Exhibit 10.6

 

EXECUTION VERSION

 

SECOND LIEN CREDIT AND GUARANTY AGREEMENT

 

dated as of February 22, 2008

 

among

 

ALDABRA SUB LLC

(to be merged with and into BOISE PAPER HOLDINGS, L.L.C.),

 

ALDABRA HOLDING SUB LLC,

 

CERTAIN SUBSIDIARIES OF ALDABRA SUB LLC,

as Guarantors,

 

VARIOUS LENDERS,

 

LEHMAN COMMERCIAL PAPER INC.,

as Administrative Agent and Collateral Agent,

 

GOLDMAN SACHS CREDIT PARTNERS L.P.,

as Joint Lead Arranger, Joint Bookrunner and Syndication Agent

 

and

 

LEHMAN BROTHERS INC.,

as Joint Lead Arranger, Joint Bookrunner and Documentation Agent

 

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$260,700,000 Senior Secured Second Priority Credit Facility

 

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TABLE OF CONTENTS

 

 

Page

 

 

SECTION 1. DEFINITIONS AND INTERPRETATION

2

1.1. Definitions

2

1.2. Accounting Terms

31

1.3. Interpretation, etc.

32

1.4. Intercreditor Agreement

32

 

 

SECTION 2. LOANS

32

2.1. Loans

32

2.2. Intentionally Omitted

33

2.3. Intentionally Omitted.

33

2.4. Intentionally Omitted

33

2.5. Pro Rata Shares; Availability of Funds

33

2.6. Use of Proceeds

33

2.7. Evidence of Debt; Register; Lenders’ Books and Records; Notes.

34

2.8. Interest on Loans

34

2.9. Conversion/Continuation

36

2.10. Default Interest

36

2.11. Fees

37

2.12. Payment at Maturity.

37

2.13. Voluntary Prepayments; Make-Whole Premium; Call Premium

37

2.14. Mandatory Prepayments

38

2.15. Application of Prepayments

40

2.16. General Provisions Regarding Payments

41

2.17. Ratable Sharing

42

2.18. Making or Maintaining Eurodollar Rate Loans

42

2.19. Increased Costs; Capital Adequacy

44

2.20. Taxes; Withholding, etc.

45

2.21. Obligation to Mitigate

48

2.22. Intentionally Omitted

49

2.23. Removal or Replacement of a Lender

49

 

 

SECTION 3. CONDITIONS PRECEDENT

50

3.1. Closing Date

50

3.2. Notices

55

 

 

SECTION 4. REPRESENTATIONS AND WARRANTIES

56

4.1. Organization; Requisite Power and Authority; Qualification.

56

4.2. Equity Interests and Ownership

56

4.3. Due Authorization

56

4.4. No Conflict

56

4.5. Governmental Consents

57

4.6. Binding Obligation

57

4.7. Historical Financial Statements

57

4.8. Projections

57

 

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4.9. No Material Adverse Change

58

4.10. Reserved

58

4.11. Adverse Proceedings, etc.

58

4.12. Payment of Taxes.

58

4.13. Properties

58

4.14. Environmental Matters

59

4.15. No Defaults

59

4.16. Material Contracts

59

4.17. Governmental Regulation

60

4.18. Margin Stock

60

4.19. Employee Matters

60

4.20. Employee Benefit Plans

60

4.21. Certain Fees

61

4.22. Solvency

61

4.23. Related Agreements

61

4.24. Compliance with Statutes, etc.

61

4.25. Disclosure

61

4.26. Patriot Act

62

 

 

SECTION 5. AFFIRMATIVE COVENANTS

62

5.1. Financial Statements and Other Reports

62

5.2. Existence

66

5.3. Payment of Taxes and Claims

66

5.4. Maintenance of Properties

66

5.5. Insurance

66

5.6. Books and Records; Inspections

67

5.7. Lenders Meetings

67

5.8. Compliance with Laws

68

5.9. Environmental

68

5.10. Subsidiaries

69

5.11. Additional Material Real Estate Assets

70

5.12. Reserved

70

5.13. Further Assurances

70

5.14. Miscellaneous Covenants

71

 

 

SECTION 6. NEGATIVE COVENANTS

71

6.1. Indebtedness

71

6.2. Liens

74

6.3. No Further Negative Pledges

76

6.4. Restricted Junior Payments

76

6.5. Restrictions on Subsidiary Distributions

78

6.6. Investments

79

6.7. Financial Covenants

80

6.8. Fundamental Changes; Disposition of Assets; Acquisitions

81

6.9. Disposal of Subsidiary Interests

83

6.10. Sales and Lease-Backs

83

6.11. Transactions with Shareholders and Affiliates.

83

 

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6.12. Conduct of Business

84

6.13. Permitted Activities of Holdings

84

6.14. Amendments or Waivers of Organizational Documents, Certain Related
Agreements and Certain Other Agreements

85

6.15. Amendments or Waivers with respect to First Lien Credit Agreement

85

6.16. Fiscal Year

85

 

 

SECTION 7. GUARANTY

85

7.1. Guaranty of the Obligations

85

7.2. Contribution by Guarantors

85

7.3. Payment by Guarantors

86

7.4. Liability of Guarantors Absolute

86

7.5. Waivers by Guarantors

88

7.6. Guarantors’ Rights of Subrogation, Contribution, etc.

89

7.7. Subordination of Other Obligations

90

7.8. Continuing Guaranty

90

7.9. Authority of Guarantors or Borrower

90

7.10. Financial Condition of Borrower

90

7.11. Bankruptcy, etc.

90

7.12. Discharge of Guaranty Upon Sale of Guarantor

91

 

 

SECTION 8. EVENTS OF DEFAULT

91

8.1. Events of Default

91

 

 

SECTION 9. AGENTS

94

9.1. Appointment of Agents.

94

9.2. Powers and Duties

94

9.3. General Immunity

95

9.4. Agents Entitled to Act as Lender

96

9.5. Lenders’ Representations, Warranties and Acknowledgment

96

9.6. Right to Indemnity

97

9.7. Successor Administrative Agent and Collateral Agent.

97

9.8. Collateral Documents and Guaranty

98

9.9. Withholding Taxes

99

 

 

SECTION 10. MISCELLANEOUS

99

10.1. Notices

99

10.2. Expenses

100

10.3. Indemnity

101

10.4. Set-Off

102

10.5. Amendments and Waivers

103

10.6. Successors and Assigns; Participations

104

10.7. Independence of Covenants

107

10.8. Survival of Representations, Warranties and Agreements

108

10.9. No Waiver; Remedies Cumulative

108

10.10. Marshalling; Payments Set Aside

108

 

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10.11. Severability

108

10.12. Obligations Several; Independent Nature of Lenders’ Rights

108

10.13. Headings

109

10.14. APPLICABLE LAW

109

10.15. CONSENT TO JURISDICTION

109

10.16. WAIVER OF JURY TRIAL

109

10.17. Confidentiality

110

10.18. Usury Savings Clause

111

10.19. Counterparts

111

10.20. Effectiveness; Entire Agreement

111

10.21. Patriot Act

111

10.22. Electronic Execution of Assignments

112

10.23. No Fiduciary Duty

112

 

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APPENDICES:

 

A             Commitments

 

 

B             Notice Addresses

 

 

 

 

 

SCHEDULES:

 

3.1(h)

 

Closing Date Mortgaged Properties

 

 

3.1(h)(vi)

 

Surveys

 

 

4.1

 

Jurisdictions of Organization and Qualification

 

 

4.2

 

Equity Interests and Ownership

 

 

4.13(a)

 

Real Estate Assets Under Sale Contracts

 

 

4.13(b)

 

Real Estate Assets

 

 

4.16

 

Material Contracts

 

 

4.21

 

Certain Fees

 

 

6.1

 

Certain Indebtedness

 

 

6.2

 

Certain Liens

 

 

6.3

 

Negative Pledges

 

 

6.5

 

Certain Restrictions on Subsidiary Distributions

 

 

6.6

 

Certain Investments

 

 

6.11

 

Certain Affiliate Transactions

 

 

 

 

 

EXHIBITS:

 

A-1

 

Funding Notice

 

 

A-2

 

Conversion/Continuation Notice

 

 

B

 

Note

 

 

C

 

Compliance Certificate

 

 

D

 

Reserved

 

 

E

 

Assignment Agreement

 

 

F

 

Certificate re Non-Bank Status

 

 

G-1

 

Closing Date Certificate

 

 

G-2

 

Solvency Certificate

 

 

H

 

Counterpart Agreement

 

 

I

 

Pledge and Security Agreement

 

 

J

 

Mortgage

 

 

K

 

Landlord Waiver and Consent Agreement

 

 

L

 

Intercompany Note

 

 

M

 

Intercreditor Agreement

 

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SECOND LIEN CREDIT AND GUARANTY AGREEMENT

 

This SECOND LIEN CREDIT AND GUARANTY AGREEMENT, dated as of February 22, 2008,
is entered into by and among ALDABRA SUB LLC, a Delaware limited liability
company (“Aldabra” and, prior to the BPH Merger (as defined below), the
“Borrower”), to be merged with and into BOISE PAPER HOLDINGS, L.L.C., a Delaware
limited liability company (“BPH” and, after the BPH Merger, the “Borrower”),
ALDABRA HOLDING SUB LLC, a Delaware limited liability company (“Holdings”),
CERTAIN SUBSIDIARIES OF ALDABRA, as Guarantors, the Lenders party hereto from
time to time, LEHMAN COMMERCIAL PAPER INC. (“LCPI”), as Administrative Agent
(together with its permitted successors in such capacity, “Administrative
Agent”) and Collateral Agent (together with its permitted successors in such
capacity, “Collateral Agent”), GOLDMAN SACHS CREDIT PARTNERS L.P. (“GSCP”), as
Syndication Agent (together with its permitted successors in such capacity,
“Syndication Agent”), and LEHMAN BROTHERS INC. (“Lehman Brothers”), as
Documentation Agent (together with its permitted successors in such capacity,
“Documentation Agent”).

 

RECITALS:

 

WHEREAS, capitalized terms used in these Recitals shall have the respective
meanings set forth for such terms in Section 1.1 hereof;

 

WHEREAS, Lenders have agreed to extend a term loan credit facility to Borrower,
in an aggregate amount not to exceed $260,700,000, with the proceeds of the
Loans being used to fund (a) in part, the acquisition (the “Acquisition”) of BPH
(together with its Subsidiaries, the “Acquired Business”) pursuant to the
Acquisition Agreement, including the refinancing or retiring of certain existing
Indebtedness for borrowed money of the Acquired Business, and (b) the payment of
fees, commissions and expenses in connection therewith and in connection with
the financing of the foregoing, including fees under Section 2.11(a);

 

WHEREAS, promptly following the Acquisition, Aldabra will merge with and into
BPH with BPH as the survivor in such merger (the “BPH Merger”), and BPH will be
the Borrower hereunder;

 

WHEREAS, Borrower has agreed to secure all of its Obligations by granting to
Collateral Agent, for the benefit of Secured Parties, a Second Priority Lien on
substantially all of its assets, including a pledge of all of the Equity
Interests of each of its Domestic Subsidiaries and 65% of all the Equity
Interests of each of its first-tier Foreign Subsidiaries; and

 

WHEREAS, Guarantors have agreed to guarantee the obligations of Borrower
hereunder and to secure their respective Obligations by granting to Collateral
Agent, for the benefit of Secured Parties, a Second Priority Lien on
substantially all of their respective assets, including a pledge of all of the
Equity Interests of each of their respective Domestic Subsidiaries (including
Borrower) and 65% of all the Equity Interests of each of their respective
first-tier Foreign Subsidiaries.

 

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NOW, THEREFORE, in consideration of the premises and the agreements, provisions
and covenants herein contained, the parties hereto agree as follows:

 

SECTION 1.   DEFINITIONS AND INTERPRETATION

 

1.1.   Definitions.  The following terms used herein, including in the preamble,
recitals, exhibits and schedules hereto, shall have the following meanings:

 

“Acquired Business” as defined in the recitals hereof.

 

“Acquisition” as defined in the recitals hereof.

 

“Acquisition Agreement” shall mean the Purchase and Sale Agreement dated as of
September 7, 2007 among Boise Cascade, L.L.C., BPH, Boise White Paper, L.L.C.,
Boise Packaging & Newsprint, L.L.C., Boise Cascade Transportation Holdings
Corp., Parent and Aldabra, as amended pursuant to Amendment No. 1 to Purchase
and Sale Agreement dated as of October 18, 2007, as further amended pursuant to
Amendment No. 2 to Purchase and Sale Agreement dated as of February 22, 2008,
and as further amended, restated, supplemented or otherwise modified from time
to time in accordance with Section 6.14 hereof.

 

“Acquisition Consideration” shall mean the purchase consideration for any
Permitted Acquisition and all other payments by Holdings or any of its
Subsidiaries in exchange for, or as part of, or in connection with, any
Permitted Acquisition, whether paid in cash or by exchange of Equity Interests
or of properties or otherwise and whether payable at or prior to the
consummation of such Permitted Acquisition or deferred for payment at any future
time, whether or not any such future payment is subject to the occurrence of any
contingency, and includes any and all payments representing the purchase price
and any assumptions of Indebtedness, “earn-outs” and other agreements to make
any payment the amount of which is, or the terms of payment of which are, in any
respect subject to or contingent upon the revenues, income, cash flow or profits
(or the like) of any person or business; provided that any such future payment
that is subject to a contingency shall be considered Acquisition Consideration
only to the extent of the reserve, if any, required under GAAP at the time of
such sale to be established in respect thereof by Holdings or any of its
Subsidiaries.

 

“Adjusted Eurodollar Rate” means, for any Interest Rate Determination Date with
respect to an Interest Period for a Eurodollar Rate Loan, the rate per annum
obtained by dividing (and rounding upward to the next whole multiple of 1/16 of
1%) (i) (a) the rate per annum (rounded to the nearest 1/100 of 1%) equal to the
rate determined by Administrative Agent to be the offered rate which appears on
the page of the Reuters Screen which displays an average British Bankers
Association Interest Settlement Rate (such page currently being LIBOR01 page)
for deposits (for delivery on the first day of such period) with a term
equivalent to such period in Dollars, determined as of approximately 11:00 a.m.
(London, England time) on such Interest Rate Determination Date, or (b) in the
event the rate referenced in the preceding clause (a) does not appear on such
page or service or if such page or service shall cease to be available, the rate
per annum (rounded to the nearest 1/100 of 1%) equal to the rate determined by
Administrative Agent to be the offered rate on such other page or other service
which displays

 

2

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an average British Bankers Association Interest Settlement Rate for deposits
(for delivery on the first day of such period) with a term equivalent to such
period in Dollars, determined as of approximately 11:00 a.m. (London, England
time) on such Interest Rate Determination Date, or (c) in the event the rates
referenced in the preceding clauses (a) and (b) are not available, the rate per
annum (rounded to the nearest 1/100 of 1%) equal to the offered quotation rate
to first class banks in the London interbank market by JPMorgan Chase Bank, N.A.
for deposits (for delivery on the first day of the relevant period) in Dollars
of amounts in same day funds comparable to the principal amount of the
applicable Loan of Administrative Agent, in its capacity as a Lender, for which
the Adjusted Eurodollar Rate is then being determined with maturities comparable
to such period as of approximately 11:00 a.m. (London, England time) on such
Interest Rate Determination Date, by (ii) an amount equal to (a) one minus
(b) the Applicable Reserve Requirement.  In no event shall the rate per annum
determined pursuant to clause (i)(a), (b) or (c) above be less than 5.50%.

 

“Administrative Agent” as defined in the preamble hereto.

 

“Adverse Proceeding” means any action, suit, proceeding or governmental
investigation (whether or not purportedly on behalf of Holdings or any of its
Subsidiaries) at law or in equity, or before or by any arbitrator or
Governmental Authority, domestic or foreign (including any Environmental
Claims), whether pending or, to the knowledge of Holdings or any of its
Subsidiaries, threatened against or affecting Holdings or any of its
Subsidiaries or any property of Holdings or any of its Subsidiaries.

 

“Affected Lender” as defined in Section 2.18(b).

 

“Affected Loans” as defined in Section 2.18(b).

 

“Affiliate” means, as applied to any Person, any other Person directly or
indirectly controlling, controlled by, or under common control with, that
Person. For the purposes of this definition, “control” (including, with
correlative meanings, the terms “controlling”, “controlled by” and “under common
control with”), as applied to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of that Person, whether through the ownership of voting securities or
by contract or otherwise.

 

“Agent” means each of Administrative Agent, Syndication Agent, Collateral Agent
and Documentation Agent.

 

“Agent Affiliates” as defined in Section 10.1(b).

 

“Aggregate Amounts Due” as defined in Section 2.17.

 

“Aggregate Payments” as defined in Section 7.2.

 

“Agreement” means this Second Lien Credit and Guaranty Agreement, dated as of
February 22, 2008, as it may be amended, restated, supplemented or otherwise
modified from time to time.

 

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“Aldabra” as defined in the preamble hereto.

 

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

 

“Approved Electronic Communications” means any notice, demand, communication,
information, document or other material that any Credit Party provides to
Administrative Agent pursuant to any Credit Document or the transactions
contemplated therein which is distributed to the Agents or to the lenders by
means of electronic communications pursuant to Section 10.1(b).

 

“Arrangers” means GSCP and Lehman Brothers.

 

“Asset Sale” means a sale, lease or sub-lease (as lessor or sublessor), sale and
leaseback, assignment, conveyance, Exclusive IP License (as licensor or
sublicensor), transfer or other disposition to, or any exchange of property
with, any Person (other than Borrower or any Guarantor Subsidiary), in one
transaction or a series of transactions, of all or any part of Holdings’ or any
of its Subsidiaries’ businesses, assets or properties of any kind, whether real,
personal, or mixed and whether tangible or intangible, whether now owned or
hereafter acquired, leased or licensed, including the Equity Interests of any of
Holdings’ Subsidiaries, other than (i) inventory (or other assets) sold, leased
or licensed out in the ordinary course of business (excluding any such sales,
leases or licenses out by operations or divisions discontinued or to be
discontinued), (ii) Cash or Cash Equivalents used in the ordinary course of
business, (iii) transactions permitted by Section 6.4 (to the extent such
Restricted Junior Payment involves a sale, transfer or disposition of assets) or
Section 6.6 (to the extent such Investment involves a sale, transfer or
disposition of assets), (iv) Permitted Operating Asset Swaps, (v) the disposal
or abandonment of property no longer used or useful in the business of any
Credit Party in an amount for any transaction or related series of transactions
less than $100,000, (vi) sales, discounting or forgiveness of accounts
receivables in connection with the collection or compromise thereof, (vii) the
granting of Liens permitted by Section 6.2, (viii) transfers of property subject
to casualty or condemnation proceedings (including in lieu thereof) upon the
receipt of the Net Insurance/Condemnation Proceeds therefor, provided, that the
Credit Parties shall comply with this Agreement with respect to the application
of such Net Insurance/Condemnation Proceeds, (ix) voluntary terminations of
Hedge Agreements, (x)

 

4

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licensing of Intellectual Property granted by Holdings or any of its
Subsidiaries in the ordinary course of business, or not interfering in any
respect with the ordinary conduct of, or not materially detracting from the
value of, the business of the Borrower or such Subsidiary, and (xi) sales,
leases or licenses out of other assets for aggregate consideration of less than
$1,000,000 with respect to any transaction or series of related transactions and
less than $5,000,000 in the aggregate during any Fiscal Year.

 

“Assignment Agreement” means an Assignment and Assumption Agreement
substantially in the form of Exhibit E, with such amendments or modifications as
may be reasonably approved by Administrative Agent.

 

“Assignment Effective Date” as defined in Section 10.6(b).

 

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

 

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

 

“Base Rate” means, for any day, a rate per annum equal to the greater of (i) the
Prime Rate in effect on such day and (ii) the Federal Funds Effective Rate in
effect on such day plus ½ of 1%.  Any change in the Base Rate due to a change in
the Prime Rate or the Federal Funds Effective Rate shall be effective on the
effective day of such change in the Prime Rate or the Federal Funds Effective
Rate, respectively.

 

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

 

“Beneficiary” means each Agent and each Lender.

 

“Board of Governors” means the Board of Governors of the United States Federal
Reserve System, or any successor thereto.

 

“Borrower” as defined in the preamble hereto.

 

“BPH” as defined in the preamble hereto.

 

“BPH Merger” as defined in the recitals hereof.

 

“Business Day” means (i) any day excluding Saturday, Sunday and any day which is
a legal holiday under the laws of the State of New York or is a day on which
banking institutions located in such state are authorized or required by law or
other governmental action to close and (ii) with respect to all notices,
determinations, fundings and payments in connection with the Adjusted Eurodollar
Rate or any Eurodollar Rate Loans, the term “Business Day” shall

 

5

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mean any day which is a Business Day described in clause (i) and which is also a
day for trading by and between banks in Dollar deposits in the London interbank
market.

 

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

 

“Cash” means money, currency or a credit balance in any demand or Deposit
Account.

 

“Cash Equivalents” means, as at any date of determination, (i) marketable
securities (a) issued or directly and unconditionally guaranteed as to interest
and principal by the United States Government or (b) issued by any department,
instrumentality or agency of the United States the obligations of which are
backed by the full faith and credit of the United States, in each case maturing
within one year after such date; (ii) marketable direct obligations issued by
any state of the United States of America or any political subdivision of any
such state or any public instrumentality thereof, in each case maturing within
one year after such date and having, at the time of the acquisition thereof, a
rating of at least A-2 from S&P or at least P-2 from Moody’s; (iii) commercial
paper maturing no more than one year from the date of acquisition thereof and
having, at the time of the acquisition thereof, a rating of at least A-2 from
S&P or at least P-2 from Moody’s; (iv) certificates of deposit, bankers’
acceptances or time deposits maturing within one year from the date of
acquisition thereof and issued or accepted by any Lender or by any commercial
bank organized under the laws of the United States of America or any state
thereof or the District of Columbia that (a) is at least “adequately
capitalized” (as defined in the regulations of its primary Federal banking
regulator) and (b) has Tier 1 capital (as defined in such regulations) of not
less than $100,000,000; (v) shares of any money market mutual fund that has
substantially all of its assets invested continuously in the types of
investments referred to in clauses (i) through (iv) above; (vi) fully
collateralized repurchase agreements with a term of not more than 30 days for
securities described in clauses (i) and (ii) above and entered into with a
financial institution satisfying the criteria described in clause (iv) above;
and (vii) demand deposit accounts with commercial banks.

 

“Certificate re Non-Bank Status” means a certificate substantially in the form
of Exhibit F.

 

“Change of Control” means (i) any Person or “group” (within the meaning of
Rules 13d-3 and 13d-5 under the Exchange Act) other than the Permitted Investors
(x) shall have obtained the power (whether or not exercised) to vote a majority
of the shares eligible to vote for the election of the members of the board of
directors (or similar governing body) of Parent or (y) (a) shall have acquired
beneficial ownership of 35% or more on a fully diluted basis of the voting
and/or economic interest in the Equity Interests of Parent and (b) shall have
acquired beneficial ownership of the voting and/or economic interests in the
Equity Interests of Parent on a fully-diluted basis that is greater than the
percentage of the voting and/or economic interests in the Equity Interests of
Parent on a fully-diluted basis then held by the Permitted Investors; (ii) at
any time, Parent shall cease to beneficially own and control, directly or
indirectly, 100% on a fully diluted basis of the economic and voting interest in
the Equity Interests of Borrower; (iii) the majority of the seats (other than
vacant seats) on the board of directors (or similar governing

 

6

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body) of Parent cease to be occupied by Persons who either (a) were members of
the board of directors of Parent on the Closing Date or (b) were nominated for
election or appointed by the board of directors of Parent, a majority of whom
were directors on the Closing Date or whose election, nomination for election or
appointment was previously approved by a majority of such directors; or (iv) any
“change of control” or similar event under the First Lien Credit Agreement shall
occur.

 

“Closing Date” means February 22, 2008.

 

“Closing Date Certificate” means a Closing Date Certificate substantially in the
form of Exhibit G-1.

 

“Closing Date Mortgaged Property” as defined in Section 3.1(h).

 

“Collateral” means, collectively, all of the real, personal and mixed property
(including Equity Interests) in which Liens are purported to be granted pursuant
to the Collateral Documents as security for the Obligations.

 

“Collateral Agent” as defined in the preamble hereto.

 

“Collateral Documents” means the Pledge and Security Agreement, the Mortgages,
the Intellectual Property Security Agreements, the Landlord Personal Property
Collateral Access Agreements, if any, and all other instruments, documents and
agreements delivered by any Credit Party pursuant to this Agreement or any of
the other Credit Documents in order to grant to Collateral Agent, for the
benefit of Secured Parties, a Lien on any real, personal or mixed property of
that Credit Party as security for the Obligations.

 

“Collateral Questionnaire” means a certificate in form reasonably satisfactory
to Collateral Agent that provides information with respect to the Collateral of
each Credit Party.

 

“Commitment” means the commitment of a Lender to make or otherwise fund a Loan
and “Commitments” means such commitments of all Lenders in the aggregate.  The
amount of each Lender’s Commitment, if any, is set forth on Appendix A or in the
applicable Assignment Agreement, subject to any adjustment or reduction pursuant
to the terms and conditions hereof.  The aggregate amount of the Commitments as
of the Closing Date is $260,700,000.

 

“Commitment Letter” means the Amended and Restated Commitment Letter dated
November 2, 2007 among Aldabra, GSCP, Lehman Brothers and LCPI.

 

“Commodity Agreement” means any commodity futures contract, forward contract,
option to purchase or sell a commodity, or option, warrant or other right with
respect to a commodity futures contract or other similar agreement or
arrangement, each of which is for the purpose of hedging the risk of
fluctuations in commodities prices associated with the businesses of Holdings
and its Subsidiaries and not for speculative purposes.

 

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

 

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“Consolidated Adjusted EBITDA” means, for any period, an amount determined for
Holdings and its Subsidiaries on a consolidated basis equal to (i) Consolidated
Net Income, plus, except in the case of clauses (s) and (t) below, to the extent
reducing Consolidated Net Income, the sum, without duplication, of amounts for
(a) consolidated interest expense (net of total interest income), (b) provisions
for taxes based on income, (c) total depreciation and depletion expense,
(d) total amortization expense, (e) lost contribution and incremental costs
associated with Wallula 30 day downtime due to the W-3 conversion in excess of
costs normally incurred during prior periods that include cold outages in an
amount not to exceed $4,000,000, (f) costs associated with the closure and sale
of Jackson Sawmill and the Vancouver and Salem converting facilities in an
amount not to exceed $6,100,000, (g) cost savings resulting from the CTC
acquisition relating to the elimination of the negative impact associated with a
contractual commitment to buy liner and medium from a third party supplier that
was previously in place in an amount not to exceed $300,000, (h) costs relating
to out of the money gas hedges based upon a historical policy of entering into
fixed rate gas hedges in an amount not to exceed $16,800,000, (i) cost savings
relating to the Wallula Hog Fuel Boiler capital project in the event it is
operational as of the Closing Date in an amount not to exceed $2,600,000,
(j) costs and lost revenue associated with the cold outage of the recovery
boiler at the DeRidder Mill, (k) Transaction Costs, (l) severance costs,
facility closure and related restructuring costs incurred within 18 months of
the Closing Date, in an aggregate amount for all periods not to exceed
$10,000,000, (m) any non-recurring costs and expenses related to (1) any public
or private offering of Equity Interests of Holdings or Borrower, (2) any
investment or acquisition permitted by Section 6.6 or (3) recapitalizations or
Indebtedness permitted by Section 6.1, (n) any unrealized Statement of Financial
Accounting Standards No. 133 loss in respect of any Hedge Agreement, (o) any
non-cash losses attributable to the early extinguishment of Indebtedness,
(p) unusual or non-recurring non-cash losses, (q) other non-cash charges
reducing Consolidated Net Income (excluding any such non-cash charge to the
extent that it represents an accrual or reserve for potential cash charge in any
future period or amortization of a prepaid cash charge that was paid in a prior
period), (r) to the extent covered by insurance and actually reimbursed or
otherwise paid, or so long as the Borrower has made a determination that there
exists reasonable evidence that such amount will in fact be reimbursed or
otherwise paid by the insurer within 12 months of the applicable liability or
casualty event or incurrence of expenses or losses relating to business
interruption, expenses with respect to liability or casualty events and expenses
or losses relating to business interruption, (s) expenses to the extent covered
by contractual indemnification or refunding provisions in favor of Holdings or
one of its Subsidiaries and actually paid or refunded, or, such expenses so long
as Holdings or the Borrower has made a determination that there exists
reasonable evidence that such amount will in fact be paid or refunded by the
indemnifying party or other obligor within 12 months of the event resulting in
such indemnification or refund; (t) all costs, fees, expenses and any one time
payments made related to any Permitted Acquisitions and (u) all non-cash losses
resulting from any purchase accounting adjustments, amortization, write-up,
write-down or write-off of assets (including intangible assets, goodwill and
deferred financing costs) in connection with the Acquisition and related
transactions thereto, any Permitted Acquisition or any merger, consolidation or
similar transaction not prohibited by this Agreement, minus (ii) (a) any
unrealized Statement of Financial Accounting Standards No. 133 gain in respect
of any Hedge Agreement, (b) any non-cash gains attributable to the early
extinguishment of Indebtedness, (c) unusual or non-recurring non-cash gains,
(d) all non-cash gains resulting from any purchase

 

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accounting adjustments, amortization, write-up, write-down or write-off of
assets (including intangible assets, goodwill and deferred financing costs) in
connection with the Acquisition and related transactions thereto, any Permitted
Acquisition or any merger, consolidation or similar transaction not prohibited
by this Agreement, (e) any amount added pursuant to clause (r) above, but not
actually reimbursed to or otherwise received by the Borrower within 12 months of
the applicable liability or casualty event or incurrence of expenses or losses
relating to business interruption, (f) any amount added pursuant to clause
(s) above, but not actually refunded to or received by the Borrower within 12
months of the event resulting in such indemnification or refund; and (g) other
non-cash gains increasing Consolidated Net Income for such period (excluding any
such non-cash gain to the extent it represents the reversal of an accrual or
reserve for potential cash gain in any prior period). For purposes of
calculating the financial covenant in Section 6.7(b), Consolidated Adjusted
EBITDA (i) shall be adjusted in accordance with Section 6.7(d) and (ii) shall be
deemed to be $73,177,000 for the Fiscal Quarter ended September 30, 2007 and
$68,949,000 for the Fiscal Quarter ended December 31, 2007.

 

“Consolidated Capital Expenditures” means, for any period, the aggregate of all
expenditures of Holdings and its Subsidiaries made during such period determined
on a consolidated basis that, in accordance with GAAP, are or should be included
in “purchase of property and equipment” or similar items reflected in the
consolidated statement of cash flows of Holdings and its Subsidiaries; provided
that Consolidated Capital Expenditures shall not include (i) the purchase price
paid in connection with a Permitted Acquisition, (ii) expenditures made pursuant
to any election to apply Net Asset Sale Proceeds or Net Insurance/Condemnation
Proceeds to acquire assets as contemplated by the provisos to
Section 2.14(a) and 2.14(b), (iii) the non-cash consideration transferred or
disposed of in connection with a Permitted Operating Asset Swap, (iv) any
Specified Investment, (v) expenditures made in leasehold improvements, to the
extent reimbursed by the landlord, (vi) expenditures to the extent that they are
actually paid for by a third party (excluding any Credit Party) and for which no
Credit Party has provided or is required to provide or incur, directly or
indirectly, any consideration or monetary obligation to such third party or any
other Person (whether before, during or after such period) and (vii) property,
plant and equipment taken in settlement of accounts.

 

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

 

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

 

“Consolidated Excess Cash Flow” means, for any period, an amount (if positive)
equal to: (i) the sum, without duplication, of the amounts for such period of
(a) Consolidated Adjusted EBITDA, plus (b) the Consolidated Working Capital
Adjustment, minus (ii) the sum, without duplication, of the amounts for such
period paid in cash from operating cash flow of (a) scheduled repayments of
Indebtedness for borrowed money and scheduled repayments of obligations under
Capital Leases (excluding any interest expense portion thereof),
(b) Consolidated Capital Expenditures (net of any proceeds of (y) any related
financings with

 

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respect to such expenditures and (z) any sales of assets used to finance such
expenditures), (c) Consolidated Interest Expense, (d) provisions for current
taxes based on income of Holdings and its Subsidiaries and payable in cash with
respect to such period, (e) the aggregate amount of consideration to be paid in
cash during such period for Permitted Acquisitions to the extent not financed
(x) by incurring Indebtedness that, in accordance with GAAP, constitutes a
long-term liability, (y) with the Net Asset Sale Proceeds or Net
Insurance/Condemnation Proceeds of prepayment events described in Section 2.14
hereof or (z) with the proceeds from the issuance of Equity Interests, (f) the
amount of any expenses related to severance costs, facility closure and related
restructuring costs incurred in connection with the Acquisition and paid within
18 months of the Closing Date by any of Holdings, Borrower or its Subsidiaries
which expenses are not otherwise deducted in calculating the Consolidated Net
Income of Holdings, Borrower and its consolidated Subsidiaries as a result of
the application of purchase accounting principles and (g) the amount of any
costs, fees, expenses and one time payments made related to any Permitted
Acquisition and paid within 18 months of the date of consummation of such
Permitted Acquisition by any of Holdings, Borrower or its Subsidiaries which
expenses are not otherwise deducted in calculating the Consolidated Net Income
of Holdings, Borrower and its consolidated Subsidiaries.

 

“Consolidated Interest Expense” means, for any period, total interest expense
(including that portion attributable to Capital Leases in accordance with GAAP
and capitalized interest), net of total interest income, of Holdings and its
Subsidiaries on a consolidated basis with respect to all outstanding
Indebtedness of Holdings and its Subsidiaries, including all commissions,
discounts and other fees and charges owed with respect to letters of credit and
net costs and benefits under Interest Rate Agreements, but excluding, however,
any amount not payable in cash and any amounts referred to in Sections
2.11(a) and 2.11(b) payable on or before the Closing Date; provided that for
calculations for any four Fiscal Quarter period ending on or prior to
December 31, 2008, the Consolidated Interest Expense of Holdings and its
Subsidiaries shall be deemed to be the product of (i) such amounts from and
including the Closing Date through and including the last day of the applicable
period, respectively, multiplied by (ii) a fraction of which the numerator is
365 and the denominator of which is the number of days elapsed in the period
from and including the Closing Date through and including the last day of the
applicable period.

 

“Consolidated Net Income” means, for any period, (i) the net income (or loss) of
Holdings and its Subsidiaries on a consolidated basis for such period taken as a
single accounting period determined in conformity with GAAP, minus (ii) (a) the
income (or loss) of any Person (other than a Subsidiary of Holdings) in which
any other Person (other than Holdings or any of its Subsidiaries) has a joint
interest, except to the extent of the amount of dividends or other distributions
actually paid to Holdings or any of its Subsidiaries by such Person during such
period, (b) the income (or loss) of any Person accrued prior to the date it
becomes a Subsidiary of Holdings or is merged into or consolidated with Holdings
or any of its Subsidiaries or that Person’s assets are acquired by Holdings or
any of its Subsidiaries, (c) the income of any Subsidiary of Holdings to the
extent that the declaration or payment of dividends or similar distributions by
that Subsidiary of that income is not at the time permitted by operation of the
terms of its charter or any agreement, instrument, judgment, decree, order,
statute, rule or governmental regulation applicable to that Subsidiary, (d) any
after-tax gains or losses attributable to Asset Sales or returned surplus assets
of any Pension Plan, and (e) (to the extent

 

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not included in clauses (a) through (d) above) any net extraordinary gains or
net extraordinary losses.

 

“Consolidated Total Debt” means, as of any date of determination, (a) the
aggregate stated balance sheet amount of all Indebtedness of Holdings and its
Subsidiaries, determined on a consolidated basis in accordance with GAAP minus
(b) the lesser of (i) the aggregate amount of cash and Cash Equivalents (in each
case, free and clear of all Liens, other than nonconsensual Liens permitted by
Section 6.2), included in the consolidated balance sheet of Holdings and its
Subsidiaries as of such date and (ii) $35,000,000.

 

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

 

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

 

“Contractual Obligation” means, as applied to any Person, any provision of any
Security issued by that Person or of any indenture, mortgage, deed of trust,
contract, undertaking, agreement or other instrument to which that Person is a
party or by which it or any of its properties is bound or to which it or any of
its properties is subject.

 

“Contributing Guarantors” as defined in Section 7.2.

 

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

 

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

 

“Counterpart Agreement” means a Counterpart Agreement substantially in the form
of Exhibit H delivered by a Credit Party pursuant to Section 5.10.

 

“Credit Document” means any of this Agreement, the Notes, if any, the Collateral
Documents, the Intercreditor Agreement, the Post-Closing Agreement, and all
other documents, instruments or agreements executed and delivered by a Credit
Party for the benefit of any Agent or any Lender in connection herewith on or
after the date hereof.

 

“Credit Extension” means the making of a Loan (it being understood that the
continuation or conversion of a borrowing does not constitute the making of a
Loan).

 

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

 

“Currency Agreement” means any foreign exchange contract, currency swap
agreement, futures contract, option contract, synthetic cap or other similar
agreement or arrangement, each of which is for the purpose of hedging the
foreign currency risk associated with Holdings’ and its Subsidiaries’ operations
and not for speculative purposes.

 

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

 

“Deposit Account” means a demand, time, savings, passbook or like account with a
bank, savings and loan association, credit union or like organization, other
than an account evidenced by a negotiable certificate of deposit.

 

“Discharge of First Lien Obligations” has the meaning assigned to that term in
the Intercreditor Agreement.

 

“Disqualified Equity Interests” means any Equity Interest which, by its terms
(or by the terms of any security or other Equity Interests into which it is
convertible or for which it is exchangeable), or upon the happening of any event
or condition (i) matures or is mandatorily redeemable (other than solely for
Equity Interests which are not otherwise Disqualified Equity Interests),
pursuant to a sinking fund obligation or otherwise, (ii) is redeemable at the
option of the holder thereof (other than solely for Equity Interests which are
not otherwise Disqualified Equity Interests), in whole or in part,
(iii) provides for scheduled payments or dividends in Cash, or (iv) is
convertible into or exchangeable at the option of the holder for Indebtedness
(other than Subordinated Indebtedness) or any other Equity Interests that would
constitute Disqualified Equity Interests, in each case, prior to the date that
is 91 days after the Maturity Date, except if as a result of a change of control
or asset sale, so long as any rights of the holders thereof upon the occurrence
of such a change of control or asset sale event are subject to the prior payment
in full of all Obligations (other than contingent obligations for which no claim
has been made), unless the Requisite Lenders shall have otherwise agreed;
provided, that if such Equity Interests are issued to any plan for the benefit
of employees of Holdings or its Subsidiaries or by any such plan to such
employees, such Equity Interests shall not constitute Disqualified Equity
Interests solely because they may be required to be repurchased in order to
satisfy applicable statutory or regulatory obligations.

 

“Documentation Agent” as defined in the preamble hereto.

 

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

 

“Domestic Subsidiary” means any Subsidiary organized under the laws of the
United States of America, any State thereof or the District of Columbia.

 

“Eligible Assignee” means (i) any Lender, any Affiliate of any Lender and any
Related Fund (any two or more Related Funds being treated as a single Eligible
Assignee for all purposes hereof), and (ii) any commercial bank, insurance
company, investment or mutual fund or other entity that is an “accredited
investor” (as defined in Regulation D under the Securities Act) and which
extends credit or buys loans; provided, no Affiliate of Holdings shall be an
Eligible Assignee.

 

“Eligible Swap Assets” means, in the case of a Permitted Operating Asset Swap,
assets constituting warehousing or distribution facilities (including any
related equipment and interests in real property associated therewith).

 

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“Employee Benefit Plan” means any “employee benefit plan” as defined in
Section 3(3) of ERISA which is or was sponsored, maintained or contributed to
by, or required to be contributed by, Holdings, any of its Subsidiaries or any
of their respective ERISA Affiliates.

 

“Environmental Claim” means any investigation, notice, notice of violation,
claim, action, suit, proceeding, demand, abatement order or other order or
directive (conditional or otherwise), by any Governmental Authority or any other
Person, arising (i) pursuant to or in connection with any actual or alleged
violation of any Environmental Law; (ii) in connection with any Hazardous
Materials or any actual or alleged Hazardous Materials Activity; or (iii) in
connection with any actual or alleged damage, injury, threat or harm to health,
safety, natural resources or the environment.

 

“Environmental Laws” means any and all current or future foreign or domestic,
federal or state (or any subdivision of either of them), statutes, ordinances,
orders, rules, regulations, judgments, Governmental Authorizations, or any other
requirements of Governmental Authorities relating to (i) environmental matters,
including those relating to any Hazardous Materials Activity; (ii) the
generation, use, storage, transportation or disposal of Hazardous Materials; or
(iii) occupational safety and health, industrial hygiene, land use or the
protection of human health or welfare, in any manner applicable to Holdings or
any of its Subsidiaries or any Facility.

 

“Equity Contribution” means (i) cash common equity investments in Holdings by
Parent, which cash is then contributed by Holdings to Borrower and (ii) the
receipt of Equity Interests in Parent by Seller (valuing such Equity Interests
in Parent at the Average Trading Price (as defined in the Acquisition Agreement)
and treating, for this purpose, the value of such Equity Interests in Parent as
being part of the pro forma capitalization of Borrower), in each case on terms
and conditions reasonably satisfactory to Administrative Agent, in an aggregate
amount equal to not less than 42.8% (or such lesser percentage as may result
from the exercise of conversion rights and/or additional borrowings to fund
conversion rights) of the pro forma capitalization of Borrower after
consummation of the Acquisition.

 

“Equity Interests” means any and all shares, interests, participations or other
equivalents (however designated) of capital stock of a corporation, any and all
equivalent ownership interests in a Person (other than a corporation), including
partnership interests and membership interests, and any and all warrants, rights
or options to purchase or other arrangements or rights to acquire any of the
foregoing.

 

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

 

“ERISA Affiliate” means, as applied to any Person, (i) any corporation which is
a member of a controlled group of corporations within the meaning of
Section 414(b) of the Internal Revenue Code of which that Person is a member;
(ii) any trade or business (whether or not incorporated) which is a member of a
group of trades or businesses under common control within the meaning of
Section 414(c) of the Internal Revenue Code of which that Person is a member;
and (iii) any member of an affiliated service group within the meaning of
Section 414(m) or (o) of the Internal Revenue Code of which that Person, any
corporation described in

 

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clause (i) above or any trade or business described in clause (ii) above is a
member.  Any former ERISA Affiliate of Holdings or any of its Subsidiaries shall
continue to be considered an ERISA Affiliate of Holdings or any such Subsidiary
within the meaning of this definition with respect to the period such entity was
an ERISA Affiliate of Holdings or such Subsidiary and with respect to
liabilities arising after such period for which Holdings or such Subsidiary
could be liable under the Internal Revenue Code or ERISA.

 

“ERISA Event” means (i) a “reportable event” within the meaning of Section 4043
of ERISA and the regulations issued thereunder with respect to any Pension Plan
(excluding those for which the provision for 30-day notice to the PBGC has been
waived by regulation); (ii) the failure to meet the minimum funding standard of
Section 412 of the Internal Revenue Code with respect to any Pension Plan
(whether or not waived in accordance with Section 412(c) of the Internal Revenue
Code) or the failure to make by its due date a required installment under
Section 430(j) of the Internal Revenue Code with respect to any Pension Plan or
the failure to make any required contribution to a Multiemployer Plan; (iii) the
provision by the administrator of any Pension Plan pursuant to
Section 4041(a)(2) of ERISA of a notice of intent to terminate such plan in a
distress termination described in Section 4041(c) of ERISA; (iv) the withdrawal
by Holdings, any of its Subsidiaries or any of their respective ERISA Affiliates
from any Pension Plan with two or more contributing sponsors or the termination
of any such Pension Plan resulting in liability to Holdings, any of its
Subsidiaries or any of their respective Affiliates pursuant to Section 4063 or
4064 of ERISA; (v) the institution by the PBGC of proceedings to terminate any
Pension Plan, or the occurrence of any event or condition which might constitute
grounds under ERISA for the termination of, or the appointment of a trustee to
administer, any Pension Plan; (vi) the imposition of liability on Holdings, any
of its Subsidiaries or any of their respective ERISA Affiliates pursuant to
Section 4062(e) or 4069 of ERISA or by reason of the application of
Section 4212(c) of ERISA; (vii) the withdrawal of Holdings, any of its
Subsidiaries or any of their respective ERISA Affiliates in a complete or
partial withdrawal (within the meaning of Sections 4203 and 4205 of ERISA) from
any Multiemployer Plan if there is any potential liability therefore, or the
receipt by Holdings, any of its Subsidiaries or any of their respective ERISA
Affiliates of notice from any Multiemployer Plan that it is in reorganization or
insolvency pursuant to Section 4241 or 4245 of ERISA, or that it intends to
terminate or has terminated under Section 4041A or 4042 of ERISA; (viii) the
occurrence of an act or omission which could give rise to the imposition on
Holdings, any of its Subsidiaries or any of their respective ERISA Affiliates of
fines, penalties, taxes or related charges under Chapter 43 of the Internal
Revenue Code or under Section 409, Section 502(c), (i) or (l), or Section 4071
of ERISA in respect of any Employee Benefit Plan; (ix) the assertion of a
material claim (other than routine claims for benefits) against any Employee
Benefit Plan other than a Multiemployer Plan or the assets thereof, or against
Holdings, any of its Subsidiaries or any of their respective ERISA Affiliates in
connection with any Employee Benefit Plan; (x) receipt from the Internal Revenue
Service of notice of the failure of any Pension Plan (or any other Employee
Benefit Plan intended to be qualified under Section 401(a) of the Internal
Revenue Code) to qualify under Section 401(a) of the Internal Revenue Code, or
the failure of any trust forming part of any Pension Plan to qualify for
exemption from taxation under Section 501(a) of the Internal Revenue Code; or
(xi) the imposition of a Lien pursuant to Section 430(k) of the Internal Revenue
Code or ERISA or a violation of Section 436 of the Internal Revenue Code with
respect to any Pension Plan.

 

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“Eurodollar Rate Loan” means a Loan bearing interest at a rate determined by
reference to the Adjusted Eurodollar Rate.

 

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

 

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

 

“Exclusive IP License” means any license or sublicense pursuant to which a
Credit Party grants to any Person (other than Borrower or any Guarantor
Subsidiary) an exclusive right and license to all or any part of Holdings’ or
any of its Subsidiaries’ Intellectual Property (whether now owned or hereafter
acquired or licensed) (i) that has an initial term (including any renewal terms
pursuant to a unilateral right of the licensee or sublicensee to renew) longer
than ten (10) years, (ii) that is fully paid, is royalty free or bears a nominal
or substantially below market royalty rate and (iii) that is not subject to any
territorial limitations.

 

“Existing Indebtedness” means Indebtedness and other obligations outstanding
under that certain Third Amended and Restated Credit Agreement dated as of
May 3, 2007 among Boise Cascade Holdings, L.L.C., Boise Cascade, L.L.C., the
lenders and agents party thereto and JPMorgan Chase Bank, N.A., as
administrative agent, as amended prior to the Closing Date.

 

“Facility” means any real property (including all buildings, fixtures or other
improvements located thereon) now, hereafter or heretofore owned, leased,
operated or used by Holdings or any of its Subsidiaries or any of their
respective predecessors or Affiliates.

 

“Fair Share Contribution Amount” as defined in Section 7.2.

 

“Fair Share” as defined in Section 7.2.

 

“Federal Funds Effective Rate” means for any day, the rate per annum (expressed
as a decimal, rounded upwards, if necessary, to the next higher 1/100 of 1%)
equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published by the Federal Reserve Bank of New York
on the Business Day next succeeding such day; provided, (i) if such day is not a
Business Day, the Federal Funds Rate for such day shall be such rate on such
transactions on the next preceding Business Day as so published on the next
succeeding Business Day, and (ii) if no such rate is so published on such next
succeeding Business Day, the Federal Funds Rate for such day shall be the
average rate charged to Administrative Agent, in its  capacity as a Lender, on
such day on such transactions as determined by Administrative Agent.

 

“Fee Letter” means the Amended and Restated Fee Letter dated November 2, 2007
among Aldabra, GSCP, Lehman Brothers and LCPI.

 

“Financial Officer Certification” means, with respect to the financial
statements for which such certification is required, the certification of the
chief financial officer, treasurer, assistant treasurer, principal accounting
officer or controller of Holdings that such financial

 

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statements fairly present, in all material respects, the financial condition of
Holdings and its Subsidiaries as at the dates indicated and the results of their
operations and their cash flows for the periods indicated, subject to the
absence of footnotes (in the case of quarterly financial statements) and changes
resulting from audit and normal year-end adjustments.

 

“Financial Plan” as defined in Section 5.1(i).

 

“First Lien Collateral Agent” means the collateral agent under the First Lien
Credit Agreement.

 

“First Lien Credit Agreement” means the Credit and Guaranty Agreement dated as
of the date hereof among Borrower, Holdings, the other Guarantors party thereto,
the lenders party thereto, GSCP, as administrative agent, collateral agent and
syndication agent, and the other agents party thereto, as it may be amended,
restated, supplemented, modified, replaced or Refinanced from time to time.

 

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

 

“Fiscal Year” means the fiscal year of Holdings and its Subsidiaries ending on
December 31 of each calendar year.

 

“Flood Hazard Property” means any Real Estate Asset subject to a mortgage in
favor of Collateral Agent, for the benefit of the Secured Parties, and located
in an area designated by the Federal Emergency Management Agency as having
special flood or mud slide hazards.

 

“Foreign Subsidiary” means any Subsidiary that is not a Domestic Subsidiary.

 

“Funding Guarantors” as defined in Section 7.2.

 

“Funding Notice” means a notice substantially in the form of Exhibit A-1.

 

“GAAP” means, subject to the limitations on the application thereof set forth in
Section 1.2, United States generally accepted accounting principles in effect as
of the date of determination thereof.

 

“Governmental Acts” means any act or omission, whether rightful or wrongful, of
any present or future de jure or de facto government or Governmental Authority.

 

“Governmental Authority” means any federal, state, municipal, national or other
government, governmental department, commission, board, bureau, court, agency or
instrumentality or political subdivision thereof or any entity, officer or
examiner exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to any government or any court, in
each case whether associated with a state of the United States, the United
States, or a foreign entity or government.

 

“Governmental Authorization” means any permit, license, authorization, plan,
directive, consent order or consent decree of or from any Governmental
Authority.

 

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“Grantor” as defined in the Pledge and Security Agreement.

 

“GSCP” as defined in the preamble hereto.

 

“Guaranteed Obligations” as defined in Section 7.1.

 

“Guarantor” means each of Holdings, each Domestic Subsidiary of Borrower and, to
the extent (x) no material adverse tax consequences to Holdings or Borrower
would result therefrom and (y) reasonably requested by the Administrative Agent
(with a corresponding request by the administrative agent under the First Lien
Credit Agreement), each Foreign Subsidiary of Borrower.

 

“Guarantor Subsidiary” means each Guarantor other than Holdings.

 

“Guaranty” means the guaranty of each Guarantor set forth in Section 7.

 

“Hazardous Materials” means any chemical, material or substance, exposure to
which is prohibited, limited or regulated by any Governmental Authority or which
may or could pose a hazard to the health and safety of the owners, occupants or
any Persons in the vicinity of any Facility or to the environment.

 

“Hazardous Materials Activity” means any past, current, proposed or threatened
activity, event or occurrence involving any Hazardous Materials, including the
use, manufacture, possession, storage, holding, presence, existence, location,
Release, threatened Release, discharge, placement, generation, transportation,
processing, construction, treatment, abatement, removal, remediation, disposal,
disposition or handling of any Hazardous Materials, and any corrective action or
response action with respect to any of the foregoing.

 

“Hedge Agreement” has the meaning assigned to that term in the First Lien Credit
Agreement.

 

“Highest Lawful Rate” means the maximum lawful interest rate, if any, that at
any time or from time to time may be contracted for, charged, or received under
the laws applicable to any Lender which are presently in effect or, to the
extent allowed by law, under such applicable laws which may hereafter be in
effect and which allow a higher maximum nonusurious interest rate than
applicable laws now allow.

 

“Historical Financial Statements” means as of the Closing Date, (i) the audited
financial statements of the Acquired Business, for the fiscal years ended
December 31, 2005 and December 31, 2006, consisting of balance sheets and the
related consolidated statements of income, stockholders’ equity and cash flows
for such fiscal years, (ii) the unaudited financial statements of the Acquired
Business for each fiscal quarter of the Acquired Business ended after
December 31, 2006 and at least 45 days prior to the Closing Date (other than
with respect to the fiscal quarter ended December 31, 2007), consisting of a
balance sheet and the related consolidated statements of income, stockholders’
equity and cash flows for the three-, six-or nine-month period, as applicable,
ending on the last day of the applicable fiscal quarter, and (iii) the unaudited
income statements and balance sheets of Boise White Paper, L.L.C. and its
Subsidiaries and Boise Packaging & Newsprint, L.L.C. for each fiscal month,
together with a

 

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summary of Consolidated Adjusted EBITDA for the last twelve months (including
specified adjustments thereto), in each case ended after the date of the most
recent quarterly financial statements referred to in clause (ii) above and at
least 30 days prior to the Closing Date.

 

“Holdings” as defined in the preamble hereto.

 

“Immaterial Subsidiaries” means, at any time, Subsidiaries that, on a
consolidated basis with their respective Subsidiaries and treated as if all such
Subsidiaries and their respective Subsidiaries were combined and consolidated as
a single Subsidiary, (a) had consolidated assets representing less than 2% of
the consolidated assets of Holdings and its Subsidiaries as of the last day of
the most recently ended Fiscal Quarter for which financial statements are
available, (b) accounted for less than 2% of the consolidated revenues of
Holdings and its Subsidiaries for the period of four consecutive Fiscal Quarters
most recently ended for which financial statements are available and
(c) accounted for less than 2% of Consolidated Adjusted EBITDA of Holdings and
its Subsidiaries for the period of four consecutive Fiscal Quarters most
recently ended for which financial statements are available.

 

“Increased-Cost Lenders” as defined in Section 2.23.

 

“Indebtedness”, as applied to any Person, means, without duplication, (i) all
indebtedness for borrowed money; (ii) that portion of obligations with respect
to Capital Leases that is properly classified as a capitalized liability on a
balance sheet in conformity with GAAP; (iii) notes payable and drafts accepted
representing extensions of credit whether or not representing obligations for
borrowed money; (iv) any obligation owed for all or any part of the deferred
purchase price of property or services (excluding any such obligations incurred
under ERISA), including any earn-out obligations incurred in connection with any
Permitted Acquisition (A) to the extent of the reserve, if any, required under
GAAP at the time of such Permitted Acquisition to be established in respect
thereof by Holdings or any of its Subsidiaries or (B) included on the balance
sheet of Holdings or any of its Subsidiaries, which purchase price is (a) due
more than six months from the date of incurrence of the obligation in respect
thereof or (b) evidenced by a note or similar written instrument (excluding
accounts payable due within one year and accrued expenses, in each case incurred
in the ordinary course of business); (v) all indebtedness secured by any Lien on
any property or asset owned or held by that Person regardless of whether the
indebtedness secured thereby shall have been assumed by that Person or is
nonrecourse to the credit of that Person; provided that if recourse for such
Indebtedness is limited to such property, the amount of Indebtedness arising
under this clause (v) shall be limited to the lesser of (a) the outstanding
principal amount thereof and (b) the fair market value of the property subject
to such Lien; (vi) the face amount of any letter of credit issued for the
account of that Person or as to which that Person is otherwise liable for
reimbursement of drawings other than (A) reimbursement obligations in respect of
letters of credit, the payment of which is either backed by a Letter of Credit
(as defined in the First Lien Credit Agreement) or cash collateralized,
(B) commercial letters of credit (other than, for the avoidance of doubt, any
Letter of Credit (as defined in the First Lien Credit Agreement)) issued in
support of accounts payable that do not otherwise constitute Indebtedness or
“timber under contract” agreements entered into in the ordinary course of
business and (C) standby letters of credit (other than, for the avoidance of
doubt, any Letter of Credit (as defined in the First Lien Credit Agreement))
issued in support of operating leases, insurance premia and other amounts that
do not constitute Indebtedness

 

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unless and until the beneficiary thereof has the right to draw on such standby
letter of credit); (vii) Disqualified Equity Interests, (viii) the direct or
indirect guaranty, endorsement (otherwise than for collection or deposit in the
ordinary course of business), co-making, discounting with recourse or sale with
recourse by such Person of Indebtedness of another; (ix) any obligation of such
Person the primary purpose or intent of which is to provide assurance to an
obligee that Indebtedness of the obligor thereof will be paid or discharged, or
any agreement relating thereto will be complied with, or the holders thereof
will be protected (in whole or in part) against loss in respect thereof; (x) any
liability of such Person for Indebtedness of another through any agreement
(contingent or otherwise) (a) to purchase, repurchase or otherwise acquire such
Indebtedness or any security therefor, or to provide funds for the payment or
discharge of such Indebtedness (whether in the form of loans, advances, stock
purchases, capital contributions or otherwise) or (b) to maintain the solvency
or any balance sheet item, level of income or financial condition of another if,
in the case of any agreement described under subclauses (a) or (b) of this
clause (x), the primary purpose or intent thereof is as described in clause
(ix) above; and (xi) all obligations of such Person in respect of any exchange
traded or over the counter derivative transaction, including any Interest Rate
Agreement and Currency Agreement, whether entered into for hedging or
speculative purposes; provided, in no event shall obligations under any Interest
Rate Agreement and any Currency Agreement be deemed “Indebtedness” for any
purpose under Section 6.7.

 

“Indemnified Liabilities” means, collectively, any and all liabilities,
obligations, losses, damages (including natural resource damages), penalties,
claims (including Environmental Claims), actions, judgments, suits, reasonable
out-of-pocket costs (including the costs of any investigation, study, sampling,
testing, abatement, cleanup, removal, remediation or other response action
necessary to remove, remediate, clean up or abate any Hazardous Materials
Activity), reasonable out-of-pocket expenses and disbursements of any kind or
nature whatsoever (including the reasonable fees and disbursements of counsel
for Indemnitees in connection with any investigative, administrative or judicial
proceeding or hearing commenced or threatened by any Person, whether or not any
such Indemnitee shall be designated as a party or a potential party thereto, and
any reasonable out-of-pocket fees or expenses incurred by Indemnitees in
enforcing this indemnity; provided that reasonable attorney’s fees shall be
limited to one primary counsel for all Indemnitees and, if reasonably required
by Administrative Agent, one local or specialist counsel for all Indemnitees in
each relevant jurisdiction, provided further that if counsel for Administrative
Agent determines in good faith that there is an actual or potential conflict of
interest that requires separate representation for the Agents, Borrower shall be
required to pay for one additional counsel for all such Agents taken as a
whole), whether direct, indirect or consequential and whether based on any
federal, state or foreign laws, statutes, rules or regulations (including
securities and commercial laws, statutes, rules or regulations and Environmental
Laws), on common law or equitable cause or on contract or otherwise, that may be
imposed on, incurred by, or asserted against any such Indemnitee, in any manner
relating to or arising out of (i) this Agreement or the other Credit Documents
or the transactions contemplated hereby or thereby (including the Lenders’
agreement to make Credit Extensions or the use or intended use of the proceeds
thereof, or any enforcement of any of the Credit Documents (including any sale
of, collection from, or other realization upon any of the Collateral or the
enforcement of the Guaranty)) or (ii) any Environmental Claim or any Hazardous
Materials Activity relating to or arising from, directly or indirectly, any past
or present activity, operation, land ownership, or practice of Holdings or any
of its Subsidiaries.

 

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“Indemnitee” as defined in Section 10.3.

 

“Intellectual Property” as defined in the Pledge and Security Agreement.

 

“Intellectual Property Security Agreements” has the meaning assigned to that
term in the Pledge and Security Agreement.

 

“Intercompany Note” means a promissory note substantially in the form of
Exhibit L evidencing Indebtedness owed among the Credit Parties and their
Subsidiaries.

 

“Intercreditor Agreement” means that certain Intercreditor Agreement to be
executed by the Collateral Agent, Borrower, and the First Lien Collateral Agent
substantially in the form of Exhibit M, as it may be amended, supplemented or
otherwise modified from time to time

 

“Interest Payment Date” means with respect to (i) any Loan that is a Base Rate
Loan, each March 31, June 30, September 30 and December 31 of each year,
commencing on the first such date to occur after the Closing Date and the final
maturity date of such Loan; and (ii) any Loan that is a Eurodollar Rate Loan,
the last day of each Interest Period applicable to such Loan; provided, in the
case of each Interest Period of longer than three months “Interest Payment Date”
shall also include each date that is three months, or an integral multiple
thereof, after the commencement of such Interest Period.

 

“Interest Period” means, in connection with a Eurodollar Rate Loan, an interest
period of one-, two-, three- or six-months (or, if available to all applicable
Lenders, nine- or twelve-months), as selected by Borrower in the applicable
Funding Notice or Conversion/Continuation Notice, (i) initially, commencing on
the Closing Date or Conversion/Continuation Date thereof, as the case may be;
and (ii) thereafter, commencing on the day on which the immediately preceding
Interest Period expires; provided, (a) if an Interest Period would otherwise
expire on a day that is not a Business Day, such Interest Period shall expire on
the next succeeding Business Day unless no further Business Day occurs in such
month, in which case such Interest Period shall expire on the immediately
preceding Business Day; (b) any Interest Period that begins on the last Business
Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period)
shall, subject to clause (c) of this definition, end on the last Business Day of
a calendar month; and (c) no Interest Period shall extend beyond the Maturity
Date.

 

“Interest Rate Agreement” means any interest rate swap agreement, interest rate
cap agreement, interest rate collar agreement, interest rate hedging agreement
or other similar agreement or arrangement, each of which is for the purpose of
hedging the interest rate exposure associated with Holdings’ and its
Subsidiaries’ operations and not for speculative purposes.

 

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

 

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

 

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“Investment” means (i) any direct or indirect purchase or other acquisition by
Holdings or any of its Subsidiaries of, or of a beneficial interest in, any of
the Securities of any other Person (other than Borrower or a Guarantor
Subsidiary); (ii) any direct or indirect redemption, retirement, purchase or
other acquisition for value, by any Subsidiary of Holdings from any Person
(other than Holdings or any Guarantor Subsidiary), of any Equity Interests of
such Person; and (iii) any direct or indirect loan, advance (other than
(w) advances to employees for moving, entertainment and travel expenses,
(x) drawing accounts, (y) prepayments of or deposits made in respect of supply
contracts and (z) similar expenses, in each case made in the ordinary course of
business) or capital contributions by Holdings or any of its Subsidiaries to any
other Person (other than Holdings, Borrower or any Guarantor Subsidiary),
including all indebtedness and accounts receivable from that other Person that
are not current assets or did not arise from sales to that other Person in the
ordinary course of business. The amount of any Investment shall be the original
cost of such Investment plus the cost of all additions thereto, without any
adjustments for increases or decreases in value, or write-ups, write-downs or
write-offs with respect to such Investment, but giving effect to any returns of
capital (whether in the form of dividends or otherwise) received by such Person
with respect thereto.

 

“Joint Venture” means a joint venture, partnership or other similar arrangement,
whether in corporate, partnership or other legal form; provided, in no event
shall any corporate Subsidiary of any Person be considered to be a Joint Venture
to which such Person is a party.

 

“Landlord Consent and Estoppel” means, with respect to any Leasehold Property
that is a Mortgaged Property, a letter, certificate or other instrument in
writing from the lessor under the related lease, pursuant to which, among other
things, the landlord consents to the granting of a Mortgage on such Leasehold
Property by the Credit Party tenant, such Landlord Consent and Estoppel to be in
form and substance acceptable to Collateral Agent in its reasonable discretion,
but in any event sufficient for Collateral Agent to obtain a Title Policy with
respect to such Mortgage.

 

“Landlord Personal Property Collateral Access Agreement” means a Landlord Waiver
and Consent Agreement substantially in the form of Exhibit K with such
amendments or modifications as may be reasonably approved by Collateral Agent.

 

“LCPI” as defined in the preamble hereto.

 

“Leasehold Property” means any leasehold interest of any Credit Party as lessee
under any lease of real property.

 

“Lehman Brothers” as defined in the preamble hereto.

 

“Lender” means each financial institution listed on the signature pages hereto
as a Lender, and any other Person that becomes a party hereto pursuant to an
Assignment Agreement.

 

“Leverage Ratio” means the ratio as of the last day of any Fiscal Quarter of
(i) Consolidated Total Debt as of such day to (ii) Consolidated Adjusted EBITDA
for the four-Fiscal Quarter period ending on such date.

 

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“Lien” means (i) any lien, mortgage, pledge, collateral assignment, security
interest, charge or encumbrance of any kind (including any agreement to give any
of the foregoing, any conditional sale or other title retention agreement, and
any lease or Exclusive IP License in the nature thereof) and any option, trust
or other preferential arrangement having the practical effect of any of the
foregoing and (ii) in the case of Securities, any purchase option, call or
similar right of a third party with respect to such Securities.

 

“Loan” means a loan made by a Lender to Borrower pursuant to Section 2.1(a).

 

“Loan Exposure” means, with respect to any Lender, as of any date of
determination, the outstanding principal amount of the Loans of such Lender;
provided, at any time prior to the making of the Loans, the Loan Exposure of any
Lender shall be equal to such Lender’s Commitment.

 

“Make-Whole Premium” means, with respect to a Loan on any date of prepayment,
the present value, as determined by Borrower and certified by the chief
financial officer, treasurer, assistant treasurer, principal accounting officer
or controller of Borrower to the Administrative Agent, of (a) all required
interest payments due on such Loan from the date of prepayment through and
including the Make-Whole Termination Date (excluding accrued interest) (assuming
that the interest rate applicable to all such interest is the swap rate at the
close of business on the third Business Day prior to the date of such prepayment
with the termination date nearest to the Make-Whole Termination Date plus 7.00%)
plus (b) the prepayment premium that would be due if such prepayment were made
on the day after the Make-Whole Termination Date, in each case discounted to the
date of prepayment on a quarterly basis (assuming a 360-day year and actual days
elapsed) at a rate equal to the sum of such swap rate plus 0.50%.

 

“Make-Whole Termination Date” means the third anniversary of the Closing Date.

 

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

 

“Material Adverse Change” means any material adverse effect upon (x) the
financial condition or operating results of the Paper Group (as defined in the
Acquisition Agreement) (and their Subsidiaries) or the Business (as defined in
the Acquisition Agreement), taken as a whole, or (y) the ability of Boise
Cascade, L.L.C. and the Acquired Business to consummate the transactions
contemplated by the Acquisition Agreement, except any adverse effect related to
or resulting from (1) general business or economic conditions affecting the
industry in which any member of the Paper Group, any of its Subsidiaries or the
Business operates, (2) national or international political or social conditions,
including the engagement by the United States in hostilities or the escalation
thereof, whether or not pursuant to the declaration of a national emergency or
war, or the occurrence or the escalation of any military or terrorist attack
upon the United States, or any of its territories, possessions, or diplomatic or
consular offices or upon any military installation, equipment or personnel of
the United States, (3) financial, banking, or securities markets (including any
disruption thereof and any decline in the price of any security or any market
index), (4) changes in GAAP or, solely as a result of changes in GAAP or SAAP
(as defined in the Acquisition Agreement), (5) changes in laws,

 

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rules, regulations, orders, or other binding directives issued by any
Governmental Entity (as defined in the Acquisition Agreement), (6) the taking of
any action contemplated by the Acquisition Agreement or the announcement of the
Acquisition Agreement or the transactions contemplated thereby, (7) any existing
event, occurrence, or circumstance with respect to which Parent or Borrower has
knowledge as of the date of the Commitment Letter (including any matter set
forth in the Seller Disclosure Letter (as defined in the Acquisition Agreement))
or (8) Parent’s and/or Borrower’s failure to consent to any of the actions
restricted by Section 3B of the Acquisition Agreement (except in the case of
each of the immediately preceding clause (1), (2), (3), (4) and (5), any such
adverse effect which has a materially disproportionate effect on the Acquired
Business and its Subsidiaries, taken as a whole, relative to the effect on other
companies operating in the same industry).

 

“Material Adverse Effect” means a material adverse effect on and/or material
adverse developments with respect to (i) the business, results of operations,
assets or financial condition of Holdings and its Subsidiaries taken as a whole;
(ii) the ability of any Credit Party to perform any of its material Obligations
under the Credit Documents; (iii) the legality, validity, binding effect or
enforceability against a Credit Party of a material Credit Document to which it
is a party; or (iv) the rights, remedies and benefits available to, or conferred
upon, any Agent and any Lender or any Secured Party under any material Credit
Document.

 

“Material Contract” means any contract or other arrangement to which Holdings or
any of its Subsidiaries is a party (other than the Credit Documents, the Credit
Documents (as defined in the First Lien Credit Agreement) and the Acquisition
Agreement) for which breach, nonperformance, cancellation or failure to renew
could reasonably be expected to have a Material Adverse Effect.

 

“Material Real Estate Asset’’ means (i) any fee-owned Real Estate Asset having a
fair market value in excess of $2,000,000 as of the date of the acquisition
thereof and (ii) all Leasehold Properties other than (x) the corporate
headquarters of the Acquired Business and (y) those with respect to which the
aggregate payments under the term of the lease are less than $2,000,000 per
annum.

 

“Material Subsidiary” means any Subsidiary that is not an Immaterial Subsidiary.

 

“Maturity Date” means the earlier of (i) the seventh anniversary of the Closing
Date, and (ii) the date that all Loans shall become due and payable in full
hereunder, whether by acceleration or otherwise.

 

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

 

“Mortgage” means a Mortgage substantially in the form of Exhibit J, as it may be
amended, supplemented or otherwise modified from time to time.

 

“Multiemployer Plan” means any Employee Benefit Plan which is a “multiemployer
plan” as defined in Section 3(37) of ERISA.

 

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“NAIC” means The National Association of Insurance Commissioners, and any
successor thereto.

 

“Narrative Report” means, with respect to the financial statements for which
such narrative report is required, a narrative report describing the operations
of Holdings and its Subsidiaries in the form prepared for presentation to senior
management thereof for the applicable month, Fiscal Quarter or Fiscal Year and
for the period from the beginning of the then current Fiscal Year to the end of
such period to which such financial statements relate.

 

“Net Asset Sale Proceeds” means, with respect to any Asset Sale, an amount equal
to:  (i) Cash payments (including any Cash received by way of deferred payment
pursuant to, or by monetization of, a note receivable or otherwise, but only as
and when so received) received by Holdings or any of its Subsidiaries from such
Asset Sale, minus (ii) any bona fide direct costs incurred in connection with
such Asset Sale, including (a) all bona fide fees and expenses paid by any of
Holdings or its Subsidiaries to third parties in connection with such Asset
Sale, (b) income or gains taxes payable by the seller as a result of any gain
recognized in connection with such Asset Sale, (c) payment of the outstanding
principal amount of, premium or penalty, if any, and interest on any
Indebtedness (other than the Loans) that is secured by a Lien on the stock or
assets in question and that is required to be repaid under the terms thereof as
a result of such Asset Sale and (d) a reasonable reserve for any indemnification
payments (fixed or contingent) attributable to seller’s indemnities and
representations and warranties to purchaser in respect of such Asset Sale
undertaken by Holdings or any of its Subsidiaries in connection with such Asset
Sale.

 

“Net Insurance/Condemnation Proceeds” means an amount equal to:  (i) any Cash
payments or proceeds received by Holdings or any of its Subsidiaries (a) under
any casualty insurance policy in respect of a covered loss thereunder or (b) as
a result of the taking of any assets of Holdings or any of its Subsidiaries by
any Person pursuant to the power of eminent domain, condemnation or otherwise,
or pursuant to a sale of any such assets to a purchaser with such power under
threat of such a taking, minus (ii) (a) any actual and reasonable costs incurred
by Holdings or any of its Subsidiaries in connection with the adjustment or
settlement of any claims of Holdings or such Subsidiary in respect thereof, and
(b) any bona fide direct costs incurred in connection with any sale of such
assets as referred to in clause (i)(b) of this definition, including income
taxes payable as a result of any gain recognized in connection therewith and
payment of the outstanding principal amount of, premium or penalty, if any, and
interest on any Indebtedness (other than the Loans) that is secured by a Lien on
the assets in question and that is required to be repaid under the terms thereof
as a result of such casualty or condemnation or such sale in lieu thereof.

 

“Non-Consenting Lender” as defined in Section 2.23.

 

“Nonpublic Information” means information which has not been disseminated in a
manner making it available to investors generally, within the meaning of
Regulation FD.

 

“Non-US Lender” as defined in Section 2.20(e).

 

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“Note” means a promissory note substantially in the form of Exhibit B, as it may
be amended, supplemented or otherwise modified from time to time.

 

“Notice” means a Funding Notice or a Conversion/ Continuation Notice.

 

“Obligations” means all obligations of every nature of each Credit Party,
including obligations from time to time owed to the Agents (including former
Agents), the Lenders or any of them, under any Credit Document, whether for
principal, interest (including interest which, but for the filing of a petition
in bankruptcy with respect to such Credit Party, would have accrued on any
Obligation, whether or not a claim is allowed against such Credit Party for such
interest in the related bankruptcy proceeding), fees, expenses, indemnification
or otherwise.

 

“Obligee Guarantor” as defined in Section 7.7.

 

“Organizational Documents” means (i) with respect to any corporation, its
certificate or articles of incorporation or organization, as amended, and its
by-laws, as amended, (ii) with respect to any limited partnership, its
certificate of limited partnership, as amended, and its partnership agreement,
as amended, (iii) with respect to any general partnership, its partnership
agreement, as amended, and (iv) with respect to any limited liability company,
its articles of organization, as amended, and its operating agreement, as
amended.  In the event any term or condition of this Agreement or any other
Credit Document requires any Organizational Document to be certified by a
secretary of state or similar governmental official, the reference to any such
“Organizational Document” shall only be to a document of a type customarily
certified by such governmental official.

 

“Other Taxes” means 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 Credit Document.

 

“Parent” means Boise Inc., a Delaware corporation (formerly known as Aldabra 2
Acquisition Corp.).

 

“Patriot Act” as defined in Section 3.1(r).

 

“PBGC” means the Pension Benefit Guaranty Corporation or any successor thereto.

 

“Pension Plan” means any Employee Benefit Plan, other than a Multiemployer Plan,
which is subject to Section 412 of the Internal Revenue Code or Section 302 of
ERISA.

 

“Permitted Acquisition” means any acquisition by Borrower or any of its
wholly-owned Subsidiaries, whether by purchase, merger or otherwise, of all or
substantially all of the assets of, all of the Equity Interests of, or a
business line or unit or a division or a manufacturing facility or a
distribution facility of, any Person; provided,

 

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

 

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

 

(iii)          in the case of the acquisition of Equity Interests, all of the
Equity Interests (except for any such Securities in the nature of directors’
qualifying shares required pursuant to applicable law) acquired or otherwise
issued by such Person or any newly formed Subsidiary of Borrower in connection
with such acquisition shall be owned 100% by Borrower or a Guarantor Subsidiary
thereof, and Borrower shall have taken, or caused to be taken, as of the date
such Person becomes a Subsidiary of Borrower, each of the actions set forth in
Sections 5.10 and/or 5.11, as applicable;

 

(iv)          Holdings and its Subsidiaries shall be in compliance with the
financial covenant set forth in Section 6.7(b) on a pro forma basis after giving
effect to such acquisition as of the last day of the Fiscal Quarter most
recently ended (as determined in accordance with Section 6.7(d));

 

(v)           Borrower shall have delivered to Administrative Agent (A) at least
5 Business Days prior to such proposed acquisition, (i) a Compliance Certificate
evidencing compliance with Section 6.7 as required under clause (iv) above and
(ii) all other relevant financial information with respect to such acquired
assets, including the aggregate consideration for such acquisition and any other
information required to demonstrate compliance with Section 6.7 and (B) promptly
upon reasonable request by Administrative Agent, a copy of the purchase
agreement related to the proposed Permitted Acquisition (and any related
documents reasonably requested by Administrative Agent); and

 

(vi)          the predominant business conducted by any such Person shall comply
with the permitted businesses of Holdings and its Subsidiaries as provided in
Section 6.12.

 

“Permitted Investors” means (i) Madison Dearborn Partners, LLC, its Affiliates
but not including, however, any operating portfolio companies of any of the
foregoing and investments funds under common management with Madison Dearborn
Partners, LLC or its Affiliates, (ii) OfficeMax Incorporated and (iii) Boise
Cascade Holdings, L.L.C.

 

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

 

“Permitted Operating Asset Swap” means any transfer of Eligible Swap Assets by
Borrower or any Subsidiary in which at least 95% of the consideration received
by the transferor consists of Eligible Swap Assets (and any balance of such
consideration consists of cash); provided that (a) after giving effect to such
transfer, the aggregate fair market value of all assets transferred pursuant to
Permitted Operating Asset Swaps (i) during any fiscal year of Borrower, on a
cumulative basis, shall not exceed $20,000,000 and (ii) during the term of this
Agreement, on a cumulative basis, shall not exceed $40,000,000 and (b) all
actions required to

 

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be taken pursuant to Sections 5.10 and/or 5.11, as applicable, with respect to
any Eligible Swap Assets so received as consideration shall be taken.

 

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

 

“Platform” as defined in Section 5.1(o).

 

“Pledge and Security Agreement” means the Pledge and Security Agreement to be
executed by Borrower and each Guarantor substantially in the form of Exhibit I,
as it may be amended, supplemented or otherwise modified from time to time.

 

“Post-Closing Agreement” means that certain Post-Closing Agreement dated as of
the date hereof, among the Credit Parties and the Collateral Agent, as it may be
amended, restated, supplemented or otherwise modified from time to time.

 

“Prime Rate” means the rate of interest quoted in The Wall Street Journal, Money
Rates Section as the Prime Rate (currently defined as the base rate on corporate
loans posted by at least 75% of the nation’s thirty (30) largest banks), as in
effect from time to time.  The Prime Rate is a reference rate and does not
necessarily represent the lowest or best rate actually charged to any customer. 
Any Agent or any other Lender may make commercial loans or other loans at rates
of interest at, above or below the Prime Rate.

 

“Principal Office” means Administrative Agent’s “Principal Office” as set forth
on Appendix B, or such other office or office of a third party or sub-agent, as
appropriate, as Administrative Agent may from time to time designate in writing
to Borrower and each Lender.

 

“Projections” as defined in Section 4.8.

 

“Pro Rata Share” means with respect to any Lender, the percentage obtained by
dividing (a) the Loan Exposure of that Lender by (b) the aggregate Loan Exposure
of all Lenders.

 

“Real Estate Asset” means, at any time of determination, any interest (fee,
leasehold or otherwise) then owned by any Credit Party in any real property.

 

“Record Document” means, with respect to any Leasehold Property that is a
Mortgaged Property, (i) the lease evidencing such Leasehold Property or a
memorandum thereof, executed and acknowledged by the owner of the affected real
property, as lessor, or (ii) if such Leasehold Property was acquired or
subleased from the holder of a Recorded Leasehold Interest, the applicable
assignment or sublease document, executed and acknowledged by such holder, in
each case in form sufficient to give such constructive notice upon recordation
and otherwise in form reasonably satisfactory to Collateral Agent.

 

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“Recorded Leasehold Interest” means a Leasehold Property with respect to which a
Record Document has been recorded in all places necessary or desirable, in
Collateral Agent’s reasonable judgment, to give constructive notice of such
Leasehold Property to third-party purchasers and encumbrancers of the affected
real property.

 

“Refinance” means, in respect of any Indebtedness, to refinance, extend, renew,
defease, amend, modify, supplement, restructure, replace, refund or repay, or to
issue other indebtedness, in exchange or replacement for, such Indebtedness in
whole or in part.  “Refinanced” and “Refinancing” shall have correlative
meanings.  All such terms shall include any subsequent Refinancing of any
Indebtedness issued in connection with any Refinancing.

 

“Register” as defined in Section 2.7(b).

 

“Regulation D” means Regulation D of the Board of Governors, as in effect from
time to time.

 

“Regulation FD” means Regulation FD as promulgated by the US Securities and
Exchange Commission under the Securities and Exchange Act as in effect from time
to time.

 

“Regulation S-X” means Regulation S-X as promulgated by the US Securities and
Exchange Commission under the Securities Act as in effect from time to time.

 

“Related Agreements” means, collectively, the Acquisition Agreement, the First
Lien Credit Agreement and the Credit Documents (as defined in the First Lien
Credit Agreement).

 

“Related Fund” means, with respect to any Lender that is an investment fund, any
other investment fund that invests in commercial loans and that is managed or
advised by the same investment advisor as such Lender or by an Affiliate of such
investment advisor.

 

“Release” means any release, spill, emission, leaking, pumping, pouring,
injection, escaping, deposit, disposal, discharge, dispersal, dumping, leaching
or migration of any Hazardous Material into the indoor or outdoor environment
(including the abandonment or disposal of any barrels, containers or other
closed receptacles containing any Hazardous Material), including the movement of
any Hazardous Material through the air, soil, surface water or groundwater.

 

“Replacement Lender” as defined in Section 2.23.

 

“Required Prepayment Date” as defined in Section 2.15(b).

 

“Requisite Lenders” means one or more Lenders having or holding Loan Exposure
representing more than 50% of the aggregate Loan Exposure of all Lenders.

 

“Requisite Supermajority Lenders” means one or more Lenders having or holding
Loan Exposure representing more than 662/3 % of the aggregate Loan Exposure of
all Lenders.

 

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“Restricted Junior Payment” means (i) any dividend or other distribution, direct
or indirect, on account of any shares of any class of stock of Holdings or
Borrower (or any direct or indirect parent thereof) now or hereafter
outstanding, except a dividend payable solely in shares of that class of stock
to the holders of that class; (ii) any redemption, retirement, sinking fund or
similar payment, purchase or other acquisition for value, direct or indirect, of
any shares of any class of stock of Holdings or Borrower (or any direct or
indirect parent thereof) now or hereafter outstanding; (iii) any payment made to
retire, or to obtain the surrender of, any outstanding warrants, options or
other rights to acquire shares of any class of stock of Holdings or Borrower (or
any direct or indirect parent thereof) now or hereafter outstanding;
(iv) management or similar fees payable to Parent or any of its Affiliates and
(v) any payment or prepayment of principal of, premium, if any, or interest on,
or redemption, purchase, retirement, defeasance (including in-substance or legal
defeasance), sinking fund or similar payment with respect to, any Subordinated
Indebtedness.

 

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

 

“Second Priority” means, with respect to any Lien purported to be created in any
Collateral pursuant to any Collateral Document, that such Lien is (i) the only
Lien to which such Collateral is subject, other than any Permitted Lien and
(ii) junior in priority to the Liens created under or relating to the Credit
Documents (as defined in the First Lien Credit Agreement) in accordance with the
Intercreditor Agreement.

 

“Secured Parties” has the meaning assigned to that term in the Pledge and
Security Agreement.

 

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

 

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

 

“Solvency Certificate” means a Solvency Certificate of the chief financial
officer of Holdings substantially in the form of Exhibit G-2.

 

“Solvent” means, with respect to any Credit Party, that as of the date of
determination, both (i) (a) the sum of such Credit Party’s debt (including
contingent liabilities) does not exceed the present fair saleable value of such
Credit Party’s present assets; (b) such Credit Party’s capital is not
unreasonably small in relation to its business as contemplated on the Closing
Date and reflected in the Projections or with respect to any transaction
contemplated or undertaken after the Closing Date; and (c) such Person has not
incurred and does not intend to incur, or believe (nor should it reasonably
believe) that it will incur, debts beyond its ability to

 

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pay such debts as they become due (whether at maturity or otherwise); and
(ii) such Person is “solvent” within the meaning given that term and similar
terms under the Bankruptcy Code and applicable laws relating to fraudulent
transfers and conveyances.  For purposes of this definition, the amount of any
contingent liability at any time shall be computed as the amount that, in light
of all of the facts and circumstances existing at such time, represents the
amount that can reasonably be expected to become an actual or matured liability
(irrespective of whether such contingent liabilities meet the criteria for
accrual under Statement of Financial Accounting Standard No. 5).

 

“Specified Investment” means any investment by Borrower or any Subsidiary to the
extent financed with net cash proceeds received from the issuance of Equity
Interests by, or capital contributions made to, Holdings after the Closing Date,
provided that (i) Administrative Agent receives written notice describing such
investment concurrently with or promptly following the issuance of such Equity
Interests and (ii) such investment is made within 90 days of receipt by Holdings
of such net cash proceeds.

 

“Subject Transaction” as defined in Section 6.7(d).

 

“Subordinated Indebtedness” means Indebtedness permitted under
Section 6.1(m) and Section 6.1(n).

 

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

 

“Supply Agreement” means the Paper Purchase Agreement dated October 29, 2004,
between Boise White Paper, L.L.C. and OfficeMax Incorporated, amending and
superseding the Paper Purchase Agreement Term Sheet dated April 28, 2004 between
OfficeMax Incorporated and Boise Office Solutions.

 

“Syndication Agent” as defined in the preamble hereto.

 

“Tax” means any present or future tax, levy, impost, duty, assessment, charge,
fee, deduction or withholding of any nature and whatever called, by whomsoever,
on whomsoever and wherever imposed, levied, collected, withheld or assessed;
provided, “Tax on the overall net income” of a Person shall be construed as a
reference to a tax imposed by the United States of America or by the
jurisdiction in which that Person is organized or in which that Person’s
applicable principal office (and/or, in the case of a Lender, its lending
office) is located or in which that Person (and/or, in the case of a Lender, its
lending office) is deemed to be doing business on all or part of the net income,
profits or gains (whether worldwide, or only insofar as

 

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such income, profits or gains are considered to arise in or to relate to a
particular jurisdiction, or otherwise) of that Person (and/or, in the case of a
Lender, its applicable lending office), including any branch profits taxes
imposed by the United States of America or any similar tax imposed by any other
jurisdiction described above.

 

“Terminated Lender” as defined in Section 2.23.

 

“Title Policy” as defined in Section 3.1(h).

 

“Transaction Costs” means the fees, costs and expenses payable by Holdings,
Borrower or any of Borrower’s Subsidiaries on or before the Closing Date in
connection with the transactions contemplated by the Credit Documents and the
Related Agreements.

 

“Treasury Regulations” means the income tax regulations promulgated by the
Internal Revenue Service, Department of Treasury, pursuant to the Internal
Revenue Code.

 

“Treasury Services Agreements” shall mean any agreement relating to treasury,
depositary and cash management services or automated clearinghouse transfer of
funds.

 

“Type of Loan” means a Base Rate Loan or a Eurodollar Rate Loan.

 

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

 

“Unadjusted Eurodollar Rate Component” means that component of the interest
costs to Borrower in respect of a Eurodollar Rate Loan that is based upon the
rate obtained pursuant to clause (i) of the definition of Adjusted Eurodollar
Rate.

 

“U.S. Lender” as defined in Section 2.20(e).

 

“Waivable Mandatory Prepayment” as defined in Section 2.15(b).

 

1.2.   Accounting Terms.  Except as otherwise expressly provided herein, all
accounting terms not otherwise defined herein shall have the meanings assigned
to them in conformity with GAAP.  Except as set forth below, financial
statements and other information required to be delivered by Holdings to Lenders
pursuant to Section 5.1(b) and 5.1(c) shall be prepared in accordance with GAAP
as in effect at the time of such preparation.  If at any time any change in GAAP
would affect the computation of any financial ratio or requirement set forth in
any Credit Document, and either Borrower or Requisite Lenders shall so request,
Administrative Agent, the Lenders and Borrower shall negotiate in good faith to
amend such ratio or requirement to preserve the original intent thereof in light
of such change in GAAP (subject to the approval of the Requisite Lenders);
provided that, until so amended, (i) such ratio or requirement shall continue to
be computed in accordance with GAAP prior to such change therein and
(ii) Borrower shall provide to Administrative Agent and the Lenders as
reasonably requested hereunder a reconciliation between calculations of such
ratio or requirement made before and after giving effect to such change in GAAP.

 

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1.3.   Interpretation, etc.  Any of the terms defined herein may, unless the
context otherwise requires, be used in the singular or the plural, depending on
the reference.  References herein to any Section, Appendix, Schedule or
Exhibit shall be to a Section, an Appendix, a Schedule or an Exhibit, as the
case may be, hereof unless otherwise specifically provided.  The use herein of
the word “include” or “including”, when following any general statement, term or
matter, shall not be construed to limit such statement, term or matter to the
specific items or matters set forth immediately following such word or to
similar items or matters, whether or not non-limiting language (such as “without
limitation” or “but not limited to” or words of similar import) is used with
reference thereto, but rather shall be deemed to refer to all other items or
matters that fall within the broadest possible scope of such general statement,
term or matter.  The terms lease and license shall include sub-lease and
sub-license, as applicable.

 

1.4.   Intercreditor Agreement.  All rights and obligations of the Agents and
Lenders under this Agreement shall be subject to the Intercreditor Agreement. 
Notwithstanding anything herein to the contrary, the Liens and security
interests granted to the Agents or Lenders pursuant to this Agreement or any
other Credit Document and the exercise of any right or remedy by the Agents or
Lenders hereunder are subject to the provisions of the Intercreditor Agreement. 
In the event of any conflict between the terms of the Intercreditor Agreement
and this Agreement, such conflict shall be resolved in accordance with
Section 8.1 of the Intercreditor Agreement.  Any reference in this Agreement to
“second priority lien” or words of similar effect in describing the security
interests created hereunder or under any Credit Document shall be understood to
refer to such priority as set forth in the Intercreditor Agreement.  All
representations, warranties and covenants in this Agreement shall be subject to
the provisions and qualifications set forth in this Section 1.4.

 

SECTION 2.   LOANS

 

2.1.   Loans.

 

(a)   Commitments.  Subject to the terms and conditions hereof, each Lender
severally agrees to make, on the Closing Date,  a Loan to Borrower in an amount
equal to such Lender’s Commitment.  Borrower may make only one borrowing under
the Commitments which shall be on the Closing Date.  Any amount borrowed under
this Section 2.1(a) and subsequently repaid or prepaid may not be reborrowed. 
Subject to Sections 2.13(a) and 2.14, all amounts owed hereunder shall be paid
in full no later than the Maturity Date.  Each Lender’s Commitment shall
terminate immediately and without further action on the Closing Date after
giving effect to the funding of such Lender’s Commitment on such date.

 

(b)   Borrowing Mechanics for Loans.

 

(i)   Borrower shall deliver to Administrative Agent by telefacsimile,
electronic communication (in pdf format) or hand delivery a fully executed
Funding Notice no later than one Business Day prior to the Closing Date. 
Promptly upon receipt by Administrative Agent of such Funding Notice,
Administrative Agent shall notify each Lender of the proposed borrowing.

 

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(ii)   Each Lender shall make its Loan available to Administrative Agent not
later than 12:00 p.m. (New York City time) on the Closing Date, by wire transfer
of same day funds in Dollars, at the Principal Office designated by
Administrative Agent.  Upon satisfaction or waiver of the conditions precedent
specified herein, Administrative Agent shall make the proceeds of the Loans
available to Borrower on the Closing Date by causing an amount of same day funds
in Dollars equal to the proceeds of all such Loans received by Administrative
Agent from Lenders to be credited to an account designated in writing to
Administrative Agent by Borrower.

 

2.2.   Intentionally Omitted.

 

2.3.   Intentionally Omitted.

 

2.4.   Intentionally Omitted.

 

2.5.   Pro Rata Shares; Availability of Funds.

 

(a)   Pro Rata Shares.  All Loans shall be made, and all participations
purchased, by Lenders simultaneously and proportionately to their respective Pro
Rata Shares, it being understood that no Lender shall be responsible for any
default by any other Lender in such other Lender’s obligation to make a Loan
requested hereunder or purchase a participation required hereby nor shall any
Commitment of any Lender be increased or decreased as a result of a default by
any other Lender in such other Lender’s obligation to make a Loan requested
hereunder or purchase a participation required hereby.

 

(b)   Availability of Funds.  Unless Administrative Agent shall have been
notified by any Lender prior to the Closing Date that such Lender does not
intend to make available to Administrative Agent the amount of such Lender’s
Loan requested on the Closing Date, Administrative Agent may assume that such
Lender has made such amount available to Administrative Agent on the Closing
Date and Administrative Agent may, in its sole discretion, but shall not be
obligated to, make available to Borrower a corresponding amount on the Closing
Date.  If such corresponding amount is not in fact made available to
Administrative Agent by such Lender, Administrative Agent shall be entitled to
recover such corresponding amount on demand from such Lender together with
interest thereon, for each day from the Closing Date until the date such amount
is paid to Administrative Agent, at the customary rate set by Administrative
Agent for the correction of errors among banks for three Business Days and
thereafter at the Base Rate.  If such Lender does not pay such corresponding
amount forthwith upon Administrative Agent’s demand therefor, Administrative
Agent shall promptly notify Borrower and Borrower shall immediately pay such
corresponding amount to Administrative Agent together with interest thereon, for
each day from the Closing Date until the date such amount is paid to
Administrative Agent, at the rate payable hereunder for Base Rate Loans. 
Nothing in this Section 2.5(b) shall be deemed to relieve any Lender from its
obligation to fulfill its Commitment hereunder or to prejudice any rights that
Borrower may have against any Lender as a result of any default by such Lender
hereunder.

 

2.6.   Use of Proceeds.  The proceeds of the Loans, together with the proceeds
of the loans to be made under the First Lien Credit Agreement on the Closing
Date, shall be applied by

 

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Borrower to fund (a) in part, the Acquisition pursuant to the Acquisition
Agreement, including the refinancing or retiring of certain existing
Indebtedness for borrowed money of the Acquired Business and (b) the payment of
fees, commissions and expenses in connection therewith and in connection with
the financing of the foregoing, including fees under Section 2.11(a).  No
portion of the proceeds of any Credit Extension shall be used in any manner that
causes or might cause such Credit Extension or the application of such proceeds
to violate Regulation T, Regulation U or Regulation X of the Board of Governors
or any other regulation thereof or to violate the Exchange Act.

 

2.7.   Evidence of Debt; Register; Lenders’ Books and Records; Notes.

 

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

 

(b)   Register.  Administrative Agent (or its agent or sub-agent appointed by
it) shall maintain at the Principal Office a register for the recordation of the
names and addresses of Lenders and the Loans of each Lender from time to time
(the “Register”).  The Register shall be available for inspection by Borrower or
any Lender (with respect to any entry relating to such Lender’s Loans) at any
reasonable time and from time to time upon reasonable prior notice. 
Administrative Agent shall record, or shall cause to be recorded, in the
Register the Loans in accordance with the provisions of Section 10.6, and each
repayment or prepayment in respect of the principal amount of the Loans, and any
such recordation shall be conclusive and binding on Borrower and each Lender,
absent manifest error; provided, failure to make any such recordation, or any
error in such recordation, shall not affect Borrower’s Obligations in respect of
any Loan.  Borrower hereby designates LCPI to serve as Borrower’s agent solely
for purposes of maintaining the Register as provided in this Section 2.7, and
Borrower hereby agrees that, to the extent LCPI serves in such capacity, LCPI
and its officers, directors, employees, agents, sub-agents and affiliates shall
constitute “Indemnitees.”

 

(c)   Notes.  If so requested by any Lender by written notice to Borrower (with
a copy to Administrative Agent) at least two Business Days prior to the Closing
Date, or at any time thereafter, Borrower shall execute and deliver to such
Lender (and/or, if applicable and if so specified in such notice, to any Person
who is an assignee of such Lender pursuant to Section 10.6) on the Closing Date
(or, if such notice is delivered after the Closing Date, promptly after
Borrower’s receipt of such notice) a Note to evidence such Lender’s Loan.

 

2.8.   Interest on Loans.

 

(a)   Except as otherwise set forth herein, each Loan shall bear interest on the
unpaid principal amount thereof from the date made through repayment (whether by
acceleration or otherwise) thereof as follows:

 

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(i)   if a Base Rate Loan, at the Base Rate plus 6.00% per annum; or

 

(ii)   if a Eurodollar Rate Loan, at the Adjusted Eurodollar Rate plus 7.00% per
annum.

 

(b)   The basis for determining the rate of interest with respect to any Loan,
and the Interest Period with respect to any Eurodollar Rate Loan, shall be
selected by Borrower and notified to Administrative Agent and Lenders pursuant
to the applicable Funding Notice or Conversion/Continuation Notice, as the case
may be; provided, until the earlier of (i) the date that GSCP notifies Borrower
that the primary syndication of the Loans has been completed, in accordance with
the terms of the Fee Letter, and (ii) 90 days after the Closing Date, the Loans
shall be maintained as either (1) Eurodollar Rate Loans having an Interest
Period of no longer than one month or (2) Base Rate Loans.  If on any day a Loan
is outstanding with respect to which a Funding Notice or Conversion/Continuation
Notice has not been delivered to Administrative Agent in accordance with the
terms hereof specifying the applicable basis for determining the rate of
interest, then for that day such Loan shall be a Base Rate Loan.

 

(c)   In connection with Eurodollar Rate Loans there shall be no more than
twelve (12) Interest Periods outstanding at any time.  In the event Borrower
fails to specify between a Base Rate Loan or a Eurodollar Rate Loan in the
applicable Funding Notice or Conversion/Continuation Notice, such Loan (if
outstanding as a Eurodollar Rate Loan) will be automatically converted into a
Base Rate Loan on the last day of the then-current Interest Period for such Loan
(or if outstanding as a Base Rate Loan will remain as, or (if not then
outstanding) will be made as, a Base Rate Loan).  In the event Borrower fails to
specify an Interest Period for any Eurodollar Rate Loan in the applicable
Funding Notice or Conversion/Continuation Notice, Borrower shall be deemed to
have selected an Interest Period of one month.  As soon as practicable after
10:00 a.m. (New York City time) on each Interest Rate Determination Date,
Administrative Agent shall determine (which determination shall, absent manifest
error, be final, conclusive and binding upon all parties) the interest rate that
shall apply to the Eurodollar Rate Loans for which an interest rate is then
being determined for the applicable Interest Period and shall promptly give
notice thereof (in writing or by telephone confirmed in writing) to Borrower and
each Lender.

 

(d)   Interest payable pursuant to Section 2.8(a) shall be computed (i) in the
case of Base Rate Loans on the basis of a 365-day or 366-day year, as the case
may be, and (ii) in the case of Eurodollar Rate Loans, on the basis of a 360-day
year, in each case for the actual number of days elapsed in the period during
which it accrues.  In computing interest on any Loan, the date of the making of
such Loan or the first day of an Interest Period applicable to such Loan or the
last Interest Payment Date with respect to such Loan or, with respect to a Base
Rate Loan being converted from a Eurodollar Rate Loan, the date of conversion of
such Eurodollar Rate Loan to such Base Rate Loan, as the case may be, shall be
included, and the date of payment of such Loan or the expiration date of an
Interest Period applicable to such Loan or, with respect to a Base Rate Loan
being converted to a Eurodollar Rate Loan, the date of conversion of such Base
Rate Loan to such Eurodollar Rate Loan, as the case may be, shall be excluded;
provided, if a Loan is repaid on the same day on which it is made, one day’s
interest shall be paid on that Loan.

 

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(e)   Except as otherwise set forth herein, interest on each Loan (i) shall
accrue on a daily basis and shall be payable in arrears on each Interest Payment
Date with respect to interest accrued on and to each such payment date;
(ii) shall accrue on a daily basis and shall be payable in arrears upon any
prepayment of that Loan, whether voluntary or mandatory, to the extent accrued
on the amount being prepaid; and (iii) shall accrue on a daily basis and shall
be payable in arrears at maturity of the Loans, including final maturity of the
Loans; provided, however, with respect to any voluntary prepayment of a Base
Rate Loan, accrued interest shall instead be payable on the applicable Interest
Payment Date.

 

2.9.   Conversion/Continuation.

 

(a)   Subject to Section 2.18 and so long as no Default or Event of Default
shall have occurred and then be continuing, Borrower shall have the option:

 

(i)   to convert at any time all or any part of any Loan equal to $5,000,000 and
integral multiples of $1,000,000 in excess of that amount from one Type of Loan
to another Type of Loan; provided, a Eurodollar Rate Loan may only be converted
on the expiration of the Interest Period applicable to such Eurodollar Rate Loan
unless Borrower shall pay all amounts due under Section 2.18 in connection with
any such conversion; or

 

(ii)   upon the expiration of any Interest Period applicable to any Eurodollar
Rate Loan, to continue all or any portion of such Loan equal to $5,000,000 and
integral multiples of $1,000,000 in excess of that amount as a Eurodollar Rate
Loan.

 

(b)   Borrower shall deliver by telefacsimile, electronic communication (in pdf
format) or hand delivery a fully executed Conversion/Continuation Notice to
Administrative Agent no later than (i) 2:00 p.m. (New York City time) at least
one Business Day in advance of the proposed conversion date (in the case of a
conversion to a Base Rate Loan) and (ii) 12:00 p.m. (New York City time) at
least three Business Days in advance of the proposed conversion/continuation
date (in the case of a conversion to, or a continuation of, a Eurodollar Rate
Loan).  Except as otherwise provided herein, a Conversion/Continuation Notice
for conversion to, or continuation of, any Eurodollar Rate Loans (or telephonic
notice in lieu thereof) shall be irrevocable on and after the related Interest
Rate Determination Date, and Borrower shall be bound to effect a conversion or
continuation in accordance therewith.

 

2.10.   Default Interest.  Upon the occurrence and during the continuance of an
Event of Default under Section 8.1(a), the overdue principal amount of all Loans
outstanding and, to the extent permitted by applicable law, any overdue interest
payments on the Loans or any overdue fees or other overdue amounts owed
hereunder, shall thereafter bear interest (including post-petition interest in
any proceeding under the Bankruptcy Code or other applicable bankruptcy laws)
payable on demand at a rate that is 2% per annum in excess of the interest rate
otherwise payable hereunder with respect to the applicable Loans (or, in the
case of any such overdue fees and other overdue amounts, at a rate which is 2%
per annum in excess of the interest rate otherwise payable hereunder for Base
Rate Loans); provided, in the case of Eurodollar Rate Loans, upon the expiration
of the Interest Period in effect at the time any such increase in interest rate
is effective such Eurodollar Rate Loans shall thereupon become Base Rate Loans
and shall thereafter bear interest payable upon demand at a rate which is 2% per

 

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annum in excess of the interest rate otherwise payable hereunder for Base Rate
Loans.  Payment or acceptance of the increased rates of interest provided for in
this Section 2.10 is not a permitted alternative to timely payment and shall not
constitute a waiver of any Event of Default or otherwise prejudice or limit any
rights or remedies of Administrative Agent or any Lender.

 

2.11.   Fees.

 

(a)   Borrower agrees to pay on the Closing Date to each Lender who is a party
to this Agreement as a Lender on the Closing Date, as fee compensation for the
funding of such Lender’s Loan as part of the initial funding to be made on the
Closing Date, a closing fee in an amount equal to 10.00% of the stated principal
amount of such Lender’s Loan, payable to such Lender from, at Borrower’s option,
the proceeds of its Loans as and when funded on the Closing Date and/or the
proceeds of loans under the First Lien Credit Agreement made on the Closing
Date.  Such closing fee will be in all respects fully earned, due and payable on
the Closing Date and non-refundable and non-creditable thereafter.

 

(b)   In addition to the foregoing fees, Borrower agrees to pay to Agents such
other fees in the amounts and at the times separately agreed upon.

 

2.12.   Payment at Maturity.  The Loans, together with all other amounts owed
hereunder with respect thereto, shall be paid in full no later than the Maturity
Date.

 

2.13.   Voluntary Prepayments; Make-Whole Premium; Call Premium.

 

(a)   Voluntary Prepayments.

 

(i)   Subject to paragraphs (b) and (c) below, at any time and from time to time
after the Discharge of First Lien Obligations:

 

(1)           with respect to Base Rate Loans, Borrower may prepay any such
Loans on any Business Day in whole or in part, in an aggregate minimum amount of
$1,000,000 and integral multiples of $500,000 in excess of that amount; and

 

(2)           with respect to Eurodollar Rate Loans, Borrower may prepay any
such Loans on any Business Day in whole or in part in an aggregate minimum
amount of $5,000,000 and integral multiples of $1,000,000 in excess of that
amount.

 

(ii)   All such prepayments shall be made:

 

(1)           upon not less than one Business Day’s prior written or telephonic
notice in the case of Base Rate Loans; and

 

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(2)           upon not less than three Business Days’ prior written or
telephonic notice in the case of Eurodollar Rate Loans;

 

in each case given to Administrative Agent by 12:00 p.m. (New York City time) on
the date required and, if given by telephone, promptly confirmed in writing to
Administrative Agent (and Administrative Agent will promptly transmit such
telephonic or original notice for Loans by telefacsimile or telephone to each
Lender).  Upon the giving of any such notice, the principal amount of the Loans
specified in such notice and any additional amounts required pursuant to clause
(b) or (c) below shall become due and payable on the prepayment date specified
therein.  Any such voluntary prepayment shall be applied as specified in
Section 2.15(a).

 

(b)   Make-Whole Premium.  In the event that the Loans are prepaid as a result
of a voluntary or mandatory prepayment (other than as a result of a prepayment
under Section 2.14(b) or (d)) at any time prior to the third anniversary of the
Closing Date, Borrower shall pay Lenders a prepayment premium equal to the
Make-Whole Premium.

 

(c)   Call Premium.  In the event all or any portion of the Loans are repaid
pursuant to Section 2.13(a), 2.14(a) or 2.14(c) on or after the third
anniversary of the Closing Date and prior to the sixth anniversary of the
Closing Date, such repayments will be made at (i) 105.0% of the amount repaid if
such repayment occurs on or after the third anniversary of the Closing Date and
prior to the fourth anniversary of the Closing Date, (ii) 103.0% of the amount
repaid if such repayment occurs on or after the fourth anniversary of the
Closing Date and prior to the fifth anniversary of the Closing Date, and
(iii) 101.0% of the amount repaid if such repayment occurs on or after the fifth
anniversary of the Closing Date and prior to the sixth anniversary of the
Closing Date.

 

2.14.   Mandatory Prepayments.

 

(a)   Asset Sales.  Subject to Section 2.15(b), no later than three (3) Business
Days following the date of receipt by Holdings or any of its Subsidiaries of any
Net Asset Sale Proceeds, Borrower shall prepay the Loans as set forth in
Section 2.15 in an aggregate amount equal to such Net Asset Sale Proceeds;
provided, so long as no Default or Event of Default shall have occurred and be
continuing, Borrower shall have the option, directly or through one or more of
its Subsidiaries, to invest Net Asset Sale Proceeds within one year of receipt
thereof in Real Estate Assets, equipment or other long-term tangible assets
useful in the business of Borrower and its Subsidiaries.

 

(b)   Insurance/Condemnation Proceeds.  Subject to Section 2.15(b), no later
than three (3) Business Days following the date of receipt by Holdings or any of
its Subsidiaries, or Administrative Agent as loss payee, of any Net
Insurance/Condemnation Proceeds, Borrower shall prepay the Loans as set forth in
Section 2.15 in an aggregate amount equal to such Net Insurance/Condemnation
Proceeds; provided, so long as no Default or Event of Default shall have
occurred and be continuing, Borrower shall have the option, directly or through
one or more of its Subsidiaries to invest such Net Insurance/Condemnation
Proceeds within one year of receipt thereof in Real Estate Assets, equipment or
other long-term tangible assets useful in the

 

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business of Borrower and its Subsidiaries, which investment may include the
repair, restoration or replacement of the applicable assets thereof.

 

(c)   Issuance of Debt.  Subject to Section 2.15(b), no later than three
(3) Business Days following the date of receipt by Holdings or any of its
Subsidiaries of any Cash proceeds from the incurrence of any Indebtedness of
Holdings or any of its Subsidiaries (other than with respect to any Indebtedness
permitted to be incurred pursuant to Section 6.1), Borrower shall prepay the
Loans as set forth in Section 2.15 in an aggregate amount equal to 100% of such
proceeds, net of underwriting discounts and commissions and other reasonable
fees, costs and expenses associated therewith, including reasonable legal fees
and expenses.

 

(d)   Consolidated Excess Cash Flow.  Subject to Section 2.15(b), in the event
that there shall be Consolidated Excess Cash Flow for any Fiscal Year
(commencing with the Fiscal Year ending December 31, 2008 (but only to the
extent of Consolidated Excess Cash Flow resulting from operations of the
Acquired Business after the Acquisition)), Borrower shall, no later than
ninety-five days after the end of such Fiscal Year, prepay the Loans as set
forth in Section 2.15 in an aggregate amount equal to (i) 75% of such
Consolidated Excess Cash Flow minus (ii) voluntary repayments of the Loans and
voluntary repayments of the Loans (as defined in the First Lien Credit
Agreement) made from operating cash flow (excluding repayments of Revolving
Loans or Swing Line Loans (each as defined in the First Lien Credit Agreement)
except (x) to the extent the Revolving Commitments (as defined in the First Lien
Credit Agreement) are permanently reduced in connection with such repayments or
(y) to the extent the proceeds thereof are used to fund fees under
Section 2.11(d) of the First Lien Credit Agreement or under
Section 2.11(a) hereof); provided, that if, as of the last day of the most
recently ended Fiscal Year, the Leverage Ratio (determined for any such period
by reference to the Compliance Certificate delivered pursuant to
Section 5.1(d) calculating the Leverage Ratio as of the last day of such Fiscal
Year) shall be (A) 3.00:1.00 or less but greater than 2.50:1.00, Borrower shall
only be required to make the prepayments and/or reductions otherwise required
hereby in an amount equal to (i) 50% of such Consolidated Excess Cash Flow minus
(ii) voluntary repayments of the Loans and voluntary repayments of the Loans (as
defined in the First Lien Credit Agreement) made from operating cash flow
(excluding repayments of Revolving Loans or Swing Line Loans (each as defined in
the First Lien Credit Agreement) except (x) to the extent the Revolving
Commitments (as defined in the First Lien Credit Agreement) are permanently
reduced in connection with such repayments or (y) to the extent the proceeds
thereof are used to fund fees under Section 2.11(d) of the First Lien Credit
Agreement or under Section 2.11(a) hereof); (B) 2.50:1.00 or less but greater
than 2.00:1.00, Borrower shall only be required to make the prepayments and/or
reductions otherwise required hereby in an amount equal to (i) 25% of such
Consolidated Excess Cash Flow minus (ii) voluntary repayments of the Loans and
voluntary repayments of the Loans (as defined in the First Lien Credit
Agreement) made from operating cash flow (excluding repayments of Revolving
Loans or Swing Line Loans (each as defined in the First Lien Credit Agreement)
except (x) to the extent the Revolving Commitments (as defined in the First Lien
Credit Agreement) are permanently reduced in connection with such repayments or
(y) to the extent the proceeds thereof are used to fund fees under
Section 2.11(d) of the First Lien Credit Agreement or under
Section 2.11(a) hereof); or (C) 2.00:1.00 or less, Borrower shall not be
required to make any prepayments otherwise required hereby.

 

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(e)   Restrictions on Prepayments.  Notwithstanding the foregoing provisions of
this Section 2.14, no mandatory prepayment of the Loans shall be made pursuant
to this Section 2.14 (i) to the extent that such net proceeds or Consolidated
Excess Cash Flow are applied to prepay amounts outstanding under, or to
permanently reduce revolving commitments under, the First Lien Credit Agreement
to the extent and in the payment priority required thereunder and (ii) except as
required by Section 2.15(b) or 2.15(c) of the First Lien Credit Agreement,
unless otherwise consented to by Borrower and requisite lenders under the First
Lien Credit Agreement.

 

(f)   Prepayment Certificate.  Concurrently with any prepayment of the Loans
pursuant to Sections 2.14(a) through 2.14(d), Borrower shall deliver to
Administrative Agent a certificate of an Authorized Officer demonstrating the
calculation of the amount of the applicable net cash proceeds or Consolidated
Excess Cash Flow, as the case may be.  In the event that Borrower shall
subsequently determine that the actual amount received exceeded the amount set
forth in such certificate, Borrower shall promptly make an additional prepayment
of the Loans in an amount equal to such excess, and Borrower shall concurrently
therewith deliver to Administrative Agent a certificate of an Authorized Officer
demonstrating the derivation of such excess.

 

2.15.   Application of Prepayments.

 

(a)   Application of Prepayments of Loans to Base Rate Loans and Eurodollar Rate
Loans.  Any prepayment shall be applied first to Base Rate Loans to the full
extent thereof before application to Eurodollar Rate Loans, in each case in a
manner which minimizes the amount of any payments required to be made by
Borrower pursuant to Section 2.18(c).

 

(b)   Waivable Mandatory Prepayment.  Anything contained herein to the contrary
notwithstanding, in the event Borrower is required to make any mandatory
prepayment (a “Waivable Mandatory Prepayment”) of the Loans, not less than three
Business Days prior to the date (the “Required Prepayment Date”) on which
Borrower is required to make such Waivable Mandatory Prepayment, Borrower shall
notify Administrative Agent of the amount of such prepayment, and Administrative
Agent will promptly thereafter notify each Lender of the amount of such Lender’s
Pro Rata Share of such Waivable Mandatory Prepayment and such Lender’s option to
refuse such amount.  Each such Lender may exercise such option by giving written
notice to Borrower and Administrative Agent of its election to do so on or
before the first Business Day prior to the Required Prepayment Date (it being
understood that any Lender which does not notify Borrower and Administrative
Agent of its election to exercise such option on or before the first Business
Day prior to the Required Prepayment Date shall be deemed to have elected, as of
such date, not to exercise such option).  On the Required Prepayment Date,
Borrower shall pay to Administrative Agent that portion of the Waivable
Mandatory Prepayment payable to those Lenders that have elected not to exercise
such option, to prepay the Loans of such Lenders (which prepayment shall be
applied in accordance with Section 2.15(a)), unless otherwise consented to by
Requisite Lenders.  To the extent any remaining amount of the Waivable Mandatory
Prepayment constitutes Consolidated Excess Cash Flow, such amount shall be
prepaid in accordance with Section 2.14(d) of the First Lien Credit Agreement,
without giving effect to Section 2.15(c) of the First Lien Credit Agreement. 
Any remaining amount of the Waivable Mandatory Prepayment not constituting
Consolidated Excess Cash Flow shall be

 

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retained by Borrower and used for any purpose not prohibited by this Agreement
or the other Credit Documents.

 

2.16.   General Provisions Regarding Payments.

 

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

 

(b)   All payments in respect of the principal amount of any Loan (other than
voluntary prepayments of Base Rate Loans) shall be accompanied by payment of
accrued interest on the principal amount being repaid or prepaid, and all such
payments (and, in any event, any payments in respect of any Loan on a date when
interest is due and payable with respect to such Loan) shall be applied to the
payment of interest then due and payable before application to principal.

 

(c)   Administrative Agent (or its agent or sub-agent appointed by it) shall
promptly distribute to each Lender at such address as such Lender shall indicate
in writing, such Lender’s applicable Pro Rata Share of all payments and
prepayments of principal and interest due hereunder, together with all other
amounts due thereto, including all fees payable with respect thereto, to the
extent received by Administrative Agent.

 

(d)   Notwithstanding the foregoing provisions hereof, if any Conversion/
Continuation Notice is withdrawn as to any Affected Lender or if any Affected
Lender makes Base Rate Loans in lieu of its Pro Rata Share of any Eurodollar
Rate Loans, Administrative Agent shall give effect thereto in apportioning
payments received thereafter.

 

(e)   Whenever any payment to be made hereunder with respect to any Loan shall
be stated to be due on a day that is not a Business Day, such payment shall be
made on the next succeeding Business Day.

 

(f)   Borrower hereby authorizes Administrative Agent to charge Borrower’s
accounts with Administrative Agent in order to cause timely payment to be made
to Administrative Agent of all principal, interest, fees and expenses due
hereunder (subject to sufficient funds being available in its accounts for that
purpose); provided that, prior to the Administrative Agent charging any such
accounts, Administrative Agent shall provide Borrower with written notice of
such charge.

 

(g)   Administrative Agent shall deem any payment by or on behalf of Borrower
hereunder that is not made in same day funds prior to 2:00 p.m. (New York City
time) to be a non-conforming payment.  Any such payment shall not be deemed to
have been received by Administrative Agent until the later of (i) the time such
funds become available funds, and (ii) the applicable next Business Day. 
Administrative Agent shall give prompt telephonic notice to Borrower and each
applicable Lender (confirmed in writing) if any payment is non-conforming.

 

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Any non-conforming payment may constitute or become a Default or Event of
Default in accordance with the terms of Section 8.1(a).  Interest shall continue
to accrue on any principal as to which a non-conforming payment is made until
such funds become available funds (but in no event less than the period from the
date of such payment to the next succeeding applicable Business Day) at the rate
determined pursuant to Section 2.10 from the date such amount was due and
payable until the date such amount is paid in full.

 

(h)   Subject to the terms of the Intercreditor Agreement, if an Event of
Default shall have occurred and be continuing, and the maturity of the
Obligations shall have been accelerated pursuant to Section 8.1, all payments or
proceeds received by Agents hereunder in respect of any of the Obligations shall
be applied in accordance with the application arrangements described in
Section 9.2 of the Pledge and Security Agreement.

 

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

 

2.18.   Making or Maintaining Eurodollar Rate Loans.

 

(a)   Inability to Determine Applicable Interest Rate.  In the event that
Administrative Agent shall have determined (which determination shall be final
and conclusive and binding upon all parties hereto), on any Interest Rate
Determination Date with respect to any Eurodollar Rate Loans, that by reason of
circumstances affecting the London interbank market adequate and fair means do
not exist for ascertaining the interest rate applicable to such Loans on the
basis provided for in the definition of Adjusted Eurodollar Rate, Administrative
Agent shall on such date give notice (by telefacsimile or by telephone confirmed
in writing) to Borrower and

 

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each Lender of such determination, whereupon (i) no Loans may be made as, or
converted to, Eurodollar Rate Loans until such time as Administrative Agent
notifies Borrower and Lenders that the circumstances giving rise to such notice
no longer exist, and (ii) any Funding Notice or Conversion/Continuation Notice
given by Borrower with respect to the Loans in respect of which such
determination was made shall be deemed to be rescinded by Borrower.

 

(b)   Illegality or Impracticability of Eurodollar Rate Loans.  In the event
that on any date any Lender shall have determined (which determination shall be
final and conclusive and binding upon all parties hereto but shall be made only
after consultation with Borrower and Administrative Agent) that the making,
maintaining or continuation of its Eurodollar Rate Loans (i) has become unlawful
as a result of compliance by such Lender in good faith with any law, treaty,
governmental rule, regulation, guideline or order (or would conflict with any
such treaty, governmental rule, regulation, guideline or order not having the
force of law even though the failure to comply therewith would not be unlawful),
or (ii) has become impracticable, as a result of contingencies occurring after
the date hereof which materially and adversely affect the London interbank
market or the position of such Lender in that market, then, and in any such
event, such Lender shall be an “Affected Lender” and it shall on that day give
notice (by telefacsimile or by telephone confirmed in writing) to Borrower and
Administrative Agent of such determination (which notice Administrative Agent
shall promptly transmit to each other Lender).  Thereafter (1) the obligation of
the Affected Lender to make Loans as, or to convert Loans to, Eurodollar Rate
Loans shall be suspended until such notice shall be withdrawn by the Affected
Lender, (2) to the extent such determination by the Affected Lender relates to a
Eurodollar Rate Loan then being requested by Borrower pursuant to a Funding
Notice or a Conversion/Continuation Notice, the Affected Lender shall make such
Loan as (or continue such Loan as or convert such Loan to, as the case may be) a
Base Rate Loan, (3) the Affected Lender’s obligation to maintain its outstanding
Eurodollar Rate Loans (the “Affected Loans”) shall be terminated at the earlier
to occur of the expiration of the Interest Period then in effect with respect to
the Affected Loans or when required by law, and (4) the Affected Loans shall
automatically convert into Base Rate Loans on the date of such termination. 
Notwithstanding the foregoing, to the extent a determination by an Affected
Lender as described above relates to a Eurodollar Rate Loan then being requested
by Borrower pursuant to a Funding Notice or a Conversion/Continuation Notice,
Borrower shall have the option, subject to the provisions of Section 2.18(c), to
rescind such Funding Notice or Conversion/Continuation Notice as to all Lenders
by giving notice (by telefacsimile, electronic communication or by telephone
confirmed in writing) to Administrative Agent of such rescission on the date on
which the Affected Lender gives notice of its determination as described above
(which notice of rescission Administrative Agent shall promptly transmit to each
other Lender).  Except as provided in the immediately preceding sentence,
nothing in this Section 2.18(b) shall affect the obligation of any Lender other
than an Affected Lender to make or maintain Loans as, or to convert Loans to,
Eurodollar Rate Loans in accordance with the terms hereof.

 

(c)   Compensation for Breakage or Non-Commencement of Interest Periods. 
Borrower shall compensate each Lender, upon written request by such Lender
(which request shall set forth the basis for requesting such amounts), for all
reasonable losses, expenses and liabilities (including any interest paid by such
Lender to lenders of funds borrowed by it to make or carry its Eurodollar Rate
Loans and any loss, expense or liability sustained by such Lender in connection
with the liquidation or re-employment of such funds but excluding loss of
anticipated

 

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profits) which such Lender may sustain: (i) if for any reason (other than a
default by such Lender) a borrowing of any Eurodollar Rate Loan does not occur
on a date specified therefor in a Funding Notice or a telephonic request for
borrowing, or a conversion to or continuation of any Eurodollar Rate Loan does
not occur on a date specified therefor in a Conversion/Continuation Notice or a
telephonic request for conversion or continuation; (ii) if any prepayment or
other principal payment of, or any conversion of, any of its Eurodollar Rate
Loans occurs on a date prior to the last day of an Interest Period applicable to
that Loan; or (iii) if any prepayment of any of its Eurodollar Rate Loans is not
made on any date specified in a notice of prepayment given by Borrower.

 

(d)   Booking of Eurodollar Rate Loans.  Any Lender may make, carry or transfer
Eurodollar Rate Loans at, to, or for the account of any of its branch offices or
the office of an Affiliate of such Lender.

 

(e)   Assumptions Concerning Funding of Eurodollar Rate Loans.  Calculation of
all amounts payable to a Lender under this Section 2.18 and under Section 2.19
shall be made as though such Lender had actually funded each of its relevant
Eurodollar Rate Loans through the purchase of a Eurodollar deposit bearing
interest at the rate obtained pursuant to clause (i) of the definition of
Adjusted Eurodollar Rate in an amount equal to the amount of such Eurodollar
Rate Loan and having a maturity comparable to the relevant Interest Period and
through the transfer of such Eurodollar deposit from an offshore office of such
Lender to a domestic office of such Lender in the United States of America;
provided, however, each Lender may fund each of its Eurodollar Rate Loans in any
manner it sees fit and the foregoing assumptions shall be utilized only for the
purposes of calculating amounts payable under this Section 2.18 and under
Section 2.19.

 

2.19.   Increased Costs; Capital Adequacy.

 

(a)   Compensation For Increased Costs and Taxes.  Subject to the provisions of
Section 2.20 (which shall be controlling with respect to the matters covered
thereby), in the event that any Lender shall determine (which determination
shall, absent manifest error, be final and conclusive and binding upon all
parties hereto) that any law, treaty or governmental rule, regulation or order,
or any change therein or in the interpretation, administration or application
thereof (including the introduction of any new law, treaty or governmental rule,
regulation or order), or any determination of a court or Governmental Authority,
in each case that becomes effective after the date hereof, or compliance by such
Lender with any guideline, request or directive issued or made after the date
hereof by any central bank or other governmental or quasi-governmental authority
(whether or not having the force of law): (i) subjects such Lender (or its
applicable lending office) to any additional Tax or changes the basis of
taxation of payments to the Lender (other than, in each case, any Tax on the
overall net income of such Lender) with respect to this Agreement or any of the
other Credit Documents or any of its obligations hereunder or thereunder or any
payments to such Lender (or its applicable lending office) of principal,
interest, fees or any other amount payable hereunder; (ii) imposes, modifies or
holds applicable any reserve (including any marginal, emergency, supplemental,
special or other reserve), special deposit, compulsory loan, FDIC insurance or
similar requirement against assets held by, or deposits or other liabilities in
or for the account of, or advances or loans by, or other credit extended by, or
any other acquisition of funds by, any office of such Lender (other

 

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than any such reserve or other requirements with respect to Eurodollar Rate
Loans that are reflected in the definition of Adjusted Eurodollar Rate); or
(iii) imposes any other condition (other than with respect to a Tax matter) on
or affecting such Lender (or its applicable lending office) or its obligations
hereunder or the London interbank market; and the result of any of the foregoing
is to increase the cost to such Lender of maintaining Loans hereunder or to
reduce any amount received or receivable by such Lender (or its applicable
lending office) with respect thereto; then, in any such case, Borrower shall pay
within 10 days to such Lender, upon receipt of the statement referred to in the
next sentence, such additional amount or amounts (in the form of an increased
rate of, or a different method of calculating, interest or otherwise as such
Lender in its sole discretion shall determine) as may be necessary to compensate
such Lender for any such increased cost or reduction in amounts received or
receivable hereunder.  Such Lender shall deliver to Borrower (with a copy to
Administrative Agent) a written statement, setting forth in reasonable detail
the basis for calculating the additional amounts owed to such Lender under this
Section 2.19(a), which statement shall be conclusive and binding upon all
parties hereto absent manifest error.

 

(b)   Capital Adequacy Adjustment.  In the event that any Lender shall have
determined that the adoption, effectiveness, phase-in or applicability after the
Closing Date of any law, rule or regulation (or any provision thereof) regarding
capital adequacy, or any change therein or in the interpretation or
administration thereof by any Governmental Authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by any Lender (or its applicable lending office) with any guideline, request or
directive regarding capital adequacy (whether or not having the force of law) of
any such Governmental Authority, central bank or comparable agency, has or would
have the effect of reducing the rate of return on the capital of such Lender or
any corporation controlling such Lender as a consequence of, or with reference
to, such Lender’s Loans or participations therein or other obligations hereunder
with respect to the Loans to a level below that which such Lender or such
controlling corporation could have achieved but for such adoption,
effectiveness, phase-in, applicability, change or compliance (taking into
consideration the policies of such Lender or such controlling corporation with
regard to capital adequacy), then from time to time, within 10 days after
receipt by Borrower from such Lender of the statement referred to in the next
sentence, Borrower shall pay to such Lender such additional amount or amounts
(including Taxes on payments made pursuant to this Section 2.19(b)) as will
compensate such Lender or such controlling corporation on an after-tax basis for
such reduction; provided that, Borrower shall not be under any obligation to
compensate any Lender with respect to increased costs or reductions with respect
to any period prior to the date that is 180 days prior to such request; provided
further, that the foregoing limitation shall not apply to any increased costs or
reductions arising out of the retroactive application of any change in law
within such 180-day period.  Such Lender shall deliver to Borrower (with a copy
to Administrative Agent) a written statement, setting forth in reasonable detail
the basis for calculating the additional amounts owed to Lender under this
Section 2.19(b), which statement shall be conclusive and binding upon all
parties hereto absent manifest error.

 

2.20.   Taxes; Withholding, etc.

 

(a)   Payments to Be Free and Clear.  All sums payable by or on behalf of any
Credit Party hereunder and under the other Credit Documents shall (except to the
extent required

 

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by law) be paid free and clear of, and without any deduction or withholding on
account of, any Tax (other than a Tax on the overall net income of any Lender)
imposed, levied, collected, withheld or assessed by or within the United States
of America or any political subdivision in or of the United States of America or
any other jurisdiction from or to which a payment is made by or on behalf of any
Credit Party or by any federation or organization of which the United States of
America or any such jurisdiction is a member at the time of payment.

 

(b)   Withholding of Taxes.  If any Credit Party or any other Person is required
by law to make any deduction or withholding on account of any such Tax from any
sum paid or payable by any Credit Party to Administrative Agent or any Lender
under any of the Credit Documents: (i) Borrower shall notify Administrative
Agent of any such requirement or any change in any such requirement as soon as
Borrower becomes aware of it; (ii) Borrower shall pay any such Tax before the
date on which penalties attach thereto, such payment to be made (if the
liability to pay is imposed on any Credit Party) for its own account or (if that
liability is imposed on Administrative Agent or such Lender, as the case may be)
on behalf of and in the name of Administrative Agent or such Lender; (iii) the
sum payable by such Credit Party in respect of which the relevant deduction,
withholding or payment is required shall be increased to the extent necessary to
ensure that, after the making of that deduction, withholding or payment,
Administrative Agent or such Lender, as the case may be, receives on the due
date an amount equal to what it would have received had no such deduction,
withholding or payment been required or made; and (iv) within thirty days after
paying any sum from which it is required by law to make any deduction or
withholding, and within thirty days after the due date of payment of any Tax
which it is required by clause (ii) above to pay, Borrower shall deliver to
Administrative Agent evidence satisfactory to the other affected parties of such
deduction, withholding or payment and of the remittance thereof to the relevant
taxing or other authority.  Notwithstanding anything to the contrary in this
Agreement, no Credit Party shall be required to indemnify or pay any additional
amount to Administrative Agent or any Lender under Section 2.20 to the extent
that such obligation is imposed on amounts payable to Administrative Agent or
such Lender at the time such Person becomes a party to this Agreement.

 

(c)   Payment of Other Taxes by Borrower.  Without limiting the provisions of
paragraph (a) or (b) above, Borrower shall timely pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable law.

 

(d)   Indemnification by Borrower.  Borrower shall indemnify, without
duplication, Administrative Agent and each Lender within ten days after written
demand therefor, for the full amount of any Taxes (other than a Tax on the
overall net income of any Lender) or Other Taxes paid by Administrative Agent or
such Lender on or with respect to any payment by or on account of any obligation
of Borrower hereunder and any penalties, interest and reasonable expenses
arising therefrom or with respect thereto, whether or not such Taxes or Other
Taxes were correctly or legally imposed or asserted by the relevant Governmental
Authority.  A certificate stating the amount of such payment or liability and
setting forth in reasonable detail the calculation thereof delivered to Borrower
by a Lender (with a copy to Administrative Agent), or by Administrative Agent on
its own behalf or on behalf of a Lender shall be conclusive absent manifest
error.

 

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(e)   Evidence of Exemption From U.S. Withholding Tax.  Each Lender that is not
a United States Person (as such term is defined in Section 7701(a)(30) of the
Internal Revenue Code) for U.S. federal income tax purposes (a “Non-US Lender”)
shall deliver to Administrative Agent for transmission to Borrower, on or prior
to the Closing Date (in the case of each Lender listed on the signature
pages hereof on the Closing Date) or on or prior to the date of the Assignment
Agreement pursuant to which it becomes a Lender (in the case of each other
Lender), and at such other times as may be necessary in the determination of
Borrower or Administrative Agent (each in the reasonable exercise of its
discretion), (i) two original Internal Revenue Service Forms W-8BEN, W-8ECI
and/or W-8IMY (or, in each case, any successor forms), properly completed and
duly executed by such Lender, and such other documentation required under the
Internal Revenue Code and reasonably requested by Borrower to establish that
such Lender is not subject to deduction or withholding of United States federal
income tax with respect to any payments to such Lender of principal, interest,
fees or other amounts payable under any of the Credit Documents, or (ii) if such
Lender is not a “bank” or other Person described in Section 881(c)(3) of the
Internal Revenue Code, a Certificate re Non-Bank Status together with two
original Internal Revenue Service Forms W-8BEN (or any successor form), properly
completed and duly executed by such Lender, and such other documentation
required under the Internal Revenue Code and reasonably requested by Borrower to
establish that such Lender is not subject to deduction or withholding of United
States federal income tax with respect to any payments to such Lender of
interest payable under any of the Credit Documents.  Each Lender that is a
United States person (as such term is defined in Section 7701(a)(30) of the
Internal Revenue Code) for United States federal income tax purposes (a “U.S.
Lender”) and is not an exempt recipient within the meaning of Treasury
Regulation Section 1.6049-4(c) shall deliver to Administrative Agent and
Borrower on or prior to the Closing Date (or, if later, on or prior to the date
on which such Lender becomes a party to this Agreement) two original copies of
Internal Revenue Service Form W-9 (or any successor form), properly completed
and duly executed by such Lender, certifying that such U.S. Lender is entitled
to an exemption from United States backup withholding tax, or otherwise prove
that it is entitled to such an exemption. Each Lender required to deliver any
forms, certificates or other evidence with respect to United States federal
income tax withholding matters pursuant to this Section 2.20(e) hereby agrees,
from time to time after the initial delivery by such Lender of such forms,
certificates or other evidence, whenever a lapse in time or change in
circumstances renders such forms, certificates or other evidence obsolete or
inaccurate in any material respect, that such Lender shall promptly deliver to
Administrative Agent for transmission to Borrower two new original copies of
Internal Revenue Service Form W-8BEN, W-8ECI and/or W-8IMY (or, in each case,
any successor form), or a Certificate re Non-Bank Status and two original copies
of Internal Revenue Service Form W-8BEN (or any successor form), as the case may
be, properly completed and duly executed by such Lender, and such other
documentation required under the Internal Revenue Code and reasonably requested
by Borrower to confirm or establish that such Lender is not subject to deduction
or withholding of United States federal income tax with respect to payments to
such Lender under the Credit Documents, or notify Administrative Agent and
Borrower of its inability to deliver any such forms, certificates or other
evidence.  Borrower shall not be required to indemnify or pay any additional
amount to Administrative Agent or any Lender under Section 2.20(b)(iii) if such
Lender shall have failed (1) to deliver the forms, certificates or other
evidence referred to in the first or second sentence of this Section 2.20(e), or
(2) to notify Administrative Agent and Borrower of its inability to deliver any
such forms, certificates or other evidence, as

 

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the case may be; provided, if such Lender shall have satisfied the requirements
of the first or second sentence of this Section 2.20(e) on the Closing Date or
on the date of the Assignment Agreement pursuant to which it became a Lender, as
applicable, nothing in this last sentence of Section 2.20(e) shall relieve
Borrower of its obligation to pay any additional amounts pursuant this
Section 2.20 in the event that, as a result of any change in any applicable law,
treaty or governmental rule, regulation or order, or any change in the
interpretation, administration or application thereof, such Lender is no longer
properly entitled to deliver forms, certificates or other evidence at a
subsequent date establishing the fact that such Lender is not subject to
withholding as described herein.  Notwithstanding any other provision of this
paragraph, a Lender shall not be required to deliver any form pursuant to this
paragraph that such Lender is not legally entitled to deliver.

 

(f)   Refunds.  If Administrative Agent or a Lender determines, in its sole
discretion, that it has received a refund of any Tax as to which it has been
indemnified by Borrower or with respect to which Borrower has paid additional
amounts pursuant to this Section 2.20, it shall pay over such refund to Borrower
(but only to the extent of indemnity payments made, or additional amounts paid,
by Borrower under this Section 2.20 with respect to the Tax giving rise to such
refund), net of all out-of-pocket expenses of Administrative Agent or such
Lender and without interest (other than any interest paid by the relevant
Governmental Authority with respect to such refund); provided that Borrower,
upon the request of Administrative Agent or such Lender, agrees to repay the
amount paid over to Borrower (plus any penalties, interest or other charges
imposed by the relevant Governmental Authority) to Administrative Agent or such
Lender in the event Administrative Agent or such Lender is required to repay
such refund to such Governmental Authority.  This Section shall not be construed
to require Administrative Agent or any Lender to make available its tax returns
(or any other information relating to its taxes which it deems confidential) to
Borrower or any other Person.

 

2.21.   Obligation to Mitigate.  Each Lender agrees that, as promptly as
practicable after the officer of such Lender responsible for administering its
Loans becomes aware of the occurrence of an event or the existence of a
condition that would cause such Lender to become an Affected Lender or that
would entitle such Lender to receive payments under Section 2.18, 2.19 or 2.20,
it will, to the extent not inconsistent with the existing internal policies of
such Lender and any applicable legal or regulatory restrictions, use reasonable
efforts to (a) make, issue, fund or maintain its Credit Extensions, including
any Affected Loans, through another office of such Lender, or (b) take such
other measures as such Lender may deem reasonable, if as a result thereof the
circumstances which would cause such Lender to be an Affected Lender would cease
to exist or the additional amounts which would otherwise be required to be paid
to such Lender pursuant to Section 2.18, 2.19 or 2.20 would be reduced and if,
as determined by such Lender in its discretion, the making, issuing, funding or
maintaining of such Loans through such other office or in accordance with such
other measures, as the case may be, would not otherwise adversely affect such
Loans or the interests of such Lender; provided, such Lender will not be
obligated to utilize such other office pursuant to this Section 2.21 unless
Borrower agrees to pay all reasonable out-of-pocket incremental expenses
incurred by such Lender as a result of utilizing such other office as described
above.  A certificate as to the amount of any such expenses payable by Borrower
pursuant to this Section 2.21 (setting forth in reasonable detail the

 

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basis for requesting such amount) submitted by such Lender to Borrower (with a
copy to Administrative Agent) shall be conclusive absent manifest error.

 

2.22.   Intentionally Omitted.

 

2.23.   Removal or Replacement of a Lender.  Anything contained herein to the
contrary notwithstanding, in the event that: (a) (i) any Lender (an
“Increased-Cost Lender”) shall give notice to Borrower that such Lender is an
Affected Lender or that such Lender is entitled to receive payments under
Section 2.18, 2.19 or 2.20, (ii) the circumstances which have caused such Lender
to be an Affected Lender or which entitle such Lender to receive such payments
shall remain in effect, and (iii) such Lender shall fail to withdraw such notice
within five Business Days after Borrower’s request for such withdrawal; or
(b) in connection with any proposed amendment, modification, termination, waiver
or consent with respect to any of the provisions hereof as contemplated by
Section 10.5(b), the consent of Requisite Lenders shall have been obtained but
the consent of one or more of such other Lenders (each a “Non-Consenting
Lender”) whose consent is required shall not have been obtained; then, with
respect to each such Increased-Cost Lender or Non-Consenting Lender (the
“Terminated Lender”), Borrower may, by giving written notice to Administrative
Agent and any Terminated Lender of its election to do so, elect to cause such
Terminated Lender (and such Terminated Lender hereby irrevocably agrees) to
assign its outstanding Loans in full to one or more Eligible Assignees (each a
“Replacement Lender”) in accordance with the provisions of Section 10.6 and
Borrower shall pay the fees, if any, payable thereunder in connection with any
such assignment from an Increased Cost Lender or a Non-Consenting Lender;
provided, (1) on the date of such assignment, the Replacement Lender shall pay
to Terminated Lender an amount equal to the sum of (A) an amount equal to the
principal of, and all accrued interest on, all outstanding Loans of the
Terminated Lender and (B) an amount equal to all accrued, but theretofore unpaid
fees owing to such Terminated Lender pursuant to Section 2.11; (2) on the date
of such assignment, Borrower shall pay any amounts payable to such Terminated
Lender pursuant to Section 2.18(c), 2.19 or 2.20; or otherwise as if it were a
prepayment to which Section 2.13(c) applies and (3) in the event such Terminated
Lender is a Non-Consenting Lender, each Replacement Lender shall consent, at the
time of such assignment, to each matter in respect of which such Terminated
Lender was a Non-Consenting Lender.  Upon the prepayment of all amounts owing to
any Terminated Lender, such Terminated Lender shall no longer constitute a
“Lender” for purposes hereof; provided, any rights of such Terminated Lender to
indemnification hereunder shall survive as to such Terminated Lender.  Each
Lender agrees that if Borrower exercises its option hereunder to cause an
assignment by such Lender as a Non-Consenting Lender or Terminated Lender, such
Lender shall, promptly after receipt of written notice of such election, execute
and deliver all documentation necessary to effectuate such assignment in
accordance with Section 10.6.  In the event that a Lender does not comply with
the requirements of the immediately preceding sentence within one Business Day
after receipt of such notice, each Lender hereby authorizes and directs
Administrative Agent to execute and deliver such documentation as may be
required to give effect to an assignment in accordance with Section 10.6 on
behalf of a Non-Consenting Lender or Terminated Lender and any such
documentation so executed by Administrative Agent shall be effective for
purposes of documenting an assignment pursuant to Section 10.6.

 

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SECTION 3.   CONDITIONS PRECEDENT

 

3.1.   Closing Date.  The obligation of each Lender to make a Credit Extension
on the Closing Date is subject to each Agent’s satisfaction, or waiver, of the
following conditions on or before the Closing Date:

 

(a)   Credit Documents.  Administrative Agent shall have received either
(i) sufficient copies of each Credit Document originally executed and delivered
by each applicable Credit Party for each Lender or (ii) written evidence
reasonably satisfactory to the Administrative Agent (which may include
telefacsimile or electronic communication of copies of executed signature
pages of each Credit Document) that each applicable Credit Party has signed a
counterpart of each Credit Document to which it is a party..

 

(b)   Organizational Documents; Incumbency.  Administrative Agent shall have
received originals or copies of (i) each Organizational Document executed and
delivered by each Credit Party, as applicable, and, to the extent applicable,
certified as of a recent date by the appropriate governmental official, each
dated the Closing Date or a recent date prior thereto; (ii) signature and
incumbency certificates of the officers of such Credit Party executing the
Credit Documents to which it is a party; (iii) resolutions of the Board of
Directors or similar governing body of each Credit Party approving and
authorizing the execution, delivery and performance of this Agreement and the
other Credit Documents to which it is a party or by which it or its assets may
be bound as of the Closing Date, certified as of the Closing Date by its
secretary or an assistant secretary as being in full force and effect without
modification or amendment and (iv) a good standing certificate from the
applicable Governmental Authority of each Credit Party’s jurisdiction of
incorporation, organization or formation and in each material jurisdiction in
which it is qualified as a foreign corporation or other entity to do business,
each dated a recent date prior to the Closing Date.

 

(c)   Capitalization of Holdings and Borrower.  On or before the Closing Date,
Holdings or Borrower, as applicable, shall have received (i) the Equity
Contribution and (ii) at least $725,000,000 of gross proceeds from the initial
borrowings under the First Lien Credit Agreement, and Administrative Agent shall
have received executed copies of all documentation relating to the First Lien
Credit Agreement, in form and substance reasonably satisfactory to it.

 

(d)   Consummation of Transactions Contemplated by Related Agreements.

 

(i)   (1) All conditions (other than those which the failure to satisfy would
not have an adverse effect on the Lenders) to the Acquisition set forth in the
Acquisition Agreement shall have been satisfied or the fulfillment of any such
conditions shall have been waived with the consent of Administrative Agent and
Syndication Agent, (2) the Acquisition shall have been consummated in accordance
with the terms of the Acquisition Agreement and (3) the Acquisition shall have
been approved by the shareholders of Parent in accordance with its certificate
of incorporation and the shareholders of Parent shall not have exercised
conversion rights with respect to more than 40% of the shares issued in Parent’s
initial public offering.

 

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(ii)   Administrative Agent and Syndication Agent shall each have received a
fully executed or conformed copy of the Acquisition Agreement (including the
schedules and exhibits thereto) and any material documents executed in
connection therewith.  Each Related Agreement shall be in full force and effect,
and no provision thereof shall have been modified or waived in any respect
determined by Administrative Agent or Syndication Agent to be adverse to the
Lenders, in each case without the consent of Administrative Agent and
Syndication Agent.

 

(e)   Existing Indebtedness; No Default.  On the Closing Date, Boise Cascade,
L.L.C. shall have (i) repaid in full all Existing Indebtedness, (ii) terminated
any commitments to lend or make other extensions of credit thereunder,
(iii) delivered to Administrative Agent and Syndication Agent all customary
payoff letters necessary to release all Liens securing Existing Indebtedness or
other obligations of Holdings and its Subsidiaries thereunder being repaid on
the Closing Date, (iv) made arrangements reasonably satisfactory to
Administrative Agent and Syndication Agent with respect to the cancellation of
any letters of credit outstanding thereunder or the issuance of Letters of
Credit (under and as defined in the First Lien Credit Agreement) to support the
obligations of Holdings and its Subsidiaries with respect thereto, and
(v) caused the release of guarantees, if any, of Holdings and its Subsidiaries
of the $400,000,000 senior subordinated notes due 2014 issued by Boise Cascade,
L.L.C. and Boise Cascade Finance Corporation.  No default shall have occurred
and be continuing on the Closing Date under any material Indebtedness of
Holdings or any of its Subsidiaries that will remain outstanding after the
Closing Date.

 

(f)   Funds Flow Memorandum.  On or prior to the Closing Date, Borrower shall
have delivered to Administrative Agent a funds flow memorandum.

 

(g)   Governmental Authorizations and Consents.  Each Credit Party shall have
obtained all Governmental Authorizations and all material consents of other
Persons, in each case that are necessary in connection with the transactions
contemplated by the Credit Documents and the Related Agreements and each of the
foregoing shall be in full force and effect and in form and substance reasonably
satisfactory to Administrative Agent and Syndication Agent.  All applicable
waiting periods shall have expired without any action being taken or threatened
by any competent authority which would restrain, prevent or otherwise impose
adverse conditions on the transactions contemplated by the Credit Documents or
the Related Agreements or the financing thereof and no action, request for stay,
petition for review or rehearing, reconsideration, or appeal with respect to any
of the foregoing shall be pending, and the time for any applicable agency to
take action to set aside its consent on its own motion shall have expired.

 

(h)   Real Estate Assets.  In order to create in favor of Collateral Agent, for
the benefit of Secured Parties, a valid and, subject to any filing and/or
recording referred to herein, perfected Second Priority security interest in
certain Real Estate Assets, Collateral Agent shall have received from Borrower
and each applicable Guarantor:

 

(i)   fully executed and notarized Mortgages, in proper form for recording in
all appropriate places in all applicable jurisdictions, encumbering each Real
Estate Asset listed in Schedule 3.1(h) (each, a “Closing Date Mortgaged
Property’’);

 

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(ii)   an opinion of counsel (which counsel shall be reasonably satisfactory to
Collateral Agent; provided that any counsel used in connection with the creation
of Liens securing Existing Indebtedness shall be deemed to be reasonably
satisfactory to the Collateral Agent) in each state in which a Closing Date
Mortgaged Property is located with respect to the enforceability of the
form(s) of Mortgages to be recorded in such state and such other matters as
Collateral Agent may reasonably request, in each case in form and substance
reasonably satisfactory to Collateral Agent;

 

(iii)   in the case of each Leasehold Property that is a Closing Date Mortgaged
Property, (1) a Landlord Consent and Estoppel and (2) evidence that such
Leasehold Property is a Recorded Leasehold Interest;

 

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

 

(v)   flood certifications with respect to all Closing Date Mortgaged Properties
and evidence of flood insurance with respect to each Flood Hazard Property that
is located in a community that participates in the National Flood Insurance
Program, in each case in compliance with any applicable regulations of the Board
of Governors, in form and substance reasonably satisfactory to Collateral Agent;
and

 

(vi)   surveys (which may be ALTA surveys or surveys in the form of Express Maps
prepared by First American Title Insurance Company) of the Closing Date
Mortgaged Properties identified on Schedule 3.1(h)(vi), certified to Collateral
Agent and dated not more than 60 days prior to the Closing Date; provided that,
“No Change” affidavits shall be accepted by the Collateral Agent in lieu of new
ALTA surveys so long as the same are acceptable to the applicable title
companies and the Collateral Agent is able to obtain ALTA mortgagee title
insurance policies in form and substance reasonably satisfactory to Collateral
Agent on the basis of the same.

 

Notwithstanding the foregoing, with respect to any Closing Date Mortgaged
Property with respect to which the documents, opinions and actions described in
clauses (i) through (vi) above have not been delivered or taken on or prior to
the Closing Date, the delivery of such documents and opinions and the taking of
such actions shall not

 

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constitute a condition precedent to the initial Credit Extension, and Borrower
shall deliver or cause to be delivered such documents and opinions, and take or
cause to be taken such other actions, as may be required under clauses
(i) through (vi) above, within the periods set forth in the Post-Closing
Agreement.

 

(i)   Personal Property Collateral.  In order to create in favor of Collateral
Agent, for the benefit of Secured Parties, a valid and, subject to any filing
and/or recording referred to herein, perfected Second Priority security interest
in the personal property Collateral, each Credit Party shall have delivered to
Collateral Agent originals or copies of:

 

(i)   evidence reasonably satisfactory to Collateral Agent of the compliance by
each applicable Credit Party of their obligations under the Pledge and Security
Agreement and the other Collateral Documents (including their obligations to
execute and deliver UCC financing statements, originals of Securities,
instruments and chattel paper and their use of commercially reasonable efforts
to deliver any agreements governing deposit and/or Securities accounts as
provided therein);

 

(ii)   a completed Collateral Questionnaire dated the Closing Date and executed
by an Authorized Officer of each Credit Party, together with all attachments
contemplated thereby;

 

(iii)   fully executed Intellectual Property Security Agreements; and

 

(iv)   evidence that each Credit Party shall have used commercially reasonable
efforts to execute and deliver or caused to be executed and delivered any other
agreement, document and instrument (including (i) a Landlord Personal Property
Collateral Access Agreement executed by the landlord of any Leasehold Property
and by the applicable Credit Party (other than with respect to (1) the corporate
headquarters of the Acquired Business and (2) any Leasehold Property containing
personal property Collateral with an estimated value of less than $5,000,000)
and (ii) any intercompany notes evidencing Indebtedness permitted to be incurred
pursuant to Section 6.1(b)) and made or caused to be made any other filing and
recording (other than as set forth herein) reasonably required by Collateral
Agent.

 

(j)   Financial Statements; Projections.  Arrangers shall have received from
Holdings (i) the Historical Financial Statements, (ii) pro forma consolidated
balance sheets and related statements of income and cash flows of Holdings and
its Subsidiaries as at December 31, 2007, and reflecting the consummation of the
Acquisition, the relating financings and the other transactions contemplated by
the Credit Documents and the First Lien Credit Agreement to occur on or prior to
the Closing Date, which pro forma financial statements shall meet the
requirements of Regulation S-X for Form S-1 registration statements (other than
(A) the adjustments to Consolidated Adjusted EBITDA set forth in clauses
(e) through (j) of the definition thereof, (B) as required by Rule 3-10 of
Regulation S-X and (C) other adjustments as Arrangers and Borrower have agreed
are appropriate prior to the Closing Date), and (iii) the Projections.

 

(k)   Evidence of Insurance.  Collateral Agent shall have received a certificate
from Borrower’s insurance broker or other evidence reasonably satisfactory to it
that all

 

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insurance required to be maintained pursuant to Section 5.5 is in full force and
effect, together with endorsements naming the Collateral Agent, for the benefit
of Secured Parties, as additional insured and loss payee thereunder to the
extent required under Section 5.5.

(l)   Opinions of Counsel to Credit Parties.  Lenders and their respective
counsel shall have received executed originals or copies of the favorable
written opinions of (i) Kirkland & Ellis LLP, counsel for Credit Parties (other
than Holdings, Aldabra and Minnesota, Dakota & Western Railway Company (“MDWR”),
(ii) Kramer Levin Naftalis & Frankel LLP, counsel for Holdings and Aldabra and
(iii) Parinsen, Kaplan, Rosberg & Gotlieb P.A., counsel to MDWR, in each case as
to such matters as Administrative Agent or Syndication Agent may reasonably
request, dated as of the Closing Date in form and substance reasonably
satisfactory to Administrative Agent and Syndication Agent (and each Credit
Party hereby instructs such counsel to deliver such opinions to Agents and
Lenders).

 

(m)   Compliance with Commitment Letter and Fee Letter.  Borrower shall have
paid to Agents and Lenders, as the case may be, the fees payable on the Closing
Date referred to in Sections 2.11(a) and (b) and shall have complied in all
material respects with all of its other obligations under the Commitment Letter
and the Fee Letter.

 

(n)   Solvency Certificate.  On the Closing, Date Administrative Agent and
Syndication Agent shall have received a Solvency Certificate from Borrower in
form, scope and substance reasonably satisfactory to Administrative Agent and
Syndication Agent, and demonstrating that after giving effect to the
consummation of the Acquisition and the initial borrowings hereunder and under
the First Lien Credit Agreement, Borrower and its Subsidiaries are and will be
Solvent on a consolidated basis.

 

(o)   Closing Date Certificate.  Borrower shall have delivered to Administrative
Agent and Syndication Agent an original or copy of an executed Closing Date
Certificate, together with all attachments thereto.

 

(p)   No Litigation.  There shall not exist any action, suit, investigation,
litigation, proceeding or other legal or regulatory developments, pending or, to
the knowledge of Borrower, threatened in any court or before any arbitrator or
Governmental Authority that, in the reasonable opinion of Administrative Agent
and Syndication Agent, individually or in the aggregate, materially impairs the
Acquisition, the related transactions or the financing thereof or that seeks to
impose liability on any of the Arrangers, Lenders, Holdings and/or Borrower in
connection with any indebtedness of Boise Cascade, L.L.C. that is remaining
outstanding after consummation of the Acquisition.

 

(q)   Maximum Leverage Ratio.  The ratio of (i) (A) Consolidated Total Debt as
of the Closing Date after giving effect to the Acquisition, the transactions
contemplated herein and under the First Lien Credit Agreement minus
(B) $44,500,000 to (ii) pro forma Consolidated Adjusted EBITDA after giving
effect to the Acquisition (calculated in accordance with Regulation S-X together
with such additional adjustments that Arrangers agree are appropriate) for the
twelve-month period ended December 31, 2007 shall not be greater than 4.29:1.00.

 

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(r)   Patriot Act.  At least 10 days prior to the Closing Date, Arrangers shall
have received all reasonably requested documentation and other information
required by bank regulatory authorities under applicable “know-your-customer”
and anti-money laundering rules and regulations, including the U.S.A. Patriot
Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001) the “Patriot
Act”); provided, that Arrangers have made such request to Borrower at least 15
days prior to the Closing Date.

 

(s)   No Material Adverse Change.  Since December 31, 2006, no Material Adverse
Change shall have occurred.

 

(t)   Funding Notice.  Administrative Agent shall have received a fully executed
and delivered Funding Notice.

 

(u)   Representations and Warranties.  The representations and warranties
contained herein and in the other Credit Documents shall be true and correct in
all material respects (except that any representation or warranty that is
qualified as to materiality or Material Adverse Effect shall be true and correct
in all respects) on and as of the Closing Date to the same extent as though made
on and as of that date, except to the extent such representations and warranties
specifically relate to an earlier date, in which case such representations and
warranties shall have been true and correct in all material respects (except
that any representation or warranty that is qualified as to materiality or
Material Adverse Effect shall have been true and correct in all respects) on and
as of such earlier date; provided that, solely for the purpose of satisfying
this Section 3.1(u) on the Closing Date (and not for the purpose of determining
whether an Event of Default under Section 8.1(d) has occurred), any reference to
Material Adverse Effect in Section 4 shall be deemed to mean a Material Adverse
Change.

 

(v)   No Default.  No event shall have occurred and be continuing or would
result from the consummation of the applicable Credit Extension that would
constitute an Event of Default or a Default; provided that, solely for the
purpose of satisfying this Section 3.1(v) on the Closing Date (and not for the
purpose of determining whether an Event of Default under Section 8.1(c) and/or
Section 8.1(e) has occurred), any reference to Material Adverse Effect in
Sections 4 and 5 shall be deemed to mean a Material Adverse Change.

 

3.2.   Notices.  Any Notice shall be executed by an Authorized Officer in a
writing delivered to Administrative Agent.  In lieu of delivering a Notice,
Borrower may give Administrative Agent telephonic notice by the required time of
any proposed borrowing or conversion/continuation, as the case may be; provided
each such notice shall be promptly confirmed in writing by delivery of the
applicable Notice to Administrative Agent on or before the applicable date of
borrowing or continuation/conversion.  Neither Administrative Agent nor any
Lender shall incur any liability to Borrower in acting upon any telephonic
notice referred to above that Administrative Agent believes in good faith to
have been given by a duly authorized officer or other person authorized on
behalf of Borrower or for otherwise acting in good faith.

 

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SECTION 4.   REPRESENTATIONS AND WARRANTIES

 

In order to induce Lenders to enter into this Agreement and to make each Credit
Extension to be made thereby, each Credit Party represents and warrants to each
Lender, on the Closing Date (it being understood and agreed that the
representations and warranties made on the Closing Date are deemed to be made
concurrently with the consummation of the Acquisition and the related
transactions contemplated hereby):

 

4.1.   Organization; Requisite Power and Authority; Qualification.  Each of
Holdings and its Subsidiaries (a) is duly organized, validly existing and in
good standing under the laws of its jurisdiction of organization as identified
in Schedule 4.1, (b) has all requisite power and authority to carry on its
business as now conducted, to enter into the Credit Documents to which it is a
party and to carry out the transactions contemplated thereby, and (c) is
qualified to do business and in good standing in every jurisdiction where its
assets are located and wherever necessary to carry out its business and
operations, except in jurisdictions where the failure to be so qualified or in
good standing could not be reasonably expected to have, individually or in the
aggregate, a Material Adverse Effect.

 

4.2.   Equity Interests and Ownership.  The Equity Interests of each of Holdings
and its Subsidiaries have been duly authorized and validly issued and are fully
paid and, with respect to corporate shares, non-assessable.  Except as set forth
on Schedule 4.2, as of the date hereof, there is no existing option, warrant,
call, right, commitment or other agreement to which Borrower or any of its
Subsidiaries is a party requiring, and there is no membership interest or other
Equity Interests of Borrower or any of its Subsidiaries outstanding which upon
conversion or exchange would require the issuance by Borrower or any of its
Subsidiaries of any additional membership interests or other Equity Interests of
Borrower or any of its Subsidiaries or other Securities convertible into,
exchangeable for or evidencing the right to subscribe for or purchase, a
membership interest or other Equity Interests of Borrower or any of its
Subsidiaries.  Schedule 4.2 correctly sets forth the ownership interest of
Holdings and each of its Subsidiaries in their respective Subsidiaries as of the
Closing Date.

 

4.3.   Due Authorization.  The execution, delivery and performance of the Credit
Documents have been duly authorized by all necessary action on the part of each
Credit Party that is a party thereto.

 

4.4.   No Conflict.  The execution, delivery and performance by Credit Parties
of the Credit Documents to which they are parties and the consummation of the
transactions contemplated by the Credit Documents to which they are parties do
not and will not (a) violate (i) any provision of any law or any governmental
rule or regulation applicable to Holdings or any of its Subsidiaries, (ii) any
of the Organizational Documents of Holdings or any of its Subsidiaries, or
(iii) any order, judgment or decree of any court or other agency of government
binding on Holdings or any of its Subsidiaries; (b) conflict with, result in a
breach of or constitute (with due notice or lapse of time or both) a default
under any Contractual Obligation of Holdings or any of its Subsidiaries;
(c) result in or require the creation or imposition of any Lien upon any of the
properties or assets of Holdings or any of its Subsidiaries (other than any
Liens created under any of the Credit Documents in favor of Collateral Agent, on
behalf of Secured Parties); or (d) require any approval of stockholders, members
or partners or any

 

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approval or consent of any Person under any Contractual Obligation of Holdings
or any of its Subsidiaries, except for any such approval or consent (i) which
will be obtained on or before the Closing Date and disclosed in writing to
Lenders or (ii) where the failure to obtain such approval or consent could not
reasonably be expected to have a Material Adverse Effect.

 

4.5.   Governmental Consents.  The execution, delivery and performance by the
Credit Parties of the Credit Documents to which they are parties and the
consummation of the transactions contemplated by the Credit Documents to which
they are parties do not and will not require any registration with, consent or
approval of, or notice to, or other action to, with or by, any Governmental
Authority except (a) as otherwise set forth in the Acquisition Agreement, (b) as
have been obtained or made on or prior to the date hereof and (c) for filings
and recordings with respect to (i) the Collateral to be made or otherwise
delivered to Collateral Agent for filing and/or recordation and (ii) the
collateral for the First Lien Credit Agreement to be made or otherwise delivered
to the First Lien Collateral Agent for filing and/or recordation.

 

4.6.   Binding Obligation.  This Agreement has been duly executed and delivered
by each Credit Party that is a party hereto and constitutes, and each other
Credit Document to which any Credit Party is a party, when executed and
delivered by such Credit Party will constitute, a legal, valid and binding
obligation of such Credit Party, enforceable against such Credit Party in
accordance with its respective terms, except as may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws relating to or limiting
creditors’ rights generally or by equitable principles relating to
enforceability, regardless of whether considered in a proceeding in equity or at
law.

 

4.7.   Historical Financial Statements.  The Historical Financial Statements set
forth in (a) clauses (i) and (ii) of the definition thereof were prepared in
conformity with GAAP and fairly present, in all material respects, the financial
position, on a consolidated basis, of the Persons described in such financial
statements as at the respective dates thereof and the results of operations and
cash flows, on a consolidated basis, of the entities described therein for each
of the periods then ended, subject, in the case of any such unaudited financial
statements, to the absence of footnotes and changes resulting from audit and
normal year-end adjustments and (b) clause (iii) of the definition thereof were
prepared with the customary accounting methods, policies, practices and
procedures, including classification and estimation methodology, used by Boise
Cascade, L.L.C. and its parent company with respect to Boise White Paper, L.L.C.
and Boise Packaging & Newsprint, L.L.C. during their annual and interim
accounting periods from January 1, 2005 through the date hereof.  As of the
Closing Date, neither Holdings nor any of its Subsidiaries has any contingent
liability or liability for taxes, long-term lease or unusual forward or
long-term commitment that is not reflected in the Historical Financial
Statements or the notes thereto and which in any such case is material in
relation to the business, operations, assets or financial condition of Holdings
and any of its Subsidiaries taken as a whole as required by GAAP.

 

4.8.   Projections.  On and as of the Closing Date, the projections of Holdings
and its Subsidiaries for the period of Fiscal Year 2008 through and including
Fiscal Year 2012 (the “Projections”) are based on good faith estimates and
assumptions (including estimates from third party sources) believed to be
reasonable by the management of Holdings at the time of preparation; provided,
the Projections are not to be viewed as facts, and it being understood that

 

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such Projections are subject to significant uncertainties and contingencies,
many of which are beyond Holdings’ and its Subsidiaries’ control, that no
assurance can be given that such Projections will be realized, that actual
results during the period or periods covered by the Projections may differ from
such Projections and that the differences may be material; provided further, as
of the Closing Date, management of Holdings believed that the Projections were
reasonable and attainable at the time of preparation.

 

4.9.   No Material Adverse Change.  Since December 31, 2006, no event,
circumstance or change has occurred that has caused or evidences, either in any
case or in the aggregate, a Material Adverse Effect.

 

4.10.   Reserved.

 

4.11.   Adverse Proceedings, etc.  There are no Adverse Proceedings,
individually or in the aggregate, that could reasonably be expected to have a
Material Adverse Effect.

 

4.12.   Payment of Taxes.  Except as otherwise permitted under Section 5.3, all
federal and state income tax returns and all other material tax returns and
reports of Holdings and its Subsidiaries required to be filed by any of them
have been timely filed, and all taxes shown on such tax returns to be due and
payable and all assessments, fees and other governmental charges upon Holdings
and its Subsidiaries and upon their respective properties, assets, income,
businesses and franchises which are due and payable have been paid when due and
payable.  Holdings knows of no proposed tax assessment against Holdings or any
of its Subsidiaries except for any such assessment for which appropriate
reserves have been established in accordance with GAAP or that is being actively
contested by Holdings or such Subsidiary in good faith and by appropriate
proceedings; provided, in each case, such reserves or other appropriate
provisions, if any, as shall be required in conformity with GAAP shall have been
made or provided therefor.

 

4.13.   Properties.

 

(a)   Title.  Each of Holdings and its Subsidiaries has good and marketable fee
or leasehold, as applicable, title to all of their respective properties and
assets (other than Intellectual Property) reflected in their respective
Historical Financial Statements referred to in Section 4.7 and in the most
recent financial statements delivered pursuant to Section 5.1, in each case
except for (w) Real Estate listed on Schedule 4.13(a) with respect to which a
binding contract of sale has been entered into on or prior to the Closing Date,
(x) assets disposed of since the date of such financial statements in the
ordinary course of business, (y) minor defects in title that do not interfere
with their ability to conduct their respective businesses as currently conducted
or to utilize such properties for their intended purposes or (z) as otherwise
permitted under Section 6.8.  With respect to Intellectual Property, the
representations and warranties set forth in Section 5.7(a) of the Pledge and
Security Agreement are incorporated in this Section 4.13(a).  Except as
permitted by this Agreement, all such properties and assets are free and clear
of Liens.

 

(b)   Real Estate.  As of the Closing Date, Schedule 4.13(b) contains a true,
accurate and complete list of (i) all Real Estate Assets (excluding leases and
subleases with rental payments of less than $100,000 per year), and (ii) all
leases, subleases or assignments of

 

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leases (together with all amendments, modifications, supplements, renewals or
extensions of any thereof) with rental payments in excess of $100,000 per year
affecting each Real Estate Asset of any Credit Party, regardless of whether such
Credit Party is the landlord or tenant (whether directly or as an assignee or
successor in interest) under such lease, sublease or assignment.  Each agreement
listed in clause (ii) of the immediately preceding sentence is in full force and
effect and Holdings does not have knowledge of any default that has occurred and
is continuing thereunder, and each such agreement constitutes the legally valid
and binding obligation of each applicable Credit Party, enforceable against such
Credit Party in accordance with its terms, except as enforcement may be limited
by bankruptcy, insolvency, reorganization, moratorium or similar laws relating
to or limiting creditors’ rights generally or by equitable principles.

 

4.14.   Environmental Matters.  Neither Holdings nor any of its Subsidiaries nor
any of their respective Facilities or operations are subject to any outstanding
written order, consent decree or settlement agreement with any Person relating
to any Environmental Law, any Environmental Claim, or any Hazardous Materials
Activity that, individually or in the aggregate, could reasonably be expected to
have a Material Adverse Effect.  Neither Holdings nor any of its Subsidiaries
has received any letter or request for information under Section 104 of the
Comprehensive Environmental Response, Compensation, and Liability Act (42 U.S.C.
§ 9604) or any comparable state law where the subject of such letter or request
could reasonably be expected to result in a Material Adverse Effect.  There are
and, to each of Holdings’ and its Subsidiaries’ knowledge, have been, no
conditions, occurrences, or Hazardous Materials Activities which could
reasonably be expected to form the basis of an Environmental Claim against
Holdings or any of its Subsidiaries that, individually or in the aggregate,
could reasonably be expected to have a Material Adverse Effect.  Neither
Holdings nor any of its Subsidiaries nor, to any Credit Party’s knowledge, any
predecessor of Holdings or any of its Subsidiaries has filed any notice under
any Environmental Law indicating past or present treatment of Hazardous
Materials at any Facility, and none of Holdings’ or any of its Subsidiaries’
operations involves the generation, transportation, treatment, storage or
disposal of hazardous waste, as defined under 40 C.F.R. Parts 260-270 or any
state equivalent, which, in either case, could reasonably be expected to result
in a Material Adverse Effect.  Compliance with all current or reasonably
foreseeable future requirements pursuant to or under Environmental Laws could
not be reasonably expected to have, individually or in the aggregate, a Material
Adverse Effect.  No event or condition has occurred or is occurring with respect
to Holdings or any of its Subsidiaries relating to any Environmental Law, any
Release of Hazardous Materials, or any Hazardous Materials Activity which
individually or in the aggregate has had, or could reasonably be expected to
have, a Material Adverse Effect.

 

4.15.   No Defaults.  Neither Holdings nor any of its Subsidiaries is in default
in the performance, observance or fulfillment of any of the obligations,
covenants or conditions contained in any of its Contractual Obligations, and no
condition exists which, with the giving of notice or the lapse of time or both,
could constitute such a default, except, in each case, where the consequences,
direct or indirect, of such default or defaults, if any, could not reasonably be
expected to have a Material Adverse Effect.

 

4.16.   Material Contracts.  Schedule 4.16 contains a true, correct and complete
list of all the Material Contracts in effect on the Closing Date, and except as
described thereon, all such

 

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Material Contracts are in full force and effect and no defaults exist thereunder
as of the Closing Date.

 

4.17.   Governmental Regulation.  Neither Holdings nor any of its Subsidiaries
is a “registered investment company” or a company “controlled” by a “registered
investment company” or a “principal underwriter” of a “registered investment
company” as such terms are defined in the Investment Company Act of 1940.

 

4.18.   Margin Stock.  Neither Holdings nor any of its Subsidiaries is engaged
principally, or as one of its important activities, in the business of extending
credit for the purpose of purchasing or carrying any Margin Stock.  No part of
the proceeds of the Loans made to any Credit Party will be used to purchase or
carry any such Margin Stock or to extend credit to others for the purpose of
purchasing or carrying any such Margin Stock or for any purpose that violates,
or is inconsistent with, the provisions of Regulation T, U or X of said Board of
Governors.

 

4.19.   Employee Matters.  Neither Holdings nor any of its Subsidiaries is
engaged in any unfair labor practice that could reasonably be expected to have a
Material Adverse Effect.  There is (a) no unfair labor practice complaint
pending against Holdings or any of its Subsidiaries, or to the best knowledge of
Holdings and Borrower, threatened against any of them before the National Labor
Relations Board and no grievance or arbitration proceeding arising out of or
under any collective bargaining agreement that is so pending against Holdings or
any of its Subsidiaries or to the best knowledge of Holdings and Borrower,
threatened against any of them, (b) no strike or work stoppage in existence or
threatened involving Holdings or any of its Subsidiaries, and (c) to the best
knowledge of Holdings and Borrower, no union representation question existing
with respect to the employees of Holdings or any of its Subsidiaries and, to the
best knowledge of Holdings and Borrower, no union organization activity that is
taking place, except (with respect to any matter specified in clause (a), (b) or
(c) above, either individually or in the aggregate) such as is not reasonably
likely to have a Material Adverse Effect.

 

4.20.   Employee Benefit Plans.   Except as could not reasonably be expected to
result in a Material Adverse Effect, Holdings, each of its Subsidiaries and each
of their respective ERISA Affiliates are in compliance with all applicable
provisions and requirements of ERISA and the Internal Revenue Code and the
regulations and published interpretations thereunder with respect to each
Employee Benefit Plan.  Other than with respect to any retirement plans newly
adopted or spun-off as contemplated under the Acquisition Agreement, each
Employee Benefit Plan which is intended to qualify under Section 401(a) of the
Internal Revenue Code has received a favorable determination letter from the
Internal Revenue Service indicating that such Employee Benefit Plan is so
qualified or has a determination letter request pending with the Internal
Revenue Service and nothing has occurred subsequent to the issuance of such
determination letter which would reasonably be expected to cause such Employee
Benefit Plan to lose its qualified status.  No liability (i) to the PBGC (other
than required premium payments) or the Internal Revenue Service, in either case,
with respect to any Employee Benefit Plan, or (ii) to any Employee Benefit Plan
or any trust established under Title IV of ERISA, in any case, has been or is
expected to be incurred by Holdings, any of its Subsidiaries or any of their
ERISA Affiliates, except as could not reasonably be expected to result in a
Material Adverse Effect.  No ERISA Event has occurred or is reasonably expected
to occur that, when taken together with all

 

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other such ERISA Events for which liability is reasonably expected to occur,
could reasonably be expected to result in a Material Adverse Effect.  The
aggregate liability of Holdings and its Subsidiaries with respect to “expected
post-retirement benefit obligations” within the meaning of the Financial
Accounting Standards Board Statement 106 does not exceed $5,000,000.  The
present value of the aggregate benefit liabilities under each Pension Plan
sponsored, maintained or contributed to by Holdings, any of its Subsidiaries or
any of their ERISA Affiliates (determined as of the end of the most recent plan
year on the basis of the actuarial assumptions specified for funding purposes in
the most recent actuarial valuation for such Pension Plan), did not exceed the
aggregate current value of the assets of such Pension Plan by an amount that, if
required to be paid, would reasonably be expected to result in a Material
Adverse Effect.  As of the most recent valuation date for each Multiemployer
Plan for which the actuarial report is available, the potential liability of
Holdings, its Subsidiaries and their respective ERISA Affiliates for a complete
withdrawal from such Multiemployer Plan (within the meaning of Section 4203 of
ERISA), when aggregated with such potential liability for a complete withdrawal
from all Multiemployer Plans, could not reasonably be expected to result in a
Material Adverse Effect. Holdings, each of its Subsidiaries and each of their
ERISA Affiliates have complied in all material respects with the requirements of
Section 515 of ERISA with respect to each Multiemployer Plan and are not in
material “default” (as defined in Section 4219(c)(5) of ERISA) with respect to
payments to a Multiemployer Plan.

 

4.21.   Certain Fees.  As of the Closing Date, no broker’s or finder’s fee or
commission will be payable with respect to the transactions contemplated by the
Related Agreements, except (i) as payable to (a) the Agents and the Lenders and
(b) the agents and lenders party to the First Lien Credit Agreement and related
documents thereto and (ii) as set forth on Schedule 4.21.

 

4.22.   Solvency.  As of the Closing Date, the Credit Parties are Solvent on a
consolidated basis.

 

4.23.   Related Agreements.  Holdings and Borrower have delivered to
Administrative Agent and Syndication Agent complete and correct copies of
(i) each Related Agreement and of all exhibits and schedules thereto as of the
date hereof and (ii) copies of any material amendment, restatement, supplement
or other modification to or waiver of each Related Agreement entered into after
the date hereof.

 

4.24.   Compliance with Statutes, etc.  Each of Holdings and its Subsidiaries is
in compliance with all applicable statutes, regulations, orders, final
judgments, writs, injunctions, decrees and rules of, and all applicable
restrictions imposed by, all Governmental Authorities, in respect of the conduct
of its business and the ownership of its property (including compliance with all
applicable Environmental Laws with respect to any Real Estate Asset or governing
its business and the requirements of any permits issued under such Environmental
Laws with respect to any such Real Estate Asset or the operations of Holdings or
any of its Subsidiaries), except such non-compliance that, individually or in
the aggregate, could not reasonably be expected to result in a Material Adverse
Effect.

 

4.25.   Disclosure.  No representation or warranty of any Credit Party contained
in any Credit Document or in any other documents, certificates or written
statements (other than projections and pro forma financial information contained
in such materials) furnished to any

 

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Agent or Lender by or on behalf of Holdings or any of its Subsidiaries for use
in connection with the transactions contemplated hereby contains any untrue
statement of a material fact or omits to state a material fact (known to
Holdings or Borrower, in the case of any document not furnished by either of
them) necessary in order to make the statements contained herein or therein not
misleading in light of the circumstances in which the same were made.  Any
projections and pro forma financial information contained in such materials are
based upon good faith estimates and assumptions (including estimates from third
party sources) believed by Holdings or Borrower to be reasonable at the time of
preparation, it being recognized by Lenders that such projections as to future
events are not to be viewed as facts, that such projections as to future events
are subject to significant uncertainties and contingencies, many of which are
beyond Holdings’ and its Subsidiaries’ control, that no assurance can be given
that such projections will be realized and that actual results during the period
or periods covered by any such projections may differ from the projected
results.  As of the Closing Date, there are no facts known (or which should upon
the reasonable exercise of diligence be known) to Holdings or Borrower (other
than matters of a general economic nature) that, individually or in the
aggregate, could reasonably be expected to result in a Material Adverse Effect
and that have not been disclosed herein, in the definitive proxy statement
mailed to stockholders of Parent or in such other documents, certificates and
statements furnished to Lenders for use in connection with the transactions
contemplated hereby.

 

4.26.   Patriot Act.  To the extent applicable, each Credit Party is in
compliance, in all material respects, with the (i) Trading with the Enemy Act,
as amended, and each of the foreign assets control regulations of the Untied
States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) and any
other enabling legislation or executive order relating thereto, and (ii) the
Patriot Act.  No part of the proceeds of the Loans will be used, directly or
indirectly, for any payments to any governmental official or employee, political
party, official of a political party, candidate for political office, or anyone
else acting in an official capacity, in order to obtain, retain or direct
business or obtain any improper advantage, in violation of the United States
Foreign Corrupt Practices Act of 1977, as amended.

 

SECTION 5.   AFFIRMATIVE COVENANTS

 

Each Credit Party covenants and agrees that until payment in full of all
Obligations (other than contingent obligations for which no claim has been
made), each Credit Party shall perform, and shall cause each of its Subsidiaries
to perform, all covenants in this Section 5.

 

5.1.   Financial Statements and Other Reports.  Holdings will deliver to
Administrative Agent for the benefit of the Lenders:

 

(a)   Reserved.

 

(b)   Quarterly Financial Statements.  As soon as available, and in any event
within 45 days after the end of each of the first three Fiscal Quarters of each
Fiscal Year (or, during any time that Holdings or Borrower is subject to the
periodic reporting requirements of the Exchange Act, such shorter period as the
Securities and Exchange Commission shall specify for the filing of quarterly
reports on Form 10-Q), commencing with the Fiscal Quarter in which the Closing
Date occurs, the consolidated balance sheets of Holdings and its Subsidiaries as
at

 

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the end of such Fiscal Quarter and the related consolidated statements of income
and cash flows of Holdings and its Subsidiaries for such Fiscal Quarter in the
form required to be prepared if such financial statements were included in a
Form 10-Q and for the period from the beginning of the then current Fiscal Year
to the end of such Fiscal Quarter, setting forth in each case in comparative
form the corresponding figures for the corresponding periods of the previous
Fiscal Year and the corresponding figures from the Financial Plan for the
current Fiscal Year, all in reasonable detail, together with a Financial Officer
Certification and, at any time Parent (x) fails to file its quarterly report on
Form 10-Q with the Securities and Exchange Commission, (y) ceases to be required
to make filings with the Securities and Exchange Commission or (z) acquires any
entity other than a Credit Party or a Subsidiary thereof, a Narrative Report
with respect thereto;

 

(c)   Annual Financial Statements.  As soon as available, and in any event
within 90 days after the end of each Fiscal Year (or, during any time that
Holdings or Borrower is subject to the periodic reporting requirements of the
Exchange Act, such shorter period as the Securities and Exchange Commission
shall specify for the filing of annual reports on Form 10-K), commencing with
the Fiscal Year ended December 31, 2007, (i) the consolidated balance sheets of
Holdings and its Subsidiaries as at the end of such Fiscal Year and the related
consolidated statements of income, stockholders’ equity and cash flows of
Holdings and its Subsidiaries for such Fiscal Year in the form required to be
prepared if such financial statements were included in a Form 10-K, setting
forth in each case in comparative form the corresponding figures for the
previous Fiscal Year and the corresponding figures from the Financial Plan for
the Fiscal Year covered by such financial statements, in reasonable detail,
together with a Financial Officer Certification and, at any time Parent
(x) fails to file its annual report on Form 10-K with the Securities and
Exchange Commission, (y) ceases to be required to make filings with the
Securities and Exchange Commission or (z) acquires any entity other than a
Credit Party or a Subsidiary thereof, a Narrative Report with respect thereto;
and (ii) with respect to such consolidated financial statements a report thereon
of KPMG LLP or other independent certified public accountants of recognized
national standing selected by Holdings, (which report shall be unqualified as to
going concern and scope of audit, and shall state that such consolidated
financial statements fairly present, in all material respects, the consolidated
financial position of Holdings and its Subsidiaries as at the dates indicated
and the results of their operations and their cash flows for the periods
indicated in conformity with GAAP applied on a basis consistent with prior years
(except as otherwise disclosed in such financial statements) and that the
examination by such accountants in connection with such consolidated financial
statements has been made in accordance with generally accepted auditing
standards) together with a written statement by such independent certified
public accountants stating (1) that their audit examination has included a
review of the terms of Section 6.7 of this Agreement and the related definitions
and (2) whether, in connection therewith, any condition or event that
constitutes a Default or an Event of Default under Section 6.7 has come to their
attention and, if such a condition or event has come to their attention,
specifying the nature and period of existence thereof;

 

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

 

(e)   Reserved.

 

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(f)   Notice of Default.  Promptly upon any Authorized Officer of Holdings or
Borrower obtaining knowledge (i) of any occurrence of any Default or any Event
of Default or that notice has been given to Holdings or Borrower with respect
thereto or (ii) of the occurrence of any event or change that has caused or
results in, either in any case or in the aggregate, a Material Adverse Effect, a
certificate of its Authorized Officer specifying the nature and period of
existence of such condition, event or change, or specifying the notice given and
action taken by any such Person and the nature of such claimed Event of Default,
Default, default, event or condition, and what action Borrower has taken, is
taking and proposes to take with respect thereto;

 

(g)   Notice of Litigation.  Promptly upon any Authorized Officer of Holdings or
Borrower obtaining knowledge of (i) the institution of, or non-frivolous written
threat of, any Adverse Proceeding not previously disclosed in writing by
Borrower to Lenders, or (ii) any material development in any Adverse Proceeding
that, in the case of either clause (i) or (ii), could be reasonably expected to
have a Material Adverse Effect, or seeks to impose liability on any of the
Arrangers, Lenders, Holdings and/or Borrower in connection with any indebtedness
of Boise Cascade, L.L.C. that is remaining outstanding after consummation of the
Acquisition, or seeks to enjoin or otherwise prevent the consummation of, or to
recover any damages or obtain relief as a result of, the transactions
contemplated hereby, written notice thereof together with such other information
as may be reasonably available to Holdings or Borrower to enable Lenders and
their counsel to evaluate such matters;

 

(h)   ERISA.  (i) Promptly upon becoming aware of the occurrence of or
forthcoming occurrence of any ERISA Event that could reasonably be expected to
result in a material liability to Holdings or any of its Subsidiaries, a written
notice specifying the nature thereof, what action Holdings, any of its
Subsidiaries or any of their respective ERISA Affiliates has taken, is taking or
proposes to take with respect thereto and, when known, any action taken or
threatened by the Internal Revenue Service, the Department of Labor or the PBGC
with respect thereto; and (ii) with reasonable promptness, upon reasonable
request by the Administrative Agent, copies of (1) each Schedule B (Actuarial
Information) to the annual report (Form 5500 Series) filed by Holdings, any of
its Subsidiaries or any of their respective ERISA Affiliates with the Internal
Revenue Service with respect to each Pension Plan; (2) all notices received by
Holdings, any of its Subsidiaries or any of their respective ERISA Affiliates
from a Multiemployer Plan sponsor concerning an ERISA Event; and (3) copies of
such other documents or governmental reports or filings relating to any Employee
Benefit Plan as Administrative Agent shall reasonably request;

 

(i)   Financial Plan.  As soon as practicable and in any event no later than
forty-five days after the beginning of each Fiscal Year beginning with the
Fiscal year commencing January 1, 2009, a consolidated plan and financial
forecast for such Fiscal Year (a “Financial Plan”), including (i) a forecasted
consolidated balance sheet and forecasted consolidated statements of income and
cash flows of Holdings and its Subsidiaries for each such Fiscal Year, together
with an explanation of the assumptions on which such forecasts are based and
(ii) forecasted consolidated statements of income and cash flows of Holdings and
its Subsidiaries for each quarter of each such Fiscal Year;

 

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(j)   Insurance Certificates.  Together with each delivery of financial
statements of Holdings and its Subsidiaries pursuant to Section 5.1(c), a
certificate from Borrower’s insurance broker(s) in form and substance reasonably
satisfactory to Administrative Agent updating the certificates delivered
pursuant to Section 3.1(k);

 

(k)   Notice Regarding Material Contracts.  Promptly, and in any event within
ten Business Days (i) after any Material Contract of Holdings or any of its
Subsidiaries is terminated or amended in a manner that is materially adverse to
Holdings or such Subsidiary, as the case may be, or (ii) any new Material
Contract is entered into, a written statement describing such event, with copies
of such material amendments or new contracts, delivered to Administrative Agent
(to the extent such delivery is permitted by the terms of any such Material
Contract, provided, no such prohibition on delivery shall be effective if it
were bargained for by Holdings or its applicable Subsidiary with the intent of
avoiding compliance with this Section 5.1(k)), and an explanation of any actions
being taken with respect thereto;

 

(l)   Information Regarding Collateral.  (a)  Borrower will furnish to
Collateral Agent prompt written notice of any change (i) in any Credit Party’s
corporate name, (ii) in any Credit Party’s identity or corporate structure,
(iii) in any Credit Party’s jurisdiction of organization or (iv) in any Credit
Party’s Federal Taxpayer Identification Number or state organizational
identification number (if any).  Borrower agrees not to effect or permit any
change referred to in the preceding sentence unless all filings have been made
(or have been prepared and delivered to the Collateral Agent for filing) under
the Uniform Commercial Code or otherwise that are required in order for
Collateral Agent to continue at all times following such change to have a valid,
legal and perfected security interest in all the Collateral as contemplated in
the Collateral Documents.  Borrower also agrees promptly to notify Collateral
Agent if any material portion of the Collateral is damaged or destroyed;

 

(m)   Annual Collateral Verification.  Each year, at the time of delivery of
annual financial statements with respect to the preceding Fiscal Year pursuant
to Section 5.1(c), Borrower shall deliver to Collateral Agent a certificate of
its Authorized Officer either confirming that there has been no change in such
information since the date of the Collateral Questionnaire delivered on the
Closing Date or the date of the most recent certificate delivered pursuant to
this Section and/or identifying such changes;

 

(n)   Other Information.  (A) Promptly upon their becoming available, copies of
(i) all financial statements, reports, notices and proxy statements sent or made
available generally by Holdings to its security holders acting in such capacity
or by any Subsidiary of Holdings to its security holders other than Holdings or
another Subsidiary of Holdings, (ii) all regular and periodic reports and all
registration statements and prospectuses, if any, filed by Holdings or any of
its Subsidiaries with any securities exchange or with the Securities and
Exchange Commission or any governmental or private regulatory authority,
(iii) all press releases and other statements made available generally by
Holdings or any of its Subsidiaries to the public concerning material
developments in the business of Holdings or any of its Subsidiaries, and
(B) such other information and data with respect to Holdings or any of its
Subsidiaries as from time to time may be reasonably requested by Administrative
Agent or any Lender; and

 

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(o)   Certification of Public Information.  Concurrently with the delivery of
any document or notice required to be delivered pursuant to this Section 5.1,
Holdings shall indicate in writing whether such document or notice contains
Nonpublic Information.  Holdings and each Lender acknowledge that certain of the
Lenders may be “public-side” Lenders (Lenders that do not wish to receive
material non-public information with respect to Holdings, its Subsidiaries or
their securities) and, if documents or notices required to be delivered pursuant
to this Section 5.1 or otherwise are being distributed through
IntraLinks/IntraAgency, SyndTrak or another relevant website or other
information platform (the “Platform”), any document or notice that Holdings has
indicated contains Nonpublic Information shall not be posted on that portion of
the Platform designated for such public-side Lenders.  If Holdings has not
indicated whether a document or notice delivered pursuant to this Section 5.1
contains Nonpublic Information, Administrative Agent shall deem such information
to be Nonpublic Information until confirmed otherwise by Holdings (such
confirmation not to be unreasonably withheld or delayed) and shall not post such
document or notice on that portion of the Platform designated for Lenders who do
not wish to receive material nonpublic information with respect to Holdings, its
Subsidiaries and their Securities.

 

5.2.   Existence.  Except as otherwise permitted under Section 6.8, each Credit
Party will, and will cause each of its Subsidiaries to, at all times preserve,
renew and keep in full force and effect its (i) existence and (ii) all rights
and franchises, licenses and permits, and Intellectual Property material to the
conduct of its business, except in the case of clause (ii) to the extent that
failure to do so could not reasonably be expected to have a Material Adverse
Effect.

 

5.3.   Payment of Taxes and Claims.  Each Credit Party will, and will cause each
of its Subsidiaries to, pay all Taxes imposed upon it or any of its properties
or assets or in respect of any of its income, businesses or franchises before
any penalty or fine accrues thereon, and all claims (including claims for labor,
services, materials and supplies) for sums that have become due and payable and
that by law have or may become a Lien upon any of its properties or assets,
prior to the time when any penalty or fine shall be incurred with respect
thereto; provided, no such Tax or claim need be paid if it is being contested in
good faith by appropriate proceedings promptly instituted and diligently
conducted, so long as (a) adequate reserve or other appropriate provision, as
shall be required in conformity with GAAP shall have been made therefor, and
(b) in the case of a Tax or claim which has or may become a Lien against any of
the Collateral, such contest proceedings conclusively operate to stay the sale
of any portion of the Collateral to satisfy such Tax or claim.

 

5.4.   Maintenance of Properties.  Each Credit Party will, and will cause each
of its Subsidiaries to, maintain or cause to be maintained in good repair,
working order and condition, ordinary wear and tear excepted and subject to
casualty and condemnation events (in which case such property shall be repaired
or replaced as promptly as practicable), all material tangible properties used
or useful in the business of Holdings and its Subsidiaries.

 

5.5.   Insurance.  Holdings will maintain or cause to be maintained, with
financially sound and reputable insurers, such public liability insurance, third
party property damage insurance, business interruption insurance and casualty
insurance with respect to liabilities, losses or damage in respect of the
assets, properties and businesses of Holdings and its Subsidiaries as may
customarily be carried or maintained under similar circumstances by Persons

 

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of established reputation engaged in similar businesses, in each case in such
amounts (giving effect to self-insurance), with such deductibles, covering such
risks and otherwise on such terms and conditions as shall be customary for such
Persons.  Without limiting the generality of the foregoing, Holdings will
maintain or cause to be maintained (a) flood insurance with respect to each
Flood Hazard Property that is located in a community that participates in the
National Flood Insurance Program, in each case in compliance with any applicable
regulations of the Board of Governors of the Federal Reserve System, and
(b) replacement value casualty insurance on the Collateral under such policies
of insurance, with such insurance companies, in such amounts, with such
deductibles, and covering such risks as are at all times carried or maintained
under similar circumstances by Persons of established reputation engaged in
similar businesses.  Each such policy of insurance shall (i) in the case of each
public liability insurance policy and, if available from the relevant insurance
carrier, each casualty insurance policy, name Collateral Agent, on behalf of
Secured Parties, as an additional insured thereunder as its interests may
appear, (ii) in the case of each casualty insurance policy, contain a loss
payable clause or endorsement, reasonably satisfactory in form and substance to
Collateral Agent, that names Collateral Agent, on behalf of the Secured Parties,
as the loss payee thereunder and provides that insurer shall endeavor to give at
least thirty days’ (10 days’ in the case of non-payment of premium) prior
written notice to Collateral Agent of any modification or cancellation of such
policy.  Notwithstanding anything to the contrary set forth in this Section, so
long as no Default or Event of Default shall have occurred and be continuing,
upon notice from Borrower that it or one or more of its Subsidiaries shall
exercise the reinvestment option described in Section 2.14(b), the Collateral
Agent shall promptly turn over to Borrower any insurance proceeds received
pursuant to this Section.

 

5.6.   Books and Records; Inspections.  Each Credit Party will, and will cause
each of its Subsidiaries to, keep proper books of record and accounts in which
full, true and correct entries in conformity in all material respects with GAAP
shall be made of all dealings and transactions in relation to its business and
activities.  Each Credit Party will, and will cause each of its Subsidiaries to,
permit any authorized representatives designated by any Lender to visit and
inspect any of the properties of any Credit Party and any of its respective
Subsidiaries, to inspect, copy and take extracts from its and their financial
and accounting records, and to discuss its and their affairs, finances and
accounts with its and their officers and (so long as a representative of
Holdings or Borrower has been afforded a reasonable opportunity to be present at
such discussions) independent public accountants, all upon reasonable notice and
at such reasonable times during normal business hours and as often as may
reasonably be requested; provided that, unless a Default has occurred and is
continuing, Borrower shall not be required to pay the expense of any such visit
by a representative of a Lender, and shall only be required to pay the expense
of two such visits by a representative of Administrative Agent during any Fiscal
Year.

 

5.7.   Lenders Meetings.  Holdings and Borrower will, upon the reasonable
request of Administrative Agent or Requisite Lenders, participate in a meeting
of Administrative Agent and Lenders once during each Fiscal Year to be held at
Borrower’s corporate offices (or at such other location as may be agreed to by
Borrower and Administrative Agent) at such time as may be agreed to by Borrower
and Administrative Agent.

 

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5.8.   Compliance with Laws.  Each Credit Party will comply, and shall cause
each of its Subsidiaries to comply, with the requirements of all applicable
laws, rules, regulations and orders of any Governmental Authority (including all
Environmental Laws), noncompliance with which could reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect.

 

5.9.   Environmental.

 

(a)   Environmental Disclosure.  Holdings will deliver to Administrative Agent
and Lenders:

 

(i)   as soon as practicable following receipt thereof, copies of all
environmental audits, investigations, analyses and reports of any kind or
character, whether prepared by personnel of Holdings or any of its Subsidiaries
or by independent consultants, governmental authorities or any other Persons,
with respect to environmental matters at any Facility or with respect to any
Environmental Claims that could reasonably be expected to result in Holdings or
any of its Subsidiaries incurring liability or expenses in excess of $5,000,000;

 

(ii)   promptly upon the occurrence thereof, written notice describing in
reasonable detail (1) any Release required to be reported to any federal, state
or local governmental or regulatory agency under any applicable Environmental
Laws that could reasonably be expected to give rise to Environmental Claims
resulting in Holdings or any of its Subsidiaries incurring liability or expenses
in excess of $5,000,000, (2) any remedial action taken by Holdings or any other
Person in response to (A) any Hazardous Materials Activities the existence of
which has a reasonable possibility of resulting in one or more Environmental
Claims that could reasonably be expected to result in Holdings or any of its
Subsidiaries incurring liability or expenses in excess of $5,000,000, or (B) any
Environmental Claims that could reasonably be expected to result in Holdings or
any of its Subsidiaries incurring liability or expenses in excess of $5,000,000,
and (3) Holdings’ or Borrower’s discovery of any occurrence or condition on any
real property adjoining or in the vicinity of any Real Estate Asset that could
cause such Real Estate Asset or any part thereof to be subject to any material
restrictions on the ownership, occupancy, transferability or use thereof under
any Environmental Laws;

 

(iii)   as soon as practicable following the sending or receipt thereof by
Holdings or any of its Subsidiaries, a copy of any and all written
communications with respect to (1) any Environmental Claims that could
reasonably be expected to result in Holdings or any of its Subsidiaries
incurring liability or expenses in excess of $5,000,000, (2) any Release
required to be reported to any federal, state or local governmental or
regulatory agency that could reasonably be expected to give rise to
Environmental Claims resulting in Holdings or any of its Subsidiaries incurring
liability or expenses in excess of $5,000,000, and (3) any request for
information from any governmental agency that suggests such agency is
investigating whether Holdings or any of its Subsidiaries may be potentially
responsible for any Hazardous Materials Activity that could reasonably be
expected to give rise to Environmental Claims resulting in

 

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Holdings or any of its Subsidiaries incurring liability or expenses in excess of
$5,000,000;

 

(iv)   prompt written notice describing in reasonable detail (1) any proposed
acquisition of stock, assets, or property by Holdings or any of its Subsidiaries
that could reasonably be expected to (A) expose Holdings or any of its
Subsidiaries to, or result in, Environmental Claims that could reasonably be
expected to result in Holdings or any of its Subsidiaries incurring liability or
expenses in excess of $5,000,000 or (B) affect the ability of Holdings or any of
its Subsidiaries to maintain in full force and effect all material Governmental
Authorizations required under any Environmental Laws for their respective
operations and (2) any proposed action to be taken by Holdings or any of its
Subsidiaries to modify current operations in a manner that could reasonably be
expected to subject Holdings or any of its Subsidiaries to any additional
material obligations or requirements under any Environmental Laws that could
reasonably be expected to result in Holdings or any of its Subsidiaries
incurring liability or expenses in excess of $5,000,000; and

 

(v)   with reasonable promptness, such other documents and information as from
time to time may be reasonably requested by Administrative Agent in relation to
any matters disclosed pursuant to this Section 5.9(a).

 

(b)   Hazardous Materials Activities, Etc.  Each Credit Party shall promptly
take, and shall cause each of its Subsidiaries promptly to take, any and all
actions necessary to (i) cure any violation of applicable Environmental Laws by
such Credit Party or its Subsidiaries that could reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect, and (ii) make an
appropriate response to any Environmental Claim against such Credit Party or any
of its Subsidiaries and discharge any obligations it may have to any Person
thereunder where failure to do so could reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect.

 

5.10.   Subsidiaries.  In the event that any Person becomes a Domestic
Subsidiary of Borrower, Borrower shall (a) promptly cause such Domestic
Subsidiary to become a Guarantor hereunder and a Grantor under the Pledge and
Security Agreement by executing and delivering to Administrative Agent and
Collateral Agent a Counterpart Agreement, and (b) take all such actions and
execute and deliver, or cause to be executed and delivered, all such documents,
instruments, agreements, and certificates as are similar to those described in
Sections 3.1(b), 3.1(h), 3.1(i), and if reasonably required by the
Administrative Agent, 3.1(l).  In the event that any Person becomes a first-tier
Foreign Subsidiary of Borrower, and the ownership interests of such Foreign
Subsidiary are owned by Borrower or by any Domestic Subsidiary thereof, Borrower
shall, or shall cause such Domestic Subsidiary to, deliver, all such documents,
instruments, agreements, and certificates as are similar to those described in
Section 3.1(b)(i), and Borrower shall take, or shall cause such Domestic
Subsidiary to take, all of the actions referred to in
Section 3.1(i)(i) necessary to grant and to perfect a Second Priority Lien in
favor of Collateral Agent, for the benefit of Secured Parties, in 65% of such
ownership interests under the Pledge and Security Agreement and any local law
pledge agreements reasonably required by Collateral Agent.  With respect to each
such Subsidiary, Borrower shall promptly send to Administrative Agent written
notice setting forth with respect to such Person (i) the date on

 

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which such Person became a Subsidiary of Borrower, and (ii) all of the data
required to be set forth in Schedules 4.1 and 4.2 with respect to all
Subsidiaries of Borrower; and such written notice shall be deemed to supplement
Schedule 4.1 and 4.2 for all purposes hereof.

 

5.11.   Additional Material Real Estate Assets.  In the event that any Credit
Party acquires a Material Real Estate Asset or the Credit Parties have knowledge
(it being understood that Borrower shall internally evaluate the value of Real
Estate Assets on an annual basis) that a Real Estate Asset owned or leased on
the Closing Date has become a Material Real Estate Asset and such interest has
not otherwise been made subject to the Lien of the Collateral Documents in favor
of Collateral Agent, for the benefit of Secured Parties, then such Credit Party
shall promptly take all such actions and execute and deliver, or cause to be
executed and delivered, all such mortgages, documents, instruments, agreements,
opinions and certificates similar to those described in Sections 3.1(h) and
3.1(i), together with environmental reports, with respect to each such Material
Real Estate Asset that Collateral Agent shall reasonably request to create in
favor of Collateral Agent, for the benefit of Secured Parties, a valid and,
subject to any filing and/or recording referred to herein, perfected Second
Priority security interest in such Material Real Estate Assets.  In addition to
the foregoing, Borrower shall, at the reasonable request of Collateral Agent,
deliver, from time to time, to Collateral Agent such appraisals as are required
by law or regulation of Real Estate Assets with respect to which Collateral
Agent has been granted a Lien.

 

5.12.   Reserved.

 

5.13.   Further Assurances.  At any time or from time to time upon the request
of Administrative Agent, each Credit Party will, at its expense, promptly
(i) execute, acknowledge and deliver and thereafter register, file or record in
an appropriate governmental office such further documents and do such other acts
and things as Administrative Agent or Collateral Agent deems reasonably
necessary or desirable for the continued validity, perfection and priority of
the Liens on Collateral covered thereby superior to and prior to the rights of
all third Persons other than the holders of Permitted Liens and subject to no
other liens except as permitted by the applicable Collateral Document,
(ii) deliver to the Administrative Agent and the Collateral Agent such other
documentation, consents, authorizations, approvals and orders in form and
substance reasonably satisfactory to the Administrative Agent and the Collateral
Agent as the Administrative Agent and the Collateral Agent shall reasonably deem
necessary to perfect or maintain the Liens on the Collateral pursuant to the
Collateral Documents, and (iii) upon the exercise by the Administrative Agent,
the Collateral Agent or the Lenders of any power, right, privilege or remedy
pursuant to any Credit Document which requires any consent, approval,
registration, qualification or authorization of any Governmental Authority,
execute and deliver all applications, certifications, instruments and other
documents and papers that the Administrative Agent, Collateral Agent or the
Lenders may be so required to obtain.  In furtherance and not in limitation of
the foregoing, each Credit Party shall take such actions as Administrative Agent
or Collateral Agent may reasonably request from time to time to ensure that the
Obligations are guarantied by the Guarantors and are secured by substantially
all of the assets of Holdings, and its Subsidiaries and all of the outstanding
Equity Interests of Borrower and its Subsidiaries (subject to limitations
contained in the Credit Documents).

 

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5.14.   Miscellaneous Covenants.  Unless otherwise consented to by Requisite
Lenders:

 

(a)           Maintenance of Ratings.  At all times, Borrower shall use
commercially reasonable efforts to maintain ratings (but not specific ratings
levels) issued by Moody’s and S&P with respect to itself and its senior secured
debt.

 

(b)           Cash Management Systems.  Holdings and its Subsidiaries shall
establish and maintain cash management systems reasonably acceptable to
Administrative Agent.

 

SECTION 6.   NEGATIVE COVENANTS

 

Each Credit Party covenants and agrees that until payment in full of all
Obligations (other than contingent obligations for which no claim has been
made), such Credit Party shall perform, and shall cause each of its Subsidiaries
to perform, all covenants in this Section 6.

 

6.1.   Indebtedness.  No Credit Party shall, nor shall it permit any of its
Subsidiaries to, directly or indirectly, create, incur, assume or guaranty, or
otherwise become or remain directly or indirectly liable with respect to any
Indebtedness, except:

 

(a)   the Obligations;

 

(b)   Indebtedness of any Subsidiary to Borrower or to any other Subsidiary, or
of Borrower to any Subsidiary; provided, (i) all such Indebtedness owed to any
Credit Party shall be evidenced by the Intercompany Note, which shall be subject
to a Second Priority Lien pursuant to the Pledge and Security Agreement,
(ii) all such Indebtedness shall be unsecured and, in the case of Indebtedness
owed to any Credit Party, subordinated in right of payment to the payment in
full of the Obligations (other than contingent obligations for which no claim
has been made) pursuant to the terms of the Intercompany Note, (iii) any payment
by any Guarantor Subsidiary under any guaranty of the Obligations shall result
in a pro tanto reduction of the amount of any Indebtedness owed by such
Guarantor Subsidiary to Borrower or to any of its Subsidiaries for whose benefit
such payment is made and (iv) Indebtedness of any Subsidiary that is not a
Credit Party to Borrower or any Guarantor Subsidiary shall be subject to
Section 6.6(m);

 

(c)   (i) Indebtedness and other Obligations (other than with respect to Hedge
Agreements and Treasury Services Agreements) under and as defined in the First
Lien Credit Agreement and related documents in an aggregate principal amount not
to exceed $1,072,500,000 and (ii) Indebtedness of Borrower and/or any of its
Subsidiaries under Hedge Agreements and Treasury Services Agreements;

 

(d)   Indebtedness incurred by Borrower or any of its Subsidiaries arising from
agreements providing for indemnification, adjustment of purchase price or
similar obligations (including, Indebtedness consisting of the deferred purchase
price of property acquired in a Permitted Acquisition and earn-out obligations
incurred in connection with any Permitted Acquisition), or from guaranties or
letters of credit, surety bonds or performance bonds securing the performance of
Borrower or any such Subsidiary pursuant to such agreements, in connection with
the Acquisition, Permitted Acquisitions or permitted dispositions of any
business, assets or Subsidiary of Holdings or any of its Subsidiaries;

 

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

 

(f)   Indebtedness of Borrower or any of its Subsidiaries in respect of netting
services, overdraft protections and otherwise in connection with deposit
accounts;

 

(g)   guaranties by Holdings or any of its Subsidiaries in the ordinary course
of business of the obligations of suppliers, customers, franchisees and
licensees of Borrower and its Subsidiaries;

 

(h)   guaranties by Borrower of Indebtedness of a Subsidiary or guaranties by a
Subsidiary of Indebtedness of Borrower or another Subsidiary with respect, in
each case, to Indebtedness otherwise permitted to be incurred pursuant to this
Section 6.1; provided, that (i) if the Indebtedness that is being guarantied is
unsecured and/or subordinated to the Obligations, the guaranty shall also be
unsecured and/or subordinated to the Obligations and (ii) guaranties by any
Credit Party of Indebtedness of any Subsidiary that is not a Credit Party shall
be subject to Section 6.6(m);

 

(i)   Indebtedness described in Schedule 6.1 (including Indebtedness required to
be assumed or incurred pursuant to the Acquisition Agreement), but not any
extensions, renewals or replacements of such Indebtedness except (i) renewals
and extensions expressly provided for in the agreements evidencing any such
Indebtedness as the same are in effect on the date of this Agreement and
(ii) refinancings and extensions of any such Indebtedness if the terms and
conditions thereof are not less favorable to the obligor thereon or to the
Lenders than the Indebtedness being refinanced or extended, and the average life
to maturity thereof is greater than or equal to that of the Indebtedness being
refinanced or extended; provided, such Indebtedness permitted under the
immediately preceding clause (i) or (ii) above shall not (A) include
Indebtedness of an obligor that was not an obligor with respect to the
Indebtedness being extended, renewed or refinanced, (B) exceed in a principal
amount the Indebtedness being renewed, extended or refinanced or (C) be
incurred, created or assumed if any Default or Event of Default has occurred and
is continuing or would result therefrom;

(j)   Indebtedness of Borrower or any of its Subsidiaries with respect to
Capital Leases and purchase money Indebtedness in an aggregate amount not to
exceed at any time $57,500,000; provided, any such purchase money Indebtedness
shall be secured only by the asset acquired in connection with the incurrence of
such Indebtedness;

 

(k)   (i) Indebtedness of a Person or Indebtedness attaching to assets of a
Person that, in either case, becomes a Subsidiary or Indebtedness attaching to
assets that are acquired by Borrower or any of its Subsidiaries, in each case
after the Closing Date as the result of a Permitted Acquisition, in an aggregate
amount not to exceed $57,500,000 at any one time outstanding; provided that such
Indebtedness existed at the time such Person became a Subsidiary or at the time
such assets were acquired and, in each case, was not created in anticipation
thereof, and (ii) any refinancing, refunding, renewal or extension of any
Indebtedness specified in subclause (i) above; provided, that (1) the principal
amount of any such Indebtedness is not increased above the principal amount
thereof outstanding immediately prior

 

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to such refinancing, refunding, renewal or extension and (2) such Indebtedness
shall not be secured by any assets other than the assets securing the
Indebtedness being renewed, extended or refinanced; and

 

(l)   senior unsecured Indebtedness of Borrower or any Subsidiary in an
aggregate amount not to exceed $57,500,000 at any one time outstanding; provided
that (A) such Indebtedness is in respect of promissory notes or other debt
securities issued as consideration for a Permitted Acquisition or is in respect
of borrowed money, the proceeds of which are promptly applied as consideration
for a Permitted Acquisition or to the satisfaction of any obligation permitted
under Section 6.1(d), (B) no Default shall have occurred and be continuing at
the time of and after giving effect to the incurrence of such Indebtedness, and
(C) prior to the incurrence of such Indebtedness Borrower shall have delivered
to Administrative Agent a certificate of an Authorized Officer describing the
Indebtedness to be incurred (and attaching true and correct copies of the
documentation therefor) and the relevant Permitted Acquisition and certifying
satisfaction of the requirements set forth in clauses (A) and (B);

 

(m)   Indebtedness in an aggregate principal amount not to exceed $115,000,000
that is (i) subordinated to the Obligations on terms customary at the time for
high-yield subordinated debt securities issued in a public offering,
(ii) matures after, and does not require any scheduled amortization or other
scheduled payments of principal prior to, the Maturity Date (it being understood
that such Indebtedness may have mandatory prepayment, repurchase or redemptions
provisions satisfying the requirement of clause (iii) hereof), (iii) has terms
and conditions (other than interest rate, redemption premiums and subordination
terms), taken as a whole, that are not materially less favorable to Borrower as
the terms and conditions customary at the time for high-yield subordinated debt
securities issued in a public offering and (iv) is incurred by Borrower or a
Guarantor (other than Holdings); provided that (1) both immediately prior to and
after giving effect to the incurrence thereof, (x) no Default shall exist or
result therefrom and (y) Holdings will be in compliance with the covenants set
forth in Section 6.7 and provided further that a certificate of an Authorized
Officer delivered to Administrative Agent at least ten days prior to the
incurrence of such Indebtedness, together with a reasonably detailed description
of the material terms and conditions of such Indebtedness or drafts of the
documentation relating thereto, stating that Holdings has determined in good
faith that such terms and conditions satisfy the requirements of this clause
(m) shall be conclusive evidence that such terms and conditions satisfy the
foregoing requirement unless Administrative Agent notifies Holdings within five
days of receipt of such certificate that it disagrees with such determination;

 

(n)   the guarantee obligations under the subordinated guaranty made in favor of
Boise Cascade, L.L.C. to be entered into in connection with the issuance of the
subordinated promissory note issued to Boise Cascade, L.L.C. as payment of a
portion of the consideration for the Acquisition, which subordinated guaranty
shall be in form and substance reasonably satisfactory to Administrative Agent;

 

(o)   obligations of Borrower or any of its Subsidiaries under any Interest Rate
Agreement, Currency Agreement or Commodity Agreement; provided, that such
obligations shall be unsecured to the extent such obligations are made in favor
of any Person other than a Lender Counterparty (as defined in the First Lien
Credit Agreement);

 

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(p)   Indebtedness of Borrower or any of its Subsidiaries incurred in the
ordinary course of business in connection with the financing of insurance
premiums;

 

(q)   commercial letter of credit facilities in an aggregate amount not to
exceed $115,000 at any time outstanding; and

 

(r)   other unsecured Indebtedness of Borrower and its Subsidiaries (including
Indebtedness of Foreign Subsidiaries) in an aggregate amount not to exceed at
any time $28,750,000.

 

6.2.   Liens.  No Credit Party shall, nor shall it permit any of its
Subsidiaries to, directly or indirectly, create, incur, assume or permit to
exist any Lien on or with respect to any property or asset of any kind
(including any document or instrument in respect of goods or accounts
receivable) of Holdings or any of its Subsidiaries, whether now owned or
hereafter acquired or any income, profits or royalties therefrom, except:

 

(a)   Liens in favor of Collateral Agent for the benefit of Secured Parties
granted pursuant to any Credit Document;

 

(b)   Liens for Taxes which are not yet due and payable or which are being
contested in compliance with Section 5.3;

 

(c)   statutory Liens of landlords, carriers, warehousemen, mechanics,
repairmen, workmen and materialmen, and other Liens imposed by law (other than
any such Lien imposed pursuant to Section 430(k) of the Internal Revenue Code or
by ERISA or a violation of Section 436 of the Internal Revenue Code), in each
case incurred in the ordinary course of business (i) for amounts not yet overdue
for more than thirty (30) days or (ii) for amounts that are overdue for a period
in excess of thirty (30) days that are being contested in good faith by
appropriate proceedings, so long as such reserves or other appropriate
provisions, if any, as shall be required by GAAP shall have been made for any
such contested amounts;

 

(d)   Liens incurred in the ordinary course of business in connection with
workers’ compensation, unemployment insurance and other types of social
security, or to secure the performance of tenders, statutory obligations, surety
and appeal bonds, bids, leases, government contracts, trade contracts,
performance and return-of-money bonds and other similar obligations (exclusive
of obligations for the payment of borrowed money or other Indebtedness), so long
as no foreclosure, sale or similar proceedings have been commenced with respect
to any portion of the Collateral on account thereof;

 

(e)   easements, rights-of-way, restrictions, encroachments, and similar
encumbrances and other minor defects or irregularities in title, in each case
which do not and will not interfere in any material respect with the ordinary
conduct of the business of Borrower or any Subsidiary;

 

(f)   any interest or title of a lessor or sublessor under any lease of real
estate permitted hereunder;

 

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

 

(h)   purported Liens evidenced by the filing of precautionary UCC financing
statements relating solely to operating leases of personal property or
consignments or similar arrangements entered into in the ordinary course of
business;

 

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

 

(j)   any zoning or similar law or right reserved to or vested in any
governmental office or agency to control or regulate the use of any real
property;

 

(k)   (i) licenses of Intellectual Property granted by Holdings or any of its
Subsidiaries in the ordinary course of business or not interfering in any
respect with the ordinary conduct of, or not materially detracting from the
value of, the business of Borrower or such Subsidiary and (ii) Exclusive IP
Licenses to the extent permitted under Section 6.8;

 

(l)   Liens described in Schedule 6.2 or on a title report delivered pursuant to
Section 3.1(h)(iv) and any modifications, replacements, renewals or extensions
thereof; provided that any such modification, replacement, renewal or extension
of such Liens shall (x) encumber only those assets which were encumbered by the
original Lien and (y) only secure Indebtedness permitted by Section 6.1;

 

(m)   Liens on collateral securing obligations under the First Lien Credit
Agreement, the other Credit Documents (as defined in the First Lien Credit
Agreement), Hedge Agreements and Treasury Services Agreements;

 

(n)   Liens securing Indebtedness permitted pursuant to Section 6.1(j);
provided, any such Lien shall encumber only the asset acquired with the proceeds
of such Indebtedness;

 

(o)   Liens securing Indebtedness permitted pursuant to Section 6.1(k); provided
that (A) such Lien is not created in contemplation of or in connection with such
acquisition or such Person becoming a Subsidiary, as the case may be, (B) such
Lien shall not apply to any other property or assets of Borrower or any
Subsidiary and (C) such Lien shall secure only those obligations which it
secured on the date of such acquisition or the date such Person becomes a
Subsidiary, as the case may be, and extensions, renewals and refinancings
thereof permitted under Section 6.1(l)(ii);

 

(p)   Liens on insurance policies and the proceeds thereof securing the
financing of the premiums with respect thereto;

 

(q)   obligations with respect to repurchase agreements of the type described in
clause (vi) of the definition of Cash Equivalents;

 

(r)   Liens arising from judgments, decrees or attachments (or securing of
appeal bonds with respect thereto) in circumstances not constituting an Event of
Default;

 

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(s)   Liens arising solely under Article 4 of the UCC relating to collection on
items in connection and documents and proceeds related thereto;

 

(t)   statutory rights and other customary rights of set-off, revocation, refund
or chargeback under deposit agreements or under the UCC of banks or other
financial institutions where Borrower or any Subsidiary maintains deposits
(other than deposits intended as cash collateral) in the ordinary course of
business;

 

(u)   Liens on the goods and assets being shipped in reliance on commercial
letters of credit issued under commercial letter of credit facilities permitted
under Section 6.1(q); and

 

(v)   other Liens securing Indebtedness in an aggregate amount not to exceed
$17,250,000 at any time outstanding.

 

6.3.   No Further Negative Pledges.  Except with respect to (a) specific
property encumbered to secure payment of particular Indebtedness or to be sold
pursuant to an executed agreement with respect to a permitted Asset Sale,
(b) restrictions contained in the Credit Documents and the First Lien Credit
Agreement or any related documents, (c) customary provisions restricting
assignments, subletting or other transfers contained in leases, licenses, joint
venture agreements, sales and procurement contracts and similar agreements
entered into in the ordinary course of business (provided that such restrictions
are limited to the property or assets secured by such Liens or the property or
assets subject to such leases, licenses, joint venture agreements or similar
agreements, as the case may be) or in connection with sale and lease-back
transactions permitted under Section 6.10, (d) restrictions and conditions
imposed by law, (e) restrictions in Contractual Obligations identified on
Schedule 6.3, (f) restrictions or conditions imposed by any agreement relating
to Indebtedness permitted by this Agreement secured by Liens permitted by this
Agreement if such restrictions or conditions apply only to the Person obligated
under such Indebtedness and its Subsidiaries or the property or assets intended
to secure such Indebtedness, (g) Contractual Obligations binding on a Subsidiary
acquired by any Credit Party in a Permitted Acquisition at the time such
Subsidiary first becomes a Subsidiary, so long as such contractual obligations
were not entered into solely in contemplation of such Person becoming a
Subsidiary, (h) restrictions on cash deposits imposed by vendors under contracts
entered into in the ordinary course of business, (i) restrictions on cash
deposits made by customers in the ordinary course of business that are subject
to return to such customers and (j) any restrictions imposed by any amendments,
modifications, restatements, renewals, increases, supplements, refundings,
replacements or refinancings of the Contractual Obligations or Indebtedness
referred to in clauses (a) through (i) above; provided that, such amendments,
modifications, restatements, renewals, increases, supplements, refundings,
replacements or refinancings are, in the good faith judgment of Borrower, no
more restrictive with respect to such encumbrance and other restrictions taken
as a whole than those prior to such amendment, modification, restatement,
renewal, increase, supplement, refunding, replacement or refinancing, no Credit
Party nor any of its Subsidiaries shall enter into any agreement prohibiting the
creation or assumption of any Lien in favor of the Lenders upon any of its
properties or assets, whether now owned or hereafter acquired, to secure the
Obligations.

 

6.4.   Restricted Junior Payments.  No Credit Party shall, nor shall it permit
any of its Subsidiaries or Affiliates through any manner or means or through any
other Person to, directly

 

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or indirectly, declare, order, pay, make or set apart, or agree to declare,
order, pay, make or set apart, any sum for any Restricted Junior Payment except
that:

 

(a) Intentionally Omitted;

 

(b) Borrower or any of its Subsidiaries may make Restricted Junior Payments to
Holdings, the proceeds of which will be used by Holdings for distributions to
Parent to (i) pay franchise taxes and other fees, taxes and expenses required to
maintain Parent’s corporate existence and (ii) permit Parent to discharge its
income tax liability, if any, associated solely with the consolidated taxable
income of Holdings and its Subsidiaries which Parent must take into account in
calculating its own income tax liability; provided that any such amounts
received from Borrower or Holdings shall be paid over to the appropriate taxing
authority within 60 days of the direct or indirect parent’s receipt of such
amounts or refunded to Borrower or Holdings, as the case may be,

 

(c) Borrower or any of its Subsidiaries may make Restricted Junior Payments to
Holdings, the proceeds of which will be used by Holdings for distributions to
Parent to pay (i) general corporate operating and overhead costs and expenses of
Parent to the extent such costs and expenses are reasonably attributable to the
ownership or operation of Holdings and its Subsidiaries, (ii) reasonable and
customary salary, bonus and other benefits payable to officers and employees of
Parent to the extent such salaries, bonuses and other benefits are reasonably
attributable to the ownership or operation of Holdings and its Subsidiaries and
(iii) fees and expenses (other than to Affiliates of Holdings) related to any
secondary equity or debt offering or any unsuccessful primary equity or debt
offering of Parent to the extent the offering memorandum with respect to such
equity or debt offering provided that the proceeds of such equity or debt
offering were to be contributed to Holdings or its Subsidiaries, in an aggregate
amount with respect to this clause (c) not exceeding an amount during any Fiscal
Year equal to the sum of (A) $5,750,000 and (B) the amount of any net cash
proceeds received from the issuance of Equity Interests by, or capital
contributions made to, Holdings after the Closing Date and not used to make a
Specified Investment within 90 days following receipt thereof (plus any such
amount permitted without giving effect to this parenthetical in the immediately
preceding Fiscal Year but not so utilized);

 

(d) Borrower or any of its Subsidiaries may make Restricted Junior Payments to
Holdings, the proceeds of which will be used by Holdings for distributions to
Parent (i) to pay reasonable and customary fees payable to any directors of
Parent and reimbursement of reasonable out-of-pocket costs of the directors of
Parent in the ordinary course of business, to the extent reasonably attributable
to the ownership or operation of Holdings and its Subsidiaries, (ii) to pay
reasonable and customary indemnities to directors, officers and employees of
Parent in the ordinary course of business, to the extent reasonably attributable
to the ownership or operation of Holdings and its Subsidiaries, (iii) to pay
cash payments in lieu of issuing fractional shares in connection with the
exercise of warrants, options or other securities convertible into or
exchangeable for Equity Interests of Parent in an aggregate amount not exceeding
$57,500 during any Fiscal Year, (iv) to pay amounts due in accordance with the
Acquisition Agreement, and (v) to the extent necessary to permit Parent to
discharge its other permitted liabilities in an aggregate amount not to exceed
$1,725,000 so long as Parent applies the amount of any such Restricted Junior
Payment for such purpose;

 

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(e) Borrower and its Subsidiaries may make Restricted Junior Payments to
Holdings, the proceeds of which will be used by Holdings for distributions to
Parent, pursuant to and in accordance with stock option plans or other benefit
plans for management or employees of Borrower and its Subsidiaries and to fund
any repurchase or redemption by Parent of its Equity Interests from former
members of management, former employees, former consultants, or former directors
of the Credit Parties or their respective estates, spouses, former spouses,
family members or other permitted transferees; provided that the aggregate
amount applied for all such purposes shall not exceed $17,250,000 during any
Fiscal Year;

 

(f) Borrower or any of its Subsidiaries may make Restricted Junior Payments to
Holdings to pay reasonable and customary salary, bonus and other benefits
payable to officers and employees of Holdings,

 

(g) any Credit Party may refinance Indebtedness to the extent permitted by
Section 6.1;

 

(h) so long as no Event of Default has occurred and is continuing, any Credit
Party may make payments in respect of intercompany Indebtedness; and

 

(i) Holdings or any of its Subsidiaries may make Restricted Junior Payments
consisting of the repurchase of Equity Interests deemed to occur upon any
“cashless” exercise of stock options, warrants or other convertible securities.

 

6.5.   Restrictions on Subsidiary Distributions.  Except as provided herein, no
Credit Party shall, nor shall it permit any of its Subsidiaries to, create or
otherwise cause or suffer to exist or become effective any consensual
encumbrance or restriction of any kind on the ability of any Subsidiary of
Borrower to (a) pay dividends or make any other distributions on any of such
Subsidiary’s Equity Interests owned by Borrower or any other Subsidiary of
Borrower, (b) repay or prepay any Indebtedness owed by such Subsidiary to
Borrower or any other Subsidiary of Borrower, (c) make loans or advances to
Borrower or any other Subsidiary of Borrower, or (d) transfer, lease or license
any of its property or assets to Borrower or any other Subsidiary of Borrower
other than restrictions (i) existing under the Credit Documents and the First
Lien Credit Agreement, (ii) in agreements evidencing Indebtedness permitted by
Section 6.1(j) that impose restrictions on the property so leased or acquired,
(iii) by reason of customary provisions restricting assignments, subletting or
other transfers contained in leases, licenses, joint venture agreements, sales
and procurement contracts and similar agreements entered into in the ordinary
course of business or in connection with sale and lease-back transactions
permitted under Section 6.10, (iv) that are or were created by virtue of any
transfer of, agreement to transfer or option or right with respect to any
property, assets or Equity Interests not otherwise prohibited under this
Agreement, (v) described on Schedule 6.5, (vi) restrictions and conditions
imposed by law, (vii) Contractual Obligations binding on a Subsidiary acquired
by any Credit Party in a Permitted Acquisition at the time such Subsidiary first
becomes a Subsidiary, so long as such contractual obligations were not entered
into solely in contemplation of such Person becoming a Subsidiary,
(viii) restrictions on cash deposits and requirements to maintain net worth
imposed by vendors under contracts entered into in the ordinary course of
business, (ix) restrictions on cash deposits made by customers in the ordinary
course of business that are subject to return to such customers and (x) any
restrictions imposed by any amendments, modifications, restatements, renewals,
increases, supplements, refundings, replacements or refinancings of the
Contractual Obligations

 

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or Indebtedness referred to in clauses (i) through (ix) above, provided that,
such amendments, modifications, restatements, renewals, increases, supplements,
refundings, replacements or refinancings are, in the good faith judgment of
Borrower, no more restrictive with respect to such encumbrance and other
restrictions taken as a whole than those prior to such amendment, modification,
restatement, renewal, increase, supplement, refunding, replacement or
refinancing.

 

6.6.   Investments.  No Credit Party shall, nor shall it permit any of its
Subsidiaries to, directly or indirectly, make or own any Investment in any
Person, including any Joint Venture, except:

 

(a)   Investments in Cash and Cash Equivalents;

 

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

 

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

 

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

 

(e)   Consolidated Capital Expenditures with respect to Borrower and the
Guarantors permitted by Section 6.7(c);

 

(f)   loans and advances to employees of Holdings and its Subsidiaries made in
the ordinary course of business in an aggregate principal amount not to exceed
$5,750,000 in the aggregate;

 

(g)   Permitted Acquisitions permitted pursuant to Section 6.8 and any
Investment held by the Person which is the subject of the Permitted Acquisition;
provided that, such Investment was not acquired by such Person in contemplation
of such Permitted Acquisition;

 

(h)   Investments described in Schedule 6.6;

 

(i)   the Acquisition;

 

(j)   investments consisting of non-cash consideration received by Borrower or
any Subsidiary in connection with any Asset Sale permitted by Section 6.8(c);

 

(k)   Specified Investments;

 

(l)   minority Investments made in cooperatives required to obtain goods or
services in the ordinary course of business, not to exceed $5,750,000 at any
time outstanding;

 

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(m)   other Investments in Subsidiaries or joint ventures other than
wholly-owned Guarantor Subsidiaries of Borrower in an aggregate amount not to
exceed at any time $23,000,000;

 

(n)   guarantees constituting Indebtedness permitted by Section 6.1(b);

 

(o)   deposits, prepayments and other credits made or extended to suppliers in
an amount not to exceed $5,750,000 at any time outstanding;

 

(p)   capital contributions to Louisiana Timber Procurement, LLC not to exceed
$11,500,000 at any time outstanding; and

 

(q)   Investments not otherwise permitted by this Section 6.6; provided that,
the aggregate amount of Investments made on or after the Closing Date in
reliance on this clause (q) (determined on the basis of the fair market value of
the assets invested at the time so invested, in the case of non-cash
Investments) shall not exceed $11,500,000 at any time outstanding.

 

Notwithstanding the foregoing, in no event shall any Credit Party make any
Investment (i) which results in or facilitates in any manner any Restricted
Junior payment not otherwise permitted under the terms of Section 6.4 or
(ii) which consists of Margin Stock in excess of $1,000,000.

 

6.7.   Financial Covenants.

 

(a)   Intentionally Omitted.

 

(b)   Leverage Ratio.  Holdings shall not permit the Leverage Ratio as of the
last day of any Fiscal Quarter, beginning with the Fiscal Quarter ending
June 30, 2008 to exceed the correlative ratio indicated:

 

Fiscal Quarter End

 

Leverage Ratio

 

June 30, 2008

 

5.25:1.00

 

September 30, 2008

 

5.00:1.00

 

December 31, 2008

 

4.75:1.00

 

March 31, 2009

 

4.75:1.00

 

June 30, 2009

 

4.50:1.00

 

September 30, 2009

 

4.25:1.00

 

December 31, 2009

 

4.00:1.00

 

March 31, 2010

 

3.75:1.00

 

June 30, 2010

 

3.50:1.00

 

September 30, 2010

 

3.50:1.00

 

December 31, 2010

 

3.50:1.00

 

 

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Fiscal Quarter End

 

Leverage Ratio

 

March 31, 2011 and thereafter

 

3.25:1.00

 

 

(c)   Maximum Consolidated Capital Expenditures.  Holdings shall not, and shall
not permit its Subsidiaries to, make or incur Consolidated Capital Expenditures,
in any Fiscal Year, in an aggregate amount for Holdings and its Subsidiaries in
excess of $172,500,000 for such Fiscal Year; provided, such amount for any
Fiscal Year shall be increased by an amount equal to the excess, if any (but in
no event more than $86,250,000) of such amount for the immediately preceding
Fiscal Year (as adjusted in accordance with this proviso) over the actual amount
of Consolidated Capital Expenditures for such previous Fiscal Year.

 

(d)   Certain Calculations.  With respect to any period during which any
Investment, a Permitted Acquisition or an Asset Sale or other disposition has
occurred (each, a “Subject Transaction”), for purposes of determining compliance
with the financial covenants set forth in this Section 6.7, Consolidated
Adjusted EBITDA shall be calculated with respect to such period on a pro forma
basis (including (x) pro forma adjustments arising out of events which are
directly attributable to a specific transaction, are factually supportable and
are expected to have a continuing impact, in each case determined on a basis
consistent with Article 11 of Regulation S-X promulgated under the Securities
Act and as interpreted by the staff of the Securities and Exchange Commission,
which would include cost savings resulting from head count reduction, closure of
facilities and similar restructuring charges, which pro forma adjustments shall
be certified by the chief financial officer of Holdings and (y) pro forma
adjustments for cost savings that Holdings reasonably determines are probable
based upon specifically identified actions to be taken within six months of the
date of a Subject Transaction (net of any reduction in Consolidated Adjusted
EBITDA as a result of such cost savings that Holdings reasonably determines are
probable) in an amount not to exceed 10% of the Consolidated Adjusted EBITDA of
the entity acquired or disposed of in connection with such Subject Transaction;
provided that Holdings’ chief financial officer shall have certified in an
officer’s certificate delivered to the Administrative Agent the specific actions
to be taken, the cost savings to be achieved from each such action, that such
savings have been determined to be probable and the amount, if any, of any
reduction in Consolidated Adjusted EBITDA in connection therewith) using the
historical audited (if available) financial statements of any business so
acquired or to be acquired or sold or to be sold and the consolidated financial
statements of Holdings and its Subsidiaries which shall be reformulated as if
such Subject Transaction, and any Indebtedness incurred or repaid in connection
therewith, had been consummated or incurred or repaid at the beginning of such
period (and assuming that such Indebtedness bears interest during any portion of
the applicable measurement period prior to the relevant acquisition at the
weighted average of the interest rates applicable to outstanding Loans incurred
during such period).

 

6.8.   Fundamental Changes; Disposition of Assets; Acquisitions.  No Credit
Party shall, nor shall it permit any of its Subsidiaries to, enter into any
transaction of merger or consolidation, or liquidate, wind-up or dissolve itself
(or suffer any liquidation or dissolution), or convey, sell, lease, enter into
an Exclusive IP License, exchange, transfer or otherwise dispose of, in one
transaction or a series of transactions, all or any part of its business, assets
or property

 

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of any kind whatsoever, whether real, personal or mixed and whether tangible or
intangible, whether now owned or hereafter acquired or leased, or acquire by
purchase or otherwise (other than purchases or other acquisitions of inventory,
materials and equipment and Capital Expenditures in the ordinary course of
business) the business, property or fixed assets of, or stock or other evidence
of beneficial ownership of, any Person or any division or line of business or
other business unit of any Person, except:

 

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

 

(b)   Borrower may permit another Person to merge or consolidate with Borrower
or a Subsidiary in order to effect a Permitted Acquisition that is permitted
hereunder (provided that the surviving entity is the Borrower or a wholly-owned
Subsidiary);

 

(c)   sales, transfers or other dispositions of assets that do not constitute
Asset Sales;

 

(d)   Asset Sales (including Exclusive IP Licenses), the proceeds of which
(valued at the principal amount thereof in the case of non-Cash proceeds
consisting of notes or other debt Securities and valued at fair market value in
the case of other non-Cash proceeds) when aggregated with the proceeds of all
other Asset Sales made within the same Fiscal Year, are less than $57,500,000;
provided (other than in the case of Exclusive IP Licenses that are not fully
paid) (1) the consideration received for such assets shall be in an amount at
least equal to the fair market value thereof (determined in good faith by an
Authorized Officer of Borrower), (2) no less than 80% thereof shall be paid in
Cash, and (3) the Net Asset Sale Proceeds thereof shall be applied as required
by Section 2.14(a);

 

(e)   disposals of obsolete, worn out or surplus property;

 

(f)   Permitted Acquisitions, the Acquisition Consideration for which
constitutes (i) less than $143,750,000 in the aggregate in any Fiscal Year and
(ii) less than $230,000,000 in the aggregate from the Closing Date to the date
of determination; provided, in respect of acquisition targets not domiciled
within the United States, the consideration for such Persons or assets shall not
exceed more than $57,500,000 per Fiscal Year;

 

(g)   Investments made in accordance with Section 6.6;

 

(h)   sales, transfers and dispositions to Borrower or a Subsidiary; provided
that, any such sales, transfers or dispositions involving a Subsidiary that is
not a Credit Party shall be made in compliance with Section 6.11;

 

(i)   sales of any fixed or capital assets pursuant to a sale-leaseback
transaction in compliance with clause (a) of Section 6.10;

 

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(j)   licenses or sublicenses of Intellectual Property of a Credit Party or any
of its Subsidiaries (other than Exclusive IP Licenses) entered into in the
ordinary course of business, or not interfering in any respect with the ordinary
conduct of, or not materially detracting from the value of, the business of
Borrower or such Subsidiary;

 

(k)   terminations of leases in the ordinary course of business;

 

(l)   leases, subleases, licenses and sublicenses of real or personal property
entered into by Credit Parties and their Subsidiaries in the ordinary course of
business; and

 

(m)   sales of non-core assets acquired in connection with Permitted
Acquisitions.

 

6.9.   Disposal of Subsidiary Interests.  Except for any sale of all of its
interests in the Equity Interests of any of its Subsidiaries in compliance with
the provisions of Section 6.8, no Credit Party shall, nor shall it permit any of
its Subsidiaries to, (a) directly or indirectly sell, assign, pledge or
otherwise encumber or dispose of any Equity Interests of any of its
Subsidiaries, except to qualify directors if required by applicable law; or
(b) permit any of its Subsidiaries directly or indirectly to sell, assign,
pledge or otherwise encumber or dispose of any Equity Interests of any of its
Subsidiaries, except to another Credit Party (subject to the restrictions on
such disposition otherwise imposed hereunder), or to qualify directors if
required by applicable law.

 

6.10.   Sales and Lease-Backs.  No Credit Party shall, nor shall it permit any
of its Subsidiaries to, directly or indirectly, become or remain liable as
lessee or as a guarantor or other surety with respect to any lease of any
property (whether real, personal or mixed), whether now owned or hereafter
acquired, which such Credit Party (a) has sold or transferred or is to sell or
to transfer to any other Person (other than Holdings or any of its
Subsidiaries), or (b) intends to use for substantially the same purpose as any
other property which has been or is to be sold or transferred by such Credit
Party to any Person (other than Holdings or any of its Subsidiaries) in
connection with such lease, except (i) for any such sale of any fixed or capital
assets by Borrower or any Subsidiary that is made for cash consideration in an
amount not less than the cost of such fixed or capital asset and is consummated
within 90 days after Borrower or such Subsidiary acquires or completes the
construction of such fixed or capital asset, (ii) this Section 6.10 shall not
prohibit Borrower or any Subsidiary from engaging in a sale or transfer of
property permitted by Section 6.8(c) and thereafter leasing such property;
provided that (A) such sale or transfer is made solely for cash consideration,
(B) any Capital Lease obligations of Borrower or any Subsidiary created thereby
are permitted under Section 6.1 and (C) any Net Asset Sale Proceeds received in
respect of such sale or transfer shall be subject to the provisions of
Section 2.14(a), provided that the reinvestment provisions of
Section 2.14(a) shall not apply to any such Net Asset Sale Proceeds.

 

6.11.   Transactions with Shareholders and Affiliates.  No Credit Party shall,
nor shall it permit any of its Subsidiaries to, directly or indirectly, enter
into or permit to exist any transaction (including the purchase, sale, lease or
exchange of any property or the rendering of any service) with any Affiliate of
Holdings on terms that are not arm’s length; provided, the foregoing restriction
shall not apply to (a) any transaction between Borrower and any Guarantor or
between two or more Guarantors; (b) reasonable and customary fees and
indemnitees paid to

 

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members of the board of directors (or similar governing body) of Holdings and
its Subsidiaries; (c) compensation arrangements, indemnities and reimbursement
of expenses for officers and other employees of Holdings and its Subsidiaries
entered into in the ordinary course of business; (d) Restricted Junior Payments
permitted under Section 6.4; (e) transactions entered into pursuant to and in
compliance with the Supply Agreement; (f) any transactions between Holdings or
any of its Subsidiaries and Boise Cascade, L.L.C. or any of its Subsidiaries
pursuant to the Acquisition Agreement and any documents related thereto; and
(g) transactions described in Schedule 6.11.

 

6.12.   Conduct of Business.  From and after the Closing Date, no Credit Party
shall, nor shall it permit any of its Subsidiaries to, engage substantially in
any business other than (i) the businesses engaged in by such Credit Party on
the Closing Date, similar or related businesses and supportive, complementary or
ancillary businesses thereto; provided that such supportive, complementary or
ancillary businesses will not fundamentally and substantively alter the
character of the businesses of such Credit Party, taken as a whole, from the
business conducted by such Credit Party on the Closing Date, (ii) any business
acquired as an incidental part of a Permitted Acquisition; provided that, such
businesses are not acquired in anticipation of such Permitted Acquisition and
(iii) such other lines of business as may be consented to by Requisite Lenders.

 

6.13.   Permitted Activities of Holdings.  (a) Holdings shall not (i) incur,
directly or indirectly, any Indebtedness or any other obligation or liability
whatsoever other than the Indebtedness and obligations under this Agreement, the
other Credit Documents and the Related Agreements, Indebtedness permitted under
Section 6.1, liabilities imposed by law, including tax liabilities, and other
liabilities incidental to its existence; (ii) create or suffer to exist any Lien
upon any property or assets now owned or hereafter acquired, leased or licensed
by it other than the Liens created under the Collateral Documents to which it is
a party or permitted pursuant to Section 6.2; (iii) engage in any business or
activity or own any assets other than (A) holding 100% of the Equity Interests
of Borrower and activities incidental thereto, (B) performing its obligations
and activities incidental thereto under the Credit Documents, and to the extent
not inconsistent therewith, the Related Agreements, (C) holding the cash
proceeds of any Restricted Junior Payments to the extent permitted by this
Agreement, (D) filing tax reports and paying taxes in the ordinary course,
(E) preparing reports to Governmental Authorities and to its shareholders,
(F) holding directors and shareholders meetings, preparing corporate records and
other corporate activities required to maintain its separate corporate structure
or to comply with applicable law, and (G) making Restricted Junior Payments and
Investments to the extent permitted by this Agreement; (iv) consolidate with or
merge with or into, or convey, transfer, lease or license all or substantially
all its assets to, any Person; (v) sell or otherwise dispose of any Equity
Interests of any of its direct Subsidiaries; (vi) create or acquire any direct
Subsidiary or make or own any Investment in any Person other than Borrower; or
(vii) fail to hold itself out to the public as a legal entity separate and
distinct from all other Persons.

 

(b)           Boise Hong Kong Limited shall not account for more than $2,500,000
of Consolidated Adjusted EBITDA during any Fiscal Year of Borrower; provided
that if Boise Hong Kong Limited does not comply with the foregoing, such
non-compliance shall not constitute an Event of Default so long as 65% of the
Equity Interests of Boise Hong Kong Limited are pledged to Collateral Agent
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Collateral Agent at the time that financial statements of Holdings and its
Subsidiaries are required to be delivered pursuant to Section 5.1(c).

 

6.14.   Amendments or Waivers of Organizational Documents, Certain Related
Agreements and Certain Other Agreements.  Except as set forth in Section 6.15,
no Credit Party shall, nor shall it permit any of its Subsidiaries to, agree to
any material amendment, restatement, supplement or other modification to, or
waiver of, any of its Organizational Documents or any of its material rights
under any Related Agreement or the Supply Agreement after the Closing Date
without in each case obtaining the prior written consent of Requisite Lenders to
such amendment, restatement, supplement or other modification or waiver other
than any such amendment, restatement, supplement or other modification or waiver
that is not adverse to the interests of the Lenders.

 

6.15.   Amendments or Waivers with respect to First Lien Credit Agreement.  No
Credit Party shall, nor shall it permit any of its Subsidiaries to, agree to any
material amendment, restatement, supplement or other modification to, or waiver
of, any of its material rights under the First Lien Credit Agreement after the
Closing Date that is prohibited under Section 5.3 of the Intercreditor Agreement
without in each case obtaining the prior written consent of Requisite Lenders to
such amendment, restatement, supplement or other modification or waiver.

 

6.16.   Fiscal Year.  No Credit Party shall, nor shall it permit any of its
Subsidiaries to, change its Fiscal Year-end from December 31.

 

SECTION 7.   GUARANTY

 

7.1.   Guaranty of the Obligations.  Subject to the provisions of Section 7.2,
Guarantors jointly and severally hereby irrevocably and unconditionally guaranty
to Administrative Agent for the ratable benefit of the Beneficiaries the due and
punctual payment in full of all Obligations when the same shall become due,
whether at stated maturity, by required prepayment, declaration, acceleration,
demand or otherwise (including amounts that would become due but for the
operation of the automatic stay under Section 362(a) of the Bankruptcy Code,
11 U.S.C. § 362(a)) (collectively, the “Guaranteed Obligations”).

 

7.2.   Contribution by Guarantors.  All Guarantors desire to allocate among
themselves (collectively, the “Contributing Guarantors”), in a fair and
equitable manner, their obligations arising under this Guaranty.  Accordingly,
in the event any payment or distribution is made on any date by a Guarantor (a
“Funding Guarantor”) under this Guaranty such that its Aggregate Payments
exceeds its Fair Share as of such date, such Funding Guarantor shall be entitled
to a contribution from each of the other Contributing Guarantors in an amount
sufficient to cause each Contributing Guarantor’s Aggregate Payments to equal
its Fair Share as of such date.  “Fair Share” means, with respect to a
Contributing Guarantor as of any date of determination, an amount equal to
(a) the ratio of (i) the Fair Share Contribution Amount with respect to such
Contributing Guarantor to (ii) the aggregate of the Fair Share Contribution
Amounts with respect to all Contributing Guarantors multiplied by (b) the
aggregate amount paid or distributed on or before such date by all Funding
Guarantors under this Guaranty in respect of the obligations Guaranteed.  “Fair
Share Contribution Amount” means, with respect to a Contributing

 

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Guarantor as of any date of determination, the maximum aggregate amount of the
obligations of such Contributing Guarantor under this Guaranty that would not
render its obligations hereunder or thereunder subject to avoidance as a
fraudulent transfer or conveyance under Section 548 of Title 11 of the United
States Code or any comparable applicable provisions of state law; provided,
solely for purposes of calculating the “Fair Share Contribution Amount” with
respect to any Contributing Guarantor for purposes of this Section 7.2, any
assets or liabilities of such Contributing Guarantor arising by virtue of any
rights to subrogation, reimbursement or indemnification or any rights to or
obligations of contribution hereunder shall not be considered as assets or
liabilities of such Contributing Guarantor.  “Aggregate Payments” means, with
respect to a Contributing Guarantor as of any date of determination, an amount
equal to (1) the aggregate amount of all payments and distributions made on or
before such date by such Contributing Guarantor in respect of this Guaranty
(including in respect of this Section 7.2), minus (2) the aggregate amount of
all payments received on or before such date by such Contributing Guarantor from
the other Contributing Guarantors as contributions under this Section 7.2.  The
amounts payable as contributions hereunder shall be determined as of the date on
which the related payment or distribution is made by the applicable Funding
Guarantor.  The allocation among Contributing Guarantors of their obligations as
set forth in this Section 7.2 shall not be construed in any way to limit the
liability of any Contributing Guarantor hereunder.  Each Guarantor is a third
party beneficiary to the contribution agreement set forth in this Section 7.2.

 

7.3.   Payment by Guarantors.  Subject to Section 7.2, Guarantors hereby jointly
and severally agree, in furtherance of the foregoing and not in limitation of
any other right which any Beneficiary may have at law or in equity against any
Guarantor by virtue hereof, that upon the failure of Borrower to pay any of the
Guaranteed Obligations when and as the same shall become due, whether at stated
maturity, by required prepayment, declaration, acceleration, demand or otherwise
(including amounts that would become due but for the operation of the automatic
stay under Section 362(a) of the Bankruptcy Code, 11 U.S.C. § 362(a)),
Guarantors will upon demand pay, or cause to be paid, in Cash, to Administrative
Agent for the ratable benefit of Beneficiaries, an amount equal to the sum of
the unpaid principal amount of all Guaranteed Obligations then due as aforesaid,
accrued and unpaid interest on such Guaranteed Obligations (including interest
which, but for Borrower’s becoming the subject of a case under the Bankruptcy
Code, would have accrued on such Guaranteed Obligations, whether or not a claim
is allowed against Borrower for such interest in the related bankruptcy case)
and all other Guaranteed Obligations then owed to Beneficiaries as aforesaid.

 

7.4.   Liability of Guarantors Absolute.  Each Guarantor agrees that its
obligations hereunder are irrevocable, absolute, independent and unconditional
and shall not be affected by any circumstance which constitutes a legal or
equitable discharge of a guarantor or surety other than payment in full of the
Guaranteed Obligations (other than contingent obligations for which no claim has
been made).  In furtherance of the foregoing and without limiting the generality
thereof, each Guarantor agrees as follows:

 

(a)   this Guaranty is a guaranty of payment when due and not of
collectability.  The Guaranteed Obligations shall be primary obligations of each
Guarantor and this Guaranty shall not be merely a contract of surety;

 

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(b)   Administrative Agent may enforce this Guaranty upon the occurrence of an
Event of Default notwithstanding the existence of any dispute between Borrower
and any Beneficiary with respect to the existence of such Event of Default;

 

(c)   the obligations of each Guarantor hereunder are independent of the
obligations of Borrower and the obligations of any other guarantor (including
any other Guarantor) of the obligations of Borrower, and a separate action or
actions may be brought and prosecuted against such Guarantor whether or not any
action is brought against Borrower or any of such other guarantors and whether
or not Borrower is joined in any such action or actions;

 

(d)   payment by any Guarantor of a portion, but not all, of the Guaranteed
Obligations shall in no way limit, affect, modify or abridge any Guarantor’s
liability for any portion of the Guaranteed Obligations which has not been
paid.  Without limiting the generality of the foregoing, if Administrative Agent
is awarded a judgment in any suit brought to enforce any Guarantor’s covenant to
pay a portion of the Guaranteed Obligations, such judgment shall not be deemed
to release such Guarantor from its covenant to pay the portion of the Guaranteed
Obligations that is not the subject of such suit, and such judgment shall not,
except to the extent satisfied by such Guarantor, limit, affect, modify or
abridge any other Guarantor’s liability hereunder in respect of the Guaranteed
Obligations;

 

(e)   any Beneficiary, upon such terms as it deems appropriate, without notice
or demand and without affecting the validity or enforceability hereof or giving
rise to any reduction, limitation, impairment, discharge or termination of any
Guarantor’s liability hereunder, from time to time may (i) renew, extend,
accelerate, increase the rate of interest on, or otherwise change the time,
place, manner or terms of payment of the Guaranteed Obligations; (ii) settle,
compromise, release or discharge, or accept or refuse any offer of performance
with respect to, or substitutions for, the Guaranteed Obligations or any
agreement relating thereto and/or subordinate the payment of the same to the
payment of any other obligations; (iii) request and accept other guaranties of
the Guaranteed Obligations and take and hold security for the payment hereof or
the Guaranteed Obligations; (iv) release, surrender, exchange, substitute,
compromise, settle, rescind, waive, alter, subordinate or modify, with or
without consideration, any security for payment of the Guaranteed Obligations,
any other guaranties of the Guaranteed Obligations, or any other obligation of
any Person (including any other Guarantor) with respect to the Guaranteed
Obligations; (v) enforce and apply any security now or hereafter held by or for
the benefit of such Beneficiary in respect hereof or the Guaranteed Obligations
and direct the order or manner of sale thereof, or exercise any other right or
remedy that such Beneficiary may have against any such security, in each case as
such Beneficiary in its discretion may determine consistent herewith and with
any applicable security agreement, including foreclosure on any such security
pursuant to one or more judicial or nonjudicial sales, whether or not every
aspect of any such sale is commercially reasonable, and even though such action
operates to impair or extinguish any right of reimbursement or subrogation or
other right or remedy of any Guarantor against Borrower or any security for the
Guaranteed Obligations; and (vi) exercise any other rights available to it under
the Credit Documents; and

 

(f)   this Guaranty and the obligations of Guarantors hereunder shall be valid
and enforceable and shall not be subject to any reduction, limitation,
impairment, discharge or termination for any reason (other than payment in full
of the Guaranteed Obligations (other than

 

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contingent obligations for which no claim has been made)), including the
occurrence of any of the following, whether or not any Guarantor shall have had
notice or knowledge of any of them: (i) any failure or omission to assert or
enforce or agreement or election not to assert or enforce, or the stay or
enjoining, by order of court, by operation of law or otherwise, of the exercise
or enforcement of, any claim or demand or any right, power or remedy (whether
arising under the Credit Documents, at law, in equity or otherwise) with respect
to the Guaranteed Obligations or any agreement relating thereto, or with respect
to any other guaranty of or security for the payment of the Guaranteed
Obligations; (ii) any rescission, waiver, amendment or modification of, or any
consent to departure from, any of the terms or provisions (including provisions
relating to events of default) hereof, of any of the other Credit Documents or
any agreement or instrument executed pursuant thereto, or of any other guaranty
or security for the Guaranteed Obligations, in each case whether or not in
accordance with the terms hereof or of such Credit Document or any agreement
relating to such other guaranty or security; (iii) the Guaranteed Obligations,
or any agreement relating thereto, at any time being found to be illegal,
invalid or unenforceable in any respect; (iv) the application of payments
received from any source (other than payments received pursuant to the other
Credit Documents or from the proceeds of any security for the Guaranteed
Obligations, except to the extent such security also serves as collateral for
indebtedness other than the Guaranteed Obligations) to the payment of
indebtedness other than the Guaranteed Obligations, even though any Beneficiary
might have elected to apply such payment to any part or all of the Guaranteed
Obligations; (v) any Beneficiary’s consent to the change, reorganization or
termination of the corporate structure or existence of Holdings or any of its
Subsidiaries and to any corresponding restructuring of the Guaranteed
Obligations; (vi) any failure to perfect or continue perfection of a security
interest in any collateral which secures any of the Guaranteed Obligations;
(vii) any defenses (other than payment in full of the Guaranteed Obligations
(other than contingent obligations for which no claim has been made)), set-offs
or counterclaims which Borrower may allege or assert against any Beneficiary in
respect of the Guaranteed Obligations, including failure of consideration,
breach of warranty, payment, statute of frauds, statute of limitations, accord
and satisfaction and usury; and (viii) any other act or thing or omission, or
delay to do any other act or thing, which may or might in any manner or to any
extent vary the risk of any Guarantor as an obligor in respect of the Guaranteed
Obligations.

 

7.5.   Waivers by Guarantors.  Each Guarantor hereby waives, to the extent
permitted by applicable law, for the benefit of Beneficiaries: (a) any right to
require any Beneficiary, as a condition of payment or performance by such
Guarantor, to (i) proceed against Borrower, any other guarantor (including any
other Guarantor) of the Guaranteed Obligations or any other Person, (ii) proceed
against or exhaust any security held from Borrower, any such other guarantor or
any other Person, (iii) proceed against or have resort to any balance of any
Deposit Account or credit on the books of any Beneficiary in favor of Borrower
or any other Person, or (iv) pursue any other remedy in the power of any
Beneficiary whatsoever; (b) any defense arising by reason of the incapacity,
lack of authority or any disability or other defense of Borrower or any other
Guarantor including any defense based on or arising out of the lack of validity
or the unenforceability of the Guaranteed Obligations or any agreement or
instrument relating thereto or by reason of the cessation of the liability of
Borrower or any other Guarantor from any cause other than payment in full of the
Guaranteed Obligations (other than contingent obligations for which no claim has
been made); (c) any defense based upon any statute or rule of law which provides
that the obligation of a surety must be neither larger in amount nor in other

 

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respects more burdensome than that of the principal; (d) any defense based upon
any Beneficiary’s errors or omissions in the administration of the Guaranteed
Obligations, except behavior which amounts to gross negligence, bad faith or
willful misconduct; (e) (i) any principles or provisions of law, statutory or
otherwise, which are or might be in conflict with the terms hereof and any legal
or equitable discharge of such Guarantor’s obligations hereunder, (ii) the
benefit of any statute of limitations affecting such Guarantor’s liability
hereunder or the enforcement hereof, (iii) any rights to set-offs, recoupments
and counterclaims, and (iv) promptness, diligence and any requirement that any
Beneficiary protect, secure, perfect or insure any security interest or lien or
any property subject thereto; (f) notices, demands, presentments, protests,
notices of protest, notices of dishonor and notices of any action or inaction,
including acceptance hereof, notices of default hereunder or under any agreement
or instrument related thereto, notices of any renewal, extension or modification
of the Guaranteed Obligations or any agreement related thereto, notices of any
extension of credit to Borrower and notices of any of the matters referred to in
Section 7.4 and any right to consent to any thereof; and (g) any defenses or
benefits that may be derived from or afforded by law which limit the liability
of or exonerate guarantors or sureties, or which may conflict with the terms
hereof.

 

7.6.   Guarantors’ Rights of Subrogation, Contribution, etc.  Until the
Guaranteed Obligations (other than contingent obligations for which no claim has
been made) shall have been paid in full, each Guarantor hereby waives, to the
extent permitted by applicable law, its right to enforce any claim, right or
remedy, direct or indirect, that such Guarantor now has or may hereafter have
against Borrower or any other Guarantor or any of its assets in connection with
this Guaranty or the performance by such Guarantor of its obligations hereunder,
in each case whether such claim, right or remedy arises in equity, under
contract, by statute, under common law or otherwise and including (a) any right
of subrogation, reimbursement or indemnification that such Guarantor now has or
may hereafter have against Borrower with respect to the Guaranteed Obligations,
(b) any right to enforce, or to participate in, any claim, right or remedy that
any Beneficiary now has or may hereafter have against Borrower, and (c) any
benefit of, and any right to participate in, any collateral or security now or
hereafter held by any Beneficiary.  In addition, until the Guaranteed
Obligations (other than contingent obligations for which no claim has been made)
shall have been paid in full, each Guarantor shall withhold exercise of any
right of contribution such Guarantor may have against any other guarantor
(including any other Guarantor) of the Guaranteed Obligations, including any
such right of contribution as contemplated by Section 7.2.  Each Guarantor
further agrees that, to the extent the waiver or agreement to withhold the
exercise of its rights of subrogation, reimbursement, indemnification and
contribution as set forth herein is found by a court of competent jurisdiction
to be void or voidable for any reason, any rights of subrogation, reimbursement
or indemnification such Guarantor may have against Borrower or against any
collateral or security, and any rights of contribution such Guarantor may have
against any such other guarantor, shall be junior and subordinate to any rights
any Beneficiary may have against Borrower, to all right, title and interest any
Beneficiary may have in any such collateral or security, and to any right any
Beneficiary may have against such other guarantor.  If any amount shall be paid
to any Guarantor on account of any such subrogation, reimbursement,
indemnification or contribution rights at any time when all Guaranteed
Obligations (other than contingent obligations for which no claim has been made)
shall not have been paid in full, such amount shall be held in trust for
Administrative Agent on behalf of Beneficiaries and shall forthwith be paid over
to

 

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Administrative Agent for the benefit of Beneficiaries to be credited and applied
against the Guaranteed Obligations, whether matured or unmatured, in accordance
with the terms hereof.

 

7.7.   Subordination of Other Obligations.  Any Indebtedness of Borrower or any
Guarantor now or hereafter held by any Guarantor (the “Obligee Guarantor”) is
hereby subordinated in right of payment to the Guaranteed Obligations, and any
such Indebtedness collected or received by the Obligee Guarantor after an Event
of Default has occurred and is continuing shall be held in trust for
Administrative Agent on behalf of Beneficiaries and shall forthwith be paid over
to Administrative Agent for the benefit of Beneficiaries to be credited and
applied against the Guaranteed Obligations but without affecting, impairing or
limiting in any manner the liability of the Obligee Guarantor under any other
provision hereof.

 

7.8.   Continuing Guaranty.  This Guaranty is a continuing guaranty and shall
remain in effect until all of the Guaranteed Obligations (other than contingent
obligations for which no claim has been made) shall have been paid in full. 
Each Guarantor hereby irrevocably waives any right to revoke this Guaranty as to
future transactions giving rise to any Guaranteed Obligations.

 

7.9.   Authority of Guarantors or Borrower.  It is not necessary for any
Beneficiary to inquire into the capacity or powers of any Guarantor or Borrower
or the officers, directors or any agents acting or purporting to act on behalf
of any of them.

 

7.10.   Financial Condition of Borrower.  Any Credit Extension may be made to
Borrower or continued from time to time without notice to or authorization from
any Guarantor regardless of the financial or other condition of Borrower at the
time of any such grant or continuation.  No Beneficiary shall have any
obligation to disclose or discuss with any Guarantor its assessment, or any
Guarantor’s assessment, of the financial condition of Borrower.  Each Guarantor
has adequate means to obtain information from Borrower on a continuing basis
concerning the financial condition of Borrower and its ability to perform its
obligations under the Credit Documents, and each Guarantor assumes the
responsibility for being and keeping informed of the financial condition of
Borrower and of all circumstances bearing upon the risk of nonpayment of the
Guaranteed Obligations.  Each Guarantor hereby waives and relinquishes any duty
on the part of any Beneficiary to disclose any matter, fact or thing relating to
the business, operations or conditions of Borrower now known or hereafter known
by any Beneficiary.

 

7.11.   Bankruptcy, etc.   (a)  So long as any Guaranteed Obligations remain
outstanding, no Guarantor shall, without the prior written consent of
Administrative Agent acting pursuant to the instructions of Requisite Lenders,
commence or join with any other Person in commencing any bankruptcy,
reorganization or insolvency case or proceeding of or against Borrower or any
other Guarantor.  The obligations of Guarantors hereunder shall not be reduced,
limited, impaired, discharged, deferred, suspended or terminated by any case or
proceeding, voluntary or involuntary, involving the bankruptcy, insolvency,
receivership, reorganization, liquidation or arrangement of Borrower or any
other Guarantor or by any defense which Borrower or any other Guarantor may have
by reason of the order, decree or decision of any court or administrative body
resulting from any such proceeding.

 

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(b)   Each Guarantor acknowledges and agrees that any interest on any portion of
the Guaranteed Obligations which accrues after the commencement of any case or
proceeding referred to in clause (a) above (or, if interest on any portion of
the Guaranteed Obligations ceases to accrue by operation of law by reason of the
commencement of such case or proceeding, such interest as would have accrued on
such portion of the Guaranteed Obligations if such case or proceeding had not
been commenced) shall be included in the Guaranteed Obligations because it is
the intention of Guarantors and Beneficiaries that the Guaranteed Obligations
which are guaranteed by Guarantors pursuant hereto should be determined without
regard to any rule of law or order which may relieve Borrower of any portion of
such Guaranteed Obligations.  Guarantors will permit any trustee in bankruptcy,
receiver, debtor in possession, assignee for the benefit of creditors or similar
Person to pay Administrative Agent, or allow the claim of Administrative Agent
in respect of, any such interest accruing after the date on which such case or
proceeding is commenced.

 

(c)   In the event that all or any portion of the Guaranteed Obligations are
paid by Borrower, the obligations of Guarantors hereunder shall continue and
remain in full force and effect or be reinstated, as the case may be, in the
event that all or any part of such payment(s) are rescinded or recovered
directly or indirectly from any Beneficiary as a preference, fraudulent transfer
or otherwise, and any such payments which are so rescinded or recovered shall
constitute Guaranteed Obligations for all purposes hereunder.

 

7.12.   Discharge of Guaranty Upon Sale of Guarantor.  If all of the Equity
Interests of any Guarantor or any of its successors in interest hereunder shall
be sold or otherwise disposed of (including by merger or consolidation) in
accordance with the terms and conditions hereof, the Guaranty of such Guarantor
or such successor in interest, as the case may be, hereunder shall automatically
be discharged and released without any further action by any Beneficiary or any
other Person effective as of the time of such Asset Sale (including by merger or
consolidation).

 

SECTION 8.   EVENTS OF DEFAULT

 

8.1.   Events of Default.  If any one or more of the following conditions or
events shall occur:

 

(a)   Failure to Make Payments When Due.  Failure by Borrower to pay (i) when
due any installment of principal of any Loan, whether at stated maturity, by
acceleration, by notice of voluntary prepayment, by mandatory prepayment or
otherwise; or (ii) any interest on any Loan or any fee or any other amount due
hereunder within five days after the date due; or

 

(b)   Default in Other Agreements.  (i) Failure of any Credit Party or any of
their respective Subsidiaries to pay when due any principal of or premium on or
interest on or any other amount in the nature of interest payable in respect of
one or more items of Indebtedness (other than Indebtedness referred to in
Section 8.1(a)) with an aggregate principal amount of $17,250,000 or more, in
each case beyond the grace period, if any, provided therefor; or (ii) breach or
default by any Credit Party with respect to any other material term of any loan
agreement, mortgage, indenture or other agreement relating to one or more items
of Indebtedness in the individual or aggregate principal amounts referred to in
clause (i) above, in each case

 

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beyond the grace period, if any, provided therefor, if the effect of such breach
or default is to cause, or to permit the holder or holders of that Indebtedness
(or a trustee on behalf of such holder or holders), to cause, that Indebtedness
to become or be declared due and payable (or redeemable) prior to its stated
maturity or the stated maturity of any underlying obligation, as the case may
be; provided, that with respect to any such failure to pay or breach or default
under the First Lien Credit Agreement, such event shall only constitute an Event
of Default hereunder if there is an Event of Default (as defined in the First
Lien Credit Agreement) under subsection 8.1(a) of the First Lien Credit
Agreement, if the First Lien Credit Facilities shall have been accelerated or if
60 days have passed since the date of any Event of Default (as defined in the
First Lien Credit Agreement) (other than an Event of Default (as defined in the
First Lien Credit Agreement) under subsection 8.1(a) of the First Lien Credit
Agreement) under the First Lien Credit Agreement and such Event of Default under
the First Lien Credit Agreement has not been cured or waived during such period;
or

 

(c)   Breach of Certain Covenants.  Failure of any Credit Party to perform or
comply with any term or condition contained in Section 2.6, Section 5.1(f),
Section 5.2 (with respect to the existence of Holdings, Borrower or any Material
Subsidiary) or Section 6; or

 

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

 

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

(f)   Involuntary Bankruptcy; Appointment of Receiver, etc.  (i) A court of
competent jurisdiction shall enter a decree or order for relief in respect of
Holdings or any of its Material Subsidiaries in an involuntary case under the
Bankruptcy Code or under any other applicable bankruptcy, insolvency or similar
law now or hereafter in effect, which decree or order is not stayed; or any
other similar relief shall be granted under any applicable federal or state law;
or (ii) an involuntary case shall be commenced against Holdings or any of its
Material Subsidiaries under the Bankruptcy Code or under any other applicable
bankruptcy, insolvency or similar law now or hereafter in effect; or a decree or
order of a court having jurisdiction in the premises for the appointment of a
receiver, liquidator, sequestrator, trustee, custodian or other officer having
similar powers over Holdings or any of its Material Subsidiaries, or over all or
a substantial part of its property, shall have been entered; or there shall have
occurred the involuntary appointment of an interim receiver, trustee or other
custodian of Holdings or any of its Material Subsidiaries for all or a
substantial part of its property; or a warrant of attachment, execution or
similar process shall have been issued against any substantial part of the
property of Holdings or any of its Material Subsidiaries, and any such event
described in this clause (ii) shall continue for sixty days without having been
dismissed, bonded or discharged; or

 

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

 

(h)   Judgments and Attachments.  Any money judgment, writ or warrant of
attachment or similar process involving in the aggregate at any time an amount
in excess of $17,250,000 (in either case to the extent not adequately covered by
insurance as to which a solvent and unaffiliated insurance company has
acknowledged coverage) shall be entered or filed against Holdings or any of its
Subsidiaries or any of their respective assets and shall remain undischarged,
unvacated, unbonded or unstayed for a period of sixty days (or in any event
later than five days prior to the date of any proposed sale thereunder); or

 

(i)   Reserved.

 

(j)   Employee Benefit Plans.  (i) There shall occur one or more ERISA Events
which individually or in the aggregate results in or could reasonably be
expected to result in liability of Holdings, any of its Subsidiaries or any of
their respective ERISA Affiliates in excess of $17,250,000 during the term
hereof; or (ii) there exists any fact or circumstance that reasonably could be
expected to result in the imposition of a Lien or security interest under
Section 430(k) of the Internal Revenue Code or under ERISA; or

(k)   Change of Control.  A Change of Control shall occur; or

 

(l)   Guaranties, Collateral Documents and other Credit Documents.  At any time
after the execution and delivery thereof, (i) the Guaranty for any reason, other
than the satisfaction in full of all Obligations (other than contingent
obligations for which no claim has been made), shall cease to be in full force
and effect (other than in accordance with its terms) or shall be declared to be
null and void or any Guarantor shall repudiate its obligations thereunder, or
(ii) this Agreement, the Intercreditor Agreement or any Collateral Document
ceases to be in full force and effect (other than by reason of a release of
Collateral in accordance with the terms hereof or thereof, the satisfaction in
full of the Obligations (other than contingent obligations for which no claim
has been made) in accordance with the terms hereof or the termination thereof in
accordance with its terms) or shall be declared null and void, or Collateral
Agent shall not have or shall cease to have a valid and perfected Lien in any
Collateral purported to be covered by the Collateral Documents (other than
Collateral not required to be perfected and Collateral with an aggregate fair
market value not exceeding $5,750,000) with the priority required by the
relevant Collateral Document, in each case for any reason other than the failure
of Collateral Agent or

 

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any Secured Party to take any action within its control, or (iii) any Credit
Party shall contest the validity or enforceability of any Credit Document in
writing or deny in writing that it has any further liability, including with
respect to future advances by Lenders, under any Credit Document to which it is
a party or shall contest the validity or perfection of any Lien in any
Collateral purported to be covered by the Collateral Documents;

 

THEN, subject to the Intercreditor Agreement, (1) upon the occurrence of any
Event of Default described in Section 8.1(f) or 8.1(g), automatically, and
(2) if any other Event of Default has occurred and is continuing, at the request
of (or with the consent of) Requisite Lenders, upon notice to Borrower by
Administrative Agent, (A) each of the following shall immediately become due and
payable, in each case without presentment, demand, protest or other requirements
of any kind, all of which are hereby expressly waived by each Credit Party to
the extent permitted by applicable law: (I) the unpaid principal amount of and
accrued interest on the Loans, and (II) all other Obligations; and
(B) Administrative Agent may cause Collateral Agent to enforce any and all Liens
and security interests created pursuant to Collateral Documents.

 

SECTION 9.   AGENTS

 

9.1.   Appointment of Agents.  GSCP is hereby appointed Syndication Agent
hereunder, and each Lender hereby authorizes GSCP to act as Syndication Agent in
accordance with the terms hereof and the other Credit Documents.  LCPI is hereby
appointed Administrative Agent and Collateral Agent hereunder and under the
other Credit Documents and each Lender hereby authorizes LCPI to act as
Administrative Agent and Collateral Agent in accordance with the terms hereof
and the other Credit Documents.  Lehman Brothers Inc. is hereby appointed
Documentation Agent hereunder, and each Lender hereby authorizes Lehman Brothers
Inc. to act as Documentation Agent in accordance with the terms hereof and the
other Credit Documents.  Each Agent hereby agrees to act in its capacity as such
upon the express conditions contained herein and the other Credit Documents, as
applicable.  The provisions of this Section 9 are solely for the benefit of
Agents and Lenders and no Credit Party shall have any rights as a third party
beneficiary of any of the provisions thereof (except as set forth in
Section 9.7).  In performing its functions and duties hereunder, each Agent
shall act solely as an agent of Lenders and does not assume and shall not be
deemed to have assumed any obligation towards or relationship of agency or trust
with or for Holdings or any of its Subsidiaries.  Each of Syndication Agent and
Documentation Agent, without consent of or notice to any party hereto, may
assign any and all of its rights or obligations hereunder to any of its
Affiliates.  As of the Closing Date, neither GSCP, in its capacity as
Syndication Agent, nor Lehman Brothers Inc., in its capacity as Documentation
Agent, shall have any obligations but shall be entitled to all benefits of this
Section 9.

 

9.2.   Powers and Duties.  Each Lender irrevocably authorizes each Agent to take
such action on such Lender’s behalf and to exercise such powers, rights and
remedies hereunder and under the other Credit Documents as are specifically
delegated or granted to such Agent by the terms hereof and thereof, together
with such powers, rights and remedies as are reasonably incidental thereto. 
Each Agent shall have only those duties and responsibilities that are expressly
specified herein and in the other Credit Documents.  Each Agent may exercise
such powers,

 

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rights and remedies and perform such duties by or through its agents or
employees.  No Agent shall have, by reason hereof or any of the other Credit
Documents, a fiduciary relationship in respect of any Lender; and nothing herein
or in any of the other Credit Documents, expressed or implied, is intended to or
shall be so construed as to impose upon any Agent any obligations in respect
hereof or any of the other Credit Documents except as expressly set forth herein
or therein.  Administrative Agent hereby agrees that it shall (i) furnish to
GSCP, in its capacity as Syndication Agent, upon GSCP’s request, a copy of the
Register, (ii) cooperate with GSCP in granting access to any Lenders (or
potential Lenders) who GSCP identifies to the Platform and (iii) maintain GSCP’s
access to the Platform.

 

9.3.   General Immunity.

 

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

 

(b)   Exculpatory Provisions.  No Agent nor any of its officers, partners,
directors, employees or agents shall be liable to Lenders for any action taken
or omitted by any Agent under or in connection with any of the Credit Documents
except to the extent caused by such Agent’s gross negligence or willful
misconduct, as determined by a final, non-appealable judgment of a court of
competent jurisdiction.  Each Agent shall be entitled to refrain from any act or
the taking of any action (including the failure to take an action) in connection
herewith or any of the other Credit Documents or from the exercise of any power,
discretion or authority vested in it hereunder or thereunder unless and until
such Agent shall have received instructions in respect thereof from Requisite
Lenders (or such other Lenders as may be required to give such instructions
under Section 10.5) and, upon receipt of such instructions from Requisite
Lenders (or such other Lenders, as the case may be), such Agent shall be
entitled to act or (where so instructed) refrain from acting, or to exercise
such power, discretion or authority, in accordance with such instructions. 
Without prejudice to the generality of the foregoing, (i) each Agent shall be
entitled to rely, and shall be fully protected in relying, upon any
communication, instrument or document believed by it to be genuine and correct
and to have been signed or sent by the proper Person or Persons, and shall be
entitled to rely and shall be protected in relying on opinions and judgments of
attorneys (who may be attorneys for Holdings and its Subsidiaries), accountants,
experts and other professional advisors selected by it; and (ii) no Lender shall
have any right of action whatsoever against any Agent as a result of such Agent
acting or (where so

 

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instructed) refraining from acting hereunder or under any of the other Credit
Documents in accordance with the instructions of Requisite Lenders (or such
other Lenders as may be required to give such instructions under Section 10.5).

 

(c)   Delegation of Duties. Administrative Agent may perform any and all of its
duties and exercise its rights and powers under this Agreement or under any
other Credit Document by or through any one or more sub-agents appointed by
Administrative Agent. Administrative Agent and any such sub-agent may perform
any and all of its duties and exercise its rights and powers by or through their
respective Affiliates. The exculpatory, indemnification and other provisions of
this Section 9.3 and of Section 9.6 shall apply to any of the Affiliates of
Administrative Agent and shall apply to their respective activities in
connection with the syndication of the credit facilities provided for herein as
well as activities as Administrative Agent.  All of the rights, benefits, and
privileges (including the exculpatory and indemnification provisions) of this
Section 9.3 and of Section 9.6 shall apply to any such sub-agent and to the
Affiliates of any such sub-agent, and shall apply to their respective activities
as sub-agent as if such sub-agent and Affiliates were named herein. 
Notwithstanding anything herein to the contrary, with respect to each sub-agent
appointed by Administrative Agent, (i) such sub-agent shall be a third party
beneficiary under this Agreement with respect to all such rights, benefits and
privileges (including exculpatory rights and rights to indemnification) and
shall have all of the rights and benefits of a third party beneficiary,
including an independent right of action to enforce such rights, benefits and
privileges (including exculpatory rights and rights to indemnification)
directly, without the consent or joinder of any other Person, against any or all
of the Credit Parties and the Lenders, (ii) such rights, benefits and privileges
(including exculpatory rights and rights to indemnification) shall not be
modified or amended without the consent of such sub-agent, and (iii) such
sub-agent shall only have obligations to Administrative Agent and not to any
Credit Party, Lender or any other Person and no Credit Party, Lender or any
other Person shall have any rights, directly or indirectly, as a third party
beneficiary or otherwise, against such sub-agent.

 

9.4.   Agents Entitled to Act as Lender.  The agency hereby created shall in no
way impair or affect any of the rights and powers of, or impose any duties or
obligations upon, any Agent in its individual capacity as a Lender hereunder. 
With respect to its participation in the Loans, each Agent shall have the same
rights and powers hereunder as any other Lender and may exercise the same as if
it were not performing the duties and functions delegated to it hereunder, and
the term “Lender” shall, unless the context clearly otherwise indicates, include
each Agent in its individual capacity.  Any Agent and its Affiliates may accept
deposits from, lend money to, own securities of, and generally engage in any
kind of banking, trust, financial advisory or other business with Holdings or
any of its Affiliates as if it were not performing the duties specified herein,
and may accept fees and other consideration from Borrower for services in
connection herewith and otherwise without having to account for the same to
Lenders.

 

9.5.   Lenders’ Representations, Warranties and Acknowledgment.

 

(a)   Each Lender represents and warrants that it has made its own independent
investigation of the financial condition and affairs of Holdings and its
Subsidiaries in connection with Credit Extensions hereunder and that it has made
and shall continue to make its own appraisal of the creditworthiness of Holdings
and its Subsidiaries.  No Agent shall have any duty

 

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or responsibility, either initially or on a continuing basis, to make any such
investigation or any such appraisal on behalf of Lenders or to provide any
Lender with any credit or other information with respect thereto, whether coming
into its possession before the making of the Loans or at any time or times
thereafter, and no Agent shall have any responsibility with respect to the
accuracy of or the completeness of any information provided to Lenders.

 

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

 

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

 

9.7.   Successor Administrative Agent and Collateral Agent.  Administrative
Agent may resign at any time by giving thirty days’ prior written notice thereof
to Lenders and Borrower.  Upon any such notice of resignation, Requisite Lenders
shall have the right to appoint a successor Administrative Agent approved by
Borrower (which approval (i) shall not be unreasonably withheld or delayed and
(ii) shall not be required during the continuance of an Event of Default).  Upon
the acceptance of any appointment as Administrative Agent hereunder by a
successor Administrative Agent, that successor Administrative Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring Administrative Agent and the retiring Administrative
Agent shall promptly (i) transfer to such successor Administrative Agent all
sums, Securities and other items of Collateral held under the Collateral
Documents, together with all records and other documents necessary or
appropriate in connection with the performance of the duties of the successor
Administrative Agent under the Credit Documents, and (ii) execute and deliver to
such successor Administrative Agent such amendments to financing statements, and
take such other actions, as may be necessary or

 

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appropriate in connection with the assignment to such successor Administrative
Agent of the security interests created under the Collateral Documents,
whereupon such retiring Administrative Agent shall be discharged from its duties
and obligations hereunder.  If the Requisite Lenders have not appointed a
successor Administrative Agent, Administrative Agent shall have the right to
appoint a financial institution to act as Administrative Agent and/or Collateral
Agent hereunder and in any case, Administrative Agent’s resignation shall become
effective on the thirtieth day after such notice of resignation.  If neither the
Requisite Lenders nor Administrative Agent have appointed a successor
Administrative Agent, the Requisite Lenders shall be deemed to have succeeded to
and become vested with all the rights, powers, privileges and duties of the
retiring Administrative Agent; provided that, until a successor Administrative
Agent is so appointed by the Requisite Lenders or Administrative Agent,
(i) Administrative Agent, by notice to Borrower and the Requisite Lenders, shall
retain its role as Collateral Agent under any Collateral Document and (ii) the
resigning Administrative Agent shall deliver the Register to the Borrower on the
effective date of its resignation, the Borrower shall maintain such Register
until a successor Administrative Agent has been appointed, and promptly upon
appointment of a successor Administrative Agent, the Borrower shall deliver the
Register to such Person.  Except as provided in the immediately preceding
sentence, resignation of LCPI or its successor as Administrative Agent pursuant
to this Section shall also constitute the resignation of LCPI or its successor
as Collateral Agent, and any successor Administrative Agent appointed pursuant
to this Section shall, upon its acceptance of such appointment, become the
successor Collateral Agent for all purposes hereunder.  After any retiring
Administrative Agent’s resignation hereunder as Administrative Agent, the
provisions of this Section 9 shall inure to its benefit as to any actions taken
or omitted to be taken by it while it was Administrative Agent hereunder.  Any
successor Administrative Agent appointed pursuant to this Section shall, upon
its acceptance of such appointment, become the successor Collateral Agent for
all purposes hereunder.

 

9.8.   Collateral Documents and Guaranty.

 

(a)   Agents under Collateral Documents and Guaranty.  Each Secured Party hereby
further authorizes Administrative Agent or Collateral Agent, as applicable, on
behalf of and for the benefit of Secured Parties, to be the agent for and
representative of the Secured Parties with respect to the Guaranty, the
Intercreditor Agreement, the Collateral and the Collateral Documents.  Subject
to Section 10.5, without further written consent or authorization from any
Secured Party, Administrative Agent or Collateral Agent, as applicable may
execute any documents or instruments necessary to (i) in connection with a sale
or disposition of assets permitted by this Agreement, release any Lien
encumbering any item of Collateral that is the subject of such sale or other
disposition of assets or to which Requisite Lenders (or such other Lenders as
may be required to give such consent under Section 10.5) have otherwise
consented or (ii) release any Guarantor from the Guaranty pursuant to
Section 7.12 or with respect to which Requisite Lenders (or such other Lenders
as may be required to give such consent under Section 10.5) have otherwise
consented.

 

(b)   Right to Realize on Collateral and Enforce Guaranty.  Anything contained
in any of the Credit Documents to the contrary notwithstanding, Borrower,
Administrative Agent, Collateral Agent and each Secured Party hereby agree that
(i) no Secured Party shall have any right individually to realize upon any of
the Collateral or to enforce the Guaranty, it being

 

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understood and agreed that all powers, rights and remedies hereunder may be
exercised solely by Administrative Agent on behalf of the Secured Parties in
accordance with the terms hereof, and all powers, rights and remedies under the
Collateral Documents may be exercised solely by Collateral Agent, and (ii) in
the event of a foreclosure by Collateral Agent on any of the Collateral pursuant
to a public or private sale or other disposition, Collateral Agent or any Lender
may be the purchaser or licensor of any or all of such Collateral at any such
sale or other disposition and Collateral Agent, as agent for and representative
of Secured Parties (but not any Lender or Lenders in its or their respective
individual capacities unless Requisite Lenders shall otherwise agree in
writing), shall be entitled, for the purpose of bidding and making settlement or
payment of the purchase price for all or any portion of the Collateral sold at
any such public sale, to use and apply any of the Obligations as a credit on
account of the purchase price for any collateral payable by Collateral Agent at
such sale or other disposition.

 

9.9.   Withholding Taxes.  To the extent required by any applicable law,
Administrative Agent may withhold from any payment to any Lender an amount
equivalent to any applicable withholding tax.  If the Internal Revenue Service
or any other Governmental Authority asserts a claim that Administrative Agent
did not properly withhold tax from amounts paid to or for the account of any
Lender because the appropriate form was not delivered or was not properly
executed or because such Lender failed to notify Administrative Agent of a
change in circumstance which rendered the exemption from, or reduction of,
withholding tax ineffective or for any other reason, such Lender shall indemnify
Administrative Agent fully for all amounts paid, directly or indirectly, by
Administrative Agent as tax or otherwise, including any penalties or interest
and together with all expenses (including legal expenses, allocated internal
costs and out-of-pocket expenses) incurred.

 

SECTION 10.   MISCELLANEOUS

 

10.1.   Notices.

 

(a)   Notices Generally.  Any notice or other communication herein required or
permitted to be given to a Credit Party, Syndication Agent, Collateral Agent,
Administrative Agent or Documentation Agent shall be sent to such Person’s
address as set forth on Appendix B or in the other relevant Credit Document, and
in the case of any Lender, the address as indicated on Appendix B or otherwise
indicated to Administrative Agent in writing.  Except as otherwise set forth in
paragraph (b) below, each notice hereunder shall be in writing and may be
personally served, telexed or sent by telefacsimile or United States mail or
courier service and shall be deemed to have been given when delivered in person
or by courier service and signed for against receipt thereof, upon receipt of
telefacsimile or telex, or three Business Days after depositing it in the United
States mail with postage prepaid and properly addressed; provided, no notice to
any Agent shall be effective until received by such Agent; provided further, any
such notice or other communication shall at the request of Administrative Agent
be provided to any sub-agent appointed pursuant to Section 9.3(c) hereto as
designated by Administrative Agent from time to time.

 

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(b)   Electronic Communications.

 

(i)   Notices and other communications to the Lenders hereunder may be delivered
or furnished by electronic communication (including e-mail and Internet or
intranet websites, including the Platform) pursuant to procedures approved by
Administrative Agent, provided that the foregoing shall not apply to notices to
any Lender pursuant to Section 2 if such Lender, as applicable, has notified
Administrative Agent that it is incapable of receiving notices under such
Section by electronic communication.  Administrative Agent or 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.  Unless Administrative Agent otherwise prescribes, (i) notices
and other communications sent to an e-mail address shall be deemed received upon
the sender’s receipt of an acknowledgement from the intended recipient (such as
by the “return receipt requested” function, as available, return e-mail or other
written acknowledgement), provided that if such notice or other communication is
not sent during the normal business hours of the recipient, such notice or
communication shall be deemed to have been sent at the opening of business on
the next Business Day for the recipient, and (ii) notices or communications
posted to an Internet or intranet website shall be deemed received upon the
deemed receipt by the intended recipient at its e-mail address as described in
the foregoing clause (i) of notification that such notice or communication is
available and identifying the website address therefor.

 

(ii)   Each of the Credit Parties understands that the distribution of material
through an electronic medium is not necessarily secure and that there are
confidentiality and other risks associated with such distribution and agrees and
assumes the risks associated with such electronic distribution, except to the
extent caused by the willful misconduct, bad faith or gross negligence of
Administrative Agent, as determined by a final, non-appealable judgment of a
court of competent jurisdiction.

 

(iii)   The Platform and any Approved Electronic Communications are provided “as
is” and “as available”.  None of the Agents or any of their respective officers,
directors, employees, agents, advisors or representatives (the “Agent
Affiliates”) warrant the accuracy, adequacy, or completeness of the Approved
Electronic Communications or the Platform and each expressly disclaims liability
for errors or omissions in the Platform and the Approved Electronic
Communications.  No warranty of any kind, express, implied or statutory,
including any warranty of merchantability, fitness for a particular purpose,
non-infringement of third party rights or freedom from viruses or other code
defects is made by the Agent Affiliates in connection with the Platform or the
Approved Electronic Communications.

 

(iv)   Each of the Credit Parties, the Lenders and the Agents agree that
Administrative Agent may, but shall not be obligated to, store any Approved
Electronic Communications on the Platform in accordance with Administrative
Agent’s customary document retention procedures and policies.

 

10.2.   Expenses.  On and after the Closing Date, Borrower agrees to pay
promptly (a) all the actual and reasonable out-of-pocket costs and expenses of
preparation of the Credit Documents and any consents, amendments, waivers or
other modifications thereto; (b) all the

 

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reasonable out-of-pocket costs of furnishing all opinions by counsel for
Borrower and the other Credit Parties; (c) the reasonable fees, reasonable
out-of-pocket expenses and reasonable disbursements of one counsel to Agents and
Lenders in connection with the negotiation, preparation, execution and
administration of the Credit Documents and any consents, amendments, waivers or
other modifications thereto and any other documents or matters requested by
Borrower; provided that, reasonable attorney’s fees shall be limited to one
primary counsel and, if reasonably required by Administrative Agent, one local
or specialist counsel for Agent and Lenders in each relevant jurisdiction,
provided further that if counsel for Administrative Agent determines in good
faith that there is an actual or potential conflict of interest that requires
separate representation for the Agents, Borrower shall be required to pay for
one additional counsel for all such Agents taken as a whole; (d) all the actual
and reasonable out-of-pocket costs and reasonable out-of-pocket expenses of
creating, perfecting and recording Liens in favor of Collateral Agent, for the
benefit of the Secured Parties, including filing and recording fees, expenses
and taxes, stamp or documentary taxes, search fees, title insurance premiums and
reasonable fees, reasonable out-of-pocket expenses and reasonable disbursements
of one counsel to Collateral Agent and Secured Parties and of counsel providing
any opinions that any Agent or Requisite Lenders may reasonably request in
respect of the Collateral or the Liens created pursuant to the Collateral
Documents; (e) all the actual and reasonable out-of-pocket costs and reasonable
fees, reasonable out-of-pocket expenses and reasonable disbursements of any
auditors, accountants, consultants or appraisers; (f) all the actual and
reasonable costs and reasonable out-of-pocket expenses (including the reasonable
fees, reasonable out-of-pocket expenses and reasonable disbursements of any
appraisers, consultants, advisors and agents employed or retained by Collateral
Agent and its counsel in accordance with the terms of the Credit Documents) in
connection with the custody or preservation of any of the Collateral; (g) all
other actual and reasonable out-of-pocket costs and reasonable out-of-pocket
expenses incurred by each Agent in connection with the syndication of the Loans
and the negotiation, preparation and execution of the Credit Documents and any
consents, amendments, waivers or other modifications thereto and the
transactions contemplated thereby; and (h) after the occurrence of a Default or
an Event of Default, all reasonable out-of-pocket costs and reasonable
out-of-pocket expenses, including reasonable attorneys’ fees for one counsel for
Agents and Lenders (unless either (i) the Administrative Agent determines in
good faith that there is an actual or potential conflict of interest that
requires separate representation for the Agents or (ii) the Lenders, or any of
them, requests separate counsel, in which case, Borrower shall be required to
pay for one additional counsel for all such Agents and all such requesting
Lenders, taken as a whole) and costs of settlement, incurred by any Agent and
Lenders in enforcing any Obligations of or in collecting any payments due from
any Credit Party hereunder or under the other Credit Documents by reason of such
Default or Event of Default (including in connection with the sale, lease or
license of, collection from, or other realization upon any of the Collateral or
the enforcement of the Guaranty) or in connection with any refinancing or
restructuring of the credit arrangements provided hereunder in the nature of a
“work-out” or pursuant to any insolvency or bankruptcy cases or proceedings.

 

10.3.   Indemnity.

 

(a)   In addition to the payment of expenses pursuant to Section 10.2, on and
after the Closing Date, each Credit Party agrees to defend (subject to
Indemnitees’ selection of counsel), indemnify, pay and hold harmless, each
Agent, Arranger and Lender and the officers,

 

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partners, members, directors, trustees, advisors, employees, agents, sub-agents
and Affiliates of each Agent, Arranger and Lender (each, an “Indemnitee”), from
and against any and all Indemnified Liabilities; provided, no Credit Party shall
have any obligation to any Indemnitee hereunder with respect to any Indemnified
Liabilities (i) to the extent such Indemnified Liabilities arise from the gross
negligence, bad faith or willful misconduct of that Indemnitee or its employees,
agents, directors or affiliates or (ii) to the extent such Indemnified
Liabilities arise out of or are in connection with any claim, litigation, loss
or proceeding not involving a Credit Party or any of its Subsidiaries or
Affiliates and that is brought by an Indemnitee against another Indemnitee
(other than against any Arranger or Administrative Agent in their capacities as
such), in each case, as determined by a final, non-appealable judgment of a
court of competent jurisdiction.  To the extent that the undertakings to defend,
indemnify, pay and hold harmless set forth in this Section 10.3 may be
unenforceable in whole or in part because they are violative of any law or
public policy, the applicable Credit Party shall contribute the maximum portion
that it is permitted to pay and satisfy under applicable law to the payment and
satisfaction of all Indemnified Liabilities incurred by Indemnitees or any of
them.

 

(b)   To the extent permitted by applicable law, no Credit Party shall assert,
and each Credit Party hereby waives, any claim against each Lender, each Agent
and their respective Affiliates, directors, employees, attorneys, agents or
sub-agents, on any theory of liability, for special, indirect, consequential or
punitive damages (as opposed to direct or actual damages) (whether or not the
claim therefor is based on contract, tort or duty imposed by any applicable
legal requirement) arising out of, in connection with, arising out of, as a
result of, or in any way related to, this Agreement or any Credit Document or
any agreement or instrument contemplated hereby or thereby or referred to herein
or therein, the transactions contemplated hereby or thereby, any Loan or the use
of the proceeds thereof or any act or omission or event occurring in connection
therewith, and Holdings and Borrower hereby waives, releases and agrees not to
sue upon any such claim or any such damages, whether or not accrued and whether
or not known or suspected to exist in its favor.

 

10.4.   Set-Off.  Subject to the terms of the Intercreditor Agreement, in
addition to any rights now or hereafter granted under applicable law and not by
way of limitation of any such rights, upon the occurrence and continuance of any
Event of Default, each Lender is hereby authorized by each Credit Party at any
time or from time to time subject to the consent of Administrative Agent (such
consent not to be unreasonably withheld or delayed), without notice to any
Credit Party or to any other Person (other than Administrative Agent), any such
notice being hereby expressly waived, to set off and to appropriate and to apply
any and all deposits (general or special, including Indebtedness evidenced by
certificates of deposit, whether matured or unmatured, but not including trust
accounts) and any other Indebtedness at any time held or owing by such Lender to
or for the credit or the account of any Credit Party against and on account of
the obligations and liabilities of any Credit Party to such Lender hereunder and
under the other Credit Documents, including all claims of any nature or
description arising out of or connected hereto or with any other Credit
Document, irrespective of whether or not (a) such Lender shall have made any
demand hereunder or (b) the principal of or the interest on the Loans or any
other amounts due hereunder shall have become due and payable pursuant to
Section 2 and although such obligations and liabilities, or any of them, may be
contingent or unmatured.

 

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10.5.   Amendments and Waivers.

 

(a)   Requisite Lenders’ Consent.  Subject to the additional requirements of
Sections 10.5(b) and 10.5(c), no amendment, modification, termination or waiver
of any provision of the Credit Documents, or consent to any departure by any
Credit Party therefrom, shall in any event be effective without the written
concurrence of the Requisite Lenders; provided that Administrative Agent may,
with the consent of Borrower only, amend, modify or supplement this Agreement to
cure any ambiguity, omission, defect or inconsistency, so long as such
amendment, modification or supplement does not materially and adversely affect
the rights of any Lender.

 

(b)   Affected Lenders’ Consent.  Without the written consent of each Lender
that would be directly affected thereby, no amendment, modification,
termination, or consent shall be effective if the effect thereof would:

 

(i)   extend the scheduled final maturity of any Loan or Note;

 

(ii)   waive, reduce or postpone any scheduled repayment (but not prepayment);

 

(iii)   reserved;

 

(iv)   reduce the rate of interest on any Loan (other than any waiver of any
increase in the interest rate applicable to any Loan pursuant to Section 2.10)
or any fee or any premium payable hereunder;

 

(v)   extend the time for payment of any such interest or fees;

 

(vi)   reduce the principal amount of any Loan;

 

(vii)   amend, modify, terminate or waive any provision of Section 2.13(b)(ii),
this Section 10.5(b), Section 10.5(c) or any other provision of this Agreement
that expressly provides that the consent of all Lenders is required;

 

(viii)   amend the definition of “Requisite Lenders” or “Pro Rata Share”;
provided, that with the consent of Requisite Lenders (excluding any Lenders who
will no longer be Lenders following the borrowing and use of proceeds of the
additional extensions of credit), additional extensions of credit pursuant
hereto may be included in the determination of “Requisite Lenders” or “Pro Rata
Share” on substantially the same basis as the Commitments and the Loans are
included on the Closing Date;

 

(ix)   release all or substantially all of the Collateral or all or
substantially all of the Guarantors from the Guaranty except as expressly
provided in the Credit Documents; or

 

(x)   consent to the assignment or transfer by any Credit Party of any of its
rights and obligations under any Credit Document.

 

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(c)   Other Consents.  No amendment, modification, termination or waiver of any
provision of the Credit Documents, or consent to any departure by any Credit
Party therefrom, shall:

 

(i)   amend, modify, terminate or waive any provision of Section 9 as the same
applies to any Agent, or any other provision hereof as the same applies to the
rights or obligations of any Agent, in each case without the consent of such
Agent; or

 

(ii)   amend or modify the definition of “Change of Control” or waive any Event
of Default under Section 8.1(k) without the written consent of the Requisite
Supermajority Lenders.

 

(d)   Execution of Amendments, etc.  Administrative Agent may, but shall have no
obligation to, with the concurrence of any Lender, execute amendments,
modifications, waivers or consents on behalf of such Lender.  Any waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which it was given.  No notice to or demand on any Credit Party in
any case shall entitle any Credit Party to any other or further notice or demand
in similar or other circumstances.  Any amendment, modification, termination,
waiver or consent effected in accordance with this Section 10.5 shall be binding
upon each Lender at the time outstanding, each future Lender and, if signed by a
Credit Party, on such Credit Party.

 

10.6.   Successors and Assigns; Participations.

 

(a)   Generally.  This Agreement shall be binding upon the parties hereto and
their respective successors and permitted assigns and shall inure to the benefit
of the parties hereto and the successors and permitted assigns of Lenders.  No
Credit Party’s rights or obligations hereunder nor any interest therein may be
assigned or delegated by any Credit Party without the prior written consent of
all Lenders.  Nothing in this Agreement, expressed or implied, shall be
construed to confer upon any Person (other than the parties hereto, their
respective successors and assigns permitted hereby and, to the extent expressly
contemplated hereby, Affiliates of each of the Agents and Lenders) any legal or
equitable right, remedy or claim under or by reason of this Agreement.

 

(b)   Register.  Borrower, Administrative Agent and Lenders shall deem and treat
the Persons listed as Lenders in the Register as the holders and owners of the
corresponding Loans listed therein for all purposes hereof, and no assignment or
transfer of any such Loan shall be effective, in each case, unless and until
recorded in the Register following receipt of an Assignment Agreement effecting
the assignment or transfer thereof, together with the required forms and
certificates regarding tax matters and any fees payable in connection with such
assignment, in each case, as provided in Section 10.6(d).  Each assignment shall
be recorded in the Register on the Business Day the Assignment Agreement is
received by Administrative Agent, if received by 12:00 noon New York City time,
and on the following Business Day if received after such time, prompt notice
thereof shall be provided to Borrower and a copy of such Assignment Agreement
shall be maintained, as applicable.  The date of such recordation of a transfer
shall be referred to herein as the “Assignment Effective Date.”  Any request,
authority or consent of any Person who, at the time of making such request or
giving such authority or

 

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consent, is listed in the Register as a Lender shall be conclusive and binding
on any subsequent holder, assignee or transferee of the corresponding Loans.

 

(c)   Right to Assign.  Each Lender shall have the right at any time to sell,
assign or transfer all or a portion of its rights and obligations under this
Agreement, including all or a portion of its Loans owing to it or other
Obligations (provided, however, that pro rata assignments shall not be required
and each assignment shall be of a uniform, and not varying, percentage of all
rights and obligations under and in respect of any applicable Loan):

 

(i)   to any Person meeting the criteria of clause (i) of the definition of the
term “Eligible Assignee”; and

 

(ii)   to any Person meeting the criteria of clause (ii) of the definition of
the term “Eligible Assignee”; provided, each such assignment pursuant to this
Section 10.6(c)(ii) shall be in an aggregate amount of not less than $1,000,000
(or such lesser amount as may be agreed to by Borrower and Administrative Agent
or as shall constitute the aggregate amount of the Loans of the assigning
Lender).

 

(d)   Mechanics.  Assignments and assumptions of Loans by Lenders shall be
effected by manual execution and delivery to Administrative Agent of an
Assignment Agreement.  Assignments made pursuant to the foregoing provision
shall be effective as of the Assignment Effective Date.  In connection with all
assignments there shall be delivered to Administrative Agent such forms,
certificates or other evidence, if any, with respect to United States federal
income tax withholding matters as the assignee under such Assignment Agreement
may be required to deliver pursuant to Section 2.20(c), together with payment to
Administrative Agent of a registration and processing fee of $3,500 (except that
no such registration and processing fee shall be payable (y) in connection with
an assignment by or to GSCP or any Affiliate thereof or (z) in the case of an
Assignee which is already a Lender or is an affiliate or Related Fund of a
Lender or a Person under common management with a Lender).

 

(e)   Representations and Warranties of Assignee.  Each Lender, upon execution
and delivery hereof or upon succeeding to an interest in the Loans represents
and warrants as of the Closing Date or as of the Assignment Effective Date that
(i) it is an Eligible Assignee; (ii) it has experience and expertise in the
making of or investing in commitments or loans such as the Loans; and (iii) it
will make or invest in its Loans for its own account in the ordinary course and
without a view to distribution of such Loans in violation of the Securities Act
or the Exchange Act or other federal securities laws (it being understood that,
subject to the provisions of this Section 10.6, the disposition of such Loans or
any interests therein shall at all times remain within its exclusive control).

 

(f)   Effect of Assignment.  Subject to the terms and conditions of this
Section 10.6, as of the “Assignment Effective Date” (i) the assignee thereunder
shall have the rights and obligations of a “Lender” hereunder to the extent of
its interest in the Loans as reflected in the Register and shall thereafter be a
party hereto and a “Lender” for all purposes hereof; (ii) the assigning Lender
thereunder shall, to the extent that rights and obligations hereunder have been
assigned to the assignee, relinquish its rights (other than any rights which
survive the termination hereof under Section 10.8) and be released from its
obligations hereunder (and, in the case of an

 

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assignment covering all or the remaining portion of an assigning Lender’s rights
and obligations hereunder, such Lender shall cease to be a party hereto on the
Assignment Effective Date; provided, anything contained in any of the Credit
Documents to the contrary notwithstanding, such assigning Lender shall continue
to be entitled to the benefit of all indemnities hereunder as specified herein
with respect to matters arising out of the prior involvement of such assigning
Lender as a Lender hereunder); and (iii) if any such assignment occurs after the
issuance of any Note hereunder, the assigning Lender shall, upon the
effectiveness of such assignment or as promptly thereafter as practicable,
surrender its applicable Notes to Administrative Agent for cancellation, and
thereupon Borrower shall issue and deliver new Notes, if so requested by the
assignee and/or assigning Lender, to such assignee and/or to such assigning
Lender, with appropriate insertions, to reflect the outstanding Loans of the
assignee and/or the assigning Lender.

 

(g)   Participations.

 

(i)   Each Lender shall have the right at any time to sell one or more
participations to any Person (other than Holdings, any of its Subsidiaries or
any of its Affiliates) in all or any part of its Loans or in any other
Obligation.

 

(ii)    The holder of any such participation, other than an Affiliate of the
Lender granting such participation, shall not be entitled to require such Lender
to take or omit to take any action hereunder except with respect to any
amendment, modification or waiver that would (A) extend the final scheduled
maturity of any Loan or Note in which such participant is participating, or
reduce the rate or extend the time of payment of interest or fees thereon
(except in connection with a waiver of applicability of any post-default
increase in interest rates (it being understood that any change to the component
definitions of the Leverage Ratio affecting the determination of interest shall
not require the consent of such participant)) or reduce the principal amount
thereof, or increase the amount of the participant’s participation over the
amount thereof then in effect (it being understood that a waiver of any Default
or Event of Default shall not constitute a change in the terms of such
participation, and that an increase in any Loan shall be permitted without the
consent of any participant if the participant’s participation is not increased
as a result thereof), (B) consent to the assignment or transfer by any Credit
Party of any of its rights and obligations under this Agreement or (C) release
all or substantially all of the Collateral under the Collateral Documents
(except as expressly provided in the Credit Documents) supporting the Loans
hereunder in which such participant is participating. Notwithstanding the
foregoing, any bank that is a member of the Farm Credit System that (A) has
purchased a participation in the minimum amount of $10,000,000, (B) has been
designated by written notice to Administrative Agent as being entitled to be
accorded the right of a voting participant, and (C) receives the prior consent
of Administrative Agent to become a voting participant, shall be entitled to
vote, and the voting rights of the selling Lender shall be correspondingly
reduced, on a dollar-for-dollar basis, as if such participant were a Lender, on
any matter requiring or allowing a Lender to provide or withhold its consent, or
to otherwise vote on any proposed action.

 

(iii)     Borrower agrees that each participant shall be entitled to the
benefits of Sections 2.18(c), 2.19 and 2.20 to the same extent as if it were a
Lender and

 

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had acquired its interest by assignment pursuant to paragraph (c) of this
Section; provided, (x) a participant shall not be entitled to receive any
greater payment under Section 2.19 or 2.20 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 Borrower’s prior written consent and (y) a participant that would be a
Non-US Lender if it were a Lender shall not be entitled to the benefits of
Section 2.20 unless Borrower is notified of the participation sold to such
participant and such participant agrees, for the benefit of Borrower, to comply
with Section 2.20 as though it were a Lender; provided further that, except as
specifically set forth in clauses (x) and (y) of this sentence, nothing herein
shall require any notice to Borrower or any other Person in connection with the
sale of any participation.  To the extent permitted by law, each participant
also shall be entitled to the benefits of Section 10.4 as though it were a
Lender, provided such participant agrees to be subject to Section 2.17 as though
it were a Lender.

 

(h)   Certain Other Assignments and Participations.  In addition to any other
assignment or participation permitted pursuant to this Section 10.6, any Lender
may assign and/or pledge all or any portion of its Loans, the other Obligations
owed by or to such Lender, and its Notes, if any, to secure obligations of such
Lender including, without limitation, any Federal Reserve Bank as collateral
security pursuant to Regulation A of the Board of Governors and any operating
circular issued by such Federal Reserve Bank; provided, that no Lender, as
between Borrower and such Lender, shall be relieved of any of its obligations
hereunder as a result of any such assignment and pledge, and provided further,
that in no event shall the applicable Federal Reserve Bank or other pledgee be
considered to be a “Lender” or be entitled to require the assigning Lender to
take or omit to take any action hereunder.

 

(i)   In connection with an additional extension of credit as described in
Section 10.5(b)(viii), the Borrower shall have the option, with the consent of
the Administrative Agent and subject to at least three Business Days’ advance
notice to the Lenders who will no longer be Lenders following the borrowing and
use of proceeds of such additional extensions of credit, instead of prepaying
the Loans, to (i) require such Lenders to assign such Loans to the
Administrative Agent or its designees and (ii) amend the terms thereof in
accordance with Section 10.5 (with such amendment, if applicable, being deemed
to have been made pursuant to Section 10.5(b)(viii)).  Pursuant to any such
assignment, all Loans to be assigned shall be purchased at par (allocated among
the applicable Lenders in the same manner as would be required if such Loans
were being optionally prepaid), accompanied by payment of any accrued interest
and fees thereon and any amounts owing pursuant to Section 2.18(c).  By
receiving such purchase price, such Lenders shall automatically be deemed to
have assigned the Loans of such Lenders pursuant to the terms of an Assignment
Agreement, and accordingly no other action by such Lenders shall be required in
connection therewith.  The provisions of this paragraph are intended to
facilitate the maintenance of the perfection and priority of existing security
interests in the Collateral during any such replacement.

 

10.7.   Independence of Covenants.  All covenants hereunder shall be given
independent effect so that if a particular action or condition is not permitted
by any of such covenants, the fact that it would be permitted by an exception
to, or would otherwise be within

 

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the limitations of, another covenant shall not avoid the occurrence of a Default
or an Event of Default if such action is taken or condition exists.

 

10.8.   Survival of Representations, Warranties and Agreements.  All
representations, warranties and agreements made herein shall survive the
execution and delivery hereof and the making of any Credit Extension. 
Notwithstanding anything herein or implied by law to the contrary, the
agreements of each Credit Party set forth in Sections 2.18(c), 2.19, 2.20, 10.2,
10.3 and 10.4 and the agreements of Lenders set forth in Sections 2.17, 9.3(b)
and 9.6 shall survive the payment of the Loans and the termination hereof.

 

10.9.   No Waiver; Remedies Cumulative.  No failure or delay on the part of any
Agent or any Lender in the exercise of any power, right or privilege hereunder
or under any other Credit Document shall impair such power, right or privilege
or be construed to be a waiver of any default or acquiescence therein, nor shall
any single or partial exercise of any such power, right or privilege preclude
other or further exercise thereof or of any other power, right or privilege. 
The rights, powers and remedies given to each Agent and each Lender hereby are
cumulative and shall be in addition to and independent of all rights, powers and
remedies existing by virtue of any statute or rule of law or in any of the other
Credit Documents.  Any forbearance or failure to exercise, and any delay in
exercising, any right, power or remedy hereunder shall not impair any such
right, power or remedy or be construed to be a waiver thereof, nor shall it
preclude the further exercise of any such right, power or remedy.

 

10.10.   Marshalling; Payments Set Aside.  Neither any Agent nor any Lender
shall be under any obligation to marshal any assets in favor of any Credit Party
or any other Person or against or in payment of any or all of the Obligations. 
To the extent that any Credit Party makes a payment or payments to
Administrative Agent or Lenders (or to Administrative Agent, on behalf of
Lenders), or any Agent or Lenders enforce any security interests or exercise
their rights of setoff, and such payment or payments or the proceeds of such
enforcement or setoff or any part thereof are subsequently invalidated, declared
to be fraudulent or preferential, set aside and/or required to be repaid to a
trustee, receiver or any other party under any bankruptcy law, any other state
or federal law, common law or any equitable cause, then, to the extent of such
recovery, the obligation or part thereof originally intended to be satisfied,
and all Liens, rights and remedies therefor or related thereto, shall be revived
and continued in full force and effect as if such payment or payments had not
been made or such enforcement or setoff had not occurred.

 

10.11.   Severability.  In case any provision in or obligation hereunder or
under any other Credit Document shall be invalid, illegal or unenforceable in
any jurisdiction, the validity, legality and enforceability of the remaining
provisions or obligations, or of such provision or obligation in any other
jurisdiction, shall not in any way be affected or impaired thereby.

 

10.12.   Obligations Several; Independent Nature of Lenders’ Rights.  The
obligations of Lenders hereunder are several and no Lender shall be responsible
for the obligations of any other Lender hereunder.  Nothing contained herein or
in any other Credit Document, and no action taken by Lenders pursuant hereto or
thereto, shall be deemed to constitute Lenders as a partnership, an association,
a joint venture or any other kind of entity. The amounts payable at any time
hereunder to each Lender shall be a separate and independent debt, and each
Lender shall be entitled to protect and enforce its rights arising out hereof
and it

 

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shall not be necessary for any other Lender to be joined as an additional party
in any proceeding for such purpose.

 

10.13.   Headings.  Section headings herein are included herein for convenience
of reference only and shall not constitute a part hereof for any other purpose
or be given any substantive effect.

 

10.14.   APPLICABLE LAW.  THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF
LAWS PRINCIPLES THEREOF.

 

10.15.   CONSENT TO JURISDICTION.  ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST ANY
PARTY HERETO ARISING OUT OF OR RELATING HERETO OR ANY OTHER CREDIT DOCUMENT, OR
ANY OF THE OBLIGATIONS, MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF
COMPETENT JURISDICTION IN THE STATE, COUNTY AND CITY OF NEW YORK.  BY EXECUTING
AND DELIVERING THIS AGREEMENT, EACH PARTY HERETO, FOR ITSELF AND IN CONNECTION
WITH ITS PROPERTIES, IRREVOCABLY (A) ACCEPTS GENERALLY AND UNCONDITIONALLY THE
NONEXCLUSIVE JURISDICTION AND VENUE OF SUCH COURTS; (B) WAIVES ANY DEFENSE OF
FORUM NON CONVENIENS; (C) AGREES THAT SERVICE OF ALL PROCESS IN ANY SUCH
PROCEEDING IN ANY SUCH COURT MAY BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN
RECEIPT REQUESTED, TO THE APPLICABLE PARTY HERETO AT ITS ADDRESS PROVIDED IN
ACCORDANCE WITH SECTION 10.1; (D) AGREES THAT SERVICE AS PROVIDED IN CLAUSE
(C) ABOVE IS SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER THE APPLICABLE
PARTY HERETO IN ANY SUCH PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES
EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT; AND (E) AGREES THAT ANY PARTY
HERETO RETAINS THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW
OR TO BRING PROCEEDINGS AGAINST ANY OTHER PARTY HERETO IN THE COURTS OF ANY
OTHER JURISDICTION.

 

10.16.   WAIVER OF JURY TRIAL.  EACH OF THE PARTIES HERETO HEREBY AGREES TO
WAIVE ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION
BASED UPON OR ARISING HEREUNDER OR UNDER ANY OF THE OTHER CREDIT DOCUMENTS OR
ANY DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS LOAN
TRANSACTION OR THE LENDER/BORROWER RELATIONSHIP THAT IS BEING ESTABLISHED.  THE
SCOPE OF THIS WAIVER IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES
THAT MAY BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS
TRANSACTION, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS AND
ALL OTHER COMMON LAW AND STATUTORY CLAIMS.  EACH PARTY HERETO ACKNOWLEDGES THAT
THIS WAIVER IS A MATERIAL

 

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INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS ALREADY RELIED
ON THIS WAIVER IN ENTERING INTO THIS AGREEMENT, AND THAT EACH WILL CONTINUE TO
RELY ON THIS WAIVER IN ITS RELATED FUTURE DEALINGS.  EACH PARTY HERETO FURTHER
WARRANTS AND REPRESENTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL
AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING
CONSULTATION WITH LEGAL COUNSEL.  THIS WAIVER IS IRREVOCABLE, MEANING THAT IT
MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN
WAIVER SPECIFICALLY REFERRING TO THIS SECTION 10.16 AND EXECUTED BY EACH OF THE
PARTIES HERETO), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS HERETO OR ANY OF THE OTHER CREDIT
DOCUMENTS OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE LOANS MADE
HEREUNDER.  IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN
CONSENT TO A TRIAL BY THE COURT.

 

10.17.   Confidentiality.  Each Agent and each Lender shall hold all non-public
information regarding Holdings and its Subsidiaries and their businesses
identified as such by Borrower and obtained by such Agent or such Lender
pursuant to the requirements hereof in accordance with such Agent’s and such
Lender’s customary procedures for handling confidential information of such
nature, it being understood and agreed by Borrower that, in any event,
Administrative Agent may disclose such information to the Lenders and each Agent
and each Lender may make (i) disclosures of such information to Affiliates of
such Lender or Agent and to their respective agents and advisors (and to other
Persons authorized by a Lender or Agent to organize, present or disseminate such
information in connection with disclosures otherwise made in accordance with
this Section 10.17), (ii) disclosures of such information reasonably required by
any bona fide or potential assignee, transferee or participant in connection
with the contemplated assignment, transfer or participation of any Loans or any
participations therein or by any direct or indirect contractual counterparties
(or the professional advisors thereto) to any swap or derivative transaction
relating to Borrower and its obligations (provided, such assignees, transferees,
participants, counterparties and advisors are advised of and agree to be bound
by either the provisions of this Section 10.17 or other provisions at least as
restrictive as this Section 10.17), (iii) disclosure to any rating agency when
required by it, provided that, prior to any disclosure, such rating agency shall
undertake in writing to preserve the confidentiality of any confidential
information relating to the Credit Parties received by it from any of the Agents
or any Lender, (iv) disclosures in connection with the exercise of any remedies
hereunder or under any other Credit Document and (v) disclosures required or
requested by any governmental agency or representative thereof or by the NAIC or
pursuant to legal or judicial process; provided, unless specifically prohibited
by applicable law or court order, each Lender and each Agent shall make
reasonable efforts to notify Borrower of any request by any governmental agency
or representative thereof (other than any such request in connection with any
examination of the financial condition or other routine examination of such
Lender by such governmental agency) for disclosure of any such non-public
information prior to disclosure of such information.  In addition, each Agent
and each Lender may disclose the existence of this Agreement and the information
about this Agreement to market data collectors, similar services providers to
the lending industry, and service providers to the Agents and the Lenders in

 

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connection with the administration and management of this Agreement and the
other Credit Documents.

 

10.18.   Usury Savings Clause.  Notwithstanding any other provision herein, the
aggregate interest rate charged with respect to any of the Obligations,
including all charges or fees in connection therewith deemed in the nature of
interest under applicable law shall not exceed the Highest Lawful Rate.  If the
rate of interest (determined without regard to the preceding sentence) under
this Agreement at any time exceeds the Highest Lawful Rate, the outstanding
amount of the Loans made hereunder shall bear interest at the Highest Lawful
Rate until the total amount of interest due hereunder equals the amount of
interest which would have been due hereunder if the stated rates of interest set
forth in this Agreement had at all times been in effect.  In addition, if when
the Loans made hereunder are repaid in full the total interest due hereunder
(taking into account the increase provided for above) is less than the total
amount of interest which would have been due hereunder if the stated rates of
interest set forth in this Agreement had at all times been in effect, then to
the extent permitted by law, Borrower shall pay to Administrative Agent an
amount equal to the difference between the amount of interest paid and the
amount of interest which would have been paid if the Highest Lawful Rate had at
all times been in effect.  Notwithstanding the foregoing, it is the intention of
Lenders and Borrower to conform strictly to any applicable usury laws. 
Accordingly, if any Lender contracts for, charges, or receives any consideration
which constitutes interest in excess of the Highest Lawful Rate, then any such
excess shall be cancelled automatically and, if previously paid, shall at such
Lender’s option be applied to the outstanding amount of the Loans made hereunder
or be refunded to Borrower.

 

10.19.   Counterparts.  This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be deemed an
original, but all such counterparts together shall constitute but one and the
same instrument.  Delivery of an executed signature page to this Agreement by
facsimile or electronic transmission (in pdf format) shall be as effective as
delivery of a manually signed counterpart of this Agreement.

 

10.20.   Effectiveness; Entire Agreement.  This Agreement shall become effective
upon the execution of a counterpart hereof by each of the parties hereto and
receipt by Borrower and Administrative Agent of written or telephonic
notification of such execution and authorization of delivery thereof.  With the
exception of those terms contained in the Amended and Restated Commitment
Letter, dated November 2, 2007, among GSCP, Lehman Brothers, LCPI and Aldabra
which by the terms of the Commitment Letter remain in full force and effect, all
of GSCP’s, Lehman Brothers’, LCPI’s, Aldabra’s and their respective Affiliates’
obligations under the Commitment Letter shall terminate and be superseded by the
Credit Documents and GSCP, Lehman Brothers, LCPI, Aldabra and their respective
Affiliates shall be released from all liability in connection therewith,
including, without limitation, any claim for injury or damages, whether
consequential, special, direct, indirect, punitive or otherwise.

 

10.21.   Patriot Act.  Each Lender and Administrative Agent (for itself and not
on behalf of any Lender) hereby notifies each Credit Party that pursuant to the
requirements of the Patriot Act, it is required to obtain, verify and record
information that identifies each Credit Party, which information includes the
name and address of each Credit Party and other information that will

 

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allow such Lender or Administrative Agent, as applicable, to identify such
Credit Party in accordance with the Patriot Act.

 

10.22.   Electronic Execution of Assignments.  The words “execution,” “signed,”
“signature,” and words of like import in any Assignment Agreement shall be
deemed to include electronic signatures or the keeping of records in electronic
form, each of which shall be of the same legal effect, validity or
enforceability as a manually executed signature or the use of a paper-based
recordkeeping system, as the case may be, to the extent and as provided for in
any applicable law, including the Federal Electronic Signatures in Global and
National Commerce Act, the New York State Electronic Signatures and Records Act,
or any other similar state laws based on the Uniform Electronic Transactions
Act.

 

10.23.   No Fiduciary Duty.  Each Agent, each Arranger, each Lender and their
Affiliates (collectively, solely for purposes of this paragraph, the “Lenders”),
may have economic interests that conflict with those of Borrower.  Borrower
agrees that nothing in the Credit Documents or otherwise will be deemed to
create an advisory, fiduciary or agency relationship or fiduciary or other
implied duty between Lenders and Borrower, its stockholders or its affiliates. 
Borrower acknowledges and agrees that (i) the transactions contemplated by the
Credit Documents are arm’s-length commercial transactions between Lenders, on
the one hand, and Borrower, on the other, (ii) in connection therewith and with
the process leading to such transaction each of the Lenders is acting solely as
a principal and not the agent or fiduciary of Borrower, its management,
stockholders, creditors or any other person, (iii) no Lender has assumed an
advisory or fiduciary responsibility in favor of Borrower with respect to the
transactions contemplated hereby or the process leading thereto (irrespective of
whether any Lender or any of its affiliates has advised or is currently advising
Borrower on other matters) or any other obligation to Borrower except the
obligations expressly set forth in the Credit Documents and (iv) Borrower has
consulted its own legal and financial advisors to the extent it deemed
appropriate.  Borrower further acknowledges and agrees that it is responsible
for making its own independent judgment with respect to such transactions and
the process leading thereto.  Borrower agrees that it will not claim that any
Lender has rendered advisory services of any nature or respect, or owes a
fiduciary or similar duty to Borrower, in connection with such transaction or
the process leading thereto.

 

[Remainder of page intentionally left blank]

 

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

 

 

 

ALDABRA SUB LLC, as Borrower prior to the
BPH Merger

 

 

 

 

 

By:

/s/ Samuel K. Cotterell

 

 

Name: Samuel K. Cotterell

 

 

Title: Vice President

 

 

 

 

 

BOISE PAPER HOLDINGS, L.L.C., as
Borrower after the BPH Merger

 

 

 

 

 

By:

/s/ Samuel K. Cotterell

 

 

Name: Samuel K. Cotterell

 

 

Title: Vice President

 

 

 

 

 

ALDABRA HOLDING SUB LLC

 

 

 

 

 

By:

/s/ Samuel K. Cotterell

 

 

Name: Samuel K. Cotterell

 

 

Title: Vice President

 

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

 

 

BOISE WHITE PAPER, L.L.C.

 

BOISE PACKAGING & NEWSPRINT, L.L.C.

 

BOISE CASCADE TRANSPORTATION
HOLDINGS CORP.

 

BOISE WHITE PAPER SALES CORP.

 

BOISE WHITE PAPER HOLDINGS CORP.

 

INTERNATIONAL FALLS POWER
COMPANY

 

MINNESOTA, DAKOTA & WESTERN
RAILWAY COMPANY

 

BEMIS CORPORATION

 

BC CHINA CORPORATION

 

B C T, INC

 

 

 

 

 

By:

/s/ Samuel K. Cotterell

 

 

Name: Samuel K. Cotterell

 

 

Title: Vice President

 

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

 

 

GOLDMAN SACHS CREDIT PARTNERS L.P.,

 

as Syndication Agent and a Lender

 

 

 

 

 

By:

/s/ Tom Connolly

 

 

Authorized Signatory

 

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

 

 

LEHMAN COMMERCIAL PAPER INC.,

 

as Administrative Agent, Collateral Agent and

 

a Lender

 

 

 

 

 

By:

/s/ Laurie B. Perper

 

 

Name: Laurie B. Perper

 

 

Title: Managing Director

 

 

 

 

 

LEHMAN BROTHERS INC.,

 

as Documentation Agent

 

 

 

 

 

By:

/s/ Laurie B. Perper

 

 

Name: Laurie B. Perper

 

 

Title: Managing Director

 

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

 

APPENDIX A

TO SECOND LIEN CREDIT AND GUARANTY AGREEMENT

 

Commitments

 

Lender

 

Commitment

 

Pro
Rata Share

 

Goldman Sachs Credit Partners L.P.

 

$

260,700,000

 

100.0

%

Total

 

$

260,700,000

 

100.0

%

 

A-1

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APPENDIX B

TO SECOND LIEN CREDIT AND GUARANTY AGREEMENT

 

Notice Addresses

 

ALDABRA SUB LLC

BOISE PAPER HOLDINGS, L.L.C.

ALDABRA HOLDING SUB LLC

BOISE WHITE PAPER, L.L.C.

BOISE PACKAGING & NEWSPRINT, L.L.C.

BOISE CASCADE TRANSPORTATION HOLDINGS CORP.

BOISE WHITE PAPER SALES CORP.

BOISE WHITE PAPER HOLDINGS CORP.

INTERNATIONAL FALLS POWER COMPANY

MINNESOTA, DAKOTA & WESTERN RAILWAY COMPANY

BEMIS CORPORATION

BC CHINA CORPORATION

B C T, INC

 

c/o Boise Paper Holdings, L.L.C.

1111 West Jefferson Street

Suite 200

Boise, ID 83702-5388

Attention: Chief Financial Officer

Facsimile: (208) 384-4913

Email: RobMcNutt@BoiseInc.com

 

in each case, with a copy to:

 

c/o Boise Paper Holdings, L.L.C.

1111 West Jefferson Street

Suite 200

Boise, ID 83702-5388

Attention: General Counsel

Facsimile: (208) 384-7945

Email: Legal@BoiseInc.com

 

B-2

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GOLDMAN SACHS CREDIT PARTNERS L.P.,
as Syndication Agent and a Lender:

 

Goldman Sachs Credit Partners L.P.
c/o Goldman, Sachs & Co.
30 Hudson Street, 36th Floor
Jersey City, NJ 07302
Attention: SBD Operations
Attention:  Andrew Caditz
Telecopier:  (212) 428-1243 
Email: gsd.link@gs.com

 

with a copy to:

 

Goldman Sachs Credit Partners L.P.
1 New York Plaza
New York, New York  10004
Attention:  Rob Schatzman
Telecopier:  (212) 902-3000
Email: rwschatzman@am.ibd.gs.com

 

B-3

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LEHMAN COMMERCIAL PAPER INC.,

as Administrative Agent, Collateral Agent and a Lender:

Administrative Agent’s Principal Office:

 

LEHMAN COMMERCIAL PAPER INC.

745 Seventh Avenue

New York, New York 10019

Attention: Maritza Ospina

Facsimile: (646) 758-4648

Email: mospina@lehman.com

 

with a copy to:

 

Attention: Diane Albanese

Facsimile: (646) 758-5130

Email: diane.albanese@lehman.com

 

B-4

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

 

LEHMAN BROTHERS INC.,

as Documentation Agent

 

LEHMAN BROTHERS INC.

745 Seventh Avenue

New York, New York  10019

Attention: Maritza Ospina

Facsimile: (646) 758-4648

Email: mospina@lehman.com

 

with a copy to:

 

Attention: Diane Albanese

Facsimile: (646) 758-5130

Email: diane.albanese@lehman.com

 

B-5

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