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Execution Version

BANK OF MONTREAL
1 First Canadian Place
Toronto, Ontario
M5X 1H3
Canada

BMO CAPITAL MARKETS CORP.
3 Times Square
New York, NY 10036

CONFIDENTIAL

July 30, 2015

SunOpta Inc.
2838 Bovaird Drive West
Brampton, Ontario L7A 0H2
Canada

SunOpta Foods Inc.
7301 Ohms Lane, Suite 600
Edina, Minnesota 55439
USA

Attention: Robert McKeracher, Vice President and Chief Financial Officer

Project Shine
$140.0 million Holdco PIK Toggle Bridge Facility
$290.0 million Opco Second Lien Bridge Facility
Commitment Letter

Ladies and Gentlemen:

You have advised Bank of Montreal (“BMO”) and BMO Capital Markets Corp. (“BMOCM”
and, together with BMO and our affiliates, “we”, “us” or the “Commitment
Parties”) that SunOpta Inc. (the “Holdco Borrower”) and SunOpta Foods Inc. (the
“Opco Borrower” and, together with the Holdco Borrower, the “Borrowers” or
“you”), intend to acquire (the “Acquisition”), directly or indirectly, the
capital stock of the Target (as defined in Exhibit A) and consummate the other
Transactions (including the finance transactions) described in Exhibit A.
Capitalized terms used but not defined herein shall have the meanings assigned
to them in the Exhibits attached hereto (such Exhibits, together with this
letter, collectively, the “Commitment Letter”). All references to “$” or
“dollars” in this Commitment letter mean US dollars.

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1.

Commitments

In connection with the Transactions, BMO is pleased to advise you of its
commitment to provide 100% of the aggregate principal amount of each of the
Bridge Facilities upon the terms and subject only to the applicable conditions
set forth in (a) Section 6 hereof, (b) the paragraph titled “Conditions to
Borrowing” under each of the Term Sheets set forth as Exhibit B hereto (the
“Holdco Term Sheet”) and Exhibit C hereto (the “Opco Term Sheet” and, together
with the Holdco Term Sheet, the “Term Sheets”) and (c) Exhibit D hereto). BMO
and any other initial lender that becomes a party hereto pursuant to the
provisions set forth in the proviso to the third sentence of Section 2 below are
sometimes referred to herein, collectively, as the “Initial Lenders” and each,
individually, as an “Initial Lender”.

2.

Titles and Roles

It is agreed that (a) BMOCM will act as the lead arranger (in such capacity,
together with any other lead arranger appointed pursuant to the provisions set
forth in the proviso to the third sentence of this Section 2, collectively, the
“Lead Arranger”) and the bookrunner for each of the Bridge Facilities (in such
capacity, together with any other bookrunner appointed pursuant to the
provisions set forth in the proviso to the third sentence of this Section 2,
collectively, the “Bookrunner”), and (b) BMO will act as administrative agent
(in such capacity, the “Bridge Administrative Agent”) for each of the Bridge
Facilities. It is further agreed that BMOCM shall have “lead left side”
designation and shall appear on the top left of any Information Materials (as
defined below) and all other offering or marketing materials in respect of the
Bridge Facilities and will have the role and responsibilities customarily
associated with such designation. Except as set forth below, you and we further
agree that no other titles will be awarded and no compensation (other than that
expressly contemplated by this Commitment Letter and the Fee Letter) will be
paid to any Lender (as defined below) in order to obtain its commitment to
participate in the Bridge Facilities unless you and we shall so agree; provided
that you may, on or prior to the date which is 15 business days after the date
of your acceptance of this Commitment Letter (the “Signing Date”), appoint one
or more additional lead arrangers and/or bookrunners for the Bridge Facilities,
and award such lead arrangers and/or bookrunners, additional agent or co-agent,
manager or co-manager titles or confer other titles in a manner and with
economics set forth in the immediately succeeding proviso (it being understood
that, to the extent you appoint any additional lead arrangers, bookrunners,
agents, co-agents, managers or co-managers or confer other titles in respect of
the Bridge Facilities, then, notwithstanding anything in Section 3 to the
contrary, the commitments of BMO in respect of the Bridge Facilities, in each
case pursuant to and in accordance with this proviso, will be permanently
reduced by the amount of the commitments of such appointed entities (or their
relevant affiliates) in respect of each of the Bridge Facilities, with such
reduction allocated in the manner described in clause (y) of the succeeding
proviso, upon the execution by such financial institution (and any relevant
affiliate) of customary joinder documentation and, thereafter, each such
financial institution (and any relevant affiliate) shall constitute a
“Commitment Party,” “Lead Arranger” and/or “Bookrunner” hereunder and it or its
relevant affiliate providing such commitment shall constitute an “Initial
Lender” hereunder); provided, further, that, in connection with the appointment
of any additional lead arranger and/or any bookrunner for the Bridge Facilities
in accordance with the immediately preceding proviso, (x) the aggregate
economics payable to all such additional lead arrangers and/or joint bookrunners
(or any relevant affiliate thereof) in respect of any of the Bridge Facilities
shall not exceed 45% of the total economics that would otherwise be payable to
the Commitment Parties in respect of the Bridge Facilities pursuant to the Fee
Letter (exclusive of any fees payable to the Bridge Administrative Agent in its
capacity as such) and (y) each additional lead arranger and/or bookrunner (or
its relevant affiliates) shall assume a proportion of the commitments with
respect to each of the Bridge Facilities (with such commitments to be allocated
ratably across each of the Bridge Facilities) that is equal to the proportion of
the economics allocated to such lead arranger and/or joint bookrunner.

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3.

Syndication and Approach to Market

The Lead Arranger reserves the right, prior to or after the Closing Date (as
defined below), to syndicate all or a portion of the Initial Lenders’
commitments hereunder to a group of banks, financial institutions and other
institutional lenders and investors (together with the Initial Lenders, the
“Lenders”) identified by the Lead Arranger in consultation with you and
reasonably acceptable to you. Notwithstanding the foregoing, the Lead Arranger
will not syndicate to those banks, financial institutions and other
institutional lenders and investors (i) who are competitors of you and your
subsidiaries and of the Target and its subsidiaries that are separately
identified in writing by you to us from time to time, and (ii) any of their
affiliates (which, for the avoidance of doubt, shall not include any bona fide
debt investment funds that are affiliates of the persons referenced in clause
(i) above) that are either (a) identified in writing by you from time to time or
(b) readily identifiable on the basis of such affiliate’s name (clauses (i) and
(ii) above, collectively “Disqualified Lenders”).

Notwithstanding the Lead Arranger’s right to syndicate the Bridge Facilities and
receive commitments with respect thereto, (i) each of the Initial Lenders shall
not be relieved, released or novated from their obligations hereunder (including
its obligation to fund its portion of the Bridge Facilities on the date of both
the consummation of the Acquisition and the date of the funding under the Bridge
Facilities (the date of such consummation and funding, the “Closing Date”)) in
connection with any syndication, assignment or participation of the Bridge
Facilities, including its commitment in respect thereof, until after the Closing
Date has occurred, (ii) no assignment or novation shall become effective with
respect to all or any portion of the Initial Lenders’ commitments in respect of
the Bridge Facilities until the funding of the Bridge Facilities on the Closing
Date has occurred and (iii) unless you otherwise agree in writing, each
Commitment Party shall retain exclusive control over all rights and obligations
with respect to its commitments and agreements in respect of the Bridge
Facilities, including all rights with respect to consents, modifications,
supplements, waivers and amendments, until after the Closing Date has occurred.

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Without limiting your obligations to assist with syndication efforts as set
forth herein, it is understood that the Commitment Parties’ commitments
hereunder are not conditioned upon the syndication of, or receipt of commitments
in respect of, the Bridge Facilities and in no event shall the commencement or
successful completion of syndication of the Bridge Facilities constitute a
condition to the availability of the Bridge Facilities on the Closing Date. The
Lead Arranger may commence syndication efforts promptly after the Signing Date
and as part of its syndication efforts, it is our intent to have Lenders commit
to the Bridge Facilities prior to the Closing Date (subject to the limitations
set forth in the preceding paragraph). Until the earliest of (a) the date on
which a Successful Syndication (as defined in the Fee Letter) is achieved and
(b) the date that is 60 days following the Closing Date (the “Syndication End
Date”), you agree to actively assist the Lead Arranger in completing a timely
syndication that is reasonably satisfactory to us and you. Such assistance shall
include, until the later of the Syndication End Date and the Closing Date, (i)
your using commercially reasonable efforts to ensure that any syndication
efforts benefit materially from your existing lending and investment banking
relationships and, to the extent appropriate and necessary and not in
contravention of the terms of the Acquisition Agreement, the Target’s existing
lending and investment banking relationships, (ii) direct contact between senior
management, certain representatives and certain relevant non-legal advisors of
you, on the one hand, and the proposed Lenders, on the other hand (and, to the
extent appropriate and necessary and not in contravention of the terms of the
Acquisition Agreement, your using commercially reasonable efforts to arrange for
contact between senior management of the Target, on the one hand, and the
proposed Lenders, on the other hand), in all such cases at times and locations
mutually agreed upon, (iii) your assistance (including, to the extent
appropriate and necessary and not in contravention of the terms of the
Acquisition Agreement, the use of commercially reasonable efforts to cause the
Target to assist) in the preparation of the Information Materials (as defined
below) and other customary offering and marketing materials to be used in
connection with the syndication of the Bridge Facilities, (iv) your using
commercially reasonable efforts to obtain, at your expense, prior to the launch
of general syndication of the Opco Notes, public ratings for the Bridge
Facilities and the Notes (the “Facilities Ratings”) from each of Standard &
Poor’s Ratings Services (“S&P”) and Moody’s Investors Service, Inc. (“Moody’s”)
and a public corporate credit rating and a public corporate family rating
(collectively, the “Corporate Ratings” and, together with the Facilities
Ratings, the “Ratings”) in respect of each of the Holdco Borrower and the Opco
Borrower after giving effect to the Transactions from both of S&P and Moody’s,
respectively, (v) the hosting, with the Lead Arranger, of a reasonable number of
meetings and conference calls to be mutually agreed upon with prospective
Lenders at reasonable times and locations to be mutually agreed upon and upon
reasonable advance notice and (vi) your ensuring that, prior to the later of the
Syndication End Date and the Closing Date, there will not be any competing
issues, offerings, placements or arrangements of debt or equity securities or
commercial bank or other syndicated credit facilities by or on behalf of you or
any of your subsidiaries (and your using commercially reasonable efforts, to the
extent appropriate and necessary and not in contravention of the terms of the
Acquisition Agreement, to cause the Target to ensure that there will not be any
competing issues, offerings, placements or arrangements of debt or equity
securities or commercial bank or other syndicated credit facilities of the
Target or its subsidiaries) being offered, placed or arranged (other than the
Bridge Facilities, the Existing Credit Facilities (as defined in Exhibit A), the
Notes, the Equity Securities or any “demand securities” issued in lieu of the
any of the Notes pursuant to the Fee Letter (the Notes and the “demand
securities”, collectively, the “Takeout Securities”), indebtedness of the Target
and its subsidiaries disclosed in, or otherwise permitted to be issued or
incurred, prior to, or to remain outstanding on, the Closing Date under, the
Acquisition Agreement or other indebtedness that has otherwise been consented to
by the Lead Arranger) without the consent of the Lead Arranger, if such
issuance, offering, placement or arrangement would materially impair the primary
syndication of the Bridge Facilities or the offering of the Notes or the Equity
Securities (it being understood and agreed that your and your subsidiaries’ and
the Target’s and its subsidiaries’ deferred purchase price obligations, ordinary
course working capital facilities and ordinary course capital lease, purchase
money and equipment financings will not be deemed to materially impair the
primary syndication of the Credit Facilities or the offering of the Notes or the
Equity Securities). Notwithstanding anything to the contrary contained in this
Commitment Letter, the Fee Letter or any other letter agreement or undertaking
concerning the financing of the Transactions to the contrary, your obligations
to assist in syndication efforts as provided herein (including commercially
reasonable efforts to obtain the Ratings and the compliance with any of the
provisions set forth in clauses (i) through (vi) above) shall not constitute a
condition to the commitments hereunder or the funding of the Bridge Facilities
on the Closing Date and shall terminate on the later of the Syndication End Date
and the Closing Date.

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Except as otherwise expressly provided herein, the Lead Arranger, in its
capacity as such, will manage all aspects of any syndication of the Bridge
Facilities, in consultation with you, including decisions as to the selection of
institutions to be approached and when they will be approached, when their
commitments will be accepted, which institutions will participate (subject to
your prior consent (not to be unreasonably withheld, delayed or conditioned) ,
but in any event excluding Disqualified Lenders), the allocation of the
commitments among the Lenders and the amount and distribution of fees among the
Lenders. To assist the Lead Arranger in its syndication efforts, you agree to
promptly prepare and provide (and, to the extent appropriate and necessary and
not in contravention of the terms of the Acquisition Agreement, to use
commercially reasonable efforts to cause the Target to provide) to us such
customary information with respect to you, the Target and each of your and their
respective subsidiaries and the Transactions set forth in clause (iii) of the
preceding paragraph, the historical financial information required to be
provided in accordance with paragraphs 4 and 5 of Exhibit D hereto and customary
financial estimates, forecasts and other projections delivered to us by you (the
“Projections”), as the Lead Arranger may reasonably request in connection with
the structuring, arrangement and syndication of the Bridge Facilities. For the
avoidance of doubt, you will not be required to provide any information to the
extent that the provision thereof would violate any law, rule or regulation, or
any obligation of confidentiality binding upon, or waive any attorney-client
privilege of, you, the Target or any of your or their respective subsidiaries or
affiliates. Notwithstanding anything herein to the contrary, the only financial
statements that shall be required to be provided to the Commitment Parties in
connection with the syndication of the Bridge Facilities shall be those required
to be delivered pursuant to paragraphs 4 and 5 of Exhibit D.

You hereby acknowledge that (a) the Lead Arranger will make available
Information (as defined below), Projections and other offering and marketing
material and presentations, including confidential information memoranda to be
used in connection with the syndication of the Bridge Facilities (any such
memorandum, an “Information Memorandum”, and such Information, Projections,
other offering and marketing material and Information Memoranda, collectively
with the Term Sheet, the “Information Materials”) on a confidential basis to the
proposed syndicate of Lenders by posting the Information Materials on Merrill
DataSite, IntraLinks, Debt X, SyndTrak Online, Debtdomain or another similar
electronic system and (b) certain of the Lenders may be “public side” Lenders
(i.e., Lenders that wish to receive only information that (i) is publicly
available, (ii) is not material with respect to you, the Target or your or their
respective subsidiaries or securities for purposes of Canadian provincial,
United States federal and State securities laws or (iii) constitutes information
of the type that would be publicly available if the Target or its subsidiaries
were public reporting companies (as reasonably determined by you) (collectively,
the “Public Side Information”; any information that is not Public Side
Information, “Private Side Information”) and who may be engaged in investment
and other market related activities with respect to you, the Target or your or
their respective subsidiaries or securities (each, a “Public Sider”, and each
Lender that is not a Public Sider, a “Private Sider”). You will be solely
responsible for the contents of the Information Materials and each of the
Commitment Parties shall be entitled to use and rely upon the information
contained therein without responsibility for independent verification thereof.

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At the reasonable request of the Lead Arranger, you agree to assist (and, to
extent appropriate and necessary and not in contravention of the terms of the
Acquisition Agreement, use commercially reasonable efforts to cause the Target
to assist) us in preparing an additional version of the Information Materials to
be used in connection with the syndication of the Bridge Facilities that
includes only Public Side Information with respect to you, the Target and/or any
of your or their respective subsidiaries or securities, to be used by Public
Siders. The Public Side Information will be substantially consistent with the
information that would be included in any offering memorandum for the Takeout
Securities and in any filings made by you and your subsidiaries with the
Securities and Exchange Commission and by the Target or any of its subsidiaries
if the Target and/or its subsidiaries were public reporting companies. It is
understood that in connection with your assistance described above,
authorization letters in a form customarily included in the Information
Materials for bridge financings will be included in any Information Materials
(i.e., separate authorization letters and/or Information Materials containing
only Public Side Information and/or Information Materials containing Private
Side Information) that authorize the distribution of the Information Materials
to prospective Lenders, represent that the additional version of the Information
Materials contains only Public Side Information with respect to you, the Target
and your and its respective subsidiaries and securities (other than as set forth
in the following paragraph of this Section 3), contain the representations set
forth in Section 4 below and exculpate us and our affiliates with respect to any
liability related to the use or misuse of the content of such Information
Materials or related offering and marketing materials by the recipients thereof,
and exculpate you and your subsidiaries, and the Target and its subsidiaries and
affiliates in the event of any unauthorized misuse of the Information Materials
or related offering and marketing materials by the recipients thereof. Before
distribution of any Information Materials, at our reasonable request, you agree
to use commercially reasonable efforts to identify that portion of the
Information Materials that may be distributed to the Public Siders as “Public
Information”, which, at a minimum, shall mean that the word “PUBLIC” shall
appear prominently on the first page thereof. By marking Information Materials
as “PUBLIC”, you shall be deemed to have authorized the Commitment Parties and
the proposed Lenders to treat such Information Materials as containing only
Public Side Information (it being understood that you shall not be under any
obligation to mark the Information Materials “PUBLIC”). We will not make any
materials not marked “PUBLIC” available to Public Siders.

You acknowledge and agree that the following documents, without limitation, may
be distributed to both Private Siders and Public Siders, unless you advise the
Lead Arranger in writing (including by email) within a reasonable time prior to
their intended distribution that such materials should only be distributed to
Private Siders; provided you have been given a reasonable opportunity to review
such materials and comply with provincial securities laws’ disclosure
obligations: (a) administrative materials prepared by the Lead Arranger for
prospective Lenders (such as a lender meeting invitation, bank allocation, if
any, and funding and closing memoranda), (b) term sheet (including revisions
thereto) and notification of changes in the Bridge Facilities’ terms and
conditions and (c) drafts and final versions of the Facilities Documentation. If
you advise us in writing (including by email), within a reasonable period of
time prior to dissemination, that any of the foregoing should be distributed
only to Private Siders, then Public Siders will not receive such materials
without your consent.

The Holdco Borrower covenants and agrees to use commercially reasonable efforts
to access the equity markets on market terms in consultation with BMO and BMOCM
to place, issue or sell Equity Securities as contemplated by paragraph (c) of
Exhibit A on a timely basis on or immediately prior to the Closing Date. From
and after Signing Date until the Expiration Date (as defined below), you agree
not to place, issue or sell any equity securities other than the Equity
Securities without the consent of the Lead Arranger, if such placement, issuance
or sale would materially impair the offering of the Equity Securities as
contemplated by paragraph (c) of Exhibit A. If, after the tenth Business Day (as
defined in Exhibit D) of the Holdco Marketing Period (as defined in Exhibit D),
either the Equity Securities Investment Bank (as defined in Exhibit D)
determines in its reasonable judgment (after consultation with the Holdco
Borrower) or the Holdco Borrower determines in its reasonable judgment (after
consultation with the Equity Securities Investment Bank) that an Equity
Securities Transaction (as defined in Exhibit D) is not reasonably likely to be
consummated by the Closing Date, each of the Holdco Borrower and the Debt
Investment Banks (as defined in Exhibit D) shall use commercially reasonable
efforts to consummate a Holdco Debt Transaction on a timely basis on or
immediately prior to the Closing Date.

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4.

Information

You hereby represent and warrant that (with respect to information relating to
the Target or any of its subsidiaries or any controlled affiliate of any
thereof, subject to compliance with applicable law, to your knowledge), (a) all
written information (such information, other than (i) the Projections and (ii)
information of a general economic or industry specific nature, the
“Information”) that has been or will be made available to any Commitment Party,
directly or indirectly, by you or by any of your representatives on your behalf
in connection with the transactions contemplated hereby, when taken as a whole,
is or will, when furnished, be correct in all material respects and does not or
will not, when furnished and when taken as a whole, contain any untrue statement
of a material fact or omit to state a material fact necessary in order to make
the statements contained therein not materially misleading in light of the
circumstances under which such statements are made (after giving effect to all
supplements and updates thereto from time to time) and (b) the Projections that
have been or will be made available to us by you or your representatives in
connection with the transactions contemplated hereby have been or will be
prepared in good faith based upon assumptions that are believed by you to be
reasonable at the time when made, it being understood that the Projections are
as to future events and are not to be viewed as facts, the Projections are
subject to significant uncertainties and contingencies, many of which are beyond
your control, no assurance can be given that any particular Projections will be
realized and actual results during the period or periods covered by any such
Projections may differ significantly from the projected results and such
differences may be material. You agree that, if at any time prior to the later
of the Syndication End Date and the Closing Date, you become aware that any of
the representations and warranties in the preceding sentence would be incorrect
in any material respect (with respect to information relating to the Target or
any of its subsidiaries or any controlled affiliate of any thereof, subject to
compliance with applicable law, to your knowledge) if the Information and the
Projections were being furnished, and such representations were being made, at
such time, then you will (or, with respect to the Information and such
Projections relating to the Target or any of its subsidiaries or any controlled
affiliated of any thereof, will use commercially reasonable efforts to) promptly
supplement the Information and Projections such that such representations and
warranties are (with respect to information relating to the Target or any of its
subsidiaries or any controlled affiliate of any thereof, subject to compliance
with applicable law, to your knowledge) correct in all material respects under
those circumstances, it being understood that such supplementation shall cure
any breach of such representations and warranties. In arranging and syndicating
the Bridge Facilities, each of the Commitment Parties will be entitled to use
and rely primarily on the Information and the Projections without responsibility
for independent verification thereof and does not assume responsibility for the
accuracy or completeness of the Information or Projections.

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5.

Fees

As consideration for the commitment of the Commitment Parties hereunder and for
the agreement of the Lead Arranger and Bookrunner to perform the services
described herein, you agree to pay (or cause to be paid) the fees set forth in
the Term Sheet and in the Fee Letter dated the date hereof and delivered
herewith with respect to the Bridge Facilities (the “Fee Letter”), if and to the
extent payable. Once paid, except as provided in the Fee Letter or as separately
agreed to in writing by you and us, such fees shall not be refundable under any
circumstances.

6.

Conditions

The commitments of the Commitment Parties hereunder to fund the Bridge
Facilities on the Closing Date is subject solely to (a) the conditions set forth
in the section entitled “Conditions to Borrowing” in each of Exhibit B and
Exhibit C hereto and the conditions set forth in Exhibit D hereto and (b)
delivery of a customary borrowing notice (clauses (a) and (b) subject, on the
Closing Date, to the Certain Funds Provisions (as defined below)); provided that
such notice shall not include (i) any representation or statement as to the
absence (or existence) of any default or event of default under the Facilities
Documentation or (ii) the truth or accuracy of the representations and
warranties set forth in the Facilities Documentation (other than the Specified
Representations (as defined below)) (collectively, the “Conditions”), and, upon
satisfaction (or waiver by the Lead Arranger) of such conditions, the initial
funding of the Bridge Facilities shall occur; it being understood and agreed
that there are no other conditions (implied or otherwise) to the commitments
hereunder, including compliance with the terms of this Commitment Letter, the
Fee Letter and the Facilities Documentation.

Notwithstanding anything in this Commitment Letter (including the immediately
preceding paragraph), the Fee Letter, the Facilities Documentation or any other
agreement or other undertaking concerning the financing of the Transactions to
the contrary, (a) the only representations and warranties the making or accuracy
of which shall be a condition to the availability and funding of the Bridge
Facilities on the Closing Date shall be (i) such of the representations and
warranties made by or with respect to the Target and its subsidiaries and their
respective businesses in the Acquisition Agreement, but only to the extent that
you have (or your applicable affiliate has) the right to terminate your (or its)
obligations under the Acquisition Agreement or decline to consummate the
Acquisition as a result of a breach of such representations and warranties in
the Acquisition Agreement (the “Specified Acquisition Agreement
Representations”) and (ii) the Specified Representations (as defined below) and
(b) the terms of the Facilities Documentation shall be in a form such that they
do not impair the availability or funding of the Bridge Facilities on the
Closing Date if the conditions set forth in the first paragraph of this Section
6 are satisfied or waived by the Lead Arranger (it being understood that to the
extent any security interest in any Collateral (as defined in the Opco Term
Sheet) is not or cannot be provided and/or perfected on the Closing Date (other
than the pledge and perfection of the security interest in (i) the certificated
capital stock of the Opco Borrower owned by the Holdco Borrower, the
certificated capital stock of each of the Opco Borrower’s subsidiaries whose
certificated capital stock is pledged to secure the Existing North American
Revolving Facility and the certificated capital stock of the Target and each of
its wholly owned material U.S. domestic subsidiaries; provided that, to the
extent that you have used commercially reasonable efforts to procure the
delivery thereof prior to the Closing Date, certificated capital stock of the
Target and its subsidiaries will only be required to be delivered on the Closing
Date pursuant to the terms set forth above if such certificates are actually
received from the Seller or the Target and (ii) other assets pursuant to which a
lien may be perfected by the filing of a financing statement under the Uniform
Commercial Code (or equivalent Canadian personal property laws)) after your use
of commercially reasonable efforts to do so or without undue burden or expense,
then the provision and/or perfection of a security interest in such Collateral
shall not constitute a condition precedent to the availability of the Opco
Bridge Facility on the Closing Date but instead shall be required to be
delivered after the Closing Date pursuant to arrangements and timing to be
mutually agreed by the Bridge Administrative Agent and the Opco Borrower but, in
any event, not later than 90 days after the Closing Date or such longer period
as may be agreed by the Bridge Administrative Agent in its reasonable
discretion). For purposes hereof, “Specified Representations” means the
representations and warranties of the applicable Borrower and, with respect to
the Opco Bridge Facility, the guarantors thereof, to be set forth in the
Facilities Documentation relating to existence of the applicable Borrower and,
in the case of the Opco Bridge Facility, the guarantors thereof (but not, for
the avoidance of doubt, the Target and its subsidiaries); organizational power
and authority to enter into the Facilities Documentation; due authorization, due
execution, delivery and enforceability, in each case, relating to the Facilities
Documentation: the incurrence of the loans to be made under the Bridge
Facilities and the provision of the guarantees under the Opco Bridge Facility,
and the granting of the security interests in the Collateral to secure the Opco
Bridge Facility, do not conflict with the organizational documents of the
applicable Borrowers and, in the case of the Opco Bridge Facility only,
guarantors of the Opco Bridge Facility; solvency as of the Closing Date (after
giving effect to the Transactions) of the applicable Borrower and its
subsidiaries on a consolidated basis (such representation and warranty to be
determined in a manner consistent with the manner in which solvency is
determined in the solvency certificate in the form set forth in Annex I to
Exhibit D); Federal Reserve margin regulations; the Investment Company Act; the
incurrence of the loans to be made under the Bridge Facilities and the use of
proceeds thereof not violating anti-terrorism laws, including the PATRIOT Act,
OFAC and the FCPA, Part II.1 of the Criminal Code (Canada), the Special Economic
Measures Act (Canada), the United Nations Act (Canada), the Proceeds of Crime
(Money Laundering) and Terrorist Financing Act (Canada), with respect to the
Opco Bridge Facility only, subject to the parenthetical in the immediately
preceding sentence, creation, perfection and validity of security interests in
the Collateral. This paragraph and the provisions herein shall be referred to as
the “Certain Funds Provisions”.

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The definitive documentation for the each of Bridge Facilities (the “Facilities
Documentation”) shall be drafted initially by counsel for the Borrowers and
shall (a) contain the terms set forth in the Term Sheet set forth in Exhibit B
or Exhibit C hereto, as applicable, and shall contain only those conditions
precedent, mandatory prepayments, representations and warranties, affirmative
and negative covenants, financial covenants and events of default expressly set
forth in such Term Sheet and, to the extent such terms are not expressly set
forth in such Term Sheet, such other terms that are based on the Senior Secured
Notes Indenture dated as of January 18, 2013 between Wells Enterprises, Inc. and
U.S. Bank National Association, as Trustee and Notes Collateral Agent, governing
its 6.75% Senior Secured Notes due 2020(provided that the security documentation
with respect to the Opco Bridge Facility and any related term loans, exchange
notes or Takeout Securities shall be based on the security documentation for the
Existing North American Credit Facility (as defined on Exhibit A hereto)) and
such other terms as the Borrowers and Lead Arranger shall reasonably agree, (b)
give due regard to the operational requirements of the applicable Borrower and
its subsidiaries in light of their size, structure, industries, businesses,
business practices, matters disclosed in the Acquisition Agreement and proposed
business plan and operations, and (c) negotiated in good faith by the applicable
Borrower and the Lead Arranger within a reasonable period of time to be
determined based on the expected Closing Date and taking into account the timing
of the syndication of the Bridge Facilities and the pre-closing requirements of
the Acquisition Agreement. To the extent any of the Specified Representations
are qualified by or subject to “material adverse effect”, the definition thereof
shall be “Material Adverse Effect” (as defined in the Acquisition Agreement) for
purposes of any representations and warranties made or to be made on, or as of,
the Closing Date only (or a date prior thereto). This paragraph and the
provisions herein are referred to as the “Documentation Principles”.

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7.

Expenses and Indemnity

To induce the Commitment Parties to enter into this Commitment Letter and the
Fee Letter and to proceed with the documentation of the Bridge Facilities, you
agree:

 

(a)

to the extent that the Closing Date occurs, to reimburse each Commitment Party
from time to time, upon presentation of a summary statement, for all reasonable,
documented and invoiced out-of-pocket expenses, due diligence expenses,
syndication expenses, travel expenses and reasonable fees, disbursements and
other charges of Paul Hastings LLP and Goodmans LLP, US and Canadian counsel,
respectively, to the Commitment Parties, and, if necessary and consented to by
you, of local counsel to the Commitment Parties in each appropriate
jurisdiction, in each case incurred in connection with the Bridge Facilities and
the preparation, negotiation and enforcement of this Commitment Letter, the Fee
Letter, the Facilities Documentation and any security arrangements in connection
therewith; provided that, in the event that the Transactions are not consummated
or the Closing Date does not occur, your reimbursement obligations for expenses
of BMO and BMOCM are governed by that certain letter agreement dated June 23,
2015 between you and BMO and BMOCM (the “Expense Letter”). The foregoing
provisions in this paragraph shall be superseded in each case, to the extent
covered thereby, by the applicable provisions contained in the Facilities
Documentation upon execution thereof and thereafter shall have no further force
and effect, and

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(b)

to indemnify and hold harmless each Commitment Party, their respective
affiliates and the respective officers, directors, employees, agents,
controlling persons, members, advisors and other representatives and the
successors and permitted assigns of each of the foregoing (each, an “Indemnified
Person”), from and against any and all losses, claims, damages and liabilities
of any kind or nature and reasonable, documented and invoiced out-of-pocket fees
and expenses, joint or several, to which any such Indemnified Person may become
subject to the extent arising out of, resulting from or in connection with, any
claim, litigation, investigation or proceeding (including any inquiry or
investigation), actual or threatened, relating to any of the foregoing (any of
the foregoing, a “Proceeding”) in connection with this Commitment Letter, the
Fee Letter, the Transactions or any related transaction contemplated hereby or
thereby, the Bridge Facilities or any use of the proceeds thereof, regardless of
whether any such Indemnified Person is a party thereto and whether or not such
Proceeding is brought by you, your equityholders, your affiliates, creditors or
any other third person, and to reimburse each such Indemnified Person within 30
days of any written demand for any reasonable and documented or invoiced
out-of-pocket legal fees and expenses incurred in connection with investigating,
responding to, or defending any of the foregoing of one firm of counsel for all
such Indemnified Persons, taken as a whole and, if necessary, of a single firm
of local counsel in each appropriate jurisdiction (which may include a single
firm of special counsel acting in multiple jurisdictions) for all such
Indemnified Persons, taken as a whole (and, solely in the case of an actual or
perceived conflict of interest where the Indemnified Person affected by such
conflict notifies you of the existence of such conflict and thereafter retains
its own counsel, of one other firm of counsel for such affected Indemnified
Person) or other reasonable and documented or invoiced out-of-pocket fees and
expenses incurred in connection with investigating, responding to, or defending
any of the foregoing; provided that the foregoing indemnity will not, as to any
Indemnified Person, apply to any loss, claim, damage, liability, cost or expense
to the extent it has been determined by a court of competent jurisdiction in a
final, non-appealable judgment to have resulted from (i) the willful misconduct,
bad faith or gross negligence of such Indemnified Person or any of its
affiliates or any of its or their respective officers, directors, partners,
members, employees, agents, advisors or other representatives or successors and
assigns of any of the foregoing, (ii) a material breach of the obligations under
this Commitment Letter, the Fee Letter or the Facilities Documentation of such
Indemnified Person or any of such Indemnified Person’s affiliates or of any of
its or their respective officers, directors, partners, members, employees,
agents, advisors or other representatives or successors and assigns of any of
the foregoing, (iii) in the case of a Proceeding initiated by you or one of your
subsidiaries against the relevant Indemnified Person, a breach of the
obligations under this Commitment Letter or the Term Sheets, the Fee Letter or
the Facilities Documentation by such Indemnified Person or any of such
Indemnified Person’s affiliates or of any of its or their respective officers,
directors, partners, members, employees, agents, advisors or other
representatives or successors and assigns of any of the foregoing or (iv) any
Proceeding that does not arise from any act or omission by you or any of your
affiliates and that is brought by any Indemnified Person against any other
Indemnified Person; provided that the Bridge Administrative Agent, the Lead
Arranger and the Bookrunner to the extent fulfilling their respective roles as
an agent or arranger under the Bridge Facilities and in their capacities as
such, shall remain indemnified in respect of such Proceedings to the extent that
none of the exceptions set forth in any of clauses (i), (ii) and (iii) of the
immediately preceding proviso applies to such person at such time.

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Notwithstanding any other provision of this Commitment Letter, (a) no
Indemnified Person shall be liable for any damages arising from the use by
others of information or other materials obtained through internet, electronic,
telecommunications or other information transmission systems, except to the
extent that such damages have resulted from the willful misconduct, bad faith or
gross negligence of such Indemnified Person or any of its affiliates or any of
its or their respective equityholders, officers, directors, partners, employees,
agents, controlling persons, members, advisors or other representatives (as
determined by a court of competent jurisdiction in a final non-appealable
judgment) and (b) none of you, the Indemnified Persons, the Target, or any of
your or their respective affiliates or the respective directors, officers,
employees, advisors and agents of the foregoing shall be liable for any
indirect, special, punitive or consequential damages (including, without
limitation, any loss of profits, business or anticipated savings) in connection
with this Commitment Letter, the Fee Letter, the Transactions (including the
Bridge Facilities and the use of proceeds thereunder), or with respect to any
activities related to the Bridge Facilities, including the preparation of this
Commitment Letter, the Fee Letter and the Facilities Documentation; provided
that nothing in this sentence shall limit your indemnification obligations to
the extent set forth herein to the extent such indirect, special, punitive or
consequential damages are included in any third party claim in connection with
which such Indemnified Person is entitled to indemnification hereunder.

You shall not be liable for any settlement of any Proceeding effected without
your written consent (which consent shall not be unreasonably withheld or
delayed, it being understood that the withholding of consent due to
non-satisfaction of any of the conditions described in clauses (i) and (ii) of
the succeeding paragraph (with “you” being substituted for “such Indemnified
Person” in each such clause) shall be deemed reasonable), but if settled with
your written consent or if there is a final and non-appealable judgment by a
court of competent jurisdiction for the plaintiff in any such Proceeding, you
agree to indemnify and hold harmless each Indemnified Person from and against
any and all losses and reasonable and documented or invoiced legal or other
out-of-pocket expenses by reason of such settlement or judgment in accordance
with and to the extent provided in the other provisions of this Section 7. If
the Indemnifying Party has reimbursed any Indemnified Person for any legal or
other expenses in accordance with such request and there is a final and
non-appealable determination by a court of competent jurisdiction that the
Indemnified Person was not entitled to indemnification or contribution rights
with respect to such payment pursuant to this Section 7, then the Indemnified
Person shall promptly refund such amount.

You shall not, without the prior written consent of any Indemnified Person
(which consent shall not be unreasonably withheld or delayed, it being
understood that the withholding of consent due to non-satisfaction of any of the
conditions described in clauses (i) and (ii) of this sentence shall be deemed
reasonable), effect any settlement of any pending or threatened Proceeding in
respect of which indemnity could have been sought hereunder by such Indemnified
Person unless such settlement (i) includes an unconditional release of such
Indemnified Person in form and substance reasonably satisfactory to such
Indemnified Person from all liability or claims that are the subject matter of
such Proceeding and (ii) does not include any statement as to or any admission
of fault, culpability, wrongdoing or a failure to act by or on behalf of such
Indemnified Person.

Each Indemnified Person shall, in consultation with you, give (subject to
confidentiality or legal restrictions) such information and assistance to you as
you may reasonably request in connection with any Proceeding in connection with
any losses, claims, damages, liabilities and expenses.

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8.

Sharing of Information, Absence of Fiduciary Relationships, Affiliate Activities

You acknowledge that the Commitment Parties and their respective affiliates may
be providing debt financing, equity capital or other services (including,
without limitation, investment banking and financial advisory services,
securities trading, hedging, financing and brokerage activities and financial
planning and benefits counseling) to other persons in respect of which you, the
Target and your and their respective affiliates may have conflicting interests
regarding the transactions described herein and otherwise (including, without
limitation, that BMO or one of its affiliates is the administrative agent and a
lender under the Existing North American Facility and under the credit facility
of the Target). None of the Commitment Parties or their respective affiliates
will use confidential information obtained from you, the Target or your or its
affiliates or representatives by virtue of the transactions contemplated by this
Commitment Letter or their other relationships with you in connection with the
performance by them or their respective affiliates of services for other
persons, and none of the Commitment Parties or their affiliates will furnish any
such information to other persons, except to the extent expressly permitted in
Section 9. You also acknowledge that none of the Commitment Parties or their
affiliates has any obligation to use in connection with the transactions
contemplated by this Commitment Letter, or to furnish to you, confidential
information obtained by them from other persons.

As you know, the Commitment Parties and their affiliates are full service
securities firms engaged, either directly or through their affiliates, in
various activities, including securities trading, commodities trading,
investment management, financing and brokerage activities and financial planning
and benefits counseling for both companies and individuals. In the ordinary
course of these activities, the Commitment Parties and their affiliates may
actively engage in commodities trading or trade the debt and equity securities
(or related derivative securities) and financial instruments (including bank
loans and other obligations) of you, the Target, any of your or their respective
subsidiaries and affiliates and other companies which may be the subject of the
arrangements contemplated by this Commitment Letter for their own account and
for the accounts of their customers and may at any time hold long and short
positions in such securities. The Commitment Parties and their affiliates may
also co-invest with, make direct investments in, and invest or co-invest client
monies in or with funds or other investment vehicles managed by other parties,
and such funds or other investment vehicles may trade or make investments in
securities of you, the Target, any of your or their respective subsidiaries and
affiliates or other companies which may be the subject of the arrangements
contemplated by this Commitment Letter or engage in commodities trading with any
thereof. The Commitment Parties and their respective affiliates may have
economic interests that conflict with those of you or the Target. You agree that
the Commitment Parties will act under this Commitment Letter as independent
contractors and that nothing in this Commitment Letter or the Fee Letter will be
deemed to create an advisory, fiduciary or agency relationship or fiduciary or
other implied duty between the Commitment Parties and you or the Target, your or
their respective equityholders or your or their respective affiliates. You
acknowledge and agree that (a) the transactions contemplated by this Commitment
Letter and the Fee Letter are arm’s-length commercial transactions between the
Commitment Parties and, if applicable, their affiliates, on the one hand, and
you, on the other, (b) in connection therewith and with the process leading to
such transactions, each Commitment Party and its applicable affiliates (as the
case may be) are acting solely as principals and not as agents or fiduciaries of
you, the Target, your or their respective management, equityholders, creditors
or affiliates or any other person, (c) the Commitment Parties and their
applicable affiliates (as the case may be) have not assumed an advisory or
fiduciary responsibility or any other obligation in favor of you or your
affiliates with respect to the transactions contemplated hereby or the process
leading thereto (irrespective of whether the Commitment Parties or any of their
respective affiliates have advised or are currently advising you or the Target
on other matters), except the obligations expressly set forth in this Commitment
Letter and the Fee Letter, (d) you have consulted your own legal, accounting and
financial advisory, regulatory and tax advisors to the extent you deem
appropriate and (e) you are responsible for making your own independent judgment
with respect to such transactions and the process leading thereto. Please note
that the Commitment Parties and their affiliates have not provided any legal,
accounting, regulatory or tax advice. You agree that you will not claim, and
hereby waive any such claim, that the Commitment Parties or their applicable
affiliates, as the case may be, have rendered advisory services of any nature or
respect, or owe a fiduciary or similar duty to you or your affiliates, in
connection with such transaction or the process leading thereto.

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9.

Confidentiality

You agree that you will not disclose, directly or indirectly, the Fee Letter or
the contents thereof or, prior to your acceptance hereof, this Commitment Letter
or the contents hereof (including the Term Sheets and other Exhibits and
attachments hereto) to any person or entity without the prior written approval
of the Lead Arranger (such approval not to be unreasonably withheld, delayed or
conditioned), except (a) your affiliates, officers, directors, agents,
employees, attorneys, accountants, advisors, members or partners, in each case
who are informed of the confidential nature of this Commitment Letter, the Fee
Letter and the contents hereof and thereof and who are or have been advised of
their obligation to keep the same confidential, (b) if the Commitment Parties
consent in writing to such proposed disclosure or (c) pursuant to the order of
any court or administrative agency in any pending legal, judicial or
administrative proceeding, or otherwise as required by applicable law, rule,
regulation or compulsory legal process or to the extent requested or required by
governmental and/or regulatory authorities, in each case based on the reasonable
advice of your legal counsel (in which case you agree, to the extent practicable
and not prohibited by applicable law, rule or regulation to inform us promptly
thereof prior to disclosure); provided that (i) you may disclose this Commitment
Letter and its contents (but not the Fee Letter or its contents), to the
Sellers, the Target, the Target’s subsidiaries and the respective officers,
directors, agents, employees, attorneys, accountants, advisors, members,
partners, stockholders, controlling persons or equityholders of the foregoing
who are informed of the confidential nature of this Commitment Letter and the
contents hereof and thereof and who are or have been advised of their obligation
to keep the same confidential, (ii) you may disclose this Commitment Letter and
its contents (but not the Fee Letter or its contents) in any offering memorandum
related to the Takeout Securities or the Equity Securities (or any other debt or
equity securities issued in lieu of the Takeout Securities or the Equity
Securities or the Bridge Facilities), in any syndication or other marketing
materials in connection with the Bridge Facilities (including the Information
Materials) or in connection with any public or regulatory filing requirement
relating to the Transactions, (iii) you may disclose the Term Sheets and other
Exhibits and annexes to the Commitment Letter, and the contents thereof, to
potential Lenders and their affiliates involved in any related commitments and
to rating agencies in connection with obtaining the Ratings, (iv) you may
disclose the aggregate fee amount contained in the Fee Letter as part of
Projections, pro forma information or a generic disclosure of aggregate sources
and uses related to fee amounts in connection with the Transactions to the
extent customary or required in offering and marketing materials for the Bridge
Facilities, the Takeout Securities or the Equity Securities (or any other debt
or equity securities issued in lieu of the Takeout Securities, the Equity
Securities or the Bridge Facilities) or to the extent customary or required, in
any public or regulatory filing requirement relating to the Transactions, (v)
you may make public disclosure of the existence and amount of the commitments
hereunder and of the identity of the Bridge Administrative Agent, Bookrunner and
Lead Arranger, (vi) to the extent portions thereof have been redacted in a
manner to be reasonably satisfactory to us and you (including the portions
thereof addressing fees payable to the Commitment Parties and/or the Lenders),
you may disclose the Fee Letter and the contents thereof to the Sellers, the
Target, the Target’s subsidiaries and the respective officers, directors,
agents, employees, attorneys, accountants, advisors, members, partners,
stockholders, controlling persons or equityholders of the foregoing on a
confidential and need to know basis, (vii) you may disclose this Commitment
Letter, the Fee Letter and the contents hereof and thereof to the extent this
Commitment Letter, the Fee Letter or the contents hereof or thereof, as
applicable, become publicly available other than by reason of disclosure by you
in breach of this Commitment Letter, and (viii) you may disclose this Commitment
Letter, the Fee Letter and the contents hereof and thereof to any prospective
additional lead arranger or additional bookrunner, in either case to the extent
in contemplation of appointing such person pursuant to the provisions of the
first proviso set forth in Section 2 of this Commitment Letter and to any such
person’s affiliates and its and their respective officers, directors, employees,
agents, attorneys, accountants, advisors, members, partners, stockholders,
controlling persons and equityholders who agree to be bound by the
confidentiality restrictions with respect thereto on substantially the terms set
forth in this paragraph.

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The Commitment Parties and their affiliates will use all information provided to
them or such affiliates by or on behalf of you hereunder or in connection with
the Acquisition and the other Transactions solely for the purpose of providing
the services which are the subject of this Commitment Letter and shall treat
confidentially all such information and shall not publish, disclose or otherwise
divulge such information; provided that nothing herein shall prevent the
Commitment Parties or their affiliates from disclosing any such information (a)
pursuant to the order of any court or administrative agency or in any pending
legal, judicial or administrative proceeding, or otherwise as required by
applicable law, rule, regulation or compulsory legal process based on the advice
of counsel (in which case the Commitment Parties agree (except with respect to
any audit or examination conducted by bank accountants or any governmental bank
regulatory authority exercising examination or regulatory authority), to the
extent practicable and not prohibited by applicable law, rule or regulation, to
inform you promptly thereof prior to disclosure), (b) upon the request or demand
of any regulatory authority having jurisdiction over the Commitment Parties or
any of their respective affiliates (in which case the Commitment Parties agree
(except with respect to any audit or examination conducted by bank accountants
or any governmental bank regulatory authority exercising examination or
regulatory authority), to the extent practicable and not prohibited by
applicable law, rule or regulation to inform you promptly thereof prior to
disclosure), (c) to the extent that such information becomes publicly available
other than by reason of improper disclosure by the Commitment Parties or any of
their affiliates or any related parties thereto in violation of any
confidentiality obligations owing to you, the Target, the Sellers or any of your
or their respective affiliates (including those set forth in this paragraph) or
to the extent any such information is developed independently by us without the
use of any other confidential information, (d) to the extent that such
information is received by the Commitment Parties from a third party that is
not, to the Commitment Parties’ knowledge, subject to contractual or fiduciary
confidentiality obligations owing to you, the Target, the Sellers or any of your
or their respective affiliates or related parties, (e) to the Commitment
Parties’ affiliates and to their respective officers, directors, employees,
legal counsel, independent auditors, professionals and other experts or agents
who need to know such information in connection with the Transactions and who
are informed of the confidential nature of such information and who are subject
to customary confidentiality obligations of professional practice or who agree
to be bound by the terms of this paragraph (or language substantially similar
to, or no less restrictive than, this paragraph) (with each such Commitment
Party responsible for each such person’s compliance with this paragraph), (f) to
potential or prospective Lenders, participants or assignees and to any direct or
indirect contractual counterparty to any swap or derivative transaction (each a
“Swap Counterparty”) relating to the Borrowers or any of its subsidiaries, in
each case who agree to be bound by the terms of this paragraph (or language
substantially similar to, or no less restrictive than, this paragraph); provided
that the disclosure of any such information to any Lenders, participants,
assignees or Swap Counterparties or prospective Lenders, participants, assignees
or Swap Counterparties referred to above shall be made subject to the
acknowledgment and acceptance by such Lender, participant, assignee or Swap
Counterparty or prospective Lender, participant, assignee or Swap Counterparty
that such information is being disseminated on a confidential basis (on
substantially the terms set forth in this paragraph or as is otherwise
reasonably acceptable to you and such Commitment Party, including as expressly
agreed in any Information Materials or other marketing materials) in accordance
with the standard syndication processes of such Commitment Party or customary
market standards for dissemination of such type of information, (g) for purposes
of establishing a “due diligence” defense in connection with or arising out of
the issuance of securities or making of loans pursuant to this Commitment Letter
(h) with your prior written consent, to rating agencies on a confidential basis
in connection with obtaining the Ratings, (i) in connection with the exercise of
any remedy or enforcement of any rights hereunder in any litigation or
arbitration action or proceeding relating thereto, to the extent such disclosure
is reasonably necessary in connection with such litigation or arbitration action
or proceeding (provided that you shall be given notice thereof and a reasonable
opportunity to seek a protective court order with respect to such information
prior to such disclosure (it being understood that the refusal by a court to
grant such a protective order shall not prevent the disclosure of such
information thereafter) and (j) with your prior written consent. In the event
that the Bridge Facilities are funded, the Commitment Parties’ and their
respective affiliates’, if any, obligations under this paragraph shall be
superseded by the confidentiality provisions in the Facilities Documentation, to
the extent covered thereby, upon the initial funding thereunder. Otherwise, the
confidentiality provisions set forth in this paragraph shall survive the
termination of this Commitment Letter and expire and shall be of no further
effect on the date occurring on the second anniversary after the date hereof.

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10.

Miscellaneous

This Commitment Letter and the commitments hereunder shall not be assignable by
any party hereto (other than subject to the limitations set forth in Section 3,
by the Commitment Parties to any other Lender) without the prior written consent
of each other party hereto (and any attempted assignment without such consent
shall be null and void). This Commitment Letter and the commitments hereunder
are intended to be solely for the benefit of the parties hereto (and Indemnified
Persons to the extent expressly set forth herein) and are not intended to and do
not confer any benefits upon, or create any rights in favor of, any person other
than the parties hereto (and Indemnified Persons to the extent expressly set
forth herein). Subject to the limitations set forth in Section 3 above, the
Commitment Parties reserve the right to employ the services of their respective
affiliates or branches in providing services contemplated hereby and to
allocate, in whole or in part, to their affiliates or branches certain fees
payable to the Commitment Parties in such manner as the Commitment Parties and
their affiliates or branches may agree in their sole discretion and, to the
extent so employed, such affiliates or branches shall be entitled to the
benefits and protections afforded to, and subject to the provisions governing
the conduct of, the Commitment Parties hereunder (provided that the Commitment
Parties shall be liable for the actions or inactions of any such person whose
services are so employed). This Commitment Letter may not be amended or any
provision hereof waived or modified except by an instrument in writing signed by
each of the Commitment Parties and you. This Commitment Letter may be executed
in any number of counterparts, each of which shall be deemed an original and all
of which, when taken together, shall constitute one agreement. Delivery of an
executed counterpart of a signature page of this Commitment Letter by facsimile
transmission or other electronic transmission (e.g., a “PDF” or “TIFF”) shall be
effective as delivery of a manually executed counterpart hereof. This Commitment
Letter (including the Exhibits hereto), together with the Fee Letter and the
Expense Letter, (i) are the only agreements that have been entered into among
the parties hereto with respect to the Bridge Facilities, and (ii) supersede all
prior understandings, whether written or oral, among us with respect to the
Bridge Facilities and set forth the entire understanding of the parties hereto
with respect thereto.

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This Commitment Letter and the Fee Letter shall be governed by, and construed in
accordance with the laws of the State of New York; provided that,
notwithstanding the foregoing, it is understood and agreed that (a) the
interpretation of the definition of “Material Adverse Effect” (as defined in
Exhibit D) (and whether or not a Material Adverse Effect has occurred), (b) the
determination of the accuracy of any Specified Acquisition Agreement
Representations and whether as a result of any inaccuracy thereof you (or your
affiliate) have the right (taking into account any applicable cure provisions)
to terminate your (or its) obligations under the Acquisition Agreement or
decline to consummate the Acquisition and (c) the determination of whether the
Acquisition has been consummated in accordance with the terms of the Acquisition
Agreement, in each case shall be governed by, and construed in accordance with,
the laws of the State of Delaware, regardless of the laws that might otherwise
govern under applicable principles of conflicts of laws thereof.

EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES ANY RIGHT TO TRIAL BY JURY IN ANY
ACTION, PROCEEDING, SUIT, CLAIM OR COUNTERCLAIM BROUGHT BY OR ON BEHALF OF ANY
PARTY RELATED TO OR ARISING OUT OF THE TRANSACTIONS, THIS COMMITMENT LETTER, THE
FEE LETTER OR THE PERFORMANCE OF SERVICES HEREUNDER OR THEREUNDER. The parties
hereto hereby submit to the exclusive jurisdiction of the federal and state
courts located in the Borough of Manhattan in the City of New York (or any
appellate court therefrom) in connection with any dispute related to this
Commitment Letter or the Fee Letter or any matters contemplated hereby or
thereby, and agree that any service of process, summons, notice or document by
registered mail addressed to such party shall be effective service of process
for any suit, action or proceeding relating to any such dispute . Each of the
parties hereto irrevocably and unconditionally waives any objection to the
laying of venue of any such suit, action or proceeding brought in any such court
and any claim that any such suit, action or proceeding has been brought in an
inconvenient forum. A final judgment in any such suit, action or proceeding
brought in any such court may be enforced in any other jurisdiction where such
party is or may be subject by suit upon judgment. Each of the parties hereto
agrees that service of process, summons, notice or document by registered mail
addressed to you or us at the addresses set forth above shall be effective
service of process for any suit, action or proceeding brought in any such court.

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We hereby notify you that pursuant to the requirements of Proceeds of Crime
(Money Laundering) and Terrorist Financing Act (Canada) and the USA Patriot Act
(Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (together, the
“AML Law”), each of us and each of the Lenders may be required to obtain, verify
and record information that identifies the Borrowers and the Guarantors, which
information may include their names, addresses, tax identification numbers and
other information that will allow each of us and the Lenders to identify the
Borrowers and the Guarantors in accordance with AML Law. This notice is given in
accordance with the requirements of AML Law and is effective for each of us and
the Lenders.

The indemnification, compensation (if applicable), reimbursement (if
applicable), sharing of information, absence of fiduciary relationships, no
agency, affiliate activities, jurisdiction, governing law, venue, waiver of jury
trial, syndication (including the “Market Flex” provisions in the Fee Letter)
and confidentiality provisions contained herein and in the Fee Letter shall
remain in full force and effect regardless of whether Facilities Documentation
shall be executed and delivered and notwithstanding the termination or
expiration of this Commitment Letter or the Commitment Parties’ commitments
hereunder; provided that your obligations under this Commitment Letter (other
than your obligations with respect to (a) assistance to be provided in
connection with the syndication of such commitments (including supplementing
and/or correcting Information and Projections) prior to the later of the
Syndication End Date and the Closing Date and (b) confidentiality of the Fee
Letter and the contents thereof) shall automatically terminate and be superseded
by the provisions of the Facilities Documentation upon the initial funding
thereunder, and you shall automatically be released from all liability in
connection therewith at such time. You may terminate this Commitment Letter
and/or the Commitment Parties’ commitment with respect to the Bridge Facilities
hereunder at any time subject to the provisions of the preceding sentence. In
addition, in the event that a lesser amount of indebtedness is required to fund
the Transactions for any reason, you may reduce the Initial Lenders’ commitments
with respect to the Bridge Facilities (on a pro rata basis amongst the Initial
Lenders) in a manner consistent with the allocation of purchase price reduction
described under paragraph 1 of Exhibit D and subject to the minimum size of the
Opco Bridge Facility and the Opco Notes set forth therein.

Section headings used herein are for convenience of reference only and are not
to affect the construction of, or to be taken into consideration in
interpreting, this Commitment Letter.

If the foregoing correctly sets forth our agreement, please indicate your
acceptance of the terms of this Commitment Letter and the Fee Letter by
returning to BMOCM on behalf of the Commitment Parties, executed counterparts
hereof and of the Fee Letter not later than 11:59 p.m., New York time, on August
3, 2015. The Commitment Parties’ commitment and the obligation of the Lead
Arranger hereunder will expire at such time in the event that the Commitment
Parties have not received such executed counterparts in accordance with the
immediately preceding sentence. If you do so execute and deliver to us this
Commitment Letter and the Fee Letter, we agree to hold our commitment available
for you until the earliest of (i) after execution of the Acquisition Agreement
and prior to the consummation of the Transactions, the termination of the
Acquisition Agreement by you (or your affiliates) or with your (or your
affiliates’) written consent in accordance with its terms (other than with
respect to provisions therein that expressly survive termination) in the event
that the Acquisition is not consummated, (ii) the consummation of the
Acquisition with or without the funding of the Bridge Facilities and (iii) 11:59
p.m., New York time, on the Outside Date (as defined in the Acquisition
Agreement as in effect on the date hereof); provided that the Outside Date may
be extended up to February 3, 2016 by the Sellers’ Representative or the
Purchaser in accordance with Section 9.1(b)(i) of the Acquisition Agreement if
(x) all conditions to closing set forth in Article VIII of the Acquisition
Agreement are satisfied or waived other than the conditions set forth in Section
8.1 thereof and conditions that by their nature are to be satisfied at the
Closing (as defined in the Acqusition Agreement) and (y) the parties to the
Acquisition Agreement are still actively seeking in good faith approval under
the HSR Act (as defined in the Acquisition Agreement); provided, further, that
the Outside Date may be extended up to February 3, 2016 by the Sellers’
Representative in accordance with Section 9.1(b)(i) of the Acquisition Agreement
if (x) all conditions to closing set forth in Article VIII of the Acquisition
Agreement are satisfied or waived other than conditions that by their nature are
to be satisfied at the Closing (as defined in the Acqusition Agreement) and (y)
the Closing (as defined in the Acquisition Agreement) has not occurred (such
earliest date, the “Expiration Date”). Upon the occurrence of any of the events
referred to in the preceding sentence, this Commitment Letter and the
commitments of each of the Commitment Parties hereunder and the agreement of the
Lead Arranger to provide the services described herein shall automatically
terminate unless the Commitment Parties shall, in their discretion, agree to an
extension in writing.

18

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19

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We are pleased to have been given the opportunity to assist you in connection
with the financing for the Transactions.

Very truly yours,   BANK OF MONTREAL     By:   /s/ James J. Goll Name: James J.
Goll   Title: Managing Director     BMO CAPITAL MARKETS CORP.     By:    /s/
James J. Goll Name: James J. Goll   Title: Managing Director

[SIGNATURE PAGE TO COMMITMENT LETTER]

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Accepted and agreed to as of the date first written above:

  SUNOPTA INC.              By: /s/ Rick Albert   Name: Rick Albert   Title:
Treasurer               SUNOPTA FOODS INC.      By: /s/ Rick Albert   Name: Rick
Albert   Title: Treasurer

[SIGNATURE PAGE TO COMMITMENT LETTER]

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EXHIBIT A

PROJECT SHINE
TRANSACTION DESCRIPTION

Capitalized terms used but not defined in this Exhibit A shall have the meanings
given to them in the Commitment Letter to which this Exhibit A is attached,
including the other Exhibits thereto. In the event any such capitalized term is
subject to multiple or differing definitions, the appropriate meaning thereof in
this Exhibit A shall be determined by reference to the context in which it is
used.

SunOpta Inc. and/or a wholly-owned subsidiary owned by SunOpta Inc.
(“Purchaser”) intends to acquire (the “Acquisition”) the capital stock of
Sunrise Holdings (Delaware), Inc., a Delaware corporation (the “Target”), from
the sellers named on Schedule I to the Acquisition Agreement (collectively, the
“Sellers”).

In connection therewith, it is intended that:

 

(a)

Purchaser will consummate the Acquisition pursuant to that certain Purchase and
Sale Agreement, dated as of July 30, 2015 (together with all exhibits, annexes,
schedules and other disclosure letters thereto, collectively, as modified,
amended, supplemented, consented to or waived, the “Acquisition Agreement”), by
and among the Sellers, Shine Seller Rep, LLC (the “Sellers’ Representative”) and
the Purchaser, the Sellers will sell all of the equity interest in the Target to
Purchaser and the Sellers will receive cash in exchange for their equity
interests in the Target (the “Acquisition Consideration”).

 

 

 

 

(b)

the Opco Borrower will enter into a consent and waiver (the “Existing North
American Credit Facility Amendment”) to its seventh amended and restated
revolving credit agreement dated July 27, 2012 (as amended, the “Existing North
American Credit Facility” and, together with the Organic Corporation B.V.’s
amended and restated multipurpose facilities agreement dated September 25, 2012
(as amended, the “Existing European Credit Facility”), the “Existing Credit
Facilities”) to cause the Transactions to be permitted (together with any other
amendments that are requested by the Opco Borrower).

 

 

 

 

(c)

The Holdco Borrower or an affiliate thereof will, at its option, either (i)
issue and sell its common capital stock in US dollars only (the “Equity
Securities”) in a public registered offering and/or a private placement in the
US on or before the Closing Date (it being understood that a portion of the
offering of Equity Securities may also be placed in Canada on a private basis
only) yielding $140.0 million (the “Stock/Holdco Bridge Amount”) in gross cash
proceeds and/or (ii) to the extent that Equity Securities (and/or other equity
or equity-linked securities) yielding gross proceeds of less than the
Stock/Holdco Bridge Amount are issued on or before the Closing Date, issue and
sell unsecured, subordinated PIK-toggle notes (the “Holdco PIK Notes”) in a
private placement offering in the US under Rule 144A or other private placement
(it being understood that a portion of the offering of the Holdco PIK Notes may
also be placed in Canada on a private basis only) yielding gross proceeds in US
dollars that, when added to the gross proceeds received from the issuance of
Equity Securities under clause (c)(i) above does not exceed the Stock/Holdco
Bridge Amount and/or (iii) to the extent that Equity Securities (and/or other
equity linked securities) and Holdco PIK Notes collectively yielding gross cash
proceeds of less than the Stock/Holdco Bridge Amount are issued on or before the
Closing Date under clauses (c)(i) or (c)(ii), obtain increasing rate bridge
loans under the credit facility described in Exhibit B to the Commitment letter
(the “Holdco Bridge Facility”) in an aggregate principal amount that, when added
to the amount of gross proceeds raised from the issuance of such Equity
Securities (and/or other equity or equity-linked securities) and Holdco PIK
Notes is equal to the Stock/Holdco Bridge Amount; provided that, to the extent
that (i) the gross proceeds from the issuance of Equity Securities (and/or other
equity or equity-linked securities) and/or Holdco PIK Notes equals or exceeds
$100.0 million but is less than the Stock/Holdco Bridge Amount (the “Holdco
Deficiency”), the amount of the Holdco Deficiency shall not be funded through
the issuance or sale of Holdco PIK Notes and/or borrowings under the Holdco
Bridge Facility, but shall be added to the Bond/Opco Bridge Amount and (ii) the
Holdco PIK Notes are required to be issued on or prior to the Closing Date with
any original issue discount (“OID”) or upfront fees, at the Holdco Borrower’s
election, the Stock/Holdco Bridge Amount shall be increased by an amount
sufficient to fund any such OID or upfront fees (which amounts shall be
automatically added to the Commitment Parties’ commitments under the Commitment
Letter).

A-1

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(d)

The Opco Borrower will (i) issue and sell second lien secured notes (the “Opco
Notes” and, together with the Holdco PIK Notes, the “Notes”) in a private
placement offering in the US under Rule 144A or other private placement (it
being understood that a portion of the offering of the Notes may also be placed
in Canada on a private basis only) yielding $290.0 million (the “Bond/Opco
Bridge Amount”) in gross cash proceeds and/or (ii) to the extent that Opco Notes
yielding gross proceeds of less than the Bond/Opco Bridge Amount are issued on
or before the Closing Date, obtain second lien secured increasing rate bridge
loans under the senior second lien secured credit facility described in Exhibit
B to the Commitment letter (the “Opco Bridge Facility” and, together with the
Holdco Bridge Facility, the “Bridge Facilities”), in an aggregate principal
amount that, when added to the amount of gross proceeds raised from the issuance
of the Opco Notes is equal to the Bond/Opco Bridge Amount; provided that, to the
extent that there is any Holdco Deficiency, the amount of the Holdco Deficiency
shall be added to the Bond/Opco Bridge Amount and funded through the issuance
and sale of additional Opco Notes and/or additional borrowings under the Opco
Bridge Facility and (ii) the Opco Notes are required to be issued on or prior to
the Closing Date with any OID or upfront fees, at the Opco Borrower’s election,
the Bond/Opco Bridge Amount shall be increased by an amount sufficient to fund
any such OID or upfront fees (which amounts shall be automatically added to the
Commitment Parties’ commitments under the Commitment Letter).

 

 

 

 

(e)

Immediately after giving effect to the Acquisition, the principal, accrued and
unpaid interest, fees, premium, if any, and other amounts, other than (i)
contingent obligations not then due and payable and that by their terms survive
the termination of the Target Credit Facility (as defined below) and (ii)
certain existing letters of credit outstanding under the Target Credit Facility
that on the Closing Date will be grandfathered into, or backstopped by, the
Existing Credit Facilities or cash collateralized in a manner satisfactory to
the issuing banks thereof, under that certain Credit Agreement, dated as of
March 19, 2013 (as amended, supplemented or otherwise modified from time to time
prior to the date hereof, the “Target Credit Facility”), by and among Sunrise
Growers, Inc., Farm Capital Incorporated and Pacific Ridge Farms, LLC, as
borrowers, Sunrise Holdings (Delaware), Inc., as a guarantor, certain financial
institutions, as lenders, and Bank of Montreal, as administrative agent, will be
repaid in full in connection with the other Transactions and all commitments to
extend credit under the Target Credit Facility will be terminated and any
security interests and guarantees in connection therewith shall be terminated
and/or released (the “Refinancing”).

A-2

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(f)

The proceeds of (i) borrowings of up to $50.0 million under the Existing North
American Credit Facility plus, at either Borrowers’ election, an additional
$20.0 million to fund incremental peak working capital fluctuations of the
Target and its subsidiaries plus, at either Borrowers’ election, an amount
sufficient to fund any OID or upfront fees required to be funded in connection
with the issuance of any Holdco PIK Notes or the Opco Notes (or any Takeout
Securities issued in lieu of either thereof), (ii) the Holdco Bridge Facility,
the Holdco PIK Notes and/or the Equity Securities (or any Takeout Securities
issued in lieu of the Holdco PIK Notes), (iii) the Opco Bridge Facility and/or
the Opco Notes (or any Takeout Securities issued in lieu of the Opco Notes) and
(iv) available cash on hand, if any, of the Holdco Borrower and its subsidiaries
and the Target and its subsidiaries on the Closing Date will be applied to pay
(A) the Acquisition Consideration, (B) the fees, costs and expenses incurred in
connection with the Transactions (such fees, costs and expenses, the
“Transaction Costs”) and (C) for the Refinancing (the amounts set forth in
clauses (A) through (C) above, collectively, the “Acquisition Costs”).

The transactions described above (including the payment of Transaction Costs)
are collectively referred to herein as the “Transactions”.

A-3

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EXHIBIT B

PROJECT SHINE
HOLDCO INCREASING RATE BRIDGE FACILITY
SUMMARY OF PRINCIPAL TERMS AND CONDITIONS1

Borrower:

SunOpta Inc

 

 

Transaction:

As set forth in Exhibit A to the Commitment Letter.

 

 

Bridge Administrative Agent:

BMO will act as sole and exclusive administrative agent for the Bridge Facility
(in such capacity, the “Holdco Bridge Administrative Agent”) for a syndicate of
banks, financial institutions and other institutional lenders and investors
determined in consultation with, and reasonably acceptable to, the Borrower
(together with the Initial Lenders, the “Holdco Bridge Lenders”), and will
perform the duties customarily associated with such role.

 

 

Bridge Lead Arranger and Bridge Bookrunner:

BMOCM will act as the lead arranger for the Holdco Bridge Facility and lead
bookrunner for the Holdco Bridge Facility, and will perform the duties
customarily associated with such roles.

 

 

Bridge Loans:

The Holdco Bridge Lenders will make increasing rate bridge loans (the “Holdco
Bridge Loans”) to the Holdco Borrower, available in a single borrowing on the
Closing Date, in an aggregate principal amount as described in paragraph (c) of
Exhibit A (the “Holdco Bridge Facility”).

 

 

Currency

US dollars only.

 

 

Purpose:

The proceeds of the Holdco Bridge Facility will be used by the Holdco Borrower
on the Closing Date, together with the proceeds of the borrowings under the
Existing North American Credit Facility, proceeds from the issuance of the
Equity Securities (if any) , proceeds from the issuance of the Holdco PIK Notes
(if any) (or any Takeout Securities issued in lieu of the Holdco PIK Notes), the
proceeds of the Opco Bridge Facility, the proceeds from the issuance of the Opco
Notes (if any) (or any “demand securities” issued in lieu of the Opco Notes) and
available cash on hand, if any, at the Holdco Borrower and the Opco Borrower,
the Target and their respective subsidiaries, solely to pay Acquisition Costs.

_________________________________
1 All capitalized terms used but not defined herein shall have the meanings
given to them in the Commitment Letter to which this Term Sheet is attached,
including the Exhibits thereto. In the event any such capitalized term is
subject to multiple or differing definitions, the appropriate meaning thereof in
this Exhibit B shall be determined by reference to the context in which it is
used.

B-1

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Ranking:

The Holdco Bridge Facility will constitute unsecured senior subordinated
indebtedness of the Holdco Borrower, subordinated in right of payment on such
terms only to the obligations of the Holdco Borrower under any indebtedness of
the Opco Borrower and its subsidiaries for which the Holdco Borrower is also
obligated (whether directly or by guarantee), including the Existing North
American Credit Facility and the Opco Bridge Facility and/or the Opco Notes, and
will contain payment subordination provisions customary for recently issued high
yield unsecured senior subordinated debt securities. The Holdco Bridge Facility
will otherwise rank equal in right of payment with all other existing and future
senior indebtedness of the Holdco Borrower and senior to all existing and future
subordinated indebtedness of the Holdco Borrower that expressly provides for its
subordination to the Holdco Bridge Facility. Any indebtedness of Unrestricted
Subsidiaries (as defined below) shall be non-recourse to the Holdco Borrower.

 

 

Guarantees:

None.

 

 

Security:

None.

 

 

PIK Toggle:

Interest on any Holdco Bridge Loans will be payable in full in cash by the
Holdco Borrower in the case of the first two interest payments that apply to
full quarterly interest periods after the Closing Date. Thereafter, with respect
to each interest period prior to the final maturity, acceleration or full
redemption of the Holdco Bridge Loans, at any time that there is a Distributable
Cash Amount (to be defined in the Holdco Bridge Facilities Documentation (as
defined below) as the sum of (x) unrestricted cash held by the Holdco Borrower
and (y) the amount of unrestricted cash held by the Opco Borrower or its
domestic subsidiaries that is permitted to be distributed to the Holdco Borrower
under any operative financing facilities or agreements of the Opco Borrower and
applicable law, in the case of each of the preceding clauses (x) and (y)
calculated as of the date that is 15 days prior to the beginning of the
applicable interest period, and subject to thresholds and exceptions to be
mutually agreed), the Holdco Borrower shall first apply the Distributable Cash
Amount as a cash payment in respect of the outstanding interest payments (a
“Cash Payment”) and second make the remaining interest payment (if any) by
adding such interest to the principal amount (a “PIK Payment”). Notwithstanding
anything to the contrary herein, with respect to each interest period for which
the Holdco Borrower has made a PIK Payment, interest shall be payable (as to the
portion of the interest subject to such PIK Payment only) at the applicable rate
for such interest period as set forth below plus 75 basis points (such 75 basis
point increase, the “PIK Margin Increase”).

B-2

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Interest Rates: The Holdco Bridge Loans will initially bear interest at a rate
per annum equal to the sum of the greater of (i) the London interbank offered
rate (“LIBOR”) for US dollars (for interest periods of 1, 2, 3 or 6 months, as
selected by the Holdco Borrower) and (ii) 1.00% plus, in each case, the Spread.
The “Spread” will initially equal 10.25% (before giving effect to any PIK Margin
Increase) or 11.00% (after giving effect to any PIK Margin Increase). If the
Holdco Bridge Loans are not repaid in full within three months following the
Closing Date, the Spread will increase by 75 basis points at the end of such
three month period and will increase by an additional 75 basis points at the end
of each three month period thereafter.     Notwithstanding anything to the
contrary set forth above, at no time, other than as provided under the heading
“Default Rate” below, shall the per annum yield on the Holdco Bridge Loans
exceed the amount specified in the Fee Letter in respect of the Holdco Bridge
Facility as the “Holdco Total Cap”, or, with respect to any interest period for
which the Holdco Borrower has made a PIK Payment (and as to the portion of the
interest subject to such PIK Payment only), exceed the amount specified in the
Fee Letter in respect of the Holdco Bridge Facility as the “Holdco PIK Total
Cap”.     Upon the occurrence of a Holdco Demand Failure Event (as defined in
the Fee Letter), the outstanding Holdco Bridge Loans will automatically and
immediately accrue interest at the Holdco Total Cap (or, with respect to any
interest period for which the Holdco Borrower has made a PIK Payment, the Holdco
PIK Total Cap (as to the portion of the interest subject to such PIK Payment
only)).     Following the Initial Holdco Bridge Loan Maturity Date, all
outstanding Holdco Extended Term Loans will accrue interest at a rate equal to
the Holdco Total Cap (or, with respect to any interest period for which the
Holdco Borrower has made a PIK Payment, the Holdco PIK Total Cap (as to the
portion of the interest subject to such PIK Payment only)).    

Interest Payments:

Interest on the Holdco Bridge Facility will be payable quarterly in arrears.

B-3

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Default Rate:

Upon the occurrence and during the continuance of any payment or bankruptcy
event of default, overdue principal, interest, fees and other amounts shall bear
interest at the applicable interest rate plus 2.0% per annum.

 

 

Maturity:

All Holdco Bridge Loans will have an initial maturity date that is the one year
anniversary of the Closing Date (the “Holdco Bridge Loan Maturity Date”), which
shall automatically be extended as provided below. If any of the Holdco Bridge
Loans have not been previously repaid in full on or prior to the Holdco Bridge
Loan Maturity Date, so long as no bankruptcy event of default has occurred and
is continuing as of such date, such Holdco Bridge Loans shall automatically be
extended into and become senior unsecured term loans (each, a “Holdco Extended
Term Loan”) due on the date that is seven years and six months after the Closing
Date and having the terms set forth in Annex II to this Exhibit B. The date on
which Holdco Bridge Loans become Holdco Extended Term Loans is referred to as
the “Holdco Extension Date”.

 

 

At any time on or after the Holdco Extension Date, from time to time at the
option of the Holdco Bridge Lenders, but no more than a number of times to be
mutually agreed upon in any calendar quarter, indebtedness under the Holdco
Extended Term Loans may be exchanged (in whole or in part) for exchange notes
(the “Holdco Exchange Notes”) having an equal principal amount to the
indebtedness so exchanged and having the terms set forth in Annex III to this
Exhibit B; provided that the Holdco Borrower may defer each issuance of a series
of Holdco Exchange Notes until such time as the Holdco Borrower shall have
received requests to issue an aggregate of at least $40,000,000 in aggregate
principal amount of Holdco Exchange Notes (or less, if used to exchange the
entire outstanding amount of the Holdco Extended Term Loans for Holdco Exchange
Notes).

 

 

The Holdco Extended Term Loans will be governed by the provisions of the Holdco
Bridge Facility Documentation and will have the same terms as the Holdco Bridge
Facility except as expressly set forth in Annex II to this Exhibit B. The Holdco
Extended Term Loans will not be considered to constitute new indebtedness of the
Holdco Borrower but will evidence the same indebtedness as was evidenced by the
Holdco Bridge Loans, which indebtedness will continue with full force and effect
in the form of Holdco Extended Term Loans. The Holdco Exchange Notes will be
issued pursuant to an indenture that will have the terms set forth in Annex III
to this Exhibit B.

B-4

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The Holdco Bridge Facility, the Holdco Extended Term Loans and the Holdco
Exchange Notes shall rank equal in right of payment for all purposes.

 

   

Mandatory Prepayment:

The Holdco Borrower will be required to prepay the Holdco Bridge Loans on a pro
rata basis at 100% of the outstanding principal amount thereof plus accrued and
unpaid interest with (a) the net cash proceeds from the issuance of the Equity
Securities, (b) the net cash proceeds from the Holdco PIK Notes and any other
debt issuances by the Holdco Borrower (but not by the Opco Borrower or any of
its subsidiaries); provided that, in the event any Holdco Bridge Lender or
affiliate of a Holdco Bridge Lender purchases debt securities from the Holdco
Borrower pursuant to a permitted securities demand at an issue price that is
above the level at which such Holdco Bridge Lender or affiliate has reasonably
determined such debt securities can be resold by such Holdco Bridge Lender or
affiliate to a bona fide third party at the time of such purchase (and notifies
the Holdco Borrower thereof), the net cash proceeds received by the Holdco
Borrower in respect of such debt securities may, at the option of such Holdco
Bridge Lender or affiliate, be applied first to prepay the Holdco Bridge Loans
of such Holdco Bridge Lender or affiliate (provided that if there is more than
one such Holdco Bridge Lender or affiliate then such net cash proceeds will be
applied pro rata to prepay the Holdco Bridge Loans of all such Holdco Bridge
Lenders or affiliates in proportion to such Holdco Bridge Lenders’ or
affiliates’ principal amount of debt securities purchased from the Holdco
Borrower) prior to being applied to prepay the Holdco Bridge Loans held by other
Holdco Bridge Lenders, and (c) the net cash proceeds from any non-ordinary
course asset sales or dispositions or receipt of insurance proceeds by the
Holdco Borrower or any of its restricted subsidiaries in excess of amounts
required to be paid to lenders under the Existing Credit Facilities, the Opco
Bridge Facility, the Opco Notes and/or any documentation governing any
indebtedness of any restricted subsidiary of the Holdco Borrower (other than the
Opco Borrower and its subsidiaries) (except in the case of any sale of the
capital stock and assets of Opta Minerals Inc. (“Opta Minerals”), any other
subsidiary of the Holdco Borrower (other than the Opco Borrower and its
subsidiaries) or any minority interest owned by the Holdco Borrower or its
restricted subsidiaries (other than the Opco Borrower and its subsidiaries), the
proceeds of which will be applied to the Holdco Bridge Loans before application
to the Opco Bridge Facility and the Opco Notes), in the case of any such
prepayments pursuant to the foregoing clause (c) above, with exceptions, baskets
and reinvestment provisions usual and customary for financings of this type to
be set forth in the Holdco Bridge Facility Documentation and subject to the
Documentation Principles, except that there shall be no reinvestment rights in
respect of net cash proceeds (less the pro rata portion thereof attributable to
minority interest ownership thereof) of any sale of the capital stock or assets
of Opta Minerals (with such net cash proceeds also calculated after giving
effect to required payoff of Opta Minerals’ credit facility and any other
outstanding indebtedness of Opta Minerals in the case of the sale of assets of
Opta Minerals) for so long as the Holdco Bridge Facility is outstanding.

B-5

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The Holdco Borrower will also be required to offer to prepay the Holdco Bridge
Loans following the occurrence of a change of control (to be defined in the
Holdco Bridge Facility Documentation and subject to the Documentation
Principles) at 100% of the outstanding principal amount thereof, plus accrued
and unpaid interest to the date of repayment.

 

 

These mandatory prepayment provisions will not apply to the Holdco Extended Term
Loans.

 

 

Optional Prepayment:

The Holdco Bridge Facility may be prepaid, in whole or in part, without penalty
or premium, at par plus accrued and unpaid interest upon not less than three
business days’ prior written notice, at the option of the Holdco Borrower at any
time; provided that, upon the occurrence of a Holdco Demand Failure Event,
except as otherwise limited by the provisions set forth in section of the Fee
Letter entitled “Holdco Securities Demand”, the outstanding Holdco Bridge Loans
will automatically and immediately be subject to the call protection provisions
applicable to the Holdco Exchange Notes.

 

 

Right to Resell Bridge Facility:

Each Holdco Bridge Lender shall have the absolute and unconditional right to
resell or assign the Holdco Bridge Loans held by it in compliance with
applicable law to any third party at any time, with the consent of the Holdco
Borrower (not to be unreasonably withheld, conditioned or delayed) and with
notice to the Holdco Bridge Administrative Agent; provided that the Holdco
Borrower’s consent shall not be required (i) at any time after the Holdco Bridge
Loan Maturity Date, (ii) after the occurrence and during the continuance of a
Holdco Demand Failure Event or payment or bankruptcy event of default or (iii)
to the extent that the Initial Lenders would continue to hold a majority in
aggregate principal amount of the Holdco Bridge Loans after giving effect to
such sale or assignment. The Holdco Bridge Lenders will be permitted to sell
participations in their Holdco Bridge Loans without restriction in accordance
with applicable law and consistent with the Documentation Principles.

B-6

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Conditions to Borrowing:

The availability of the borrowing under the Holdco Bridge Facility on the
Closing Date shall be subject solely to the applicable conditions set forth in
Exhibit D of the Commitment Letter.

 

 

Bridge Facility Documentation:

The definitive documentation for the Holdco Bridge Facility (the “Holdco Bridge
Facility Documentation”) shall be in form customary for financings of this
nature and consistent with the Documentation Principles.

 

 

Representations and Warranties:

The Holdco Bridge Facility Documentation will contain customary representations
and warranties for financings of this nature and consistent with the
Documentation Principles.

 

 

Covenants:

The Holdco Bridge Facility Documentation will contain such affirmative and
negative covenants applicable to the Holdco Borrower and the restricted
subsidiaries as are usual and customary for financings of this nature and
consistent with the Documentation Principles; it being understood and agreed
that the covenants of the Holdco Bridge Loans (and the Holdco Extended Term
Loans and the Holdco Exchange Notes) will be incurrence-based covenants
customary for Rule 144A “for life” holdco high yield transactions, otherwise
consistent with the Documentation Principles and reflecting the provisions of
Annex I to Exhibit B. Prior to the Holdco Bridge Loan Maturity Date, the debt
and lien incurrence and restricted payment covenants of the Holdco Bridge Loans
will be more restrictive than those of the Holdco Extended Term Loans and the
Holdco Exchange Notes, as reasonably agreed by the Lead Arranger and the
Borrower.

 

 

Unrestricted Subsidiaries:

Opta Minerals plus other “Unrestricted Subsidiaries” (to be defined in a manner
consistent with similar holdco high yield transactions and otherwise consistent
with the Documentation Principles) are herein referred to as “Unrestricted
Subsidiaries”. For the avoidance of doubt, all subsidiaries of the Holdco
Borrower that are not Unrestricted Subsidiaries are “restricted subsidiaries.”

 

 

Events of Default:

The Holdco Bridge Facility Documentation will contain customary Events of
Default for a financing of this type and consistent with the Documentation
Principles and otherwise reflecting the provisions of Annex I to Exhibit B,
limited to: (subject to materiality thresholds, baskets, grace periods and other
exceptions and qualifications to be agreed upon): nonpayment of principal,
interest or other amounts; violation of covenants; inaccuracy of representations
and warranties in any material respect; cross payment default; cross
acceleration to material indebtedness; bankruptcy or insolvency of the Holdco
Borrower or its material restricted subsidiaries; material monetary judgments.

B-7

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Voting:

Amendments and waivers of the Holdco Bridge Facility Documentation will require
the approval of Holdco Bridge Lenders holding more than 50% of the aggregate
principal amount of the Holdco Bridge Facility, except that the consent of each
Holdco Bridge Lender directly adversely affected thereby shall be required with
respect to (a) reductions of principal (it being understood that a waiver of any
condition precedent or the waiver of any default, event of default or mandatory
prepayment shall not constitute a reduction in principal), interest (other than
a waiver of default interest) or fees payable to such Holdco Bridge Lender, (b)
extensions of the final maturity of the Holdco Bridge Facility (it being
understood that a waiver of any condition precedent or the waiver of any
default, event of default or mandatory prepayment shall not constitute an
extension of the final maturity date) of such Holdco Bridge Lender or the due
date of any interest or fee payment and (c) changes in voting percentages.

 

 

Replacement of Lenders

The Holdco Bridge Facility Documentation shall contain customary provisions for
replacing (a) defaulting lenders, (b) Lenders asserting a claim for any funding
protection whether for increased costs, taxes, required indemnity payments or
otherwise and (c) non-consenting Lenders in connection with amendments and
waivers requiring the consent of all Lenders under the Holdco Bridge Facility or
of all Lenders directly affected thereby so long as the consent of Lenders
holding at least 50.1% of the aggregate amount of loans and commitments under
the Holdco Bridge Facility, or of the Lenders affected thereby, has been
obtained.

 

 

Cost and Yield Protection:

Customary for facilities of this type and consistent with the Documentation
Principles.

 

 

Expenses and Indemnification:

Customary for facilities of this type and consistent with the Documentation
Principles.

 

 

Governing Law and Forum:

New York

B-8

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

US Counsel to the Bridge Administrative Agent:

Paul Hastings LLP

 

 

Canadian Counsel to the Bridge Administrative Agent:

Goodmans LLP

B-9

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

ANNEX I TO
EXHIBIT B

Guarantees     Opco Facilities     • The Opco Facilities (including the Opco
Bridge Loans, Opco Extended Term Loans, Opco Exchange Notes and any Takeout
Securities issued in lieu of the Opco Notes, collectively, the “Opco
Facilities”) shall benefit from upstream guarantees from domestic restricted
subsidiaries of the Opco Borrower (to the extent they guarantee the Existing
North American Credit Facility) and a downstream guarantee from the Holdco
Borrower.     Holdco Facilities     • There will be no upstream guarantees of
the Holdco Facilities (as defined below) from any subsidiaries. General Covenant
Structure     Opco Facilities     • The covenants under the Opco Facilities
shall regulate the Holdco Borrower and its restricted subsidiaries (with the
Opco Borrower being such a restricted subsidiary).     Holdco Facilities     •
The covenants under the Holdco Facilities (including the Holdco Bridge Loans,
Holdco Extended Term Loans, Holdco Exchange Notes and any Takeout Securities
issued in lieu of the Holdco PIK Notes, collectively, the “Holdco Facilities”
and, together with the Opco Facilities, the “Facilities”) shall regulate the
Holdco Borrower and its restricted subsidiaries (with the Opco Borrower being
such a restricted subsidiary).     Financial Reporting     • Financial reporting
under each Facility shall be at the Holdco Borrower and its subsidiaries on a
consolidated basis.     Restricted Payments Covenant     • Tested at the Holdco
Borrower under both the Opco Facilities and Holdco Facilities.     Opco
Facilities     •

Customary covenant, but regulating restricted payments by the Holdco Borrower
and its restricted subsidiaries and consisting of a customary 50% Consolidated
Net Income “build-up” test and related Fixed Charge Coverage Ratio condition, in
each case using the Holdco Borrower’s financials, with customary exceptions to
be negotiated consistent with the Documentation Principles, plus the additional
exceptions described below.

Annex I-B-1

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

o

For so long as any Holdco Facilities are outstanding, the Opco Facilities will
treat any cash payment of principal or interest on the Holdco Facilities as a
“Restricted Payment” by the Holdco Borrower, with exceptions from this
particular limitation to include (i) a basket that will be in an amount
sufficient to (a) fund any interest payments on the Holdco Facilities that are
required by the terms thereof to be paid in cash and (b) fund certain voluntary
cash interest payments on the Holdco Facilities, (ii) repayments or redemptions
of principal and accrued interest under Holdco Facilities made by exchange for,
or with the proceeds of a substantially concurrent sale of, common equity by the
Holdco Borrower and (iii) the exception described in the bullet below.

     

o

In addition, the Opco Facilities will permit the repayment or redemption of
principal and accrued interest under Holdco Facilities made by exchange for, or
with the proceeds of a substantially concurrent sale of, indebtedness (or
preferred stock) of the Holdco Borrower; provided that such indebtedness (or
preferred stock) (1) is incurred in an aggregate principal amount (or issued
having an aggregate liquidation preference) equal to or less than the Holdco
Facilities being refinanced (taking into account any accrual of PIK interest to
the date of refinancing, and plus any additional indebtedness incurred to pay
premiums and expenses), (2) is, in the case of indebtedness, pari passu with or
subordinated to the guarantee of Holdco under the Opco Facilities and is
unsecured, (3) has a stated maturity (or, in the case of the preferred stock,
mandatory redemption, if any, or mandatory payment of liquidation preference, if
any) no earlier than the Holdco Facilities being refinanced and at least 91 days
later than the stated maturity of the Opco Facilities and a weighted average
life to maturity equal to or greater than the Holdco Facilities being
refinanced, (4) includes limitations on cash interest (or dividend) payments no
more favorable to the debtholders (or preferred stockholders) than those of the
Holdco Facilities being refinanced and (5) bears interest (or accrues dividends)
at a rate no greater than the interest rate applicable to the Holdco Facilities
being refinanced.

     

•

For so long as any Holdco Facilities are outstanding, the Opco Facilities shall
contain an additional covenant regulating certain restricted payments by the
Opco Borrower, consisting of a customary 50% of Consolidated Net Income
“build-up” test and related Fixed Charge Coverage Ratio condition, in each case
using the Holdco Borrower’s financials, with customary exceptions to be
negotiated consistent with the Documentation Principles, including (i) a basket
that will be in an amount sufficient to (a) fund any interest payments on the
Holdco Facilities that are required by the terms thereof to be paid in cash and
(b) fund certain voluntary cash interest payments on the Holdco Facilities, (ii)
an exception for excess asset sale proceeds that the Holdco Borrower may be
required to apply to the Existing Credit Facilities or the Holdco Facilities (it
being understood that proceeds of sales of assets of the European business shall
first be required to be offered to repay indebtedness under the Existing
European Credit Facility, the Existing North American Credit Facility, and the
Opco Facilities, in accordance with their terms, prior to being available to be
offered to repay Holdco Facilities), (iii) an exception for customary expenses
at the Holdco Borrower, (iv) repayments or redemptions of principal and accrued
interest under Opco Facilities made by exchange for, or with the proceeds of a
substantially concurrent sale of, common equity by the Opco Borrower and (v)
repayment or redemption of principal and accrued interest under Opco Facilities
made by exchange for, or with the proceeds of a substantially concurrent sale
of, indebtedness (or preferred stock) of the Opco Borrower; provided that such
indebtedness (or preferred stock) (1) is incurred in an aggregate principal
amount (or issued having an aggregate liquidation preference) equal to or less
than the Opco Facilities being refinanced, and plus any additional indebtedness
incurred to pay premiums and expenses), (2) is, in the case of indebtedness,
pari passu with or subordinated to the Existing North American Credit Facility
and (3) has a stated maturity (or, in the case of the preferred stock, mandatory
redemption, if any, or mandatory payment of liquidation preference, if any) no
earlier than the Opco Facilities being refinanced and a weighted average life to
maturity equal to or greater than the Opco Facilities being refinanced .

Annex I-B-2

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

  o This additional covenant shall regulate only dividends by the Opco Borrower
to the Holdco Borrower and repurchases by the Opco Borrower of the Holdco
Borrower’s stock and shall not regulate investments by the Opco Borrower or
repurchases of the Opco Borrower’s debt by the Opco Borrower.        • For the
avoidance of doubt, the Opco Facilities shall not restrict the payment by Holdco
of obligations owing by it under the ABL and shall not restrict the upstreaming
of funds from the Opco Borrower to the Holdco Borrower to be used for such
purpose.        • The Opco Facilities shall permit any AHYDO “catch-up” payments
to be made, but only if required under applicable tax laws.       Holdco
Facilities       •   Customary restricted payment covenant, consisting of a
customary 50% Consolidated Net Income “build-up” test and related Fixed Charge
Coverage Ratio condition, in each case using the Holdco Borrower’s financials,
with customary exceptions to be negotiated consistent with the Documentation
Principles, plus exceptions that match any additional exceptions described
above, as applicable.       •   The Holdco Facilities shall permit any AHYDO
“catch-up” payments to be made, but only if required under applicable tax laws.
      Debt and Preferred Stock Incurrence Covenant       •   Tested at the
Holdco Borrower under both the Opco Facilities and Holdco Facilities (all ratios
are to be calculated using the Holdco Borrower’s financials).       Opco
Facilities       •   The Fixed Charge Coverage Ratio permission will be capped
for non-guarantors at an amount to be agreed.       •   The credit facilities
basket shall permit growth based on accounts receivable and inventory, not fixed
asset collateral borrowing base.

Annex I-B-3

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

•

There shall be no restriction on the Opco Borrower or the Holdco Borrower
borrowing under the ABL, but any application of such borrowings to the Holdco
Borrower’s debt (other than payments of the ABL) would be subject to the
Restricted Payments covenant described above.

    •

Other baskets (including a general basket) to be agreed, and certain of these
baskets (including the general basket) to be agreed may also be capped for
non-guarantors.

Holdco Facilities

    •

The credit facilities basket shall permit growth based on accounts receivable
and inventory, not fixed asset collateral borrowing base.

    •

There shall be no restriction on the Holdco Borrower borrowing under the ABL,
but any application of such borrowings to the Holdco Borrower’s debt (other than
payments of the ABL) would be subject to the Restricted Payments covenant
described above.

    •

Other baskets (including a general basket) to be agreed.

 

Asset Sale Covenant

    •

Tested at the Holdco Borrower under both the Opco Facilities and Holdco
Facilities.

    •

Repayment of ABL debt and other debt of the Opco Borrower using proceeds from
all asset sales shall satisfy the asset sale covenant in both the Holdco
Facilities and the Opco Facilities. Repayment of debt of Opta Minerals using
proceeds of sale of assets of Opta Minerals shall satisfy the asset sale
covenant in both the Holdco Facilities and Opco Facilities.

   

Opco Facilities only

•

If any Excess Proceeds remain and are required to be applied to payment of the
Holdco Facilities, the additional restricted payment covenant in the Opco
Facilities shall permit the Opco Borrower to make restricted payments to the
Holdco Borrower with “Excess Proceeds” from asset sales (it being understood
that proceeds of sales of assets of the European business shall first be
required to be offered to repay indebtedness under the Existing European Credit
Facility, the Existing North American Credit Facility and the Opco Facilities,
in accordance with their terms, prior to being available to be offered to repay
Holdco Facilities).

    •

If any Excess Proceeds from any sale of Opta Minerals remain after repayment of
Opta Minerals’ debt, such proceeds shall be applied first to reduce the Holdco
Facilities (if permitted by the Existing Credit Facilities), and thereafter to
reduce the Opco Facilities.

   

Affiliate Transactions Covenant

   

         •

The Opco Facilities and the Holdco Facilities shall permit all dealings and
transactions between and among (1) the Opco Borrower and its restricted
subsidiaries and (2) the Holdco Borrower and its restricted subsidiaries, as
well as other exceptions for dealings between and among such persons and other
affiliates.

Annex I-B-4

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

Lien Covenant     • The lien covenant in both Facilities shall regulate the
Holdco Borrower and the Lien covenant of the Opco Facilities shall regulate the
guarantors of such Facilities, and all ratio calculations shall be calculated
using the Holdco Borrower’s financials.     Dividend Stoppers Covenant     • The
additional restricted payment covenant described above in the Opco Facilities
shall be expressly permitted by the Holdco Facilities.     Merger Covenant     •
Each Facility shall contain a single covenant at the Holdco Borrower pertaining
to a merger of the Holdco Borrower or a sale of substantially all its assets    
Change of Control     • Each Facility shall contain a single covenant at the
Holdco Borrower pertaining to a change of control of the Holdco Borrower and the
Holdco Borrower ceasing to own 100% of the capital stock of the Opco Borrower.  
  Defaults     • Each Facility shall contain defaults pertaining to the Holdco
Borrower and its restricted subsidiaries (including the Opco Borrower).    
Definitions     • The Holdco Consolidated Net Income definition shall not
exclude the Opco Borrower’s net income due to the additional restricted payments
covenant at the Opco Borrower described above.     Other Changes     • Such
other changes reasonably requested by the Borrowers and agreed by the Lead
Arranger (acting reasonably) to reflect the need for ongoing operational
flexibility, consistent with the foregoing and the Documentation Principles.

Annex I-B-5

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

ANNEX II TO
EXHIBIT B

HOLDCO EXTENDED TERM LOANS

Maturity:

The Holdco Extended Term Loans will mature on the date that is seven years and
six months after the Closing Date.

 

Interest Rate:

The Holdco Extended Term Loans will bear interest at a rate per annum equal to
the Holdco Total Cap (or, with respect to any interest period for which the
Holdco Borrower has made a PIK Payment, the Holdco PIK Total Cap (as to the
portion of the interest subject to such PIK Payment only)).

 

Interest shall be payable quarterly and on the maturity date of the Holdco
Extended Term Loans, in each case payable in arrears and computed on the basis
of a 365-day year.

 

Default Rate:

Upon the occurrence and during the continuance of any payment or bankruptcy
event of default, overdue principal, interest, fees and other amounts shall bear
interest at the applicable interest rate plus 2.0% per annum.

 

Guarantees:

None.

 

Security:

None.

 

Covenants, Defaults and Mandatory Offers to Purchase:

Upon and after the Holdco Bridge Loan Maturity Date, the covenants, mandatory
prepayments (other than with respect to a change of control, with respect to
which the provisions of the Holdco Bridge Loans will apply) and defaults which
would be applicable to the Holdco Exchange Notes, if issued, will also be
applicable to the Holdco Extended Term Loans in lieu of the corresponding
provisions of the Holdco
Bridge Loan Documentation.

 

Optional Prepayment:

The Holdco Extended Term Loans may be prepaid, in whole or in part, at par, plus
accrued and unpaid interest upon not less than three days’ prior written notice,
at the option of the Holdco Borrower at any time; provided that upon the
occurrence of a Holdco Demand Failure Event, the outstanding Holdco Extended
Term Loans will automatically and immediately be subject to the call protection
provisions applicable to the Holdco Exchange Notes.

 

Governing Law and Forum:

New York.

Annex II-B-1

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

ANNEX III TO
EXHIBIT B

HOLDCO EXCHANGE NOTES

Issuer: The Borrower will issue the Holdco Exchange Notes under an indenture.
The Holdco Borrower or an affiliate, in its capacity as the issuer of the Holdco
Exchange Notes, is referred to as the “Holdco Issuer”.     Principal Amount: The
Holdco Exchange Notes will be issued on or after the Holdco Extension Date. The
principal amount of any Holdco Exchange Note will equal 100% of the aggregate
principal amount of the Holdco Extended Term Loan for which it is exchanged. In
the case of a partial exchange, the minimum amount of Holdco Extended Term Loans
to be exchanged for Holdco Exchange Notes will be $40,000,000 (or less if used
to exchange the entire outstanding amount of the Holdco Extended Term Loans).  
  Maturity: The Holdco Exchange Notes will mature on the date that is seven
years and six months after the Closing Date.     Interest Rate: The Holdco
Exchange Notes will bear interest payable semi-annually at a weighted average
yield which shall not exceed the Holdco Total Cap (or, with respect to any
interest period for which the Holdco Borrower has made a PIK Payment, the Holdco
PIK Total Cap (as to the portion of the interest subject to such PIK Payment
only)).     Guarantees: None.     Security: None.     Offer of Purchase upon
Change of Control: The Holdco Issuer will be required to make an offer to
repurchase the Holdco Exchange Notes following the occurrence of a change of
control (to be defined in a manner consistent with high- yield debt offerings
giving effect to the Documentation Principles) at a price in cash equal to 101%
(or 100% in the case of Holdco Exchange Notes held by the Commitment Parties or
their respective affiliates excluding Holdco Exchange Notes held by them in
connection with market making activities or asset management affiliates
purchasing the Holdco Exchange Notes in the ordinary course of their business as
part of a regular distribution of the Holdco Exchange Notes (“Asset Management
Affiliates”)) of the outstanding principal amount thereof, plus accrued and
unpaid interest to the date of repurchase, unless the Holdco Issuer shall redeem
such Holdco Exchange Notes pursuant to the “Optional Redemption” section below.

Annex III-B-1

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

Offer to Purchase from Asset Sale Proceeds:

The Holdco Issuer will be required to make an offer to repurchase the Holdco
Exchange Notes (and, if outstanding, prepay the Holdco Extended Term Loans) on a
pro rata basis, which offer shall be at 100% of the principal amount thereof
plus accrued and unpaid interest to the date of repurchase with a portion of the
net cash proceeds from any non-ordinary course asset sales or dispositions or
receipt of insurance proceeds by the Holdco Borrower or its restricted
subsidiaries in excess of amounts required to be paid to lenders under the
Existing Credit Facilities, the Opco Bridge Facility, the Opco Notes and/or any
documentation governing any indebtedness of any restricted subsidiary of the
Holdco Borrower (other than the Opco Borrower and its subsidiaries) (except in
the case of a sale of assets or capital stock of Opta Minerals, any other
subsidiary of the Holdco Borrower (other than the Opco Borrower and its
subsidiaries) or any minority interest owned by the Holdco Borrower or its
restricted subsidiaries (other than the Opco Borrower and its subsidiaries), the
proceeds of which will be offered to be applied to the repurchase of Holdco
Exchange Notes before application to the Opco Bridge Facility and the Opco
Notes), with such proceeds being applied to the Holdco Extended Term Loans and
the Holdco Exchange Notes in a manner to be agreed, subject to exceptions,
baskets and reinvestment provisions usual and customary for financings of this
type, except that there shall be no reinvestment rights in respect of net cash
proceeds (less the pro rata portion thereof attributable to minority interest
ownership thereof) of any sale of the capital stock or assets of Opta Minerals
(with such net cash proceeds also calculated after giving effect to required
payoff of Opta Minerals’ credit facility and any other outstanding indebtedness
of Opta Minerals in the case of sales of assets of Opta Minerals) for so long as
the Holdco Bridge Facility is outstanding.

   

Optional Redemption:

Except as set forth in the next two succeeding paragraphs, the Holdco Exchange
Notes shall be no-call in the first year following the Holdco Bridge Loan
Maturity Date, and thereafter shall be redeemable during the second and third
years following such date at a redemption prices equal to par plus 2.00% and
1.00%, respectively.

   

Prior to the one year anniversary of the Holdco Bridge Loan Maturity Date, the
Holdco Issuer may redeem Holdco Exchange Notes at a redemption price equal to
par plus a customary make-whole premium (calculated as of any redemption date
using the weekly average yield on traded U.S. treasury securities adjusted to a
constant maturity of one year plus 50 basis points).

Annex III-B-2

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

Prior to the one year anniversary of the Holdco Bridge Loan Maturity Date, the
Holdco Borrower may redeem up to 100% of the aggregate principal amount of the
Holdco Exchange Notes with proceeds from qualified equity offerings of the
Holdco Borrower at a redemption price equal to par plus 2.00%.    
Notwithstanding any of the foregoing, any Holdco Exchange Notes held by (and for
so long as they are held by) the Commitment Parties or their respective
affiliates (other than Asset Management Affiliates or Holdco Exchange Notes
purchased in the secondary market) shall be redeemable at any time and from time
to time at the option of the Holdco Borrower at a redemption price equal to par
plus accrued and unpaid interest to the redemption date.     Defeasance
Provisions: Customary for high yield transactions and consistent with the
Documentation Principles.     Amendment/Waiver: Customary for high yield
transactions and consistent with the Documentation Principles.     Covenants:
Customary for high yield transactions and consistent with the Documentation
Principles and otherwise reflecting the provisions of Annex I to Exhibit B.    
Registration Rights: None.     Right to Transfer Holdco Exchange Notes: The
holders of the Holdco Exchange Notes (including the Holdco Bridge Lenders) shall
have the right to transfer such Holdco Exchange Notes to any third parties,
subject to compliance with applicable securities and other law.     Events of
Default: Customary for high yield transactions and consistent with the
Documentation Principles and otherwise reflecting the provisions of Annex I to
Exhibit B.     Governing Law and Forum: New York.

Annex III-B-3

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

EXHIBIT C

PROJECT SHINE
OPCO SECOND LIEN INCREASING RATE BRIDGE FACILITY
SUMMARY OF PRINCIPAL TERMS AND CONDITIONS2

Borrower: SunOpta Foods Inc

 

 

Transaction:

As set forth in Exhibit A to the Commitment Letter.

 

 

Bridge Administrative Agent and Collateral Agent:

BMO will act as sole and exclusive administrative agent and collateral agent for
the Opco Bridge Facility (in such capacity, the “Opco Bridge Administrative
Agent”) for a syndicate of banks, financial institutions and other institutional
lenders and investors determined in consultation with and reasonably acceptable
to the Opco Borrower (together with the Initial Lenders, the “Opco Bridge
Lenders”), and will perform the duties customarily associated with such role.

 

 

Bridge Lead Arranger and Bridge Bookrunner:

BMOCM will act as the lead arranger for the Opco Bridge Facility and lead
bookrunner for the Opco Bridge Facility, and will perform the duties customarily
associated with such roles.

 

 

Bridge Loans:

The Opco Bridge Lenders will make increasing rate second lien secured bridge
loans (the “Opco Bridge Loans”) to the Opco Borrower, available in a single
borrowing on the Closing Date in an aggregate principal amount of in an
aggregate principal amount as described in paragraph (d) of Exhibit A (the “Opco
Bridge Facility”).

 

 

Currency

US dollars only.

 

 

Purpose:

The proceeds of the Opco Bridge Facility will be used by the Opco Borrower on
the Closing Date, together with the proceeds of the borrowings under the
Existing North American Credit Facility, proceeds from the issuance of the Opco
Notes (if any) (or any Takeout Securities issued in lieu of the Opco Notes),
proceeds of the Holdco Bridge Facility, proceeds from the issuance of Equity
Securities (if any), proceeds from the issuance of the Holdco PIK Notes (or any
Takeout Securities issued in lieu of the Holdco PIK Notes) and available cash on
hand, if any, at the Opco Borrower and the Holdco Borrower and the Target and
their respective subsidiaries, solely to pay Acquisition Costs.

__________________________
2 All capitalized terms used but not defined herein shall have the meanings
given to them in the Commitment Letter to which this Term Sheet is attached,
including the Exhibits thereto. In the event any such capitalized term is
subject to multiple or differing definitions, the appropriate meaning thereof in
this Exhibit C shall be determined by reference to the context in which it is
used.

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

Ranking:

The Opco Bridge Facility will rank equal in right of payment with all existing
and future senior indebtedness (including the Existing North American Credit
Facility) of the Opco Borrower and Guarantors and senior to all existing and
future subordinated indebtedness of the Opco Borrower and Guarantors that
expressly provides for its subordination to the Opco Bridge Facility (including,
in the case of the Holdco Borrower, the Holdco Bridge Facility). The Opco Bridge
Facility shall have a claim on Collateral that is junior only to the claim on
such Collateral of the Existing North American Credit Facility. Any indebtedness
of Unrestricted Subsidiaries (as defined below) shall be non-recourse to the
Opco Borrower and Guarantors.

 

 

Guarantees:

All of the obligations of the Opco Borrower under the Opco Bridge Facility will
be unconditionally guaranteed jointly and severally on an equal priority senior
second lien secured basis by the Holdco Borrower and those subsidiaries of the
Opco Borrower that are guarantors under the Existing North American Credit
Facility (the “Subsidiary Guarantors” and, together with the Holdco Borrower,
the “Guarantors”). For clarity, the Target and its subsidiaries shall, after
giving effect to the Acquisition, immediately become Guarantors to extent
required by the term of the Existing North American Credit Facility.

 

 

Security:

(1) All obligations of the Opco Borrower under the Opco Bridge Facility and (2)
any Guarantees thereof will be secured by a perfected second priority security
interest in the same assets of the Opco Borrower, the Holdco Borrower and the
Subsidiary Guarantors that secure the obligations under the Existing North
American Credit Facility (the “Collateral”).

 

 

The liens on the Collateral securing the Existing North American Credit Facility
will be senior in priority to the liens on such Collateral securing the Opco
Bridge Facility and any permitted refinancings thereof. The priority of the
security interests and related creditor rights between the Existing North
American Credit Facility, the Holdco Bridge Facility and the Opco Bridge
Facility will be set forth in a customary intercreditor agreement (the
“Intercreditor Agreement”) on terms and conditions to be mutually agreed.

   

Interest Rates:

The Opco Bridge Loans will initially bear interest at a rate per annum equal to
the sum of the greater of the (i) London interbank offered rate (“LIBOR”) for US
dollars (for interest periods of 1, 2, 3 or 6 months as selected by theOpco
Borrower) and (ii) 1.00% plus the Spread. The “Spread” will initially equal
6.00%. If the Opco BridgeLoans are not repaid in full within three months
followingthe Closing Date, the Spread will increase by 50 basis pointsat the end
of such three month period and will increase by an additional 50 basis points at
the end of each three month period thereafter

C-2

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

Notwithstanding anything to the contrary set forth above, at no time, other than
as provided under the heading “Default Rate” below, shall the per annum yield on
Opco Bridge Loans be greater than the Opco Total Cap (as defined in the Fee
Letter).

 

 

Upon the occurrence of an Opco Demand Failure Event (as defined in the Fee
Letter), the outstanding Opco Bridge Loans will automatically and immediately
accrue interest at the Opco Total Cap.

 

 

Following the Opco Bridge Loan Maturity Date, all outstanding Opco Extended Term
Loans will accrue interest at the Opco Total Cap.

 

 

Interest Payments:

Interest on the Opco Bridge Loans will be payable in arrears at the end of each
interest period and, for interest periods of greater than 3 months, every three
months, and on the Initial Opco Bridge Loan Maturity Date. Calculation of
interest shall be on the basis of actual days elapsed in a year of 360 days.

 

 

Default Rate:

Upon the occurrence and during the continuance of any payment or bankruptcy
event of default, overdue principal, interest, fees and other amounts shall bear
interest at the applicable interest rate plus 2.0% per annum.

 

 

Maturity:

All Opco Bridge Loans will have an initial maturity date that is the one year
anniversary of the Closing Date (the “Opco Bridge Loan Maturity Date”), which
shall automatically be extended as provided below. If any of the Opco Bridge
Loans have not been previously repaid in full on or prior to the Opco Bridge
Loan Maturity Date, so long as no bankruptcy event of default has occurred and
is continuing as of such date, such Opco Bridge Loans shall automatically be
extended into and become senior secured second lien term loans (each, an “Opco
Extended Term Loan”) due on the date that is seven years after the Closing Date
and having the terms set forth in Annex II to this Exhibit C. The date on which
Opco Bridge Loans become Opco Extended Term Loans is referred to as the “Opco
Extension Date”.

C-3

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

At any time on or after the Opco Extension Date, from time to time at the option
of the Opco Bridge Lenders, but no more than a number of times to be mutually
agreed upon in any calendar quarter, indebtedness under the Opco Extended Term
Loans may be exchanged (in whole or in part) for exchange notes (the “Opco
Exchange Notes”) having an equal principal amount to the indebtedness so
exchanged and having the terms set forth in Annex III to this Exhibit C;
provided that the Opco Borrower may defer each issuance of a series of Opco
Exchange Notes until such time as the Opco Borrower shall have received requests
to issue an aggregate of at least $50,000,000 in aggregate principal amount of
Opco Exchange Notes (or less if used to exchange the entire outstanding amount
of the Opco Extended Term Loans).

   

The Opco Extended Term Loans will be governed by the provisions of the Opco
Bridge Facility Documentation and will have the same terms as the Opco Bridge
Facility except as expressly set forth in Annex II to this Exhibit C. The Opco
Extended Term Loans will not be considered to constitute new indebtedness of the
Opco Borrower but will evidence the same indebtedness as was evidenced by the
Opco Bridge Loans, which indebtedness will continue with full force and effect
in the form of Opco Extended Term Loans. The Opco Exchange Notes will be issued
pursuant to an indenture that will have the terms set forth in Annex III to this
Exhibit C.

   

The Opco Bridge Facility, the Opco Extended Term Loans and the Opco Exchange
Notes shall rank equal in right of payment for all purposes.

   

Mandatory Prepayment:

The Opco Borrower will be required to prepay the Opco Bridge Loans on a pro rata
basis at 100% of the outstanding principal amount thereof plus accrued and
unpaid interest with (a) the net cash proceeds from the issuance of the Opco
Notes; provided that, in the event any Opco Bridge Lender or affiliate of a Opco
Bridge Lender purchases debt securities from the Opco Borrower pursuant to a
permitted securities demand at an issue price that is above the level at which
such Opco Bridge Lender or affiliate has reasonably determined such debt
securities can be resold by such Opco Bridge Lender or affiliate to a bona fide
third party at the time of such purchase (and notifies the Opco Borrower
thereof), the net cash proceeds received by the Opco Borrower in respect of such
debt securities may, at the option of such Opco Bridge Lender or affiliate, be
applied first to prepay the Opco Bridge Loans of such Opco Bridge Lender or
affiliate (provided that if there is more than one such Opco Bridge Lender or
affiliate then such net cash proceeds will be applied pro rata to prepay the
Opco Bridge Loans of all such Opco Bridge Lenders or affiliates in proportion to
such Opco Bridge Lenders’ or affiliates’ principal amount of debt securities
purchased from the Opco Borrower) prior to being applied to prepay the Opco
Bridge Loans held by other Opco Bridge Lenders, (b) the net cash proceeds of
certain debt issuances (to be defined in a mutually acceptable manner) by the
Opco Borrower or any of its restricted subsidiaries, (c) the net cash proceeds
of from certain equity offerings (subject to exceptions to be agreed, including,
without limitation, equity issued to employee stock plans or similar plans) by
the Holdco Borrower or any of its restricted subsidiaries occurring after the
date that the Holdco PIK Notes (if any) and the Holdco Bridge Loans (if any) are
repaid in full and (d) the net cash proceeds from any non-ordinary course asset
sales or dispositions or receipt of insurance proceeds by the Opco Borrower or
any of its restricted subsidiaries in excess of amounts either reinvested or
required to be paid to the lenders under the Existing Credit Facilities (and, in
the case of sales of assets or capital stock of Opta Minerals, any other
subsidiary of the Holdco Borrower (other than the Opco Borrower and its
subsidiaries) or any minority interest owned by the Holdco Borrower or its
restricted subsidiaries (other than the Opco Borrower and its subsidiaries), the
Holdco Facilities) or the holders of certain other indebtedness, in the case of
any such prepayments pursuant to the foregoing clauses (b), (c) and (d) above
with exceptions, baskets and reinvestment provisions usual and customary for
financings of this type to be set forth in the Opco Bridge Facility
Documentation and subject to the Documentation Principles, except that in the
case of clause (d), there shall be no reinvestment rights in respect of net cash
proceeds (less the pro rata portion thereof attributable to minority interest
ownership thereof) of any sale of the capital stock or assets of Opta Minerals
(with such net cash proceeds also calculated after giving effect to required
payoff of Opta Minerals’ credit facility and any other outstanding indebtedness
of Opta Minerals in the case of sales of assets of Opta Minerals) for so long as
the Holdco Bridge Facility is outstanding.

 C-4 

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

  The Opco Borrower will also be required to offer to prepay the Opco Bridge
Loans following the occurrence of a change of control (to be defined in the Opco
Bridge Facility Documentation and subject to the Documentation Principles) at
100% of the outstanding principal amount thereof, plus accrued and unpaid
interest to the date of repayment.

C-5

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

Optional Prepayment:

The Opco Bridge Facility may be prepaid, in whole or in part, without penalty or
premium, at par plus accrued and unpaid interest upon not less than three
business days’ prior written notice, at the option of the Opco Borrower at any
time; provided that, upon the occurrence of an Opco Demand Failure Event, except
as otherwise limited by the provisions set forth in the section of the Fee
Letter entitled “Securities Demand”, the outstanding Opco Bridge Loans will
automatically and immediately be subject to the call protection provisions
applicable to the Opco Exchange Notes.

   

Right to Resell Bridge Facility:

Each Opco Bridge Lender shall have the absolute and unconditional right to
resell or assign the Opco Bridge Loans held by it in compliance with applicable
law to any third party at any time, with the consent of the Opco Borrower (not
to be unreasonably withheld, conditioned or delayed) and with notice to the Opco
Bridge Administrative Agent; provided that the Opco Borrower’s consent shall not
be required (i) at any time after the Opco Bridge Loan Maturity Date, (ii) after
the occurrence and during the continuance of an Opco Demand Failure Event or
payment or bankruptcy event of default or (iii) to the extent that the Initial
Lenders would continue to hold a majority in aggregate principal amount of the
Opco Bridge Loans after giving effect to such sale or assignment.

 

The Opco Bridge Lenders will be permitted to sell participations in their Opco
Bridge Loans without restriction in accordance with applicable law and
consistent with the Documentation Principles.

   

Conditions to Borrowing:

The availability of the borrowing under the Opco Bridge Facility on the Closing
Date shall be subject solely to the applicable conditions set forth in Exhibit D
to the Commitment Letter.

 

 

Bridge Facility Documentation:

The definitive documentation for the Opco Bridge Facility (the “Opco Bridge
Facility Documentation”) shall be in form customary for financings of this
nature and consistent with the Documentation Principles.

 

 

Representations and Warranties:

The Opco Bridge Facility Documentation will contain customary representations
and warranties for financings of this nature applying to the Opco Borrower and
its restricted subsidiaries.

 

 

Covenants:

The Opco Bridge Facility Documentation will contain such affirmative and
negative covenants applicable to the Holdco Borrower, the Opco Borrower and its
restricted subsidiaries as are usual and customary for financings of this
nature, consistent with the Documentation Principles, it being understood and
agreed that the covenants of the Opco Bridge Loans (and the Opco Extended Term
Loans and the Opco Exchange Notes) will be incurrence-based covenants, customary
for other Rule 144A “for life” high yield transactions, otherwise consistent
with the Documentation Principles and reflecting the provisions of Annex I to
Exhibit C. Prior to the Opco Bridge Loan Maturity Date, the debt and lien
incurrence and the restricted payment covenants of the Opco Bridge Loans will be
more restrictive than those of the Opco Extended Term Loans and the Opco
Exchange Notes, as reasonably agreed by the Lead Arranger and the Opco Borrower.

C-6

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

Unrestricted Subsidiaries:

Opta Minerals plus other “Unrestricted Subsidiaries” (to be defined in a manner
consistent with similar high yield debt offerings and otherwise consistent with
the Documentation Principles) are herein referred to as “Unrestricted
Subsidiaries”. For the avoidance of doubt, all subsidiaries of the Holdco
Borrower that are not Unrestricted Subsidiaries are “restricted subsidiaries.”

 

 

Events of Default:

The Opco Bridge Facility Documentation will contain customary Events of Default
for a financing of this type and consistent with the Documentation Principles
and otherwise reflecting the provisions of Annex I to Exhibit C, limited to:
(subject to materiality thresholds, baskets, grace periods and other exceptions
and qualifications to be agreed upon): nonpayment of principal, interest or
other amounts; violation of covenants; inaccuracy of representations and
warranties in any material respect; cross payment default; cross acceleration to
material indebtedness; bankruptcy or insolvency of the Opco Borrower or its
material restricted subsidiaries; material monetary judgments; ERISA and
Canadian pension events and actual or asserted invalidity of a Guarantor’s
guaranty.

 

 

Voting:

Amendments and waivers of the Opco Bridge Facility Documentation will require
the approval of Opco Bridge Lenders holding more than 50% of the aggregate
principal amount of the Opco Bridge Facility, except that the consent of each
Opco Bridge Lender directly adversely affected thereby shall be required with
respect to (a) reductions of principal (it being understood that a waiver of any
condition precedent or the waiver of any default, event of default or mandatory
prepayment shall not constitute a reduction in principal), interest (other than
a waiver of default interest) or fees payable to such Opco Bridge Lender, (b)
extensions of the final maturity of the Opco Bridge Facility (it being
understood that a waiver of any condition precedent or the waiver of any
default, event of default or mandatory prepayment shall not constitute an
extension of the final maturity date) of such Opco Bridge Lender or the due date
of any interest or fee payment, (c) releases of all or substantially all
Guarantors or Collateral and (d) changes in voting thresholds.

C-7

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

Replacement of Lenders

The Opco Bridge Facility Documentation shall contain customary provisions for
replacing (a) defaulting lenders, (b) Lenders asserting a claim for any funding
protection whether for increased costs, taxes, required indemnity payments or
otherwise and (c) non-consenting Lenders in connection with amendments and
waivers requiring the consent of all Lenders under the Opco Bridge Facility or
of all Lenders directly affected thereby so long as the consent of Lenders
holding at least 50.1% of the aggregate amount of loans and commitments under
the Opco Bridge Facility, or of the Lenders affected thereby, has been obtained.

 

 

Cost and Yield Protection:

Customary for facilities of this type and consistent with the Documentation
Principles.

 

 

Expenses and Indemnification:

Customary for facilities of this type and consistent with the Documentation
Principles.

 

 

Governing Law and Forum:

New York

 

 

US Counsel to the Bridge Administrative Agent:

Paul Hastings LLP

 

 

Canadian Counsel to the Bridge Administrative Agent:

Goodmans LLP

C-8

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

ANNEX I TO
EXHIBIT C

Guarantees     Opco Facilities     • The Opco Facilities (including the Opco
Bridge Loans, Opco Extended Term Loans, Opco Exchange Notes and any Takeout
Securities issued in lieu of the Opco Notes, collectively, the “Opco
Facilities”) shall benefit from upstream guarantees from domestic restricted
subsidiaries of the Opco Borrower (to the extent they guarantee the Existing
North American Credit Facility) and a downstream guarantee from the Holdco
Borrower.     Holdco Facilities     • There will be no upstream guarantees of
the Holdco Facilities (as defined below) from any subsidiaries. General Covenant
Structure     Opco Facilities     • The covenants under the Opco Facilities
shall regulate the Holdco Borrower and its restricted subsidiaries (with the
Opco Borrower being such a restricted subsidiary).     Holdco Facilities     •
The covenants under the Holdco Facilities (including the Holdco Bridge Loans,
Holdco Extended Term Loans, Holdco Exchange Notes and any Takeout Securities
issued in lieu of the Holdco PIK Notes, collectively, the “Holdco Facilities”
and, together with the Opco Facilities, the “Facilities”) shall regulate the
Holdco Borrower and its restricted subsidiaries (with the Opco Borrower being
such a restricted subsidiary).     Financial Reporting     • Financial reporting
under each Facility shall be at the Holdco Borrower and its subsidiaries on a
consolidated basis.     Restricted Payments Covenant     • Tested at the Holdco
Borrower under both the Opco Facilities and Holdco Facilities.     Opco
Facilities     • Customary covenant, but regulating restricted payments by the
Holdco Borrower and its restricted subsidiaries and consisting of a customary
50% Consolidated Net Income “build-up” test and related Fixed Charge Coverage
Ratio condition, in each case using the Holdco Borrower’s financials, with
customary exceptions to be negotiated consistent with the Documentation
Principles, plus the additional exceptions described below.

Annex I-C-1

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

o

For so long as any Holdco Facilities are outstanding, the Opco Facilities will
treat any cash payment of principal or interest on the Holdco Facilities as a
“Restricted Payment” by the Holdco Borrower, with exceptions from this
particular limitation to include (i) a basket that will be in an amount
sufficient to (a) fund any interest payments on the Holdco Facilities that are
required by the terms thereof to be paid in cash and (b) fund certain voluntary
cash interest payments on the Holdco Facilities, (ii) repayments or redemptions
of principal and accrued interest under Holdco Facilities made by exchange for,
or with the proceeds of a substantially concurrent sale of, common equity by the
Holdco Borrower and (iii) the exception described in the bullet below.

 

o

In addition, the Opco Facilities will permit the repayment or redemption of
principal and accrued interest under Holdco Facilities made by exchange for, or
with the proceeds of a substantially concurrent sale of, indebtedness (or
preferred stock) of the Holdco Borrower; provided that such indebtedness (or
preferred stock) (1) is incurred in an aggregate principal amount (or issued
having an aggregate liquidation preference) equal to or less than the Holdco
Facilities being refinanced (taking into account any accrual of PIK interest to
the date of refinancing, and plus any additional indebtedness incurred to pay
premiums and expenses), (2) is, in the case of indebtedness, pari passu with or
subordinated to the guarantee of Holdco under the Opco Facilities and is
unsecured, (3) has a stated maturity (or, in the case of the preferred stock,
mandatory redemption, if any, or mandatory payment of liquidation preference, if
any) no earlier than the Holdco Facilities being refinanced and at least 91 days
later than the stated maturity of the Opco Facilities and a weighted average
life to maturity equal to or greater than the Holdco Facilities being
refinanced, (4) includes limitations on cash interest (or dividend) payments no
more favorable to the debtholders (or preferred stockholders) than those of the
Holdco Facilities being refinanced and (5) bears interest (or accrues dividends)
at a rate no greater than the interest rate applicable to the Holdco Facilities
being refinanced.

 

•

For so long as any Holdco Facilities are outstanding, the Opco Facilities shall
contain an additional covenant regulating certain restricted payments by the
Opco Borrower, consisting of a customary 50% of Consolidated Net Income
“build-up” test and related Fixed Charge Coverage Ratio condition, in each case
using the Holdco Borrower’s financials, with customary exceptions to be
negotiated consistent with the Documentation Principles, including (i) a basket
that will be in an amount sufficient to (a) fund any interest payments on the
Holdco Facilities that are required by the terms thereof to be paid in cash and
(b) fund certain voluntary cash interest payments on the Holdco Facilities, (ii)
an exception for excess asset sale proceeds that the Holdco Borrower may be
required to apply to the Existing Credit Facilities or the Holdco Facilities (it
being understood that proceeds of sales of assets of the European business shall
first be required to be offered to repay indebtedness under the Existing
European Credit Facility, the Existing North American Credit Facility, and the
Opco Facilities, in accordance with their terms, prior to being available to be
offered to repay Holdco Facilities), (iii) an exception for customary expenses
at the Holdco Borrower, (iv) repayments or redemptions of principal and accrued
interest under Opco Facilities made by exchange for, or with the proceeds of a
substantially concurrent sale of, common equity by the Opco Borrower and (v)
repayment or redemption of principal and accrued interest under Opco Facilities
made by exchange for, or with the proceeds of a substantially concurrent sale
of, indebtedness (or preferred stock) of the Opco Borrower; provided that such
indebtedness (or preferred stock) (1) is incurred in an aggregate principal
amount (or issued having an aggregate liquidation preference) equal to or less
than the Opco Facilities being refinanced, and plus any additional indebtedness
incurred to pay premiums and expenses), (2) is, in the case of indebtedness,
pari passu with or subordinated to the Existing North American Credit Facility
and (3) has a stated maturity (or, in the case of the preferred stock, mandatory
redemption, if any, or mandatory payment of liquidation preference, if any) no
earlier than the Opco Facilities being refinanced and a weighted average life to
maturity equal to or greater than the Opco Facilities being refinanced .

Annex I-C-2

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

o

This additional covenant shall regulate only dividends by the Opco Borrower to
the Holdco Borrower and repurchases by the Opco Borrower of the Holdco
Borrower’s stock and shall not regulate investments by the Opco Borrower or
repurchases of the Opco Borrower’s debt by the Opco Borrower.

 

•

For the avoidance of doubt, the Opco Facilities shall not restrict the payment
by Holdco of obligations owing by it under the ABL and shall not restrict the
upstreaming of funds from the Opco Borrower to the Holdco Borrower to be used
for such purpose.

 

•

The Opco Facilities shall permit any AHYDO “catch-up” payments to be made, but
only if required under applicable tax laws.

 

Holdco Facilities

 

•

Customary restricted payment covenant, consisting of a customary 50%
Consolidated Net Income “build-up” test and related Fixed Charge Coverage Ratio
condition, in each case using the Holdco Borrower’s financials, with customary
exceptions to be negotiated consistent with the Documentation Principles, plus
exceptions that match any additional exceptions described above, as applicable.

 

•

The Holdco Facilities shall permit any AHYDO “catch-up” payments to be made, but
only if required under applicable tax laws.

 

Debt and Preferred Stock Incurrence Covenant

 

•

Tested at the Holdco Borrower under both the Opco Facilities and Holdco
Facilities (all ratios are to be calculated using the Holdco Borrower’s
financials).

 

Opco Facilities

 

•

The Fixed Charge Coverage Ratio permission will be capped for non-guarantors at
an amount to be agreed.

 

•

The credit facilities basket shall permit growth based on accounts receivable
and inventory, not fixed asset collateral borrowing base.

Annex I-C-3

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

•

There shall be no restriction on the Opco Borrower or the Holdco Borrower
borrowing under the ABL, but any application of such borrowings to the Holdco
Borrower’s debt (other than payments of the ABL) would be subject to the
Restricted Payments covenant described above.

    •

Other baskets (including a general basket) to be agreed, and certain of these
baskets (including the general basket) to be agreed may also be capped for
non-guarantors.

   

Holdco Facilities

    •

The credit facilities basket shall permit growth based on accounts receivable
and inventory, not fixed asset collateral borrowing base.

    •

There shall be no restriction on the Holdco Borrower borrowing under the ABL,
but any application of such borrowings to the Holdco Borrower’s debt (other than
payments of the ABL) would be subject to the Restricted Payments covenant
described above.

    •

Other baskets (including a general basket) to be agreed.

   

Asset Sale Covenant

    •

Tested at the Holdco Borrower under both the Opco Facilities and Holdco
Facilities.

    •

Repayment of ABL debt and other debt of the Opco Borrower using proceeds from
all asset sales shall satisfy the asset sale covenant in both the Holdco
Facilities and the Opco Facilities. Repayment of debt of Opta Minerals using
proceeds of sale of assets of Opta Minerals shall satisfy the asset sale
covenant in both the Holdco Facilities and Opco Facilities.

   

Opco Facilities only

    •

If any Excess Proceeds remain and are required to be applied to payment of the
Holdco Facilities, the additional restricted payment covenant in the Opco
Facilities shall permit the Opco Borrower to make restricted payments to the
Holdco Borrower with “Excess Proceeds” from asset sales (it being understood
that proceeds of sales of assets of the European business shall first be
required to be offered to repay indebtedness under the Existing European Credit
Facility, the Existing North American Credit Facility and the Opco Facilities,
in accordance with their terms, prior to being available to be offered to repay
Holdco Facilities).

    •

If any Excess Proceeds from any sale of Opta Minerals remain after repayment of
Opta Minerals’ debt, such proceeds shall be applied first to reduce the Holdco
Facilities (if permitted by the Existing Credit Facilities), and thereafter to
reduce the Opco Facilities.

   

Affiliate Transactions Covenant

    •

The Opco Facilities and the Holdco Facilities shall permit all dealings and
transactions between and among (1) the Opco Borrower and its restricted
subsidiaries and (2) the Holdco Borrower and its restricted subsidiaries, as
well as other exceptions for dealings between and among such persons and other
affiliates.

Annex I-C-4

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

Lien Covenant     • The lien covenant in both Facilities shall regulate the
Holdco Borrower and the Lien covenant of the Opco Facilities shall regulate the
guarantors of such Facilities, and all ratio calculations shall be calculated
using the Holdco Borrower’s financials.     Dividend Stoppers Covenant     • The
additional restricted payment covenant described above in the Opco Facilities
shall be expressly permitted by the Holdco Facilities.     Merger Covenant     •
Each Facility shall contain a single covenant at the Holdco Borrower pertaining
to a merger of the Holdco Borrower or a sale of substantially all its assets    
Change of Control     • Each Facility shall contain a single covenant at the
Holdco Borrower pertaining to a change of control of the Holdco Borrower and the
Holdco Borrower ceasing to own 100% of the capital stock of the Opco Borrower.  
  Defaults     • Each Facility shall contain defaults pertaining to the Holdco
Borrower and its restricted subsidiaries (including the Opco Borrower).    
Definitions     • The Holdco Consolidated Net Income definition shall not
exclude the Opco Borrower’s net income due to the additional restricted payments
covenant at the Opco Borrower described above.     Other Changes
  • Such other changes reasonably requested by the Borrowers and agreed by the
Lead Arranger (acting reasonably) to reflect the need for ongoing operational
flexibility, consistent with the foregoing and the Documentation Principles.

Annex I-C-5

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

ANNEX II TO
EXHIBIT C

OPCO EXTENDED TERM LOANS

Maturity:

The Opco Extended Term Loans will mature on the date that is seven years after
the Closing Date.

   

Interest Rate:

The Opco Extended Term Loans will bear interest at a rate per annum equal to the
Opco Total Cap. Interest shall be payable quarterly and on the maturity date of
the Opco Extended Term Loans, in each case payable in arrears and computed on
the basis of a 365-day year.

   

Default Rate:

Upon the occurrence and during the continuance of any payment or bankruptcy
event of default, overdue principal, interest, fees and other amounts shall bear
interest at the applicable interest rate plus 2.0% per annum.

   

Guarantees:

Same as the Opco Bridge Loans.

   

Security:

Same as the Opco Bridge Loans.

   

Covenants, Defaults and Mandatory Offers to Purchase:

The covenants, mandatory offers to purchase and defaults which would be
applicable to the Opco Exchange Notes, if issued, will also be applicable to the
Opco Extended Term Loans in lieu of the corresponding provisions of the Opco
Bridge Facility.

   

Optional Prepayment:

The Opco Extended Term Loans may be prepaid, in whole or in part, at par, plus
accrued and unpaid interest upon not less than three days’ prior written notice,
at the option of the Opco Borrower at any time; provided that upon the
occurrence of an Opco Demand Failure Event, the outstanding Opco Extended Term
Loans will automatically and immediately be subject to the call protection
provisions applicable to the Opco Exchange Notes.

Annex II-C-1

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

ANNEX III TO
EXHIBIT C

OPCO EXCHANGE NOTES

Issuer:

The Borrower will issue the Opco Exchange Notes under an indenture. The Opco
Borrower or an affiliate, in its capacity as the issuer of the Opco Exchange
Notes, is referred to as the “Opco Issuer”.

   

Principal Amount:

The Opco Exchange Notes will be issued on or after the Opco Extension Date. The
principal amount of any Opco Exchange Note will equal 100% of the aggregate
principal amount of the Opco Extended Term Loan for which it is exchanged. In
the case of a partial exchange, the minimum amount of Opco Extended Term Loans
to be exchanged for Opco Exchange Notes will be $50,000,000 (or less if used to
exchange the entire outstanding amount of the Opco Extended Term Loans).

   

Maturity:

The Opco Exchange Notes will mature on the date that is seven years after the
Closing Date.

   

Interest Rate:

The Opco Exchange Notes will bear interest payable semi- annually at a weighted
average yield which shall not exceed the Opco Total Cap.

   

Guarantees:

Same as the Opco Extended Term Loans.

   

Security:

Same as the Opco Extended Term Loans.

   

Offer of Purchase upon Change of Control:

The Opco Issuer will be required to make an offer to repurchase the Opco
Exchange Notes following the occurrence of a change of control (to be defined in
a manner consistent with the high- yield debt offerings and consistent with the
Documentation Principles) at a price in cash equal to 101% (or 100% in the case
of Opco Exchange Notes held by the Commitment Parties or their respective
affiliates excluding Opco Exchange Notes held by them in connection with market
making activities or asset management affiliates purchasing the Opco Exchange
Notes in the ordinary course of their business as part of a regular distribution
of the Opco Exchange Notes (“Asset Management Affiliates”)) of the outstanding
principal amount thereof, plus accrued and unpaid interest to the date of
repurchase, unless the Opco Issuer shall redeem such Opco Exchange Notes
pursuant to the “Optional Redemption” section below.

   

Offer to Purchase from Asset Sale Proceeds:

The Opco Issuer will be required to make an offer to repurchase the Opco
Exchange Notes (and, if outstanding, prepay the Opco Extended Term Loans) on a
pro rata basis, which offer shall be at 100% of the principal amount thereof
plus accrued and unpaid interest to the date of repurchase with a portion of the
net cash proceeds from any non- ordinary course asset sales or dispositions
(including as a result of casualty or condemnation) by the Holdco Borrower or
any of its subsidiaries in excess of amounts either reinvested or required to be
paid to lenders under the Existing Credit Facilities (and, in the case of sales
of assets or capital stock of Opta Minerals, any other subsidiary of the Holdco
Borrower (other than the Opco Borrower and its subsidiaries) or any minority
interest owned by the Holdco Borrower or its restricted subsidiaries (other than
the Opco Borrower and its subsidiaries), the Holdco Facilities), with such
proceeds being applied to the Opco Extended Term Loans, the Opco Exchange Notes
and the Opco Notes in a manner to be agreed, subject to other exceptions and
baskets usual and customary for financings of this type consistent with the
Documentation Principles, except that there shall be no reinvestment rights in
respect of net cash proceeds (less the pro rata portion thereof attributable to
minority interest ownership thereof) of any sale of the capital stock or assets
of Opta Minerals (with such net cash proceeds also calculated after giving
effect to required payoff of Opta Minerals’ credit facility and any other
outstanding indebtedness of Opta Minerals in the case of sales of assets of Opta
Minerals) for so long as the Holdco Bridge Facility is outstanding.

Annex III-C-1

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

Optional Redemption:

The Opco Exchange Notes will be non-callable (subject to the exceptions in the
three succeeding paragraphs below) until the third anniversary of the Closing
Date. Thereafter, each Opco Exchange Note will be redeemable at the option of
the Borrower at par plus accrued interest plus a premium equal to three quarters
of the coupon on such Exchange Note during the fourth year after the Closing
Date, one half of the coupon on such Exchange Note during the fifth year after
the Closing Date and one-quarter of the coupon on such Exchange Note during the
sixth year after the Closing Date, which call premiums shall decline to zero on
the date that is the sixth anniversary of the Closing Date.

   

Prior to the third anniversary of the Closing Date, the Opco Borrower may redeem
Opco Exchange Notes at a make- whole price based on US Treasury notes with a
maturity closest to the third anniversary of the Closing Date plus 50 basis
points; provided that notwithstanding the foregoing, prior to the third
anniversary of the Closing Date, the Issuer may redeem up to 10% of the
aggregate principal amount of such Opco Exchange Notes during each twelve-month
period commencing with the date of first exchange into Opco Exchange Notes at a
price equal to 103% of the aggregate principal amount thereof plus any accrued
and unpaid interest thereon.

Annex III-C-2

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

Prior to the third anniversary of the Closing Date, the Opco Borrower may redeem
up to 35.0% in the aggregate of the Opco Exchange Notes with proceeds from
qualified equity offerings of the Holdco Borrower at a redemption price equal to
par plus the coupon on such Opco Exchange Notes.

   

The optional redemption provisions will be otherwise customary for high yield
transactions consistent with the Documentation Principles.

   

Notwithstanding any of the foregoing, any Opco Exchange Notes held by (and for
so long as they are held by) the Commitment Parties or their respective
affiliates (other than Asset Management Affiliates or Opco Exchange Notes
purchased in the secondary market) shall be redeemable at any time and from time
to time at the option of the Opco Borrower at a redemption price equal to par
plus accrued and unpaid interest to the redemption date.

   

Defeasance Provisions:

Customary for high yield transactions and consistent with the Documentation
Principles.

   

Amendment/Waiver:

Customary for high yield transactions and consistent with the Documentation
Principles.

   

Covenants:

Customary for high yield transactions and consistent with the Documentation
Principles and otherwise reflecting the provisions of Annex I to Exhibit C.

   

Registration Rights:

None.

   

Right to Transfer Opco Exchange Notes:

The holders of the Opco Exchange Notes (including the Opco Bridge Lenders) shall
have the right to transfer such Opco Exchange Notes to any third parties,
subject to compliance with applicable securities and other law.

   

Events of Default:

Customary for high yield transactions and consistent with the Documentation
Principles and otherwise reflecting the provisions of Annex I to Exhibit C.

Annex III-C-3

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

Governing Law and Forum:

New York.

Annex III-C-4

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

EXHIBIT D

PROJECT SHINE
SUMMARY OF ADDITIONAL CONDITIONS3

The borrowings under the Bridge Facilities shall be subject to satisfaction of
the following conditions, in the sole determination of the Lead Arranger
(subject in all respects to the Certain Funds Provisions):

1.

The Acquisition shall have been consummated, or substantially simultaneously
with the borrowing under the Bridge Facilities shall be consummated, in all
material respects in accordance with the terms of the Acquisition Agreement,
after giving effect to any modifications, amendments, consents, waivers or
requests by you (or your affiliate) thereto, other than those (including the
effects of any requests) that are materially adverse to the interests of the
Lenders, without the prior consent of the Lead Arranger (such consent not to be
unreasonably withheld, delayed or conditioned); provided that (a) any reduction
in the amount referred to in clause (A) of Section 2.2(a)(i) of the Acquisition
Agreement (the “Base Purchase Price”) shall not be deemed to be materially
adverse to the interests of the Lenders; provided, further, that, any such
reduction in the Base Purchase Price shall be applied 100% to reduce the amount
of funding under the Holdco Bridge Facility, the Holdco PIK Notes and/or the
Equity Securities ratably and thereafter, to reduce the amount of funded debt
under the Opco Bridge Facility and the Opco Notes; provided, further that the
amount of funded debt under the Opco Bridge Facility and the Opco Notes (and/or
any Takeout Securities issued in lieu of any Opco Notes) shall not be less than
$250,000,000 and (b) any amendment, modification, waiver, consent or request in
respect of the definition of “Material Adverse Effect” shall be deemed to be
materially adverse to the interests of the Lenders.

 

 

2.

(a) Except as set forth on the Seller Disclosure Schedule (as defined in the
Acquisition Agreement), since December 31, 2014 through the date of the
Acquisition Agreement, there has not occurred any event that would reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect
(as defined in the Acquisition Agreement) and (b) between the date of the
Acquisition Agreement and the Closing Date (as defined in the Acquisition
Agreement), there has been no event, circumstance, development, change or effect
that would reasonably be expected to have a Material Adverse Effect. Any
disclosure with respect to a section or schedule of the Acquisition Agreement
(including any section of the Seller Disclosure Schedule) shall be deemed to
have been disclosed for other sections and schedules of the Acquisition
Agreement (including a section of the Seller Disclosure Schedule) where the
relevance of such disclosure would be reasonably apparent.

 

 

3.

After giving effect to the Transactions, the Holdco Borrower and its
subsidiaries (excluding the Target and its subsidiaries) shall have outstanding
no third party indebtedness for borrowed money in excess of $720 million (other
than non-recourse indebtedness of Opta Minerals and assuming the Existing Credit
Facilities are fully drawn) and from the date hereof until the Closing Date, the
Holdco Borrower and its subsidiaries (excluding the Target and its subsidiaries)
shall only incur third party indebtedness for borrowed money for working capital
purposes in the ordinary course of business (as reasonably determined in good
faith by the Holdco Borrower) except for (i) indebtedness incurred to finance
the Transactions and (ii) indebtedness not in excess of $10 million to finance
other acquisitions.

_______________________________________

3 All capitalized terms used but not defined herein shall have the meanings
given to them in the Commitment Letter to which this Term Sheet is attached,
including the Exhibits thereto. In the event any such capitalized term is
subject to multiple or differing definitions, the appropriate meaning thereof in
this Exhibit D shall be determined by reference to the context in which it is
used.

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4.

The Lead Arranger shall have received (a) unaudited combined balance sheets and
related statements of income and cash flows of Target and its subsidiaries for
each fiscal quarter (that is not the last fiscal quarter of a fiscal year)
commencing on or after December 31, 2014, and ended at least 45 days prior to
the Closing Date, and (b) audited combined balance sheets and related statements
of income and cash flows of Target and its subsidiaries for the three most
recently completed fiscal years ended at least 90 days before the Closing Date.
The Lead Arranger acknowledges receipt of the audited financial statements of
the Target and its subsidiaries for the three years ended December 31, 2014 and
of the unaudited financial statements of the Target and its subsidiaries for the
fiscal quarter ended March 31, 2015.

 

 

5.

The Lead Arranger shall have received a pro forma consolidated balance sheet and
related pro forma consolidated statement of income of the Holdco Borrower for
the twelve month period ending on the last day of the most recently completed
four-fiscal quarter period ended at least 90 days prior to the Closing Date (if
the end of such period is a fiscal year-end of the Holdco Borrower) or ended at
least 45 days prior to the Closing Date (if the end of such period is not a
fiscal year end of the Holdco Borrower), in each case, prepared after giving
effect to the Transactions as if the Transactions had occurred as of such date
(in the case of such balance sheet) or at the beginning of such period (in the
case of the statement of income), which need not include adjustments for
purchase accounting (including adjustments of the type contemplated by Financial
Accounting Standards Board Accounting Standards Codification 805, Business
Combinations (formerly SFAS 141R)).

 

 

6.

The Bridge Administrative Agent and the Lead Arranger shall have received, no
later than three days prior to the Closing Date, all documentation and other
information about the Borrowers and the Guarantors as has been reasonably
requested in writing by the Bridge Administrative Agent and the Lead Arranger at
least ten Business Days prior to the Closing Date that is required by regulatory
authorities under applicable “know your customer” and anti-money laundering
rules and regulations, including without limitation AML Law.

 

 

7.

(a) (i) With respect to the Holdco Bridge Facility, (x) the execution and
delivery by the Holdco Borrower of the Holdco Bridge Facility Documentation (as
defined in Exhibit B), which shall be in accordance with the terms of the
Commitment Letter and the Holdco Term Sheet and subject to Certain Funds
Provisions and the Documentation Principles set forth in the Commitment Letter
and (y) delivery to the Bridge Administrative Agent of (i) a customary borrowing
notice (subject to the Certain Funds Provisions), customary legal opinions,
customary officer’s closing certificates, organizational documents, customary
evidence of authorization and good standing certificates in the jurisdiction of
formation, in each case, with respect to the Holdco Borrower, and (ii) a
solvency certificate, dated as of the Closing Date and after giving effect to
the Transactions, substantially in the form of Annex I attached to this Exhibit
D, of a senior authorized financial executive or officer of the Holdco Borrower.

D-2

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(b) with respect to the Opco Bridge Facility, (x) the execution and delivery by
the Opco Borrower and the Guarantors (as such term are defined in Exhibit C) of
the Opco Bridge Facility Documentation (as defined in Exhibit C) (including
guarantees by the applicable guarantors, which shall include the Target and its
subsidiaries only after consummation of the Acquisition), which shall be in
accordance with the terms of the Commitment Letter and the Opco Term Sheet and
subject to the Certain Funds Provisions and the Documentation Principles set
forth in the Commitment Letter and (y) delivery to the Bridge Administrative
Agent of (i) a customary borrowing notice (subject to the Certain Funds
Provisions), customary legal opinions, customary officer’s closing certificates,
organizational documents, customary evidence of authorization and good standing
certificates in jurisdictions of formation/organization, in each case with
respect to the Opco Borrower and the Guarantors (to the extent applicable) and
(ii) a solvency certificate, dated as of the Closing Date and after giving
effect to the Transactions, substantially in the form of Annex I attached to
this Exhibit D, of a senior authorized financial executive or officer of the
Holdco Borrower or the Opco Borrower;

8.

With respect to the Opco Bridge Facility, subject in all respects to the Certain
Funds Provisions, all documents and instruments required to create and perfect
the Bridge Administrative Agent’s security interest in the Collateral (as
defined in Exhibit C) shall have been executed and delivered and, if applicable,
be in proper form for filing.

 

 

9.

All fees required to be paid on the Closing Date pursuant to the Commitment
Letter and the Fee Letter and reasonable and documented out-of-pocket expenses
required to be paid on the Closing Date pursuant to the Commitment Letter, to
the extent invoiced at least three Business Days prior to the Closing Date,
shall, upon the borrowing under the Bridge Facilities, have been paid (which
amounts may be offset against the proceeds of the Bridge Facilities).

 

 

10.

(a) With respect to the Opco Bridge Facility, (1) you shall have engaged one or
more investment banks reasonably acceptable to the Lead Arranger (in such
capacity, the “Debt Investment Banks”) to act as book-running managers and as
underwriters, initial purchasers or placement agents to sell or privately place
the Opco Notes and any related Takeout Securities to be issued by the Opco
Borrower to consummate the Acquisition (the “Opco Debt Transactions”) (the Lead
Arranger hereby acknowledges that such reasonably acceptable Debt Investment
Banks have been so engaged) and (2) you shall have provided the Debt Investment
Banks with (A) a customary preliminary offering memorandum (the “Opco Offering
Memorandum”) suitable for use in a customary “high yield road show” relating to
the Opco Notes and in customary form for preliminary offering memoranda used in
private placements of non-convertible debt securities, including or
incorporating all financial statements and other information (which financial
statements and other information may also relate to the Holdco Borrower) that
would customarily be included in offering memoranda for use in the United States
under Rule 144A (it being understood none of such information need include
financial statements required by Rules 3-09, 3-10 or 3-16 of Regulation S-X,
Compensation Discussion and Analysis or other information required by Item 402
of Regulation S-K and the executive compensation and related person disclosure
rules related to SEC Release Nos. 33-8732A, 34-54302A and IC-27444A and other
customary exceptions); provided that this condition shall be deemed satisfied if
the Opco Offering Memorandum excludes the “description of notes” and other
information or sections that would customarily be provided by the Debt
Investment Banks or their counsel; provided further that the only information
relating to the Target and its subsidiaries required to be included in the Opco
Offering Memorandum shall consist of the Required Information (as defined in
Annex II to this Exhibit D) and (B) drafts of customary “comfort” letters with
respect to the financial information in the Opco Offering Memorandum by auditors
of the Target and the Holdco Borrower, which such auditors are prepared to issue
upon completion of customary procedures. The Debt Investment Banks shall have
been afforded a period of at least 17 consecutive Business Days following
delivery by the Opco Borrower of an Opco Offering Memorandum including the
information described in clause (2)(A) above (such information, the “Opco Notes
Marketing Information”) (the “Opco Marketing Period”) and prior to the Closing
Date to seek to offer and sell or privately place the Opco Notes with qualified
purchasers thereof; provided, however, that (x) such 17 consecutive Business Day
period will not commence until September 9, 2015, (y) if such 17 consecutive
Business Day period has not ended prior to December 18, 2015, it will not
commence until January 4, 2016 and (z) November 27, 2015 shall not be considered
a Business Day for purposes of the Opco Marketing Period. For purposes of this
Exhibit D, Business Day means any day that is not a Saturday, a Sunday or other
day on which commercial banks in New York, New York or Toronto, Ontario are
required or authorized by applicable law to be closed; provided, further, that
if you shall in good faith reasonably believe that the Opco Notes Marketing
Information has been delivered, you may deliver to the Commitment Parties a
written notice to that effect (stating when you believe the delivery of the Opco
Notes Marketing Information to the Debt Investment Banks was completed), in
which case you shall be deemed to have complied with such obligation to furnish
the Opco Notes Marketing Information and the Debt Investment Banks shall be
deemed to have received the Opco Notes Marketing Information, unless the
Commitment Parties in good faith reasonably believe that you have not completed
the delivery of such Opco Notes Marketing Information and, not later than 5:00
p.m. (New York time) two business days after the delivery of such notice by you,
deliver a written notice to you to that effect (stating with specificity which
such Opco Notes Marketing Information has not been delivered); provided, that
notwithstanding the foregoing, the delivery of the Opco Notes Marketing
Information shall be satisfied at any time at which (and so long as) the Debt
Investment Banks shall have actually received the Opco Notes Marketing
Information, regardless of whether or when any such notice is delivered by you.

D-3

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(b) With respect to the Holdco Bridge Facility, (1) you shall have engaged Debt
Investment Banks to act as book-running managers and as underwriters, initial
purchasers or placement agents to sell or privately place the Holdco PIK Notes
and any related Takeout Securities to be issued by the Holdco Borrower to
consummate the Acquisition (the “Holdco Debt Transactions”) (the Lead Arranger
hereby acknowledges that such reasonably acceptable Debt Investment Banks have
been so engaged) and (2) you shall have provided the Debt Investment Banks with
(A) a customary preliminary offering memorandum (the “Holdco Offering
Memorandum”) suitable for use in a customary “high yield road show” relating to
the Holdco PIK Notes or such other debt securities, as the case may be, and in
customary form for preliminary offering memoranda used in private placements of
non-convertible debt securities, including or incorporating all financial
statements and other information that would customarily be included in offering
memoranda for use in the United States under Rule 144A (it being understood none
of such information need include financial statements required by Rules 3-09,
3-10 or 3-16 of Regulation S-X, Compensation Discussion and Analysis or other
information required by Item 402 of Regulation S-K and the executive
compensation and related person disclosure rules related to SEC Release Nos.
33-8732A, 34-54302A and IC-27444A and other customary exceptions); provided that
this condition shall be deemed satisfied if the Holdco Offering Memorandum
excludes the “description of notes” and other information or sections that would
customarily be provided by the Debt Investment Banks or their counsel; provided
further that the only information relating to the Target and its subsidiaries
required to be included in the Holdco Offering Memorandum shall consist of the
Required Information (as defined in Annex II to this Exhibit D) and (B) drafts
of customary “comfort” letters with respect to the financial information in the
Holdco Offering Memorandum by auditors of the Target and the Holdco Borrower
which such auditors are prepared to issue upon completion of customary
procedures. The Debt Investment Banks shall have been afforded a period of at
least 17 consecutive business days following delivery by the Holdco Borrower of
a Holdco Offering Memorandum including the information described in clause
(2)(A) above (such information, the “Holdco Notes Marketing Information”) (the
“Holdco Marketing Period”) and prior to the Closing Date to seek to offer and
sell or privately place the Holdco PIK Notes or the other debt securities with
qualified purchasers thereof; provided, however, that (x) such 17 consecutive
Business Day period will not commence until September 9, 2015, (y) if such 17
consecutive Business Day period has not ended prior to December 18, 2015, it
will not commence until January 4, 2016 and (z) November 27, 2015 shall not be
considered a Business Day for purposes of the Holdco Marketing Period; provided,
further, that if you shall in good faith reasonably believe that the Holdco
Notes Marketing Information has been delivered, you may deliver to the
Commitment Parties a written notice to that effect (stating when you believe the
delivery of the Holdco Notes Marketing Information to the Debt Investment Banks
was completed), in which case you shall be deemed to have complied with such
obligation to furnish the Holdco Notes Marketing Information and the Debt
Investment Banks shall be deemed to have received the Holdco Notes Marketing
Information, unless the Commitment Parties in good faith reasonably believe that
you have not completed the delivery of such Holdco Notes Marketing Information
and, not later than 5:00 p.m. (New York time) two business days after the
delivery of such notice by you, deliver a written notice to you to that effect
(stating with specificity which such Holdco Notes Marketing Information has not
been delivered); provided, that notwithstanding the foregoing, the delivery of
the Holdco Notes Marketing Information shall be satisfied at any time at which
(and so long as) the Debt Investment Banks shall have actually received the
Holdco Notes Marketing Information, regardless of whether or when any such
notice is delivered by you.

D-4

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11.

You shall have engaged one or more investment banks reasonably acceptable to the
Lead Arranger (in such capacity, the “Equity Securities Investment Banks”) to
act as book- running managers and/or as underwriters, initial purchasers or
placement agents, to sell or underwrite the Equity Securities to be issued by
the Holdco Borrower pursuant to a registered public offering in the United
States or in a private placement, including pursuant to Rule 144A or other
exemption from registration under the Securities Act of 1933, as amended (the
“Equity Securities Transaction”) (the Lead Arranger hereby acknowledges that
such reasonably acceptable Equity Securities Investment Banks have been so
engaged).

D-5

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12.

The Specified Acquisition Agreement Representations shall be true and correct,
but only to the extent that SunOpta Inc. has (or an applicable affiliate has)
the right to terminate SunOpta Inc.’s (or such affiliate’s) obligations under
the Acquisition Agreement or decline to consummate the Acquisition as a result
of a breach of such representations and warranties in the Acquisition Agreement
and the Specified Representations shall be true and correct in all material
respects (where not already qualified by materiality, otherwise in all respects)
(except in the case of any Specified Representation which expressly relates to a
given date or period, such representation and warranty shall be true and correct
in all material respects (where not already qualified by materiality, otherwise
in all respects) as of the respective date or respective period, as the case may
be).

D-6

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ANNEX I TO
EXHIBIT D

FORM OF SOLVENCY CERTIFICATE

SOLVENCY CERTIFICATE
of
[BORROWERS]
AND THEIR SUBSIDIARIES

The undersigned hereby certifies, solely in such undersigned’s capacity as
[chief financial officer] of the Borrowers, and not individually, and without
personal liability, as follows:

As of the date hereof, after giving effect to the consummation of the
Transactions, including the making of the loans under the Existing North
American Facility, the incurrence of the loans under the Bridge Facilities and
the issuance of the Notes on the date hereof, and after giving effect to the
application of the proceeds of such indebtedness:

 

(a)

The fair value of the assets of the Holdco Borrower and its subsidiaries, on a
consolidated basis, exceeds, on a consolidated basis, their debts and
liabilities, subordinated, contingent or otherwise;

 

 

 

 

(b)

The present fair saleable value of the property of the Holdco Borrower and its
subsidiaries, on a consolidated basis, is greater than the amount that will be
required to pay the probable liability, on a consolidated basis, of their debts
and other liabilities, subordinated, contingent or otherwise, as such debts and
other liabilities become absolute and matured;

 

 

 

 

(c)

The Holdco Borrower and its subsidiaries, on a consolidated basis, are able to
pay their debts and liabilities, subordinated, contingent or otherwise, as such
liabilities become absolute and matured;

 

 

 

 

(d)

The Holdco Borrower and its subsidiaries, on a consolidated basis, are not
engaged in, and are not about to engage in, business for which they have
unreasonably small capital; and

 

 

 

 

(e)

Neither the Holdco Borrower [nor the Opco Borrower] are an “insolvent person”
within the meaning of the Bankruptcy and Insolvency Act (Canada).

For purposes of this Solvency Certificate, the amount of any contingent
liability at any time shall be computed as the amount that would reasonably be
expected to become an actual and matured liability. Capitalized terms used but
not otherwise defined herein shall have the meanings assigned to them in the
Commitment Letter.

[Signature Page Follows]

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IN WITNESS WHEREOF, the undersigned has executed this Solvency Certificate in
such undersigned’s capacity as [chief financial officer] of the Borrowers, on
behalf of the Borrowers, and not individually, and without personal liability,
as of the date first stated above.

  [___________________]              By:   Name:   Title:

Annex I-D-2

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ANNEX II TO
EXHIBIT D

Capitalized terms used in this Annex II to Exhibit D but not defined in this
Annex II to Exhibit D have the meanings assigned to such terms in the
Acquisition Agreement.

“Debt Investment Banks” has the meaning assigned to such term in Exhibit D.
“Required Information” means the following:

(i)

audited consolidated financial statements (and related footnotes) of the Company
and its Subsidiaries prepared on a consolidated basis in accordance with GAAP
and of the type required by Regulation S-X under the Securities Act for an
offering of debt securities, together with an audit report thereon, for each of
the fiscal years in the three-year period ending December 31, 2014;

 

 

(ii)

unaudited and reviewed consolidated financial statements (and related footnotes)
of the Company and its Subsidiaries prepared on a consolidated basis in
accordance with GAAP and of the type required by Regulation S-X under the
Securities Act for an offering of debt securities for the six-month periods
ended June 30, 2015 and 2014 or, if the Marketing Period shall not have been
completed by the Staleness Date, for the nine- month periods ending September
30, 2015 and 2014;

 

 

(iii)

historical financial information and historical financial data of the Company
and its Subsidiaries solely to the extent such information and data is necessary
in order for you to prepare (A) customary pro forma financial statements in
accordance with Article 11 of Regulation S-X under the Securities Act for the
following periods: (I) the fiscal year ended December 31, 2014, (II) the six
months ended June 30, 2015 or, if the Marketing Period shall not have been
completed by the Staleness Date, the nine months ended September 30, 2015 and
(III) the six months ended June 30, 2014 or, if the Marketing Period shall not
have been completed by the Staleness Date, for the nine months ending September
30, 2014 (and related footnotes) and (B) a customary “Pro Forma Adjusted EBITDA”
presentation of the Company and its Subsidiaries;

 

 

(iv)

data and information of the Company and its Subsidiaries reasonably required in
order to prepare an abbreviated “Business” section for the Offering Documents,
describing the business of the Company and its Subsidiaries;

 

 

(v)

data and information of the Company and its Subsidiaries reasonably required in
order to prepare an abbreviated “Management’s Discussion and Analysis of
Financial Condition and Results of Operations” section for the Offering
Documents, containing a customary results of operations discussion relating to
the financial statements described in clauses (i) and (ii) above;

 

 

(vi)

a description of risk factors relating to the business of the Company and its
Subsidiaries for the Offering Documents (other than any such risk factors
relating to global or national economic, financial or political conditions or
risk factors affecting the Company’s industry generally); and

Annex II-D-1

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(vii)

all other historical financial and historical accounting data that is reasonably
required by the Debt Investment Banks, solely to the extent such information and
data is necessary for the underwriter or initial purchaser of an offering of
such securities to receive customary “comfort” (including customary “negative
assurance” comfort) from independent accountants in connection with the
Financing, which such auditors are prepared to provide upon completion of
customary procedures.

Annex II-D-2

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