Document:

Exhibit 10.28

 

FOURTH
AMENDMENT TO THE

MIRANT SERVICES
SUPPLEMENTAL BENEFIT PLAN

 

THIS FOURTH
AMENDMENT to the Mirant Services, LLC Supplemental
Benefit Plan (the “Plan”) is made this 8th day of December, 2005.

 

I.

 

Section 5.2(c) of the Plan
shall be amended by deleting such subsection in its entirety and replacing
it with the following new Section 5.2(c):

 

(c)                                  The
Non-Pension Benefit of the Participant shall be deemed to be invested as
follows:

 

(i)                                     Prior
to September 30, 2002, the amounts credited to the Non-Pension Benefit
Account of the Participant shall be deemed to be invested in Phantom Common
Stock. On each such date of investment, a Participant’s Account shall be
credited with the number of shares (including fractional shares) of Phantom
Common Stock which could have been purchased on such date, based upon the
Common Stock’s Purchase Price. As of the date upon which occurs the payment of
dividends on the Common Stock, there shall be credited with respect to shares
of Phantom Common Stock in the Participant’s Account on such date, such
additional shares (including fractional shares) of Phantom Common Stock as
follows:

 

(A)                              In the case of cash
dividends, such additional shares as could be purchased at the Purchase Price
with the dividends which would have been payable if the credited shares had
been outstanding;

 

(B)                                In the case of
dividends payable in property other than cash or Common Stock, such additional
shares as could be purchased at the Purchase Price with the fair market value
of the property which would have been payable if the credited shares had been
outstanding; or

 

(C)                                In the case of
dividends payable in Common Stock, such additional shares as would have been
payable on the credited shares if they had been outstanding.

 

(ii)                                  As
of September 30, 2002, the amounts credited to the Non-Pension Benefit
Account of the Participant shall be credited with deemed interest at the prime
rate as published in the Wall Street
Journal, compounded daily.

 

(ii)                                  As
of December 8, 2005, the cash value of the Phantom Common Stock (including
fractions thereof) credited to a Participant’s Account (based on the next day’s
closing price) shall no longer be deemed to be invested in Phantom Common Stock
but instead shall be

 

 

credited with deemed interest at the prime rate as
published in the Wall Street Journal, compounded
daily, consistent with the treatment of amounts credited to the Non-Pension
Benefit Account of the Participant after September 30, 2002

 

II.

 

Section 5.3(b) of
the Plan shall be amended by deleting such subsection in its entirety and
replacing it with the following new Section 5.3(b):

 

(b)                                 When a Participant terminates his employment
with the Employing Company (including any subsidiaries or affiliates thereof),
said Participant shall be entitled to receive the value of his Account in a
single lump sum cash distribution or annual cash installments not to exceed ten
(10). The Participant’s Account shall be valued as of the last business day of
the month in which the Participant terminates; provided, however, if the
Participant terminates within five (5) business days prior to the last day
of such month, the Participant’s Account may be valued as of the last
business day of the following month, at the Committee’s discretion. Such
distribution shall be paid in a single lump sum cash payment as soon as
administratively practicable following the valuation date.

 

III.

 

Section 5.3(d) of
the Plan shall be amended by deleting such subsection in its entirety and
replacing it with the following new Section 5.3(d):

 

(d)                                 Upon the death of a Participant, or a former
Participant prior to the payment of the value of said Participant’s Account,
the unpaid balance shall be paid in the sole discretion of the Committee (i) in
a lump sum to the designated Beneficiary of a Participant or former Participant
as soon as reasonably practicable following the last business day of the
calendar quarter in which the Committee is provided evidence of the Participant’s
death or (ii) in accordance with the distribution method chosen by such
Participant or former Participant. The Beneficiary designation may be
changed by the Participant or former Participant at any time without the consent
of the prior Beneficiary. In the event a Beneficiary designation is not on file
or the designated Beneficiary is deceased or cannot be located, payment will be
made to the person or persons in the first of the following classes of
successive preference, if then living:

 

(1)                                  the Participant’s spouse on the date of his
death;

(2)                                  the Participant’s children, equally;

(3)                                  the Participant’s parents, equally;

(4)                                  the Participant’s brothers and sisters,
equally; or

(5)                                  the Participant’s executors or
administrators.

 

Payment to such one or more
persons shall completely discharge the Plan with respect to the amount so paid.

 

2

 

IV.

 

Section 5.3(e) of
the Plan shall be amended by deleting such subsection in its entirety and
replacing it with the following new Section 5.3(e):

 

(e)                                 Upon the total disability of a Participant or
former Participant, as determined by the Committee, prior to the payment of the
value of such Participant’s Account, the unpaid balance of his Account shall be
paid in the sole discretion of the Committee (i) in a lump sum to the Participant
or former Participant, or his legal representative as soon as reasonably
practicable following the last business day of the calendar quarter following
the date on which the Committee makes the determination of the Participant’s
disability or (ii) in accordance with the distribution method elected by
such Participant or former Participant.

 

V.

 

Section 5.3(f) of
the Plan shall be amended by deleting such subsection in its entirety and
replacing it with the following new Section 5.3(f):

 

(f)                                   Notwithstanding the foregoing provisions of
this Section 5.3, if a Participant or Beneficiary becomes entitled to a
payment of his Account balance and such Account balance does not exceed $5,000,
said Participant shall receive the value of his Account in a single lump sum distribution.
The Participant’s Account shall be valued as of the last business day of the
month in which the Participant terminates; provided, however, if the
Participant terminates within five (5) business days prior to the last day
of such month, the Participant’s Account may be valued as of the last
business day of the following month, at the Committee’s discretion. Payments
shall be paid in a single lump sum cash payment as soon as administratively
practicable following the valuation date.

 

VI.

 

All parts of the Plan not inconsistent here
with are hereby ratified and confirmed.

 

IN WITNESS WHEREOF, Mirant Services, LLC, through its duly
authorized officer pursuant to a unanimous consent of the Committee dated December 8,
2005, has adopted this Fourth Amendment to the Mirant Services Supplemental
Benefit Plan, to be effective as of the 8th day of December, 2005.

 

 

	
   

  	
  MIRANT SERVICES, LLC:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Vance N. Booker

  	
   

  
	
   

  	
   

  	
  Vance N. Booker

  
	
   

  	
   

  	
  SVP, Administration

  

 

3Exhibit 10.33

 

 

$1,500,000,000

 

CREDIT AGREEMENT

 

among

 

MIRANT NORTH AMERICA, LLC,

as Borrower,

 

The Several Lenders from Time
to Time Parties Hereto,

 

JPMORGAN CHASE BANK, N.A.,

as Administrative Agent,

 

and

 

DEUTSCHE BANK SECURITIES INC. 

and

GOLDMAN SACHS CREDIT PARTNERS L.P.,

as Co-Syndication Agents

 

 

Dated as of January 3,
2006

 

 

 

J.P. MORGAN SECURITIES INC.,
DEUTSCHE BANK SECURITIES INC.

and GOLDMAN SACHS CREDIT PARTNERS L.P.,

as Joint Bookrunners

 

J.P. MORGAN SECURITIES INC. and
DEUTSCHE BANK SECURITIES INC.,

as Co-Lead Arrangers in respect of the Revolving Facility

 

J.P. MORGAN SECURITIES INC. and
GOLDMAN SACHS CREDIT PARTNERS L.P.,

as Co-Lead Arrangers in respect of the Term Facility

 

CREDIT SUISSE, LEHMAN
COMMERCIAL PAPER INC. and THE ROYAL BANK OF

SCOTLAND PLC, as Senior Managing Agents

 

CREDIT SUISSE and THE ROYAL
BANK OF SCOTLAND PLC,

as Co-Documentation Agents

 

 

$800,000,000 Revolving Facility

$700,000,000 Term Facility

 

 

TABLE OF
CONTENTS

 

	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 1.

  	
  DEFINITIONS

  	
  6

  
	
   

  	
   

  	
   

  	
   

  
	
  1.1.

  	
   

  	
  Defined Terms

  	
  6

  
	
  1.2.

  	
   

  	
  Other Definitional Provisions

  	
  30

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 2.

  	
  AMOUNT AND TERMS OF COMMITMENTS

  	
  30

  
	
   

  	
   

  	
   

  	
   

  
	
  2.1.

  	
   

  	
  Term Commitments

  	
  30

  
	
  2.2.

  	
   

  	
  Procedure for Term Loan Borrowing

  	
  30

  
	
  2.3.

  	
   

  	
  Repayment of Term Loans

  	
  31

  
	
  2.4.

  	
   

  	
  Revolving Commitments

  	
  31

  
	
  2.5.

  	
   

  	
  Procedure for Revolving Loan Borrowing

  	
  31

  
	
  2.6.

  	
   

  	
  Swingline Commitment

  	
  32

  
	
  2.7.

  	
   

  	
  Procedure for Swingline Borrowing;
  Refunding of SwinglineLoans

  	
  32

  
	
  2.8.

  	
   

  	
  Commitment Fees, etc.

  	
  34

  
	
  2.9.

  	
   

  	
  Termination or Reduction of Revolving
  Commitments

  	
  34

  
	
  2.10.

  	
   

  	
  Optional Prepayments

  	
  34

  
	
  2.11.

  	
   

  	
  Mandatory Prepayments and Commitment
  Reductions

  	
  35

  
	
  2.12.

  	
   

  	
  Conversion and Continuation Options

  	
  36

  
	
  2.13.

  	
   

  	
  Limitations on Eurodollar Tranches

  	
  37

  
	
  2.14.

  	
   

  	
  Interest Rates and Payment Dates

  	
  37

  
	
  2.15.

  	
   

  	
  Computation of Interest and Fees

  	
  38

  
	
  2.16.

  	
   

  	
  Inability to Determine Interest Rate

  	
  38

  
	
  2.17.

  	
   

  	
  Pro Rata Treatment and Payments

  	
  39

  
	
  2.18.

  	
   

  	
  Requirements of Law

  	
  40

  
	
  2.19.

  	
   

  	
  Taxes

  	
  41

  
	
  2.20.

  	
   

  	
  Indemnity

  	
  43

  
	
  2.21.

  	
   

  	
  Change of Lending Office

  	
  44

  
	
  2.22.

  	
   

  	
  Replacement of Lenders

  	
  44

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 3.

  	
  LETTERS OF CREDIT

  	
  44

  
	
   

  	
   

  	
   

  	
   

  
	
  3.1.

  	
   

  	
  Revolving L/C Commitment

  	
  44

  
	
  3.2.

  	
   

  	
  Procedure for Issuance of Revolving Letters
  of Credit

  	
  45

  
	
  3.3.

  	
   

  	
  Revolving L/C Fees and Other Charges

  	
  45

  
	
  3.4.

  	
   

  	
  Revolving L/C Participations

  	
  46

  
	
  3.5.

  	
   

  	
  Revolver L/C Reimbursement Obligation of
  the Borrower

  	
  47

  
	
  3.6.

  	
   

  	
  Synthetic L/C Letters of Credit

  	
  47

  

 

i

 

	
  3.7.

  	
   

  	
  Procedure for Issuance of Synthetic Letters
  of Credit

  	
  48

  
	
  3.8.

  	
   

  	
  Synthetic L/C Deposit Account

  	
  48

  
	
  3.9.

  	
   

  	
  Synthetic L/C Deposit Fees and Other Charges

  	
  49

  
	
  3.10.

  	
   

  	
  Synthetic L/C Reimbursement Obligations

  	
  50

  
	
  3.11.

  	
   

  	
  Obligations Absolute

  	
  50

  
	
  3.12.

  	
   

  	
  Letter of Credit Payments

  	
  50

  
	
  3.13.

  	
   

  	
  Applications

  	
  51

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 4.

  	
  REPRESENTATIONS AND WARRANTIES

  	
  51

  
	
   

  	
   

  	
   

  	
   

  
	
  4.1.

  	
   

  	
  Organization; Power and Authority

  	
  51

  
	
  4.2.

  	
   

  	
  Due Authorization

  	
  51

  
	
  4.3.

  	
   

  	
  Governmental Approval

  	
  51

  
	
  4.4.

  	
   

  	
  Binding and Enforceable

  	
  52

  
	
  4.5.

  	
   

  	
  No Violation

  	
  52

  
	
  4.6.

  	
   

  	
  No Default

  	
  52

  
	
  4.7.

  	
   

  	
  Litigation

  	
  52

  
	
  4.8.

  	
   

  	
  Financial Condition

  	
  52

  
	
  4.9.

  	
   

  	
  Material Adverse Change

  	
  53

  
	
  4.10.

  	
   

  	
  Investment Company Act; Public Utility
  Holding Company Act

  	
  53

  
	
  4.11.

  	
   

  	
  Environmental Matters

  	
  53

  
	
  4.12.

  	
   

  	
  Accuracy of Information, etc

  	
  53

  
	
  4.13.

  	
   

  	
  Employee Benefit Plans

  	
  53

  
	
  4.14.

  	
   

  	
  Tax Returns and Payments

  	
  53

  
	
  4.15.

  	
   

  	
  Security Documents

  	
  54

  
	
  4.16.

  	
   

  	
  Ownership of Property

  	
  54

  
	
  4.17.

  	
   

  	
  Labor Matters

  	
  54

  
	
  4.18.

  	
   

  	
  Subsidiaries

  	
  54

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 5.

  	
  CONDITIONS PRECEDENT

  	
  55

  
	
   

  	
   

  	
   

  	
   

  
	
  5.1.

  	
   

  	
  Conditions to Initial Extension of Credit

  	
  55

  
	
  5.2.

  	
   

  	
  Conditions to Each Extension of Credit

  	
  58

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 6.

  	
  AFFIRMATIVE COVENANTS

  	
  58

  
	
   

  	
   

  	
   

  	
   

  
	
  6.1.

  	
   

  	
  Compliance with Law; Maintenance of
  Existence

  	
  58

  
	
  6.2.

  	
   

  	
  Financial Statements

  	
  58

  
	
  6.3.

  	
   

  	
  Certificates; Other Information

  	
  59

  
	
  6.4.

  	
   

  	
  Notices

  	
  60

  
	
  6.5.

  	
   

  	
  Inspection

  	
  61

  

 

ii

 

	
  6.6.

  	
   

  	
  Maintenance of Property; Insurance

  	
  61

  
	
  6.7.

  	
   

  	
  Subsequent Acquired Property; New
  Subsidiaries

  	
  61

  
	
  6.8.

  	
   

  	
  Collateral Information

  	
  63

  
	
  6.9.

  	
   

  	
  Further Assurances

  	
  63

  
	
  6.10.

  	
   

  	
  Use of Proceeds

  	
  63

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 7.

  	
  FINANCIAL COVENANTS

  	
  64

  
	
   

  	
   

  	
   

  	
   

  
	
  7.1.

  	
   

  	
  Interest Coverage Ratio

  	
  64

  
	
  7.2.

  	
   

  	
  Leverage Ratio

  	
  64

  
	
  7.3.

  	
   

  	
  Capital Expenditures

  	
  64

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 8.

  	
  NEGATIVE COVENANTS

  	
  65

  
	
   

  	
   

  	
   

  	
   

  
	
  8.1.

  	
   

  	
  Debt

  	
  65

  
	
  8.2.

  	
   

  	
  Restricted Payments

  	
  65

  
	
  8.3.

  	
   

  	
  Liens

  	
  66

  
	
  8.4.

  	
   

  	
  Mergers

  	
  68

  
	
  8.5.

  	
   

  	
  Asset Sales

  	
  68

  
	
  8.6.

  	
   

  	
  Investments

  	
  69

  
	
  8.7.

  	
   

  	
  Transactions with Affiliates

  	
  70

  
	
  8.8.

  	
   

  	
  Sales and Leasebacks

  	
  71

  
	
  8.9.

  	
   

  	
  Changes in Fiscal Periods

  	
  71

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 9.

  	
  EVENTS OF DEFAULT

  	
  71

  
	
   

  	
   

  	
   

  	
   

  
	
  SECTION 10.

  	
  THE AGENTS

  	
  74

  
	
   

  	
   

  	
   

  	
   

  
	
  10.1.

  	
   

  	
  Appointment

  	
  74

  
	
  10.2.

  	
   

  	
  Delegation of Duties

  	
  74

  
	
  10.3.

  	
   

  	
  Exculpatory Provisions

  	
  74

  
	
  10.4.

  	
   

  	
  Reliance by Administrative Agent

  	
  75

  
	
  10.5.

  	
   

  	
  Notice of Default

  	
  75

  
	
  10.6.

  	
   

  	
  Non-Reliance on Agents and Other Lenders

  	
  75

  
	
  10.7.

  	
   

  	
  Indemnification

  	
  76

  
	
  10.8.

  	
   

  	
  Agent in Its Individual Capacity

  	
  76

  
	
  10.9.

  	
   

  	
  Successor Administrative Agent

  	
  76

  
	
  10.10.

  	
   

  	
  Co- Syndication Agents

  	
  77

  
	
  10.11.

  	
   

  	
  Intercreditor Agreements

  	
  77

  

 

iii

 

	
  SECTION 11.

  	
  MISCELLANEOUS

  	
  77

  
	
   

  	
   

  	
   

  	
   

  
	
  11.1.

  	
   

  	
  Amendments and Waivers

  	
  77

  
	
  11.2.

  	
   

  	
  Notices

  	
  79

  
	
  11.3.

  	
   

  	
  No Waiver; Cumulative Remedies

  	
  81

  
	
  11.4.

  	
   

  	
  Survival of Representations and Warranties

  	
  81

  
	
  11.5.

  	
   

  	
  Payment of Expenses and Taxes

  	
  81

  
	
  11.6.

  	
   

  	
  Successors and Assigns; Participations and
  Assignments

  	
  83

  
	
  11.7.

  	
   

  	
  Adjustments; Set-off

  	
  86

  
	
  11.8.

  	
   

  	
  Counterparts

  	
  87

  
	
  11.9.

  	
   

  	
  Severability

  	
  87

  
	
  11.10.

  	
   

  	
  Integration

  	
  87

  
	
  11.11.

  	
   

  	
  GOVERNING LAW

  	
  87

  
	
  11.12.

  	
   

  	
  Submission To Jurisdiction; Waivers

  	
  87

  
	
  11.13.

  	
   

  	
  Acknowledgements

  	
  88

  
	
  11.14.

  	
   

  	
  Releases of Guarantees and Liens

  	
  88

  
	
  11.15.

  	
   

  	
  Confidentiality

  	
  89

  
	
  11.16.

  	
   

  	
  WAIVERS OF JURY TRIAL

  	
  89

  
	
  11.17.

  	
   

  	
  Delivery of Addenda

  	
  89

  

 

iv

 

	
  SCHEDULES:

  	
   

  
	
   

  	
   

  	
   

  
	
  1.1A

  	
  Commitments

  	
   

  
	
  1.1B

  	
  Mortgaged Property

  	
   

  
	
  1.1C

  	
  Existing Debt

  	
   

  
	
  4.15(a)

  	
  UCC Filing Jurisdictions

  	
   

  
	
  4.15(b)

  	
  Mortgage Filing Jurisdictions

  	
   

  
	
  4.18

  	
  Subsidiaries

  	
   

  
	
  8.1

  	
  Subordinated Indebtedness

  	
   

  
	
  8.3(l)

  	
  Existing Liens

  	
   

  
	
  8.6(l)

  	
  Existing Investments

  	
   

  
	
  8.7

  	
  MET Agreements

  	
   

  
	
   

  	
   

  	
   

  
	
  EXHIBITS:

  	
   

  
	
   

  	
   

  	
   

  
	
  A

  	
  Form of Guarantee and Collateral Agreement

  	
   

  
	
  B

  	
  Form of Compliance Certificate

  	
   

  
	
  C

  	
  Form of Closing Certificate

  	
   

  
	
  D

  	
  Form of Mortgage

  	
   

  
	
  E

  	
  Form of Assignment and Assumption

  	
   

  
	
  F

  	
  Form of Legal Opinion of White & Case LLP

  	
   

  
	
  G

  	
  Form of Exemption Certificate

  	
   

  
	
  H

  	
  Form of Addendum

  	
   

  
	
  I

  	
  Form of First Lien/Second Lien Intercreditor Agreement

  	
   

  
	
  J-1

  	
  Form of Letter of Credit Application of JPMCB

  	
   

  
	
  J-2

  	
  Form of Letter of Credit Application of DBTCA

  	
   

  
	
  K

  	
  Form of Permitted Pari Passu Debt Intercreditor Agreement

  	
   

  

 

 

v

 

CREDIT AGREEMENT (this “Agreement”),
dated as of January 3, 2006, among MIRANT NORTH AMERICA, LLC, a Delaware
limited liability company (the “Borrower”), the several banks and other
financial institutions or entities from time to time parties to this Agreement
(the “Lenders”), DEUTSCHE BANK SECURITIES INC. and GOLDMAN SACHS CREDIT
PARTNERS L.P., as co-syndication agents (in such capacity, the “Co-Syndication
Agents”), and JPMORGAN CHASE BANK, N.A. (“JPMCB”), as administrative
agent.

 

RECITALS

 

WHEREAS, on July 14, 2003, Mirant
Corporation and certain of its Domestic Subsidiaries and Affiliates (each as
defined below) filed voluntary petitions for relief (the “Chapter 11 Cases”)
under Chapter 11 of Title 11 of the United States Code (as amended, the “Bankruptcy
Code”) with the United States Bankruptcy Court for the Northern District of
Texas, Fort Worth Division (the “Bankruptcy Court”), and continued in
possession of their property and in the management of their businesses pursuant
to Bankruptcy Code Sections 1107 and 1108;

 

WHEREAS, on December 9, 2005, the
Bankruptcy Court entered an order (the “Confirmation Order”) confirming
the Plan of Reorganization (as defined below); and

 

WHEREAS, in connection with confirmation and
implementation of the Plan of Reorganization, the Borrower has requested the
Lenders to make loans and other extensions of credit available to it to enable
it to finance a part of the Plan of Reorganization and pay related fees and
expenses, and the Lenders have agreed, subject to the terms and conditions
hereof, to enter into this Agreement.

 

Accordingly, the parties hereto hereby agree
as follows:

 

SECTION 1.  DEFINITIONS

 

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

 

“ABR”: 
for any day, a rate per annum (rounded upwards, if necessary, to the
next 1/16 of 1%) equal to the greater of (a) the Prime Rate in effect on
such day and (b) the Federal Funds Effective Rate in effect on such day
plus 1⁄2 of 1%. For purposes hereof, “Prime Rate” shall mean the rate of
interest per annum publicly announced from time to time by JPMCB, as its prime
rate in effect at its principal office in New York City (the Prime Rate not
being intended to be the lowest rate of interest charged by JPMCB, in
connection with extensions of credit to debtors). Any change in the ABR due to
a change in the Prime Rate or the Federal Funds Effective Rate shall be
effective as of the opening of business on the effective day of such change in
the Prime Rate or the Federal Funds Effective Rate, respectively.

 

“ABR Loans”:  Loans the rate of interest applicable to
which is based upon the ABR.

 

“Addendum”:  an instrument, substantially in the form of Exhibit H,
by which a Lender becomes a party to this Agreement as of the Closing Date.

 

6

 

“Adjustment Date”:  as defined in the Pricing Grid.

 

“Administrative Agent”:  JPMCB, together with its affiliates, as the
arranger of the Commitments and as the administrative agent for the Lenders
under this Agreement and the other Loan Documents, together with any of its
successors.

 

“Affiliate”:  as to any Person (other than an individual),
any other Person (other than an individual) that, directly or indirectly
through one or more intermediaries, is in Control of, is Controlled by, or is
under common Control with, such Person.

 

“Affiliate Subordinated Debt”:  Subordinated Debt of the Borrower which is
owed to or held by an Affiliate of the Borrower other than a Subsidiary of the
Borrower.

 

“Agents”:  the collective reference to the
Co-Syndication Agents and the Administrative Agent.

 

“Aggregate Exposure”:  with respect to any Lender at any time, an
amount equal to (a) until the Closing Date, the aggregate amount of such
Lender’s Commitments at such time and (b) thereafter, the sum of (i) the
aggregate then unpaid principal amount of such Lender’s Term Loans and (ii) the
amount of such Lender’s Revolving Commitment then in effect or, if the
Revolving Commitments have been terminated, the amount of such Lender’s
Revolving Extensions of Credit then outstanding.

 

“Aggregate Exposure Percentage”:  with respect to any Lender at any time, the
ratio (expressed as a percentage) of such Lender’s Aggregate Exposure at such
time to the Aggregate Exposure of all Lenders at such time.

 

“Agreement”:  as defined in the preamble hereto.

 

“Applicable Margin”:  for each Type of Loan, the rate per annum set
forth under the relevant column heading below:

 

	
   

  	
   

  	
  ABR Loans

  	
   

  	
  Eurodollar Loans

  	
   

  
	
  Revolving
  Loans and Swingline Loans

  	
   

  	
  1.25

  	
  %

  	
  2.25

  	
  %

  
	
  Term Loans

  	
   

  	
  0.75

  	
  %

  	
  1.75

  	
  %

  

 

provided, that on
and after the first Adjustment Date occurring after the completion of one full
fiscal quarter of the Borrower after the Closing Date, the Applicable Margin
with respect to Revolving Loans and Swingline Loans will be determined pursuant
to the Pricing Grid.

 

“Application”:  an application in the form attached hereto as
Exhibit J-1 with respect to JPMCB, in the form attached hereto as Exhibit J-2
with respect to DBTCA or, with respect to any other Issuing Lender, in such
form as such Issuing Lender may specify from time to time, requesting such
Issuing Lender to open a Letter of Credit.

 

“Approved Fund”:  as defined in Section 11.6(b).

 

7

 

“Arrangers”:  the collective reference to J.P. Morgan
Securities Inc., Deutsche Bank Securities Inc. and Goldman Sachs Credit
Partners L.P.

 

“Assets”:  with respect to any Person, all or any part
of its business, property and assets, both tangible and intangible, wherever
situated.

 

“Asset Sale”: any Disposition or
series of related Dispositions other than any Excluded Asset Sale.

 

“Assignee”:  as defined in Section 11.6(b).

 

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

 

“Available Revolving Commitment”:  as to any Revolving Lender at any time, an
amount equal to the excess, if any, of (a) such Lender’s Revolving
Commitment then in effect over (b) such Lender’s Revolving
Extensions of Credit then outstanding; provided, that in calculating any
Lender’s Revolving Extensions of Credit for the purpose of determining such
Lender’s Available Revolving Commitment pursuant to Section 2.8(a), the
aggregate principal amount of Swingline Loans then outstanding shall be deemed
to be zero.

 

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

 

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

 

“Benefitted Lender”:  as defined in Section 11.7(a).

 

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

 

“Borrower”:  as defined in the preamble hereto.

 

“Borrowing Date”:  any Business Day specified by the Borrower as
a date on which the Borrower requests the relevant Lenders to make Loans
hereunder.

 

“Business Day”:  a day other than a Saturday, Sunday or other
day on which commercial banks in New York City are authorized or required by
law to close, provided, that with respect to notices and determinations
in connection with, and payments of principal and interest on, Eurodollar
Loans, such day is also a day for trading by and between banks in Dollar
deposits in the interbank eurodollar market.

 

“Capital Expenditures”:  for any period, with respect to any Person,
the aggregate of all expenditures by such Person and its Subsidiaries for the
acquisition or leasing (pursuant to a capital lease) of fixed or capital assets
or additions to equipment (including replacements, repairs and improvements
during such period) that should be capitalized under GAAP on a consolidated
balance sheet of such Person and its Subsidiaries. For purposes of this
definition, the purchase price of equipment that is purchased simultaneously
with the trade-in of existing equipment or with insurance proceeds shall be
included in Capital Expenditures only to the

 

8

 

extent of the gross amount of such purchase price less the credit
granted by the seller of such equipment for the equipment being traded in at
such time or the amount of such proceeds, as the case may be.

 

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

 

“Cash Equivalents”:  (a) marketable direct obligations issued
by, or unconditionally guaranteed by, the United States Government or issued by
any agency thereof and backed by the full faith and credit of the United
States, in each case maturing within one year from the date of acquisition; (b) certificates
of deposit, time deposits, eurodollar time deposits or overnight bank deposits
having maturities of six months or less from the date of acquisition issued by
any Lender or by any commercial bank organized under the laws of the United
States or any state thereof having combined capital and surplus of not less
than $500,000,000; (c) commercial paper of an issuer rated at least A-1 by
S&P or P-1 by Moody’s, or carrying an equivalent rating by a nationally
recognized rating agency, if both of the two named rating agencies cease
publishing ratings of commercial paper issuers generally, and maturing within
six months from the date of acquisition; (d) repurchase obligations of any
Lender or of any commercial bank satisfying the requirements of clause (b) of
this definition, having a term of not more than 30 days, with respect to
securities issued or fully guaranteed or insured by the United States
government; (e) securities with maturities of one year or less from the
date of acquisition issued or fully guaranteed by any state, commonwealth or
territory of the United States, by any political subdivision or taxing authority
of any such state, commonwealth or territory or by any foreign government, the
securities of which state, commonwealth, territory, political subdivision,
taxing authority or foreign government (as the case may be) are rated at least
A by S&P or A by Moody’s; (f) securities with maturities of six months
or less from the date of acquisition backed by standby letters of credit issued
by any Lender or any commercial bank satisfying the requirements of clause (b) of
this definition; (g) money market mutual or similar funds that invest
exclusively in assets satisfying the requirements of clauses (a) through (f) of
this definition; or (h) money market funds that (i) (x) comply with
the criteria set forth in SEC Rule 2a-7 under the Investment Company Act
of 1940, as amended and are rated A by S&P and A by Moody’s or (y) are
rated AAA by S&P and Aaa by Moody’s and (ii) have portfolio assets of
at least $2,500,000,000.

 

“Chapter 11 Cases”:  as defined in the recitals hereto.

 

“Closing Date”:  the date on which the conditions precedent
set forth in Section 5.1 shall have been satisfied or waived, which date
is January 3, 2006.

 

“Co-Syndication Agents”:  as defined in the preamble hereto.

 

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

 

9

 

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

 

“Commitment”:  as to any Lender, the sum of the Term
Commitment and the Revolving Commitment of such Lender.

 

“Commitment Fee Rate”:  0.375% per annum; provided, that on
and after the first Adjustment Date occurring after the completion of one full
fiscal quarter of the Borrower after the Closing Date, the Commitment Fee Rate
will be determined pursuant to the Pricing Grid.

 

“Common Stock”: with respect to any
Person, any and all shares, interests or other participations in, and other
equivalents (however designated and whether voting or non-voting) of such
Person’s common stock whether or not outstanding on the Closing Date, including
all series and classes of such common stock.

 

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

 

“Conduit Lender”:  any special purpose corporation organized and
administered by any Lender for the purpose of making Loans otherwise required
to be made by such Lender and designated by such Lender in a written
instrument; provided, that the designation by any Lender of a Conduit
Lender shall not relieve the designating Lender of any of its obligations to
fund a Loan under this Agreement if, for any reason, its Conduit Lender fails
to fund any such Loan, and the designating Lender (and not the Conduit Lender)
shall have the sole right and responsibility to deliver all consents and
waivers required or requested under this Agreement with respect to its Conduit
Lender, and provided, further, that no Conduit Lender shall (a) be
entitled to receive any greater amount pursuant to Section 2.18, 2.19,
2.20 or 11.5 than the designating Lender would have been entitled to receive in
respect of the extensions of credit made by such Conduit Lender or (b) be
deemed to have any Commitment.

 

“Confidential Information Memorandum”:  the Confidential Information Memorandum dated
December 2005 and furnished to certain Lenders.

 

“Confirmation Order”:  as defined in the recitals hereto.

 

“Consolidated Capitalization”: the sum
of Consolidated Total Debt and Consolidated Net Worth.

 

“Consolidated Net Worth”:  at any date, all amounts that would, in
conformity with GAAP, be included on a consolidated balance sheet of the
Borrower and its Subsidiaries in the Capital Stock and other equity accounts
(including, without limitation, retained earnings and paid-in capital but
excluding accumulated other comprehensive income) at such date.

 

“Consolidated Total Debt”:  at any date, the aggregate principal amount
of all Debt of the Borrower and its Subsidiaries at such date, determined on a
consolidated basis in accordance with GAAP.

 

10

 

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

 

“Control”: has the meaning set forth
in Rule 12b-2 under the Exchange Act.

 

“Corporate Interest”: for any period,
the aggregate of interest expense accrued during such period by the Borrower
and its consolidated Subsidiaries on Debt less the sum of (a) the amount
of interest, if any, included in such interest expense which was capitalized in
accordance with GAAP, (b) an amount equal to the percentage of the interest
expense of any Subsidiary corresponding to the percentage of the EBITDA of such
Subsidiary not taken into account in determining EBITDA for such period
pursuant to the proviso to the first sentence of the definition thereof and (c) interest
income accrued on the Synthetic L/C Deposit, subject to the last sentence of
the definition of EBITDA.

 

“DBTCA”:  Deutsche Bank Trust Company Americas.

 

“Debt”:  for any Person, any obligations of such
Person for or in respect of (a) moneys borrowed or raised (whether or not
for cash) by whatever means including acceptances, deposits, discounting,
reimbursement obligations for drawn letters of credit, factoring (other than on
a non-recourse basis), Finance Leases, hire purchase, conditional sale or other
form of title retention agreement, sale-and-lease back, sale and repurchase and
any other form of financing which is recognized in such Person’s financial
statements as being in the nature of a borrowing (excluding for the avoidance
of doubt, asset retirement obligations, share capital, share premium account
and any capital prepayment reserve), (b) the deferred purchase price of
Assets or services (other than goods and services obtained on normal commercial
terms in the ordinary course of business or operations), and (c) all
Guarantee Obligations of such Person in respect of obligations of the kind
referred to in clauses (a) and (b) above. Notwithstanding the
foregoing, (x) any of the obligations identified in the immediately foregoing
sentence owed by any Subsidiary of the Borrower to the Borrower or to any other
Subsidiary of the Borrower shall not constitute “Debt”, (y) Affiliate
Subordinated Debt shall not constitute “Debt” and (z) notwithstanding that
after the Closing Date the obligations under the Facility Lease Documents shall
be required to be accounted for as a Finance Lease (other than as a result of
any amendment to the Facility Lease Documents), such obligations shall not
constitute “Debt” for purposes of this Agreement.

 

“Default”:  any of the events specified in Section 9,
whether or not any requirement for the giving of notice, the lapse of time, or
both, has been satisfied.

 

“Designated Party”:  has the meaning set forth in Section 9(g).

 

“Disposition”:  (a) with respect to any Assets, any
sale, lease conveyance or other disposition thereof and (b) the sale or
issuance of Capital Stock in any of the Restricted Subsidiaries. The terms “Dispose”
and “Disposed of” shall have correlative meanings.

 

“Disqualified Stock”: means, with
respect to any Person, any Capital Stock of such Person which by its terms (or
by the terms of any security into which it is convertible or for which it is
exchangeable) or upon the happening of any event:

 

11

 

(1)                                  matures
or is mandatorily redeemable pursuant to a sinking fund obligation or
otherwise;

 

(2)                                  is
convertible or exchangeable for Debt or Disqualified Stock (excluding Capital
Stock which is convertible or exchangeable solely at the option of the Company
or a Restricted Subsidiary); or

 

(3)                                  is
redeemable at the option of the holder of the Capital Stock in whole or in
part,

 

in each case on or prior to the date that is 91 days after the earlier
of (x) the date on which there are no Loans outstanding and the Commitments
have been terminated and (y) the seventh anniversary of the Closing Date, provided
that only the portion of Capital Stock which so matures or is mandatorily
redeemable, is so convertible or exchangeable or is so redeemable at the option
of the holder thereof prior to such date will be deemed to be Disqualified
Stock; provided, further that any Capital Stock that would
constitute Disqualified Stock solely because the holders thereof have the right
to require the Company to repurchase such Capital Stock upon the occurrence of
a change of control or asset sale (each defined in a substantially identical
manner to the corresponding definitions herein) shall not constitute
Disqualified Stock if the terms of such Capital Stock (and all such securities
into which it is convertible or for which it is ratable or exchangeable)  provide that the Company may not repurchase
or redeem any such Capital Stock (and all such securities into which it is
convertible or for which it is ratable or exchangeable) pursuant to such
provision prior to compliance by the Borrower with Section 7, Section 8.2
and Section 8.5.

 

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

 

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

 

“EBITDA”:  for any period, with reference to the
Borrower’s consolidated financial statements (a) income from continuing
operations before income taxes and minority interest; plus (b) depreciation
and amortization; plus (c) Corporate Interest; provided, however
that in determining EBITDA for the purposes of the Interest Coverage Ratio
under Sections 7.1, 7.4(b) and 8.2 and the definition of “Free Cash Flow”
only,  the amounts referred to in (a), (b) and
(c) above for a consolidated Subsidiary of the Borrower will not be
included to the extent that such Subsidiary is prohibited from making
distributions or dividends as of the date of determination (unless such
prohibition arises solely from the requirement under the Facility Lease Documents
that MIRMA and its Subsidiaries deliver financial statements for the most
recently completed fiscal year or fiscal quarter, as the case may be, and the
date of determination is less than 90 or 60 days, as the case may be, from the
end of such fiscal year or fiscal quarter). “EBITDA” shall not include the
effect of (i) gains or losses on sales or dispositions of Assets; (ii) non-recurring
items (including, for the avoidance of doubt, restructuring expenses) or (iii) non-cash
expenses and non-cash gains or losses, including as a result of Swap Agreements
being marked to market and the effects of “fresh start” accounting under SOP
90-7, but shall include cash payments and receipts from and in respect of
settlement of Swap Agreements. In addition, if, but for clause (z) of the last
sentence in the definition of “Debt”, the obligations under the Facility Lease
Documents would otherwise constitute Debt hereunder, for purposes of

 

12

 

calculating EBITDA, the amounts paid under the Facility Lease Documents
shall be treated as expenses for purposes of determining income from continuing
operations, and no portion of such amounts shall be treated as Corporate
Interest or principal amortization, such that, to the extent possible, the
treatment of the obligations under the Facility Lease Documents as such
obligations are treated on the date hereof is preserved.

 

For the purposes of calculating EBITDA for
any period of four consecutive fiscal quarters (each, a “Reference Period”)
pursuant to any determination of the Leverage Ratio, (i) if at any time
during such Reference Period the Borrower or any Subsidiary shall have made any
Material Disposition, the EBITDA for such Reference Period shall be reduced by
an amount equal to the EBITDA (if positive) attributable to the property that
is the subject of such Material Disposition for such Reference Period or
increased by an amount equal to the EBITDA (if negative) attributable thereto
for such Reference Period and (ii) if during such Reference Period the
Borrower or any Subsidiary shall have made a Material Acquisition, EBITDA for
such Reference Period shall be calculated after giving pro  forma
effect thereto as if such Material Acquisition occurred on the first day of
such Reference Period. As used in this definition, “Material Acquisition” means
any acquisition of property or series of related acquisitions of property that (a) constitutes
assets comprising all or substantially all of an operating unit of a business
or constitutes all or substantially all of the common stock of a Person and (b) involves
the payment of consideration by the Borrower and its Subsidiaries in excess of
$20,000,000; and “Material Disposition” means any Disposition of property or
series of related Dispositions of property that yields gross proceeds to the
Borrower or any of its Subsidiaries in excess of $20,000,000.

 

“Environmental Capital Expenditures”:
capital expenditures required by, or reasonably related to the Borrower’s or
its Subsidiaries’ compliance with, Environmental Laws.

 

“Environmental Laws”:  any and all foreign, Federal, state, local or
municipal laws, rules, orders, regulations, statutes, ordinances, codes,
decrees, requirements of any Governmental Authority or other Requirements of
Law (including common law) regulating, relating to or imposing liability or
standards of conduct concerning protection of human health or the environment,
as now or may at any time hereafter be in effect.

 

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

 

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

 

“ERISA Event”:  any of the following events: (i) the
appointment of a trustee to administer or terminate any Plan, (ii) the
termination of a Plan, (iii) the existence of any “accumulated funding
deficiency” (as defined in Section 302 of ERISA) with respect to a Plan, (iv) the
imposition of a Lien under the Code or ERISA on the assets of the Borrower on
account of any Plan, (v) the occurrence of a reportable event described in
Section 4043(c) of ERISA (other than those events as to which the
30-day notice period is waived) with respect to a Plan, or

 

13

 

(vi) the incurrence by the Borrower of any liability in connection
with a withdrawal from, or the insolvency or reorganization of, a multiemployer
pension plan.

 

“Eurocurrency Reserve Requirements”:  for any day as applied to a Eurodollar 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 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) maintained by a member bank of the Federal Reserve System.

 

“Eurodollar Rate”:  with respect to each day during each Interest
Period pertaining to a Eurodollar Loan, the rate per annum determined on the
basis of the rate for deposits in Dollars for a period equal to such Interest
Period commencing on the first day of such Interest Period appearing on Page 3750
of the Telerate screen as of 11:00 A.M., London time, two Business Days
prior to the beginning of such Interest Period. In the event that such rate
does not appear on Page 3750 of the Telerate screen (or otherwise on such
screen), the “Eurodollar Rate” shall be determined by reference to such
other comparable publicly available service for displaying eurodollar rates as
may be selected by the Administrative Agent or, in the absence of such
availability, by reference to the rate at which the Administrative Agent is
offered Dollar deposits at or about 11:00 A.M., New York City time, two
Business Days prior to the beginning of such Interest Period in the interbank
eurodollar market where its eurodollar and foreign currency and exchange
operations are then being conducted for delivery on the first day of such
Interest Period for the number of days comprised therein.

 

“Eurodollar Loans”:  Loans the rate of interest applicable to
which is based upon the Eurodollar Rate.

 

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

 

“Event of Default”:  any of the events specified in Section 9,
provided that any requirement for the giving of notice, the lapse of
time, or both, has been satisfied.

 

“Exchange Act”:  the Securities Exchange Act of 1934, as
amended from time to time.

 

“Excluded Asset Sale”:  each of the following transactions:

 

(i)                                     the
Disposition of obsolete, uneconomic or worn out property, or property which in
the good faith judgment of the Borrower is no longer useful in its business, in
each case, in the ordinary course of business;

 

(ii)                                  the
Disposition of inventory in the ordinary course of business;

 

(iii)                               Dispositions
to the Borrower or any Subsidiary Guarantor;

 

14

 

(iv)                              Dispositions
of Cash Equivalents or other short-term investments;

 

(v)                                 the
Disposition by the Borrower or any Subsidiary of power, capacity, fuel and
other products or services, in each case in the ordinary course of business (it
being understood that a Disposition of a quantity of power, capacity or fuel
that is material to the Borrower or such Subsidiary, as the case may be, shall
not alone cause such Disposition to be not in the ordinary course of business);

 

(vi)                              sales
by the Borrower or any Subsidiary of emission credits in the ordinary course of
business (it being understood that a Disposition of a quantity of emissions
credits that is material to the Borrower or such Subsidiary, as the case may
be, shall not alone cause such Disposition to be not in the ordinary course of
business);

 

(vii)                           any
Disposition of Assets or series of related Dispositions of Assets having a
value not in excess of $10,000,000;

 

(viii)                        Restricted
Payments permitted by the Section 8.2;

 

(ix)                                Disposition
of Assets in connection with a foreclosure, transfer or deed in lieu of
foreclosure or other exercise of remedial action;

 

(x)                                   Compromises
and settlements of claims against third-parties and, in an amount not to exceed
$10,000,000, Dispositions of Assets in connection with the settlement of claims
and litigation;

 

(xi)                                Dispositions
made pursuant to the Plan of Reorganization; and

 

(xii)                             Grants
by the Borrower or any of its Subsidiaries of licenses, sublicenses, leases or
subleases or easements to other Persons not materially interfering with the
conduct by the Borrower or such Subsidiary of its business on or at the
property that is the subject of such license, sublicense, lease or sublease or
easement.

 

“Excluded Foreign Subsidiary”:  any Foreign Subsidiary in respect of which
either (a) the pledge of all of the Capital Stock of such Subsidiary as
Collateral or (b) the guaranteeing by such Subsidiary of the Obligations,
would, in the good faith judgment of the Borrower, result in adverse tax
consequences to the Borrower.

 

“Facility”:  each of (a) the Term Commitments and the
Term Loans made thereunder (the “Term Facility”) and (b) the
Revolving Commitments and the extensions of credit made thereunder (the “Revolving
Facility”).

 

“Facility Lease Documents”:  the eleven Facility Lease Agreements, dated December 19,
2000, the related Participation Agreements and all other agreements entered
into in connection therewith and related thereto, in each case as amended,
modified, or supplemented from time to time.

 

15

 

“FCF Percentage”:  50%; provided that, with respect to
each fiscal year of the Borrower, the FCF Percentage shall be reduced to 25% if
the Leverage Ratio as of the last day of such fiscal year is not greater than
2.0 to 1.0.

 

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

 

“Fee Payment Date”:  (a) the third Business Day following the
last day of each March, June, September and December and (b) the
last day of the Revolving Commitment Period.

 

“Finance Leases”:  as to any Person, the obligations of such
Person to pay rent or other amounts under any lease of (or other arrangement
conveying the right to use) real or personal property, or a combination
thereof, which obligations are required to be classified and accounted for as
capital leases on a balance sheet of such Person under GAAP and, for the
purposes of this Agreement, the amount of such obligations at any time shall be
the capitalized amount thereof at such time determined in accordance with GAAP.

 

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

 

“Free Cash Flow”:  for any fiscal period of the Borrower, without
duplication, (a) EBITDA for such period minus (b) Corporate Interest for such
period minus (c) the aggregate amount of any cash payments made in
respect of taxes during such period by the Borrower or any of its consolidated
Subsidiaries net of cash tax refunds for such period minus (d) the aggregate amount of all
scheduled principal payments of Debt, if any, of the Borrower and its
consolidated Subsidiaries made during such period minus (e) Capital
Expenditures made by the Borrower and its consolidated Subsidiaries for such
period (other than Capital Expenditures made with (w) Net Cash Proceeds of
Asset Sales, (x) Net Cash Proceeds of Recovery Events, (y) amounts reserved in
a prior period for Capital Expenditures (to the extent deducted from Free Cash
Flow in such period in accordance with clause (f) of this definition) and
(z) the proceeds of the incurrence of Permitted Debt) minus (f) amounts
reserved by the Borrower and its consolidated Subsidiaries during such period
for Capital Expenditures to be made by the Borrower and its consolidated
Subsidiaries in any subsequent period plus (g) amounts received by
the Borrower or its consolidated Subsidiaries during such period with respect
to equity contributions made by an Affiliate of the Borrower or Affiliate
Subordinated Debt plus (h) amounts received by the Borrower or its
consolidated Subsidiaries during such period pursuant to the MAI Series A
Preferred Shares plus (i) the
Net Cash Proceeds of Asset Sales and Recovery Events (to the extent not
reflected in clauses (e) and (f) above or otherwise required to be
applied to the prepayment of the Loans pursuant to Section 2.11); provided
that, in the case of any consolidated Subsidiary of the Borrower whose
contribution to EBITDA is reduced in accordance with the proviso to the first
sentence of the definition of “EBITDA”, the amounts deducted from Free Cash
Flow in accordance with clauses (c), (d), (e) and (f) above for such

 

16

 

Subsidiary shall, in each case, be reduced by an amount equal to the
percentage of such deduction corresponding to the percentage of the EBITDA of
such Subsidiary not taken into account in determining EBITDA for such period.

 

“Free Cash Flow Application Date”:  as defined in Section 2.11(b).

 

“FSA” means (a) an arms-length,
executed, valid and binding agreement (including, without limitation, a tolling
agreement) that is then in full force and effect and not in default in any
material respect and which is not terminable without cause between the Borrower
or any Subsidiary and either:

 

(i)                                     a
third party purchaser whose, or whose obligations are unconditionally
guaranteed by an entity whose, long-term senior unsecured debt is rated no less
than Baa3 by Moody’s and BBB- by S&P on the date the relevant transaction
is entered into by the Borrower or such Subsidiary; or

 

(ii)                                  an
Affiliate of the Borrower, so long as such Affiliate has executed a valid and
binding agreement with a third party purchaser whose, or whose obligations are
unconditionally guaranteed by an entity whose, long-term senior unsecured debt
is rated no less than Baa3 by Moody’s and BBB- by S&P on the date the
relevant transaction is entered into by the Borrower or such Subsidiary with
substantially the same terms (other than any pricing spread) as the Affiliate’s
agreement with the Borrower or such Subsidiary;

 

in each case, for the purchase of fuel (on a take or pay, take and pay,
or take, if tendered basis) at prices established at a formula, index or other
price risk management methodology not based on spot market prices by the
Borrower or such Subsidiary to the third party or Affiliate; or

 

(b)                                 financial hedge
agreements relating to fuel pricing that are:

 

(i)                                     fully
supported by available fuel of the Borrower and its Subsidiaries; and

 

(ii)                                  with
counterparties having, or whose obligations are unconditionally guaranteed by
an entity having, long-term senior unsecured debt that is rated no less than
Baa2 by Moody’s and BBB by S&P on the date the relevant transaction is
entered into by the Borrower or such Subsidiary.

 

“Funding Office”:  the office of the Administrative Agent
specified in Section 11.2 or such other office as may be specified from
time to time by the Administrative Agent as its funding office by written
notice to the Borrower and the Lenders.

 

“GAAP”:  those accounting principles, standards and
practices generally accepted in the United States as in effect on the date
hereof.

 

“Governmental Authority”:  any nation or government, any state or other
political subdivision thereof, any agency, authority, instrumentality,
regulatory body, court, central bank

 

17

 

or other entity exercising executive, legislative, judicial, taxing,
regulatory or administrative functions of or pertaining to government, any
securities exchange and any self-regulatory organization (including the
National Association of Insurance Commissioners).

 

“Group Members”:  the collective reference to the Borrower and
its Restricted Subsidiaries.

 

“Guarantee and Collateral Agreement”:  the Guarantee and Collateral Agreement to be
executed and delivered by the Borrower and each Subsidiary Guarantor,
substantially in the form of Exhibit A.

 

“Guarantee Obligation”:  as to any Person (the “guaranteeing person”),
any obligation, including a reimbursement, counterindemnity or similar
obligation, of the guaranteeing Person that guarantees or in effect guarantees,
or which is given to induce the creation of a separate obligation by another
Person (including any bank under any letter of credit) that guarantees or in
effect guarantees, any Debt, leases, dividends or other obligations (the “primary
obligations”) of any other third Person (the “primary obligor”) in
any manner, whether directly or indirectly, including any obligation of the
guaranteeing person, whether or not contingent, (i) to purchase any such
primary obligation or any property constituting direct or indirect security
therefor, (ii) to advance or supply funds (1) for the purchase or
payment of any such primary obligation or (2) to maintain working capital
or equity capital of the primary obligor or otherwise to maintain the net worth
or solvency of the primary obligor or (iii) otherwise to assure or hold
harmless the owner of any such primary obligation against loss in respect
thereof; provided, however, that the term Guarantee Obligation
shall not include endorsements of instruments for deposit or collection in the
ordinary course of business. The amount of any Guarantee Obligation of any
guaranteeing person shall be deemed to be the lower of (a) an amount equal
to the stated or determinable amount of the primary obligation in respect of
which such Guarantee Obligation is made and (b) the maximum amount for
which such guaranteeing person may be liable pursuant to the terms of the
instrument embodying such Guarantee Obligation, unless such primary obligation
and the maximum amount for which such guaranteeing person may be liable are not
stated or determinable, in which case the amount of such Guarantee Obligation
shall be such guaranteeing person’s maximum reasonably anticipated liability in
respect thereof as determined by the Borrower in good faith.

 

“Hedging Arrangement”:  any Swap Agreement in respect of interest
rates or currency exchange rates entered into by any Loan Party and the
Administrative Agent or any Person which at the time such Swap Agreement is
entered into is a Lender or Affiliate thereof.

 

“Intercreditor Agreement”:  any intercreditor agreement in the form of Exhibit I
or Exhibit K hereto, as applicable, or otherwise on terms reasonably
satisfactory to the Administrative Agent, entered into pursuant hereto in
respect of (i) Permitted Pari Passu Debt or (ii) junior Liens
permitted under Section 8.3(i)(x).

 

“Interest Coverage Ratio”:  for any period, the ratio of (a) EBITDA
for such period to (b) Corporate Interest for such period.

 

18

 

“Interest Payment Date”:  (a) as to any ABR Loan (other than any
Swingline Loan), the last day of each March, June, September and December to
occur while such Loan is outstanding and the final maturity date of such Loan, (b) as
to any Eurodollar Loan having an Interest Period of three months or less, the
last day of such Interest Period, (c) as to any Eurodollar Loan having an
Interest Period longer than three months, each day that is three months, or a
whole multiple thereof, after the first day of such Interest Period and the
last day of such Interest Period, (d) as to any Loan (other than any
Revolving Loan that is an ABR Loan and any Swingline Loan), the date of any
repayment or prepayment made in respect thereof and (e) as to any
Swingline Loan, the day that such Loan is required to be repaid.

 

“Interest Period”:  as to any Eurodollar Loan, (a) initially,
the period commencing on the borrowing or conversion date, as the case may be,
with respect to such Eurodollar Loan and ending one, two, three or six months
thereafter (or such other period as the Borrower and all Lenders of the
relevant Facility may agree), as selected by the Borrower in its notice of
borrowing or notice of conversion, as the case may be, given with respect
thereto; and (b) thereafter, each period commencing on the last day of the
next preceding Interest Period applicable to such Eurodollar Loan and ending
one, two, three or six months (or such other period as the Borrower and all
Lenders of the relevant Facility may agree) thereafter, as selected by the
Borrower by irrevocable notice to the Administrative Agent not later than 11:00 A.M.,
New York City time, on the date that is three Business Days prior to the last
day of the then current Interest Period with respect thereto; provided
that, all of the foregoing provisions relating to Interest Periods are subject
to the following:

 

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

 

(ii)                                  the
Borrower may not select an Interest Period under a particular Facility that
would extend beyond, with respect to Revolving Loans, the Revolving Termination
Date or, with respect to Term Loans, beyond the date final payment is due on
the Term Loans, as the case may be; and

 

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

 

“Investments”:  as defined in Section 8.6.

 

“Issuing Lenders”: collectively, the
Revolving Issuing Lenders and the Synthetic Issuing Lender.

 

“JPMCB”: as defined in the preamble
hereto.

 

19

 

“Lenders”:  as defined in the preamble hereto; provided,
that unless the context otherwise requires, each reference herein to the
Lenders shall be deemed to include any Conduit Lender.

 

“Letters of Credit”:  collectively, the Revolving Letters of Credit
and the Synthetic Letters of Credit.

 

“Leverage Ratio”:  as at the last day of any period, the ratio
of (a) Net Debt on such day to (b) EBITDA for such period.

 

“Lien”:  any mortgage, pledge, lien, hypothecation,
security interest or other charge, encumbrance or other arrangement in the
nature of a security interest in property; provided, however,
that the term “Lien” shall not mean any easements, rights-of-way, zoning
restrictions, encroachments, minor title deficiencies, leases, subleases,
licenses, sublicenses, or other restrictions on the use of property or other
similar encumbrances.

 

“Loan”:  any loan made by any Lender pursuant to this
Agreement.

 

“Loan Documents”:  this Agreement, the Security Documents, the
Notes and any amendment, waiver, supplement or other modification to any of the
foregoing.

 

“Loan Parties”:  the Borrower and each of its Subsidiaries
that is a party to a Loan Document.

 

“MAG”: 
Mirant Americas Generation, LLC, a Delaware limited liability company.

 

“MAG Interest Distribution”: for any
period, the aggregate amount of cash the Borrower paid or otherwise distributed
to MAG during such period that MAG applied during such period to the payment of
accrued interest on the MAG Senior Notes that was due and payable during such
period.

 

“MAG Senior Notes”:  the following series of notes issued by MAG:
the $850,000,000 of Senior Notes due 2011, the $450,000,000 of Senior Notes due
2021, and the $400,000,000 of Senior Notes due 2031.

 

“MAI Series A Preferred Shares”:  as defined in the Plan of Reorganization.

 

“MAI Series B Preferred Shares”:  as defined in the Plan of Reorganization.

 

“Majority Facility Lenders”:  with respect to any Facility, the holders of
more than 50% of the aggregate unpaid principal amount of the Term Loans or the
Total Revolving Extensions of Credit, as the case may be, outstanding under
such Facility (or, in the case of the Revolving Facility, prior to any
termination of the Revolving Commitments, the holders of more than 50% of the
Total Revolving Commitments).

 

“Majority Lenders”:  at any time, the holders of more than 50% of (a) until
the Closing Date, the Commitments then in effect and (b) thereafter, the
sum of (i) the aggregate

 

20

 

unpaid principal amount of the Term Loans then outstanding and (ii) the
Total Revolving Commitments then in effect or, if the Revolving Commitments
have been terminated, the Total Revolving Extensions of Credit then
outstanding.

 

“Material Adverse Effect”:  a material adverse change in, or material
adverse effect on, (i) the financial condition, operations, business or
Assets of the Borrower or its Subsidiaries, which would have a material adverse
effect on the ability of the Borrower to pay amounts owed by it from time to
time hereunder, or (ii) the validity or enforceability of this Agreement
or any of the other Loan Documents against the Borrower or any Subsidiary
Guarantor which would have a material adverse effect on the rights, remedies
and benefits available to, or conferred upon, the Administrative Agent or the
Lenders, taken as a whole.

 

“MET”: Mirant Energy Trading, LLC, a
Delaware limited liability company.

 

“MIRMA”:  Mirant Mid-Atlantic, LLC, a Delaware limited
liability company.

 

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

 

“Moody’s Rating”: at any time, the
rating issued by Moody’s and then in effect with respect to a Person’s senior
unsecured long-term debt securities without third party credit enhancement.

 

“Mortgaged Properties”:  the real properties listed on Schedule 1.1B
and designated as properties for which a Mortgage will be delivered and any
real property with respect to which a Mortgage is granted pursuant to Section 6.7(b).

 

“Mortgages”:  each of the mortgages and deeds of trust made
by any Loan Party in favor of, or for the benefit of, the Administrative Agent
for the benefit of the Lenders, substantially in the form of Exhibit D
(with such changes thereto as shall be advisable under the law of the
jurisdiction in which such mortgage or deed of trust is to be recorded).

 

“Net Cash Proceeds”:  (a) in connection with any Asset Sale or
any Recovery Event, the proceeds thereof in the form of cash and Cash Equivalents
(including any such proceeds received by way of deferred payment of principal
pursuant to a note or installment receivable or purchase price adjustment
receivable or otherwise, but only as and when received), net of attorneys’
fees, accountants’ fees, investment banking fees, amounts required to be
applied to the repayment of Debt secured by a Lien expressly permitted
hereunder on any asset that is the subject of such Asset Sale or Recovery Event
(other than any Lien pursuant to a Security Document) and other customary fees
and expenses actually incurred in connection therewith and net of taxes paid or
reasonably estimated to be payable as a result thereof (after taking into
account any available tax credits or deductions and any tax sharing arrangements)
and (b) in connection with any issuance or sale of Capital Stock or any
incurrence of Debt, the cash proceeds received from such issuance or
incurrence, net of attorneys’ fees, investment banking fees, accountants’ fees,
underwriting discounts and commissions and other customary fees and expenses
actually incurred in connection therewith.

 

“Net Debt”:  at any time, the aggregate principal amount
of Debt of the Borrower and its Subsidiaries at such time outstanding less
(i) cash and deposits restricted pursuant to

 

21

 

agreements with a Person other than an Affiliate of the Borrower, and (ii) broker,
counterparty, and customer margin/collateral assets and deposits advanced to or
held on behalf of such broker, counterparty or customer, as each of the
foregoing items described in clauses (i) and (ii) appears on the
consolidated balance sheet of the Borrower and its Subsidiaries, as either
restricted deposits or deposits with brokers and in any event shall include the
Synthetic L/C Deposit.

 

“New Mirant”: Mirant Corporation
(formerly known as Newco 2005 Corporation), a Delaware corporation.

 

“Non-Excluded Taxes”:  as defined in Section 2.19(a).

 

“Non-U.S. Lender”:  as defined in Section 2.19(d).

 

“Notes”:  the collective reference to any promissory
note evidencing Loans.

 

“Obligations”:  the unpaid principal of and interest on
(including interest accruing after the maturity of the Loans and Reimbursement
Obligations and interest accruing after the filing of any petition in
bankruptcy, or the commencement of any insolvency, reorganization or like
proceeding, relating to the Borrower, whether or not a claim for post-filing or
post-petition interest is allowed in such proceeding) the Loans and all other
obligations and liabilities of the Borrower to the Administrative Agent or to
any Lender (or, in the case of Hedging Arrangements or Specified Cash
Management Programs, any affiliate of any Lender or any other Person which, at
the time any such Hedging Arrangement was entered into, was a Lender or an
affiliate thereof), whether direct or indirect, absolute or contingent, due or
to become due, or now existing or hereafter incurred, which may arise under,
out of, or in connection with, this Agreement, any other Loan Document, the
Letters of Credit, any Hedging Arrangement, any Specified Cash Management
Program or any other document made, delivered or given in connection herewith
or therewith, whether on account of principal, interest, reimbursement
obligations, fees, indemnities, costs, expenses (including all fees, charges
and disbursements of counsel to the Administrative Agent or to any Lender that
are required to be paid by the Borrower pursuant hereto) or otherwise.

 

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

 

“Participant”:  as defined in Section 11.6(c).

 

“Permitted Debt”: (i) the Loans
and other obligations of any Loan Party under any Loan Document and Debt
outstanding on the date hereof and listed on Schedule 1.1C (which may be
secured to the extent currently secured on the date hereof); (ii) Permitted
Pari Passu Debt; (iii) Subordinated Debt; (iv) Project Finance Debt
and Debt secured by Liens permitted pursuant to clauses (f) and (g) of
Section 8.3; (v) Debt incurred (x) to finance Environmental Capital
Expenditures and other capital expenditures made to comply with Requirements of
Law and (y) with respect to MIRMA and its Subsidiaries, to finance Required
Improvements (as such term is used in the Facility Lease Documents), which Debt
may be secured by the capital assets or Required Improvements and related
assets financed by such Debt; and (vi) refinancings or

 

22

 

renewals of the Debt permitted to be incurred pursuant to the terms
hereof (which may be secured by the same assets as the refinanced or renewed
Debt); provided, that any such refinancing or renewal of Debt is (x)
either in an amount not in excess of the principal amount outstanding or
committed under the Debt being refinanced or renewed immediately prior to such
refinancing (plus any applicable fees or expenses and redemption or repurchase
premiums or penalties) or renewal, or such excess amount can otherwise be
incurred hereunder, and (y) provides for a final maturity date no earlier than
the existing scheduled maturity date of the Debt being refinanced or renewed.

 

“Permitted Pari Passu Debt”: Debt of
the Borrower or any Subsidiary Guarantor not to exceed $250,000,000 in the
aggregate that is pari  passu, including with respect to the
Collateral, with the Obligations (as defined in the Guarantee and Collateral
Agreement) pursuant to a security agreement in form and substance satisfactory
to the Administrative Agent and an intercreditor agreement in the form of Exhibit K
or otherwise on terms reasonably satisfactory to the Administrative Agent.

 

“Person”:  an individual, company, corporation, firm,
partnership, joint venture, undertaking, association, organization, trust,
state or agency of a state or limited liability company (in each case whether
or not having separate legal personality).

 

“Plan”:  any plan described in Section 3(2) of
ERISA that is subject to Title IV of ERISA, maintained or contributed to by the
Borrower or any ERISA Affiliate.

 

“Plan of Reorganization”: the Amended
and Restated Second Amended Joint Chapter 11 Plan of Reorganization for Mirant
Corporation and its Affiliated Debtors, dated December 9, 2005, In re
Mirant Corporation, et al., Debtors, as amended, modified or waived either (x)
with the consent of the Administrative Agent, such consent not to be
unreasonably withheld or (y) as would not reasonably be expected to have a
Material Adverse Effect.

 

“Plan Secured Note”: as defined in the
Plan of Reorganization.

 

“PPA”: 
(a) an arms-length, executed, valid and binding agreement
(including, without limitation, a tolling agreement) that is then in full force
and effect and not in default in any material respect and which is not
terminable without cause between the Borrower or any Subsidiary and either:

 

(i)                                     a
third party purchaser whose, or whose obligations are unconditionally
guaranteed by an entity whose, long-term senior unsecured debt is rated no less
than Baa3 by Moody’s and BBB- by S&P on the date the relevant transaction
is entered into by the Borrower or such Subsidiary; or

 

(ii)                                  an
Affiliate of the Borrower, so long as such Affiliate has executed a valid and
binding agreement with a third party purchaser whose, or whose obligations are
unconditionally guaranteed by an entity whose, long-term senior unsecured debt
is rated no less than Baa3 by Moody’s and BBB- by S&P on the date the
relevant transaction is entered into by the Borrower or such Subsidiary with
substantially the same terms (other than any pricing spread) as the Affiliate’s
agreement with the Borrower or such Subsidiary;

 

23

 

in each case, for the sale of electric energy or capacity (in the case
of both energy and capacity, on a take or pay, take and pay, or take, if
tendered basis) at prices established at a formula, index or other price risk
management methodology not based on spot market prices by the Borrower or such
Subsidiary to the third party or Affiliate; or

 

(b)                                 financial hedge
agreements relating to energy or capacity pricing that are:

 

(i)                                     fully
supported by available energy or capacity of the Borrower and its Subsidiaries;
and

 

(ii)                                  with
counterparties having, or whose obligations are unconditionally guaranteed by
an entity having, long-term senior unsecured debt that is rated no less than
Baa2 by Moody’s and BBB by S&P on the date the relevant transaction is
entered into by the Borrower or such Subsidiary.

 

“Pricing Grid”:  the table set forth below.

 

	
  Leverage Ratio

  	
   

  	
  Applicable Margin

  for Revolving Loans

  that are Eurodollar

  Loans

  	
   

  	
  Applicable Margin

  for Revolving Loans

  that are ABR Loans

  	
   

  	
  Commitment Fee Rate

  	
   

  
	
  > 2.5 to
  1.0

  	
   

  	
  2.25

  	
  %

  	
  1.25

  	
  %

  	
  0.375

  	
  %

  
	
  <
  2.5 to 1.0 and

  > 2.0 to 1.0

  	
   

  	
  2.00

  	
  %

  	
  1.00

  	
  %

  	
  0.375

  	
  %

  
	
  <
  2.0 to 1.0

  	
   

  	
  1.75

  	
  %

  	
  0.75

  	
   

  	
  0.250

  	
  %

  

 

For the purposes of the Pricing Grid, changes
in the Applicable Margin for Revolving Loans resulting from changes in the
Leverage Ratio shall become effective on the date (the “Adjustment Date”)
that is three Business Days after the date on which financial statements are
delivered to the Lenders pursuant to Section 6.2 and shall remain in
effect until the next change to be effected pursuant to this paragraph. If any
financial statements referred to above are not delivered within the time
periods specified in Section 6.2, then, from the latest date on which such
financial statements are required to be delivered until the date that is three
Business Days after the date on which such financial statements are delivered,
the highest rate set forth in each column of the Pricing Grid shall apply. Each
determination of the Leverage Ratio pursuant to the Pricing Grid shall be made
in a manner consistent with the determination thereof pursuant to Section 7.2.

 

“Project Finance Debt”:  Debt (not exceeding the cost of the
acquisition, construction or creation of the relevant Asset or project) of any
Subsidiary incurred or existing in connection with the financing or refinancing
of any Asset or project, the repayment of which Debt is to be made from the
revenues arising out of, or other proceeds of realization from, the acquired or
created Asset or project, with recourse to those revenues and proceeds and
Assets forming the subject matter of such Asset or project (including, without
limitation, insurance, contracts and Capital Stock or other rights of ownership
in the entity(ies) which own the relevant

 

24

 

Assets or project) and other Assets ancillary thereto but without
substantial recourse to any other Asset or otherwise to the Borrower or a
Restricted Subsidiary; provided that substantial recourse shall not be deemed
to exist by reason of normal and customary sponsor support arrangements.

 

“Projections”:  as defined in Section 6.3(c).

 

“Recovery Event”:  any settlement of or payment in respect of
any property or casualty insurance claim or any condemnation proceeding
relating to any asset of any Group Member.

 

“Refunded Swingline Loans”:  as defined in Section 2.7(b).

 

“Register”:  as defined in Section 11.6(b).

 

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

 

“Reimbursement Obligation”:  the obligation of the Borrower to reimburse
any Issuing Lender pursuant to Section 3.5 or Section 3.10 for
amounts drawn under Letters of Credit.

 

“Reinvestment Commitment Notice” a
written notice executed by a Responsible Officer on or prior to the date
falling 365 days after an Asset Sale or Recovery Event, stating (x) that, in
the case of an Asset Sale only, no Event of Default has occurred and is
continuing and (y) that the Borrower (directly or through a Restricted
Subsidiary) has committed to use all or a specified portion of the Net Cash
Proceeds of (i) an Asset Sale within 180 days after the date of such
notice or (ii) a Recovery Event within 24 months after the date of such
notice to acquire or repair assets useful in its business.

 

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

 

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

 

“Requirement of Law”:  as to any Person, any law, treaty, rule or
regulation or determination of an arbitrator or a court or other Governmental
Authority, in each case applicable to or binding upon such Person or any of its
property or to which such Person or any of its property is subject.

 

“Responsible Officer”:  the chief executive officer, president, chief
financial officer treasurer or controller of the Borrower.

 

“Restricted Payment”:  as defined in Section 8.2.

 

25

 

“Restricted Subsidiaries”:  all Subsidiaries of the Borrower other than
Unrestricted Subsidiaries.

 

“Revolving Commitment”:  as to any Lender, the obligation of such
Lender, if any, to make Revolving Loans and participate in Swingline Loans and
Revolving Letters of Credit in an aggregate principal and/or face amount not to
exceed the amount set forth under the heading “Revolving Commitment” opposite
such Lender’s name on Schedule 1.1A or in the Assignment and Assumption
pursuant to which such Lender became a party hereto, as the same may be changed
from time to time pursuant to the terms hereof.

 

“Revolving Commitment Period”:  the period from and including the Closing
Date to the Revolving Termination Date.

 

“Revolving Extensions of Credit”:  as to any Revolving Lender at any time, an
amount equal to the sum of (a) the aggregate principal amount of all
Revolving Loans held by such Lender then outstanding, (b) such Lender’s
Revolving Percentage of the Revolving L/C Obligations then outstanding and (c) such
Lender’s Revolving Percentage of the aggregate principal amount of Swingline
Loans then outstanding.

 

“Revolving Issuing Lender”:  any of JPMCB, DBTCA and any other Revolving
Lender from time to time designated by the Borrower as a Revolving Issuing
Lender with the consent of such other Revolving Lender and the Administrative
Agent, or any Affiliate thereof, in its capacity as issuer of any Revolving
Letter of Credit; collectively, the “Revolving Issuing Lenders”.

 

“Revolving L/C Commitment”:  $800,000,000.

 

“Revolving L/C Obligations”:  at any time, an amount equal to the sum of (a) the
aggregate then undrawn and unexpired amount of the then outstanding Revolving
Letters of Credit and (b) the aggregate amount of drawings under Revolving
Letters of Credit that have not then been reimbursed pursuant to Section 3.5.

 

“Revolving L/C Participants”:  as to any Revolving Letter of Credit, the
collective reference to all the Revolving Lenders other than the Revolving
Issuing Lender of such Letter of Credit.

 

“Revolving Lender”:  each Lender that has a Revolving Commitment
or that holds Revolving Loans.

 

“Revolving Letters of Credit”:  as defined in Section 3.1(a).

 

“Revolving Loans”:  as defined in Section 2.4(a).

 

“Revolving Percentage”:  as to any Revolving Lender at any time, the
percentage which such Lender’s Revolving Commitment then constitutes of the Total
Revolving Commitments or, at any time after the Revolving Commitments shall
have expired or terminated, the percentage which the aggregate principal amount
of such Lender’s Revolving Loans then

 

26

 

outstanding constitutes of the aggregate principal amount of the
Revolving Loans then outstanding, provided, that, in the event that the
Revolving Loans are paid in full prior to the reduction to zero of the Total
Revolving Extensions of Credit, the Revolving Percentages shall be determined
in a manner designed to ensure that the other outstanding Revolving Extensions
of Credit shall be held by the Revolving Lenders on a comparable basis.

 

“Revolving Termination Date”:  the sixth anniversary of the Closing Date.

 

“S&P”:  Standard & Poor’s Ratings Services,
a division of the McGraw Hill Companies, Inc., or any successor thereto.

 

“S&P Rating”: at any time, the
rating issued by S&P and then in effect with respect to a Person’s senior
unsecured long-term debt securities without third party credit enhancement.

 

“SEC”: 
the Securities and Exchange Commission, any successor thereto and any
analogous Governmental Authority.

 

“Security Documents”:  the collective reference to the Guarantee and
Collateral Agreement, the Mortgages, any Intercreditor Agreements, the
Synthetic L/C Deposit Agreement and all other security documents hereafter
delivered to the Administrative Agent granting a Lien on any property of any
Person to secure the obligations and liabilities of any Loan Party under any
Loan Document.

 

“Specified Cash Management Program”:  any cash management arrangement between the
Borrower and any Lender or any Affiliate thereof (to the extent designated by
the Borrower).

 

“Specified Issuing Lender Commitment”:
with respect to JPMCB, its commitment to act as Revolving Issuing Lender for up
to $300,000,000 of the Revolving L/C Commitment; with respect to DBTCA, its
commitment to act as Revolving Issuing Lender for up to $250,000,000 of the
Revolving L/C Commitment; and with respect to any other Revolving Issuing
Lender, its commitment to act as Revolving Issuing Lender for up to a
percentage of the Revolving L/C Commitment agreed by the Borrower and such
Revolving Issuing Lender.

 

“Step-In Rights”: Liens in favor of
counterparties to any PPA (other than Affiliates of the Borrower) that create
rights the exercise of which are limited to the taking of actions pursuant to
any provisions of such PPA designed to enable the counterparty to assume
operational control of the relevant facility or facilities (e.g., step-in
rights) or otherwise necessary to continue performance of the Borrower’s or the
applicable Subsidiary’s obligations under such PPA.

 

“Subordinated Debt”:  unsecured Debt of the Borrower and/or any
Subsidiary Guarantor that is subordinated and junior in right of payment to the
Obligations (as defined in the Guarantee and Collateral Agreement) and is
issued solely for cash proceeds where either (i) the subordination
provisions of such Debt shall be at least as favorable to the Lenders as the
subordination provisions set forth in Schedule 8.1 or (ii) the
subordination provisions shall be in all respects reasonably satisfactory to
the Administrative Agent.

 

27

 

“Subsidiary”:  as to any Person, any corporation,
partnership, joint venture, limited liability company, trust or estate of which
(or in which) more than 50% of (a) the voting stock, (b) the interest
in the capital or profits of such limited liability company, partnership or
joint venture or (c) the beneficial interest in such trust or estate is at
the time directly or indirectly owned or controlled by such Person, by such
Person and one or more of its Subsidiaries or by one or more of such Person’s
other Subsidiaries. Unless otherwise qualified, all references to a “Subsidiary”
or to “Subsidiaries” in this Agreement shall refer to a Subsidiary or
Subsidiaries of the Borrower.

 

“Subsidiary Guarantor”:  each Restricted Subsidiary of the Borrower
other than (a) any Excluded Foreign Subsidiary, (b) MET and any
Subsidiaries of MET, (c) MIRMA and any Subsidiaries of MIRMA and (d) New
MAEM Holdco, LLC and any Subsidiaries of New MAEM Holdco, LLC, which the
Borrower shall Dispose of within 60 days after the Closing Date in accordance
with the Plan of Reorganization.

 

 “Swap
Agreement”:  any agreement, including
any Hedging Arrangement, with respect to any swap, forward, future or
derivative transaction or option or similar agreement involving, or settled by
reference to, one or more rates, currencies, commodities, equity or debt
instruments or securities, or economic, financial or pricing indices or
measures of economic, financial or pricing risk or value or any similar
transaction or any combination of these transactions; provided that no
phantom stock or similar plan providing for payments only on account of
services provided by current or former directors, officers, employees or
consultants of the Borrower or any of its Subsidiaries shall be a “Swap
Agreement”.

 

“Swingline Commitment”:  the obligation of the Swingline Lender to
make Swingline Loans pursuant to Section 2.6 in an aggregate principal
amount at any one time outstanding not to exceed $25,000,000.

 

“Swingline Lender”:  JPMCB, in its capacity as the lender of
Swingline Loans.

 

“Swingline Loans”:  as defined in Section 2.6.

 

“Swingline Participation Amount”:  as defined in Section 2.7.

 

“Synthetic Issuing Lender”:  JPMCB or any Affiliate thereof, in its
capacity as issuer of any Synthetic Letter of Credit.

 

“Synthetic L/C Deposit”:  at any time, the amounts then actually on
deposit in the Synthetic L/C Deposit Account.

 

“Synthetic L/C Deposit Account”:  the account established by the Borrower in
the name of the Synthetic Issuing Lender pursuant to Section 3.8.

 

“Synthetic L/C Deposit Agreement”:  as defined in Section 3.8(a).

 

“Synthetic L/C Termination Date”:  the seventh anniversary of the Closing Date.

 

28

 

“Synthetic Letter of Credit Outstandings”:  at any time, the sum of (i) the
aggregate undrawn stated amount of all Synthetic Letters of Credit issued then
outstanding at such time and plus (ii) the aggregate amount of
drawings under Synthetic Letters of Credit that have not then been reimbursed
pursuant to Section 3.10.

 

“Synthetic Letters of Credit”:  as defined in Section 3.6.

 

“Term Commitment”:  as to any Lender, the obligation of such
Lender, if any, to make a Term Loan to the Borrower on the Closing Date in a
principal amount not to exceed the amount set forth under the heading “Term
Commitment” opposite such Lender’s name on Schedule 1.1A. The aggregate
amount of the Term Commitments is $700,000,000.

 

“Term Lender”:  each Lender that has a Term Commitment or
that holds a Term Loan.

 

“Term Loans”:  as defined in Section 2.1.

 

“Term Percentage”:  as to any Term Lender at any time, the
percentage which such Lender’s Term Commitment then constitutes of the
aggregate Term Commitments (or, at any time after the Closing Date, the
percentage which the aggregate principal amount of such Lender’s Term Loans
then outstanding constitutes of the aggregate principal amount of the Term
Loans then outstanding).

 

“Total Revolving Commitments”:  at any time, the aggregate amount of the
Revolving Commitments then in effect. The original amount of the Total
Revolving Commitments is $800,000,000.

 

“Total Revolving Extensions of Credit”:  at any time, the aggregate amount of the
Revolving Extensions of Credit of the Revolving Lenders outstanding at such
time.

 

“Transferee”:  any Assignee or Participant.

 

“Type”:  as to any Loan, its nature as an ABR Loan or
a Eurodollar Loan.

 

“United States”:  the United States of America.

 

“Unrestricted Subsidiaries”:  (a) until such time as such entities
emerge from the Chapter 11 Cases, Mirant New York, Inc., Mirant Lovett,
LLC, Mirant Bowline, LLC, Mirant NY-Gen, LLC and Hudson Valley Gas Corporation
and (b) any Subsidiary of the Borrower that is designated by the Board of
Directors of the Borrower as an Unrestricted Subsidiary, but only to the extent
that such Subsidiary (i) has no Assets other than Assets acquired after,
or immaterial or unproductive Assets owned prior to, the date of this
Agreement, (ii) has no Debt other than Debt that is non-recourse to the
Borrower or the Restricted Subsidiaries, (iii) is not party to any
agreement or contract with the Borrower or a Restricted Subsidiary unless the
terms of such agreement are no less favorable to the Borrower or such
Restricted Subsidiary than those that might be obtained from an unaffiliated
third-party, and (iv) is a Person with respect to which neither the
Borrower nor any Restricted Subsidiary has any direct or indirect obligation to
make capital contributions or to maintain such Subsidiary’s financial
condition.

 

29

 

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

 

(b)                                 As used herein and in the other Loan
Documents, and any certificate or other document made or delivered pursuant
hereto or thereto, (i) accounting terms relating to any Group Member not
defined in Section 1.1 and accounting terms partly defined in Section 1.1,
to the extent not defined, shall have the respective meanings given to them
under GAAP, (ii) the words “include”, “includes” and “including” shall be
deemed to be followed by the phrase “without limitation”, (iii) the word “incur”
shall be construed to mean incur, create, issue, assume, become liable in
respect of or suffer to exist (and the words “incurred” and “incurrence” shall
have correlative meanings), (iv) the words “asset” and “property” shall be
construed to have the same meaning and effect and to refer to any and all
tangible and intangible assets and properties, including cash, Capital Stock,
securities, revenues, accounts, leasehold interests and contract rights, and (v) references
to agreements or other Contractual Obligations shall, unless otherwise
specified, be deemed to refer to such agreements or Contractual Obligations as
amended, supplemented, restated or otherwise modified from time to time.

 

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

 

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

 

SECTION 2.  AMOUNT
AND TERMS OF COMMITMENTS

 

2.1.                              Term Commitments. 
Subject to the terms and conditions hereof, each Term Lender severally
agrees to make a term loan (a “Term Loan”) to the Borrower on the
Closing Date in an amount not to exceed the amount of the Term Commitment of
such Lender.  The Term Loans may from
time to time be Eurodollar Loans or ABR Loans, as determined by the Borrower and
notified to the Administrative Agent in accordance with Sections 2.2
and 2.12.

 

2.2.                              Procedure for Term
Loan Borrowing.  The Borrower shall give the Administrative
Agent irrevocable notice (which notice must be received by the Administrative
Agent prior to 10:00 A.M., New York City time, one Business Day prior to
the anticipated Closing Date) requesting that the Term Lenders make the Term
Loans on the Closing Date and specifying the amount to be borrowed.  The Term Loans made on the Closing Date shall
initially be ABR Loans and, unless otherwise agreed by the Administrative Agent
in its sole discretion, no Term Loan may be converted into or continued as a
Eurodollar Loan having an Interest Period in excess of one month prior to the
earlier of (i) the date the Administrative Agent determines that the
primary syndication of Term Loans has been completed or (ii) the date that
is 30 days after the Closing Date.  Upon
receipt of such notice the Administrative Agent shall promptly notify each Term
Lender thereof.  Not later than 12:00
Noon, New York City time, on the Closing Date each Term Lender shall make
available to the Administrative Agent at the Funding Office an amount in
immediately available funds equal to the Term Loan or Term

 

30

 

Loans
to be made by such Lender.  The
Administrative Agent shall credit the account of the Borrower on the books of
such office of the Administrative Agent with the aggregate of the amounts made
available to the Administrative Agent by the Term Lenders in immediately
available funds.

 

2.3.                              Repayment of Term
Loans.  The principal amount of the Term Loan of each
Term Lender shall mature in 28 consecutive installments (each due on the last
day of each calendar quarter, except for the last such installment), commencing
on March 31, 2006, each of which shall be in an amount equal to such
Lender’s Term Percentage multiplied by (i) in the case of the first 27
such installments, $1,750,000 and (ii) in the case of the last such
installment (which shall be due on the seventh anniversary of the Closing
Date), the remaining aggregate principal amount of the Term Loans.

 

2.4.                              Revolving Commitments.  (a) 
Subject to the terms and conditions hereof, each Revolving Lender severally
agrees to make revolving credit loans (“Revolving Loans”) to the
Borrower from time to time during the Revolving Commitment Period in an
aggregate principal amount at any one time outstanding which, when added to
such Lender’s Revolving Percentage of the sum of (i) the Revolving L/C
Obligations then outstanding and (ii) the aggregate principal amount of
the Swingline Loans then outstanding, does not exceed the amount of such Lender’s
Revolving Commitment.  During the
Revolving Commitment Period the Borrower may use the Revolving Commitments by
borrowing, prepaying the Revolving Loans in whole or in part, and reborrowing,
all in accordance with the terms and conditions hereof.  The Revolving Loans may from time to time be
Eurodollar Loans or ABR Loans, as determined by the Borrower and notified to
the Administrative Agent in accordance with Sections 2.5 and 2.12.

 

(b)                                 The Borrower shall repay all outstanding
Revolving Loans on the Revolving Termination Date.

 

2.5.                              Procedure for
Revolving Loan Borrowing.  (a)  The Borrower may borrow under the
Revolving Commitments during the Revolving Commitment Period on any Business
Day, provided that the Borrower shall give the Administrative Agent irrevocable
notice (which notice must be received by the Administrative Agent (i) prior
to 11:00 A.M., New York City time, three Business Days prior to the
requested Borrowing Date, in the case of Eurodollar Loans, or (ii) prior
to 10:00 A.M., New York City time on the requested Borrowing Date, in the
case of ABR Loans (including for purposes of financing payments required by Section 3.5),
specifying (A) the amount and Type of Revolving Loans to be borrowed, (B) the
requested Borrowing Date and (C) in the case of Eurodollar Loans, the
respective amounts of each such Type of Loan and the respective lengths of the
initial Interest Period therefor.  Any
Revolving Loans made on the Closing Date shall initially be ABR Loans.  Each borrowing under the Revolving
Commitments shall be in an amount equal to (x) in the case of ABR Loans,
$1,000,000 or a whole multiple thereof (or, if the then aggregate Available
Revolving Commitments are less than $1,000,000, such lesser amount) and (y) in
the case of Eurodollar Loans, $5,000,000 or a whole multiple of $1,000,000 in
excess thereof; provided, that the Swingline Lender may request, on behalf of
the Borrower, borrowings under the Revolving Commitments that are ABR Loans in
other amounts pursuant to Section 2.7. 
Upon receipt of any such notice from the Borrower, the Administrative
Agent shall promptly notify each Revolving Lender thereof.  Each Revolving Lender will make the amount of
its pro rata share of

 

31

 

each
borrowing available to the Administrative Agent for the account of the Borrower
at the Funding Office prior to 12:00 Noon, New York City time, on the Borrowing
Date requested by the Borrower in funds immediately available to the
Administrative Agent.  Such borrowing
will then be made available to the Borrower by the Administrative Agent
crediting the account of the Borrower on the books of such office with the
aggregate of the amounts made available to the Administrative Agent by the
Revolving Lenders and in like funds as received by the Administrative Agent.

 

(b)                                 In the event that the Borrower fails to reimburse
any Revolving Issuing Lender in accordance with Section 3.5 for the amount
of any draft paid by such Revolving Issuing Lender under any Revolving Letter
of Credit issued by it, and for all other amounts due in connection therewith
pursuant to Section 3.5 (the “Reimbursement Payment”), then on the
date that the Reimbursement Payment is due, the Borrower shall be deemed to
have made a request for a borrowing of ABR Loans in an amount equal to the
Reimbursement Payment, which deemed request shall not be subject to any
condition precedent set forth in Section 5.2 and shall be
irrevocable.  Each Revolving Lender
acknowledges and agrees that its obligation to make its pro rata share of any
such borrowing available to the Administrative Agent is absolute and
unconditional and shall not be affected by any event, happening or circumstance
whatsoever, including the failure of any condition precedent set forth in Section 5
to be satisfied at the time of such deemed request.

 

2.6.                              Swingline Commitment.  (a) 
Subject to the terms and conditions hereof, the Swingline Lender agrees to make
a portion of the credit otherwise available to the Borrower under the Revolving
Commitments from time to time during the Revolving Commitment Period by making
swing line loans (“Swingline Loans”) to the Borrower; provided
that (i) the aggregate principal amount of Swingline Loans outstanding at
any time shall not exceed the Swingline Commitment then in effect
(notwithstanding that the Swingline Loans outstanding at any time, when aggregated
with the Swingline Lender’s other outstanding Revolving Loans, may exceed the
Swingline Commitment then in effect) and (ii) the Borrower shall not
request, and the Swingline Lender shall not make, any Swingline Loan if, after
giving effect to the making of such Swingline Loan, the aggregate amount of the
Available Revolving Commitments would be less than zero.  During the Revolving Commitment Period, the
Borrower may use the Swingline Commitment by borrowing, repaying and
reborrowing, all in accordance with the terms and conditions hereof.  Swingline Loans shall be ABR Loans only.

 

(b)                                 The Borrower shall repay to the Swingline
Lender the then unpaid principal amount of each Swingline Loan on the earlier
of the Revolving Termination Date and the first date after such Swingline Loan
is made that is the 15th or last day of a calendar month and is at least two
Business Days after such Swingline Loan is made; provided that on each
date that a Revolving Loan is borrowed, the Borrower shall repay all Swingline
Loans then outstanding.

 

2.7.                              Procedure for
Swingline Borrowing; Refunding of Swingline Loans.  (a)  Whenever the
Borrower desires that the Swingline Lender make Swingline Loans it shall give
the Swingline Lender irrevocable telephonic notice confirmed promptly in
writing (which telephonic notice must be received by the Swingline Lender not
later than 1:00 P.M., New York City time, on the proposed Borrowing Date),
specifying (i) the amount to be borrowed and (ii)

 

32

 

the
requested Borrowing Date (which shall be a Business Day during the Revolving
Commitment Period).  Each borrowing under
the Swingline Commitment shall be in an amount equal to $500,000 or a whole
multiple of $100,000 in excess thereof. 
Not later than 3:00 P.M., New York City time, on the Borrowing Date
specified in a notice in respect of Swingline Loans, the Swingline Lender shall
make available to the Administrative Agent at the Funding Office an amount in
immediately available funds equal to the amount of the Swingline Loan to be
made by the Swingline Lender.  The
Administrative Agent shall make the proceeds of such Swingline Loan available
to the Borrower on such Borrowing Date by depositing such proceeds in the
account of the Borrower with the Administrative Agent on such Borrowing Date in
immediately available funds.

 

(b)                                 The Swingline Lender, at any time and
from time to time in its sole and absolute discretion may, on behalf of the
Borrower (which hereby irrevocably directs the Swingline Lender to act on its
behalf), on one Business Day’s notice given by the Swingline Lender no later
than 12:00 Noon, New York City time, request each Revolving Lender to make, and
each Revolving Lender hereby agrees to make, a Revolving Loan, in an amount
equal to such Revolving Lender’s Revolving Percentage of the aggregate amount
of the Swingline Loans (the “Refunded Swingline Loans”) outstanding on
the date of such notice, to repay the Swingline Lender.  Each Revolving Lender shall make the amount
of such Revolving Loan available to the Administrative Agent at the Funding
Office in immediately available funds, not later than 10:00 A.M., New York
City time, one Business Day after the date of such notice.  The proceeds of such Revolving Loans shall be
immediately made available by the Administrative Agent to the Swingline Lender
for application by the Swingline Lender to the repayment of the Refunded
Swingline Loans.  The Borrower
irrevocably authorizes the Swingline Lender to charge the Borrower’s accounts
with the Administrative Agent (up to the amount available in each such account)
in order to immediately pay the amount of such Refunded Swingline Loans to the
extent amounts received from the Revolving Lenders are not sufficient to repay
in full such Refunded Swingline Loans.

 

(c)                                  If prior to the time a Revolving Loan
would have otherwise been made pursuant to Section 2.7(b), one of the
events described in Section 9(g) shall have occurred and be
continuing with respect to the Borrower or if for any other reason, as
determined by the Swingline Lender in its sole discretion, Revolving Loans may
not be made as contemplated by Section 2.7(b), each Revolving Lender
shall, on the date such Revolving Loan was to have been made pursuant to the
notice referred to in Section 2.7(b), purchase for cash an undivided
participating interest in the then outstanding Swingline Loans by paying to the
Swingline Lender an amount (the “Swingline Participation Amount”) equal
to (i) such Revolving Lender’s Revolving Percentage times (ii) the
sum of the aggregate principal amount of Swingline Loans then outstanding that
were to have been repaid with such Revolving Loans.

 

(d)                                 Whenever, at any time after the Swingline
Lender has received from any Revolving Lender such Lender’s Swingline
Participation Amount, the Swingline Lender receives any payment on account of
the Swingline Loans, the Swingline Lender will distribute to such Lender its
Swingline Participation Amount (appropriately adjusted, in the case of interest
payments, to reflect the period of time during which such Lender’s
participating interest was outstanding and funded and, in the case of principal
and interest payments, to reflect such Lender’s pro  rata portion
of such payment if such payment is not sufficient to pay the principal

 

33

 

of and interest on all
Swingline Loans then due); provided, however, that in the event
that such payment received by the Swingline Lender is required to be returned,
such Revolving Lender will return to the Swingline Lender any portion thereof
previously distributed to it by the Swingline Lender.

 

(e)                                  Each Revolving Lender’s obligation to
make the Loans referred to in Section 2.7(b) and to purchase
participating interests pursuant to Section 2.7(c) shall be absolute
and unconditional and shall not be affected by any circumstance, including (i) any
setoff, counterclaim, recoupment, defense or other right that such Revolving
Lender or the Borrower may have against the Swingline Lender, the Borrower or
any other Person for any reason whatsoever, (ii) the occurrence or
continuance of a Default or an Event of Default or the failure to satisfy any
of the other conditions specified in Section 5, (iii) any adverse
change in the condition (financial or otherwise) of the Borrower, (iv) any
breach of this Agreement or any other Loan Document by the Borrower, any other
Loan Party or any other Revolving Lender or (v) any other circumstance,
happening or event whatsoever, whether or not similar to any of the foregoing.

 

2.8.                              Commitment Fees, etc.  (a) 
The Borrower agrees to pay to the Administrative Agent for the account of each
Revolving Lender a commitment fee for the period from and including the date
hereof to the last day of the Revolving Commitment Period, computed at the
Commitment Fee Rate on the average daily amount of the Available Revolving
Commitment of such Lender during the period for which payment is made, payable
quarterly in arrears on each Fee Payment Date, commencing on the first such
date to occur after the date hereof.

 

(b)                                 The Borrower agrees to pay to the
Administrative Agent the fees in the amounts and on the dates as set forth in
any fee agreements with the Administrative Agent and to perform any other
obligations contained therein.

 

2.9.                              Termination or
Reduction of Revolving Commitments.  The Borrower shall have the right, upon not
less than three Business Days’ notice to the Administrative Agent, to terminate
the Revolving Commitments or, from time to time, to reduce the amount of the
Revolving Commitments; provided that no such termination or reduction of
Revolving Commitments shall be permitted if, after giving effect thereto and to
any prepayments of the Revolving Loans and Swingline Loans made on the
effective date thereof, the Total Revolving Extensions of Credit would exceed
the Total Revolving Commitments.  Any
such reduction shall be in an amount equal to $1,000,000, or a whole multiple
thereof, and shall reduce permanently the Revolving Commitments then in effect.

 

2.10.                        Optional Prepayments.  The
Borrower may at any time and from time to time prepay the Loans, in whole or in
part, without premium or penalty, upon irrevocable notice delivered to the
Administrative Agent no later than 11:00 A,M., New York City time, one Business
Day prior thereto, in the case of Eurodollar Loans, and no later than 11:00 A.M.,
New York City time, on the same Business Day, in the case of ABR Loans, which
notice shall specify the date and amount of prepayment and whether the
prepayment is of Eurodollar Loans or ABR Loans; provided, that if a
Eurodollar Loan is prepaid on any day other than the last day of the Interest
Period applicable thereto, the Borrower shall also pay any amounts owing
pursuant to

 

34

 

Section 2.20.  Upon receipt of any such notice the
Administrative Agent shall promptly notify each relevant Lender thereof.  If any such notice is given, the amount
specified in such notice shall be due and payable on the date specified
therein, together with (except in the case of Revolving Loans that are ABR
Loans and Swingline Loans) accrued interest to such date on the amount
prepaid.  Partial prepayments of Term
Loans and Revolving Loans shall be in an aggregate principal amount of
$1,000,000 or a whole multiple thereof. 
Partial prepayments of Swingline Loans shall be in an aggregate
principal amount of $100,000 or a whole multiple thereof.

 

2.11.                        Mandatory Prepayments and
Commitment Reductions.  (a)  (i)  If within ten (10) Business
Days of any date the Borrower or any Restricted Subsidiary shall receive Net
Cash Proceeds (x) in excess of $50,000,000 from any Asset Sale or (y) in excess
of $20,000,000 from any Recovery Event, then, if the Borrower shall not have
delivered a Reinvestment Notice in respect thereof on or prior to such date,
the Borrower shall apply such Net Cash Proceeds on such date to the prepayment
of the Term Loans and the reduction of the Revolving Commitments as set forth
in Section 2.11(c).  If the Borrower
shall have delivered a Reinvestment Notice in respect thereof, then on the
tenth (10th) Business Day after the date of receipt of such Net Cash
Proceeds, the Borrower shall apply the portion thereof, if any, that neither
the Borrower nor any Restricted Subsidiary intends to use to acquire or repair
assets useful in its business to such prepayment and reduction. 

 

(ii)                                  If on or prior to the date falling 365
days after a Reinvestment Event, the Borrower shall not have delivered a
Reinvestment Commitment Notice in respect of the Net Cash Proceeds described in
clause (i) above, the Borrower shall apply such Net Cash Proceeds on such
date (to the extent not previously so applied or expended) to the prepayment of
the Term Loans and the reduction of the Revolving Commitments as set forth in Section 2.11(c).  If on or prior to the date falling 365 days
after a Reinvestment Event, the Borrower shall have delivered a Reinvestment
Commitment Notice in respect of the Net Cash Proceeds described in clause (i) above,
then (x) on the date of such notice, the Borrower shall apply (to the extent
not previously so applied or expended) the portion, if any, of such Net Cash
Proceeds that the Borrower or any Restricted Subsidiary has not committed in
such notice to use to acquire or to repair assets useful in its business to
such prepayment and reduction and (y) on the date falling 180 days after such
notice in the case of Net Cash Proceeds from an Asset Sale described in clause (i) above
and 24 months after such notice in the case of Net Cash Proceeds from a
Recovery Event described in clause (i) above, the Borrower shall apply any
Net Cash Proceeds not applied to the acquisition or repair of assets useful in
its business to such prepayment and reduction as set forth in Section 2.11(c) (to
the extent not previously so applied).

 

(b)                                 If, for any fiscal year of the Borrower
commencing with the fiscal year ending December 31, 2006, there shall be
Free Cash Flow, the Borrower shall, on the relevant Free Cash Flow Application
Date, prepay the Term Loans as set forth in Section 2.11(c) by an
amount equal to (x) the FCF Percentage times (y) such Free Cash Flow minus
the MAG Interest Distribution for such fiscal year.  Each such prepayment shall be made on a date
(a “Free Cash Flow Application Date”) no later than ten (10) Business
Days after the earlier of (i) the date on which the financial statements
of the Borrower referred to in Section 6.2(a), for the fiscal year with
respect to which such prepayment is made, are required to be delivered to the
Lenders and (ii) the date such financial statements are actually
delivered.

 

35

 

(c)                                  Amounts to be applied in connection with
prepayments and Commitment reductions made pursuant to Section 2.11 shall
be applied, first, to the prepayment of the Term Loans in accordance
with Section 2.17(b) and, second, in the case of amounts
applied pursuant to clause (a) above, to reduce permanently the Revolving
Commitments.  Any such reduction of the
Revolving Commitments shall be accompanied by prepayment of the Revolving Loans
and/or Swingline Loans to the extent, if any, that the Total Revolving
Extensions of Credit exceed the amount of the Total Revolving Commitments as so
reduced, provided that if the aggregate principal amount of Revolving
Loans and Swingline Loans then outstanding is less than the amount of such
excess (because Revolving L/C Obligations constitute a portion thereof), the
Borrower shall, to the extent of the balance of such excess, replace
outstanding Revolving Letters of Credit and/or deposit an amount in cash in a
cash collateral account established with the Administrative Agent for the
benefit of the Lenders pursuant to an account control agreement in form and
substance reasonably satisfactory to the Administrative Agent.  The application of any prepayment pursuant to
Section 2.11 shall be made, first, to ABR Loans and, second,
to Eurodollar Loans.  Each prepayment of
the Loans under Section 2.11 (except in the case of Revolving Loans that
are ABR Loans and Swingline Loans) shall be accompanied by accrued interest to
the date of such prepayment on the amount prepaid.

 

(d)                                 If the Borrower is required by this Section 2.11
to prepay any Eurodollar Loans and such prepayment will result in the Borrower
being required to pay breakage costs under Section 2.20 (any such
Eurodollar Loans, “Affected Loans”), the Borrower may elect, by written
notice to the Administrative Agent so long as no Default or Event of Default
shall have occurred and be continuing, to deposit with the Administrative
Agent, on or prior to the date of prepayment of such Affected Loans, 100% (or
such lesser percentage elected by the Borrower) of the principal amounts that
otherwise would have been paid in respect of the Affected Loans and defer the
date of prepayment of such Affected Loans to the extent such Loans are cash
collateralized as provided in this Section 2.11(d).  Such amounts will be held as security for the
obligations of the Borrower hereunder pursuant to an account control agreement
to be entered into in form and substance reasonably satisfactory to the
Administrative Agent, with such cash collateral to be released from such cash
collateral account (and applied to repay the principal amount of Affected
Loans) upon each occurrence thereafter of the last day of an Interest Period
applicable to the relevant Loans (or such earlier date or dates as shall be
requested by the Borrower), with the amount to be so released and applied on
the last day of each Interest Period to be the amount of the relevant Loans to
which such Interest Period applies (or, if less, the amount remaining in such
cash collateral account); provided that, notwithstanding anything in
this Agreement to the contrary, the Borrower acknowledges and agrees that in
calculating the Available Revolving Commitments, such Eurodollar Loans that
have not been prepaid in accordance with this Section 2.11(d) shall
be treated as Revolving Extensions of Credit until such unpaid Eurodollar Loans
are actually prepaid; and provided  further that such unpaid
Eurodollar Loans shall continue to bear interest in accordance with Section 2.14
until such unpaid Eurodollar Loans or the related portion of such Eurodollar
Loans, as the case may be, have or has been prepaid.

 

2.12.                        Conversion and Continuation
Options.  (a)  The Borrower may elect from time to
time to convert Eurodollar Loans to ABR Loans by giving the Administrative
Agent prior irrevocable notice of such election no later than 11:00 A.M.,
New York City time, on the Business Day preceding the proposed conversion date,
provided that any such conversion of

 

36

 

Eurodollar
Loans may only be made on the last day of an Interest Period with respect
thereto.  The Borrower may elect from
time to time to convert ABR Loans to Eurodollar Loans by giving the
Administrative Agent prior irrevocable notice of such election no later than
11:00 A.M., New York City time, on the third Business Day preceding the
proposed conversion date (which notice shall specify the length of the initial
Interest Period therefor), provided that no ABR Loan under a particular
Facility may be converted into a Eurodollar Loan when any Event of Default has
occurred and is continuing and the Administrative Agent or the Majority
Facility Lenders in respect of such Facility have determined in its or their
sole discretion not to permit such conversions. 
Upon receipt of any such notice the Administrative Agent shall promptly
notify each relevant Lender thereof.

 

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

 

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

 

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

 

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

 

(c)                                  (i) If all or a portion of the
principal amount of any Loan or Reimbursement Obligation shall not be paid when
due (whether at the stated maturity, by acceleration or otherwise), such
overdue amount shall bear interest at a rate per annum equal to (x) in the case
of the Loans, the rate that would otherwise be applicable thereto pursuant to
the foregoing provisions of this Section plus 2% or (y) in the case
of Reimbursement Obligations, the rate applicable to ABR Loans under the
Revolving Facility plus 2%, and (ii) if all or a portion of any
interest payable on any Loan or Reimbursement Obligation or any commitment fee
or other amount payable hereunder shall not be paid when due (whether at the
stated

 

37

 

maturity, by acceleration
or otherwise), such overdue amount shall bear interest at a rate per annum
equal to the rate then applicable to ABR Loans under the relevant Facility plus
2% (or, in the case of any such other amounts that do not relate to a
particular Facility, the rate then applicable to ABR Loans under the Revolving
Facility plus 2%), in each case, with respect to clauses (i) and (ii) above,
from the date of such non-payment until such amount is paid in full (as well
after as before judgment).

 

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

 

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

 

(b)                                 Each determination of an interest rate by
the Administrative Agent pursuant to any provision of this Agreement shall be
conclusive and binding on the Borrower and the Lenders in the absence of
manifest error.  The Administrative Agent
shall, at the request of the Borrower, deliver to the Borrower a statement
showing the quotations used by the Administrative Agent in determining any
interest rate pursuant to Section 2.14(a).

 

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

 

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

 

(b)                                 the Administrative Agent shall have
received notice from the Majority Facility Lenders in respect of the relevant
Facility that the Eurodollar Rate determined or to be determined for such
Interest Period will not adequately and fairly reflect the cost to such Lenders
(as conclusively certified by such Lenders) of making or maintaining their
affected Loans during such Interest Period,

 

the
Administrative Agent shall give telecopy or telephonic notice thereof to the
Borrower and the relevant Lenders as soon as practicable thereafter.  If such notice is given (x) any Eurodollar
Loans under the relevant Facility requested to be made on the first day of such
Interest Period shall be made as ABR Loans, (y) any Loans under the
relevant Facility that were to have been

 

38

 

converted
on the first day of such Interest Period to Eurodollar Loans shall be continued
as ABR Loans and (z) any outstanding Eurodollar Loans under the relevant
Facility shall be converted, on the last day of the then-current Interest
Period, to ABR Loans.  Until such notice
has been withdrawn by the Administrative Agent, no further Eurodollar Loans
under the relevant Facility shall be made or continued as such, nor shall the
Borrower have the right to convert Loans under the relevant Facility to
Eurodollar Loans.

 

2.17.                        Pro Rata Treatment and
Payments.  (a)  Each borrowing by the Borrower from
the Lenders hereunder, each payment by the Borrower on account of any
commitment fee and any reduction of the Commitments of the Lenders shall be
made pro  rata according to the respective Term Percentages or
Revolving Percentages, as the case may be, of the relevant Lenders.

 

(b)                                 Each payment (including each prepayment)
by the Borrower on account of principal of and interest on the Term Loans shall
be made pro  rata according to the respective outstanding
principal amounts of the Term Loans then held by the Term Lenders.  The amount of each principal prepayment of
the Term Loans shall be applied to reduce the then remaining installments of
the Term Loans pro  rata based upon the respective then remaining
principal amounts thereof, provided that, in the case of any optional
prepayment of Term Loans pursuant to Section 2.10, the amount of principal
prepayment shall be applied as directed by the Borrower in its notice issued
pursuant to such Section.  Amounts
prepaid or repaid on account of the Term Loans may not be reborrowed.

 

(c)                                  Each payment (including each prepayment)
by the Borrower on account of principal of and interest on the Revolving Loans
shall be made pro  rata according to the respective outstanding
principal amounts of the Revolving Loans then held by the Revolving Lenders.

 

(d)                                 All payments (including prepayments) to
be made by the Borrower hereunder, whether on account of principal, interest,
fees or otherwise, shall be made without setoff or counterclaim and shall be
made prior to 12:00 Noon, New York City time, on the due date thereof to the
Administrative Agent, for the account of the Lenders, at the Funding Office, in
Dollars and in immediately available funds. 
The Administrative Agent shall distribute such payments to the Lenders
promptly upon receipt in like funds as received.  If any payment hereunder (other than payments
on the Eurodollar Loans) becomes due and payable on a day other than a Business
Day, such payment shall be extended to the next succeeding Business Day.  If any payment on a Eurodollar Loan becomes
due and payable on a day other than a Business Day, the maturity thereof shall
be extended to the next succeeding Business Day unless the result of such
extension would be to extend such payment into another calendar month, in which
event such payment shall be made on the immediately preceding Business
Day.  In the case of any extension of any
payment of principal pursuant to the preceding two sentences, interest thereon
shall be payable at the then applicable rate during such extension.

 

(e)                                  Unless the Administrative Agent shall
have been notified in writing by any Lender prior to a borrowing that such
Lender will not make the amount that would constitute its share of such
borrowing available to the Administrative Agent, the Administrative Agent may
assume that such Lender is making such amount available to the Administrative
Agent, and the

 

39

 

Administrative Agent may,
in reliance upon such assumption, make available to the Borrower a
corresponding amount.  If such amount is
not made available to the Administrative Agent by the required time on the
Borrowing Date therefor, such Lender shall pay to the Administrative Agent, on
demand, such amount with interest thereon, at a rate equal to the greater of (i) the
Federal Funds Effective Rate and (ii) a rate determined by the
Administrative Agent in accordance with banking industry rules on
interbank compensation, for the period until such Lender makes such amount immediately
available to the Administrative Agent.  A
certificate of the Administrative Agent submitted to any Lender with respect to
any amounts owing under this paragraph shall be conclusive in the absence of
manifest error.  If such Lender’s share
of such borrowing is not made available to the Administrative Agent by such
Lender within three Business Days after such Borrowing Date, the Administrative
Agent shall also be entitled to recover such amount with interest thereon at
the rate per annum applicable to ABR Loans under the relevant Facility, on
demand, from the Borrower.

 

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

 

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

 

(i)                                     shall change the basis of taxation of
payments to such Lender in respect of this Agreement, any Letter of Credit, any
Application or any Eurodollar Loan made by it (except for changes in the rate
of tax on, or determined by reference to, the overall net income or gross
income of such Lender); or

 

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

 

and
the result of any of the foregoing is to increase the cost to such Lender, by
an amount that such Lender deems to be material, of making, converting into,
continuing or maintaining Eurodollar Loans or issuing or participating in
Letters of Credit, or to reduce any amount receivable hereunder in respect
thereof, then, in any such case, the Borrower shall promptly pay

 

40

 

such
Lender, upon its demand, any additional amounts necessary to compensate such
Lender for such increased cost or reduced amount receivable.  If any Lender becomes entitled to claim any
additional amounts pursuant to this paragraph, it shall promptly notify the
Borrower (with a copy to the Administrative Agent) of the event by reason of
which it has become so entitled.

 

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

 

(c)                                  A certificate as to any additional
amounts payable pursuant to this Section submitted by any Lender to the
Borrower (with a copy to the Administrative Agent) shall be conclusive in the
absence of manifest error. 
Notwithstanding anything to the contrary in this Section, the Borrower
shall not be required to compensate a Lender pursuant to this Section for
any amounts incurred more than four months prior to the date that such Lender
notifies the Borrower of such Lender’s intention to claim compensation
therefor; provided that, if the circumstances giving rise to such claim
have a retroactive effect, then such four-month period shall be extended to
include the period of such retroactive effect. 
The obligations of the Borrower pursuant to this Section shall
survive the termination of this Agreement and the payment of the Loans and all
other amounts payable hereunder.

 

2.19.                        Taxes.  (a) 
All payments made by the Borrower under this Agreement shall be made free and
clear of, and without deduction or withholding for or on account of, any
present or future income, stamp or other taxes, levies, imposts, duties,
charges, fees, deductions or withholdings, now or hereafter imposed, levied,
collected, withheld or assessed by any Governmental Authority, excluding any
tax imposed on or measured by the net income or net profits or capital (or any
franchise or similar tax imposed in lieu thereof) of the Administrative Agent
or any Lender as a result of a present or former connection between the
Administrative Agent or such Lender or the principal office or applicable
lending office of such Lender or any subdivision thereof or therein and the
jurisdiction of the Governmental Authority imposing such tax or any political
subdivision or taxing authority thereof or therein (other than any such
connection arising solely from the Administrative Agent or such Lender having
executed, delivered or performed its obligations or received a payment under,
or enforced, this Agreement or any other Loan Document).  If any such non-excluded taxes, levies,
imposts, duties, charges, fees, deductions or withholdings (“Non-Excluded
Taxes”) or Other Taxes are required to be withheld from any amounts payable
to the Administrative Agent or any Lender hereunder, the amounts so payable to
the Administrative Agent or such Lender shall be increased to the extent
necessary to yield to the Administrative Agent or such Lender (after payment of
all Non-

 

41

 

Excluded
Taxes and Other Taxes) interest or any such other amounts payable hereunder at
the rates or in the amounts specified in this Agreement, provided, however,
that the Borrower shall be entitled, to the extent it is required to do so by
law, to deduct or withhold income or similar taxes imposed by the United States
(or any political subdivision or taxing authority thereof or therein) from
interest, fees or other amounts payable hereunder for the account of any Lender
which is not a United States person (as such term is defined in Section 7701(a)(30)
of the Code) for U.S. federal income tax purposes, and the Borrower shall not
be required to increase any such amounts payable to any Lender with respect to
any Non-Excluded Taxes (i) that are attributable to such Lender’s failure
to comply with the requirements of paragraph (d) or (e) of this Section or
(ii) that are United States withholding taxes imposed on amounts payable
to such Lender at the time such Lender becomes a party to this Agreement,
except to the extent that such Lender’s assignor (if any) was entitled, at the
time of assignment, to receive additional amounts from the Borrower with
respect to such Non-Excluded Taxes pursuant to this paragraph.

 

(b)                                 In addition, the Borrower shall pay any
Other Taxes to the relevant Governmental Authority in accordance with applicable
law.

 

(c)                                  Whenever any Non-Excluded Taxes or Other
Taxes are payable by the Borrower, within thirty (30) days thereafter the
Borrower shall send to the Administrative Agent for its own account or for the
account of the relevant Lender, as the case may be, a certified copy of a tax
receipt received by the Borrower showing payment thereof or such other document
reasonably satisfactory to the Administrative Agent showing payment
thereof.  If the Borrower fails to pay
any Non-Excluded Taxes or Other Taxes when due to the appropriate taxing
authority, the Borrower shall indemnify the Administrative Agent and the
Lenders upon their written request for any incremental taxes, interest or
penalties that may become payable by the Administrative Agent or any Lender as
a result of any such failure.

 

(d)                                 Each Lender (or Transferee) that is not a
“U.S. Person” as defined in Section 7701(a)(30) of the Code (a “Non-U.S.
Lender”) shall deliver to the Borrower and the Administrative Agent (or, in
the case of a Participant, to the Lender from which the related participation
shall have been purchased) two copies of either U.S. Internal Revenue Service Form W-8BEN
(with respect to a complete exemption under an income tax treaty) or Form W-8ECI,
or any successors thereto, or, in the case of a Non-U.S. Lender claiming
exemption from U.S. federal withholding tax under Section 871(h) or
881(c) of the Code with respect to payments of “portfolio interest”, a
statement substantially in the form of Exhibit G and a Form W-8BEN,
or any subsequent versions thereof or successors thereto, properly completed
and duly signed and executed by such Non-U.S. Lender claiming complete
exemption from U.S. federal withholding tax on all payments by the Borrower
under this Agreement and the other Loan Documents.  Such forms shall be delivered by each
Non-U.S. Lender on or before the date it becomes a party to this Agreement (or,
in the case of any Participant, on or before the date such Participant
purchases the related participation).  In
addition, each Non-U.S. Lender shall deliver such forms promptly upon the
obsolescence or invalidity of any form previously delivered by such Non-U.S.
Lender.  Each Non-U.S. Lender shall
promptly notify the Borrower at any time it determines that it is no longer in
a position to provide any previously delivered certificate to the Borrower (or
any other form of certification adopted by the U.S. taxing authorities for such
purpose).  Notwithstanding any other
provision of this paragraph, a Non-U.S. Lender shall not be required to deliver
any form pursuant to this paragraph that such Non-U.S. Lender is not legally

 

42

 

able to deliver as a
result of a change in applicable law after the date such Lender becomes a party
to this Agreement (or, in the case of any Participant, after the date such
Participant purchases the related participation).

 

(e)                                  A Lender that is entitled to an exemption
from or reduction of non-U.S. withholding tax under the law of the jurisdiction
in which the Borrower is located, or any treaty to which such jurisdiction is a
party, with respect to payments under this Agreement shall deliver to the
Borrower (with a copy to the Administrative Agent), at the time or times
prescribed by applicable law or reasonably requested by the Borrower, such
properly completed and executed documentation prescribed by applicable law as
will permit such payments to be made without withholding or at a reduced rate, provided
that such Lender is legally entitled to complete, execute and deliver such
documentation and in such Lender’s judgment such completion, execution or
submission would not materially prejudice the legal position of such Lender.

 

(f)                                    If the Administrative Agent or any Lender
determines, in its sole discretion, that it has received a refund or credit of
any Non-Excluded Taxes or Other Taxes as to which it has been indemnified by
the Borrower or with respect to which the Borrower has paid additional amounts
pursuant to this Section 2.19, it shall pay over such refund or credit to
the Borrower (but only to the extent of indemnity payments made, or additional
amounts paid, by the Borrower under this Section 2.19 with respect to the
Non-Excluded Taxes or Other Taxes giving rise to such refund or credit), net of
all out-of-pocket expenses of the Administrative Agent or such Lender and
without interest (other than any interest paid by the relevant Governmental
Authority with respect to such refund or credit); provided, that the
Borrower, upon the written request of the 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 Authority) to
the Administrative Agent or such Lender in the event the Administrative Agent
or such Lender is required to repay such refund to such Governmental Authority.
This paragraph shall not be construed to require the Administrative Agent or
any Lender to make available its tax returns (or any other information relating
to its taxes which it deems confidential) to the Borrower or any other Person.

 

(g)                                 The agreements in this Section shall
survive the termination of this Agreement and the payment of the Loans and all
other amounts payable hereunder.

 

2.20.                        Indemnity.  The
Borrower agrees to indemnify each Lender for, and to hold each Lender harmless
from, any actual and documented loss or expense determined in accordance with
this Section 2.20 that such Lender may sustain or incur as a consequence
of (a) default by the Borrower in making a borrowing of, conversion into
or continuation of Eurodollar Loans after the Borrower has given a notice
requesting the same in accordance with the provisions of this Agreement, (b) default
by the Borrower in making any prepayment of or conversion from Eurodollar Loans
after the Borrower has given a notice thereof in accordance with the provisions
of this Agreement or (c) the making of a prepayment of Eurodollar Loans on
a day that is not the last day of an Interest Period with respect thereto.  Such indemnification may include an amount
equal to the excess, if any, of (i) the amount of interest that would have
accrued on the amount so prepaid, or not so borrowed, converted or continued,
for the period from the date of such prepayment or of such failure to borrow,
convert or continue to the last day of such Interest Period (or, in the case of
a failure to borrow, convert or continue, the Interest

 

43

 

Period
that would have commenced on the date of such failure) in each case at the
applicable rate of interest for such Loans provided for herein (excluding,
however, the Applicable Margin included therein, if any) over (ii) the
amount of interest (as reasonably determined by such Lender) that would have
accrued to such Lender on such amount by placing such amount on deposit for a
comparable period with leading banks in the interbank eurodollar market.  A certificate as to any amounts payable
pursuant to this Section submitted to the Borrower by any Lender shall be
conclusive in the absence of manifest error. 
Notwithstanding anything to the contrary in this Section, the Borrower
shall not be required to compensate a Lender pursuant to this Section for
any loss or expense resulting from any event set forth in clauses (a), (b) or
(c) of the first sentence of this Section if such event occurred more
than sixty (60) days prior to any demand for indemnification by such
Lender.  This covenant shall survive the
termination of this Agreement and the payment of the Loans and all other
amounts payable hereunder.

 

2.21.                        Change of Lending Office.  Each
Lender agrees that, upon the occurrence of any event giving rise to the
operation of Section 2.18 or 2.19(a) with respect to such Lender, it
will, if requested by the Borrower, use reasonable efforts (subject to overall
policy considerations of such Lender) to designate another lending office for
any Loans affected by such event with the object of avoiding the consequences
of such event; provided, that such designation is made on terms that, in
the sole judgment of such Lender, cause such Lender and its lending office(s)
to suffer no economic, legal or regulatory disadvantage, and provided, further,
that nothing in this Section shall affect or postpone any of the
obligations of the Borrower or the rights of any Lender pursuant to Section 2.18
or 2.19(a).

 

2.22.                        Replacement of Lenders.  The
Borrower shall be permitted to replace any Lender in accordance with Section 11.6
that (a) requests reimbursement for amounts owing pursuant to Section 2.18
or 2.19(a) or (b) defaults in its obligation to make Loans hereunder,
with a replacement financial institution; provided that (i) such
replacement does not conflict with any Requirement of Law, (ii) the
replacement financial institution shall purchase, at par, all Loans and other
amounts owing to such replaced Lender on or prior to the date of replacement in
accordance with Section 11.6, (iii) the Borrower shall be liable to
such replaced Lender under Section 2.20 if any Eurodollar Loan owing to
such replaced Lender shall be purchased other than on the last day of the
Interest Period relating thereto, (iv) the Administrative Agent and each
Issuing Lender shall have consented to the replacement financial institution
(such consent not to be unreasonably withheld), (v) the replaced Lender
shall be obligated to make such replacement in accordance with the provisions
of Section 11.6 (provided that the Borrower shall be obligated to pay the
registration and processing fee referred to therein), (vi) until such time
as such replacement shall be consummated, the Borrower shall pay all additional
amounts (if any) required pursuant to Section 2.18 or 2.19(a), as the case
may be, and (vii) any such replacement shall not be deemed to be a waiver
of any rights that the Borrower, the Administrative Agent or any other Lender
shall have against the replaced Lender.

 

SECTION 3.  LETTERS
OF CREDIT

 

3.1.                              Revolving L/C
Commitment.  (a)  Subject to the terms and conditions
hereof, each Revolving Issuing Lender, in reliance on the agreements of the
other Revolving Lenders set forth in Section 3.4(a), agrees to issue
letters of credit (“Revolving Letters of Credit”) for the account of the
Borrower on any Business Day during the Revolving

 

44

 

Commitment
Period in such form as may be approved from time to time by such Revolving
Issuing Lender (such approval not to be unreasonably withheld); provided
that no Revolving Issuing Lender shall have any obligation to issue any Revolving
Letter of Credit if, after giving effect to such issuance, (i) the
Revolving L/C Obligations would exceed the Revolving L/C Commitment, (ii) the
aggregate amount of the Available Revolving Commitments would be less than zero
or (iii) the Revolving L/C Obligations with respect to all Revolving
Letters of Credit issued by such Revolving Issuing Lender would exceed such
Revolving Issuing Lender’s Specified Issuing Lender Commitment.  Each Revolving Letter of Credit shall (i) be
denominated in Dollars and payable on an “at sight” basis and (ii) expire
no later than the earlier of (x) the first anniversary of its date of issuance
and (y) the date that is five Business Days prior to the Revolving Termination
Date, provided that any Revolving Letter of Credit with a one-year term
may provide for the automatic renewal thereof for additional one-year periods
(which shall in no event extend beyond the date referred to in clause (y)
above).

 

(b)                                 No Revolving Issuing Lender shall at any
time be obligated to issue any Revolving Letter of Credit if such issuance
would conflict with, or cause such Revolving Issuing Lender or any Revolving
L/C Participant to exceed any limits imposed by, any applicable Requirement of
Law.

 

3.2.                              Procedure for Issuance
of Revolving Letters of Credit.  The Borrower may from time to time request
that the relevant Revolving Issuing Lender issue a Revolving Letter of Credit
by delivering to such Revolving Issuing Lender at its address for notices
specified herein an Application therefor. 
Upon receipt of a duly completed and executed Application and any
certificates, documents and other papers and information (referred to herein or
in the Application) delivered to the Revolving Issuing Lender in connection
therewith, the relevant Revolving Issuing Lender shall process such Application
in accordance with its customary procedures and promptly issue the Revolving
Letter of Credit requested thereby (but in no event shall any Revolving Issuing
Lender be required to issue any Revolving Letter of Credit earlier than three (3) Business
Days (or such shorter period as such Revolving Issuing Lender may agree) after
its receipt of the duly completed and executed Application therefor and all
such other certificates, documents and other papers and information referred to
herein and therein and relating thereto) by issuing the original of such
Revolving Letter of Credit to the beneficiary thereof or as otherwise may be
agreed to by such Revolving Issuing Lender and the Borrower.  Such Revolving Issuing Lender shall furnish a
copy of such Revolving Letter of Credit to the Borrower promptly following the
issuance thereof.  Each Revolving Issuing
Lender shall promptly furnish to the Administrative Agent, which shall in turn
promptly furnish to the Lenders, notice of the issuance of each Revolving
Letter of Credit (including the amount thereof).

 

3.3.                              Revolving L/C Fees and
Other Charges.  (a)  The Borrower will pay a fee on all
the average daily aggregate maximum amount available to be drawn under all
outstanding Revolving Letters of Credit at a per annum rate equal to the
Applicable Margin then in effect with respect to Eurodollar Loans under the
Revolving Facility, less any fees paid pursuant to the second sentence of this
paragraph, shared ratably among the Revolving Lenders and payable quarterly in
arrears on each Fee Payment Date after the issuance date.  In addition, the Borrower shall pay to each
Revolving Issuing Lender for its own account a fronting fee of 0.125% per

 

45

 

annum
on the stated amount of each Revolving Letter of Credit issued by such
Revolving Issuing Lender, payable quarterly in arrears on each Fee Payment Date
after the issuance date.

 

(b)                                 In addition to the foregoing fees, the
Borrower shall pay or reimburse each Revolving Issuing Lender for such normal
and customary costs and expenses as are incurred or charged by such Revolving
Issuing Lender in issuing, negotiating, effecting payment under, amending or
otherwise administering any Revolving Letter of Credit.

 

3.4.                              Revolving L/C
Participations.  (a)  Each Revolving Issuing Lender
irrevocably agrees to grant and hereby grants to each Revolving L/C
Participant, and, to induce such Revolving Issuing Lender to issue Revolving
Letters of Credit, each Revolving L/C Participant irrevocably agrees to accept
and purchase and hereby accepts and purchases from such Revolving Issuing
Lender, on the terms and conditions set forth below, for such Revolving L/C
Participant’s own account and risk an undivided interest equal to such
Revolving L/C Participant’s Revolving Percentage in such Revolving Issuing
Lender’s obligations and rights under and in respect of each Revolving Letter
of Credit issued by such Revolving Issuing Lender and the amount of each draft
paid by such Revolving Issuing Lender thereunder.  Each Revolving L/C Participant agrees with
each Revolving Issuing Lender that, if a draft is paid under any Revolving
Letter of Credit issued by such Revolving Issuing Lender for which such
Revolving Issuing Lender is not reimbursed in full by the Borrower in
accordance with the terms of this Agreement, such Revolving L/C Participant
shall pay to such Revolving Issuing Lender upon demand at such Revolving
Issuing Lender’s address for notices specified herein an amount equal to such
Revolving L/C Participant’s Revolving Percentage of the amount of such draft,
or any part thereof, that is not so reimbursed. 
Each Revolving L/C Participant’s obligation to pay such amount shall be
absolute and unconditional and shall not be affected by any circumstance,
including (i) any setoff, counterclaim, recoupment, defense or other right
that such Revolving L/C Participant may have against any Revolving Issuing
Lender, the Borrower or any other Person for any reason whatsoever, (ii) the
occurrence or continuance of a Default or an Event of Default or the failure to
satisfy any of the other conditions specified in Section 5, (iii) any
adverse change in the condition (financial or otherwise) of the Borrower, (iv) any
breach of this Agreement or any other Loan Document by the Borrower, any other
Loan Party or any other Revolving L/C Participant or (v) any other
circumstance, happening or event whatsoever, whether or not similar to any of
the foregoing.

 

(b)                                 If any amount required to be paid by any
Revolving L/C Participant to any Revolving Issuing Lender pursuant to Section 3.4(a) in
respect of any unreimbursed portion of any payment made by such Revolving
Issuing Lender under any Revolving Letter of Credit is paid to such Revolving Issuing
Lender within three Business Days after the date such payment is due, such
Revolving L/C Participant shall pay to such Revolving Issuing Lender on demand
an amount equal to the product of (i) such amount, times (ii) the
daily average Federal Funds Effective Rate during the period from and including
the date such payment is required to the date on which such payment is
immediately available to such Revolving Issuing Lender, times (iii) a
fraction the numerator of which is the number of days that elapse during such
period and the denominator of which is 360. 
If any such amount required to be paid by any Revolving L/C Participant
pursuant to Section 3.4(a) is not made available to the relevant
Revolving Issuing Lender by such Revolving L/C Participant within three
Business Days after the date such payment is due, such Revolving Issuing Lender
shall be entitled to recover from such Revolving

 

46

 

L/C Participant, on
demand, such amount with interest thereon calculated from such due date at the
rate per annum applicable to ABR Loans under the Revolving Facility.  A certificate of the relevant Revolving
Issuing Lender submitted to any Revolving L/C Participant with respect to any
amounts owing under this Section shall be conclusive in the absence of
manifest error.

 

(c)                                  Whenever, at any time after any Revolving
Issuing Lender has made payment under any Revolving Letter of Credit and has
received from any Revolving L/C Participant its pro  rata share of
such payment in accordance with Section 3.4(a), such Revolving Issuing
Lender receives any payment related to such Revolving Letter of Credit (whether
directly from the Borrower or otherwise, including proceeds of collateral
applied thereto by such Revolving Issuing Lender), or any payment of interest
on account thereof, such Revolving Issuing Lender will distribute to such
Revolving L/C Participant its pro  rata share thereof; provided,
however, that in the event that any such payment received by such
Revolving Issuing Lender shall be required to be returned by such Revolving
Issuing Lender, such Revolving L/C Participant shall return to such Revolving
Issuing Lender the portion thereof previously distributed by such Revolving
Issuing Lender to it.

 

3.5.                              Revolver L/C Reimbursement
Obligation of the Borrower.  If any draft is paid under any Revolving
Letter of Credit, the Borrower shall reimburse the relevant Revolving Issuing
Lender for the amount of (a) the draft so paid and (b) any taxes,
fees, charges or other costs or expenses incurred by such Revolving Issuing
Lender in connection with such payment, not later than 12:00 Noon, New York
City time, on (i) the Business Day that the Borrower receives notice of
such draft, if such notice is received on such day prior to 10:00 A.M.,
New York City time, or (ii) if clause (i) above does not apply, the
Business Day immediately following the day that the Borrower receives such
notice.  Each such payment shall be made
to the relevant Revolving Issuing Lender at its address for notices referred to
herein in Dollars and in immediately available funds.  Interest shall be payable on any such amounts
from the date on which the relevant draft is paid until payment in full at the
rate set forth in (x) until the Business Day next succeeding the date of the
relevant notice, Section 2.14(b) and (y) thereafter, Section 2.14(c).  If the Borrower fails to reimburse any
Revolving Issuing Lender in accordance with this Section 3.5, the Borrower
shall be deemed to have made a request for a borrowing of ABR Loans pursuant to
Section 2.5(b) as provided in such Section.

 

3.6.                              Synthetic L/C Letters
of Credit.  (a)  
Subject to the terms and conditions hereof, the Synthetic Issuing
Lender, in reliance on the agreement of the Borrower set forth in Section 3.8(b),
agrees to issue letters of credit (the “Synthetic Letters of Credit “)
for the account of the Borrower on any Business Day prior to the date set forth
in clause (y) of the next succeeding sentence in such form as may be approved
from time to time by the Synthetic Issuing Lender (such approval not to be
unreasonably withheld); provided, that the Synthetic Issuing Lender
shall have no obligation to issue any Synthetic Letter of Credit if, after
giving effect to such issuance, the aggregate principal amount of Synthetic L/C
Letter of Credit Outstandings would exceed the Synthetic L/C Deposit
Amount.  Each Synthetic Letter of Credit
shall (i) be denominated in Dollars and payable on an “at sight” basis and
(ii) expire no later than the earlier of (x) the first anniversary of its
date of issuance and (y) the date that is five Business Days prior to the
Synthetic L/C Termination Date, provided that any Synthetic Letter of
Credit with a one-year term may provide for the automatic renewal thereof for
additional one-year periods (which shall in no event extend beyond the date
referred to in clause (y) above).

 

47

 

(b)                                 The Synthetic Issuing Lender shall not at
any time be obligated to issue any Synthetic Letter of Credit hereunder if (i) such
issuance would conflict with, or cause the Synthetic Issuing Lender to exceed
any limits imposed by, any applicable Requirement of Law or (iii) the
Synthetic L/C Termination Date shall have occurred.

 

3.7.                              Procedure for Issuance
of Synthetic Letters of Credit.  The Borrower may from time to time request
that the Synthetic Issuing Lender issue a Synthetic Letter of Credit by delivering
to the Synthetic Issuing Lender at its address for notices specified herein an
Application therefor.  Upon receipt of a
duly completed and executed Application and any certificates, documents and
other papers and information (referred to herein or in the Application)
delivered to the Synthetic Issuing Lender in connection therewith, the
Synthetic Issuing Lender shall process such Application in accordance with its
customary procedures and promptly issue the Synthetic Letter of Credit
requested thereby (but in no event shall the Synthetic Issuing Lender be
required to issue any Synthetic Letter of Credit earlier than three (3) Business
Days (or such shorter period as the Synthetic Issuing Lender may agree) after
its receipt of the duly completed and executed Application therefor and all
such other certificates, documents and other papers and information referred to
herein and therein and relating thereto) by issuing the original of such
Synthetic Letter of Credit to the beneficiary thereof or as otherwise may be
agreed to by the Synthetic Issuing Lender and the Borrower.  The Synthetic Issuing Lender shall furnish a
copy of such Synthetic Letter of Credit to the Borrower promptly following the
issuance thereof.  The Synthetic Issuing
Lender shall promptly furnish to the Administrative Agent, which shall in turn
promptly furnish to the Lenders, notice of the issuance of each Synthetic
Letter of Credit (including the amount thereof).

 

3.8.                              Synthetic L/C Deposit
Account.  (a)  Establishment of Synthetic L/C Deposit
Account.  On or prior to the Closing
Date, the Borrower shall establish and maintain the Synthetic L/C Deposit
Account at the Synthetic Issuing Lender in the name of the Synthetic Issuing
Lender for the benefit of the Synthetic Issuing Lender and the other Secured
Parties (as defined in the Guarantee and Collateral Agreement) and shall enter
into a synthetic letter of credit deposit and account control agreement (the “Synthetic
L/C Deposit Agreement”) with the Synthetic Issuing Lender in form and substance
satisfactory to it.  Amounts on deposit
in the Synthetic L/C Deposit Account shall be invested, or caused to be
invested, by the Synthetic Issuing Lender as set forth in Section 3.8(d),
and no Person (other than the Synthetic Issuing Lender or any of its respective
sub-agents) shall have the right to make any withdrawals from the Synthetic L/C
Deposit Account or exercise any other right or power with respect thereto,
except as expressly provided in Section 3.8(c).  Without limiting the generality of the
foregoing, each party hereto acknowledges and agrees that the amount on deposit
at any time in the Synthetic L/C Deposit Account shall constitute “Collateral”
under the Loan Documents and shall be available, subject to the terms of the
Loan Documents, to satisfy any Obligation of any Loan Party under the Loan
Documents to the extent that such amount exceeds the Synthetic Letter of Credit
Outstandings.

 

(b)                                 Deposits in Synthetic L/C Deposit Account.  

 

(1)                                  On the Closing Date, the Borrower shall
deposit $200,000,000 of proceeds of Term Loans made on the Closing Date in the Synthetic
L/C Deposit Account.

 

48

 

(2)                                  At any time after the Closing Date, the
Borrower shall be permitted to deposit additional amounts in the Synthetic L/C
Deposit Account to the extent amounts have been withdrawn from the Synthetic
L/C Deposit Account pursuant to Section 3.8(c) (1) or (3) below,
provided that after giving effect to any such deposit, the aggregate amount on
deposit shall not exceed $200,000,000.

 

(c)                                  Withdrawals from and Closing of Synthetic
L/C Deposit Account.  Amounts on deposit in the Synthetic L/C
Deposit Account shall be withdrawn and distributed as follows:

 

(1)                                  on any date on which the Borrower fails
to reimburse the Synthetic Issuing Lender for any payment made by the Synthetic
Issuing Lender with respect to any Synthetic Letter of Credit, the Synthetic
Issuing Lender shall withdraw from the Synthetic L/C Deposit Account an amount
equal to the amount of such unreimbursed payment, in accordance with Section 3.10;

 

(2)                                  following the occurrence of an Event of
Default, the Synthetic Issuing Lender shall permit the Administrative Agent to
withdraw from the Synthetic L/C Deposit Account an amount equal to the amount
by which the Synthetic L/C Deposit exceeds the Synthetic Letter of Credit
Outstandings, pursuant to and to be applied in accordance with the Security
Documents; 

 

(3)                                  at any time prior to the Synthetic L/C
Termination Date, upon three (3) Business Days’ prior written notice to
the Synthetic Issuing Bank and so long as no Default or Event of Default has
occurred and is continuing, the Borrower may withdraw a portion of the
Synthetic L/C Deposit (including any accrued income on the Synthetic L/C
Deposit) that is in excess of the Synthetic L/C Letter of Credit Outstandings;
and

 

(4)                                  upon (A) the reduction or
termination of the Synthetic L/C Deposit Amount to $0 and (B) the
expiration or cancellation of all outstanding Synthetic Letters of Credit to
the satisfaction of the Synthetic Issuing Lender, the Synthetic Issuing Lender
shall permit the Borrower to withdraw all remaining amounts from the Synthetic
L/C Deposit Account and shall close the Synthetic L/C Deposit Account.

 

The
commitment of the Synthetic Issuing Lender shall never exceed the Synthetic L/C
Deposit, after giving effect to outstanding Synthetic Letters of Credit,
withdrawals and deposits.

 

(d)                                 Investment of Synthetic L/C Amount. 
The Synthetic Issuing Lender shall invest, or cause to be invested, the
amount on deposit in the Synthetic L/C Deposit Account in certain Cash
Equivalents reasonably approved by the Borrower and the Synthetic Issuing
Lender.  Any return on the Synthetic L/C
Deposit shall accrue for the benefit of the Borrower.  The Borrower acknowledges and agrees that the
return earned on the Synthetic L/C Deposit shall not in any way affect the
Borrower’s obligations with respect to the Term Loans.  

 

3.9.                              Synthetic L/C Deposit
Fees and Other Charges.  (a)  The Borrower shall pay to the Synthetic
Issuing Lender for its own account a fronting fee of 0.125% per annum on

 

49

 

the
undrawn and unexpired amount of each Synthetic Letter of Credit issued by the
Synthetic Issuing Lender, payable quarterly in arrears on each Fee Payment Date
after the issuance date.

 

(b)                                 In addition to the foregoing fee, the
Borrower shall pay or reimburse the Synthetic Issuing Lender for such normal
and customary costs and expenses as are incurred or charged by the Synthetic
Issuing Lender in issuing, negotiating, effecting payment under, amending or
otherwise administering any Synthetic Letter of Credit.

 

3.10.                        Synthetic L/C Reimbursement
Obligations.  If any draft is paid under the Synthetic
Letter of Credit, the Borrower shall reimburse the Synthetic Issuing Lender for
the amount of (a) the draft so paid and (b) any taxes, fees, charges
or other costs or expenses incurred by the Synthetic Issuing Lender in
connection with such payment, not later than 12:00 Noon, New York City time, on
the second Business Day following the Business Day on which the Borrower
receives notice of such draft.  Each such
payment shall be made to the Synthetic Issuing Lender at its address for
notices referred to herein in Dollars and in immediately available funds.  Interest shall be payable on any such amounts
from the date the relevant draft is paid until payment in full at the rate set
forth in (x) until the Business Day next succeeding the date of the relevant
draw notice, Section 2.14(b) and (y) thereafter, Section 2.14(c).  If the Borrower fails to reimburse the
Synthetic Issuing Lender at the time and place and in the manner described
above in this Section 3.10, the Synthetic Issuing Lender shall withdraw
from the Synthetic L/C Deposit Account an amount equal to the amount of such
unreimbursed payment.  Drawings under a
Synthetic Letters of Credit shall be deemed to be reimbursed to the extent
funds on deposit in the Synthetic L/C Deposit Account are withdrawn and applied
thereto in accordance with Sections 3.8(c)(1).    

 

3.11.                        Obligations Absolute.  The
Borrower’s obligations under this Section 3 shall be absolute and
unconditional under any and all circumstances and irrespective of any setoff,
counterclaim or defense to payment that the Borrower may have or have had
against any Issuing Lender, any beneficiary of a Letter of Credit or any other
Person.  The Borrower also agrees with
each Issuing Lender that such Issuing Lender shall not be responsible for, and
the Borrower’s Reimbursement Obligations under Sections 3.5 and 3.10 shall not
be affected by, among other things, the validity or genuineness of documents or
of any endorsements thereon, even though such documents shall in fact prove to
be invalid, fraudulent or forged, or any dispute between or among the Borrower
and any beneficiary of any Letter of Credit or any other party to which such
Letter of Credit may be transferred or any claims whatsoever of the Borrower
against any beneficiary of such Letter of Credit or any such transferee.  No Issuing Lender shall be liable for any
error, omission, interruption or delay in transmission, dispatch or delivery of
any message or advice, however transmitted, in connection with any Letter of
Credit, except for errors or omissions found by a final and nonappealable
decision of a court of competent jurisdiction to have resulted from the gross
negligence or willful misconduct of such Issuing Lender.  The Borrower agrees that any action taken or
omitted by any Issuing Lender under or in connection with any Letter of Credit
or the related drafts or documents, if done in the absence of gross negligence
or willful misconduct, shall be binding on the Borrower and shall not result in
any liability of such Issuing Lender to the Borrower.

 

3.12.                        Letter of Credit Payments.  If
any draft shall be presented for payment under any Letter of Credit, the
Issuing Lender that issued such Letter of Credit shall promptly

 

50

 

notify
the Borrower of the date and amount thereof. 
The responsibility of each Issuing Lender to the Borrower in connection
with any draft presented for payment under any Letter of Credit shall, in
addition to any payment obligation expressly provided for in such Letter of
Credit, be limited to determining that the documents (including each draft)
delivered under such Letter of Credit in connection with such presentment are
substantially in conformity with such Letter of Credit.

 

3.13.                        Applications.  To
the extent that any provision of any Application related to any Letter of
Credit is inconsistent with the relevant provisions of this Section 3, the
provisions of this Section 3 shall apply.

 

SECTION 4.  REPRESENTATIONS
AND WARRANTIES

 

To induce the Administrative Agent and the Lenders
to enter into this Agreement and to make the Loans and issue or participate in
the Letters of Credit, the Borrower hereby represents and warrants to the
Administrative Agent and each Lender that:

 

4.1.                              Organization; Power
and Authority.  The Borrower and each Group Member (a) is
duly organized, validly existing and in good standing under the laws of the
state of its organization and (b) has all requisite corporate or limited
liability company power and authority to own its property and assets, to lease
the property it operates as lessee and to carry on its business as now
conducted and as proposed to be conducted, and is qualified to do business, and
is in good standing, in every jurisdiction where such qualification is
required, except where the failure to have such power and authority and so to
qualify would not reasonably be expected to result in a Material Adverse
Effect.  Each Loan Party has the
corporate or limited liability company power to execute, deliver and perform
its obligations under each Loan Document to which it is a party, and each Loan
Party has the corporate or limited liability company power to take all action
necessary to consummate the transactions contemplated by the Loan Documents to
which it is a party.

 

4.2.                              Due Authorization.  Each
Loan Party has taken all necessary corporate or limited liability company
action to authorize the execution, delivery and performance of the Loan
Documents to which it is a party and, in the case of the Borrower, to authorize
the extensions of credit on the terms and conditions of this Agreement.  Each Loan Document has been duly executed and
delivered on behalf of each Loan Party party thereto. 

 

4.3.                              Governmental Approval. 
Except for (i) the Confirmation Order, (ii) the filings
referred to in Section 4.15, (iii) such consents, authorizations,
filings and notices which have been duly obtained or made and are in full force
and effect or (iv) as would not reasonably be expected to have a Material
Adverse Effect, no consent or authorization of, filing with, notice to or other
act by or in respect of, any Governmental Authority is required in connection
with the extensions of credit hereunder or with the execution, delivery,
performance by any Loan Party of, or the validity or enforceability of, this
Agreement or any of the Loan Documents (to which it is a party) or the conduct
by any Loan Party of its business (as conducted on the date this representation
is made or deemed made). The Borrower has delivered to the Administrative Agent
a complete and correct copy of the Plan of Reorganization, the Confirmation
Order and

 

51

 

Plan
Secured Notes, if any, including any amendments, supplements or modifications
with respect to any of the foregoing.

 

4.4.                              Binding and
Enforceable. This Agreement
constitutes, and each other Loan Document upon execution will constitute, a
legal, valid and binding obligation of each Loan Party party thereto,
enforceable against each such Loan party in accordance with its terms, except
as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors’ rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).

 

4.5.                              No Violation.  The
execution, delivery and performance by any Loan Party of this Agreement and the
other Loan Documents to which it is a party, the issuance of Letters of Credit,
the borrowings hereunder and the use of the proceeds thereof will not violate (i) its
organizational documents or (ii) in any manner which has had or would
reasonably be expected to have a Material Adverse Effect, any Requirement of
Law or any Contractual Obligation of such Loan Party.

 

4.6.                              No Default.  No
Default or Event of Default has occurred and is continuing, other than any
Default or Event of Default which has been waived pursuant to Section 11.1.  As of the Closing Date, no Group Member is in
default (and, for purposes of making this representation on any date after the
Closing Date, has not been in default for more than 45 days) in any material
respect under or with respect to any of its material Contractual Obligations
(other than in respect of Debt) that, in the aggregate with other such
defaults, would reasonably be expected to have a Material Adverse Effect.

 

4.7.                              Litigation.  No
litigation, investigation, arbitration, or administrative proceeding is
currently pending or, to the Borrower’s knowledge, threatened against it or any
Restricted Subsidiary or against any of their respective properties or revenues
(i) to restrain the entry by any Loan Party into, the enforcement of or
exercise of any rights by the Lenders or the Administrative Agent under, or the
performance or compliance by any Loan Party with any obligations under, the
Loan Documents to which it is a party or (ii) which has had or would
reasonably be expected to have a Material Adverse Effect.

 

4.8.                              Financial Condition.  The
unaudited pro forma consolidated balance sheet of the Borrower and its
consolidated Subsidiaries as at December 31, 2004 and the related pro
forma consolidated statement of income for the fiscal year then ended
(including the notes thereto), copies of which have heretofore been delivered
to the Lenders, present fairly the pro forma consolidated financial condition
of the Borrower and its consolidated Subsidiaries as at said date and the pro
forma consolidated results of its operations for said fiscal year in accordance
with GAAP, excluding (i) the effects of “fresh start” accounting under SOP
90-7 and (ii) the issuance of securities and the incurrence of Debt
pursuant to the Plan of Reorganization. 
As of the Closing Date and except as would not reasonably be expected to
have a Material Adverse Effect, neither the Borrower nor any of its Subsidiaries
will have any material debt or Guarantee Obligations, contingent liabilities or
liabilities for taxes, or any long-term leases including any interest rate or
foreign currency swap or exchange transaction, that are not reflected in the
foregoing financial statements referred to in this Section 4.8, reflected
in the 

 

52

 

disclosure
statement for the Plan of Reorganization or otherwise expressly disclosed to
the Administrative Agent prior to the Closing Date.

 

4.9.                              Material Adverse
Change.  Since December 31, 2004, there has been
no material adverse change in the financial condition, operations, business or
Assets of the Borrower or its Subsidiaries, which would have a material adverse
effect on the ability of the Borrower to pay when due amounts owed by it from
time to time under this Agreement.

 

4.10.                        Investment Company Act;
Public Utility Holding Company Act.  No Loan Party is an “investment company”,
within the meaning of the Investment Company Act of 1940, as amended.  Prior to the effectiveness of the repeal of
the Public Utility Holding Company Act of 1935, as amended (“PUHCA”), no Loan
Party is a “holding company” or a “subsidiary company” of a “holding company”
as defined in PUHCA subject to any regulation under PUHCA restricting its
ability to incur Debt or execute or perform its obligations under the Loan
Documents to which it is a party.  No
Loan Party is subject to any regulation under the Federal Power Act restricting
its ability to incur Debt or execute or perform its obligations under the Loan
Documents to which it is a party.

 

4.11.                        Environmental Matters. 
There has been no matter with respect to environmental compliance which
has had or would reasonably be expected to have a Material Adverse Effect.

 

4.12.                        Accuracy of Information, etc.  No
statement or information contained in the Confidential Information Memorandum
(other than projections and pro  forma financial information) as
of the date of the Confidential Information Memorandum or as of the Closing
Date, contained any untrue statement of a material fact or omitted to state a
material fact necessary to make the statements contained herein or therein not
misleading in light of the circumstances under which such statements are made.  The projections and pro  forma
financial information contained in the Confidential Information Memorandum were
prepared in good faith based upon estimates and assumptions believed by
management of the Borrower to be reasonable at the time made, which are
believed by management to remain reasonable as of the Closing Date, it being
recognized by the Lenders that such financial information as it relates to
future events is not to be viewed as fact and that actual results during the
period or periods covered by such financial information may differ from the
projected results set forth therein by a material amount.

 

4.13.                        Employee Benefit Plans.  Each
Plan is in compliance in all material respects with the applicable provisions
of ERISA and the Code and the regulations and published interpretations
thereunder, except as would not result in a Material Adverse Effect.  No ERISA Event has occurred that, when taken
together with all other such ERISA Events, would result in a Material Adverse
Effect.

 

4.14.                        Tax Returns and Payments.  Each
of the Borrower and its Restricted Subsidiaries has filed or caused to be filed
with the appropriate taxing authorities, all Federal, state and other tax
returns, statements, forms and reports for taxes (the “Returns”) that
are required to be filed by or with respect to the income, property or
operations of the Borrower and/or any of its Restricted Subsidiaries and has
paid or caused to be paid, all taxes shown to be

 

53

 

due
and payable on said Returns (other than any the amount or validity of which is
currently being contested in good faith by appropriate proceedings and with
respect to which reserves in conformity with GAAP have been provided on the
books and records of the relevant entities), except where failure to take any
such action is excused by the filing of the Chapter 11 Cases or would not
reasonably be expected to have a Material Adverse Effect.

 

4.15.                        Security Documents.  (a) 
The Guarantee and Collateral Agreement is effective to create in favor of the
Administrative Agent, for the benefit of the Lenders, a legal, valid and
enforceable security interest in the Collateral described therein and proceeds
thereof.  In the case of the Pledged
Stock described in the Guarantee and Collateral Agreement, when stock
certificates representing such Pledged Stock are delivered to the
Administrative Agent, and in the case of the other Collateral described in the
Guarantee and Collateral Agreement, when financing statements and other filings
specified on Schedule 4.15(a) in appropriate form are filed in the
offices specified on Schedule 4.15(a), the Guarantee and Collateral
Agreement shall constitute a fully perfected Lien on, and security interest in,
all right, title and interest of the Loan Parties in such Collateral and the
proceeds thereof, as security for the Obligations (as defined in the Guarantee
and Collateral Agreement), in each case prior and superior in right to any
other Person (except, in the case of Collateral other than Pledged Stock, Liens
permitted by Section 8.3).

 

(b)                                 Each of the Mortgages is effective to
create in favor of the Administrative Agent, for the benefit of the Lenders, a
legal, valid and enforceable Lien on the Mortgaged Properties described therein
and proceeds thereof, and when the Mortgages are filed in the offices specified
on Schedule 4.15(b), each such Mortgage shall constitute a fully perfected
Lien on, and security interest in, all right, title and interest of the Loan
Parties in the Mortgaged Properties and the proceeds thereof, as security for
the Obligations (as defined in the relevant Mortgage), in each case prior in
right to any other Person other than Liens permitted by Section 8.3 and
those Persons claiming through exceptions shown on title.  Schedule 1.1B lists, as of the Closing
Date, each parcel of owned real property and each leasehold interest in real
property located in the United States and held by the Borrower or any of its
Subsidiaries.

 

4.16.                        Ownership of Property. 
Except as would not reasonably be expected to have a Material Adverse
Effect, the Borrower and each Restricted Subsidiary has good and marketable
title to, or a subsisting leasehold interest in or right to use, all material
items of real and personal property necessary for its operations free and clear
of all Liens, except as permitted by Section 8.3.

 

4.17.                        Labor Matters. 
Except as, in the aggregate, would not reasonably be expected to have a
Material Adverse Effect, there are no strikes against or other work stoppages by
employees of any Group Member pending. 

 

4.18.                        Subsidiaries.  Schedule 4.18
sets forth as of the Closing Date the name and jurisdiction of incorporation of
each Subsidiary and, as to each such Subsidiary, the percentage of each class
of Capital Stock owned by any Loan Party. 
The shares of Capital Stock or other ownership interests so indicated on
Schedule 4.18 are fully paid and non-assessable and are owned by such Loan
Party, directly or indirectly, free and clear of all Liens (other than as
permitted by Section 8.3).

 

54

 

SECTION 5.  CONDITIONS
PRECEDENT

 

5.1.                              Conditions to Initial
Extension of Credit.  The agreement of each Lender to make the
initial extension of credit requested to be made by it is subject to the
satisfaction, prior to or concurrently with the making of such extension of
credit on the Closing Date, of the following conditions precedent:

 

(a)                                  Credit Agreement; Guarantee and
Collateral Agreement.  The Administrative Agent shall have received (i) this
Agreement or, in the case of the Lenders, an Addendum, executed and delivered
by the Administrative Agent, the Borrower and each Person listed on Schedule 1.1A,
(ii) the Guarantee and Collateral Agreement, executed and delivered by the
Borrower and each Subsidiary Guarantor and (iii) an Acknowledgement and
Consent in the form attached to the Guarantee and Collateral Agreement,
executed and delivered by each Issuer (as defined therein) that is a Subsidiary
of the Borrower, if any, that is not a Loan Party.  

 

In the event that any one or
more Persons listed on Schedule 1.1A have not executed and delivered an
Addendum on the date scheduled to be the Closing Date (each such Person being
referred to herein as a “Non-Executing Person”), the condition referred
to in clause (i) above shall nevertheless be deemed satisfied if on such
date the Borrower and the Administrative Agent shall have designated one or
more Persons (the “Designated Lenders”) to assume, in the aggregate, all
of the Commitments that would have been held by the Non-Executing Persons
(subject to each such Designated Lender’s consent and its execution and
delivery of an Addendum).  Schedule 1.1A
shall automatically be deemed to be amended to reflect the respective
Commitments of the Designated Lenders and the omission of the Non-Executing
Persons as Lenders hereunder.

 

(b)                                 Closing Certificate; Certified
Certificate of Formation; Good Standing Certificates. 
The Administrative Agent shall have received (i) a certificate of
each Loan Party, dated the Closing Date, substantially in the form of Exhibit C,
with appropriate insertions and attachments, including the certificate of
incorporation of each Loan Party that is a corporation certified by the
relevant authority of the jurisdiction of organization of such Loan Party or
the certificate of formation and limited liability company agreement of each
Loan party that is a limited liability company, and (ii) a long form good
standing certificate for each Loan Party from its jurisdiction of organization
(where available).

 

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

 

(i)                                     the legal opinion of White & Case
LLP counsel to the Borrower and its Subsidiaries, substantially in the form of Exhibit F;
and

 

(ii)                                  the legal opinion of local counsel in each of
California, Texas, Michigan and Massachusetts and of such other special and
local counsel as may be required by the Administrative Agent.

 

55

 

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

 

(d)                                 Representations and Warranties. 
Each of the representation and warranties made by any Loan Party in or
pursuant to the Loan Documents shall be true and correct in all material
respects on and as of the Closing Date. 
No Default or Event of Default shall have occurred and be continuing on
the Closing Date or after giving effect to the extensions of credit requested
to be made on the Closing Date and the application of proceeds therefrom.

 

(e)                                  Fees.  The Lenders
and the Administrative Agent shall have received all fees required to be paid,
and all reasonable and documented expenses for which invoices have been presented
(including the reasonable fees and expenses of legal counsel), at least one (1) day
prior to the Closing Date.  All such
amounts will be paid with proceeds of Loans made on the Closing Date and will
be reflected in the funding instructions given by the Borrower to the
Administrative Agent on or before the Closing Date.

 

(f)                                    Plan of Reorganization.  (i) 
All conditions precedent to the confirmation of the Plan of Reorganization and
the Effective Date (as defined and described in the Plan of Reorganization) in
respect thereof shall have been met or waived (and the waiver thereof, if
material and adverse to the Lenders, shall have been consented to by the
Administrative Agent), (ii) each of the Effective Date and the substantial
consummation of the Plan of Reorganization shall have occurred and the Plan of
Reorganization, as confirmed by the Confirmation Order, shall be in full force
and effect and (iii) the Arrangers shall have received a certificate,
dated the Closing Date and signed by a financial officer of the Borrower,
confirming compliance with this condition. 
The Arrangers shall have received a certified copy of the Confirmation
Order and, except as would not reasonably be expected to have a Material
Adverse Effect, such Confirmation Order shall not have been reversed, modified,
stayed or amended or be the subject of a pending appeal and at least ten (10) days
shall have passed since the entry of the Confirmation Order.

 

(g)                                 Financial Statements. 
The Lenders shall have received (i) audited financial statements of
MAG for the 2002, 2003 and 2004 fiscal years, (ii) unaudited interim
consolidated financial statements of MAG for each quarterly period ended after
the latest fiscal year referred to in clause (i) above if such period ends
on a date falling 60 days or more prior to the Closing Date or is otherwise
available and such unaudited consolidated financial statements for the same
period of the prior fiscal year and (iii) as soon as available to
management, monthly financial data generated by MAG’s internal accounting
systems for use by senior and financial management for each month ended after
the latest fiscal quarter referred to in clause (ii) above

 

(h)                                 Pro Forma Balance Sheet. 
The Lenders shall have received a pro forma condensed combined balance
sheet of the Borrower and its Subsidiaries as at the date of the most recent
consolidated balance sheet delivered pursuant to Section 5.1(g) and a
pro forma condensed combined statement of operations for the year ended December 31,
2004, in each case adjusted to give effect to the consummation of the Plan of

 

56

 

Reorganization and
the financings contemplated hereby as if such transactions, with respect to the
pro forma balance sheet, had occurred on such date or with respect to the pro
forma statements of operations, had occurred on the first day of the year ended
December 31, 2004.

 

(i)                                     Environmental Assessment. 
ENVIRON shall have delivered an original copy of its environmental
report, dated September 2005 to the Administrative Agent, and such report
shall be reasonably satisfactory to the Administrative Agent.

 

(j)                                     Restructuring of Debt. 
The Administrative Agent shall have received evidence satisfactory to it
that substantially all of the existing Debt of the Borrower and its
Subsidiaries (other than Permitted Debt) shall have been repaid or restructured
as expressly contemplated in the Plan of Reorganization or otherwise on terms
satisfactory to the Administrative Agent. 

 

(k)                                  Lien Searches. 
The Administrative Agent shall have received the results of a recent
lien search in each of the jurisdictions where assets of the Loan Parties are
located, and such search shall reveal no liens on any of the assets of the Loan
Parties except for liens permitted by Section 8.3 or discharged on or
prior to the Closing Date pursuant to documentation satisfactory to the
Administrative Agent.

 

(l)                                     Pledged Stock; Stock Powers. 
The Administrative Agent shall have received the certificates
representing the shares of Capital Stock pledged pursuant to the Guarantee and
Collateral Agreement, together with an undated stock power for each such
certificate executed in blank by a duly authorized officer of the pledgor
thereof. 

 

(m)                               Filings, Registrations and Recordings. 
Each document (including any Uniform Commercial Code financing
statement) required by the Security Documents or under law or reasonably
requested by the Administrative Agent to be filed, registered or recorded in
order to create in favor of the Administrative Agent, for the benefit of the
Lenders, a perfected Lien on the Collateral described therein, prior and
superior in right to any other Person (other than with respect to Liens
expressly permitted by Section 8.3), shall be in proper form for filing,
registration or recordation.

 

(n)                                 Mortgages, etc. 
The Administrative Agent shall have received a Mortgage with respect to
each Mortgaged Property, executed and delivered by a duly authorized officer of
each party thereto.  The Administrative
Agent shall have received in respect of each Mortgaged Property a mortgagee’s
title insurance policy (or policies), and each such policy shall (i) be in
an amount satisfactory to the Administrative Agent, (ii) insure that the
Mortgage insured thereby creates a valid first Lien on such Mortgaged Property
free and clear of all Liens, defects and encumbrances, except for Liens
permitted by Section 8.3 or exceptions shown on title, (iii) be in
the form reasonably acceptable to the Administrative Agent, (iv) name the
Administrative Agent for the benefit of the Lenders as the insured thereunder
and (v) contain such endorsements and affirmative coverage as reasonably
required by the Administrative Agent.

 

57

 

(o)                                 MIRMA.  The Lenders
shall have received (i) certification from the Borrower that MIRMA is not
prohibited from making distributions or dividends as of the Closing Date and,
based upon financial projections of MIRMA and its Subsidiaries prepared in good
faith and based upon estimates and assumptions that the Borrower believes to be
reasonable at the time delivered, MIRMA is not projected to be prohibited from
making distributions and dividends during the term of the Loans (unless such
prohibition arises solely from the requirement under the Facility Lease
Documents with respect to MIRMA and its Subsidiaries that MIRMA and its
Subsidiaries deliver financial statements for the most recently completed
fiscal year or fiscal quarter, as the case may be, and the date of
determination is less than 90 or 60 days, as the case may be, from the end of
such fiscal year or fiscal quarter) and (ii) reasonably detailed
computations that demonstrate to the reasonable satisfaction of the Arrangers
compliance with any restrictions on restricted payments applicable to MIRMA.

 

5.2.                              Conditions to Each
Extension of Credit.  The agreement of each Lender to make any
extension of credit requested to be made by it on any date (including its
initial extension of credit) is subject to the satisfaction of the following
conditions precedent:

 

(a)                                  Representations and Warranties. 
Each of the representations and warranties made by any Loan Party in or
pursuant to the Loan Documents (other than those set forth in Sections 4.7, 4.9
and 4.12 of this Agreement) shall be true and correct in all material respects
on and as of such date as if made on and as of such date.

 

(b)                                 No Default.  No Default or
Event of Default shall have occurred and be continuing on such date or after
giving effect to the extensions of credit requested to be made on such date and
the application of proceeds therefrom.

 

Each
borrowing by and issuance of a Letter of Credit on behalf of the Borrower
hereunder shall constitute a representation and warranty by the Borrower as of
the date of such extension of credit that the conditions contained in this Section 5.2
have been satisfied.

 

SECTION 6.  AFFIRMATIVE
COVENANTS

 

The Borrower hereby agrees that, so long as the
Commitments remain in effect, any Letter of Credit remains outstanding or any
Loan or other amount is due and owing to any Lender or the Administrative Agent
hereunder:

 

6.1.                              Compliance with Law;
Maintenance of Existence.  (a)  Each Loan Party and its
Subsidiaries shall comply with all Requirements of Law (including Environmental
Laws) applicable to such Loan Party and such Subsidiaries in the conduct of
their respective businesses except to the extent that failure to comply
therewith would not reasonably be expected to have a Material Adverse Effect;
and (b) each Loan Party shall preserve, renew and keep in full force and
effect its organizational existence except as otherwise permitted by Section 8.4.

 

6.2.                              Financial Statements.  The
Borrower shall furnish to the Administrative Agent with copies for each Lender:

 

58

 

(a)                                  within the earlier of (x) ninety (90)
days after the end of each fiscal year of the Borrower (beginning with the
fiscal year ended December 31, 2005) and (y) five (5) Business Days
of the date on which such financial statements are filed with the SEC (the
Borrower shall be deemed to have delivered such financial statements if the
Borrower provides written notice (which may be in electronic form) of the
making or filing of any financial statements required in this clause (a) and
the same are continuously available on “EDGAR,” the Electronic Data Gathering
Analysis and Retrieval system of the SEC), a copy of the audited consolidated
balance sheet of the Borrower and its consolidated Subsidiaries as at the end
of such year and the related audited consolidated statements of income and of
cash flows for such year, certified by KPMG or other independent certified
public accountants of nationally recognized standing; and

 

(b)                                 within the earlier of (x) sixty (60) days
after the end of each fiscal quarter (other than the last fiscal quarter) of
each fiscal year of the Borrower (commencing with the fiscal quarter ending March 31,
2006) and (y) five (5) Business Days of the date on which such financial
statements are filed with the SEC (the Borrower shall be deemed to have
delivered such financial statements if the Borrower provides written notice
(which may be in electronic form) of the making or filing of any financial
statements required in this clause (b) and the same are continuously
available on “EDGAR,” the Electronic Data Gathering Analysis and Retrieval
system of the SEC), the unaudited consolidated balance sheet of the Borrower
and its consolidated Subsidiaries as at the end of such quarter, certified by a
Responsible Officer as being prepared in accordance with GAAP (subject to
normal year-end audit adjustments).

 

All such financial statements shall present fairly
the financial condition of the Borrower and its consolidated Subsidiaries and
shall be prepared in reasonable detail and in accordance with GAAP.

 

6.3.                              Certificates; Other
Information.  The Borrower shall furnish to the
Administrative Agent with copies for each Lender (or, in the case of clause
(c), to such Lender or, in the case of clause (d) and (e), to the
Administrative Agent):

 

(a)                                  concurrently with the delivery of any
financial statements pursuant to Section 6.2, in the case of quarterly or
annual financial statements, (i) a certificate of a Responsible Officer
stating that each Loan Party during such period has complied with the terms of
this Agreement and the other Loan Documents to which it is a party, and that
such Responsible Officer has obtained no knowledge of any Default or Event of
Default except as specified in such certificate (and if such certificate
specifies any Default or Event of Default has occurred, specifying the nature
and extent thereof and any corrective action taken or proposed to be taken with
respect thereto) and (ii) a Compliance Certificate containing all
information and calculations necessary for determining compliance by each Group
Member with the provisions of this Agreement referred to therein as of the last
day of the fiscal quarter or fiscal year of the Borrower, as the case may be;

 

(b)                                 as soon as available, and in any event no
later than sixty (60) days (or, in the case of the initial Projections
delivered after the fiscal year ended December 31, 2005,

 

59

 

ninety (90) days)
after the end of each fiscal year of the Borrower, a detailed consolidated
budget for the following fiscal year prepared on a quarterly basis (including a
projected consolidated balance sheet of the Borrower and its Subsidiaries as of
the end of the following fiscal year, the related consolidated statements of
projected cash flow, projected changes in financial position and projected
income and a description of the underlying assumptions applicable thereto)
(collectively, the “Projections”), which Projections shall in each case
be accompanied by a certificate of a Responsible Officer stating that such
Projections are prepared in good faith based on estimates, information and
assumptions that such Responsible Officer believes to be reasonable at the time
they are prepared;

 

(c)                                  promptly after the request by any Lender,
all documentation and other information that such Lender reasonably requests in
order to comply with its ongoing obligations under applicable “know your
customer” and anti-money laundering rules and regulations, including the
Uniting and Strengthening America by Providing Appropriate Tools Required to
Intercept and Obstruct Terrorism Act of 2001, as amended (the “USA PATRIOT
Act”); 

 

(d)                                 as soon as reasonably practicable, such
additional financial and other information relating to the then existing
financial condition of the Borrower and its Restricted Subsidiaries as the
Administrative Agent may from time to time reasonably request, subject to an
agreed upon confidentiality provision or except where the disclosure of such
information is prohibited by law or by regulatory requirement; and,

 

(e)                                  copies of compliance certificates in the
form of Exhibit GG to the Participation Agreements constituting Facility
Lease Documents required to be delivered thereunder, together with all
information delivered pursuant to Exhibit Three to Exhibit F to the
Plan of Reorganization that supports the calculations set forth in such
compliance certificates, at the times such compliance certificates and
information are required to be delivered under the Facility Lease Documents.

 

6.4.                              Notices. 
Within five (5) Business Days of a Responsible Officer obtaining
knowledge thereof, the Borrower shall give notice to the Administrative Agent
and each Lender of:

 

(a)                                  the occurrence of any Default or Event of
Default;

 

(b)                                 the occurrence of any ERISA Event that,
alone or together with any other ERISA Event, would result in a Material
Adverse Effect; 

 

(c)                                  any change in the Borrower’s S&P
Rating or Moody’s Rating; and

 

(d)                                 any litigation, investigation or
proceeding affecting any Loan Party that may exist at any time that would
reasonably be expected to have a Material Adverse Effect.

 

Each notice pursuant to this Section 6.4 (other
than clause (c)) shall be accompanied by a statement of a Responsible Officer
setting forth details of the occurrence

 

60

 

referred
to therein and stating what action the relevant Group Member or other
Subsidiary of the Borrower proposes to take with respect thereto.

 

6.5.                              Inspection.  The
Borrower shall permit the Administrative Agent or any other Lender or any
agents or representatives thereof (at the expense of the Administrative Agent
and/or such Lender unless an Event of Default has occurred and is continuing),
to examine and make copies of and abstracts from records and books of, and
visit the properties of, the Borrower to discuss the affairs, finances and
accounts of the Borrower with any of its officers or directors and with its
independent certified public accountants (in the presence of the Borrower) from
time to time during normal business hours upon reasonable notice.  The Administrative Agent agrees to coordinate
and consolidate visits pursuant to this Section 6.5 by Lenders and their
agents and representatives (including the examination of books and records and
the making of copies and abstracts of books and records) at mutually convenient
times and in such a manner so as to cause minimum disruption to the operations
of the Borrower and to minimize costs associated with such visits. 

 

6.6.                              Maintenance of
Property; Insurance.  The Borrower shall, and shall cause each
Restricted Subsidiary to (a) keep all material property useful and
necessary in its business in good working order and condition, ordinary wear
and tear excepted except (x) if in the good faith business judgment of the
Borrower it is in its economic interest not to preserve and maintain such
property or (y) the failure to do so would not reasonably be expected to have a
Material Adverse Effect and (b) maintain with financially sound and
reputable insurance companies insurance on all its property in at least such
amounts and against at least such risks as are usually insured against in the
same general area by companies engaged in the same or a similar business to the
extent available on commercially reasonable terms.

 

6.7.                              Subsequent Acquired
Property; New Subsidiaries.  (a)  The Borrower shall with respect to
any material property acquired after the Closing Date by any Loan Party (other
than (x) any property described in paragraph (b), (c) or (d) below,
(y) any property subject to a Lien expressly permitted by Section 8.3(c), (f) and
(g), and in which and to the extent that the Administrative Agent is prohibited
from taking a security interest by the terms of the agreement imposing such
Lien and (z) property acquired by any Excluded Foreign Subsidiary) as to which
the Administrative Agent, for the benefit of the Lenders, does not have a
perfected Lien, promptly (i) execute and deliver to the Administrative
Agent such amendments to the Guarantee and Collateral Agreement or such other
documents as the Administrative Agent reasonably deems necessary or advisable
to grant to the Administrative Agent, for the benefit of the Lenders, a
security interest in such property and (ii) take all actions necessary or
advisable to grant to the Administrative Agent, for the benefit of the Lenders,
a perfected first priority security interest in such property, including the
filing of Uniform Commercial Code financing statements in such jurisdictions as
may be required by the Guarantee and Collateral Agreement or by law or as may
be requested by the Administrative Agent; provided that the Borrower and
its Subsidiaries shall not be required (A) to perfect the security
interests in deposits and investment accounts by entering into separate lockbox
or account control agreements; (B) to perfect any security interest in
motor vehicles or (C) to perfect any security interests in any Collateral
(other than Capital Stock of Subsidiaries) by possession except as otherwise
agreed or required pursuant to the Loan Documents.

 

61

 

(b)                                 The Borrower shall with respect to any
fee interest in any real property having a value (together with improvements
thereof) of at least $25,000,000 (i) acquired after the Closing Date by
the Borrower or any Subsidiary Guarantor or (ii) owned by any Subsidiary
that becomes a Subsidiary Guarantor after the Closing Date (other than (x) any
such real property subject to a Lien expressly permitted by Section 8.3
and (y) real property acquired by any Excluded Foreign Subsidiary), promptly (1) execute
and deliver a first priority Mortgage, in favor of the Administrative Agent,
for the benefit of the Lenders, covering such real property, which in the case
of each of: (A) the Hydros (Rio, Mongap and Swingline Bridge) including
Hillburn Generating Plant; (B) Lovett Generating Plant; and (C) Bowline
Generating Plant (including West Haverstraw) shall be “capped” at $10,000,000
each, (2) if reasonably requested by the Administrative Agent, provide the
Lenders with title and extended coverage insurance covering such real property
in an amount at least equal to the purchase price of such real property (or
such other amount as shall be reasonably specified by the Administrative Agent;
provided, however, that the Borrower shall be required to deliver title
policies for the following properties only in the amount of $10,000,000
each:  (i) the Hydros (Rio, Mongap
and Swinging Bridge), including Hillburn Generating Plant; (ii) Lovett
Generating Plant; and (iii) Bowline Generating Plant (including West
Haverstraw) and otherwise conforming to the requirements set forth in Section 5.1(n)
and (3) if requested by the Administrative Agent, deliver to the
Administrative Agent legal opinions related to the matters described above,
which opinions shall be in form and substance, and from counsel, reasonably
satisfactory to the Administrative Agent. 

 

(c)                                  If any additional Subsidiary is formed or
acquired after the Closing Date or any Subsidiary ceases to be an Unrestricted
Subsidiary, the Borrower shall promptly notify the Administrative Agent
thereof.  The Borrower shall with respect
to any new Subsidiary (other than an Excluded Foreign Subsidiary or a new
Subsidiary substantially all of the Assets and the Capital Stock of which are
subject to Liens permitted by Section 8.3) created or acquired after the
Closing Date by any Group Member (which, for the purposes of this paragraph
(c), shall include (x) any existing Subsidiary that ceases to be an Excluded
Foreign Subsidiary and (y) any existing Subsidiary that is no longer an
Unrestricted Subsidiary), promptly (i) execute and deliver to the
Administrative Agent such amendments to the Guarantee and Collateral Agreement
as the Administrative Agent deems necessary or advisable to grant to the
Administrative Agent, for the benefit of the Lenders, a perfected first
priority security interest in the Capital Stock of such new Subsidiary that is
owned by any Group Member, (ii) deliver to the Administrative Agent the
certificates representing such Capital Stock, together with undated stock
powers, in blank, executed and delivered by a duly authorized officer of the
relevant Group Member, and (iii) if such new Subsidiary is a Restricted
Subsidiary (other than any new Subsidiary of MIRMA, MET, or New MAEM Holdco,
LLC), cause such new Restricted Subsidiary (A) to become a party to the
Guarantee and Collateral Agreement as a Subsidiary Guarantor, (B) to take
such actions necessary or advisable to grant to the Administrative Agent for
the benefit of the Lenders a perfected first priority security interest in the
Collateral described in the Guarantee and Collateral Agreement with respect to
such new Restricted Subsidiary, including the filing of Uniform Commercial Code
financing statements in such jurisdictions as may be required by the Guarantee
and Collateral Agreement or by law or as may be reasonably requested by the
Administrative Agent and (C) to deliver to the Administrative Agent a
certificate of such Subsidiary, substantially in the form of Exhibit C,
with appropriate insertions and attachments.

 

62

 

(d)                                 With respect to any new Excluded Foreign
Subsidiary created or acquired after the Closing Date by any Group Member
(other than by any Group Member that is an Excluded Foreign Subsidiary),
promptly (i) execute and deliver to the Administrative Agent such
amendments to the Guarantee and Collateral Agreement as the Administrative
Agent deems necessary or advisable to grant to the Administrative Agent, for
the benefit of the Lenders, a perfected first priority security interest in the
Capital Stock of such new Subsidiary that is owned by any such Group Member
(provided that in no event shall more than 66% of the total outstanding voting Capital
Stock of any such new Subsidiary be required to be so pledged), (ii) deliver
to the Administrative Agent the certificates representing such Capital Stock,
together with undated stock powers, in blank, executed and delivered by a duly
authorized officer of the relevant Group Member, and take such other action as
may be necessary or, in the opinion of the Administrative Agent, desirable to
perfect the Administrative Agent’s security interest therein, and (iii) if
requested by the Administrative Agent, deliver to the Administrative Agent
legal opinions relating to the matters described above, which opinions shall be
in form and substance, and from counsel, reasonably satisfactory to the
Administrative Agent.

 

(e)                                  The Borrower shall promptly (i) notify
the Administrative Agent in writing of the designation of any Subsidiary as an “Unrestricted
Subsidiary” and (ii) deliver to the Administrative Agent a certificate
signed by a Responsible Officer certifying that such designation complied with
the conditions set forth in the definition of “Unrestricted Subsidiary”.

 

6.8.                              Collateral Information.  The
Borrower shall, and shall cause each Restricted Subsidiary to, furnish to the
Administrative Agent prompt written notice of any change (i) in any Loan
Party’s corporate name, (ii) in the jurisdiction of organization or
formation or the location of the chief executive office or sole place of
business or principal residence of any Loan Party from that referred to in Section 4.2
of the Guarantee and Collateral Agreement, or (iii) in any Loan Party’s
Federal Taxpayer Identification Number. The Borrower agrees not to effect or
permit any change referred to in the preceding sentence unless all filings have
been made under the Uniform Commercial Code or otherwise that are required in
order for the Administrative Agent to continue at all times following such
change to have a valid, legal and perfected security interest in all of the
Collateral.

 

6.9.                              Further Assurances.  The
Borrower shall, and shall cause each Restricted Subsidiary to, execute any and
all further documents, financing statements, agreements and instruments, and
take all further action (including filing Uniform Commercial Code and other
financing statements, mortgages and deeds of trust and delivering to the Administrative
Agent certificates representing securities pledged under the Security
Documents) that may be required under applicable law, or that the Majority
Lenders or the Administrative Agent may reasonably request, in order to grant,
preserve, protect and perfect the validity and priority of the security
interests created or intended to be created by the Security Documents.

 

6.10.                        Use of Proceeds. The Borrower shall deposit $200,000,000 of
the proceeds of the Term Loans made on the Closing Date in the Synthetic L/C
Deposit Account in accordance with Section 3.8(b).  The remaining proceeds of the Loans and the
Letters of Credit shall be used for general corporate purposes.  No part of the proceeds of any Loans or other
extension of credit under this Agreement, shall be used for any purpose that
violates the provisions of Regulation U of the Board.  If requested by any Lender or the
Administrative

 

63

 

Agent,
the Borrower shall furnish to the Administrative Agent and each Lender a
statement to the foregoing effect in conformity with the requirements of FR Form G-3
or FR Form U-1, as applicable, referred to in Regulation U.

 

SECTION 7.  FINANCIAL
COVENANTS

 

The Borrower hereby agrees that, so long as the
Commitments remain in effect, any Letter of Credit remains outstanding or any
Loan or other amount is due and owing to any Lender or the Administrative Agent
hereunder:

 

7.1.                              Interest Coverage
Ratio.  The Borrower shall not permit the Interest
Coverage Ratio for any period of four consecutive fiscal quarters of the
Borrower (including the fourth fiscal quarter) (or, if less than four fiscal
quarters have ended since the Closing Date, the number of full fiscal quarters
commencing with the fiscal quarter ending March 31, 2006) to be less than
2.0 to 1.0. 

 

7.2.                              Leverage Ratio.  The
Borrower shall not permit the Leverage Ratio as at the last day of any period
of four consecutive fiscal quarters of the Borrower (including the fourth
fiscal quarter) to exceed 6.0 to 1.0 (or, if less than four fiscal quarters
have ended since the Closing Date, EBITDA for the relevant period shall be
deemed to equal EBITDA for the one, two or three immediately preceding
completed fiscal quarters commencing with the fiscal quarter ending March 31,
2006, multiplied by 4, 2 and 4/3 respectively). 

 

7.3.                              Capital Expenditures.  The
Borrower shall not, and shall not permit any Restricted Subsidiary to, make
Capital Expenditures during any fiscal year of the Borrower (not including any
amount of (i) Environmental Capital Expenditures and other Capital
Expenditures made to comply with Requirements of Law, (ii) Capital
Expenditures incurred under long-term service agreements or (iii) without
duplication, Capital Expenditures financed with Debt referred to in clauses (iv) and
(v) of the definition of Permitted Debt or from Net Cash Proceeds from
Asset Sales, Recovery Events or from the proceeds of equity contributions or
Affiliate Subordinated Debt) exceeding $200,000,000 in the aggregate for the
Borrower and its Restricted Subsidiaries; provided, that (a) any
such amount referred to above, if not so expended in the fiscal year for which
it is permitted, may be carried over for expenditure in the next succeeding
fiscal year, and (b) the Borrower shall be permitted to increase the
permitted amount of Capital Expenditures in any fiscal year by reducing such
permitted amount with respect to the next succeeding fiscal year by an amount
equal to such increase.  For purposes of
determining any carry-over amount pursuant to clause (a) of the proviso
above, Capital Expenditures made pursuant to this Section during any
fiscal year shall be deemed made first, in respect of amounts permitted for
such fiscal year as provided above and second, in respect of amounts carried
over from the prior fiscal year pursuant to such clause (a).

 

7.4.                              Notwithstanding any financial covenant set forth above in Sections 7.1,
7.2 and 7.3 in this Section 7, if the Borrower’s Moody’s Rating is not
less than Baa3 and the Borrower’s S&P rating is not less than BBB- , in
each case with a stable or better outlook, such financial covenants shall be
deemed replaced with the following for so long as such ratings are maintained
(without regard to outlook):

 

64

 

(a)                                  Capitalization Ratio. 
The Borrower shall not permit the ratio of (i) Consolidated Total
Debt to (ii) Consolidated Capitalization for any period of four
consecutive fiscal quarters of the Borrower (including the fourth fiscal
quarter) to be greater than 0.65 to 1.0; and 

 

(b)                                 Interest Coverage Ratio. 
The Borrower shall not permit the Interest Coverage Ratio for any period
of four consecutive fiscal quarters of the Borrower (including the fourth
fiscal quarter) to be less than 2.5 to 1.0.

 

SECTION 8.  NEGATIVE
COVENANTS

 

The Borrower hereby agrees that, so long as the
Commitments remain in effect, any Letter of Credit remains outstanding or any
Loan or other amount is due and owing to any Lender or the Administrative Agent
hereunder (provided that if the Borrower’s Moody’s Rating is not less
than Baa3 and the Borrower’s S&P Rating is not less than BBB-, in each case
with a stable or better outlook, Section 8.1, 8.2, 8.5 and 8.6 below shall
not be effective so long as such ratings are maintained (without regard to
outlook)): 

 

8.1.                              Debt.  The
Borrower shall not, and shall not permit any Restricted Subsidiary to, create,
issue, incur, assume, become liable in respect of or suffer to exist any Debt,
except Permitted Debt; unless, in the case of the Borrower or any
Subsidiary Guarantor only, at the end of the fiscal quarter (including the
fourth fiscal quarter) of the Borrower for which financial statements have been
delivered to the Administrative Agent immediately preceding the date on which
such Debt is incurred, the Leverage Ratio was less than 4.0 to 1.0, calculated,
in the case of EBITDA, on a rolling four fiscal quarter basis ending on the
last day of such fiscal quarter and giving pro forma effect to the incurrence
of such Debt as of the first date of such period (or, if at such time less than
four fiscal quarters have ended since the Closing Date, EBITDA shall be
calculated as EBITDA for one, two or three immediately preceding completed
fiscal quarters commencing with the fiscal quarter ending March 31, 2006,
multiplied by 4, 2 and 4/3 respectively).

 

8.2.                              Restricted Payments.  The
Borrower shall not, and shall not permit any Restricted Subsidiary, to (i) declare
or make any dividend payment or other distribution of assets, properties, cash,
rights, obligations or securities on account of any shares of any class of
Capital Stock of the Borrower or such Restricted Subsidiary, (ii) make any
payments with respect to Affiliate Subordinated Debt or make any redemption or
repurchase of any Affiliate Subordinated Debt or (iii) purchase, redeem or
otherwise acquire for value any shares of any class of Capital Stock of the
Borrower or Restricted Subsidiary or any warrants, rights or options to acquire
any such shares, now or hereafter outstanding, or reduce its capital (each, a “Restricted
Payment”); provided, however, that the Borrower may, and may
permit its Restricted Subsidiaries to (w) declare and pay dividends and other
distributions within five (5) Business Days of the Closing Date, as
contemplated by the Plan of Reorganization, in an amount not to exceed
$250,000,000, (x) declare and make any dividend payment or other
distribution payable in Common Stock of the Borrower, (y) with respect to
any Restricted Subsidiary, declare and make any dividend payment or other
distribution (A) payable to the Borrower or any Restricted Subsidiary, or (B) where
the Borrower or the Restricted Subsidiary which owns the Capital Stock in the
payor receives at least its proportionate share thereof (after giving effect to
the relative rights and

 

65

 

preferences
of the various classes of Capital Stock of such payor), and (z) with
respect to the Borrower, if there is no Default or Event of Default and none
would result therefrom, take action specified in clause (i), (ii) and (iii) above
(I) if, at the end of the fiscal quarter (including the fourth fiscal quarter)
of the Borrower for which financial statements have been delivered to the
Administrative Agent, most recently preceding the date on which the Borrower
takes such action, the Interest Coverage Ratio was at least 3.0 to 1.0,
calculated on a rolling four fiscal quarter basis ending on the date of such
financial statements and with effect from the date of such delivery of such
financial statements (or, if at such time less than four fiscal quarters have
ended since the Closing Date, the immediately preceding fiscal quarters
commencing with the fiscal quarter ending March 31, 2006), and the
aggregate amount of payments made under this clause (z) of this Section 8.2
since the Closing Date (including the contemplated Restricted Payment and under
clause (II) of this Section 8.2) is less than the sum of (a) 100% of
cash on hand on the Closing Date (after giving effect to all cash payments and
distributions made or to be made pursuant to the Plan of Reorganization) plus (b) 100%
of Free Cash Flow since the Closing Date (less any amounts of Free Cash Flow
applied to prepay the Term Loans as required under Section 2.11) and (II)
in an amount equal to the amount of interest payable by MAG with respect to the
MAG Senior Notes within five (5) Business Days of such distribution or
dividend.

 

8.3.                              Liens.  The
Borrower shall not, and shall not permit any Restricted Subsidiary to, create, incur,
assume or suffer to exist any Lien upon any of its property, whether now owned
or hereafter acquired, except:

 

(a)                                  Liens arising solely by operation of law
or by order of a court or tribunal or other Governmental Authority (or by an
agreement of similar effect);

 

(b)                                 Liens arising in the ordinary course of
business or operations, in respect of overdue amounts which either (A) have
not been overdue for more than thirty (30) days or (B) are being contested
in good faith;

 

(c)                                  Liens securing Permitted Debt as
contemplated by the definition thereof;

 

(d)                                 Liens arising out of title retention or
like provisions in relation to the acquisition of goods or equipment acquired
in the ordinary course of business or operations and relating only to such
goods or equipment;

 

(e)                                  Liens on deposits to secure, or any Lien
otherwise securing, the performance of bids, trade contracts (other than for
borrowed money), leases, statutory obligations, surety bonds, appeal bonds,
performance bonds and other obligations of a like nature incurred in the
ordinary course of business;

 

(f)                                    Liens created or arising over any Asset
which is acquired, constructed or created by the Borrower or a Restricted
Subsidiary, but only if (x) such Lien secures only principal amounts (not
exceeding the cost of such acquisition, construction or creation) of Debt
incurred for the purposes of such acquisition, construction or creation,
together with any costs, expenses, interest and fees incurred in relation
thereto or a guarantee given in respect thereof, (y) such Lien is created or
arises on or before ninety (90) days after the

 

66

 

completion of such
acquisition, construction or creation and (z) such Lien is confined solely to
the property so acquired, constructed or created;

 

(g)                                 Liens (x) outstanding on or over any
Asset acquired after the date hereof, (y) in existence at the date of such
acquisition and (z) where the Borrower does not take any step to increase the
principal amount secured thereby from that so secured and outstanding at the
time of such acquisition (other than in the case of Liens for a fluctuating
balance facility, by way of utilization of that facility within the limits
applicable thereto at the time of acquisition);

 

(h)                                 Liens constituted by a right of set off
or rights over a margin call account or any form of cash collateral and letters
of credit or any similar arrangement for obligations incurred in respect of any
agreement for the sale of, or the hedging or management of risks with respect
to, electric energy or capacity, commodities, currency or interest rates, which
arrangement was entered into on arm’s-length, commercial terms;

 

(i)                                     (x) Liens in favor of counterparties to
any PPA or FSA (other than Affiliates of the Borrower) that are junior to the
Liens created by the Security Documents pursuant to an agreement in the form of
Exhibit I or otherwise on terms reasonably satisfactory to the
Administrative Agent; (y) Step-In Rights; and (z) Liens in favor of
counterparties to any PPA or FSA (other than Affiliates of the Borrower) that
are pari  passu with the Liens securing the Obligations and are
granted solely to secure the obligations of the Borrower or any Restricted
Subsidiary under such PPA or FSA, which in the aggregate for the Borrower and
its Restricted Subsidiaries do not exceed at any time outstanding $100,000,000,
provided that (1) the Lien is limited to the Assets of the Borrower
or Restricted Subsidiary specific to its performance under the PPA or FSA, as
the case may be, secured by such Assets and (2) the obligations secured by
each such Lien are structured so that the counterparty’s credit exposure and
actual or projected mark-to market exposure to the Borrower or Restricted
Subsidiary, as the case may be, is positively correlated with power prices;

 

(j)                                     Liens in favor of a plaintiff or
defendant in any action before a court or tribunal as security for costs or
expenses where such action is being prosecuted or defended in the bona fide
interest of the Borrower;

 

(k)                                  Liens described in any of clauses (d) through
(g) above or clauses (l) and (m) below which are renewed or extended upon
the renewal or extension or refinancing or replacement of the Debt secured
thereby, provided that there is no increase in the principal amount of
the Debt secured thereby over the principal, capital or nominal amount thereof
(plus any accrued interest and prepayment premium) outstanding immediately
prior to such refinancing;

 

(l)                                     Liens existing on the date hereof and
listed on Schedule 8.3(l),  provided
that no such Lien is spread to cover any additional property after the Closing
Date and that the amount of the obligations secured thereby is not increased;

 

67

 

(m)                               Liens on the property of a Person
existing at the time such Person is merged into or consolidated with, or
acquired by, the Borrower or a Restricted Subsidiary thereof and not incurred
in contemplation with such merger, consolidation or acquisition;

 

(n)                                 Liens created pursuant to the Security
Documents; 

 

(o)                                 pledges or deposits in connection with
workers’ compensation, unemployment insurance and other social security
legislation;

 

(p)                                 Liens for taxes not yet due or that are
being contested in good faith by appropriate proceedings, provided that
adequate reserves with respect thereto are maintained on the books and records
of the Borrower or its Restricted Subsidiaries, as the case may be, in
conformity with GAAP; 

 

(q)                                 Liens securing Debt or other obligations
not exceeding $50,000,000 at any one time outstanding;

 

(r)                                    any interest or title of a lessor under
any lease entered into by the Borrower or any other Subsidiary in the ordinary
course of its business and covering only the assets so leased; and

 

(s)                                  any interest or title of a lessor whether
by statute, common-law or by virtue of a lease entered into by the Borrower or
any Subsidiary in the ordinary course of its business and covering the property
of the Borrower or any such Subsidiary located in, at or on the leased
premises.

 

8.4.                              Mergers.  The
Borrower will not, and will not permit any Restricted Subsidiary to, enter into
any merger, consolidation or amalgamation, or liquidate, wind up or dissolve
itself (or suffer any liquidation or dissolution), or Dispose of all or
substantially all of its property or business, except that:

 

(a)                                  any Loan Party may merge, consolidate or
amalgamate with, or dispose of all or substantially all of its property or
business to, another Loan Party or any Person which, immediately following such
transaction, shall be a Loan Party;

 

(b)                                 any Restricted Subsidiary (other than a
Subsidiary Guarantor) may merge, consolidate or amalgamate with, or dispose of
all or substantially all of its property or business to, the Borrower or any
other Restricted Subsidiary;

 

(c)                                  any Loan Party may dispose of all or
substantially all of its property or business in a transaction which does not
violate Section 8.5; and

 

(d)                                 any Restricted Subsidiary may liquidate,
wind-up or dissolve itself into another Restricted Subsidiary or the Borrower.

 

8.5.                              Asset Sales.  The
Borrower will not, and will not permit any Restricted Subsidiary to, conduct
any Asset Sale other than the sale or disposition of Assets for which 75% of
the consideration received (excluding any Debt of any such Restricted
Subsidiary assumed in

 

68

 

connection
with any such sale or Disposition) is in cash (which, for purposes of this Section 8.5,
shall include liabilities, securities, notes or other obligations received by
the Borrower or any Restricted Subsidiary that are convertible into cash (and
are so converted within 180 days after the completion of the Asset Sale) and
certain replacement and other capital assets and operating assets received by
the Borrower or any Restricted Subsidiary); provided that prior to the
execution of a legally binding agreement to consummate (A) any Asset Sale
which shall relate to Assets with a fair market value in excess of $150,000,000
or (B) if the fair market value of all Assets sold, transferred, leased or
disposed of pursuant to this paragraph shall exceed $150,000,000 in any fiscal
year, each Asset Sale thereafter during such fiscal year, the Borrower shall
have received written confirmation from each of S&P and Moody’s that the
credit ratings assigned by such entities to the Loans shall be no lower than
such ratings assigned by S&P and Moody’s, as the case may be, to the Loans
immediately prior to the time that S&P and Moody’s, as the case may be,
shall have become aware of such proposed Asset Sale, the use of the proceeds
thereof and all transactions related thereto, in each case after giving effect
to such Asset Sale, the use of the proceeds thereof and all transactions
related thereto.

 

8.6.                              Investments.  The
Borrower will not, and will not permit any Restricted Subsidiary to, make any
advance, loan, extension of credit (by way of guaranty or otherwise) or capital
contribution to, or purchase any Capital Stock, bonds, notes, debentures or
other debt securities of, any Person (all of the foregoing, “Investments”),
except:

 

(a)                                  extensions of trade credit in the
ordinary course of business;

 

(b)                                 Investments in cash and Cash Equivalents;

 

(c)                                  Guarantee Obligations of Permitted Debt; 

 

(d)                                 loans and advances to employees of the
Borrower or any Subsidiary in the ordinary course of business (including for
travel, entertainment and relocation expenses); 

 

(e)                                  Investments in Assets useful in the
business of the Borrower and its Restricted Subsidiaries made by the Borrower
or any of its Restricted Subsidiaries with the Net Cash Proceeds of any
Recovery Event or Asset Sale;

 

(f)                                    Investments which constitute proceeds of
any permitted Disposition;

 

(g)                                 Investments by the Borrower or any
Restricted Subsidiary in the Borrower, any Subsidiary Guarantor, MET or MIRMA; provided,
that such Investment made in MET or MIRMA pursuant to this clause (g) shall
not take the form of a contribution of Assets, other than cash or Capital Stock
of any Person;

 

(h)                                 any acquisition of Assets or Capital
Stock solely in exchange for the issuance of equity interests (other than
Disqualified Stock) of the Borrower;

 

(i)                                     Investments represented by obligations
under Hedging Arrangements;

 

(j)                                     any Investment in a Person, if as a
result of such Investment, such Person is merged, consolidated or amalgamated
with or into, or transfers or conveys substantially

 

69

 

all of its assets
to, or is liquidated into, the Borrower or a Restricted Subsidiary of the
Borrower or will immediately following such Investment be a Restricted
Subsidiary; provided that the Borrower and its Restricted Subsidiaries
shall maintain minimum liquidity (defined as availability under this Agreement
plus cash and Cash Equivalents of the Loan Parties on hand not subject to any
Lien (other than the Lien created under the Security Documents) and cash and
Cash Equivalents of the Borrower’s Restricted Subsidiaries which are not Loan
Parties that are then distributable to a Loan Party) of at least $250,000,000
on a pro  forma basis after giving effect to the consummation of
such Investment and any permitted financing thereof;

 

(k)                                  any Investments received (i) in
compromise or resolution of obligations of trade creditors or customers that
were incurred in the ordinary course of business of the Borrower or any of its
Restricted Subsidiaries, including (A) obligations of financially troubled
account debtors to the extent reasonably necessary in order to prevent or limit
loss and (B) pursuant to any plan of reorganization or similar arrangement
upon the bankruptcy or insolvency of any trade creditor or customer, (ii) in
compromise or resolution of litigation, arbitration or other disputes, or (iii) on
account of any claim against, or an interest in, any other Person (A) acquired
in good faith in connection with or as a result of a bankruptcy, workout,
reorganization or recapitalization of such other Person or (B) as a result
of a bona fide foreclosure by the Borrower or any of its Restricted
Subsidiaries with respect to any claim against any other Person;

 

(l)                                     any Investment existing or committed to
on the date hereof and listed on Schedule 8.6(l);

 

(m)                               Investments in the form of, or pursuant
to, working interests, royalty interests, mineral leases, processing
agreements, farm-out agreements, contracts for the sale, transportation
or exchange of oil and natural gas, unitization agreements, pooling agreements,
area of mutual interest agreements, production sharing agreements or other
similar or customary agreements, transactions, properties, interests or
arrangements, and Investments and expenditures in connection therewith or
pursuant thereto, in each case, made or entered into in the ordinary course of
business; and

 

(n)                                 in addition to Investments otherwise
expressly permitted by this Section, Investments by the Borrower or any of its
Restricted Subsidiaries in an aggregate amount (valued at cost) not to exceed
$75,000,000 at any time outstanding.

 

8.7.                              Transactions with
Affiliates.  The Borrower shall not, and shall not permit
any Restricted Subsidiary to, enter into any transaction, including any
purchase, sale, lease or exchange of property, the rendering of any service or
the payment of any management, advisory or similar fees, with any Affiliate
(other than the Borrower or any Restricted Subsidiary) unless such transaction
is (a) otherwise permitted under this Agreement, and (b) is either
(w) pursuant to agreements set forth in Schedule 8.7, as such agreements
may be amended, modified, supplemented, extended or renewed, provided
that any future amendment, modification, supplement, extension or renewal of
any such agreement entered into after the Closing Date will be permitted to the
extent that its terms are not more disadvantageous in any material respect to
the Lenders than the terms of such agreement in effect on the Closing Date, (x)
upon fair and

 

70

 

reasonable
terms no less favorable to the Borrower or such Restricted Subsidiary, as the
case may be, than it would obtain in a comparable arm’s length transaction with
a Person that is not an Affiliate, (y) structured as a commercially reasonable
and fair allocation of costs, including corporate overhead costs, or (z) is
disclosed in the Plan of Reorganization. 

 

8.8.                              Sales and Leasebacks.  The
Borrower shall not, and shall not permit any Restricted Subsidiary to, enter
into any arrangement with any Person providing for the leasing by the Borrower
or any Restricted Subsidiary of real or personal property that has been or is
to be sold or transferred by the Borrower or such Restricted Subsidiary to such
Person or to any other Person to whom funds have been or are to be advanced by
such Person on the security of such property or rental obligations of the
Borrower or such Restricted Subsidiary except to the extent that the sale of
the relevant property is permitted under Section 8.5 and such lease, if
treated as a Lien and Debt, does not violate Sections 8.1 or 8.3.

 

8.9.                              Changes in Fiscal
Periods.  The Borrower shall not change its fiscal year
to end on a day other than December 31 or change its method of determining
fiscal quarters.

 

SECTION 9.  EVENTS
OF DEFAULT

 

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

 

(a)                                  the Borrower shall fail to pay any
principal of any Loan or Reimbursement Obligation when due in accordance with
the terms hereof; or the Borrower shall fail to pay any interest on any Loan or
Reimbursement Obligation, or any other amount payable hereunder or under any
other Loan Document, within five (5) Business Days after any such interest
or other amount becomes due in accordance with the terms hereof; or

 

(b)                                 (i)  any Loan Party shall default in
the observance or performance of any agreement contained in Section 6.4(a),
7 or 8 of this Agreement (other than Section 8.3) or (ii) any Loan
Party shall default in the observance or performance of any agreement contained
in Section 8.3, and such default shall continue unremedied for a period of
15 days after written notice to the Borrower from the Administrative Agent or
the Majority Lenders; or 

 

(c)                                  any representation or warranty made or
deemed made by any Loan Party herein or in any other Loan Document or in any
certificate, document or financial or other statement delivered or required to
be delivered pursuant hereto or thereto shall prove to have been inaccurate in
any material respect on or as of the date made or deemed made and in the case
of any representation or warranty made in any such certificate, document or
financial or other statement that does not refer to or incorporate by reference
any of the representations or warranties otherwise made or deemed made in any
Loan Document, such inaccuracy could reasonably be expected to have a Material
Adverse Effect; or

 

(d)                                 any Loan Party shall default in the
observance or performance in any material respect of any other agreement
contained in this Agreement or any other Loan Document (other than as provided
in paragraphs (a) through (c) of this Section), and such

 

71

 

default shall
continue unremedied for a period of 30 days after written notice to the
Borrower from the Administrative Agent or the Majority Lenders; or

 

(e)                                  The Borrower, any of its Restricted
Subsidiaries or New Mirant (subject in the case of New Mirant to there being
outstanding more than $100,000,000 of unfunded MAI Series A Preferred
Shares and MAI Series B Preferred Shares in the aggregate) shall fail to
pay any principal of or premium or interest on any Debt of such entity that is
outstanding in a principal or notional amount equal to or in excess of
$50,000,000, when the same becomes due and payable (whether by scheduled maturity,
required prepayment, acceleration, demand or otherwise), and such failure shall
continue after the applicable grace period, if any, specified in the agreement
or instrument relating to such Debt; or any other event shall occur or
condition shall exist under the agreement or instrument relating to any such
Debt and shall continue after the applicable grace period, if any, specified in
such agreement or instrument, if the effect of such event or condition is to
accelerate the maturity of such Debt by reason of default; or

 

(f)                                    Any judgment or order for the payment of
money in excess of $50,000,000 shall be rendered against the Borrower or any of
its material Restricted Subsidiaries and there shall be any period of sixty
(60) consecutive days during which a stay of enforcement of such judgment or
order, by reason of a pending appeal or otherwise, shall not be in effect; or

 

(g)                                 The Borrower, any of its material
Restricted Subsidiaries or New Mirant (subject in the case of New Mirant to
there being outstanding more than $100,000,000 of unfunded MAI Series A
Preferred Shares and MAI Series B Preferred Shares in the aggregate) (each
a “Designated Party”) shall (i) apply for or consent to the
appointment of, or the taking of possession by, a receiver, custodian, trustee
or liquidator of itself or of all or a substantial part of its property, (ii) make
a general assignment for the benefit of its creditors, (iii) commence a
voluntary case under the Bankruptcy Code (as now or hereafter in effect) or any
similar law of any applicable jurisdiction, (iv) file a petition seeking
to take advantage of any other law relating to bankruptcy, insolvency,
reorganization, winding-up, or composition or readjustment of debts, or (v) fail
to controvert in a timely and appropriate manner, or acquiesce in writing to,
any petition filed against it in an involuntary case under the Bankruptcy Code
or any similar law of any applicable jurisdiction; or a proceeding or case
shall be commenced, without the application or consent of such Designated
Party, in any court of competent jurisdiction, seeking (x) its liquidation,
reorganization, dissolution or winding up, or the composition or readjustment
of its debts, (y) the appointment of a trustee, receiver, custodian, liquidator
or the like of such Designated Party or of all or any substantial part of its
assets, or (z) similar relief in respect of such Designated Party under any law
relating to bankruptcy, insolvency, reorganization, winding-up, or composition
or adjustment of debts, and such proceeding or case shall continue unstayed and
in effect for a period of sixty (60) or more days; or

 

(h)                                 Except with the prior written consent of
the Majority Lenders, the MAI Series A Preferred Shares or the MAI Series B
Preferred Shares cease to be enforceable or rights of the holders thereof are
amended or waived; or

 

72

 

(i)                                     The Borrower ceases to be Controlled,
directly or indirectly, by New Mirant; or

 

(j)                                     (i) Any Security Document shall for
any reason be asserted in writing by the Borrower or any material Subsidiary
Guarantor not to be a legal, valid and binding obligation of any party thereto,
(ii) any security interest purported to be created by any Security
Document and to extend to assets that are material to the Borrower and its
Subsidiaries on a consolidated basis shall cease to be, or shall be asserted in
writing by the Borrower or any other Loan Party not to be, a valid and
perfected security interest (having the priority required by this Agreement or
the relevant Security Document) in the securities, assets or properties covered
thereby, except to the extent that any such loss of perfection or priority
results from the failure of the Administrative Agent to maintain possession of
certificates actually delivered to it representing securities pledged under the
Security Documents and except to the extent that such loss is covered by a
lender’s title insurance policy and the Administrative Agent shall be
reasonably satisfied with the credit of such insurer; or (iii) any
intercreditor agreement in respect of second-lien or subordinated indebtedness
shall for any reason be asserted in writing by the Borrower or any material
Subsidiary Guarantor not to be a legal, valid and binding obligation of any
party thereto or shall otherwise cease to be enforceable; or

 

(k)                                  the guarantee contained in Section 2
of the Guarantee and Collateral Agreement of any Subsidiary Guarantor that
holds material Assets shall cease, for any reason, to be in full force and
effect or any Loan Party shall so assert in writing; or

 

(l)                                     An ERISA Event shall occur and be
continuing that, when taken together with all other such ERISA Events, would
result in a Material Adverse Effect; or

 

(m)                               The Facility Leases shall have been
terminated pursuant to Section 18.1(b) of the Facility Lease (as
defined in the Facility Lease Documents).

 

then, and in any such event, (A) if such event
is an Event of Default specified in clause (i), (ii), (iii) or (iv) of
paragraph (g) above with respect to the Borrower, automatically the
Commitments shall immediately terminate and the Loans (with accrued interest
thereon) and all other amounts owing under this Agreement and the other Loan
Documents (including all amounts of Revolving L/C Obligations, whether or not
the beneficiaries of the then outstanding Revolving Letters of Credit shall
have presented the documents required thereunder) shall immediately become due
and payable, and (B) if such event is any other Event of Default, either
or both of the following actions may be taken: 
(i) with the consent of the Majority Lenders, the Administrative
Agent may, or upon the request of the Majority Lenders, the Administrative
Agent shall, by notice to the Borrower declare the Revolving Commitments to be
terminated forthwith, whereupon the Revolving Commitments shall immediately
terminate; and (ii) with the consent of the Majority Lenders, the
Administrative Agent may, or upon the request of the Majority Lenders, the
Administrative Agent shall, by notice to the Borrower, declare the Loans (with
accrued interest thereon) and all other amounts owing under this Agreement and
the other Loan Documents (including all amounts of Revolving L/C Obligations,
whether or not the beneficiaries of the then outstanding Revolving Letters of
Credit shall have presented the documents required thereunder) to be due and
payable forthwith, whereupon the same shall

 

73

 

immediately
become due and payable.  With respect to
all Letters of Credit with respect to which presentment for honor shall not
have occurred at the time of an acceleration pursuant to this paragraph, the
Borrower shall at such time deposit in a cash collateral account opened by the
Administrative Agent an amount equal to the aggregate then undrawn and
unexpired amount of such Letters of Credit. 
Amounts held in such cash collateral account shall be applied by the
Administrative Agent to the payment of drafts drawn under such Letters of
Credit, and the unused portion thereof after all such Letters of Credit shall
have expired or been fully drawn upon, if any, shall be applied to repay other
obligations of the Borrower hereunder and under the other Loan Documents.  After all such Letters of Credit shall have
expired or been fully drawn upon, all Reimbursement Obligations shall have been
satisfied and all other obligations of the Borrower hereunder and under the
other Loan Documents shall have been paid in full, the balance, if any, in such
cash collateral account shall be returned to the Borrower (or such other Person
as may be lawfully entitled thereto).  Except
as expressly provided above in this Section, presentment, demand, protest and
all other notices of any kind are hereby expressly waived by the Borrower.

 

SECTION 10.  THE
AGENTS

 

10.1.                        Appointment.  Each
Lender hereby irrevocably designates and appoints the Administrative Agent as
the agent of such Lender under this Agreement and the other Loan Documents, and
each such Lender irrevocably authorizes the Administrative Agent, in such
capacity, to take such action on its behalf under the provisions of this
Agreement and the other Loan Documents and to exercise such powers and perform
such duties as are expressly delegated to the Administrative Agent by the terms
of this Agreement and the other Loan Documents, together with such other powers
as are reasonably incidental thereto.  
Notwithstanding any provision to the contrary elsewhere in this
Agreement, the Administrative Agent shall not have any duties or
responsibilities, except those expressly set forth herein, or any fiduciary
relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against the
Administrative Agent.

 

10.2.                        Delegation of Duties.  The
Administrative Agent may execute any of its duties under this Agreement and the
other Loan Documents by or through agents or attorneys-in-fact and shall be
entitled to advice of counsel concerning all matters pertaining to such
duties.  The Administrative Agent shall not
be responsible for the negligence or misconduct of any agents or attorneys
in-fact selected by it with reasonable care.

 

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

 

74

 

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

 

10.4.                        Reliance by Administrative
Agent.  The Administrative Agent shall be entitled to
rely, and shall be fully protected in relying, upon any instrument, writing,
resolution, notice, consent, certificate, affidavit, letter, telecopy, telex or
teletype message, statement, order or other document or conversation believed
by it to be genuine and correct and to have been signed, sent or made by the
proper Person or Persons and upon advice and statements of legal counsel
(including counsel to the Borrower), independent accountants and other experts
selected by the Administrative Agent. 
The Administrative Agent may deem and treat the payee of any Note as the
owner thereof for all purposes unless a written notice of assignment,
negotiation or transfer thereof shall have been filed with the Administrative
Agent.  The Administrative Agent shall be
fully justified in failing or refusing to take any action under this Agreement
or any other Loan Document unless it shall first receive such advice or
concurrence of the Majority Lenders (or, if so specified by this Agreement, all
Lenders) as it deems appropriate or it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense that may
be incurred by it by reason of taking or continuing to take any such
action.  The Administrative Agent shall
in all cases be fully protected in acting, or in refraining from acting, under
this Agreement and the other Loan Documents in accordance with a request of the
Majority Lenders (or, if so specified by this Agreement, all Lenders), and such
request and any action taken or failure to act pursuant thereto shall be
binding upon all the Lenders and all future holders of the Loans.

 

10.5.                        Notice of Default.  The
Administrative Agent shall not be deemed to have knowledge or notice of the
occurrence of any Default or Event of Default unless the 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 the
Administrative Agent receives such a notice, the Administrative Agent shall
give notice thereof to the Lenders.  The
Administrative Agent shall take such action with respect to such Default or
Event of Default as shall be reasonably directed by the Majority Lenders (or,
if so specified by this Agreement, all Lenders); provided that unless
and until the Administrative Agent shall have received such directions, the
Administrative Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Default or Event of
Default as it shall deem advisable in the best interests of the Lenders.

 

10.6.                        Non-Reliance on Agents and
Other Lenders.  Each Lender expressly acknowledges that
neither the Agents nor any of their respective officers, directors, employees,
agents, attorneys-in-fact or affiliates have made any representations or
warranties to it and that no act by any Agent hereafter taken, including any
review of the affairs of a Loan Party or any affiliate of a Loan Party, shall
be deemed to constitute any representation or warranty by any Agent to any
Lender.  Each Lender represents to the Agents
that it has, independently and without reliance upon any Agent or any other
Lender, and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the

 

75

 

business,
operations, property, financial and other condition and creditworthiness of the
Loan Parties and their affiliates and made its own decision to make its Loans
hereunder and enter into this Agreement. 
Each Lender also represents that it will, independently and without
reliance upon any Agent or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement and the other Loan Documents, and to make such investigation as
it deems necessary to inform itself as to the business, operations, property,
financial and other condition and creditworthiness of the Loan Parties and
their affiliates.  Except for notices,
reports and other documents expressly required to be furnished to the Lenders
by the Administrative Agent hereunder, the Administrative Agent shall not have
any duty or responsibility to provide any Lender with any credit or other
information concerning the business, operations, property, condition (financial
or otherwise), prospects or creditworthiness of any Loan Party or any affiliate
of a Loan Party that may come into the possession of the Administrative Agent
or any of its officers, directors, employees, agents, attorneys-in-fact or
affiliates.

 

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

 

10.8.                        Agent in Its Individual
Capacity.  Each Agent and its affiliates may make loans
to, accept deposits from and generally engage in any kind of business with any
Loan Party as though such Agent were not an Agent.  With respect to its Loans made or renewed by
it and with respect to any Letter of Credit issued or participated in by it,
each Agent shall have the same rights and powers under this Agreement and the
other Loan Documents as any Lender and may exercise the same as though it were
not an Agent, and the terms “Lender” and “Lenders” shall include each Agent in
its individual capacity.

 

10.9.                        Successor Administrative
Agent.  The Administrative Agent may resign as
Administrative Agent upon 10 days’ notice to the Lenders and the Borrower.  If the Administrative Agent shall resign as
Administrative Agent under this Agreement and the other

 

76

 

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

 

10.10.                  Co- Syndication Agents.  None
of the Co-Syndication Agents shall have any duties or responsibilities
hereunder in its capacity as such.

 

10.11.                  Intercreditor Agreements.  Each
Lender hereby agrees that the Administrative Agent may enter into any
Intercreditor Agreement pursuant to the terms hereof on its behalf and agrees
to be bound by the terms thereof and, in the case of any Intercreditor
Agreement relating to Permitted Pari Passu Debt, consents and agrees to the
appoint of JPMCB on its behalf as collateral agent thereunder.  In addition, the Lenders hereby agree that
pursuant to any Intercreditor Agreement entered into substantially in the forms
attached as Exhibits I or K, the Administrative Agent may designate any
addition Security Document hereunder as an “Addition Existing Facilities
Security Document” and/or a “First Priority Security Document” or similar term,
as the case may be, thereunder.  

 

SECTION 11.  MISCELLANEOUS

 

11.1.                        Amendments and Waivers. 
Neither this Agreement, any other Loan Document, nor any terms hereof or
thereof may be amended, supplemented or modified except in accordance with the
provisions of this Section 11.1. 
The Majority Lenders and each Loan Party party to the relevant Loan
Document may, or, with the written consent of the Majority Lenders, the
Administrative Agent and each Loan Party party to the relevant Loan Document
may, from time to time, (a) enter into written amendments, supplements or
modifications hereto and to the other Loan Documents for the purpose of adding
any provisions to this Agreement or the other Loan Documents or changing in any
manner the rights of the Lenders or of the Loan Parties hereunder or thereunder
or (b) waive, on such terms and conditions as the Majority Lenders or the
Administrative Agent, as the case may be, may specify in such instrument, any
of the requirements of this Agreement or the other Loan Documents or any
Default or Event of Default and its consequences; provided, however,
that no such waiver and no such amendment, supplement or modification shall (i) forgive
the principal amount or extend the final scheduled

 

77

 

date
of maturity of any Loan, extend the scheduled date of any amortization payment
in respect of any Term Loan, reduce the stated rate of any interest or fee
payable hereunder (except (x) in connection with any reduction in the
post-default rate of interest set forth in Section 2.14(c); (y) in
connection with the waiver of applicability of any post-default increase in
interest rates (which waiver shall be effective with the consent of the
Majority Facility Lenders of each adversely affected Facility); and (z) that
any amendment or modification of defined terms used in the financial covenants
in this Agreement shall not constitute a reduction in the rate of interest or
fees for purposes of this clause (i)) or extend the scheduled date of any
payment thereof, or increase the amount or extend the expiration date of any
Lender’s Revolving Commitment, or otherwise change the time, place or the
currency of payments to be made on the Loans, in each case without the written
consent of each Lender directly affected thereby; (ii) eliminate or reduce
the voting rights of any Lender under this Section 11.1 without the
written consent of such Lender; (iii) reduce any percentage specified in
the definition of Majority Lenders, consent to the assignment or transfer by
the Borrower of any of its rights and obligations under this Agreement and the
other Loan Documents, release all or substantially all of the Collateral or
release all or substantially all of the Subsidiary Guarantors from their
obligations under the Guarantee and Collateral Agreement, in each case without
the written consent of all Lenders; (iv) reduce the percentage specified
in the definition of Majority Facility Lenders with respect to any Facility
without the written consent of all Lenders under such Facility; (v) amend,
modify or waive any provision of Section 2.17 without the written consent
of each Lender adversely affected thereby; (vi) amend, modify or waive any
provision of Section 10 without the written consent of the Administrative
Agent; (vii) amend, modify or waive any provision of Section 2.6 or
2.7 without the written consent of the Swingline Lender; or (viii) amend,
modify or waive any provision of Section 3 without the written consent of
each Issuing Lender.  Any such waiver and
any such amendment, supplement or modification shall apply equally to each of
the Lenders and shall be binding upon the Loan Parties, the Lenders, the
Administrative Agent and all future holders of the Loans.  In the case of any waiver, the Loan Parties,
the Lenders and the Administrative Agent shall be restored to their former
position and rights hereunder and under the other Loan Documents, and any
Default or Event of Default waived shall be deemed to be cured and not continuing;
but no such waiver shall extend to any subsequent or other Default or Event of
Default, or impair any right consequent thereon.

 

Notwithstanding the foregoing, this Agreement may be
amended (or amended and restated) with the written consent of the Majority
Lenders, the Administrative Agent and the Borrower (a) to add one or more
additional credit facilities to this Agreement (each, an “Incremental
Facility”) and to permit the extensions of credit from time to time
outstanding thereunder and the accrued interest and fees in respect thereof to
share ratably in the benefits of this Agreement and the other Loan Documents
with the Term Loans and Revolving Extensions of Credit and the accrued interest
and fees in respect thereof and (b) to include appropriately the Lenders
holding such credit facilities in any determination of the Majority Lenders and
Majority Facility Lenders, provided that no consent of the Majority
Lenders or Administrative Agent (except as provided in clause (iv) below)
shall be required if (i) such Incremental Facility constitutes Permitted
Pari Passu Debt hereunder, (ii) no Default or Event of Default has
occurred and is continuing or would result after giving effect to the making of
Loans under such Incremental Facility, (iii) the Applicable Margin for
such Loans shall not be greater than the Applicable Margin then in effect for
the comparable Loans hereunder by more than 0.25% and, other than with respect
to such pricing term, such Loans shall otherwise be on the same terms

 

78

 

and
conditions as those applicable to the Loans and (iv) any bank, financial
institution or other entity that becomes a Lender under such Incremental
Facility shall be subject to the consent of the Administrative Agent.

 

In addition, notwithstanding the foregoing, this
Agreement may be amended with the written consent of the Administrative Agent,
the Borrower and the Lenders providing the relevant Replacement Term Loans (as
defined below) to permit the refinancing, replacement or modification of all
outstanding Term Loans (“Refinanced Term Loans”) with a replacement “B”
term loan tranche hereunder (“Replacement Term Loans”), provided
that (a) the aggregate principal amount of such Replacement Term Loans
shall not exceed the aggregate principal amount of such Refinanced Term Loans, (b) the
Applicable Margin for such Replacement Term Loans shall not be higher than the
Applicable Margin for such Refinanced Term Loans and (c) the weighted
average life to maturity of such Replacement Term Loans shall not be shorter
than the weighted average life to maturity of such Refinanced Term Loans at the
time of such refinancing.

 

If, in connection with any proposed amendment,
waiver or consent pursuant to Section 11.1 
hereof requiring the consent of all Lenders, the consent of Majority
Lenders is obtained but the consent of all Lenders whose consent if required is
not obtained (any Lender withholding consent being referred to as a “Non-Consenting
Lender”), then, upon written notice to any Non-Consenting Lender and
the Administrative Agent, the Borrower shall be permitted, at its sole expense,
to replace such Non-Consenting Lender by requiring such Non-Consenting Lender
to assign and delegate, without recourse, all of its rights and obligations
under this Agreement and the other Loan Documents to a replacement financial
institution that shall assume such obligations (which replacement financial
institution may be another Lender, if such Lender accepts such assignment); provided,
that (i) the Administrative Agent and, in the case of any assignment of a
Lender’s Revolving Commitment, each Revolving Issuing Lender shall have
consented to such replacement financial institution (such consent not to be
unreasonably withheld), (ii) the Non-Consenting Lender shall be obligated
to make such replacement in accordance with the provisions of Section 11.6
(provided that the Borrower shall be obligated to pay the registration and
processing fee referred to therein), (iii) the replacement financial
institution shall purchase, at par, all Loans and other amounts owing to such
replaced Lender on or prior to the date of replacement in accordance with Section 11.6,
and (iv) the Borrower shall be liable to such Non-Consenting Lender under Section 2.20
if any Eurodollar Loan owing to such Non-Consenting Lender shall be purchased
other than on the last day of the Interest Period relating thereto.

 

11.2.                        Notices.  All
notices, requests and demands to or upon the respective parties hereto to be
effective shall be in writing (including by telecopy), and, unless otherwise
expressly provided herein, shall be deemed to have been duly given or made when
delivered, or three Business Days after being deposited in the mail, postage
prepaid, or, in the case of telecopy notice, when received, addressed as
follows in the case of the Borrower, the Administrative Agent and the Issuing
Lenders identified below, and as set forth in an administrative questionnaire
delivered to the Administrative Agent in the case of the Lenders, or to such
other address as may be hereafter notified by the respective parties hereto:

 

79

 

	
  Borrower:

  	
   

  	
  Mirant North America, LLC

  1155 Perimeter Center West,

  Suite 100

  Atlanta, GA 30338

  
	
   

  	
   

  	
  Attention: William Holden

  
	
   

  	
   

  	
  Telecopy: (678) 579-7634

  
	
   

  	
   

  	
  Telephone: (678) 579-7728

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  With a copy to: Steve
  Nickerson

  
	
   

  	
   

  	
  Telecopy: (678) 579-5951

  
	
   

  	
   

  	
  Telephone: (678) 579-6440

  
	
   

  	
   

  	
   

  
	
  Administrative Agent:

  	
   

  	
  JP Morgan Chase Bank, N.A.

  
	
   

  	
   

  	
  1111 Fannin Street, Floor
  10

  
	
   

  	
   

  	
  Houston, Texas 77002

  
	
   

  	
   

  	
  Attention: Loan and Agency
  Services

  
	
   

  	
   

  	
  Telecopy: (713) 427-6307

  
	
   

  	
   

  	
  Telephone: (713) 750-2377

  
	
   

  	
   

  	
   

  
	
  JPMCB, as an Issuing
  Lender

  	
   

  	
  JPMorgan Chase Bank, N.A.

  
	
   

  	
   

  	
  10420 Highland Manner
  Drive

  
	
   

  	
   

  	
  BL 2, Floor 4

  
	
   

  	
   

  	
  Tampa, Florida 33610

  
	
   

  	
   

  	
  Attention: Standby Letter
  of Credit

  
	
   

  	
   

  	
  Telecopy: (813) 432-5161

  
	
   

  	
   

  	
  Telephone: (813) 432-6339

  
	
   

  	
   

  	
   

  
	
  DBTCA, as an Issuing
  Lender

  	
   

  	
  Deutsche Bank Trust
  Company

  
	
   

  	
   

  	
  Americas

  
	
   

  	
   

  	
  60 Wall Street

  
	
   

  	
   

  	
  38th Floor

  
	
   

  	
   

  	
  New York, NY 10005

  
	
   

  	
   

  	
  Attention: Standby Letter
  of Credit

  
	
   

  	
   

  	
  Unit

  
	
   

  	
   

  	
  Telecopy: (212) 250-1014

  
	
   

  	
   

  	
  Telephone: (212) 797-0403

  

 

provided that
any notice, request or demand to or upon the Administrative Agent, any Issuing
Lender or the Lenders shall not be effective until received.

 

Notices and other communications to the Lenders
hereunder may be delivered or furnished by electronic communications pursuant
to procedures approved by the Administrative Agent; provided that the
foregoing shall not apply to notices pursuant to Section 2 unless
otherwise agreed by the Administrative Agent and the applicable Lender.  The Administrative Agent or the Borrower may,
in its discretion, agree to accept notices and other communications to it
hereunder by electronic communications pursuant to procedures approved by it; provided
that approval of such procedures may be limited to particular notices or
communications.

 

80

 

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

 

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

 

11.5.                        Payment of Expenses and
Taxes.  The Borrower agrees (a) to pay or
reimburse the Administrative Agent (i) for all its out-of-pocket costs and
expenses incurred in connection with the development, preparation and execution
of, and any amendment, supplement or modification to, this Agreement and the
other Loan Documents and any other documents prepared in connection herewith or
therewith, and the consummation and administration of the transactions
contemplated hereby and thereby, including the reasonable fees and
disbursements of counsel to the Administrative Agent and filing and recording
fees and expenses, with statements with respect to the foregoing to be
submitted to the Borrower prior to the Closing Date (in the case of amounts to
be paid on the Closing Date) and from time to time thereafter on a quarterly
basis or such other periodic basis as the Administrative Agent shall deem
appropriate and (ii) for all of its costs and expenses incurred in
connection with the enforcement or preservation of any rights under this
Agreement, the other Loan Documents and any such other documents, including the
fees and disbursements of counsel to the Administrative Agent, (b) to pay
or reimburse each Lender for all its costs and expenses incurred in connection
with the enforcement or preservation of any rights under this Agreement, the
other Loan Documents and any such other documents, in each case, during the
continuance of an Event of Default, including the fees and disbursements of
counsel (including the allocated fees and expenses of in-house counsel) to each
Lender, (c) to pay, indemnify, and hold each Lender and the Administrative
Agent harmless from, any and all recording and filing fees and any and all
liabilities with respect to, or resulting from any delay in paying, stamp,
excise and other taxes, if any, that may be payable or determined to be payable
in connection with the execution and delivery of, or consummation or administration
of any of the transactions contemplated by, or any amendment, supplement or
modification of, or any waiver or consent under or in respect of, this
Agreement, the other Loan Documents and any such other documents, and (d) to
pay, indemnify, and hold each Lender and the Administrative Agent and their
respective officers, directors, trustees, employees, affiliates, agents and
controlling persons (each, an “Indemnitee”) harmless from and against
any and all other liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever with respect to the execution, delivery, enforcement,
performance and administration of this Agreement, the other Loan Documents and
any such other documents, including any of the foregoing relating to the use of
proceeds of the Loans or the violation of, noncompliance with or liability
under, any Environmental Law applicable to the operations of the Borrower or
any of its Subsidiaries or any real property currently or formerly owned,
leased, operated or otherwise used (including properties to which wastes or
other materials were sent for treatment, storage or disposal) by the 

 

81

 

Borrower
or any of its Subsidiaries or any of their predecessors and the reasonable fees
and expenses of legal counsel in connection with claims, actions or proceedings
by any Indemnitee against any Loan Party under any Loan Document (all the
foregoing in this clause (d), collectively, the “Indemnified Liabilities”),
provided, that the Borrower shall have no obligation hereunder to any
Indemnitee with respect to Indemnified Liabilities to the extent such
Indemnified Liabilities are found by a final and nonappealable decision of a court
of competent jurisdiction to have resulted from the gross negligence or willful
misconduct of such Indemnitee.  Without
limiting the foregoing, and to the extent permitted by applicable law, the
Borrower agrees not to assert and to cause its Subsidiaries not to assert, and
hereby waives and agrees to cause its Subsidiaries to waive, all rights for
contribution or any other rights of recovery with respect to all claims,
demands, penalties, fines, liabilities, settlements, damages, costs and
expenses of whatever kind or nature, under or related to Environmental Laws,
that any of them might have by statute or otherwise against any
Indemnitee.  

 

Promptly after receipt by an Indemnitee of notice of
the commencement of any claim, litigation, investigation, responding to or
proceedings against it relating to any Indemnified Liability (“Proceedings”),
such Indemnitee will, if a claim is to be made hereunder against the Borrower
in respect thereof, notify the Borrower in writing of the commencement thereof;
provided, however, that (i) the omission so to notify the
Borrower will not relieve it from any liability that it may have hereunder
except to the extent it has been materially prejudiced by such failure and (ii) the
omission so to notify the Borrower will not relieve the Borrower from any
liability that it may have to an Indemnitee otherwise than on account
hereof.  Thereafter, the Indemnitee and
the Borrower shall consult, to the extent appropriate, with a view to minimizing
the cost to the Borrower of the obligations under this Section 11.5.  In case any such Proceedings are brought
against any Indemnitee and it notifies the Borrower of the commencement
thereof, the Borrower will be entitled to participate therein, and, to the
extent that it may elect by written notice delivered to such Indemnitee, to
assume the defense thereof, with counsel reasonably satisfactory to such
Indemnitee, provided that if the defendants in any such Proceedings
include both such Indemnitee and the Borrower and such Indemnitee shall have
concluded that there may be legal defenses available to it that are different
from or additional to those available to the Borrower, such Indemnitee shall
have the right to select separate counsel to assert such legal defenses and to
otherwise participate in the defense of such Proceedings on behalf of such
Indemnitee.  Upon receipt of notice from
the Borrower to such Indemnitee of its election so to assume the defense of
such Proceedings and approval by such Indemnitee of counsel, the Borrower shall
not be liable to such Indemnitee for expenses incurred by such Indemnitee in
connection with the defense thereof (other than reasonable costs of
investigation) unless (i) such Indemnitee shall have employed separate
counsel in connection with the assertion of legal defenses in accordance with
the proviso to the immediately preceding sentence (it being understood,
however, that the Borrower shall not be liable for the expenses of more than
one separate counsel representing the Indemnitees who are parties to such
Proceedings), (ii) the Borrower shall not have employed counsel reasonably
satisfactory to such Indemnitee to represent such Indemnitee within a
reasonable time after notice of commencement of the Proceedings or (iii) the
Borrower shall have authorized in writing the employment of counsel for such
Indemnitee.

 

The Borrower shall not be liable for any settlement
of any Proceedings effected without its written consent (which consent shall
not be unreasonably withheld).  If any
settlement of

 

82

 

any
Proceeding is consummated with the written consent of the Borrower or if there
is a final judgment for the plaintiff in any such Proceedings, the Borrower
agrees to indemnify and hold harmless each Indemnitee from and against any and
all losses, claims, damages, liabilities and expenses by reason of such
settlement or judgment in accordance with the provisions of this Section 11.5(d).  Notwithstanding anything in this Section 11.5(d) to
the contrary, if at any time an Indemnitee shall have requested the Borrower to
reimburse such Indemnitee for legal or other expenses in connection with
investigating, responding to or defending any Proceedings as contemplated by
this Section 11.5(d), the Borrower shall be liable for any settlement of
any Proceedings effected without its written consent if (i) such
settlement is entered into more than 30 days after receipt by the Borrower of
such request for reimbursement and (ii) the Borrower shall not have
reimbursed such Indemnitee in accordance with such request prior to the date of
such settlement.  The Borrower shall not,
without the prior written consent of an Indemnitee (which consent shall not be
unreasonably withheld), effect any settlement of any pending or threatened Proceedings
in respect of which indemnity could have been sought hereunder by such
Indemnitee unless such settlement (i) includes an unconditional release of
such Indemnitee in form and substance satisfactory to such Indemnitee from all
liability on claims that are the subject matter of such Proceedings and (ii) does
not include any statement as to or any admission of fault, culpability or a
failure to act by or on behalf of any Indemnitee.  

 

All amounts due under this Section 11.5 shall
be payable not later than 10 days after written demand therefor.  Statements payable by the Borrower pursuant
to this Section 11.5 shall be submitted to the Treasurer (Telephone No. (678)
579-7728) (Telecopy No. (678) 579-7634), at the address of the Borrower
set forth in Section 11.2, or to such other Person or address as may be
hereafter designated by the Borrower in a written notice to the Administrative
Agent.  The agreements in this Section 11.5
shall survive repayment of the Loans and all other amounts payable hereunder.

 

11.6.                        Successors and Assigns;
Participations and Assignments.  (a)  The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns permitted hereby (including any affiliate of
the Issuing Lender that issues any Letter of Credit), except that (i) the
Borrower may not assign or otherwise transfer any of its rights or obligations
hereunder without the prior written consent of each Lender (and any attempted
assignment or transfer by the Borrower without such consent shall be null and
void) and (ii) no Lender may assign or otherwise transfer its rights or
obligations hereunder except in accordance with this Section.

 

(b)                                 (i)  Subject to the conditions set
forth in paragraph (b)(ii) below, any Lender may assign to one or more
assignees (each, an “Assignee”) all or a portion of its rights and
obligations under this Agreement (including all or a portion of its Commitments
and the Loans at the time owing to it) with the prior written consent of:

 

(A)                              the Borrower (such consent not to be
unreasonably withheld or delayed), provided that no consent of the
Borrower shall be required for an assignment to a Lender, an affiliate of a
Lender, an Approved Fund (as defined below) or, if an Event of Default has
occurred and is continuing, any other Person; and

 

83

 

(B)                                the Administrative Agent and each
Issuing Lender (such consent not to be unreasonably withheld or delayed), provided
that no consent of the Administrative Agent shall be required for assignments
of Commitments and/or Loans among Lenders, affiliates of Lenders or Approved
Funds within the same Facility, and provided, further, that no
consent of any Issuing Lender shall be required for an assignment of Term Loans
only.

 

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

 

(A)                              except in the case of an assignment to a
Lender, an affiliate of a Lender or an Approved Fund or an assignment of the
entire remaining amount of the assigning Lender’s Commitments or Loans
under any Facility, the amount of the Commitments or Loans of the assigning
Lender subject to each such assignment (determined as of the date the
Assignment and Assumption with respect to such assignment is delivered to the
Administrative Agent) shall not be less than $5,000,000 unless each of the
Borrower and the Administrative Agent otherwise consent (which assignment may
be on a non-pro rata basis), provided that such amounts shall be
aggregated in respect of each Lender and its affiliates or Approved Funds, if
any; 

 

(B)                                the parties to each assignment shall
execute and deliver to the Administrative Agent an Assignment and Assumption,
together with a processing and recordation fee of $3,500, provided that
only one such fee shall be payable to the Administrative Agent in connection
with simultaneous assignments by a Lender to two or more related Approved
Funds; and 

 

(C)                                the Assignee, if it shall not be a
Lender, shall deliver to the Administrative Agent an administrative
questionnaire.

 

For the purposes of this Section 11.6, “Approved
Fund” means any Person (other than a natural person) that is engaged in
making, purchasing, holding or investing in bank loans and similar extensions
of credit in the ordinary course and that is administered or managed by (a) a
Lender, (b) an affiliate of a Lender or (c) an entity or an affiliate
of an entity that administers or manages a Lender.

 

(iii)                               Subject to acceptance and recording
thereof pursuant to paragraph (b)(iv) below, from and after the
effective date specified in each Assignment and Assumption the Assignee
thereunder shall be a party hereto and, to the extent of the interest assigned
by such Assignment and Assumption, have the rights and obligations of a Lender
under this Agreement, and the assigning Lender thereunder shall, to the extent
of the interest assigned by such Assignment and Assumption, be released from
its obligations under this Agreement (and, in the case of an Assignment and
Assumption covering all of the assigning Lender’s rights and obligations under
this Agreement, such Lender shall cease to be a party hereto but shall continue
to be entitled to the benefits of Sections 2.18, 2.19, 2.20 and 11.5 with
respect to facts and circumstances occurring prior to the effective date of
such assignment).  To the extent that an
assignment of all or any portion of a Lender’s outstanding obligations pursuant
to this Section 11.6 would, at the time of such assignment, result in
increased costs under Sections 2.18, 2.19, or

 

84

 

2.20 from those being
charged by the respective assigning Lender prior to such assignment, then the
Borrower shall not be obligated to pay such increased costs.  Any assignment or transfer by a Lender of
rights or obligations under this Agreement that does not comply with this Section 11.6
shall be treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with paragraph (c) of
this Section.

 

(iv)                              The Administrative Agent, acting for this
purpose as an agent of the Borrower, shall maintain at one of its offices a
copy of each Assignment and Assumption delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitments of,
and principal amount of the Loans and Revolving L/C Obligations owing to, each
Lender pursuant to the terms hereof from time to time (the “Register”).  The entries in the Register shall be
conclusive, and the Borrower, the Administrative Agent, the Issuing Lenders and
the Lenders may treat each Person whose name is recorded in the Register
pursuant to the terms hereof as a Lender hereunder for all purposes of this
Agreement, notwithstanding notice to the contrary.  With respect to any Lender, the transfer of
the Commitments of such Lender and the rights to the principal of, and the
interest on, any Loan made pursuant to such Commitments shall not be effective
until such transfer is recorded on the Register maintained by the Administrative
Agent with respect to ownership of such Commitments and Loans.  The Register shall be available for
inspection by the Borrower, the Issuing Lenders and any Lender, at any
reasonable time and from time to time upon reasonable prior notice.

 

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

 

(c)                                  (i)  Any Lender may, without the
consent of the Borrower or the Administrative Agent, sell participations to one
or more banks or other entities (a “Participant”) in all or a portion of
such Lender’s rights and obligations under this Agreement (including all or a
portion of its Commitments and the Loans owing to it); provided that (A) such
Lender’s obligations under this Agreement shall remain unchanged, (B) such
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations and (C) the Borrower, the Administrative
Agent, the Issuing Lenders and the other Lenders shall continue to deal solely
and directly with such Lender in connection with such Lender’s rights and
obligations under this Agreement.  Any
agreement pursuant to which a Lender sells such a participation shall provide
that such Lender shall retain the sole right to enforce this Agreement and to
approve any amendment, modification or waiver of any provision of this
Agreement; provided that such agreement may provide that such Lender
will not, without the consent of the Participant, agree to any amendment,
modification or waiver that (1) requires the consent of each Lender
directly affected thereby pursuant to the proviso to the second sentence of Section 11.1
and (2) directly affects such Participant. 
Subject to paragraph (c)(ii) of this Section, the Borrower agrees
that each Participant shall be entitled to the benefits of Sections 2.18, 2.19
and 2.20 to the same extent as if it were a Lender and had acquired its
interest by assignment pursuant to paragraph

 

85

 

(b) of this
Section.  To the extent permitted by law,
each Participant also shall be entitled to the benefits of Section 11.7(b) as
though it were a Lender, provided such Participant shall be subject to Section 11.7(a) as
though it were a Lender.

 

(ii)                                  A Participant shall not be entitled to
receive any greater payment under Section 2.18 or 2.19 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.  Any Participant that is a Non-U.S. Lender
shall not be entitled to the benefits of Section 2.19 unless such
Participant complies with Sections 2.19(d) and (e).

 

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

 

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

 

(f)                                    Notwithstanding the foregoing, any Conduit
Lender may assign any or all of the Loans it may have funded hereunder to its
designating Lender without the consent of the Borrower or the Administrative
Agent and without regard to the limitations set forth in Section 11.6(b).  Each of the Borrower, each Lender and the
Administrative Agent hereby confirms that it will not institute against a
Conduit Lender or join any other Person in instituting against a Conduit Lender
any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceeding under any state bankruptcy or similar law, for one year and one day
after the payment in full of the latest maturing commercial paper note issued
by such Conduit Lender; provided, however, that each Lender designating
any Conduit Lender hereby agrees to indemnify, save and hold harmless each
other party hereto for any loss, cost, damage or expense arising out of its
inability to institute such a proceeding against such Conduit Lender during
such period of forbearance.

 

11.7.                        Adjustments; Set-off.  (a) 
Except to the extent that this Agreement expressly provides for payments to be
allocated to a particular Lender or to the Lenders under a particular Facility,
if any Lender (a “Benefitted Lender”) shall receive any payment of all
or part of the Obligations owing to it, or receive any collateral in respect
thereof (whether voluntarily or involuntarily, by set-off, pursuant to events
or proceedings of the nature referred to in Section 9(g), or otherwise),
in a greater proportion than any such payment to or collateral received by any
other Lender, if any, in respect of the Obligations owing to such other Lender,
such Benefitted Lender shall purchase for cash from the other Lenders a
participating interest in such portion of the Obligations owing to each such
other Lender, or shall provide such other Lenders with the benefits of any such
collateral, as shall be necessary to cause such Benefitted Lender to share the
excess payment or benefits of such collateral ratably with each of the Lenders;
provided, however, that if all or any portion of such excess
payment or benefits is thereafter

 

86

 

recovered
from such Benefitted Lender, such purchase shall be rescinded, and the purchase
price and benefits returned, to the extent of such recovery, but without
interest.

 

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

 

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

 

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

 

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

 

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

 

11.12.                  Submission To Jurisdiction; Waivers.  The Borrower hereby
irrevocably and unconditionally:

 

(a)                                  submits for itself and its property in
any legal action or proceeding relating to this Agreement and the other Loan
Documents to which it is a party, or for recognition and enforcement of any
judgment in respect thereof, to the non-exclusive general

 

87

 

jurisdiction of
the courts of the State of New York, the courts of the United States for the
Southern District of New York, and appellate courts from any thereof;

 

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

 

(c)                                  agrees that service of process in any
such action or proceeding may be effected by mailing a copy thereof by
registered or certified mail (or any substantially similar form of mail),
postage prepaid, to the Borrower at its address set forth in Section 11.2
or at such other address of which the Administrative Agent shall have been
notified pursuant thereto;

 

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

 

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

 

11.13.                  Acknowledgements.  The Borrower hereby acknowledges that:

 

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

 

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

 

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

 

11.14.                  Releases of Guarantees and Liens.  (a)  Notwithstanding
anything to the contrary contained herein or in any other Loan Document, the
Administrative Agent is hereby irrevocably authorized by each Lender (without
requirement of notice to or consent of any Lender except as expressly required
by Section 11.1) to take any action requested by the Borrower having the
effect of releasing any Collateral or guarantee obligations (i) to the
extent necessary to permit consummation of any transaction not prohibited by
any Loan Document or that has been consented to in accordance with Section 11.1
or (ii) under the circumstances described in paragraph (b) below.

 

(b)                                 At such time as the Loans, the
Reimbursement Obligations and the other obligations under the Loan Documents
(other than obligations under or in respect of Swap

 

88

 

Agreements) shall have
been paid in full, the Commitments have been terminated and no Letters of
Credit shall be outstanding, the Collateral shall be released from the Liens
created by the Security Documents, and the Security Documents and all
obligations (other than those expressly stated to survive such termination) of
the Administrative Agent and each Loan Party under the Security Documents shall
terminate, all without delivery of any instrument or performance of any act by
any Person.

 

11.15.                  Confidentiality.  Each of the Administrative Agent and each
Lender agrees to keep confidential all non-public information provided to it by
any Loan Party, the Administrative Agent or any Lender pursuant to or in
connection with this Agreement that is designated by the provider thereof as
confidential; provided that nothing herein shall prevent the
Administrative Agent or any Lender from disclosing any such information (a) to
the Administrative Agent, any other Lender or any affiliate thereof, (b) subject
to an agreement to comply with the provisions of this Section, to any actual or
prospective Transferee or any direct or indirect counterparty to any Swap
Agreement (or any professional advisor to such counterparty), (c) to its
employees, directors, trustees, agents, attorneys, accountants and other
professional advisors or those of any of its affiliates, (d) upon the request
or demand of any Governmental Authority, (e) in response to any order of
any court or other Governmental Authority or as may otherwise be required
pursuant to any Requirement of Law, (f) if requested or required to do so
in connection with any litigation or similar proceeding, (g) that has been
publicly disclosed, (h) to the National Association of Insurance
Commissioners or any similar organization or any nationally recognized rating
agency that requires access to information about a Lender’s investment
portfolio in connection with ratings issued with respect to such Lender, or (i) in
connection with the exercise of any remedy hereunder or under any other Loan
Document.

 

11.16.                  WAIVERS OF JURY TRIAL.  THE BORROWER, THE ADMINISTRATIVE AGENT AND
THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY
LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.

 

11.17.                  Delivery of Addenda.  Each initial Lender shall become a party to
this Agreement by delivering to the Administrative Agent an Addendum duly
executed by such Lender.

 

89

 

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

 

	
   

  	
   

  	
  MIRANT NORTH AMERICA, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  JPMORGAN CHASE BANK, N.A., as

  Administrative Agent and as a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  GOLDMAN SACHS CREDIT PARTNERS L.P.,

  as Co-Syndication Agent

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  DEUTSCHE BANK SECURITIES, INC., as

  Co-Syndication Agent

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

90

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