of this Agreement will nevertheless remain in full force and effect
so long as the economic or legal substance of the transactions contemplated
hereby is not affected in any manner adverse to any party.  Upon such determination that any term or
other provision is invalid, illegal or incapable of being enforced, the parties
hereto will negotiate in good faith to modify this Agreement so as to effect
the original intent of the parties as closely as possible in an acceptable manner
to the end that the transactions contemplated hereby are fulfilled to the
extent possible.

 

Section 10.13.                  Survival.  All
representations, warranties, covenants, agreements, and conditions contained in
or made pursuant to this Agreement or the other Loan Documents shall survive (a) the
making of the Term Loans and the payment of the Obligations and (b) the
performance, observance and compliance with the covenants, terms and
conditions, express or implied, of all Loan Documents, until the due and
punctual (i) indefeasible payment of the Obligations and (ii) performance,
observance and compliance with the covenants, terms and conditions, express or
implied, of this Agreement and all of the other Loan Documents; provided,
however, that the provisions of Section 5.16, Section 7.1, Section 7.2,
Section 7.3, Section 9.4, Section 9.6 and Section 9.7 shall
survive (i) indefeasible payment of the Obligations and (ii) performance,
observance and compliance with the covenants, terms and conditions, express or
implied, of this Agreement and all of the other Loan Documents.

 

Section 10.14.                  Maximum Lawful Interest.  Notwithstanding anything to the contrary
contained herein, in no event shall the amount of interest and other charges
for the use of money payable under this Agreement or any other Loan Document
exceed the maximum amounts permissible under any law that a court of competent
jurisdiction shall, in a final determination, deem applicable.  The Borrower and the Lenders, in executing
and delivering this Agreement, intend legally to agree upon the rate or rates
of interest and other charges for the use of money and manner of payment stated
within it; provided, however, that, anything contained herein to

 

89

 

the contrary
notwithstanding, if the amount of such interest and other charges for the use
of money or manner of payment exceeds the maximum amount allowable under
applicable law, then, ipso  facto as of the Closing Date, the
Borrower is and shall be liable only for the payment of such maximum as allowed
by law, and payment received from the Borrower in excess of such legal maximum,
whenever received, shall be applied to reduce the principal balance of the Term
Loans to the extent of such excess.

 

Section 10.15.                  Interpretation.  As
used in this Agreement, references to the singular will include the plural and
vice versa and references to the masculine gender will include the feminine and
neuter genders and vice versa, as appropriate. 
Unless otherwise expressly provided in this Agreement (a) the words
“hereof”, “herein” and “hereunder” and words of similar import when used in
this Agreement will refer to this Agreement as a whole and not to any
particular provision of this Agreement and (b) article, section, subsection,
schedule and exhibit references are references with respect to this Agreement
unless otherwise specified.  Unless the
context otherwise requires, the term “including” will mean “including, without
limitation.”  The headings in this
Agreement and in the Schedules are included for convenience of reference only
and will not affect in any way the meaning or interpretation of this Agreement.

 

Section 10.16.                  Ambiguities.  This
Agreement and the other Loan Documents were negotiated between legal counsel
for the parties and any ambiguity in this Agreement or the other Loan Documents
shall not be construed against the party who drafted this Agreement or such
other Loan Documents.

 

Section 10.17.                  First Lien Obligations.  The Borrower and each other Credit Party
acknowledges and agrees that (a) the Obligations hereunder have been used
to “Refinance” (as such term is defined in the Intercreditor Agreement) all
outstanding obligations under the Existing Agreement, (b) the Obligations
shall constitute “First Lien Obligations” (as defined in the Intercreditor
Agreement) for all purposes of the Intercreditor Agreement, including, without
limitation, Section 6.1 thereof, (c) this Agreement shall constitute
a “Credit Agreement” (as defined in the Senior Secured Notes Indenture) for all
purposes of the Senior Secured Notes Indenture, (d) (i) this
Agreement shall constitute the “First Lien Credit Agreement”, (ii) the
Loan Documents shall constitute the “First Lien Loan Documents”, (iii) the
“Term Loans” shall constitute “First Lien Loans” and (iv) the Security
Documentation shall constitute “First Lien Security Documents”, in each case,
for all purposes of the Intercreditor Agreement and (e) the Obligations
shall constitute “Senior Debt” and “Designated Senior Debt” (as each such term
is defined in the Subordinated Notes Indenture) for all purposes of the
Subordinated Notes Indenture.

 

Section 10.18.                  Confidentiality. 
Administrative Agent and each Lender agrees to hold any non-public
information that it may receive from the Borrower or any other Credit Party
pursuant to this Agreement (or pursuant to any other Loan Document) in
confidence and consistent with their respective policies for handling material
non-public information, except for disclosure: (a) to the other Lenders;
(b) to legal counsel and accountants for the Borrower, any other Credit
Party, Administrative Agent or any Lender; (c) to the other professional
advisors to the Borrower, any other Credit Party, Administrative Agent or any
Lender, provided that the recipient is advised of and agrees to be bound by the
provisions of this Section 10.18; (d) to regulatory officials having
jurisdiction over Administrative Agent or the applicable Lender; (e)

 

90

 

to any Gaming Authority
having regulatory jurisdiction over the Borrower or any other Credit Party,
provided that each of Administrative Agent and the Lenders agrees to endeavor
to notify the Borrower of any such disclosure; (f) As required by law or
legal process or in connection with any legal proceeding, provided that such
disclosing Administrative Agent or Lender uses reasonable efforts to notify the
Borrower prior to any such disclosure; (g) to any rating agency when
required by it, provided that, prior to any disclosure, such rating agency
shall undertake in writing to preserve the confidentiality of any confidential
information relating to the Credit Parties received by it from Administrative
Agent or any Lender; and (h) to another financial institution in connection
with a disposition or proposed disposition to that financial institution of all
or part of that Lender’s Term Loans hereunder, whether by assignment or
participation, provided that the recipient is advised of and agrees to be bound
by the provisions of this Section 10.18. 
For purposes of the foregoing, “non-public information” shall mean any
information respecting the Borrower or any other Credit Party reasonably
considered by the Borrower to be material and not available to the public and
which has been identified as such by the applicable Credit Party, other than
(i) information previously filed with any governmental agency and
available to the public, (ii) information which is available to the
general public at the time of use or disclosure, (iii) information which
becomes available to the general public, other than by manner of unauthorized
disclosure or use, or (iv) information previously published in any public
medium from a source other than, directly or indirectly, Administrative Agent
or any Lender.  Nothing in this Section shall
be construed to create or give rise to any fiduciary duty on the part of
Administrative Agent or the Lenders to the Borrower or any other Credit Party.

 

Section 10.19.                  Additional Gaming Provisions.

 

(a)                                  Notwithstanding anything contained in this Agreement or in
the Security Documentation to the contrary relating to Collateral located in
the Commonwealth of Pennsylvania, Administrative Agent hereby confirms that it
does not and will not have or otherwise claim a security interest in, or lien
on, monies and other funds on account for taxes owed to the Commonwealth of
Pennsylvania under Chapter 14 of the Pennsylvania Race Horse Development and
Gaming Act, 4 Pa. Cons. Stat. Ann. § 1101 et. seq.

 

(b)                                 The Lenders acknowledge that (i) the PGCB has the
authority pursuant to 58 Pa. Code § 441a.13 to review agreements pertaining to
PIDI, (ii) if the PGCB finds that an agreement is not in the public
interest or is inimical to the interest of gaming in the Commonwealth of
Pennsylvania, the PGCB may, by order, require the termination of the agreement
or association of any person associated therewith, or pursue any remedy or
combination of remedies authorized by applicable law.  The Lenders further acknowledge that the
Borrower and the Guarantors may terminate this Agreement, or any related Loan
Document, if the PGCB orders the termination of this Agreement or any related
Loan Document pursuant to 58 Pa. Code § 441a.13.  Upon any such termination an Event of Default
shall have occurred and be continuing and all Obligations (including the
Applicable Prepayment Premium) shall be immediately due and payable.

 

Notwithstanding anything contained in
this Agreement or in the Security Documentation to the contrary, the Collateral
shall not include, and no security interest shall be granted with respect to,
any Gaming License or Gaming Equipment if and to the extent that a security
interest in such Gaming License or Gaming Equipment (i) is prohibited by
applicable law, rule or

 

91

 

regulation
or (ii) requires the consent of any Governmental Authority or Gaming
Authority (including, but not limited to, the West Virginia Lottery
Commission)  which has not yet been
obtained.

 

Lenders acknowledge that (i) any
lender that is not a bank or other licensed lending institution must be
approved by the West Virginia Lottery Commission prior to the extension of
credit and (ii) although advance approval is not required by the PGCB, the
PGCB retains the right, upon a finding of probable cause, to investigate the
suitability of lenders; provided, that the Credit Parties acknowledge
that as of the Closing Date, the Lenders party hereto have been approved by the
West Virginia Lottery Commission.

 

[Remainder of page intentionally left blank; signatures on
following pages.]

 

92

 

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

 

	
   

  	
  BORROWER:

  
	
   

  	
   

  
	
   

  	
  MTR
  GAMING GROUP, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  DAVID R. HUGHES

  
	
   

  	
   

  	
  Name:
  David R. Hughes

  
	
   

  	
   

  	
  Title:
  Corporate Executive Vice President and Chief Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  GUARANTORS:

  
	
   

  	
   

  	
   

  
	
   

  	
  MOUNTAINEER
  PARK, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  JOHN W. BITTNER, JR.

  
	
   

  	
   

  	
  Name:
  John W. Bittner, Jr.

  
	
   

  	
   

  	
  Title:
  Treasurer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  PRESQUE
  ISLE DOWNS, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  JOHN W. BITTNER, JR.

  
	
   

  	
   

  	
  Name:
  John W. Bittner, Jr.

  
	
   

  	
   

  	
  Title:
  Chief Financial Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  SCIOTO
  DOWNS, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  JOHN W. BITTNER, JR.

  
	
   

  	
   

  	
  Name:
  John W. Bittner, Jr.

  
	
   

  	
   

  	
  Title:
  Chief Financial Officer

  

 

[SIGNATURE
PAGE TO CREDIT AGREEMENT]

 

 

	
   

  	
  ADMINISTRATIVE
  AGENT:

  
	
   

  	
   

  
	
   

  	
  ALADDIN
  CREDIT ADVISORS, L.P.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  ACA
  Holdings LLC, its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  LUKE GOSSELIN

  
	
   

  	
   

  	
  Name:
  Luke Gosselin

  
	
   

  	
   

  	
  Title:
  Managing Member

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  LENDERS:

  
	
   

  	
   

  	
   

  
	
   

  	
  ALADDIN
  CREDIT PARTNERS I, L.P.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   Aladdin Credit Partners, LLC, its General
  Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  LUKE GOSSELIN

  
	
   

  	
   

  	
  Name:
  Luke Gosselin

  
	
   

  	
   

  	
  Title:
  Managing Member

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  ALADDIN
  CREDIT INTERMEDIATE FUND LLC

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Aladdin
  Credit Offshore Fund I, L.P., its Managing Member

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Aladdin
  Credit Advisors, LLC, its General Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  LUKE GOSSELIN

  
	
   

  	
   

  	
  Name:
  Luke Gosselin

  
	
   

  	
   

  	
  Title:
  Managing Member

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  MC
  CREDIT PRODUCTS DIP SMA, L.P.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   Aladdin Credit Partners, LLC, its General
  Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  LUKE GOSSELIN

  
	
   

  	
   

  	
  Name:
  Luke Gosselin

  
	
   

  	
   

  	
  Title:
  Managing Member

  

 

[SIGNATURE
PAGE TO CREDIT AGREEMENT]

 

 

SCHEDULE 2.1

 

TERM LOAN COMMITMENTS

 

	
  Lender

  	
   

  	
  Term Loan Commitments

  	
   

  
	
  Aladdin Credit Partners I, L.P.

  	
   

  	
  $

  	
  264,000

  	
   

  
	
  Aladdin Credit Intermediate Fund LLC

  	
   

  	
  $

  	
  17,988,000

  	
   

  
	
  MC Credit Products DIP SMA, L.P.

  	
   

  	
  $

  	
  1,748,000

  	
   

  
	
  Total

  	
   

  	
  $

  	
  20,000,000Exhibit 4.1

 

Execution Version

 

INDENTURE

 

DATED AS OF MARCH 15, 2010,

 

AMONG

 

AVENTINE RENEWABLE ENERGY HOLDINGS, INC.,

 

AS ISSUER,

 

THE GUARANTORS NAMED HEREIN,

 

AS GUARANTORS,

 

AND

 

WILMINGTON TRUST FSB,

 

AS TRUSTEE AND COLLATERAL AGENT

 

13% SENIOR SECURED NOTES DUE 2015

 

 

TABLE OF CONTENTS

 

	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  ARTICLE ONE DEFINITIONS AND
  INCORPORATION BY REFERENCE

  	
   

  	
  1

  
	
   

  	
  SECTION 1.01

  	
  Definitions

  	
   

  	
  1

  
	
   

  	
  SECTION 1.02

  	
  Incorporation by Reference of Trust Indenture Act

  	
   

  	
  37

  
	
   

  	
  SECTION 1.03

  	
  Rules of Construction

  	
   

  	
  38

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE TWO THE NOTES

  	
   

  	
  39

  
	
   

  	
  SECTION 2.01

  	
  Form and Dating

  	
   

  	
  39

  
	
   

  	
  SECTION 2.02

  	
  Execution and Authentication; Aggregate Principal Amount

  	
   

  	
  40

  
	
   

  	
  SECTION 2.03

  	
  Registrar and Paying Agent

  	
   

  	
  42

  
	
   

  	
  SECTION 2.04

  	
  Obligations of Paying Agent

  	
   

  	
  42

  
	
   

  	
  SECTION 2.05

  	
  Holder Lists

  	
   

  	
  43

  
	
   

  	
  SECTION 2.06

  	
  Transfer and Exchange

  	
   

  	
  43

  
	
   

  	
  SECTION 2.07

  	
  Replacement Notes

  	
   

  	
  44

  
	
   

  	
  SECTION 2.08

  	
  Outstanding Notes

  	
   

  	
  44

  
	
   

  	
  SECTION 2.09

  	
  Treasury Notes; When Notes Are Disregarded

  	
   

  	
  44

  
	
   

  	
  SECTION 2.10

  	
  Temporary Notes

  	
   

  	
  45

  
	
   

  	
  SECTION 2.11

  	
  Cancellation

  	
   

  	
  45

  
	
   

  	
  SECTION 2.12

  	
  CUSIP Numbers

  	
   

  	
  45

  
	
   

  	
  SECTION 2.13

  	
  Deposit of Moneys

  	
   

  	
  46

  
	
   

  	
  SECTION 2.14

  	
  Book-Entry Provisions for Global Notes

  	
   

  	
  46

  
	
   

  	
  SECTION 2.15

  	
  Special Transfer Provisions

  	
   

  	
  47

  
	
   

  	
  SECTION 2.16

  	
  Transfers of Global Notes and Physical Notes

  	
   

  	
  51

  
	
   

  	
  SECTION 2.17

  	
  Defaulted Interest

  	
   

  	
  52

  
	
   

  	
  SECTION 2.18

  	
  Computation of Interest

  	
   

  	
  52

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE THREE REDEMPTION

  	
   

  	
  52

  
	
   

  	
  SECTION 3.01

  	
  Optional Redemption

  	
   

  	
  52

  
	
   

  	
  SECTION 3.02

  	
  No Mandatory Redemption

  	
   

  	
  53

  
	
   

  	
  SECTION 3.03

  	
  Selection of Notes to Be Redeemed

  	
   

  	
  53

  
	
   

  	
  SECTION 3.04

  	
  Notice of Redemption

  	
   

  	
  53

  
	
   

  	
  SECTION 3.05

  	
  Effect of Notice of Redemption

  	
   

  	
  55

  
	
   

  	
  SECTION 3.06

  	
  Deposit of Redemption Price

  	
   

  	
  55

  
	
   

  	
  SECTION 3.07

  	
  Notes Redeemed in Part

  	
   

  	
  55

  
	
   

  	
  SECTION 3.08

  	
  Company May Acquire Notes

  	
   

  	
  55

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE FOUR COVENANTS

  	
   

  	
  56

  
	
   

  	
  SECTION 4.01

  	
  Payment of Notes; Accrual of Interest

  	
   

  	
  56

  
	
   

  	
  SECTION 4.02

  	
  Maintenance of Registrar and Paying Agent

  	
   

  	
  57

  
	
   

  	
  SECTION 4.03

  	
  Corporate Existence

  	
   

  	
  58

  
	
   

  	
  SECTION 4.04

  	
  Payment of Taxes and Other Claims

  	
   

  	
  58

  
	
   

  	
  SECTION 4.05

  	
  Maintenance of Properties and Insurance

  	
   

  	
  58

  
	
   

  	
  SECTION 4.06

  	
  Compliance Certificate; Notice of Default

  	
   

  	
  59

  
	
   

  	
  SECTION 4.07

  	
  Compliance with Laws

  	
   

  	
  59

  

 

i

 

	
   

  	
  SECTION 4.08

  	
  Reports to Holders

  	
   

  	
  60

  
	
   

  	
  SECTION 4.09

  	
  Waiver of Stay, Extension or Usury Laws

  	
   

  	
  61

  
	
   

  	
  SECTION 4.10

  	
  Limitation on Restricted Payments

  	
   

  	
  61

  
	
   

  	
  SECTION 4.11

  	
  Limitations on Transactions with Affiliates

  	
   

  	
  65

  
	
   

  	
  SECTION 4.12

  	
  Incurrence of Indebtedness and Issuance of Disqualified
  Stock, Preferred Stock and Incentive Interests

  	
   

  	
  66

  
	
   

  	
  SECTION 4.13

  	
  Limitation on Dividend and Other Payment Restrictions
  Affecting Restricted Subsidiaries

  	
   

  	
  71

  
	
   

  	
  SECTION 4.14

  	
  Additional Note Guarantees

  	
   

  	
  73

  
	
   

  	
  SECTION 4.15

  	
  Repurchase Upon Change of Control

  	
   

  	
  74

  
	
   

  	
  SECTION 4.16

  	
  Limitation on Asset Sales

  	
   

  	
  76

  
	
   

  	
  SECTION 4.17

  	
  Event of Loss

  	
   

  	
  78

  
	
   

  	
  SECTION 4.18

  	
  [Reserved]

  	
   

  	
  79

  
	
   

  	
  SECTION 4.19

  	
  Repurchase Offers

  	
   

  	
  79

  
	
   

  	
  SECTION 4.20

  	
  Limitation on Liens

  	
   

  	
  82

  
	
   

  	
  SECTION 4.21

  	
  Business Activities

  	
   

  	
  83

  
	
   

  	
  SECTION 4.22

  	
  Payments for Consent

  	
   

  	
  83

  
	
   

  	
  SECTION 4.23

  	
  Impairment of Security Interest

  	
   

  	
  83

  
	
   

  	
  SECTION 4.24

  	
  Designation of Restricted and Unrestricted Subsidiaries

  	
   

  	
  83

  
	
   

  	
  SECTION 4.25

  	
  Additional Interest

  	
   

  	
  84

  
	
   

  	
  SECTION 4.26

  	
  Limitation on Sale and Leaseback Transactions

  	
   

  	
  84

  
	
   

  	
  SECTION 4.27

  	
  Subordination of Intercompany Debt; No Amendments to
  Certain Agreements

  	
   

  	
  85

  
	
   

  	
  SECTION 4.28

  	
  After-Acquired Property

  	
   

  	
  85

  
	
   

  	
  SECTION 4.29

  	
  Further Assurances

  	
   

  	
  86

  
	
   

  	
  SECTION 4.30

  	
  Calculation of Original Issue Discount

  	
   

  	
  87

  
	
   

  	
  SECTION 4.31

  	
  Credit Rating for the Notes

  	
   

  	
  87

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE FIVE SUCCESSOR
  CORPORATION

  	
   

  	
  87

  
	
   

  	
  SECTION 5.01

  	
  Merger, Consolidation and Sale of Assets

  	
   

  	
  87

  
	
   

  	
  SECTION 5.02

  	
  Successor Person Substituted

  	
   

  	
  89

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE SIX DEFAULT AND REMEDIES

  	
   

  	
  89

  
	
   

  	
  SECTION 6.01

  	
  Events of Default

  	
   

  	
  89

  
	
   

  	
  SECTION 6.02

  	
  Acceleration

  	
   

  	
  92

  
	
   

  	
  SECTION 6.03

  	
  Other Remedies

  	
   

  	
  93

  
	
   

  	
  SECTION 6.04

  	
  Waiver of Past Defaults

  	
   

  	
  94

  
	
   

  	
  SECTION 6.05

  	
  Control by Majority

  	
   

  	
  94

  
	
   

  	
  SECTION 6.06

  	
  Limitation on Holders’ Rights to Pursue Remedies

  	
   

  	
  94

  
	
   

  	
  SECTION 6.07

  	
  Rights of Holders to Receive Payment

  	
   

  	
  95

  
	
   

  	
  SECTION 6.08

  	
  Collection Suit by Trustee or Collateral Agent

  	
   

  	
  95

  
	
   

  	
  SECTION 6.09

  	
  Trustee May File Proofs of Claim

  	
   

  	
  96

  
	
   

  	
  SECTION 6.10

  	
  Priorities

  	
   

  	
  96

  
	
   

  	
  SECTION 6.11

  	
  Undertaking for Costs

  	
   

  	
  97

  
	
   

  	
  SECTION 6.12

  	
  Restoration of Rights and Remedies

  	
   

  	
  97

  
	
   

  	
  SECTION 6.13

  	
  Rights and Remedies Cumulative

  	
   

  	
  97

  
	
   

  	
  SECTION 6.14

  	
  Delay or Omission not Waiver

  	
   

  	
  97

  

 

ii

 

	
  ARTICLE SEVEN TRUSTEE

  	
   

  	
  98

  
	
   

  	
  SECTION 7.01

  	
  Duties of Trustee

  	
   

  	
  98

  
	
   

  	
  SECTION 7.02

  	
  Rights of Trustee

  	
   

  	
  99

  
	
   

  	
  SECTION 7.03

  	
  Individual Rights of Trustee

  	
   

  	
  101

  
	
   

  	
  SECTION 7.04

  	
  Trustee’s Disclaimer

  	
   

  	
  101

  
	
   

  	
  SECTION 7.05

  	
  Notice of Default

  	
   

  	
  102

  
	
   

  	
  SECTION 7.06

  	
  Reports by Trustee to Holders

  	
   

  	
  102

  
	
   

  	
  SECTION 7.07

  	
  Compensation and Indemnity

  	
   

  	
  102

  
	
   

  	
  SECTION 7.08

  	
  Replacement of Trustee

  	
   

  	
  104

  
	
   

  	
  SECTION 7.09

  	
  Successor Trustee by Merger, Etc.

  	
   

  	
  105

  
	
   

  	
  SECTION 7.10

  	
  Eligibility; Disqualification

  	
   

  	
  105

  
	
   

  	
  SECTION 7.11

  	
  Preferential Collection of Claims Against Company

  	
   

  	
  106

  
	
   

  	
  SECTION 7.12

  	
  Trustee as Collateral Agent and Paying Agent

  	
   

  	
  106

  
	
   

  	
  SECTION 7.13

  	
  Co-Trustees, Co-Collateral Agent and Separate Trustees,
  Collateral Agent

  	
   

  	
  106

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE EIGHT SATISFACTION AND
  DISCHARGE OF INDENTURE

  	
   

  	
  107

  
	
   

  	
  SECTION 8.01

  	
  Legal Defeasance and Covenant Defeasance

  	
   

  	
  107

  
	
   

  	
  SECTION 8.02

  	
  Satisfaction and Discharge

  	
   

  	
  110

  
	
   

  	
  SECTION 8.03

  	
  Survival of Certain Obligations

  	
   

  	
  111

  
	
   

  	
  SECTION 8.04

  	
  Acknowledgment of Discharge by Trustee

  	
   

  	
  111

  
	
   

  	
  SECTION 8.05

  	
  Application of Trust Moneys

  	
   

  	
  112

  
	
   

  	
  SECTION 8.06

  	
  Repayment to the Company of Unclaimed Money

  	
   

  	
  112

  
	
   

  	
  SECTION 8.07

  	
  Reinstatement

  	
   

  	
  112

  
	
   

  	
  SECTION 8.08

  	
  Indemnity for Government Obligations

  	
   

  	
  113

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE NINE AMENDMENTS, SUPPLEMENTS
  AND WAIVERS

  	
   

  	
  113

  
	
   

  	
  SECTION 9.01

  	
  Without Consent of Holders

  	
   

  	
  113

  
	
   

  	
  SECTION 9.02

  	
  With Consent of Holders

  	
   

  	
  114

  
	
   

  	
  SECTION 9.03

  	
  Compliance with TIA

  	
   

  	
  116

  
	
   

  	
  SECTION 9.04

  	
  Revocation and Effect of Consents

  	
   

  	
  116

  
	
   

  	
  SECTION 9.05

  	
  Notation on or Exchange of Notes

  	
   

  	
  116

  
	
   

  	
  SECTION 9.06

  	
  Trustee or Collateral Agent to Sign Amendments, Etc.

  	
   

  	
  117

  
	
   

  	
  SECTION 9.07

  	
  Acts of Holders

  	
   

  	
  117

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE TEN GUARANTEE

  	
   

  	
  118

  
	
   

  	
  SECTION 10.01

  	
  Guarantee

  	
   

  	
  118

  
	
   

  	
  SECTION 10.02

  	
  Release of a Guarantor

  	
   

  	
  119

  
	
   

  	
  SECTION 10.03

  	
  Limitation of Guarantor’s Liability

  	
   

  	
  120

  
	
   

  	
  SECTION 10.04

  	
  Guarantors May Consolidate, etc., on Certain Terms

  	
   

  	
  120

  
	
   

  	
  SECTION 10.05

  	
  Contribution

  	
   

  	
  121

  
	
   

  	
  SECTION 10.06

  	
  Waiver of Subrogation

  	
   

  	
  121

  
	
   

  	
  SECTION 10.07

  	
  Waiver of Stay, Extension or Usury Laws

  	
   

  	
  121

  
	
   

  	
  SECTION 10.08

  	
  Note Guarantee Evidenced by Indenture; No Notation of Note
  Guarantee

  	
   

  	
  122

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE ELEVEN MISCELLANEOUS

  	
   

  	
  122

  
	
   

  	
  SECTION 11.01

  	
  Trust Indenture Act Controls

  	
   

  	
  122

  
	
   

  	
  SECTION 11.02

  	
  Notices

  	
   

  	
  123

  

 

iii

 

	
   

  	
  SECTION 11.03

  	
  Communications by Holders with Other Holders

  	
   

  	
  124

  
	
   

  	
  SECTION 11.04

  	
  Certificate and Opinion as to Conditions Precedent

  	
   

  	
  124

  
	
   

  	
  SECTION 11.05

  	
  Statements Required in Certificate or Opinion

  	
   

  	
  125

  
	
   

  	
  SECTION 11.06

  	
  Rules by Trustee, Paying Agent, Registrar

  	
   

  	
  126

  
	
   

  	
  SECTION 11.07

  	
  Legal Holidays

  	
   

  	
  126

  
	
   

  	
  SECTION 11.08

  	
  Governing Law

  	
   

  	
  126

  
	
   

  	
  SECTION 11.09

  	
  No Adverse Interpretation of Other Agreements

  	
   

  	
  126

  
	
   

  	
  SECTION 11.10

  	
  No Recourse Against Others

  	
   

  	
  126

  
	
   

  	
  SECTION 11.11

  	
  Successors

  	
   

  	
  127

  
	
   

  	
  SECTION 11.12

  	
  Duplicate Originals

  	
   

  	
  127

  
	
   

  	
  SECTION 11.13

  	
  Severability

  	
   

  	
  127

  
	
   

  	
  SECTION 11.14

  	
  Waiver of Jury Trial

  	
   

  	
  127

  
	
   

  	
  SECTION 11.15

  	
  Table of Contents, Headings, etc.

  	
   

  	
  127

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE TWELVE SECURITY

  	
   

  	
  128

  
	
   

  	
  SECTION 12.01

  	
  Grant of Security Interest

  	
   

  	
  128

  
	
   

  	
  SECTION 12.02

  	
  Intercreditor Agreement

  	
   

  	
  133

  
	
   

  	
  SECTION 12.03

  	
  Recording and Opinions

  	
   

  	
  133

  
	
   

  	
  SECTION 12.04

  	
  Release of Note Collateral

  	
   

  	
  134

  
	
   

  	
  SECTION 12.05

  	
  Specified Releases of Note Collateral

  	
   

  	
  135

  
	
   

  	
  SECTION 12.06

  	
  Release of all Note Collateral

  	
   

  	
  136

  
	
   

  	
  SECTION 12.07

  	
  Matters as to Releases

  	
   

  	
  136

  
	
   

  	
  SECTION 12.08

  	
  Purchaser Protected

  	
   

  	
  137

  
	
   

  	
  SECTION 12.09

  	
  Authorization of Actions to Be Taken by the Collateral
  Agent Under the Collateral Documents

  	
   

  	
  137

  
	
   

  	
  SECTION 12.10

  	
  Authorization of Receipt of Funds by the Collateral Agent
  Under the Collateral Documents

  	
   

  	
  138

  
	
   

  	
  SECTION 12.11

  	
  Collateral Monies

  	
   

  	
  138

  
	
   

  	
  SECTION 12.12

  	
  Limitation on Certain Securities Collateral

  	
   

  	
  139

  

 

	
  Exhibit A

  	
  -

  	
  Form of
  Initial Note

  	
   

  	
  A-1

  
	
  Exhibit B

  	
  -

  	
  Form of
  Exchange Note

  	
   

  	
  B-1

  
	
  Exhibit C

  	
  -

  	
  Form of
  Legend for Global Notes

  	
   

  	
  C-1

  
	
  Exhibit D

  	
  -

  	
  Form of
  Private Placement Legend

  	
   

  	
  D-1

  
	
  Exhibit E

  	
  -

  	
  Form of
  Certificate to Be Delivered in Connection with Transfers to Non-QIB
  Accredited Investors

  	
   

  	
  E-1

  
	
  Exhibit F

  	
  -

  	
  Form of
  Certificate to Be Delivered in Connection with Transfers Pursuant to
  Regulation S

  	
   

  	
  F-1

  
	
  Exhibit G

  	
  -

  	
  Form of
  Supplemental Indenture

  	
   

  	
  G-1

  
	
  Exhibit H

  	
  -

  	
  Form of
  Mortgage

  	
   

  	
  H-1

  
	
  Exhibit I

  	
  -

  	
  Form of
  Certificate of Beneficial Ownership

  	
   

  	
  I-1

  

 

NOTE:                                                            This Table of
contents shall not, for any purpose, be deemed to be part of this Indenture.

 

iv

 

CROSS-REFERENCE TABLE

 

	
  TIA

  Section

  	
   

  	
  Indenture

  Section

  
	
  310(a)(1)

  	
   

  	
  7.10

  
	
  (a)(2)

  	
   

  	
  7.10

  
	
  (a)(3)

  	
   

  	
  N.A.

  
	
  (a)(4)

  	
   

  	
  N.A.

  
	
  (a)(5)

  	
   

  	
  7.10

  
	
  (b)

  	
   

  	
  7.03;
  7.08; 7.10

  
	
  (c)

  	
   

  	
  N.A.

  
	
  311(a)

  	
   

  	
  7.11

  
	
  (b)

  	
   

  	
  7.11

  
	
  (c)

  	
   

  	
  N.A.

  
	
  312(a)

  	
   

  	
  2.05

  
	
  (b)

  	
   

  	
  11.03

  
	
  (c)

  	
   

  	
  11.03

  
	
  313(a)

  	
   

  	
  7.06

  
	
  (b)(1)

  	
   

  	
  7.06

  
	
  (b)(2)

  	
   

  	
  7.06

  
	
  (c)

  	
   

  	
  7.06

  
	
  (d)

  	
   

  	
  7.06

  
	
  314(a)

  	
   

  	
  4.06;
  4.08

  
	
  (b)

  	
   

  	
  12.03

  
	
  (c)(1)

  	
   

  	
  11.04

  
	
  (c)(2)

  	
   

  	
  11.04

  
	
  (c)(3)

  	
   

  	
  N.A.

  
	
  (d)

  	
   

  	
  12.04

  
	
  (e)

  	
   

  	
  11.05

  
	
  (f)

  	
   

  	
  N.A.

  
	
  315(a)

  	
   

  	
  7.01(b)

  
	
  (b)

  	
   

  	
  7.05

  
	
  (c)

  	
   

  	
  7.01(a)

  
	
  (d)

  	
   

  	
  7.01(c)

  
	
  (e)

  	
   

  	
  6.11

  
	
  316(a) (last
  sentence)

  	
   

  	
  2.09

  
	
  (a)(1)(A)

  	
   

  	
  6.05

  
	
  (a)(1)(B)

  	
   

  	
  6.04

  
	
  (a)(2)

  	
   

  	
  N.A.

  
	
  (b)

  	
   

  	
  6.07

  
	
  (c)

  	
   

  	
  9.04

  
	
  317(a)(1)

  	
   

  	
  6.08

  
	
  (a)(2)

  	
   

  	
  6.09

  
	
  (b)

  	
   

  	
  2.04

  
	
  318(a)

  	
   

  	
  11.01

  
	
  (b)

  	
   

  	
  N.A.

  
	
  (c)

  	
   

  	
  11.01

  

 

v

 

N.A.
means Not Applicable

 

NOTE:                    This Cross-Reference Table
shall not, for any purpose, be deemed to be a part of this Indenture.

 

vi

 

INDENTURE, dated as of March 15, 2010, among Aventine
Renewable Energy Holdings, Inc., a Delaware corporation (the “Company”), the Guarantors (as herein defined) and
Wilmington Trust FSB, as trustee
(in such capacity, the “Trustee”) and
collateral agent (in such capacity, the “Collateral
Agent”).

 

W I T N E S S E T H:

 

WHEREAS, the Company has duly authorized the
creation of an issue of 13% Senior Secured Notes due 2015
(referred to herein as the “Notes”) and the
Guarantors have duly authorized the creation of the Note Guarantees (as herein
defined) and, to provide therefor, the Company and the Guarantors have duly
authorized the execution and delivery of this Indenture; and

 

WHEREAS, all things necessary to make the
Notes and Note Guarantees, when the Notes are duly issued and executed by the
Company and authenticated and delivered hereunder, the valid obligations of
each of the Company and the Guarantors, respectively, and to make this
Indenture a valid and binding agreement of each of the Company and the
Guarantors, have been done.

 

NOW, THEREFORE, each party hereto agrees as
follows for the benefit of the other parties and for the equal and ratable
benefit of the Holders (as herein defined):

 

ARTICLE ONE

 

DEFINITIONS AND INCORPORATION BY REFERENCE

 

SECTION 1.01       Definitions.

 

“ABL Facility”
means the Revolving Credit and Security Agreement, dated as of March 15,  2010,
among the Company, the lenders party thereto, and PNC Bank, National Association, as administrative agent, as
amended, restated, modified, increased, renewed, refunded, replaced (whether
upon or after termination or otherwise) or refinanced (including by means of
sales of one or more series of notes, bonds or other debt securities and
related indentures or similar agreements) in whole or in part from time to
time, including any agreement increasing the amount of Indebtedness incurred
thereunder or available to be borrowed thereunder to the extent permitted under
clause (1) of the second paragraph of Section 4.12.

 

“ABL Facility Lien
Security Documents” means one or more security agreements, pledge
agreements, collateral assignments, or other grants or transfers for security
executed and delivered by the Company or any Guarantor creating a Lien upon
assets constituting Secondary Collateral owned or to be acquired by the Company
or such Guarantor in favor of any holder or holders of Credit Facility
Obligations under the ABL Facility, or any administrative agent, agent or
representative acting for any such holders, as security for any Credit Facility
Obligations under the ABL Facility.

 

1

 

“ABL Facility Trigger Date” means the
date on which the Company delivers written notice to the Trustee that clause
(1)(a) of the second paragraph of Section 4.12 will no
longer be available for incurrence of any additional Indebtedness under the ABL
Facility.

 

“Acceleration Notice”
has the meaning set forth in Section 6.02(a).

 

“Accredited Investor”
means an individual or institution that is an “accredited investor” as that
term is defined in Rule 501(a) under the Securities Act.

 

“Additional Assets”
means: (i) any property or assets (other than Indebtedness, Capital Stock,
Excluded General Intangibles and Excluded Trademark Applications and other than
any assets classified as current assets under GAAP) used or useful in a
Permitted Business; or (ii) the Capital Stock of a Person that becomes a
Wholly-Owned Restricted Subsidiary as a result of the acquisition of such
Capital Stock by the Company or a Guarantor; provided, however, that,
in the case of this clause (ii), such Wholly-Owned Restricted Subsidiary
is primarily engaged in a Permitted Business and becomes a Guarantor at or
prior to consummation of such acquisition.

 

“Additional Interest”
has, with respect to any Notes that are entitled to the benefits of a
Registration Rights Agreement, the meaning set forth in such Registration
Rights Agreement.

 

“Additional Notes”
means any Notes that are originally issued after the Issue Date from time to
time pursuant to clause (c) of the fourth paragraph of Section 2.02 and otherwise in accordance
with the terms of this Indenture and any PIK Notes issued on any Interest
Payment Date pursuant to the fourth paragraph of Section 2.02
in partial payment of the interest accrued on any Additional Notes that is due
and payable on such Interest Payment Date.

 

“Affiliate”
of any specified Person means any other Person directly or indirectly
controlling or controlled by or under direct or indirect common control with
such specified Person.  For purposes of
this definition, “control”, as used with respect to any Person, means the possession,
directly or indirectly, of the power to direct or cause the direction of the
management or policies of such Person, whether through the ownership of voting
securities, by agreement or otherwise. 
For purposes of this definition, the terms “controlling”, “controlled by”
and “under common control with” have correlative meanings.

 

“Affiliate
Transaction” has the meaning set forth in Section 4.11.

 

“After-Acquired Covered Property”
means any After-Acquired Property other than real property acquired or owned by
the Company or any Guarantor that, at the time the Company or such Guarantor
acquires or first owns such After-Acquired Property, automatically becomes Note
Collateral subject to valid and perfected first priority Note Liens (subject
only to Permitted Collateral Liens) already created pursuant to then existing
Collateral Documents.

 

“After-Acquired Property”
means, with respect to the Company or any Guarantor:

 

(1)           any property
acquired by the Company or such Guarantor upon a transfer (including upon an
Investment) from the Company or any other Guarantor of property that was
Primary Collateral of the Company or such other Guarantor immediately prior to
the transfer;

 

2

 

(2)           any Additional
Assets acquired by the Company or such Guarantor that (pursuant to Section 4.16,
4.17, 12.01(j) or 12.11(a)(v) or pursuant to clause
(2)(A)(i) or (3) of the definition of “Asset Sale” or clause
(3) of the definition of “Permitted Investments”) are to become Note
Collateral prior to or simultaneously with the acquisition thereof (or, if such
Additional Assets are acquired pursuant to clause (a) of the first
paragraph of Section 4.17, on or prior to the later of the date of
completion of rebuilding, repair or improvement of such property or acquisition
of replacement property referred to therein);

 

(3)           any property
acquired by the Company or such Guarantor upon a transfer (including upon an
Investment) from the Company or any other Guarantor of property that was
Secondary Collateral of the Company or such other Guarantor immediately prior
to the transfer;

 

(4)           any property or
assets (other than property or assets already constituting Note Collateral) on
which the Company or any Guarantor grants a Lien for the benefit of holders of
Credit Facility Obligations; or

 

(5)           any Specified Assets
or material other property that is acquired or otherwise owned by the Company
or such Guarantor on or after the date of this Indenture of a type that secures
the Note Obligations.

 

“After-Acquired Property Required Date”
means, with respect to any After-Acquired Property acquired or owned by the
Company or any Guarantor:

 

(i)            if
such After-Acquired Property constitutes After-Acquired Specified Property, the
date the Company or such Guarantor acquires or first owns such After-Acquired
Specified Property (or, if such After-Acquired Specified Property is acquired
pursuant to clause (a) of the first paragraph of Section 4.17,
the later of the date of completion of rebuilding, repair or improvement of
such property or acquisition of replacement property referred to therein);

 

(ii)           if
such After-Acquired Property constitutes property or assets specified in clause
(4) of the definition of “After-Acquired Property”, the date on which
the Lien referred to in such clause is granted for the benefit of holders of
Credit Facility Obligations; or

 

(iii)          otherwise,
the date 30 days after the Company or such Guarantor acquires or first owns
such After-Acquired Property.

 

“After-Acquired Specified Property”
means any After-Acquired Property constituting property or Additional Assets
specified in clause (1) or (2) of the definition of “After-Acquired
Property”.

 

“Agent”
means any Paying Agent, Registrar or co-Registrar.

 

“Agent Members”
has the meaning set forth in Section 2.14(a) and means, with
respect to the Depository, Euroclear or Clearstream, a Person who has an
account with the Depository,

 

3

 

Euroclear
or Clearstream, respectively (and, with respect to the Depository, shall
include Euroclear and Clearstream).

 

“AI
Global Notes” has the meaning set forth in Section 2.01.

 

“Applicable
Procedures” means, with respect to any transfer or exchange of or
for beneficial interests in any Global Note, the rules and procedures of
the Depository, Euroclear or Clearstream that apply to such transfer or
exchange.

 

“Asset
Sale” means:

 

(a)           the sale, lease, conveyance or other disposition of
(including by way of any merger or consolidation and including any loss,
destruction, damage, condemnation, confiscation, requisition, seizure,
forfeiture or taking of title to or use of) any assets of the Company or any
Restricted Subsidiary; provided that the sale, conveyance or other
disposition of all or substantially all of the assets of the Company and its
Restricted Subsidiaries taken as a whole will be governed by the provisions of Section 4.15
or Section 5.01 or Section 10.04 and not by the
provisions of Section 4.16; and

 

(b)           the issuance of Equity Interests in any of the Company’s
Restricted Subsidiaries (other than directors’ qualifying shares) or the sale
or other disposition of Equity Interests in any of its Restricted Subsidiaries.

 

Notwithstanding the preceding,
none of the following will be deemed to be an Asset Sale:

 

(1)           any
single transaction or series of related transactions that involves assets
(other than assets constituting Specified Collateral) having a Fair Market
Value of less than $5,000,000;

 

(2)           a
transfer of assets (A) between or among (i) solely the Company and/or
its Restricted Subsidiaries that are Guarantors so long as, to the extent such
transfer includes any Note Collateral, such transfer does not occur unless such
assets become Note Collateral of the transferee prior to or simultaneously with
such transfer and until and unless the provisions of Section 4.28
(to the extent applicable to such transfer) have otherwise been complied with
in respect of such Note Collateral or (ii) Restricted Subsidiaries that
are not Guarantors or (B) by any Restricted Subsidiary that is not a
Guarantor to the Company or a Guarantor;

 

(3)           an
issuance of Equity Interests by (A) a Restricted Subsidiary of the Company
that is a Guarantor solely to the Company or another Restricted Subsidiary that
is a Guarantor so long as such issuance does not occur unless such Equity
Interests become Note Collateral simultaneously with the issuance thereof and
until and unless the provisions of Section 4.28 (to the extent
applicable to such issuance) have otherwise been complied with in respect of
such Equity Interests or (B) a Restricted Subsidiary that is not a
Guarantor solely to the Company or to another Restricted Subsidiary of the
Company;

 

4

 

(4)           the
sale, disposition or lease of inventory, products, services or accounts
receivable (other than Specified Collateral) in the ordinary course of
business;

 

(5)           any
sale, abandonment or other disposition in the ordinary course of business of
intellectual property or other assets (other than Specified Collateral)
determined by the Company in its reasonable judgment to be damaged, worn-out,
surplus, obsolete, permanently retired or no longer useful or economically
practicable to maintain in the conduct of the business of the Company and its
Restricted Subsidiaries, taken as a whole;

 

(6)           the
sale or other disposition of cash or Cash Equivalents;

 

(7)           a
Restricted Payment of assets other than Specified Collateral that is not
prohibited by Section 4.10 or a Permitted Investment of assets
other than Specified Collateral;

 

(8)           the
grant in the ordinary course of business of any non-exclusive license or
sublicense of patents, trademarks, registrations therefor and other
intellectual property;

 

(9)           the
lease or sublease of other property or assets (other than Specified Collateral)
in the ordinary course of business not involving any purchase option which does
not materially interfere with the business of the Company and its Restricted
Subsidiaries, taken as a whole (subject, in the case of any Note Collateral, to
the Lien securing the Notes Obligations);

 

(10)         to
the extent allowable under Section 1031 of the Code (or comparable or
successor provision), any exchange of property (other than Specified
Collateral) for like property for use in any Permitted Business;

 

(11)         any
Lien (or foreclosure thereon) securing Indebtedness to the extent such Lien is
permitted by Section 4.20;

 

(12)         an
Event of Loss; and

 

(13)         any
release of intangible claims or rights in connection with the loss or
settlement of a bona fide lawsuit, dispute or other controversy.

 

“Attributable
Debt” in respect of a Sale and Leaseback Transaction means, at the
time of determination, the present value of the obligation of the lessee for
net rental payments during the remaining term of the lease included in such
Sale and Leaseback Transaction, including any period for which such lease has
been extended or may, at the option of the lessor, be extended.  Such present value shall be calculated using
a discount rate equal to the rate of interest implicit in such Sale and
Leaseback Transaction, determined in accordance with GAAP; provided, however,
that if such Sale and Leaseback Transaction results in a Capital Lease
Obligation, the amount of Indebtedness represented thereby will be determined
in accordance with the definition of “Capital Lease Obligation.”

 

5

 

“Aurora
Facility” means that certain unfinished ethanol production facility
of the Company located in Aurora, Nebraska.

 

“Aurora
West” means Aventine Renewable Energy — Aurora West, LLC, a Delaware
limited liability company.

 

“Aurora
West Kiewit Documents” means the Aurora West Kiewit Note and the
Aurora West Kiewit Mortgage.

 

“Aurora
West Kiewit Mortgage” means the first priority deed of trust granted
on the Issue Date by the Company to Kiewit to secure the Aurora West Kiewit
Note by Liens on the Aurora West Real Property, as the same may be amended,
modified, renewed, restated or replaced, in whole or in part, from time to time
in accordance with its terms and the terms hereof (including Section 4.27).

 

“Aurora
West Kiewit Note” means the note payable by Aurora West to Kiewit in
the original principal amount of $5,251,808, as the same may be amended,
restated or modified in accordance with its terms and the terms hereof
(including Section 4.27).

 

“Aurora
West Real Property” means the real property in Aurora, Nebraska
owned by the Company on the Issue Date and improvements and accessions to such
property or proceeds or distributions thereof.

 

“Authenticating
Agent” has the meaning set forth in Section 2.02.

 

“Authentication Order”
has the meaning set forth in Section 2.02.

 

“Backstop Purchasers”
means Brigade Capital Management LLC, Nomura Corporate Research &
Asset Management, Inc., Whitebox Advisors, Senator Investment Group LP,
and SEACOR Capital Corporation, each as investment manager, for and on behalf
of certain funds.

 

“Bankruptcy Code”
means the Bankruptcy Reform Act of 1978, as amended, and codified as 11 U.S.C.
§§101 et  seq.

 

“Beneficial
Owner” has the meaning assigned to such term in Rule 13d-3 and Rule 13d-5
under the Exchange Act, except that in calculating the beneficial ownership of
any particular “person” (as that term is used in Section 13(d)(3) of
the Exchange Act), such “person” will be deemed to have beneficial ownership of
all securities that such “person” has the right to acquire by conversion or
exercise of other securities, whether such right is currently exercisable or is
exercisable only after the passage of time or only upon the occurrence of a
subsequent condition.

 

“Board
of Directors” means:

 

(1)           with
respect to a corporation, the board of directors of the corporation or any
committee thereof duly authorized to act on behalf of such board;

 

(2)           with
respect to a partnership, the board of directors or other governing body of the
general partner of the partnership;

 

6

 

(3)           with
respect to a limited liability company, the board of directors or other
governing body, and in the absence of same, the manager or board of managers or
the managing member or members or any controlling committee of managing members
thereof; and

 

(4)           with
respect to any other Person, the board or committee of such Person or other
individual or entity serving a similar function.

 

“Board Resolution”
means a copy of a resolution certified by the Secretary or an Assistant
Secretary of the applicable Person to have been duly adopted by the Board of
Directors of such Person and to be in full force and effect on the date of such
certification, and delivered to the Trustee. 
Unless otherwise specified herein, each reference to a Board Resolution
will refer to a Board Resolution of the Company.

 

“Business
Day” means a day that is not a Legal Holiday.

 

“Calculation Date”
means any date on which an event occurs that requires the calculation of the
Fixed Charge Coverage Ratio.

 

“Capital
Lease Obligation” means, with respect to any Person, any obligation
of such Person under a lease that is required to be capitalized for financial
reporting purposes in accordance with GAAP; and the amount of Indebtedness
represented by such lease at the time any determination is to be made shall be
the amount of the liability in respect of such lease that would at that time be
required to be capitalized on a balance sheet 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 prepaid by the lessee without payment of a penalty.

 

“Capital
Stock” means:

 

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

 

(2)           in
the case of an association or business entity that is not a corporation, any
and all shares, interests, participations, rights or other equivalents (however
designated) similar to corporate stock;

 

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

 

(4)           any
other interest or participation that confers on a Person the right to receive a
share of the profits and losses of, or distributions of assets of, the issuing
Person.

 

“Cash
Equivalents” means:

 

(1)           cash
in the form of United States of America dollars received in the ordinary course
of business;

 

7

 

(2)           securities
issued or directly and fully guaranteed or insured by the United States of
America or any agency or instrumentality thereof (provided that the full faith
and credit of the United States of America is pledged in support thereof)
having maturities of not more than one year from the date of acquisition;

 

(3)           dollar
denominated time deposits, overnight deposits, demand deposits and certificates
of deposit of any commercial bank having, or which is the principal banking
subsidiary of a bank holding company having, a long-term unsecured debt rating
of at least “A” or the equivalent thereof from S&P or “A2” or the
equivalent thereof from Moody’s with maturities of not more than one year from
the date of acquisition;

 

(4)           dollar
denominated time deposits, overnight deposits, demand deposits and certificates
of deposit of any bank not meeting the qualifications specified in clause (3) above
with maturities of not more than one year from the date of acquisition; provided,
that the aggregate amount of such deposits with such banks and outstanding at
any time shall not exceed $100,000;

 

(5)           repurchase
obligations for underlying securities of the types described in clause (2) above
entered into with any bank meeting the qualifications specified in clause (3) above;

 

(6)           commercial
paper issued by any Person incorporated in the United States of America, any
state thereof or the District of Columbia rated at least A-1 or the equivalent
thereof by S&P or at least P-1 or the equivalent thereof by Moody’s and in
each case maturing not more than one year after the date of acquisition;

 

(7)           marketable
direct obligations issued by the District of Columbia or any state of the
United States of America or any political subdivision of any such state or any
public instrumentality thereof maturing within one year from the date of
acquisition and, at the time of acquisition, having one of the two highest
ratings obtainable from either S&P or Moody’s;

 

(8)           Investments
in money market funds substantially all of whose assets are comprised of Cash
Equivalents of the types described in clauses (2) through (7) above;
and

 

(9)           in
the case of Investments by Foreign Subsidiaries, other short-term investments
in accordance with normal investment practices for cash management of a type
analogous to the foregoing.

 

“Change
of Control” means the occurrence of any of the following:

 

(1)           any
Person or Persons acting together that would constitute a group (for purposes
of Section 13(d) of the Exchange Act, or any successor provision
thereto) (a “group”), together with any Affiliates or related Persons thereof,
other than any such Person, Persons, Affiliates or related Person who are
Permitted Holders, is or becomes the “Beneficial Owner,” directly or
indirectly, of at least 35% of the voting power of the Company’s outstanding
Voting Stock, and the Permitted Holders own less than such 

 

8

 

Person or group (in performing the “own less than” comparison, the
holdings of the Permitted Holders who are members of the new group shall not be
counted in the shares held in the aggregate by Permitted Holders);

 

(2)           any
sale, lease or other transfer (other than by way of merger or consolidation),
in one transaction or a series of related transactions, is made by the Company
or any of its Restricted Subsidiaries of all or substantially all of the
consolidated assets of the Company and the Restricted Subsidiaries, taken as a
whole, to any Person;

 

(3)           the
Company consolidates with or merges with or into another Person or any Person
consolidates with, or merges with or into, the Company, in any such event
pursuant to a transaction in which immediately after the consummation thereof
Persons owning a majority of the Company’s Voting Stock voting immediately
prior to such consummation shall cease to own a majority of the Company’s
Voting Stock or, if the Company is not the surviving entity, a majority of the
Voting Stock of such surviving entity;

 

(4)           Continuing
Directors cease to constitute at least a majority of the Board of Directors of
the Company; or

 

(5)           the
Company’s stockholders approve any plan or proposal for the Company’s
liquidation or dissolution;

 

provided, however,
that in no event shall the sale of the Company’s common stock to an underwriter
or group of underwriters in privity of contract with the Company (or any other
Person in privity of contract with such underwriters) be deemed to be a Change
of Control unless such common stock is held in an investment account, in which
case the investment account would be treated without giving effect to the
foregoing part of this proviso.

 

“Change
of Control Offer” has the meaning set forth in Section 4.15(a).

 

“Change
of Control Payment Date” has the meaning set forth in Section 4.15(b)(2).

 

“Clearstream” means
Clearstream Banking, société anonyme, and any successor thereto.

 

“Collateral Account”
means an account of the Company established at  Wilmington Trust FSB  and pledged
as Primary Collateral to the Collateral Agent for the benefit of the Trustee
and the Holders and into which, among other things, (i) the Net Proceeds
corresponding to the Primary Collateral sold in a Primary Collateral Asset
Sale, (ii) the Net Loss Proceeds from an Event of Loss or (iii) the
net proceeds from an issuance of Additional Notes are deposited in accordance
with the provisions of Sections 4.16, 4.17 or 12.01(j),
respectively.

 

“Collateral
Agent” means the party named as such in this Indenture until a
successor replaces it in accordance with the provisions of this Indenture and
thereafter means such successor.

 

9

 

“Collateral
Documents” means, collectively, the Security Agreement, the
Intercreditor Agreement and each Mortgage, in each case, as the same may be in
force from time to time.

 

“Collateral Monies”
means all cash and Cash Equivalents received by the Collateral Agent:

 

(1)           as
Net Proceeds corresponding to the Primary Collateral sold in a Primary
Collateral Asset Sale in accordance with the provisions of Section 4.16;

 

(2)           as
Net Loss Proceeds from an Event of Loss in accordance with the provisions of Section 4.17;

 

(3)           pursuant
to the Collateral Documents;

 

(4)           as
proceeds of any sale or other disposition of all or any part of the Primary
Collateral by or on behalf of the Collateral Agent or any collection, recovery,
receipt, appropriation or other realization of or from all or any part of the
Primary Collateral pursuant to this Indenture or any of the Collateral
Documents or otherwise;

 

(5)           as
net proceeds from the issuance of any Additional Notes in accordance with the
provisions of Section 12.01(j); or

 

(6)           other
than pursuant to clauses (1), (2), (3), (4) or (5) above, for
application as provided in the relevant provisions of this Indenture or any
Collateral Document.

 

“Company” means the party named as such in this
Indenture until a successor replaces it pursuant to Section 5.02
and thereafter means such successor.

 

“Confirmation Order”
means that certain order confirming the Plan pursuant to Section 1129 of
the Bankruptcy Code entered by the United States Bankruptcy Court for the
District of Delaware on February 24, 2010.

 

“Consolidated
Cash Flow” means, with respect to any specified Person for any
period, the Consolidated Net Income of such Person for such period plus the sum
of, without duplication:

 

(1)           an
amount equal to any extraordinary loss plus any net loss realized by such
Person or any of its Restricted Subsidiaries in connection with an Asset Sale,
if, and only to the extent that, such losses were deducted in computing such
Consolidated Net Income; plus

 

(2)           an
amount equal to the provision for taxes based on income or profits of such
Person and its Restricted Subsidiaries for such period, if, and only to the
extent that, such provision for taxes was deducted in computing such
Consolidated Net Income; plus

 

(3)           an
amount equal to the Fixed Charges of such Person and its Restricted
Subsidiaries for such period, if, and only to the extent that, such Fixed
Charges were deducted in computing such Consolidated Net Income; plus

 

10

 

(4)           an
amount equal to depreciation and amortization (including amortization of
intangibles but excluding amortization of prepaid cash expenses that were paid
in a prior period) of such Person and its Restricted Subsidiaries for such
period, if, and only to the extent that, such depreciation and amortization
expenses were deducted in computing such Consolidated Net Income; plus

 

(5)           non-cash
items, if, and only to the extent that, such non-cash items were deducted in
computing such Consolidated Net Income, other than any non-cash charges that
represent accruals of, or reserves for, cash disbursements to be made in any
future accounting period;

 

in each case, on a
consolidated basis and determined in accordance with GAAP.

 

Notwithstanding the
preceding, the provision for taxes based on the income or profits of, and the
depreciation and amortization and other non-cash expenses of, a Restricted
Subsidiary of the Company that is not a Guarantor will be added to Consolidated
Net Income to compute Consolidated Cash Flow of the Company only to the extent
that a corresponding amount would be permitted at the date of determination to
be dividended to the Company or to a Guarantor by such Restricted Subsidiary
without prior governmental approval that has not been obtained, and without
direct or indirect restriction pursuant to the terms of its charter and all
agreements, instruments, judgments, decrees, orders, statutes, rules and
governmental regulations applicable to that Restricted Subsidiary or its
stockholders.

 

“Consolidated
Net Income” means, with respect to any specified Person for any
period, the aggregate of the Net Income of such Person and its Restricted
Subsidiaries for such period, on a consolidated basis, determined in accordance
with GAAP; provided that:

 

(1)           the
Net Income (but not loss) of any Person that is not a Restricted Subsidiary of
the specified Person or that is accounted for by the equity method of
accounting will be included only to the extent of the aggregate amount of
dividends or similar distributions paid in cash to the specified Person or a
Restricted Subsidiary of the specified Person;

 

(2)           the
Net Income of any Restricted Subsidiary of the Specified Person will be
excluded only to the extent that the declaration or payment of dividends or
similar distributions by that Restricted Subsidiary of that Net Income is not
at the date of determination permitted without any prior governmental approval
(that has not been obtained) or, directly or indirectly, by operation of the
terms of its charter or any agreement, instrument, judgment, decree, order,
statute, rule or governmental regulation applicable to that Restricted
Subsidiary or its stockholders or otherwise;

 

(3)           the
cumulative effect of a change in accounting principles will be excluded;

 

(4)           any
gain or loss, together with any related provision for taxes on such gain or
loss, realized in connection with (a) any sale of assets outside the
ordinary course of business of such Person or any of its Restricted Securities,
(b) the disposition of any 

 

11

 

securities by such Person or any of its Restricted Subsidiaries or (c) the
extinguishment of any Indebtedness of such Person or any of its Restricted
Subsidiaries shall be excluded;

 

(5)           any
extraordinary gain or loss, together with any related provision for taxes on
such extraordinary gain or loss, shall be excluded;

 

(6)           any
charges related to restructuring, debt retirement, extinguishment of Hedging
Obligations or facility closings shall be excluded;

 

(7)           all
non-cash expenses related to stock-based compensation plans or other non-cash
compensation, including stock option non-cash expenses, shall be excluded;

 

(8)           any
non-cash impact as a result of the Company’s adoption of fresh-start accounting
in accordance with GAAP upon effectiveness of the Plan shall be excluded; and

 

(9)           the
calculation of Consolidated Net Income will not give effect to, without
duplication, any deduction for (a) any increased amortization,
depreciation or cost of sales resulting from the write-up of assets pursuant to
Accounting Principles Board Opinion Nos. 16 and 17 or their respective
successors under the Financial Accounting Standards Board’s FASB Statement No. 168,
“The FASB Accounting Standards Codification,” and (b) any nonrecurring
charges relating to any premium or penalty paid, write-off of deferred
financing costs or other financial recapitalization charges in connection with
redeeming or retiring any Indebtedness prior to its Stated Maturity.

 

“Consolidated Net Worth”
means, with respect to any specified Person as of any date, the sum of:

 

(1)           the
consolidated equity of the common stockholders of such Person and its
consolidated Subsidiaries as of such date; plus

 

(2)           the
respective amounts reported on such Person’s balance sheet as of such date with
respect to any series of preferred stock (other than Disqualified Stock) that
by its terms is not entitled to the payment of dividends unless such dividends
may be declared and paid only out of net earnings in respect of the year of
such declaration and payment, but only to the extent of any cash received by
such Person upon issuance of such preferred stock.

 

“Continuing
Directors” means, as of any date of determination, any member of the
Board of Directors of the Company who:

 

(1)           was
a member of such Board of Directors on the Issue Date (following consummation
of the transactions contemplated by the Plan); or

 

(2)           was
elected to such Board of Directors with the approval of, or whose nomination
for election was approved or ratified by, a majority of the Continuing
Directors who were members of such Board of Directors at the time of such
nomination or election.

 

12

 

“Corporate
Trust Office” means the office of the Trustee specified in Section 11.02.

 

“Covenant
Defeasance” has the meaning set forth in  Section 8.01(c).

 

“Credit
Facilities” means one or more debt facilities (including the ABL
Facility) or commercial paper facilities, in each case with banks or other
institutional lenders, providing for revolving credit loans, term loans,
receivables financing (including through the sale of receivables to such
lenders or to special purpose entities formed to borrow from such lenders
against such receivables), bankers’ acceptances or letters of credit, including
any related notes, guarantees, collateral documents, instruments and agreements
executed and delivered in connection therewith, and, in each case, as amended,
restated, modified, increased, renewed, refunded, replaced (whether upon
termination or otherwise) or refinanced (including by means of sales of one or
more series of notes, bonds or other debt securities and related indentures or
similar agreements) in whole or in part from time to time; provided that
the aggregate principal amount of Indebtedness outstanding at any time under
all such Credit Facilities is permitted to be incurred at such time under clause (1) of the
second paragraph of Section 4.12.

 

“Credit
Facility Agent” means, at any time, the Person serving at such time
as the “Agent”, “Administrative Agent” or “Collateral Agent” under the
applicable Credit Facility or any other representative of the lenders
thereunder or any trustee or agent or representative of holders of Credit
Facility Obligations then most recently designated by the terms of the Credit
Facility, in a written notice delivered to the administrative agent, as the
Credit Facility Agent for the purposes of the Intercreditor Agreement.

 

“Credit Facility Amount”
means (i) at any time prior to the ABL Facility Trigger Date, $37,000,000;
or (ii) at any time on or after the ABL Facility Trigger Date, $60,000,000
less the aggregate principal amount of Indebtedness incurred pursuant to clause
(1)(a) of the second paragraph of Section 4.12 that is
outstanding at such time.

 

“Credit
Facility Lien” means, to the extent securing Credit Facility
Obligations, a Lien on assets constituting Secondary Collateral granted to the
Credit Facility Agent or any holder, or other administrative agent, agent,
trustee or representative of holders, of Credit Facility Obligations as
security for Credit Facility Obligations and subject to the Intercreditor
Agreement.

 

“Credit
Facility Lien Documents” means the documentation relating to the
Credit Facility Liens granted under any Credit Facility, including the ABL
Facility, the ABL Facility Lien Security Documents, any related loans,
guarantees, collateral documents, instruments and agreements executed in
connection therewith and all other agreements governing, securing or relating
to any Credit Facility Obligations.

 

“Credit
Facility Obligations” means Indebtedness arising under any Credit
Facility and all other Obligations of the Company or any Guarantor under the
Credit Facility Lien Documents.

 

“Custodian”
means any receiver, trustee, assignee, liquidator, sequestrator or similar
official under any Bankruptcy Code.

 

13

 

“Default”
means any event that is, or with the passage of time or the giving of notice or
both would be, an Event of Default.

 

“Depository”
means the DTC.

 

“Disqualified
Stock” means any Capital Stock that, by its terms (or by the terms
of any security into which it is convertible, or for which it is exchangeable,
in each case at the option of the holder of the Capital Stock) or upon the
happening of any event, (a) matures or is mandatorily redeemable pursuant
to a sinking fund obligation or otherwise or (b) is or may become
redeemable at the option of the holder of the Capital Stock, in whole or in
part, on or prior to the date that is 91 days after the Maturity Date.  Notwithstanding the preceding sentence, any
Capital Stock that would constitute Disqualified Stock solely because the
holders of the Capital Stock have the right to require the Company to
repurchase such Capital Stock upon the occurrence of a Change of Control or an
Asset Sale prior to the date that is 91 days after the Maturity Date will not
constitute Disqualified Stock if the change of control or asset sale provisions
applicable to such Capital Stock are no more favorable to the holders of such
Capital Stock than the provisions contained in Sections 4.15 and 4.16,
respectively, and provide that the Company may not repurchase or redeem any
such Capital Stock pursuant to such provisions unless such repurchase or
redemption complies with Section 4.10.  The amount of Disqualified Stock deemed to be
outstanding at any time for purposes of this Indenture will be the maximum
amount that the Company and its Restricted Subsidiaries may become obligated to
pay upon the maturity of, or pursuant to any mandatory redemption provisions
of, such Disqualified Stock, exclusive of accrued dividends.

 

“Domestic
Subsidiary” means any Restricted Subsidiary of the Company that
either (1) was formed under the laws of the United States of America or
any state of the United States of America or the District of Columbia or (2) does
not conduct substantially all its operations outside the United States of
America.

 

“DTC” means The
Depository Trust Company, its nominees and successors.

 

“Equity
Interests” means Capital Stock and all warrants, options or other
rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).

 

“Euroclear” means
Euroclear Bank S.A./N.V., as operator of the Euroclear system, and any
successor thereto.

 

“Event
of Default” has the meaning set forth in Section 6.01.

 

“Event
of Loss” means, with respect to any property or asset (tangible or
intangible, real or personal) that constitutes Primary Collateral (including
any of the Facilities), any of the following:

 

(1)           any
loss or destruction of, or damage to, such property or asset;

 

(2)           any
institution of any proceedings for the condemnation or seizure of, or for the
exercise of any right of eminent domain with respect to, such property or
asset;

 

14

 

(3)           any
actual condemnation, seizure or taking by exercise of the power of eminent
domain or otherwise of such property or asset, or confiscation of such property
or asset or the requisition of the use of such property or asset; or

 

(4)           any
settlement in lieu of clauses (2) or (3) above.

 

“Excess Asset Sale
Proceeds” has the meaning set forth in Section 4.16.

 

“Excess Loss Proceeds”
has the meaning set forth in Section 4.17.

 

“Excess Proceeds” has
the meaning set forth in Section 4.19.

 

“Exchange
Act” means the Securities Exchange Act of 1934, as amended, or any
successor statute or statutes thereto, and the rules and regulations of
the SEC promulgated thereunder.

 

“Exchange
Notes” means (i) the Notes, if any, issued under Section 2.02 pursuant to an Exchange Offer
and (ii) any PIK Notes issued on any Interest Payment Date pursuant to the
fourth paragraph of Section 2.02 in
partial payment of the interest accrued on any Exchange Notes that is due and
payable on such Interest Payment Date.

 

“Exchange
Offer” means an exchange offer that may be made by the Company,
pursuant to a Registration Rights Agreement, to exchange for any and all of the
Initial Notes or Additional Notes, respectively, a like aggregate principal
amount of Exchange Notes registered under the Securities Act and having
substantially identical terms to the Initial Notes or Additional Notes,
respectively.

 

“Excluded Foreign
Subsidiary Capital Stock” has the meaning set forth in the Security
Agreement.

 

“Excluded General
Intangibles” has the meaning set forth in the Security Agreement.

 

“Excluded Personal
Property” has the meaning set forth in the Security Agreement.

 

“Excluded Trademark
Applications” has the meaning set forth in the Security Agreement.

 

“Facilities”
means the Company’s ethanol production facilities and, in each case, all
improvements thereto.

 

“Fair
Market Value” means the price that would be paid in an arm’s-length
transaction between an informed and willing seller under no compulsion to sell
and an informed and unaffiliated willing buyer under no compulsion to buy in a
transaction not involving distress or necessity of either party.  “Fair Market Value” shall be determined,
except as otherwise provided in this Indenture, in good faith (a) by any
Officer, if Fair Market Value is equal to or less than $5.0 million or (b) by
the Board of Directors of the Company, whose determination shall be conclusive
if evidenced by a resolution of the Board of Directors, if Fair Market Value
exceeds $5.0 million.

 

15

 

“Fixed
Charge Coverage Ratio” means, with respect to any specified Person
for any period, the ratio of the Consolidated Cash Flow of such Person for such
period to the Fixed Charges of such Person for such period.  In the event that the specified Person or any
of its Restricted Subsidiaries incurs, assumes, Guarantees, repays,
repurchases, redeems, defeases or otherwise discharges any Indebtedness (other
than ordinary working capital borrowings) or issues, repurchases or redeems
preferred stock subsequent to the commencement of the period for which the
Fixed Charge Coverage Ratio is being calculated and on or prior to the
applicable Calculation Date, then the Fixed Charge Coverage Ratio will
be calculated giving pro forma effect to such incurrence, assumption,
Guarantee, repayment, repurchase, redemption, defeasance or other discharge of
Indebtedness, or such issuance, repurchase or redemption of such preferred
stock, and the use of the proceeds therefrom, as if the same had occurred on
the first day of the applicable period.

 

In addition, for purposes of
calculating the Fixed Charge Coverage Ratio for any period:

 

(1)           acquisitions
and dispositions of business entities or property and assets constituting a
division or line of business of any Person that have been made by the specified
Person or any of its Restricted Subsidiaries, including through mergers or
consolidations or as a result of a Permitted Investment and including any
related financing transactions and including increases in ownership of
Restricted Subsidiaries, during such period or subsequent to such period and on
or prior to the Calculation Date will be given pro forma effect as if they had
occurred on the first day of such period;

 

(2)           the
Consolidated Cash Flow of the specified Person and its Restricted Subsidiaries
attributable to discontinued operations, as determined in accordance with GAAP,
and operations or businesses (and ownership interests therein) disposed of
prior to the Calculation Date, will be excluded;

 

(3)           the
Fixed Charges of the specified Person and its Restricted Subsidiaries
attributable to discontinued operations, as determined in accordance with GAAP,
and operations or businesses (and ownership interests therein) disposed of
prior to the Calculation Date, will be excluded, but only to the extent that
the obligations giving rise to such Fixed Charges will not be obligations of
the specified Person or any of its Restricted Subsidiaries following the
Calculation Date;

 

(4)           any
Person that is a Restricted Subsidiary on the Calculation Date will be deemed
to have been a Restricted Subsidiary at all times during such period;

 

(5)           any
Person that is not a Restricted Subsidiary on the Calculation Date will be
deemed not to have been a Restricted Subsidiary at any time during such period;

 

(6)           if
any Indebtedness of the specified Person and its Restricted Subsidiaries bears
a floating rate of interest, the interest expense on such Indebtedness will be
calculated as if the rate in effect on the Calculation Date had been the
applicable rate for the entire period (taking into account any Hedging
Obligation applicable to such Indebtedness if such Hedging Obligation has a
remaining term until the earlier of the maturity of such Indebtedness or more
than 12 months after the Calculation Date; and

 

16

 

(7)           for
purposes of making the computations referred to above, interest on any
Indebtedness of the specified Person and its Restricted Subsidiaries under a
revolving credit facility (to the extent not excluded from the calculation of
the Fixed Charge Coverage Ratio due to the operation of the first parenthetical
phrase of this definition) computed on a pro forma basis shall be computed
based on the weighted average daily balance of such Indebtedness during such
period.

 

For purposes of this
definition and the first paragraph of Section 4.12,
whenever pro forma effect is to be given to any calculation, the pro forma
calculations shall be determined in good faith by the chief financial officer
of the Company.  Any such pro forma
calculations may include operating expense reductions (net of associated
expenses) for such period resulting from the acquisition which is being given
pro forma effect that (a) would be permitted to be reflected on pro forma
financial statements pursuant to Rule 11-02 of Regulation S-X under the
Securities Act or (b) have been realized or for which substantially all
the steps necessary for realization have been taken or, at the time of
determination, are reasonably expected to be taken with 90 days immediately
following any such acquisition, including the execution, termination,
renegotiation or modification of any contracts, the termination of any
personnel or the closing of any facility, as applicable, provided that, in any
case, such adjustments shall be (A) calculated on an annualized basis and (B) set
forth in an Officers’ Certificate signed by the Company’s chief financial
officer and another Officer which states in reasonable detail (i) the
amount of such adjustment or adjustments, (ii) that such adjustment or
adjustments are based on the reasonable good faith beliefs of the Officers
executing such Officers’ Certificate at the time of such execution and (iii) that
such adjustment or adjustments and the plan or plans related thereto have been
reviewed and approved by the Company’s Board of Directors.

 

“Fixed
Charges” means, with respect to any specified Person for any period,
the sum, without duplication, of:

 

(1)           the
consolidated interest expense of such Person and its Restricted Subsidiaries
for such period, whether paid or accrued, including amortization of debt
issuance costs and original issue discount, non-cash interest payments, the
interest component of any deferred payment obligations, the interest component
of all payments associated with Capital Lease Obligations, imputed interest
with respect to Attributable Debt, commissions, discounts and other fees and
charges incurred in respect of letter of credit or bankers’ acceptance
financings, and net of the effect of all payments made or received pursuant to
Hedging Obligations in respect of interest rates; plus

 

(2)           the
consolidated interest of such Person and its Restricted Subsidiaries that was
capitalized during such period to the extent the net income of such Restricted
Subsidiary is included in the calculation of Net Income; plus

 

(3)           any
interest accruing on Indebtedness of another Person that is Guaranteed by such
Person or one of its Restricted Subsidiaries or secured by a Lien on assets of
such Person or one of its Restricted Subsidiaries, whether or not such
Guarantee or Lien is called upon; plus

 

17

 

(4)           the
product of (a) all dividends, whether paid or accrued and whether or not
in cash, on any series of preferred stock of such Person or any of its
Restricted Subsidiaries, other than dividends on Equity Interests payable
solely in Equity Interests of the Company (other than Disqualified Stock) or to
the Company or a Restricted Subsidiary of the Company and (b) a fraction,
the numerator of which is one and the denominator of which is one minus the
then current combined federal, state and local statutory tax rate of such
Person, expressed as a decimal,

 

in each case, on a
consolidated basis and in accordance with GAAP.

 

“Foreign
Subsidiary” means any Restricted Subsidiary that is not a Domestic
Subsidiary.

 

“GAAP”
means generally accepted accounting principles set forth in the Financial
Accounting Standards Board’s FASB Statement No. 168, “The FASB Accounting
Standards Codification,” the opinions and pronouncements of the Accounting
Principles Board of the American Institute of Certified Public Accountants and
the statements and pronouncements of the Financial Accounting Standards Board,
or in such other statements by such other entity as have been approved by a
significant segment of the accounting profession which are in effect from time
to time.

 

“Global
Notes” has the meaning set forth in Section 2.01.

 

“Guarantee”
means, as to any Person, a guarantee other than by endorsement of negotiable instruments
for collection or deposit in the ordinary course of business, direct or
indirect, in any manner, including by way of a pledge of assets or through
letters of credit or reimbursement agreements in respect thereof, of all or any
part of any Indebtedness of another Person (whether arising by virtue of
partnership arrangements or by agreements to keep-well, to purchase assets,
goods, securities or services or to maintain such other Person’s financial
condition or otherwise).

 

“Guarantors”
means:

 

(1)           all
of the Company’s existing Restricted Subsidiaries that have executed and
delivered this Indenture as a guarantor; and

 

(2)           any
other Subsidiary of the Company that executes and delivers a supplemental
indenture hereto providing for a Note Guarantee in accordance with the
provisions of this Indenture;

 

and their respective
successors and assigns, in each case, until the Note Guarantee of such Person
has been released in accordance with the provisions of this Indenture.

 

“Hedging
Obligations” means, with respect to any specified Person, the
obligations of such Person under:

 

(1)           interest
rate swap agreements (whether from fixed to floating or from floating to
fixed), interest rate protection agreements, interest rate cap agreements,
interest rate collar agreements, interest rate hedge agreements and other
agreements 

 

18

 

(including any ISDA agreements) or arrangements designed to manage
interest rates or interest rate risk;

 

(2)           commodity
swap agreements, commodity option agreements, forward contracts and other
agreements (including any ISDA agreements) or arrangements designed to protect
such Person against fluctuations in commodity prices or the prices of other raw
materials used in its business; and

 

(3)           foreign
exchange contracts, currency swap agreements, futures contracts, currency
options, synthetic caps and other agreements (including any ISDA agreements) or
arrangements designed to protect such Person against fluctuations in currency
exchange rates.

 

“Holder”
means the Person in whose name a Note is registered on the Registrar’s books.

 

“Incentive Interests”
has the meaning set forth in Section 4.12.

 

“incur”
has the meaning set forth in Section 4.12.

 

“Indebtedness”
means, with respect to any specified Person, at any date of determination
(without duplication):

 

(1)           any
indebtedness of such Person (excluding accrued expenses and trade payables),
whether or not contingent:

 

(a)           in
respect of borrowed money;

 

(b)           evidenced
by bonds, loans, debentures or similar instruments or letters of credit (or
reimbursement agreements in respect thereof);

 

(c)           in
respect of bankers’ acceptances;

 

(d)           representing
Capital Lease Obligations; or

 

(e)           representing
any Hedging Obligations; and

 

(2)           all
Obligations of such Person issued or assumed as the deferred purchase price of
property, all conditional sale obligations and all Obligations under any title
retention agreement (but excluding (A) trade accounts payable and other
accrued liabilities arising in the ordinary course of business that are not
overdue by 90 days or more or are being contested in good faith by appropriate
proceedings promptly instituted and diligently conducted and (B) any
deferred purchase price represented by earn outs customary for like transactions),

 

if and to the extent any of
the preceding items (other than letters of credit, Attributable Debt and
Hedging Obligations) would appear as a liability upon a balance sheet of the
specified Person prepared in accordance with GAAP.  In addition, the term “Indebtedness” includes
(a) such portion of the Indebtedness of others secured by a Lien on any
asset of the specified Person 

 

19

 

(whether or not such
Indebtedness is assumed by the specified Person) as shall equal the lesser of (x) the
Fair Market Value of such asset as of the date of determination and (y) the
amount of such Indebtedness and (b) to the extent not otherwise included,
the Guarantee by the specified Person of any Indebtedness of any other Person.  Notwithstanding the foregoing, Indebtedness
of the Company or any Restricted Subsidiary shall not include the pledge by the
Company or such Restricted Subsidiary of, or a Guarantee thereof limited in
recourse to, the Capital Stock of an Unrestricted Subsidiary to secure
Non-Recourse Debt of such Unrestricted Subsidiary.

 

“Indemnified
Party” has the meaning set forth in Section 7.07.

 

“Indenture”
means this Indenture, as amended or supplemented from time to time in
accordance with the terms hereof.

 

“Indenture
Documents” means, collectively, this Indenture, the Notes and the
Collateral Documents.

 

“Indiana
Port Lease Agreement” means the Lease Agreement, dated as of October 31,
2006, between the Indiana Port Lessor and the Indiana Port Lessee, as amended
as of the Issue Date and as the same may be amended, restated, replaced,
supplemented or otherwise modified from time to time after the date hereof in
accordance with its terms and the terms hereof (including Section 4.27).

 

“Indiana Port Lease
Collateral” means any inventory, equipment or fixtures of the Indiana Port
Lessee that are (a) now or hereafter located on the Indiana Port Leased
Premises or (b) at any time used in connection with the business of the
Indiana Port Lessee carried out on the Indiana Port Leased Premises.

 

“Indiana
Port Leased Premises” means the real property leasehold interest
leased by the Indiana Port Lessee from the Indiana Port Lessor pursuant to the
Indiana Port Lease Agreement on which the Mt. Vernon Facility is located.

 

“Indiana
Port Lessee” means Aventine Renewable Energy — Mt Vernon, LLC, a
Delaware limited liability company.

 

“Indiana
Port Lessor” means the Indiana Port Commission, a body corporate and
politic existing under the laws of the State of Indiana, and its successors and
assigns.

 

“Initial
Notes” means (i) any Notes that are originally issued on the
Issue Date in the aggregate principal amount of up to $105,000,000 and (ii) any
PIK Notes issued on any Interest Payment Date pursuant to the fourth paragraph
of Section 2.02 in partial payment of the interest accrued on any
Initial Notes that is due and payable on such Interest Payment Date.

 

“Intercompany Debt”
means any Indebtedness owing by any of the Company or any of the Restricted
Subsidiaries of the Company to the Company or any of the Restricted
Subsidiaries of the Company.

 

“Intercreditor
Agreement” means the Intercreditor Agreement, dated the Issue Date,
among the Company, each of its Subsidiaries party thereto from time to time,
the Credit Facility 

 

20

 

Agent,
as First Lien Collateral Agent (as defined therein), and the Collateral Agent,
as Second Lien Collateral Agent (as defined therein), as the same may be
amended, restated, replaced, supplemented or otherwise modified from time to
time in accordance with its terms and the terms hereof.

 

“Interest
Payment Date” means the stated maturity of an installment of
interest on the Notes.

 

“Investments”
means, with respect to any Person, all direct or indirect investments by such
Person in other Persons (including Affiliates) in the forms of loans (including
Guarantees or other obligations), advances or capital contributions (excluding
commission, travel and similar advances to officers and employees made in the
ordinary course of business), and purchases or other acquisitions for
consideration of Indebtedness, Equity Interests or other securities of such
other Person together with all items that are or would be classified as
investments on a balance sheet prepared in accordance with GAAP.  If the Company or any Restricted Subsidiary
of the Company sells or otherwise disposes of any Equity Interests of any
direct or indirect Restricted Subsidiary of the Company such that, after giving
effect to any such sale or disposition, such Person is no longer a Restricted
Subsidiary of the Company, the Company or such Restricted Subsidiary will be
deemed to have made an Investment on the date of any such sale or disposition
equal to the Fair Market Value of the Company’s or the Restricted Subsidiary’s
Investments in such Restricted Subsidiary that were not sold or disposed of, if
any, in an amount determined as provided in the last paragraph of Section 4.10.  The acquisition by the Company or any
Restricted Subsidiary of the Company of a Person that holds an Investment in a
third Person will be deemed to be an Investment by the Company or such
Restricted Subsidiary in such third Person in an amount equal to the Fair
Market Value of the Investments held by the acquired Person in such third
Person in an amount determined as provided in the last paragraph of Section 4.10.  Except as otherwise provided in this
Indenture, the amount or Fair Market Value of an Investment will be determined
at the time the Investment is made and without giving effect to subsequent
changes in value.

 

“ISDA”
means the International Swaps and Derivatives Association or any successor
thereto.

 

“Issue
Date” means March 15, 2010.

 

“Issue Date Opinions”
means the Opinions of Counsel addressed and delivered to the Trustee and the
Collateral Agent substantially in the form of
the Opinions of Counsel delivered on the Issue Date to the Credit Facility
Agent and the Backstop Purchasers relating to (i) any of the Note
Collateral or the Collateral Documents, (ii) the due authorization,
execution and delivery of the Initial Notes, this Indenture, the Note
Guarantees and the Collateral Documents, and the validity and enforceability of
such documents, (iii) exemption of the offer and sale of the Initial Notes
and Note Guarantees to the Backstop Purchasers and any other subscribers from
registration under the Securities Act, and (iv) the absence of the need to
qualify this Indenture under the TIA in respect of such sale and offer.

 

“Kiewit” means Kiewit
Energy Company.

 

21

 

“Legal
Defeasance” has the meaning set forth in  Section 8.01(b).

 

“Legal
Holiday” has the meaning set forth in Section 11.07.

 

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

 

“Management Incentive
Plan” means the “Management Incentive Plan” as defined in the Plan, in the
form first adopted by the New Board (as defined in the Plan) on or after the
Issue Date in accordance with the Plan, as the same may be amended, modified,
renewed, restated or replaced, in whole or in part, from time to time in
accordance with its terms and the terms hereof (including Section 4.27).

 

“Maturity” means,
with respect to any Note, the date on which the principal of such Note becomes
due and payable as therein or herein provided, whether at the Maturity Date or
by declaration of acceleration, call for redemption or otherwise.

 

“Maturity
Date” means March 15, 2015.

 

“Moody’s”
means Moody’s Investors Service, Inc. and its successors.

 

“Mortgages”
means the mortgages, deeds of trust, deeds to secure Indebtedness or other
similar documents, if any, granting Liens on the Facilities or any other real
property owned by the Company or any Guarantor to secure the Note Obligations
as entered into on the Issue Date or thereafter in accordance with Section 12.01(g)(iv),
as such documents may be amended or supplemented from time to time in
accordance with their terms and the terms hereof.

 

“Mt.
Vernon Facility” means that certain unfinished ethanol production
facility of the Company located in Mt. Vernon, Indiana.

 

“Net
Income” means, with respect to any specified Person, the net income
(loss) of such Person, determined in accordance with GAAP and before any
reduction in respect of preferred stock dividends, excluding, however:

 

(1)           any
gain (but not loss), together with any related provision for taxes on such gain
(but not loss), realized in connection with: (a) any Asset Sale; or (b) the
disposition of any Equity Interests or other securities by such Person or any
of its Restricted Subsidiaries or the extinguishment of any Indebtedness of
such Person or any of its Restricted Subsidiaries;

 

(2)           any
extraordinary gain (but not loss), together with any related provision for
taxes on such extraordinary gain (but not loss); and

 

22

 

(3)           any
unrealized non-cash gains or losses in respect of Hedging Obligations, to the
extent such gains or losses are taken into account in computing the net income
(loss) of such Person.

 

“Net
Loss Proceeds” means the aggregate cash proceeds received by the Company
or any Guarantor in respect of any Event of Loss, including insurance proceeds,
condemnation awards or damages awarded by any judgment, net of (1) the
direct costs in recovery of such Net Loss Proceeds (including reasonable legal,
accounting, appraisal and insurance adjuster fees and any relocation expenses
incurred as a result thereof), (2) amounts required to be applied to the
repayment of Indebtedness, other than Credit Facility Obligations, secured by a
Lien on the asset or assets that were the subject of such Event of Loss, (3) any
taxes paid or payable as a result thereof and (4) amounts taken by the
Company or its Restricted Subsidiaries, as the case may be, as a reserve
against any liabilities associated with such Event of Loss and retained by the
Company or its Restricted Subsidiaries, as the case may be, after such Event of
Loss, including liabilities related to environmental matters and liabilities
under any indemnification obligations associated with such Event of Loss, all
as determined in accordance with GAAP.

 

“Net
Proceeds” means the aggregate cash proceeds received by the Company
or any of its Restricted Subsidiaries in respect of any Asset Sale (including
any cash received upon the sale or other disposition of any non-cash
consideration received in any Asset Sale), net of (1) the direct costs
relating to such Asset Sale, including legal, accounting and investment
banking, broker or finder fees, and sales commissions, and any relocation
expenses incurred as a result of the Asset Sale, (2) any taxes paid or
payable as a result of the Asset Sale, in each case, after taking into account
any available tax credits or deductions and any tax sharing arrangements, (3) amounts
required to be applied to the repayment of Indebtedness, other than Credit
Facility Obligations, secured by a Lien on the asset or assets that were the
subject of such Asset Sale, (4) any reserve for adjustment in respect of
the sale price of such asset or assets established in accordance with GAAP or
amount placed in an escrow account for purposes of such an adjustment and (5) escrowed
amounts and amounts taken by the Company or its Restricted Subsidiaries as a
reserve against liabilities associated with such Asset Sale, including pension
and other post-employment benefit liabilities, liabilities related to
environmental matters and liabilities under any indemnification obligations
associated with such Asset Sale, all as determined in accordance with GAAP; provided
that (a) excess amounts set aside for payment of taxes pursuant to clause
(2) above remaining after such taxes have been paid in full or the
statute of limitations therefor has expired and (b) amounts escrowed or
initially held in reserve pursuant to clause (5) no longer so held,
will, in the case of each of subclauses (a) and (b), at that
time become Net Proceeds.

 

“Non-Recourse
Debt” means Indebtedness:

 

(1)           as
to which neither the Company nor any of its Restricted Subsidiaries (a) provides
credit support of any kind (including any undertaking, agreement or instrument
that would constitute Indebtedness), (b) is directly or indirectly liable
(as a guarantor or otherwise) or (c) constitutes the lender;

 

(2)           no
default with respect to which would permit, upon notice, lapse of time or both,
any holder of any other Indebtedness of the Company or any of its Restricted

 

23

 

Subsidiaries
to declare a default on such other Indebtedness or cause the payment of such
other Indebtedness to be accelerated or payable prior to its Stated Maturity;
and

 

(3)           as to which (a) the
explicit terms provide that there is no recourse against any assets of the
Company or any of its Restricted Subsidiaries (other than Equity Interests of
Unrestricted Subsidiaries) or (b) the lenders have been notified in
writing that they will have no recourse to the stock or any assets of the
Company or any of its Restricted Subsidiaries (other than Equity Interests of
Unrestricted Subsidiaries).

 

“Non-U.S. Person” means a Person who
is not a “U.S. person,” as such term is defined in Regulation S.

 

“Note Collateral”
means, collectively, all the property and assets (including Primary Collateral
and Secondary Collateral) of the Company or any of the Guarantors that are from
time to time subject to the Lien of the Collateral Documents, including the
Liens, if any, required to be granted pursuant to this Indenture.

 

“Note Collateral Covered Property”
means any property or assets other than real property acquired or owned by the
Company or any Guarantor that, at the time the Company or such Guarantor
acquires or first owns such property or assets, automatically become Note
Collateral subject to valid and perfected first priority Note Liens (subject
only to Permitted Collateral Liens) already created pursuant to then existing
Collateral Documents.

 

“Note Collateral Non-Specified Covered
Property” means any Note Collateral Covered Property that is not
After-Acquired Specified Property.

 

“Note Collateral Required Date” means,
as to any additional property or assets required to be added to the Note
Collateral, (i) if such property or assets are After-Acquired Property,
the After-Acquired Property Required Date or (ii) otherwise, the date 30
days after the first date on which any provision of this Indenture or any
Collateral Document requires such additional property or assets so to be added
to the Note Collateral.

 

“Note Guarantee”
has the meaning set forth in Section 10.01.

 

“Note Lien”
means, to the extent securing Note Obligations, a Lien granted pursuant to a
Collateral Document as security for Note Obligations.

 

“Note Obligations”
means the Notes, the Note Guarantees and all other Obligations of any Obligor
under this Indenture, the Note Guarantees and the Collateral Documents.

 

“Notes” means the 13% Senior Secured
Notes due 2015 that are issued pursuant to this Indenture, as amended or
supplemented from time to time in accordance with the terms hereof, including
the Initial Notes, the Exchange Notes, any Additional Notes and any PIK Notes,
all treated as a single class.

 

“Obligations”
means all obligations for principal, premium, interest (including, with respect
to the Notes, any interest accruing after the commencement of any bankruptcy,
insolvency, or similar proceeding, whether or not a claim for post-filing or
post-petition interest 

 

24

 

is allowed in such
proceeding), penalties, fees, indemnifications, reimbursements, damages and
other liabilities payable under the documentation governing any Indebtedness.

 

“Obligors”
means, as the context may require, the Company or the Guarantors.

 

“Offer Trigger Date” has the meaning
set forth in Section 4.19.

 

“Offering”
means the offering of the Initial Notes that are originally issued on the Issue
Date in accordance with and pursuant to the Plan.

 

“Officer”
means the Chief Executive Officer, the President, the Chief Financial Officer,
the Chief Accounting and Compliance Officer, the Corporate Controller, any
Senior Vice President or any Vice President of the Company.

 

“Officers’
Certificate” means a certificate that (x) has been signed by (i) an
Officer of the Company that is either the principal accounting officer or the
principal financial officer of the Company and (ii) if delivered after the
Issue Date, another Officer of the Company and (y) meets the requirements
of Section 11.05 and is delivered to the Trustee.

 

“Opinion of Counsel”
means a written opinion of counsel who may be an employee of or counsel for the
Trustee or the Company and shall be reasonably acceptable to the Trustee and
that meets the requirements of Section 11.05.

 

“Paying Agent”
has the meaning set forth in Section 2.03.

 

“Payment Default” has the meaning set
forth in Section 6.01(f)(1).

 

“Permitted Business”
means (1) the business of the Company and its Subsidiaries engaged in on
the Issue Date and (2) any business or activity ancillary, reasonably
related or complementary thereto.

 

“Permitted Collateral Liens” means (1) with
respect to any Specified Collateral, Liens described in clauses (1), (4),
(5), (8), (9), (10), (11), (12), (13)
(solely to the extent (i) securing Permitted Refinancing Indebtedness incurred
in exchange for, or to refund, refinance, replace, defease or discharge,
Indebtedness that was secured by Liens permitted pursuant to clause (4) or
(5) of the definition of “Permitted Liens” and (ii) on the
same property (plus improvements and accessions to such property) on which such
other Liens were so permitted), (14), (16), (17), (20),
(21), (24) (solely to the extent of Specified Collateral
constituting a real property leasehold interest subject to Note Liens that are
permitted (or as to which consent has been granted) under the applicable lease)
and (27) of the definition of “Permitted Liens” or (2) with respect
to any Note Collateral (other than Specified Collateral), any Permitted Liens.

 

“Permitted Debt”
has the meaning set forth in Section 4.12.

 

“Permitted
Holders” means each of the Backstop Purchasers, its Affiliates and its and
its Affiliates’ managed funds and accounts and (1) entities controlled by
any such Persons, (2) trusts for the benefit of any such individual
Persons or the spouses, issue, parents or other relatives of such individual
Persons and (3) in the event of the death of any such individual Person,
heirs or 

 

25

 

testamentary
legatees of such Person.  For purposes of
this definition, “control”, as used with respect to any Person, shall mean the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of voting securities or by contract or otherwise.

 

“Permitted
Investments” means:

 

(1)           any Investment by (a) the
Company or a Restricted Subsidiary of the Company in the Company or a Guarantor
so long as, to the extent such Investment includes any assets constituting Note
Collateral of the Person making the Investment, such Investment does not occur
until and unless the provisions of Section 4.28 (to the extent
applicable to such Investment) have otherwise been complied with in respect of
such assets, (b) the Company or a Guarantor (of assets other than
Specified Collateral) in a Restricted Subsidiary of the Company that is not a
Guarantor to the extent that the aggregate amount of all such Investments does
not exceed $250,000  at
any time outstanding or (c) a Restricted Subsidiary of the Company that is
not a Guarantor in any other Restricted Subsidiary;

 

(2)           any Investment in
Cash Equivalents;

 

(3)           any Investment by
the Company or any Restricted Subsidiary of the Company in a Person, if as a
result of such Investment:

 

(a)           such Person becomes
a Restricted Subsidiary of the Company and a Guarantor; or

 

(b)           such Person is
merged, consolidated or amalgamated with or into, or transfers or conveys
substantially all of its assets to, or is liquidated into, the Company or a
Restricted Subsidiary of the Company that is a Guarantor;

 

so
long as, in the case of clause (a) or (b), to the extent as
a result of such Investment the Person making the Investment acquires or owns
any After-Acquired Property, such Investment does not occur unless such After-Acquired
Property has become Note Collateral prior to or simultaneously with the
acquisition thereof and until and unless the provisions of Section 4.28
(to the extent applicable to such Investment) have otherwise been complied with
respect to such After-Acquired Property;

 

(4)           any Investment made
as a result of the receipt of non-cash consideration from an Asset Sale that
was made pursuant to and in compliance with Section 4.16;

 

(5)           any acquisition of
assets or Capital Stock (including pursuant to any merger or consolidation of
the Company in accordance with Section 5.01) solely in exchange for
the issuance of Equity Interests (other than Disqualified Stock) of the
Company;

 

(6)           any Investments
received in compromise or resolution of (a) obligations of any Person or
customer that were incurred in the ordinary course of business of the 

 

26

 

Company
or any of its Restricted Subsidiaries, including pursuant to any plan of
reorganization or similar arrangement upon the bankruptcy or insolvency of such
Person; or (b) litigation, arbitration or other disputes with Persons who
are not Affiliates;

 

(7)           Investments
represented by deposits and margin deposits and other cash or Cash Equivalents
or other investment property deposited to secure performance of Hedging
Obligations (or to secure letters of credit securing Hedging Obligations); provided
that (a) such deposits are made in a manner within the general parameters
customary in the industry and incurred in the ordinary course of business and (b) such
Hedging Obligations are designed solely to protect the Company or any of its
Restricted Subsidiaries from fluctuations in interest rates, currencies or the
price of commodities;

 

(8)           other Investments
(of assets other than Specified Collateral) in any Person other than an
Affiliate of the Company having an aggregate Fair Market Value (measured on the
date each such Investment was made and without giving effect to subsequent
changes in value), when taken together with all other Investments made pursuant
to this clause (8) that are at the time outstanding, not to
exceed $1,000,000;

 

(9)           to the extent
permitted by applicable law, loans or advances to employees in the ordinary
course of business for bona fide business purposes and not to exceed $250,000
in the aggregate at any time outstanding;

 

(10)         Investments
constituting repurchases or acquisitions of the Notes;

 

(11)         Investments in
existence on the Issue Date;

 

(12)         Investments
represented by Guarantees that are otherwise permitted under this Indenture;

 

(13)         endorsements for
collection or deposit in the ordinary course of business by any Person of bank
drafts and similar negotiable instruments of any other Person received as
payment for ordinary course of business trade receivables;

 

(14)         cash or Cash
Equivalents or other investment property deposited in the ordinary course of
business to secure (or to secure letters of credit securing) the performance of
statutory obligations (including obligations under worker’s compensation,
unemployment insurance or similar legislation), surety or appeal bonds, leases,
agreements or other obligations under arrangements with utilities, insurance
agreements, construction agreements, performance bonds or other obligations of
a like nature incurred in the ordinary course of business, in each case if (but
only if) such obligations are not for borrowed money (“ordinary course deposits”);
provided that the aggregate amount of such Investments made pursuant to
this clause (14), when added to the aggregate outstanding amount of
Investments constituting ordinary course deposits in existence on the Issue
Date and permitted under clause (11) above, does not exceed $50,000,000
in the aggregate at any time outstanding;

 

(15)         receivables
(including pursuant to extensions of trade credit) and prepaid expenses, in
each case arising in the ordinary course of business; provided, however,
that 

 

27

 

such
receivables or prepaid expenses would be recorded as current assets of such
Person in accordance with GAAP; and

 

(16)         deposit of cash or
Cash Equivalents or other investment property constituting Secondary Collateral
to secure Credit Facility Obligations under the ABL Facility in an amount not
to exceed $5,000,000;

 

provided, however, that with respect to any Investment, the
Company may, in its sole discretion, allocate all or any portion of such
Investment to one or more of the above clauses (1) through
(16) so that all or a portion of such Investment would be a Permitted
Investment.

 

In connection with any assets or property
contributed or transferred to any Person as an Investment, such property and
assets shall be equal to the Fair Market Value at the time of Investment. The
amount of Investments outstanding at any time pursuant to clause (8) shall
be reduced by an amount equal to the net reduction in Investments by the
Company and its Restricted Subsidiaries, subsequent to the date of the
Indenture, resulting from repayments of loans or advances or other transfers of
assets, in each case, to the Company or any such Restricted Subsidiary from any
such Investment, or from the net cash proceeds from the sale of any such
Investment, or from a redesignation of an Unrestricted Subsidiary to a
Restricted Subsidiary, not to exceed, in the case of any Investment, the amount
of the Investment previously made by the Company or any of its Restricted
Subsidiaries in such Person or Unrestricted Subsidiary.

 

“Permitted Liens”
means:

 

(1)           Liens created for
the benefit of (or to secure) the Notes or the Note Guarantees;

 

(2)           Credit Facility
Liens on Secondary Collateral;

 

(3)           Liens in favor of
the Company or the Guarantors (not securing Credit Facility Obligations);

 

(4)           Liens on property of
a Person existing at the time such Person is merged with or into or
consolidated with the Company or any Restricted Subsidiary of the Company; provided
that such Liens were in existence prior to, and not incurred in contemplation
of, such merger or consolidation and do not extend to any property other than
that property of the Person merged into or consolidated with the Company or
such Restricted Subsidiary that were so subject to such Liens (plus
improvements and accessions to such property);

 

(5)           Liens on property
(including Capital Stock) existing at the time of acquisition of the property,
including by way of merger, consolidation or otherwise, by the Company or any
Restricted Subsidiary of the Company; provided that such Liens were in
existence prior to, and not incurred in contemplation of, such acquisition and
do not extend to any other property owned by the Company or any Restricted
Subsidiary (plus improvements and accessions to such property);

 

28

 

(6)           Liens on cash or
Cash Equivalents or other investment property deposited to secure (or to secure
letters of credit securing) the performance of statutory obligations (including
obligations under worker’s compensation, unemployment insurance or similar
legislation), surety or appeal bonds, leases, agreements or other obligations
under arrangements with utilities, insurance agreements, construction
agreements, performance bonds or other obligations of a like nature incurred in
the ordinary course of business, in each case if (but only if) such obligations
are not for borrowed money;

 

(7)           Liens existing on
the Issue Date (other than pursuant to the Aurora West Kiewit Mortgage or the
Indiana Port Lease Agreement or clause (2) or (3) of
this definition);

 

(8)           Liens granted on the
Issue Date on the Aurora West Real Property to secure the Aurora West Kiewit
Note pursuant to the Aurora West Kiewit Mortgage;

 

(9)           the Lien in favor of
the Indiana Port Lessor pursuant to the Indiana Port Lease Agreement on any
Indiana Port Lease Collateral securing the obligations of the Indiana Port
Lessee under the Indiana Port Lease Agreement if (but only if), (x) the
Indiana Port Leased Premises on which such Indiana Port Lease Collateral is
located is subject to a Mortgage securing the Note Obligations, (y) such
Indiana Port Lease Collateral constitutes Note Collateral and (z) such
Lien is subordinated to the Lien of the Collateral Documents (including such
Mortgage) in accordance with the terms of the Indiana Port Lease Agreement;

 

(10)         Liens for taxes,
assessments or governmental charges or claims that are not yet delinquent or
that are being contested in good faith by appropriate proceedings promptly
instituted and diligently concluded; provided that any reserve or other
appropriate provision as is required in conformity with GAAP has been made
therefor;

 

(11)         Liens imposed by law
(such as carriers’, warehousemen’s and mechanics’ Liens), Liens imposed by law
in favor of sellers of farm products and Liens of landlords imposed by law
securing obligations to pay lease amounts, in each case, that are not due and
payable or in default or that are being contested in good faith by appropriate
proceedings promptly instituted and diligently concluded, in each case,
incurred in the ordinary course of business;

 

(12)         survey exceptions,
encumbrances, restrictions, easements or reservations of, or rights of others
for, licenses, rights-of-way, sewers, electric lines, telegraph and telephone
lines and other similar purposes, or zoning or other restrictions as to the use
of real property that, in each case, were not incurred in connection with
Indebtedness and that do not in the aggregate materially adversely affect the
value of said properties or materially impair their use in the operation of the
business of such Person;

 

(13)         Liens to secure any
Permitted Refinancing Indebtedness permitted to be incurred under this
Indenture; provided, however, that:

 

(a)           the new Lien shall
be limited to all or part of the same property and assets that secured or,
under the written agreements pursuant to which the original 

 

29

 

Lien
arose, could secure the Indebtedness being exchanged, refunded, refinanced,
replaced, defeased or discharged (plus improvements and accessions to such
property or proceeds or distributions thereof); and

 

(b)           the Indebtedness
secured by the new Lien is not increased to any amount greater than the sum of (i) the
outstanding principal amount (or accreted value, if applicable) or, if greater,
the committed amount of the Indebtedness being exchanged, refunded, refinanced,
replaced, defeased or discharged and (ii) an amount necessary to pay all
accrued interest on such Indebtedness and any fees and expenses, including
premiums and tender and defeasance costs, related to such exchange, refunding,
refinancing, replacement, defeasance or discharge;

 

(14)         Liens arising
pursuant to an order of attachment, condemnation, eminent domain, distraint or
similar legal process arising in connection with legal proceedings and any
Liens that are required to protect or enforce rights in any administrative,
arbitration or other court proceedings in the ordinary course of business, in
each case, not giving rise to an Event of Default;

 

(15)         pledges of Equity
Interests of an Unrestricted Subsidiary securing Non-Recourse Debt of such
Unrestricted Subsidiary;

 

(16)         any Lien on property
(real or personal), plant or equipment, all or any part of the purchase price
or cost of design, development, construction, installation or improvement of
which was financed by Indebtedness permitted to be incurred pursuant to clause
(4) of the second paragraph of Section 4.12 solely to the
extent securing such Indebtedness;

 

(17)         leases or subleases granted to others that do not materially interfere
with the ordinary course of business of the Company and its Restricted
Subsidiaries, taken as a whole, so long as the aggregate Fair Market Value of
all Specified Collateral subject to such Liens pursuant to this clause (17)
does not exceed $500,000;

 

(18)         bankers’ Liens,
rights of setoff and similar Liens with respect to cash and Cash Equivalents on
deposit in one or more bank accounts in the ordinary course of business;

 

(19)         Liens securing reimbursement obligations with respect to letters of credit
that encumber documents and other property relating to such letters of credit
and the products and proceeds thereof,  so long
as the aggregate amount of obligations secured by Liens incurred pursuant to
this clause (19) does not exceed $1.0 million at any one time
outstanding;

 

(20)         Liens on goods imported by the Company or any Restricted Subsidiary in
favor of customs and revenue authorities arising as a matter of law to secure
payment of customs duties in connection with the importation of such goods;

 

(21)         Liens consisting of conditional sale, title retention, consignment or
similar arrangements for the sale of goods acquired by the Company or any of
its Restricted 

 

30

 

Subsidiaries in the ordinary course of business in
accordance with the past practices of the Company and its Restricted
Subsidiaries prior to the Issue Date so long as the aggregate Fair Market Value
of all Specified Collateral subject to such Liens pursuant to this clause
(21) does not exceed $500,000;

 

(22)         Liens securing insurance
premium financing arrangements, provided that such Lien is limited to
the applicable insurance contracts;

 

(23)         Liens arising from
filing Uniform Commercial Code financing statements regarding operating leases;

 

(24)         any interest or title
of a lessor, licensor or sublicensor in property leased, licensed or
sublicensed to the Company or any Restricted Subsidiary pursuant to any lease,
license or sublicense not constituting a Capital Lease Obligation or other
Indebtedness;

 

(25)         Liens encumbering deposits
and margin deposits and other Liens on cash or Cash Equivalents or other
investment property that are within the general parameters customary in the
industry and incurred in the ordinary course of business, in each case,
securing Hedging Obligations designed solely to protect the Company or any of
its Restricted Subsidiaries from fluctuations in interest rates, currencies or
the price of commodities;

 

(26)         Liens incurred in the
ordinary course of business of the Company or any Subsidiary of the Company
with respect to obligations that do not exceed $1,000,000 at any one time
outstanding; and

 

(27)         Liens incurred in the
ordinary course of business of the Company or any Subsidiary of the Company
with respect to obligations that do not secure Indebtedness and that do not
exceed $1,000,000 at any one time outstanding.

 

“Permitted
Refinancing Indebtedness” means any Indebtedness of the Company or
any of its Restricted Subsidiaries issued in exchange for, or the net proceeds
of which are used to refund, refinance, replace, defease or discharge, other
Indebtedness of the Company or any of its Restricted Subsidiaries (other than
Intercompany Debt); provided that:

 

(1)           the principal amount
(or accreted value, if applicable) of such Permitted Refinancing Indebtedness
does not exceed the principal amount (or accreted value, if applicable) of the
Indebtedness exchanged, refunded, refinanced, replaced, defeased or discharged
(plus all accrued interest on such Indebtedness and the amount of all fees and
expenses, including premiums and tender and defeasance costs, incurred in
connection therewith);

 

(2)           such Permitted
Refinancing Indebtedness has a final maturity date later than the final
maturity date of, and has a Weighted Average Life to Maturity equal to or
greater than the Weighted Average Life to Maturity of, the Indebtedness being
exchanged, refunded, refinanced, replaced, defeased or discharged (or, if
shorter, has a final maturity 

 

31

 

date
later than the final maturity date of, and has a Weighted Average Life to
Maturity equal to or greater than the Weighted Average Life to Maturity of, the
Notes);

 

(3)           if the Indebtedness
being exchanged, refunded, refinanced, replaced, defeased or discharged is
subordinated in right of payment to the Notes or any Note Guarantee, such
Permitted Refinancing Indebtedness has a final maturity date later than the
final maturity date of, and is subordinated in right of payment to, the Notes
or such Note Guarantee, as the case may be, on terms at least as favorable to
the Holders as those contained in the documentation governing the Indebtedness
being exchanged, refunded, refinanced, replaced, defeased or discharged; and

 

(4)           such Indebtedness
has the Company or any Restricted Subsidiary of the Company as an obligor
(whether as borrower, guarantor or otherwise) only if the Company or such
Restricted Subsidiary is an obligor (in any capacity) on the Indebtedness being
exchanged, refunded, refinanced, replaced, defeased or discharged.

 

“Person”
means any individual, corporation, partnership, joint venture, association,
joint-stock company, trust, unincorporated organization, limited liability
company or government or other entity.

 

“Physical Notes”
has the meaning set forth in Section 2.14(b).

 

“PIK Interest” means the portion of an installment of interest
due on an Interest Payment Date payable by issuance of PIK Notes as and to the
extent provided for in Section 4.01(d).

 

“PIK Interest Amount”
means, with respect to any Interest Payment Date for any Note that is prior to
the Maturity thereof and with respect to which the Company has duly made a PIK
Interest Election, the portion of the aggregate installment of interest due and
payable on such Interest Payment Date that is payable on such Interest Payment
Date by issuance of PIK Notes in accordance with the fourth paragraph of Section 2.02,
such portion being 7/15 of such aggregate installment of interest.

 

“PIK Interest Election” means, with respect to any Interest
Payment Date, an election by the Company duly given pursuant to Section 4.01(c) not
to pay the entire amount of interest due on the Notes on such Interest Payment
Date in cash.

 

“PIK
Notes” means Notes issued (including by any increase in the
principal amount of any outstanding Global Note previously authenticated
hereunder) on any Interest Payment Date pursuant to the fourth paragraph of Section 2.02
in payment of the portion of the aggregate installment of interest due and
payable on any Notes on such Interest Payment Date constituting the PIK
Interest Amount with respect to such Interest Payment Date for such Notes.

 

“Plan” means that certain Joint Plan
of Reorganization filed by the Company and its affiliates on December 4,
2009 in the United States Bankruptcy Court for the District of Delaware, as
amended or supplemented from time to time prior to entry of the Confirmation
Order, including any exhibits, supplements, annexes, appendices and schedules
thereto, as confirmed by such Bankruptcy Court pursuant to the Confirmation Order.

 

32

 

“Primary Collateral”
means the “Indenture Exclusive Collateral” as defined in the Intercreditor
Agreement.

 

“Primary
Collateral Asset Sale” means an Asset Sale consisting
of the disposition of assets constituting Primary Collateral (including the
disposition of Capital Stock of a Subsidiary which results in the disposition
of assets constituting Primary Collateral); provided that if an Asset
Sale results in the disposition of assets constituting Primary Collateral and
Secondary Collateral, the term “Primary
Collateral Asset Sale” shall be limited to the
portion of the Note Collateral so disposed of that constitutes Primary
Collateral.

 

“Primary Collateral Liens” means Note
Liens on Primary Collateral.

 

“principal”
of any Indebtedness (including the Notes) means the principal amount (or
accreted value, as the case may be) of such Indebtedness.

 

“Private Placement
Legend” means the legend initially set forth on the Notes in the
form set forth in Exhibit D.

 

“QIB”
means a “qualified institutional buyer” as defined in Rule 144A.

 

“Record Date”
means any of the record dates specified in the Notes, whether or not a Legal
Holiday.

 

“Redemption Date”
means, when used with respect to any Note to be redeemed, the date fixed for
redemption of such Note pursuant to this Indenture and the Notes.

 

“Redemption Price”
means, when used with respect to any Note to be redeemed, the price fixed for
redemption of such Note pursuant to this Indenture and the Notes.

 

“Register” has the meaning set forth
in Section 2.03.

 

“Registrar”
has the meaning set forth in Section 2.03.

 

“Registration Rights
Agreement” means (a) the Registration Rights Agreement, dated
as of the Issue Date, among the Company, the Guarantors and the Backstop Purchasers,
as the same may be amended or supplemented from time to time in accordance with
the terms thereof and (b) any registration rights agreement among the
Company, the Guarantors and the other parties thereto in connection with the
issuance of Additional Notes.

 

“Regulation S” means Regulation S
under the Securities Act.

 

“Regulation S Global Note” has the
meaning set forth in Section 2.01.

 

“Repurchase Offer” has the meaning set
forth in Section 4.19.

 

“Repurchase Offer Payment Date” has
the meaning set forth in Section 4.19.

 

“Restricted
Investment” means an Investment other than a Permitted Investment.

 

33

 

“Restricted Payments”
has the meaning set forth in Section 4.10.

 

“Restricted Period” means the 40-day
distribution compliance period as defined in Regulation S.

 

“Restricted Security”
has the meaning assigned to such term in Rule 144(a)(3) under the
Securities Act and shall include any Note bearing the Private Placement Legend;
provided that the Trustee shall be entitled
to request and conclusively rely on an Opinion of Counsel with respect to
whether any Note constitutes a Restricted Security.  Any Note issued (i) subject to Section 2.15(c),
upon the transfer, exchange or replacement of any Restricted Security and (ii) any
Note issued as a PIK Note in payment of interest due and payable on any
Restricted Security, shall, in each case, constitute a “Restricted Security”;
provided, however, that any Note issued upon the transfer, exchange or
replacement of any Restricted Security that no longer bears (or, pursuant to Section 2.15(c),
is no longer required to bear) a Private Placement Legend shall cease to (and
shall not) be a Restricted Security.

 

“Restricted
Subsidiary” of a Person means any Subsidiary of such Person that is
not an Unrestricted Subsidiary.

 

“Rule 144A”
means Rule 144A under the Securities Act.

 

“Rule 144A Global Notes” has the
meaning set forth in Section 2.01.

 

“S&P”
means Standard & Poor’s Ratings Group, a division of The McGraw-Hill
Companies, and its successors.

 

“Sale and Leaseback Transaction” means
a transaction whereby a Person sells or otherwise transfers assets or
properties and then or thereafter leases such assets or properties or any part
thereof or any other assets or properties which such Person intends to use for
substantially the same purpose or purposes as the assets or properties sold or
otherwise transferred.

 

“SEC”
means the Securities and Exchange Commission.

 

“Secondary
Collateral” means “Second Lien Collateral” as defined in the
Intercreditor Agreement.

 

“Secured Parties”
means, collectively, the Collateral Agent, the Trustee and the Holders.

 

“Securities Act”
means the Securities Act of 1933, as amended, or any successor statute or
statutes thereto, and the rules and regulations of the SEC promulgated
thereunder.

 

“Security Agreement”
means the Security Agreement, dated as of the Issue Date, made by the Company
and the Guarantors in favor of the Collateral Agent, as amended or supplemented
from time to time in accordance with its terms and the terms hereof.

 

34

 

“Significant
Subsidiary” means any Subsidiary that would be a “significant
subsidiary” as defined in Article 1, Rule 1-02 of Regulation S-X
under the Securities Act, as such Regulation is in effect on the Issue Date.

 

“Specified Assets” means any real
property (including any real property leasehold interest) or equipment.

 

“Specified Collateral” means any Note
Collateral comprising Specified Assets.

 

“Stated Maturity”
means (a) with respect to any series of Indebtedness, the date specified
in the documentation governing such Indebtedness as of the date such documentation
was entered into as the fixed date on which the final installment of principal
of such Indebtedness is due and payable and (b) with respect to any
scheduled installment of principal of or interest on any Indebtedness, the date
specified in the documentation governing such Indebtedness as of the date such
documentation was entered into as the fixed date on which such installment is
due and payable and, in each case, will not include any contingent obligations
to repay, redeem or repurchase any such installment of interest or principal
prior to the date originally scheduled for the payment thereof.

 

“Subordination
Agreement” means that certain Intercompany Subordination Agreement, dated the Issue Date, among the
Company, the Guarantors and the Collateral Agent, as amended or supplemented
from time to time, in accordance with its terms and the terms hereof (including
Section 4.27).

 

“Subsidiary”
means, with respect to any specified Person:

 

(1)           any
corporation, association or other business entity of which more than 50% of the
total voting power of shares of Capital Stock entitled (without regard to the
occurrence of any contingency and after giving effect to any voting agreement
or stockholders’ agreement that effectively transfers voting power) to vote in
the election of directors, managers or trustees of the corporation, association
or other business entity is at the time owned or controlled, directly or
indirectly, by that Person or one or more of the other Subsidiaries of that
Person (or a combination thereof); and

 

(2)           any partnership
(a) the sole general partner or the managing general partner of which is
such Person or a Subsidiary of such Person or (b) the only general
partners of which are such Person or one or more Subsidiaries of such Person
(or any combination thereof).

 

“TIA”
means the Trust Indenture Act of 1939 (15 U.S.C. §§ 77aaa-77bbbb), as amended,
as in effect on the Issue Date.

 

“Trust Officer”
means any officer of the Trustee assigned by the Trustee to administer this
Indenture or, in the case of a successor trustee, an officer assigned to the
department, division or group performing the corporation trust work of such
successor and assigned to administer this Indenture.

 

35

 

“Trustee”
means the party named as such in this Indenture until a successor replaces it
in accordance with the provisions of this Indenture and thereafter means such
successor.

 

“Unrestricted
Subsidiary” means any Subsidiary of the Company that is designated
by the Board of Directors of the Company as an Unrestricted Subsidiary pursuant
to a resolution of the Board of Directors, but only to the extent that such
Subsidiary:

 

(1)           has no
Indebtedness other than Non-Recourse Debt;

 

(2)           except as
permitted by Section 4.11, is not party to any agreement, contract,
arrangement or understanding with the Company or any Restricted Subsidiary of
the Company unless the terms of any such agreement, contract, arrangement or
understanding are no less favorable to the Company or such Restricted
Subsidiary than those that might be obtained at the time from Persons who are
not Affiliates of the Company;

 

(3)           is a Person
with respect to which neither the Company nor any of its Restricted
Subsidiaries has any direct or indirect obligation (a) to subscribe for
additional Equity Interests or (b) to maintain or preserve such Person’s
financial condition or to cause such Person to achieve specified levels of
operating results;

 

(4)           has not
guaranteed or otherwise directly or indirectly provided credit support for any
Indebtedness of the Company or any of its Restricted Subsidiaries;

 

(5)           does not own
any Capital Stock or Indebtedness of, or own or hold any Lien on any asset or
property of, the Company or any Restricted Subsidiary of the Company and does
not own any Note Collateral and has no Subsidiaries other than Unrestricted
Subsidiaries; and

 

(6)           would
constitute an Investment which the Company could make in compliance with Section 4.10.

 

Any designation of a Subsidiary of the
Company as an Unrestricted Subsidiary will be evidenced to the Trustee by
filing with the Trustee the Board Resolution giving effect to such designation
and an Officers’ Certificate certifying that such designation complied with the
preceding conditions and was permitted by Section 4.10.  If, at any time, any Unrestricted Subsidiary
would fail to meet the preceding requirements as an Unrestricted Subsidiary, it
will thereafter cease to be an Unrestricted Subsidiary for purposes of this
Indenture and any Indebtedness of such Subsidiary will be deemed to be incurred
by a Restricted Subsidiary of the Company as of such date and, if such
Indebtedness is not permitted to be incurred as of such date under Section 4.12, the Company will be in default
of such Section 4.12.  The Board of Directors of the Company may at
any time designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided
that such designation will be deemed to be an incurrence by a Restricted
Subsidiary of the Company of any outstanding Indebtedness of such Unrestricted
Subsidiary and such designation will only be permitted if (i) such
Indebtedness is permitted under Section 4.12,
calculated on a pro forma basis as if such designation had occurred at the
beginning of the four-quarter reference period and (ii) no Default or
Event of Default would be in existence following such designation.

 

36

 

“U.S. Government
Obligations” means non-callable direct obligations of, and
non-callable obligations guaranteed by, the United States of America for the
payment of which the full faith and credit of the United States of America is
pledged.

 

“U.S. Legal Tender”
means such coin or currency of the United States of America which, as at the
time of payment, shall be immediately available legal tender for the payment of
public and private debts.

 

“U.S. Person” means a “U.S. person,”
as such term is defined in Regulation S.

 

“Voting Stock”
of any Person as of any date means the Capital Stock of such Person that is at
the time entitled to vote in the election of the Board of Directors of such
Person.

 

“Weighted Average
Life to Maturity” means, when applied to any Indebtedness at any
date, the number of years obtained by dividing:

 

(1)           the sum of the
product obtained by multiplying (1) the amount of each then remaining
installment, sinking fund, serial maturity or other required payment of
principal, including payment at final maturity, in respect of the Indebtedness,
by (2) the number of years (calculated to the nearest one-twelfth) that
will elapse between such date and the making of such payment; by

 

(2)           the then
outstanding principal amount of such Indebtedness.

 

“Wholly-Owned
Restricted Subsidiary” of any specified Person means a Restricted
Subsidiary of such Person all of the outstanding Capital Stock or other
ownership interests of which (other than directors’ qualifying shares or shares
required by applicable law) will at the time be owned by such Person or by one
or more Wholly-Owned Restricted Subsidiaries of such Person or by such Person
and one or more Wholly-Owned Restricted Subsidiaries of such Person.

 

SECTION 1.02                                                                    Incorporation
by Reference of Trust Indenture Act.

 

Whenever this Indenture refers to a provision
of the TIA, such provision is incorporated by reference in, and made a part of,
this Indenture.  The following TIA terms
used in this Indenture have the following meanings:

 

“indenture
securities” means the Notes.

 

“indenture security
holder” means a Holder.

 

“indenture to be
qualified” means this Indenture.

 

“indenture trustee”
or “institutional trustee” means the Trustee.

 

“obligor”
on the indenture securities means the Company or any other obligor on the
Notes.

 

37

 

All other TIA terms used in this Indenture
that are defined by the TIA, defined by TIA reference to another statute or
defined by SEC rule and not otherwise defined herein have the meanings
assigned to them therein.

 

SECTION 1.03                                                                    Rules of
Construction.

 

Unless the context otherwise requires:

 

(a)           a term has the
meaning assigned to it;

 

(b)           an accounting
term not otherwise defined has the meaning assigned to it in accordance with
GAAP;

 

(c)           “or” is not
exclusive;

 

(d)           words in the
singular include the plural, and words in the plural include the singular;

 

(e)           “herein”, “hereof”
and other words of similar import refer to this Indenture as a whole and not to
any particular Article, Section or other subdivision;

 

(f)            when the words “includes”
or “including” are used herein, they shall be deemed to be followed by the
words “without limitation”;

 

(g)           all references
to “interest” in this Indenture in respect of any Note shall include any
Additional Interest due on such Note pursuant to the terms of the applicable
Registration Rights Agreement;

 

(h)           all references
to Sections or Articles refer to Sections or Articles of this Indenture unless
otherwise indicated;

 

(i)            solely for the
purposes of Section 4.12, all obligations with respect to
redemption, repayment or other repurchase of any Disqualified Stock of any Person
and the amount of the liquidation preference of any preferred stock of such
Person shall be deemed “Indebtedness” of such Person and the amount thereof
outstanding at any time shall be (a) in the case of Disqualified Stock, as
specified in the last sentence of the definition thereof or (b) in the
case of preferred stock, (1) the maximum liquidation value of such
preferred stock or (2) the maximum mandatory redemption or mandatory
repurchase price with respect to such preferred stock, whichever is greater;

 

(j)            provisions
apply to successive events and transactions; and

 

(k)           references to
sections of or rules under the Securities Act or the Exchange Act shall be
deemed to include substitute, replacement or successor sections or rules adopted
by the SEC from time to time.

 

38

 

ARTICLE TWO

 

THE NOTES

 

SECTION 2.01                                                                    Form and
Dating.

 

The Initial Notes and the Additional Notes
and the Trustee’s certificate of authentication thereon shall be substantially
in the form of Exhibit A hereto.  The Exchange Notes and the Trustee’s
certificate of authentication thereon shall be substantially in the form of Exhibit B hereto.  The Notes may have notations, legends or
endorsements required by law, stock exchange rule or Depository rule or
usage.  The Company shall approve the
form of the Notes and any notation, legend or endorsement on them.  Each Note shall be dated the date of its
authentication.

 

The terms and provisions contained in the
forms of the Notes annexed hereto as Exhibit A
and Exhibit B shall constitute, and
are hereby expressly made, a part of this Indenture and, to the extent
applicable, the Company, the Guarantors and the Trustee, by their execution and
delivery of this Indenture, expressly agree to such terms and provisions and to
be bound thereby.  However, to the extent
any provision of any Note conflicts with the express provisions of this
Indenture, the provisions of this Indenture shall govern and be controlling.

 

Notes offered and sold in reliance on Rule 144A
shall be issued initially in the form of one or more permanent global notes in
registered form, substantially in the form set forth in Exhibit A
hereto (the “Rule 144A Global Notes”),
deposited with the Trustee, as custodian for the Depository, duly executed by
the Company and authenticated by the Trustee as hereinafter provided and shall
bear the legend set forth in Exhibit C.

 

Notes offered and sold to Accredited
Investors in reliance on Rule 501(a) under the Securities Act shall
be issued initially in the form of one or more permanent global notes in
registered form, substantially in the form set forth in Exhibit A
(the “AI Global Notes”), deposited with the
Trustee, as custodian for the Depository, duly executed by the Company and
authenticated by the Trustee as hereinafter provided and shall bear the legend
set forth in Exhibit C.

 

Notes offered and sold in offshore
transactions in reliance on Regulation S shall be issued in the form of one or
more permanent global notes in registered form, substantially in the form set
forth in Exhibit A (a “Regulation S Global Note”) deposited
with the Trustee, as custodian for the Depository, and registered in the name
of the Depositary or the nominee of the Depositary for the accounts of
designated agents holding on behalf of Euroclear or Clearstream, duly executed
by the Company and authenticated by the Trustee as hereinafter provided and
shall bear the legend set forth in Exhibit C.

 

Additional Notes offered and sold pursuant to
an effective registration statement under the Securities Act shall be issued
initially in the form of Exchange Notes in registered global form, deposited
with the Trustee, as custodian for the Depository, duly executed by the Company
and authenticated by the Trustee as hereinafter provided.

 

The provisions of the “Operating Procedures
of the Euroclear System” and “Terms and Conditions Governing Use of Euroclear”
and the “General Terms and Conditions of Clearstream 

 

39

 

Banking” and “Customer
Handbook” of Clearstream will be applicable to transfers of beneficial
interests in the Regulation S Global Note that are held by participants through
Euroclear or Clearsteam.  Rule 144A
Global Notes, AI Global Notes, Regulation S Global Notes and Exchange
Notes issued in global form are referred to collectively as the “Global Notes.”

 

The aggregate principal amount of any Global
Note may from time to time be increased or decreased by adjustments made on the
records of the Registrar and simultaneous notation by the Trustee, as custodian
for the Depository, of such increase or decrease on the schedule to such Global
Note, all as hereinafter provided.

 

The definitive Notes shall be typed, printed,
lithographed or engraved or produced by any combination of these methods or may
be produced in any other manner permitted by the rules of any securities
exchange on which the Notes may be listed, all as determined by the Officers
executing such Notes, as evidenced by their execution of such Notes.

 

SECTION 2.02                                                                    Execution and
Authentication; Aggregate Principal Amount.

 

An Officer (who shall have been duly
authorized by all requisite corporate actions) shall sign the Notes for the
Company by manual or facsimile signature.

 

If an Officer whose signature is on a Note
was an Officer at the time of such execution but no longer holds that office or
position at the time the Trustee authenticates the Note, the Note shall
nevertheless be valid.

 

A Note shall not be valid until an authorized
signatory of the Trustee manually signs the certificate of authentication on
the Note.  The signature shall be
conclusive evidence, and the only evidence, that the Note has been
authenticated under this Indenture.

 

The Trustee shall authenticate (a) Initial
Notes for original issue in the aggregate principal amount not to exceed
$105,000,000, (b) Exchange Notes from time to time for issue only pursuant
to a Registration Rights Agreement in exchange for a like principal amount of
Initial Notes or Additional Notes, and (c) subject to compliance with Section 4.12, one or more series of
Additional Notes for original issue after the Issue Date in an aggregate
principal amount not to exceed $50,000,000, in each case upon a written order
of the Company in the form of an Officers’ Certificate (an “Authentication
Order”), which Authentication Order shall, in the case of any issuance of
Additional Notes, certify that such issuance is in compliance with Section 4.12 and whether such Additional
Notes are initially to be issued bearing the Private Placement Legend (and thus
initially be Restricted Securities).  In
addition, each such Authentication Order shall specify the amount of Notes to
be authenticated, the date on which the Notes are to be authenticated and
whether the Notes are to be Initial Notes, Exchange Notes or Additional
Notes.  Upon the Trustee’s receipt of an
Authentication Order for authentication of PIK Notes to be delivered to Holders
of the Notes on an Interest Payment Date prior to Maturity of such Notes in
satisfaction of the portion of the aggregate installment of interest due and
payable on such Notes on such Interest Payment Date constituting the PIK
Interest Amount with respect to such Interest Payment Date for such Notes, the
Trustee shall authenticate for original issue additional Notes constituting PIK
Notes (or increase the principal amount of any Global Notes previously
authenticated hereunder) in an aggregate principal amount equal to such PIK
Interest Amount 

 

40

 

with respect to such
Interest Payment Date for such Notes, all as specified in such Authentication
Order.  Each such Authentication Order
shall specify the respective amount of the additional Notes constituting PIK
Notes to be authenticated or principal amount of Global Notes previously
authenticated to be increased and the Interest Payment Date on which the
additional Notes constituting PIK Notes are to be authenticated or the
principal amount of Global Notes is to be increased.  On any Interest Payment Date on which the Company
pays PIK Interest on any Notes by increasing the principal amount of any Global
Note previously authenticated hereunder, the Trustee shall increase the
principal amount of such Global Note by an amount equal to the PIK Interest
Amount with respect to such Interest Payment Date for such Notes, rounded up to
the nearest $1.00, to the credit of the Holders of such Notes as of the
relevant Record Date for such Interest Payment Date, pro rata in accordance
with their interests, and an adjustment shall be made on the books and records
of the Registrar with respect to such Global Note by the Registrar to reflect
such increase.  On any Interest Payment
Date on which the Company pays PIK Interest on any Notes by issuing additional
Notes constituting PIK Notes, the Trustee shall deliver to the Holders of such
Notes as of the relevant Record Date for such Interest Payment Date additional
Notes constituting PIK Notes having an aggregate principal amount equal to the
PIK Interest Amount with respect to such Interest Payment Date for such Notes,
with the principal amount thereof rounded up to the nearest $1.00.

 

The
Company shall deliver to the Trustee an Authentication Order requesting the
Trustee to authenticate, and, upon receipt of such Authentication Order, the Trustee
shall authenticate, Notes upon exchange for other Notes in accordance with Sections
2.14(e), 2.15(e), 3.07, 4.15, 4.19 or 9.05.

 

At
the same time as the Registrar registers on its records an increase or decrease
in the principal amount of any Global Note, the Trustee, as custodian for the
Depository, shall notate such increase or decrease on the schedule of increases
or decreases to such Global Note.

 

All Notes issued under this Indenture shall
vote and consent together on all matters as one class and no series of Notes
shall have the right to vote or consent as a separate class on any matter.

 

The Trustee may appoint an authenticating
agent (the “Authenticating Agent”)
reasonably acceptable to the Company to authenticate Notes.  Unless otherwise provided in the appointment,
an Authenticating Agent may authenticate Notes whenever the Trustee may do
so.  Each reference in this Indenture to
authentication by the Trustee includes authentication by such Authenticating
Agent.  An Authenticating Agent has the
same rights as an Agent to deal with the Company and Affiliates of the Company.

 

The Notes shall be issuable in fully
registered form only, without coupons, in denominations of $2,000 in principal
amount and any integral multiple of $1,000 in excess of $2,000, subject to the
payment of interest on any Notes on any Interest Payment Date by issuance of
PIK Notes, in which case the aggregate principal amount of Global Notes
previously authenticated hereunder may be increased by, or additional Notes
constituting PIK Notes may be issued in, integral multiples of $1.00 in an
aggregate principal amount equal to the PIK Interest Amount with respect to
such Interest Payment Date for such Notes rounded up the nearest whole dollar.

 

41

 

Each PIK Note is an additional obligation of
the Company and shall be governed by, and entitled to the benefits of, this
Indenture and shall be subject to the terms of this Indenture, shall rank pari passu with and be subject to the same terms (including
the rate of interest from time to time payable thereon) as all other Notes
(except, as the case may be, with respect to the issue date).

 

SECTION 2.03                                                                    Registrar and
Paying Agent.

 

The Company shall maintain an office or
agency which shall initially be the office of the Trustee, c/o Wilmington Trust Company, Corporate Client
Services — CCM OAS, 1100 North Market Street, Wilmington, DE 19801,
where (a) Notes may be presented or surrendered for registration of
transfer or for exchange (the “Registrar”)
and (b) Notes may be presented or surrendered for payment (the “Paying Agent”). 
The Registrar shall keep a register (the “Register”) of the Notes
and of their transfer and exchange.  The
Company, upon prior written notice to the Trustee, may have one or more
co-Registrars and one or more additional Paying Agents reasonably acceptable to
the Trustee.  The Company may change the
Paying Agent or Registrar without prior notice to the Holders.  The term “Paying
Agent” includes any additional Paying Agent and the term “Registrar”
includes any additional Registrar.  The
Company or any Affiliate of the Company may act as Paying Agent or Registrar.

 

The Company shall enter into an appropriate
agency agreement with any Agent not a party to this Indenture, which agreement
shall incorporate the provisions of the TIA and implement the provisions of
this Indenture that relate to such Agent. 
The Company shall notify the Trustee in writing, in advance, of the name
and address of any such Agent.  If the
Company fails to maintain a Registrar or Paying Agent, or fails to give the
foregoing notice, the Trustee shall act as such, as shall be entitled to
appropriate compensation therefor, pursuant to Section 7.07.

 

The Company initially appoints the Trustee as
Registrar, Paying Agent and agent for service of demands and notices in
connection with the Notes.  The Paying
Agent or Registrar may resign upon thirty (30) days’ written notice to the
Company.

 

The Company appoints The Depository Trust
Company as Depository.

 

SECTION 2.04                                                                    Obligations of
Paying Agent.

 

The Company shall require each Paying Agent
other than the Trustee to agree in writing that such Paying Agent shall hold in
trust for the benefit of the Holders or the Trustee all assets held by the
Paying Agent for the payment of principal of, or interest on, the Notes
(whether such assets have been distributed to it by the Company or any other
obligor on the Notes), and the Paying Agent shall promptly notify the Trustee
in writing of any Default by the Company (or any other obligor on the Notes) in
making any such payment.  The Company at
any time may require a Paying Agent to distribute all assets held by it to the
Trustee and account for any assets disbursed and the Trustee may at any time
during the continuance of any payment Default, upon written request to a Paying
Agent, require such Paying Agent to distribute all assets held by it to the
Trustee and to account for any assets distributed.  Upon receipt by the Trustee of all assets
that shall have been delivered by the Company to the Paying Agent, the Paying
Agent shall have 

 

42

 

no further liability for
such assets.  If the Company or one of
its Subsidiaries acts as Paying Agent, it shall segregate and hold in a separate
trust fund for the benefit of the Holders all assets held by it as Paying
Agent.

 

SECTION 2.05                                                                    Holder Lists.

 

The Trustee shall preserve in as current a
form as is reasonably practicable the most recent list available to it of the
names and addresses of the Holders and shall otherwise comply with TIA Section 312(b).  If the Trustee is not the Registrar, the
Company shall furnish or cause the Registrar to furnish to the Trustee before
each Record Date and at such other times as the Trustee may request in writing
a list as of such date and in such form as the Trustee may reasonably request
of the names and addresses of the Holders, which list may be conclusively
relied upon by the Trustee.

 

SECTION 2.06                                                                    Transfer and
Exchange.

 

Subject to the provisions of Sections 2.14
and 2.15, when Notes are presented to the
Registrar or a co-Registrar with a request to register the transfer of such
Notes or to exchange such Notes for an equal principal amount of Notes of other
authorized denominations, the Registrar or co-Registrar shall register the
transfer or make the exchange as requested; provided,
however, that the Notes presented or
surrendered for registration of transfer or exchange shall be duly endorsed or
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Registrar or co-Registrar, duly executed by the Holder thereof
or such Holder’s attorney duly authorized in writing, and such other documents
as the Registrar or Co-Registrar may reasonably require.  To permit registrations of transfers and
exchanges, the Company shall execute, issue and deliver and the Trustee shall
authenticate Notes at the Registrar’s or co-Registrar’s request.  No service charge shall be made for any
registration of transfer or exchange, but the Company or the Trustee may
require payment of a sum sufficient to cover any transfer tax or similar
governmental charge payable in connection therewith (other than any such
transfer taxes or similar governmental charge payable upon exchanges pursuant
to Sections 2.10, 2.14, 2.15(e),  3.07, 4.15, 4.19 or 9.05 not
involving any transfer, in which event the Company shall be
responsible for the payment of such taxes). 
All Notes issued upon any registration of transfer or exchange of Notes
shall be the valid obligations of the Company, evidencing the same debt, and
entitled to the same benefits under this Indenture and the Note Guarantees, as
the Notes surrendered upon such registration of transfer or exchange.

 

The Registrar or co-Registrar shall not be
required to register the transfer or exchange of any Note (a) during a
period beginning at the opening of business fifteen (15) days before the
mailing of a notice of redemption of Notes and ending at the close of business
on the day of such mailing and (b) selected for redemption in whole or in
part pursuant to Article Three, except
the unredeemed portion of any Note being redeemed in part.

 

Any Holder of a Global Note shall, by
acceptance of such Global Note, agree that transfers of beneficial interests in
such Global Note may be effected only through the Depository, in accordance
with this Indenture and the Applicable Procedures.

 

43

 

SECTION 2.07                       Replacement
Notes.

 

If a mutilated Note is surrendered to the
Trustee or if the Holder of a Note claims in writing that the Note has been
lost, destroyed or wrongfully taken, then, in the absence of written notice to
the Company or the Trustee that such Note has been acquired by a protected
purchaser, the Company shall execute, issue and deliver and the Trustee shall
authenticate a replacement Note of like tenor and principal amount and bearing
a number not contemporaneously outstanding if the Trustee’s requirements are
met.  Except with respect to mutilated
Notes, if required by the Trustee or the Company, such Holder must provide an
affidavit of lost certificate and an indemnity bond or other indemnity,
sufficient in the judgment of both the Company and the Trustee, to protect the
Company, the Trustee or any Agent from any loss which any of them may suffer if
a Note is replaced.  The Company may
charge such Holder for the Company’s reasonable out-of-pocket expenses in
replacing a Note, including reasonable fees and expenses of its counsel and of
the Trustee and its counsel.  In case any
mutilated, lost, destroyed or wrongfully taken Note has become or is about to
become due and payable, the Company in its discretion may pay such Note instead
of issuing a new Note in replacement thereof. 
Every replacement Note shall constitute an additional obligation of the
Company, entitled to the benefits of this Indenture, subject to Section 2.08.

 

SECTION 2.08                       Outstanding
Notes.

 

Notes outstanding at any time are all the
Notes that have been authenticated by the Trustee except those cancelled by it,
those delivered to it for cancellation and those described in this Section 2.08 as not outstanding.  Subject to the provisions of Section 2.09, a Note does not cease to be
outstanding because the Company or any of its Affiliates holds the Note.

 

If a Note is replaced pursuant to Section 2.07 (other than a mutilated Note
surrendered for replacement), it ceases to be outstanding unless the Trustee
receives proof satisfactory to it that the replaced Note is held by a protected
purchaser.  A mutilated Note ceases to be
outstanding upon surrender of such Note and replacement thereof pursuant to Section 2.07.

 

If on a Redemption Date or the Maturity Date
the Paying Agent holds U.S. Legal Tender or U.S. Government Obligations
sufficient to pay all of the principal and interest due on the Notes payable on
that date and is not prohibited from paying such money to the Holders thereof
pursuant to the terms of this Indenture, then on and after that date such Notes
cease to be outstanding and interest on them ceases to accrue.

 

SECTION 2.09                       Treasury Notes;
When Notes Are Disregarded.

 

In determining whether the Holders of the
required principal amount of Notes have concurred in any direction, waiver,
consent or notice, Notes owned by the Company or any of its Affiliates shall be
considered as though they are not outstanding, except that for the purposes of
determining whether the Trustee shall be protected in relying on any such direction,
waiver or consent, only Notes which a Trust Officer of the Trustee actually
knows are so owned shall be so considered. 
Notes so owned which have been pledged in good faith may be regarded as
outstanding if the pledgee establishes to the satisfaction of the Trustee the
pledgee’s right so to 

 

44

 

act with respect to such
Notes and that the pledgee is not the Company or any other obligor upon the
Notes or any Affiliate of the Company or of such other obligor.

 

The aggregate principal amount of the Notes,
at any date of determination, shall be the principal amount of the Notes
(including any outstanding PIK Notes issued (including by any increase in the
principal amount of any Global Note previously authenticated) hereunder)
outstanding at such date of determination (as determined in accordance with
this Section 2.09 and Section 2.08).  With respect to any matter requiring consent,
waiver, approval or other action of the Holders of a specified percentage of
the principal amount of all the Notes then outstanding, such percentage shall
be calculated, on the relevant date of determination, by dividing (a) the
principal amount, as of such date of determination, of Notes held by Holders
that have so consented by (b) the aggregate principal amount, as of such
date of determination, of the Notes then outstanding, in each case, as
determined in accordance with this Section 2.09 and Section 2.08.  Any such calculation made pursuant to this Section 2.09
shall be made by the Company and delivered to the Trustee pursuant to an
Officers’ Certificate.

 

SECTION 2.10                       Temporary
Notes.

 

Until definitive Notes are ready for
delivery, the Company may prepare and execute and deliver and the Trustee shall
authenticate temporary Notes upon receipt of a written order of the Company in
the form of an Officers’ Certificate. 
The Officers’ Certificate shall specify the amount of temporary Notes to
be authenticated and the date on which the temporary Notes are to be
authenticated.  Temporary Notes shall be
substantially in the form of definitive Notes but may have variations that the
Company considers appropriate for temporary Notes.  Without unreasonable delay, the Company shall
execute and deliver and the Trustee shall authenticate upon receipt of a
written order of the Company pursuant to Section 2.02
definitive Notes in exchange for temporary Notes.  Until so exchanged, the temporary Notes shall
be entitled to the same benefits under this Indenture as definitive Notes.

 

SECTION 2.11                       Cancellation.

 

The Company at any time may deliver Notes
previously authenticated hereunder which the Company has acquired in any lawful
manner to the Trustee for cancellation. 
The Registrar and the Paying Agent shall forward to the Trustee any
Notes surrendered to them for transfer, exchange or payment.  The Trustee, or at the direction of the
Trustee, the Registrar or the Paying Agent, and no one else, shall cancel all
Notes surrendered for transfer, exchange, payment or cancellation.  Subject to Section 2.07,
the Company may not issue new Notes to replace Notes that it has paid or
delivered to the Trustee for cancellation. 
If the Company shall acquire any of the Notes, such acquisition shall
not operate as a redemption or satisfaction of the Indebtedness represented by
such Notes unless and until the same are surrendered to the Trustee for
cancellation pursuant to this Section 2.11.  The Trustee shall dispose of all cancelled
Notes in accordance with the Trustee’s customary procedures.

 

SECTION 2.12                       CUSIP Numbers.

 

A “CUSIP” number
shall be printed on the Notes, and the Trustee shall use the CUSIP number in
notices of redemption, purchase or exchange as a convenience to Holders; provided  

 

45

 

that any such notice may
state that no representation is made as to the correctness or accuracy of the
CUSIP number printed in the notice or on the Notes and that reliance may be
placed only on the other identification numbers printed on the Notes.  The Company shall promptly notify the Trustee
of any change in the CUSIP number.

 

SECTION 2.13                       Deposit of
Moneys.

 

Prior to 12:00 p.m. (noon) New York, New York time on each
Interest Payment Date and the Maturity Date, the Company shall deposit with the
Paying Agent U.S. Legal Tender sufficient to make payments, if any, of any
principal, premium and interest (other than any interest payable as PIK
Interest on such Interest Payment Date in accordance with Section 4.01(d))
due on such Interest Payment Date or the Maturity Date, as the case may be.

 

SECTION 2.14                       Book-Entry
Provisions for Global Notes.

 

(a)           The Global
Notes initially shall (1) be registered in the name of the Depository or
the nominee of such Depository, (2) be delivered to the Trustee as
custodian for such Depository and (3) bear legends as set forth in Exhibit C.  Members of, or participants in, the
Depository (“Agent Members”) shall have no
rights under this Indenture with respect to any Global Note held on their
behalf by the Depository, or the Trustee as its custodian, or under any Global
Note, and the Depository may be treated by the Company, the Trustee and any
agent of the Company or the Trustee as the absolute owner of the Global Note
for all purposes whatsoever.  Notwithstanding
the foregoing, nothing herein shall prevent the Company, the Trustee or any
agent of the Company or the Trustee from giving effect to any written
certification, proxy or other authorization furnished by the Depository or
impair, as between the Depository and its Agent Members, the operation of
customary practices governing the exercise of the rights of a Holder of any
Note.

 

(b)           Transfers of
the Global Notes shall be limited to transfers in whole, but not in part, to
the Depository, its successors or their respective nominees.  Interests of beneficial owners in the Global
Notes may be transferred or exchanged in accordance with the Applicable
Procedures of the Depository and the provisions of Section 2.15, provided,
however, that prior to the expiration of the Restricted Period, transfers
of beneficial interests in the Regulation S Global Note may not be made to a
U.S. Person or for the account or benefit of a U.S. Person.  In addition, Notes in the form of
certificated Notes in registered form in substantially the form set forth in Exhibit A
hereto (the “Physical Notes”) shall be transferred to all beneficial
owners in exchange for their beneficial interests in the Global Notes if (1) either
(x) the Depository notifies the Company that it is unwilling or unable to
continue as Depository for the Global Notes or (y) at any time such
Depository ceases to be a “clearing agency” registered under the Exchange Act
and in either case a successor Depository is not appointed by the Company
within ninety (90) days of such notice or (2) a Default or Event of
Default has occurred and is continuing and the Trustee has received a request
from the Depository; provided that a beneficial interest in the
Regulation S Global Note may not be exchanged for a Physical Note or
transferred to a Person who takes delivery thereof in the form of a Physical
Note prior to (A) the expiration of the Restricted Period and (B) the
receipt by 

 

46

 

the
Registrar of a certification, pursuant to Rule 903(b)(3)(ii)(B) under
the Securities Act (except in the case of a “Distributor” as defined in Rule 902(d) under
the Securities Act) and substantially in the form of Exhibit I
hereto, of beneficial ownership of the Notes by a non-U.S. Person or a U.S.
Person who purchased the Notes in a transaction that did not require
registration under the Securities Act, except in the case of a transfer
pursuant to an exemption from the registration requirements of the Securities
Act other than Rule 903 or Rule 904.

 

(c)           Any beneficial
interest in one of the Global Notes that is transferred to a Person who takes
delivery in the form of a beneficial interest in another Global Note shall,
upon transfer, cease to be a beneficial interest in such first Global Note and
become a beneficial interest in such other Global Note and shall thereafter be
subject to all transfer restrictions, if any, and other procedures applicable
to a beneficial interest in such other Global Notes for as long as it remains
such an interest.

 

(d)           In connection
with any transfer or exchange of a portion of the beneficial interest in the
Global Note to beneficial owners pursuant to clause (b), the Registrar
shall (if one or more Physical Notes are to be issued) reflect on its books and
records the date and a decrease in the principal amount of the Global Note in
an amount equal to the principal amount of the beneficial interest in the
Global Note to be transferred, and the Company shall execute and deliver, and
the Trustee shall authenticate, one or more Physical Notes of like tenor and
aggregate principal amount.

 

(e)           In connection
with the transfer of an entire Global Note to beneficial owners pursuant to clause
(b), the Global Note shall be deemed to be surrendered to the Trustee for
cancellation, and the Company shall execute and deliver, and, upon receipt of
an Authentication Order in accordance with Section 2.02, the
Trustee shall authenticate, to each beneficial owner identified by the
Depository in exchange for its beneficial interest in the Global Note, an equal
aggregate principal amount of Physical Notes of authorized denominations.

 

(f)            Any Physical
Note constituting a Restricted Security delivered in exchange for an interest
in the Global Note pursuant to clause (b), except as otherwise provided
by clauses (a)(1)(i) and (c) of Section 2.15,
shall bear the legend regarding transfer restrictions applicable to the
Physical Notes set forth in Exhibit D.

 

(g)           The Holder of a
Global Note may grant proxies and otherwise authorize any Person, including
Agent Members and Persons that may hold interests through Agent Members, to
take any action which a Holder is entitled to take under this Indenture or the
Notes.

 

SECTION 2.15                       Special
Transfer Provisions.

 

(a)           Transfers to
Non-QIB Accredited Investors and Non-U.S. Persons.  The following provisions shall apply with
respect to the registration of any proposed transfer of a Note constituting a
Restricted Security to any Accredited Investor which is not a QIB or to any
Non-U.S. Person:

 

47

 

(1)           the Registrar shall register the transfer of any
Physical Note constituting a Restricted Security which after transfer is to be
evidenced by a Physical Note, whether or not such Note bears the Private
Placement Legend, upon surrender of such Physical Note to the Registrar, if (i) the
requested transfer is after the date one year after the Issue Date or (ii) (A) in
the case of a transfer to an Accredited Investor which is not a QIB (excluding
Non-U.S. Persons), the proposed transferee has delivered to the Registrar a
certificate substantially in the form of Exhibit E hereto or (B) in
the case of a transfer to a Non-U.S. Person, the proposed transferor has
delivered to the Registrar a certificate substantially in the form of Exhibit F
hereto, whereupon the Registrar shall reflect on its books and records the date
and the Company shall execute and deliver and the Trustee shall authenticate
one or more Physical Notes of like tenor and principal amount and the Trustee
shall cancel the Physical Notes so transferred; or

 

(2)           if the proposed transferor is an Agent Member
holding a beneficial interest in a Global Note and the proposed transferee is
an Agent Member who will hold a beneficial interest in a Global Note, the
Registrar shall register such transfer upon receipt of (i) the
certificate, if any, required by clause (1) above and (ii) instructions
given in accordance with the Applicable Procedures and the Registrar’s
procedures, whereupon the Registrar shall reflect on its books and records the
date and a decrease in the principal amount of the Global Note in an amount
equal to the principal amount of the beneficial interest in the Global Note to
be transferred and a corresponding increase in the Global Note to which such
beneficial interest is transferred; or

 

(3)           if the proposed transferor is an Agent Member
holding a beneficial interest in a Global Note and the proposed transferee’s
interest will be evidenced by a Physical Note, the Registrar shall register
such transfer upon receipt of (i) the certificate, if any, required by clause
(1) above and (ii) instructions given in accordance with the
Applicable Procedures and the Registrar’s procedures, whereupon the Registrar
shall reflect on its books and records the date and a decrease in the principal
amount of the Global Note in an amount equal to the principal amount of the
beneficial interest in the Global Note to be transferred, and the Company shall
execute and deliver and the Trustee shall authenticate one or more Physical
Notes of like tenor and principal amount; or

 

(4)           if the proposed transferee is an Agent Member and
the Notes to be transferred consist of Physical Notes which after transfer are
to be evidenced by an interest in a Global Note, the Registrar shall register
such transfer upon surrender of such Physical Note to the Registrar, upon
receipt of (i) the certificate, if any, required by clause (1) above
and (ii) instructions given in accordance with the Applicable Procedures and
the Registrar’s procedures, whereupon the Registrar shall reflect on its books
and records the date and an increase in the principal amount of such Global
Note in an amount equal to the principal amount of the Physical Notes to be
transferred and the Trustee shall cancel the Physical Notes so transferred.

 

48

 

(b)           Transfers to
QIBs.  The following provisions shall
apply with respect to the registration of any proposed transfer of a Note
constituting a Restricted Security to a QIB (excluding transfers to Non-U.S.
Persons):

 

(1)           The Registrar shall register the transfer if such
transfer is being made by a proposed transferor who has checked the box
provided for on the form of Note stating, or has otherwise advised the Company
and the Registrar in writing, that the sale has been made in compliance with
the provisions of Rule 144A to a transferee who has signed the
certification provided for on the form of Note stating, or has otherwise
advised the Company and the Registrar in writing, that it is purchasing the
Note for its own account or an account with respect to which it exercises sole
investment discretion and that it and any such account is a QIB within the
meaning of Rule 144A, and is aware that the sale to it is being made in
reliance on Rule 144A and acknowledges that it has received such
information regarding the Company as it has requested pursuant to Rule 144A
or has determined not to request such information and that it is aware that the
transferor is relying upon its foregoing representations in order to claim the
exemption from registration provided by Rule 144A.

 

(2)           Subject to compliance with clause (1) above,
if the proposed transferee is an Agent Member, and the Notes to be transferred
consist of Physical Notes which after transfer are to be evidenced by an
interest in the Global Note, upon surrender of such Physical Note to the
Registrar, upon receipt by the Registrar of instructions given in accordance
with the Applicable Procedures and the Registrar’s procedures, the Registrar
shall reflect on its books and records the date and an increase in the
principal amount of the Global Note in an amount equal to the principal amount
of the Physical Notes to be transferred, and the Trustee shall cancel the
Physical Notes so transferred.

 

(3)           Subject to compliance with clause (1) above,
if the Notes to be transferred consist of Physical Notes which after transfer
are to be evidenced by Physical Notes, upon the surrender of such Physical
Notes to the Registrar, the Registrar shall reflect on its books and records
the date and the Company shall execute and deliver and the Trustee shall
authenticate one or more Physical Notes of like tenor and principal amount and
the Trustee shall cancel the Physical Notes to be transferred.

 

(4)           Subject to compliance with clause (1) above,
if the proposed transferor is an Agent Member holding a beneficial interest in
a Global Note and the proposed transferee is an Agent Member who will hold a
beneficial interest in a Global Note, the Registrar shall reflect on its books
and records the date and a decrease in the principal amount of the Global Note
in an amount equal to the principal amount of the beneficial interest in the
Global Note to be transferred and a corresponding increase in the Global Note
to which such beneficial interest is transferred.

 

49

 

(5)           Subject to compliance with clause (1) above,
if the proposed transferor is an Agent Member holding a beneficial interest in
a Global Note and the proposed transferee’s interest will be evidenced by a
Physical Note, the Registrar shall reflect on its books and records the date
and a decrease in the principal amount of the Global Note in an amount equal to
the principal amount of the beneficial interest in the Global Note to be
transferred, and the Company shall execute and deliver and the Trustee shall
authenticate one or more Physical Notes of like tenor and principal amount.

 

(c)           Private
Placement Legend.  Upon the
transfer, exchange or replacement of Notes not bearing the Private Placement
Legend, the Registrar shall deliver Notes that do not bear the Private
Placement Legend.  Upon the transfer,
exchange or replacement of Notes bearing the Private Placement Legend, the
Registrar shall deliver only Notes that bear the Private Placement Legend
unless (1) the circumstance contemplated by clause (a)(1)(i) of
this Section 2.15 exists or (2) there is delivered to the
Registrar an Opinion of Counsel reasonably satisfactory to the Company and the
Trustee to the effect that neither such legend nor the related restrictions on
transfer are required in order to maintain compliance with the provisions of
the Securities Act or (3) the Notes bearing the Private Placement Legend
are being exchanged for Exchange Notes issued under Section 2.02
pursuant to a Registration Rights Agreement. 
Upon the issuance of PIK Notes in payment of PIK Interest payable with
respect to any Notes bearing the Private Placement Legend, such PIK Notes shall
bear the Private Placement Legend.  By
its acceptance of any Note bearing the Private Placement Legend, each Holder of
such a Note acknowledges the restrictions on transfer of such Note set forth in
this Indenture and in the Private Placement Legend and agrees that it shall
transfer such Note only as provided in this Indenture.

 

(d)           General.  The Registrar shall not register a transfer
of any Note unless such transfer complies with the restrictions on transfer of
such Note set forth in this Indenture. 
In connection with any transfer of Notes, each Holder agrees by its
acceptance of the Notes to furnish the Registrar or the Company such
certifications, legal opinions or other information as either of them may
reasonably require to confirm that such transfer is being made pursuant to an
exemption from, or a transaction not subject to, the registration requirements
of the Securities Act; provided that the Registrar shall not be required
to determine (but may rely on a determination made by the Company with respect
to) the sufficiency of any such certifications, legal opinions or other information.

 

The Trustee shall have no obligation or duty
to monitor, determine or inquire as to compliance with any restrictions on
transfer imposed under this Indenture or under applicable law with respect to
any transfer of any interest in any security (including any transfers between
or among Agent Members or beneficial owners of interests in any Global Note)
other than to require delivery of such certificates, Opinions of Counsel and
other documentation or evidence as are expressly required by, and to do so if
and when expressly required by the terms of, this Indenture, and to examine the
same to determine substantial compliance as to form with the express
requirements hereof.

 

50

 

The Registrar shall retain copies of all
letters, notices and other written communications received by it pursuant to Section 2.14 or this Section 2.15.  The Company shall have the right to inspect
and make copies of all such letters, notices or other written communications at
any reasonable time upon the giving of reasonable written notice to the
Registrar.

 

Neither the Trustee nor any Agent shall have
any responsibility for any actions taken or not taken by DTC.

 

(e)           Exchange Offer.  Upon
the occurrence of an Exchange Offer with respect to Restricted Securities, the
Company shall execute and deliver, and, upon receipt of an Authentication Order
in accordance with Section 2.02, the Trustee shall authenticate:

 

(1)              Exchange Notes in global form in an aggregate
principal amount equal to the principal amount of the beneficial interests in
the Restricted Securities constituting Global Notes accepted for exchange in
the Exchange Offer by Persons that certify in the applicable letters of
transmittal that (A) any Exchange Notes received by such Person will be
acquired in the ordinary course of its business, (B) at the time of
commencement of the Exchange Offer such Person has no arrangement or
understanding with any other Person to participate in the distribution (within
the meaning of the Securities Act) of the Exchange Notes in violation of the
provisions of the Securities Act, (C) such Person is not an “affiliate”
(as defined in Rule 405 under the Securities Act) of the Company or if
such Person is an affiliate such Person will comply with the registration and
prospectus delivery requirements of the Securities Act to the extent
applicable, (D) if such Person is not a broker-dealer, that it is not
engaged in, and does not intend to engage in, the distribution of the Exchange
Notes and (E) if such Person is a Participating Broker-Dealer (as defined
in the Registration Rights Agreement) that will receive Exchange Notes for its
own account in exchange for Notes that were acquired as a result of
market-making or other trading activities, that it will deliver a Prospectus
(as defined in the Registration Right Agreements) in connection with any resale
of the Exchange Notes; and

 

(2)           Physical Notes in an aggregate principal amount
equal to the principal amount of the Restricted Securities constituting Physical
Notes accepted for exchange in the Exchange Offer by Persons that certify in
the applicable letters of transmittal as to matters specified in clauses (A),
(B), (C), (D) and (E) of clause (1) above.

 

SECTION 2.16                       Transfers of
Global Notes and Physical Notes.

 

A transfer of a Global Note or a Physical
Note (including the right to receive principal and interest payable thereon)
may be made only by the Registrar’s entering the transfer in the Register.  Prior to such entry, the Company shall treat
the person in whose name such Note is registered as the owner of the Note for
all purposes.

 

51

 

SECTION 2.17                       Defaulted
Interest.

 

If the Company defaults in a payment of
interest on the Notes, the Company shall pay defaulted interest (plus interest
on such defaulted interest to the extent lawful) in any lawful manner at the
rate provided in the Notes.  The Company
may pay the defaulted interest to the Persons who are Holders on a subsequent
special record date.  The Company shall
fix or cause to be fixed any such special record date and payment date to the
reasonable satisfaction of the Trustee and shall promptly mail to each Holder a
notice that states the special record date, the payment date and the amount of defaulted
interest to be paid.

 

SECTION 2.18                       Computation of
Interest.

 

Interest on the Notes shall be computed on
the basis of a 360-day year comprised of twelve 30-day months.

 

ARTICLE THREE

 

REDEMPTION

 

SECTION 3.01                       Optional
Redemption.

 

(a)           The Company may,
at its option, redeem the Notes, in whole or in part, at specified times and
under specified conditions, as set forth in this Section 3.01.  If the Company elects to redeem Notes
pursuant to this Section 3.01, it shall, prior to mailing the
notice of redemption referred to in Section 3.04 and at least 30
days but not more than 60 days prior to the Redemption Date (unless a shorter
notice shall be satisfactory to the Trustee) furnish to the Trustee and Paying
Agent an Officers’ Certificate setting forth the Redemption Date and the
principal amount of the Notes to be redeemed, the clause of this Indenture
pursuant to which the redemption shall occur and the Redemption Price.

 

(b)           The Company
may, at its option, on any one or more occasions, redeem all or a part of the
Notes upon not less than 30 days’ nor more than 60 days’ prior notice to the
Trustee, at the Redemption Prices (expressed as percentages of the principal
amount) set forth below plus accrued and unpaid interest to (but not including)
the Redemption Date (subject to any installment of interest thereon, the
maturity of which is on or prior to the Redemption Date, being payable to
Holders of record at the close of business on the relevant Record Date referred
to in the Notes), if redeemed during the twelve-month period commencing on March 15 of the years
set forth below:

 

	
  Year

  	
   

  	
  Percentage

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2010

  	
   

  	
  105

  	
  %

  
	
  2011

  	
   

  	
  104

  	
  %

  
	
  2012

  	
   

  	
  103

  	
  %

  
	
  2013

  	
   

  	
  102

  	
  %

  
	
  2014

  	
   

  	
  101

  	
  %

  

 

52

 

(c)           Notwithstanding
clause (b) above, if the Company delivers a Board Resolution
to the Trustee setting forth the irrevocable determination of the Company not
to complete construction of either the Aurora Facility or Mt. Vernon Facility,
then during the 90-day period following the Issue Date, the Company may, at its
option, redeem up to $25,000,000 in aggregate principal amount of the Notes at
a Redemption Price equal to 101% of the principal amount of the Notes redeemed
plus accrued and unpaid interest on the Notes redeemed to (but not including)
the Redemption Date (subject to any installment of interest thereon, the
maturity of which is on or prior to the Redemption Date, being payable to
Holders of record at the close of business on the relevant Record Date referred
to in the Notes).

 

SECTION 3.02                       No Mandatory
Redemption.

 

The Company shall not be required to make any
mandatory redemption or sinking fund payments with respect to the Notes.

 

SECTION 3.03                       Selection of
Notes to Be Redeemed.

 

If fewer than all of the Notes are to be
redeemed pursuant to the provisions of this Indenture, the Trustee shall select
the Notes to be redeemed (a) in compliance with the requirements of the
principal national securities exchange, if any, on which such Notes are listed
or (b) if such Notes are not then listed on a national securities
exchange, on a pro  rata
basis, by lot or by such method as the Trustee may reasonably determine is fair
and appropriate; provided, that if any
redemption is made pursuant to Section 3.01(c),
the Trustee will select the Notes only on a pro  rata
basis or on as nearly a pro rata basis as is practicable (subject to DTC
procedures), unless such method is otherwise prohibited.  The Trustee shall make the selection from the
Notes outstanding and not previously called for redemption and shall promptly
notify the Company in writing of the Notes selected for redemption and, in the
case of any Note selected for partial redemption, the principal amount thereof,
to be redeemed.

 

The Trustee will promptly notify the Company
in writing of the Notes selected for redemption and, in the case of any Note
selected for partial redemption or purchase, the principal amount thereof to be
redeemed or purchased. Notes and portions of Notes selected will be in
principal amounts of $2,000 and integral multiples of $1,000 in excess thereof,
except that (i) if all of the Notes of a Holder are to be redeemed, the
entire outstanding principal amount of Notes held by such Holder, even if not a
multiple of $1,000, shall be redeemed, subject in the case of Global Notes, to
the procedures of DTC; and (ii) in any event the unredeemed portion of
Notes redeemed in part shall be in a principal amount of at least $2,000.  Provisions of this Indenture that apply to
Notes called for redemption also apply to portions of Notes called for
redemption.

 

SECTION 3.04                       Notice of
Redemption.

 

At least 30 days but not more than 60 days
before a Redemption Date, the Company shall mail or cause to be mailed a notice
of redemption by first class mail, postage prepaid, to each Holder whose Notes
are to be redeemed at such Holder’s registered address, with a copy to the
Trustee and any Paying Agent.  At the
Company’s written request delivered at least fifteen days prior to the date
such notice is to be given (unless a shorter period shall be acceptable to the

 

53

 

Trustee), the Trustee shall
give the notice of redemption in the Company’s name and at the Company’s
expense, provided the Company provides the Trustee with all information
required for such notice of redemption. 
Failure to give notice of redemption, or any defect therein, to any
Holder of any Note selected for redemption shall not impair or affect the
validity of the redemption of any other Note.

 

Each notice of redemption shall identify the
Notes to be redeemed and shall state:

 

(a)           the Redemption
Date;

 

(b)           the Redemption
Price and the amount of accrued interest, if any, to be paid;

 

(c)           the name and
address of the Paying Agent;

 

(d)           the CUSIP
number;

 

(e)           the subsection
of Section 3.01 pursuant to which such redemption is being made;

 

(f)            the place where
such Notes called for redemption must be surrendered to the Paying Agent to
collect the Redemption Price plus accrued interest, if any;

 

(g)           Notes and
portions of Notes selected will be in principal amounts of $2,000 and integral
multiples of $1,000 in excess thereof, except that (i) if all of the Notes
of a Holder are to be redeemed, the entire outstanding principal amount of
Notes held by such Holder, even if not a multiple of $1,000, shall be redeemed,
subject in the case of Global Notes, to the procedures of DTC; and (ii) in
any event the unredeemed portion of Notes redeemed in part shall be in a
principal amount of at least $2,000;

 

(h)           that, unless
the Company fails to deposit with the Paying Agent funds in satisfaction of the
applicable Redemption Price plus accrued interest, if any, interest on Notes
called for redemption ceases to accrue on and after the Redemption Date in
accordance with Section 3.06, and the only remaining right of the
Holders of such Notes is to receive payment of the Redemption Price plus
accrued interest, if any, upon surrender to the Paying Agent of the Notes
redeemed;

 

(i)            if any Note is
being redeemed in part, the portion of the principal amount of such Note to be
redeemed and that, after the Redemption Date, and upon surrender of such Note,
a new Note or Notes in the aggregate principal amount equal to the unredeemed
portion thereof shall be issued; and

 

(j)            if fewer than
all the Notes are to be redeemed, the identification of the particular Notes
(or portion thereof) to be redeemed, as well as the aggregate principal amount
of Notes to be redeemed and the aggregate principal amount of Notes to be
outstanding after such partial redemption.

 

54

 

If any of the Notes to be redeemed is in the
form of a Global Note, then the Company shall modify such notice to the extent
necessary to accord with the procedures of the Depository applicable to
redemption.

 

SECTION 3.05                       Effect of
Notice of Redemption.

 

Once notice of redemption is mailed in
accordance with Section 3.04, Notes or
portions thereof called for redemption shall become irrevocably due and payable
on the Redemption Date and at the Redemption Price plus accrued interest
thereon.  Upon surrender to the Trustee
or Paying Agent, such Notes or portions thereof called for redemption shall be
paid at the Redemption Price plus accrued interest thereon to the Redemption
Date, but installments of interest thereon, the maturity of which is on or
prior to the Redemption Date, shall be payable to Holders of record at the
close of business on the relevant Record Dates referred to in the Notes. No
notice of any redemption may be subject to any conditions precedent or
otherwise conditional.

 

SECTION 3.06                       Deposit of
Redemption Price.

 

Not later than 12:00 p.m. (noon) local
time in the place of payment on the Redemption Date, the Company shall deposit
with the Paying Agent U.S. Legal Tender sufficient to pay the Redemption Price
plus accrued and unpaid interest, if any, of all Notes or portions thereof to
be redeemed on that date.  The Paying
Agent shall promptly return to the Company any U.S. Legal Tender so deposited
which is not required for that purpose, except with respect to monies owed as
obligations to the Trustee pursuant to Section 7.07.

 

If the Company complies with the preceding
paragraph, then, unless the Company defaults in the payment of such Redemption
Price plus accrued and unpaid interest, if any, interest on the Notes to be
redeemed shall cease to accrue on and after the applicable Redemption Date,
whether or not such Notes are presented for payment, and the only remaining
right of the Holders of such Notes shall be to receive payment of the
Redemption Price upon surrender to the Paying Agent of the Notes redeemed.  If any Note called for redemption shall not
be so paid upon surrender for redemption because of the failure of the Company
to comply with the preceding paragraph, interest shall be paid on the unpaid
principal, from the Redemption Date until such principal is paid, and to the
extent lawful, on any interest not paid on such unpaid principal, in each case
at the rate provided in the Notes and in Section 4.01 hereof.

 

SECTION 3.07                       Notes Redeemed
in Part.

 

Upon surrender of a Note that is to be
redeemed in part, the Company shall execute and deliver and, upon receipt of an
Authentication Order in accordance with Section 2.02, the Trustee
shall authenticate for the Holder at the expense of the Company a new Note or
Notes equal in principal amount to the unredeemed portion of the Note
surrendered.

 

SECTION 3.08                       Company May Acquire
Notes.

 

The Company or its Affiliates (or any Person
acting on behalf of the Company or its Affiliates) may at any time and from
time to time acquire the Notes by means other than redemption, including by
tender offer, open market purchases, negotiated transactions or 

 

55

 

otherwise, so long as such
acquisition is not prohibited by applicable securities laws or regulations or
the terms of this Indenture.  In
accordance with, and subject to, Section 2.11, the Company may
deliver such acquired Notes to the Trustee for cancellation.

 

ARTICLE FOUR

 

COVENANTS

 

SECTION 4.01                       Payment of
Notes; Accrual of Interest.

 

(a)           The Company
shall pay the principal of, or premium, if any, or interest, if any, on the
Notes on the dates and in the manner provided in the Notes and in this
Indenture.

 

(b)           An installment
of principal of, or premium, if any, or interest, if any, on the Notes payable
in cash shall be considered paid on the date it is due if the Trustee or Paying
Agent (other than the Company or an Affiliate of the Company) holds at 12:00 p.m.
(noon) New York, New York
time on that date U.S. Legal Tender designated for and sufficient to pay the
installment in full.  The portion of an
installment of interest, if any, on the Notes payable as PIK Interest on any
Interest Payment Date shall be considered paid on such date if on such date (1) to
the extent such PIK Interest is paid by issuance of additional Notes constituting
PIK Notes, PIK Notes having an aggregate principal amount equal to the PIK
Interest Amount with respect to such Interest Payment Date for such Notes have
been executed and delivered, together with an Authentication Order in
accordance with Section 2.02, to the Trustee for authentication and
delivery to the Holders of such Notes in accordance with the terms of this
Indenture and (2) to the extent such PIK Interest is paid by increasing
the principal amount of Global Notes previously authenticated hereunder, the
Company has directed the Trustee in writing to increase the principal amount of
such Global Notes previously authenticated by the PIK Interest Amount with
respect to such Interest Payment Date for such Notes.  The portion of any installment of interest on
Notes payable as PIK Interest that is not paid on the date it is due shall
thenceforth be payable solely in cash.

 

(c)           Not less than
five (5) Business Days prior to each Interest Payment Date, so long as
such Interest Payment Date is prior to Maturity, the Company shall be entitled
to deliver a notice to the Trustee specifying (i) that the Company has
elected, so long as such Interest Payment Date is prior to Maturity, not to pay
the entire amount of interest due on such Interest Payment Date in cash, (ii) the
respective aggregate amounts of interest to be paid in cash and as PIK Interest
as determined in accordance with Section 4.01(d) and (iii) the
respective aggregate amounts of PIK Interest to be paid through increases in
the aggregate principal amount of Global Notes previously authenticated
hereunder or through the issuance of additional Notes constituting PIK
Notes.  If the Company does not deliver
such notice with respect to any Interest Payment Date within the time period
specified in the preceding sentence, the Company shall be deemed to have
elected to pay the entire amount of interest due on such Interest Payment Date
in cash.  On the relevant Interest
Payment Date for any Note as to which such notice has been timely given, so
long as such Interest Payment Date is prior to Maturity, the Trustee 

 

56

 

shall
record increases in the Global Notes or authenticate and deliver additional
Notes constituting PIK Notes, as appropriate, in an aggregate principal amount
equal to the PIK Interest Amount with respect to such Interest Payment Date for
such Notes.  The Company shall deliver an
Authentication Order to the Trustee in accordance with Section 2.02
upon issuance of PIK Notes in payment of PIK Interest.

 

(d)           Interest shall
accrue on the principal amount of any outstanding Notes at a rate of 13% per
annum and be payable solely in cash; provided, however, that, if
with respect to any Interest Payment Date that occurs prior to Maturity of any
Notes, the Company has duly elected pursuant to Section 4.01(c) not
to pay the entire installment of interest due on such Interest Payment Date in
cash:

 

(1)                   the interest on such Notes that is due on
such Interest Payment Date shall be deemed to have accrued since the next
preceding Interest Payment Date (or, if such Interest Payment Date is the first
Interest Payment Date in respect of such Notes, the issue date therefor) at a
rate of 15% per annum, whether or not the Company duly pays on such Interest
Payment Date such installment of interest due on such Interest Payment Date;
and

 

(2)                   if (but only if) the Company pays on such
Interest Payment Date the entire installment of interest on such Notes due on
such Interest Payment Date, the portion of such installment equal to the PIK
Interest Amount with respect to such Interest Payment Date (i.e., the portion equal to 7/15 of the aggregate amount
thereof) shall be payable by issuance of PIK Notes in accordance with the
fourth paragraph of Section 2.02 and the remainder of such
installment shall be payable in cash.

 

(e)           The Company
shall pay interest on overdue principal at 15% per annum, and it shall pay
interest on overdue installments of interest at the same rate to the extent
lawful.

 

Notwithstanding anything to the contrary
contained in this Indenture, the Company may, to the extent it is required to
do so by law, deduct or withhold income or other similar taxes imposed by the
United States of America from principal or interest payments hereunder.

 

SECTION 4.02                       Maintenance of
Registrar and Paying Agent.

 

The Company shall maintain a Registrar and
Paying Agent required under Section 2.03.  The Company shall give prior written notice
to the Trustee and the Holders of the location, and any change in the location,
of the Registrar and Paying Agent.  If at
any time the Company shall fail to maintain a Registrar or Paying Agent or
shall fail to furnish the Trustee with the address thereof, such presentations
and surrenders may be made or served at the Corporate Trust Office and the
Company hereby appoints the Trustee as its agent to receive all such
presentations and surrenders.

 

57

 

SECTION 4.03                       Corporate
Existence.

 

Except as otherwise permitted by Articles
Four, Five and Ten,
the Company shall do or cause to be done, at its own cost and expense, all
things necessary to preserve and keep in full force and effect its corporate
existence and the limited liability company, partnership or corporate existence
of each of its Restricted Subsidiaries in accordance with the respective
organizational documents of the Company and each such Restricted Subsidiary, as
the case may be, and the material rights (charter and statutory) and franchises
of the Company and each such Restricted Subsidiary; provided,
however, that the Company shall not be
required to preserve, with respect to itself, any material right or franchise
and, with respect to any of its Restricted Subsidiaries, any such existence,
material right or franchise, if the Board of Directors of the Company shall
determine in good faith that the preservation thereof is no longer desirable in
the conduct of the business of the Company and its Restricted Subsidiaries,
taken as a whole.

 

SECTION 4.04                       Payment of
Taxes and Other Claims.

 

The Company shall pay or discharge or cause
to be paid or discharged, before the same shall become delinquent, (a) all
material taxes, assessments and governmental charges (including withholding
taxes and any penalties, interest and additions to taxes) levied or imposed
upon it or any of its Restricted Subsidiaries or its properties or any of its
Restricted Subsidiaries’ properties and (b) all material lawful claims for
labor, materials and supplies that, if unpaid, might by law become a Lien upon
its properties or any of its Restricted Subsidiaries’ properties; provided, however,
that the Company shall not be required to pay or discharge or cause to be paid
or discharged any such tax, assessment, charge or claim whose amount,
applicability or validity is being or shall be contested in good faith by
appropriate proceedings properly instituted and diligently conducted for which
adequate reserves, to the extent required under GAAP, have been taken.

 

SECTION 4.05                       Maintenance of
Properties and Insurance.

 

(a)           The Company
shall, and shall cause each of its Restricted Subsidiaries to, maintain its
properties (including by the repair or replacement thereof) in good working
order and condition (including by the repair or replacement thereof) in all
material respects (subject to ordinary wear and tear); provided, however,
that, subject to Section 4.23, nothing in this Section 4.05
shall prevent the Company or any of its Restricted Subsidiaries from
discontinuing the operation and maintenance of any of its properties, or disposing
of them, if such discontinuance or disposal is, in the good faith judgment of
the Board of Directors of the Company, desirable in the conduct of the business
of the Company and its Restricted Subsidiaries, taken as a whole.

 

(b)           The Company
shall maintain insurance (including appropriate self-insurance) against loss or
damage of the kinds that, in the good faith judgment of the Company, are
adequate and appropriate for the conduct of the business of the Company and its
Restricted Subsidiaries in a prudent manner, with reputable insurers or with
the government of the United States of America or an agency or instrumentality
thereof.

 

58

 

(c)           The Company
shall, and shall cause each of its Restricted Subsidiaries to, cause the
Collateral Agent to be named as an additional insured and loss payee (as
applicable) with respect to all insurance maintained by the Company or any
Restricted Subsidiary thereof on the Note Collateral.  The Company shall, and shall cause each of
its Restricted Subsidiaries to, furnish to the Collateral Agent information
relating to its property and liability insurance carriers consisting of (i) names
of carriers, (ii) policy amounts, (iii) deductibles, (iv) such
other information as is customarily contained in “binders” for such insurance
and (v) such other information as may be reasonably requested by Holders
of at least 25% in aggregate principal amount of the Notes then outstanding
voting as a single class.

 

SECTION 4.06                       Compliance Certificate;
Notice of Default.

 

(a)           The Company and
each Guarantor shall deliver to the Trustee, within 90 days after the end of
each calendar year, an Officers’ Certificate stating that a review of the
activities of the Company and its Restricted Subsidiaries during the preceding
calendar year has been made under the supervision of the signing Officers (one
of whom shall be the principal executive officer, principal financial officer
or principal accounting officer) with a view to determining whether they have
kept, observed, performed and fulfilled their obligations under this Indenture
and further stating, as to each such Officer signing such certificate, that to
the best of such Officer’s actual knowledge the Company and its Restricted
Subsidiaries during such preceding calendar year have kept, observed, performed
and fulfilled each and every condition and covenant under this Indenture and no
Default or Event of Default occurred during such year and at the date of such
certificate there is no Default or Event of Default that has occurred and is
continuing or, if such signers do know of such Default or Event of Default, the
certificate shall describe the Default or Event of Default and its status with
particularity.

 

(b)           The Company
shall, so long as any Notes are outstanding, upon any Officer of the Company
becoming aware of any Default or Event of Default, deliver to the Trustee and
Collateral Agent an Officers’ Certificate specifying such Default or Event of
Default within 10 Business Days of such Officer becoming aware of such
occurrence.

 

SECTION 4.07                       Compliance with
Laws.

 

The Company shall, and shall cause each of
its Restricted Subsidiaries to, comply with all applicable statutes, rules,
regulations, orders and restrictions of the United States of America, all
states and municipalities thereof, and of any governmental department,
commission, board, regulatory authority, bureau, agency and instrumentality of
the foregoing, in respect of the conduct of its businesses and the ownership of
its properties, except for such noncompliances as are not in the aggregate
reasonably likely to have a material adverse effect on the financial condition
or results of operations of the Company and its Restricted Subsidiaries, taken
as a whole, or the ability of the Company to perform its material obligations
hereunder.

 

59

 

SECTION 4.08                       Reports to
Holders.

 

Whether or not required by the rules and
regulations of the SEC, so long as any Notes are outstanding, the Company will
furnish the Holders of the Notes, with a copy to the Trustee:

 

(a)           all quarterly
and annual financial information that would be required to be contained in a
filing with the SEC on Forms 10-Q and 10-K if the Company were required to file
such Forms, including a “Management’s Discussion and Analysis of Financial
Condition and Results of Operations” that describes the financial condition and
results of operations of the Company and its consolidated Subsidiaries (showing
in reasonable detail, either on the face of the financial statements or in the
footnotes thereto and in “Management’s Discussion and Analysis of Financial
Condition and Results of Operations”, the financial condition and results of
operations of the Company and its Restricted Subsidiaries separate from the
financial condition and results of operations of the Unrestricted Subsidiaries
of the Company, if any), and, with respect to the annual information only, a
report thereon by the Company’s certified independent accountants; and

 

(b)           all current reports
that would be required to be filed with the SEC on Form 8-K if the Company
were required to file such reports,

 

in each case, within the time periods
required for filing such forms and reports as specified in the SEC’s rules and
regulations.

 

In addition, following the consummation of
the Exchange Offer contemplated by the Registration Rights Agreement relating
to the Initial Notes issued in connection with the Offering, whether or not
required by the rules and regulations of the SEC, the Company will file a
copy of all such information and reports with the SEC for public availability
within the time periods specified in the SEC’s rules and regulations
(unless the SEC will not accept such a filing) and make such information
available to securities analysts and prospective investors upon request.  In addition, the Company has agreed that, if
the Company is not subject to Section 13 or 15(d) of the Exchange
Act, it will furnish to the Holders and prospective purchasers of the Notes
designated by a Holder, upon their request, the information required to be
delivered pursuant to Rule 144A(d)(4) under the Securities Act.

 

Delivery of such reports, information and
documents to the Trustee is for informational purposes only and the Trustee’s
receipt of such shall not constitute constructive notice of any information
contained therein or determinable from information contained therein, including
the Company’s compliance with any of its covenants hereunder (as to which the
Trustee is entitled to rely exclusively on Officers’ Certificates of the
Company).

 

The Company shall be deemed to have furnished
any such information, report or other document to the Holders if the Company
shall have made such information, report or other document available on the
Electronic Data Gathering, Analysis and Retrieval System of the SEC (or any
successor system) available at www.sec.gov or any successor SEC website for
such filings or, if the Company is no longer required to file with the SEC, on
the Company’s website, 

 

60

 

in each case except with
respect to the information required to be furnished under the last sentence of
the second paragraph of this Section 4.08.

 

SECTION 4.09                       Waiver of Stay,
Extension or Usury Laws.

 

The Company and each of the Guarantors
covenants (to the extent that it may lawfully do so) that it shall not at any
time insist upon, plead, or in any manner whatsoever claim or take the benefit
or advantage of, any stay or extension law or any usury law or other law that
would prohibit or forgive the Company and each of the Guarantors from paying
all or any portion of the principal of, premium, if any, or interest on the
Notes as contemplated herein, wherever enacted, now or at any time hereafter in
force, or which may affect the covenants or the performance of this Indenture;
and (to the extent that it may lawfully do so) the Company and each of the
Guarantors hereby expressly waives all benefit or advantage of any such law,
and covenants that it shall not hinder, delay or impede the execution of any
power herein granted to the Trustee, but shall suffer and permit the execution
of every such power as though no such law had been enacted.

 

SECTION 4.10                       Limitation on
Restricted Payments.

 

The Company will not, and will not cause or
permit any of its Restricted Subsidiaries to, directly or indirectly:

 

(a)           declare or pay
any dividend or make any other payment or distribution on account of the
Company’s or any of its Restricted Subsidiaries’ Equity Interests (including
any payment in connection with any merger or consolidation involving the
Company or any of its Restricted Subsidiaries) or to the direct or indirect
holders of the Company’s or any of its Restricted Subsidiaries’ Equity
Interests in their capacity as such (other than dividends, payments or
distributions payable in Equity Interests (other than Disqualified Stock) of
the Company and other dividends, payments or distributions payable to the
Company or another Restricted Subsidiary of the Company);

 

(b)           purchase, redeem
or otherwise acquire or retire for value (including in connection with any
merger or consolidation involving the Company) any Equity Interests of the
Company or any direct or indirect parent of the Company other than those Equity
Interests owned by the Company or any Restricted Subsidiary of the Company;

 

(c)           make any
payment on or with respect to, or purchase, redeem, repurchase, defease or
otherwise acquire or retire for value, any Indebtedness of the Company or any
Guarantor that is contractually subordinated in right of payment to the Notes
or any Note Guarantee (excluding any Intercompany Debt between or among the
Company and any of the Guarantors), except a payment of interest or principal
at the Stated Maturity thereof; or

 

(d)           make any
Restricted Investment;

 

(all such payments and other actions set forth in these clauses (a) through
(d) above being collectively referred to as “Restricted Payments”),
unless, at the time of and after giving effect to such Restricted Payment:

 

61

 

(1)           no Default or Event of Default has occurred and is
continuing or would occur as a consequence of such Restricted Payment;

 

(2)           the Company would, at the time of such Restricted
Payment and after giving pro forma effect thereto as if such Restricted Payment
had been made at the beginning of the applicable four-quarter period, have been
permitted to incur at least $1.00 of additional Indebtedness pursuant to the
Fixed Charge Coverage Ratio test set forth in the first paragraph of Section 4.12;
and

 

(3)           such Restricted Payment, together with the aggregate
amount of all other Restricted Payments made by the Company and its Restricted
Subsidiaries since the Issue Date (excluding Restricted Payments permitted by clauses
(2), (3), (4), (5) and (6) of the
next succeeding paragraph of this Section 4.10), is less than the
sum, without duplication, of:

 

(i)            50% of the Consolidated Net Income of the Company
for the period (taken as one accounting period) from the beginning of the first
fiscal quarter commencing after the Issue Date to the end of the Company’s most
recently ended fiscal quarter for which internal financial statements are
available at the time of such Restricted Payment (or, if such Consolidated Net
Income for such period is a deficit, less 100% of such deficit); plus

 

(ii)           100% of the aggregate net proceeds, including cash
and the Fair Market Value of the property other than cash, received by the
Company since the Issue Date as a contribution to its common equity capital or
from the issue or sale of Equity Interests of the Company (other than
Disqualified Stock) or from the issue or sale of convertible or exchangeable
Disqualified Stock or convertible or exchangeable debt securities of the
Company that have been converted into or exchanged for such Equity Interests
(other than Equity Interests (or Disqualified Stock or debt securities) sold to
a Subsidiary of the Company); provided, however, that the Company
may not include the net cash proceeds to the extent that any such common equity
capital or Equity Interests are repurchased, redeemed or otherwise acquired or
retired pursuant to clauses (2) and (5) of the next
succeeding paragraph of this Section 4.10; plus

 

(iii)          to the extent that any Restricted Investment that
was made after the Issue Date is sold for cash or otherwise liquidated or
repaid for cash, the lesser of (A) the cash return of capital with respect
to such Restricted Investment (less the cost of disposition, if any) and (B) the
initial amount of the Restricted Investment; plus

 

(iv)          to the extent that any Unrestricted Subsidiary of
the Company designated as such after the Issue Date is redesignated as a
Restricted Subsidiary after the Issue Date, the lesser of (A) the Fair
Market Value of the Company’s Investment in such Subsidiary as of the 

 

62

 

date of such redesignation or (B) such Fair Market Value as of the
date on which such Subsidiary was originally designated as an Unrestricted
Subsidiary after the Issue Date; plus

 

(v)           50% of any dividends or distributions received by
the Company or a Wholly-Owned Restricted Subsidiary of the Company that is a
Guarantor after the Issue Date from an Unrestricted Subsidiary of the Company,
to the extent that such dividends or distributions were not otherwise included
in Consolidated Net Income of the Company for such period.

 

In the case of clause (3)(ii) above,
any net cash proceeds from issuances and sales of Capital Stock of the Company
financed directly or indirectly using funds borrowed from the Company or any
Subsidiary of the Company shall be excluded until and to the extent such
borrowing is repaid.

 

Notwithstanding the foregoing, the provisions
set forth in the immediately preceding paragraph do not prohibit:

 

(1)           the payment, by
the Company or any Restricted Subsidiary, of any dividend or distribution or
the consummation of any redemption within 60 days after the date of declaration
of the dividend or distribution or giving of the redemption notice, as the case
may be, if at the date of declaration or notice, the dividend, distribution or
redemption payment would have complied with the provisions of this Indenture;

 

(2)           so long as no
Default has occurred and is continuing or would result therefrom, the making of
any Restricted Payment in exchange for, or out of the net cash proceeds of the
substantially concurrent sale (other than to a Subsidiary of the Company) of,
Equity Interests of the Company (other than Disqualified Stock) or from the
substantially concurrent contribution of common equity capital to the Company; provided
that the amount of any such net cash proceeds that are utilized for any such
Restricted Payment will be excluded from clause (3)(ii) of the preceding
paragraph;

 

(3)           so long as no
Default has occurred and is continuing or would result therefrom, the making of
any payment on or with respect to, or the defeasance, redemption, repurchase,
retirement or other acquisition or retirement for value of, Indebtedness of the
Company or any Restricted Subsidiary that is contractually subordinated in
right of payment to the Notes or to any Note Guarantee with, in exchange for,
by conversion into or out of the net cash proceeds from a substantially
concurrent incurrence of, or in exchange for, Permitted Refinancing
Indebtedness;

 

(4)           the payment of
any dividend (or, in the case of any partnership or limited liability company,
any similar distribution) by a Restricted Subsidiary of the Company to the
holders of its Equity Interests on a pro  rata basis;

 

63

 

(5)           so long as no
Default has occurred and is continuing or would result therefrom, the
repurchase, redemption or other acquisition or retirement for value of any
Equity Interests of the Company or any Restricted Subsidiary of the Company
held by any current or former officer, director, employee or consultant of the
Company or any of its Restricted Subsidiaries at no more than Fair Market
Value; provided that (x) the excess of (i) the aggregate price paid
after the Issue Date for all such repurchased, redeemed, acquired or retired
Equity Interests over (ii) the aggregate net cash proceeds received by the
Company after the Issue Date from such Persons from the issuance of or equity
contributions with respect to Equity Interests of the Company pursuant to any
equity subscription agreement, stock option agreement, shareholders’ or members’
agreement or similar agreement, plan or arrangement may not exceed $5,000,000
and (y) the excess of (i) the aggregate price paid after the Issue
Date in any calendar year for such Equity Interests over (ii) the
aggregate such net cash proceeds so received by the Company in such calendar
year may not exceed $1,000,000 in the aggregate; provided  further
that the amount of any such net cash proceeds that are utilized for such Restricted
Payment will be excluded from clause (3)(ii) of the preceding paragraph;

 

(6)           the repurchase
of Equity Interests deemed to occur upon the cashless exercise of stock options
to the extent such Equity Interests represent a portion of the exercise price
of those stock options; provided, that no proceeds in respect of the
issuance of such Equity Interests shall be deemed to have been received for the
purposes of clause (3)(ii) of the preceding paragraph;

 

(7)           so long as no
Default has occurred and is continuing or would result therefrom, the
declaration and payment of regularly scheduled or accrued dividends to holders
of any class or series of Disqualified Stock of the Company or any Restricted
Subsidiary of the Company issued on or after the Issue Date in accordance with
the Fixed Charge Coverage Ratio test set forth in the first sentence of Section 4.12;

 

(8)           so long as no
Default has occurred and is continuing or would result therefrom, the making of
any other Restricted Payment which, together with all other Restricted Payments
made pursuant to this clause (8) since the Issue Date, does not exceed
$5,000,000;

 

(9)           the repurchase
or redemption of preferred stock purchase rights issued in connection with any
stockholders rights plan of the Company at an amount not to exceed $0.01 per
right or $100,000 in the aggregate; and

 

(10)         the making of
any distributions required to be made by the Company on or after the Issue Date
pursuant to the Plan and the Confirmation Order.

 

The amount of all Restricted Payments (other
than cash) will be the Fair Market Value on the date of the Restricted Payment
of the asset(s) or securities proposed to be transferred or 

 

64

 

issued by the Company or
such Restricted Subsidiary, as the case may be, pursuant to the Restricted
Payment.  The Fair Market Value of any
assets or securities that are required to be valued by this Section 4.10
will be determined by the Board of Directors of the Company, whose resolution
with respect thereto will be delivered to the Trustee.  In the case of a determination of Fair Market
Value in excess of $10,000,000,
such Board of Directors’ determination must be based upon an opinion or
appraisal issued by an accounting, appraisal or investment banking firm of
recognized national standing.  In
determining whether any Restricted Payment is permitted by this Section 4.10,
the Company may allocate all or any portion of such Restricted Payment among
the categories described in clauses (1)  through
(10) of the immediately preceding paragraph or among such categories and
the types of Restricted Payments described in the first paragraph of this Section 4.10;
provided that at the time of such
allocation, all such Restricted Payments, or allocated portions thereof, would
be permitted under the various provisions of this Section 4.10.

 

SECTION 4.11                       Limitations on
Transactions with Affiliates.

 

The Company will not, and will not permit any
of its Restricted Subsidiaries to, make any payment to, or sell, lease, transfer
or otherwise dispose of any of its properties or assets to, or purchase any
property or assets from, or enter into or make or amend any transaction,
contract, agreement, understanding, loan, advance or guarantee with, or for the
benefit of, any Affiliate of the Company or any Restricted Subsidiary (each, an
“Affiliate Transaction”), unless:

 

(a)           the Affiliate
Transaction is on terms no less favorable to the Company or the relevant
Restricted Subsidiary than those that could have been obtained in a comparable
transaction by the Company or such Restricted Subsidiary on an arm’s length
basis with an unrelated Person; and

 

(b)           the Company
obtains and delivers to the Trustee:

 

(1)              with respect to any Affiliate Transaction or series
of related Affiliate Transactions involving aggregate consideration in excess
of $5,000,000, a resolution of its Board of Directors set forth in an Officers’
Certificate certifying that such Affiliate Transaction complies with this Section 4.11
and that such Affiliate Transaction has been approved by a majority of the
disinterested members of its Board of Directors; and

 

(2)              with respect to any Affiliate Transaction or series
of related Affiliate Transactions involving aggregate consideration in excess
of $10,000,000, an opinion as to the fairness to the Company or such Restricted
Subsidiary of such Affiliate Transaction from a financial point of view issued
by an accounting, appraisal or investment banking firm selected by the Company
or such Restricted Subsidiary, as applicable, of recognized national standing
with experience in appraising the terms and conditions of the type of
transaction or series of related transactions for which such opinion is
required.

 

The following items will not be deemed to be
Affiliate Transactions and, therefore, will not be subject to the provisions of
the prior paragraph:

 

65

 

(1)           any employment
agreement, collective bargaining agreement, employee benefit plan (including
the Management Incentive Plan and any vacation plan, health and life insurance
plan, deferred compensation plan, retirement or savings plan or stock option,
stock ownership or similar plan), officer and director indemnification
agreement or any similar arrangement entered into by the Company or any of its
Restricted Subsidiaries in the ordinary course of business, and the payment or
issuance of securities pursuant to any such agreement, plan or arrangement;

 

(2)           the payment of
compensation (including awards or grants in cash, securities or other payments)
for the personal services of, and expense reimbursement and indemnity provided
on behalf of, officers, directors (including the payment of, or an agreement
providing for the payment of, reasonable directors’ fees), consultants and
employees of the Company or any of its Restricted Subsidiaries, in each case in
the ordinary course of business;

 

(3)           to the extent
permitted by applicable law, loans or advances to employees in the ordinary
course of business for bona fide business purposes and not to exceed $250,000
in the aggregate at any time outstanding;

 

(4)           transactions
between or among the Company and/or its Restricted Subsidiaries;

 

(5)           transactions
pursuant to agreements or arrangements in effect on the Issue Date, or any
amendment, modification or supplement thereto or replacement thereof, so long
as such agreement or arrangement, as so amended, modified, supplemented or
replaced, taken as a whole, is not materially less favorable, taken as a whole,
to the Holders of the Notes than the original agreement or arrangement in
existence on the Issue Date;

 

(6)           any issuance of
Equity Interests (other than Disqualified Stock) of the Company to Affiliates
of the Company; and

 

(7)           Restricted
Payments that do not violate Section 4.10.

 

	
  SECTION 4.12

  	
  Incurrence of Indebtedness
  and Issuance of Disqualified Stock, Preferred Stock and Incentive Interests.

  

 

The Company will not, and will not permit any
of its Restricted Subsidiaries to, directly or indirectly, create, incur,
issue, assume, guarantee or otherwise become directly or indirectly liable,
contingently or otherwise, with respect to (collectively, “incur”) any
Indebtedness, and the Company will not issue any shares of Disqualified Stock
or preferred stock or warrants, options or other rights to purchase Capital
Stock (“Incentive Interests”) and will not permit any of its Restricted
Subsidiaries to issue any shares of Disqualified Stock or preferred stock or
any Incentive Interests; provided, however, that (x) the Company or any
Guarantor may incur Indebtedness or the Company may issue Disqualified Stock or
preferred stock, if the Fixed Charge Coverage Ratio for the Company’s most
recently ended four full fiscal quarters for which internal financial
statements are available immediately preceding the date on which such
additional Indebtedness is incurred or such Disqualified Stock or preferred
stock is issued would 

 

66

 

have been at least 2.0 to 1 determined on a pro forma
basis (including a pro forma application of the net proceeds therefrom), as if
such additional Indebtedness had been incurred or Disqualified Stock or
preferred stock had been issued, as the case may be, at the beginning of such
four-quarter period and (y) the Company may issue Incentive Interests not
constituting Indebtedness, Disqualified Stock or preferred stock that are
granted subject to the Management Incentive Plan.

 

The first paragraph of this Section 4.12 will not prohibit the
incurrence of any of the following items of Indebtedness (collectively, “Permitted Debt”):

 

(1)           Indebtedness
incurred (a) prior to the ABL Facility Trigger Date under the ABL Facility
in an aggregate principal amount not exceeding $23,000,000 at any time
outstanding and (b) under the Credit Facilities (including the ABL
Facility) in an aggregate principal amount not exceeding the Credit Facility
Amount at any time outstanding and, in each case, any related Guarantees;

 

(2)           Indebtedness
represented by the Notes issued on the Issue Date and Indebtedness represented
by Exchange Notes issued pursuant to a Registration Rights Agreement and, in
each case, the related Note Guarantees;

 

(3)           Indebtedness
represented by Additional Notes and the related Note Guarantees issued upon
original issue at any time after the Issue Date in aggregate principal amount
not to exceed $50,000,000; provided, however, that, prior to the
original issuance of any Additional Notes, (i) each of the Mortgages shall
have been amended to increase the maximum principal amount of Note Obligations
secured thereby to an amount at least equal to the aggregate principal amount
of Notes to be outstanding immediately after such issuance plus the maximum
principal amount of PIK Notes issuable in respect thereof assuming PIK Notes
are issued on each Interest Payment Date on or after the date of such issuance
through the Maturity Date; and (ii) the title policies with respect to
each of the Mortgages shall have been amended to increase the policy limits
thereunder (pro rata in accordance with then existing policy limits) to an
aggregate amount equal to the aggregate principal amount of Notes to be
outstanding immediately after such issuance;

 

(4)           the incurrence
by the Company or any of its Restricted Subsidiaries of Indebtedness (including
Indebtedness represented by Capital Lease Obligations, mortgage financings or
purchase money obligations) incurred for the purpose of financing all or any
part of the purchase price or cost of design, development, construction,
installation or improvement of property (real or personal), plant or equipment
used in a Permitted Business of the Company or such Restricted Subsidiary
(including through the direct acquisition of such assets or the acquisition of
Equity Interests of the Person owning such assets), in an aggregate principal
amount, including all Permitted Refinancing Indebtedness incurred to refund,
refinance or replace any Indebtedness incurred pursuant to this clause (4),
not to exceed $5,000,000 at any time outstanding;

 

(5)           the incurrence
by the Company or any of its Restricted Subsidiaries of Permitted Refinancing
Indebtedness in exchange for, or the net proceeds of which are used to extend,
renew, refund, refinance, replace, defease or discharge, Indebtedness 

 

67

 

(other
than Intercompany Debt) that was permitted by this Indenture to be incurred
under the first paragraph of this Section 4.12, this clause (5) or
clauses (2), (3) or (10) of this paragraph;

 

(6)           the incurrence
by the Company or any of its Restricted Subsidiaries of Intercompany Debt; provided,
however, that:

 

(a)           if the Company
or any Guarantor is the obligor on such Intercompany Debt and the payee is not
the Company or a Guarantor, such Intercompany Debt must be (i) permitted
as a Permitted Investment described in clause (1)(b) of the
definition thereof and (ii) expressly subordinated to the prior payment in
full in cash of all Obligations then due with respect to the Notes, in the case
of the Company, or the Note Guarantee, in the case of a Guarantor; and

 

(b)           (i) any
subsequent issuance or transfer of Equity Interests that results in any such
Intercompany Debt being held by a Person other than the Company or a Restricted
Subsidiary of the Company and (ii) any sale or other transfer of any such
Intercompany Debt to a Person that is not any of the Company, a Guarantor or,
in the case where the payor on such Intercompany Debt is not the Company or a
Guarantor, any Restricted Subsidiary of the Company will be deemed, in each
case, to constitute an incurrence of such Intercompany Debt by the Company or
such Restricted Subsidiary, as the case may be, that was not permitted by this clause
(6);

 

(7)           the issuance by
any of the Company’s Restricted Subsidiaries to the Company or to any other
Restricted Subsidiaries of shares of Disqualified Stock or preferred stock; provided,
however, that if the issuer of such shares of Disqualified Stock or
preferred stock is a Restricted Subsidiary of the Company that is not a
Guarantor and the purchaser of such shares is the Company or a Guarantor, such
Investment must be permitted as a Permitted Investment described in clause
(1)(b) of the definition thereof and:

 

(a)           any subsequent
issuance or transfer of Equity Interests that results in any such Disqualified
Stock or preferred stock being held by a Person other than the Company or a
Restricted Subsidiary of the Company; and

 

(b)           any sale or
other transfer of any such Disqualified Stock or preferred stock to a Person
that is not any of the Company, a Guarantor or, in the case where the issuer of
such Disqualified Stock or preferred stock is not a Guarantor, any Restricted
Subsidiary of the Company,

 

will
be deemed, in each case, to constitute an issuance of such Disqualified Stock
or preferred stock by such Restricted Subsidiary that was not permitted by this
clause (7);

 

(8)           the incurrence
by the Company or any of its Restricted Subsidiaries of Hedging Obligations in
the ordinary course of business;

 

68

 

(9)           the Guarantee
by the Company or any of the Guarantors of Indebtedness of the Company or any
of its Restricted Subsidiaries that was permitted to be incurred by another
provision of this Section 4.12; provided that if the
Indebtedness being guaranteed is subordinated in right of payment to the Notes
or a Note Guarantee, then such Guarantee shall be subordinated in right of
payment to the same extent as the Indebtedness Guaranteed;

 

(10)         Indebtedness
represented by PIK Notes issued on any Interest Payment Date pursuant to the
fourth paragraph of Section 2.02 in payment of the portion of the
aggregate installment of interest due and payable on any Notes on such Interest
Payment Date constituting the PIK Interest Amount with respect to such Interest
Payment Date for such Notes;

 

(11)         the incurrence
by the Company or any Guarantor of Indebtedness to the extent that the net
proceeds thereof are promptly (A) used to purchase Notes tendered in
connection with a Change of Control Offer pursuant to Section 4.15
or (B) deposited to defease or to satisfy and discharge the Notes pursuant
to Article Eight;

 

(12)         the incurrence
by the Company or any of its Restricted Subsidiaries of Indebtedness in respect
of standby and other letters of credit, bankers’ acceptances, surety,
performance, appeal or similar bonds, completion guarantees or similar
instruments issued in the ordinary course and not supporting obligations for
borrowed money, including in respect of workers’ compensation claims and
self-insurance obligations;

 

(13)         the incurrence
by the Company or any of its Restricted Subsidiaries of Indebtedness arising
from the honoring by a bank or other financial institution of a check, draft or
similar instrument inadvertently (except in the case of daylight overdrafts)
drawn against insufficient funds; provided, however, that such
Indebtedness is extinguished within five (5) Business Days of incurrence;

 

(14)         Indebtedness
represented by the Aurora West Kiewit Note issued on the Issue Date;

 

(15)         the incurrence
of Indebtedness arising from agreements of the Company or a Guarantor providing
indemnification, adjustment of purchase price, earn outs or similar
obligations, in each case, incurred in connection with the disposition or
acquisition of any business, assets or a Guarantor in accordance with the terms
of this Indenture, other than Indebtedness or guarantees of Indebtedness
incurred by any Person acquiring all or any portion of such business, assets or
Guarantor for the purpose of financing such acquisition, in an aggregate
principal amount at any time outstanding, including all Permitted Refinancing
Indebtedness incurred to renew, refund, refinance, replace, defease or
discharge any Indebtedness incurred pursuant to this clause (15), not to
exceed $5,000,000; provided, however, in the case of any disposition,
the maximum principal amount of such Indebtedness does not exceed the gross
cash proceeds actually received by the Company or a Guarantor in connection
with such disposition;

 

69

 

(16)         Guarantees in
the ordinary course of business of the obligations not constituting
Indebtedness of suppliers, customers, distributors, franchisers and licensees;

 

(17)         endorsement of
negotiable instruments for deposit or collection or similar transactions in the
ordinary course of business;

 

(18)         to the extent
constituting Indebtedness, indemnification obligations and other similar
obligations (including advancement of expenses) of the Company or any of its
Subsidiaries in favor of directors, officers, employees, consultants or agents
of the Company or any of its Subsidiaries extended in the ordinary course of
business in an aggregate principal amount not to exceed $1,000,000 at any time
outstanding;

 

(19)         Indebtedness
owing to insurance companies (or another Person engaged at the direction of the
Company or any of its Subsidiaries and any such insurance company) to finance
insurance premiums incurred in the ordinary course of business in an aggregate
principal amount not to exceed $2,000,000 at any time outstanding; and

 

(20)         additional
Indebtedness of the Company or any of its Restricted Subsidiaries (in addition
to the Indebtedness under clauses (1) through (19) above) in
an aggregate principal amount outstanding at any time, including all Permitted
Refinancing Indebtedness incurred to renew, refund, refinance, replace, defease
or discharge any Indebtedness incurred pursuant to this clause (20), not
to exceed $5,000,000.

 

The Company will not incur, and will not
permit any Guarantor to incur, any Indebtedness (including Permitted Debt) that
is contractually subordinated in right of payment to any other Indebtedness of
the Company or such Guarantor unless such Indebtedness is also contractually
subordinated in right of payment to the Notes and the applicable Note Guarantee
on substantially identical terms; provided, however, that no
Indebtedness will be deemed to be contractually subordinated in right of
payment to any other Indebtedness of the Company solely by virtue of being
unsecured or by virtue of being secured on a first or junior Lien basis.

 

For purposes of determining compliance with
this Section 4.12, in the event that
an item of proposed Indebtedness, Disqualified Stock or preferred stock meets
the criteria of more than one of the categories of Permitted Debt described in clauses
(1) through (20) above, or is entitled to be incurred pursuant to
the first paragraph of this Section 4.12,
the Company will be permitted to classify such item of Indebtedness,
Disqualified Stock or preferred stock or any portion thereof on the date of its
incurrence or issuance, and will only be required to include the amount and
type of such Indebtedness, Disqualified Stock or preferred stock in one of the
above clauses or as having been incurred or issued pursuant to the first paragraph
of this Section 4.12, although the
Company may divide and classify an item of Indebtedness, Disqualified Stock or
preferred stock in one or more of the categories of Permitted Debt described in
such clauses or as having been incurred or issued pursuant to the first
paragraph of this Section 4.12 and may
later reclassify all or a portion of such item of Indebtedness, Disqualified
Stock or preferred stock, in any manner that complies with this Section 4.12.  The accrual of interest or dividends, the
accretion of accreted value or amortization of original issue discount, the
payment of interest on any Indebtedness in the form of additional Indebtedness
with the same terms and the payment of dividends on Disqualified Stock or
preferred stock in the form of additional shares of the same 

 

70

 

class of Disqualified Stock
or preferred stock will not be deemed to be an incurrence of Indebtedness or an
issuance of Disqualified Stock or preferred stock for purposes of this Section 4.12; provided,
in each such case (other than preferred stock that is not Disqualified Stock),
that the amount of any such accrual, accretion or amortization or payment
(without duplication) is included in Fixed Charges of the Company as accrued,
accreted or amortized or paid. 
Notwithstanding any other provision of this Section 4.12,
the maximum amount of Indebtedness that the Company or any Restricted
Subsidiary may incur pursuant to this Section 4.12
shall not be deemed to be exceeded solely as a result of fluctuations in
exchange rates or currency values.

 

The amount of any Indebtedness outstanding as
of any date will be:

 

(1)           the accreted value of the Indebtedness, in the case
of any Indebtedness issued with original issue discount;

 

(2)           the principal amount of the Indebtedness, in the
case of any other Indebtedness; and

 

(3)           in respect of Indebtedness of another Person secured
by a Lien on the assets of the specified Person, the lesser of:

 

(i)            the Fair Market Value of such asset at the date of
determination; and

 

(ii)           the amount of such Indebtedness of the other Person.

 

Notwithstanding the foregoing, for purposes
of determining any particular principal amount of Indebtedness under this Section 4.12,
the principal amount of Indebtedness deemed to arise from a Guarantee of, or
obligations with respect to letters of credit supporting, or as a result of a
Lien on property securing, the principal amount of any Indebtedness otherwise
included in the determination of such particular principal amount shall not be
included.

 

SECTION 4.13                       Limitation on
Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries.

 

The Company will not, and will not permit any
of its Restricted Subsidiaries to, directly or indirectly, create or permit to
exist or become effective any consensual encumbrance or restriction on the
ability of any Restricted Subsidiary to:

 

(a)           pay dividends
or make any other distributions on its Capital Stock to the Company or any of
its Restricted Subsidiaries, or with respect to any other interest or
participation in, or measured by, its profits, or pay any Indebtedness owed to
the Company or any of its Restricted Subsidiaries;

 

(b)           make loans or
advances to the Company or any of its Restricted Subsidiaries; or

 

(c)           transfer any of
its properties or assets to the Company or any of its Restricted Subsidiaries;

 

71

 

provided, however, that the
preceding restrictions will not apply to encumbrances or restrictions existing
under or by reason of:

 

(1)                   the ABL Facility as in effect on the Issue
Date and any amendments, modifications, restatements, renewals, increases,
supplements, refundings, replacements or refinancings of such agreement; provided
that the encumbrances or restrictions in such amendments, modifications,
restatements, renewals, increases, supplements, refundings, replacement or
refinancings are not, in the good faith judgment of the Company’s Board of
Directors, materially less favorable, taken as a whole, to the Holders than
those contained in that agreement on the Issue Date;

 

(2)                   this Indenture, the Notes, the Note
Guarantees and the Collateral Documents;

 

(3)                   applicable law, rule, regulation, order,
approval, license, permit or similar restriction;

 

(4)                   (i) any instrument governing
Indebtedness or Capital Stock of a Person acquired by the Company or any of its
Restricted Subsidiaries as in effect at the time of such acquisition (except to
the extent such Indebtedness or Capital Stock was incurred in connection with
or in contemplation of such acquisition), which encumbrance or restriction is
not applicable to any Person, or the properties or assets of any Person, other
than the Person, or the property or assets of the Person, so acquired; provided
that, in the case of Indebtedness, such Indebtedness was permitted by the terms
of this Indenture to be incurred; and (ii) any amendment, modification,
renewal, replacement or refinancing thereof; provided, however,
that the encumbrances or restrictions in any such amendment, modification,
renewal, replacement or refinancing are not, in the good faith judgment of the
Company’s Board of Directors, materially less favorable, taken as a whole, to
the Holders than such encumbrances or restrictions prior to such amendment,
modification, renewal, replacement or refinancing;

 

(5)                   customary non-assignment or sub-letting
provisions in contracts, leases and licenses entered into in the ordinary
course of business;

 

(6)                   any agreement for the sale or other
disposition of all or substantially all of the Capital Stock or assets of a
Restricted Subsidiary that restricts distributions, loans or transfers by that
Restricted Subsidiary pending the sale or other disposition;

 

(7)                   Permitted Refinancing Indebtedness; provided
that the restrictions contained in the agreements governing such Permitted
Refinancing Indebtedness are not, in the good faith judgment of the Company’s
Board of Directors, materially less favorable, taken as a whole, to the Holders
than those contained in the agreements governing the Indebtedness being
refinanced, extended, renewed, refunded, refinanced, replaced, defeased or
discharged;

 

72

 

(8)                   Liens permitted to be incurred under the
provisions of Section 4.20 that limit the right of the debtor to
dispose of the assets subject to such Liens;

 

(9)                   Provisions limiting the disposition or
distribution of assets or property in joint venture agreements, asset sale
agreements, limited liability company organizational documents, sale-leaseback
agreements, stock sale agreements, stockholder agreements and other similar
agreements entered into with the approval of the Company’s Board of Directors,
which limitation is applicable only to the assets that are the subject of such
agreements;

 

(10)                 restrictions on cash or other deposits or net
worth imposed by suppliers, landlords or customers or required by insurance,
surety or bonding companies, in each case under contracts entered into in the
ordinary course of business; and

 

(11)                 other Indebtedness or Disqualified Stock,
preferred stock or Incentive Stock of Restricted Subsidiaries permitted to be
incurred subsequent to the Issue Date pursuant to the provisions of Section 4.12;
provided that the encumbrances or restrictions imposed thereby are ordinary
and customary with respect to the type of Indebtedness incurred.

 

SECTION 4.14                       Additional Note
Guarantees.

 

If (a) the Company or any of its
Restricted Subsidiaries acquires or creates or redesignates another Domestic
Subsidiary that is not an Unrestricted Subsidiary after the Issue Date or (b) any
Subsidiary of the Company that is not a Guarantor guarantees or otherwise
becomes an obligor on any Indebtedness of the Company or any Guarantor, then
the Company shall cause that newly acquired or created Domestic Subsidiary that
is not an Unrestricted Subsidiary or Subsidiary that is such an obligor, as
applicable, to, within 10 Business Days after the date on which it was acquired
or created or redesignated or becomes such an obligor, as applicable:  (1) become a Guarantor and execute and
deliver to the Trustee (i) a supplemental indenture pursuant to which such
Domestic Subsidiary that is a Restricted Subsidiary shall guarantee the Note
Obligations on the terms set forth in Article Ten
of this Indenture and (ii) a supplement to the Intercreditor Agreement and
the Security Agreement and such other Collateral Documents as may be
applicable, in the case of clause (i) or (ii) in form
reasonably satisfactory to the Trustee; (2) cause such instruments and
Uniform Commercial Code financing statements to be filed and recorded in such
jurisdictions and take such other actions as may be required by applicable law
to perfect the Note Lien created under the Security Agreement and such other
Collateral Documents, if any, on the Specified Assets and other After-Acquired
Property owned by such Subsidiary; and (3) deliver to the Trustee an
Opinion of Counsel reasonably satisfactory to the Trustee addressed to the
Trustee and covering, among other things, the authorization, execution and
delivery by such Subsidiary of such supplemental indenture and supplements to
such Collateral Documents and the validity and enforceability against such
Subsidiary of this Indenture (including the Note Guarantee of such Subsidiary)
and of such Collateral Documents and the perfection of the Note Liens purported
to be created thereby.

 

73

 

SECTION 4.15                                            Repurchase Upon
Change of Control.

 

(a)                                  Upon the
occurrence of a Change of Control, each Holder will have the right to require
the Company to repurchase all or a portion (provided that (i) unless
all of such Holder’s Notes are to be repurchased, the purchased portion of such
Holder’s Notes must be equal in principal amount to $2,000 or an integral
multiple of $1,000 in excess of $2,000 and (ii) in any event, the
unpurchased portion of such Holder’s Notes must be in a principal amount of at
least $2,000) of such Holder’s Notes pursuant to the offer described below (the
“Change of Control Offer”), at a repurchase price in cash equal to 101%
of the aggregate principal amount thereof on the date of repurchase, plus
accrued and unpaid interest, if any, to (but not including) the date of
repurchase (subject to the right of Holders of record on the relevant Record
Date to receive interest due on the relevant Interest Payment Date).

 

(b)                                 Within 30 days
following the date upon which the Change of Control occurred, the Company shall
send by registered first class mail, postage prepaid, a notice to each record
Holder as shown on the register of Holders, with a copy to the Trustee, which
notice shall govern the terms of the Change of Control Offer.  The notice to the Holders shall contain all
instructions and materials reasonably necessary to enable such Holders to
tender Notes pursuant to the Change of Control Offer.  Such notice shall state:

 

(1)                                  that the Change of Control
Offer is being made pursuant to this Section 4.15 and that all
Notes validly tendered and not validly withdrawn shall be accepted for payment
(subject to clause (ii) of the penultimate paragraph of this Section 4.15);

 

(2)                                  the repurchase price
(including the amount of accrued interest) and the repurchase date (which shall
be no earlier than thirty (30) days nor later than sixty (60) days from the
date such notice is mailed, other than as may be required by law) (the “Change
of Control Payment Date”);

 

(3)                                  that any Note not validly
tendered shall continue to accrue interest;

 

(4)                                  that, unless the Company
defaults in making payment therefor, any Note accepted for payment pursuant to
the Change of Control Offer shall cease to accrue interest on and after the
Change of Control Payment Date;

 

(5)                                  that any Holder electing to
have a Note repurchased pursuant to a Change of Control Offer shall be required
to surrender such Note, with the form entitled “Option of Holder to Elect
Purchase” on the reverse of the Note completed, to the Paying Agent at the
address specified in the notice prior to the close of business on the third
Business Day prior to the Change of Control Payment Date;

 

(6)                                  that any Holder shall be
entitled to withdraw its election if the Paying Agent receives, not later than
three (3) Business Days prior to the Change of Control Payment Date, a
telex, facsimile transmission or letter setting forth the name of the Holder,
the principal amount of the Notes the Holder delivered for 

 

74

 

repurchase and a statement that such Holder is withdrawing its election
to have such Notes repurchased;

 

(7)                                  that Holders whose Notes are
being purchased only in part shall be issued new Notes equal in principal
amount to the unpurchased portion of the Notes surrendered;

 

(8)                                  that, unless all of a Holder’s
Notes are to be purchased, the purchased portion of a Holder’s Notes must be
equal in principal amount to $2,000 or an integral multiple of $1,000 in excess
of $2,000, except that (i) if all of the Notes of a Holder are to be
purchased, the entire outstanding principal amount of Notes held by such
Holder, even if not a multiple of $1,000, shall be purchased, subject, in the
case of Global Notes, to the procedures of DTC and (ii) in any event, the
unpurchased portion of Notes purchased in part shall be in a principal amount
of at least $2,000; and

 

(9)                                  the circumstances and
relevant facts regarding such Change of Control.

 

If any of the Notes subject to the Change of
Control Offer is in the form of a Global Note, then the Company shall modify
such notice to the extent necessary to comply with the procedures of the
Depository applicable to repurchases.

 

On or before the Change of Control Payment
Date, the Company shall, to the extent lawful (i) accept for payment Notes
or portions thereof properly tendered and not validly withdrawn pursuant to the
Change of Control Offer, (ii) deposit with the Paying Agent U.S. Legal
Tender sufficient to pay the repurchase price plus accrued interest, if any, of
all Notes or portions thereof so properly tendered and not validly withdrawn
and (iii) deliver or cause to be delivered to the Trustee the Notes so
properly accepted together with an Officers’ Certificate stating the aggregate
principal amount of Notes or portions thereof being repurchased by the
Company.  The Paying Agent shall promptly
mail or pay by wire transfer to the Holders of the Notes so properly tendered
and so accepted the repurchase price for such Notes and the Company shall
promptly execute and deliver, upon receipt of an Authentication Order in
accordance with Section 2.02, and the Trustee shall promptly
authenticate and deliver to each Holder a new Note equal in principal amount to
any unpurchased portion of the Notes surrendered; provided
that such unpurchased portion, if any, must be in a principal amount of at
least $2,000.  Any Note so accepted for
repurchase will cease to accrue interest on and after the Change of Control
Payment Date.  Any Notes not so accepted
shall be promptly mailed by the Company to the Holders thereof.  For purposes of this Section 4.15,
the Trustee shall act as the Paying Agent.

 

The Company will publicly announce the
results of the Change of Control Offer on or as soon as reasonably practicable
after the Change of Control Payment Date. 
Any amounts remaining after the repurchase of Notes pursuant to a Change
of Control Offer shall be returned by the Trustee to the Company.

 

75

 

The Company shall comply with the
requirements of Rule 14e-1 under the Exchange Act and any other securities
laws and regulations thereunder to the extent such laws and regulations are
applicable in connection with the repurchase of Notes pursuant to a Change of
Control Offer.  To the extent the
provisions of any securities laws or regulations conflict with the provisions
under this Section 4.15, the Company shall comply with the
applicable securities laws and regulations and shall not be deemed to have
breached its obligations under this Section 4.15 by virtue thereof.

 

Notwithstanding the above, the Company shall
not be required to make a Change of Control Offer upon a Change of Control if (i) a
third party makes the Change of Control Offer in the manner, at the times and
otherwise in compliance with the requirements of this Section 4.15
and repurchases all Notes properly tendered and not withdrawn under such Change
of Control Offer or (ii) a notice with respect to the redemption of all
Notes has been given pursuant to Section 3.04 at any time before
the Change of Control Payment Date and the Company redeems the Notes in
accordance with such notice.

 

Notes (or portions thereof) repurchased
pursuant to a Change of Control Offer shall be cancelled and may not be
reissued.

 

SECTION 4.16                                            Limitation on
Asset Sales.

 

The Company will not, and will not permit any
of its Restricted Subsidiaries to, consummate an Asset Sale unless:

 

(a)                                  the Company or
the Restricted Subsidiary, as the case may be, receives consideration at the
time of the Asset Sale at least equal to the Fair Market Value of the assets or
Equity Interests issued or sold or otherwise disposed of;

 

(b)                                 at least 75%
(or, in the case of an Asset Sale of Specified Collateral, 100%) of the
consideration received in the Asset Sale by the Company or such Restricted Subsidiary
is in the form of cash or Cash Equivalents; provided, however,
that, for purposes of this Section 4.16, each of the following will
be deemed to be cash:

 

(1)                                  solely in the case of any
Asset Sale of assets other than Specified Collateral, any liabilities of the
Company or any Restricted Subsidiary that would otherwise be required to be
included on the Company’s consolidated balance sheet (other than contingent
liabilities and liabilities that are by their terms subordinated in right of
payment to the Notes or any Note Guarantee) that are assumed by the transferee
of any such assets pursuant to a customary novation or assignment and
assumption agreement that releases the Company or such Restricted Subsidiary
from further liability;

 

(2)                                  solely in the case of any
Asset Sale of assets other than Specified Collateral, any securities, notes or
other obligations received by the Company or any such Restricted Subsidiary
from such transferee that are converted by the Company or such Restricted
Subsidiary into cash or Cash Equivalents within 180 days of the receipt
thereof, to the extent of the cash or Cash Equivalents received in that
conversion; and

 

76

 

(3)                                  any Additional Assets
(provided, that (x) if such Asset Sale constitutes a Primary Collateral
Asset Sale, (A) to the extent the assets disposed of constitute Primary
Collateral, this clause (3) shall be limited to only Additional
Assets that simultaneously with the acquisition thereof will become Primary Collateral
or (B) to the extent the assets disposed of constitute Specified
Collateral, this clause (3) shall be limited to only Additional
Assets constituting Specified Assets that simultaneously with the acquisition
thereof will become Specified Collateral and (y) to the extent such Asset
Sale includes any Note Collateral, such Asset Sale does not occur unless such
Additional Assets become Note Collateral prior to or simultaneously with the
acquisition thereof and until and unless the provisions of Section 4.28
have otherwise been complied with respect to the Additional Assets being
received as consideration for the Asset Sale of such Note Collateral);

 

provided  further, however, that the 75%
requirement referred to in this clause (b) will
not apply to any Asset Sale that is not a Primary Collateral Asset Sale if the
cash or Cash Equivalents portion of the consideration received therefrom,
determined in accordance with subclauses (1),  (2) and (3)
above, is equal to or greater than what the after-tax proceeds would have been
had that Asset Sale complied with the aforementioned 75% limitation;

 

(c)                                  if such Asset
Sale involves the disposition of Secondary Collateral, the proceeds are applied
in accordance with the Intercreditor Agreement to the extent required therein;

 

(d)                                 in the event of
a Primary Collateral Asset Sale, the Net Proceeds corresponding to the Primary
Collateral sold shall be paid directly to the Collateral Agent for deposit into
the Collateral Account which shall become part of the Primary Collateral and be
subject to the Primary Collateral Lien in favor of the Holders and the Trustee;
and

 

(e)                                  if such Asset
Sale includes any issuance, sale or other disposition of any Equity Interests
of any Restricted Subsidiary of the Company, (1) such Asset Sale is of all
Equity Interests of such Restricted Subsidiary and (2) any Investment by
the Company or any Restricted Subsidiary of the Company in such Person existing
immediately after giving effect to such Asset Sale would have been permitted to
be made pursuant to Section 4.10 if made at such time;

 

provided, however, that, in the case of any Asset Sale
(other than a Primary Collateral Asset Sale), clauses (a) and (b)
above need not be satisfied (I) to the extent the Note Collateral to be
released consists solely of Secondary Collateral with respect to which the
required lenders under the ABL Facility have given their consent and authorized
the release of same or to the extent the Secondary Collateral to be released is
disposed of by such Credit Facility Agent on behalf of the lenders in
connection with the exercise of rights or remedies under the ABL Facility, in
each case so long as (x) the Collateral Agent is required to release its
lien thereon pursuant to the terms of the Intercreditor Agreement and (y) the
proceeds therefrom are applied in accordance with the Intercreditor Agreement
or (II) to the extent such Asset Sale results from the loss, destruction, 

 

77

 

damage, condemnation, confiscation,
requisition, seizure, forfeiture or taking of title to or use of Secondary
Collateral.

 

Within 270 days after the date the Company or
a Restricted Subsidiary of the Company actually receives any Net Proceeds from
an Asset Sale, the Company may, or may cause such Restricted Subsidiary to,
apply those Net Proceeds, at its option:

 

(1)                                  to acquire Additional Assets
(provided that (x) if such Asset Sale constitutes a Primary Collateral
Asset Sale, (A) to the extent the assets disposed of constitute Primary
Collateral, such Additional Assets shall be limited to only Additional Assets
that simultaneously with the acquisition thereof become Primary Collateral or (B) to
the extent the assets disposed of constitute Specified Collateral, such
Additional Assets shall be limited to only Additional Assets constituting
Specified Assets that simultaneously with the acquisition thereof become
Specified Collateral and (y) to the extent the assets that were the
subject of such Asset Sale includes any Note Collateral, such Additional Assets
are not acquired unless such Additional Assets become Note Collateral prior to
or simultaneously with the acquisition thereof and until and unless the
provisions of Section 4.28 have otherwise been complied with
respect to such Additional Assets);

 

(2)                                  solely in the case of Net
Proceeds from any Asset Sale other than a Primary Collateral Asset Sale, to (A) satisfy
all mandatory repayment obligations under any Credit Facilities secured by the
assets disposed of that arise by reason of such Asset Sale or (B) make a
capital expenditure; or

 

(3)                                  solely in the case of Net
Proceeds from any Asset Sale other than a Primary Collateral Asset Sale, to any
combination of the actions set forth in the foregoing clauses (1) and
(2).

 

Unless and until any Net Proceeds from a
Primary Collateral Asset Sale are finally applied as specified in the preceding
paragraph or in accordance with Section 4.19, the Company shall
cause such Net Proceeds to be held by the Collateral Agent as Collateral Monies
in the Collateral Account.  Unless and
until any Net Proceeds from an Asset Sale (other than a Primary Collateral
Asset Sale) are finally applied as specified in the preceding paragraph or in
accordance with Section 4.19, the Company shall temporarily use
such Net Proceeds to reduce revolving Indebtedness or invest such Net Proceeds
in Cash Equivalents.

 

Any Net Proceeds from Asset Sales that are
not applied as provided in the second preceding paragraph within 270 days after
the date the Company or such Restricted Subsidiary actually receives such Net
Proceeds will constitute “Excess Asset Sale Proceeds”.

 

SECTION 4.17                                            Event of Loss.

 

In the event of an Event of Loss, the Company
may, or may cause the affected Guarantor to, apply the Net Loss Proceeds from
such Event of Loss to:

 

(a)                                  the rebuilding,
repair, replacement or construction of improvements to the assets subject to
such Event of Loss so long as the rebuilt, repaired or improved property 

 

78

 

or
replacement property constitutes Additional Assets (provided that (x) such
Additional Assets shall be limited to only Additional Assets that no later than
the completion of such rebuilding, repair or improvement or the acquisition of
such replacement have become Primary Collateral; (y) to the extent the
assets subject to such Event of Loss constitute Specified Collateral, such
Additional Assets shall be limited to only Additional Assets constituting
Specified Assets that have become Specified Collateral; and (z) the
provisions of Section 4.28 have otherwise been complied with
respect to such Additional Assets no later than the completion of such
rebuilding, repair or improvement or the acquisition of such replacement);

 

(b)                                 acquire
Additional Assets (provided that (x) such Additional Assets shall be
limited to only Additional Assets that simultaneously with the acquisition
thereof become Primary Collateral; (y) to the extent the assets subject to
such Event of Loss constitute Specified Collateral, such Additional Assets
shall be limited to only Additional Assets constituting Specified Assets that
simultaneously with the acquisition thereof become Specified Collateral; and (z) such
Additional Assets are not acquired until and unless the provisions of Section 4.28
have otherwise been complied with respect to such Additional Assets); or

 

(c)                                  a combination
of the actions set forth in the foregoing clauses (a) and (b).

 

With respect to any property or asset subject
to an Event of Loss pursuant to clause (4) of the definition of “Event of Loss” that has a Fair Market Value (or
replacement cost, if greater) in excess of $1,000,000, the Company (or the
affected Guarantor, as the case may be), shall be required to receive
consideration (i) at least equal to the Fair Market Value (as evidenced by
a Board Resolution) of the assets subject to the Event of Loss and (ii) at
least 75% of which is in the form of cash or Cash Equivalents.

 

Unless and until any Net Loss Proceeds from
an Event of Loss are finally applied as specified in the first sentence of this
Section 4.17 or in accordance with Section 4.19, the
Company shall cause such Net Loss Proceeds to be held by the Collateral Agent
as Collateral Monies in the Collateral Account.

 

Any Net Loss Proceeds that are not applied as
provided in the first sentence of this Section 4.17 within the
later of (i) the date 30 days after the date the Company or Restricted
Subsidiary actually receives such Net Loss Proceeds and (ii) the date 270
days after the date of such Event of Loss will constitute “Excess Loss
Proceeds”.

 

SECTION 4.18                                            [Reserved]

 

SECTION 4.19                                            Repurchase
Offers.

 

(a)                                  When the
aggregate amount of the sum of all Excess Asset Sale Proceeds and Excess Loss
Proceeds (collectively, “Excess Proceeds”) exceeds $5,000,000 (the date of such occurrence is referred to
herein as the “Offer Trigger Date”), within
30 days thereof, the
Company will make an offer (the “Repurchase Offer”)
to all Holders to repurchase the maximum principal amount of Notes that may be
repurchased out of all such Excess Proceeds. 
The offer price in any Repurchase Offer will be equal to 100% of 

 

79

 

the
principal amount plus accrued and unpaid interest to the date of repurchase
(subject to the right of Holders of record on the relevant Record Date to
receive interest due on the relevant Interest Payment Date), and will be
payable in cash.  If any Excess Proceeds
remain after consummation of a Repurchase Offer, the Company may use those
Excess Proceeds for any purpose not otherwise prohibited by this Indenture; provided that any remaining Excess Proceeds shall
remain subject to the Note Lien.  If the
aggregate principal amount of Notes tendered into such Repurchase Offer exceeds
the amount of Excess Proceeds, the Trustee will select the Notes to be
repurchased on a pro  rata basis.  Upon completion of each Repurchase Offer, the
amount of Excess Proceeds will be reset at zero.

 

All Excess Proceeds shall, pending their
application in accordance with this Section 4.19 or the release
thereof in accordance with the provisions described under Article Twelve, (i) to the extent
constituting Collateral Monies, be held as Collateral Monies in the Collateral
Account or (ii) to the extent not constituting Collateral Monies, be
invested in Cash Equivalents or applied to temporarily reduce revolving
Indebtedness.

 

(b)                                 Within 30 days
following the date upon which the Offer Trigger Date occurred, the Company
shall send by registered first class mail, postage prepaid, a notice to each
record Holder as shown on the register of Holders, with a copy to the Trustee,
which notice shall govern the terms of the Repurchase Offer.  The notice to the Holders shall contain all
instructions and materials necessary to enable such Holders to tender Notes
pursuant to the Repurchase Offer.  Such
notice shall state:

 

(1)                                  that the
Repurchase Offer is being made pursuant to this Section 4.19 and
the amount of Excess Proceeds and that all Notes validly tendered and not
withdrawn shall be accepted for payment up to the maximum principal amount of
Notes that may be repurchased out of such Excess Proceeds;

 

(2)                                  the repurchase
price (including the amount of accrued interest) and the repurchase date (which
shall be no earlier than thirty (30) days nor later than sixty (60) days from
the date such notice is mailed, other than as may be required by law) (the “Repurchase
Offer Payment Date”);

 

(3)                                  that any Note
not tendered shall continue to accrue interest;

 

(4)                                  that, unless
the Company defaults in making payment therefor, any Note accepted for payment
pursuant to the Repurchase Offer shall cease to accrue interest on and after
the Repurchase Offer Payment Date;

 

(5)                                  that Holders
electing to have a Note purchased pursuant to a Repurchase Offer may elect to
have Notes purchased in a principal amount equal to $2,000 or integral
multiples of $1,000 in excess of $2,000 except that (i) if a Holder elects
to have all the Notes held by such Holder purchased, such Holder may elect to
have the entire outstanding principal amount of such Holder, even if not an integral
multiple of $1,000, purchased and (ii) in any event, the portion of 

 

80

 

Notes of a Holder as to which an election for purchase is not made
shall be in a principal amount of at least $2,000;

 

(6)                                  that Holders
electing to have a Note repurchased pursuant to a Repurchase Offer shall be
required to surrender the Note, with the form entitled “Option of Holder to
Elect Purchase” on the reverse of the Note completed, to the Paying Agent at
the address specified in the notice prior to the close of business on the third
Business Day prior to the Repurchase Offer Payment Date;

 

(7)                                  that any Holder
shall be entitled to withdraw its election if the Paying Agent receives, not
later than three (3) Business Days prior to the Repurchase Offer Payment
Date, a telex, facsimile transmission or letter setting forth the name of the
Holder, the principal amount of the Notes the Holder delivered for repurchase
and a statement that such Holder is withdrawing its election to have such Notes
repurchased;

 

(8)                                  that, if the
aggregate principal amount of Notes surrendered by Holders exceeds the
aggregate amount of Excess Proceeds, the Trustee shall select the Notes to be
purchased on a pro rata basis on the basis of the aggregate principal amount of
validly tendered Notes with such adjustments as may be deemed appropriate by
the Trustee so that only Notes in principal amounts of $2,000, or integral
multiples of $1,000 in excess of $2,000, shall be purchased, except that (i) if
all of the Notes of a Holder are to be purchased, the entire outstanding
principal amount of Notes held by such Holder, even if not an integral multiple
of $1,000, may be purchased, subject, in the case of Global Notes, to the
procedures of DTC and (ii) in any event the unpurchased portion of Notes
of any Holder purchased in part shall be in a principal amount of at least
$2,000;

 

(9)                                  that any Holder
whose Notes are repurchased only in part shall be issued new Notes in a
principal amount equal to the unpurchased portion of the Notes surrendered; provided
that the unpurchased portion of Notes of any Holder whose Notes are purchased
in part shall be in a principal amount of at least $2,000; and

 

(10)                            the
circumstances and relevant facts regarding such Excess Proceeds.

 

If any of the Notes subject to the Repurchase
Offer is in the form of a Global Note, then the Company shall modify such
notice to the extent necessary to comply with the procedures of the Depository
applicable to repurchases.

 

On or before the Repurchase Offer Payment
Date, the Company shall, to the extent lawful (i) accept for payment Notes
or portions thereof properly tendered and not withdrawn pursuant to the
Repurchase Offer, up to the maximum principal amount of Notes that may be
repurchased out of such Excess Proceeds; (ii) deposit with the Paying
Agent U.S. Legal Tender sufficient to pay the repurchase price plus accrued
interest, if any, of all Notes or portions thereof so properly tendered; and (iii) deliver
or cause to be delivered to the Trustee the Notes so 

 

81

 

properly accepted together
with an Officers’ Certificate stating the aggregate principal amount of Notes
or portions thereof being repurchased by the Company.  If the aggregate principal amount of Notes
surrendered by Holders exceeds the amount of Excess Proceeds, the Trustee shall
select the Notes to be purchased on a pro rata basis on the basis of the
aggregate principal amount of tendered Notes (with such adjustments as may be
deemed appropriate by the Trustee so that only Notes in principal amounts of
$2,000, or integral multiples of $1,000 in excess of $2,000, shall be
purchased, except that (i) if all of the Notes of a Holder are to be
purchased, the entire outstanding principal amount of Notes held by such
Holder, even if not a multiple of $1,000, may be purchased, subject, in the
case of Global Notes, to the procedures of DTC and (ii) in any event the
unpurchased portion of Notes of any Holder purchased in part shall be in a
principal amount of at least $2,000.  The
Paying Agent shall promptly mail or pay by wire transfer to the Holders of
Notes so properly tendered and so accepted the repurchase price for such Notes
and the Company shall promptly execute and deliver and, upon receipt of an
Authentication Order in accordance with Section 2.02, the Trustee
shall promptly authenticate and deliver to each Holder a new Note equal in
principal amount to any unpurchased portion of the Notes surrendered, if any; provided that the unpurchased portion of Notes of
any Holder whose Notes are purchased in part shall be in a principal amount of
at least $2,000.  Any Note so accepted
for repurchase will cease to accrue interest on and after the Repurchase Offer
Payment Date.  Any Notes not so accepted
shall be promptly mailed by the Company to the Holders thereof.  For purposes of this Section 4.19,
the Trustee shall act as the Paying Agent.

 

The
Company will publicly announce the results of the Repurchase Offer on or as
soon as reasonably practicable after the Repurchase Offer Payment Date.  Any amounts remaining after the repurchase of
Notes pursuant to a Repurchase Offer (including as a result of the limitations
specified herein on the denominations of purchased and unpurchased Notes of any
Holder) shall be returned by the Trustee to the Company.

 

The Company will comply with
the requirements of Rule 14e-1 under the Exchange Act and any other
securities laws and regulations thereunder to the extent such laws or
regulations are applicable in connection with the repurchase of the Notes
pursuant to a Repurchase Offer.  To the
extent that the provisions of any applicable securities laws or regulations
conflict with this Section 4.19, the Company will comply with such
securities laws and regulations and shall not be deemed to have breached its
obligations under this Section 4.19 by virtue thereof.

 

Notes (or portions thereof)
repurchased pursuant to a Repurchase Offer shall be cancelled and may not be
reissued.

 

SECTION 4.20                                            Limitation on
Liens.

 

The Company will not, and will not permit any
of its Restricted Subsidiaries to, directly or indirectly, create, incur,
assume or suffer to exist any Lien of any kind on any asset, now owned or
hereafter acquired, that constitutes (a) Note Collateral, other than Permitted
Collateral Liens, or (b) any asset (other than Note Collateral), other
than Permitted Liens.

 

82

 

SECTION 4.21                                            Business
Activities.

 

The Company will not, and will not permit any
of its Restricted Subsidiaries to, engage in any business other than Permitted
Businesses.

 

SECTION 4.22                                            Payments for
Consent.

 

The Company will not, and will not permit any
of its Restricted Subsidiaries to, directly or indirectly, pay or cause to be
paid any consideration to or for the benefit of any Holder for or as an
inducement to any consent, waiver or amendment of any of the terms or
provisions of any Indenture Document, the Registration Rights Agreement with
respect to which such Holder is a beneficiary or the Intercreditor Agreement
unless such consideration is offered to be paid and is paid to all Holders that
consent, waive or agree to amend in the time frame set forth in the
solicitation documents relating to such consent, waiver or agreement.

 

SECTION 4.23                                            Impairment of
Security Interest.

 

Neither the Company nor any of its Restricted
Subsidiaries will take or omit to take any action which would adversely affect
or impair in any material respect the Note Liens in favor of the Trustee with
respect to the Note Collateral, except in the case where such Note Collateral
constitutes Secondary Collateral, to the extent required or permitted under the
Intercreditor Agreement.  Neither the
Company nor any Guarantor shall grant to any Person (other than the Trustee),
or permit any Person (other than the Trustee) to retain, any interest
whatsoever in the Note Collateral other than Permitted Collateral Liens.  Neither the Company nor any Guarantor will
enter into any agreement that requires the proceeds received from any sale of
Note Collateral to be applied to repay, redeem, defease or otherwise acquire or
retire any Indebtedness of any Person, other than as permitted by this
Indenture, the Notes and the Collateral Documents.

 

SECTION 4.24                                            Designation of
Restricted and Unrestricted Subsidiaries.

 

The relevant Board of Directors of the
Company or any of its Restricted Subsidiaries may designate any of its
Restricted Subsidiaries (including any newly acquired or newly formed
Subsidiary or Person becoming a Subsidiary through merger or consolidation or
Investment therein) to be an Unrestricted Subsidiary if that designation would
not cause a Default.  If a Restricted
Subsidiary is designated as an Unrestricted Subsidiary, the aggregate Fair Market
Value of all outstanding Investments owned by the Company and its Restricted
Subsidiaries in the Subsidiary designated as an Unrestricted Subsidiary will be
deemed to be an Investment made as of the time of the designation and, unless
such Investment is a Permitted Investment, will reduce the amount available for
Restricted Payments under Section 4.10 or under one or more clauses
of the definition of Permitted Investments, as determined by the Company.  That designation will only be permitted if
the Investment would be permitted at that time and if the Restricted Subsidiary
otherwise meets the definition of an Unrestricted Subsidiary.  The relevant Board of Directors may
redesignate any Unrestricted Subsidiary to be a Restricted Subsidiary if that
redesignation would not cause a Default.

 

Any designation of a Subsidiary of the
Company as an Unrestricted Subsidiary will be evidenced to the Trustee by
filing with the Trustee a certified copy of a Board Resolution giving effect to
such designation and an Officers’ Certificate certifying that such designation
complied

 

83

 

with the preceding
conditions and was permitted by Section 4.10.  If, at any time, any Unrestricted Subsidiary
would fail to meet the preceding requirements as an Unrestricted Subsidiary, it
will thereafter cease to be an Unrestricted Subsidiary for purposes of this
Indenture and any Indebtedness of such Subsidiary will be deemed to be incurred
by a Restricted Subsidiary of the Company as of such date and, if such
Indebtedness is not permitted to be incurred as of such date under Section 4.12,
the Company will be in default of such covenant.  The Board of Directors of the Company may at
any time designate any Unrestricted Subsidiary to be a Restricted Subsidiary of
the Company; provided
that such designation will be deemed to be an incurrence of Indebtedness by a
Restricted Subsidiary of the Company of any outstanding Indebtedness of such
Unrestricted Subsidiary, and such designation will only be permitted if

 

(a)                                  such
Indebtedness is permitted under Section 4.12, calculated on a pro
forma basis as if such designation had occurred at the beginning of the
four-quarter reference period; and

 

(b)                                 no Default or
Event of Default would be in existence following such designation.

 

SECTION 4.25                                            Additional
Interest.

 

If Additional Interest becomes payable by the
Company pursuant to the Registration Rights Agreement, the Company shall
deliver to the Trustee an Officers’ Certificate stating (a) the amount of
Additional Interest due and payable, (b) the section of the Registration
Rights Agreement pursuant to which Additional Interest is due and payable and (c) the
date on which Additional Interest is payable. 
Unless and until a Trust Officer of the Trustee receives such an
Officers’ Certificate, the Trustee may assume without inquiry that no
Additional Interest is payable; provided,
that the failure of the Company to deliver to the Trustee such Officers’
Certificate shall not relieve the Company of its obligation to pay any such
Additional Interest when due and payable.

 

SECTION 4.26                                            Limitation on
Sale and Leaseback Transactions.

 

The Company will not, and will not permit any
of its Restricted Subsidiaries to, enter into any Sale and Leaseback
Transaction; provided
that the Company or any Guarantor may enter into a Sale and Leaseback
Transaction if:

 

(a)                                  the Company or
that Guarantor, as applicable, could have (1) incurred Indebtedness in an
amount equal to the Attributable Debt relating to such Sale and Leaseback
Transaction under the Fixed Charge Coverage Ratio test in the first paragraph
of Section 4.12 and (2) incurred a Lien to secure such
Indebtedness pursuant to Section 4.20;

 

(b)                                 the gross cash
proceeds of that Sale and Leaseback Transaction are at least equal to the Fair
Market Value, as determined in good faith by the Board of Directors of the
Company and set forth in an Officers’ Certificate of the Company delivered to
the Trustee, of the property that is the subject of that Sale and Leaseback
Transaction; and

 

84

 

(c)                                  the transfer of
assets in that Sale and Leaseback Transaction is permitted by, and the Company
applies the proceeds of such transaction in compliance with, Section 4.16.

 

SECTION 4.27                                            Subordination
of Intercompany Debt; No Amendments to Certain Agreements.

 

Each of the Guarantors and
the Company will not, directly or indirectly, incur or suffer to exist any
Intercompany Debt, unless such Intercompany Debt constitutes subordinated
Indebtedness of the Company or such Guarantor, as applicable, owing such
Intercompany Debt that is subject to the terms and provisions of the
Subordination Agreement.

 

Each of the Guarantors and
the Company will not, directly or indirectly, without the prior written consent
of Holders of a majority in aggregate principal amount of Notes then
outstanding voting as a single class, amend, waive or otherwise modify, or
surrender any rights, or increase the obligations, of the Company or such
Guarantor, respectively, under, the Subordination Agreement, the Management
Incentive Plan (after the adoption of the Management Incentive Plan (if
adopted) in accordance with the Plan), the Aurora West Kiewit Documents or the
Indiana Port Lease Agreement (or any agreements entered into in accordance
therewith), in each case, unless the terms of the Subordination Agreement, the
Management Incentive Plan (after the adoption of the Management Incentive Plan
(if adopted) in accordance with the Plan), the Aurora West Kiewit Documents or
the Indiana Port Lease Agreement (or any such agreements entered into in
accordance therewith), as applicable, as so amended, waived or modified, or the
rights and obligations of the Company and the Guarantors established thereunder
after giving effect to such surrender or increase, as applicable, are not
materially less favorable to the Holders of the Notes as those contained in the
Subordination Agreement, the Management Incentive Plan (as adopted, if
adopted), the Aurora West Kiewit Documents or the Indiana Port Lease Agreement
(or any such agreements entered into in accordance therewith), as applicable,
immediately before such amendment, waiver, modification or as those rights and
obligations established thereunder immediately before such surrender or
increase, as applicable.

 

SECTION 4.28                                            After-Acquired
Property.

 

If at any time the
Company or any Guarantor acquires or otherwise owns any After-Acquired Property
(but subject to the limitations, if applicable, specified in Section 12.12
and other than any Excluded General Intangibles, Excluded Foreign Subsidiary
Capital Stock and Excluded Trademark Applications, no later than the
After-Acquired Property Required Date with respect to such After-Acquired
Property (and subject to any provision hereof requiring any earlier action),
the Company or such Guarantor shall:

 

(a)                                  cause a valid
and enforceable and (except solely as to any Excluded Personal Property)
perfected first priority Lien in or on such After-Acquired Property (subject
only to Permitted Collateral Liens) to have vested in the Collateral Agent, as
security for the Note Obligations; and

 

85

 

(b)                                 except as to
any Excluded Personal Property, have executed and delivered to the Collateral
Agent the documents and certificates required by Section 12.01(g) or
any other provision of this Indenture;

 

and thereupon all provisions of this Indenture
relating to the Note Collateral shall be deemed to relate to such
After-Acquired Property to the same extent and with the same force and effect.

 

SECTION 4.29                                            Further
Assurances.

 

(a)                                  Each of the
Guarantors and the Company shall, and the Company shall cause each of its
Restricted Subsidiaries to:

 

(1)                                  promptly furnish to the
Collateral Agent (for the benefit of the Trustee and the Holders) from time to
time, at the sole cost and expense of such Guarantor or the Company,
respectively, all such agreements, instruments, statements and schedules
further identifying and describing the property intended to be Note Collateral
or the obligations intended to be secured by the Collateral Documents and such
other reports in connection with the Note Collateral, in each case, as the
Trustee or Holders of at least 25% in aggregate principal amount of the Notes
then outstanding voting as a single class may reasonably request by written
notice delivered to the Company, all in such detail as the Trustee or such
Holders may reasonably request; and

 

(2)                                  subject to the Intercreditor
Agreement (solely with respect to Secondary Collateral), at any time and from
time to time, at the sole cost and expense of such Guarantor or the Company,
respectively, promptly and duly execute, acknowledge, deliver, record,
re-record, file, re-file, register and re-register any and all such further
notice filings, agreements, acts, deeds, conveyances, security agreements,
mortgages, assignments, estoppel certificates, financing statements and
continuations thereof, termination statements, notices of assignment,
transfers, certificates, assurances and other instruments, and take such
further actions, as the Collateral Agent or Holders of at least 25% in
aggregate principal amount of the Notes then outstanding voting as a single
class may reasonably request from time to time in order to (i) carry out
more effectively the purposes of any Collateral Document, (ii) subject to
the Liens created by any of the Collateral Documents any of the properties,
rights or interests intended to be covered by any of the Collateral Documents, (iii) perfect
and maintain the validity, perfection, enforceability and priority of any of
the Collateral Documents and the Liens intended to be created thereby, or (iv) better
assure, convey, grant, assign, transfer, preserve, protect and confirm to the
Collateral Agent the rights granted or now or hereafter intended to be granted
to the Collateral Agent under the Collateral Documents.

 

(b)                                 Upon request of
the Collateral Agent at any time after an Event of Default has occurred and is
continuing, the Company and each of the Guarantors shall, and the Company shall
cause each of its Restricted Subsidiaries to, (1) permit the Collateral
Agent or any advisor, auditor, consultant, attorney or representative acting
for the 

 

86

 

Collateral
Agent, upon reasonable notice to the Company or such Guarantor or Restricted
Subsidiary, as applicable, and during normal business hours, to visit and
inspect the Company or any of the property of the Company or such Guarantor or
such Restricted Subsidiary, as applicable, to review, make extracts from and
copy the books and records of the Company or such Guarantor or Restricted
Subsidiary, as applicable, relating to any such property, and to discuss any
matter pertaining to any such property with the officers and employees of the
Company or such Guarantor or Restricted Subsidiary, as applicable, and (2) deliver
to the Collateral Agent such reports, including valuations, relating to any
such property or any Lien thereon as the Collateral Agent may reasonably
request.  The Company will promptly
reimburse the Trustee and Collateral Agent for all costs and expenses incurred
by the Trustee or Collateral Agent in connection therewith, including all
reasonable fees and charges of any advisors, auditors, consultants, attorneys
or representatives acting for the Trustee or for the Collateral Agent.

 

SECTION 4.30                                            Calculation of
Original Issue Discount.

 

The Company shall file with
the Trustee promptly at the end of each calendar year (i) a written notice
specifying the amount of original issue discount (including daily rates and
accrual periods) accrued on the Notes as of the end of such year and (ii) such
other specific information relating to such original issue discount as may then
be relevant under the Internal Revenue Code of 1986, as amended from time to
time.

 

SECTION 4.31                                            Credit Rating
for the Notes.

 

The
Company shall use its reasonable best efforts to obtain as soon as reasonably
practicable after the Issue Date and thereafter to maintain at all times a
credit rating for the Notes from either S&P or Moody’s (or, if at any time
neither Moody’s nor S&P shall be rating the Notes for reasons outside of
the control of the Company, from any other “nationally recognized statistical
rating organization” (within the meaning of Rule 15c3-1(c)(2)(vi)(F) under
the Exchange Act) selected by the Company as a replacement agency), such
efforts to include furnishing such statistical rating organization any and all
documents, instruments, information and undertakings as may be requested by
such statistical rating organization in respect of the Notes.

 

ARTICLE FIVE

 

SUCCESSOR CORPORATION

 

SECTION 5.01                                            Merger, Consolidation
and Sale of Assets.

 

The Company shall not, directly or
indirectly, (a) consolidate or merge with or into another Person (whether
or not the Company is the surviving entity); or (b) sell, assign,
transfer, convey or otherwise dispose of all or substantially all of the
properties and assets of the Company and its Restricted Subsidiaries, taken as
a whole, in one or more related transactions, to another Person, unless:

 

(1)                                  either:

 

87

 

(i)                                     the Company is the surviving
entity; or

 

(ii)                                  the Person formed by or
surviving any such consolidation or merger (if other than the Company) or to
which such sale, assignment, transfer, conveyance or other disposition has been
made is a Person organized or existing under the laws of the United States of
America, any state of the United States of America or the District of Columbia;

 

(2)                                  the Person formed by or
surviving any such consolidation or merger (if other than the Company) or the
Person to which such sale, assignment, transfer, conveyance or other
disposition has been made assumes all the obligations of the Company under the
Notes, this Indenture and any Collateral Documents to which the Company is a
party pursuant to a supplemental indenture in form reasonably satisfactory to
the Trustee and in connection therewith shall execute and deliver such other
agreements, cause such instruments and Uniform Commercial Code financing
statements to be filed and recorded in such jurisdictions and take such other
actions as may be required by applicable law to continue the validity and
enforceability, and perfect or continue the perfection, of the Note Lien
created under the Collateral Documents on the Note Collateral owned by or
transferred to such Person;

 

(3)                                  immediately before and after
giving effect to such transaction, no Default or Event of Default shall have
occurred and be continuing;

 

(4)                                  the Company or the Person
formed by or surviving any such consolidation or merger (if other than the
Company), or to which such sale, assignment, transfer, conveyance or other
disposition has been made will, on the date of such transaction after giving
pro forma effect thereto and any related financing transactions as if the same
had occurred at the beginning of the applicable four-quarter period:

 

(i)                                     have Consolidated Net Worth
immediately after the transaction equal to or greater than the Consolidated Net
Worth of the Company immediately preceding the transaction; and

 

(ii)                                  be permitted to incur at
least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage
Ratio test set forth in the first paragraph of Section 4.12; and

 

(5)                                  the Company shall have
delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel,
each stating that the consummation of such consolidation, merger, sale,
assignment, transfer, conveyance or other disposition and, if such an
assumption is required in connection with such transaction, such assumption,
complies with the applicable provisions of this Indenture and that all
conditions precedent in this Indenture relating to such transaction have been
satisfied.

 

88

 

The conditions set forth in clause (4) of
the first paragraph of this Section 5.01
will not apply to:

 

(1)                                  a merger of the
Company with an Affiliate solely for the purpose of reincorporating the Company
in another jurisdiction; or

 

(2)                                  any merger, consolidation,
sale, assignment, transfer, conveyance or other disposition of properties and
assets, solely between or among the Company and one or more Restricted
Subsidiaries that are Guarantors.

 

The Company shall not, directly or
indirectly, lease all or substantially all of the properties and assets of the
Company and its Restricted Subsidiaries, taken as a whole, in one or more related
transactions, to any other Person.

 

For purposes of the foregoing, the
disposition (by lease, assignment, sale or otherwise, in a single transaction
or series of transactions) of all or substantially all of the properties and
assets of one or more Restricted Subsidiaries of the Company, the Capital Stock
of which constitutes all or substantially all of the properties and assets of
the Company, shall be deemed to be the transfer of all or substantially all of
the properties and assets of the Company.

 

SECTION 5.02                                            Successor
Person Substituted.

 

Upon any consolidation or merger or any
disposition of all or substantially all of the properties and assets of the
Company in accordance with Section 5.01 in which the Company is not
surviving or the continuing Person, the successor Person formed by such
consolidation or into which the Company is merged or to which such disposition
is made shall succeed to, and be substituted for, and may exercise every right
and power of, the Company under this Indenture and the Notes with the same
effect as if such surviving entity had been named as such (so that from and
after the date of such consolidation, merger or disposition, the provisions of
this Indenture referring to the “Company” shall refer instead to such Person
and not to the Company) and will succeed to, and be substituted for, and may
exercise every right and power of, the Company under the Notes, this Indenture
and the Collateral Documents.  Upon such
substitution, except in the case of a sale, assignment, transfer, conveyance or
other disposition of less than all the properties and assets of the Company and
its Restricted Subsidiaries, taken as a whole, the predecessor Company shall be
released from its obligations under the Notes, this Indenture and the Collateral
Documents.  The Trustee shall enter into
a supplemental indenture to evidence the succession and substitution of such
Person and such discharge and release of the Company.

 

ARTICLE SIX

 

DEFAULT AND REMEDIES

 

SECTION 6.01                                            Events of
Default.

 

Each of the following is an “Event of
Default”  (whatever the reason for
such Event of Default and whether it shall be involuntary or be effected by
operation of law):

 

89

 

(a)                                  the failure to
pay interest on any Notes when the same becomes due and payable and the default
continues for a period of 30 consecutive days;

 

(b)                                 the failure to
pay the principal of or premium, if any, on any Notes, when such principal or
premium, if any, becomes due and payable, at maturity, upon redemption or
otherwise;

 

(c)                                  default in the
payment of principal of and interest on Notes required to be repurchased
pursuant to a Change of Control Offer or a Repurchase Offer as described under Section 4.15
or 4.19, respectively, when due and payable;

 

(d)                                 failure to
perform or comply with any of the provisions of Section 5.01 or 10.04);

 

(e)                                  failure by the
Company or any of its Restricted Subsidiaries to perform any covenant or
agreement in the Indenture Documents (other than any default described in clause
(a), (b), (c) or (d) above), and such
failure continues for a period of 60 consecutive days after written notice to
the Company by the Trustee or Holders of at least 25% in aggregate principal
amount of the Notes then outstanding voting as a single class;

 

(f)                                    default under
any mortgage, indenture or instrument under which there may be issued or by
which there may be secured or evidenced any Indebtedness for money borrowed by
the Company or any of its Significant Subsidiaries or any group of Restricted
Subsidiaries that, taken together, would constitute a Significant Subsidiary
(or the payment of which is guaranteed by the Company or any of its Significant
Subsidiaries), whether such Indebtedness or guarantee now exists or is created
after the Issue Date (but excluding Indebtedness owing to the Company or a
Guarantor), if that default:

 

(1)                                  is caused by a failure to
pay any portion of the principal (or effect any cash collateralization of
letters of credit when required) of such Indebtedness when due and payable
after the expiration of the grace period provided in such Indebtedness (a “Payment
Default”); or

 

(2)                                  results in the acceleration
of such Indebtedness prior to its Stated Maturity (which acceleration is not
rescinded, annulled or otherwise cured within 20 days of receipt by the
Company, such Significant Subsidiary or any Subsidiary in such group of
Restricted Subsidiaries of notice of any such acceleration),

 

and,
in each case, the principal (or face) amount of any such Indebtedness so due
and payable or that has been accelerated, together with the principal (or face)
amount that is so due and payable or that has been accelerated of any other
such Indebtedness under which there has been a Payment Default or the Stated
Maturity of which has been so accelerated, aggregates $10,000,000 or more;

 

(g)                                 the rendering
of a final judgment or judgments (not subject to appeal) against the Company or
any of its Restricted Subsidiaries, to the extent not covered or paid by
insurance, in an amount in excess of $2,500,000, which judgments are not paid, 

 

90

 

waived,
satisfied, discharged or stayed for a period of 60 consecutive days after the
date on which the right to appeal has expired;

 

(h)                                 the denial or
disaffirmation by the Company or any of its Restricted Subsidiaries, or any
Person acting on behalf of any of them, in writing, of any material obligation
of the Company or any of its Restricted Subsidiaries set forth in or arising
under any Collateral Document (other than by reason of a release from such
obligation or the Note Lien related thereto in accordance with the terms of
this Indenture and the Collateral Documents);

 

(i)                                     the Company or
any Significant Subsidiary (or any group of Restricted Subsidiaries that, taken
together, would constitute a Significant Subsidiary) (1) commences a
voluntary case or proceeding under any Bankruptcy Code with respect to itself
(or themselves), (2) consents to the entry of a judgment, decree or order
for relief against it (or them) in an involuntary case or proceeding under any
Bankruptcy Code, (3) consents to the appointment of a Custodian of it (or
them) or for substantially all of its (or their) property, (4) consents to
or acquiesces in the institution of a bankruptcy or an insolvency proceeding
against it (or them), (5) makes a general assignment for the benefit of
its (or their) creditors or (6) takes any corporate action to authorize or
effect any of the foregoing;

 

(j)                                     a court of
competent jurisdiction enters a judgment, decree or order for relief in respect
of the Company or any Significant Subsidiary (or any group of Restricted
Subsidiaries that, taken together, would constitute a Significant Subsidiary)
in an involuntary case or proceeding under any Bankruptcy Code, which shall (1) approve
as properly filed a petition seeking reorganization, arrangement, adjustment or
composition in respect of the Company or such Significant Subsidiary (or such
group of Restricted Subsidiaries), (2) appoint a Custodian of the Company
or such Significant Subsidiary (or such group of Restricted Subsidiaries) or
for substantially all of its (or their) property or (3) order the
winding-up or liquidation of its (or their) affairs; and such judgment, decree
or order shall remain unstayed and in effect for a period of 60 consecutive
days;

 

(k)                                  any Note
Guarantee from a Significant Subsidiary, or any group of Restricted
Subsidiaries that, taken together, would constitute a Significant Subsidiary,
ceases to be in full force and effect or is declared null and void and
unenforceable or is found to be invalid or a Guarantor denies in writing its
liability under the Note Guarantee (other than by reason of a release of such
Guarantor from the Note Guarantee in accordance with the terms of the Indenture
Documents); and

 

(l)                                     except as a
result of the release of any Lien in accordance with the terms of this
Indenture and the Collateral Documents, any Lien purported to be created by any
Collateral Document with respect to any Specified Collateral or with respect to
any other Note Collateral (other than Specified Collateral) that, individually
or in the aggregate, has a Fair Market Value in excess of $2,000,000 (1) ceases
to be in full force and effect, (2) ceases to give the Collateral Agent,
for the benefit of the holders of the Note Obligations, the Liens, rights,
powers and privileges purported to be created and granted thereby (including a
perfected first priority security interest in and Lien on (subject only to 

 

91

 

Permitted
Collateral Liens) all of the Note Collateral thereunder) in favor of the
Collateral Agent, or (3) is asserted by the Company or any Guarantor not
to be, a valid, perfected, first priority security interest in or Lien on
(subject only to Permitted Collateral Liens) the Note Collateral covered
thereby.

 

SECTION 6.02                                            Acceleration.

 

(a)                                  If an Event of
Default (other than an Event of Default specified in Section 6.01(i) or
6.01(j) above with respect to the Company, any Restricted
Subsidiary that is a Significant Subsidiary or any group of Restricted
Subsidiaries that, taken together, would constitute a Significant Subsidiary)
shall occur and be continuing and has not been waived, the Trustee may, or at
the written direction of Holders of at least 25% in aggregate principal amount
of outstanding Notes voting as a single class shall, declare all unpaid
principal of and premium, if any, and accrued interest on all the Notes to be
due and payable by notice in writing to the Company and the Trustee (if given
by the Holders) specifying the Event of Default and that it is a “notice of
acceleration” (the “Acceleration Notice”), and the same shall become
immediately due and payable.

 

(b)                                 If an Event of
Default specified in Section 6.01(i) or 6.01(j) above
with respect to the Company, any Restricted Subsidiary that is a Significant
Subsidiary or any group of Restricted Subsidiaries that, taken together, would
constitute a Significant Subsidiary shall occur and be continuing, then all
unpaid principal of and premium, if any, and accrued interest on all of the
outstanding Notes shall ipso facto become and be immediately due and payable
without any declaration or other act on the part of the Trustee or any Holder.

 

(c)                                  In the event of
a declaration of acceleration of the Notes because an Event of Default
described in Section 6.01(f) has occurred and is continuing,
such declaration of acceleration of the Notes shall be automatically rescinded
and annulled and such Event of Default under Section 6.01(f) shall
be deemed not to have occurred or be continuing if both (a) either (x) the
default giving rise to such Event of Default pursuant to Section 6.01(f) shall
be remedied or cured pursuant to the terms of, or waived by the holders of,
such Indebtedness or any consequent acceleration of such Indebtedness shall be
rescinded, annulled or otherwise cured or (y) such Indebtedness shall have
been discharged in full, in the case of clause (x) or (y),
within 30 days after such declaration of acceleration of the Notes with respect
thereto and (b) (1) the rescission and annulment of such acceleration
of the Notes would not conflict with any judgment or decree and (2) all
existing Events of Default, except nonpayment of principal, premium or interest
on the Notes that became due solely because of such acceleration of the Notes,
have been cured or waived.

 

(d)                                 At any time
after a declaration of or automatic acceleration with respect to the Notes as
described in Sections 6.02(a) and 6.02(b), the Holders of a
majority in principal amount of the Notes voting as a single class may rescind
and cancel such declaration and its consequences:  (1) if the rescission would not conflict
with any judgment or decree;  (2) if
all existing Events of Default, other than nonpayment of principal, premium, if
any, or interest on the Notes that has become due solely because of 

 

92

 

the
acceleration of the Notes, have been cured or waived; (3) to the extent
the payment of such interest is lawful, interest on overdue installments of
interest and overdue principal and premium, if any, which has become due
otherwise than by such declaration of acceleration, has been paid; (4) if
the Company has paid each of the Trustee and the Collateral Agent its
reasonable compensation and reimbursed each of the Trustee and the Collateral
Agent for its reasonable expenses, disbursements and its advances; and (5) in
the event of the cure or waiver of an Event of Default of the type described in
Section 6.01(i) or 6.01(j), the Trustee shall have
received an Officers’ Certificate that such Event of Default has been cured or
waived together with evidence confirming the requisite majority vote of the
Holders.  No such rescission shall affect
any subsequent Default or impair any right consequent thereto.

 

(e)                                  If an Event of
Default occurs by reason of any willful action (or inaction) taken (or not
taken) by or on behalf of the Company with the intention of avoiding payment of
the premium that the Company would have been required to pay if the Company
then had elected to redeem the Notes pursuant to the optional redemption
provisions of Section 3.01, an equivalent premium will also become
and be immediately due and payable to the extent permitted by applicable law
upon the acceleration of the Notes.

 

SECTION 6.03                                            Other Remedies.

 

If an Event of Default occurs and is
continuing, the Trustee may pursue any available remedy by proceeding at law or
in equity to collect the payment of principal of, premium, if any, or interest
on the Notes or to enforce the performance of any provision of the Notes, this
Indenture, any Collateral Document or any Note Guarantee or to direct the
Collateral Agent to exercise remedies with respect to the Primary Collateral
and, subject to the terms of the Intercreditor Agreement, the Secondary
Collateral.

 

The Trustee or the Collateral Agent may
maintain a proceeding even if it does not possess any of the Notes or does not
produce any of them in the proceeding.  A
delay or omission by the Trustee, the Collateral Agent or any Holder in
exercising any right or remedy accruing upon an Event of Default shall not
impair the right or remedy or constitute a waiver of or acquiescence in the
Event of Default.  No remedy is exclusive
of any other remedy.  All available remedies
are cumulative to the extent permitted by law.

 

If an Event of Default occurs, the Trustee,
on behalf of the Holders of the Notes, in addition to any rights or remedies
available to the Trustee under this Indenture, will be entitled to take (or
instruct the Collateral Agent to take) such actions as the Trustee deems
advisable to protect and enforce the rights of the Trustee, the Collateral
Agent and the Holders in the Note Collateral, including, without limitation,
the institution of foreclosure proceedings in accordance with the Collateral
Documents and applicable law. However, the rights and remedies available to the
Trustee and the Collateral Agent under the Note Collateral Documents and the
actions permitted to be taken by the Trustee and the Collateral Agent
thereunder will be subject to the provisions of the Intercreditor Agreement.

 

93

 

The Trustee will apply (or
instruct the Collateral Agent to apply) the proceeds received by the Collateral
Agent or the Trustee from any foreclosure of the Note Collateral in accordance
with the provisions of Section 6.10; provided,
that the application of any such proceeds of Note Collateral that constitutes
Secondary Collateral shall be subject to the terms of the Intercreditor
Agreement.

 

SECTION 6.04                                            Waiver of Past
Defaults.

 

Subject to Sections 2.09,
6.07 and 9.02,
the Holders of a majority in aggregate principal amount of the outstanding
Notes voting as a single class may, on behalf of the Holders of all the Notes,
rescind an acceleration or waive (including, without limitation, in connection
with a purchase of, or tender offer or exchange offer for, Notes) any existing
Default or Event of Default, and its consequences, except (other than as
provided in Section 6.02(c) or Section 6.02(d)) a default in the
payment of the principal of or premium, if any, or interest on any Notes or in
respect of a covenant or provision which under this Indenture cannot be
modified or amended without the consent of the Holder of each Note then
outstanding.  When a Default or Event of
Default is waived, it is cured and ceases to exist and is deemed to have been
cured and not to have occurred, and any Event of Default arising therefrom
shall be deemed to have been cured and not to have occurred for every purpose
of this Indenture, the Notes and the Collateral Documents, but no such waiver
shall extend to any subsequent or other Default or Event of Default or impair
any right consequent thereon.

 

SECTION 6.05                                            Control by
Majority.

 

Subject to Section 2.09, the Intercreditor Agreement
and applicable law, the Holders of a majority in aggregate principal amount of
the outstanding Notes voting as a single class may direct the time, method and
place of conducting any proceeding for exercising any remedy available to the
Trustee or the Collateral Agent, as the case may be, or exercising any trust or
power conferred on the Trustee or the Collateral Agent, as the case may be,
including any remedies provided for in Section 6.03.  Subject to Section 7.01,
however, the Trustee or the Collateral Agent, as the case may be, may refuse to
follow any direction (which direction, if sent to the Trustee or the Collateral
Agent, as the case may be, shall be in writing) that the Trustee or the
Collateral Agent, as the case may be, reasonably believes conflicts with any
applicable law, this Indenture, the Notes, the Note Guarantees, the Collateral
Documents or the Intercreditor Agreement, that the Trustee or the Collateral
Agent, as the case may be, determines may be unduly prejudicial to the rights
of another Holder, or that may subject the Trustee or the Collateral Agent, as
the case may be, to personal liability; provided that the Trustee or the
Collateral Agent, as the case may be, may take any other action deemed proper
by the Trustee or the Collateral Agent, as the case may be, which is not
inconsistent with such direction (which direction, if sent to the Trustee or
the Collateral Agent, as the case may be, shall be in writing).

 

SECTION 6.06                                            Limitation on
Holders’ Rights to Pursue Remedies.

 

A Holder may not pursue any
remedy with respect to this Indenture or the Notes unless:

 

(a)                                  such Holder
gives to the Trustee written notice of a continuing Event of Default;

 

94

 

(b)                                 subject to Section 2.09,
Holders of at least 25% in aggregate principal amount of the outstanding Notes
voting as a single class make a written request to the Trustee to institute
proceedings in respect of that Event of Default;

 

(c)                                  such Holder or
Holders offer to the Trustee security or indemnity reasonably satisfactory to
the Trustee against any loss, liability or expense to be incurred in compliance
with such request;

 

(d)                                 the Trustee
does not comply with the request within 60 days after receipt of the request
and the offer and, if requested, the provision of security or indemnity; and

 

(e)                                  during such 60
day period the Holders of a majority in aggregate principal amount of the
outstanding Notes voting as a single class do not give the Trustee a written
direction which, in the opinion of the Trustee, is inconsistent with the
request.

 

A Holder may not use this
Indenture to prejudice the rights of another Holder or to obtain a preference
or priority over such other Holder or to enforce any right under this
Indenture, except in the manner herein provided and for the equal and ratable
benefit of all such Holders.

 

SECTION 6.07                                            Rights of
Holders to Receive Payment.

 

Notwithstanding any other
provision of this Indenture, the right of any Holder to receive payment of
principal of, premium, if any, and interest on a Note, on or after the
respective due dates expressed in such Note, or to bring suit for the
enforcement of any such payment on or after such respective dates, shall not be
impaired or affected without the consent of such Holder; provided that a
Holder shall not have the right to institute any such suit for the enforcement
of payment if, and to the extent, the institution or prosecution thereof or the
entry of judgment therein would, under applicable law, result in the surrender,
impairment, waiver or loss of the Note Lien upon any Note Collateral.

 

SECTION 6.08                                            Collection Suit
by Trustee or Collateral Agent.

 

If an Event of Default in
payment of principal of, premium, if any, or interest specified in Section 6.01(a) or Section 6.01(b) shall occur and
be continuing, subject to the Intercreditor Agreement, the Trustee and the
Collateral Agent may recover judgment (1) in its own name and (2) (x) in
the case of the Trustee, as trustee of an express trust or (y) in the case
of the Collateral Agent, as collateral agent on behalf of each of the Holders,
in each case against the Company or any other obligor on the Notes for the
whole amount of principal, premium, if any, and accrued interest remaining
unpaid, together with interest on overdue principal and, to the extent that
payment of such interest is lawful, interest on overdue installments of
interest at the rate set forth in Section 4.01 and such further
amount as shall be sufficient to cover the costs and expenses of collection,
including the reasonable compensation, expenses, disbursements and advances of
the Trustee, the Collateral Agent and their respective agents and counsel and
any other amounts due the Trustee under Section 7.07
and the Collateral Agent under the Collateral Documents.

 

95

 

SECTION 6.09                                            Trustee May File
Proofs of Claim.

 

The Trustee and the
Collateral Agent are authorized to file such proofs of claim and other papers
or documents as may be necessary or advisable in order to have the claims of
the Trustee or the Collateral Agent (including any claim for the reasonable compensation,
expenses, disbursements and advances of the Trustee, the Collateral Agent,
their respective agents and counsel) and the Holders allowed in any judicial
proceedings relating to the Company or any other obligor upon the Notes, any of
their respective creditors or any of their respective property and, subject to
the Intercreditor Agreement, shall be entitled and empowered to collect and
receive any monies or other property payable or deliverable on any such claims
and to distribute the same, and any Custodian in any such judicial proceedings
is hereby authorized by each Holder to make such payments to the Trustee or
Collateral Agent and, in the event that the Trustee shall consent to the making
of such payments directly to the Holders, to pay to the Trustee or Collateral
Agent any amount due to it for the reasonable compensation, expenses, taxes,
disbursements and advances of the Trustee, the Collateral Agent, their
respective agents and counsel, and any other amounts due any such Person under
the Collateral Documents and Section 7.07.  The Company’s payment obligations under this Section 6.09 shall be secured in accordance
with the provisions of Section 7.07.  Nothing herein contained shall be deemed to
authorize the Trustee or Collateral Agent to authorize or consent to or accept
or adopt on behalf of any Holder any plan of reorganization, arrangement,
adjustment or composition affecting the Notes or the rights of any Holder
thereof, or to authorize the Trustee or the Collateral Agent, as the case may
be, to vote in respect of the claim of any Holder in any such proceeding.

 

SECTION 6.10                                            Priorities.

 

If the Trustee collects any
money or property pursuant to this Article Six,
it shall, subject to the terms of the Intercreditor Agreement, pay out the money
or property in the following order:

 

First:  to the Trustee, the Collateral Agent, the
Paying Agent and the Registrar for amounts due under Section 7.07
(including payment of all compensation and expenses, all liabilities incurred
and all advances made by the Trustee or the Collateral Agent, as the case may
be, and the costs and expenses of collection);

 

Second:  if the Holders are forced to proceed against
the Company directly without the Trustee or the Collateral Agent, to the
Holders for their collection costs;

 

Third:  to the Holders for amounts due and unpaid on
the Notes for principal, premium, if any, and accrued interest ratably, without
preference or priority of any kind, according to the amounts due and payable on
the Notes for principal, premium, if any, and accrued interest respectively;
and

 

Fourth:  to the Company or any other obligor on the
Notes, as their interests may appear, or as a court of competent jurisdiction
may direct;

 

provided, that the
application of any such proceeds of Note Collateral that constitutes Secondary
Collateral shall be subject to the terms of the Intercreditor Agreement.

 

96

 

The Trustee, upon prior
written notice to the Company, may fix a record date and payment date for any
payment to Holders pursuant to this Section 6.10.

 

SECTION 6.11                                            Undertaking for
Costs.

 

All parties to this
Indenture agree, and each Holder by its acceptance of its Note shall be deemed
to have agreed, that in any suit for the enforcement of any right or remedy
under this Indenture or in any suit against the Trustee or the Collateral
Agent, as the case may be, for any action taken or omitted to be taken by it as
Trustee or the Collateral Agent, as the case may be, a court in its discretion
may require the filing by any party litigant in the suit of an undertaking to
pay the costs of the suit, and the court in its discretion may assess
reasonable costs, including reasonable attorneys’ fees, against any party
litigant in the suit, having due regard to the merits and good faith of the
claims or defenses made by the party litigant. 
This Section 6.11 does not
apply to a suit by the Trustee or the Collateral Agent, as the case may be, a
suit by a Holder pursuant to Section 6.07, or a suit by a Holder or
Holders of more than 10% in principal amount of the outstanding Notes voting as
a single class.

 

SECTION 6.12                                            Restoration of
Rights and Remedies.

 

If the Trustee, the
Collateral Agent or any Holder has instituted any proceedings to enforce any
right or remedy under this Indenture and such proceeding has been discontinued
or abandoned for any reason, or has been determined adversely to the Trustee,
the Collateral Agent or to such Holder, then and in every such case, subject to
any determination in such proceeding, the Company, the Trustee, the Collateral
Agent and the Holders shall be restored severally and respectively to their
former positions hereunder and thereafter all rights and remedies of the
Trustee, the Collateral Agent and the Holders shall continue as though no such
proceeding has been instituted.

 

SECTION 6.13                                            Rights and
Remedies Cumulative.

 

Except as otherwise provided
with respect to the replacement or payment of mutilated, destroyed, lost or
stolen Notes in Section 2.07, no right
or remedy herein conferred upon or reserved to the Trustee or to the Holders is
intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at
law or in equity or otherwise.  The
assertion or employment of any right or remedy hereunder, or otherwise, shall
not prevent the concurrent assertion or employment of any other appropriate
right or remedy.

 

SECTION 6.14                                            Delay or
Omission not Waiver.

 

No delay or omission of the
Trustee or the Collateral Agent or of any Holder of any Note to exercise any
right or remedy accruing upon any Event of Default shall impair any such right
or remedy or constitute a waiver of any such Event of Default or in
acquiescence therein.  Every right and
remedy given by this Article or by law to the Trustee or to the Holders
may be exercised from time to time, and as often as may be deemed expedient, by
the Trustee or by the Holders, as the case may be.

 

97

 

ARTICLE SEVEN

TRUSTEE

 

SECTION 7.01                                            Duties of
Trustee.

 

The duties and responsibilities of the Trustee shall
be as provided by the TIA and as set forth herein or in any Collateral Document.  In acting as Collateral Agent, the Collateral
Agent may rely upon, and shall be entitled to the benefits of and to enforce,
each and all of the rights, powers, immunities, indemnities and benefits
(subject to compliance with any related duties or responsibilities) of the
Trustee under this Article Seven.

 

(a)                                  If an Event of
Default has occurred and is continuing, the Trustee shall exercise such rights
and powers vested in it by this Indenture and use the same degree of care and
skill in its exercise thereof as a prudent person would exercise or use under
the circumstances in the conduct of his or her own affairs.

 

(b)                                 Except during
the continuance of an Event of Default:

 

(1)                                          the duties of
the Trustee shall be determined solely by the express provisions of this
Indenture and the TIA, and the Trustee need perform only those duties as are
specifically set forth in this Indenture and no covenants or obligations shall
be implied in or read into this Indenture against the Trustee; and

 

(2)                                          in the absence of
bad faith on its part, the Trustee may conclusively rely, as to the truth of
the statements and the correctness of the opinions expressed therein, upon
certificates or opinions furnished to the Trustee and conforming to the
requirements of this Indenture; provided, however, in case of any
such certificates or opinions which by the provisions hereof are furnished to
the Trustee, the Trustee shall examine the certificates and opinions to
determine whether or not they conform to the requirements of this Indenture but
need not confirm or investigate the accuracy of mathematical calculation or
other facts stated herein.

 

(c)                                  Notwithstanding
anything to the contrary herein contained, the Trustee may not be relieved from
liability for its own negligent action, its own negligent failure to act, or
its own willful misconduct, except that:

 

(1)                                          this paragraph
does not limit the effect of clause (b) of this Section 7.01;

 

(2)                                          the Trustee
shall not be liable for any error of judgment made in good faith by a Trust
Officer, unless it is proved that the Trustee was negligent in ascertaining the
pertinent facts; and

 

(3)                                          the Trustee
shall not be liable with respect to any action it takes or omits to take in
good faith in accordance with a direction received by it pursuant to Section 6.05.

 

98

 

Sections 7.01(c)(1), (2) and
(3) shall be in lieu of Sections 315(d)(1), 315(d)(2) and
315(d)(3) of the TIA and such Sections 315(d)(1), 315(d)(2) and
315(d)(3) are herein expressly excluded from this Indenture, as permitted
by the TIA.

 

(d)                                 No provision of
this Indenture shall require the Trustee to expend or risk its own funds or
otherwise incur any liability or expense. 
The Trustee shall be under no obligation to exercise any of its rights
or powers under this Indenture, the Intercreditor Agreement or the Collateral
Documents at the request of any Holders unless such Holders have offered to the
Trustee security and indemnity satisfactory to the Trustee against such risk,
liability or expense.

 

(e)                                  Whether or not
therein expressly so provided, every provision of this Indenture that in any
way relates to the Trustee is subject to clauses (a), (b), (c) and
(d) of this Section 7.01.

 

(f)                                    The Trustee
shall not be liable for interest on any money or assets received by it except
as the Trustee may agree in writing with the Company.  Money and assets held in trust by the Trustee
need not be segregated from other funds or assets held by the Trustee except to
the extent required by law.

 

(g)                                 Anything in
this Indenture to the contrary notwithstanding, in no event shall the Trustee,
the Paying Agent or the Registrar be liable under or in connection with this
Indenture for indirect, special, incidental, punitive or consequential losses
or damages of any kind whatsoever, including but not limited to lost profits,
whether or not foreseeable, even if the Trustee, the Paying Agent or the
Registrar has been advised of the possibility thereof and regardless of the
form of action in which such damages are sought.

 

SECTION 7.02                                            Rights of
Trustee.

 

Subject to Section 7.01:

 

(a)                                  In the absence
of bad faith on its part, the Trustee may conclusively rely and shall be fully
protected in acting or refraining from acting upon any resolution, certificate,
statement, instrument, opinion, notice, report, request, direction, consent,
order, bond, note or other paper or document believed by it to be genuine and
to have been signed or presented by the proper Person; provided, however,
in case of any such resolution, certificate, statement, instrument, opinion,
notice, report, request, direction, consent, order, bond, note or other paper
or document which by the provisions of hereof are furnished to the Trustee, the
Trustee shall examine such document to determine whether such document conforms
to the requirements of this Indenture. 
The Trustee need not investigate any fact or matter stated in the
document.

 

(b)                                 Before the
Trustee acts or refrains from acting, it may consult with counsel and may
require an Officers’ Certificate or an Opinion of Counsel, or both, which shall
conform to Sections 11.04 and 11.05.  The Trustee shall not be liable for any
action it takes or omits to take in good faith in reliance on such Officers’
Certificate or Opinion of Counsel.  The
advice of the Trustee’s counsel or any Opinion of Counsel shall be full and 

 

99

 

complete
authorization and protection from liability in respect of any action taken,
suffered or omitted by the Trustee hereunder in good faith and in reliance
thereon.

 

(c)                                  The Trustee may
act through its attorneys and agents and shall not be responsible for the
misconduct or negligence of any agent appointed with due care and in good
faith.

 

(d)                                 The Trustee
shall not be liable for any action taken, suffered or omitted to be taken in
good faith which it reasonably believes to be authorized or within its rights
or powers under this Indenture.

 

(e)                                  The Trustee
shall not be bound to make any investigation into the facts or matters stated
in any resolution, certificate, statement, instrument, opinion, notice, report,
request, direction, consent, order, bond, note or other paper or document, but
the Trustee, in its discretion, may make such further inquiry or investigation
into such facts or matters as it may see fit and, if the Trustee shall
determine to make such further inquiry or investigation, it shall be entitled,
upon reasonable notice to the Company, to examine the books, records and
premises of the Company, personally or by agent or attorney, and to consult
with the officers and representatives of the Company, including the Company’s
accountants and attorneys, at the sole cost of the Company and shall incur no
liability or additional liability of any kind by reason of such inquiry or
investigation.  Except as expressly
stated herein to the contrary, in no event shall the Trustee have any
responsibility to ascertain whether there has been compliance with any of the
covenants or provisions of Article Four or Five.

 

(f)                                    The Trustee
shall not be required to give any bond or surety in respect of the performance
of its powers and duties hereunder.

 

(g)                                 Unless
otherwise specifically provided in this Indenture, any demand, request,
direction or notice from the Company shall be sufficient if signed by an
Officer of the Company and any resolution of the Board of Directors shall be
sufficient if evidenced by a copy of such resolution certified by an Officer of
the Company to have been duly adopted and in full force and effect as of the
date thereof.

 

(h)                                 The Trustee
shall not be deemed to have notice or be charged with knowledge of any Default
or Event of Default unless the Trust Officer or the Trustee shall have received
from the Company, any Guarantor or any other obligor upon the Notes or from any
Holder written notice thereof at its address set forth in Section 11.02,
and such notice references the Notes and this Indenture.

 

(i)                                     The rights,
privileges, protections, immunities and benefits given to the Trustee,
including its right to be indemnified, are extended to, and shall be
enforceable by, the Trustee in each of its capacities hereunder, and each
agent, custodian and other Person employed to act hereunder.

 

(j)                                     The Trustee may
request that the Company deliver an Officers’ Certificate setting forth the
names of individuals or titles of officers authorized at such time to take
specified actions pursuant to this Indenture, which Officers’ Certificate may
be signed by 

 

100

 

any
persons authorized to sign an Officers’ Certificate, including any person
specified as so authorized in any such certificate previously delivered and not
superseded.

 

(k)                                  The permissive
right of the Trustee to take any action under this Indenture or any Collateral
Document shall not be construed as a duty to so act.

 

SECTION 7.03                                            Individual
Rights of Trustee.

 

The Trustee in its individual or any other capacity
may become the owner or pledgee of Notes and may otherwise deal with the
Company, any Subsidiary of the Company or their respective Affiliates with the
same rights it would have if it were not Trustee.  Any Agent may do the same with like
rights.  However, the Trustee must comply
with Sections 7.10 and 7.11.

 

SECTION 7.04                                            Trustee’s
Disclaimer.

 

The Trustee makes no
representation as to the validity, adequacy or sufficiency of this Indenture,
the Notes, the Intercreditor Agreement or the Collateral Documents, it shall
not be accountable for the Company’s use of the proceeds from the Notes and it
shall not be responsible for any statement of the Company in this Indenture,
the Notes, the Intercreditor Agreement, the Collateral Documents or any other
documents connected with the issuance of the Notes other than the Trustee’s
certificate of authentication, and the Trustee assumes no responsibility for
their correctness.

 

Beyond the exercise of
reasonable care in the custody thereof and the fulfillment of its obligations
under this Indenture and the Collateral Documents, the Trustee shall have no
duty as to any Note Collateral in its possession or control or in the
possession or control of any agent or bailee or any income thereon or as to
preservation of rights against prior parties or any other rights pertaining
thereto.  The Trustee shall be deemed to
have exercised reasonable care in the custody of the Note Collateral in its
possession if the Note Collateral is accorded treatment substantially equal to
that which it accords its own property.

 

The Trustee and the
Collateral Agent each makes no representations as to and shall not be responsible
for the existence, genuineness, value, sufficiency or condition of any of the
Note Collateral or as to the security afforded or intended to be afforded
thereby, hereby or by any Collateral Document, or for the validity, perfection,
priority or enforceability of the Liens or security interests in any of the
Note Collateral created or intended to be created by any of the Collateral
Documents, whether impaired by operation of law or by reason of any action or
omission to act on its part hereunder, except to the extent such action or
omission constitutes gross negligence or willful misconduct on the part of the
Trustee, for the validity or sufficiency of the Note Collateral, any Collateral
Documents or any agreement or assignment contained in any thereof, for the
validity of the title of the Company or any Guarantor to the Note Collateral,
for insuring the Note Collateral or for the payment of taxes, charges,
assessments or Liens upon the Note Collateral or otherwise as to the
maintenance of the Note Collateral.  The
Trustee shall have no duty to ascertain or inquire as to the performance or
observance of any of the terms of this Indenture or any other Collateral
Document by the Company or any other Person that is a party thereto or bound
thereby.

 

101

 

SECTION 7.05                                            Notice of
Default.

 

If a Default or an Event of Default occurs and is
continuing and if a Trust Officer has actual knowledge thereof or has received
written notice thereof from the Company or any Holder, the Trustee shall mail
to each Holder, with a copy to the Company, notice of the Default or Event of
Default within 90 days after the occurrence thereof unless such Default or
Event of Default shall have been cured or waived before the giving of such
notice.  Except in the case of a Default
or an Event of Default in payment of principal of, premium, if any, or interest
on any Note, including an accelerated payment and the failure to make payment
on the Change of Control Payment Date pursuant to a Change of Control Offer,
and except in the case of a failure to comply with Article Five,
the Trustee may withhold the notice if and so long as its Board of Directors,
the executive committee of its Board of Directors or a committee of its
directors and/or Trust Officers in good faith determines that withholding the
notice is in the interest of the Holders.

 

SECTION 7.06                                            Reports by
Trustee to Holders.

 

Within 60 days after each May 15, beginning with May 15, 2011, the Trustee
shall, to the extent that any of the events described in TIA Section 313(a) occurred
within the previous twelve (12) months, but not otherwise, mail to each Holder
a brief report dated as of such date that complies with TIA Section 313(a).  The Trustee also shall comply with TIA
Sections 313(b) and (c).

 

A copy of each report at the
time of its mailing to Holders shall be mailed to the Company and filed by the
Trustee with the SEC and each stock exchange or market, if any, on which the
Notes are listed or quoted.

 

The Company shall promptly
notify the Trustee if the Notes become listed, quoted on or delisted from any
stock exchange or market and the Trustee shall comply with TIA Section 313(d).

 

SECTION 7.07                                            Compensation
and Indemnity.

 

The Company and the
Guarantors, jointly and severally, shall pay to the Trustee, the Collateral
Agent, the Paying Agent and the Registrar (each an “Indemnified
Party”) from time to time compensation for their respective services
as Trustee, Collateral Agent, Paying Agent or Registrar, as the case may be, as
the Trustee, Collateral Agent, Paying Agent, Registrar and the Company shall
have agreed in writing.  The Trustee’s
compensation shall not be limited by any law on compensation of a trustee of an
express trust.  The Company shall
reimburse each Indemnified Party upon request for all reasonable out-of-pocket
expenses, disbursements and advances incurred or made by it in connection with
the performance of its duties under, as the case may be, this Indenture, the
Collateral Documents or the Intercreditor Agreement, except any such expenses,
disbursements and advances as may be attributable to such Indemnified Party’s
negligence (or, in the case of the Collateral Agent, gross negligence), bad
faith or willful misconduct.  Such
expenses, disbursements and advances shall include the reasonable fees,
expenses, disbursements and advances of each of such Indemnified Party’s agents
and counsel.

 

102

 

The Company and the
Guarantors, jointly and severally, hereby agree to indemnify each Indemnified
Party and its agents, employees, stockholders and directors and officers for,
and hold each of them harmless against, any loss, damage, cost, claim,
liability or expense (including taxes, other than taxes based on the income of
such Person) incurred by any of them except for such actions, to the extent
caused by any negligence (or, in the case of the Collateral Agent, gross
negligence), bad faith or willful misconduct on the part of such Indemnified
Party, arising out of or in connection with this Indenture, the Intercreditor
Agreement or the Collateral Documents or the administration of this trust,
including the reasonable costs and expenses of enforcing this Indenture against
the Company or any Guarantor (including this Section 7.07)
and defending themselves against any claim or liability in connection with the
exercise or performance of any of their rights, powers or duties hereunder or
thereunder (including the reasonable fees and expenses of counsel).  The relevant Indemnified Party shall notify
the Company (with a copy to the Trustee) promptly of any claim asserted against
such Indemnified Party for which such Indemnified Party may seek indemnity
hereunder or under the Collateral Documents or Intercreditor Agreement.  Failure by the an Indemnified Party to so
notify the Company shall not relieve the Company or any Guarantor of its
obligations hereunder except to the extent failure to so notify the Company
materially affects its ability to defend against the claim.  At the Indemnified Party’s sole discretion,
the Company shall defend the claim and the Indemnified Party shall cooperate
and may participate in the defense; provided
that any settlement of a claim shall be approved in writing by the Indemnified
Party, which approval shall not be unreasonably withheld.  Alternatively, the Indemnified Party may at
its option have separate counsel of its own choosing and the Company shall pay
the reasonable fees and expenses of such counsel; provided
that the Company shall not be required to pay such fees and expenses if it
assumes the Indemnified Party’s defense and there is no conflict of interest
between the Company and the Indemnified Party in connection with such defense
as reasonably determined by the Indemnified Party.  The Company need not pay for any settlement
made without its written consent, which consent shall not be unreasonably
withheld.  Notwithstanding the foregoing,
the Company and the Guarantors need not reimburse any expense or indemnify
against any loss or liability to the extent incurred by an Indemnified Party
through its negligence (or, in the case of the Collateral Agent, gross
negligence), bad faith or willful misconduct.

 

To secure the Company’s and
each Guarantor’s payment obligations in this Section 7.07,
the Trustee shall have a Lien prior to the Notes on all money or property held
or collected by the Trustee or the Collateral Agent, in its capacity as such,
for any amount owing it or any predecessor Trustee, except money or property
held in trust to pay principal of or interest on any particular Notes.

 

When an Indemnified Party
incurs expenses or renders services after an Event of Default specified in Section 6.01(i) or 6.01 (j) occurs, such expenses (including the reasonable fees
and expenses of its counsel) and the compensation for such services are
intended to constitute expenses of administration under the Bankruptcy Code.

 

The obligations of the
Company under this Section 7.07 shall
survive the satisfaction and discharge of this Indenture, termination of the
Collateral Documents or the Intercreditor Agreement or the resignation or
removal of the Trustee.

 

103

 

The Trustee shall comply
with the provisions of TIA Section 313(b)(2) to the extent
applicable.

 

SECTION 7.08                                            Replacement of
Trustee.

 

The Trustee may resign upon
45 days’ prior written notice to the Company. 
The Holders of a majority in aggregate principal amount of the
outstanding Notes voting as a single class may remove the Trustee by so
notifying the Company and the Trustee in writing and may appoint a successor
Trustee.  The Company, by a resolution of
the Board of Directors, may remove the Trustee if:

 

(a)                                  the Trustee
fails to comply with Section 7.10 or TIA Section 310;

 

(b)                                 the Trustee is
adjudged bankrupt or insolvent;

 

(c)                                  a Custodian or
other public officer takes charge of the Trustee or its property; or

 

(d)                                 the Trustee
becomes incapable of acting with respect to the Notes.

 

If the Trustee resigns or is
removed or if a vacancy exists in the office of Trustee for any reason, the
Company shall promptly appoint a successor Trustee.  Within one (1) year after the successor
Trustee takes office, the Holders of a majority in aggregate principal amount
of the outstanding Notes voting as a single class may appoint a successor
Trustee to replace the successor Trustee appointed by the Company.

 

A successor Trustee shall
deliver a written acceptance of its appointment to the retiring Trustee and to
the Company and thereupon the resignation or removal of the retiring Trustee
shall become effective and such successor Trustee, without any further act,
deed or conveyance, shall become vested with all rights, powers, trusts, duties
and obligations of the retiring Trustee. 
Upon request of the Company or the successor Trustee, such retiring
Trustee shall at the expense of the Company and upon payment of the charges of
the Trustee then unpaid, execute and deliver an instrument transferring to such
successor Trustee all the rights, powers and trusts of the retiring Trustee,
and shall duly assign, transfer and deliver to such successor Trustee all
property and money held by such retiring Trustee hereunder, subject to the
Lien, if any, provided for in Section 7.07.  Upon request of any such successor Trustee or
the Holders of a majority in aggregate principal amount of the outstanding
Notes voting as a single class, the Company shall execute any and all
instruments for more fully and certainly vesting in and confirming to such
successor Trustee all such rights, powers and trusts.

 

If a successor Trustee does
not take office within 30 days after the retiring Trustee resigns or is
removed, the retiring Trustee, the Company or the Holders of at least 10% in
aggregate principal amount of the outstanding Notes voting as a single class
may petition any court of competent jurisdiction at the expense of the Company
for the appointment of a successor Trustee.

 

104

 

If the Trustee fails to
comply with Section 7.10, any Holder
who satisfies the requirements of TIA Section 310(b)(iii) may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.

 

The Company shall give
notice of any resignation and any removal of the Trustee and each appointment
of a successor Trustee to all Holders in writing.  Each notice shall include the name of the
successor Trustee and the address of its Corporate Trust Office.

 

Notwithstanding any
resignation or replacement of the Trustee pursuant to this Section 7.08, the Company’s obligations
under Section 7.07 shall continue for
the benefit of the retiring Trustee.

 

SECTION 7.09                                            Successor
Trustee by Merger, Etc.

 

If the Trustee consolidates
with, merges or converts into, or transfers all or substantially all of its
corporate trust business to, another Person, the resulting, surviving or
transferee Person without any further act shall, if such resulting, surviving
or transferee Person is otherwise eligible hereunder, be the successor Trustee;
provided, however,
that such Person shall be otherwise qualified and eligible under this Article Seven.

 

In case any Notes have been
authenticated, but not delivered, by the Trustee then in office, any successor
by merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Notes so authenticated with the same effect
as if such successor Trustee had itself authenticated such Notes.

 

SECTION 7.10                                            Eligibility;
Disqualification.

 

(a)                                  This Indenture
shall always have a Trustee who satisfies the requirements of TIA Sections
310(a)(1), (2), (3) and (5).  The
Trustee (or, in the case of a Trustee that is an Affiliate of a bank holding
company system, the related bank holding company) shall have a combined capital
and surplus of at least $50,000,000 as set forth in its most recent published
annual report of condition.  In addition,
if the Trustee is a corporation included in a bank holding company system, the
Trustee, independently of such bank holding company, shall meet the capital
requirements of TIA Section 310(a)(2). 
The Trustee shall comply with TIA Section 310(b); provided, however,
that there shall be excluded from the operation of TIA Section 310(b)(1) any
indenture or indentures under which other securities, or certificates of
interest or participation in other securities, of the Company are outstanding
if the requirements for such exclusion set forth in TIA Section 310(b)(1) are
met.  The provisions of TIA Section 310
shall apply to the Company, as obligor of the Notes.

 

(b)                                 If the Trustee
has or acquires a conflicting interest within the meaning of the TIA, the
Trustee shall (1) eliminate such conflict within 90 days, (2) apply
to the SEC for permission to continue as Trustee hereunder (if this Indenture
has been qualified under the TIA) or (3) resign, to the extent and in the
manner provided by, and subject to the provisions of, the TIA and this
Indenture.

 

105

 

SECTION 7.11                                            Preferential
Collection of Claims Against Company.

 

The Trustee shall comply
with TIA Section 311(a), excluding any creditor relationship listed in TIA
Section 311(b).  A Trustee who has
resigned or been removed shall be subject to TIA Section 311(a) to
the extent indicated therein.

 

SECTION 7.12                                            Trustee as
Collateral Agent and Paying Agent.

 

References to the Trustee in
Sections 7.01(e), 7.02, 7.03, 7.04, 7.07 and 7.08
and the first paragraph of Section 7.09
shall include the Trustee in its role as Collateral Agent and Paying Agent.

 

SECTION 7.13                                            Co-Trustees,
Co-Collateral Agent and Separate Trustees, Collateral Agent.

 

(a)                                  At any time or
times, for the purpose of meeting the legal requirements of any jurisdiction in
which any of the Note Collateral may at the time be located, the Company and
the Trustee shall have the power to appoint, and, upon the written request of
the Trustee or of the Holders of at least 25% in principal amount of the Notes
outstanding voting as a single class, the Company shall for such purpose join
with the Trustee in the execution, delivery and performance of all instruments
and agreements necessary or proper to appoint, one or more Persons approved by
the Trustee either to act as co-trustee, jointly with the Trustee, of all or
any part of the Note Collateral, to act as co-collateral agent, jointly with
the Collateral Agent, or to act as separate trustees or Collateral Agent of any
such property, in either case with such powers as may be provided in the
instrument of appointment, and to vest in such Person or Persons in the
capacity aforesaid, any property, title, right or power deemed necessary or
desirable, subject to the other provisions of this Section 7.13.  If the Company does not join in such
appointment within 15 days after the receipt by it of a request so to do, or in
case an Event of Default has occurred and is continuing, the Trustee alone
shall have the power to make such appointment.

 

(b)                                 Should any
written instrument from the Company be required by any co-trustee,
co-Collateral Agent or separate trustee or separate Collateral Agent so
appointed for more fully confirming to such co-trustee or separate trustee such
property, title, right or power, any and all such instruments shall, on
request, be executed, acknowledged and delivered by the Company.

 

(c)                                  Every
co-trustee, co-collateral agent or separate trustee or separate collateral
agent shall, to the extent permitted by law, but to such extent only, be
appointed subject to the following terms, namely:

 

(1)                                          The Notes shall
be authenticated and delivered, and all rights, powers, duties and obligations
hereunder in respect of the custody of securities, cash and other personal
property held by, or required to be deposited or pledged with, the Trustee
hereunder, shall be exercised solely, by the Trustee.

 

106

 

(2)                                          The rights,
powers, duties and obligations hereby conferred or imposed upon the Trustee
shall be conferred or imposed upon and exercised or performed by the Trustee or
by the Trustee and such co-trustee or separate trustee, or by the Collateral
Agent and such co-Collateral Agent or separate Collateral Agent, jointly as
shall be provided in the instrument appointing such co-trustee or separate
trustee or co-Collateral Agent or separate Collateral Agent, except to the
extent that under any law of any jurisdiction in which any particular act is to
be performed the Trustee shall be incompetent or unqualified to perform such
act, in which event such rights, powers, duties and obligations shall be
exercised and performed by such co-trustee or separate trustee, Collateral
Agent or co-Collateral Agent or separate Collateral Agent.

 

(3)                                          The Trustee at
any time, by an instrument in writing executed and delivered by it, with the
concurrence of the Company evidenced by a resolution of the Company’s Board of
Directors, may accept the resignation of or remove any co-trustee or separate
trustee appointed under this Section 7.13, and, in case an Event of
Default has occurred and is continuing, the Trustee shall have power to accept
the resignation of, or remove, any such co-trustee, co-collateral agent,
separate trustee or separate collateral agent without the concurrence of the Company.  Upon the written request of the Trustee, the
Company shall join with the Trustee in the execution, delivery and performance
of all instruments and agreements necessary or proper to effectuate such
resignation or removal.  A successor to
any co-trustee, co-collateral agent, separate trustee or separate collateral
agent so resigned or removed may be appointed in the manner provided in this Section 7.13.

 

(4)                                          No co-trustee,
co-collateral agent, separate trustee or separate collateral agent hereunder shall
be personally liable by reason of any act or omission of the Trustee or the
Collateral Agent, or any other such trustee or collateral agent hereunder.

 

(5)                                          Any act of
Holders delivered to the Trustee shall be deemed to have been delivered to each
such co-trustee or separate trustee and any act of Holders delivered to the
Collateral Agent shall be deemed to have been delivered to each such
co-collateral agent or separate collateral agent.

 

ARTICLE EIGHT

SATISFACTION AND DISCHARGE OF INDENTURE

 

SECTION 8.01                                            Legal
Defeasance and Covenant Defeasance.

 

(a)                                  The Company may, at its option and at any
time, elect to have either clause (b) or (c) below be
applied to the outstanding Notes upon compliance with the applicable conditions set forth in clause (d).

 

107

 

(b)                                 Upon the
Company’s exercise under clause (a) of the option applicable to
this clause (b), subject to the satisfaction of the conditions set forth
in clause (d) below, the Company and the Guarantors shall be deemed
to have been released and discharged from their obligations with respect to the
outstanding Notes, the Note Guarantees and the Collateral Documents on the date
the applicable conditions set forth below are satisfied (“Legal Defeasance”).  For this purpose, such Legal Defeasance means
that the Company shall be deemed to have paid and discharged the entire
Indebtedness represented by the outstanding Notes, which shall thereafter be
deemed to be “outstanding” only for the purposes of the Sections and matters
under this Indenture referred to in subclauses (1) and (2) below,
and the Company and the Guarantors shall be deemed to have satisfied all their
other obligations under such Notes and this Indenture, the Note Guarantees and
the Collateral Documents, except for the following which shall survive until
otherwise terminated or discharged hereunder: (1) the rights of Holders of
outstanding Notes to receive solely from the trust fund described in clause (d) below
and as more fully set forth in such paragraph payments in respect of the
principal of, premium, if any, and interest on such Notes when such payments
are due; (2) obligations listed in Section 8.03, subject to
compliance with this Section 8.01; (3) the rights, powers,
trusts, duties and immunities of the Trustee and the Company’s obligations in
connection therewith; and (4) this Article Eight.  The Company may exercise its option under
this clause (b) notwithstanding the prior exercise of its option
under clause (c) below with respect to the Notes.

 

(c)                                  Upon the
Company’s exercise under clause (a) of the option applicable to
this clause (c), subject to the satisfaction of the conditions set forth
in clause (d) below, the Company and its Restricted Subsidiaries
shall be released and discharged from their obligations under any covenant
contained in Sections 4.04, 4.05, 4.07, 4.08, 4.10
through 4.24, 4.26 through 4.29 and 4.31 and clause
(4) of the first paragraph of Section 5.01 on and after
the date the conditions set forth below are satisfied (“Covenant Defeasance”),
and the Notes shall thereafter be deemed to be not “outstanding” for the
purpose of any direction, waiver, consent or declaration or act of Holders (and
the consequences of any thereof) in connection with such covenants, but shall
continue to be deemed “outstanding” for all other purposes hereunder (it being
understood that such Notes shall not be deemed outstanding for accounting
purposes).  For this purpose, such
Covenant Defeasance means that, with respect to the outstanding Notes and the
Note Guarantees, the Company may omit to comply with and shall have no
liability in respect of any term, condition or limitation set forth in any such
covenant, whether directly or indirectly, by reason of any reference elsewhere
herein to any such covenant or by reason of any reference in any such covenant
to any other provision herein or in any other document and such omission to
comply shall not constitute a Default or an Event of Default under Section 6.01,
but, except as specified above, the remainder of this Indenture and such Notes
shall be unaffected thereby.  In
addition, upon the Company’s exercise under clause (a) above of the
option applicable to this clause (c), subject to the satisfaction of the
conditions set forth in clause (d) below, Sections 6.01(d) (solely
as such Section 6.01(d) pertains to clause (4) of
the first paragraph of Section 5.01 or Section 10.04), 6.01(e) (solely
as such Section 6.01(e) pertains to Sections 4.04,
4.05, 4.07, 4.08, 4.10 through 4.24, 4.26
through 4.29 and 4.31 and clause (4) of the first
paragraph of Section 5.01), 6.01(f), 6.01(g), 6.01(h),
6.01(k) and 6.01(l) shall not constitute Events of
Default.

 

108

 

(d)                                 The following
shall be the conditions to application of either clause (b) or (c) above
to the outstanding Notes:

 

(1)                                          the Company
shall have irrevocably deposited with the Trustee, in trust, for the benefit of
the Holders, U.S. Legal Tender or non-callable U.S. Government Obligations or a
combination thereof, in such amounts and at such times as are sufficient, in
the opinion of a nationally-recognized firm of independent public accountants,
to pay the principal of, premium, if any, and interest on the outstanding Notes
on the stated date for payment or redemption, as the case may be;

 

(2)                                          in the case of
Legal Defeasance, the Company shall have delivered to the Trustee an Opinion of
Counsel in the United States of America in form reasonably satisfactory to the
Trustee confirming that:

 

(i)                                     the Company has received
from, or there has been published by, the Internal Revenue Service a ruling; or

 

(ii)                                  since the date of this
Indenture, there has been a change in the applicable federal income tax law,

 

in either case to the effect that, and based thereon
such Opinion of Counsel shall confirm that, the Holders will not recognize
income, gain or loss for U.S. federal income tax purposes as a result of such
Legal Defeasance and will be subject to federal income tax on the same amounts,
in the same manner and at the same times as would have been the case if such
Legal Defeasance had not occurred;

 

(3)                                          in the case of
Covenant Defeasance, the Company shall have delivered to the Trustee an Opinion
of Counsel in the United States of America reasonably acceptable to the Trustee
confirming that the Holders will not recognize income, gain or loss for U.S.
federal income tax purposes as a result of such Covenant Defeasance and will be
subject to U.S. federal income tax on the same amounts, in the same manner and
at the same times as would have been the case if such Covenant Defeasance had
not occurred;

 

(4)                                          no Default or
Event of Default shall have occurred and be continuing on the date of such
deposit pursuant to subclause (1) above (except such Default or
Event of Default resulting from the failure to comply with Section 4.12
or Section 4.20 as a result of the borrowing of funds required to
effect such deposit);

 

(5)                                          such Legal
Defeasance or Covenant Defeasance shall not result in a breach of, or
constitute a default under any other material agreement or instrument to which
the Company or any of its Subsidiaries is a party or by which the Company or
any of its Subsidiaries is bound;

 

(6)                                          the Company
shall have delivered to the Trustee an Officers’ Certificate stating that the
deposit was not made by the Company with the intent of 

 

109

 

preferring the Holders over any other creditors of
the Company or with the intent of defeating, hindering, delaying or defrauding
any other creditors of the Company or others;

 

(7)                                          the Company
shall have delivered to the Trustee an Opinion of Counsel to the effect that,
assuming no intervening bankruptcy of the Company between the date of deposit
and the 91st day following the date of deposit and assuming that no Holder is
an insider of the Company, after the 91st day following the date of deposit,
the trust funds will not be subject to the effect of any applicable bankruptcy,
insolvency or similar laws affecting creditors’ rights generally; and

 

(8)                                          the Company
shall have delivered to the Trustee an Officers’ Certificate and an Opinion of
Counsel, each stating that all conditions precedent provided for or relating to
the Legal Defeasance or the Covenant Defeasance have been complied with.

 

Notwithstanding the
foregoing, the Opinion of Counsel required by Section 8.01(d)(2) above
with respect to a Legal Defeasance need not be delivered if all Notes not
theretofore delivered to the Trustee for cancellation (A) have become due
and payable or (B) shall become due and payable on the Maturity Date
within one (1) year under arrangements satisfactory to the Trustee for the
giving of notice of redemption by the Trustee in the name, and at the expense,
of the Company.

 

In the event all or any
portion of the Notes are to be redeemed through such irrevocable trust, the
Company shall make arrangements reasonably satisfactory to the Trustee, at the
time of such deposit, for the giving of the notice of such redemption or
redemptions by the Trustee in the name and at the expense of the Company.

 

(e)                                  Upon a Legal
Defeasance or Covenant Defeasance, each Guarantor will be released and relieved
of any obligations under its Note Guarantee, and any security for the Notes
(other than the trust fund described in Section 8.05) will be
released as provided under Section 12.06.

 

SECTION 8.02                                            Satisfaction
and Discharge.

 

In addition to the Company’s rights under Section 8.01, this Indenture (subject to Section 8.03) and the Collateral Documents
will be discharged and will cease to be of further effect as to all outstanding
Notes, when:

 

(a)                                  either:

 

(1)                                          all the Notes
theretofore authenticated and delivered (except lost, stolen or destroyed Notes
which have been replaced or paid as provided in Section 2.07 and
Notes for whose payment money has theretofore been deposited in trust or
segregated and held in trust by the Company and thereafter repaid to the
Company or discharged from such trust) have been delivered to the Trustee for
cancellation; or

 

110

 

(2)                                          all Notes not
theretofore delivered to the Trustee for cancellation (i) have become due
and payable by reason of the mailing of a notice of redemption or (ii) (A) shall
become due and payable at their Stated Maturity within one (1) year or (B) are
to be called for redemption within one (1) year under arrangements
reasonably satisfactory to the Trustee, and the Company or any Guarantor has
irrevocably deposited or caused to be deposited with the Trustee funds in trust
solely for the benefit of the Holders U.S. Legal Tender, non-callable U.S.
Government Obligations, or a combination of U.S. Legal Tender and non-callable
U.S. Government Obligations in an amount sufficient, without consideration of
any reinvestment of interest, to pay and discharge the entire Indebtedness on
the Notes not theretofore delivered to the Trustee for cancellation, for
principal of, and premium, if any, and interest on the Notes to the date of
stated maturity or such redemption, as the case may be;

 

(b)                                 all other sums
payable under this Indenture and the Collateral Documents by the Company or any
Guarantor have been paid;

 

(c)                                  the Company has
delivered irrevocable instruments to the Trustee under this Indenture to apply
the deposited money toward the payment of the Notes at Stated Maturity or on
the Redemption Date, as the case may be; and

 

(d)                                 the Company has
delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel
stating that all conditions precedent under this Indenture relating to the
satisfaction and discharge of this Indenture have been complied with.

 

Upon such a satisfaction and
discharge of the Indenture, each Guarantor will be released and relieved of any
obligations under its Note Guarantee, and any security for the Notes (other
than the trust fund described in Section 8.05) will be released as
provided under Section 12.06.

 

SECTION 8.03                                            Survival of
Certain Obligations.

 

Notwithstanding the
occurrence of Legal Defeasance under Section 8.01
or the satisfaction and discharge of this Indenture and the Collateral
Documents under Section 8.02, the
respective obligations of the Company and the Trustee under Sections 2.02,
2.03, 2.04,
2.05, 2.06,
2.07, 2.10, 2.11, 2.12, 2.13, 2.14, 2.15, 2.16
and 6.07, Article Seven
and Sections 8.05, 8.06 and 8.07 shall survive until the Notes are no longer
outstanding, and thereafter the obligations of the Company and the Trustee
under Sections 7.07, 8.05, 8.06 and 8.07
shall survive.

 

SECTION 8.04                                            Acknowledgment
of Discharge by Trustee.

 

Subject to Section 8.07, after the conditions of clauses
(a), (b), (c) and (d) of Section 8.02
have been satisfied, each of the Trustee and the Collateral Agent upon written
request shall acknowledge in writing the discharge of the Company’s obligations
under this Indenture except for those surviving obligations specified in Section 8.03.

 

111

 

SECTION 8.05                                            Application of
Trust Moneys.

 

The Trustee shall hold any
U.S. Legal Tender or U.S. Government Obligations deposited with it in the irrevocable
trust established pursuant to Section 8.01
or 8.02. 
The Trustee shall apply the deposited U.S. Legal Tender or the U.S.
Government Obligations, together with earnings thereon, through the Paying
Agent, in accordance with this Indenture and the terms of the irrevocable trust
agreement established pursuant to Section 8.01
or 8.02, to the payment of principal of,
premium, if any, and interest on the Notes. 
Anything in this Article Eight
to the contrary notwithstanding, the Trustee shall deliver or pay to the
Company from time to time upon the Company’s request any U.S. Legal Tender or
U.S. Government Obligations held by it as provided in Section 8.01(d) or
8.02(a)(2) which, in the opinion of a nationally-recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee, are in excess of the amount thereof that would then
be required to be deposited to effect an equivalent Legal Defeasance or
Covenant Defeasance or satisfaction and discharge, respectively, of this
Indenture.

 

SECTION 8.06                                            Repayment to
the Company of Unclaimed Money.

 

Subject to any applicable
abandoned property laws, the Trustee and the Paying Agent shall pay to the
Company, upon receipt by the Trustee or the Paying Agent, as the case may be,
of a written request from the Company, any money held by it for the payment of
principal, premium, if any, or interest that remains unclaimed for two (2) years
after payment to the Holders is required, without interest thereon; provided, however,
that the Trustee and the Paying Agent before being required to make any payment
may, but need not, at the expense of the Company cause to be published once in
a newspaper of general circulation in The City of New York or mail to each
Holder entitled to such money notice that such money remains unclaimed and that
after a date specified therein, which shall be at least 30 days from the date
of such publication or mailing, any unclaimed balance of such money then
remaining shall be repaid to the Company, without interest thereon.  After payment to the Company, Holders
entitled to money must look solely to the Company for payment as general
creditors unless an applicable abandoned property law designated another
Person, and all liability of the Trustee or Paying Agent with respect to such
money shall thereupon cease.

 

SECTION 8.07                                            Reinstatement.

 

If the Trustee or Paying
Agent is unable to apply any U.S. Legal Tender or U.S. Government Obligations
in accordance with Section 8.01 or 8.02 by reason of any legal proceeding or by
reason of any order or judgment of any court or governmental authority
enjoining, restraining or otherwise prohibiting such application, the Company’s
and each Guarantor’s obligations under this Indenture, the Collateral
Documents, the Note Guarantees and the Notes shall be revived and reinstated as
though no deposit had occurred pursuant to Section 8.01
or 8.02 until such time as the Trustee or
Paying Agent is permitted to apply all such U.S. Legal Tender or U.S.
Government Obligations in accordance with Section 8.01
or 8.02; provided,
however, that if the Company has made any
payment of premium, if any, or interest on or principal of any Notes because of
the reinstatement of its obligations, the Company shall be subrogated to the
rights of the Holders of such Notes to receive such payment from the U.S. Legal
Tender or U.S. Government Obligations held by the Trustee or Paying Agent.

 

112

 

SECTION 8.08                                            Indemnity for
Government Obligations.

 

The Company shall pay and
indemnify the Trustee against any tax, fee or other charge imposed on or
assessed against the U.S. Government Obligations deposited pursuant to Section 8.01 or Section 8.02
or the principal and interest received in respect thereof other than any such
tax, fee or other charge which by law is for the account of the Holders.

 

ARTICLE NINE

AMENDMENTS, SUPPLEMENTS AND WAIVERS

 

SECTION 9.01                                            Without Consent
of Holders.

 

From time to time, the
Company, the Guarantors, the Trustee and, if such amendment, waiver or
supplement relates to any Collateral Document, the Collateral Agent, without
the consent of the Holders, may amend, waive or supplement provisions of this
Indenture, the Collateral Documents and the Notes:

 

(1)                                          to cure any
ambiguity, defect, or inconsistency contained herein or therein;

 

(2)                                          to provide for
uncertificated Notes in addition to or in place of certificated Notes;

 

(3)                                          to provide for
the assumption of the obligations of the Company or any Guarantor to Holders in
accordance with Section 5.01 or Section 10.04, as the
case may be (and, if applicable, the discharge and release of the predecessor
Company in accordance with Section 5.02);

 

(4)                                          to make any
change that would provide any additional rights or benefits to the Holders or
that does not adversely affect in any material respect the legal rights of any
such Holder under the Indenture Documents or the Intercreditor Agreement;

 

(5)                                          to comply with
requirements of the SEC in order to effect or maintain the qualification of
this Indenture under the TIA;

 

(6)                                          to add any
additional assets to the Note Collateral;

 

(7)                                          to allow any
Subsidiary to become a Guarantor or any other Person to guarantee the Notes;

 

(8)                                          to comply with
the rules of any applicable securities depositary;

 

(9)                                          to provide for
a successor Trustee or co-trustees in accordance with the terms of this
Indenture or to otherwise comply with any requirement of this Indenture;

 

113

 

(10)         to provide for the
issuance of Additional Notes in accordance with this Indenture;

 

(11)         to release a
Guarantor from its Note Guarantee and the Collateral Documents as permitted and
in accordance with this Indenture;

 

(12)         to reflect the grant
of Liens on the Note Collateral for the benefit of an additional secured party,
to the extent that such Indebtedness and the Lien securing such Indebtedness is
permitted by the terms of this Indenture; or

 

(13)         to release Note
Collateral from the Lien of this Indenture and the Collateral Documents when
permitted or required by this Indenture or the Collateral Documents (including
in the case where such Note Collateral constitutes Secondary Collateral, the
Intercreditor Agreement).

 

After
an amendment, waiver or supplement under this Section 9.01 becomes
effective, the Company shall mail to the Holders affected thereby a notice
briefly describing the amendment or supplement. Any failure of the Company to
mail such notice, or any defect therein, shall not, however, in any way impair
or affect the validity of such amendment, waiver or supplement.

 

SECTION 9.02                                            With Consent of Holders.

 

Subject
to Sections 2.09 and 6.07, the Company, the Guarantors and the
Trustee and, if such amendment or supplement relates to a Collateral Document,
the Collateral Agent, as applicable, together, with the written consent of the
Holders of at least a majority in aggregate principal amount of the outstanding
Notes voting as a single class (including consents obtained in connection with a
purchase of, or tender offer or exchange offer for, Notes) may amend or
supplement this Indenture, the Notes, the Collateral Document or the Note
Guarantees without notice to any other Holder. 
Subject to Sections 2.09 and 6.07, the Holders of a
majority in aggregate principal amount of the outstanding Notes voting as a
single class (including consents obtained in connection with a purchase of, or
tender offer or exchange offer for, Notes) may waive any existing Default or
Event of Default or compliance by the Company with any provision of this
Indenture, the Collateral Documents or the Notes without notice to any other
Holder.  However, no amendment,
supplement or waiver, including a waiver pursuant to Section 6.04,
shall without the consent (including consents obtained in connection with a
purchase of, or tender offer or exchange offer for, Notes) of:

 

(a)           each Holder affected
thereby (with respect to any Notes held by a non-consenting Holder):

 

(1)           reduce
the principal amount of Notes whose Holders must consent to an amendment,
supplement or waiver of any provision of this Indenture, the Notes, the
Collateral Documents or the Note Guarantees;

 

(2)           reduce
the principal of or change the fixed maturity of any Note or alter the
provisions set forth in Article Three;

 

114

 

(3)           reduce
the rate of or change the time for payment of interest (including default
interest) on any Note;

 

(4)           waive
a Default or Event of Default in the payment of principal of, or interest or
premium, if any, on the Notes (except a rescission and cancellation of
acceleration of the Notes and the consequences thereof by Holders holding at
least a majority in aggregate principal amount of Notes then outstanding voting
as a single class and a waiver of the payment default that resulted from such
acceleration as provided in Section 6.02);

 

(5)           make
any Notes payable in currency other than that stated in this Indenture;

 

(6)           make
any change in the provisions of this Indenture relating to waivers of past
Defaults (other than to add sections of this Indenture subject thereto) or the
rights of Holders to receive payments of principal of, or interest or premium,
if any, on the Notes when due and payable;

 

(7)           amend,
change or modify in any material respect the obligation of the Company to make
and consummate a Change of Control Offer after the occurrence of a Change of
Control or make and consummate a Repurchase Offer or modify any of the
provisions or definitions with respect thereto;

 

(8)           release
any Guarantor from any of its obligations under its Note Guarantee or this
Indenture or any Collateral Document, except in accordance with the terms of
this Indenture;

 

(9)           contractually
subordinate the Notes or any Note Guarantee in right of payment to any other
Indebtedness; or

 

(10)         make
any change to Section 9.01 or this Section 9.02; and

 

(b)           the Holders holding
at least 75% in aggregate principal amount of the outstanding Notes voting as a
single class, adversely change the priority of the Holders’ Liens in the Note
Collateral or release all or substantially all of the Note Collateral from the
Liens created by the Collateral Documents except as specifically provided for
in this Indenture and the Collateral Documents.

 

It
shall not be necessary for the consent of the Holders under this Section 9.02
to approve the particular form of any proposed amendment, supplement or waiver,
but it shall be sufficient if such consent approves the substance thereof.

 

After
an amendment, supplement or waiver under this Section 9.02 becomes
effective, the Company shall mail to the Holders affected thereby a notice
briefly describing the amendment, supplement or waiver.  Any failure of the Company to mail such
notice, or any defect therein, shall not, however, in any way impair or affect
the validity of any such amendment, supplement or waiver.

 

115

 

SECTION 9.03                                            Compliance with TIA.

 

Every
amendment, waiver or supplement of this Indenture, the Notes or any Collateral
Document shall comply with the TIA as then in effect.

 

SECTION 9.04                                            Revocation and Effect of Consents.

 

Until
an amendment, waiver or supplement becomes effective, a consent to it by a
Holder is a continuing consent by the Holder and every subsequent Holder of a
Note or portion of a Note that evidences the same debt as the consenting
Holder’s Note, even if notation of the consent is not made on any Note.  Subject to the following paragraph, any such
Holder or subsequent Holder may revoke the consent as to such Holder’s Note or
portion of such Note by written notice to the Trustee and the Company received
before the date on which the Trustee and, if such amendment, waiver or
supplement relates to any Collateral Document, the Collateral Agent receives an
Officers’ Certificate certifying that the Holders of the requisite principal
amount of Notes have consented (and not theretofore revoked such consent) to
the amendment, waiver or supplement.

 

The
Company may, but shall not be obligated to, fix a record date for the purpose
of determining the Holders entitled to consent to any amendment, supplement or
waiver, which record date shall be, at the Company’s election, either
(a) at least 30 days prior to the first solicitation of such consent or
(b) the date of the most recent list furnished to the Trustee under Section 2.05.  If a record date is fixed, then
notwithstanding the last sentence of the immediately preceding paragraph, those
Persons who were Holders at such record date (or their duly designated
proxies), and only those Persons, shall be entitled to revoke any consent
previously given, whether or not such Persons continue to be Holders after such
record date.  No such consent shall be
valid or effective for more than 90 days after such record date.

 

A
consent to any amendment, supplement or waiver under this Indenture, the Notes
or any Collateral Document by any Holder given in connection with a purchase,
tender or exchange of such Holder’s Notes shall not be rendered invalid by such
purchase, tender or exchange.

 

After an
amendment, supplement or waiver becomes effective, it shall bind every Holder
unless it makes a change described in clause (a) of Section 9.02,
in which case, the amendment, supplement or waiver shall bind only each Holder
of a Note who has consented to it and every subsequent Holder of a Note or
portion of a Note that evidences the same debt as the consenting Holder’s Note;
provided that any such waiver shall not impair or affect the right of
any Holder to receive payment of principal of, premium, if any, and interest on
a Note, on or after the respective due dates expressed in such Note, or to
bring suit for the enforcement of any such payment on or after such respective
dates without the consent of such Holder.

 

SECTION 9.05                                            Notation on or Exchange of Notes.

 

If an
amendment, supplement or waiver changes the terms of a Note, the Trustee may
require the Holder of the Note to deliver the Note to the Trustee.  The Trustee at the written direction of the
Company may place an appropriate notation on the Note regarding the changed
terms and return it to the Holder and the Trustee may place an appropriate
notation on any Note thereafter authenticated. 
Alternatively, if the Company or the Trustee so determines, the 

 

116

 

Company in exchange for
the Note shall execute, issue and deliver and, upon receipt of an
Authentication Order in accordance with Section 2.02, the Trustee
shall authenticate a new Note that reflects the changed terms.  Failure to make an appropriate notation, or
issue a new Note, shall not affect the validity and effect of such amendment,
supplement or waiver.  Any such notation
or exchange shall be made at the sole cost and expense of the Company.

 

SECTION 9.06                                            Trustee or Collateral Agent to Sign
Amendments, Etc.

 

The
Trustee or the Collateral Agent, as applicable, shall execute and deliver any
amendment, supplement or waiver authorized pursuant to this Article Nine;
provided that the Trustee or the Collateral Agent, as the case may be,
may, but shall not be obligated to, execute and deliver any such amendment,
supplement or waiver which adversely affects the rights, duties or immunities
of the Trustee or the Collateral Agent, as the case may be, under this
Indenture or any Collateral Document.  The
Trustee or the Collateral Agent, as the case may be, shall be entitled to
receive, and shall be fully protected in relying upon, an Opinion of Counsel
and an Officers’ Certificate each stating that the execution and delivery of
any amendment, supplement or waiver authorized pursuant to this Article Nine
is authorized or permitted by this Indenture. 
Such Opinion of Counsel shall also state that the amendment, supplement
or waiver is a valid and enforceable obligation of the Company (subject to
customary exceptions).  Such Opinion of
Counsel shall not be an expense of the Trustee or the Collateral Agent, as the
case may be, and shall be paid for by the Company.

 

SECTION 9.07                                            Acts of Holders.

 

(a)           Any request, demand,
authorization, direction, notice, consent, waiver or other action provided in
or pursuant to this Indenture to be given, made or taken by Holders may be
embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such Holders in person or by an agent duly appointed in
writing; and, except as herein otherwise expressly provided, such action shall
become effective when such instrument or instruments are delivered to the
Trustee and, where it is hereby expressly required, to the Company.  Such instrument or instruments (and the
action embodied therein and evidenced thereby) are herein sometimes referred to
as the “Act” of the Holders signing such instrument or instruments.  Proof of execution of any such instrument or
of a writing appointing any such agent shall be sufficient for any purpose of
this Indenture and (subject to Section 7.01) conclusive in favor of
the Trustee and the Company, if made in the manner provided in this Section 9.07.

 

Without limiting the generality of this Section 9.07,
unless otherwise provided in or pursuant to this Indenture: (i) a Holder,
including a Depository or its nominee that is a Holder of a Global Note, may
give, make or take, by an agent or agents duly appointed in writing, any
request, demand, authorization, direction, notice, consent, waiver or other
action provided in or pursuant to this Indenture to be given, made or taken by
Holders, and a Depository or its nominee that is a Holder of a Global Note may
duly appoint in writing as its agent or agent members of, or participants in,
such Depository holding interests in such Global Note in the records of such
Depository; and (ii) with respect to any Global Note the Depository for
which is DTC, any consent or other action given, made or taken by an Agent
Member of DTC by electronic means in accordance with the 

 

117

 

Automated
Tender Offer Procedures system or other customary procedures of, and pursuant
to authorization by, DTC shall be deemed to constitute the “Act” of the Holder
of such Global Note, and such “Act” shall be deemed to have been delivered to
the Company and the Trustee upon the delivery by DTC of an “agent’s message” or
other notice of such consent or other action having been so given, made or
taken in accordance with the customary procedures of DTC.

 

(b)           The fact and date of
the execution by any Person of any such instrument or writing may be proved by
the affidavit of a witness of such execution or by a certificate of a notary
public or other officer authorized by law to take acknowledgments of deeds,
certifying that the individual signing such instrument or writing acknowledged
to him the execution thereof.  Where such
execution is by a Person acting in a capacity other than such Person’s
individual capacity, such certificate or affidavit shall also constitute
sufficient proof of the authority of the Person executing the same.  The fact and date of the execution of any
such instrument or writing, or the authority of the Person executing the same,
may also be proved in any other manner which the Trustee deems sufficient.

 

(c)           The ownership of
Notes shall be proved by the Register.

 

(d)           Without limiting the
foregoing, a Holder entitled hereunder to give, make or take any action
hereunder with regard to any particular Note may do so, or duly appoint in
writing any Person or Persons as its agent or agents to do so, with regard to
all or any part of the principal amount of such Note.

 

ARTICLE TEN

 

GUARANTEE

 

SECTION 10.01                                      Guarantee.

 

Each
Guarantor hereby, jointly and severally, unconditionally and irrevocably
guarantees (such guarantee to be referred to herein as the “Note Guarantee”)
to each of the Holders and to the Trustee and the Collateral Agent and their
respective successors and assigns that: (a) the principal of, premium, if
any, and interest on the Notes shall be promptly paid in full when due, subject
to any applicable grace period, whether upon redemption pursuant to the terms
of the Notes, by acceleration or otherwise, and interest on the overdue
principal (including interest accruing at the then applicable rate provided in
the Indenture Documents after the occurrence of any Event of Default set forth
in Section 6.01(i) or 6.01(j), 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), if any, and interest on any interest, if any, to the extent
lawful, of the Notes and all other obligations of the Company to the Holders,
the Trustee and the Collateral Agent hereunder, thereunder or under any
Collateral Document or the Intercreditor Agreement shall be promptly paid in
full or performed, all in accordance with the terms hereof, thereof and of the
Collateral Documents and Intercreditor Agreement; and (b) in case of any
extension of time of payment or renewal of any of the Notes or of any such
other obligations, the same shall be promptly paid in full when due or
performed in accordance with the terms of the extension or renewal, subject to
any applicable grace period, whether at stated 

 

118

 

maturity, by acceleration
or otherwise; subject, however, in the case of clauses (a) and (b)
above, to the limitations set forth in Section 10.03.  The Note Guarantee of each Guarantor shall
rank senior in right of payment to all existing and future subordinated
Indebtedness of such Guarantor that expressly provides such Indebtedness shall
be so subordinate and equal in right of payment with all other existing and future
senior obligations of such Guarantor, including borrowings or guarantees of
borrowings under the ABL Facility.  Each
Guarantor hereby agrees that its obligations hereunder shall be unconditional,
irrespective of the validity, regularity or enforceability of the Notes, this
Indenture, any Collateral Document or the Intercreditor Agreement, the absence
of any action to enforce the same, any waiver or consent by any of the Holders
with respect to any provisions hereof or thereof, any release of any other
Guarantor, the recovery of any judgment against the Company, any action to
enforce the same or any other circumstance which might otherwise constitute a
legal or equitable discharge or defense of a Guarantor.  Each Guarantor hereby waives diligence, presentment,
demand of payment, filing of claims with a court in the event of insolvency or
bankruptcy of the Company, any right to require a proceeding first against the
Company, protest, notice and all demands whatsoever and covenants that this
Note Guarantee shall not be discharged except by complete performance of the
obligations contained in the Notes, this Indenture and in this Note
Guarantee.  If the Trustee, the
Collateral Agent or any Holder is required by any court or otherwise to return
to the Company, any Guarantor, or any Custodian or other similar official
acting in relation to the Company or any Guarantor, any amount paid by the
Company or any Guarantor to the Trustee, the Collateral Agent or such Holder,
this Note Guarantee, to the extent theretofore discharged, shall be reinstated
in full force and effect.  Each Guarantor
further agrees that, as between each Guarantor, on the one hand, and the
Holders, the Collateral Agent and the Trustee, on the other hand, (x) the
maturity of the obligations guaranteed hereby may be accelerated as provided in
Article Six for the purposes of this Note Guarantee notwithstanding
any stay, injunction or other prohibition preventing such acceleration in
respect of the obligations guaranteed hereby, and (y) in the event of any
acceleration of such obligations as provided in Article Six, such
obligations (whether or not due and payable) shall forthwith become due and
payable by each Guarantor for the purpose of this Note Guarantee.

 

SECTION 10.02                                      Release of a Guarantor.

 

Notwithstanding
the foregoing, a Guarantor will be automatically and unconditionally released
from its Note Guarantee and the Collateral Documents without any action
required on the part of the Trustee or any Holder:

 

(a)           in connection with
any sale or other disposition of all or substantially all of the assets of that
Guarantor (including by way of merger, consolidation or otherwise) to a Person
that is not (either before or after giving effect to such transaction) the
Company or a Restricted Subsidiary of the Company, if the sale or other
disposition complies with the applicable provisions of this Indenture;

 

(b)           in connection with
any sale or other disposition of all of the Capital Stock of a Guarantor by the
Company or a Restricted Subsidiary of the Company to a Person that is not
(either before or after giving effect to such transaction) the Company or a
Restricted Subsidiary of the Company, if the sale or other disposition complies
with the applicable provisions of this Indenture;

 

119

 

(c)           if the Company
designates any Restricted Subsidiary that is a Guarantor to be an Unrestricted
Subsidiary in accordance with the applicable provisions of this Indenture;

 

(d)           if the Company
exercises its Legal Defeasance option or its Covenant Defeasance option as
described in Section 8.01; or

 

(e)           upon satisfaction
and discharge of this Indenture or payment in full of the principal and
premium, if any, and accrued and unpaid interest on the Notes and all other
Note Obligations that are then due and payable.

 

The
Trustee or the Collateral Agent, as applicable, shall promptly deliver an
instrument evidencing such release in form reasonably satisfactory to the
Trustee or the Collateral Agent, as applicable, upon receipt of a request by
the Company accompanied by an Officers’ Certificate certifying as to the
compliance with this Section 10.02. 
Any Guarantor not so released remains liable for the full amount of its
Note Guarantee as provided in this Article Ten.

 

SECTION 10.03                                      Limitation of Guarantor’s Liability.

 

Each
Guarantor and, by its acceptance hereof, each of the Holders hereby confirms
that it is the intention of all such parties that the guarantee by such
Guarantor pursuant to its Note Guarantee not constitute a fraudulent transfer
or conveyance for purposes of any Bankruptcy Code, the Uniform Fraudulent
Conveyance Act, the Uniform Fraudulent Transfer Act or any similar federal or
state law.  To effectuate the foregoing
intention, the Holders and each Guarantor hereby irrevocably agree that the
obligations of such Guarantor under the Note Guarantee shall be limited to the
maximum amount as shall, after giving effect to all other contingent and fixed
liabilities of such Guarantor and after giving effect to any collections from
or payments made by or on behalf of any other Guarantor in respect of the
obligations of such other Guarantor under its Note Guarantee or pursuant to Section 10.05,
result in the obligations of such Guarantor under the Note Guarantee not
constituting such fraudulent transfer or conveyance.

 

SECTION 10.04                                      Guarantors May Consolidate, etc., on Certain
Terms.

 

Each
Guarantor will not, and the Company will not cause or permit any Guarantor to,
sell or otherwise dispose of all or substantially all of its assets to, or
consolidate with or merge with or into (whether or not such Guarantor is the
surviving Person), any Person other than the Company or any other Guarantor
unless:

 

(a)           immediately after
giving effect to that transaction, no Default or Event of Default exists; and

 

(b)           either:

 

(1)           the
Person acquiring the property in any such sale or disposition or the Person
formed by or surviving any such consolidation or merger (if other than the
Guarantor or the Company):

 

120

 

(i)            is
a Person organized and existing under the laws of the United States of America
or any state thereof or the District of Columbia; and

 

(ii)           assumes
all the obligations of such Guarantor under this Indenture and any Collateral
Documents to which such Guarantor is a party pursuant to a supplemental
indenture substantially in the form of Exhibit G hereto and in
connection therewith shall execute and deliver such other agreements, cause
such instruments and Uniform Commercial Code financing statements to be filed
and recorded in such jurisdictions and take such other actions as may be
required by applicable law to continue the validity and enforceability, and
perfect or continue the perfection, of the Note Lien created under the Collateral
Documents on the Note Collateral owned by or transferred to such Person; or

 

(2)           in
the case of any such sale or disposition (including by way of any such
consolidation or merger), such sale or disposition complies with Section 4.16;
and

 

(c)           the Company shall
have delivered to the Trustee an Officers’ Certificate and an Opinion of
Counsel, each stating that the consummation of such consolidation, merger,
sale, assignment, transfer, conveyance or other disposition and, if such an
assumption is required in connection with such transaction, such assumption,
complies with the applicable provisions of this Indenture and that all
conditions precedent in this Indenture relating to such transaction have been
satisfied.

 

SECTION 10.05                                      Contribution.

 

In
order to provide for just and equitable contribution among the Guarantors, the
Guarantors agree, inter se, that each Guarantor that makes a payment or
distribution under a Note Guarantee shall be entitled to a pro  rata
contribution from each other Guarantor hereunder based on the net assets of
each other Guarantor.  The preceding
sentence shall in no way affect the rights of the Holders of the Notes to the
benefits of this Indenture, the Notes or the Note Guarantees.

 

SECTION 10.06                                      Waiver of Subrogation.

 

Each
Guarantor agrees that it shall not be entitled to any right of subrogation in
relation to the Holders in respect of any obligations guaranteed hereby until
payment in full of all obligations guaranteed hereby.

 

SECTION 10.07                                      Waiver of Stay, Extension or Usury Laws.

 

Each
Guarantor covenants to the extent permitted by law that it shall not at any
time insist upon or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law or any usury law or other
law that would prohibit or forgive such Guarantor from performing its Note
Guarantee as contemplated herein, wherever enacted, now or at any time
hereafter in force, or which may affect the covenants or the performance of
this Note 

 

121

 

Guarantee; and each
Guarantor hereby expressly waives to the extent permitted by law all benefit or
advantage of any such law, and covenants that it shall not hinder, delay or
impede the execution of any power herein granted to the Trustee, but shall
suffer and permit the execution of every such power as though no such law had
been enacted.

 

SECTION 10.08                                      Note Guarantee Evidenced by Indenture; No Notation of
Note Guarantee.

 

The
Note Guarantee of any Guarantor shall be evidenced solely by its execution and
delivery of this Indenture (or, in the case of any Guarantor that is not party
to this Indenture on the Issue Date, a supplemental indenture thereto) and not
by an endorsement on, or attachment to, any Note of any Note Guarantee or
notation thereof.  To effect any Note
Guarantee of any Guarantor not a party to this Indenture on the Issue Date,
such future Guarantor shall execute and deliver a supplemental indenture
substantially in the form of Exhibit G hereto, which supplemental
indenture shall be executed and delivered on behalf of such Guarantor by an
Officer of such Guarantor.

 

Each
Guarantor hereby agrees that its Note Guarantee set forth in Section 10.01
shall be and remain in full force and effect notwithstanding any failure to
endorse on any Note a notation of such Note Guarantee.

 

The
delivery of any Note by the Trustee, after the authentication thereof
hereunder, shall constitute due delivery of the Note Guarantees set forth in
this Indenture on behalf of each of the Guarantors.

 

ARTICLE ELEVEN

 

MISCELLANEOUS

 

SECTION 11.01                                      Trust Indenture Act Controls.

 

If any
provision of this Indenture limits, qualifies or conflicts with the duties
imposed by TIA Section 318(c), such TIA-imposed duties shall control.  If any provision of this Indenture limits,
qualifies or conflicts with another provision which is required to be included
in this Indenture by the TIA, the required provision shall control.  If any provision of this Indenture modifies
or excludes any provision of the TIA that may be so modified or excluded, the
provision of the TIA shall be deemed to apply to this Indenture as so modified
or shall be excluded, as the case may be. 
Any provision of the TIA which is required to be included in a qualified
Indenture, but not expressly included herein, shall be deemed to be included by
this reference.  Notwithstanding anything
to the contrary in this paragraph, the Company will not be required to comply
with all or any portion of TIA Section 314(b) or 314(d) if it
determines, in good faith based on an Opinion of Counsel (which opinion may be
a reasoned opinion and which opinion shall also be delivered to the Trustee),
that under the terms of TIA Section 314(b) or Section 314(d), as
applicable, or any interpretation or guidance as to the meaning thereof of the
SEC and its staff, including “no action” letters or exemptive orders, all or
any portion of TIA Section 314(b) or Section 314(d) is
inapplicable.

 

122

 

SECTION 11.02                                      Notices.

 

Any
notices or other communications required or permitted hereunder or under any
Collateral Document shall be in writing, and shall be sufficiently given if
made by hand delivery, by telex, by telecopier, by email or other electronic
format (including in portable document format (.pdf)), by overnight courier or
registered or certified mail, postage prepaid, return receipt requested,
addressed as follows:

 

if
sent other than by registered or certified mail to the Company or any
Guarantor:

 

Aventine
Renewable Energy Holdings, Inc.

120
North Parkway Drive

Pekin,
IL 61554

Attention:      Corporate
Controller

 General Counsel

Facsimile Number: 
(309) 478-1535

 

if
sent by registered or certified mail to the Company or any Guarantor:

 

Aventine
Renewable Energy Holdings, Inc.

P. O. Box 1800

Pekin, IL 61555-1800

Attention:      Corporate
Controller

 General Counsel

Facsimile Number: 
(309) 478-1535

 

if to
the Trustee:

 

Wilmington
Trust FSB

Corporate
Capital Markets

50
South Sixth Street, Suite 1290

Minneapolis,
MN 55402

Attention:  Aventine Administrator

Facsimile
Number:  612-217-5651

 

if to
the Collateral Agent:

 

Wilmington
Trust FSB

Corporate
Capital Markets

50
South Sixth Street, Suite 1290

Minneapolis,
MN 55402

Attention:  Aventine Administrator

Facsimile
Number:  612-217-5651

 

Each
of the Company, any Guarantor, the Collateral Agent or the Trustee by written
notice to each other may designate additional or different addresses for
notices to such Person.  Any notice or
communication to the Company, any Guarantor, the Collateral Agent or the

 

123

 

Trustee shall be deemed
to have been given or made (whether or not the addressee receives it) as of the
date so delivered if personally delivered; when receipt is acknowledged, if
faxed, emailed or sent in other electronic form; one (1) Business Day
after mailing if sent by overnight courier guaranteeing next day delivery; and
five (5) calendar days after mailing if sent by registered or certified
first class mail, postage prepaid and return receipt requested, in each case to
the address shown above or designated as specified above (except that a notice
of change of address shall not be deemed to have been given until actually
received by the addressee).

 

Any
notice or communication mailed to a Holder shall be mailed to such Holder by
registered or certified first class mail, postage prepaid and return receipt
requested, or by overnight air courier guaranteeing next day delivery at such
Holder’s address as it appears on the registration books of the Registrar and
shall be sufficiently given to such Holder if so mailed within the time
prescribed (whether or not the addressee receives it).  Any notice or communication shall also be so
mailed to any Person described in TIA Section 313(c), to the extent
required by the TIA.

 

Failure
to mail a notice or communication to a Holder or any defect in it shall not
affect its sufficiency with respect to other Holders.

 

If the
Company mails a notice or communication to Holders, it shall mail a copy to the
Trustee and each Agent at the same time.

 

Where
this Indenture provides for notice in any manner, such notice may be waived in
writing by the Person entitled to receive such notice, either before or after
the event, and such waiver shall be the equivalent of such notice. Waivers of
notice by Holders shall be filed with the Trustee, but such filing shall not be
a condition precedent to the validity of any action taken in reliance upon such
waiver.

 

Where
this Indenture provides for notice of any event to a Holder of a Global Note,
such notice shall be sufficiently given if given to the Depository for such
Note (or its designee), pursuant to its Applicable Procedures, not later than
the latest date (if any), and not earlier than the earliest date (if any),
prescribed for the giving of such notice.

 

SECTION 11.03                                      Communications by Holders with Other
Holders.

 

Holders
may communicate pursuant to TIA Section 312(b) with other Holders
with respect to their rights under this Indenture, any Collateral Document, any
Note Guarantee or the Notes.  The
Company, the Trustee, the Collateral Agent, the Registrar and any other Person
shall have the protection of TIA Section 312(c).

 

SECTION 11.04                                      Certificate and Opinion as to Conditions
Precedent.

 

Upon
any request or application by the Company or any Guarantor to the Trustee or
the Collateral Agent, as the case may be, to take any action under this
Indenture, any Collateral Document or any other Indenture Document, the Company
shall furnish to the Trustee or the Collateral Agent, as the case may be, upon
request:

 

124

 

(a)           an Officers’
Certificate (which shall include the statements set forth in Section 11.05),
in form and substance reasonably satisfactory to the Trustee or the Collateral
Agent, as the case may be, stating that, in the opinion of the signers, all
conditions precedent to be performed by the Company or the applicable Guarantor
(as the case may be), if any, provided for in this Indenture, any Collateral
Document, the Notes or the Note Guarantees relating to the proposed action have
been complied with; and

 

(b)           an Opinion of
Counsel (which shall include the statements set forth in Section 11.05)
stating that, in the opinion of such counsel, all such conditions precedent to
be performed by the Company or the applicable Guarantor (as the case may be),
if any, provided for in this Indenture, any Collateral Document and the Notes
relating to the proposed action have been complied with.

 

SECTION 11.05                                      Statements Required in Certificate or
Opinion.

 

Each
certificate or opinion with respect to compliance with a condition or covenant
provided for in this Indenture or any Collateral Document, other than the
Officers’ Certificate required by Section 4.06, shall include:

 

(a)           a statement that the
Person making such certificate or opinion has read such covenant or condition;

 

(b)           a brief statement as
to the nature and scope of the examination or investigation upon which the
statements or opinions contained in such certificate or opinion are based;

 

(c)           a statement that, in
the opinion of such Person, he has made such examination or investigation as is
reasonably necessary to enable him to express an informed opinion as to whether
or not such covenant or condition has been complied with; and

 

(d)           a statement as to
whether or not, in the opinion of such Person, such condition or covenant has
been complied with.

 

In any
case where several matters are required to be certified by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters be
certified by, or covered by the opinion of, only one such Person, or that they
be so certified or covered by only one document, but one such Person may
certify or give an opinion with respect to some matters and one or more other
such Persons as to other matters, and any such Person may certify or give an
opinion as to such matters in one or several documents.

 

Any
certificate or opinion of an officer of any Person may be based, insofar as it
relates to legal matters, upon a certificate or opinion of, or representations
by, counsel, unless such officer knows, or in the exercise of reasonable care
should know, that the certificate or opinion or representations with respect to
the matters upon which his certificate or opinion is based are erroneous.  Any such certificate or opinion of, or
representation by, counsel or any Opinion of Counsel may be based, insofar as
it relates to factual matters, upon certificates of public officials or upon a
certificate or opinion of, or representations by, an officer or officers of the
Company or 

 

125

 

any Guarantor (including
an Officers’ Certificate) stating that the information with respect to such
factual matters is in the possession of the Company or such Guarantor unless
such counsel knows, or in the exercise of reasonable care should know, that the
certificate or opinion or representations with respect to such matters are
erroneous.

 

Where
any Person is required to make, give or execute two or more applications,
requests, consents, certificates, statements, opinions or other instruments
under this Indenture, they may, but need not, be consolidated and form one
instrument.

 

SECTION 11.06                                      Rules by Trustee, Paying Agent,
Registrar.

 

The
Trustee may make reasonable rules in accordance with the Trustee’s customary
practices for action by or at a meeting of Holders.  The Paying Agent or Registrar may make
reasonable rules for its functions.

 

SECTION 11.07                                      Legal Holidays.

 

A “Legal
Holiday” used with respect to a particular place of payment is a Saturday,
a Sunday or a day on which banking institutions in New York, New York, Chicago,
Illinois or at such place of payment are not required to be open.  If a payment date is a Legal Holiday at such
place, payment may be made at such place on the next succeeding day that is not
a Legal Holiday, and no interest shall accrue for the intervening period.

 

SECTION 11.08                                      Governing Law.

 

THIS
INDENTURE, THE NOTES, THE COLLATERAL DOCUMENTS (OTHER THAN THE MORTGAGES) AND
THE GUARANTEES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN THE
STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS (OTHER THAN
N.Y. GEN. OBL. LAW § 5-1401).  EACH OF
THE PARTIES HERETO AGREES TO SUBMIT TO THE JURISDICTION OF THE COURTS OF THE
STATE OF NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO
THIS INDENTURE, THE NOTES, THE GUARANTEES, THE COLLATERAL DOCUMENTS (OTHER THAN
THE MORTGAGES) OR THE TRANSACTIONS CONTEMPLATED BY THIS INDENTURE.

 

SECTION 11.09                                      No Adverse Interpretation of Other
Agreements.

 

This
Indenture may not be used to interpret another indenture, loan or debt
agreement of the Company or any of its Subsidiaries.  Any such indenture, loan or debt agreement
may not be used to interpret this Indenture.

 

SECTION 11.10                                      No Recourse Against Others.

 

No
Affiliate, director, manager, officer, employee, incorporator, member or holder
of any Equity Interests in the Company, a Guarantor or the Trustee or any
direct or indirect parent of the Company, a Guarantor or the Trustee, as such,
will have any liability for any obligations of the Company or any Guarantor
under the Notes, this Indenture, the Note Guarantees or the Collateral 

 

126

 

Documents, or for any
claim based on, in respect of, or by reason of, such obligations or their
creation.  Each Holder of the Notes by
accepting a Note waives and releases all such liability.  The waiver and release are part of the
consideration for issuance of the Notes and the Note Guarantees.  The parties hereto acknowledge that such
waiver may not be effective to waive liabilities under the federal securities
laws.

 

SECTION 11.11                                      Successors.

 

All
agreements of the Company and the Guarantors in this Indenture, the Notes and
the Note Guarantees shall bind their respective successors.  All agreements of the Trustee and the
Collateral Agent in this Indenture shall bind their respective successors.

 

SECTION 11.12                                      Duplicate Originals.

 

All
parties may sign any number of copies of this Indenture.  Each signed copy shall be an original, but
all of them together shall represent the same agreement.

 

SECTION 11.13                                      Severability.

 

In
case any one or more of the provisions in this Indenture, the Notes or the other
Indenture Documents shall be held invalid, illegal or unenforceable, in any
respect for any reason, the validity, legality and enforceability of any such
provision in every other respect and of the remaining provisions shall not in
any way be affected or impaired thereby, it being intended that all of the
provisions hereof shall be enforceable to the full extent permitted by law.

 

SECTION 11.14                                      Waiver of Jury Trial.

 

EACH
OF THE COMPANY, THE GUARANTORS, THE TRUSTEE, THE COLLATERAL AGENT, AND BY ITS
ACCEPTANCE THEREOF, EACH HOLDER OF A NOTE, HEREBY IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY LAW, ANY RIGHT TO TRIAL BY JURY IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR IN CONNECTION WITH THIS INDENTURE, THE COLLATERAL
DOCUMENTS, THE NOTES, THE NOTE GUARANTEES OR THE TRANSACTIONS CONTEMPLATED BY
THIS INDENTURE.

 

SECTION 11.15                                      Table of Contents, Headings, etc.

 

The
Table of Contents, Cross-Reference Table and headings of the Articles and
Sections of this Indenture have been inserted for convenience of reference
only, are not to be considered a part of this Indenture and shall in no way
modify or restrict any of the terms or provisions hereof.

 

127

 

ARTICLE TWELVE

 

SECURITY

 

SECTION 12.01                                      Grant of Security Interest.

 

(a)           The due and punctual
payment of the Note Obligations when and as the same shall be due and payable,
whether on an Interest Payment Date, at maturity, by acceleration, purchase,
repurchase, redemption or otherwise, and the performance of all other Note
Obligations of the Company and the Guarantors to the Holders, the Collateral
Agent or the Trustee under this Indenture, the Collateral Documents, the Note
Guarantees and the Notes are secured as provided in the Collateral Documents
which the Company and the Guarantors have entered into simultaneously with the
execution of this Indenture and will be secured by Collateral Documents
hereafter delivered as required or permitted by this Indenture.  Subject to the Intercreditor Agreement, the
Collateral Documents shall provide for the grant by the Company and Guarantors
party thereto to the Collateral Agent of security interests in the Note
Collateral.

 

(b)           Each Holder, by its
acceptance of any Notes and Note Guarantees, hereby (i) authorizes the
Trustee and the Collateral Agent, as applicable, on behalf of and for the
benefit of such Holder, to be the agent for and representative of such Holder
with respect to the Note Guarantees, the Note Collateral and the Collateral
Documents and (ii) irrevocably appoints the Collateral Agent to act as
such Holder’s agent and Collateral Agent under the Intercreditor Agreement.

 

(c)           The Trustee and each
Holder, by its acceptance of any Notes and Note Guarantees: (i) consents
and agrees to, and agrees to be bound by, the terms of each Collateral
Document, as the same may be in effect or may be amended from time to time in
accordance with their respective terms; (ii) authorizes and directs the
Collateral Agent to enter into this Indenture and the Collateral Documents and
authorizes and empowers the Collateral Agent to bind the Holders of the Notes
and other holders of Note Obligations as set forth in the Collateral Documents
and the Intercreditor Agreement to perform its obligations and exercise its
rights thereunder in accordance therewith; and (iii) irrevocably
authorizes the Collateral Agent to perform the duties and exercise the rights,
powers and discretions that are specifically given to it hereunder or under the
Collateral Documents or the Intercreditor Agreement, together with any other
incidental rights, power and discretions; provided, however, that
the Collateral Agent shall be under no duty or obligation to (x) take any
actions or (y) exercise any such rights, powers and discretions, in each
case, that are discretionary with the Collateral Agent in accordance with the
Indenture Documents, unless directed to do so in writing by Holders of at least
25% in aggregate principal amount of the Notes then outstanding voting as a
single class.  The Company shall, and shall
cause each of its Domestic Subsidiaries to, do or cause to be done, at its sole
cost and expense, all such actions and things as may be required by the
provisions of the Collateral Documents, or which the Collateral Agent from time
to time may reasonably request, to assure and confirm to the Collateral Agent
the security interests in the Note Collateral contemplated by the Collateral
Documents so as to render the same available for the security and benefit of
this Indenture and of the Note 

 

128

 

Obligations
secured hereby, according to the intent and purpose herein and therein
expressed and subject to the Intercreditor Agreement.  The Company shall, and shall cause each of
its Domestic Subsidiaries to, take any and all commercially reasonable actions
required or as may be reasonably requested by the Collateral Agent to
(x) cause the Collateral Documents to create and maintain, as security for
the Note Obligations, valid and enforceable, perfected security interests in
and on all the Note Collateral, in favor of the Collateral Agent, for the
benefit of itself and the Trustee and the Holders, superior to and prior to the
rights of all third Persons and subject to no other Liens, in each case, except
for Permitted Collateral Liens and (y) comply with the applicable
provisions of the TIA.  If required for
the purpose of meeting the legal requirements of any jurisdiction in which any
of the Note Collateral may at the time be located, the Company, the Trustee and
the Collateral Agent shall have the power to appoint, and shall take all
reasonable action to appoint, one or more Persons approved by the Trustee and
reasonably acceptable to the Company to act as co-Collateral Agent with respect
to any such Note Collateral, with such rights and powers limited to those
deemed necessary for the Company, the Trustee or the Collateral Agent to comply
with any such legal requirements with respect to such Note Collateral, and
which rights and powers shall not be inconsistent with the provisions of this
Indenture or any Indenture Document.  At
any time and from time to time, the Company shall, and shall cause each of its
Restricted Subsidiaries to, promptly execute, acknowledge and deliver such
Collateral Documents, instruments, certificates, notices and other documents
and take such other actions as shall be required by law or any Collateral
Document, or which the Collateral Agent may reasonably request, to create,
perfect, protect, assure or enforce the Liens and benefits intended to be
conferred as contemplated by this Indenture for the benefit of the holders of
the Note Obligations.  The Company shall
from time to time promptly pay all reasonable financing and continuation
statement recording or filing fees, charges and taxes relating to this
Indenture, the Collateral Documents and any other instruments of further
assurance required pursuant hereto or thereto.

 

(d)           Subject to and in
accordance with the provisions of the Collateral Documents and this Indenture,
so long as the Collateral Agent or (solely with respect to any Secondary
Collateral) any Credit Facility Agent has not exercised their respective rights
with respect to the Note Collateral upon the occurrence and during the
continuance of an Event of Default, the Company and each Guarantor will have
the right to remain in possession and retain exclusive control of the Note
Collateral (other than any cash, securities, obligations and Cash Equivalents
constituting part of the Note Collateral that may be deposited with the Collateral
Agent or (solely with respect to any Secondary Collateral) any Credit Facility
Agent in accordance with the provisions of the Collateral Documents and other
than as set forth in the Collateral Documents), to operate the Note Collateral,
to alter or repair the Note Collateral and to collect, invest and dispose of
any income therefrom, subject, in the case of the Secondary Collateral, to the
provisions of the Intercreditor Agreement and the Credit Facility Lien Security
Documents.  Upon the occurrence and
continuance of an Event of Default, the Collateral Agent or (solely with
respect to any Secondary Collateral) any Credit Facility Agent will be entitled
to foreclose upon and sell the Note Collateral or any part thereof as provided
in the Collateral Documents or (solely with respect to any Secondary
Collateral) the ABL Facility Lien Security Documents.

 

129

 

(e)           Anything contained
in this Indenture or the Collateral Documents to the contrary notwithstanding,
each Holder hereby agrees that no Holder shall have any right individually to
realize upon any of the Note Collateral, it being understood and agreed that
all powers, rights and remedies of the Trustee hereunder may be exercised
solely by the Trustee in accordance with the terms hereof and all powers,
rights and remedies in respect of the Note Collateral under the Collateral
Documents may be exercised solely by the Collateral Agent.

 

(f)            Subject to the
provisions of the Collateral Documents and Section 6.05 of this
Indenture, the Trustee may, in its sole discretion and without the consent of
the Holders, on behalf of the Holders, direct, on behalf of the Holders, the
Collateral Agent to take all actions it deems necessary or appropriate in order
to (i) enforce any of its rights or any of the rights of the Holders under
the Collateral Documents and (ii) collect and receive any and all amounts
payable in respect of the Note Collateral in respect of the obligations of the
Company and the Guarantors hereunder and thereunder. Subject to the provisions
of the Collateral Documents, the Trustee shall have the power to institute and
to maintain such suits and proceedings as it may deem expedient to prevent any
impairment of the Note Collateral by any acts that may be unlawful or in
violation of the Collateral Documents or this Indenture, and such suits and
proceedings as the Trustee may deem expedient to preserve or protect its
interest and the interests of the Holders in the Note Collateral (including
power to institute and maintain suits or proceedings to restrain the
enforcement of or compliance with any legislative or other governmental
enactment, rule or order that may be unconstitutional or otherwise invalid
if the enforcement of, or compliance with, such enactment, rule or order
would impair the security interest hereunder or be prejudicial to the interests
of the Holders or the Trustee).

 

(g)           Where any provision
of this Indenture or any Collateral Document requires that additional property
or assets be added to the Note Collateral, the Company shall, no later than the
Note Collateral Required Date with respect to such property or assets (and
subject to any provision hereof requiring any earlier action): (x) cause a
valid and enforceable and (except solely as to Excluded Personal Property)
perfected first priority Lien on or in such property or assets (subject only to
Permitted Collateral Liens) to vest in the Collateral Agent, as security for
the Note Obligations, and (y) deliver to the Trustee and the Collateral Agent
the following:

 

(i)            unless
such property or assets constitute Note Collateral Non-Specified Covered
Property, a request from the Company that such property or assets be added to
the Note Collateral;

 

(ii)           unless
such property or assets constitute Note Collateral Non-Specified Covered
Property, an Officers’ Certificate to the effect that the Note Collateral being
added is in the form, consists of the assets and is in the amount (if any)
required by this Indenture;

 

(iii)          unless
such property or assets constitute Note Collateral Covered Property or real
property, Collateral Documents adding such property or assets as Note
Collateral, which Collateral Documents shall be 

 

130

 

dated no later than such Note Collateral Required Date and, based on
the type and location of the property subject thereto, substantially in the
form and with substantially the terms of the applicable Collateral Documents
entered into on the Issue Date (such Collateral Documents (or financing
statements in respect thereof) having been duly received for recording in the
appropriate filing, recording or registry office);

 

(iv)          to
the extent such property or assets constitute real property, a Mortgage with
respect to such property or assets, dated no later than such Note Collateral
Required Date and substantially in the form attached as Exhibit H
hereto (with such changes thereto as are customarily acceptable to holders of
mortgages on real property in the jurisdiction where such real property is
located) (such Mortgage having been duly received for recording in the
appropriate filing or recording office);

 

(v)           to
the extent such property or assets constitute real property, title and extended
coverage insurance covering such property or assets, in an amount equal to no
less than the Fair Market Value of such property or assets;

 

(vi)          unless
such property or assets constitute Note Collateral Covered Property, such
financing statements or other filings or recording instruments, if any, as the
Company shall deem necessary to perfect the Collateral Agent’s Lien in such
Note Collateral;

 

(vii)         unless
such property or assets constitute Note Collateral Covered Property,
appropriate Opinions of Counsel (of scope and substance, and subject to
customary exceptions, substantially the same as the Issue Date Opinions) with
respect to, among other things, the creation, validity, perfection and (solely
as to certificated securities and instruments) priority of the Collateral
Agent’s Lien on such property or assets and as to the due authorization,
execution, delivery, validity and enforceability of such Mortgage (to the
extent such property or assets constitute real property) or Collateral
Documents (to the extent such property or assets do not constitute real property)
pursuant to which the Collateral Agent’s Lien has been or is being granted; and

 

(viii)        unless
such property or assets constitute Note Collateral Non-Specified Covered
Property, an Officers’ Certificate and Opinion of Counsel to the effect that
all conditions precedent provided for in this Indenture to, and any other
requirements provided for in this Indenture (including pursuant to this Section 12.01(g))
in respect of, the addition of such property or assets to the Note Collateral
have been complied with (it being understood that in any event such Opinion of
Counsel pursuant to this clause (viii) and any Opinion of Counsel
pursuant to clause (vii) above or the following paragraph may
expressly state that no opinion is 

 

131

 

expressed therein as to priority of any Lien on any Note Collateral
(except solely as to certificated securities and instruments)).

 

The
Company shall, at the same time as the Company is required to furnish to the
Trustee and the Collateral Agent the Opinion of Counsel required pursuant to Section 12.03(b),
deliver to the Trustee and the Collateral Agent an Officers’ Certificate and
Opinion of Counsel to the effect that, as to any property or assets required by
any provision of this Indenture or any Collateral Document to be added to the
Note Collateral on or after the Issue Date and prior to the date thereof and as
to which an Officers’ Certificate and Opinion of Counsel have not previously
been delivered pursuant to clause (viii) of the preceding paragraph
or pursuant to this paragraph of this Section 12.01(g), all
conditions precedent provided for in this Indenture to the addition of such
property or assets to, and any other requirements provided for in the Indenture
(including pursuant to this Section 12.01(g)) in respect of, the
addition of such property or assets to the Note Collateral have been complied
with.

 

(h)           Each of the
Collateral Agent and the Trustee is authorized and empowered to receive for the
benefit of the Holders of the Notes any funds collected or distributed to the
Collateral Agent or the Trustee under the Collateral Documents and, subject to
the terms of the Collateral Documents, the Trustee is authorized and empowered
to make further distributions of such funds to the Holders of the Notes
according to the provisions of this Indenture.

 

(i)            Each Holder of the
Notes, by its acceptance thereof, authorizes and directs the Trustee and the
Collateral Agent to enter into one or more amendments to the Intercreditor
Agreement or enter into any amendments or supplements to the Collateral
Documents in accordance with the provisions of this Indenture, the
Intercreditor Agreement and the Collateral Documents.

 

(j)            In the event that
the Company shall issue Additional Notes pursuant to clause (c) of
the fourth paragraph of Section 2.02, the net proceeds from any
such issuance shall constitute “Collateral Monies” and shall be
immediately deposited into the Collateral Account pending their use by the
Company or any Guarantor to acquire Additional Assets that become Primary
Collateral simultaneously with the acquisition thereof by the Company or such
Guarantor, as applicable, or as otherwise specified in Section 12.11.

 

(k)           The Company shall,
and shall cause each Domestic Subsidiary to, make all filings (including
filings of continuation statements and amendments to UCC financing statements
that may be necessary to continue the effectiveness of such UCC financing
statements) and all other actions as are necessary or required by the Collateral
Documents to maintain (at the sole cost and expense of the Company and its
Domestic Subsidiaries) the security interest created by the Collateral
Documents in the Note Collateral (other than with respect to any Note
Collateral the security interest in which is not required to be perfected under
the Collateral Documents) as a perfected first priority security interest
subject only to Permitted Collateral Liens.

 

132

 

(l)            The Trustee and the
Company hereby acknowledge and agree that the Trustee or the Collateral Agent,
as the case may be, holds the Note Collateral in trust for the benefit of the
Trustee and the Holders, in each case pursuant to the terms of the Collateral
Documents and the Intercreditor Agreement.

 

(m)          If the Company or any
Restricted Subsidiary fails to do so, the Collateral Agent shall, pursuant to
the terms of the Collateral Documents, be irrevocably authorized and empowered,
with full power of substitution, to execute, acknowledge and deliver such
security agreements, instruments, certificates, notices and other documents
and, subject to the terms of this Indenture and the Collateral Documents, take
such other actions in the name, place and stead of the Company or such
Restricted Subsidiary, but the Collateral Agent shall have no obligation to do
so and no liability for any action taken or omitted by it in good faith in
connection therewith.

 

(n)           If the Company or
any Guarantor grants a Lien on any of its property or assets (including any
Capital Stock) for the benefit of any holders of Credit Facility Obligations,
the Company or such Guarantor, respectively, shall also simultaneously grant a
Lien in such property or assets (including Capital Stock) in favor of the
Collateral Agent for the benefit of the Trustee and the Holders so that such
property or assets become Note Collateral.

 

SECTION 12.02                                      Intercreditor Agreement.

 

This
Indenture and the Collateral Documents are subject to the terms, limitations
and conditions set forth in the Intercreditor Agreement.  The Trustee and by its acceptance of its
Note(s), each Holder, (a) acknowledges that it has received a copy of the
Intercreditor Agreement, (b) consents to the subordination of Liens on the
Second Lien Collateral as defined, and provided for, in the Intercreditor
Agreement, (c) agrees that it will be bound by and will take no actions
contrary to the provisions of the Intercreditor Agreement and
(d) authorizes and instructs the Collateral Agent to enter into the
Intercreditor Agreement as agent for and representative of such Secured
Party.  The foregoing provisions are
intended as an inducement to the lenders under the Credit Facility to extend
credit to the borrowers thereunder and such lenders are intended third party
beneficiaries of such provisions.  If any
conflict or inconsistency exists between this Indenture and the Intercreditor
Agreement, the Intercreditor Agreement shall govern.  If any conflict or inconsistency exists
between this Indenture and any Collateral Document (other than the
Intercreditor Agreement), this Indenture shall govern.

 

SECTION 12.03                                      Recording and Opinions.

 

(a)           The Company shall
furnish to the Trustee, at such time as required by TIA Section 314(b), an
Opinion of Counsel either (1) stating that, in the opinion of such
counsel, this Indenture and the Collateral Documents and any financing
statements and other instruments have been properly recorded, registered and
filed to the extent necessary to perfect the security interests created by the
Collateral Documents (to the extent such security interests may be perfected by
a recording, registering or filing) and reciting the details of such action or
referring to prior Opinions of Counsel in which such

 

133

 

details are given
or (2) stating that, in the opinion of such counsel, no such action is
necessary to perfect any security interest created under any of the Collateral
Documents.

 

(b)           The Company shall
furnish to the Trustee and the Collateral Agent (if other than the Trustee), on
or within one month of June 30 of each year, commencing June 30,
2011, an Opinion of Counsel either (1) stating that, in the opinion of
such counsel, all action necessary to perfect or continue the perfection of the
security interests created by the Collateral Documents (to the extent such
security interests may be perfected by a recording, registering or filing) has
been taken and reciting the details of such action or referring to prior
Opinions of Counsel in which such details are given or (2) stating that,
in the opinion of such counsel, no such action is necessary to perfect or
continue the perfection of any security interest created under any of the
Collateral Documents.

 

SECTION 12.04                                      Release of Note Collateral.

 

(a)           Subject to the
Intercreditor Agreement, the Collateral Agent shall not at any time release
Note Collateral from the security interests created by the Collateral Documents
unless such release is in accordance with Section 12.04(b), 12.04(d),
12.05, 12.06, or 12.11.

 

(b)           So long as no
Default or Event of Default under this Indenture shall have occurred and be
continuing or would result therefrom and so long as such transaction would not
violate this Indenture, the Company and the Guarantors may, in the ordinary
course of business and to the extent permitted by applicable law, without any
release or consent by the Trustee, the Collateral Agent or any Holder, sell or
otherwise dispose of inventory or collect accounts receivable or sell or
otherwise dispose of equipment that has become worn out, defective or obsolete
or not used or useful in the business of the Company and its Subsidiaries and
which is, to the extent required by this Indenture or the Collateral Documents,
replaced by property of substantially equivalent or greater value which becomes
subject to the Note Lien of the Collateral Documents.  The Company will deliver to the Trustee,
within 30 calendar days following the end of each year, an Officers’
Certificate to the effect that all releases during the preceding 12-month
period in which no release or consent of the Trustee was obtained were in the
ordinary course of business and were not prohibited by this Indenture or any
Collateral Document.

 

(c)           The release of any
Note Collateral from the terms of the Collateral Documents shall not be deemed
to impair the security under this Indenture in contravention of the provisions
hereof if and to the extent the Note Collateral is released pursuant to Section 12.04(b),
12.04(d), 12.05, 12.06, or 12.11 or otherwise pursuant
to this Indenture and the Collateral Documents or pursuant to the Intercreditor
Agreement.  To the extent applicable, the
Company shall cause TIA Section 314(d) relating to the release of
property from the security interests created by this Indenture and the
Collateral Documents to be complied with. 
Any certificate or opinion required by TIA Section 314(d) may
be made by an Officer of the Company, except in cases where TIA
Section 314(d) requires that such certificate or opinion be made by
an independent Person, which Person shall be an independent engineer, appraiser
or other expert selected or approved 

 

134

 

by the Trustee in
the exercise of reasonable care.  A
Person is “independent” if such Person (1) is in fact independent,
(2) does not have any direct financial interest or any material indirect
financial interest in the Company or in any Affiliate of the Company and
(3) is not an officer, employee, promoter, underwriter, trustee, partner
or director or person performing similar functions to any of the foregoing for
the Company.  The Trustee and the
Collateral Agent shall be entitled to receive and rely upon a certificate
provided by any such Person confirming that such Person is independent within
the foregoing definition.

 

(d)           Notwithstanding any
other provision of any Indenture Document, the consent and release of the
Collateral Agent, the Trustee or any Holder will not be required for the sale
or other disposition of Secondary Collateral in accordance with the terms of
the ABL Facility or any other Credit Facility subject to compliance with the
Intercreditor Agreement.

 

(e)           At any time when an
Event of Default has occurred and is continuing and the maturity of the Notes
has been accelerated (whether by declaration or otherwise) and the Trustee has
delivered a notice of acceleration to the Collateral Agent, no release of Note
Collateral pursuant to the provisions of this Indenture or the Collateral
Documents will be effective as against the Holders, except (solely with respect
to Secondary Collateral) as otherwise provided in the Intercreditor Agreement.

 

SECTION 12.05                                      Specified Releases of Note Collateral.

 

Subject
to Section 12.04, any asset included in the Note Collateral may be
released from the Note Liens at any time or from time to time in accordance
with the provisions of the Collateral Documents, including the Intercreditor
Agreement, upon the request of the Company pursuant to an Officers’ Certificate
certifying that all conditions precedent hereunder and under the Collateral
Documents have been met and without the consent of the Collateral Agent, the
Trustee or any Holder, under any one or more of the following circumstances:

 

(a)           upon delivery by the
Company to the Collateral Agent of an Officers’ Certificate certifying that the
asset has been sold or otherwise disposed of by the Company or a Restricted
Subsidiary to a Person other than the Company or a Guarantor in a transaction
permitted by this Indenture, at the time of such sale or disposition; or

 

(b)           upon delivery by the
Company to the Collateral Agent of an Officers’ Certificate certifying that the
asset is owned or has been acquired by a Guarantor that has been released from
its Note Guarantee (including by virtue of (x) a Guarantor becoming an
Unrestricted Subsidiary or (y) a sale by the Company or a Subsidiary
thereof of all of the Capital Stock of a Guarantor); or

 

(c)           upon delivery by the
Company to the Collateral Agent of an Officers’ Certificate certifying that
(x) such asset is comprised of Secondary Collateral, (y) Credit
Facility Obligations remain outstanding under one or more Credit Facilities and
(z) to the extent such consent is required, the Credit Facility Agent
under any such Credit Facility has authorized the release of the same.

 

135

 

SECTION 12.06                                      Release of all Note Collateral.

 

The
Liens on, and pledges of, all Note Collateral will be terminated and released,
and upon the request of the Company pursuant to an Officers’ Certificate
certifying that all conditions precedent hereunder have been met, the Company
and the Guarantors will be entitled to releases of all assets included in the
Note Collateral from the Note Liens under all Collateral Documents, without the
consent of the Collateral Agent, the Trustee or any Holder, upon any of:

 

(a)           payment in full of
the principal of, premium, if any, and accrued and unpaid interest on the Notes
and all other Obligations hereunder, the Note Guarantees and the Collateral
Documents that are due and payable at or prior to the time such principal,
premium, if any, and accrued and unpaid interest are paid;

 

(b)           a satisfaction and
discharge of this Indenture in accordance with Section 8.02;

 

(c)           the occurrence of a
Legal Defeasance or Covenant Defeasance in accordance with Section 8.01;
or

 

(d)           the written consent
of Holders of at least 75% in aggregate principal amount of the outstanding
Notes voting as a single class (including consents obtained in connection with
a purchase of, or tender offer or exchange offer for, Notes).

 

SECTION 12.07                                      Matters as to Releases.

 

(a)           In the event
(x) that the Company or any Guarantor has sold, exchanged, or otherwise
disposed of or proposes to sell, exchange or otherwise dispose of any property
or assets comprising Note Collateral that may be sold, exchanged or otherwise
disposed of by the Company or such Guarantor pursuant to and in accordance with
Section 12.04(b), 12.04(d), 12.05, 12.06, or 12.11
and the provisions of any applicable Collateral Document and (y) the
Company or such Guarantor requests the Trustee or the Collateral Agent to
execute and deliver a written instrument of disclaimer, release or quit-claim
as to any interest in such property or assets under this Indenture and the
Collateral Documents or, to the extent applicable to such property or assets,
take all action that is necessary or reasonably requested by the Company (in
each case at the expense of the Company) to release and reconvey to the Company
or such Guarantor, without recourse, such property or asset or deliver such
property or asset in its possession to the Company or such Guarantor, upon
satisfaction of the conditions set forth herein or in the Collateral Documents
for such execution and delivery or other action, the Collateral Agent or the
Trustee, as applicable, shall execute, acknowledge and deliver to the Company
or such Guarantor (in proper form) such an instrument or take such other action
so requested.  As a condition precedent
to such execution and delivery or such other action, the Trustee and the
Collateral Agent shall be entitled to receive, and shall be fully protected in
relying upon, an Opinion of Counsel and an Officers’ Certificate, each stating
(i) that such execution is authorized or permitted by this Indenture and
the Collateral Documents, (ii) that all conditions precedent thereto
herein and in any Collateral Documents have been satisfied and (iii) under
which of the circumstances set forth in Sections 12.04(b), 

 

136

 

12.04(d), 12.05, 12.06, or 12.11
the Note Collateral is being released. 
All purchasers and grantees of any property or rights purporting to be
released herefrom shall be entitled to rely upon any such instrument executed
by the Collateral Agent or the Trustee, as applicable, hereunder as sufficient
for the purpose of this Indenture and as constituting a good and valid release
of the property therein described from the Lien of this Indenture or of the
Collateral Documents.

 

(b)           All instruments
effectuating or confirming any release of any Note Liens shall have the effect
solely of releasing such Note Liens as to the assets or property comprising
Note Collateral described therein on customary terms and without any recourse,
representation, warranty or liability whatsoever.

 

(c)           The Trustee and the
Collateral Agent are not required to serve, file, register or record any
instrument releasing Note Collateral.

 

(d)           The Company shall
bear and pay all costs and expenses associated with any release of Note Liens
pursuant to Sections 12.04, 12.05 or 12.06, including all
reasonable fees and disbursements of any attorneys or representatives acting
for the Trustee or the Collateral Agent.

 

SECTION 12.08                                      Purchaser Protected.

 

No
purchaser or grantee of any property or rights purporting to be released
herefrom shall be bound to ascertain the authority of the Trustee or the
Collateral Agent to execute the release or to inquire as to the existence of
any conditions herein prescribed for the exercise of such authority; nor shall
any purchaser or grantee of any property or rights permitted by this Indenture
to be sold or otherwise disposed of by the Company be under any obligation to
ascertain or inquire into the authority of the Company to make such sale or
other disposition.

 

SECTION 12.09                                      Authorization of Actions to Be Taken by
the Collateral Agent Under the Collateral Documents.

 

Wilmington
Trust Company is hereby appointed to act in its capacity as the Collateral
Agent.  Subject to the provisions of the
applicable Collateral Documents and the Intercreditor Agreement, (a) the
Collateral Agent shall execute and deliver the Collateral Documents and the
Intercreditor Agreement and act in accordance with the terms thereof,
(b) the Collateral Agent may, in its sole discretion and without the
consent of the Trustee or the Holders, take all actions it deems necessary or
appropriate in order to (1) enforce any of the terms of the Collateral
Documents and (2) collect and receive any and all amounts payable in
respect of the Obligations of the Company and the Guarantors hereunder and
under the Notes, the Note Guarantees, the Collateral Documents and the
Intercreditor Agreement and (c) the Collateral Agent shall have power to
institute and to maintain such suits and proceedings as it may deem expedient
to prevent any impairment of the Note Collateral by any act that may be
unlawful or in violation of the Collateral Documents or this Indenture, and
such suits and proceedings as the Collateral Agent may deem expedient to
preserve or protect its interests and the interests of the Trustee and the
Holders in the Note Collateral (including the power to institute and maintain
suits or proceedings to restrain the enforcement of or compliance with any
legislative or other 

 

137

 

governmental enactment,
rule or order that may be unconstitutional or otherwise invalid if the
enforcement of, or compliance with, such enactment, rule or order would
impair the Note Liens or be prejudicial to the interests of the Holders, the
Trustee or the Collateral Agent). 
Notwithstanding the foregoing, the Collateral Agent may, at the expense
of the Company, request the direction of the Holders with respect to any such
actions and upon receipt of the written consent of the Holders of at least a
majority in aggregate principal amount of the outstanding Notes voting as a
single class (including consents obtained in connection with a purchase of, or
tender offer or exchange offer for, Notes), shall take such actions; provided
that all actions so taken shall, at all times, be in conformity with the
requirements of the Intercreditor Agreement.

 

SECTION 12.10                                      Authorization of Receipt of Funds by the
Collateral Agent Under the Collateral Documents.

 

The
Collateral Agent is authorized to receive any funds for the benefit of itself,
the Trustee and the Holders distributed under the Collateral Documents and the
Intercreditor Agreement to the extent permitted under the Intercreditor
Agreement, for turnover to the Trustee to make further distributions of such
funds to itself, the Collateral Agent and the Holders in accordance with the
provisions of Section 6.10 and the other provisions of this
Indenture.

 

SECTION 12.11                                      Collateral Monies.

 

(a)           All Collateral
Monies, including the Net Proceeds received in connection with a Primary
Collateral Asset Sale, the Net Loss Proceeds required to be deposited with the
Collateral Agent in connection with an Event of Loss and the net proceeds of
issuance of any Additional Notes, shall be held by the Collateral Agent as part
of the Primary Collateral securing the Notes. 
So long as no Default or Event of Default under this Indenture shall
have occurred and be continuing, Collateral Monies may:

 

(i)            with
respect to the Net Proceeds of Primary Collateral Asset Sales, be released as
contemplated by Section 4.16, subject to the conditions set forth
in this Indenture;

 

(ii)           with
respect to Net Loss Proceeds, be released to repair or replace the relevant
Primary Collateral as contemplated by Section 4.17, subject to the
conditions set forth in this Indenture;

 

(iii)          at
the Company’s direction be applied by the Collateral Agent from time to time to
the payment of the principal of, premium, if any, and interest on any Notes at
maturity or upon redemption or retirement, or to the purchase of Notes upon
tender or in the open market or otherwise, in each case, in compliance with
this Indenture;

 

(iv)          continue
to be held by the Collateral Agent as part of the Primary Collateral securing
the Notes;

 

(v)           with
respect to the net proceeds of the issuance of Additional Notes, be released to
acquire Additional Assets constituting Specified Assets that simultaneously
with the acquisition thereof become 

 

138

 

Specified Collateral and such Additional Assets are not acquired until
and unless the provisions of Section 4.28 have been complied with
respect to such Additional Assets, subject to the conditions set forth in this
Indenture; or

 

(vi)          solely
with respect to Collateral Monies received by the Collateral Agent pursuant to clause
(6) of the definition of “Collateral Monies”, be applied as provided
in the relevant provisions of this Indenture or any Collateral Document
applicable thereto.

 

(b)           Upon the occurrence
and during the continuance of any Event of Default, the Collateral Agent shall
be entitled to apply any Collateral Monies to the payment of the principal of,
premium if any, and interest on any Notes or otherwise to cure any Event of
Default under this Indenture.  Collateral
Monies deposited with the Collateral Agent shall be invested in cash or Cash
Equivalents pursuant to the Company’s direction and, so long as no Default or
Event of Default shall have occurred and be continuing, the Company shall be
entitled to any interest or dividends accrued, earned or paid on such Cash
Equivalents.

 

SECTION 12.12                                      Limitation on Certain Securities
Collateral.

 

(a)           The Capital Stock
and other securities of any Guarantor shall constitute Note Collateral only to
the extent that such Capital Stock and other securities can secure the Notes or
the Note Guarantees without Rule 3-10 or Rule 3-16 of Regulation S-X
under the Securities Act (or any other law, rule or regulation) requiring
separate financial statements of such Person to be filed with the SEC (or any
other governmental agency).  In the event
that Rule 3-10 or Rule 3-16 of Regulation S-X under the Securities
Act requires or is amended, modified or interpreted by the SEC to require (or
is replaced with another rule or regulation, or any other law,
rule or regulation is adopted, which would require) the filing with the
SEC (or any other governmental agency) of separate financial statements of any
Guarantor due to the fact that such Person’s Capital Stock and other securities
secure the Notes or the Note Guarantees, then such portion (and only such
portion) of the Capital Stock and other securities of such Guarantor as shall
constitute the minimum amount necessary to avoid having such Person be subject
to such requirement shall automatically be deemed not to be part of the Note
Collateral.  In such event, this
Indenture or any Collateral Document may be amended or modified, without the
consent of any holder of Notes or other Note Obligations, to the extent
necessary to release the first-priority security interests on such portion of
the shares of Capital Stock and other securities that are so deemed to no
longer constitute part of the Note Collateral.

 

(b)           In the event that
Rule 3-10 or Rule 3-16 of Regulation S-X under the Securities Act is
amended, modified or interpreted by the SEC to permit (or is replaced with
another rule or regulation, or any other law, rule or regulations
adopted, which would permit) such Guarantor’s Capital Stock and other
securities to secure the Notes or the Note Guarantees in excess of the portion
then pledged without the filing with the SEC (or any other governmental agency)
of separate financial statements of such Guarantor, then such additional
portion of the Capital Stock and other securities of such Person as 

 

139

 

shall constitute
the maximum additional amount possible without having such Person be subject to
such requirement shall automatically be deemed to be a part of the Note
Collateral.  In such event, this
Indenture or any Collateral Document may be amended or modified, without the
consent of any holder of Notes or other Note Obligations, to the extent
necessary to subject such additional Capital Stock and other securities to the
Liens under the Collateral Documents.

 

(c)           Solely for purposes
of Section 4.16 and the definition of “Asset Sale”, any Capital
Stock and other securities that would be Note Collateral but for the provisions
described in Section 12.12(a), shall nonetheless be treated as (and
deemed to be) “Note Collateral.”

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

140

 

SIGNATURES

 

IN
WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly
executed, all as of the date first written above.

 

	
   

  	
  AVENTINE
  RENEWABLE ENERGY HOLDINGS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ William J.
  Brennan

  
	
   

  	
   

  	
  Name:

  	
  William J.
  Brennan

  
	
   

  	
   

  	
  Title:

  	
  Chief Accounting
  and Compliance Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  WILMINGTON
  TRUST FSB, as
  Trustee and Collateral Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jane Schweiger

  
	
   

  	
   

  	
  Name:

  	
  Jane Schweiger

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  

 

[Signature
Page to Indenture]

 

 

	
   

  	
  GUARANTORS:

  
	
   

  	
   

  
	
   

  	
  AVENTINE
  RENEWABLE ENERGY, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ William J.
  Brennan

  
	
   

  	
   

  	
  Name:

  	
  William J.
  Brennan

  
	
   

  	
   

  	
  Title:

  	
  Chief Accounting
  and Compliance Officer

  
	
   

  	
   

  
	
   

  	
  AVENTINE
  POWER, LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ William J.
  Brennan

  
	
   

  	
   

  	
  Name:

  	
  William J.
  Brennan

  
	
   

  	
   

  	
  Title:

  	
  Chief Accounting
  and Compliance Officer

  
	
   

  	
   

  
	
   

  	
  AVENTINE
  RENEWABLE ENERGY-AURORA WEST, LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ William J.
  Brennan

  
	
   

  	
   

  	
  Name:

  	
  William J.
  Brennan

  
	
   

  	
   

  	
  Title:

  	
  Chief Accounting
  and Compliance Officer

  
	
   

  	
   

  
	
   

  	
  AVENTINE
  RENEWABLE ENERGY-MT VERNON, LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ William J.
  Brennan

  
	
   

  	
   

  	
  Name:

  	
  William J.
  Brennan

  
	
   

  	
   

  	
  Title:

  	
  Chief Accounting
  and Compliance Officer

  
	
   

  	
   

  
	
   

  	
  NEBRASKA ENERGY, L.L.C.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ William J.
  Brennan

  
	
   

  	
   

  	
  Name:

  	
  William J.
  Brennan

  
	
   

  	
   

  	
  Title:

  	
  Vice President –
  Finance

  

 

[Signature
Page to Indenture]

 

 

EXHIBIT
A

 

[FORM OF
INITIAL NOTE]

 

THIS
NOTE IS BEING ISSUED WITH ORIGINAL ISSUE DISCOUNT FOR UNITED STATES FEDERAL
INCOME TAX PURPOSES. FOR INFORMATION ON THE ISSUE PRICE, AMOUNT OF ORIGINAL
ISSUE DISCOUNT, ISSUE DATE AND COMPARABLE YIELD FOR THE NOTES, PLEASE CONTACT
AVENTINE RENEWABLE ENERGY HOLDINGS, INC., 120 NORTH PARKWAY DRIVE, PEKIN,
ILLINOIS 61554, ATTENTION: CORPORATE CONTROLLER.

 

[Insert
the following two paragraphs if this Note is a Global Note:

 

THIS
NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED
TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY OR A NOMINEE OF A DEPOSITORY
OR A SUCCESSOR DEPOSITORY.  THIS NOTE IS
NOT EXCHANGEABLE FOR NOTES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE
DEPOSITORY OR ITS NOMINEE EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
INDENTURE, AND NO TRANSFER OF THIS NOTE (OTHER THAN A TRANSFER OF THIS NOTE AS
A WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE
DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY) MAY BE
REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.

 

UNLESS
THIS CERTIFICATE 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 CERTIFICATE
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.]

 

[Insert
the following paragraph (i.e., the “Private Placement Legend”) if this Note is
a Restricted Security:

 

THIS
NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), OR ANY STATE SECURITIES LAWS. NEITHER THIS NOTE NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED,
PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
REGISTRATION. THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF (1) REPRESENTS
THAT (A) IT IS A “QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED IN RULE 144A
UNDER THE 

 

A-1

 

SECURITIES
ACT), (B) IT IS A NON-U.S. PURCHASER AND IS ACQUIRING THIS NOTE IN AN
OFFSHORE TRANSACTION WITHIN THE MEANING OF REGULATION S UNDER THE
SECURITIES ACT OR (C) IT IS AN “ACCREDITED INVESTOR” WITHIN THE MEANING OF
SUBPARAGRAPH (a) OF RULE 501 UNDER THE SECURITIES ACT AND (2) AGREES
TO OFFER, SELL OR OTHERWISE TRANSFER THIS NOTE, PRIOR TO THE DATE WHICH IS ONE
YEAR (OR SUCH OTHER PERIOD THAT MAY BE HEREAFTER PROVIDED UNDER RULE 144
UNDER THE SECURITIES ACT PERMITTING RESALES OF RESTRICTED SECURITIES BY
NON-AFFILIATES WITHOUT RESTRICTION) AFTER THE LATER OF THE ORIGINAL ISSUE DATE
HEREOF AND THE LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY
WAS THE OWNER OF THIS NOTE (OR ANY PREDECESSOR OF SUCH NOTE), ONLY (A) TO
THE COMPANY OR ANY OF ITS SUBSIDIARIES, (B) PURSUANT TO A REGISTRATION
STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR
SO LONG AS THE NOTES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON
IT REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE
144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS
AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE
MEANING OF REGULATION S UNDER THE SECURITIES ACT, (E) TO AN “ACCREDITED
INVESTOR” WITHIN THE MEANING OF SUBPARAGRAPH (a) OF RULE 501 UNDER THE
SECURITIES ACT THAT IS ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT, OR FOR THE
ACCOUNT OF SUCH AN ACCREDITED INVESTOR, FOR INVESTMENT PURPOSES AND NOT WITH A
VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION
OF THE SECURITIES ACT OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE COMPANY’S
AND THE TRUSTEE’S, OR TRANSFER AGENT’S, AS APPLICABLE, RIGHT PRIOR TO ANY SUCH
OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES (D), (E) OR (F) TO
REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER
INFORMATION SATISFACTORY TO EACH OF THEM, AND IN EACH OF THE FOREGOING CASES, A
CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE OTHER SIDE OF THIS
SECURITY IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE TRUSTEE OR
TRANSFER AGENT.]

 

A-2

 

AVENTINE RENEWABLE
ENERGY HOLDINGS, INC.

 

13% SENIOR SECURED
NOTES DUE 2015

 

CUSIP
No.[       ]

No. [  ]                                                                                                                                                                         $[      ]

 

Aventine
Renewable Energy Holdings, Inc., a Delaware corporation (the “Company,”
which term includes any successor entity), for value received promises to pay
to                                       
or registered assigns the principal sum of                               
Dollars [or such greater or lesser amount as may be indicated on Schedule A
hereto](1) on March 15,
2015, and to pay interest thereon as hereinafter set forth.

 

Interest
Rate:  As specified in paragraph 1 of the
reverse side hereof.

 

Interest
Payment Dates:  March 15, June 15, September 15 and December 15 of each year,
beginning on June 15, 2010.

 

Record
Dates:  March 1, June 1, September 1 and December 1.

 

Reference
is made to the further provisions of this Note contained on the reverse side of
this Note, which will for all purposes have the same effect as if set forth at
this place.

 

[Signature Follows Immediately on Next Page]

 

(1) Include only on Global Note.

 

A-3

 

IN
WITNESS WHEREOF, the Company has caused this Note to be signed manually or by
facsimile by its duly authorized officer.

 

	
   

  	
  AVENTINE RENEWABLE ENERGY HOLDINGS, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  	
   

  
					

 

A-4

 

TRUSTEE CERTIFICATE
OF AUTHENTICATION

 

This
is one of the 13% Senior Secured
Notes due 2015 referred to in the within-mentioned Indenture.

 

	
   

  	
   

  	
  Wilmington Trust FSB, as Trustee

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Authorized Signatory

  
					

 

A-5

 

(REVERSE OF NOTE)

 

13% SENIOR SECURED
NOTE DUE 2015

 

Capitalized
terms used herein but not defined shall have the meanings assigned to them in
the Indenture referred to below unless otherwise indicated.

 

1.             Interest.  Aventine Renewable Energy Holdings, Inc.,
a Delaware corporation (the “Company,” which term includes any successor
entity), promises to pay interest on the principal amount of this Note at the
rate per annum of 13% solely in cash; provided, however, that, if
with respect to any Interest Payment Date that occurs prior to Maturity of any
Notes, the Company has duly elected pursuant to Section 4.01(c) of
the Indenture not to pay the entire installment of interest due on such
Interest Payment Date in cash:

 

(i)            the interest on such Notes that is
due on such Interest Payment Date shall be deemed to have accrued since the
next preceding Interest Payment Date (or, if such Interest Payment Date is the
first Interest Payment Date in respect of such Notes, the date of original
issue thereof) at a rate of 15% per annum, whether or not the Company duly pays
on such Interest Payment Date such installment of interest due on such Interest
Payment Date; and

 

(ii)           if (but only if) the Company pays on
such Interest Payment Date the entire installment of interest on such Notes due
on such Interest Payment Date, the portion of such installment equal to the PIK
Interest Amount with respect to such Interest Payment Date (i.e., the portion equal to 7/15 of the aggregate amount
thereof) shall be payable by issuance of PIK Notes in accordance with the
fourth paragraph of Section 2.02 of the Indenture and the remainder of such
installment shall be payable in cash.

 

Interest
on this Note will accrue from the most recent date on which interest has been
paid on this Note or, if no interest has been paid, from and including the
Issue Date (or, if this Note was originally issued after the Issue Date as a
PIK Note or as an Additional Note, from the date of original issue of this
Note).  The Company will pay interest
quarterly in arrears on each Interest Payment Date, commencing June 15, 2010.  Interest will be computed on the basis of a
360-day year comprised of twelve 30-day months. 
The Company will pay interest on overdue principal at 15% per annum and
will pay interest on overdue installments of interest at the same rate to the
extent lawful.  Additional Interest may
accrue on this Note in certain circumstances pursuant to the Registration
Rights Agreement and all references to “interest” in this Note shall include
any Additional Interest due on this Note pursuant to the terms of the
Registration Rights Agreement.

 

2.             Method
of Payment.  The Company shall pay
interest on the Notes (except defaulted interest) to the Persons who are the
registered Holders at the close of business on the Record Date immediately
preceding the Interest Payment Date even if the Notes are cancelled on registration
of transfer or registration of exchange after such Record Date, and on or
before such Interest Payment Date. 
Holders must surrender the Notes to a Paying Agent to collect principal
payments.  The Company shall pay
principal and (except to the extent payable as PIK Interest) interest in U.S.
Legal Tender.  If a Holder has given wire
transfer instructions to the Company, the Paying Agent will remit on behalf of
the Company all principal, interest and premium, if any, 

 

A-6

 

payable in cash on that Holder’s Notes in accordance with those
instructions.  All other payments on the
Notes payable in cash will be made by check mailed to the Holders at their
addresses set forth in the Register of Holders. 
The Company shall pay all interest payable as PIK Interest in the manner
specified in the Indenture.

 

3.             Paying Agent and
Registrar.  Initially, Wilmington Trust FSB  (the “Trustee”) will act as
Paying Agent and Registrar.  The Company
may change any Paying Agent, Registrar or co-Registrar without notice to the
Holders.

 

4.             Indenture.  The Notes and the Note Guarantees were issued
under an Indenture, dated as of  March 15, 2010 (the “Indenture”),
among the Company, the Guarantors named therein, the Trustee and the Collateral
Agent.  The terms of the Notes include
those stated in the Indenture and those made part of the Indenture by reference
to the Trust Indenture Act of 1939 (15 U.S. Code §§ 77aaa-77bbbb) (the “TIA”),
as in effect on the date of the Indenture until such time as the Indenture is
qualified under the TIA, and thereafter as in effect on the date on which the
Indenture is qualified under the TIA. 
Notwithstanding anything to the contrary herein, the Notes are subject
to all such terms, and Holders of the Notes are referred to the Indenture and
the TIA for a statement of such terms. 
Any conflict between the Notes and the Indenture will be governed by the
Indenture.  The Notes are senior secured
obligations of the Company.  Each Holder,
by accepting a Note, agrees to be bound by all of the terms and provisions of
the Indenture, as the same may be amended from time to time.

 

5.             Redemption.

 

(a)           Optional
Redemption.  (i)  The Company
may, at its option, on any one or more occasions redeem all or a part of the
Notes upon not less than 30 days’ nor more than 60 days’ prior notice to the
Trustee, at the Redemption Prices (expressed as percentages of principal
amount) set forth below plus accrued and unpaid interest to (but not including)
the Redemption Date (subject to any installment of interest thereon, the
maturity of which is on or prior to the Redemption Date, being payable to
Holders of record at the close of business on the relevant Record Date), if
redeemed during the twelve-month period commencing on March 15 of the years set forth below:

 

	
  Year

  	
   

  	
  Percentage

  	
   

  
	
  2010

  	
   

  	
  105

  	
  %

  
	
  2011

  	
   

  	
  104

  	
  %

  
	
  2012

  	
   

  	
  103

  	
  %

  
	
  2013

  	
   

  	
  102

  	
  %

  
	
  2014

  	
   

  	
  101

  	
  %

  

 

(ii)           Notwithstanding clause (a) above,
if the Company delivers a Board Resolution to the Trustee setting forth the
irrevocable determination of the Company not to complete construction of either
the Aurora Facility or Mt. Vernon Facility, then during the 90-day period
following the Issue Date, the Company may, at its option, redeem up to
$25,000,000 in aggregate principal amount of the Notes originally issued under
the Indenture (including the Exchange Notes) at a Redemption Price equal to
101% of the principal amount of the Notes redeemed plus accrued and unpaid
interest on the Notes 

 

A-7

 

redeemed to (but not
including) the Redemption Date (subject to any installment of interest thereon,
the maturity of which is on or prior to the Redemption Date, being payable to
Holders of record at the close of business on the relevant Record Date).

 

(b)           Mandatory
Redemption.  The Company shall not be
required to make any mandatory redemption or sinking fund payments with respect
to the Notes.  The Company may at any
time and from time to time purchase Notes in the open market or otherwise.

 

6.             Notice of
Redemption.  At least 30 days but not
more than 60 days before the Redemption Date, the Company shall mail or cause
to be mailed a notice of redemption by first class mail, postage prepaid, to
each Holder whose Notes are to be redeemed at such Holder’s registered address
with a copy to the Trustee and any Paying Agent.  If fewer than all of the Notes are to be
redeemed pursuant to the provisions of the Indenture, the Trustee shall select
the Notes to be redeemed (a) in compliance with the requirements of the
principal national securities exchange, if any, on which the Notes are listed
or (b) if the Notes are not then listed on a national securities exchange,
on a pro  rata basis, by lot or by such method as the Trustee may
reasonably determine is fair and appropriate; provided, that if any such
redemption is made pursuant to Section 5(a)(ii), the Trustee will
select the Notes only on a pro  rata basis or on as nearly a pro
rata basis as is practicable (subject to DTC procedures), unless such
method is otherwise prohibited.  Notes
and portions of Notes selected shall be in amounts of $2,000 and integral
multiples of $1,000 in excess thereof, except that (i) if all of the Notes
of a Holder are to be redeemed, the entire outstanding amount of Notes held by
such Holder, even if not a multiple of $1,000, shall be redeemed, subject in
the case of Global Notes, to the procedures of DTC; and (ii) in any event
the unredeemed portion of Notes redeemed in part shall be at least $2,000.

 

Except
as set forth in the Indenture, if monies for the redemption of the Notes called
for redemption shall have been deposited with the Paying Agent for redemption
on such Redemption Date sufficient to pay such Redemption Price plus accrued
and unpaid interest, if any, interest on the Notes to be redeemed shall cease
to accrue on the Redemption Date, whether or not such Notes are presented for
payment, and the only remaining right of the Holders of such Notes will be to
receive payment of the Redemption Price upon surrender to the Paying Agent of
the Notes redeemed.

 

7.             Offers to
Purchase.  Sections 4.15 and 4.19 of
the Indenture provide that upon the occurrence of a Change of Control or after
certain Asset Sales, an Event of Loss and an Equity Offering, respectively, and
subject to further limitations contained therein, the Company will make an
offer to purchase certain amounts of the Notes in accordance with the
procedures set forth in the Indenture.

 

8.             Registration
Rights.  Pursuant to the Registration
Rights Agreement, dated as of March 15, 2010, among the Company, the
Guarantors and the Backstop Purchasers, the Company will, subject to the terms
and conditions set forth therein, be obligated to consummate an Exchange
Offer.  Upon the consummation of such
Exchange Offer, the Holders of the Initial Notes shall have the right, subject
to compliance with securities laws, to exchange such Notes for 13% Senior Secured Notes due 2015,
which have been registered under the Securities Act (the “Exchange Notes”),
in like principal amount and having terms identical in all material respects to
the Initial Notes.  The Holders of the
Initial Notes shall be entitled to receive certain Additional 

 

A-8

 

Interest payments in the event such Exchange
Offer is not consummated and upon certain other conditions, all pursuant to and
in accordance with the terms of the Registration Rights Agreement, dated as of March 15,
2010, among the Company, the Guarantor and the Backstop Purchasers.

 

9.             Denominations;
Transfer; Exchange.  The Notes shall
be issuable in fully registered form only, without coupons, in denominations of
$2,000 and any integral multiple of $1,000 in excess of $2,000, subject to the
payment of interest on any Notes on any Interest Payment Date by issuance of
PIK Notes, in which case the aggregate principal amount of Global Notes
previously authenticated under the Indenture may be increased by, or additional
Notes constituting PIK Notes may be issued in, an aggregate principal amount
equal to the PIK Interest Amount with respect to such Interest Payment Date for
such Notes, rounded up the nearest $1.00. 
A Holder shall register the transfer of or exchange of Notes in
accordance with the Indenture.  The
Registrar or co-Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and to pay any taxes, fees or
similar governmental charges payable in connection therewith as permitted by
the Indenture.  The Registrar or co-Registrar
shall not be required to register the transfer of or exchange of any Note or
portion thereof (a) during a period beginning at the opening of business
fifteen (15) days before the mailing of a notice of redemption of Notes and
ending at the close of business on the day of such mailing and (b) selected
for redemption in whole or in part pursuant to Article Three of the
Indenture, except the unredeemed portion of any Note being redeemed in part.

 

10.           Persons Deemed
Owners.  The registered Holder of a
Note shall be treated as the owner of it for all purposes.

 

11.           Unclaimed Money.  If money for the payment of principal or
interest remains unclaimed for two years, the Trustee and the Paying Agent may
pay the money without interest thereon back to the Company.  After that, all liability of the Trustee and
such Paying Agent with respect to such money shall cease.

 

12.           Discharge Prior
to Redemption or Maturity.  If the
Company at any time deposits with the Trustee U.S. Legal Tender or U.S.
Government Obligations, or a combination thereof, sufficient to pay the
principal of, premium, if any, and interest on the outstanding Notes on the
stated date for payment or redemption, as the case may be, and complies with
the other provisions of the Indenture relating thereto, the Company and its
Restricted Subsidiaries will be released and discharged from certain provisions
of the Indenture and the Notes (including certain covenants, but excluding the
Company’s obligation to pay the principal of and interest and Additional
Interest, if any, on the Notes).

 

13.           Original Issue
Discount.  The Notes are issued with “original
issue discount” for U.S. federal income tax purposes.  For information on the issue price, amount of
original issue discount, issue date and comparable yield for the Notes, please
contact Aventine Renewable Energy Holdings, Inc., 120 North Parkway Drive,
Pekin, Illinois 61554, Attention: 
Corporate Controller.

 

14.           Amendment;
Supplement; Waiver.  Subject to
certain exceptions, the Indenture, the Notes, the Note Guarantees, the
Intercreditor Agreement and the Collateral Documents may 

 

A-9

 

be amended or supplemented with the written
consent of the Holders of at least a majority in aggregate principal amount of
the Notes then outstanding voting as a single class, and any existing Default
or Event of Default or noncompliance with any provision of such agreements may
be waived with the written consent of the Holders of a majority in aggregate
principal amount of the Notes then outstanding voting as a single class.  Without consent of any Holder, the parties
thereto may amend or supplement the Indenture, the Notes, the Note Guarantees,
the Intercreditor Agreement or the Collateral Documents to, among other things,
cure any ambiguity, defect or inconsistency, provide for uncertificated Notes
in addition to or in place of certificated Notes, provide for the assumption of
the obligations of the Company or any Guarantor in accordance with Section 5.01
or Section 10.04 of the Indenture, make any other change that would
provide any additional rights or benefits to the Holders or that does not
adversely affect in any material respect the legal rights of any Holder of a
Note, to comply with the requirements of the SEC in order to effect or maintain
the qualification of the Indenture under the TIA, to provide for any addition
or release of Note Collateral permitted under the Indenture, the Intercreditor
Agreement or the Collateral Documents and to release a Guarantor from its Note
Guarantee and the Collateral Documents as permitted by the Indenture.

 

15.           Restrictive
Covenants.  The Indenture imposes
certain limitations on the ability of the Company and its Restricted
Subsidiaries to, among other things, incur additional Indebtedness or Liens,
make payments in respect of their Capital Stock or certain Indebtedness, enter
into transactions with Affiliates, create dividend or other payment
restrictions affecting Restricted Subsidiaries, merge or consolidate with any
other Person or sell, assign, transfer, lease, convey or otherwise dispose of
all or substantially all of their assets. 
Such limitations are subject to a number of important qualifications and
exceptions.

 

16.           Successors.  When a successor assumes, in accordance with
the Indenture, all the obligations of its predecessor under the Notes, the Note
Guarantees and the Indenture, the predecessor will be released from those
obligations.

 

17.           Defaults and
Remedies.  If an Event of Default
occurs and is continuing (a) with respect to certain events of bankruptcy,
the Notes will automatically become due and payable in the manner, at the time
and with the effect provided in the Indenture. 
If any other Event of Default occurs and is continuing, the Trustee or
the Holders of at least 25% in aggregate principal amount of Notes then
outstanding voting as a single class may declare all the Notes to be due and
payable in the manner, at the time and with the effect provided in the
Indenture.  Holders of Notes may not
enforce the Indenture except as provided in the Indenture.  The Trustee is not obligated to enforce the
Indenture or the Notes unless it has received reasonable indemnity satisfactory
to it.  The Indenture permits, subject to
certain limitations therein provided, Holders of a majority in aggregate
principal amount of the Notes then outstanding voting as a single class to
direct the Trustee in its exercise of any trust or power.  The Trustee may withhold from Holders of
Notes notice of any continuing Default or Event of Default (except a Default in
payment of principal or interest) if it determines that withholding notice is
in their interest.

 

18.           Trustee Dealings
with Company.  Subject to the terms
of the TIA and the Indenture, the Trustee, in its individual or any other
capacity, may become the owner or pledgee of Notes and may otherwise deal with
the Company, its Subsidiaries or their respective Affiliates as if it were not
the Trustee.

 

A-10

 

19.           No Recourse
Against Others.  No Affiliate,
director, manager, officer, employee, incorporator, member or holder of any
Equity Interests in the Company, a Guarantor or the Trustee or any direct or
indirect parent of the Company, a Guarantor or the Trustee, as such, will have
any liability for any obligations of the Company or any Guarantor under the
Notes, the Indenture, the Note Guarantees or the Collateral Documents, or for
any claim based on, in respect of, or by reason of, such obligations or their
creation.  Each Holder of the Notes by
accepting a Note waives and releases all such liability.  The waiver and release are part of the
consideration for issuance of the Notes and the Note Guarantees.  The parties hereto acknowledge that such
waiver may not be effective to waive liabilities under the federal securities
laws.

 

20.           Guarantees.           Payment of principal and interest
(including interest on overdue principal and overdue interest, if lawful) on
the Notes is unconditionally guaranteed, jointly and severally, by each of the
Guarantors as provided in the Indenture.

 

21.           Authentication.  This Note shall not be valid until the
Trustee or Authenticating Agent manually signs the certificate of
authentication on this Note.

 

22.           Governing Law.
THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK, AS APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN THE STATE
OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS (OTHER THAN N.Y.
GEN. OBL. LAW § 5-1401). EACH HOLDER, BY ITS ACCEPTANCE OF ITS NOTE, AGREES TO
SUBMIT TO THE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK IN ANY ACTION
OR PROCEEDING ARISING OUT OF OR RELATING TO THIS NOTE.

 

23.           Abbreviations and
Defined Terms.  Customary
abbreviations may be used in the name of a Holder of a Note or an assignee,
such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties),
JT TEN (= joint tenants with right of survivorship and not as tenants in
common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).

 

24.           Security.  Subject to the Intercreditor Agreement, the
Company’s and Guarantors’ obligations under the Notes are secured by Liens on
the Note Collateral pursuant to the terms of the Collateral Documents.  Subject to the terms of the Intercreditor
Agreement, the actions of the Trustee and the Holders of the Notes in the
enforcement of any remedies with respect to the Note Collateral and the
application of the proceeds therefrom are limited pursuant to the terms of the
Collateral Documents.

 

25.           CUSIP Numbers.  Pursuant to a recommendation promulgated by
the Committee on Uniform Security Identification Procedures, the Company has
caused CUSIP numbers to be printed on the Notes as a convenience to the Holders
of the Notes.  No representation is made
as to the accuracy of such numbers as printed on the Notes and reliance may be
placed only on the other identification numbers printed thereon.

 

26.           Acceptance.  Each Holder, by its acceptance of its Note,
agrees to be bound by the terms of the Intercreditor Agreement and the
Registration Rights Agreement, and each of the 

 

A-11

 

Holders hereby authorizes the Trustee and the
Collateral Agent to bind the Holders to the extent provided in the Indenture.

 

27.           WAIVER OF JURY
TRIAL.  EACH HOLDER, BY ITS
ACCEPTANCE OF ITS NOTE, HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY LAW, ANY RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING
ARISING OUT OF OR IN CONNECTION WITH THIS NOTE, THE INDENTURE, THE NOTE
GUARANTEES, THE COLLATERAL DOCUMENTS, THE INTERCREDITOR AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED THEREBY.

 

The
Company will furnish to any Holder of a Note upon written request and without
charge a copy of the Indenture.  Requests
may be made to:  Aventine Renewable
Energy Holdings, Inc., 120 North Parkway Drive, Pekin, Illinois 61554.

 

A-12

 

ASSIGNMENT FORM

 

If
you the Holder want to assign this Note, fill in the form below and have your
signature guaranteed:

 

I
or we assign and transfer this Note to:

 

	
   

  
	
   

  
	
  (Print or type name,
  address and zip code and

  
	
  social security or tax ID number of assignee)

  

 

and irrevocably appoint                                                                                                                                                          
agent to transfer this Note on the books of the Company.  The agent may substitute another to act for
him.

 

	
  Dated:

  	
   

  	
   

  	
  Signed:

  	
   

  
	
   

  	
  (Sign exactly as your name appears on the other side of this Note)

  

 

	
  Signature Guarantee:

  	
   

  	
   

  

 

In
connection with any transfer of this Note occurring prior to the date which is
the earlier of (i) the date of the declaration by the SEC of the
effectiveness of a registration statement under the Securities Act of 1933, as
amended (the “Securities Act”), covering resales of this Note (which
effectiveness shall not have been suspended or terminated at the date of the
transfer) and (ii) March 15, 2011, the undersigned confirms that it
has not utilized any general solicitation or general advertising in connection
with the transfer and that this Note is being transferred:

 

[Check
One]

 

	
  (1)

  	
  o

  	
  to the Company or a subsidiary thereof; or

  
	
   

  	
   

  	
   

  
	
  (2)

  	
  o

  	
  pursuant to and in compliance with Rule 144A under the
  Securities Act; or

  
	
   

  	
   

  	
   

  
	
  (3)

  	
  o

  	
  to an “accredited investor” (as defined in Rule 501(a) under
  the Securities Act) that has furnished to the Trustee a signed letter
  containing certain representations and agreements (the form of which letter
  can be obtained from the Trustee); or

  
	
   

  	
   

  	
   

  
	
  (4)

  	
  o

  	
  outside the Unites States to a person other than a “U.S. person” in
  compliance with Rule 904 of Regulation S under the Securities Act;
  or

  
	
   

  	
   

  	
   

  
	
  (5)

  	
  o

  	
  pursuant to the exemption from registration provided by Rule 144
  under the Securities Act; or

  
	
   

  	
   

  	
   

  
	
  (6)

  	
  o

  	
  pursuant to an effective registration statement under the Securities
  Act; or

  

 

A-13

 

	
  (7)

  	
  o

  	
  pursuant to another exemption from the registration requirements of
  the Securities Act (and based on an opinion of counsel acceptable to the
  Company).

  

 

Unless
one of the boxes is checked, the Trustee will refuse to register any of the
Notes evidenced by this certificate in the name of any person other than the
registered Holder thereof; provided that if box (3), (4) or (5) is
checked, the Company or the Trustee may require, prior to registering any such
transfer of the Notes, in its sole discretion, such legal opinions,
certifications, including an investment letter in the case of box (3) or
(4), and other information as the Trustee or the Company has reasonably
requested to confirm that such transfer is being made pursuant to an exemption
from, or in a transaction not subject to, the registration requirements of the
Securities Act.

 

If
none of the foregoing boxes is checked, the Trustee or Registrar shall not be
obligated to register this Note in the name of any person other than the Holder
hereof unless and until the conditions to any such transfer of registration set
forth herein and in Section 2.15 of the Indenture shall have been
satisfied.

 

 

	
  Dated:

  	
   

  	
   

  	
  Signed:

  	
   

  
	
   

  	
  (Sign exactly as your name appears on the other side of this Note)

  

 

	
  Signature Guarantee:

  	
   

  	
   

  

 

TO BE COMPLETED BY
PURCHASER IF (2) ABOVE IS CHECKED

 

The
undersigned represents and warrants that it is purchasing this Note for its own
account or an account with respect to which it exercises sole investment
discretion and that it and any such account is a “qualified institutional buyer”
within the meaning of Rule 144A under the Securities Act and is aware that
the sale to it is being made in reliance on Rule 144A and acknowledges
that it has received such information regarding the Company as the undersigned
has requested pursuant to Rule 144A or has determined not to request such
information and that it is aware that the transferor is relying upon the
undersigned’s foregoing representations in order to claim the exemption from
registration provided by Rule 144A.

 

	
  Dated:

  	
   

  	
   

  	
   

  
	
   

  	
  NOTICE: To be executed by an executive officer

  

 

A-14

 

[OPTION OF HOLDER TO ELECT
PURCHASE]

 

If
you want to elect to have this Note purchased by the Company pursuant to Section 4.15
or Section 4.19 of the Indenture, check the appropriate box:

 

Section 4.15  o

 

Section 4.19  o

 

If
you want to elect to have only part of this Note purchased by the Company
pursuant to Section 4.15 or Section 4.19 of the Indenture, state the
amount you elect to have purchased:

 

	
  $

  	
   

  	
   

  	
   

  	
   

  

 

	
  Dated:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  NOTICE:

  	
  The signature on this assignment must correspond with the name as it
  appears upon the face of the within Note in every particular without
  alteration or enlargement or any change whatsoever and be guaranteed by the
  endorser’s bank or broker.

  
	
   

  	
   

  
	
   

  	
  Signature Guarantee:

  	
   

  
						

 

A-15

 

[TO BE ATTACHED TO GLOBAL
NOTE]

 

SCHEDULE A

 

SCHEDULE OF INCREASES
OR DECREASES IN GLOBAL NOTE

 

The
following increases or decreases in this Global Note have been made:

 

	
  Date

  	
   

  	
  Amount of 

  decrease in 

  Principal 

  Amount of this 

  Global Note

  	
   

  	
  Amount of 

  increase in 

  Principal 

  Amount of this 

  Global Note

  	
   

  	
  Principal

  Amount of this 

  Global Note 

  following such 

  decrease or 

  increase

  	
   

  	
  Signature of

  authorized

  officer of

  Trustee, as

  Custodian of the

  Depository

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

A-16

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