Common use of Term Description Clause in Contracts

Term Description. Terms Of Class 5 Warrants (warrants for Group Notes) The following Class 5 Warrants shall be issued on the effective date of the plan of reorganization, pro rata, to holders of Class 5 Claims; Warrants to receive up to 15% of the sum of the Distributable New Equity of Reorganized Group plus the 4% of new equity of Reorganized Group for distribution to management through the management compensation plan with a strike price equivalent to the per share price of New Equity in Reorganized Group upon the effective date of the Plan, which will be the grant date of the warrants, based on the Reorganized Group entities having an aggregate Enterprise Value of $550 million. The Class 5 Warrants shall be detachable, subject to anti-dilution protections (including (i) adjustments for stock splits, stock dividends, recapitalizations and similar events, and (ii) weighted-average adjustments for issuances of equity and equity-linked securities at prices below the Fair Market Value of Reorganized Group’s common stock (it being understood that for purposes of determining the price at which any such equity or equity-linked securities are issued, any customary underwriting discounts and commissions, liquidity discounts reasonably determined in good faith by the board, placement fees or other similar expenses incurred by Reorganized Group in connection with the issuance thereof shall not be taken into account)), and may be exercised, at the option of the holder, on a cashless basis (x) at such time as the per share equity value equals or exceeds 150% of the exercise price, as determined in accordance with note 4 infra or (y) upon a change of control or registration of securities. Upon exercise of the Class 5 Warrants on a cashless basis, the holder will be entitled to receive the number of shares equal to the difference between the value of the New Equity of Reorganized Group and the exercise price. The Class 5 Warrants shall expire on the 5th anniversary of the effective date of the Plan, if not previously exercised. The Class 5 Warrants may be exercised from time to time, in whole or in part, until the expiration thereof. Assumed And Rejected Contracts Unless otherwise provided in the Plan or listed on an exhibit to the Plan, all executory contracts and unexpired leases as to which any of the Debtors is a party shall be deemed automatically assumed in accordance with the provisions and requirements of sections 365 and 1123 of the Bankruptcy Code as of the Effective Date of the Plan. Cure Payments For Executory Contracts And Unexpired Leases Any party to an Executory Contract or Unexpired Lease that wishes to assert that Cure is required as a condition to assumption shall file a proposed cure claim within forty-five days after entry of the Confirmation Order, after which the Debtors shall have forty-five days to file any objections thereto.

Term Description. Terms Of Class 5 4 Warrants (warrants for Group Holding Notes) The following three series of Class 5 4 Warrants shall be issued on the effective date of the plan of reorganization, pro rata, to holders of Class 5 4 Claims; a) Warrants to receive up to 1510% of the sum of the Distributable New Equity of Reorganized Group plus the 4% of new equity of Reorganized Group for distribution to management through the management compensation plan with a strike price equivalent to the per share price of New Equity in Reorganized Group upon the effective date of the Plan, which will be the grant date of the warrants, based on the Reorganized Group entities having an aggregate Enterprise Value of $550 375 million. b) Warrants to receive up to 10% of the sum of the Distributable New Equity of Reorganized Group plus the 4% of new equity of Reorganized Group for distribution to management through the management compensation plan with a strike price equivalent to the per share price of New Equity in Reorganized Group upon the effective date of the Plan, which will be the grant date of the warrants, based on the Reorganized Group entities having an aggregate Enterprise Value of $425 million. c) Warrants to receive up to 10% of the sum of the Distributable New Equity of Reorganized Group plus the 4% of new equity of Reorganized Group for distribution to management through the management compensation plan with a strike price equivalent to the per share price of New Equity in Reorganized Group upon the effective date of the Plan, which will be the grant date of the warrants, based on the Reorganized Group entities having an aggregate Enterprise Value of $475 million. The Class 5 4 Warrants shall be detachable, subject to anti-dilution protections (including (i) adjustments for stock splits, stock dividends, recapitalizations and similar events, and (ii) weighted-average adjustments for issuances of equity and equity-linked securities at prices below the Fair Market Value of Reorganized Group’s common stock (it being understood that for purposes of determining the price at which any such equity or equity-linked securities are issued, any customary underwriting discounts and commissions, liquidity discounts reasonably determined in good faith by the board, placement fees or other similar expenses incurred by Reorganized Group in connection with the issuance thereof shall not be taken into account)), and may be exercised, at the option of the holder, on a cashless basis (x) at such time as the per share equity value equals or exceeds 150% of the exercise price, as determined in accordance with note 4 infra or (y) upon a change of control or registration of securities. Upon exercise of the Class 5 4 Warrants on a cashless basis, the holder will be entitled to receive the number of shares equal to the difference between the value of the New Equity of Reorganized Group and the exercise price. The Class 5 4 Warrants shall expire on the 5th anniversary of the effective date of the Plan, if not previously exercised. The Class 5 4 Warrants may be exercised from time to time, in whole or in part, until the expiration thereof. Assumed And Rejected Contracts Unless otherwise provided in the Plan or listed on an exhibit to the Plan, all executory contracts and unexpired leases as to which any of the Debtors is a party shall be deemed automatically assumed in accordance with the provisions and requirements of sections 365 and 1123 of the Bankruptcy Code as of the Effective Date of the Plan. Cure Payments For Executory Contracts And Unexpired Leases Any party to an Executory Contract or Unexpired Lease that wishes to assert that Cure is required as a condition to assumption shall file a proposed cure claim within forty-five days after entry of the Confirmation Order, after which the Debtors shall have forty-five days to file any objections thereto.

Term Description. Terms Of Class 5 Warrants (warrants for Management Compensation 4% of the new equity of Reorganized Group Notes) The following Class 5 Warrants shall be issued to senior management in the form of restricted stock units on temporal and performance-based vesting terms to be mutually agreed upon by the effective date of Debtors, Requisite Holding Noteholders (as defined in the plan of reorganizationPlan Support Agreement to which this Plan Term Sheet is attached), pro rata, and the Requisite Second Lien Noteholders (as defined in the Plan Support Agreement to holders of Class 5 Claims; which this Plan Term Sheet is attached) and set forth on an exhibit to the Plan. Warrants equal to receive up to 156% of the sum of the Distributable New Equity of Reorganized Group plus the 4% of new equity of Reorganized Group for distribution to management through the management compensation plan with a strike price equivalent to the per share price of New Equity in Reorganized Group upon the effective date of the Plan, which will be the grant date of the warrants, based on the Reorganized Group entities having an aggregate Enterprise Value of $550 millionplan. The Class 5 Warrants Such warrants shall be detachable, non-transferable subject to anti-dilution protections (including (i) adjustments for stock splits, stock dividends, recapitalizations and similar events, and (ii) weighted-average adjustments for issuances of equity and equity-linked securities at prices below the Fair Market Value Value5 of Reorganized Group’s common stock (it being understood that for purposes of determining the price at which any such equity or equity-linked securities are issued, any customary underwriting discounts and commissions, liquidity discounts reasonably determined in good faith by the board, placement fees or other similar expenses incurred by Reorganized Group in connection with the issuance thereof shall not be taken into account)). The exercise price of each such warrant shall be equal to the per share price of New Equity in Reorganized Group upon the effective date of the Plan, which will be the grant date of the warrants, based on the Reorganized Group entities having an aggregate Enterprise Value of $375 million. Such warrants will have a 10 year term and may be exercised, at the option of the holder, on a cashless basis (x) at such time as the per share equity value equals or exceeds 150% of the exercise price, as determined in accordance with note 4 infra or (y) upon a change of control or registration of securitiesinfra. Upon exercise of the Class 5 Warrants a warrant on a cashless basis, the holder will be entitled to receive the number of shares equal to the difference between the value of the New Equity of Reorganized Group and the exercise price. The Class 5 Warrants warrants shall expire be distributed and vest on terms to be mutually agreed upon by the 5th anniversary of Debtors, Requisite Holding Noteholders, and the effective date of the Plan, if not previously exercised. The Class 5 Warrants may be exercised from time to time, in whole or in part, until the expiration thereof. Assumed And Rejected Contracts Unless otherwise provided in the Plan or listed Requisite Second Lien Noteholders and set forth on an exhibit to the Plan. The compensation, all executory contracts cash bonus targets, and unexpired leases severance policies shall remain those that were effective as of December 31, 2008, subject to which any the continued approval of the Debtors is a party shall New Board (as defined below). Board of Directors There will be deemed automatically assumed in accordance an initial board of directors of Reorganized Group (the “New Board”), which will consist of 5 directors, consisting of: (a) the current CEO of Group, (b) the current Executive Vice President of Group, (c) one member appointed by the holders of the Class 4 Claims, (d) one member appointed by the holders of the Class 3 Claims, and (e) one member jointly appointed by the holders of the Class 3 Claims and the Class 4 Claims, after consultation with the provisions and requirements of sections 365 and 1123 of the Bankruptcy Code as of the Effective Date of the Plan. Cure Payments For Executory Contracts And Unexpired Leases Any party to an Executory Contract or Unexpired Lease that wishes to assert that Cure is required as a condition to assumption shall file a proposed cure claim within forty-five days after entry of the Confirmation Order, after which the Debtors shall have forty-five days to file any objections theretoDebtors.

Term Description. Terms Of Class 5 Warrants New First Lien Credit Facility On the Effective Date, the DIP Facility will (warrants for Group NotesA) The following Class 5 Warrants shall if the Company has arranged a new first lien credit facility with a third party in form and substance acceptable to the Company and the Requisite Lenders (such facility the “New Money First Lien Facility”), be issued on repaid in full, in cash, from the effective date proceeds of the plan of reorganization, pro rata, to holders of Class 5 Claims; Warrants to receive up to 15% New Money First Lien Facility in the amount of the sum DIP Facility Claims, or (B) to the extent not otherwise repaid in full, in cash, convert into a new first lien credit facility as set forth in the DIP Term Sheet, in form and substance acceptable to the Company, the Requisite DIP Lenders and the Requisite Lenders, including the terms set forth below (the “Converted New First Lien Facility”, and together with the New Money First Lien TERM DESCRIPTION Facility, the “New First Lien Facility”). In addition to other terms and conditions to be agreed upon among the Company, the Requisite DIP Lenders and the Requisite Lenders, the Converted New First Lien Facility shall contain the following terms and conditions: Principal Amount: An amount not to exceed the accrued, unpaid balance of the Distributable New Equity of Reorganized Group plus the 4% of new equity of Reorganized Group for distribution to management through the management compensation plan with a strike price equivalent to the per share price of New Equity in Reorganized Group upon the effective date DIP Facility as of the PlanEffective Date, which will be plus any additional amounts necessary or desirable for the grant date operations and working capital requirements of the warrantsReorganized Company, as to be determined by the Company and/or the Reorganized Company (as the case may be), the Requisite DIP Lenders and the Requisite Lenders. The New First Lien Facility shall have a market rate of interest (which may be cash, paid in kind, or a combination of both) based on the size, credit profile and industry of the Reorganized Group entities having an aggregate Enterprise Value Company, and shall contain such other terms and covenants as to be agreed upon among the Company and/or the Reorganized Company (as the case may be), the Requisite DIP Lenders and the Requisite Lenders and the lenders thereto. Common Units On the Effective Date, reorganized Panda Holdings II will issue new limited liability company interests (the “Common Units”), which shall be deemed fully paid and non-assessable upon issuance, to be distributed in accordance with the terms of $550 millionthe Restructuring Support Agreement, this Restructuring Term Sheet, the Plan and the Plan Documents, as applicable. The Class 5 Warrants Plan and the Confirmation Order shall each provide that the issuance of any securities in connection therewith, including the Common Units, will be exempt from the registration and prospectus delivery requirements of the Securities Act of 1933, as amended, in accordance with section 1145 of the Bankruptcy Code. Organizational/ Governance Documents The Common Units will be subject to a new limited liability company agreement or agreements (the “New LLC Agreement”) containing terms and conditions that are acceptable in all respects to the Requisite DIP Lenders and the Requisite Lenders. Any holder of a claim that is to be distributed Common Units pursuant to the Plan shall have duly executed and delivered to the Reorganized Company, as an express condition precedent to such holder’s receipt of such Common Units, a counterpart to the New LLC Agreement. The New LLC Agreement and all other organizational or governance documents related to the reorganized company (the “Reorganized Company”), including, but not limited to, the certificate of formation, the operating agreement and/or other organizational documents (the “New Organizational/Governance Documents”), shall be detachablein form and substance acceptable in all respects to the Requisite DIP Lenders and the Requisite Lenders in their sole and absolute discretion. Substantially final forms of the New Organizational/Governance Documents shall be filed as part of the Plan Supplement. On and after the Effective Date, subject the Reorganized Company will be a “private” company (i.e., it will not be required to anti-dilution protections (including (i) adjustments for stock splitsregister any securities pursuant to the Securities Exchange Act of 1934, stock dividends, recapitalizations and similar eventsas amended, and the rules and regulations promulgated thereunder (ii) weighted-average adjustments for issuances of equity and equity-linked securities at prices below the Fair Market Value of Reorganized Group’s common stock (it being understood that for purposes of determining the price at which any such equity or equity-linked securities are issued, any customary underwriting discounts and commissions, liquidity discounts reasonably determined in good faith by the board, placement fees or other similar expenses incurred by Reorganized Group in connection with the issuance thereof shall not be taken into account“Securities Exchange Act”)), and, absent a board or shareholder vote otherwise, shall issue no securities such as would require the Reorganized Company to register any securities pursuant to the Securities Exchange Act; provided, however, the Reorganized Company shall provide such TERM DESCRIPTION financial reporting as determined by the New Board (as defined below). New Board The composition and may be exercised, at the option number of members of the holder, on a cashless basis (x) at such time as the per share equity value equals or exceeds 150% board of managers of the exercise price, Reorganized Company (the “New Board”) shall be determined or selected (as determined applicable) by the Requisite Lenders in accordance with note 4 infra or (y) upon a change of control or registration of securitiestheir sole and absolute discretion. Upon exercise Management Incentive Plan After the closing of the Class 5 Warrants on a cashless basisPlan Transaction, the holder will be entitled to receive New Board may, in its sole and absolute discretion, establish a management incentive plan (the number “Management Incentive Plan”) for the benefit of shares equal to the difference between the value management and managers of the New Equity Reorganized Company. The participants in the Management Incentive Plan, the allocations of Reorganized Group the awards to such participants, and the exercise priceterms and conditions of such awards shall be determined by the New Board in its sole and absolute discretion. Executory Contracts and Unexpired Leases The Class 5 Warrants shall expire on the 5th anniversary of the effective date of the Plan, if not previously exercised. The Class 5 Warrants may be exercised from time to time, in whole or in part, until the expiration thereof. Assumed And Rejected Contracts Unless otherwise provided in the Plan or listed on an exhibit to the Plan, all executory contracts and unexpired leases of the Company and/or the go- forward agreements of the Reorganized Company, including, without limitation, and as applicable, the Revenue Put Agreement (as defined below), the O&M Agreement (as defined below), the Amended O&M Agreement (as defined below), the Services Agreement (as defined below) and the Energy Management Agreement (as defined below), will be addressed in a manner consistent with this Restructuring Term Sheet (or if not addressed herein, as otherwise agreed upon between the Company and the Requisite Lenders). Revenue Put That certain 2002 ISDA Master Agreement, dated as of July 17, 2012, between Employee Retirement Income Plan Trust of Minnesota, Mining and Manufacturing Company acting through 3M Investment Management Corporation and Panda Temple (the “Master Agreement”, and together with all other documents related thereto, including, without limitation, the Schedule to which the Master Agreement and the Confirmation related to the Master Agreement, in each case, as any of the Debtors is a party shall foregoing may be deemed automatically assumed amended, supplemented or otherwise modified from time to time in accordance with the provisions terms thereof, the “Revenue Put Agreement”) shall be addressed in a manner agreed upon between the Company and requirements the Requisite Lenders. For the avoidance of sections 365 and 1123 doubt, in no circumstance may the Revenue Put Agreement be amended, modified, supplemented, terminated or rejected without the consent of the Bankruptcy Code Requisite Lenders. Amended O&M Agreement On or before the Petition Date (or as soon as practicable thereafter, and in any event, prior to the earlier of (i) July 7, 2017 and (ii) the Effective Date date of the Plan. Cure Payments For Executory Contracts And Unexpired Leases Any party to an Executory Contract or Unexpired Lease that wishes to assert that Cure is required as a condition to assumption shall file a proposed cure claim within forty-five days after entry of the Confirmation Order) that certain Operation and Maintenance Agreement, dated as of April 17, 2012 (the “O&M Agreement”), by and between Panda Temple and the Operator (together with any other related agreements entered into by and between the Company and the Operator) shall be amended (the O&M Agreement, as amended as set forth herein, pursuant to the terms of the O&M Term Sheet and as otherwise agreed by the parties, the “Amended O&M Agreement”) in accordance with the term sheet annexed as Exhibit C to the Restructuring Support Agreement (the “O&M Term Sheet”), and the Amended O&M Agreement shall otherwise be in form and substance acceptable in all respects to the Company, the Operator and the Requisite Lenders in their sole and absolute discretion, including, for the avoidance of doubt, with respect to shared synergies with the “Temple II” facility and cost reduction savings, it being understood and agreed that (x) the existence of the O&M Term Sheet and/or entry into the Amended O&M Agreement prior to the Petition Date, as the case may be, shall not affect the right or ability of the Company (at the TERM DESCRIPTION direction of the Requisite Lenders) to subsequently reject the O&M Agreement or the Amended O&M Agreement, as applicable, after which the Petition Date, (y) the Amended O&M Agreement (if entered into prior to the Petition Date) shall only be assumed, if at all, by the Debtors (at the direction of the Requisite Lenders) on and as of the Effective Date, and (z) for the avoidance of doubt, if the O&M Agreement is not amended, the O&M Agreement shall have forty-five days not be assumed by the Debtors unless consented to file by the Requisite Lenders. In addition, if at any objections thereto.time the Operator is replaced by a new operator acceptable to the Requisite Lenders in their sole and absolute discretion (the “Replacement Operator”), the Operator shall cooperate fully and in good faith in any transition of the services under the O&M Agreement or the Amended O&M Agreement, as applicable, to the Replacement Operator, including, without limitation, by turning over to such Replacement Operator all manuals, books and records related to the facility, and by developing joint operational protocols for shared facilities and assets under that certain Shared Facilities Agreement, dated as of April 3, 2013, by and among Panda Temple, Panda Temple Power II, LLC and the Operator. Transfer of Services The Company shall use commercially reasonable efforts to cooperate in the transition to a new manager acceptable to the Requisite Lenders in their sole and absolute discretion (the “New Manager”) of all energy and fuel management and other services under that certain Energy Management Agreement, dated as of July 17, 2012 (as amended, supplemented or otherwise modified from time to time in accordance with the terms thereof, the “Energy Management Agreement”), between Panda Temple and Twin Eagle Resource Management, LLC. The Transaction Parties shall use commercially reasonable efforts to negotiate and facilitate a transition services agreement between Panda Temple and Twin Eagle that is in form and substance reasonably acceptable in all respects to the Requisite Lenders and the Company. The Company shall use commercially reasonable efforts to cooperate with the Reorganized Company and the Consenting Lenders to ensure that all permits, easements, licenses, software, agreements, contracts, information and other items necessary to operate the facility are transitioned to the New Manager and operations are not disrupted. Services Agreement The Asset Manager shall cooperate fully and in good faith in any transition of the services under that certain Amended and Restated Services Agreement, dated as of April 28, 2011 (as amended, supplemented or otherwise modified from time to time in accordance with the terms thereof, the “Services Agreement”), by and between the Asset Manager and Panda Temple, as determined by the Company and the Requisite Lenders, including, without limitation, by delivering electronic copies of all books and records relating to the Company and/or its operations. Releases and Exculpation To the maximum extent permissible by law, the Plan and the order confirming the Plan (the “Confirmation Order”) will contain customary mutual releases and other exculpatory provisions in favor of Panda Holdings I, the Operator, the Asset Manager, the Company, the Reorganized Company, the Consenting Lenders, the DIP Lenders, the DIP Agent (as defined in the DIP Term Sheet), the agents under the Credit Agreement, the Eligible Equity Holders (as defined below) (but solely to the extent the Restructuring Support Agreement has not been terminated prior to the Effective Date and the Effective Date has, in fact, occurred), in each case, that