Exhibit 10.16

AMENDED AND RESTATED PLEDGE AGREEMENT

AMENDED AND RESTATED PLEDGE AGREEMENT, dated as of March 24, 2010 (as amended,
supplemented, restated or otherwise modified from time to time, this
“Agreement”), made by WELLS TIMBERLAND OPERATING PARTNERSHIP, L.P., a Delaware
limited partnership (“Wells Partnership”), TIMBERLANDS II, LLC, a Delaware
limited liability company (“Wells Timberland”), WELLS TIMBERLAND TRS, INC., a
Delaware corporation (“Wells TRS”), WELLS TRS HARVESTING OPERATIONS, LLC, a
Delaware limited liability company (“Wells TRS Subsidiary”), WELLS TIMBERLAND
HBU, LLC, a Delaware limited liability company (“Wells HBU”) and each Additional
Grantor (such capitalized term and all other capitalized terms not otherwise
defined herein to have the meanings provided for in Article I) that may from
time to time become a party hereto (Wells Partnership, Wells Timberland, Wells
TRS, Wells TRS Subsidiary, Wells HBU and such Additional Grantors are
collectively referred to as the “Grantors” and individually as a “Grantor”), in
favor of COBANK, ACB, as administrative agent (in such capacity, the
“Administrative Agent”) for the benefit of itself and each other Lender Party.
This Agreement amends and restates in its entirety that certain Pledge
Agreement, dated as of October 9, 2007 (the “Original Pledge Agreement”), among
Wells TRS, Wells TRS Subsidiary and each other Grantor party thereto, in favor
of the Administrative Agent for the benefit of itself and each other Lender
Party.

W I T N E S S E T H:

WHEREAS, pursuant to the Amended and Restated Credit Agreement, dated as of the
date hereof (as amended, supplemented, restated or otherwise modified from time
to time, the “Credit Agreement”), among Wells Partnership, Wells Timberland (in
such capacity, each a “Borrower” and collectively, the “Borrowers”), the various
lending institutions as are, or may from time to time become, parties thereto
(collectively, the “Lenders”), and the Administrative Agent in its capacity as
administrative agent for the Lenders, the Lenders have extended Commitments to
make Loans to the Borrowers;

WHEREAS, as a condition precedent to the occurrence of the Funding Date under
the Credit Agreement, each Grantor is required to execute and deliver this
Agreement; and

WHEREAS, each Grantor has duly authorized the execution, delivery and
performance of this Agreement;

NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, and in order to induce the Lenders to make the
Loans to the Borrowers pursuant to the Credit Agreement, each Grantor agrees
with the Administrative Agent, for its benefit and the benefit of each other
Lender Party, to amend and restated the Original Pledge Agreement in its
entirety as follows:

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ARTICLE I

DEFINITIONS

SECTION 1.1 Certain Terms. The following terms (whether or not underscored) when
used in this Agreement, including its preamble and recitals, shall have the
following meanings (such definitions to be equally applicable to the singular
and plural forms thereof):

“Additional Grantors” is defined in clause (b) of Section 7.2.

“Administrative Agent” is defined in the preamble.

“Agreement” is defined in the preamble.

“Borrower” and “Borrowers” is defined in the preamble.

“Collateral” is defined in Section 2.1.

“Credit Agreement” is defined in the first recital.

“Grantor” and “Grantors” are defined in the preamble.

“Lenders” are defined in the first recital.

“LLC Agreement” is defined in clause (b)(A) of Section 2.1.

“Original Pledge Agreement” is defined in the preamble.

“Partnership Agreement” is defined in clause (b)(A) of Section 2.1.

“Pledge Agreement Supplement” is defined in clause (b) of Section 7.2.

“Pledged Equity Interests” means all Pledged Shares, Pledged Partnership
Interests and Pledged Membership Interests.

“Pledged Membership Interests” is defined in clause (b)(E) of Section 2.1.

“Pledged Partnership Interests” is defined in clause (b)(E) of Section 2.1.

“Pledged Shares” is defined in clause (a) of Section 2.1.

“Proceeds” has the meaning provided for in the U.C.C. and includes, without
limitation, (a) any and all proceeds of any insurance, indemnity, warranty or
guaranty payable to any Grantor from time to time with respect to any of the
Collateral, (b) any and all payments (in any form whatsoever) made or due and
payable to any Grantor from time to time in connection with any requisition,
confiscation, condemnation, seizure or forfeiture of all or any part of the
Collateral by any Governmental Authority, (c) any recoveries by any Grantor
against third parties with respect to any litigation or dispute concerning any
of the Collateral including claims arising out of the loss or nonconformity of,
interference with the use of, defects in, or

 

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infringement of rights in, or damage to, the Collateral, and (d) any and all
other amounts, rights to payment or other property acquired upon the sale,
lease, license, exchange or other disposition of the Collateral and all rights
arising out of the Collateral.

“Secured Obligations” is defined in Section 2.2.

“Securities Act” is defined in Section 6.2.

“Securities Issuer” means any Person listed on Schedule I attached hereto (as
such Schedule may be amended or supplemented from time to time) that has issued
or may issue a Pledged Equity Interest.

“U.C.C.” means the Uniform Commercial Code as in effect from time to time in the
State of New York; provided that if, by reason of applicable Law, the validity
or perfection or the effect of perfection or non-perfection or the priority of
any security interest in any Collateral granted under this Agreement is governed
by the Uniform Commercial Code as in effect in a jurisdiction other than New
York, then as to such matters “U.C.C.” shall mean the Uniform Commercial Code as
in effect in such other jurisdiction.

SECTION 1.2 Credit Agreement Definitions. Unless otherwise defined herein or the
context otherwise requires, terms used in this Agreement, including its preamble
and recitals, have the meanings provided in the Credit Agreement.

SECTION 1.3 U.C.C. Definitions. Unless otherwise defined herein or the context
otherwise requires, terms for which meanings are provided in the U.C.C. are used
in this Agreement, including its preamble and recitals, with such meanings.

ARTICLE II

PLEDGE

SECTION 2.1 Grant of Security Interest. Each Grantor hereby pledges,
hypothecates, collaterally assigns, charges, mortgages and pledges to the
Administrative Agent, for its benefit and the ratable benefit of each of the
other Lender Parties, and hereby grants to the Administrative Agent, for its
benefit and the ratable benefit of each of the other Lender Parties, a security
interest in, all of such Grantor’s right, title and interest in and to the
following, whether now or hereafter existing or acquired (collectively, the
“Collateral”):

(a) all issued and outstanding shares of capital stock of each Securities Issuer
identified in Item A of Schedule I attached hereto (as such Schedule may be
amended or supplemented from time to time) and all additional shares of capital
stock of Subsidiaries of the Grantors from time to time acquired by such Grantor
in any manner, the certificates representing such shares of capital stock (the
“Pledged Shares”), together with all options, warrants and other rights to
acquire additional shares of capital stock of each Securities Issuer and each
Subsidiary of the Grantors;

(b) (i) All Equity Interests in each Securities Issuer which is a limited
liability company identified in Item B of Schedule I attached hereto (as such
Schedule may be amended or supplemented from time to time) and all additional
Equity Interests in the same

 

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acquired from time to time by a Grantor, and (ii) all Equity Interests in each
Securities Issuer which is a partnership identified in Item C of Schedule I
attached hereto (as such Schedule may be amended or supplemented from time to
time) and all additional interests in the same acquired from time to time by a
Grantor, including, in the case of both (i) and (ii), (A) all rights (but not
obligations) of each applicable Grantor as a member or partner thereof, as the
case may be, pursuant to the applicable limited liability company agreement or
other related Organizational Document (collectively, the “LLC Agreement”),
partnership agreement or other related Organizational Document (collectively,
the “Partnership Agreement”) or otherwise, and all rights to receive
distributions, cash, instruments and other property and assets from time to time
received, receivable, or otherwise distributed thereunder, (B) all claims of
each Grantor for damages arising out of or for breach of or default under the
applicable LLC Agreement or Partnership Agreement, as the case may be, (C) the
right of each applicable Grantor to terminate the applicable LLC Agreement or
Partnership Agreement, as the case may be, to perform and exercise consensual or
voting rights thereunder, and to compel performance and otherwise exercise all
remedies thereunder, (D) all rights of each applicable Grantor, whether as a
member or partner thereof, as the case may be, or otherwise, to all property and
assets of the Securities Issuer (whether real property, inventory, equipment,
contract rights, accounts, receivables, general intangibles, securities,
instruments, chattel paper, documents, choses in action, or otherwise) and
(E) certificates or instruments evidencing an ownership, partnership or
membership interest in the applicable Securities Issuer or its assets (such
certificates or instruments being referred to herein, in the case of membership
interests, as the “Pledged Membership Interests” and, in the case of partnership
interests, as the “Pledged Partnership Interests”), together with all options,
warrants and other rights to acquire additional Pledged Membership Interests and
Pledged Partnership Interests;

(c) all dividends, distributions, interest and other payments and rights with
respect to any of the items listed in clauses (a), (b) and (c) above; and

(d) all Proceeds of any and all of the foregoing Collateral.

SECTION 2.2 Security for Obligations. This Agreement secures the prompt payment
in full in cash of all the Obligations, including all amounts payable by each
Borrower and each other Loan Party under or in connection with the Credit
Agreement, the Notes and each other Loan Document, whether for principal,
interest, costs, fees, expenses, indemnities or otherwise and whether now or
hereafter existing (all of such obligations being the “Secured Obligations”).

SECTION 2.3 Delivery of Collateral. All Pledged Equity Interests shall be
evidenced by a physical certificate. All such certificates and all other
certificates or instruments representing or evidencing any Collateral shall be
delivered to and held by or on behalf of the Administrative Agent pursuant
hereto, shall be in suitable form for transfer by delivery and shall be
accompanied by all necessary instruments of transfer or assignment, duly
executed in blank.

SECTION 2.4 Voting Rights; Dividends, Distributions and Payments. (a) In the
event that any dividend or distribution is to be paid on any Pledged Equity
Interest at a time when an Event of Default has not occurred and is continuing,
such dividend, distribution or payment may, subject to the terms of the Credit
Agreement, be paid directly to each Grantor. In

 

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addition, prior to the occurrence of any Event of Default and receipt by any
relevant Grantor of a notice described in clause (b)(ii), such Grantor may
exercise its voting and other consensual rights with respect to the Pledged
Equity Interests, provided that the same is exercised in a manner not
inconsistent with the terms of this Agreement or any other Loan Document.
Notwithstanding the foregoing, all distributions in the form of additional
Equity Interests shall be paid and delivered to the Administrative Agent and
held as additional Collateral hereunder.

(b) Each Grantor agrees that if any Event of Default shall have occurred and be
continuing:

(i) such Grantor shall, promptly upon receipt thereof and without any request
therefor by the Administrative Agent, deliver (properly endorsed where required
hereby or requested by the Administrative Agent) to the Administrative Agent all
dividends, distributions, interest, principal, other cash payments and Proceeds
of the Collateral, all of which shall be held by the Administrative Agent as
additional Collateral for use in accordance with Section 6.4; and

(ii) after the Administrative Agent has notified such Grantor of the
Administrative Agent’s intention to exercise its voting power under this clause:

(A) the Administrative Agent may exercise (to the exclusion of such Grantor) the
voting power and all other incidental rights of ownership with respect to any
Pledged Equity Interests or other Equity Interests constituting Collateral, and
such Grantor hereby grants the Administrative Agent an irrevocable proxy,
exercisable under such circumstances, to vote the Pledged Equity Interests and
such other Collateral; and

(B) such Grantor shall promptly deliver to the Administrative Agent such
additional proxies and other documents as may be necessary to allow the
Administrative Agent to exercise such voting power.

(c) All dividends, distributions, interest, principal, cash payments, and
proceeds which may at any time and from time to time be held by any Grantor but
which such Grantor is then obligated to deliver to the Administrative Agent
shall, until delivery to the Administrative Agent, be held by each Grantor
separate and apart from such Grantor’s other property in trust for the
Administrative Agent.

SECTION 2.5 Continuing Security Interest; Transfer of Notes. This Agreement
shall create a continuing security interest in the Collateral and shall remain
in full force and effect until payment in full in cash of all Secured
Obligations (on terms and pursuant to documentation in form and substance
reasonably satisfactory to the Administrative Agent) and the irrevocable
termination of all the Commitments, at which time the security interest granted
herein shall terminate and all rights to the Collateral shall revert to the
Grantors. In the event that any part of the Collateral is sold in connection
with a sale permitted under the Credit Agreement (other than a sale to a
Grantor) the security interest granted herein shall terminate with respect to
such Collateral and all rights therein shall revert to the applicable Grantor or
Grantors. Upon any such termination, the Administrative Agent will, at each
Grantor’s sole expense, deliver to such Grantor, without any representations,
warranties or recourse of any kind whatsoever, all

 

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certificates and instruments representing or evidencing all Pledged Equity
Interests, together with all other Collateral held by the Administrative Agent
hereunder, and execute and deliver to such Grantor such documents as such
Grantor shall reasonably request to evidence such termination or release.

SECTION 2.6 Security Interest Absolute. All rights of the Administrative Agent
and the security interests granted to the Administrative Agent hereunder, and
all obligations of each Grantor hereunder, shall be absolute and unconditional,
irrespective of:

(a) any lack of validity, legality or enforceability of any Loan Document;

(b) the failure of any Lender Party:

(i) to assert any claim or demand or to enforce any right or remedy against any
Grantor, any other Loan Party or any other Person under the provisions of any
Loan Document or otherwise; or

(ii) to exercise any right or remedy against any other guarantor of, or
collateral securing, any Secured Obligation of any Grantor or any other Loan
Party;

(c) any change in the time, manner or place of payment of, or in any other term
of, all or any of the Secured Obligations or any other extension, compromise or
renewal of any Secured Obligation, including any increase in the Secured
Obligations resulting from the extension of additional credit to any Grantor or
any other Loan Party or otherwise;

(d) any reduction, limitation, impairment or termination of any Secured
Obligation of any Grantor or of any other Loan Party for any reason, including
any claim of waiver, release, surrender, alteration or compromise, and shall not
be subject to (and each Grantor hereby waives any right to or claim of) any
defense or setoff, counterclaim, recoupment or termination whatsoever by reason
of the invalidity, illegality, nongenuineness, irregularity, compromise,
unenforceability of, or any other event or occurrence affecting, any Secured
Obligation of any Grantor or of any other Loan Party or otherwise;

(e) any amendment to, rescission, waiver, or other modification of, or any
consent to departure from, any of the terms of any Loan Document;

(f) any addition, exchange, release, surrender or non-perfection of any
collateral (including the Collateral), or any amendment to or waiver or release
of or addition to or consent to departure from any guaranty, for any of the
Secured Obligations; or

(g) any other circumstances which might otherwise constitute a defense available
to, or a legal or equitable discharge of, any Grantor, any other Loan Party, any
surety or any guarantor or otherwise, including as a result of any proceeding of
the nature referred to in Section 8.1.7 of the Credit Agreement.

SECTION 2.7 Grantors Remain Liable. Anything herein to the contrary
notwithstanding:

 

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(a) each Grantor shall remain liable under the contracts and agreements included
in the Collateral to the extent set forth therein, and shall perform all of such
Grantor’s duties and obligations under such contracts and agreements to the same
extent as if this Agreement had not been executed;

(b) each Grantor will comply in all material respects with all Laws relating to
the ownership and operation of the Collateral, including, without limitation,
all registration requirements under applicable Laws, and shall pay when due all
taxes, fees and assessments imposed on or with respect to the Collateral, except
to the extent the validity thereof is (A) being diligently contested in good
faith by appropriate proceedings which (i) suspend the collection thereof and
any Lien therefrom and (ii) for which adequate reserves in accordance with GAAP
have been set aside by such Grantor, and (B) could not reasonably be expected to
have, either individually or in the aggregate, a Material Adverse Effect;

(c) the exercise by the Administrative Agent of any of its rights hereunder
shall not release any Grantor from any of such Grantor’s duties or obligations
under such Grantor’s Organizational Documents or any contract or agreement
included in the Collateral; and

(d) neither the Administrative Agent nor any other Lender Party shall have any
obligation or liability under any Organizational Document or any contracts or
agreements included in the Collateral by reason of this Agreement, nor shall the
Administrative Agent or any other Lender Party be obligated to perform any of
the obligations or duties of any Grantor thereunder or to take any action to
collect or enforce any claim for payment assigned hereunder.

SECTION 2.8 Waiver of Subrogation. Each Grantor hereby irrevocably waives to the
extent permitted by applicable Law and until such time as the Secured
Obligations shall have been paid in full in cash (on terms and pursuant to
documentation in form and substance reasonably satisfactory to the
Administrative Agent) and all the Commitments have irrevocably terminated, any
claim or other rights which such Grantor may now or hereafter acquire against
each Borrower or any other Loan Party that arises from the existence, payment,
performance or enforcement of such Grantor’s obligations under this Agreement or
any other Loan Document, including any right of subrogation, reimbursement,
exoneration or indemnification, and any right to participate in any claim or
remedy of any Lender Party against each Borrower or any other Loan Party or any
collateral which any Lender Party now has or hereafter acquires, whether or not
such claim, remedy or right arises in equity or under contract or Law. If any
amount shall be paid to any Grantor in violation of the preceding sentence, such
amount shall be deemed to have been paid to such Grantor for the benefit of, and
held in trust for, the Lender Parties, and shall forthwith be paid to the
Administrative Agent to be credited and applied against the Secured Obligations,
whether matured or unmatured. Each Grantor acknowledges that such Grantor will
receive direct and indirect benefits for the financing arrangements contemplated
by the Credit Agreement and that the waiver set forth in this Section is
knowingly made in contemplation of such benefits.

 

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ARTICLE III

REPRESENTATIONS AND WARRANTIES

Each Grantor represents and warrants unto each Lender Party, as of the date such
Grantor becomes a party to this Agreement, the making of the Loans and each
pledge and delivery by such Grantor to the Administrative Agent of any
Collateral, as set forth in this Article.

SECTION 3.1 Ownership, No Liens, etc. Such Grantor has pledged to the
Administrative Agent, for its benefit and the benefit of each other Lender
Party, all the Pledged Equity Interests that is required to pledge pursuant to
the Credit Agreement. Such Grantor is the legal and beneficial owner of, and has
good and marketable title to (and has full corporate, partnership or limited
liability company right and authority to pledge and assign) the Collateral, free
and clear of all Liens, except for this security interest granted pursuant
hereto in favor of the Administrative Agent for the benefit of the Lender
Parties. All of the Pledge Equity Interests have been duly authorized, validly
issued and are fully paid and non-assessable, and have not been issued or
transferred in violation of any securities or other applicable Law. Except as
permitted by the Credit Agreement, there are no existing options, warrants,
calls, purchase rights, commitments or obligations with respect to the Pledged
Equity Interests.

SECTION 3.2 Valid Security Interest. The delivery of any Pledged Equity
Interests forming a part of the Collateral to the Administrative Agent is
effective to create a valid, perfected, first priority security interest therein
and all Proceeds thereof, securing the Secured Obligations, in favor of the
Administrative Agent for the ratable benefit of the Lender Parties. No filing or
other action will be necessary to perfect or protect such security interest.

SECTION 3.3 As to Pledged Shares. In the case of any Pledged Shares constituting
Collateral, all of such Pledged Shares are duly authorized and validly issued,
fully paid, and non-assessable, and constitute all of the issued and outstanding
capital stock of each Securities Issuer thereof. The Grantors have no
Subsidiaries other than the Securities Issuers and Timberlands II.

SECTION 3.4 As to Pledged Membership Interests and Pledged Partnership
Interests, etc.

(a) In the case of any Pledged Membership Interests and Pledged Partnership
Interests constituting a part of the Collateral, all of such Pledged Equity
Interests are certificated, duly authorized and validly issued, fully paid and
non-assessable, and constitute all of the issued and outstanding partnership
interests and membership interests held by such Grantor in the applicable
Securities Issuer.

(b) Each LLC Agreement and Partnership Agreement to which the Grantor is a
party, true and complete copies of which have been furnished to the
Administrative Agent, has been duly authorized, executed, and delivered by such
Grantor, has not been amended or otherwise modified except as permitted by the
Credit Agreement, is in full force and effect, and is binding upon and
enforceable against such Grantor in accordance with its terms. There exists no
material default (or other default that could reasonably be expected to impair
the interests or

 

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rights of the Administrative Agent) under any such LLC Agreement or Partnership
Agreement by such Grantor.

(c) Each such LLC Agreement and Partnership Agreement, as the case may be,
expressly provides that the Pledged Membership Interests or Pledged Partnership
Interests, as the case may be, are “securities” governed by Article 8 of the
U.C.C. and are required to be in certificated form.

(d) Such Grantor’s Equity Interests in each Securities Issuer is set forth in
Schedule I attached hereto (as such Schedule may be amended or supplemented from
time to time).

(e) Such Grantor had and continues to have the power and legal capacity to
execute and carry out the provisions of all such LLC Agreements and Partnership
Agreements, as the case may be, to which such Grantor is a party.

(f) The state of organization of each Securities Issuer of any Pledged
Membership Interests and Pledged Partnership Interests constituting a part of
the Collateral is as set forth in Item B or Item C of Schedule I attached hereto
(as such Schedule may be amended or supplemented from time to time).

SECTION 3.5 Authorization, Approval, etc. No authorization, approval or other
action by, and no notice to or filing with, any Governmental Authority or any
other Person is required either for (a) the pledge by such Grantor of any
Collateral pursuant to this Agreement or for the execution, delivery and
performance of this Agreement by such Grantor or (b) the exercise by the
Administrative Agent of the voting or other rights provided for in this
Agreement or the remedies in respect of the Collateral pursuant to this
Agreement, except, with respect to the Pledged Equity Interests, as may be
required in connection with a disposition of such Pledged Equity Interests by
Laws affecting the offering and sale of securities generally.

SECTION 3.6 Due Execution, Validity, etc. Such Grantor has full corporate,
partnership or limited liability company power and authority, and holds all
requisite licenses, permits and other approvals of Governmental Authorities, to
enter into and perform such Grantor’s obligations under this Agreement. The
execution, delivery and performance by such Grantor of this Agreement does not
contravene or result in a default under such Grantor’s Organizational Documents
or contravene or result in a default under any contractual restriction, Lien or
Law binding on such Grantor. This Agreement has been duly authorized by such
Grantor, has been duly executed and delivered by or on behalf of such Grantor
and constitutes the legal, valid and binding obligation of such Grantor
enforceable in accordance with its terms, subject to the effect of any
applicable bankruptcy, insolvency, reorganization, moratorium or similar Laws
affecting the rights of creditors generally, and subject to the effect of
general principles of equity (regardless of whether considered in a proceeding
in equity or at law).

ARTICLE IV

COVENANTS

SECTION 4.1 Protect Collateral; Further Assurances, etc. No Grantor will create
or suffer to exist any Lien on the Collateral (except a Lien in favor of the
Administrative

 

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Agent). Each Grantor will warrant and defend the right and title herein granted
unto the Administrative Agent in and to the Collateral (and all right, title,
and interest represented by the Collateral) against the claims and demands of
all Persons (other than the Administrative Agent). Each Grantor agrees that at
any time, and from time to time, at the expense of such Grantor, such Grantor
will promptly execute and deliver all further instruments and documents, and
take all further action, that may be necessary or desirable, or that the
Administrative Agent may reasonably request, in order to perfect, preserve and
protect any security interest granted or purported to be granted hereby or to
enable the Administrative Agent to exercise and enforce its rights and remedies
hereunder with respect to any Collateral. Except as permitted by the Credit
Agreement, no Grantor will permit any Securities Issuer to own any Equity
Interest unless the same is immediately delivered in pledge to the
Administrative Agent hereunder.

SECTION 4.2 Powers, etc. Each Grantor agrees that all Pledged Equity Interests
delivered by such Grantor pursuant to this Agreement will be accompanied by duly
executed undated blank powers, or other equivalent instruments of transfer
reasonably acceptable to the Administrative Agent. Each Grantor will, from time
to time upon the reasonable request of the Administrative Agent, promptly
deliver to the Administrative Agent such powers, instruments, and similar
documents, reasonably satisfactory in form and substance to the Administrative
Agent, with respect to the Collateral and will, from time to time upon the
request of the Administrative Agent during the continuance of any Event of
Default, promptly transfer any Pledged Equity Interests or other Equity
Interests constituting Collateral into the name of any nominee designated by the
Administrative Agent.

SECTION 4.3 Continuous Pledge. Subject to Section 2.4, each Grantor will, at all
times, keep pledged to the Administrative Agent pursuant hereto all Pledged
Equity Interests constituting Collateral, all dividends and distributions with
respect thereto and all other Collateral and other securities, instruments,
proceeds, and rights from time to time received by or distributable to such
Grantor in respect of any Collateral.

SECTION 4.4 LLC Agreements, Partnership Agreements and Organizational Documents.
(a) Each Grantor shall at such Grantor’s own expense:

(i) perform and observe in all material respects all the terms and provisions of
each LLC Agreement, Partnership Agreement or other Organizational Document
relating to the Collateral, as the case may be, to which such Grantor is a party
and each other contract and agreement included in all the Collateral to be
performed or observed by such Grantor, maintain such LLC Agreement, Partnership
Agreement or other Organizational Document relating to the Collateral, as the
case may be, and each such other contract and agreement in full force and
effect, in such Grantor’s reasonable business judgment, enforce such LLC
Agreement, Partnership Agreement or other Organizational Document relating to
the Collateral, as the case may be, and each such other contract and agreement
in accordance with its terms, and, upon the occurrence and during the
continuance of any Event of Default, take all such action to such end as may
from time to time be requested by the Administrative Agent; and

(ii) from time to time (A) furnish to the Administrative Agent such information
regarding the Collateral as the Administrative Agent may reasonably request, and
(B) upon the occurrence and during the continuance of any Event of Default, upon
the request of

 

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the Administrative Agent, make to any other party to such LLC Agreement,
Partnership Agreement or other Organizational Document relating to the
Collateral, as the case may be, such requests for information and for action as
such Grantor is entitled to make thereunder.

(b) No Grantor shall consent to any amendment, supplement, waiver or other
modification of any of the terms or provisions contained in, or applicable to,
any LLC Agreement, Partnership Agreement or other Organizational Document except
as permitted under Section 7.2.10 of the Credit Agreement.

SECTION 4.5 Additional Covenants. Each Grantor agrees that, until all the
Secured Obligations have been paid in full in cash on terms and pursuant to
documentation in form and substance reasonably satisfactory to the
Administrative Agent and all Commitments shall have irrevocably terminated, it
will comply with all the terms and provisions of the Credit Agreement and the
other Loan Documents that are applicable to it.

ARTICLE V

THE ADMINISTRATIVE AGENT

SECTION 5.1 Administrative Agent Appointed Attorney-in-Fact. Each Grantor hereby
irrevocably constitutes and appoints the Administrative Agent and any officer or
agent thereof, with full power of substitution, as such Grantor’s true and
lawful attorney-in-fact with full irrevocable power and authority in the place
and stead of such Grantor and in the name of such Grantor or in such Grantor’s
own name, for the purpose of carrying out the terms of this Agreement, to take,
upon the occurrence and during the continuance of any Event of Default, any and
all actions and execute any and all documents and instruments that may, in the
judgment of the Administrative Agent, be necessary or desirable to accomplish
the purposes of this Agreement. Without limiting the generality of the
foregoing, after the occurrence and during the continuance of any Event of
Default, each Grantor hereby gives the Administrative Agent the power and right,
on behalf of such Grantor, without notice to or assent by such Grantor, to do
any or all of the following:

(a) take possession of and indorse and collect any checks, drafts, notes,
acceptances or other instruments for the payment of moneys due under or in
respect of any Collateral and file any claim or take any other action or
proceeding in any court of law or equity or otherwise deemed appropriate by the
Administrative Agent for the purpose of collecting any and all such moneys due
under or in respect of any Collateral whenever payable;

(b) pay or discharge taxes and Liens levied or placed on or threatened against
the Collateral;

(c) execute, in connection with any sale or other disposition provided for in
Section 6.1, any endorsements, assignments or other instruments of conveyance or
transfer with respect to the Collateral; and

(d) (i) direct any Person liable for any payment under any of the Collateral to
make payment of any and all moneys due or to become due thereunder directly to
the Administrative Agent or as the Administrative Agent shall direct; (ii) ask
or demand for, collect, and receive payment of and give receipt for, any and all
moneys, claims and other amounts due

 

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or to become due at any time in respect of or arising out of any Collateral;
(iii) receive, collect, sign and indorse any drafts or other instruments,
documents and chattel paper in connection in connection with any of the
Collateral; (iv) commence and prosecute any suits, actions or proceedings at law
or in equity in any court of competent jurisdiction to collect the Collateral or
any portion thereof and to enforce any other right in respect of any Collateral;
(v) defend any suit, action or proceeding brought against such Grantor with
respect to any Collateral; (vi) settle, compromise or adjust any such suit,
action or proceeding and, in connection therewith, give such discharges or
releases as the Administrative Agent may deem appropriate; and (vii) generally,
sell, transfer, pledge and make any agreement with respect to or otherwise deal
with any of the Collateral as fully and completely as though the Administrative
Agent were the absolute owner thereof for all purposes, and do, at the
Administrative Agent’s option and such Grantor’s expense, at any time, or from
time to time, all acts and things that the Administrative Agent deems necessary
to protect, preserve or realize upon the Collateral and the Lender Parties’
security interests therein and to effect the intent of this Agreement, all as
fully and effectively as such Grantor might do.

Each Grantor hereby acknowledges, consents and agrees that the power of attorney
granted pursuant to this Section is irrevocable and coupled with an interest.

SECTION 5.2 Administrative Agent May Perform. If any Grantor fails to perform
any agreement contained herein, the Administrative Agent may itself perform, or
cause performance of, such agreement and the reasonable expenses of the
Administrative Agent incurred in connection therewith shall be payable by such
Grantor.

SECTION 5.3 Access and Examination. In order to give effect to the intent of
this Agreement, the Administrative Agent may at all reasonable times have access
to, examine, audit, make extracts from and inspect each Grantor’s records, files
and books of account and the Collateral, and may discuss each Grantor’s affairs
with such Grantor’s officers and management. Each Grantor will deliver to the
Administrative Agent promptly following its request therefor any instrument
necessary for the Administrative Agent to obtain records from any service bureau
maintaining records for such Grantor. The Administrative Agent may, at expense
of the Grantors, use each Grantor’s personnel, supplies and premises as may be
reasonably necessary for maintaining or enforcing the security interest granted
hereunder.

SECTION 5.4 Administrative Agent Has No Duty. The powers conferred on the
Administrative Agent hereunder are solely to protect its interest (on behalf of
the Lender Parties) in the Collateral and shall not impose any duty on it to
exercise any such powers. The Administrative Agent’s sole duty with respect to
the custody, safekeeping and physical preservation of the Collateral in its
possession, under Section 9-207 of the U.C.C. or otherwise, shall be to deal
with it in the same manner as the Administrative Agent deals with similar
property for its own account. Neither the Administrative Agent nor any of its
officers, directors, employees or agents shall be liable for failure to demand,
collect or realize upon any of the Collateral or for any delay in doing so, nor
shall any such Person be under any obligation to sell or otherwise dispose of
any Collateral upon the request of any Grantor or any other Person or to take
any other action whatsoever with regard to the Collateral or any part thereof
(including (a) ascertaining or taking action with respect to calls, conversions,
exchanges, maturities, tenders or other matters relative to any Pledged Equity
Interests, whether or not the Administrative Agent

 

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has or is deemed to have knowledge of such matters, and (b) the taking of any
necessary steps to preserve rights against prior parties or any other rights
pertaining to any Collateral). Neither the Administrative Agent nor any of its
officers, directors, employees or agents shall be responsible to any Grantor for
any loss, damage, depreciation or other diminution in the value of any of the
Collateral, except in respect of any damages attributable solely to any such
Person’s gross negligence or willful misconduct as determined in a final
non-appealable judgment of a court of competent jurisdiction.

ARTICLE VI

REMEDIES

SECTION 6.1 Remedies. If any Event of Default shall have occurred and be
continuing the Administrative Agent may:

(a) exercise in respect of the Collateral, in addition to other rights and
remedies provided for herein or otherwise available to it (including, without
limitation, as provided in Section 5.1 and clause (b) of Section 2.4), all the
rights and remedies of a secured party on default under the U.C.C. and also may,
without demand of performance or other demand, presentment, obtaining a final
judgment, protest, advertisement or notice of any kind (except any notice
required by Law referred to below) to or upon any Grantor or any other Person
(all and each of which demands, defenses, advertisements and notices are hereby
waived), sell, assign, give option or options to purchase, or otherwise dispose
of and deliver the Collateral or any part thereof (or contract to do any of the
foregoing) in one or more parcels at public or private sale, at any of the
Administrative Agent’s offices or elsewhere, for cash, on credit or for future
delivery, and upon such other terms as the Administrative Agent may deem
commercially reasonable. Each Grantor agrees that, to the extent notice of sale
shall be required by Law, at least 10 days’ prior notice to such Grantor of the
time and place of any public sale or the time after which any private sale is to
be made shall constitute reasonable notification. The Administrative Agent shall
not be obligated to make any sale of Collateral regardless of notice of sale
having been given. The Administrative Agent may adjourn any public or private
sale from time to time by announcement at the time and place fixed therefor, and
such sale may, without further notice, be made at the time and place to which it
was so adjourned. In case any sale of all or any part of the Collateral is made
on credit or for future delivery, the Collateral so sold may be retained by the
Administrative Agent until the sale price is paid by the purchase or purchasers
thereof, but the Administrative Agent shall not incur any liability in case any
such purchaser or purchasers shall fail to take up and pay for the Collateral so
sold and, in case of any such failure, such Collateral may be sold again upon
like notice. At any public (or, to the extent permitted by Law, private) sale
made pursuant to this Section, any Lender Party may bid for or purchase, free
(to the extent permitted by Law) from any right of redemption, stay, valuation
or appraisal on the part of any Grantor (all said rights being also hereby
waived and released to the extent permitted by Law), the Collateral or any part
thereof offered for sale and may make payment on account thereof by using any
claim then due and payable to such Lender Party from any Grantor as a credit
against the purchase price, and such Lender Party may upon compliance with the
terms of sale, hold, retain and dispose of such property without further
accountability to any Grantor therefor;

 

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(b) exercise any and all rights and remedies of each Grantor under or in
connection with the Collateral, including the right to sue upon or otherwise
collect, extend the time for payment of, modify or amend the terms of,
compromise or settle for cash, credit, or otherwise upon any terms, grant other
indulgences, extensions, renewals, compositions, or releases, and take or omit
to take any other action with respect to the Collateral, any security therefor,
any agreement relating thereto, any insurance applicable thereto, or any Person
liable directly or indirectly in connection with any of the foregoing, without
discharging or otherwise affecting the liability of any Grantor for the
Obligations or under this Agreement or any other Loan Document and the Assigned
Agreements or otherwise in respect of the Collateral, including any and all
rights of such Grantor to demand or otherwise require payment of any amount
under, or performance of any provision of, any Collateral; and

(c) enforce compliance with, and take any and all actions with respect to, each
LLC Agreement, Partnership Agreement or other Organizational Document, as the
case may be, to the fullest extent as though the Administrative Agent were the
absolute owner of the Pledged Membership Interests, Pledged Partnership
Interests, Pledged Shares and other Collateral, including the right to receive
all distributions and other payments that are made pursuant to such LLC
Agreement , Partnership Agreement or other Organizational Document, as the case
may be.

SECTION 6.2 Securities Laws. If the Administrative Agent shall determine to
exercise its right to sell all or any of the Collateral pursuant to Section 6.1,
each Grantor agrees that, upon request of the Administrative Agent, such Grantor
will, at its own expense:

(a) execute and deliver, and cause each issuer of the Collateral contemplated to
be sold and the directors and officers thereof to execute and deliver, all such
instruments and documents, and do or cause to be done all such other acts and
things, as may be necessary or, in the opinion of the Administrative Agent,
advisable to register such Collateral under the provisions of the Securities Act
of 1933, as from time to time amended (the “Securities Act”), and to cause the
registration statement relating thereto to become effective and to remain
effective for such period as prospectuses are required by Law to be furnished,
and to make all amendments and supplements thereto and to the related prospectus
which, in the opinion of the Administrative Agent, are necessary or advisable,
all in conformity with the requirements of the Securities Act and the rules and
regulations of the Securities and Exchange Commission applicable thereto;

(b) use its best efforts to qualify the Collateral under the state securities or
“Blue Sky” Laws and to obtain all necessary governmental approvals for the sale
of the Collateral, as requested by the Administrative Agent;

(c) cause each such issuer to make available to its security holders, as soon as
practicable, an earnings statement that will satisfy the provisions of
Section 11(a) of the Securities Act; and

(d) do or cause to be done all such other acts and things as may be necessary to
make such sale of the Collateral or any part thereof valid and binding and in
compliance with applicable Law.

 

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Each Grantor further acknowledges the impossibility of ascertaining the amount
of damages that would be suffered by the Administrative Agent or the Lenders by
reason of the failure by such Grantor to perform any of the covenants contained
in this Section and, consequently, to the extent permitted under applicable Law,
agrees that, if such Grantor shall fail to perform any of such covenants, it
shall pay, as liquidated damages and not as a penalty, an amount equal to the
value (as determined by the Administrative Agent) of the Collateral on the date
the Administrative Agent shall demand compliance with this Section.

SECTION 6.3 Compliance with Restrictions. Each Grantor agrees that in any sale
of any of the Collateral whenever an Event of Default shall have occurred and be
continuing, the Administrative Agent is hereby authorized to comply with any
limitation or restriction in connection with such sale as it may be advised by
counsel is necessary in order to avoid any violation of applicable Law
(including compliance with such procedures as may restrict the number of
prospective bidders and purchasers, require that such prospective bidders and
purchasers have certain qualifications, and restrict such prospective bidders
and purchasers to persons who will represent and agree that they are purchasing
for their own account for investment and not with a view to the distribution or
resale of such Collateral), or in order to obtain any required approval of the
sale or of the purchaser by any Governmental Authority or official, and each
Grantor further agrees that such compliance shall not result in such sale being
considered or deemed not to have been made in a commercially reasonable manner,
nor shall the Administrative Agent be liable nor accountable to any Grantor for
any discount allowed by reason of the fact that such Collateral is sold in
compliance with any such limitation or restriction.

SECTION 6.4 Application of Proceeds. All cash proceeds received by the
Administrative Agent in respect of any sale of, collection from, or other
realization upon, all or any part of the Collateral shall be applied (after
payment of any amounts payable to the Administrative Agent pursuant to
Section 11.3 of the Credit Agreement and Section 6.5) in whole or in part by the
Administrative Agent for the ratable benefit of the Lender Parties against all
or any part of the Secured Obligations in accordance with Section 8.6 of the
Credit Agreement. Any surplus of such cash or cash proceeds held by the
Administrative Agent and remaining after payment in full in cash of all the
Secured Obligations (on terms and pursuant to documentation in form and
substance reasonably satisfactory to the Administrative Agent), and the
irrevocable termination of all the Commitments, shall be paid over to the
applicable Grantor or to whomsoever may be lawfully entitled to receive such
surplus.

SECTION 6.5 Indemnity and Expenses. Each Grantor agrees to jointly and severally
indemnify and hold harmless the Administrative Agent and its directors,
officers, employees, agents, Affiliates and their Related Parties from and
against any and all claims, losses and liabilities arising out of or resulting
from this Agreement (including enforcement of this Agreement), except claims,
losses or liabilities resulting from any such Person’s gross negligence or
willful misconduct as determined by a final non-appealable judgment of a court
of competent jurisdiction. Each Grantor will upon demand pay to the
Administrative Agent the amount of any and all reasonable out-of-pocket
expenses, including the reasonable fees and disbursements of its counsel and of
any experts and agents, which the Administrative Agent may incur in connection
with (a) the administration of this Agreement, (b) the custody, preservation,
use or operation of, or the sale of, collection from, or other realization upon,
any of the

 

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Collateral, (c) the exercise or enforcement of any of the rights of the
Administrative Agent or the other Lender Parties hereunder or (d) the failure by
any Grantor to perform or observe any of the provisions hereof.

ARTICLE VII

MISCELLANEOUS PROVISIONS

SECTION 7.1 Loan Document. This Agreement is a Loan Document executed pursuant
to the Credit Agreement and shall (unless otherwise expressly indicated herein)
be construed, administered and applied in accordance with the terms and
provisions thereof, including Section 1.3 and Article XI thereof.

SECTION 7.2 Amendments, etc.; Additional Grantors; Successors and Assigns.

(a) No amendment to or waiver of any provision of this Agreement nor consent to
any departure by any Grantor herefrom, shall be effective unless the same shall
be in writing and signed by the Administrative Agent and the percentage of the
Lenders as required by Section 11.1 of the Credit Agreement, and then such
amendment, waiver or consent shall be effective only in the specific instance
and for the specific purpose for which it is given.

(b) Upon the execution and delivery by any Person of a pledge agreement
supplement in substantially the form of Exhibit A hereto (each a “Pledge
Agreement Supplement”), (i) such Person shall be referred to as an “Additional
Grantor” and shall be and become a Grantor, and each reference in this Agreement
to “Grantor” shall also mean and refer to such Additional Grantor and (ii) the
disclosure schedule attached to each Security Agreement Supplement shall be
incorporated into and become a part of and supplement Schedules I through VI
attached hereto, as appropriate, and the Administrative Agent may attach such
supplemental disclosure schedules to such Schedules, and each reference to such
Schedules shall refer to such Schedules as amended or supplemented by such
supplemental disclosure schedules.

(c) This Agreement shall be binding upon each Grantor and its successors,
transferees and assignees, and shall inure to the benefit of and be enforceable
by the Administrative Agent and each other Lender Party and their respective
successors and assigns; provided, however, that no Grantor may assign such
Grantor’s obligations hereunder without the prior written consent of the
Administrative Agent. Without limiting the generality of the foregoing, any
Lender may assign or otherwise transfer (in whole or in part) any Loans held by
it to any other Person, and such other Person shall thereupon become vested with
all the rights and benefits in respect thereof granted to such Lender under any
Loan Document (including this Agreement) or otherwise, subject, however, to the
provisions of Section 11.10 of the Credit Agreement.

SECTION 7.3 Addresses for Notices. All notices and other communications provided
for hereunder shall be made as provided in, and subject to the terms of,
Section 11.2 of the Credit Agreement. All notices to each Grantor shall be sent
care of the Borrowers at the address set forth in the Credit Agreement and all
notices to the Administrative Agent shall be sent as provided in the Credit
Agreement.

 

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SECTION 7.4 Section Captions. Section captions used in this Agreement are for
convenience of reference only, and shall not affect the construction of this
Agreement.

SECTION 7.5 Severability. Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such provision and such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions of this Agreement
or affecting the validity or enforceability of such provision in any other
jurisdiction.

SECTION 7.6 Counterparts. This Agreement may be executed by the parties hereto
in several counterparts, each of which shall be deemed to be an original and all
of which shall constitute together but one and the same agreement.

SECTION 7.7 Waivers. Each Grantor hereby waives any right, to the extent
permitted by applicable Law, to receive prior notice of a judicial or other
hearing with respect to any action or prejudgment remedy or proceeding by the
Administrative Agent to take possession, exercise control over or dispose of any
item of Collateral, where such action is permitted under the terms of this
Agreement or any other Loan Document or by applicable Law, or of the time, place
or terms of sale in connection with the exercise of the Administrative Agent’s
rights hereunder. Each Grantor waives, to the extent permitted by applicable
Law, any bonds, security or sureties required by the Administrative Agent with
respect to any of the Collateral. Without limiting the foregoing, each Grantor
agrees that it will not invoke, claim or assert any benefit of applicable Law,
or take or attempt to take any action that could reasonably be expected to have
the effect of delaying, impeding or preventing the Administrative Agent from
exercising any of its rights or remedies with respect to the Collateral as
herein provided.

SECTION 7.8 Governing Law, Entire Agreement, etc. THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF
NEW YORK, EXCEPT TO THE EXTENT THAT THE VALIDITY OR PERFECTION OF THE SECURITY
INTEREST HEREUNDER, OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR
COLLATERAL ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF
NEW YORK. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS CONSTITUTE THE ENTIRE
UNDERSTANDING AMONG THE PARTIES HERETO WITH RESPECT TO THE SUBJECT MATTER HEREOF
AND SUPERSEDE ANY PRIOR AGREEMENTS, WRITTEN OR ORAL, WITH RESPECT THERETO.

SECTION 7.9 Forum Selection and Consent to Jurisdiction. ANY LITIGATION BASED
HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS AGREEMENT, OR ANY
COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR
ACTIONS OF ANY LENDER PARTY OR GRANTOR SHALL BE BROUGHT AND MAINTAINED IN THE
FEDERAL AND STATE COURTS LOCATED IN THE BOROUGH OF MANHATTAN OF THE STATE OF NEW
YORK; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY
COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT THE

 

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ADMINISTRATIVE AGENT’S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE SUCH
COLLATERAL OR OTHER PROPERTY MAY BE FOUND. EACH GRANTOR AND LENDER PARTY HEREBY
EXPRESSLY AND IRREVOCABLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF SUCH COURTS
FOR THE PURPOSE OF ANY SUCH LITIGATION AS SET FORTH ABOVE AND IRREVOCABLY AGREES
TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH SUCH LITIGATION.
EACH GRANTOR FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS BY
REGISTERED MAIL, POSTAGE PREPAID OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE
STATE OF NEW YORK. EACH GRANTOR HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH SUCH GRANTOR MAY HAVE OR
HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY
SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN
BROUGHT IN AN INCONVENIENT FORUM. TO THE EXTENT THAT ANY GRANTOR HAS OR
HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY
LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT,
ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO SUCH GRANTOR OR
SUCH GRANTOR’S PROPERTY, SUCH GRANTOR, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF SUCH
GRANTOR’S OBLIGATIONS UNDER THIS AGREEMENT.

SECTION 7.10 Waiver of Jury Trial, etc. EACH LENDER PARTY AND GRANTOR HEREBY
KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHTS SUCH GRANTOR MAY HAVE
TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF,
UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF ANY LENDER PARTY OR
ANY GRANTOR. EACH GRANTOR ACKNOWLEDGES AND AGREES THAT SUCH GRANTOR HAS RECEIVED
FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION AND THAT THIS PROVISION IS
A MATERIAL INDUCEMENT FOR THE ADMINISTRATIVE AGENT ENTERING INTO THIS AGREEMENT.

SECTION 7.11 Waiver of Certain Claims. TO THE EXTENT PERMITTED BY APPLICABLE
LAW, NO GRANTOR SHALL ASSERT, AND HEREBY WAIVES, ANY CLAIM AGAINST EACH LENDER
PARTY ON ANY THEORY OF LIABILITY FOR SPECIAL, INDIRECT, CONSEQUENTIAL OR
PUNITIVE DAMAGES (AS OPPOSED TO DIRECT OR ACTUAL DAMAGES) ARISING OUT OF, IN
CONNECTION WITH, OR AS A RESULT OF, THIS AGREEMENT OR ANY INSTRUMENT
CONTEMPLATED HEREBY.

SECTION 7.12 No Strict Construction. The parties hereto have participated
jointly in the negotiation and drafting of this Agreement. In the event an
ambiguity or question of

 

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intent or interpretation arises, this Agreement shall be construed as if drafted
jointly by the parties hereto and no presumption or burden of proof shall arise
favoring or disfavoring any party by virtue of the authorship of any provisions
of this Agreement.

SECTION 7.13 No Novation. The amendment and restatement of the Original Pledge
Agreement by this Agreement shall not constitute a novation or termination of
the obligations and covenants of the Grantors thereunder, but shall constitute
an amendment and restatement of the obligations and covenants of the Grantors
under such Original Pledge Agreement and each Grantor party to the Original
Pledge Agreement hereby reaffirms all such obligations and covenants under the
Original Pledge Agreement as amended and restated hereby.

 

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IN WITNESS WHEREOF, each Grantor has caused this Agreement to be duly executed
and delivered as of the day and year first above written.

 

WELLS TIMBERLAND OPERATING

PARTNERSHIP, L.P.

 

By:

 

WELLS TIMBERLAND REIT, INC.,

its General Partner

 

By:

 

 

   

Name:

 

Douglas P. Williams

   

Title:

  Executive Vice President, Secretary & Treasurer

TIMBERLANDS II, LLC

By:

  WELLS TIMBERLAND MANAGEMENT ORGANIZATION, LLC, its Manager  

By:

 

 

   

Name:

 

Brian M. Davis

   

Title:

  Senior Vice President & Chief Financial Officer WELLS TIMBERLAND TRS, INC.

By:

 

 

 

Name:

 

Douglas P. Williams

 

Title:

  Executive Vice President, Secretary & Treasurer

PLEDGE AGREEMENT

SIGNATURE PAGE

 

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WELLS TRS HARVESTING OPERATIONS, LLC

By:

  FOREST RESOURCE CONSULTANTS, INC., its Manager  

By:

 

 

   

Name:

 

David T. Foil

   

Title:

 

President

WELLS TIMBERLAND HBU, LLC

By:

  WELLS TIMBERLAND MANAGEMENT ORGANIZATION, LLC, its Manager  

By:

 

 

   

Name:

 

Brian M. Davis

   

Title:

  Senior Vice President & Chief Financial Officer

ACKNOWLEDGED AND ACCEPTED:

 

COBANK, ACB,

    as Administrative Agent

By:

 

 

 

Name:

 

Michael Tousignant

 

Title:

 

Vice President

PLEDGE AGREEMENT

SIGNATURE

 

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SCHEDULE I

to

Pledge Agreement

 

Item A.   

Pledged

Shares

                   

Grantor

  

Securities

Issuer

  

Authorized

Shares

  

Outstanding

Shares

  

% of Shares

Pledged

  

Certificate

No.

Wells Timberland Operating Partnership, L.P.

  

Wells Timberland TRS, Inc.

   1000    100    100%    2 Item B.   

Pledged Membership

Interests

                   

Grantor

  

Securities

Issuer

  

State of

Organization

of Securities

Issuer

  

No. of

Membership

Interests

  

Membership

Interests %

of Interests

Pledged

  

Certificate

No.

Wells Timberland Operating Partnership, L.P.

  

Timberlands II, LLC

   Delaware    1,000    100%    3

Wells Timberland TRS, Inc.

  

Wells TRS Harvesting Operations, LLC

   Delaware    1,000    100%    1

Wells Timberland TRS, Inc.

  

Wells Timberland HBU, LLC

   Delaware    1,000    100%    3 Item C.   

Pledged Partnership

Interests

                   

Grantor

  

Securities

Issuer

  

State of

Organization

of Securities

Issuer

  

Type of

Pledged

Partnership

Interests

  

Partnership

% of Pledge

Partnership

Interest

  

Certificate

No.

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

EXHIBIT A

to

Pledge Agreement

FORM OF PLEDGE AGREEMENT SUPPLEMENT

[Date]

CoBank, ACB,

    as Administrative Agent

5550 South Quebec Street

Greenwood Village, Colorado 80111

Attention: Syndications Coordinator, Corporate Finance Division

TIMBERLANDS II, LLC and

WELLS TIMBERLAND OPERATING PARTNERSHIP, L.P.

Ladies and Gentlemen:

Reference is made to the Amended and Restated Pledge Agreement, dated as of
March 24, 2010 (as amended, supplemented, restated or otherwise modified from
time to time, the “Pledge Agreement”), made by WELLS TIMBERLAND OPERATING
PARTNERSHIP, L.P., a Delaware limited partnership (“Wells Partnership”),
TIMBERLANDS II, LLC, a Delaware limited liability company (“Wells Timberland”),
Wells Timberland TRS, Inc., a Delaware corporation (“Wells TRS”), Wells TRS
Harvesting Operations, LLC, a Delaware limited liability company (“Wells TRS
Subsidiary”), Wells Timberland HBU, LLC, a Delaware limited liability company
(“Wells HBU”) and each other Person (such capitalized term and all other
capitalized terms not otherwise defined herein to have the meanings provided for
in Article I of the Pledge Agreement) that may from time to time become a party
thereto (Wells Partnership, Wells Timberland, Wells TRS, Wells TRS Subsidiary,
Wells HBU and such other Persons that become Additional Grantors are
collectively referred to as the “Grantors” and individually as a “Grantor”), in
favor of CoBank, ACB, as administrative agent (in such capacity, the
“Administrative Agent”) for itself and each other Lender Party.

The undersigned hereby agrees, as of the date first above written, to become a
Grantor under the Pledge Agreement as if the undersigned were an original party
thereto and agrees that each reference in the Pledge Agreement to a “Grantor”
shall also mean and refer to the undersigned.

The undersigned hereby collaterally assigns, mortgages and pledges to the
Administrative Agent for its benefit and the ratable benefit of the Lender
Parties, and hereby grants to the

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Administrative Agent for its benefit and the ratable benefit of the Lender
Parties, as collateral for the Secured Obligations, a pledge and assignment of,
and a security interest in, all of the right, title and interest of the
undersigned in and to the undersigned’s Collateral, whether now owned or
hereafter acquired, subject to all of the terms and provisions of the Pledge
Agreement, as if such Collateral of the undersigned had been subject to the
Pledge Agreement on the date of its original execution.

The undersigned has attached hereto a supplement to Schedule I to the Pledge
Agreement, and the undersigned hereby certifies that such supplement is accurate
and complete as of the date first above written.

The undersigned hereby makes each representation and warranty set forth in
Article III of the Pledge Agreement as to itself and as to the undersigned’s
Collateral to the same extent as each other Grantor, and hereby agrees to be
bound as a Grantor by all of the terms and provisions of the Pledge Agreement to
the same extent as all the other Grantors.

This letter shall be governed by and construed in accordance with the terms and
provisions of the Pledge Agreement, including, without limitation, governing law
provisions thereof.

 

Very truly yours, [NAME OF ADDITIONAL GRANTOR]

By:

 

 

 

Name:

 

Title:

ACKNOWLEDGED AND ACCEPTED:

 

COBANK, ACB,     as Administrative Agent

By:

 

 

 

Name:

 

Title: