Document:

Loan and Security Agreement

  
 Exhibit 10.3

  
  

 
 CLEARWATER PAPER CORPORATION,

 as Borrower 
 LOAN AND SECURITY AGREEMENT 
 Dated as of November 26, 2008 

$125,000,000 

CERTAIN FINANCIAL INSTITUTIONS, 
 as Lenders 
 and 

BANK OF AMERICA, N.A., 
 as Agent 
  
  

 

 TABLE OF CONTENTS 

 

					
	 	  	 	  	 Page

	 Section 1.
	  	 DEFINITIONS; RULES OF CONSTRUCTION
	  	1
	 1.1.
	  	 Definitions
	  	1
	 1.2.
	  	 Accounting Terms
	  	24
	 1.3.
	  	 Uniform Commercial Code
	  	24
	 1.4.
	  	 Certain Matters of Construction
	  	24
	 Section 2.
	  	 CREDIT FACILITIES
	  	25
	 2.1.
	  	 Revolver Commitment
	  	25
	 2.2.
	  	 Intentionally Omitted
	  	27
	 2.3.
	  	 Letter of Credit Facility
	  	27
	 Section 3.
	  	 INTEREST, FEES AND CHARGES
	  	29
	 3.1.
	  	 Interest
	  	29
	 3.2.
	  	 Fees
	  	30
	 3.3.
	  	 Computation of Interest, Fees, Yield Protection
	  	30
	 3.4.
	  	 Reimbursement Obligations
	  	31
	 3.5.
	  	 Illegality
	  	31
	 3.6.
	  	 Inability to Determine Rates
	  	31
	 3.7.
	  	 Increased Costs; Capital Adequacy
	  	32
	 3.8.
	  	 Mitigation
	  	33
	 3.9.
	  	 Funding Losses
	  	33
	 3.10.
	  	 Maximum Interest
	  	33
	 Section 4.
	  	 LOAN ADMINISTRATION
	  	33
	 4.1.
	  	 Manner of Borrowing and Funding Revolver Loans
	  	33
	 4.2.
	  	 Defaulting Lender
	  	35
	 4.3.
	  	 Number and Amount of LIBOR Loans; Determination of Rate
	  	35
	 4.4.
	  	 Borrower Agent
	  	35
	 4.5.
	  	 One Obligation
	  	35
	 4.6.
	  	 Effect of Termination
	  	35
	 Section 5.
	  	 PAYMENTS
	  	36
	 5.1.
	  	 General Payment Provisions
	  	36
	 5.2.
	  	 Repayment of Revolver Loans
	  	36
	 5.3.
	  	 Intentionally Omitted
	  	36
	 5.4.
	  	 Payment of Other Obligations
	  	36
	 5.5.
	  	 Marshaling; Payments Set Aside
	  	36
	 5.6.
	  	 Post-Default Allocation of Payments
	  	36
	 5.7.
	  	 Application of Payments
	  	37
	 5.8.
	  	 Loan Account; Account Stated
	  	37
	 5.9.
	  	 Taxes
	  	38
	 5.10.
	  	 Lender Tax Information
	  	38
	 5.11.
	  	 Nature and Extent of Each Borrower’s Liability
	  	39
	 Section 6.
	  	 CONDITIONS PRECEDENT
	  	41
	 6.1.
	  	 Conditions Precedent to Initial Loans
	  	41
	 6.2.
	  	 Conditions Precedent to All Credit Extensions
	  	43
	 6.3.
	  	 Conditions Precedent to Effectiveness of Certain Sections
	  	43
	 Section 7.
	  	 COLLATERAL
	  	43
	 7.1.
	  	 Grant of Security Interest
	  	43
	 7.2.
	  	 Lien on Deposit Accounts; Cash Collateral
	  	44
	 7.3.
	  	 Intentionally Omitted
	  	44
	 7.4.
	  	 Certain After-Acquired Collateral
	  	44

					
	 7.5.
	  	 No Assumption of Liability
	  	45
	 7.6.
	  	 Further Assurances
	  	45
	 Section 8.
	  	 COLLATERAL ADMINISTRATION
	  	45
	 8.1.
	  	 Borrowing Base Certificates
	  	45
	 8.2.
	  	 Administration of Accounts
	  	45
	 8.3.
	  	 Administration of Inventory
	  	46
	 8.4.
	  	 Condition of Equipment
	  	46
	 8.5.
	  	 Administration of Deposit Accounts
	  	47
	 8.6.
	  	 General Provisions
	  	47
	 8.7.
	  	 Power of Attorney
	  	48
	 Section 9.
	  	 REPRESENTATIONS AND WARRANTIES
	  	48
	 9.1.
	  	 General Representations and Warranties
	  	48
	 9.2.
	  	 Complete Disclosure
	  	52
	 Section 10.
	  	 COVENANTS AND CONTINUING AGREEMENTS
	  	53
	 10.1.
	  	 Affirmative Covenants
	  	53
	 10.2.
	  	 Negative Covenants
	  	55
	 10.3.
	  	 Fixed Charge Coverage Ratio
	  	60
	 Section 11.
	  	 EVENTS OF DEFAULT; REMEDIES ON DEFAULT
	  	61
	 11.1.
	  	 Events of Default
	  	61
	 11.2.
	  	 Remedies upon Default
	  	62
	 11.3.
	  	 License
	  	63
	 11.4.
	  	 Setoff
	  	63
	 11.5.
	  	 Remedies Cumulative; No Waiver
	  	63
	 Section 12.
	  	 AGENT
	  	64
	 12.1.
	  	 Appointment, Authority and Duties of Agent
	  	64
	 12.2.
	  	 Agreements Regarding Collateral and Field Examination Reports
	  	65
	 12.3.
	  	 Reliance By Agent
	  	65
	 12.4.
	  	 Action Upon Default
	  	65
	 12.5.
	  	 Ratable Sharing
	  	65
	 12.6.
	  	 Indemnification of Agent Indemnitees
	  	66
	 12.7.
	  	 Limitation on Responsibilities of Agent
	  	66
	 12.8.
	  	 Successor Agent and Co-Agents
	  	66
	 12.9.
	  	 Due Diligence and Non-Reliance
	  	67
	 12.10.
	  	 Replacement of Certain Lenders
	  	67
	 12.11.
	  	 Remittance of Payments and Collections
	  	67
	 12.12.
	  	 Agent in its Individual Capacity
	  	68
	 12.13.
	  	 Agent Titles
	  	68
	 12.14.
	  	 No Third Party Beneficiaries
	  	68
	 Section 13.
	  	 BENEFIT OF AGREEMENT; ASSIGNMENTS AND PARTICIPATIONS
	  	68
	 13.1.
	  	 Successors and Assigns
	  	68
	 13.2.
	  	 Participations
	  	69
	 13.3.
	  	 Assignments
	  	69
	 Section 14.
	  	 MISCELLANEOUS
	  	70
	 14.1.
	  	 Consents, Amendments and Waivers
	  	70
	 14.2.
	  	 Indemnity
	  	70
	 14.3.
	  	 Notices and Communications
	  	71
	 14.4.
	  	 Performance of Borrowers’ Obligations
	  	71
	 14.5.
	  	 Credit Inquiries
	  	71
	 14.6.
	  	 Severability
	  	71
	 14.7.
	  	 Cumulative Effect; Conflict of Terms
	  	71
	 14.8.
	  	 Counterparts
	  	72
	 14.9.
	  	 Entire Agreement
	  	72

  

 (ii) 

					
	 14.10.
	  	 Relationship with Lenders
	  	72
	 14.11.
	  	 No Advisory or Fiduciary Responsibility
	  	72
	 14.12.
	  	 Confidentiality
	  	72
	 14.13.
	  	 Intentionally Omitted
	  	73
	 14.14.
	  	 GOVERNING LAW
	  	73
	 14.15.
	  	 Consent to Forum; Arbitration
	  	73
	 14.16.
	  	 Waivers by Borrowers
	  	74
	 14.17.
	  	 Patriot Act Notice
	  	74

 LIST OF EXHIBITS
AND SCHEDULES 
  

			
	Exhibit A	  	Revolver Note
	Exhibit B	  	Assignment and Acceptance
	Exhibit C	  	Assignment Notice

  

			
	Schedule P-1	  	Investments
	Schedule 1.1	  	Commitments of Lenders
	Schedule 8.5	  	Deposit Accounts
	Schedule 8.6.1	  	Business Locations
	Schedule 9.1.4	  	Names and Capital Structure
	Schedule 9.1.11	  	Patents, Trademarks, Copyrights and Licenses
	Schedule 9.1.14	  	Environmental Matters
	Schedule 9.1.15	  	Restrictive Agreements
	Schedule 9.1.16	  	Litigation
	Schedule 9.1.18	  	Pension Plans
	Schedule 9.1.20	  	Labor Contracts
	Schedule 10.2.2	  	Existing Liens
	Schedule 10.2.17	  	Existing Affiliate Transactions

  

 (iii) 

 LOAN AND SECURITY AGREEMENT 

This LOAN AND SECURITY AGREEMENT (this “Agreement”) is dated as of November 26, 2008, among POTLATCH
FOREST PRODUCTS CORPORATION, which will change its name prior to the Closing Date to CLEARWATER PAPER CORPORATION, a Delaware corporation (“Clearwater” and together with any other Person that at any time after the date
hereof becomes a Borrower in accordance with the terms hereof, each individually a “Borrower” and collectively, “Borrowers”), the financial institutions party to this Agreement from time to time as lenders (each
individually a “Lender” and collectively, “Lenders”), and BANK OF AMERICA, N.A., a national banking association, as agent for the Lenders (“Agent”). 

R E C I T A L S: 
 Borrowers have requested that Lenders provide a credit facility to Borrowers to finance their mutual and collective business enterprise. Lenders are willing to provide the credit facility on the terms and
conditions set forth in this Agreement. 
 NOW, THEREFORE, for valuable consideration hereby acknowledged, the parties
agree as follows: 
 SECTION 1. DEFINITIONS; RULES OF CONSTRUCTION 

1.1. Definitions. As used herein, the following terms have the meanings set forth below: 

Account: as defined in the UCC, and all rights to payment for goods sold or leased, or for services rendered. 

Account Debtor: a Person who is obligated under an Account or General Intangible. 

Accounts Formula Amount: 85% of the Value of Eligible Accounts. 

Acquisition: the purchase or other acquisition by a Borrower of all or substantially all of the assets of any other Person, or the
purchase or other acquisition (whether by means of a merger, consolidation, or otherwise) by a Borrower of all or substantially all of the Equity Interests of any other Person. 

Affiliate: with respect to any Person, another Person that directly, or indirectly through one or more intermediaries, Controls or
is Controlled by or is under common Control with the Person specified. “Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through
the ability to exercise voting power, by contract or otherwise. “Controlling” and “Controlled” have correlative meanings. 
 Agent Fee Letter: the fee letter agreement between Agent and Borrowers. 

Agent Indemnitees: Agent and its officers, directors, employees, Affiliates, agents and attorneys. 

Agent Professionals: attorneys, accountants, appraisers, auditors, business valuation experts, environmental engineers or
consultants, turnaround consultants, and other professionals and experts retained by Agent. 
 Allocable Amount: as
defined in Section 5.11.3. 
 Anti-Terrorism Laws: any laws relating to terrorism or money laundering,
including the Patriot Act. 

 Applicable Law: with respect to a Person, all laws, rules, regulations and
governmental guidelines applicable to such Person or its conduct, transaction, agreement or matter in question, including all applicable statutory law, common law and equitable principles, and all provisions of constitutions, treaties, statutes,
rules, regulations, orders and decrees of Governmental Authorities. 
 Applicable Margin: with respect to any Type of
Loan, the margin set forth below, as determined by the Fixed Charge Coverage Ratio for the last Fiscal Quarter: 
  

									
	 Level
	  	 Fixed Charge Coverage Ratio
	  	Base Rate
Revolver Loans	 	 	LIBOR
Revolver Loans	 
	I	  	Greater than or equal to 1.50 to 1.00	  	1.00	% 	 	2.75	% 
				
	II	  	Less than 1.50 to 1.00 but greater than or equal to 1.25 to 1.00	  	1.25	% 	 	3.00	% 
				
	III	  	Less than 1.25 to 1.00 but greater than or equal to 1.00 to 1.00	  	1.50	% 	 	3.25	% 
				
	IV	  	Less than 1.00 to 1.00	  	1.75	% 	 	3.50	% 

 Notwithstanding the forgoing,
from the date hereof until the first day of the month following receipt by Agent pursuant to Section 10.1.2 of the financial statements and corresponding Compliance Certificate for the Fiscal Quarter ending March 31, 2009, margins
shall be determined as if Level II were applicable regardless of the Fixed Charge Coverage Ratio for the last Fiscal Quarter. Thereafter, the margins shall be subject to increase or decrease upon receipt by Agent pursuant to
Section 10.1.2 of the financial statements and corresponding Compliance Certificate for the last Fiscal Quarter, which change shall be effective on the first day of the calendar month following receipt. If, by the first day of a month,
any financial statements and Compliance Certificate due in the preceding month have not been received, then, at the option of Agent or Required Lenders, the margins shall be determined as if Level IV were applicable, from such day until the first
day of the calendar month following actual receipt. 
 Approved Fund: any Person (other than a natural person) that is
engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in its ordinary course of activities, and is administered or managed by a Lender, an entity that administers or manages a Lender, or
an Affiliate of either. 
 Asset Disposition: a sale, lease, license, consignment, transfer or other disposition of
Property of an Obligor, including a disposition of Property in connection with a sale-leaseback transaction or synthetic lease, but excluding any (i) damage to, or loss of or destruction, or loss of title to, physical property of any Borrower
or Guarantor, and (ii) taking of any property of any Borrower or Guarantor or any portion thereof, in or by condemnation or other eminent domain proceedings pursuant to any law, general or special, or by reason of the temporary requisition or
use of any property of any Borrower or any Guarantor or any portion thereof by an Governmental Authority. 
 Assignment and
Acceptance: an assignment agreement between a Lender and Eligible Assignee, in the form of Exhibit B. 

Availability: the Borrowing Base minus the principal balance of all Revolver Loans. 

Availability Block: $10,000,000. 
  

 -2- 

 Availability Reserve: the sum (without duplication) of (a) the Inventory
Reserve; (b) the Rent and Charges Reserve; (c) the LC Reserve; (d) the Bank Product Reserve; (e) all accrued Royalties (if any), whether or not then due and payable by a Borrower, arising under any license or agreement under
which a Borrower is authorized to use Intellectual Property in connection with any manufacture, marketing, distribution or disposition of Collateral; (f) the Repurchase Reserve; (g) the Pension Reserve (h) the Availability Block;
(i) the aggregate amount of liabilities secured by Liens upon Collateral that are senior to Agent’s Liens (but imposition of any such reserve shall not waive an Event of Default arising therefrom); (j) the Dilution Reserve; and
(k) such additional reserves, in such amounts and with respect to such matters, as Agent in its Credit Judgment may elect to impose from time to time. 
 Bank of America: Bank of America, N.A., a national banking association, and its successors and assigns. 
 Bank of America-WFF Fee Letter: the fee letter agreement among Bank of America, WFF, and Borrowers. 
 Bank of America Indemnitees: Bank of America and its officers, directors, employees, Affiliates, agents and attorneys. 
 Bank Product: any of the following products, services or facilities extended to any Borrower or Subsidiary by Bank of America, WFF, or any of their respective Affiliates: (a) Cash Management
Services; (b) products under Hedging Agreements; (c) commercial credit card and merchant card services; and (d) leases and other banking products or services as may be requested by any Borrower or Subsidiary, other than Letters of
Credit; provided, however, that for any of the foregoing to be included as an “Obligation” for purposes of a distribution under Section 5.6.1, the applicable Secured Party and Obligor must have previously provided
written notice to Agent of (i) the existence of such Bank Product, (ii) the maximum dollar amount of obligations arising thereunder to be included as a Bank Product Reserve (“Bank Product Amount”), and (iii) the
methodology to be used by such parties in determining the Bank Product Debt owing from time to time. The Bank Product Amount may be changed from time to time upon written notice to Agent by the Secured Party and Obligor. No Bank Product Amount may
be established or increased at any time that a Default or Event of Default exists, or if a reserve in such amount would cause an Overadvance. 
 Bank Product Debt: Debt and other obligations of a Borrower or Guarantor relating to Bank Products. 
 Bank Product Reserve: the aggregate amount of reserves established by Agent from time to time in its discretion in respect of Bank Product Debt, which shall be at least equal to the sum of all Bank
Product Amounts. 
 Bankruptcy Case: with respect to any Borrower or Guarantor, any bankruptcy case (whether for
liquidation or reorganization of such Borrower or Guarantor) under the Bankruptcy Code in which such Borrower or Guarantor is the debtor or any analogous proceeding under the laws of any jurisdiction other than the United States. 

Bankruptcy Code: Title 11 of the United States Code. 
 Bankruptcy Rejection: the entry of an order in a Bankruptcy Case with respect to the owner of any Intellectual Property authorizing the rejection by such owner (or a trustee for such owner or such
owner as debtor in possession) of the IP License or any analogous event in a Bankruptcy Case under the laws of any jurisdiction other than the United States; provided, however, that nothing herein shall be deemed to be an
acknowledgment or agreement by any party hereto that the IP License may be rejected under the Bankruptcy Code or subject to any analogous event in a Bankruptcy Case under the laws of any jurisdiction other than the United States. 

 

 -3- 

 Base Rate: for any day, a per annum rate equal to the greater of (a) the Prime
Rate for such day; (b) the Federal Funds Rate for such day, plus 0.50%; or (c) LIBOR for a 30 day interest period as determined on such day, plus 1.0%. 
 Base Rate Loan: any Loan that bears interest based on the Base Rate. 

Base Rate Revolver Loan: a Revolver Loan that bears interest based on the Base Rate. 

Board of Governors: the Board of Governors of the Federal Reserve System. 

Borrowed Money: with respect to any Borrower or Guarantor, without duplication, its (a) Debt that (i) arises from the
lending of money by any Person to such Borrower or Guarantor, (ii) is evidenced by notes, drafts, bonds, debentures, credit documents or similar instruments, (iii) accrues interest or is a type upon which interest charges are customarily
paid (excluding trade payables owing in the Ordinary Course of Business), or (iv) was issued or assumed as full or partial payment for Property; (b) Capital Leases; (c) reimbursement obligations with respect to letters of credit; and
(d) guaranties of any Debt of the foregoing types owing by another Person. 
 Borrower Agent: as defined in
Section 4.4. 
 Borrowing: a group of Loans of one Type that are made on the same day or are converted into
Loans of one Type on the same day. 
 Borrowing Base: on any date of determination, an amount equal to the lesser of
(a) the aggregate amount of Revolver Commitments, minus the LC Reserve, minus the Availability Block; or (b) the sum of the Accounts Formula Amount, plus the Inventory Formula Amount, minus the Availability
Reserve. 
 Borrowing Base Certificate: a certificate, in form and substance satisfactory to Agent, by which Borrowers
certify calculation of the Borrowing Base. 
 Business Day: any day other than a Saturday, Sunday or other day on which
commercial banks are authorized to close under the laws of, or are in fact closed in, North Carolina and California, and if such day relates to a LIBOR Loan, any such day on which dealings in Dollar deposits are conducted between banks in the London
interbank Eurodollar market. 
 Capital Expenditures: all liabilities incurred, expenditures made or payments due
(whether or not made) by a Borrower or Subsidiary for the acquisition of any fixed assets, or any improvements, replacements, substitutions or additions thereto with a useful life of more than one year, including the principal portion of Capital
Leases; provided that “Capital Expenditures” shall not include expenditures made or payments due with respect to property to the extent (and only to the extent) such expenditures or payments are made from the proceeds of (i) property
insurance used to restore or replace property that has been the subject of a casualty event covered by such insurance, (ii) a disposition of property which is a Permitted Asset Disposition, or (iii) compensation made with respect to any
taking of any property in or by condemnation or other eminent domain proceedings pursuant to any law, general or special, or by reason of the temporary requisition or use of any property. 

Capital Lease: any lease that is required to be capitalized for financial reporting purposes in accordance with GAAP. 

Cash Collateral: cash, and any interest or other income earned thereon, that is delivered to Agent to Cash Collateralize any
Obligations. 
 Cash Collateral Account: a demand deposit, money market or other account established by Agent at such
financial institution as Agent may select in its discretion, which account shall be subject to Agent’s Liens for the benefit of Secured Parties. 
  

 -4- 

 Cash Collateralize: the delivery of cash to Agent, as security for the payment of
Obligations, in an amount equal to (a) with respect to LC Obligations, 105% of the aggregate LC Obligations, and (b) with respect to any inchoate, contingent or other Obligations (including Obligations arising under Bank Products),
Agent’s good faith estimate of the amount due or to become due, including all fees and other amounts relating to such Obligations. “Cash Collateralization” has a correlative meaning. 

Cash Equivalents: (a) marketable obligations issued or unconditionally guaranteed by, and backed by the full faith and credit
of, the United States government, maturing within 12 months of the date of acquisition; (b) certificates of deposit, time deposits and bankers’ acceptances maturing within 12 months of the date of acquisition, and overnight bank deposits,
in each case which are issued by a commercial bank organized under the laws of the United States or any state or district thereof, rated A-1 (or better) by S&P or P-1 (or better) by Moody’s at the time of acquisition, and (unless issued by
a Lender) not subject to offset rights; (c) repurchase obligations with a term of not more than 30 days for underlying investments of the types described in clauses (a) and (b) entered into with any bank meeting the qualifications
specified in clause (b); (d) commercial paper rated A-1 (or better) by S&P or P-1 (or better) by Moody’s, and maturing within nine months of the date of acquisition; and (e) shares of any money market fund that has substantially
all of its assets invested continuously in the types of investments referred to above, has net assets of at least $500,000,000 and has the highest rating obtainable from either Moody’s or S&P. 

Cash Management Services: any services provided from time to time by Bank of America, WFF, or any of their respective Affiliates
to any Borrower or Subsidiary in connection with operating, collections, payroll, trust, or other depository or disbursement accounts, including automated clearinghouse, e-payable, electronic funds transfer, wire transfer, controlled disbursement,
overdraft, depository, information reporting, lockbox and stop payment services. 
 CERCLA: the Comprehensive
Environmental Response Compensation and Liability Act (42 U.S.C. § 9601 et seq.). 
 Change in Law:
the occurrence, after the date hereof, of (a) the adoption or taking effect of any law, rule, regulation or treaty; (b) any change in any law, rule, regulation or treaty or in the administration, interpretation or application thereof by
any Governmental Authority; or (c) the making or issuance of any request, guideline or directive (whether or not having the force of law) by any Governmental Authority. 
 Change of Control: any “person” or “group” (within the meaning of Sections 13(d) and 14(d) of the Securities Exchange Act of 1934) becomes the “beneficial owner” (as
defined in Rule 13d-3 under the Securities Exchange Act of 1934), directly or indirectly, of 35%, or more, of the Equity Interests of Clearwater having the right to vote for the election of members of the board of directors of Clearwater.

 Claims: all liabilities, obligations, losses, damages, penalties, judgments, proceedings, interest, costs and expenses
of any kind (including remedial response costs, reasonable attorneys’ fees and Extraordinary Expenses) at any time (including after Full Payment of the Obligations, resignation or replacement of Agent, or replacement of any Lender) incurred by
or asserted against any Indemnitee in any way relating to (a) any Loans, Letters of Credit, Loan Documents, or the use thereof or transactions relating thereto, (b) any action taken or omitted to be taken by any Indemnitee in connection
with any Loan Documents, (c) the existence or perfection of any Liens, or realization upon any Collateral, (d) exercise of any rights or remedies under any Loan Documents or Applicable Law, or (e) failure by any Obligor to perform or
observe any terms of any Loan Document, in each case including all costs and expenses relating to any investigation, litigation, arbitration or other proceeding (including an Insolvency Proceeding or appellate proceedings), whether or not the
applicable Indemnitee is a party thereto. 
  

 -5- 

 Closing Date: as defined in Section 6.1. 

Code: the Internal Revenue Code of 1986. 
 Collateral: all Property described in Section 7.1, all Property described in any Security Documents as security for any Obligations, and all other Property that now or hereafter secures
(or is intended to secure) any Obligations. 
 Collateral Related Intellectual Property: Intellectual Property used in
connection with any manufacture, marketing, distribution or disposition of Collateral. 
 Commitment: for any Lender, the
aggregate amount of such Lender’s Revolver Commitment. “Commitments” means the aggregate amount of all Revolver Commitments. 
 Commitment Termination Date: the earliest to occur of (a) the Revolver Termination Date; (b) the date on which Borrowers terminate the Revolver Commitments pursuant to
Section 2.1.4; or (c) the date on which the Revolver Commitments are terminated pursuant to Section 11.2. 
 Compliance Certificate: a certificate, in form and substance satisfactory to Agent, by which Borrowers certify compliance with Sections 10.2.3 and 10.3 and calculate the applicable
“Level” for the Applicable Margin (as set forth in the definition thereof). 
 Contingent Obligation: any
obligation of a Person arising from a guaranty, indemnity or other assurance of payment or performance of any Debt, lease, dividend or other obligation (“primary obligations”) of another obligor (“primary obligor”)
in any manner, whether directly or indirectly, including any obligation of such Person under any (a) guaranty, endorsement, co-making or sale with recourse of an obligation of a primary obligor; (b) obligation to make take-or-pay or
similar payments regardless of nonperformance by any other party to an agreement; and (c) arrangement (i) to purchase any primary obligation or security therefor, (ii) to supply funds for the purchase or payment of any primary
obligation, (iii) to maintain or assure working capital, equity capital, net worth or solvency of the primary obligor, (iv) to purchase Property or services for the purpose of assuring the ability of the primary obligor to perform a
primary obligation, or (v) otherwise to assure or hold harmless the holder of any primary obligation against loss in respect thereof. The amount of any Contingent Obligation shall be deemed to be the stated or determinable amount of the primary
obligation (or, if less, the maximum amount for which such Person may be liable under the instrument evidencing the Contingent Obligation) or, if not stated or determinable, the maximum reasonably anticipated liability with respect thereto.

 Credit Judgment: Agent’s judgment exercised in good faith, based upon its consideration of any factor that it
believes (a) could adversely affect the quantity, quality, mix or value of Collateral (including any Applicable Law that may inhibit collection of an Account), the enforceability or priority of Agent’s Liens, or the amount that Agent and
Lenders could receive in liquidation of any Collateral; (b) suggests that any collateral report or financial information delivered by any Obligor is incomplete, inaccurate or misleading in any material respect; (c) materially increases the
likelihood of any Insolvency Proceeding involving an Obligor; or (d) creates or could result in a Default or Event of Default. In exercising such judgment, Agent may consider any factors that could increase the credit risk of lending to
Borrowers on the security of the Collateral. 
 CWA: the Clean Water Act (33 U.S.C. §§ 1251 et
seq.). 
 Debt: as applied to any Person, without duplication, (a) all items that would be included as
liabilities on a balance sheet in accordance with GAAP, including Capital Leases, but excluding trade payables incurred and being paid in the Ordinary Course of Business; (b) all Contingent Obligations; (c) all reimbursement obligations in
connection with letters of credit issued for the account of such Person; and (d) in the case of a Borrower, the Obligations. The Debt of a Person shall include any recourse Debt of any partnership in which such Person is a general partner or
joint venturer. 
  

 -6- 

 Default: an event or condition that, with the lapse of time or giving of notice,
would constitute an Event of Default. 
 Default Rate: for any Obligation (including, to the extent permitted by law,
interest not paid when due), 2% plus the interest rate otherwise applicable thereto. 
 Defaulting Lender: any Lender
that (a) fails to make any payment or provide funds to Agent or any Borrower as required hereunder or fails otherwise to perform its obligations under any Loan Document, and such failure is not cured within one Business Day, or (b) is the
subject of any Insolvency Proceeding. 
 Deposit Account: as defined in the UCC, excluding the Potlatch Escrow Account.

 Deposit Account Control Agreements: the Deposit Account control agreements to be executed by each institution
maintaining a Deposit Account for a Borrower, in favor of Agent, for the benefit of Secured Parties, as security for the Obligations. 
 Dilution Percent: the percent, determined for Borrowers’ most recent trailing twelve month period, equal to (a) bad debt write-downs or write-offs, discounts, returns, promotions,
credits, credit memos and other dilutive items with respect to Accounts, divided by (b) gross sales. 

Dilution Reserve: as of any date of determination, an amount sufficient to reduce the advance rate against Eligible Accounts by
one (1) percentage point for each one-half of one (0.50) percentage point by which the Dilution Percent is in excess of 7.5%. 
 Distribution: any declaration or payment of a distribution, interest or dividend on any Equity Interest (other than payment-in-kind); any distribution, advance or repayment of Debt to a holder of
Equity Interests; or any purchase, redemption, or other acquisition or retirement for value of any Equity Interest. 

Dollars: lawful money of the United States. 
 Dominion Account: a special account established by Borrowers at Bank of America or another bank acceptable to Agent, over which Agent has exclusive control for withdrawal purposes during each
Trigger Period. 
 EBITDA: with respect to any period, determined on a consolidated basis for Borrowers and Subsidiaries,
net income for such period, calculated before interest expense, provision for income taxes, depreciation and amortization expense, any non-cash items relating to stock based employee compensation or equity or stock option plans, gains or losses
arising from the sale of capital assets, gains arising from the write-up of assets, and any extraordinary gains (in each case, to the extent included in determining net income for such period). 

Eligible Account: an Account owing to a Borrower that arises in the Ordinary Course of Business from the sale of goods or
rendition of services, is payable in Dollars and is deemed by Agent, in its Credit Judgment, to be an Eligible Account. Without limiting the foregoing, no Account shall be an Eligible Account if (a) it is unpaid for more than 60 days after the
original due date, or more than 90 days after the original invoice date; (b) 50% or more of the Accounts owing by the Account Debtor are not Eligible Accounts under the foregoing clause; (c) when aggregated with other Accounts owing by the
Account Debtor, it exceeds 15% of the aggregate Eligible Accounts (or such higher percentage as Required Lenders may establish for the Account Debtor from time to time); (d) it does not conform with a covenant

  

 -7- 

 
or representation herein; (e) it is owing by a creditor or supplier, or is otherwise subject to a potential offset, counterclaim, dispute, deduction, discount (other than an early pay
discount offered as part of the normal course selling terms), recoupment, reserve, defense, chargeback, credit or allowance (but ineligibility shall be limited to the amount thereof); (f) an Insolvency Proceeding has been commenced by or
against the Account Debtor; or the Account Debtor has failed, has suspended or ceased doing business, is liquidating, dissolving or winding up its affairs, or is not Solvent; or the Borrower is not able to bring suit or enforce remedies against the
Account Debtor through judicial process; (g) the Account Debtor is organized or has its principal offices or assets outside the United States or Canada unless (i) such Account is supported by an irrevocable letter of credit satisfactory to
Agent (as to form, substance, and issuer or domestic confirming bank); and (ii) upon Agent’s request to Borrower Agent after a Default or an Event of Default, such letter of credit has been delivered to Agent and is directly drawable by
Agent; provided, however, that up to $3,750,000 of such Accounts shall not be excluded under this clause (g); (h) it is owing by a Government Authority, unless the Account Debtor is the United States or any State, department,
agency or instrumentality thereof and the Assignment of Claims Act or any similar State or local law, if applicable, has been complied with in a manner satisfactory to Agent; (i) it is not subject to a duly perfected, first priority Lien in
favor of Agent, or is subject to any other Lien; (j) the goods giving rise to it have not been delivered to and accepted by the Account Debtor, the services giving rise to it have not been accepted by the Account Debtor, or it otherwise does
not represent a final sale; (k) it is evidenced by Chattel Paper or an Instrument of any kind, or has been reduced to judgment; (l) the Account Debtor has made a partial payment and Agent believes in its Credit Judgment that its collection
is doubtful; (m) it arises from a sale on a cash-on-delivery basis; (n) it arises from a sale to an Affiliate, from a sale on a bill-and-hold, guaranteed sale, sale-or-return, sale-on-approval, consignment, or other repurchase or return
basis, or from a sale to a Person for personal, family or household purposes; (o) it represents a progress billing or retainage; or (p) it includes a billing for interest, fees or late charges, but ineligibility shall be limited to the
extent thereof. In calculating delinquent portions of Accounts under clauses (a) and (b), credit balances more than 90 days old will be excluded. 
 Eligible Assignee: a Person that is (a) a Lender, U.S.-based Affiliate of a Lender or Approved Fund; (b) any other financial institution approved by Agent and Borrower Agent (which
approval by Borrower Agent shall not be unreasonably withheld or delayed, and shall be deemed given if no objection is made within five Business Days after notice of the proposed assignment), that is organized under the laws of the United States or
any state or district thereof, has total assets in excess of $5 billion, extends asset-based lending facilities in its ordinary course of business and whose becoming an assignee would not constitute a prohibited transaction under Section 4975
of the Code or any other Applicable Law; and (c) during any Event of Default, any Person acceptable to Agent in its discretion. 
 Eligible Inventory: Inventory owned by a Borrower that Agent, in its Credit Judgment, deems to be Eligible Inventory. Without limiting the foregoing, no Inventory shall be Eligible Inventory unless
it (a) is finished goods or raw materials, and not work-in-process, packaging or shipping materials, labels, samples, display items, bags, replacement parts or manufacturing supplies; (b) is not held on consignment, nor subject to any
deposit or downpayment; (c) is in new and saleable condition and is not damaged, defective, shopworn or otherwise unfit for sale; (d) is not slow-moving, obsolete or unmerchantable, and does not constitute returned or repossessed goods;
(e) meets all standards imposed by any Governmental Authority, and does not constitute hazardous materials under any Environmental Law; (f) conforms with the covenants and representations herein; (g) is subject to Agent’s duly
perfected, first priority Lien, and no other Lien; (h) is within the continental United States or Canada, is not in transit except between locations of Borrowers, and is not consigned to any Person; (i) is not subject to any warehouse
receipt or negotiable Document, unless Agent shall have received a Lien Waiver from the Person who has possession of the Inventory subject to such warehouse receipt or negotiable Document; (j) is not subject to any License or other arrangement
that restricts such Borrower’s or Agent’s right to dispose of such Inventory, unless Agent has received an appropriate Lien Waiver; (k) is not located on leased premises or in the possession of a warehouseman, processor, repairman,
mechanic, shipper, freight forwarder or other Person, unless the lessor or such Person has delivered a Lien Waiver or an appropriate 

 

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Rent and Charges Reserve has been established; (l) is located at a location where the Value of all Inventory at such location exceeds $100,000; (m) does not consist of parent rolls or
rough lumber; (n) does not consist of chemicals, fuel oil, polyethylene, hog fuel, and other similar Inventory as determined by Agent in its Credit Judgment; (o) is not located at a customer of any Borrower; and (p) is reflected in
the details of a current perpetual inventory report. 
 Eligible Semi-Finished Inventory: Inventory of Borrowers which
does not qualify as Eligible Inventory solely because it is excluded under clause (m) of the definition of “Eligible Inventory”. 
 Enforcement Action: any action to enforce any Obligations or Loan Documents or to realize upon any Collateral (whether by judicial action, self-help, notification of Account Debtors, exercise of
setoff or recoupment, or otherwise). 
 Environmental Laws: all Applicable Laws (including all programs, permits and
guidance promulgated by regulatory agencies), relating to public health (but excluding occupational safety and health, to the extent regulated by OSHA) or the protection or pollution of the environment, including CERCLA, RCRA and CWA. 

Environmental Notice: a written notice from any Governmental Authority of any possible noncompliance with, investigation of a
possible violation of, litigation relating to, or potential fine or liability under any Environmental Law, or with respect to any Environmental Release, environmental pollution or hazardous materials, including any complaint, summons, citation,
order, claim, demand or request for correction, remediation or otherwise. 
 Environmental Release: a release as defined
in CERCLA or under any other Environmental Law. 
 Equity Interest: the interest of any (a) shareholder in a
corporation; (b) partner in a partnership (whether general, limited, limited liability or joint venture); (c) member in a limited liability company; or (d) other Person having any other form of equity security or ownership interest.

 ERISA: the Employee Retirement Income Security Act of 1974. 

ERISA Affiliate: any trade or business (whether or not incorporated) under common control with an Obligor within the meaning of
Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for purposes of provisions relating to Section 412 of the Code). 
 ERISA Event: (a) a Reportable Event with respect to a Pension Plan; (b) a withdrawal by any Obligor or ERISA Affiliate from a Pension Plan subject to Section 4063 of ERISA during a
plan year in which it was a substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation of operations that is treated as such a withdrawal under Section 4062(e) of ERISA; (c) a complete or partial withdrawal by any
Obligor or ERISA Affiliate from a Multiemployer Plan or notification to the Multiemployer Plan that such plan is in reorganization; (d) the filing of a notice of intent to terminate, the treatment of a Plan amendment as a termination under
Section 4041 or 4041A of ERISA, or the commencement of proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan; (e) any Obligor or ERISA Affiliate fails to meet any minimum funding obligations with respect to any Pension
Plan or Multiemployer Plan, or requests a minimum funding waiver; (f) an event or condition which constitutes grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan or
Multiemployer Plan; or (g) the imposition of any liability under Title IV of ERISA, other than for PBGC premiums due but not delinquent under Section 4007 of ERISA, upon any Obligor or ERISA Affiliate. 

Event of Default: as defined in Section 11. 

 

 -9- 

 Excluded Tax: with respect to Agent, any Lender, Issuing Bank or any other recipient
of a payment to be made by or on account of any Obligation, (a) Taxes imposed on or measured by its overall net income (however denominated), and franchise taxes imposed on it (in lieu of net income taxes), by the jurisdiction (or any political
subdivision thereof) under the laws of which such recipient is organized or in which its principal office is located or, in the case of any Lender, in which its applicable Lending Office is located; (b) any branch profits taxes imposed by the
United States or any similar tax imposed by any other jurisdiction in which Borrower Agent is located; (c) any backup withholding tax required by the Code to be withheld from amounts payable to a Lender that has failed to comply with
Section 5.10; and (d) in the case of a Foreign Lender, any United States withholding tax that is (i) required pursuant to laws in force at the time such Lender becomes a Lender (or designates a new Lending Office) hereunder, or
(ii) attributable to such Lender’s failure or inability (other than as a result of a Change in Law) to comply with Section 5.10, except to the extent that such Foreign Lender (or its assignor, if any) was entitled, at the time
of designation of a new Lending Office (or assignment), to receive additional amounts from Borrowers with respect to such withholding tax. 
 Extraordinary Expenses: all costs, expenses or advances that Agent may incur during a Default or Event of Default, or during the pendency of an Insolvency Proceeding of a Borrower or a Guarantor,
including those relating to (a) any audit, inspection, repossession, storage, repair, appraisal, insurance, manufacture, preparation or advertising for sale, sale, collection, or other preservation of or realization upon any Collateral;
(b) any action, arbitration or other proceeding (whether instituted by or against Agent, any Lender, any Obligor, any representative of creditors of an Obligor or any other Person) in any way relating to any Collateral (including the validity,
perfection, priority or avoidability of Agent’s Liens with respect to any Collateral), Loan Documents, Letters of Credit or Obligations, including any lender liability or other Claims; (c) the exercise, protection or enforcement of any
rights or remedies of Agent in, or the monitoring of, any Insolvency Proceeding; (d) settlement or satisfaction of any taxes, charges or Liens with respect to any Collateral; (e) any Enforcement Action; (f) negotiation and
documentation of any modification, waiver, workout, restructuring or forbearance with respect to any Loan Documents or Obligations; and (g) Protective Advances. Such costs, expenses and advances include transfer fees, Other Taxes, storage fees,
insurance costs, permit fees, utility reservation and standby fees, legal fees, appraisal fees, brokers’ fees and commissions, auctioneers’ fees and commissions, accountants’ fees, environmental study fees, wages and salaries paid to
employees of any Obligor or independent contractors in liquidating any Collateral, and travel expenses. 

Federal Funds Rate: (a) the weighted average of interest rates on overnight federal funds transactions
with members of the Federal Reserve System arranged by federal funds brokers on the applicable Business Day (or on the preceding Business Day, if the applicable day is not a Business Day), as published by the Federal Reserve Bank of New York on the
next Business Day; or (b) if no such rate is published on the next Business Day, the average rate (rounded up, if necessary, to the nearest  1/8 of 1%) charged to Bank of America on the applicable day on such transactions, as determined by Agent. 

Fee Letters: collectively, the Agent Fee Letter and the Bank of America-WFF Fee Letter. 

Fiscal Quarter: each period of three months, commencing on the first day of a Fiscal Year. 

Fiscal Year: the fiscal year of Borrowers and Subsidiaries for accounting and tax purposes, ending on December 31 of each
year. 
 Fixed Charge Coverage Ratio: with respect to any period, the ratio, determined on a consolidated basis for
Borrowers and Subsidiaries, of (a) EBITDA for such period to (b) Fixed Charges for such period. 
 Fixed
Charges: the sum of interest expense (other than payment-in-kind), principal payments made on Borrowed Money (other than: (i) repayments of the Revolver Loans; and (ii) repayments of the Potlatch Indebtedness to the extent permitted
under Section 10.2.8(c)), cash taxes paid, Capital Expenditures (except those financed with Borrowed Money other than Revolver Loans), and Distributions made. 

 

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 FLSA: the Fair Labor Standards Act of 1938. 

Foreign Lender: any Lender that is organized under the laws of a jurisdiction other than the laws of the United States, or any
state or district thereof. 
 Foreign Plan: any employee benefit plan or arrangement (a) maintained or contributed
to by any Obligor or Subsidiary that is not subject to the laws of the United States; or (b) mandated by a government other than the United States for employees of any Obligor or Subsidiary. 

Foreign Subsidiary: a Subsidiary that is a “controlled foreign corporation” under Section 957 of the Code, such
that a guaranty by such Subsidiary of the Obligations or a Lien on the assets of such Subsidiary to secure the Obligations would result in material tax liability to Borrowers. 
 Full Payment: with respect to any Obligations, (a) the full and indefeasible cash payment thereof, including any interest, fees and other charges accruing during an Insolvency Proceeding
(whether or not allowed in the proceeding); and (b) if such Obligations are LC Obligations or inchoate or contingent in nature, Cash Collateralization thereof (or delivery of a standby letter of credit acceptable to Agent in its discretion, in
the amount of required Cash Collateral). No Loans shall be deemed to have been paid in full until all Commitments related to such Loans have expired or been terminated. 
 GAAP: generally accepted accounting principles in effect in the United States from time to time. 
 Governmental Approvals: all authorizations, consents, approvals, licenses and exemptions of, registrations and filings with, and required reports to, all Governmental Authorities. 

Governmental Authority: any federal, state, municipal, foreign or other governmental department, agency, commission, board,
bureau, court, tribunal, instrumentality, political subdivision, or other entity or officer exercising executive, legislative, judicial, regulatory or administrative functions for or pertaining to any government or court, in each case whether
associated with the United States, a state, district or territory thereof, or a foreign entity or government. 
 Guarantor
Payment: as defined in Section 5.11.3. 
 Guarantors: Each Person who guarantees payment or performance
of any Obligations. 
 Guaranty: each guaranty agreement executed by a Guarantor in favor of Agent. 

Hedging Agreement: an agreement relating to any swap, cap, floor, collar, option, forward, cross right or obligation, or
combination thereof or similar transaction, with respect to interest rate, foreign exchange, currency, commodity, credit or equity risk. 
 Indemnified Taxes: Taxes other than Excluded Taxes. 
 Indemnitees:
Agent Indemnitees, Lender Indemnitees, Issuing Bank Indemnitees and Bank of America Indemnitees. 
 Insolvency
Proceeding: any case or proceeding commenced by or against a Person under any state, federal or foreign law for, or any agreement of such Person to, (a) the entry of an order for relief under the Bankruptcy Code, or any other insolvency,
debtor relief or debt adjustment law; (b) the appointment of a receiver, trustee, liquidator, administrator, conservator or other custodian for such Person or any part of its Property; or (c) an assignment or trust mortgage for the benefit
of creditors. 
  

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 Intellectual Property: all intellectual and similar Property of a Person, including
inventions, designs, patents, copyrights, trademarks, service marks, trade names, trade secrets, confidential or proprietary information, customer lists, know-how, software and databases; all embodiments or fixations thereof and all related
documentation, applications, registrations and franchises; all licenses or other rights to use any of the foregoing; and all books and records relating to the foregoing. 
 Intellectual Property Claim: any claim or assertion (whether in writing, by suit or otherwise) that a Borrower’s or Subsidiary’s ownership, use, marketing, sale or distribution of any
Inventory, Equipment, Intellectual Property or other Property violates another Person’s Intellectual Property. 

Interest Period: as defined in Section 3.1.3. 

Intercreditor Agreement: the Intercreditor Agreement dated on or about the date hereof, by and between Potlatch and
Agent. 
 Interest Rate Contract: any interest rate swap, collar or cap agreement, or other agreement or
arrangement by any Borrower or Subsidiary with Bank of America that is designed to protect against fluctuations in interest rates. 
 Inventory: as defined in the UCC, including all goods intended for sale, lease, display or demonstration; all work in process; and all raw materials, and other materials and supplies of any kind
that are or could be used in connection with the manufacture, printing, packing, shipping, advertising, sale, lease or furnishing of such goods, or otherwise used or consumed in a Borrower’s business (but excluding Equipment). 

Inventory Formula Amount: the lesser of: 
  

	 	(a)	the sum of: 

  

	 	(i)	the lesser of: (A) 50% of the Value of Eligible Inventory consisting of raw materials; or (B) 85% of the NOLV Percentage of the Value of Eligible Inventory
consisting of raw materials; plus 

  

	 	(ii)	the lesser of: (A) 50% of the Value of Eligible Semi-Finished Inventory; or (B) 85% of the NOLV Percentage of the Value of Eligible Semi-Finished Inventory;
plus 

  

	 	(iii)	the lesser of: (A) 65% of the Value of Eligible Inventory consisting of finished goods relating to the Borrowers’ pulp and paperboard business; or
(B) 85% of the NOLV Percentage of the Value of Eligible Inventory consisting of finished goods relating to the Borrowers’ pulp and paperboard business; plus 

 

	 	(iii)	the lesser of: (A) 65% of the Value of Eligible Inventory consisting of finished goods relating to the Borrowers’ wood product business; or (B) 85% of
the NOLV Percentage of the Value of Eligible Inventory consisting of finished goods relating to the Borrowers’ wood product business; plus 

  

	 	(iv)	the lesser of: (A) 70% of the Value of Eligible Inventory consisting of finished goods relating to the Borrowers’ consumer tissue products business; or
(B) 85% of the NOLV Percentage of the Value of Eligible Inventory consisting of finished goods relating to the Borrowers’ consumer tissue products business; or 

  

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	 	(b)	an amount equal to 150% of the Accounts Formula Amount. 

 Inventory Reserve: reserves established by Agent in its Credit Judgment to reflect factors that may negatively impact the Value of Inventory, including change in salability, obsolescence,
seasonality, theft, shrinkage, imbalance, change in composition or mix, markdowns and vendor chargebacks. 
 Investment:
any acquisition of all or substantially all assets of a Person; any acquisition of record or beneficial ownership of any Equity Interests of a Person; or any advance or capital contribution to or other investment in a Person. 

IP License: as defined in Section 11.3. 
 IRS: the United States Internal Revenue Service. 
 Issuing Bank:
Bank of America or an Affiliate of Bank of America. 
 Issuing Bank Indemnitees: Issuing Bank and its officers,
directors, employees, Affiliates, agents and attorneys. 
 LC Application: an application by Borrower Agent to Issuing
Bank for issuance of a Letter of Credit, in the form used by Issuing Bank. 
 LC Conditions: the following conditions
necessary for issuance of a Letter of Credit: (a) each of the conditions set forth in Section 6; (b) after giving effect to such issuance, total LC Obligations do not exceed the Letter of Credit Subline, no Overadvance exists
and, if no Revolver Loans are outstanding, the LC Obligations do not exceed the Borrowing Base (without giving effect to the LC Reserve for purposes of this calculation); (c) the expiration date of such Letter of Credit is (i) no more than
365 days from issuance, in the case of standby Letters of Credit, (ii) no more than 120 days from issuance, in the case of documentary Letters of Credit, and (iii) at least 20 Business Days prior to the Revolver Termination Date;
(d) the Letter of Credit and payments thereunder are denominated in Dollars; and (e) the purpose and form of the proposed Letter of Credit is satisfactory to Agent and Issuing Bank in their discretion. 

LC Documents: all documents, instruments and agreements (including LC Requests and LC Applications) delivered by Borrowers or any
other Person to Issuing Bank or Agent in connection with issuance, amendment or renewal of, or payment under, any Letter of Credit. 
 LC Obligations: the sum (without duplication) of (a) all amounts owing by Borrowers for any drawings under Letters of Credit; (b) the stated amount of all outstanding Letters of Credit;
and (c) all fees and other amounts owing with respect to Letters of Credit. 
 LC Request: a request for issuance of
a Letter of Credit, to be provided by Borrower Agent to Issuing Bank, in form satisfactory to Agent and Issuing Bank. 
 LC
Reserve: the aggregate of all LC Obligations, other than (a) those that have been Cash Collateralized; and (b) if no Default or Event of Default exists, those constituting fees and other amounts owing to the Issuing Bank. 

Lender Indemnitees: Lenders and their officers, directors, employees, Affiliates, agents and attorneys. 

Lenders: as defined in the preamble to this Agreement, including Agent in its capacity as a provider of Swingline Loans and any
other Person who hereafter becomes a “Lender” pursuant to an Assignment and Acceptance. 
  

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 Lending Office: the office designated as such by the applicable Lender at the time it
becomes party to this Agreement or thereafter by notice to Agent and Borrower Agent. 
 Letter of Credit: any standby or
documentary letter of credit issued by Issuing Bank for the account of a Borrower, or any indemnity, guarantee, exposure transmittal memorandum or similar form of credit support issued by Agent or Issuing Bank for the benefit of a Borrower.

 Letter of Credit Subline: $20,000,000. 

LIBOR: for any Interest Period with respect to a LIBOR Loan, the per annum rate of interest (rounded upward,
if necessary, to the nearest  1/32th of 1%),
determined by Agent at approximately 11:00 a.m. (London time) two Business Days prior to commencement of such Interest Period, for a term comparable to such Interest Period, equal to (a) the British Bankers Association LIBOR Rate (“BBA
LIBOR”), as published by Reuters (or other commercially available source designated by Agent); or (b) if BBA LIBOR is not available for any reason, the interest rate at which Dollar deposits in the approximate amount of the LIBOR Loan
would be offered by Bank of America’s London branch to major banks in the London interbank Eurodollar market. If the Board of Governors imposes a Reserve Percentage with respect to LIBOR deposits, then LIBOR shall be the foregoing rate, divided
by 1 minus the Reserve Percentage. 
 LIBOR Loan: each set of LIBOR Revolver Loans having a common length and
commencement of Interest Period. 
 LIBOR Revolver Loan: a Revolver Loan that bears interest based on LIBOR. 

License: any license or agreement under which an Obligor is authorized to use Intellectual Property in connection with any
manufacture, marketing, distribution or disposition of Collateral, any use of Property or any other conduct of its business. 

License Rejection Liabilities: all damages of Agent or any Lender (a) arising from the diminution of value of the Inventory
of any Borrower in connection with any disposition thereof, or (ii) as determined by a court of competent jurisdiction, in each case, resulting from any Bankruptcy Rejection of the IP License. 

Licensor: any Person from whom an Obligor obtains the right to use any Intellectual Property. 

Lien: any Person’s interest in Property securing an obligation owed to, or a claim by, such Person, whether such interest is
based on common law, statute or contract, including liens, security interests, pledges, hypothecations, statutory trusts, reservations, exceptions, encroachments, easements, rights-of-way, covenants, conditions, restrictions, leases, and other title
exceptions and encumbrances affecting Property. 
 Lien Waiver: an agreement, in form and substance satisfactory to
Agent, by which (a) for any Collateral located on leased premises, the lessor waives or subordinates any Lien it may have on the Collateral, and agrees to permit Agent to enter upon the premises and remove the Collateral or to use the premises
to store or dispose of the Collateral; (b) for any Collateral held by a warehouseman, processor, shipper, customs broker or freight forwarder, such Person waives or subordinates any Lien it may have on the Collateral, agrees to hold any
Documents in its possession relating to the Collateral as agent for Agent, and agrees to deliver the Collateral to Agent upon request; (c) for any Collateral held by a repairman, mechanic or bailee, such Person acknowledges Agent’s Lien,
waives or subordinates any Lien it may have on the Collateral, and agrees to deliver the Collateral to Agent upon request; and (d) for any Collateral subject to a Licensor’s Intellectual Property rights, the Licensor grants to Agent the
right, vis-à-vis such Licensor, to enforce Agent’s Liens with respect to the Collateral, including the right to dispose of it with the benefit of the Intellectual Property, whether or not a default exists under any applicable License.

  

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 Line Usage: for any period, the percent equal to (a) the average daily amount of
outstanding Obligations for such period divided by (b) the average amount of Revolver Commitments (minus the Availability Block) during such period. 
 Loan: a Revolver Loan. 
 Loan Account: the loan account established
by each Lender on its books pursuant to Section 5.8. 
 Loan Documents: this Agreement, Other Agreements and
Security Documents. 
 Loan Year: each 12 month period commencing on the Closing Date and on each anniversary of the
Closing Date. 
 Margin Stock: as defined in Regulation U of the Board of Governors. 

Material Adverse Effect: the effect of any event or circumstance that (a) has or could be reasonably expected to have a
material adverse effect on the business, operations, Properties or condition (financial or otherwise) of any Obligor, on the value of any material Collateral, on the enforceability of any Loan Documents, or on the validity or priority of
Agent’s Liens on any Collateral; (b) impairs the ability of any Borrower or Guarantor to perform any obligations under the Loan Documents, including repayment of any Obligations; or (c) otherwise impairs the ability of Agent or any
Lender to enforce or collect any Obligations or to realize upon any Collateral. 
 Material Contract: any agreement or
arrangement to which a Borrower or Subsidiary is party (other than the Loan Documents) (a) that is deemed to be a material contract under any securities law applicable to such Obligor, including the Securities Act of 1933; (b) for which
breach, termination, nonperformance or failure to renew could reasonably be expected to have a Material Adverse Effect; or (c) that relates to Subordinated Debt, or Debt in an aggregate amount of $5,000,000 or more. 

Modified Availability: on any date of determination, an amount equal to the sum of (a) Availability, plus (b) the
lesser of (i) Suppressed Availability; or (ii) $25,000,000. 
 Moody’s: Moody’s Investors Service,
Inc., and its successors. 
 Multiemployer Plan: any employee benefit plan of the type described in
Section 4001(a)(3) of ERISA, to which any Obligor or ERISA Affiliate makes or is obligated to make contributions, or during the preceding five plan years, has made or been obligated to make contributions. 

Net Proceeds: with respect to an Asset Disposition, proceeds (including, when received, any deferred or escrowed payments)
received by a Borrower or Subsidiary in cash from such disposition, net of (a) reasonable and customary costs and expenses actually incurred in connection therewith, including legal fees and sales commissions; (b) amounts applied to
repayment of Debt secured by a Permitted Lien senior to Agent’s Liens on Collateral sold; (c) any Taxes reasonably attributable to such Asset Disposition (including any withholding in respect of such Taxes) and reasonably estimated by
Clearwater to be actually payable; and (d) reserves for indemnities, until such reserves are no longer needed. 
 NOLV
Percentage: with respect to any category of Inventory, the net orderly liquidation value of such Inventory, expressed as a percentage, expected to be realized at an orderly, negotiated sale held within a reasonable period of time, net of all
liquidation expenses, as determined from the most recent appraisal of Borrowers’ Inventory performed by an appraiser and on terms satisfactory to Agent. 
  

 -15- 

 Notes: each Revolver Note or other promissory note executed by a Borrower to evidence
any Obligations. 
 Notice of Borrowing: a Notice of Borrowing to be provided by Borrower Agent to request a Borrowing of
Revolver Loans, in form satisfactory to Agent. 
 Notice of Conversion/Continuation: a Notice of Conversion/Continuation
to be provided by Borrower Agent to request a conversion or continuation of any Loans as LIBOR Loans, in form satisfactory to Agent. 
 Obligations: all (a) principal of and premium, if any, on the Loans, (b) LC Obligations and other obligations of Obligors with respect to Letters of Credit, (c) interest, expenses,
fees and other sums payable by Obligors under Loan Documents, (d) obligations of Obligors under any indemnity for Claims, (e) Extraordinary Expenses, (f) Bank Product Debt, and (g) other Debts, obligations and liabilities of any
kind owing by Obligors pursuant to the Loan Documents, whether now existing or hereafter arising, whether evidenced by a note or other writing, whether allowed in any Insolvency Proceeding, whether arising from an extension of credit, issuance of a
letter of credit, acceptance, loan, guaranty, indemnification or otherwise, and whether direct or indirect, absolute or contingent, due or to become due, primary or secondary, or joint or several. 

Obligor: each Borrower, Guarantor, or other Person that is liable for payment of any Obligations or that has granted a Lien in
favor of Agent on its assets to secure any Obligations. 
 Ordinary Course of Business: the ordinary course of business
of any Borrower or Subsidiary, consistent with past practices and undertaken in good faith. 
 Organic Documents: with
respect to any Person, its charter, certificate or articles of incorporation, bylaws, articles of organization, limited liability agreement, operating agreement, members agreement, shareholders agreement, partnership agreement, certificate of
partnership, certificate of formation, voting trust agreement, or similar agreement or instrument governing the formation or management of such Person. 
 OSHA: the Occupational Safety and Hazard Act of 1970. 
 Other
Agreement: each Note; LC Document; the Intercreditor Agreement; each Fee Letter; Lien Waiver; Borrowing Base Certificate, Compliance Certificate, financial statement or report delivered hereunder; or other document, instrument or agreement
(other than this Agreement or a Security Document) now or hereafter delivered by an Obligor or other Person to Agent or a Lender in connection with any transactions relating hereto. 

Other Taxes: all present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies
arising from any payment made under any Loan Document or from the execution, delivery or enforcement of, or otherwise with respect to, any Loan Document. 
 Overadvance: as defined in Section 2.1.5. 
 Overadvance
Loan: a Base Rate Revolver Loan made when an Overadvance exists or is caused by the funding thereof. 
 Participant:
as defined in Section 13.2. 
 Patriot Act: the Uniting and Strengthening America by Providing Appropriate
Tools Required to Intercept and Obstruct Terrorism Act of 2001, Pub. L. No. 107-56, 115 Stat. 272 (2001). 
  

 -16- 

 Payment Item: each check, draft or other item of payment payable to a Borrower,
including those constituting proceeds of any Collateral. 
 PBGC: the Pension Benefit Guaranty Corporation. 

Pension Plan: any employee pension benefit plan (as such term is defined in Section 3(2) of ERISA), other than a
Multiemployer Plan, that is subject to Title IV of ERISA and is sponsored or maintained by any Obligor or ERISA Affiliate or to which the Obligor or ERISA Affiliate contributes or has an obligation to contribute, or in the case of a multiple
employer or other plan described in Section 4064(a) of ERISA, has made contributions at any time during the preceding five plan years. 
 Pension Reserve: a reserve in an initial amount equal to $0, and increased on the first day of any month when Availability is less than $25,000,000 as of such day by an amount equal to
 1/12th of the aggregate unpaid required contributions of Borrowers to all
Pension Plans and Multiemployer Plans as of such day; provided, however, that the Pension Reserve shall be decreased from time to time such that the Pension Reserve does not exceed the aggregate unpaid required contributions of
Borrowers to all Pension Plans and Multiemployer Plans. 
 Permitted Acquisition: any Acquisition by any Borrower
in a transaction that satisfies each of the following requirements: (a) such Acquisition is not a hostile acquisition or contested by the Person to be acquired; (b) the assets being acquired (other than a de minimis amount of assets
in relation to Borrower’s and its Subsidiaries’ total assets), or the Person whose Equity Interests are being acquired, are useful in or engaged in, as applicable, the business of Borrower and its Subsidiaries or a business reasonably
related thereto; (c) both before and after giving effect to such Acquisition, each of the representations and warranties in the Loan Documents is true and correct; (d) no Default or Event of Default shall have occurred and be continuing or
would result from the consummation of such Acquisition; (e) as soon as available, but not less than 30 days prior to such Acquisition, the Borrowers have provided Agent (i) notice of such Acquisition and (ii) a copy of all available
business and financial information reasonably requested by Agent including pro forma financial statements, statements of cash flow, and Availability projections; (f) not later than 15 Business Days prior to the anticipated closing date of such
Acquisition, Borrowers shall have provided the Agent with copies of the acquisition agreement and other material documents relative to such Acquisition, which agreement and documents must be reasonably acceptable to Agent; (g) the aggregate
purchase consideration payable (including deferred payment obligations, but excluding issuances of Equity Interests of Clearwater) in respect of all Acquisitions made during the term of this Agreement shall not exceed $50,000,000; (h) if such
Acquisition is an acquisition of the Equity Interests of a Person, the Acquisition is structured so that the acquired Person shall become a wholly-owned Subsidiary of a Borrower and, in accordance with Section 10.1.9, an Obligor pursuant
to the terms of this Agreement; (i) if such Acquisition is an acquisition of assets, the Acquisition is structured so that an Obligor (or a newly organized Subsidiary that becomes an Obligor) shall acquire such assets; (j) the assets being
acquired (other than a de minimis amount of assets in relation to the assets being acquired) are located within the United States, or the Person whose Equity Interests are being acquired is organized in a jurisdiction located within the
United States; (k) no Debt will be incurred, assumed, or would exist with respect to Borrower or its Subsidiaries as a result of such Acquisition, other than Debt permitted under Section 10.2.1 and no Liens will be incurred,
assumed, or would exist with respect to the assets of Borrower or its Subsidiaries as a result or such Acquisition other than Permitted Liens; and (l) both before and after giving effect to any such Acquisition, Modified Availability is greater
than $50,000,000. In no event will assets acquired pursuant to a Permitted Acquisition constitute Eligible Accounts, Eligible Inventory or Eligible Semi-Finished Inventory prior to completion of a field examination and other due diligence acceptable
to Agent in its discretion. 
 Permitted Asset Disposition: as long as: (x) no Default or Event of Default exists
(provided that, in the case of clauses (a) and (c) only, such Asset Dispositions will continue to be permitted unless Agent has given Borrower Agent notice otherwise), and (y) in the case of clauses (a) and (c) only, all Net

  

 -17- 

 
Proceeds are remitted to a Dominion Account, an Asset Disposition that is: (a) a sale of Inventory in the Ordinary Course of Business; (b) a disposition of Equipment that, in the
aggregate during any 12 month period, has a fair market or book value (whichever is more) of $10,000,000 or less; (c) a disposition of Inventory that is obsolete, unmerchantable or otherwise unsalable in the Ordinary Course of Business;
(d) termination of a lease of real or personal Property that is not necessary for the Ordinary Course of Business, could not reasonably be expected to have a Material Adverse Effect and does not result from an Obligor’s default; (e) a
disposition of Property (other than any Collateral) that is exchanged for credit against the purchase price of similar replacement property, (f) a transfer of Property by: (i) a Borrower to another Borrower; (ii) a Guarantor to
another Guarantor; or (iii) a Guarantor to a Borrower; (g) a sale of Property in one transaction, the proceeds of which will be used to satisfy and discharge or make arrangements for the satisfaction and discharge or prepayment of
Clearwater’s obligations under the Retained Obligation Agreement so long as: (i) the aggregate fair market or book value (whichever is more) of all Collateral sold in such transaction does not exceed $10,000,000; (ii) such transaction
could not reasonably be expected to have a Material Adverse Effect; (iii) Borrowers remit to Agent for application to the Obligations an amount equal to the fair market or book value (whichever is more) of all Collateral sold in such
transaction; (iv) not later than thirty (30) days prior to the anticipated closing date of such transaction, Borrowers shall have provided the Agent with written notice of such proposed transaction; (v) the proceeds of the proposed
transaction which can be allocated to the Collateral being sold in such transaction exceed the amount of the Borrowing Base attributable to such Collateral; and (vi) not later than 15 Business Days prior to the anticipated closing date of such
transaction, Borrowers shall have provided the Agent with copies of the sale agreement and other material documents relative to such transaction, which agreement and documents must be reasonably acceptable to Agent; (h) a transfer of Property
by Clearwater to Retainco prior to the “Distribution” (as defined in the Separation Agreement) in accordance with the terms of the Spin-Off Documents; (i) a distribution of Retainco to Potlatch in accordance with the terms of the
Spin-Off Documents; or (j) approved in writing by Agent and Required Lenders. 
 Permitted Contingent Obligations:
Contingent Obligations (a) arising from endorsements of Payment Items for collection or deposit in the Ordinary Course of Business; (b) arising from Hedging Agreements permitted hereunder; (c) existing on the Closing Date, and any
extension or renewal thereof that does not increase the amount of such Contingent Obligation when extended or renewed; (d) incurred in the Ordinary Course of Business with respect to surety, appeal or performance bonds, or other similar
obligations; (e) arising from customary indemnification obligations in favor of purchasers in connection with dispositions of Equipment permitted hereunder; (f) arising under the Loan Documents; (g) in an aggregate amount of
$3,000,000 or less at any time; (h) consisting of customary indemnification obligations included in contracts entered into in the Ordinary Course of Business, (i) to the extent considered Debt permitted by Section 10.2.1,
(j) pursuant to guaranties by an Obligor of the obligations of anther Obligor with respect to lease, contracts and other commitments entered into in the Ordinary Course of Business; (k) arising under (i) contracts that Clearwater
has assigned to Potlatch or an Affiliate of Potlatch in connection with the Spin-Off and as to which Clearwater has not been released and (ii) contracts for the supply of goods or services or for the lease of equipment that were initially
entered into by Clearwater, Potlatch or an Affiliate of Potlatch and to which, in the case of the contracts initially entered into by Clearwater, Potlatch or an Affiliate of Potlatch has been added as a party, and in the case of the contracts
initially entered into by Potlatch or an Affiliate of Potlatch, Clearwater has been added as a party; and in all cases, (1) such Persons have been added as parties in connection with the Spin-Off to enable their businesses which such Persons
have after the Spin-Off to continue to receive goods and services and to lease the equipment such businesses received or leased before the Spin-Off, and (2) Clearwater’s liability under such contracts will not result in a Material
Adverse Effect; or (l) consisting of obligations to make take or pay or similar payments pursuant to supply agreements entered into in the Ordinary Course of Business. 
 Permitted Lien: as defined in Section 10.2.2. 
  

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 Permitted Purchase Money Debt: Purchase Money Debt of Borrowers and Subsidiaries that
is unsecured or secured only by a Purchase Money Lien, as long as the aggregate amount incurred in any fiscal year of Clearwater does not exceed $30,000,000. 
 Person: any individual, corporation, limited liability company, partnership, joint venture, joint stock company, land trust, business trust, unincorporated organization, Governmental Authority or
other entity. 
 Plan: any employee benefit plan (as such term is defined in Section 3(3) of ERISA), other than a
Foreign Plan, established by an Obligor or, with respect to any such plan that is subject to Section 412 of the Code or Title IV of ERISA, an ERISA Affiliate. 
 Potlatch: Potlatch Corporation, a Delaware corporation. 
 Potlatch
Escrow Account: the “Escrow Account” as defined under, and established pursuant to, the Retained Obligation Agreement. 
 Potlatch Indebtedness: the obligations of Clearwater under (i) Section 3.1(a) of the Contribution and Assumption Agreement, dated December 30, 2005, between Potlatch and Clearwater
and (ii) the Retained Obligation Agreement. 
 Prime Rate: the rate of interest announced by Bank of America from
time to time as its prime rate. Such rate is set by Bank of America on the basis of various factors, including its costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans,
which may be priced at, above or below such rate. Any change in such rate announced by Bank of America shall take effect at the opening of business on the day specified in the public announcement of such change. 

Pro Rata: with respect to any Lender, a percentage (carried out to the ninth decimal place) determined (a) while Revolver
Commitments are outstanding, by dividing the amount of such Lender’s Revolver Commitment by the aggregate amount of all Revolver Commitments; and (b) at any other time, by dividing the amount of such Lender’s Loans and LC Obligations
by the aggregate amount of all outstanding Loans and LC Obligations. 
 Proceeds: as defined in Section 7.1.

 Properly Contested: with respect to any obligation of an Obligor, (a) the obligation is subject to a bona fide
dispute regarding amount or the Obligor’s liability to pay; (b) the obligation is being properly contested in good faith by appropriate proceedings promptly instituted and diligently pursued; (c) appropriate reserves have been
established in accordance with GAAP; (d) non-payment could not have a Material Adverse Effect, nor result in forfeiture or sale of any assets of the Obligor; (e) no Lien is imposed on assets of the Obligor, unless bonded and stayed to the
satisfaction of Agent; and (f) if the obligation results from entry of a judgment or other order, such judgment or order is stayed pending appeal or other judicial review. 

Property: any interest in any kind of property or asset, whether real, personal or mixed, or tangible or intangible. 

Protective Advances: as defined in Section 2.1.6. 

Purchase Money Debt: (a) Debt (other than the Obligations) for payment of any of the purchase price of fixed assets;
(b) Debt (other than the Obligations) incurred within 30 days before or after acquisition of any fixed assets, for the purpose of financing any of the purchase price thereof; and (c) any renewals, extensions or refinancings (but not
increases) thereof. 
  

 -19- 

 Purchase Money Lien: a Lien that secures Purchase Money Debt, encumbering only the
fixed assets acquired with such Debt and constituting a Capital Lease or a purchase money security interest under the UCC. 

RCRA: the Resource Conservation and Recovery Act (42 U.S.C. §§ 6991-6991i). 

Real Estate: all right, title and interest (whether as owner, lessor or lessee) in any real Property or any
buildings, structures, parking areas or other improvements thereon. 
 Refinancing Conditions: the
following conditions for Refinancing Debt: (a) it is in an aggregate principal amount that does not exceed the principal amount of the Debt being extended, renewed or refinanced; (b) it has a final maturity no sooner than, a weighted
average life no less than, and an interest rate no greater than, the Debt being extended, renewed or refinanced; (c) it is subordinated to the Obligations at least to the same extent as the Debt being extended, renewed or refinanced;
(d) the financial covenants and payment defaults applicable to it are no less favorable to Borrowers than those applicable to the Debt being extended, renewed or refinanced; (e) no additional Lien is granted to secure it; (f) no
additional Person is obligated on such Debt; and (g) upon giving effect to it, no Default or Event of Default exists. 

Refinancing Debt: Borrowed Money that is the result of an extension, renewal or refinancing of Debt permitted under
Section 10.2.1(b) or (d). 
 Reimbursement Date: as defined in Section 2.3.2. 

Rent and Charges Reserve: the aggregate of (a) all past due rent and other amounts owing by an Obligor to any landlord,
warehouseman, processor, repairman, mechanic, shipper, freight forwarder, broker or other Person who possesses any Collateral or could assert a Lien on any Collateral; and (b) a reserve at least equal to three months’ rent and other
charges that could be payable to any such Person, unless it has executed a Lien Waiver. 
 Report: as defined in
Section 12.2.3. 
 Reportable Event: any of the events set forth in Section 4043(c) of ERISA, other than
(i) events for which the 30 day notice period has been waived; and (ii) to the extent disclosed to Agent, the transactions contemplated by the Spin-Off Documents, including but not limited to any transfers of assets and liabilities from
any of the Pension Plans to plans sponsored by Potlatch or an Affiliate thereof pursuant to the Spin-Off Documents. 

Repurchase Reserve: a reserve in an initial amount equal to $400,000, and increased by $400,000 on the first of each month after
the Closing Date until such time as the Repurchase Reserve equals $1,000,000; provided, however, that the Repurchase Reserve shall be decreased by the amount of any repurchases of Equity Interests permitted to be made under
Section 10.2.4(a)(iii). 
 Required Lenders: Lenders (subject to Section 4.2) having
(a) Revolver Commitments in excess of 50% of the aggregate Revolver Commitments; and (b) if the Revolver Commitments have terminated, Loans in excess of 50% of all outstanding Loans; provided, however, that at any time there
are 2 or more Lenders, “Required Lenders” must include at least 2 Lenders. In addition to the foregoing, Required Lenders must include WFF for as long as WFF holds thirty three and one-third percent (33-1/3%) or more of: (i) the
aggregate Revolver Commitments, and (ii) if the Revolver Commitments have terminated, all outstanding Loans. 
 Reserve
Percentage: the reserve percentage (expressed as a decimal, rounded upward to the nearest 1/8th of 1%) applicable to member banks under regulations issued from time to time by the Board of Governors for determining the maximum reserve
requirement (including any emergency, supplemental or other marginal reserve requirement) with respect to Eurocurrency funding (currently referred to as “Eurocurrency liabilities”). 
  

 -20- 

 Restricted Investment: any Investment by a Borrower or Subsidiary, other than
(a) Investments in Subsidiaries to the extent existing on the Closing Date; (b) Cash Equivalents that are subject to Agent’s Lien and control, pursuant to documentation in form and substance satisfactory to Agent; (c) loans and
advances permitted under Section 10.2.7; (d) Permitted Acquisitions; (e) Investments consisting of accounts receivable created, acquired or made by any Obligor in the Ordinary Course of Business and payable or dischargeable in
accordance with customary trade terms; (f) Investments consisting of Equity Interests, obligations, securities or other Property received by any Obligor in settlement of accounts receivable from bankrupt obligors; (g) Investments existing
on the Closing Date and set forth on Schedule P-1; (h) Investments received as the non-cash portion of the consideration received in connection with a Permitted Asset Disposition; (i) Investments resulting from pledges and deposits
constituting Permitted Liens; (j) Hedging Agreements to the extent permitted under Section 10.2.15; (k) Investments made in the Ordinary Course of Business in connection with obtaining, maintaining or renewing customer
contracts; (l) Investments consisting of the establishment, deposit of funds (other than proceeds of any Revolver Loans) into, and investment of funds on deposit in, the Potlatch Escrow Account in accordance with the terms of the Retained
Obligation Agreement (it being understood that this clause (l) shall not be deemed to be implied consent to any Asset Disposition or incurrence of Debt otherwise prohibited by the terms and conditions of this Agreement); (m) so long as
both before and after giving effect to any such Investment, Modified Availability is greater than $50,000,000, and so long as no Default or Event of Default shall have occurred and be continuing or would result from the making of such Investment,
Investments in joint ventures in which a Borrower or a Guarantor acquires or has an Equity Interest, not to exceed at any time $5,000,000, provided that such limitation shall be increased from time to time as such Borrower or Guarantor receives
distributions or redemptions with respect to such an Equity Interest; (n) the transfer by Clearwater of $50,000,000 to Retainco prior to the distribution of Retainco by Clearwater to Potlatch, all in accordance with the Spin-Off Documents; and
(o) Investments otherwise permitted by Agent in writing. 
 Restrictive Agreement: an agreement (other than a Loan
Document) that conditions or restricts the right of any Borrower, Subsidiary or other Obligor to incur or repay Borrowed Money, to grant Liens on any Borrower’s or Guarantor’s assets, to declare or make Distributions, to modify, extend or
renew any agreement evidencing Borrowed Money, or to repay any intercompany Debt. 
 RetainCo: Potlatch Land &
Lumber LLC, a Delaware limited liability company. 
 Retained Obligation Agreement: the Retained Obligation Agreement to
be entered into between Clearwater and Potlatch substantially in the form of such agreement which has been filed as Exhibit 10.13 to Clearwater’s From 10 filed on November 19, 2008. 

Revolver Commitment: for any Lender, its obligation to make Revolver Loans and to participate in LC Obligations up to the maximum
principal amount shown on Schedule 1.1, or as hereafter determined pursuant to each Assignment and Acceptance to which it is a party, or as increased pursuant to Section 2.1.7. “Revolver Commitments” means the
aggregate amount of such commitments of all Lenders. 
 Revolver Loan: a loan made pursuant to Section 2.1,
and any Swingline Loan, Overadvance Loan or Protective Advance. 
 Revolver Note: a promissory note to be executed by
Borrowers in favor of a Lender in the form of Exhibit A, which shall be in the amount of such Lender’s Revolver Commitment and shall evidence the Revolver Loans made by such Lender. 

 

 -21- 

 Revolver Termination Date: the earlier of: (a) four (4) years from
the date of this Agreement, or (b) ninety (90) days prior to the maturity date of the Potlatch Indebtedness.  

Royalties: all royalties, fees, expense reimbursement and other amounts payable by a Borrower under a License. 

S&P: Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc., and its successors.

 Secured Parties: Agent, Issuing Bank, Lenders and providers of Bank Products. 

Security Documents: the Guaranties, Deposit Account Control Agreements, and all other documents, instruments and agreements now or
hereafter securing (or given with the intent to secure) any Obligations. 
 Senior Officer: the chairman of the board,
president, chief executive officer or chief financial officer of a Borrower or, if the context requires, an Obligor. 

Separation Agreement: that certain Separation and Distribution Agreement to be entered into between Potlatch and Clearwater
substantially in the form of such agreement which has been filed as Exhibit 2.1 to Clearwater’s Form 10 filed on November 19, 2008. 
 Settlement Report: a report delivered by Agent to Lenders summarizing the Revolver Loans and participations in LC Obligations outstanding as of a given settlement date, allocated to Lenders on a
Pro Rata basis in accordance with their Revolver Commitments. 
 Solvent: as to any Person, such Person (a) owns
Property whose fair salable value is greater than the amount required to pay all of its debts (including contingent, subordinated, unmatured and unliquidated liabilities); (b) owns Property whose present fair salable value (as defined below) is
greater than the probable total liabilities (including contingent, subordinated, unmatured and unliquidated liabilities) of such Person as they become absolute and matured; (c) is able to pay all of its debts as they mature; (d) has
capital that is not unreasonably small for its business and is sufficient to carry on its business and transactions and all business and transactions in which it is about to engage; (e) is not “insolvent” within the meaning of
Section 101(32) of the Bankruptcy Code; and (f) has not incurred (by way of assumption or otherwise) any obligations or liabilities (contingent or otherwise) under any Loan Documents, or made any conveyance in connection therewith, with
actual intent to hinder, delay or defraud either present or future creditors of such Person or any of its Affiliates. “Fair salable value” means the amount that could be obtained for assets within a reasonable time, either through
collection or through sale under ordinary selling conditions by a capable and diligent seller to an interested buyer who is willing (but under no compulsion) to purchase. 
 Spin-Off: the Separation (as defined in the Separation Agreement) and the Distribution (as defined in the Separation Agreement) pursuant to the Separation Agreement. 

Spin-Off Documents: the Separation Agreement and the Ancillary Agreements (as defined in the Separation Agreement). 

Subordinated Debt: Debt incurred by a Borrower that is expressly subordinate and junior in right of payment to Full Payment of all
Obligations, and is on terms (including maturity, interest, fees, repayment, covenants and subordination) satisfactory to Agent. 
 Subsidiary: any entity at least 50% of whose voting securities or Equity Interests is owned by a Borrower or any combination of Borrowers (including indirect ownership by a Borrower through other
entities in which the Borrower directly or indirectly owns 50% of the voting securities or Equity Interests). 
  

 -22- 

 Suppressed Availability: on any date of determination, the difference between
(a) the sum of the Accounts Formula Amount, plus the Inventory Formula Amount, minus the Availability Reserve, and (b) the aggregate amount of Revolver Commitments; provided, however, that if such difference is
less than zero, Suppressed Availability shall be deemed to be zero. 
 Swingline Loan: any Borrowing of Base Rate
Revolver Loans funded with Agent’s funds, until such Borrowing is settled among Lenders or repaid by Borrowers. 

Taxes: all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments,
fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto. 
 Transferee: any actual or potential Eligible Assignee, Participant or other Person acquiring an interest in any Obligations. 

Trigger Period: the period (a) commencing on the day that an Event of Default occurs, or Availability is less than, at any
time, an amount equal to twenty percent (20%) of the then aggregate Revolver Commitments; and (b) continuing until, during the preceding 60 consecutive days, no Event of Default has existed and Availability has been greater than, at all
times, an amount equal to twenty-five percent (25%) of the then aggregate Revolver Commitments. 
 Type: any type of
a Loan (i.e., Base Rate Loan or LIBOR Loan) that has the same interest option and, in the case of LIBOR Loans, the same Interest Period. 
 UCC: the Uniform Commercial Code as in effect in the State of California or, when the laws of any other jurisdiction govern the perfection or enforcement of any Lien, the Uniform Commercial Code of
such jurisdiction. 
 Unfunded Pension Liability: the excess of a Pension Plan’s projected benefit obligation, over
the fair current value of that Pension Plan’s assets, in each case determined in accordance with Statement of Financial Accounting Standards (“SFAS”) No. 87 (as modified by SFAS No. 158) as of the most recent financial
statement of the applicable Pension Plan Sponsor. 
 Unused Line Margin: the percentage set forth below, as determined by
the Line Usage for the prior month: 
  

						
	 Level
	  	 Line Usage
	  	Unused Line
Margin	 
	I	  	Greater than 67%	  	0.50	% 
			
	II	  	Less than or equal to 67%, but greater than 25%	  	0.625	% 
			
	III	  	Less than or equal to 25%	  	0.75	% 

 Notwithstanding the forgoing,
from the date hereof until the first day of the month immediately following the date which is 90 days after the date hereof, the Unused Line Margin shall be determined as if Level II were applicable regardless of the Line Usage for the last month.
Thereafter, the Unused Line Margin shall be subject to increase or decrease based upon the Line Usage for the prior month, as determined by Agent. If by the first day of a month, any Borrowing Base Certificate due in the preceding month has not been
received, then, at the option of Agent or Required Lenders, the Unused Line Margin shall be determined as if Level III were applicable, from such day until the first day of the calendar month following actual receipt. 

 

 -23- 

 Upstream Payment: a Distribution by a Subsidiary of a Borrower to such Borrower.

 Value: (a) for Inventory, its value determined on the basis of the lower of cost or market, calculated on a
first-in, first-out basis, and excluding any portion of cost attributable to intercompany profit among Borrowers and their Affiliates; and (b) for an Account, its face amount, net of any returns, rebates, discounts (calculated on the shortest
terms), credits, allowances or Taxes (including sales, excise or other taxes) that have been or could be claimed by the Account Debtor or any other Person. 
 WFF: Wells Fargo Foothill, LLC, a Delaware limited liability company. 

1.2. Accounting Terms. Under the Loan Documents (except as otherwise specified herein), all accounting terms shall be
interpreted, all accounting determinations shall be made, and all financial statements shall be prepared, in accordance with GAAP applied on a basis consistent with the most recent audited financial statements of Borrowers delivered to Agent before
the Closing Date and using the same inventory valuation method as used in such financial statements, except for any change required or permitted by GAAP if Borrowers’ certified public accountants concur in such change, the change is disclosed
to Agent, and Section 10.3 is amended in a manner satisfactory to Required Lenders to take into account the effects of the change. 
 1.3. Uniform Commercial Code. As used herein, the following terms are defined in accordance with the UCC in effect in the State of California from time to time: “Chattel Paper,”
“Commercial Tort Claim,” “Document,” “Equipment,” “General Intangibles,” “Goods,” “Instrument,” “Investment Property,” “Letter-of-Credit Right” and “Supporting
Obligation.” 
 1.4. Certain Matters of Construction. The terms “herein,”
“hereof,” “hereunder” and other words of similar import refer to this Agreement as a whole and not to any particular section, paragraph or subdivision. Any pronoun used shall be deemed to cover all genders. In the computation of
periods of time from a specified date to a later specified date, “from” means “from and including,” and “to” and “until” each mean “to but excluding.” The terms “including” and
“include” shall mean “including, without limitation” and, for purposes of each Loan Document, the parties agree that the rule of ejusdem generis shall not be applicable to limit any provision. Section titles appear as a
matter of convenience only and shall not affect the interpretation of any Loan Document. All references to (a) laws or statutes include all related rules, regulations, interpretations, amendments and successor provisions; (b) any document,
instrument or agreement include any amendments, waivers and other modifications, extensions or renewals (to the extent permitted by the Loan Documents); (c) any section mean, unless the context otherwise requires, a section of this Agreement;
(d) any exhibits or schedules mean, unless the context otherwise requires, exhibits and schedules attached hereto, which are hereby incorporated by reference; (e) any Person include successors and assigns; (f) time of day mean time of
day at Agent’s notice address under Section 14.3.1; or (g) discretion of Agent, Issuing Bank or any Lender mean the sole and absolute discretion of such Person. All calculations of Value, fundings of Loans, issuances of Letters
of Credit and payments of Obligations shall be in Dollars and, unless the context otherwise requires, all determinations (including calculations of Borrowing Base and financial covenants) made from time to time under the Loan Documents shall be made
in light of the circumstances existing at such time. Borrowing Base calculations shall be consistent with historical methods of valuation and calculation, and otherwise satisfactory to Agent (and not necessarily calculated in accordance with GAAP).
Borrowers shall have the burden of establishing any alleged negligence, misconduct or lack of good faith by Agent, Issuing Bank or any Lender under any Loan Documents. No provision of any Loan Documents shall be construed against any party by reason
of such party having, or being deemed to have, drafted the provision. Whenever the phrase “to the best of Borrowers’ knowledge” or words of similar import are used in any Loan Documents, it means actual knowledge of a Senior Officer,
or knowledge that a Senior 
  

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Officer would have obtained if he or she had engaged in good faith and diligent performance of his or her duties, including reasonably specific inquiries of employees or agents and a good faith
attempt to ascertain the matter to which such phrase relates. 
 SECTION 2. CREDIT FACILITIES 

2.1. Revolver Commitment. 
 2.1.1. Revolver Loans. Each Lender agrees, severally on a Pro Rata basis up to its Revolver Commitment, on the terms set forth herein, to make Revolver Loans to Borrowers from time to time through
the Commitment Termination Date. The Revolver Loans may be repaid and reborrowed as provided herein. In no event shall Lenders have any obligation to honor a request for a Revolver Loan if the unpaid balance of Revolver Loans outstanding at such
time (including the requested Loan) would exceed the Borrowing Base. 
 2.1.2. Revolver Notes. The Revolver Loans made by
each Lender and interest accruing thereon shall be evidenced by the records of Agent and such Lender. At the request of any Lender, Borrowers shall deliver a Revolver Note to such Lender. 

2.1.3. Use of Proceeds. The proceeds of Revolver Loans shall be used by Borrowers solely (a) to pay fees and transaction
expenses associated with the closing of this credit facility; (b) to pay Obligations in accordance with this Agreement; and (c) for working capital and other lawful corporate purposes of Borrowers, including payments of interest on the
Potlatch Indebtedness. 
 2.1.4. Termination of Revolver Commitments. 

(a) The Revolver Commitments shall terminate on the Revolver Termination Date, unless sooner terminated in accordance with this Agreement.
Upon at least 30 days’ prior written notice to Agent at any time, Borrowers may, at their option, terminate the Revolver Commitments and this credit facility. Any notice of termination given by Borrowers shall be irrevocable. On the termination
date, Borrowers shall make Full Payment of all Obligations. 
 (b) Concurrently with any termination of the Revolver
Commitments, for whatever reason (including an Event of Default), Borrowers shall pay to Agent, for the Pro Rata benefit of Lenders and as liquidated damages for loss of bargain (and not as a penalty), an amount equal to 0.50% of the Revolver
Commitments being terminated if the termination occurs during the first Loan Year. No termination charge shall be payable if termination occurs in connection with a refinancing of this credit facility by Bank of America or any of its Affiliates.

 2.1.5. Overadvances. If the aggregate Revolver Loans exceed the Borrowing Base (“Overadvance”) or the
aggregate Revolver Commitments at any time, the excess amount shall be payable by Borrowers on demand by Agent, but all such Revolver Loans shall nevertheless constitute Obligations secured by the Collateral and entitled to all benefits of
the Loan Documents. Unless its authority has been revoked in writing by Required Lenders, Agent may require Lenders to honor requests for Overadvance Loans and to forbear from requiring Borrowers to cure an Overadvance, (a) when no other Event
of Default is known to Agent, as long as (i) the Overadvance does not continue for more than 30 consecutive days (and no Overadvance may exist for at least five consecutive days thereafter before further Overadvance Loans are required), and
(ii) the Overadvance is not known by Agent to exceed 10% of the Borrowing Base; and (b) regardless of whether an Event of Default exists, if Agent discovers an Overadvance not previously known by it to exist, as long as from the date of
such discovery the Overadvance (i) is not increased by more than $5,000,000, and (ii) does not continue for more than 30 consecutive days. In no event shall Overadvance Loans be required that would cause the outstanding Revolver Loans
(including the Overadvances and any Protective Advances) and LC Obligations to exceed 
  

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the aggregate Revolver Commitments, or that would cause the sum of the outstanding Overadvances known by Agent to exist plus any outstanding Protective Advances to exceed $15,000,000. Any funding
of an Overadvance Loan or sufferance of an Overadvance shall not constitute a waiver by Agent or Lenders of the Event of Default caused thereby. In no event shall any Borrower or other Obligor be deemed a beneficiary of this Section nor authorized
to enforce any of its terms. 
 2.1.6. Protective Advances. Agent shall be authorized, in its discretion, at any time
that any condition in Section 6 is not satisfied, to make Base Rate Revolver Loans (“Protective Advances”) (a) up to an aggregate amount of $12,500,000 outstanding at any time, if Agent deems such Loans necessary or
desirable to preserve or protect Collateral, or to enhance the collectibility or repayment of Obligations; or (b) to pay any other amounts chargeable to Obligors under any Loan Documents, including costs, fees and expenses. Each Lender shall
participate in each Protective Advance on a Pro Rata basis. Required Lenders may at any time revoke Agent’s authority to make further Protective Advances by written notice to Agent. Absent such revocation, Agent’s determination that
funding of a Protective Advance is appropriate shall be conclusive. In no event shall Protective Advances be required that would cause the outstanding Revolver Loans (including the Protective Advances and any Overadvances) and LC Obligations to
exceed the aggregate Revolver Commitments, or that would cause the sum of the outstanding Protective Advances plus any Overadvances known by Agent to exist, to exceed $15,000,000. 

2.1.7. Increases in Revolver Commitments. Notwithstanding anything to the contrary contained in this Agreement: 

(a) Provided there exists no Default or Event of Default, and subject to the terms and conditions of this Section 2.1.7, on no more
than 2 occasions, upon notice to Agent and Lenders, Borrowers may request an increase in the Revolver Commitments to an amount not more than $150,000,000 in the aggregate. Each Lender shall notify Agent within 10 Business Days from the date of
delivery of such notice whether or not it agrees to increase its Revolver Commitment and, if so, whether by an amount equal to, greater than, or less than its Pro Rata share of such requested increase. Any Lender not responding within such time
period shall be deemed to have declined to increase such Revolver Commitment. Agent shall notify Borrowers and each Lender of the Lenders’ responses to each request made hereunder. If the existing Lenders shall have declined to provide the full
amount of the requested increase, to achieve the full amount of the requested increase, Agent may (in consultation with Borrowers), invite additional lending institutions that constitute Eligible Assignees to become Lenders pursuant to a joinder
agreement in form and substance satisfactory to Agent and its counsel. Nothing in this Agreement shall be construed to obligate any Lender to increase its Revolver Commitment. 
 (b) If the Revolver Commitments are increased in accordance with this Section 2.1.7, Agent and Borrowers shall determine the effective date (the “Increase Effective Date”),
and Agent shall determine the final allocation of such increase. Agent shall promptly notify Borrowers and the Lenders of the final allocation of such increase and the Increase Effective Date. As a condition precedent to such increase, (i) the
Agent shall have received amendments to this Agreement and the Loan Documents, joinder agreements, and all other promissory notes, agreements, documents and instruments requested by Agent in its discretion; and (ii) Borrowers shall (A) pay
to Agent (1) for the account of the Lenders that are increasing their Revolver Commitments, a closing fee, which closing fee shall be computed on the increase in aggregate Revolver Commitments as agreed by Borrowers and such Lenders, and
(2) for Agent’s own account the fees and reasonable expenses of Agent incurred in connection with such increase; and (B) deliver to Agent a certificate of each Obligor dated as of the Increase Effective Date signed by a Senior Officer
or otherwise acceptable officer of such Obligor (1) certifying and attaching the resolutions adopted by such Obligor approving or consenting to such increase, and (2) in the case of Borrowers, certifying that, before and after giving
effect to such increase, (x) the representations and warranties contained in Section 9 and the other Loan Documents are true and correct in all material respects on and as of the Increase Effective Date, except to the extent that
such representations and warranties specifically refer to an earlier date, in which case they are true and correct in all material respects as of such earlier date, and (y) no Default or Event of Default exists. 

 

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 2.2. Intentionally Omitted. 

2.3. Letter of Credit Facility. 
 2.3.1. Issuance of Letters of Credit. Issuing Bank agrees to issue Letters of Credit from time to time until 30 days prior to the Revolver Termination Date (or until the Commitment Termination
Date, if earlier), on the terms set forth herein, including the following: 
 (a) Each Borrower acknowledges that Issuing
Bank’s willingness to issue any Letter of Credit is conditioned upon Issuing Bank’s receipt of a LC Application with respect to the requested Letter of Credit, as well as such other instruments and agreements as Issuing Bank may
customarily require for issuance of a letter of credit of similar type and amount. Issuing Bank shall have no obligation to issue any Letter of Credit unless (i) Issuing Bank receives a LC Request and LC Application at least three Business Days
prior to the requested date of issuance; (ii) each LC Condition is satisfied; and (iii) if a Defaulting Lender exists, such Lender or Borrowers have entered into arrangements satisfactory to Agent and Issuing Bank to eliminate any funding
risk associated with the Defaulting Lender. If Issuing Bank receives written notice from a Lender at least five Business Days before issuance of a Letter of Credit that any LC Condition has not been satisfied, Issuing Bank shall have no obligation
to issue the requested Letter of Credit (or any other) until such notice is withdrawn in writing by that Lender or until Required Lenders have waived such condition in accordance with this Agreement. Prior to receipt of any such notice, Issuing Bank
shall not be deemed to have knowledge of any failure of LC Conditions. 
 (b) Letters of Credit may be requested by a Borrower
only (i) to support obligations of such Borrower incurred in the Ordinary Course of Business; or (ii) for other purposes as Agent and Lenders may approve from time to time in writing. The renewal or extension of any Letter of Credit shall
be treated as the issuance of a new Letter of Credit, except that delivery of a new LC Application shall be required at the discretion of Issuing Bank. 
 (c) Borrowers assume all risks of the acts, omissions or misuses of any Letter of Credit by the beneficiary. In connection with issuance of any Letter of Credit, none of Agent, Issuing Bank or any Lender
shall be responsible for the existence, character, quality, quantity, condition, packing, value or delivery of any goods purported to be represented by any Documents; any differences or variation in the character, quality, quantity, condition,
packing, value or delivery of any goods from that expressed in any Documents; the form, validity, sufficiency, accuracy, genuineness or legal effect of any Documents or of any endorsements thereon; the time, place, manner or order in which shipment
of goods is made; partial or incomplete shipment of, or failure to ship, any goods referred to in a Letter of Credit or Documents; any deviation from instructions, delay, default or fraud by any shipper or other Person in connection with any goods,
shipment or delivery; any breach of contract between a shipper or vendor and a Borrower; errors, omissions, interruptions or delays in transmission or delivery of any messages, by mail, cable, telegraph, telex, telecopy, e-mail, telephone or
otherwise; errors in interpretation of technical terms; the misapplication by a beneficiary of any Letter of Credit or the proceeds thereof; or any consequences arising from causes beyond the control of Issuing Bank, Agent or any Lender, including
any act or omission of a Governmental Authority. The rights and remedies of Issuing Bank under the Loan Documents shall be cumulative. Issuing Bank shall be fully subrogated to the rights and remedies of each beneficiary whose claims against
Borrowers are discharged with proceeds of any Letter of Credit. 
 (d) In connection with its administration of and enforcement
of rights or remedies under any Letters of Credit or LC Documents, Issuing Bank shall be entitled to act, and shall be fully protected in acting, upon any certification, documentation or communication in whatever form believed by Issuing Bank, in
good faith, to be genuine and correct and to have been signed, sent or made by a 
  

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proper Person, except to the extent Issuing Bank shall be grossly negligent in so doing. Issuing Bank may consult with and employ legal counsel, accountants and other experts to advise it
concerning its obligations, rights and remedies, and shall be entitled to act upon, and shall be fully protected in any action taken in good faith reliance upon, any advice given by such experts, except to the extent Issuing Bank shall be grossly
negligent in so doing. Issuing Bank may employ agents and attorneys-in-fact in connection with any matter relating to Letters of Credit or LC Documents, and shall not be liable for the negligence or misconduct of agents and attorneys-in-fact
selected with reasonable care. 
 2.3.2. Reimbursement; Participations. 

(a) If Issuing Bank honors any request for payment under a Letter of Credit, Borrowers shall pay to Issuing Bank, on the same day
(“Reimbursement Date”), the amount paid by Issuing Bank under such Letter of Credit and if Borrowers fail to pay such amount on such day, Borrowers shall also pay interest in such amount at the interest rate for Base Rate Revolver
Loans from the Reimbursement Date until payment by Borrowers. The obligation of Borrowers to reimburse Issuing Bank for any payment made under a Letter of Credit shall be absolute, unconditional, irrevocable, and joint and several, and shall be paid
without regard to any lack of validity or enforceability of any Letter of Credit or the existence of any claim, setoff, defense or other right that Borrowers may have at any time against the beneficiary. Whether or not Borrower Agent submits a
Notice of Borrowing, if Borrowers do not, on the Reimbursement Date, pay Issuing Bank the amount paid under the Letter of Credit, Borrowers shall be deemed to have requested a Borrowing of Base Rate Revolver Loans in an amount necessary to pay all
amounts due Issuing Bank on any Reimbursement Date and each Lender agrees to fund its Pro Rata share of such Borrowing whether or not the Commitments have terminated, an Overadvance exists or is created thereby, or the conditions in
Section 6 are satisfied. 
 (b) Upon issuance of a Letter of Credit, each Lender shall be deemed to have irrevocably
and unconditionally purchased from Issuing Bank, without recourse or warranty, an undivided Pro Rata interest and participation in all LC Obligations relating to the Letter of Credit. If Issuing Bank makes any payment under a Letter of Credit and
Borrowers do not reimburse such payment on the Reimbursement Date, Agent shall promptly notify Lenders and each Lender shall promptly (within one Business Day) and unconditionally pay to Agent, for the benefit of Issuing Bank, the Lender’s Pro
Rata share of such payment. Upon request by a Lender, Issuing Bank shall furnish copies of any Letters of Credit and LC Documents in its possession at such time. 
 (c) The obligation of each Lender to make payments to Agent for the account of Issuing Bank in connection with Issuing Bank’s payment under a Letter of Credit shall be absolute, unconditional and
irrevocable, not subject to any counterclaim, setoff, qualification or exception whatsoever, and shall be made in accordance with this Agreement under all circumstances, irrespective of any lack of validity or unenforceability of any Loan Documents;
any draft, certificate or other document presented under a Letter of Credit having been determined to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect; or the existence
of any setoff or defense that any Obligor may have with respect to any Obligations. Issuing Bank does not assume any responsibility for any failure or delay in performance or any breach by any Borrower or other Person of any obligations under any LC
Documents. Issuing Bank does not make to Lenders any express or implied warranty, representation or guaranty with respect to the Collateral, LC Documents or any Obligor. Issuing Bank shall not be responsible to any Lender for any recitals,
statements, information, representations or warranties contained in, or for the execution, validity, genuineness, effectiveness or enforceability of any LC Documents; the validity, genuineness, enforceability, collectibility, value or sufficiency of
any Collateral or the perfection of any Lien therein; or the assets, liabilities, financial condition, results of operations, business, creditworthiness or legal status of any Obligor. 

(d) No Issuing Bank Indemnitee shall be liable to any Lender or other Person for any action taken or omitted to be taken in connection
with any LC Documents except as a result of its actual 
  

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gross negligence or willful misconduct. Issuing Bank shall not have any liability to any Lender if Issuing Bank refrains from any action under any Letter of Credit or LC Documents until it
receives written instructions from Required Lenders. 
 2.3.3. Cash Collateral. If any LC Obligations, whether or not
then due or payable, shall for any reason be outstanding at any time (a) that an Event of Default exists, (b) that Availability is less than zero, (c) after the Commitment Termination Date, or (d) within 5 Business Days prior to
the Revolver Termination Date, then Borrowers shall, at Issuing Bank’s or Agent’s request, Cash Collateralize the stated amount of all outstanding Letters of Credit and all other LC Obligations. Borrowers shall, on demand by Issuing
Bank or Agent from time to time, Cash Collateralize the LC Obligations of any Defaulting Lender. If Borrowers fail to provide any Cash Collateral as required hereunder, Lenders may (and shall upon direction of Agent) advance, as Revolver Loans, the
amount of the Cash Collateral required (whether or not the Commitments have terminated, an Overadvance exists or the conditions in Section 6 are satisfied). 
 SECTION 3. INTEREST, FEES AND CHARGES 
 3.1. Interest.

 3.1.1. Rates and Payment of Interest. 
 (a) The Obligations shall bear interest (i) if a Base Rate Loan, at the Base Rate in effect from time to time, plus the Applicable Margin; (ii) if a LIBOR Loan, at LIBOR for the applicable
Interest Period, plus the Applicable Margin; and (iii) if any other Obligation (including, to the extent permitted by law, interest not paid when due), at the Base Rate in effect from time to time, plus the Applicable Margin for Base Rate
Revolver Loans. Interest shall accrue from the date the Loan is advanced or the Obligation is incurred or payable, until paid by Borrowers. If a Loan is repaid on the same day made, one day’s interest shall accrue. 

(b) During an Insolvency Proceeding with respect to any Borrower, or during any other Event of Default if Agent or Required Lenders in
their discretion so elect, Obligations shall bear interest at the Default Rate (whether before or after any judgment). Each Borrower acknowledges that the cost and expense to Agent and Lenders due to an Event of Default are difficult to ascertain
and that the Default Rate is a fair and reasonable estimate to compensate Agent and Lenders for this. 
 (c) Interest accrued on
the Loans shall be due and payable in arrears, (i) on the first day of each month; (ii) on any date of prepayment, with respect to the principal amount of Loans being prepaid; and (iii) on the Commitment Termination Date. Interest
accrued on any other Obligations shall be due and payable as provided in the Loan Documents and, if no payment date is specified, shall be due and payable on demand. Notwithstanding the foregoing, interest accrued at the Default Rate shall be
due and payable on demand. 
 3.1.2. Application of LIBOR to Outstanding Loans. 

(a) Borrowers may on any Business Day, subject to delivery of a Notice of Conversion/Continuation, elect to convert any portion of the
Base Rate Loans to, or to continue any LIBOR Loan at the end of its Interest Period as, a LIBOR Loan. During any Default or Event of Default, Agent may (and shall at the direction of Required Lenders) declare that no Loan may be made, converted or
continued as a LIBOR Loan. 
 (b) Whenever Borrowers desire to convert or continue Loans as LIBOR Loans, Borrower Agent shall
give Agent a Notice of Conversion/Continuation, no later than 11:00 a.m. at least three Business Days before the requested conversion or continuation date. Promptly after receiving any 

 

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such notice, Agent shall notify each Lender thereof. Each Notice of Conversion/Continuation shall be irrevocable, and shall specify the amount of Loans to be converted or continued, the
conversion or continuation date (which shall be a Business Day), and the duration of the Interest Period (which shall be deemed to be 30 days if not specified). If, upon the expiration of any Interest Period in respect of any LIBOR Loans, Borrowers
shall have failed to deliver a Notice of Conversion/Continuation, they shall be deemed to have elected to convert such Loans into Base Rate Loans. 
 3.1.3. Interest Periods. In connection with the making, conversion or continuation of any LIBOR Loans, Borrowers shall select an interest period (“Interest Period”) to apply, which
interest period shall be 30, 60, or 90 days; provided, however, that: 
 (a) the Interest Period shall commence on
the date the Loan is made or continued as, or converted into, a LIBOR Loan, and shall expire on the numerically corresponding day in the calendar month at its end; 
 (b) if any Interest Period commences on a day for which there is no corresponding day in the calendar month at its end or if such corresponding day falls after the last Business Day of such month, then
the Interest Period shall expire on the last Business Day of such month; and if any Interest Period would expire on a day that is not a Business Day, the period shall expire on the next Business Day; and 

(c) no Interest Period shall extend beyond the Revolver Termination Date. 

3.2. Fees. 
 3.2.1. Unused Line Fee. Borrowers shall pay to Agent, for the Pro Rata benefit of Lenders, a fee equal to the Unused Line Margin per annum times the amount by which the Revolver Commitments (minus
the Availability Block) exceed the average daily balance of Revolver Loans and stated amount of Letters of Credit during any month. Such fee shall be payable in arrears, on the first day of each month and on the Commitment Termination Date.

 3.2.2. LC Facility Fees. Borrowers shall pay (a) to Agent, for the Pro Rata benefit of Lenders, a fee equal to
the Applicable Margin in effect for LIBOR Revolver Loans times the average daily stated amount of Letters of Credit, which fee shall be payable monthly in arrears, on the first day of each month; (b) to Agent, for its own account, a fronting
fee equal to 0.125% per annum on the stated amount of each Letter of Credit, which fee shall be payable monthly in arrears, on the first day of each month; and (c) to Issuing Bank, for its own account, all customary charges associated with
the issuance, amending, negotiating, payment, processing, transfer and administration of Letters of Credit, which charges shall be paid as and when incurred. During an Event of Default, the fee payable under clause (a) shall be increased by
2% per annum. 
 3.2.3. Agent Fees. In consideration of Agent’s syndication of the Commitments and service as
Agent hereunder, Borrowers shall pay to Agent, for its own account, the fees described in the Agent Fee Letter. 
 3.2.4.
Other Fees. In consideration of Bank of America’s and WFF’s execution of this Agreement, Borrowers shall pay to Agent, for the account of Bank of America and WFF, the fees described in the Bank of America-WFF Fee Letter. 

3.3. Computation of Interest, Fees, Yield Protection. All interest, as well as fees and other charges calculated on a per
annum basis, shall be computed for the actual days elapsed, based on a year of 360 days. Each determination by Agent of any interest, fees or interest rate hereunder shall be final, conclusive and binding for all purposes, absent manifest error. All
fees shall be fully earned when due 
  

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and shall not be subject to rebate, refund or proration. All fees payable under Section 3.2 are compensation for services and are not, and shall not be deemed to be, interest or any
other charge for the use, forbearance or detention of money. A certificate as to amounts payable by Borrowers under Section 3.4, 3.6, 3.7, 3.9 or 5.9, submitted to Borrower Agent by Agent or the affected Lender, as
applicable, shall be final, conclusive and binding for all purposes, absent manifest error, and Borrowers shall pay such amounts to the appropriate party within 10 days following receipt of the certificate. 

3.4. Reimbursement Obligations. Borrowers shall reimburse Agent for all Extraordinary Expenses. Borrowers shall also
reimburse Agent for all legal, accounting, appraisal, consulting, and other fees, costs and expenses incurred by it in connection with (a) negotiation and preparation of any Loan Documents, including any amendment or other modification thereof;
(b) administration of and actions relating to any Collateral, Loan Documents and transactions contemplated thereby, including any actions taken to perfect or maintain priority of Agent’s Liens on any Collateral, to maintain any insurance
required hereunder or to verify Collateral; and (c) subject to the limits of Section 10.1.1(b), each inspection, audit or appraisal with respect to any Obligor or Collateral, whether prepared by Agent’s personnel or a third
party. All legal, accounting and consulting fees shall be charged to Borrowers by Agent’s professionals at their full hourly rates, regardless of any reduced or alternative fee billing arrangements that Agent, any Lender or any of their
Affiliates may have with such professionals with respect to this or any other transaction. If, for any reason (including inaccurate reporting on financial statements, a Borrowing Base Certificate, or a Compliance Certificate), it is determined that
a higher Applicable Margin or Unused Line Margin should have applied to a period than was actually applied, then the proper margin shall be applied retroactively and Borrowers shall immediately pay to Agent, for the Pro Rata benefit of Lenders, an
amount equal to the difference between the amount of interest and fees that would have accrued using the proper margin and the amount actually paid. All amounts payable by Borrowers under this Section shall be due on demand. If within thirty
(30) days after the end of any month it is determined that a lower Applicable Margin or Unused Line Margin should have applied to the prior month than was actually applied, and Borrower Agent sends notice to Agent within such thirty
(30) days, the Borrowers shall receive a credit from Agent in an amount equal to the difference between the amount actually paid for such month and the amount of interest and fees that would have accrued using the proper margin. 

3.5. Illegality. If any Lender determines that any Applicable Law has made it unlawful, or that any Governmental Authority
has asserted that it is unlawful, for any Lender or its applicable Lending Office to make, maintain or fund LIBOR Loans, or to determine or charge interest rates based upon LIBOR, or any Governmental Authority has imposed material restrictions on
the authority of such Lender to purchase or sell, or to take deposits of, Dollars in the London interbank market, then, on notice thereof by such Lender to Agent, any obligation of such Lender to make or continue LIBOR Loans or to convert Base Rate
Loans to LIBOR Loans shall be suspended until such Lender notifies Agent that the circumstances giving rise to such determination no longer exist. Upon delivery of such notice, Borrowers shall prepay or, if applicable, convert all LIBOR Loans of
such Lender to Base Rate Loans, either on the last day of the Interest Period therefor, if such Lender may lawfully continue to maintain such LIBOR Loans to such day, or immediately, if such Lender may not lawfully continue to maintain such LIBOR
Loans. Upon any such prepayment or conversion, Borrowers shall also pay accrued interest on the amount so prepaid or converted. 

3.6. Inability to Determine Rates. If Agent determines, or if Required Lenders notify Agent, for any reason in connection
with a request for a Borrowing of, or conversion to or continuation of, a LIBOR Loan that (a) Dollar deposits are not being offered to banks in the London interbank Eurodollar market for the applicable amount and Interest Period of such Loan,
(b) adequate and reasonable means do not exist for determining LIBOR for the requested Interest Period, or (c) LIBOR for the requested Interest Period does not adequately and fairly reflect the cost to such Lenders of funding such Loan,
then Agent will promptly so notify Borrower Agent and each Lender. Thereafter, the obligation of Lenders to make or maintain LIBOR Loans shall be suspended until Agent revokes such 

 

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notice. Upon receipt of such notice, Borrower Agent may revoke any pending request for a Borrowing of, conversion to or continuation of a LIBOR Loan or, failing that, will be deemed to have
submitted a request for a Base Rate Loan. 
 3.7. Increased Costs; Capital Adequacy. 

3.7.1. Change in Law. If any Change in Law (other than any Change of Law by way of imposition or increase of Reserve Percentage
included in determining LIBOR) shall: 
 (a) impose modify or deem applicable any reserve, special deposit, compulsory loan,
insurance charge or similar requirement against assets of, deposits with or for the account of, or credit extended or participated in by, any Lender (except any reserve requirement reflected in LIBOR) or Issuing Bank; 

(b) subject any Lender or Issuing Bank to any Tax with respect to any Loan, Loan Document, Letter of Credit or participation in LC
Obligations, or change the basis of taxation of payments to such Lender or Issuing Bank in respect thereof (except for Indemnified Taxes or Other Taxes covered by Section 5.9 and the imposition of, or any change in the rate of, any
Excluded Tax payable by such Lender or Issuing Bank); or 
 (c) impose on any Lender or Issuing Bank or the London interbank
market any other condition, cost or expense affecting any Loan, Loan Document, Letter of Credit or participation in LC Obligations; 
 and the
result thereof shall be to increase the cost to such Lender of making or maintaining any LIBOR Loan (or of maintaining its obligation to make any such Loan), or to increase the cost to such Lender or Issuing Bank of participating in, issuing or
maintaining any Letter of Credit (or of maintaining its obligation to participate in or to issue any Letter of Credit), or to reduce the amount of any sum received or receivable by such Lender or Issuing Bank hereunder (whether of principal,
interest or any other amount) then, upon request of such Lender or Issuing Bank, Borrowers will pay to such Lender or Issuing Bank, as applicable, such additional amount or amounts as will compensate such Lender or Issuing Bank, as applicable, for
such additional costs incurred or reduction suffered. 
 3.7.2. Capital Adequacy. If any Lender or Issuing Bank
determines that any Change in Law affecting such Lender or Issuing Bank or any Lending Office of such Lender or such Lender’s or Issuing Bank’s holding company, if any, regarding capital requirements has or would have the effect of
reducing the rate of return on such Lender’s, Issuing Bank’s or holding company’s capital as a consequence of this Agreement, or such Lender’s or Issuing Bank’s Commitments, Loans, Letters of Credit or participations in LC
Obligations, to a level below that which such Lender, Issuing Bank or holding company could have achieved but for such Change in Law (taking into consideration such Lender’s, Issuing Bank’s and holding company’s policies with respect
to capital adequacy), then from time to time Borrowers will pay to such Lender or Issuing Bank, as the case may be, such additional amount or amounts as will compensate it or its holding company for any such reduction suffered. 

3.7.3. Compensation. Failure or delay on the part of any Lender or Issuing Bank to demand compensation pursuant to this Section
shall not constitute a waiver of its right to demand such compensation, but Borrowers shall not be required to compensate a Lender or Issuing Bank for any increased costs incurred or reductions suffered more than nine months prior to the date that
the Lender or Issuing Bank notifies Borrower Agent of the Change in Law giving rise to such increased costs or reductions and of such Lender’s or Issuing Bank’s intention to claim compensation therefor (except that, if the Change in Law
giving rise to such increased costs or reductions is retroactive, then the nine-month period referred to above shall be extended to include the period of retroactive effect thereof). 
  

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 3.8. Mitigation. If any Lender gives a notice under Section 3.5 or
requests compensation under Section 3.7, or if Borrowers are required to pay additional amounts with respect to a Lender under Section 5.9, then such Lender shall use reasonable efforts to designate a different Lending Office
or to assign its rights and obligations hereunder to another of its offices, branches or Affiliates, if, in the judgment of such Lender, such designation or assignment (a) would eliminate the need for such notice or reduce amounts payable or to
be withheld in the future, as applicable; and (b) would not subject the Lender to any unreimbursed cost or expense and would not otherwise be disadvantageous to it. Borrowers shall pay all reasonable costs and expenses incurred by any Lender in
connection with any such designation or assignment. 
 3.9. Funding Losses. If for any reason (other than default
by a Lender) (a) any Borrowing of, or conversion to or continuation of, a LIBOR Loan does not occur on the date specified therefor in a Notice of Borrowing or Notice of Conversion/Continuation (whether or not withdrawn), (b) any repayment
or conversion of a LIBOR Loan occurs on a day other than the end of its Interest Period, or (c) Borrowers fail to repay a LIBOR Loan when required hereunder, then Borrowers shall pay to Agent its customary administrative charge and to each
Lender all losses and expenses that it sustains as a consequence thereof, including loss of anticipated profits and any loss or expense arising from liquidation or redeployment of funds or from fees payable to terminate deposits of matching funds.
Lenders shall not be required to purchase Dollar deposits in the London interbank market or any other offshore Dollar market to fund any LIBOR Loan, but the provisions hereof shall be deemed to apply as if each Lender had purchased such deposits to
fund its LIBOR Loans. 
 3.10. Maximum Interest. Notwithstanding anything to the contrary contained in any Loan
Document, the interest paid or agreed to be paid under the Loan Documents shall not exceed the maximum rate of non-usurious interest permitted by Applicable Law (“maximum rate”). If Agent or any Lender shall receive interest in an amount
that exceeds the maximum rate, the excess interest shall be applied to the principal of the Obligations or, if it exceeds such unpaid principal, refunded to Borrowers. In determining whether the interest contracted for, charged or received by Agent
or a Lender exceeds the maximum rate, such Person may, to the extent permitted by Applicable Law, (a) characterize any payment that is not principal as an expense, fee or premium rather than interest; (b) exclude voluntary prepayments and
the effects thereof; and (c) amortize, prorate, allocate and spread in equal or unequal parts the total amount of interest throughout the contemplated term of the Obligations hereunder. 
 SECTION 4. LOAN ADMINISTRATION 
 4.1. Manner of Borrowing and
Funding Revolver Loans. 
 4.1.1. Notice of Borrowing. 

(a) Whenever Borrowers desire funding of a Borrowing of Revolver Loans, Borrower Agent shall give Agent a Notice of Borrowing. Such notice
must be received by Agent no later than 11:00 a.m. (i) on the Business Day of the requested funding date, in the case of Base Rate Loans, and (ii) at least three Business Days prior to the requested funding date, in the case of LIBOR
Loans. Notices received after 11:00 a.m. shall be deemed received on the next Business Day. Each Notice of Borrowing shall be irrevocable and shall specify (A) the amount of the Borrowing, (B) the requested funding date (which must be a
Business Day), (C) whether the Borrowing is to be made as Base Rate Loans or LIBOR Loans, and (D) in the case of LIBOR Loans, the duration of the applicable Interest Period (which shall be deemed to be 30 days if not specified).

 (b) Unless payment is otherwise timely made by Borrowers, the becoming due of any Obligations (whether principal, interest,
fees or other charges, including Extraordinary Expenses, LC Obligations, Cash Collateral and Bank Product Debt) shall be deemed to be a request for Base Rate Revolver Loans on the due date, in the amount of such Obligations. The proceeds of such
Revolver 
  

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Loans shall be disbursed as direct payment of the relevant Obligation. In addition, Agent may, at its option, charge such Obligations against any operating, investment or other account of a
Borrower maintained with Agent or any of its Affiliates. 
 (c) If Borrowers establish a controlled disbursement account with
Agent or any Affiliate of Agent, then the presentation for payment of any check or other item of payment drawn on such account at a time when there are insufficient funds to cover it shall be deemed to be a request for Base Rate Revolver Loans on
the date of such presentation, in the amount of the check and items presented for payment. The proceeds of such Revolver Loans may be disbursed directly to the controlled disbursement account or other appropriate account. 

4.1.2. Fundings by Lenders. Each Lender shall timely honor its Revolver Commitment by funding its Pro Rata share of each Borrowing
of Revolver Loans that is properly requested hereunder. Except for Borrowings to be made as Swingline Loans, Agent shall endeavor to notify Lenders of each Notice of Borrowing (or deemed request for a Borrowing) by 12:00 noon on the proposed funding
date for Base Rate Loans or by 3:00 p.m. at least two Business Days before any proposed funding of LIBOR Loans. Each Lender shall fund to Agent such Lender’s Pro Rata share of the Borrowing to the account specified by Agent in immediately
available funds not later than 2:00 p.m. on the requested funding date, unless Agent’s notice is received after the times provided above, in which event Lender shall fund its Pro Rata share by 11:00 a.m. on the next Business Day. Subject to its
receipt of such amounts from Lenders, Agent shall disburse the proceeds of the Revolver Loans as directed by Borrower Agent. Unless Agent shall have received (in sufficient time to act) written notice from a Lender that it does not intend to fund
its Pro Rata share of a Borrowing, Agent may assume that such Lender has deposited or promptly will deposit its share with Agent, and Agent may disburse a corresponding amount to Borrowers. If a Lender’s share of any Borrowing or of any
settlement pursuant to Section 4.1.3(b) is not received by Agent, then Borrowers agree to repay to Agent on demand the amount of such share, together with interest thereon from the date disbursed until repaid, at the rate
applicable to the Borrowing. 
 4.1.3. Swingline Loans; Settlement. 

(a) Agent may, but shall not be obligated to, advance Swingline Loans to Borrowers, up to an aggregate outstanding amount of $15,000,000,
unless the funding is specifically required to be made by all Lenders hereunder. Each Swingline Loan shall constitute a Revolver Loan for all purposes, except that payments thereon shall be made to Agent for its own account. The obligation of
Borrowers to repay Swingline Loans shall be evidenced by the records of Agent and need not be evidenced by any promissory note. 

(b) To facilitate administration of the Revolver Loans, Lenders and Agent agree (which agreement is solely among them, and not for the
benefit of or enforceable by any Borrower) that settlement among them with respect to Swingline Loans and other Revolver Loans may take place on a date determined from time to time by Agent, which shall occur at least once each week. On each
settlement date, settlement shall be made with each Lender in accordance with the Settlement Report delivered by Agent to Lenders. Between settlement dates, Agent may in its discretion apply payments on Revolver Loans to Swingline Loans, regardless
of any designation by Borrower or any provision herein to the contrary. Each Lender’s obligation to make settlements with Agent is absolute and unconditional, without offset, counterclaim or other defense, and whether or not the Commitments
have terminated, an Overadvance exists or the conditions in Section 6 are satisfied. If, due to an Insolvency Proceeding with respect to a Borrower or otherwise, any Swingline Loan may not be settled among Lenders hereunder, then each
Lender shall be deemed to have purchased from Agent a Pro Rata participation in each unpaid Swingline Loan and shall transfer the amount of such participation to Agent, in immediately available funds, within one Business Day after Agent’s
request therefor. 
  

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 4.1.4. Notices. Each Borrower authorizes Agent and Lenders to extend, convert or
continue Loans, effect selections of interest rates, and transfer funds to or on behalf of Borrowers based on telephonic or e-mailed instructions. Borrowers shall confirm each such request by prompt delivery to Agent of a Notice of Borrowing or
Notice of Conversion/Continuation, if applicable, but if it differs in any material respect from the action taken by Agent or Lenders, the records of Agent and Lenders shall govern. Neither Agent nor any Lender shall have any liability for any loss
suffered by a Borrower as a result of Agent or any Lender acting upon its understanding of telephonic or e-mailed instructions from a person believed in good faith by Agent or any Lender to be a person authorized to give such instructions on a
Borrower’s behalf. 
 4.2. Defaulting Lender. Agent may (but shall not be required to), in its discretion,
retain any payments or other funds received by Agent that are to be provided to a Defaulting Lender hereunder, and may apply such funds to such Lender’s defaulted obligations or readvance the funds to Borrowers in accordance with this
Agreement. The failure of any Lender to fund a Loan, to make any payment in respect of LC Obligations or to otherwise perform its obligations hereunder shall not relieve any other Lender of its obligations, and no Lender shall be responsible for
default by another Lender. Lenders and Agent agree (which agreement is solely among them, and not for the benefit of or enforceable by any Borrower) that, solely for purposes of determining a Defaulting Lender’s right to vote on matters
relating to the Loan Documents and to share in payments, fees and Collateral proceeds thereunder, a Defaulting Lender shall not be deemed to be a “Lender” until all its defaulted obligations have been cured. 

4.3. Number and Amount of LIBOR Loans; Determination of Rate. Each Borrowing of LIBOR Loans when made shall be in a minimum
amount of $1,000,000, plus any increment of $1,000,000 in excess thereof. No more than 10 Borrowings of LIBOR Loans may be outstanding at any time, and all LIBOR Loans having the same length and beginning date of their Interest Periods shall be
aggregated together and considered one Borrowing for this purpose. Upon determining LIBOR for any Interest Period requested by Borrowers, Agent shall promptly notify Borrowers thereof by telephone or electronically and, if requested by Borrowers,
shall confirm any telephonic notice in writing. 
 4.4. Borrower Agent. Each Borrower hereby designates Clearwater
(“Borrower Agent”) as its representative and agent for all purposes under the Loan Documents, including requests for Loans and Letters of Credit, designation of interest rates, delivery or receipt of communications, preparation and
delivery of Borrowing Base and financial reports, receipt and payment of Obligations, requests for waivers, amendments or other accommodations, actions under the Loan Documents (including in respect of compliance with covenants), and all other
dealings with Agent, Issuing Bank or any Lender. Borrower Agent hereby accepts such appointment. Agent and Lenders shall be entitled to rely upon, and shall be fully protected in relying upon, any notice or communication (including any notice of
borrowing) delivered by Borrower Agent on behalf of any Borrower. Agent and Lenders may give any notice or communication with a Borrower hereunder to Borrower Agent on behalf of such Borrower. Each of Agent, Issuing Bank and Lenders shall have the
right, in its discretion, to deal exclusively with Borrower Agent for any or all purposes under the Loan Documents. Each Borrower agrees that any notice, election, communication, representation, agreement or undertaking made on its behalf by
Borrower Agent shall be binding upon and enforceable against it. 
 4.5. One Obligation. The Loans, LC Obligations
and other Obligations shall constitute one general obligation of Borrowers and (unless otherwise expressly provided in any Loan Document) shall be secured by Agent’s Lien upon all Collateral; provided, however, that Agent and each
Lender shall be deemed to be a creditor of, and the holder of a separate claim against, each Borrower to the extent of any Obligations jointly or severally owed by such Borrower. 

4.6. Effect of Termination. On the effective date of any termination of the Commitments, all Obligations shall be
immediately due and payable, and any Borrower or any Lender may terminate its and its Affiliates’ Bank Products (including, only with the consent of Agent, any Cash Management Services). All undertakings of Borrowers contained in the Loan
Documents shall survive any termination, and Agent 
  

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shall retain its Liens in the Collateral and all of its rights and remedies under the Loan Documents until Full Payment of the Obligations. Notwithstanding Full Payment of the Obligations, Agent
shall not be required to terminate its Liens in any Collateral unless, with respect to any damages Agent may incur as a result of the dishonor or return of Payment Items applied to Obligations, Agent receives (a) a written agreement, executed
by Borrowers and any Person whose advances are used in whole or in part to satisfy the Obligations, indemnifying Agent and Lenders from any such damages; or (b) such Cash Collateral as Agent, in its discretion, deems necessary to protect
against any such damages. Sections 2.3, 3.4, 3.6, 3.7, 3.9, 5.5, 5.9, 5.10, 12, 14.2 and this Section, and the obligation of each Obligor and Lender with respect to each indemnity given by it in any Loan Document, shall survive Full
Payment of the Obligations and any release relating to this credit facility. 
 SECTION 5. PAYMENTS 

5.1. General Payment Provisions. All payments of Obligations shall be made in Dollars, without offset, counterclaim or
defense of any kind, free of (and without deduction for) any Taxes, and in immediately available funds, not later than 12:00 noon on the due date. Any payment after such time shall be deemed made on the next Business Day. Any payment of a LIBOR Loan
prior to the end of its Interest Period shall be accompanied by all amounts due under Section 3.9. Any prepayment of Loans shall be applied first to Base Rate Loans and then to LIBOR Loans. 

5.2. Repayment of Revolver Loans. Revolver Loans shall be due and payable in full on the Revolver Termination Date, unless
payment is sooner required hereunder. Revolver Loans may be prepaid from time to time, without penalty or premium. If any Asset Disposition during any Trigger Period includes the disposition of Accounts or Inventory, then Net Proceeds equal to the
greater of (a) the net book value of such Accounts and Inventory, or (b) the reduction in the Borrowing Base upon giving effect to such disposition, shall be applied to the Revolver Loans. Notwithstanding anything herein to the contrary,
if an Overadvance exists, Borrowers shall, on the sooner of Agent’s demand or the first Business Day after any Borrower has knowledge thereof, repay the outstanding Revolver Loans in an amount sufficient to reduce the principal balance of
Revolver Loans to the Borrowing Base. 
 5.3. Intentionally Omitted. 

5.4. Payment of Other Obligations. Obligations other than Loans, including LC Obligations and Extraordinary Expenses, shall
be paid by Borrowers as provided in the Loan Documents or, if no payment date is specified, on demand. 
 5.5.
Marshaling; Payments Set Aside. None of Agent or Lenders shall be under any obligation to marshal any assets in favor of any Obligor or against any Obligations. If any payment by or on behalf of Borrowers is made to Agent, Issuing Bank or
any Lender, or Agent, Issuing Bank or any Lender exercises a right of setoff, and such payment or the proceeds of such setoff or any part thereof is subsequently invalidated, declared to be fraudulent or preferential, set aside or required
(including pursuant to any settlement entered into by Agent, Issuing Bank or such Lender in its discretion) to be repaid to a trustee, receiver or any other Person, then to the extent of such recovery, the Obligation originally intended to be
satisfied, and all Liens, rights and remedies relating thereto, shall be revived and continued in full force and effect as if such payment had not been made or such setoff had not occurred. 

5.6. Post-Default Allocation of Payments. 
 5.6.1. Allocation. Notwithstanding anything herein to the contrary, during an Event of Default, monies to be applied to the Obligations, whether arising from payments by Obligors, realization on
Collateral, setoff or otherwise, shall be allocated as follows: 
 (a) first, to all costs and expenses, including
Extraordinary Expenses, owing to Agent; 
  

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 (b) second, to all amounts owing to Agent on Swingline Loans; 

(c) third, to all amounts owing to Issuing Bank on LC Obligations; 

(d) fourth, to all Obligations constituting fees (excluding amounts relating to Bank Products); 

(e) fifth, to all Obligations constituting interest (excluding amounts relating to Bank Products); 

(f) sixth, to provide Cash Collateral for outstanding Letters of Credit; 

(g) seventh, to all other Obligations, other than Bank Product Debt; and 

(h) last, to Bank Product Debt. 
 Amounts shall be applied to each category of Obligations set forth above until Full Payment thereof and then to the next category. If amounts are insufficient to satisfy a category, they shall be applied
on a pro rata basis among the Obligations in the category. Amounts distributed with respect to any Bank Product Debt shall be the lesser of the applicable Bank Product Amount last reported to Agent or the actual Bank Product Debt as calculated by
the methodology reported to Agent for determining the amount due. Agent shall have no obligation to calculate the amount to be distributed with respect to any Bank Product Debt, but may rely upon written notice of the amount (setting forth a
reasonably detailed calculation) from the Secured Party. In the absence of such notice, Agent may assume the amount to be distributed is the Bank Product Amount last reported to it. The allocations set forth in this Section are solely to determine
the rights and priorities of Agent and Lenders as among themselves, and may be changed by agreement among them without the consent of any Obligor. This Section is not for the benefit of or enforceable by any Borrower. 

5.6.2. Erroneous Application. Agent shall not be liable for any application of amounts made by it in good faith and, if any such
application is subsequently determined to have been made in error, the sole recourse of any Lender or other Person to which such amount should have been made shall be to recover the amount from the Person that actually received it (and, if such
amount was received by any Lender, such Lender hereby agrees to return it). 
 5.7. Application of Payments. The
ledger balance in the main Dominion Account as of the end of a Business Day shall be applied to the Obligations at the beginning of the next Business Day, during any Trigger Period. If, as a result of such application, a credit balance exists, the
balance shall not accrue interest in favor of Borrowers and, as long as no Default or Event of Default exists, such credit balance shall be remitted by Agent as soon as practicable to the Deposit Account directed by Borrower Agent in writing from
time to time. Each Borrower irrevocably waives the right to direct the application of any payments or Collateral proceeds, and agrees that Agent shall have the continuing, exclusive right to apply and reapply same against the Obligations, in such
manner as Agent deems advisable. 
 5.8. Loan Account; Account Stated. 

5.8.1. Loan Account. Agent shall maintain in accordance with its usual and customary practices an account or accounts
(“Loan Account”) evidencing the Debt of Borrowers resulting from each Loan or issuance of a Letter of Credit from time to time. Any failure of Agent to record anything in the Loan Account, or any error in doing so, shall not limit
or otherwise affect the obligation of Borrowers to pay any amount owing hereunder. Agent may maintain a single Loan Account in the name of Borrower Agent, and each Borrower confirms that such arrangement shall have no effect on the joint and several
character of its liability for the Obligations. 
  

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 5.8.2. Entries Binding. Entries made in the Loan Account shall constitute presumptive
evidence of the information contained therein. If any information contained in the Loan Account is provided to or inspected by any Person, then such information shall be conclusive and binding on such Person for all purposes absent manifest error,
except to the extent such Person notifies Agent in writing within 30 days after receipt or inspection that specific information is subject to dispute. 
 5.9. Taxes. 
 5.9.1. Payments Free of Taxes. All payments by
Obligors of Obligations shall be free and clear of and without reduction for any Taxes. If Applicable Law requires any Obligor or Agent to withhold or deduct any Tax (including backup withholding or withholding Tax), the withholding or deduction
shall be based on information provided pursuant to Section 5.10 and Agent shall pay the amount withheld or deducted to the relevant Governmental Authority. If the withholding or deduction is made on account of Indemnified Taxes or Other
Taxes, the sum payable by Borrowers shall be increased so that Agent, Lender or Issuing Bank, as applicable, receives an amount equal to the sum it would have received if no such withholding or deduction (including deductions applicable to
additional sums payable under this Section) had been made. Without limiting the foregoing, Borrowers shall timely pay all Other Taxes to the relevant Governmental Authorities. 
 5.9.2. Payment. Borrowers shall indemnify, hold harmless and reimburse (within 10 days after demand therefor) Agent, Lenders and Issuing Bank for any Indemnified Taxes or Other Taxes (including
those attributable to amounts payable under this Section) withheld or deducted by any Obligor or Agent, or paid by Agent, any Lender or Issuing Bank, with respect to any Obligations, Letters of Credit or Loan Documents, whether or not such Taxes
were properly asserted by the relevant Governmental Authority, and including all penalties, interest and reasonable expenses relating thereto, as well as any amount that a Lender or Issuing Bank fails to pay indefeasibly to Agent under
Section 5.10. A certificate as to the amount of any such payment or liability delivered to Borrower Agent by Agent, or by a Lender or Issuing Bank (with a copy to Agent), shall be conclusive, absent manifest error. As soon as practicable
after any payment of Taxes by a Borrower, Borrower Agent shall deliver to Agent a receipt from the Governmental Authority or other evidence of payment satisfactory to Agent. 
 5.10. Lender Tax Information. 
 5.10.1. Status of Lenders.
Each Lender shall deliver documentation and information to Agent and Borrower Agent, at the times and in form required by Applicable Law or reasonably requested by Agent or Borrower Agent, sufficient to permit Agent or Borrowers to determine
(a) whether or not payments made with respect to Obligations are subject to Taxes, (b) if applicable, the required rate of withholding or deduction, and (c) such Lender’s entitlement to any available exemption from, or reduction
of, applicable Taxes for such payments or otherwise to establish such Lender’s status for withholding tax purposes in the applicable jurisdiction. 
 5.10.2. Documentation. If a Borrower is resident for tax purposes in the United States, any Lender that is a “United States person” within the meaning of section 7701(a)(30) of the Code
shall deliver to Agent and Borrower Agent IRS Form W-9 or such other documentation or information prescribed by Applicable Law or reasonably requested by Agent or Borrower Agent to determine whether such Lender is subject to backup withholding or
information reporting requirements. If any Foreign Lender is entitled to any exemption from or reduction of withholding tax for payments with respect to the Obligations, it shall deliver to Agent and Borrower Agent, on or prior to the date on which
it becomes a Lender hereunder (and from time to time thereafter upon request by Agent or Borrower Agent, but only if such Foreign Lender is legally entitled to do so), (a) IRS Form W-8BEN claiming eligibility for benefits of an income tax
treaty to which the United States is a party; (b) IRS Form W-8ECI; (c) IRS Form W-8IMY 
  

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and all required supporting documentation; (d) in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under section 881(c) of the Code, IRS Form W-8BEN
and a certificate showing such Foreign Lender is not (i) a “bank” within the meaning of section 881(c)(3)(A) of the Code, (ii) a “10 percent shareholder” of any Obligor within the meaning of section 881(c)(3)(B) of the
Code, or (iii) a “controlled foreign corporation” described in section 881(c)(3)(C) of the Code; or (e) any other form prescribed by Applicable Law as a basis for claiming exemption from or a reduction in withholding tax,
together with such supplementary documentation necessary to allow Agent and Borrowers to determine the withholding or deduction required to be made. 
 5.10.3. Lender Obligations. Each Lender and Issuing Bank shall promptly notify Borrowers and Agent of any change in circumstances that would change any claimed Tax exemption or reduction. Each
Lender and Issuing Bank shall indemnify, hold harmless and reimburse (within 10 days after demand therefor) Borrowers and Agent for any Taxes, losses, claims, liabilities, penalties, interest and expenses (including reasonable attorneys’ fees)
incurred by or asserted against a Borrower or Agent by any Governmental Authority due to such Lender’s or Issuing Bank’s failure to deliver, or inaccuracy or deficiency in, any documentation required to be delivered by it pursuant to this
Section. Each Lender and Issuing Bank authorizes Agent to set off any amounts due to Agent under this Section against any amounts payable to such Lender or Issuing Bank under any Loan Document. 

5.11. Nature and Extent of Each Borrower’s Liability. 

5.11.1. Joint and Several Liability. Each Borrower agrees that it is jointly and severally liable for, and absolutely and
unconditionally guarantees to Agent and Lenders the prompt payment and performance of, all Obligations and all agreements under the Loan Documents. Each Borrower agrees that its guaranty obligations hereunder constitute a continuing guaranty of
payment and not of collection, that such obligations shall not be discharged until Full Payment of the Obligations, and that such obligations are absolute and unconditional, irrespective of (a) the genuineness, validity, regularity,
enforceability, subordination or any future modification of, or change in, any Obligations or Loan Document, or any other document, instrument or agreement to which any Obligor is or may become a party or be bound; (b) the absence of any action
to enforce this Agreement (including this Section) or any other Loan Document, or any waiver, consent or indulgence of any kind by Agent or any Lender with respect thereto; (c) the existence, value or condition of, or failure to perfect a Lien
or to preserve rights against, any security or guaranty for the Obligations or any action, or the absence of any action, by Agent or any Lender in respect thereof (including the release of any security or guaranty); (d) the insolvency of any
Obligor; (e) any election by Agent or any Lender in an Insolvency Proceeding for the application of Section 1111(b)(2) of the Bankruptcy Code; (f) any borrowing or grant of a Lien by any other Borrower, as debtor-in-possession under
Section 364 of the Bankruptcy Code or otherwise; (g) the disallowance of any claims of Agent or any Lender against any Obligor for the repayment of any Obligations under Section 502 of the Bankruptcy Code or otherwise; or (h) any
other action or circumstances that might otherwise constitute a legal or equitable discharge or defense of a surety or guarantor, except Full Payment of all Obligations. 
 5.11.2. Waivers. 
 (a) Each Borrower expressly waives all rights that it may
have now or in the future under any statute, at common law, in equity or otherwise, to compel Agent or Lenders to marshal assets or to proceed against any Obligor, other Person or security for the payment or performance of any Obligations before, or
as a condition to, proceeding against such Borrower. Each Borrower waives all defenses available to a surety, guarantor or accommodation co-obligor other than Full Payment of all Obligations. It is agreed among each Borrower, Agent and Lenders that
the provisions of this Section 5.11 are of the essence of the transaction contemplated by the Loan Documents and that, but for such provisions, Agent and Lenders would decline to make Loans and issue Letters of Credit. Each Borrower
acknowledges that its guaranty pursuant to this Section is necessary to the conduct and promotion of its business, and can be expected to benefit such business. 
  

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 (b) Agent and Lenders may, in their discretion, pursue such rights and remedies as they deem
appropriate, including realization upon Collateral by judicial foreclosure or non-judicial sale or enforcement, without affecting any rights and remedies under this Section 5.11. If, in taking any action in connection with the exercise
of any rights or remedies, Agent or any Lender shall forfeit any other rights or remedies, including the right to enter a deficiency judgment against any Borrower or other Person, whether because of any Applicable Laws pertaining to “election
of remedies” or otherwise, each Borrower consents to such action and waives any claim based upon it, even if the action may result in loss of any rights of subrogation that any Borrower might otherwise have had. Any election of remedies that
results in denial or impairment of the right of Agent or any Lender to seek a deficiency judgment against any Borrower shall not impair any other Borrower’s obligation to pay the full amount of the Obligations. Each Borrower waives all rights
and defenses arising out of an election of remedies, such as nonjudicial foreclosure with respect to any security for the Obligations, even though that election of remedies destroys such Borrower’s rights of subrogation against any other
Person. Agent may bid all or a portion of the Obligations at any foreclosure or trustee’s sale or at any private sale, and the amount of such bid need not be paid by Agent but shall be credited against the Obligations. The amount of the
successful bid at any such sale, whether Agent or any other Person is the successful bidder, shall be conclusively deemed to be the fair market value of the Collateral, and the difference between such bid amount and the remaining balance of the
Obligations shall be conclusively deemed to be the amount of the Obligations guaranteed under this Section 5.11, notwithstanding that any present or future law or court decision may have the effect of reducing the amount of any
deficiency claim to which Agent or any Lender might otherwise be entitled but for such bidding at any such sale. 
 5.11.3.
Extent of Liability; Contribution. 
 (a) Notwithstanding anything herein to the contrary, each Borrower’s liability
under this Section 5.11 shall be limited to the greater of (i) all amounts for which such Borrower is primarily liable, as described below, and (ii) such Borrower’s Allocable Amount. 

(b) If any Borrower makes a payment under this Section 5.11 of any Obligations (other than amounts for which such Borrower is
primarily liable) (a “Guarantor Payment”) that, taking into account all other Guarantor Payments previously or concurrently made by any other Borrower, exceeds the amount that such Borrower would otherwise have paid if each Borrower
had paid the aggregate Obligations satisfied by such Guarantor Payments in the same proportion that such Borrower’s Allocable Amount bore to the total Allocable Amounts of all Borrowers, then such Borrower shall be entitled to receive
contribution and indemnification payments from, and to be reimbursed by, each other Borrower for the amount of such excess, pro rata based upon their respective Allocable Amounts in effect immediately prior to such Guarantor Payment. The
“Allocable Amount” for any Borrower shall be the maximum amount that could then be recovered from such Borrower under this Section 5.11 without rendering such payment voidable under Section 548 of the Bankruptcy
Code or under any applicable state fraudulent transfer or conveyance act, or similar statute or common law. 
 (c) Nothing
contained in this Section 5.11 shall limit the liability of any Borrower to pay Loans made directly or indirectly to that Borrower (including Loans advanced to any other Borrower and then re-loaned or otherwise transferred to, or for the
benefit of, such Borrower), LC Obligations relating to Letters of Credit issued to support such Borrower’s business, and all accrued interest, fees, expenses and other related Obligations with respect thereto, for which such Borrower shall be
primarily liable for all purposes hereunder. Agent and Lenders shall have the right, at any time in their discretion, to condition Loans and Letters of Credit upon a separate calculation of borrowing availability for each Borrower and to restrict
the disbursement and use of such Loans and Letters of Credit to such Borrower. 
  

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 5.11.4. Joint Enterprise. Each Borrower has requested that Agent and Lenders make
this credit facility available to Borrowers on a combined basis, in order to finance Borrowers’ business most efficiently and economically. Borrowers’ business is a mutual and collective enterprise, and Borrowers believe that consolidation
of their credit facility will enhance the borrowing power of each Borrower and ease the administration of their relationship with Lenders, all to the mutual advantage of Borrowers. Borrowers acknowledge and agree that Agent’s and Lenders’
willingness to extend credit to Borrowers and to administer the Collateral on a combined basis, as set forth herein, is done solely as an accommodation to Borrowers and at Borrowers’ request. 

5.11.5. Subordination. Each Borrower hereby subordinates any claims, including any rights at law or in equity to payment,
subrogation, reimbursement, exoneration, contribution, indemnification or set off, that it may have at any time against any other Obligor, howsoever arising, to the Full Payment of all Obligations. 

SECTION 6. CONDITIONS PRECEDENT 
 6.1. Conditions Precedent to Initial Loans. In addition to the conditions set forth in Section 6.2, Lenders shall not be required to fund any requested Loan, issue any Letter of
Credit, or otherwise extend credit to Borrowers hereunder, until the date (“Closing Date”) that each of the following conditions has been satisfied: 
 (a) Notes shall have been executed by Borrowers and delivered to each Lender that requests issuance of a Note. Each other Loan Document shall have been duly executed and delivered to Agent by each of the
signatories thereto, and each Obligor shall be in compliance with all terms thereof. 
 (b) Agent shall have received
acknowledgments of all filings or recordations necessary to perfect its Liens in the Collateral, as well as UCC and Lien searches and other evidence satisfactory to Agent that such Liens are the only Liens upon the Collateral, except Permitted
Liens. 
 (c) Agent shall have received duly executed agreements establishing each Dominion Account and related lockbox, in form
and substance satisfactory to Agent. 
 (d) Agent shall have received certificates, in form and substance satisfactory to it,
from a knowledgeable Senior Officer of each Borrower certifying that, after giving effect to the initial Loans and transactions hereunder, (i) such Borrower is Solvent; (ii) no Default or Event of Default exists; (iii) the
representations and warranties set forth in Section 9 are true and correct; and (iv) such Borrower has complied with all agreements and conditions to be satisfied by it under the Loan Documents. 

(e) Agent shall have received a certificate of a duly authorized officer of each Obligor, certifying (i) that attached copies of
such Obligor’s Organic Documents are true and complete, and in full force and effect, without amendment except as shown; (ii) that an attached copy of resolutions authorizing execution and delivery of the Loan Documents is true and
complete, and that such resolutions are in full force and effect, were duly adopted, have not been amended, modified or revoked, and constitute all resolutions adopted with respect to this credit facility; and (iii) to the title, name and
signature of each Person authorized to sign the Loan Documents. Agent may conclusively rely on this certificate until it is otherwise notified by the applicable Obligor in writing. 

(f) Agent shall have received a written opinion of Pillsbury Winthrop Shaw Pittman LLP, in form and substance satisfactory to Agent.

 (g) Agent shall have received copies of the charter documents of each Obligor, certified by the Secretary of State or other
appropriate official of such Obligor’s jurisdiction of organization. Agent shall have received good standing certificates for each Obligor, issued by the Secretary of State or other appropriate official of such Obligor’s jurisdiction of
organization and each jurisdiction where such Obligor’s conduct of business or ownership of Property necessitates qualification. 
  

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 (h) Agent shall have received copies of policies or certificates of insurance for the
insurance policies carried by Borrowers, all in compliance with the Loan Documents, together with endorsements naming Agent as lender loss payee or additional insured, as appropriate, each in form and substance satisfactory to Agent. 

(i) Agent shall have completed its business, financial and legal due diligence of Obligors, including a roll-forward of its previous
field examination, with results satisfactory to Agent. No material adverse change in the business, operations, Properties, prospects or condition (financial or otherwise) of any Obligor or in the quality, quantity or value of any Collateral shall
have occurred since December 31, 2007. 
 (j) Borrowers shall have paid all fees and expenses to be paid to Agent and
Lenders on the Closing Date. 
 (k) Agent shall have received, each in form and substance satisfactory to Agent, (i) a pro
forma balance sheet of Borrowers dated as of the Closing Date and giving effect to the consummation of the Spin-Off and the retention of the Potlatch Indebtedness, (ii) financial projections of the Borrowers, evidencing each Borrower’s
ability to comply with the financial covenants set forth herein, and (c) interim financial statements for the Borrowers as of a date not more than 30 days prior to the Closing Date. 

(l) Agent shall have received duly executed copies of the Spin-Off Documents, the terms and conditions of which shall be satisfactory to
Agent. 
 (m) Agent shall have received all documents, instruments and other agreements related to or executed in connection
with the Potlatch Indebtedness, the terms and conditions of which shall be satisfactory to Agent. 
 (n) Agent shall have
received evidence, in form and substance satisfactory to Agent, that (i) the “Separation” (as defined in the Separation Agreement) shall have occurred, (ii) Clearwater and its Subsidiaries have taken all actions and proceedings
required by the Separation Agreement, applicable law and regulation for the “Distribution” (as defined in the Separation Agreement) to occur, and (iii) no further action on the part of any Person or Governmental Authority shall be
necessary for the consummation of Spin-Off, other than the transfer by Clearwater of $50,000,000 to Retainco prior to the “Distribution” (as defined in the Separation Agreement). 

(o) There shall exist no action, suit, investigation, litigation or proceeding pending or threatened in any court or before any
arbitrator or governmental instrumentality that in Agent’s good faith judgment (i) could reasonably be expected to have a material adverse effect on any Borrower’s business, assets, properties, liabilities, operations, condition or
prospects, or could impair any Borrower’s ability to perform satisfactorily under this Agreement and the other Loan Documents; or (ii) could reasonably be expected to materially and adversely affect this Agreement, the Spin-Off Documents,
or the transactions contemplated hereby or thereby. 
 (p) No terms of Sections 7, 8, 9, 10, or 11 have been
violated between the date of this Agreement and the Closing Date. 
 (q) The Intercreditor Agreement shall have been duly
executed and delivered to Agent by each of the signatories thereto, and be in form and substance satisfactory to each Lender in their sole discretion. 
 (r) Agent shall have received a Borrowing Base Certificate prepared as of the 

 

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Closing Date. Upon giving effect to the initial funding of Loans and issuance of Letters of Credit, and the payment by Borrowers of all fees and expenses incurred in connection herewith as well
as any payables stretched beyond their customary payment practices, Availability shall be at least $50,000,000. 
 (s) The
initial Loans hereunder shall have been funded on or before February 28, 2009. 
 6.2. Conditions Precedent to All
Credit Extensions. Agent, Issuing Bank and Lenders shall not be required to fund any Loans, arrange for issuance of any Letters of Credit or grant any other accommodation to or for the benefit of Borrowers, unless the following
conditions are satisfied: 
 (a) No Default or Event of Default shall exist at the time of, or result from, such funding,
issuance or grant; 
 (b) The representations and warranties of each Obligor in the Loan Documents shall be true and correct on
the date of, and upon giving effect to, such funding, issuance or grant (except for representations and warranties that expressly relate to an earlier date); 
 (c) All conditions precedent in any other Loan Document shall be satisfied; 
 (d)
No event shall have occurred or circumstance exist that has or could reasonably be expected to have a Material Adverse Effect; and 
 (e) With respect to issuance of a Letter of Credit, the LC Conditions shall be satisfied. 
 Each
request (or deemed request) by Borrowers for funding of a Loan, issuance of a Letter of Credit or grant of an accommodation shall constitute a representation by Borrowers that the foregoing conditions are satisfied on the date of such request and on
the date of such funding, issuance or grant. As an additional condition to any funding, issuance or grant, Agent shall have received such other information, documents, instruments and agreements as it deems appropriate in connection therewith.

 6.3. Conditions Precedent Effectiveness of Certain Sections. Sections 7, 8, 9, 10, and 11
shall not be effective until the conditions precedent in Sections 6.1 and 6.2 have been satisfied or waived, and the Lenders are prepared to fund the initial Loans (for the avoidance of doubt, at any rate such Sections shall become
effective no later than the funding of the initial Loans hereunder). 
 SECTION 7. COLLATERAL 

7.1. Grant of Security Interest. 
 7.1.1. To secure the prompt payment and performance of all Obligations, each Borrower hereby grants to Agent, for the benefit of Secured Parties, a continuing security interest in and Lien upon all of the
following Property of such Borrower, whether now owned or hereafter acquired, and wherever located: 
 (a) all Accounts;

 (b) all Deposit Accounts; 
 (c) all Inventory; 
 (d) all supporting obligations in respect of Accounts,
including letters of credit and guaranties issued in support of Accounts or Proceeds of Collateral; 
  

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 (e) all securities accounts to the extent of the Cash Equivalents contained therein that
were derived from Accounts, Inventory or Deposit Accounts; 
 (f) all certificates of title, documents or instruments evidencing
ownership or title to any of the Property described in Section 7.1.1(c) and (h); 
 (g) all monies, whether or not
in the possession or under the control of Agent, a Lender, or a bailee or Affiliate of Agent or a Lender that were derived from or consist of any of the Property described in this Section 7.1, and any Cash Collateral; 

(h) all accessions to, substitutions for, and all replacements, products, and cash and non-cash proceeds of the foregoing, including
proceeds of and unearned premiums with respect to insurance policies, and claims against any Person for loss, damage or destruction of any of the Property described in this Section 7.1 (the “Proceeds”); and 

(i) all books and records (including customer lists, files, correspondence, tapes, computer programs, print-outs and computer records)
pertaining to any of the Property described in this Section 7.1. 
 7.1.2. As security for the payment of all
License Rejection Liabilities, each Borrower hereby assigns to Agent, for the benefit of the Secured Parties, and grants to Agent, for the benefit of the Secured Parties, a continuing security interest in all of such Borrower’s Collateral
Related Intellectual Property, whether now or hereafter owned, existing, acquired or arising and wherever now or hereafter located. 
 7.1.3. Notwithstanding anything contained in this Section 7.1 to the contrary, Agent shall not have any security interest in the $50,000,000 transferred by Clearwater to Retainco on the
Closing Date in accordance with the Separation Agreement. 
 7.2. Lien on Deposit Accounts; Cash Collateral.

 7.2.1. Deposit Accounts. To further secure the prompt payment and performance of all Obligations, each Borrower hereby
grants to Agent, for the benefit of Secured Parties, a continuing security interest in and Lien upon all amounts credited to any Deposit Account of such Borrower, including any sums in any blocked or lockbox accounts or in any accounts into which
such sums are swept. Each Borrower hereby authorizes and directs each bank or other depository to deliver to Agent, upon request, all balances in any Deposit Account maintained by such Borrower, without inquiry into the authority or right of Agent
to make such request. 
 7.2.2. Cash Collateral. Any Cash Collateral may be invested, at Agent’s discretion, in Cash
Equivalents, but Agent shall have no duty to do so, regardless of any agreement or course of dealing with any Borrower, and shall have no responsibility for any investment or loss. Each Borrower hereby grants to Agent, for the benefit of Secured
Parties, a security interest in all Cash Collateral held from time to time and all proceeds thereof, as security for the Obligations, whether such Cash Collateral is held in a Cash Collateral Account or elsewhere. Agent may apply Cash Collateral to
the payment of any Obligations, in such order as Agent may elect, as they become due and payable. Each Cash Collateral Account and all Cash Collateral shall be under the sole dominion and control of Agent. No Borrower or other Person claiming
through or on behalf of any Borrower shall have any right to any Cash Collateral, until Full Payment of all Obligations. 

7.3. Intentionally Omitted. 
 7.4. Certain After-Acquired Collateral. Borrowers shall promptly notify Agent in writing if, after the Closing Date, any Borrower obtains any interest in any Collateral consisting of Deposit

  

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Accounts, Chattel Paper, Documents, Instruments, Investment Property or Letter-of-Credit Rights and, upon Agent’s request, shall promptly take such actions as Agent deems appropriate to
effect Agent’s duly perfected, first priority Lien upon such Collateral, including obtaining any appropriate possession, control agreement or Lien Waiver. If any Collateral is in the possession of a third party, at Agent’s request,
Borrowers shall obtain an acknowledgment that such third party holds the Collateral for the benefit of Agent. 
 7.5. No
Assumption of Liability. The Lien on Collateral granted hereunder is given as security only and shall not subject Agent or any Lender to, or in any way modify, any obligation or liability of Borrowers relating to any Collateral. 

7.6. Further Assurances. Promptly upon request, Borrowers shall deliver such instruments, assignments, title certificates,
or other documents or agreements, and shall take such actions, as Agent reasonably deems appropriate under Applicable Law to evidence or perfect its Lien on any Collateral, or otherwise to give effect to the intent of this Agreement. Each Borrower
authorizes Agent to file any financing statement that Agent deems reasonably desirable to preserve and perfect Agent’s security interest in the Collateral of such Borrower, and ratifies any action taken by Agent before the Closing Date to
effect or perfect its Lien on any Collateral. 
 SECTION 8. COLLATERAL ADMINISTRATION 

8.1. Borrowing Base Certificates. By the 20th day of each month, Borrowers shall deliver to Agent (and Agent shall
promptly deliver same to Lenders) a Borrowing Base Certificate prepared as of the close of business of the previous month, and at such other times as Agent may request; provided that during any Trigger Period, Borrowers shall be required to
deliver to Agent weekly Borrowing Base Certificates by the second Business Day of each week which begins during such Trigger Period. All calculations of Availability in any Borrowing Base Certificate shall originally be made by Borrowers and
certified by a Senior Officer, provided that Agent may from time to time review and adjust any such calculation (a) to reflect its reasonable estimate of declines in value of any Collateral, due to collections received in the Dominion Account
or otherwise; (b) to adjust advance rates to reflect changes in dilution, quality, mix and other factors affecting Collateral; and (c) to the extent the calculation is not made in accordance with this Agreement or does not accurately
reflect the Availability Reserve. 
 8.2. Administration of Accounts. 

8.2.1. Records and Schedules of Accounts. Each Borrower shall keep accurate and complete records of its Accounts, including all
payments and collections thereon, and shall submit to Agent sales, collection, reconciliation and other reports in form satisfactory to Agent, on such periodic basis as Agent may request. Each Borrower shall also provide to Agent, on or before the
20th day of each month, a detailed aged trial balance of all Accounts as of the end of the preceding month, specifying each Account’s Account Debtor name, amount, invoice date and due date, showing any credit, authorized return or dispute, and
upon request by Agent, including such proof of delivery, copies of invoices and invoice registers, copies of related documents, repayment histories, status reports and other information as Agent may reasonably request. If Accounts in an aggregate
face amount of $5,000,000 or more cease to be Eligible Accounts other than as a result of payment thereof, Borrowers shall notify Agent of such occurrence promptly (and in any event within one Business Day) after any Borrower has knowledge thereof.
Upon request by Agent, each Borrower shall provide to Agent a listing of each Account Debtor’s address. 
 8.2.2.
Taxes. If an Account of any Borrower includes a charge for any Taxes and an Event of Default has occurred and is continuing, Agent is authorized, in its discretion, to pay the amount thereof to the proper taxing authority for the account of
such Borrower and to charge Borrowers therefor; provided, however, that neither Agent nor Lenders shall be liable for any Taxes that may be due from Borrowers or with respect to any Collateral. 

 

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 8.2.3. Account Verification. Whether or not a Default or Event of Default exists,
Agent shall have the right at any time, in the name of Agent, any designee of Agent or any Borrower, to verify the validity, amount or any other matter relating to any Accounts of Borrowers by mail, telephone or otherwise. Borrowers shall cooperate
fully with Agent in an effort to facilitate and promptly conclude any such verification process. Agent shall give Borrower Agent notice after any such verification; provided, however, that the failure by Agent to provide Borrower Agent
such notice shall not give rise to any liability on its part or adversely affect any of the relative rights or obligations of Agent or any Obligor as provided herein. 
 8.2.4. Maintenance of Dominion Account. Borrowers shall maintain Dominion Accounts with Bank of America pursuant to lockbox or other arrangements acceptable to Agent. Borrowers shall obtain an
agreement (in form and substance satisfactory to Agent) from each lockbox servicer and Dominion Account bank, establishing Agent’s control over and Lien in the lockbox or Dominion Account, which may be exercised by Agent during any Trigger
Period, requiring immediate deposit of all remittances received in the lockbox to a Dominion Account, and waiving offset rights of such servicer or bank, except for customary administrative charges. Agent and Lenders assume no responsibility to
Borrowers for any lockbox arrangement or Dominion Account, including any claim of accord and satisfaction or release with respect to any Payment Items accepted by any bank. 
 8.2.5. Proceeds of Collateral. Borrowers shall request in writing and otherwise take all necessary steps to ensure that all payments on Accounts or otherwise relating to Collateral are made
directly to a Dominion Account (or a lockbox relating to a Dominion Account). If any Borrower or Subsidiary receives cash or Payment Items with respect to any Collateral, it shall hold same in trust for Agent and promptly (not later than the next
Business Day) deposit same into a Dominion Account. 
 8.3. Administration of Inventory. 

8.3.1. Records and Reports of Inventory. Each Borrower shall keep accurate and complete records of its Inventory, including costs
and daily withdrawals and additions, and shall submit to Agent inventory and reconciliation reports in form satisfactory to Agent, on such periodic basis as Agent may request. Each Borrower shall conduct a physical inventory at least once per
calendar year (and on a more frequent basis if requested by Agent when an Event of Default exists) and periodic cycle counts consistent with historical practices, and shall provide to Agent a report based on each such inventory and count promptly
upon completion thereof, together with such supporting information as Agent may request. Agent may participate in and observe each physical count. 
 8.3.2. Returns of Inventory. No Borrower shall return any Inventory to a supplier, vendor or other Person, whether for cash, credit or otherwise, unless (a) such return is in the Ordinary
Course of Business; (b) no Default, Event of Default or Overadvance exists or would result therefrom; (c) Agent is promptly notified if the aggregate Value of all Inventory returned in any month exceeds $3,000,000; and (d) any payment
received by a Borrower for a return during any Trigger Period is promptly remitted to Agent for application to the Obligations. 

8.3.3. Maintenance. Each Borrower shall take all steps to assure that all Inventory it produces is produced in accordance with
Applicable Law, including the FLSA. Borrowers shall use, store and maintain all Inventory with reasonable care and caution, in accordance with applicable standards of any insurance and in conformity with all Applicable Law, and shall make current
rent payments (within applicable grace periods provided for in leases) at all locations where any Collateral is located. 

8.4. Condition of Equipment. The Equipment necessary for the continued operation of Borrowers’ business
is in good operating condition and repair, and all necessary replacements and repairs have been made so that Borrowers can continue the operation of their business. 

 

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 8.5. Administration of Deposit Accounts. Schedule 8.5 sets forth all
Deposit Accounts maintained by Borrowers, including all Dominion Accounts. Each Borrower shall take all actions necessary to establish Agent’s control of each such Deposit Account (other than an account exclusively used for payroll, payroll
taxes or employee benefits). A Borrower shall be the sole account holder of each Deposit Account and shall not allow any other Person (other than Agent) to have control over a Deposit Account or any Property deposited therein. Each Borrower shall
promptly notify Agent of any opening or closing of a Deposit Account and, with the consent of Agent, will amend Schedule 8.5 to reflect same. 
 8.6. General Provisions. 
 8.6.1. Location of Collateral. All
tangible items of Collateral, other than Inventory in transit or located with customers, shall at all times be kept by Borrowers at the business locations set forth in Schedule 8.6.1, except that Borrowers may (a) make sales or other
dispositions of Collateral in accordance with Section 10.2.6; and (b) move Collateral to another location in the United States, upon 30 Business Days’ prior written notice to Agent. 

8.6.2. Insurance of Collateral; Condemnation Proceeds. 
 (a) Each Borrower shall maintain insurance with respect to the Collateral, covering casualty, hazard, theft, malicious mischief, flood and other risks, in amounts, with endorsements and with insurers
(with a Best Rating of at least A7, unless otherwise approved by Agent) satisfactory to Agent. All proceeds under each policy shall be payable to Agent with respect to the Collateral. From time to time upon request, Borrowers shall deliver to Agent
the originals or certified copies of its insurance policies and updated flood plain searches. Unless Agent shall agree otherwise, each policy shall include satisfactory endorsements (i) showing Agent as lender loss payee; (ii) requiring 30
days’ prior written notice to Agent in the event of cancellation of the policy for any reason whatsoever; and (iii) specifying that the interest of Agent shall not be impaired or invalidated by any act or neglect of any Borrower or the
owner of the Property, nor by the occupation of the premises for purposes more hazardous than are permitted by the policy. If any Borrower fails to provide and pay for any insurance, Agent may, at its option, but shall not be required to, procure
the insurance and charge Borrowers therefor. While no Event of Default exists, Borrowers may settle, adjust or compromise any insurance claim, as long as the proceeds are delivered to Agent in accordance with Section 8.6.2(b). If an
Event of Default exists, only Agent shall be authorized to settle, adjust and compromise any claims involving any Collateral. 

(b) Any proceeds of insurance relating to the Collateral and any awards arising from condemnation of any Collateral shall be paid to
Agent. Any such proceeds or awards that relate to Inventory shall be applied to payment of the Revolver Loans, and then to any other Obligations outstanding. 
 8.6.3. Protection of Collateral. All expenses of protecting, storing, warehousing, insuring, handling, maintaining and shipping any Collateral, all Taxes payable with respect to any Collateral
(including any sale thereof), and all other payments required to be made by Agent to any Person to realize upon any Collateral following the occurrence of an Event of Default or to prevent any Default or Event of Default, shall be borne and paid by
Borrowers. Agent shall not be liable or responsible in any way for the safekeeping of any Collateral, for any loss or damage thereto (except for reasonable care in its custody while Collateral is in Agent’s actual possession), for any
diminution in the value thereof, or for any act or default of any warehouseman, carrier, forwarding agency or other Person whatsoever, but the same shall be at Borrowers’ sole risk. 

8.6.4. Defense of Title to Collateral. Each Borrower shall at all times defend its title to Collateral and Agent’s Liens
therein against all Persons, claims and demands whatsoever, except Permitted Liens. 
  

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 8.7. Power of Attorney. Each Borrower hereby irrevocably constitutes and
appoints Agent (and all Persons designated by Agent) as such Borrower’s true and lawful attorney (and agent-in-fact) for the purposes provided in this Section. Agent, or Agent’s designee, may, without notice and in either its or a
Borrower’s name, but at the cost and expense of Borrowers: 
 (a) Endorse a Borrower’s name on any Payment Item or
other proceeds of Collateral (including proceeds of insurance) that come into Agent’s possession or control; and 
 (b)
During an Event of Default, (i) notify any Account Debtors of the assignment of their Accounts, demand and enforce payment of Accounts by legal proceedings or otherwise, and generally exercise any rights and remedies with respect to Accounts;
(ii) settle, adjust, modify, compromise, discharge or release any Accounts or other Collateral, or any legal proceedings brought to collect Accounts or Collateral; (iii) sell or assign any Accounts and other Collateral upon such terms, for
such amounts and at such times as Agent deems advisable; (iv) collect, liquidate and receive balances in Deposit Accounts or investment accounts, and take control, in any manner, of proceeds of Collateral; (v) prepare, file and sign a
Borrower’s name to a proof of claim or other document in a bankruptcy of an Account Debtor, or to any notice, assignment or satisfaction of Lien or similar document; (vi) receive, open and dispose of mail addressed to a Borrower, and
notify postal authorities to deliver any such mail to an address designated by Agent; (vii) endorse any Chattel Paper, Document, Instrument, bill of lading, or other document or agreement relating to any Accounts, Inventory or other Collateral;
(viii) use a Borrower’s stationery and sign its name to verifications of Accounts and notices to Account Debtors; (ix) use information contained in any data processing, electronic or information systems relating to Collateral;
(x) make and adjust claims under insurance policies; (xi) take any action as may be necessary or appropriate to obtain payment under any letter of credit, banker’s acceptance or other instrument for which a Borrower is a beneficiary;
and (xii) take all other actions as Agent deems appropriate to fulfill any Borrower’s obligations under the Loan Documents. 

SECTION 9. REPRESENTATIONS AND WARRANTIES 
 9.1. General Representations and Warranties. To induce Agent and Lenders to enter into this Agreement and to make available the Commitments, Loans and Letters of Credit, each Borrower
represents and warrants that: 
 9.1.1. Organization and Qualification. Each Borrower and Subsidiary is duly organized,
validly existing and in good standing under the laws of the jurisdiction of its organization. Each Borrower and Subsidiary is duly qualified, authorized to do business and in good standing as a foreign corporation in each jurisdiction where failure
to be so qualified could reasonably be expected to have a Material Adverse Effect. 
 9.1.2. Power and Authority. Each
Obligor is duly authorized to execute, deliver and perform its Loan Documents. The execution, delivery and performance of the Loan Documents have been duly authorized by all necessary action, and do not (a) require any consent or approval of
any holders of Equity Interests of any Obligor, other than those already obtained; (b) contravene the Organic Documents of any Obligor; (c) violate or cause a default under any Applicable Law or Material Contract; or (d) result in or
require the imposition of any Lien (other than Permitted Liens) on any Property of any Obligor. 
 9.1.3. Enforceability.
Each Loan Document is a legal, valid and binding obligation of each Obligor party thereto, enforceable in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency or similar laws affecting the enforcement of
creditors’ rights generally. 
  

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 9.1.4. Capital Structure. As of the Closing Date, Schedule 9.1.4 shows, for
each Borrower and Subsidiary, its name, its jurisdiction of organization, its authorized and issued Equity Interests and, for Borrowers and Subsidiaries other than Clearwater, the holders of its Equity Interests, and all agreements binding on such
holders with respect to their Equity Interests ); provided that upon request by Agent on dates after the Closing Date, Borrowers shall provide updated information with respect to the items required on Schedule 9.1.4. Except as
disclosed on Schedule 9.1.4, in the five years preceding the Closing Date, no Borrower or Subsidiary has acquired any substantial assets from any other Person nor been the surviving entity in a merger or combination. 

9.1.5. Title to Properties; Priority of Liens. Each Borrower and Subsidiary has good and marketable title to (or valid leasehold
interests in) all of its Real Estate, and good title to all of its personal Property, including all Property reflected in any financial statements delivered to Agent or Lenders, in each case free of Liens except Permitted Liens. Each Borrower and
Subsidiary has paid and discharged all lawful claims that, if unpaid, could become a Lien on its Properties, other than Permitted Liens. All Liens of Agent in the Collateral are duly perfected, first priority Liens, subject only to Permitted Liens
that are expressly allowed to have priority over Agent’s Liens. 
 9.1.6. Accounts. Agent may rely, in determining
which Accounts are Eligible Accounts, on all statements and representations made by Borrowers with respect thereto. Borrowers warrant, with respect to each Account at the time it is shown as an Eligible Account in a Borrowing Base Certificate, that:

 (a) it is genuine and in all respects what it purports to be, and is not evidenced by a judgment; 

(b) it arises out of a completed, bona fide sale and delivery of goods or rendition of services in the Ordinary Course of Business, and
substantially in accordance with any purchase order, contract or other document relating thereto; 
 (c) it is for a sum
certain, maturing as stated in the invoice covering such sale or rendition of services, a copy of which has been furnished or is available to Agent on request; 
 (d) it is not subject to any offset, Lien (other than Agent’s Lien), deduction, defense, dispute, counterclaim or other adverse condition except as arising in the Ordinary Course of Business and
disclosed to Agent; and it is absolutely owing by the Account Debtor, without contingency in any respect; 
 (e) no purchase
order, agreement, document or Applicable Law restricts assignment of the Account to Agent (regardless of whether, under the UCC, the restriction is ineffective), and the applicable Borrower is the sole payee or remittance party shown on the invoice;

 (f) no extension, compromise, settlement, modification, credit, deduction or return has been authorized with respect to the
Account, except discounts or allowances granted in the Ordinary Course of Business for prompt payment that are reflected on the face of the invoice related thereto and in the reports submitted to Agent hereunder; and 

(g) to the best of Borrowers’ knowledge, (i) there are no facts or circumstances that are reasonably likely to impair the
enforceability or collectibility of such Account; (ii) the Account Debtor had the capacity to contract when the Account arose, continues to meet the applicable Borrower’s customary credit standards, is Solvent, is not contemplating or
subject to an Insolvency Proceeding, and has not failed, or suspended or ceased doing business; and (iii) there are no proceedings or actions threatened or pending against any Account Debtor that could reasonably be expected to have a material
adverse effect on the Account Debtor’s financial condition. 
  

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 9.1.7. Financial Statements. The consolidated and consolidating balance sheets, and
related statements of income, cash flow and shareholder’s equity, of Borrowers and Subsidiaries that have been and are hereafter delivered to Agent and Lenders, are prepared in accordance with GAAP, and fairly present the financial positions
and results of operations of Borrowers and Subsidiaries at the dates and for the periods indicated, subject to, in the case of unaudited financial statements, changes resulting from audit, normal year end audit adjustments and the absence of
footnotes. All projections delivered from time to time to Agent and Lenders have been prepared in good faith, based on reasonable assumptions in light of the circumstances at such time, it being understood that forecasts and projections are subject
to uncertainties and contingencies and no assurance can be given that any forecast or projection will be realized. Since December 31, 2007, there has been no change in the condition, financial or otherwise, of any Borrower or Subsidiary that
could reasonably be expected to have a Material Adverse Effect. No financial statement delivered to Agent or Lenders at any time contains any untrue statement of a material fact, nor fails to disclose any material fact necessary to make such
statement not materially misleading. Each Borrower and Subsidiary is Solvent. 
 9.1.8. Surety Obligations. No Borrower
or Subsidiary is obligated as surety or indemnitor under any bond or other contract that assures payment or performance of any obligation of any Person, except as permitted hereunder. 

9.1.9. Taxes. Each Borrower and Subsidiary has filed all federal, state and local tax returns and other reports that it is
required by law to file, and has paid, or made provision for the payment of, all Taxes upon it, its income and its Properties that are due and payable, except to the extent being Properly Contested. The provision for Taxes on the books of each
Borrower and Subsidiary is adequate for all years not closed by applicable statutes, and for its current Fiscal Year. 
 9.1.10.
Brokers. There are no brokerage commissions, finder’s fees or investment banking fees payable in connection with any transactions contemplated by the Loan Documents. 

9.1.11. Intellectual Property. Each Borrower and Subsidiary owns or has the lawful right to use all Intellectual Property
necessary for the conduct of its business, without conflict with any rights of others. There is no pending or, to any Borrower’s knowledge, threatened Intellectual Property Claim with respect to any Borrower, any Subsidiary or any of their
Property (including any Intellectual Property). Except as disclosed on Schedule 9.1.11 (as the same may be updated in writing by Borrowers from time to time after the Closing Date), no Borrower or Subsidiary pays or owes any Royalty or other
compensation to any Person with respect to any Collateral Related Intellectual Property. All Collateral Related Intellectual Property and other Intellectual Property, the loss of which could reasonably be expected to have a Material Adverse Effect,
owned, used or licensed by, or otherwise subject to any interests of, any Borrower or Subsidiary is shown on Schedule 9.1.11 (as the same shall be updated in writing by Borrowers after the Closing Date once each 120 days). 

9.1.12. Governmental Approvals. Each Borrower and Subsidiary has, is in compliance with, and is in good standing with respect to,
all Governmental Approvals necessary to conduct its business and to own, lease and operate its Properties, except where noncompliance could not reasonably be expected to have a Material Adverse Effect. All necessary import, export or other licenses,
permits or certificates for the import or handling of any goods or other Collateral have been procured and are in effect, and Borrowers and Subsidiaries have complied with all foreign and domestic laws with respect to the shipment and importation of
any goods or Collateral, except where noncompliance could not reasonably be expected to have a Material Adverse Effect. 

9.1.13. Compliance with Laws. Each Borrower and Subsidiary has duly complied, and its Properties and business operations are in
compliance, in all material respects with all Applicable Law, except where noncompliance could not reasonably be expected to have a Material Adverse Effect. There have been no citations, notices or orders of material noncompliance issued to any
Borrower or Subsidiary under any Applicable Law which could reasonably be expected to have a Material Adverse Effect. No Inventory has been produced by any Borrower or Guarantor in violation of the FLSA. 

 

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 9.1.14. Compliance with Environmental Laws. Except as disclosed on Schedule
9.1.14, no Borrower’s or Subsidiary’s past or present operations, Real Estate or other Properties are subject to any federal, state or local investigation to determine whether any remedial action is needed to address any environmental
pollution, hazardous material or environmental clean-up and any such remedial action, if determined to be required, would have a Material Adverse Effect. No Borrower or Subsidiary has received any Environmental Notice which could reasonably be
expected to have a Material Adverse Effect. No Borrower or Subsidiary has any contingent liability with respect to any Environmental Release, environmental pollution or hazardous material on any Real Estate now or previously owned, leased or
operated by it which could reasonably be expected to have a Material Adverse Effect. 
 9.1.15. Burdensome Contracts. No
Borrower or Subsidiary is a party or subject to any contract, agreement or charter restriction that could reasonably be expected to have a Material Adverse Effect. No Borrower or Subsidiary is party or subject to any Restrictive Agreement, except as
shown on Schedule 9.1.15. No such Restrictive Agreement prohibits the execution, delivery or performance of any Loan Document by an Obligor. 
 9.1.16. Litigation. Except as shown on Schedule 9.1.16, there are no proceedings or investigations pending or, to any Borrower’s knowledge, threatened against any Borrower or
Subsidiary, or any of their businesses, operations, Properties, prospects or conditions, that (a) relate to any Loan Documents or transactions contemplated thereby; or (b) could reasonably be expected to have a Material Adverse Effect if
determined adversely to any Borrower or Subsidiary. No Borrower or Subsidiary is in default with respect to any order, injunction or judgment of any Governmental Authority. 
 9.1.17. No Defaults. No event or circumstance has occurred or exists that constitutes a Default or Event of Default. No Borrower or Subsidiary is in default, and no event or circumstance has
occurred or exists that with the passage of time or giving of notice would constitute a default, under any Material Contract or in the payment of any Borrowed Money. There is no basis upon which any party (other than a Borrower or Subsidiary) could
terminate a Material Contract prior to its scheduled termination date. 
 9.1.18. ERISA. Except as disclosed on
Schedule 9.1.18: 
 (a) Each Plan is in compliance in all material respects with the applicable provisions of ERISA, the
Code, and other federal and state laws. Each Plan that is intended to qualify under Section 401(a) of the Code has received a favorable determination letter from the IRS or an application for such a letter is currently being processed by the
IRS with respect thereto and, to the knowledge of Borrowers, nothing has occurred which would prevent, or cause the loss of, such qualification. Each Obligor and ERISA Affiliate has made all required contributions to each Plan subject to
Section 412 of the Code, and no application for a funding waiver or an extension of any amortization period pursuant to Section 412 of the Code has been made with respect to any Plan. 

(b) There are no pending or, to the knowledge of Borrowers, threatened claims, actions or lawsuits, or action by any Governmental
Authority, with respect to any Plan or Foreign Plan that could reasonably be expected to have a Material Adverse Effect. There has been no prohibited transaction or a breach of fiduciary duties under ERISA or applicable state or foreign law with
respect to any Plan or Foreign Plan that has resulted in or could reasonably be expected to have a Material Adverse Effect. 

(c) Except as could not reasonably be expected to result in a liability of the Obligors in excess of $1,000,000, (i) No ERISA Event
has occurred or is reasonably expected to occur; (ii) no 
  

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Pension Plan has any Unfunded Pension Liability; (iii) no Obligor or ERISA Affiliate has incurred, or reasonably expects to incur, any liability under Title IV of ERISA with respect to any
Pension Plan (other than premiums due and not delinquent under Section 4007 of ERISA); (iv) no Obligor or ERISA Affiliate has incurred, or reasonably expects to incur, any liability (and no event has occurred which, with the giving of
notice under Section 4219 of ERISA, would result in such liability) under Section 4201 or 4243 of ERISA with respect to a Multiemployer Plan; and (v) no Obligor or ERISA Affiliate has engaged in a transaction that could be subject to
Section 4069 or 4212(c) of ERISA. 
 (d) Except as could not reasonably be expected to result in a liability of the
Obligors in excess of $1,000,000, with respect to any Foreign Plan, (i) all employer and employee contributions required by law or by the terms of the Foreign Plan have been made, or, if applicable, accrued, in accordance with normal accounting
practices; (ii) the fair market value of the assets of each funded Foreign Plan sponsored or maintained by an Obligor or Subsidiary (a “Sponsored Foreign Plan”), the liability of each insurer for any Sponsored Foreign Plan funded
through insurance, or the book reserve established for any Sponsored Foreign Plan, together with any accrued contributions, is sufficient to procure or provide for the accrued benefit obligations with respect to all current and former participants
in such Sponsored Foreign Plan according to the actuarial assumptions and valuations most recently used to account for such obligations in accordance with applicable generally accepted accounting principles; and (iii) each Sponsored Foreign
Plan has been registered as required, has been maintained in good standing with applicable regulatory authorities, and satisfies all requirements of Applicable Law. 
 9.1.19. Trade Relations. There exists no actual or threatened termination, limitation or modification of any business relationship between any Borrower or Subsidiary and any customer or supplier,
or any group of customers or suppliers, who individually or in the aggregate are material to the business of such Borrower or Subsidiary. There exists no condition or circumstance that could reasonably be expected to impair the ability of any
Borrower or Subsidiary to conduct its business at any time hereafter in substantially the same manner as conducted on the Closing Date. 
 9.1.20. Labor Relations. Except as described on Schedule 9.1.20, no Borrower or Subsidiary is party to or bound by any collective bargaining agreement, management agreement or consulting
agreement. There are no material grievances, disputes or controversies with any union or other organization of any Borrower’s or Subsidiary’s employees. To any Borrower’s knowledge, there are no asserted or threatened strikes, work
stoppages or demands for collective bargaining which if occurred would have a Material Adverse Effect. 
 9.1.21. Payable
Practices. No Borrower or Subsidiary has made any material change in its historical accounts payable practices from those in effect on the Closing Date. 
 9.1.22. Not a Regulated Entity. No Obligor is (a) an “investment company” or a “person directly or indirectly controlled by or acting on behalf of an investment company”
within the meaning of the Investment Company Act of 1940; or (b) subject to regulation under the Federal Power Act, the Interstate Commerce Act, any public utilities code or any other Applicable Law regarding its authority to incur Debt.

 9.1.23. Margin Stock. No Borrower or Subsidiary is engaged, principally or as one of its important activities, in the
business of extending credit for the purpose of purchasing or carrying any Margin Stock. No Loan proceeds or Letters of Credit will be used by Borrowers to purchase or carry, or to reduce or refinance any Debt incurred to purchase or carry, any
Margin Stock or for any related purpose governed by Regulations T, U or X of the Board of Governors. 
 9.2. Complete
Disclosure. No Loan Document contains any untrue statement of a material fact, nor fails to disclose any material fact necessary to make the statements contained therein not materially misleading (it being understood that forecasts and
projections are subject to uncertainties and 
  

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contingencies and no assurance can be given that any forecast or projection will be realized). There is no fact or circumstance that any Obligor has failed to disclose to Agent in writing that
could reasonably be expected to have a Material Adverse Effect. 
 SECTION 10. COVENANTS AND CONTINUING AGREEMENTS 

10.1. Affirmative Covenants. As long as any Commitments or Obligations are outstanding, each Borrower shall, and
shall cause each Subsidiary to: 
 10.1.1. Inspections; Appraisals. 

(a) Permit Agent from time to time, subject (except when a Default or Event of Default exists) to reasonable notice and normal business
hours, to visit and inspect the Properties of any Borrower or Subsidiary, inspect, audit and make extracts from any Borrower’s or Subsidiary’s books and records, and discuss with its officers, employees, agents, advisors and independent
accountants such Borrower’s or Subsidiary’s business, financial condition, assets, prospects and results of operations. Lenders may participate in any such visit or inspection, at their own expense. Neither Agent nor any Lender shall have
any duty to any Borrower to make any inspection, nor to share any results of any inspection, appraisal or report with any Borrower. Borrowers acknowledge that all inspections, appraisals and reports are prepared by Agent and Lenders for their
purposes, and Borrowers shall not be entitled to rely upon them. 
 (b) Reimburse Agent for all charges, costs and expenses of
Agent in connection with (i) examinations of any Obligor’s books and records or any other financial or Collateral matters as Agent deems appropriate, up to four times per Loan Year; and (ii) appraisals of Inventory up to one time per
Loan Year; provided, however, that if an examination or appraisal is initiated during a Default or Event of Default or while Availability is less than an amount equal to twenty percent (20%) of the then aggregate Revolver
Commitments, all charges, costs and expenses therefor shall be reimbursed by Borrowers without regard to such limits. Subject to and without limiting the foregoing, Borrowers specifically agree to pay Agent’s then standard charges for each day
that an employee of Agent or its Affiliates is engaged in any examination activities, and shall pay the standard charges of Agent’s internal appraisal group. This Section shall not be construed to limit Agent’s right to conduct
examinations or to obtain appraisals at any time in its discretion, nor to use third parties for such purposes. 
 10.1.2.
Financial and Other Information. Keep adequate records and books of account with respect to its business activities, in which proper entries are made in accordance with GAAP reflecting all financial transactions; and furnish to Agent and
Lenders: 
 (a) as soon as available, and in any event within 90 days after the close of each Fiscal Year, balance sheets as of
the end of such Fiscal Year and the related statements of income, cash flow and shareholders’ equity for such Fiscal Year, on consolidated and consolidating bases for Borrowers and Subsidiaries, which consolidated statements shall be audited
and certified (without qualification) by a firm of independent certified public accountants of recognized standing selected by Borrowers and acceptable to Agent, and shall set forth in comparative form corresponding figures for the preceding Fiscal
Year and other information acceptable to Agent; 
 (b) as soon as available, and in any event within 30 days after the end of
each month, unaudited balance sheets as of the end of such month and the related statements of income and cash flow for such month and for the portion of the Fiscal Year then elapsed, on consolidated and consolidating bases for Borrowers and
Subsidiaries, setting forth in comparative form corresponding figures for the preceding Fiscal Year and certified by the chief financial officer of Borrower Agent as prepared in accordance with GAAP and fairly presenting the financial position and
results of operations for such month and period, subject to normal year-end adjustments and the absence of footnotes; 
  

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 (c) concurrently with delivery of financial statements under clauses (a) and
(b) above, or more frequently if requested by Agent while a Default or Event of Default exists, a Compliance Certificate executed by the chief financial officer of Borrower Agent; 

(d) concurrently with delivery of financial statements under clause (a) above, copies of all management letters and other material
reports submitted to Borrowers by their accountants in connection with such financial statements; 
 (e) not later than 30 days
prior to the end of each Fiscal Year, projections of Borrowers’ consolidated balance sheets, results of operations, cash flow and Availability for the next Fiscal Year, month by month; 

(f) at Agent’s request, a listing of each Borrower’s trade payables, specifying the trade creditor and balance due, and a
detailed trade payable aging, all in form satisfactory to Agent; 
 (g) promptly after the sending or filing thereof, copies of
any proxy statements, financial statements or reports that any Borrower has made generally available to its shareholders; copies of any regular, periodic and special reports or registration statements or prospectuses that any Borrower files with the
Securities and Exchange Commission or any other Governmental Authority, or any securities exchange; and copies of any press releases or other statements made available by a Borrower to the public concerning material changes to or developments in the
business of such Borrower; 
 (h) promptly after the sending or filing thereof, copies of any annual report to be filed in
connection with each Plan or Foreign Plan; 
 (i) such other reports and information (financial or otherwise) as Agent may
request from time to time in connection with any Collateral or any Borrower’s or Subsidiary’s financial condition or business; and 
 (j) as soon as available, and in any event within 120 days after the close of each Fiscal Year, financial statements for each Guarantor, in form and substance satisfactory to Agent. 

Documents required to be delivered pursuant to Sections 10.1.2(a) or (b) shall be deemed to have been delivered on the date on which
Borrower Agent provides Agent and each Lender with notice that such documents are posted on Clearwater’s behalf with the Securities Exchange Commission so long as: (i) Borrower Agent provides Agent and each Lender with a link to such
documents; and (ii) such documents are easily accessible and printable and in a format acceptable to Agent. 
 10.1.3.
Notices. Notify Agent and Lenders in writing, promptly after a Borrower’s obtaining knowledge thereof, of any of the following that affects an Obligor: (a) the threat or commencement of any proceeding or investigation, whether or
not covered by insurance, if an adverse determination is reasonably possible and could have a Material Adverse Effect; (b) any pending or threatened labor dispute, strike or walkout, or the expiration of any material labor contract;
(c) any default under or termination of a Material Contract; (d) the existence of any Default or Event of Default; (e) any judgment in an amount exceeding $1,000,000; (f) the assertion of any Intellectual Property Claim, if an
adverse resolution could have a Material Adverse Effect; (g) the institution of any proceeding against a Borrower or Guarantor with respect to, or the receipt of notice by a Borrower or Guarantor of potential liability or responsibility for,
any violation or asserted violation of any Applicable Law (including ERISA, OSHA, FLSA, or any Environmental Laws), if an adverse resolution could have a Material Adverse Effect; (h) any Environmental Release by a Borrower or Guarantor or on
any Property owned, leased or occupied by a Borrower or Guarantor if such Environmental Release could have a Material Adverse Effect; or receipt of any Environmental Notice if an adverse resolution could have a Material Adverse Effect; (i) the
occurrence of any ERISA Event; (j) the discharge of or any withdrawal or resignation by Borrowers’ independent accountants; or (k) any opening of a new office or place of business, at least 30 days prior to such opening. 

 

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 10.1.4. Landlord and Storage Agreements. Upon request, provide Agent with copies of
all existing agreements, and promptly after execution thereof provide Agent with copies of all future agreements, between an Obligor and any landlord, warehouseman, processor, shipper, bailee or other Person that owns any premises at which any
Collateral may be kept or that otherwise may possess or handle any Collateral. 
 10.1.5. Compliance with Laws. Comply
with all Applicable Laws, including ERISA, Environmental Laws, FLSA, OSHA, Anti-Terrorism Laws, and laws regarding collection and payment of Taxes, and maintain all Governmental Approvals necessary to the ownership of its Properties or conduct of
its business, unless failure to comply (other than failure to comply with Anti-Terrorism Laws) or maintain could not reasonably be expected to have a Material Adverse Effect. Without limiting the generality of the foregoing, if any Environmental
Release occurs which could have a Material Adverse Effect at or on any Properties of any Borrower or Subsidiary, it shall act promptly and diligently to investigate and report to Agent and, to the extent required by Applicable Law, all appropriate
Governmental Authorities the extent of, and to make appropriate remedial action to eliminate, such Environmental Release, whether or not directed to do so by any Governmental Authority. 

10.1.6. Taxes. Pay and discharge all Taxes prior to the date on which they become delinquent or penalties attach, unless such
Taxes are being Properly Contested. 
 10.1.7. Insurance. In addition to the insurance required hereunder with respect to
Collateral, maintain insurance with insurers (with a Best Rating of at least A7, unless otherwise approved by Agent) satisfactory to Agent, (a) with respect to the Properties and business of Borrowers and Subsidiaries of such type (including
product liability, workers’ compensation, larceny, embezzlement, or other criminal misappropriation insurance), in such amounts, and with such coverages and deductibles as are customary for companies similarly situated; and (b) business
interruption insurance in an amount not less than $20,000,000, with deductibles satisfactory to Agent. 
 10.1.8.
Licenses. Keep each License affecting any Inventory (including the manufacture, distribution or disposition of Inventory) or any other material Property of Borrowers and Subsidiaries in full force and effect; once every 120 days, notify Agent
of any modifications to any such Licenses, or entry into any new Licenses affecting any Inventory; pay all Royalties under such Licenses when due; and notify Agent of any default or breach asserted by any Person to have occurred under any such
License. 
 10.1.9. Future Subsidiaries. Promptly notify Agent upon any Person becoming a Subsidiary and, if such Person
is not a Foreign Subsidiary and Agent so requests, cause it to guaranty the Obligations in a manner satisfactory to Agent, and to execute and deliver such documents, instruments and agreements and to take such other actions as Agent shall require to
evidence and perfect a Lien in favor of Agent (for the benefit of Secured Parties) on all assets of such Person which are of the same type as the Collateral, including delivery of such legal opinions, in form and substance satisfactory to Agent, as
it shall deem appropriate. 
 10.1.10. Spin-Off. Within one (1) Business Day of the Closing Date, provide Agent with
evidence, in form and substance satisfactory to Agent, that the “Distribution” (as defined in the Separation Agreement) has occurred. 
 10.2. Negative Covenants. As long as any Commitments or Obligations are outstanding, each Borrower shall not, and shall cause each Subsidiary not to: 

 

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 10.2.1. Permitted Debt. Create, incur, guarantee or suffer to exist any Debt, except:

 (a) the Obligations; 
 (b) Subordinated Debt; 
 (c) Permitted Purchase Money Debt; 

(d) Borrowed Money (other than the Obligations, Subordinated Debt and Permitted Purchase Money Debt), but only to the extent outstanding
on the Closing Date and not satisfied with proceeds of the initial Loans; 
 (e) Bank Product Debt; 

(f) subject to the terms of the Intercreditor Agreement, the Potlatch Indebtedness; 

(g) Borrowed Money, the principal purpose of which is to satisfy and discharge Clearwater’s obligations under the Retained
Obligations Agreement; provided that: (i) it is in an aggregate principal amount that does not exceed $175,000,000, (ii) it has a final maturity date no sooner than ninety (90) days following the Revolver Termination Date,
(iii) if it is secured, it is subject to an intercreditor agreement in form and substance satisfactory to Required Lenders, (iv) no Liens are granted on any Collateral to secure it, (v) upon giving effect to it, no Default or Event of
Default exists, and (vi) the proceeds are first, used to satisfy the Potlatch Indebtedness in its entirety, and second, remitted to Agent for application to the Obligations; provided, however, that no more than $50,000,000 of
proceeds shall be required to be remitted to Agent under this clause (vi); 
 (h) Permitted Contingent Obligations; 

(i) So long as upon fair and reasonable terms and no less favorable than would be obtained in a comparable arm’s-length transaction
with a non-Affiliate: (i) Borrowed Money of any Borrower owing to another Borrower or Guarantor, and (ii) Borrowed Money of any Guarantor owing to another Guarantor; 
 (j) Debt and cash management obligations in respect of netting services, automatic clearinghouse arrangements, overdraft protectors, employee credit card programs and other cash management an similar
arrangements, in the Ordinary Course of Business; 
 (k) Debt arising from the honoring by a bank or other financial institution
of a check, draft or similar instrument drawn against insufficient funds in the Ordinary Course of Business or other cash management services in the Ordinary Course of Business; 

(l) Debt with respect to deferred compensation to employees of Borrowers and Subsidiaries in the Ordinary Course of Business; 

(m) subject to the aggregate cap on Permitted Acquisitions, as set forth in clause (g) of the definition thereof, earn-out
obligations, working capital adjustments, purchase price and similar adjustments and indemnification obligations under the agreements entered into in connection with any Permitted Acquisition; 

(n) Refinancing Debt as long as each Refinancing Condition is satisfied; and 

(o) Debt (other than Borrowed Money) consisting of retirement liabilities incurred in the Ordinary Course of Business; and 

 

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 (p) Debt that is not included in any of the preceding clauses of this Section, is not
secured by a Lien and does not exceed $10,000,000 in the aggregate at any time. 
 For purposes of determining compliance with this
Section 10.2.1, in the event that an item of Debt meets the criteria of more than one of the categories of Debt described in clause (a) through (o) above, Borrowers may, in their sole discretion, classify and reclassify or
later divide, classify or reclassify such item of Debt (or any portion thereof) and will only be required to include the amount and type of such Debt in one or more of the above clauses. 

10.2.2. Permitted Liens. Create or suffer to exist any Lien upon any of its Property, except the following (collectively,
“Permitted Liens”): 
 (a) Liens in favor of Agent; 

(b) Purchase Money Liens securing Permitted Purchase Money Debt; 

(c) Liens for Taxes not yet due or being Properly Contested; 
 (d) statutory Liens (including statutory Liens of landlords and Liens of carriers, warehousemen, mechanics and materialmen and other Liens imposed by law, but excluding Liens for Taxes or imposed under
ERISA) arising in the Ordinary Course of Business, but only if (i) payment of the obligations secured thereby is not yet due or is being Properly Contested, and (ii) such Liens do not materially impair the value or use of the Property or
materially impair operation of the business of any Borrower or Subsidiary; 
 (e) statutory Liens of suppliers imposed by law or
pursuant to customary reservations or retentions of title provided that: (i) such Liens do not attach to Collateral with a value of more than $250,000 at any time, (ii) such Liens arise in the Ordinary Course of Business, and
(iii) any such Liens are not perfected and are subordinated under law to the Liens in favor of Agent; 
 (f) Liens incurred
or deposits made in the Ordinary Course of Business to secure the performance of tenders, bids, leases, contracts (except those relating to Borrowed Money), statutory obligations and other similar obligations, or arising as a result of progress
payments under government contracts, as long as such Liens are at all times junior to Agent’s Liens; 
 (g) Liens arising
in the Ordinary Course of Business that are subject to Lien Waivers; 
 (h) Liens arising by virtue of a judgment or judicial
order against any Borrower or Subsidiary, or any Property of a Borrower or Subsidiary, as long as such Liens are (i) in existence for less than 20 consecutive days or being Properly Contested, and (ii) at all times junior to Agent’s
Liens; 
 (i) easements, rights-of-way, restrictions, covenants or other agreements of record, and other similar charges or
encumbrances on Real Estate, that do not secure any monetary obligation and do not interfere with the Ordinary Course of Business; 
 (j) normal and customary rights of setoff upon deposits in favor of depository institutions, and Liens of a collecting bank on Payment Items in the course of collection; 

(k) subject to the terms of the Intercreditor Agreement, Liens securing the Potlatch Indebtedness; 

(l) existing Liens shown on Schedule 10.2.2; 

 

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 (m) leases or subleases of Real Estate granted to others not interfering in any material
respect with the business of any Borrower or Subsidiary; 
 (n) any interest of title of a lessor under, and Liens arising from
UCC financing statements (or equivalent filings, registrations or agreements in foreign jurisdictions) relating to, leases permitted by this Agreement; 
 (o) Liens arising in the Ordinary Course of Business in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in connection with the importation of goods
(it being understood that any Inventory subject to such Liens shall not constitute Eligible Inventory); 
 (p) Liens of a
collection bank arising under Section 4208 of the UCC on items in the course of collection; 
 (q) Liens imposed on the
Potlatch Escrow Account to secure the obligations of Clearwater to Potlatch under the Retained Obligation Agreement and to the financial institution at which such account is established; and 

(r) any extension, renewal or replacement, in whole or in part, of any Lien described in the foregoing clauses (a) through (q);
provided that any such extension, renewal or replacement shall be no more restrictive in any material respect than the Lien extended, renewed or replaced and shall not extend to any other Property of Borrowers or Subsidiaries other than such item of
Property originally covered by such Lien or by improvement thereof or additions or accessions thereto. 
 10.2.3. Capital
Expenditures. Make Capital Expenditures in excess of the greater of, for a Fiscal Year: (a) (i) $25,000,000 in the aggregate during the 2008 Fiscal Year, (ii) $35,000,000 in the aggregate during the 2009 Fiscal Year,
(iii) $35,000,000 in the aggregate during the 2010 Fiscal Year, (iv) $40,000,000 in the aggregate during the 2011 Fiscal Year or (v) $40,000,000 in the aggregate during the 2012 Fiscal Year, or (b) the depreciation Borrowers
record on their books and records for such Fiscal Year; provided, however, that if the amount of Capital Expenditures permitted to be made in any Fiscal Year exceeds the amount actually made, up to $5,000,000 of such excess may be
carried forward to the next Fiscal Year. 
 10.2.4. Distributions; Upstream Payments. (a) Declare or make any
Distributions, except: (i) the distribution by Clearwater of Retainco to Potlatch in accordance with the terms of the Separation Agreement; (ii) Upstream Payments; (iii) repurchases of Equity Interests of Borrowers owned by former,
present of future employees, officers and directors of Borrowers or Subsidiaries or their assigns, estates and heirs, so long as: (A) the agreements setting forth such repurchase obligations were entered into by the applicable Borrower prior to
the Spin-Off; (B) the Revolver Commitments have not been terminated; (C) to the extent a Default or Event of Default exists before or after giving effect to any such repurchase, the amount of such repurchase does not exceed the amount of
the Repurchase Reserve then in effect; and (D) the aggregate amount of all such repurchases does not exceed $1,000,000; and (iv) Clearwater may pay dividends to its shareholders or repurchase Equity Interests from its shareholders, in each
case if (A) no Default or Event of Default has occurred and is continuing or would result therefrom, and (B) Modified Availability after giving effect to any such dividend or repurchase is not less than $45,000,000; or (b) create or
suffer to exist any encumbrance or restriction on the ability of a Subsidiary to make any Upstream Payment, except for restrictions under the Loan Documents, under Applicable Law or in effect on the Closing Date as shown on Schedule 9.1.15.

 10.2.5. Restricted Investments. Make any Restricted Investment. 

10.2.6. Disposition of Assets. Make any Asset Disposition, except a Permitted Asset Disposition. 

 

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 10.2.7. Loans. Make any loans or other advances of money to any Person, except
(a) advances to an officer or employee for salary, travel, relocation and other expenses, commissions and similar items in the Ordinary Course of Business; (b) prepaid expenses and extensions of trade credit made in the Ordinary Course of
Business; (c) deposits with financial institutions permitted hereunder; and (d) as long as no Default or Event of Default exists, intercompany loans by a Borrower to another Borrower. 

10.2.8. Restrictions on Payment of Certain Debt. Make any payments (whether voluntary or mandatory, or a prepayment, redemption,
retirement, defeasance or acquisition) with respect to (a) any Subordinated Debt, except regularly scheduled payments of principal, interest and fees, but only to the extent permitted under any subordination agreement relating to such Debt (and
a Senior Officer of Borrower Agent shall certify to Agent, not less than five Business Days prior to the date of payment, that all conditions under such agreement have been satisfied); (b) any Borrowed Money (other than the Obligations and the
Potlatch Indebtedness) prior to its due date under the agreements evidencing such Debt as in effect on the Closing Date (or as amended thereafter with the consent of Agent) unless permitted under Section 10.2.1(n); or (c) the
Potlatch Indebtedness unless such repayment is made with the proceeds of (i) Debt permitted under Section 10.2.1(g); (ii) an Asset Disposition permitted under clause (g) of the definition of Permitted Asset Disposition; or
(iii) an issuance of Equity Interests by Clearwater not otherwise prohibited under the terms of this Agreement. 
 10.2.9.
Fundamental Changes. (a) Merge, combine or consolidate with any Person, or liquidate, wind up its affairs or dissolve itself, in each case whether in a single transaction or in a series of related transactions, except for:
(i) mergers or consolidations of a wholly-owned Subsidiary with another wholly-owned Subsidiary or into a Borrower; (ii) transactions otherwise permitted pursuant to Section 10.2.5; (iii) liquidation or dissolution of any
Borrower (other than Clearwater) and any Subsidiary that Clearwater thereof determines in good faith that such action is in the best interest of it, the Borrowers and the Subsidiaries and is not materially disadvantageous to Agent or the Lenders so
long as (A) the assets (other than any Collateral) of such Borrower or Subsidiary that are distributed as part of such liquidation or dissolution are distributed to the direct holders of the Equity Interests of such Borrower or Subsidiary on a
pro rata basis; (B) any assets consisting of Collateral of such Borrower or Subsidiary are distributed to a Borrower; (C) both before and after giving effect to any such liquidation or dissolution, no Default or Event of Default has
occurred and is continuing; and (D) Borrower Agent provides Agent with no less than thirty (30) days prior written notice of such liquidation or dissolution; and (iv) any Permitted Asset Disposition that is effected through the merger
of a Subsidiary or Borrower (other than Clearwater) with a third party; or (b) change its name or conduct business under any fictitious name; change its tax, charter or other organizational identification number; or change its form or state of
organization. 
 10.2.10. Subsidiaries. Form or acquire any Subsidiary after the Closing Date, except in accordance with
Sections 10.1.9 and 10.2.5; or permit any existing Subsidiary to issue any additional Equity Interests except director’s qualifying shares. 
 10.2.11. Organic Documents. Amend, modify or otherwise change any of its Organic Documents as in effect on the Closing Date where such amendment, modification or other change would
materially adversely affect the interests of Agent or the Lenders. 
 10.2.12. Tax Consolidation. File or consent to the
filing of any consolidated income tax return with any Person other than Borrowers and Subsidiaries. 
 10.2.13. Accounting
Changes. Make any material change in accounting treatment or reporting practices, except as required by GAAP and in accordance with Section 1.2; or change its Fiscal Year. 
  

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 10.2.14. Restrictive Agreements. Become a party to any Restrictive Agreement, except
a Restrictive Agreement (a) in effect on the Closing Date; (b) relating to secured Debt permitted hereunder, as long as the restrictions apply only to collateral for such Debt; (c) constituting customary restrictions on assignment in
leases and other contracts; or (d) any restrictions imposed on any Property pursuant to an agreement that has been entered into in connection with a Permitted Disposition of such Property. 

10.2.15. Hedging Agreements. Enter into any Hedging Agreement, except to hedge risks arising in the Ordinary Course of Business
and not for speculative purposes. 
 10.2.16. Conduct of Business. Engage in any business, other than its business as
conducted on the Closing Date and any activities incidental thereto. 
 10.2.17. Affiliate Transactions. Enter into or be
party to any transaction with an Affiliate, except (a) transactions contemplated by the Loan Documents; (b) payment of reasonable compensation and provisions of other reasonable benefits to officers and employees, and loans and advances
permitted by Section 10.2.7; (c) payment of customary directors’ fees and indemnities; (d) transactions: (i) solely among Borrowers; (ii) solely among Guarantors; and (iii) solely among Subsidiaries that are
not Borrowers or Guarantors; (e) transactions with Affiliates that were consummated prior to the Closing Date, as shown on Schedule 10.2.17; (f) transactions permitted under Section 10.2.7; (g) agreements and
arrangements entered into in the Ordinary Course of Business with officers and employees of Borrowers in connection with termination of their employment therewith; (h) transactions contemplated in the Spin-Off Documents, (i) indemnity and
reimbursement provided on behalf of directors, officers and employees of any Borrower or Subsidiary in the Ordinary Course of Business; and (j) transactions with Affiliates in the Ordinary Course of Business, upon fair and reasonable terms
fully disclosed to Agent and no less favorable than would be obtained in a comparable arm’s-length transaction with a non-Affiliate. 
 10.2.18. Plans. Become party to any Multiemployer Plan or Foreign Plan, other than any in existence on the Closing Date and other than as disclosed to Agent upon thirty (30) days’ prior
written notice. 
 10.2.19. Amendments to Subordinated Debt; Potlatch Indebtedness. (a) Amend, supplement or
otherwise modify any document, instrument or agreement relating to any Subordinated Debt, if such modification (i) increases the principal balance of such Debt, or increases any required payment of principal or interest; (ii) accelerates
the date on which any installment of principal or any interest is due, or adds any additional redemption, put or prepayment provisions; (iii) shortens the final maturity date or otherwise accelerates amortization; (iv) increases the
interest rate; (v) increases or adds any fees or charges; (vi) modifies any covenant in a manner or adds any representation, covenant or default that is more onerous or restrictive in any material respect for any Borrower or Subsidiary, or
that is otherwise materially adverse to any Borrower, any Subsidiary or Lenders; or (vii) results in the Obligations not being fully benefited by the subordination provisions thereof, except that any acceleration or prepayment that would be
prohibited under clause (ii) or (iii) and any fees or charges prohibited under clause (v) shall not be prohibited under this Section 10.2.18 where such acceleration or prepayment is made, or such fees or charges are
incurred, in connection with a refinancing of such Subordinated Debt permitted under Section 10.2.1(n); or (b) amend, supplement or otherwise modify any document, instrument or agreement relating to the Potlatch Indebtedness without
the consent of Agent. 
 10.3. Fixed Charge Coverage Ratio. As long as any Commitments or Obligations are
outstanding, for each month ending during or immediately before any Trigger Period (each such month, a “Subject Month”), Borrowers shall maintain a Fixed Charge Coverage Ratio, when measured on a trailing twelve (12) month
basis (or, in the case of any Subject Month ending prior to the first anniversary of the Closing Date, when measured for the period from the Closing Date through the end of such Subject Month), of at least 1.0 to 1.0. 

 

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 SECTION 11. EVENTS OF DEFAULT; REMEDIES ON DEFAULT 

11.1. Events of Default. Each of the following shall be an “Event of Default” hereunder, if the same shall
occur for any reason whatsoever, whether voluntary or involuntary, by operation of law or otherwise: 
 (a) A Borrower fails to
pay any Obligations when due (whether at stated maturity, on demand, upon acceleration or otherwise); 
 (b) Any representation,
warranty or other written statement of a Borrower or Guarantor made in connection with any Loan Documents or transactions contemplated thereby is incorrect or misleading in any material respect when given; 

(c) A Borrower breaches or fail to perform any covenant contained in Section 7.2, 8.1, 8.2.4, 8.2.5, 8.6.2 (to the extent
insurance has not been maintained as required), 10.1.1, 10.1.2, 10.2 or 10.3; 
 (d) A Borrower or Guarantor
breaches or fails to perform any other covenant contained in any Loan Documents, and such breach or failure is not cured within 15 Business Days after a Senior Officer of such Borrower or Guarantor has knowledge thereof or receives notice thereof
from Agent, whichever is sooner; provided, however, that such notice and opportunity to cure shall not apply if the breach or failure to perform is not capable of being cured within such period or is a willful breach by a Borrower or
Guarantor; 
 (e) A Guarantor repudiates, revokes or attempts to revoke its Guaranty; an Obligor denies or contests the validity
or enforceability of any Loan Documents or Obligations, or the perfection or priority of any Lien granted to Agent; or any Loan Document ceases to be in full force or effect for any reason (other than a waiver or release by Agent and Lenders);

 (f) Any breach or default of a Borrower or Guarantor occurs under any document, instrument or agreement to which it is a
party or by which it or any of its Properties is bound, relating to any Debt (other than the Obligations) in excess of $15,000,000 (including, without limitation, the Potlatch Indebtedness), if the maturity of or any payment with respect to such
Debt may be accelerated or demanded due to such breach; 
 (g) Any judgment or order for the payment of money is entered against
a Borrower or Guarantor in an amount that exceeds, individually or cumulatively with all unsatisfied judgments or orders against all Borrowers and Guarantors, $5,000,000 (net of any insurance coverage therefor acknowledged in writing by the
insurer), unless: (i) a stay of enforcement of such judgment or order is in effect, by reason of a pending appeal or otherwise, or (ii) such judgment or order is satisfied within two (2) Business Days of it being entered; 

(h) A loss, theft, damage or destruction occurs with respect to any Collateral if the amount not covered by insurance exceeds $5,000,000;

 (i) A Borrower or Guarantor is enjoined, restrained or in any way prevented by any Governmental Authority from conducting any
material part of its business; a Borrower or Guarantor suffers the loss, revocation or termination of any material license, permit, lease or agreement necessary to its business; there is a cessation of any material part of a Borrower or
Guarantor’s business for a material period of time; any material Collateral or Property of a Borrower or Guarantor is taken or impaired through condemnation; a Borrower or Guarantor agrees to or commences any liquidation, dissolution or winding
up of its affairs except as permitted in Section 10.2.9; or a Borrower or Guarantor is not Solvent; 
  

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 (j) An Insolvency Proceeding is commenced by a Borrower or Guarantor; a Borrower or
Guarantor makes an offer of settlement, extension or composition to its unsecured creditors generally; a trustee is appointed to take possession of any substantial Property of or to operate any of the business of a Borrower or Guarantor; or an
Insolvency Proceeding is commenced against a Borrower or Guarantor and such Borrower or Guarantor consents to institution of the proceeding, the petition commencing the proceeding is not timely contested by such Borrower or Guarantor, the petition
is not dismissed within 30 days after filing, or an order for relief is entered in the proceeding; 
 (k) An ERISA Event occurs
with respect to a Pension Plan or Multiemployer Plan that has resulted or could reasonably be expected to result in liability of a Borrower or Guarantor to a Pension Plan, Multiemployer Plan or PBGC, or that constitutes grounds for appointment of a
trustee for or termination by the PBGC of any Pension Plan or Multiemployer Plan; a Borrower, Guarantor or ERISA Affiliate fails to pay when due any installment payment with respect to its withdrawal liability under Section 4201 of ERISA under
a Multiemployer Plan; or any event similar to the foregoing occurs or exists with respect to a Foreign Plan; except that no event or condition described in this Section 11.1(k) shall constitute an Event of Default if it, together with
all other such events or conditions at the time existing, has not resulted in, and could not reasonably be expected to result in, liability to Borrowers and Guarantors in excess of $1,000,000; 

(l) A Borrower or Guarantor or any of its Senior Officers is criminally indicted or convicted for (i) a felony committed in the
conduct of such Borrower’s or Guarantor’s business, or (ii) violating any state or federal law (including the Controlled Substances Act, Money Laundering Control Act of 1986 and Illegal Exportation of War Materials Act) that could
lead to forfeiture of any material Property or any Collateral; or 
 (m) A Change of Control occurs; or any event occurs or
condition exists that has a Material Adverse Effect. 
 11.2. Remedies upon Default. If an Event of Default
described in Section 11.1(j) occurs with respect to any Borrower, then to the extent permitted by Applicable Law, all Obligations shall become automatically due and payable and all Commitments shall terminate, without any action by Agent
or notice of any kind. In addition, or if any other Event of Default exists, Agent may in its discretion (and shall upon written direction of Required Lenders) do any one or more of the following from time to time: 

(a) declare any Obligations immediately due and payable, whereupon they shall be due and payable without diligence, presentment, demand,
protest or notice of any kind, all of which are hereby waived by Borrowers to the fullest extent permitted by law; 
 (b)
terminate, reduce or condition any Commitment, or make any adjustment to the Borrowing Base; 
 (c) require Obligors to Cash
Collateralize LC Obligations, Bank Product Debt and other Obligations that are contingent or not yet due and payable, and, if Obligors fail promptly to deposit such Cash Collateral, Agent may (and shall upon the direction of Required Lenders)
advance the required Cash Collateral as Revolver Loans (whether or not an Overadvance exists or is created thereby, or the conditions in Section 6 are satisfied); and 

(d) exercise any other rights or remedies afforded under any agreement, by law, at equity or otherwise, including the rights and remedies
of a secured party under the UCC. Such rights and remedies include the rights to (i) take possession of any Collateral; (ii) require Borrowers to assemble Collateral, at Borrowers’ expense, and make it available to Agent at a place
designated by Agent; (iii) enter any premises where Collateral is located and store Collateral on such premises until sold (and if the premises are owned or leased by a Borrower, Borrowers agree not to charge for such storage); and
(iv)
  

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sell or otherwise dispose of any Collateral in its then condition, or after any further manufacturing or processing thereof, at public or private sale, with such notice as may be required by
Applicable Law, in lots or in bulk, at such locations, all as Agent, in its discretion, deems advisable. Each Borrower agrees that 10 days’ notice of any proposed sale or other disposition of Collateral by Agent shall be reasonable. Agent shall
have the right to conduct such sales on any Obligor’s premises, without charge, and such sales may be adjourned from time to time in accordance with Applicable Law. Agent shall have the right to sell, lease or otherwise dispose of any
Collateral for cash, credit or any combination thereof, and Agent may purchase any Collateral at public or, if permitted by law, private sale and, in lieu of actual payment of the purchase price, may set off the amount of such price against the
Obligations. 
 11.3. License. Agent is hereby granted an irrevocable, non-exclusive and royalty-free license or
other right to use, license or sub-license (without payment of royalty or other compensation to any Person) (collectively, the “IP License”) any or all Intellectual Property of Borrowers, computer hardware and software, trade
secrets, brochures, customer lists, promotional and advertising materials, labels, packaging materials and other Property, in advertising for sale, marketing, selling, collecting, completing manufacture of, or otherwise exercising any rights or
remedies with respect to, any Collateral. Each Borrower’s rights and interests under Intellectual Property shall inure to Agent’s benefit. 
 11.4. Setoff. At any time during an Event of Default, Agent, Issuing Bank, Lenders, and any of their Affiliates are authorized, to the fullest extent permitted by Applicable Law, to set off
and apply any and all deposits (general or special, time or demand, provisional or final, in whatever currency) at any time held and other obligations (in whatever currency) at any time owing by Agent, Issuing Bank, such Lender or such Affiliate to
or for the credit or the account of a Borrower or Guarantor against any Obligations, irrespective of whether or not Agent, Issuing Bank, such Lender or such Affiliate shall have made any demand under this Agreement or any other Loan Document and
although such Obligations may be contingent or unmatured or are owed to a branch or office of Agent, Issuing Bank, such Lender or such Affiliate different from the branch or office holding such deposit or obligated on such indebtedness. The rights
of Agent, Issuing Bank, each Lender and each such Affiliate under this Section are in addition to other rights and remedies (including other rights of setoff) that such Person may have. 

11.5. Remedies Cumulative; No Waiver. 
 11.5.1. Cumulative Rights. All agreements, warranties, guaranties, indemnities and other undertakings of Borrowers under the Loan Documents are cumulative and not in derogation of each other. The
rights and remedies of Agent and Lenders are cumulative, may be exercised at any time and from time to time, concurrently or in any order, and are not exclusive of any other rights or remedies available by agreement, by law, at equity or otherwise.
All such rights and remedies shall continue in full force and effect until Full Payment of all Obligations. 
 11.5.2.
Waivers. No waiver or course of dealing shall be established by (a) the failure or delay of Agent or any Lender to require strict performance by Borrowers with any terms of the Loan Documents, or to exercise any rights or remedies with
respect to Collateral or otherwise; (b) the making of any Loan or issuance of any Letter of Credit during a Default, Event of Default or other failure to satisfy any conditions precedent; or (c) acceptance by Agent or any Lender of any
payment or performance by an Obligor under any Loan Documents in a manner other than that specified therein. It is expressly acknowledged by Borrowers that any failure to satisfy a financial covenant on a measurement date shall not be cured or
remedied by satisfaction of such covenant on a subsequent date. 
  

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 SECTION 12. AGENT 
 12.1. Appointment, Authority and Duties of Agent. 
 12.1.1.
Appointment and Authority. Each Lender appoints and designates Bank of America as Agent hereunder. Agent may, and each Lender authorizes Agent to, enter into all Loan Documents to which Agent is intended to be a party and accept all Security
Documents, for Agent’s benefit and the Pro Rata benefit of Lenders. Each Lender agrees that any action taken by Agent or Required Lenders in accordance with the provisions of the Loan Documents, and the exercise by Agent or Required Lenders of
any rights or remedies set forth therein, together with all other powers reasonably incidental thereto, shall be authorized by and binding upon all Lenders. Without limiting the generality of the foregoing, Agent shall have the sole and exclusive
authority to (a) act as the disbursing and collecting agent for Lenders with respect to all payments and collections arising in connection with the Loan Documents; (b) execute and deliver as Agent each Loan Document, including any
intercreditor or subordination agreement, and accept delivery of each Loan Document from any Obligor or other Person; (c) act as collateral agent for Secured Parties for purposes of perfecting and administering Liens under the Loan Documents,
and for all other purposes stated therein; (d) manage, supervise or otherwise deal with Collateral; and (e) take any Enforcement Action or otherwise exercise any rights or remedies with respect to any Collateral under the Loan Documents,
Applicable Law or otherwise. The duties of Agent shall be ministerial and administrative in nature, and Agent shall not have a fiduciary relationship with any Lender, Secured Party, Participant or other Person, by reason of any Loan Document or any
transaction relating thereto. Agent alone shall be authorized to determine whether any Accounts or Inventory constitute Eligible Accounts, Eligible Semi-Finished Inventory or Eligible Inventory, or whether to impose or release any reserve, and to
exercise its Credit Judgment in connection therewith, which determinations and judgments, if exercised in good faith, shall exonerate Agent from liability to any Lender or other Person for any error in judgment. 

12.1.2. Duties. Agent shall not have any duties except those expressly set forth in the Loan Documents. The conferral upon Agent
of any right shall not imply a duty on Agent’s part to exercise such right, unless instructed to do so by Required Lenders in accordance with this Agreement. 
 12.1.3. Agent Professionals. Agent may perform its duties through agents and employees. Agent may consult with and employ Agent Professionals, and shall be entitled to act upon, and shall be fully
protected in any action taken in good faith reliance upon, any advice given by an Agent Professional. Agent shall not be responsible for the negligence or misconduct of any agents, employees or Agent Professionals selected by it with reasonable
care. 
 12.1.4. Instructions of Required Lenders. The rights and remedies conferred upon Agent under the Loan Documents
may be exercised without the necessity of joinder of any other party, unless required by Applicable Law. Agent may request instructions from Required Lenders with respect to any act (including the failure to act) in connection with any Loan
Documents, and may seek assurances to its satisfaction from Lenders of their indemnification obligations under Section 12.6 against all Claims that could be incurred by Agent in connection with any act. Agent shall be entitled to refrain
from any act until it has received such instructions or assurances, and Agent shall not incur liability to any Person by reason of so refraining. Instructions of Required Lenders shall be binding upon all Lenders, and no Lender shall have any right
of action whatsoever against Agent as a result of Agent acting or refraining from acting in accordance with the instructions of Required Lenders. Notwithstanding the foregoing, instructions by and consent of all Lenders shall be required in the
circumstances described in Section 14.1.1, and in no event shall Required Lenders, without the prior written consent of each Lender, direct Agent to accelerate and demand payment of Loans held by one Lender without accelerating and
demanding payment of all other Loans, nor to terminate the Commitments of one Lender without terminating the Commitments of all Lenders. In no event shall Agent be required to take any action that, in its opinion, is contrary to Applicable Law or
any Loan Documents or could subject any Agent Indemnitee to personal liability. 
  

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 12.2. Agreements Regarding Collateral and Field Examination Reports.

 12.2.1. Lien Releases; Care of Collateral. Lenders authorize Agent to release any Lien with respect to any
Collateral (a) upon Full Payment of the Obligations; (b) that is the subject of an Asset Disposition which Borrowers certify in writing to Agent is a Permitted Asset Disposition or a Lien which Borrowers certify is a Permitted Lien
entitled to priority over Agent’s Liens (and Agent may rely conclusively on any such certificate without further inquiry); (c) that does not constitute a material part of the Collateral; or (d) with the written consent of all Lenders.
Agent shall have no obligation whatsoever to any Lenders to assure that any Collateral exists or is owned by a Borrower, or is cared for, protected, insured or encumbered, nor to assure that Agent’s Liens have been properly created, perfected
or enforced, or are entitled to any particular priority, nor to exercise any duty of care with respect to any Collateral. 

12.2.2. Possession of Collateral. Agent and Lenders appoint each Lender as agent (for the benefit of Secured Parties) for the
purpose of perfecting Liens in any Collateral held or controlled by such Lender, to the extent such Liens are perfected by possession or control. If any Lender obtains possession or control of any Collateral, it shall notify Agent thereof and,
promptly upon Agent’s request, deliver such Collateral to Agent or otherwise deal with it in accordance with Agent’s instructions. 
 12.2.3. Reports. Agent shall promptly forward to each Lender, when complete, copies of any field audit, examination or appraisal report prepared by or for Agent with respect to any Obligor or
Collateral (“Report”). Each Lender agrees (a) that neither Bank of America nor Agent makes any representation or warranty as to the accuracy or completeness of any Report, and shall not be liable for any information contained
in or omitted from any Report; (b) that the Reports are not intended to be comprehensive audits or examinations, and that Agent or any other Person performing any audit or examination will inspect only specific information regarding Obligations
or the Collateral and will rely significantly upon Borrowers’ books and records as well as upon representations of Borrowers’ officers and employees; and (c) to keep all Reports confidential and strictly for such Lender’s
internal use, and not to distribute any Report (or the contents thereof) to any Person (except to such Lender’s Participants, attorneys and accountants) or use any Report in any manner other than administration of the Loans and other
Obligations. Each Lender agrees to indemnify and hold harmless Agent and any other Person preparing a Report from any action such Lender may take as a result of or any conclusion it may draw from any Report, as well as from any Claims arising as a
direct or indirect result of Agent furnishing a Report to such Lender. 
 12.3. Reliance By Agent. Agent shall be
entitled to rely, and shall be fully protected in relying, upon any certification, notice or other communication (including those by telephone, telex, telegram, telecopy or e-mail) believed by it to be genuine and correct and to have been signed,
sent or made by the proper Person, and upon the advice and statements of Agent Professionals. 
 12.4. Action Upon
Default. Agent shall not be deemed to have knowledge of any Default or Event of Default unless it has received written notice from a Lender or Borrower specifying the occurrence and nature thereof. If any Lender acquires knowledge of a
Default or Event of Default, it shall promptly notify Agent and the other Lenders thereof in writing. Each Lender agrees that, except as otherwise provided in any Loan Documents or with the written consent of Agent and Required Lenders, it will not
take any Enforcement Action, accelerate Obligations under any Loan Documents, or exercise any right that it might otherwise have under Applicable Law to credit bid at foreclosure sales, UCC sales or other similar dispositions of Collateral.
Notwithstanding the foregoing, however, a Lender may take action to preserve or enforce its rights against an Obligor where a deadline or limitation period is applicable that would, absent such action, bar enforcement of Obligations held by such
Lender, including the filing of proofs of claim in an Insolvency Proceeding. 
 12.5. Ratable Sharing. If any
Lender shall obtain any payment or reduction of any Obligation, whether through set-off or otherwise, in excess of its share of such Obligation, determined on a Pro Rata basis or in accordance with Section 5.6.1, as applicable, such
Lender shall forthwith purchase from Agent, Issuing Bank and the other Lenders such participations in the affected Obligation as are necessary to cause the purchasing Lender to share the excess payment or reduction on a Pro Rata basis or

  

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in accordance with Section 5.6.1, as applicable. If any of such payment or reduction is thereafter recovered from the purchasing Lender, the purchase shall be rescinded and the
purchase price restored to the extent of such recovery, but without interest. No Lender shall set off against any Dominion Account without the prior consent of Agent. 
 12.6. Indemnification of Agent Indemnitees. EACH LENDER SHALL INDEMNIFY AND HOLD HARMLESS AGENT INDEMNITEES, TO THE EXTENT NOT REIMBURSED BY OBLIGORS (BUT WITHOUT LIMITING THE
INDEMNIFICATION OBLIGATIONS OF OBLIGORS UNDER ANY LOAN DOCUMENTS), ON A PRO RATA BASIS, AGAINST ALL CLAIMS THAT MAY BE INCURRED BY OR ASSERTED AGAINST ANY AGENT INDEMNITEE, PROVIDED THE CLAIM RELATES TO OR ARISES FROM AN AGENT INDEMNITEE ACTING AS
OR FOR AGENT (IN ITS CAPACITY AS AGENT). In Agent’s discretion, it may reserve for any such Claims made against an Agent Indemnitee, and may satisfy any judgment, order or settlement relating thereto, from proceeds of Collateral prior to
making any distribution of Collateral proceeds to Lenders. If Agent is sued by any receiver, bankruptcy trustee, debtor-in-possession or other Person for any alleged preference or fraudulent transfer, then any monies paid by Agent in settlement or
satisfaction of such proceeding, together with all interest, costs and expenses (including attorneys’ fees) incurred in the defense of same, shall be promptly reimbursed to Agent by each Lender to the extent of its Pro Rata share. 

12.7. Limitation on Responsibilities of Agent. Agent shall not be liable to Lenders for any action taken or omitted
to be taken under the Loan Documents, except for losses directly and solely caused by Agent’s gross negligence or willful misconduct. Agent does not assume any responsibility for any failure or delay in performance or any breach by any Obligor
or Lender of any obligations under the Loan Documents. Agent does not make to Lenders any express or implied warranty, representation or guarantee with respect to any Obligations, Collateral, Loan Documents or Obligor. No Agent Indemnitee shall be
responsible to Lenders for any recitals, statements, information, representations or warranties contained in any Loan Documents; the execution, validity, genuineness, effectiveness or enforceability of any Loan Documents; the genuineness,
enforceability, collectibility, value, sufficiency, location or existence of any Collateral, or the validity, extent, perfection or priority of any Lien therein; the validity, enforceability or collectibility of any Obligations; or the assets,
liabilities, financial condition, results of operations, business, creditworthiness or legal status of any Obligor or Account Debtor. No Agent Indemnitee shall have any obligation to any Lender to ascertain or inquire into the existence of any
Default or Event of Default, the observance or performance by any Obligor of any terms of the Loan Documents, or the satisfaction of any conditions precedent contained in any Loan Documents. 

12.8. Successor Agent and Co-Agents. 
 12.8.1. Resignation; Successor Agent. Subject to the appointment and acceptance of a successor Agent as provided below, Agent may resign at any time by giving at least 30 days’ written notice
thereof to Lenders and Borrowers. Upon receipt of such notice, Required Lenders shall have the right to appoint a successor Agent which shall be (a) a Lender or an Affiliate of a Lender; or (b) a commercial bank that is organized under the
laws of the United States or any state or district thereof, has a combined capital surplus of at least $200,000,000 and (provided no Default or Event of Default exists) is reasonably acceptable to Borrowers. If no successor agent is appointed prior
to the effective date of the resignation of Agent, then Agent may appoint a successor agent from among Lenders. Upon acceptance by a successor Agent of an appointment to serve as Agent hereunder, such successor Agent shall thereupon succeed to and
become vested with all the powers and duties of the retiring Agent without further act, and the retiring Agent shall be discharged from its duties and obligations hereunder but shall continue to have the benefits of the indemnification set forth in
Sections 12.6 and 14.2. Notwithstanding any Agent’s resignation, the provisions of this Section 12 shall continue in effect for its benefit with respect to any actions taken or omitted to be taken by it while Agent.
Any successor to Bank of America by merger or acquisition of stock or this loan shall continue to be Agent hereunder without further act on the part of the parties hereto, unless such successor resigns as provided above. 

 

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 12.8.2. Separate Collateral Agent. It is the intent of the parties that there shall
be no violation of any Applicable Law denying or restricting the right of financial institutions to transact business in any jurisdiction. If Agent believes that it may be limited in the exercise of any rights or remedies under the Loan Documents
due to any Applicable Law, Agent may appoint an additional Person who is not so limited, as a separate collateral agent or co-collateral agent. If Agent so appoints a collateral agent or co-collateral agent, each right and remedy intended to be
available to Agent under the Loan Documents shall also be vested in such separate agent. Every covenant and obligation necessary to the exercise thereof by such agent shall run to and be enforceable by it as well as Agent. Lenders shall execute and
deliver such documents as Agent deems appropriate to vest any rights or remedies in such agent. If any collateral agent or co-collateral agent shall die or dissolve, become incapable of acting, resign or be removed, then all the rights and remedies
of such agent, to the extent permitted by Applicable Law, shall vest in and be exercised by Agent until appointment of a new agent. 
 12.9. Due Diligence and Non-Reliance. Each Lender acknowledges and agrees that it has, independently and without reliance upon Agent or any other Lenders, and based upon such
documents, information and analyses as it has deemed appropriate, made its own credit analysis of each Obligor and its own decision to enter into this Agreement and to fund Loans and participate in LC Obligations hereunder. Each Lender has made such
inquiries concerning the Loan Documents, the Collateral and each Obligor as such Lender feels necessary. Each Lender further acknowledges and agrees that the other Lenders and Agent have made no representations or warranties concerning any Obligor,
any Collateral or the legality, validity, sufficiency or enforceability of any Loan Documents or Obligations. Each Lender will, independently and without reliance upon the other Lenders or Agent, and based upon such financial statements, documents
and information as it deems appropriate at the time, continue to make and rely upon its own credit decisions in making Loans and participating in LC Obligations, and in taking or refraining from any action under any Loan Documents. Except for
notices, reports and other information expressly requested by a Lender, Agent shall have no duty or responsibility to provide any Lender with any notices, reports or certificates furnished to Agent by any Obligor or any credit or other information
concerning the affairs, financial condition, business or Properties of any Obligor (or any of its Affiliates) which may come into possession of Agent or any of Agent’s Affiliates. 

12.10. Replacement of Certain Lenders. If a Lender (a) is a Defaulting Lender, or (b) fails to give its
consent to any amendment, waiver or action for which consent of all Lenders was required and Required Lenders consented, then, in addition to any other rights and remedies that any Person may have, Agent may, by notice to such Lender within 120 days
after such event, require such Lender to assign all of its rights and obligations under the Loan Documents to Eligible Assignee(s) specified by Agent, pursuant to appropriate Assignment and Acceptance(s) and within 20 days after Agent’s notice.
Agent is irrevocably appointed as attorney-in-fact to execute any such Assignment and Acceptance if the Lender fails to execute same. Such Lender shall be entitled to receive, in cash, concurrently with such assignment, all amounts owed to it under
the Loan Documents, including all principal, interest and fees through the date of assignment (but excluding any prepayment charge). 
 12.11. Remittance of Payments and Collections. 
 12.11.1.
Remittances Generally. All payments by any Lender to Agent shall be made by the time and on the day set forth in this Agreement, in immediately available funds. If no time for payment is specified or if payment is due on demand by Agent and
request for payment is made by Agent by 11:00 a.m. on a Business Day, payment shall be made by Lender not later than 2:00 p.m. on such day, and if request is made after 11:00 a.m., then payment shall be made by 11:00 a.m. on the next Business Day.
Payment by Agent to any Lender shall be made by wire transfer, in the type of funds received by Agent. Any such payment shall be subject to Agent’s right of offset for any amounts due from such Lender under the Loan Documents. 

 

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 12.11.2. Failure to Pay. If any Lender fails to pay any amount when due by it to
Agent pursuant to the terms hereof, such amount shall bear interest from the due date until paid at the rate determined by Agent as customary in the banking industry for interbank compensation. In no event shall Borrowers be entitled to receive
credit for any interest paid by a Lender to Agent, nor shall any Defaulting Lender be entitled to interest on any amounts held by Agent pursuant to Section 4.2. 
 12.11.3. Recovery of Payments. If Agent pays any amount to a Lender in the expectation that a related payment will be received by Agent from an Obligor and such related payment is not received,
then Agent may recover such amount from each Lender that received it. If Agent determines at any time that an amount received under any Loan Document must be returned to an Obligor or paid to any other Person pursuant to Applicable Law or otherwise,
then, notwithstanding any other term of any Loan Document, Agent shall not be required to distribute such amount to any Lender. If any amounts received and applied by Agent to any Obligations are later required to be returned by Agent pursuant to
Applicable Law, each Lender shall pay to Agent, on demand, such Lender’s Pro Rata share of the amounts required to be returned. 
 12.12. Agent in its Individual Capacity. As a Lender, Bank of America shall have the same rights and remedies under the other Loan Documents as any other Lender, and the terms
“Lenders,” “Required Lenders” or any similar term shall include Bank of America in its capacity as a Lender. Each of Bank of America and its Affiliates may accept deposits from, maintain deposits or credit balances for, invest
in, lend money to, provide Bank Products to, act as trustee under indentures of, serve as financial or other advisor to, and generally engage in any kind of business with, Obligors and their Affiliates, as if Bank of America were any other bank,
without any duty to account therefor (including any fees or other consideration received in connection therewith) to the other Lenders. In their individual capacity, Bank of America and its Affiliates may receive information regarding Obligors,
their Affiliates and their Account Debtors (including information subject to confidentiality obligations), and each Lender agrees that Bank of America and its Affiliates shall be under no obligation to provide such information to Lenders, if
acquired in such individual capacity and not as Agent hereunder. 
 12.13. Agent Titles. Each Lender, other than
Bank of America, that is designated (on the cover page of this Agreement or otherwise) by Bank of America as an “Agent” or “Arranger” of any type shall not have any right, power, responsibility or duty under any Loan Documents
other than those applicable to all Lenders, and shall in no event be deemed to have any fiduciary relationship with any other Lender. 
 12.14. No Third Party Beneficiaries. This Section 12 is an agreement solely among Lenders and Agent, and shall survive Full Payment of the Obligations. This
Section 12 does not confer any rights or benefits upon Borrowers or any other Person. As between Borrowers and Agent, any action that Agent may take under any Loan Documents or with respect to any Obligations shall be conclusively
presumed to have been authorized and directed by Lenders. 
 SECTION 13. BENEFIT OF AGREEMENT; ASSIGNMENTS AND PARTICIPATIONS

 13.1. Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of
Borrowers, Agent, Lenders, and their respective successors and assigns, except that (a) no Borrower shall have the right to assign its rights or delegate its obligations under any Loan Documents; and (b) any assignment by a Lender must be
made in compliance with Section 13.3. Agent may treat the Person which made any Loan as the owner thereof for all purposes until such Person makes an assignment in accordance with Section 13.3. Any authorization or consent of
a Lender shall be conclusive and binding on any subsequent transferee or assignee of such Lender. 
  

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 13.2. Participations. 

13.2.1. Permitted Participants; Effect. Any Lender may, in the ordinary course of its business and in accordance with Applicable
Law, at any time sell to a financial institution (“Participant”) a participating interest in the rights and obligations of such Lender under any Loan Documents. Despite any sale by a Lender of participating interests to a Participant, such
Lender’s obligations under the Loan Documents shall remain unchanged, such Lender shall remain solely responsible to the other parties hereto for performance of such obligations, such Lender shall remain the holder of its Loans and Commitments
for all purposes, all amounts payable by Borrowers shall be determined as if such Lender had not sold such participating interests, and Borrowers and Agent shall continue to deal solely and directly with such Lender in connection with the Loan
Documents. Each Lender shall be solely responsible for notifying its Participants of any matters under the Loan Documents, and Agent and the other Lenders shall not have any obligation or liability to any such Participant. A Participant that would
be a Foreign Lender if it were a Lender shall not be entitled to the benefits of Section 5.9 unless Borrowers agree otherwise in writing. 
 13.2.2. Voting Rights. Each Lender shall retain the sole right to approve, without the consent of any Participant, any amendment, waiver or other modification of any Loan Documents other than that
which forgives principal, interest or fees, reduces the stated interest rate or fees payable with respect to any Loan or Commitment in which such Participant has an interest, postpones the Commitment Termination Date or any date fixed for any
regularly scheduled payment of principal, interest or fees on such Loan or Commitment, or releases any Borrower, Guarantor or substantial portion of the Collateral. 
 13.2.3. Benefit of Set-Off. Borrowers agree that each Participant shall have a right of set-off in respect of its participating interest to the same extent as if such interest were owing directly
to a Lender, and each Lender shall also retain the right of set-off with respect to any participating interests sold by it. By exercising any right of set-off, a Participant agrees to share with Lenders all amounts received through its set-off, in
accordance with Section 12.5 as if such Participant were a Lender. 
 13.3. Assignments. 

13.3.1. Permitted Assignments. A Lender may assign to an Eligible Assignee any of its rights and obligations under the Loan
Documents, as long as (a) each assignment is of a constant, and not a varying, percentage of the transferor Lender’s rights and obligations under the Loan Documents and, in the case of a partial assignment, is in a minimum principal amount
of $12,500,000 (unless otherwise agreed by Agent in its discretion) and integral multiples of $2,500,000 in excess of that amount; (b) except in the case of an assignment in whole of a Lender’s rights and obligations, the aggregate amount
of the Commitments retained by the transferor Lender is at least $12,500,000 (unless otherwise agreed by Agent in its discretion); and (c) the parties to each such assignment shall execute and deliver to Agent, for its acceptance and recording,
an Assignment and Acceptance. Nothing herein shall limit the right of a Lender to pledge or assign any rights under the Loan Documents to (i) any Federal Reserve Bank or the United States Treasury as collateral security pursuant to Regulation A
of the Board of Governors and any Operating Circular issued by such Federal Reserve Bank, or (ii) counterparties to swap agreements relating to any Loans; provided, however, that any payment by Borrowers to the assigning Lender in
respect of any Obligations assigned as described in this sentence shall satisfy Borrowers’ obligations hereunder to the extent of such payment, and no such assignment shall release the assigning Lender from its obligations hereunder.

 13.3.2. Effect; Effective Date. Upon delivery to Agent of an assignment notice in the form of Exhibit C and a
processing fee of $3,500 (unless otherwise agreed by Agent in its discretion), the assignment shall become effective as specified in the notice, if it complies with this Section 13.3. From such effective date, the Eligible Assignee shall
for all purposes be a Lender under the Loan Documents, and shall have all rights and obligations of a Lender thereunder. Upon consummation of an assignment, the transferor Lender, Agent and Borrowers shall make appropriate arrangements for issuance
of replacement and/or new Notes, as applicable. The transferee Lender shall comply with Section 5.10 and deliver, upon request, an administrative questionnaire satisfactory to Agent. 

 

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 SECTION 14. MISCELLANEOUS 

14.1. Consents, Amendments and Waivers. 
 14.1.1. Amendment. No modification of any Loan Document, including any extension or amendment of a Loan Document or any waiver of a Default or Event of Default, shall be effective without the prior
written agreement of Agent (with the consent of Required Lenders) and each Obligor party to such Loan Document; provided, however, that 
 (a) without the prior written consent of Agent, no modification shall be effective with respect to any provision in a Loan Document that relates to any rights, duties or discretion of Agent; 

(b) without the prior written consent of Issuing Bank, no modification shall be effective with respect to any LC Obligations or
Section 2.3; 
 (c) without the prior written consent of each affected Lender, no modification shall be effective that
would (i) increase the Commitment of such Lender; or (ii) reduce the amount of, or waive or delay payment of, any principal, interest or fees payable to such Lender; and 

(d) without the prior written consent of all Lenders (except a Defaulting Lender as provided in Section 4.2), no modification
shall be effective that would (i) extend the Revolver Termination Date; (ii) alter Section 5.6, 7.1 (except to add Collateral) or 14.1.1; (iii) amend the definitions of Borrowing Base (and the defined terms used in
such definition), Pro Rata or Required Lenders; (iv) increase any advance rate, decrease the Availability Block or increase total Commitments (other than as otherwise provided herein); (vi) release Collateral with a book value greater than
$10,000,000 during any calendar year, except as currently contemplated by the Loan Documents; or (vii) release any Obligor from liability for any Obligations, if such Obligor is Solvent at the time of the release other than in connection with a
Permitted Disposition. 
 14.1.2. Limitations. The agreement of Borrowers shall not be necessary to the effectiveness of
any modification of a Loan Document that deals solely with the rights and duties of Lenders, Agent and/or Issuing Bank as among themselves and does not modify any right, obligation or liability of any Obligor. Only the consent of the parties to the
Fee Letters or any agreement relating to a Bank Product shall be required for any modification of such agreement, and any non-Lender that is party to a Bank Product agreement shall have no right to participate in any manner in modification of any
other Loan Document. Any waiver or consent granted by Agent or Lenders hereunder shall be effective only if in writing and only for the matter specified. 
 14.1.3. Payment for Consents. No Borrower will, directly or indirectly, pay any remuneration or other thing of value, whether by way of additional interest, fee or otherwise, to any Lender (in its
capacity as a Lender hereunder) as consideration for agreement by such Lender with any modification of any Loan Documents, unless such remuneration or value is concurrently paid, on the same terms, on a Pro Rata basis to all Lenders providing their
consent. 
 14.2. Indemnity. EACH BORROWER SHALL INDEMNIFY AND HOLD HARMLESS THE INDEMNITEES AGAINST ANY
CLAIMS THAT MAY BE INCURRED BY OR ASSERTED AGAINST ANY INDEMNITEE, INCLUDING CLAIMS ARISING FROM THE NEGLIGENCE OF AN INDEMNITEE. In no event shall any party to a Loan Document have any obligation thereunder to indemnify or hold harmless an
Indemnitee with respect to a Claim that is determined in a final, non-appealable judgment by a court of competent jurisdiction to result from the gross negligence or willful misconduct of such Indemnitee. 

 

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 14.3. Notices and Communications. 

14.3.1. Notice Address. Subject to Section 4.1.4, all notices and other communications by or to a party hereto shall be
in writing and shall be given to any Borrower, at Borrower Agent’s address shown on the signature pages hereof, and to any other Person at its address shown on the signature pages hereof (or, in the case of a Person who becomes a Lender after
the Closing Date, at the address shown on its Assignment and Acceptance), or at such other address as a party may hereafter specify by notice in accordance with this Section 14.3. Each such notice or other communication shall be
effective only (a) if given by facsimile transmission, when transmitted to the applicable facsimile number, if confirmation of receipt is received; (b) if given by mail, three Business Days after deposit in the U.S. mail, with first-class
postage pre-paid, addressed to the applicable address; or (c) if given by personal delivery, when duly delivered to the notice address with receipt acknowledged. Notwithstanding the foregoing, no notice to Agent pursuant to
Section 2.1.4, 2.3, 3.1.2, 4.1.1 or 5.3.3 shall be effective until actually received by the individual to whose attention at Agent such notice is required to be sent. Any written notice or other communication that is not sent in
conformity with the foregoing provisions shall nevertheless be effective on the date actually received by the noticed party. Any notice received by Borrower Agent shall be deemed received by all Borrowers. 

14.3.2. Electronic Communications; Voice Mail. Electronic mail and internet websites may be used only for routine communications,
such as financial statements, Borrowing Base Certificates and other information required by Section 10.1.2, administrative matters, distribution of Loan Documents for execution, and matters permitted under Section 4.1.4.
Agent and Lenders make no assurances as to the privacy and security of electronic communications. Electronic and voice mail may not be used as effective notice under the Loan Documents. 

14.3.3. Non-Conforming Communications. Agent and Lenders may rely upon any notices purportedly given by or on behalf of any
Borrower even if such notices were not made in a manner specified herein, were incomplete or were not confirmed, or if the terms thereof, as understood by the recipient, varied from a later confirmation. Each Borrower shall indemnify and hold
harmless each Indemnitee from any liabilities, losses, costs and expenses arising from any telephonic communication purportedly given by or on behalf of a Borrower. 
 14.4. Performance of Borrowers’ Obligations. Agent may, in its discretion at any time and from time to time, at Borrowers’ expense, pay any amount or do any act
required of a Borrower under any Loan Documents or otherwise lawfully requested by Agent to (a) enforce any Loan Documents or collect any Obligations; (b) protect, insure, maintain or realize upon any Collateral; or (c) defend or
maintain the validity or priority of Agent’s Liens in any Collateral, including any payment of a judgment, insurance premium, warehouse charge, finishing or processing charge, or landlord claim, or any discharge of a Lien. All payments, costs
and expenses (including Extraordinary Expenses) of Agent under this Section shall be reimbursed to Agent by Borrowers, on demand, with interest from the date incurred to the date of payment thereof at the Default Rate applicable to Base Rate
Revolver Loans. Any payment made or action taken by Agent under this Section shall be without prejudice to any right to assert an Event of Default or to exercise any other rights or remedies under the Loan Documents. 

14.5. Credit Inquiries. Each Borrower hereby authorizes Agent and Lenders (but they shall have no obligation) to respond to
usual and customary credit inquiries from third parties concerning any Borrower or Subsidiary. 
 14.6.
Severability. Wherever possible, each provision of the Loan Documents shall be interpreted in such manner as to be valid under Applicable Law. If any provision is found to be invalid under Applicable Law, it shall be ineffective
only to the extent of such invalidity and the remaining provisions of the Loan Documents shall remain in full force and effect. 

14.7. Cumulative Effect; Conflict of Terms. The provisions of the Loan Documents are cumulative. The parties
acknowledge that the Loan Documents may use several limitations, tests or 
  

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measurements to regulate similar matters, and they agree that these are cumulative and that each must be performed as provided. Except as otherwise provided in another Loan Document (by specific
reference to the applicable provision of this Agreement), if any provision contained herein is in direct conflict with any provision in another Loan Document, the provision herein shall govern and control. 

14.8. Counterparts. Any Loan Document may be executed in counterparts, each of which shall constitute an original,
but all of which when taken together shall constitute a single contract. This Agreement shall become effective when Agent has received counterparts bearing the signatures of all parties hereto. Delivery of a signature page of any Loan Document by
telecopy or other electronic means shall be effective as delivery of a manually executed counterpart of such agreement. 

14.9. Entire Agreement. Time is of the essence of the Loan Documents. The Loan Documents constitute the entire
contract among the parties relating to the subject matter hereof, and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof. 

14.10. Relationship with Lenders. The obligations of each Lender hereunder are several, and no Lender shall be
responsible for the obligations or Commitments of any other Lender. Amounts payable hereunder to each Lender shall be a separate and independent debt. It shall not be necessary for Agent or any other Lender to be joined as an additional party in any
proceeding for such purposes. Nothing in this Agreement and no action of Agent or Lenders pursuant to the Loan Documents shall be deemed to constitute Agent and Lenders to be a partnership, association, joint venture or any other kind of entity, nor
to constitute control of any Borrower. 
 14.11. No Advisory or Fiduciary Responsibility. In connection
with all aspects of each transaction contemplated by any Loan Document, Borrowers acknowledge and agree that (a)(i) this credit facility and any related arranging or other services by Agent, any Lender, any of their Affiliates or any arranger are
arm’s-length commercial transactions between Borrowers and such Person; (ii) Borrowers have consulted their own legal, accounting, regulatory and tax advisors to the extent they have deemed appropriate; and (iii) Borrowers are capable
of evaluating and understanding, and do understand and accept, the terms, risks and conditions of the transactions contemplated by the Loan Documents; (b) each of Agent, Lenders, their Affiliates and any arranger is and has been acting solely
as a principal in connection with this credit facility, is not the financial advisor, agent or fiduciary for Borrowers, any of their Affiliates or any other Person, and has no obligation with respect to the transactions contemplated by the Loan
Documents except as expressly set forth therein; and (c) Agent, Lenders, their Affiliates and any arranger may be engaged in a broad range of transactions that involve interests that differ from Borrowers and their Affiliates, and have no
obligation to disclose any of such interests to Borrowers or their Affiliates. To the fullest extent permitted by Applicable Law, each Borrower hereby waives and releases any claims that it may have against Agent, Lenders, their Affiliates and any
arranger with respect to any breach or alleged breach of agency or fiduciary duty in connection with any aspect of any transaction contemplated by a Loan Document. 
 14.12. Confidentiality. Each of Agent, Lenders and Issuing Bank agrees to maintain the confidentiality of all Information (as defined below), except that Information may be disclosed
(a) to its Affiliates and to its and its Affiliates’ respective partners, directors, officers, employees, agents, advisors and representatives (provided such Persons are informed of the confidential nature of the Information and instructed
to keep the Information confidential); (b) to the extent requested by any governmental, regulatory or self-regulatory authority purporting to have jurisdiction over it or its Affiliates; (c) to the extent required by Applicable Law or by
any subpoena or similar legal process; (d) to any other party hereto; (e) in connection with any action or proceeding, or other exercise of rights or remedies, relating to any Loan Documents or Obligations; (f) subject to an agreement
containing provisions substantially the same as this Section, to any Transferee or any actual or prospective party (or its advisors) to any Bank Product; (g) with the consent of Borrower Agent; or (h) to the extent such Information
(i) becomes 
  

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publicly available other than as a result of a breach of this Section or (ii) is available to Agent, any Lender, Issuing Bank or any of their Affiliates on a nonconfidential basis from a
source other than Borrowers. Notwithstanding the foregoing, Agent and Lenders may publish or disseminate general information describing this credit facility, including the names and addresses of Borrowers and a general description of Borrowers’
businesses, and may use Borrowers’ logos, trademarks or product photographs in advertising materials. As used herein, “Information” means all information received from an Obligor or Subsidiary relating to it or its business
that is identified as confidential when delivered. Any Person required to maintain the confidentiality of Information pursuant to this Section shall be deemed to have complied if it exercises the same degree of care that it accords its own
confidential information. Each of Agent, Lenders and Issuing Bank acknowledges that (i) Information may include material non-public information concerning an Obligor or Subsidiary; (ii) it has developed compliance procedures regarding the
use of material non-public information; and (iii) it will handle such material non-public information in accordance with Applicable Law, including federal and state securities laws. 

14.13. Intentionally Omitted. 
 14.14. GOVERNING LAW. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS, UNLESS OTHERWISE SPECIFIED, SHALL BE GOVERNED BY THE LAWS OF THE STATE OF CALIFORNIA, WITHOUT GIVING EFFECT TO ANY CONFLICT OF
LAW PRINCIPLES (BUT GIVING EFFECT TO FEDERAL LAWS RELATING TO NATIONAL BANKS). 
 14.15. Consent to Forum;
Arbitration. 
 14.15.1. Forum. EACH BORROWER HEREBY CONSENTS TO THE NON-EXCLUSIVE JURISDICTION OF ANY FEDERAL
OR STATE COURT SITTING IN OR WITH JURISDICTION OVER LOS ANGELES COUNTY, CALIFORNIA, IN ANY PROCEEDING OR DISPUTE RELATING IN ANY WAY TO ANY LOAN DOCUMENTS, AND AGREES THAT ANY SUCH PROCEEDING SHALL BE BROUGHT BY IT SOLELY IN ANY SUCH COURT. EACH
BORROWER IRREVOCABLY WAIVES ALL CLAIMS, OBJECTIONS AND DEFENSES THAT IT MAY HAVE REGARDING SUCH COURT’S PERSONAL OR SUBJECT MATTER JURISDICTION, VENUE OR INCONVENIENT FORUM. EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE
MANNER PROVIDED FOR NOTICES IN SECTION 14.3.1. Nothing herein shall limit the right of Agent or any Lender to bring proceedings against any Obligor in any other court, nor limit the right of any party to serve process in any other manner
permitted by Applicable Law. Nothing in this Agreement shall be deemed to preclude enforcement by Agent of any judgment or order obtained in any forum or jurisdiction. 
 14.15.2. Arbitration. Notwithstanding any other provision of this Agreement to the contrary, any controversy or claim among the parties relating in any way to any Obligations or Loan
Documents, including any alleged tort, shall at the request of any party hereto be determined by binding arbitration conducted in accordance with the United States Arbitration Act (Title 9 U.S. Code). Arbitration proceedings will be determined in
accordance with the Act, the then-current rules and procedures for the arbitration of financial services disputes of the American Arbitration Association (“AAA”), and the terms of this Section. In the event of any inconsistency, the
terms of this Section shall control. If AAA is unwilling or unable to serve as the provider of arbitration or to enforce any provision of this Section, Agent may designate another arbitration organization with similar procedures to serve as the
provider of arbitration. The arbitration proceedings shall be conducted in Los Angeles or Pasadena, California. The arbitration hearing shall commence within 90 days of the arbitration demand and close within 90 days thereafter. The arbitration
award must be issued within 30 days after close of the hearing (subject to extension by the arbitrator for up to 60 days upon a showing of good cause), and shall include a concise written statement of reasons for the award. The arbitrator shall give
effect to applicable statutes of limitation in determining any controversy or claim, and for these purposes, service on AAA under 

 

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applicable AAA rules of a notice of claim is the equivalent of the filing of a lawsuit. Any dispute concerning this Section or whether a controversy or claim is arbitrable shall be determined by
the arbitrator. The arbitrator shall have the power to award legal fees to the extent provided by this Agreement. Judgment upon an arbitration award may be entered in any court having jurisdiction. The arbitrator shall not have the power to commit
errors of law or legal reasoning, and any award may be reviewed and vacated or corrected on appeal to a court of competent jurisdiction for any such error. The institution and maintenance of an action for judicial relief or pursuant to a provisional
or ancillary remedy shall not constitute a waiver of the right of any party, including the plaintiff, to submit the controversy or claim to arbitration if any other party contests such action for judicial relief. No controversy or claim shall be
submitted to arbitration without the consent of all parties if, at the time of the proposed submission, such controversy or claim relates to an obligation secured by Real Estate, but if all parties do not consent to submission of such a controversy
or claim to arbitration, it shall be determined as provided in the next sentence. At the request of any party, a controversy or claim that is not submitted to arbitration as provided above shall be determined by judicial reference; and if such an
election is made, the parties shall designate to the court a referee or referees selected under the auspices of the AAA in the same manner as arbitrators are selected in AAA sponsored proceedings and the presiding referee of the panel (or the
referee if there is a single referee) shall be an active attorney or retired judge; and judgment upon the award rendered by such referee or referees shall be entered in the court in which proceeding was commenced. None of the foregoing provisions of
this Section shall limit the right of Agent or Lenders to exercise self-help remedies, such as setoff, foreclosure or sale of any Collateral or to obtain provisional or ancillary remedies from a court of competent jurisdiction before, after or
during any arbitration proceeding. The exercise of a remedy does not waive the right of any party to resort to arbitration or reference. At Agent’s option, foreclosure under a mortgage or deed of trust, if any, may be accomplished either by
exercise of power of sale thereunder or by judicial foreclosure. 
 14.16. Waivers by Borrowers. To the
fullest extent permitted by Applicable Law, each Borrower waives (a) the right to trial by jury (which Agent and each Lender hereby also waives) in any proceeding or dispute of any kind relating in any way to any Loan Documents, Obligations or
Collateral; (b) presentment, demand, protest, notice of presentment, default, non-payment, maturity, release, compromise, settlement, extension or renewal of any commercial paper, accounts, documents, instruments, chattel paper and guaranties
at any time held by Agent on which a Borrower may in any way be liable, and hereby ratifies anything Agent may do in this regard; (c) notice prior to taking possession or control of any Collateral; (d) any bond or security that might be
required by a court prior to allowing Agent to exercise any rights or remedies; (e) the benefit of all valuation, appraisement and exemption laws; (f) any claim against Agent or any Lender, on any theory of liability, for special,
indirect, consequential, exemplary or punitive damages (as opposed to direct or actual damages) in any way relating to any Enforcement Action, Obligations, Loan Documents or transactions relating thereto; and (g) notice of acceptance hereof.
Each Borrower acknowledges that the foregoing waivers are a material inducement to Agent and Lenders entering into this Agreement and that Agent and Lenders are relying upon the foregoing in their dealings with Borrowers. Each Borrower has reviewed
the foregoing waivers with its legal counsel and has knowingly and voluntarily waived its jury trial and other rights following consultation with legal counsel. In the event of litigation, this Agreement may be filed as a written consent to a trial
by the court. 
 14.17. Patriot Act Notice. Agent and Lenders hereby notify Borrowers that pursuant to the
requirements of the Patriot Act, Agent and Lenders are required to obtain, verify and record information that identifies each Borrower, including its legal name, address, tax ID number and other information that will allow Agent and Lenders to
identify it in accordance with the Patriot Act. Agent and Lenders will also require information regarding each personal guarantor, if any, and may require information regarding Borrowers’ management and owners, such as legal name, address,
social security number and date of birth. 
 [Remainder of page intentionally left blank; signatures begin on following page]

  

 -74- 

 IN WITNESS WHEREOF, this Agreement has been executed and delivered as of the date set
forth above. 
  

			
	BORROWERS:
	
	 POTLATCH FOREST PRODUCTS CORPORATION,
which will change its name prior to the Closing Date to
 CLEARWATER PAPER
CORPORATION,
 a Delaware corporation

		
	By:	 	 /s/ LINDA MASSMAN

	Name:	 	LINDA MASSMAN
	Title:	 	VICE-PRESIDENT
		
	Address:	 	
		 	 601 West First Ave., Suite 1600
 Spokane, WA 99201
 Attn: Michael S. Gadd
 Telecopy: (509) 835-1561

  

 -75- 

			
	 AGENT AND LENDERS:
  

BANK OF AMERICA, N.A.,
 as Agent and
Lender

		
	By:	 	 /s/ Ron Bornstein

	Name:	 	Ron Bornstein
	Title:	 	Vice President

  

			
	Address:	 	
		 	 55 S. Lake Avenue, Suite 900

Pasadena, CA 91101
 Attn: Ron Bornstein or
Account Executive
 Telecopy: (626) 584-4600

 

 -76- 

			
	 WELLS FARGO FOOTHILL, LLC,
 as Lender

		
	By:	 	 /s/ Santi Amladi

	Name:	 	Santi Amladi
	Title:	 	Vice President
		
	Address:	 	
		 	 Wells Fargo Foothill
 2450
Colorado Ave
 Suite 3000 West
 Santa
Monica, CA 90404

		 	Attn: Tim Guilanians
		 	Telecopy: 866-350-1924

  

 -77- 

 SCHEDULE P-1 
 to 
 Loan and Security Agreement 

INVESTMENTS 

None. 

 SCHEDULE 1.1 
 to 
 Loan and Security Agreement 

COMMITMENTS OF LENDERS 
  

							
	
Lender                
	  	 Revolver Commitment
	    	 Total Commitments

	 Bank of America, N.A.
	  	  $75,000,000	    	  $75,000,000
	 Wells Fargo Foothill, LLC
	  	  $50,000,000	    	  $50,000,000
	 All Lenders:
	  	$125,000,000	    	$125,000,000

 SCHEDULE 8.5 
 to 
 Loan and Security Agreement 

DEPOSIT ACCOUNTS 
  

					
	 Depository Bank
	  	 Type of Account
	    	 Account Number

	 Wells Fargo Bank
	  	Controlled Disbursement Funding	    	4132365610
	 Wells Fargo Bank
	  	Accounts Payable	    	9600014013
	 Wells Fargo Bank
	  	Payroll Account	    	9600028968
	 Wells Fargo Bank
	  	EFT Tax Payment	    	960006135
	 Wells Fargo Bank
	  	Workers Compensation	    	9600016842
	 Wells Fargo Bank
	  	Depository	    	4121290720
	 Wells Fargo Bank
	  	Investment	    	0000841096
	 Bank of America
	  	Concentration	    	1233811838
	 Bank of America
	  	Pulp & Paper Lockbox	    	1233811857
	 Bank of America
	  	Wood Products Lockbox	    	1233811833
	 Bank of America
	  	Consumer Products Division Lockbox	    	1233812828
	 Union Bank of California
	  	Foreign Sales	    	0012006706
	 Union Bank of California
	  	General	    	0012023230

 SCHEDULE 8.6.1 
 to 
 Loan and Security Agreement 

BUSINESS LOCATIONS 
  

	1.	Borrowers currently have the following business locations, and no others: 

 Executive Offices Prior to Spin-Off 
 601 West First Ave., Suite 1600

 Spokane, WA 99201 
 Executive Officer Upon Spin-Off 
 (although certain post-spin officers
are currently working at this address) 
 601 W. Riverside Avenue, Suite 1100 

Spokane, Washington 99201 
 Facilities 
 108 Highway 65 S 

MC Gehee, AR 71654 
 805 Mill Rd 
 Lewiston, ID 83501 

3901 North Donna Street 
 North Las Vegas, NV 89030 
 21561 W Mississippi St 

Elwood, IL 60421 

Sales Offices 
 3000 E. Birch St., Suite 101 
 Brea, CA 92821-6261 

200 TechneCenter Drive, Suite 201 
 Milford, OH 45150 
 DTC 30 Building 

8301 East Prentice Ave, Suite 311 
 Greenwood Village, CO 80111 
 2345 S Alma School RD, Suite 100 

Mesa, AZ 85210 

4255 Westbrook Dr., Suite 213 
 Aurora, IL 60504 
 805 Broadway, Suite 745 

 Vancouver, WA 98660 

8400 Six Forks Rd, Suite 201 
 Raleigh, NC 27615 
 1600 Riviera Ave 

Walnut Creek, CA 94596 
 1095 Pingree Rd, Suite 210 
 Crystal Lake, IL 60014 

65 Germantown Court, Suite 311 
 Cordova, TN 38018 
 922 E.11th St. 

Tacoma, WA 98421 

421 Railhead Road 
 Fort Worth, TX 76106 
 5000 Hwy 4 North 

Ark. City, AR 71630 
 Clarkia Log Landing 
 Coeur D Alene, ID 83814 

 

	2.	The following bailees, warehouseman, similar parties and consignees hold inventory of a 
Borrower or Subsidiary as of the spin-off: 

 

			
	 Name of Party
	  	 Address of Party

	 Airport Distribution & Warehousing
	  	 4208 Sarellen Road

Richmond, VA 23231

		
	 All South Warehouse
	  	 1645 Market Drive
 Atlanta,
GA 30316

		
	 Atlas Columbia Warehouse
	  	 922 East 11th Street

Tacoma, WA 98421

		
	 B&E Storage and Transfer, Inc.
	  	 7951 Oceano Drive,
 Jessup,
MD 21046

		
	 C & M Warehouse
	  	 95 Leggett Street
 East
Hartford, CT 06128

		
	 Carolina National Transportation
	  	 1450 Lower Road
 Linden,
NJ 07036

		
	 Carolina Public Warehouse Inc.
	  	 3609 Glenn Ave
 Winston
Salem, NC 27115

		
	 Clearwater Converting
	  	 1521 6th Avenue North

Lewiston, ID 83501

			
	 Name of Party
	  	 Address of Party

	 Dawn Distributors, Inc.
	  	 109 East Fudge Street

Covington, VA 24426

		
	 Denver Intermodal Express, Inc.
	  	 10700 East 40th Ave
 Denver,
CO 80239

		
	 Distribution Centers of the Americas
	  	 1850 Route 57
 Fulton,
NY 13069

		
	 ELM Global Logistics
	  	 50 Emjay Blvd
 Brentwood,
NY 11717

		
	 Empire Warehouse
	  	 1 Wright Avenue
 LeRoy,
NY 14482

		
	 Grand Warehouse
	  	 4350 West Ohio Street

Chicago, IL 60624

		
	 Hermann Warehouse Corporation
	  	 285 Ridge Road
 Dayton,
NJ 08810

		
	 Hydra Trucking and Warehousing
	  	 8151 Fruitridge Road Bldb 5B

Track 712, Polk, CA 95826

		
	 Imeson Distribution Center
	  	 550 Gun Club Road

Jacksonville, FL 32218

		
	 Inland 465
	  	 1730 3rd Avenue North

Lewiston, ID 83501

		
	 Inland Empire Distribution Systems, Inc.
	  	 3808 North Sullivan Road Bldg 32
 Spokane, WA 99216

		
	 Leicht Transfer & Storage Co.
	  	 1401 State Street
 Green
Bay, WI 54304

		
	 Lewis C. Howard Inc.
	  	 760 E. Vine Street

Kalamazoo, MI 49001

		
	 Loretta L. Transportation
	  	 240 South 6th Avenue
 City
of Industry, CA 91746

		
	 LTS Logistics
	  	 160 East Gregory Street
 N.
Little Rock, AR 72114

		
	 Manchester Industries
	  	26920 M-60, Mendon, MI 49072
		
	 Metro Park Warehouse
	  	 6901 Stilwell
 Kansas City,
MO 64120

		
	 Navarro Y Boronad, S.L.
	  	46730 Gandia-Puerto, Spain
		
	 Network Logistics, Inc.
	  	 1200 North 27th Ave
 DFW
Airport, TX 75261

		
	 Northwoods Converting
	  	 1322 North Spring Street

Beaver Dam, WI 53916

		
	 Port of Lewiston
	  	 1224 6th Ave. North

Lewiston, ID 83501

		
	 Roberds Converting
	  	 113 Northeast Drive

Loveland, OH 45140

		
	 Robinson Terminal Warehouse
	  	 1 Oronoco Street

Alexandria, VA 22314

			
	 Name of Party
	  	 Address of Party

	 Spicers Paper, Inc.
	  	 30108 Eigenbrodt Way
 Union
City, CA 94587

		
	 Spicers Paper, Inc.
	  	 12310 E. Slauson Avenue

Santa Fe Springs, CA 90670

		
	 Spicers Paper, Inc.
	  	 21429 64th Avenue South

Kent, WA 98023

		
	 Spicers Paper, Inc.
	  	 2454 South 3600 West Suite A,

West Valley City, UT 84119

		
	 Texas Star Warehouse
	  	 5200 E. Grand Avenue Bldg. 4,

Dallas, TX 75223

		
	 Union Gap Partnership
	  	 3301 Bay Street
 Union Gap,
WA 98903

		
	 Vogt Warehouse
	  	 1440 W 8th Street

Cincinnati, OH

		
	 Williams Paper Company
	  	 3914 Union Blvd
 St. Louis,
MO 63115

		
	 Interstate Distributor Co
	  	 1820 N. MacArthur Drive

Tracy, California 95376

		
	 Metro Canada Logistics
	  	 #50 6567 48th Street SE

Calgary, AB, T2C 3J7

		
	 Granger Co
	  	 2851 Wilma Drive
 Clarkston,
WA 99403

		
	 Granger Co
	  	 201 Highway 95
 New Meadows,
ID 83654

		
	 Swan Lake
	  	 318 Highland Drive
 St.
Maries, Idaho 83861

		
	 Fulghum Fibres, Inc.
	  	 251A Bradley 95
 Warren, AR
71671

		
	 Fulghum Fibres, Inc.
	  	 Hwy 82 West
 Poorhouse
Road
 Carrollton, MS 38917

		
	 QC Fibers of Dewitt LLC
	  	 129 Washington St.
 West
Helena, AR 72309

		
	 Weeks Forest Products
	  	 2600 Como Avenue
 St. Paul,
MN 55114

		
	 Weeks Forest Products
	  	 W 209 N 17270 Industry Drive

Jackson, WI 53037

 SCHEDULE 9.1.4 
 to 
 Loan and Security Agreement 

NAMES AND CAPITAL STRUCTURE 
  

	1.	The corporate names, jurisdictions of incorporation, and authorized and issued Equity Interests of each Borrower and Subsidiary are as follows:

 The following information is as of the date hereof: 

 

							
	 Name
	  	
Jurisdiction            
	  	 Number and Class
 Of Authorized Shares
	  	 Number and Class
 of Issued Shares

	Potlatch Forest Products Corporation	  	Delaware	  	 1,000 shares of common stock,

par value $1.00 per share
	  	 1,000 shares of common stock,

par value $1.00 per share

	
	After declaration of the spin-off by Potlatch Corporation’s board of directors:
				
	 Name
	  	
Jurisdiction            
	  	 Number and Class
 Of Authorized Shares
	  	 Number and Class
 of Issued Shares

	Clearwater Paper Corporation	  	Delaware	  	100,000,000 shares of common stock, par value $0.0001 per share	  	17,001,000 shares of common stock, par value $0.0001 per share
				
		  		  	 5,000,000 shares of preferred stock, par value $0.0001 per share
	  	

  

	2.	The record holders of Equity Interests of each Borrower and Subsidiary are as follows: 

Potlatch Forest Products Corporation is currently 100% owned by Potlatch Forest Holdings, Inc., which is in turn 100% owned by Potlatch
Corporation. After declaration of the spin-off but prior to the distribution, Potlatch Forest Holdings, Inc. will transfer all of the Clearwater Paper Corporation equity to Potlatch Corporation. In connection with the spin-off transaction, Potlatch
Corporation will transfer all of the shares of Clearwater Paper Corporation to the shareholders of Potlatch Corporation 
  

	3.	All agreements binding on holders of Equity Interests of Borrowers and Subsidiaries with respect to such interests are as follows: None, other than the spin-off
transaction documents. 

  

	4.	In the five years preceding the Closing Date, no Borrower or Subsidiary has acquired any substantial assets from any other Person nor been the surviving entity in a
merger or combination, except: None, other than (a) in connection with the transfers that occurred in connection with Potlatch Corporation’s conversion to a REIT, (b) certain land acquisitions, including the merger with Valley View
Land Company on July 23, 2008, and (c) the transactions contemplated by the Spin-Off Documents. 

 SCHEDULE 9.1.11 
 to 
 Loan and Security Agreement 

INTELLECTUAL PROPERTY 
 Trademarks 
  

	1.	“Clearwater” 

  

	2.	“Clearwater Paper” 

 SCHEDULE 9.1.14 
 to 
 Loan and Security Agreement 

ENVIRONMENTAL MATTERS 
 None. 

 SCHEDULE 9.1.15 
 to 
 Loan and Security Agreement 

RESTRICTIVE AGREEMENTS 
  

	1.	Agreements with counterparties identified in Schedule 10.2.2. 

  

	2.	Separation and Distribution Agreement, Tax Sharing Agreement, Employee Matters Agreement and Retained Obligation Agreement. 

 SCHEDULE 9.1.16 
 to 
 Loan and Security Agreement 

LITIGATION 
  

	1.	Proceedings and investigations pending against Borrowers or Subsidiaries that will be retained by Clearwater Paper Corporation in connection with the Spin-off: None.

  

	2.	Threatened proceedings or investigations of which any Borrower or Subsidiary is aware: None. 

 SCHEDULE 9.1.18 
 to 
 Loan and Security Agreement 

PENSION PLAN DISCLOSURES 
 None. 

 SCHEDULE 9.1.20 
 to 
 Loan and Security Agreement 

LABOR CONTRACTS 

1. Borrowers and Subsidiaries are party to the following collective bargaining agreements, management agreements and consulting agreements: 

Collective Bargaining Agreements 
  

			
	 Counterparty
	  	 Type of Agreement

	International Association of Machinists and Aerospace Workers	  	Collective Bargaining Agreement (Hourly employees at Lewiston Wood Products)
		
	International Association of Machinists and Aerospace Workers	  	Collective Bargaining Agreement (Hourly employees at Power Boiler #4)
		
	International Brotherhood of Electrical Workers	  	Collective Bargaining Agreement
		
	United Steel Workers	  	Collective Bargaining Agreement
		
	United Steel Workers	  	Collective Bargaining Agreement

 Management Agreements

  

	a.	Employment Agreement with Gordon L. Jones, dated July 28, 2008 

  

	b.	Offer Letter with Linda K. Massman, dated August 26, 2008 

  

	c.	Offer Letter with Thomas H. Carter, dated July 23, 2008 

  

	d.	The Borrower maintains customary compensation plans including an annual cash incentive pay plan, an equity incentive plan, a management deferred compensation plan, a
severance plan, pension plans, 401(k) savings plans and health and welfare plans. 

 2. As of September 30, 2008, 66% of the
Borrower’s workforce was unionized. The contract with the hourly employees at the lumber products facility and the Number 4 power boiler at the Idaho facility, who are represented by the International Association of Machinists and Aerospace
Workers, expired on May 31, 2008. Those employees currently continue to work without a union contract in place while discussions with the union continue. During 2009, one collective bargaining agreement will expire covering approximately 245
employees. As a result, there is a risk of work stoppage due to strikes or walkouts. Any significant work stoppage as a result of failure to successfully negotiate new collective bargaining agreements could have a material adverse effect on the
Borrower’s business, financial condition and results of operations. 

 SCHEDULE 10.2.2 
 to 
 Loan and Security Agreement 

EXISTING LIENS 
  

							
	 Secured Party’s Name
	  	Date	  	Filing Number	  	Jurisdiction
	 FCC Equipment Financing, Inc.
	  	8/2/01	  	1085172-0	  	Delaware
	 Omnova Solutions
	  	4/9/02	  	2088061-1	  	Delaware
	 ABB Structured Finance (Americas) Inc.
	  	5/16/02	  	2143631-4	  	Delaware
	 NMHG Financial Services Inc.
	  	1/15/03	  	3027909-4	  	Delaware
	 Citicorp Leasing, Inc.
	  	7/17/03	  	3181944-3	  	Delaware
	 IBM Credit LLC
	  	12/29/03	  	4015221-7	  	Delaware
	 Merrill Lynch Capital
	  	2/17/04	  	4043129-8	  	Delaware
	 General Electric Capital Corporation
	  	2/27/04	  	4056727-3	  	Delaware
	 Merrill Lynch Capital
	  	5/28/04	  	4149604-3	  	Delaware
	 Merrill Lynch Capital
	  	7/30/04	  	4215327-0	  	Delaware
	 Toyota Motor Credit Corporation
	  	10/21/04	  	4296684-6	  	Delaware
	 Caterpillar Financial Services Corporation
	  	11/9/04	  	4316034-0	  	Delaware
	 FCC Equipment Financing
	  	11/9/04	  	4316229-6	  	Delaware
	 US Bancorp Oliver-Allen Technology Leasing
	  	11/24/04	  	4331850-0	  	Delaware
	 The CIT Group/Equipment Financing, Inc.
	  	2/8/05	  	5051806-9	  	Delaware
	 Citicapital Commercial Leasing Corporation
	  	4/26/05	  	5127964-6	  	Delaware
	 Greatamerica Leasing Corporation
	  	5/4/05	  	5136627-8	  	Delaware
	 Barloworld Fleet Leasing LLC
	  	5/12/05	  	5146809-0	  	Delaware
	 CitiCapital Commercial Leasing Corporation
	  	7/12/05	  	5223959-9	  	Delaware
	 US Bancorp Oliver-Allen Technology Leasing
	  	8/5/05	  	5243005-7	  	Delaware
	 Barloworld Fleet Leasing LLC
	  	10/04/05	  	5306025-9	  	Delaware
	 Caterpillar Financial Services Corporation
	  	11/17/05	  	5356389-8	  	Delaware
	 Smurfit-Stone Container Enterprises, Inc.
	  	12/01/05	  	5371172-9	  	Delaware
	 Smurfit-Stone Container Enterprises, Inc.
	  	12/13/05	  	5386122-7	  	Delaware
	 NMHG Financial Services, Inc.
	  	5/30/06	  	6182308-7	  	Delaware
	 General Electric Capital Corporation
	  	6/28/06	  	6226317-6	  	Delaware
	 Samuel Strapping Systems
	  	11/02/07	  	74176243	  	Delaware
	 Smurfit-Stone Container Enterprises, Inc.
	  	11/13/07	  	74307053	  	Delaware
	 NMHG Financial Services, Inc.
	  	9/18/08	  	83167895	  	Delaware
	 Omnova Solutions, Inc.
	  	4/9/02	  	2088061-1	  	Delaware
	 Winthrop Resources Corporation
	  	3/22/06	  	6106497-1	  	Delaware
	 Winthrop Resources Corporation
	  	5/22/06	  	6178890-0	  	Delaware
	 Pacific Rim Capital, Inc.
	  	5/26/06	  	6180855-9	  	Delaware
	 Winthrop Resources Corporation
	  	11/22/06	  	6424847-2	  	Delaware
	 NMHG Financial Services, Inc.
	  	9/24/07	  	7359790-2	  	Delaware
	 Banc of America Leasing & Capital, LLC
	  	1/2/08	  	8000749-0	  	Delaware
	 Toyota Motor Credit Corporation
	  	1/14/08	  	8008263-4	  	Delaware
	 Toyota Motor Credit Corporation
	  	1/14/08	  	80163814	  	Delaware
	 TCF Equipment Finance, Inc.
	  	4/3/08	  	8124478-7	  	Delaware
	 TCF Equipment Finance, Inc.
	  	4/03/08	  	81170263	  	Delaware
	 Pacific Rim Capital, Inc.
	  	7/28/08	  	82582870	  	Delaware
	 Pacific Rim Capital, Inc.
	  	7/28/08	  	82583134	  	Delaware
	 Pacific Rim Capital, Inc.
	  	7/28/08	  	82583241	  	Delaware
	 Industrial Finishes & Systems, Inc.
	  	10/07/08	  	83398144	  	Delaware

							
	 Secured Party’s Name
	  	Date	  	Filing Number	  	Jurisdiction
	 Wells Fargo Financial Leasing, Inc.
	  	9/4/07	  	72479492-0	  	Washington
	 Toyota Motor Credit Corporation
	  	12/10/07	  	71923594-8	  	Minnesota

 SCHEDULE 10.2.17 
 to 
 Loan and Security Agreement 

EXISTING AFFILIATE TRANSACTIONS 
  

	1.	The Spin-Off Documents. 

  

	2.	Potlatch Corporation REIT conversion transaction agreements.Employee Matters Agreement

 Exhibit 10.5 

 
 EMPLOYEE MATTERS AGREEMENT 

by and between 

POTLATCH CORPORATION 
 and 
 CLEARWATER PAPER CORPORATION 

Dated as of December 15, 2008 

 TABLE OF CONTENTS 

 

			
	 	  	Page
	 ARTICLE I DEFINITIONS
	  	2
	 1.1        Action
	  	2
	 1.2        Affiliate
	  	2
	 1.3        Agreement
	  	2
	 1.4        Administrative Service Organization Contracts or ASO Contracts
	  	2
	 1.5        Assignment Agreement
	  	2
	 1.6        Clearwater
	  	2
	 1.7        Clearwater Common Stock
	  	2
	 1.8        Clearwater Employee
	  	3
	 1.9        Clearwater Group
	  	3
	 1.10      Clearwater Ratio
	  	3
	 1.11      Clearwater Stock Value
	  	3
	 1.12      Clearwater Terminated Employee
	  	3
	 1.13      COBRA
	  	3
	 1.14      Code
	  	3
	 1.15      Contract
	  	3
	 1.16      Director Deferred Compensation Plan
	  	4
	 1.17      Disability Plans
	  	4
	 1.18      Distribution
	  	4
	 1.19      Distribution Date
	  	4
	 1.20      DOL
	  	4
	 1.21      ERISA
	  	4
	 1.22      Executive Severance Plan
	  	4
	 1.23      Facilities
	  	4
	 1.24      Flexible Benefits Plan
	  	5
	 1.25      FMLA
	  	5
	 1.26      Fringe Benefits
	  	5
	 1.27      Frozen Supplemental Plan
	  	5
	 1.28      Governmental Entity
	  	5
	 1.29      Group Insurance Policies
	  	5
	 1.30      HCFA
	  	5
	 1.31      Health and Welfare Plans
	  	5
	 1.32      Health Plans
	  	6
	 1.33      Incentive Pay Plan.
	  	6
	 1.34      IRS
	  	6
	 1.35      Labor Agreements
	  	6
	 1.36      Law
	  	6
	 1.37      Leave of Absence Programs
	  	6
	 1.38      Liability or Liabilities
	  	6
	 1.39      Management Deferred Compensation Plan
	  	6
	 1.40      Material Feature
	  	6
	 1.41      Option
	  	7

  

 i 

			
	 1.42      Other Post-Retirement Benefits (OPEB) Program
	  	7
	 1.43      Outsource
	  	7
	 1.44      Participating Company
	  	7
	 1.45      Party or Parties
	  	7
	 1.46      PBGC
	  	7
	 1.47      Pension Plans
	  	7
	 1.48      Performance Shares
	  	7
	 1.49      Person
	  	8
	 1.50      Plan
	  	8
	 1.51      Potlatch
	  	8
	 1.52      Potlatch Common Stock
	  	8
	 1.53      Potlatch Employee
	  	8
	 1.54      Potlatch Group
	  	8
	 1.55      Potlatch Post-Distribution Stock Value
	  	8
	 1.56      Potlatch Pre-Distribution Stock Value
	  	8
	 1.57      Potlatch Ratio
	  	8
	 1.58      Potlatch Terminated Employee
	  	9
	 1.59      Premium Plan
	  	9
	 1.60      Pulp-Based Business
	  	9
	 1.61      QDRO
	  	9
	 1.62      QMCSO
	  	9
	 1.63      Record Date
	  	9
	 1.64      Restricted Stock Units
	  	9
	 1.65      RetainCo
	  	9
	 1.66      Retained Business
	  	10
	 1.67      Retirement Plans
	  	10
	 1.68      Salaried Severance Plan
	  	10
	 1.69      Savings Plans
	  	10
	 1.70      SEC
	  	10
	 1.71      Separation
	  	10
	 1.72      Separation Agreement
	  	10
	 1.73      Stock Incentive Plan
	  	10
	 1.74      Subsidiary
	  	10
	 1.75      Supplemental Benefit Plan
	  	11
	 1.76      Time Off Policies
	  	11
	 1.77      Transfer Amount
	  	11
	 1.78      Transfer Date
	  	11
	 1.79      Transition Services Agreement
	  	11
	 1.80      Unemployment Insurance Program
	  	11
	 1.81      Valuation Date
	  	11
	 1.82      Wood Products Mills
	  	11
		
	 ARTICLE II GENERAL PRINCIPLES
	  	13
	 2.1        Assumption of Liabilities
	  	13
	 2.2        Establishment of Plans
	  	13
	 2.3        Parties Under Certain Obligations to Maintain Plans
	  	14
	 2.4        Participation in Other Party’s Plans.
	  	14

  

 ii 

			
	 2.5        Terms of Participation.
	  	15
		
	 ARTICLE III DEFINED BENEFIT PENSION PLANS
	  	17
	 3.1        Establishment of Potlatch Pension Plans and Master Trust.
	  	17
	 3.2        Assumption of Liabilities and Transfer of Trust Assets.
	  	17
	 3.3        No Distributions to Potlatch Employees
	  	18
		
	 ARTICLE IV DEFINED CONTRIBUTION PLANS
	  	19
	 4.1        Establishment of Potlatch Savings Plans and Master Trust.
	  	19
		
	 ARTICLE V NON-QUALIFIED AND SUPPLEMENTAL PLANS
	  	21
	 5.1        Supplemental Benefit Plans.
	  	21
	 5.2        Deferred Compensation Plans.
	  	21
		
	 ARTICLE VI EQUITY AND OTHER MANAGEMENT COMPENSATION
	  	23
	 6.1        Incentive Pay Plans
	  	23
	 6.2        Clearwater Stock Incentive Plan
	  	23
	 6.3        Potlatch Options
	  	23
	 6.4        Potlatch Restricted Stock Units
	  	24
	 6.5        Potlatch Performance Shares
	  	24
	 6.6        Severance Plans
	  	25
	 6.7        Deferred Payment Contracts and Severance Contracts
	  	25
		
	 ARTICLE VII HEALTH AND WELFARE PLANS
	  	26
	 7.1        Establishment of Potlatch Health and Welfare Plans.
	  	26
	 7.2        Insured Health and Welfare Benefits
	  	26
	 7.3        Self-Insured Health and Welfare Benefits
	  	26
	 7.4        Disability Plans
	  	27
	 7.5        Outsourcing of Claims
	  	27
	 7.6        Post-Distribution Transitional Arrangements.
	  	27
	 7.7        Vendor Arrangements
	  	28
	 7.8        Business Travel Accident Insurance
	  	28
	 7.9        Flexible Benefits Plans
	  	28
	 7.10      COBRA
	  	28
	 7.11      Other Post-Retirement Benefits (OPEB) Programs
	  	29
		
	 ARTICLE VIII FRINGE AND OTHER BENEFITS
	  	30
	 8.1        Employee Assistance Program
	  	30
	 8.2        Educational Assistance Program.
	  	30
	 8.3        Other Benefits
	  	30
		
	 ARTICLE IX TRANSITION ADMINISTRATIVE PROVISIONS
	  	31
	 9.1        Transition Services Agreement
	  	31
	 9.2        Payment of Liabilities, Plan Expenses and Related Matters
	  	31
	 9.3        Sharing of Participant Information
	  	31
	 9.4        Reporting and Disclosure Communications to Participants
	  	31
	 9.5        Audits Regarding Vendor Contracts
	  	32

  

 iii 

			
	 9.6        Beneficiary Designations
	  	32
	 9.7        Requests for IRS, PBGC and DOL Opinions
	  	32
	 9.8        Fiduciary Matters
	  	32
	 9.9        Consent of Third Parties
	  	32
	 9.10      Tax Cooperation
	  	32
		
	 ARTICLE X EMPLOYMENT-RELATED MATTERS
	  	34
	 10.1      Terms of Employment
	  	34
	 10.2      Non-Solicitation of Employees
	  	34
	 10.3      Confidentiality and Proprietary Information
	  	34
	 10.4      Time Off Policies
	  	34
	 10.5      Payroll Systems.
	  	35
	 10.6      Personnel and Pay Records
	  	35
	 10.7      Unemployment Insurance Program.
	  	35
	 10.8      Non-Termination of Employment
	  	36
	 10.9      Leave of Absence Programs and FMLA.
	  	36
	 10.10    Employment Litigation
	  	36
	 10.11    Workers’ Compensation
	  	37
		
	 ARTICLE XI LABOR AGREEMENTS
	  	38
		
	 ARTICLE XII GENERAL PROVISIONS
	  	39
	 12.1      Relationship of Parties
	  	39
	 12.2      Incorporation of Separation Agreement Provisions
	  	39
	 12.3      Conflict
	  	39
	 12.4      Entire Agreement
	  	39
	 12.5      Choice of Law and Forum
	  	39
	 12.6      Amendment
	  	39
	 12.7      Waiver
	  	39
	 12.8      Partial Invalidity
	  	40
	 12.9      Execution in Counterparts
	  	40
	 12.10    Successors and Assigns
	  	40
	 12.11    No Third Party Beneficiaries
	  	40
	 12.12    Notices
	  	40
	 12.13    Performance
	  	41
	 12.14    Force Majeure
	  	41
	 12.15    No Public Announcement
	  	41
	 12.16    Termination
	  	41

  

 iv 

			
	 SCHEDULE 1.31 HEALTH AND WELFARE BENEFITS PLANS
	  	I
		
	 SCHEDULE 1.35 LABOR AGREEMENTS
	  	II
		
	 SCHEDULE 3.2(c)(i) ACTUARIAL ASSUMPTIONS FOR DEFINED BENEFIT PLAN TERMINATION BASIS DETERMINATIONS
	  	III
		
	 SCHEDULE 6.7 DEFERRED PAYMENT CONTRACTS AND SEVERANCE CONTRACTS
	  	IV
		
	 SCHEDULE 7.7(a) THIRD PARTY ASO CONTRACTS/PROFESSIONAL SERVICES
	  	V
		
	 SCHEDULE 7.7(b) GROUP INSURANCE POLICIES
	  	VI
		
	 SCHEDULE 8.3 FRINGE BENEFITS
	  	VIII

  

 v 

 EMPLOYEE MATTERS AGREEMENT 

This EMPLOYEE MATTERS AGREEMENT (this “Agreement”) is made as of December 15, 2008, by and between Potlatch
Corporation, a Delaware corporation, and Clearwater Paper Corporation, a Delaware corporation (formerly named Potlatch Forest Products Corporation) (each a “Party” and together, the “Parties”). Capitalized terms
used herein (other than the formal names of Plans (as defined below) and related trusts) and not otherwise defined, shall have the respective meanings assigned to them in Article I hereof. 

RECITALS 

WHEREAS, Potlatch and Clearwater have entered into a Separation and Distribution Agreement, dated as of the date hereof (the
“Separation Agreement”), in order to, among other things, separate the Retained Business from the Pulp-Based Business (the “Separation”); and 
 WHEREAS, in furtherance of the Separation, Potlatch and Clearwater have agreed to enter into this Agreement to allocate between them assets, liabilities and responsibilities with respect to certain
employee compensation, benefit Plans, and certain employment matters. 
 NOW, THEREFORE, in consideration of the mutual promises
contained herein, the Parties hereto agree as follows: 
  

 1 

 ARTICLE I 
 DEFINITIONS 
 Wherever used in this Agreement, the following terms
shall have the meanings indicated below, unless a different meaning is plainly required by the context. The singular shall include the plural, unless the context indicates otherwise. Headings of sections are used for convenience of reference only,
and in case of conflict, the text of this Agreement, rather than such headings, shall control. 
 1.1 Action.
“Action” means any action, claim, demand, suit, arbitration, inquiry, subpoena, discovery request, proceeding or investigation by or before any Governmental Entity or any arbitration tribunal, domestic or foreign. 

1.2 Affiliate. “Affiliate” means, as defined in the Separation Agreement, with respect to any Person, any other Person
that directly or indirectly controls, is controlled by or is under common control with such Person. For the purpose of this definition, the term “control” means the power to direct the management of an entity, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise; and the term “controlled” has the meaning correlative to the foregoing. After the Distribution, Potlatch and Clearwater shall not be deemed to be under common
control for purposes hereof due solely to the fact that Potlatch and Clearwater may have common stockholders. 
 1.3
Agreement. “Agreement” means this Employee Matters Agreement, including all the Addendums, Schedules and Exhibits hereto, and all amendments made hereto from time to time. 

1.4 Administrative Service Organization Contracts or ASO Contracts. “Administrative Service Organization Contracts” or
“ASO Contracts” is defined in Section 7.7(a) and the Schedule 7.7(a). 
 1.5 Assignment Agreement.
“Assignment Agreement” means the Transfer and Assumption Agreement, effective as of the date immediately prior to the Distribution Date, by and among Potlatch, RetainCo, and Clearwater. 

1.6 Clearwater. “Clearwater” means Clearwater Paper Corporation, a Delaware corporation, formerly named Potlatch Forest
Products Corporation. In all such instances in which Clearwater is referred to in this Agreement, it shall also be deemed to include a reference to each member of the Clearwater Group, unless the context specifically requires otherwise; Clearwater
shall be solely responsible to Potlatch for ensuring that each member of the Clearwater Group complies with the applicable terms of this Agreement. 
 1.7 Clearwater Common Stock. “Clearwater Common Stock” means, as defined in the Separation Agreement, Clearwater common stock, par value $0.0001 per share. 

 

 2 

 1.8 Clearwater Employee. “Clearwater Employee” means an individual who is:
(a) either actively employed primarily in connection with, or on leave of absence from, the Pulp-Based Business immediately prior to the Distribution Date; (b) a Clearwater Terminated Employee; (c) an employee or a member of a group
of employees designated as Clearwater Employees (as of the specified date(s)) by Potlatch and Clearwater by mutual written agreement; or (d) an alternate payee under a QDRO, alternate recipient under a QMCSO, beneficiary, covered dependent, or
qualified beneficiary (as such term is defined under COBRA), in each case, of an employee or former employee described in any of Sections 1.8(a) through (c) with respect to that employee’s or former employee’s benefit under the
applicable Plan(s) (unless specified otherwise in this Agreement, such an alternate payee, alternate recipient, beneficiary, covered dependent, or qualified beneficiary shall not otherwise be considered a Clearwater Employee with respect to any
benefits he or she accrues or accrued under any applicable Plan(s), unless he or she is a Clearwater Employee by virtue of any of Sections 1.8(a) through (c)). 
 1.9 Clearwater Group. “Clearwater Group” means, as defined in the Separation Agreement, Clearwater, its Subsidiaries and Affiliates (other than RetainCo), and any Subsidiaries or
Affiliates of Clearwater formed or acquired after the Distribution Date. 
 1.10 Clearwater Ratio. “Clearwater
Ratio” means the ratio determined by dividing the Clearwater Stock Value by the Potlatch Pre-Distribution Stock Value. 

1.11 Clearwater Stock Value. “Clearwater Stock Value” means the average per-share trading price of Clearwater Common
Stock as quoted on the New York Stock Exchange (“NYSE”) during the first four (4) hours of “regular way” trading in Clearwater Common Stock after the Distribution. 

1.12 Clearwater Terminated Employee. “Clearwater Terminated Employee” means an individual who was employed primarily in
connection with the Pulp-Based Business or a discontinued business specified or described on Schedule 2B or Schedule 19 to the Assignment Agreement and who terminated employment from the Pulp-Based Business or such discontinued business on or
before the Distribution Date; provided, however, that to the extent a former employee has not been, or cannot be, allocated in accordance with such Schedule, then such former employee shall be deemed a Potlatch Terminated Employee. Notwithstanding
the foregoing, “Clearwater Terminated Employee” shall not, unless otherwise expressly provided to the contrary in this Agreement, include an individual who is a Potlatch Employee on the Distribution Date. 

1.13 COBRA. “COBRA” means the continuation coverage requirements for “group health plans” under Title X
of the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended from time to time, and as codified in Code Section 4980B and ERISA Sections 601 through 608. 

1.14 Code. “Code” means, as defined in the Separation Agreement, the Internal Revenue Code of 1986, as amended.

 1.15 Contract. “Contract” means, as defined in the Separation Agreement, any agreement, license, contract,
obligation, indenture, instrument, lease, promise, arrangement, 
  

 3 

 
release, warranty, commitment or undertaking (whether written or oral and whether express or implied). 
 1.16 Director Deferred Compensation Plan. “Director Deferred Compensation Plan,” when immediately preceded by “Potlatch,” means the Potlatch Corporation Deferred Compensation
Plan for Directors II. When immediately preceded by “Clearwater,” “Director Deferred Compensation Plan” means the deferred compensation plan to be established by Clearwater pursuant to Sections 2.2 and 5.2 that corresponds
to the Potlatch Corporation Deferred Compensation Plan for Directors II. 
 1.17 Disability Plans. “Disability
Plans,” when immediately preceded by “Clearwater,” means the Clearwater short-term and long-term disability plans (including, where an employee works in a state that offers a statutory state disability plan, any alternative voluntary
state disability plan provided by Clearwater). When immediately preceded by “Potlatch,” “Disability Plans” means the short-term and long-term disability plans to be established or provided by Potlatch pursuant to Section 2.2
and Article VII that correspond to the Clearwater Disability Plans. 
 1.18 Distribution. “Distribution”
means, as defined in the Separation Agreement, the distribution on a pro rata basis to the holders of Potlatch’s Common Stock, without any consideration being paid by such holders, all of the outstanding shares of Clearwater Common Stock then
owned by Potlatch. 
 1.19 Distribution Date. “Distribution Date” means, as defined in the Separation
Agreement, the date determined by the Board of Directors of Potlatch as the date on which the Clearwater Common Stock is payable to holders of Potlatch Common Stock as of the Record Date. 

1.20 DOL. “DOL” means the United States Department of Labor. 

1.21 ERISA. “ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time. 

1.22 Executive Severance Plan. “Executive Severance Plan,” when immediately preceded by “Clearwater,” means
the Potlatch Forest Products Corporation Severance Program for Executive Employees, an ERISA severance program, to be retained by Clearwater. When immediately preceded by “Potlatch,” “Executive Severance Plan” means the severance
program for eligible executives to be established by Potlatch pursuant to Sections 2.2 and 6.6(a). 
 1.23 Facilities.
“Facilities” means, as defined in the Separation Agreement, each of the following mills and facilities: 
 (a) (i)
sawmill, (ii) pulp and paperboard mill and (iii) tissue mill and tissue converting facility at Lewiston, Idaho; 
 (b)
pulp and paperboard mill at Cypress Bend, Arkansas; 
  

 4 

 (c) tissue mill and converting facility in North Las Vegas, Nevada; and 

(d) tissue converting facility in Elwood, Illinois. 
 1.24 Flexible Benefits Plan. “Flexible Benefits Plan,” when immediately preceded by “Clearwater,” means the Clearwater Plan established pursuant to Code Section 125 for
eligible employees to make pre-tax contributions to flexible spending accounts. When immediately preceded by “Potlatch,” “Flexible Benefits Plan” means the Plan to be established by Potlatch for eligible employees to make pre-tax
contributions to flexible spending accounts pursuant to Section 2.2 and Article VII that corresponds to the respective Clearwater Flexible Benefits Plan. 
 1.25 FMLA. “FMLA” means the Family and Medical Leave Act of 1993, as amended from time to time. 
 1.26 Fringe Benefits. “Fringe Benefits,” when immediately preceded by “Clearwater,” means the Clearwater employee assistance program, the educational assistance program and
other fringe benefits, plans, programs and arrangements sponsored and maintained by Clearwater (as set forth in Article VIII and Schedule 8.3). When immediately preceded by “Potlatch,” “Fringe Benefits” means the
fringe benefits, plans, programs and arrangements to be established by Potlatch pursuant to Section 2.2 and Article VIII that correspond to the respective Clearwater Fringe Benefits. 

1.27 Frozen Supplemental Plan. “Frozen Supplemental Plan” is defined in Section 5.1(a). 

1.28 Governmental Entity. “Governmental Entity” means, as defined in the Separation Agreement, any nation or government,
any state, municipality or other political subdivision thereof and any entity, body, agency, commission, department, board, bureau or court, whether domestic, foreign or multinational, exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government; and any official thereof. 
 1.29 Group Insurance Policies.
“Group Insurance Policies” is defined in Section 7.7(b) and Schedule 7.7(b). 
 1.30 HCFA.
“HCFA” means the United States Health Care Financing Administration. 
 1.31 Health and Welfare Plans.
“Health and Welfare Plans,” when immediately preceded by “Clearwater,” means the Clearwater Health Plans, the Clearwater Flexible Benefit Plans, the Clearwater Premium Plan, the Clearwater Disability Plans and the other health
and welfare plans listed on Schedule 1.31 established and maintained by Clearwater for the benefit of employees and retirees of the Clearwater Group, and such other welfare plans or programs as may apply to such employees and retirees as
of the Distribution Date. When immediately preceded by “Potlatch,” “Health and Welfare Plans” means the Potlatch Health Plans, the Potlatch Flexible Benefit Plans, the Potlatch Premium Plan, the Potlatch Disability Plans and the
other health and welfare Plans to be established by Potlatch pursuant to Section 2.2 and Article VII that correspond to the respective Clearwater Health and Welfare Plans. 
  

 5 

 1.32 Health Plans. “Health Plans,” when immediately preceded by
“Clearwater,” means the Plans designated as Health Plans on Schedule 1.31, and any similar or successor Plans. When immediately preceded by “Potlatch,” “Health Plans” means the Plans providing health coverage and
benefits to be established by Potlatch pursuant to Section 2.2 and Article VII that correspond to the respective Clearwater Health Plans. 
 1.33 Incentive Pay Plan. “Incentive Pay Plan,” when immediately preceded by “Potlatch,” means either the Potlatch Corporation Management Performance Award Plan II or the
Potlatch Corporation Annual Incentive Plan, whichever is in effect as of the Distribution Date. When immediately preceded by “Clearwater,” “Incentive Pay Plan” means the incentive pay plan to be established by Clearwater pursuant
to Sections 2.2 and 6.1 that corresponds to the Potlatch Incentive Pay Plan. 
 1.34 IRS. “IRS” means, as
defined in the Separation Agreement, the Internal Revenue Service and any successor agency. 
 1.35 Labor Agreements.
“Labor Agreements” means the collective bargaining agreements set forth on Schedule 1.35. 
 1.36
Law. “Law” means, as defined in the Separation Agreement, any United States or non-United States federal, national, supranational, state, provincial, local or similar statute, law, ordinance, regulation, rule, code, order, consent
decree, requirement or rule of law (including common law and in equity). 
 1.37 Leave of Absence Programs. “Leave
of Absence Programs,” when immediately preceded by “Clearwater,” means the personal, medical, military and FMLA leave offered from time to time under the personnel policies and practices of Clearwater. When immediately preceded by
“Potlatch,” “Leave of Absence Programs” means the leave of absence programs to be established by Potlatch pursuant to Sections 2.2 and 10.9 that correspond to the respective Clearwater Leave of Absence Programs. 

1.38 Liability or Liabilities. “Liability” or “Liabilities” means, as defined in the Separation Agreement, any
and all debts, liabilities and obligations, absolute or contingent, matured or unmatured, liquidated or unliquidated, accrued or unaccrued, known or unknown, whenever arising, including all costs and expenses relating thereto, and including those
debts, liabilities and obligations arising under any Law, Action or threatened Action, or any award of any arbitrator of any kind, and those arising under any Contract. 
 1.39 Management Deferred Compensation Plan. “Management Deferred Compensation Plan,” when immediately preceded by “Potlatch,” means the Potlatch Corporation Management Deferred
Compensation Plan. When immediately preceded by “Clearwater,” “Management Deferred Compensation Plan” means the deferred compensation plan to be established by Clearwater pursuant to Sections 2.2 and 5.2 that corresponds to
the Potlatch Corporation Management Deferred Compensation Plan. 
 1.40 Material Feature. “Material Feature”
means any feature of a Plan that would reasonably be expected to be of material importance to the sponsoring employer or the participants (or their dependents or beneficiaries) (in the aggregate) of that Plan, which could 

 

 6 

 
include, depending on the type and purpose of the particular Plan, the class or classes of employees eligible to participate in such Plan, the nature, type, form, source, and level of benefits
provided under such Plan and the amount or level of contributions, if any, required to be made by participants (or their dependents or beneficiaries) to such Plan. 
 1.41 Option. “Option,” when immediately preceded by “Potlatch,” means an option to purchase Potlatch Common Stock pursuant to a Stock Incentive Plan. When immediately preceded
by “Clearwater,” “Option” means an option to purchase Clearwater Common Stock pursuant to a Stock Incentive Plan. 
 1.42 Other Post-Retirement Benefits (OPEB) Program. “Other Post-Retirement Benefits (OPEB) Program,” when immediately preceded by “Clearwater,” means the health and life
insurance programs that permit certain retirees and former employees of the Clearwater Group, and their eligible spouses and dependents to continue to receive coverage and benefits under certain Clearwater Health and Welfare Plans for a designated
period of time. When immediately preceded by “Potlatch,” “Other Post-Retirement Benefits (OPEB) Programs” means such continuation programs to be established by Potlatch pursuant to Sections 2.2 and 7.11 that correspond to
the Clearwater Other Post-Retirement Benefits (OPEB) Programs. 
 1.43 Outsource. “Outsource” is defined in
Section 7.5. 
 1.44 Participating Company. “Participating Company” means any Person (other than an
individual) whose employees participate in a Plan, other than the Plan sponsor. 
 1.45 Party or Parties.
“Party” or “Parties” has the meaning set forth in the first paragraph of this Agreement. 
 1.46
PBGC. “PBGC” means the Pension Benefit Guaranty Corporation. 
 1.47 Pension Plans. “Pension
Plans,” when immediately preceded by “Clearwater,” means the Potlatch Forest Products Corporation Salaried Employees’ Retirement Plan (the “Salaried Pension Plan”), the Potlatch Forest Products Corporation Retirement
Plan for Hourly Non-Represented Employees of the Idaho Operations of the Wood Products Division (the “Hourly Non-Represented Pension Plan”), and the Potlatch Forest Products Corporation Hourly Employees’ Retirement Plan (the
“Hourly Represented Pension Plan”). When immediately preceded by “Potlatch,” “Pension Plans” means the defined benefit plans to be established pursuant to Section 2.2 and Article III. 

1.48 Performance Shares. “Performance Shares” means, when preceded by “Potlatch,” awards denominated in shares
of Potlatch Common Stock pursuant to which the holder can earn, in whole or in part, the right to receive a specified number of shares of Potlatch Common Stock based upon attainment of performance objectives, pursuant to a Potlatch Stock Incentive
Plan. When preceded by “Clearwater,” “Performance Shares” means awards denominated in shares of Clearwater Common Stock pursuant to which the holder can earn, in whole or in part, the right to receive a specified number of shares
of Clearwater Common Stock based upon attainment of performance objectives, pursuant to a Clearwater Stock Incentive Plan. 
  

 7 

 1.49 Person. “Person” means, as defined in the Separation Agreement, any
individual, corporation, partnership, joint venture, limited liability company, association, joint-stock company, trust, unincorporated organization or Governmental Entity. 
 1.50 Plan. “Plan” means any plan, policy, program, payroll practice, arrangement, contract, trust, insurance policy, or any agreement or funding vehicle providing compensation or benefits
to employees, former employees or directors of Potlatch or Clearwater. 
 1.51 Potlatch. “Potlatch” means
Potlatch Corporation, a Delaware corporation. In all such instances in which Potlatch is referred to in this Agreement, it shall also be deemed to include a reference to each member of the Potlatch Group, unless the context specifically requires
otherwise; Potlatch shall be solely responsible to Clearwater for ensuring that each member of the Potlatch Group complies with the applicable terms of this Agreement. 
 1.52 Potlatch Common Stock. “Potlatch Common Stock” means, as defined in the Separation Agreement, Potlatch common stock, par value $1.00 per share. 

1.53 Potlatch Employee. “Potlatch Employee” means an individual who is: (a) either actively employed primarily in
connection with, or on leave of absence from, the Retained Business immediately prior to the Distribution Date; (b) a Potlatch Terminated Employee; (c) an employee or a member of a group of employees designated as Potlatch Employees (as of
the specified date(s)) by Potlatch and Clearwater by mutual written agreement; or (d) an alternate payee under a QDRO, alternate recipient under a QMCSO, beneficiary, covered dependent, or qualified beneficiary (as such term is defined under
COBRA), in each case, of an employee or former employee described in any of Sections 1.53(a) through (c) with respect to that employee’s or former employee’s benefit under the applicable Plan(s) (unless specified otherwise in
this Agreement, such an alternate payee, alternate recipient, beneficiary, covered dependent, or qualified beneficiary shall not otherwise be considered a Potlatch Employee with respect to any benefits he or she accrues or accrued under any
applicable Plan(s), unless he or she is a Potlatch Employee by virtue of any of Sections 1.53(a) through (c)). 
 1.54
Potlatch Group. “Potlatch Group” means, as defined in the Separation Agreement, Potlatch, its Subsidiaries and Affiliates (including RetainCo and those Subsidiaries and Affiliates formed or acquired after the date hereof), other
than members of the Clearwater Group. 
 1.55 Potlatch Post-Distribution Stock Value. “Potlatch Post-Distribution
Stock Value” means the average per-share trading price of Potlatch Common Stock as quoted on the New York Stock Exchange during the first four (4) hours of “ex-dividend” trading in Potlatch Common Stock after the Distribution.

 1.56 Potlatch Pre-Distribution Stock Value. “Potlatch Pre-Distribution Stock Value” means the closing
per-share price of Potlatch Common Stock as quoted on the New York Stock Exchange for trading in Potlatch Common Stock on the last trading day preceding the trading day on which Potlatch Common Stock first trades on an “ex-dividend” basis.

 1.57 Potlatch Ratio. “Potlatch Ratio” means the ratio determined by dividing the Potlatch Post-Distribution
Stock Value by the Potlatch Pre-Distribution Stock Value. 
  

 8 

 1.58 Potlatch Terminated Employee. “Potlatch Terminated Employee” means an
individual who was employed primarily in connection with the Retained Business or a discontinued business specified or described on Schedule 17 to the Assignment Agreement and who terminated employment from the Retained Business or such
discontinued business on or prior to the Distribution Date. In addition, a “Potlatch Terminated Employee” shall include a former employee who might otherwise be deemed a Clearwater Terminated Employee, but who has not been, or cannot be,
allocated as such pursuant to Section 1.12. Notwithstanding the foregoing, “Potlatch Terminated Employee” shall not, unless otherwise expressly provided to the contrary in this Agreement, include an individual who is a Clearwater
Employee on the Distribution Date. 
 1.59 Premium Plan. “Premium Plan,” when immediately preceded by
“Clearwater” means the Clearwater Plan established pursuant to Code Section 125 for eligible employees to pay for their coverage under the Health and Disability Plans with pre-tax contributions. When immediately preceded by Potlatch,
“Premium Plans” means the Plan to be established by Potlatch pursuant to Code Section 125 for eligible employees to pay for their coverage under the Health and Disability Plans with pre-tax contributions. 

1.60 Pulp-Based Business. “Pulp-Based Business” means, as defined in the Separation Agreement, Clearwater’s
consumer tissue products business, Clearwater’s pulp and paperboard business and the portion of Clearwater’s wood products business operated at Clearwater’s lumber mill in Lewiston, Idaho, which such businesses are generally comprised
of Clearwater’s ownership and operation of the Facilities and the sale of products manufactured at the Facilities. 
 1.61
QDRO. “QDRO” means a domestic relations order which qualifies under Code Section 414(p) and ERISA Section 206(d) and which creates or recognizes an alternate payee’s right to, or assigns to an alternate payee, all or
a portion of the benefits payable to a participant under any of the Retirement Plans. 
 1.62 QMCSO. “QMCSO”
means a medical child support order which qualifies under ERISA Section 609(a) and which creates or recognizes the existence of an alternate recipient’s right to, or assigns to an alternate recipient the right to, receive benefits for
which a participant or beneficiary is eligible under any of the Health Plans. 
 1.63 Record Date. “Record
Date” shall have the meaning assigned to it in Section 6.5(a). 
 1.64 Restricted Stock Units. “Restricted
Stock Units,” when immediately preceded by “Potlatch,” means awards denominated in shares of Potlatch Common Stock pursuant to which the holder has the right to receive a specified number of shares of Potlatch Common Stock over a
specified period of time, pursuant to a Potlatch Stock Incentive Plan. When immediately preceded by “Clearwater,” “Restricted Stock Units” means rights to receive shares of Clearwater Common Stock that are subject to transfer
restrictions or to employment or performance vesting conditions, pursuant to a Clearwater Stock Incentive Plan. 
 1.65
RetainCo. “RetainCo” means, as defined in the Separation Agreement, Potlatch Land & Lumber, LLC, a Delaware limited liability company. 
  

 9 

 1.66 Retained Business. “Retained Business” means, as defined in the
Separation Agreement, all of the current businesses and operations of Potlatch and its Affiliates other than the Pulp-Based Business, and includes: (a) the real estate business, which acquires and sells timberland and other real property, sells
conservation easements and undertakes certain land development activities, (b) the harvest and log sale business, which harvests standing timber and purchases and sells logs, (c) the wood products business, which is generally comprised of
Clearwater’s ownership and operation of the Wood Products Mills and the sale of wood products manufactured at the Wood Products Mills (for the avoidance of doubt, the Retained Business does not include the portion of Clearwater’s wood
products business operated at Clearwater’s lumber mill in Lewiston, Idaho), and (d) the timberland management business that manages Potlatch timberlands. 
 1.67 Retirement Plans. “Retirement Plans,” when immediately preceded by “Clearwater,” means the Clearwater Pension Plans and the Clearwater Savings Plans. When immediately
preceded by “Potlatch,” “Retirement Plans” means the Potlatch Pension Plans and Potlatch Savings Plans. 

1.68 Salaried Severance Plan. “Salaried Severance Plan,” when immediately preceded by “Clearwater,” means the
Potlatch Forest Products Corporation Salaried Severance Benefit Plan, an ERISA severance program, to be retained by Clearwater. When immediately preceded by “Potlatch,” “Salaried Severance Plan” means the severance program to be
established by Potlatch pursuant to Section 6.6(b). 
 1.69 Savings Plans. “Savings Plans,” when
immediately preceded by “Clearwater,” means the Potlatch Forest Products Corporation Savings Plan for Hourly Employees and the Potlatch Forest Products Corporation Salaried Employees’ Savings Plan. When immediately preceded by
“Potlatch,” “Savings Plans” means the defined contribution Plans to be established by Potlatch pursuant to Section 2.2 and Article IV. 
 1.70 SEC. “SEC” means, as defined in the Separation Agreement, means the United States Securities and Exchange Commission. 

1.71 Separation. “Separation” means, as defined in the Separation Agreement, the separation of the Retained Business
from the Pulp-Based Business. 
 1.72 Separation Agreement. “Separation Agreement” shall have the meaning set
forth in the recitals. 
 1.73 Stock Incentive Plan. “Stock Incentive Plan,” when immediately preceded by
“Potlatch,” means any plan, program or arrangement pursuant to which directors, employees and other service providers hold Potlatch Options, Potlatch Restricted Stock Units, Potlatch Performance Shares or other Potlatch equity incentives.
When immediately preceded by “Clearwater,” “Stock Incentive Plan” means the Plans to be established by Clearwater pursuant to Sections 2.2 and 6.2. 
 1.74 Subsidiary. “Subsidiary” means, as defined in the Separation Agreement, when used with reference to any Person, any corporation, limited liability company, partnership or other
organization of which at least a majority of the securities or interests having by the terms 
  

 10 

 
thereof ordinary voting power to elect at least a majority of the board of directors or others performing similar functions with respect to such corporation or other organization is directly or
indirectly owned or controlled by such Person; provided, however, that no Person that is not directly or indirectly wholly owned by any other Person shall be a Subsidiary of such other Person unless such other Person controls, or has the right,
power or ability to control, that Person. After the Distribution, Potlatch and Clearwater shall not be deemed to be under common control for purposes hereof due solely to the fact that Potlatch and Clearwater may have common stockholders.

 1.75 Supplemental Benefit Plan. “Supplemental Benefit Plan,” when immediately preceded by
“Clearwater,” means the Potlatch Forest Products Corporation Salaried Employees’ Supplemental Benefit Plan II. When immediately preceded by “Potlatch,” “Supplemental Benefit Plan” means the non-qualified
supplemental excess benefit retirement plan to be established by Potlatch pursuant to Sections 2.2 and 5.1 that corresponds to the Clearwater Supplemental Benefit Plan. 
 1.76 Time Off Policies. “Time Off Policies,” when immediately preceded by “Clearwater,” means the Clearwater vacation, holidays and other time off policies. When immediately
preceded by “Potlatch,” “Time Off Policies” means the vacation, holidays and other time off policies to be established by Potlatch pursuant to Sections 2.2 and 10.4 that correspond to the Clearwater Time Off Policies.

 1.77 Transfer Amount. “Transfer Amount” shall have the meaning assigned to it in Section 3.2(c)(ii).

 1.78 Transfer Date. “Transfer Date” shall have the meaning assigned to it in Section 3.2(c)(ii).

 1.79 Transition Services Agreement. “Transition Services Agreement” means, as defined in the Separation
Agreement, the Transition Services Agreement, dated the date hereof, between RetainCo and Clearwater. 
 1.80 Unemployment
Insurance Program. “Unemployment Insurance Program,” when immediately preceded by “Clearwater,” means the group unemployment insurance policies purchased by Clearwater from time to time. When immediately preceded by
“Potlatch,” “Unemployment Insurance Program” means any group unemployment insurance policies to be established by Potlatch pursuant to Section 10.7. 
 1.81 Valuation Date. “Valuation Date” shall have the meaning assigned to it in Section 3.2(c)(ii). 
 1.82 Wood Products Mills. “Wood Products Mills” means, as defined in the Separation Agreement, each of the following mills and facilities: 

(a) sawmill in Prescott, Arkansas (which was permanently closed in May 2008); 

(b) sawmill in Warren, Arkansas; 
  

 11 

 (c) (i) sawmill, (ii) dry kilns and (iii) plywood mill in St. Maries, Idaho;

 (d) sawmill in Bemidji, Minnesota; 
 (e) sawmill in Gwinn, Michigan; and 
 (f) particleboard mill in Post Falls, Idaho.

  

 12 

 ARTICLE II 
 GENERAL PRINCIPLES 
 2.1 Assumption of Liabilities.

 (a) Clearwater Employees. Except as specified otherwise in this Agreement, or as mutually agreed upon in writing by
Clearwater and Potlatch from time to time, Clearwater hereby retains, or, as applicable, assumes and agrees to pay, perform, fulfill and discharge, in accordance with their respective terms, all of the following: (i) all Liabilities to or
relating to Clearwater Employees, in each case relating to, arising out of or resulting from employment prior to the Distribution Date (including Liabilities to or relating to Clearwater Employees arising under, relating to or resulting from
Potlatch Plans or Clearwater Plans and including Liabilities to or relating to Clearwater Employees under or relating to workers compensation Laws or claims); (ii) all Liabilities to or relating to Clearwater Employees, to the extent relating
to, arising out of, or resulting from employment with the Clearwater Group on and after the Distribution Date (including Liabilities to or relating to Clearwater Employees arising under, relating to or resulting from Clearwater Plans); and
(iii) all other Liabilities relating to, arising out of, or resulting from obligations, liabilities and responsibilities expressly assumed or retained by the Clearwater Group, or a Clearwater Plan, pursuant to this Agreement. 

(b) Potlatch Employees. Except as specified otherwise in this Agreement, or as mutually agreed upon in writing by Clearwater and
Potlatch from time to time, Potlatch hereby retains, or, as applicable, assumes and agrees to pay, perform, fulfill and discharge, in accordance with their respective terms, all of the following: (i) all Liabilities to or relating to Potlatch
Employees, in each case relating to, arising out of or resulting from employment prior to the Distribution Date (including Liabilities to or relating to Potlatch Employees arising under, relating to or resulting from Potlatch Plans or Clearwater
Plans and including Liabilities to or relating to Potlatch Employees, under or relating to workers compensation Laws or claims); (ii) all Liabilities to or relating to Potlatch Employees, to the extent relating to, arising out of, or resulting
from employment with the Potlatch Group on and after the Distribution Date (including Liabilities to or relating to Potlatch Employees arising under or relating to Potlatch Plans); and (iii) all other Liabilities relating to, arising out of, or
resulting from obligations, liabilities and responsibilities expressly assumed or retained by the Potlatch Group, or a Potlatch Plan, pursuant to this Agreement. 
 2.2 Establishment of Plans. Effective as of the Distribution Date or such later date(s) as Potlatch and Clearwater may mutually agree in writing: 

(a) Potlatch shall adopt the Potlatch Pension Plans as provided in Article III; 

(b) Potlatch shall adopt the Potlatch Savings Plans as provided in Article IV; 

 

 13 

 (c) Potlatch shall adopt the Potlatch Supplemental Benefit Plan, and Clearwater shall adopt
the Clearwater Management Deferred Compensation Plan and the Clearwater Director Deferred Compensation Plan, as provided in Article V; 
 (d) Clearwater shall adopt the Clearwater Incentive Pay Plan and the Clearwater Stock Incentive Plan, and Potlatch shall adopt the Potlatch Salaried Severance Plan and the Potlatch Executive Severance
Plan, as provided in Article VI; 
 (e) Potlatch shall adopt the Potlatch Health and Welfare Plans and the Potlatch Other
Post-Retirement Benefits (OPEB) Program, as provided in Article VII; 
 (f) the Parties shall establish the Fringe Benefit
and other Plans as provided in Article VIII; and 
 (g) Potlatch shall establish the Potlatch Time Off Policies and the
Potlatch Leave of Absence Programs, as provided in Article X. 
 2.3 Parties Under Certain Obligations to Maintain Plans.
Clearwater and Potlatch agree that they each will continue to maintain and sponsor their respective Plans on the terms and conditions in effect immediately prior to the Distribution Date, as modified by this Agreement, for at least twelve
(12) months from the Distribution Date; provided, however, that: (a) any such Plan can be amended or otherwise altered with regard to any individual who is not a current employee of a Party as of the Distribution Date; (b) any such
Plan can be amended to ensure compliance with applicable law, or to maintain its tax-favored, tax-qualified or tax-exempt status; and (c) any such Plan can be amended, modified, merged, terminated, or otherwise altered to ensure compliance with
a Labor Agreement. Except as specified in this Section 2.3 or a Labor Agreement, nothing in this Agreement shall otherwise preclude Potlatch or Clearwater, at any time after twelve (12) months from the Distribution Date, from amending,
merging, modifying, terminating, eliminating, reducing, or otherwise altering in any respect any of their respective Plans, any benefit under any of their respective Plans or any trust, insurance policy or funding vehicle related to any of their
respective Plans. 
 2.4 Participation in Other Party’s Plans. 

(a) General Obligations as Plan Sponsor. To the extent that, after the Distribution Date, Clearwater is a Participating Company in
any Potlatch Plan or Potlatch is a Participating Company in any Clearwater Plan, Potlatch and Clearwater (as applicable) shall continue to administer, or cause to be administered, in accordance with their terms and applicable Law, their respective
Plans, and shall have the sole and absolute discretion and authority to interpret their respective Plans, as set forth therein. Notwithstanding the foregoing, neither Party shall, without first consulting with the other Party, amend any Material
Feature of a Plan in which the other Party is a Participating Company, except to the extent such amendment would not affect any benefits of the other Party’s employees under such Plan or as may be necessary or appropriate to comply with
applicable law or a Labor Agreement. 
 (b) General Obligations as Participating Company. To the extent that, after the
Distribution Date, Clearwater is a Participating Company in any Potlatch Plan or Potlatch is a Participating Company in any Clearwater Plan, Clearwater or Potlatch (as applicable) shall 
  

 14 

 
perform with respect to its participation in the other Party’s Plan, the duties of a Participating Company as set forth in each such Plan or any procedures adopted pursuant thereto,
including (without limitation): (i) assisting in the administration of claims, to the extent requested by the claims administrator of the applicable Plan; (ii) cooperating fully with Plan auditors, benefit personnel and benefit vendors;
(iii) preserving the confidentiality of all financial arrangements the Plan sponsor has or may have with any vendors, claims administrators, trustees or any other entity or individual with whom the Plan sponsor has entered into an agreement
relating to the Plan; and (iv) preserving the confidentiality of participant information (including, without limitation, health information in relation to FMLA leaves) to the extent not specified otherwise in this Agreement. 

2.5 Terms of Participation. 
 (a) Non-Duplication of Benefits. As of the Distribution Date or such later date that applies to the particular Plan established thereafter, (i) the Potlatch Plans shall be, with respect to
Potlatch Employees, in all respects the successors in interest to, and shall not provide benefits that duplicate benefits provided by, the corresponding Clearwater Plans, and (ii) the Clearwater Plans shall be, with respect to Clearwater
Employees, in all respects the successors in interest to, and shall not provide benefits that duplicate benefits provided by, the corresponding Potlatch Plans. Potlatch and Clearwater shall agree on methods and procedures, including amending their
respective Plan documents, to prevent Potlatch Employees and Clearwater Employees from receiving duplicate benefits from the Potlatch Plans and the Clearwater Plans. 
 (b) Service Credit. Except as specified otherwise in this Agreement, to the extent that Potlatch and Clearwater establish new Plans to replace and succeed the existing Plans maintained by the other
Party prior to the Distribution Date, they shall cause their respective Plans to recognize all service, all compensation and all other benefit-affecting determinations that, as of the Distribution Date, were recognized under the corresponding Plan
maintained by the other Party, except to the extent that duplication of benefits would result. Notwithstanding the foregoing: (i) Potlatch and Clearwater shall recognize service with either Potlatch or Clearwater that was recognized as of the
Distribution Date, except to the extent provided in Section 2.5(a) above, and (ii) Potlatch and Clearwater shall each recognize and grant service credit to any employee who is employed by the Potlatch Group or the Clearwater Group,
terminated from such employment and then hired by the other Party as an employee at any time during the twelve (12) month period following the Distribution Date; provided, however, no service credit shall be required for any such period that
he/she is not employed by either the Potlatch Group or the Clearwater Group. The service crediting provisions shall be subject to any respective applicable “service bridging,” “break in service,” “vesting service,”
“employment date,” or “eligibility date” rules under the Clearwater Plans and the Potlatch Plans. 
 (c)
Assumption of Liabilities. The provisions of this Agreement for the transfer of assets from certain Clearwater Plans to the appropriate Potlatch Plans are based upon the understanding of the Parties that the appropriate Potlatch Plan will
assume all Liabilities to or relating to Potlatch Employees under the corresponding Clearwater Plan, as provided for herein. If any such Liabilities are not effectively assumed by the appropriate Potlatch Plan, then the amount of transferred assets
shall be recomputed accordingly, taking into account the retention of such Liabilities by such Clearwater Plan, and assets shall be transferred from the appropriate 

 

 15 

 
Potlatch Plan to the appropriate Clearwater Plan so as to place the appropriate Potlatch Plan in the position it would have been in, had the initial asset transfer been made in accordance with
such recomputed amount of assets. 
  

 16 

 ARTICLE III 
 DEFINED BENEFIT PENSION PLANS 
 3.1 Establishment of Potlatch
Pension Plans and Master Trust. 
 (a) Pension Plans. Effective as of January 1, 2009, Potlatch shall establish,
or cause to be established, the Potlatch Salaried Pension Plan and the Potlatch Hourly Represented Pension Plan, which shall be substantially identical in all Material Features to the corresponding Clearwater Pension Plans as in effect on
December 31, 2008. The sponsorship of the existing Clearwater Hourly Non-Represented Pension Plan shall be transferred from Clearwater to Potlatch as of January 1, 2009, and, as of the Distribution Date, Potlatch shall assume all
liabilities relating to such Plan. 
 (b) Master Trust. Effective as of January 1, 2009, Potlatch shall establish,
or cause to be established, a new master trust which is intended to be exempt from taxation under Code Section 501(a), to hold the assets of the Potlatch Pension Plans. 
 3.2 Assumption of Liabilities and Transfer of Trust Assets. 
 (a)
Assumption of Liabilities. Subject to the completion of each of the asset allocations and transfers described in Section 3.2(b) and (c), effective as of January 1, 2009, (i) all accrued benefits of the Potlatch Employees under
each of the Clearwater Pension Plans shall be transferred to the corresponding Potlatch Pension Plan, and (ii) each such Potlatch Pension Plan shall assume and be solely responsible for all Liabilities for or relating to the accrued benefits of
the Potlatch Employees under the corresponding Clearwater Pension Plan. 
 (b) Hourly Non-Represented Pension Plan. In
conjunction with the assumption by Potlatch of the sponsorship of the Clearwater Hourly Non-Represented Pension Plan, all of the assets of the Clearwater Hourly Non-Represented Pension Plan shall be transferred from the existing trust established
under such Plan to the master trust established by Potlatch pursuant to Section 3.1(b). 
 (c) Salaried Pension Plan and
Hourly Represented Pension Plan. 
 (i) As soon as reasonably practicable after the Distribution Date, the
Parties shall engage an enrolled actuary to determine for each of the Clearwater Salaried Pension Plan and the Clearwater Hourly Represented Pension Plan, the total accrued benefit Liabilities as of the Distribution Date for all participants in such
Plans, calculated on a plan termination basis in accordance with Title IV of ERISA. The particular actuarial assumptions that will be used to value the benefit Liabilities described in the preceding sentence shall be set forth in Schedule
3.2(c)(i) hereto. The enrolled actuary shall allocate such accrued Liabilities to the priority categories described in ERISA Section 4044 and shall determine, for each such priority category, the amount of accrued Liabilities attributable
to Potlatch Employees and the amount of accrued Liabilities attributable to Clearwater Employees. 
  

 17 

 (ii) As soon as reasonably practicable after the determinations described in
Section 3.2(c)(i), the Parties shall designate a date for valuing the assets of each of the Clearwater Salaried Pension Plan and the Clearwater Hourly Represented Pension Plan (the “Valuation Date”), and a date as soon as
practicable after the Valuation Date on which there shall occur the initial transfer of assets from each such Clearwater Pension Plan to the corresponding Potlatch Pension Plan (the “Transfer Date”). The fair market value of the
assets of each such Clearwater Pension Plan as of the Valuation Date (excluding the effect of any contributions made to such Clearwater Pension Plan after the Distribution Date and any distributions made by the Clearwater Pension Plan to Potlatch
Employees after the Distribution Date) shall be allocated to the priority categories of accrued Liabilities determined under Section 3.2(c)(i), in the order specified under ERISA Section 4044, until all such assets have been fully
allocated. On the Transfer Date, the amount of assets allocated to the accrued Liabilities attributable to Potlatch Employees in each of the priority categories (the “Transfer Amount”) shall be transferred from the trust established
under the Clearwater Pension Plans to the trust established under the Potlatch Pension Plans, and Potlatch shall cause the trust established under its Plans to accept such transfer. The Parties agree and acknowledge that a second Transfer Date will
likely be necessary to reconcile any erroneous transfers and provide for an interest adjustment. Such additional Transfer Date, if necessary, shall occur as soon as administratively feasible following the Transfer Date but in no event later than
December 31, 2009. 
 (iii) Notwithstanding the foregoing, in no event shall the Transfer Amount be less
than the minimum amount required to satisfy the requirements of Code Section 414(l) and the regulations thereunder. 
 (iv) Each of the Parties shall bear an equal portion of the cost of the enrolled actuary’s determinations under this Section 3.2(c). 

3.3 No Distributions to Potlatch Employees. The Clearwater and Potlatch Pension Plans shall provide that no distribution of
retirement benefits shall be made to any Potlatch Employee on account of the Potlatch Group ceasing to be an Affiliate of the Clearwater Group as of the Distribution Date. 

 

 18 

 ARTICLE IV 
 DEFINED CONTRIBUTION PLANS 
 4.1 Establishment of Potlatch
Savings Plans and Master Trust. 
 (a) Savings Plans. Effective as of the Distribution Date or such other date as
Potlatch and Clearwater may mutually agree in writing, Potlatch shall establish, or cause to be established, the Potlatch Savings Plans, which shall be substantially identical in all Material Features to the corresponding Clearwater Savings Plans as
in effect on the Distribution Date. 
 (b) Master Trust. Effective as of the Distribution Date or such other date as the
Parties agree to in Section 4.1(a), Potlatch shall establish, or cause to be established, a new master trust, which is intended to be exempt from taxation under Code Section 501(a), to hold the assets of the Potlatch Savings Plans.

 (c) Assumption of Liabilities and Transfer of Assets. Effective as of the Distribution Date: (i) each Potlatch
Savings Plan shall assume and be solely responsible for all Liabilities for or relating to Potlatch Employees under the corresponding Clearwater Savings Plan, subject to the completion of the asset transfers; and (ii) Clearwater shall cause the
accounts of the Potlatch Employees under each Clearwater Savings Plan that are held by its related trust as of the Distribution Date to be transferred to the corresponding Potlatch Savings Plan and related trust, and Potlatch shall cause such
transferred accounts to be accepted by each such Potlatch Plan and related trust. As soon as reasonably practicable after the Distribution Date, Potlatch shall use its commercially reasonable efforts to enter into agreements satisfactory to Potlatch
to accomplish such assumption and transfer, the maintenance of the necessary participant records, the appointment of an initial trustee under the Potlatch Savings Plans, and the engagement of an initial record keeper under the Potlatch Savings
Plans. Clearwater and Potlatch each agree to use their commercially reasonable efforts to effectuate this Section 4.1. 

(d) Stock Fund Considerations. As a result of the Distribution and the transfers of liabilities and assets described in
Section 4.1(c), each Clearwater Savings Plan and each Potlatch Savings Plan shall include investment funds comprised of Potlatch Common Stock and Clearwater Common Stock. Clearwater and Potlatch shall assume sole responsibility for ensuring
that their respective company stock funds, and underlying employer securities held in each such fund, are maintained in compliance with all requirements of the SEC including, without limitation, filing Forms S-8 and 11-K, and the prospectus
requirements for such funds. Notwithstanding Section 2.3 or any other provision in this Agreement, on and after the Distribution Date, nothing shall preclude either Clearwater or Potlatch from imposing restrictions through their respective
Savings Plans on future investments in securities issued by the other Party, or from discontinuing any investment fund holding securities issued by the other Party. 
 (e) No Distribution to Potlatch Employees. The Potlatch and Clearwater Savings Plans shall provide that no distribution of account balances shall be made to any

  

 19 

 
Potlatch Employee on account of the Potlatch Group ceasing to be an Affiliate of the Clearwater Group as of the Distribution Date. 
  

 20 

 ARTICLE V 
 NON-QUALIFIED AND SUPPLEMENTAL PLANS 
 5.1 Supplemental Benefit
Plans. 
 (a) Establishment of Potlatch Supplemental Benefit Plan. Effective as of the Distribution Date, Potlatch
shall establish the Potlatch Supplemental Benefit Plan that shall be substantially identical in all Material Features to the Clearwater Supplemental Benefit Plan. Potlatch shall continue to sponsor the Potlatch Corporation Salaried Employees’
Supplemental Benefit Plan, which was frozen as of December 31, 2004 (the “Frozen Supplemental Plan”). 

(b) Assumption of Liabilities by Potlatch Supplemental Benefit Plan. Effective as of the Distribution Date, all accrued benefits
of Potlatch Employees under the Clearwater Supplemental Benefit Plan shall be transferred to the Potlatch Supplemental Benefit Plan. The Potlatch Supplemental Benefit Plan shall assume and be solely responsible for all Liabilities for or relating to
the accrued benefits of the Potlatch Employees under the Clearwater Supplemental Benefit Plan as of the Distribution Date. 

(c) Assumption of Liabilities by Clearwater Supplemental Benefit Plan. Effective as of the Distribution Date, all accrued benefits
of Clearwater Employees under the Frozen Supplemental Plan shall be transferred to the Clearwater Supplemental Benefit Plan. The Clearwater Supplemental Benefit Plan shall assume and be solely responsible for all Liabilities for or relating to the
accrued benefits of the Clearwater Employees under the Frozen Supplemental Plan as of the Distribution Date. 
 5.2 Deferred
Compensation Plans. 
 (a) Establishment of Clearwater Deferred Compensation Plans. Effective as of the Distribution
Date, Clearwater shall establish the Clearwater Management Deferred Compensation Plan and the Clearwater Director Deferred Compensation Plan, which shall be substantially identical in all Material Features to the Potlatch Management Deferred
Compensation Plan and the Potlatch Director Deferred Compensation Plan, respectively. 
 (b) Assumption of Liabilities by
Clearwater Management Deferred Compensation Plan. Effective as of the Distribution Date, all deferred compensation benefits of Clearwater Employees under the Potlatch Management Deferred Compensation Plan shall be transferred to the Clearwater
Management Deferred Compensation Plan. The Clearwater Management Deferred Compensation Plan shall assume and be solely responsible for all Liabilities for or relating to the deferred compensation benefits of the Clearwater Employees under the
Potlatch Management Deferred Compensation Plan as of the Distribution Date. 
 (c) Clearwater Assumption of Other Management
Deferred Compensation Liabilities. Effective as of the Distribution Date, all deferred compensation benefits of Clearwater Employees under the Potlatch Corporation Management Performance Award Plan and the Potlatch Corporation Management
Performance Award Plan II shall be transferred to the 
  

 21 

 
Clearwater Management Deferred Compensation Plan or to an alternative plan or plans established by Clearwater. Such Clearwater Plan or Plans shall assume and be solely responsible for all
Liabilities for or relating to the deferred compensation benefits of the Clearwater Employees under such Potlatch Plans. 
 (d)
Director Deferred Compensation Liabilities. Potlatch shall retain all Liabilities to current and former directors of Potlatch under the Potlatch Director Deferred Compensation Plan and any predecessor deferred compensation Plans for Potlatch
directors. Clearwater shall establish the Clearwater Director Deferred Compensation Plan to provide benefits for directors of Clearwater comparable to those provided under the Potlatch Director Deferred Compensation Plan. 

(e) Treatment of Stock Units. With respect to the deferred compensation benefits under the Potlatch Plans described in this
Section 5.2 that have been deemed invested in “stock units” (units denominated in shares of Potlatch Common Stock) prior to the Distribution Date, the following provisions shall apply: 

(i) Potlatch shall cause the number of stock units allocated to each deferred compensation account to be adjusted as of
the Distribution Date. The adjusted number of units shall equal the number of units allocated to the account immediately prior to the Distribution Date divided by the Potlatch Ratio, rounded to three (3) decimal places. 

(ii) For account balances that will be assumed by the Clearwater Plans, Clearwater shall assume the obligation to treat
such accounts as deemed invested in Potlatch stock units, as adjusted by Potlatch pursuant to Section 5.2(e)(i). Notwithstanding the foregoing, Clearwater shall be permitted to give Clearwater Employees and Clearwater directors an election to
have their Potlatch stock units converted into Clearwater stock units (units denominated in shares of Clearwater Common Stock) as of the Distribution Date, in lieu of the adjustment described in Section 5.2(e)(i). For Clearwater Employees and
directors who make such an election, the number of Clearwater stock units allocated to each such account as a result of such conversion shall equal the total number of Potlatch stock units allocated to the account immediately prior to the
Distribution Date divided by the Clearwater Ratio, rounded to three (3) decimal places. 
 (f) No Distributions to
Potlatch or Clearwater Employees. Potlatch and Clearwater agree that the Separation and Distribution shall not be viewed as a separation from service or other termination of employment entitling Potlatch Employees or Clearwater Employees or
other participants in the Plans described in this Article V to distributions of their deferred compensation benefits. Potlatch and Clearwater shall cause their respective deferred compensation Plans to be amended (if necessary) and to be
administered in a manner consistent with this understanding. 
  

 22 

 ARTICLE VI 
 EQUITY AND OTHER MANAGEMENT COMPENSATION 
 6.1 Incentive Pay
Plans. Clearwater Employees shall cease participating in the Potlatch Incentive Pay Plan as of the Distribution Date. Clearwater shall establish the Clearwater Incentive Pay Plan to provide annual incentive bonuses for periods beginning on or
after the Distribution Date. The Clearwater Incentive Pay Plan may, but is not required to, contain the same Material Features as the Potlatch Incentive Pay Plan. Notwithstanding the foregoing, if the Distribution Date occurs in 2008 or in 2009
prior to the date when 2008 bonuses would be payable under the Potlatch Incentive Pay Plan, Clearwater shall assume the obligation to pay 2008 bonuses to the Clearwater Employees (such bonuses to be determined as if the Clearwater Employees had
continued to participate in the Potlatch Incentive Pay Plan for all of 2008), and Potlatch shall have no responsibility for the payment of 2008 bonuses to the Clearwater Employees. 

6.2 Clearwater Stock Incentive Plan. Clearwater shall establish the Clearwater Stock Incentive Plan to provide equity incentives
to Clearwater Employees after the Distribution Date. The Clearwater Stock Incentive Plan may, but is not required to, contain the same Material Features as the Potlatch Stock Incentive Plan. 

6.3 Potlatch Options. 
 (a) Adjustment of Potlatch Options. As of the Distribution Date, each outstanding Potlatch Option held by Potlatch Employees and Clearwater Employees shall be, in connection with the Distribution,
adjusted by Potlatch. Each such Potlatch Option shall continue to have, and be subject to, the same terms and conditions set forth in the Potlatch Stock Incentive Plans and as provided in the respective option agreements governing such Potlatch
Option as of the Distribution Date, except that (i) such Potlatch Option shall be exercisable for that number of whole shares of Potlatch Common Stock equal to the number of shares of Potlatch Common Stock that were issuable upon exercise of
such Potlatch Option as of the Distribution Date divided by the Potlatch Ratio, rounded up to the nearest whole share, and (ii) the per share exercise price for the shares of Potlatch Common Stock issuable upon exercise of such Potlatch Option
shall be equal to the exercise price per share at which such Potlatch Option was exercisable as of the Distribution Date multiplied by the Potlatch Ratio, rounded to four (4) decimal places. 

(b) Potlatch Options Held by Clearwater Employees. In addition to the adjustment described in Section 6.3(a), Potlatch shall
amend the Options held by Clearwater Employees to provide that the Separation and Distribution shall not give rise to a forfeiture of the Options held by the Clearwater Employees after ninety (90) days from the Distribution Date, so that they
can exercise the Options in accordance with their terms, subject to continued employment with Clearwater. Upon the request of Potlatch in connection with the exercise of an Option held by a Clearwater Employee and in order to determine whether such
Option is being 
  

 23 

 
validly exercised by the Clearwater Employee, Clearwater shall confirm to Potlatch such Clearwater Employee’s current employment status with Clearwater. 

6.4 Potlatch Restricted Stock Units. 
 (a) Adjustment of Potlatch Restricted Stock Units. As of the Distribution Date, each outstanding Potlatch Restricted Stock Unit held by Potlatch Employees, whether vested or unvested, shall be, in
connection with the Distribution, adjusted by Potlatch. Each such Potlatch Restricted Stock Unit shall continue to have, and be subject to, the same terms and conditions set forth in the Potlatch Stock Plans and as provided in the respective award
agreements governing such Potlatch Restricted Stock Unit as of the Distribution Date, except that the number of shares of Potlatch Common Stock for which such Potlatch Restricted Stock Unit can be settled shall be equal to the number of shares of
Potlatch Common Stock that were issuable upon settlement of such Potlatch Restricted Stock Unit as of the Distribution Date divided by the Potlatch Ratio, rounded to three (3) decimal places. 

(b) Potlatch Restricted Stock Units Held by Clearwater Employees. Potlatch Restricted Stock Units held by Clearwater Employees
shall be forfeited as of the Distribution Date in accordance with the terms of the applicable award agreements. Clearwater shall be responsible for issuing cash incentives or equity incentives based on Clearwater Common Stock, which may include
Clearwater Restricted Stock Units, to provide a substitute of comparable value for such terminated Potlatch Restricted Stock Units. 
 6.5 Potlatch Performance Shares. 
 (a) Adjustment of Potlatch
Performance Shares for the 2006-2008 Performance Period. Prior to the record date for the Distribution (the “Record Date”), each outstanding Potlatch Performance Share award held by a Potlatch Employee or Clearwater Employee for
the 2006-2008 performance period shall be settled by Potlatch. Each such Potlatch Performance Share award shall continue to have, and be subject to, the same terms and conditions set forth in the Potlatch Stock Incentive Plans and as provided in the
respective award agreements governing such Potlatch Performance Shares, except that the determination of the extent to which the performance goals for the 2006-2008 period shall have been attained shall be made as of the last day of the calendar
quarter preceding the Record Date. 
 (b) Adjustment of Potlatch Performance Shares for the 2007-2009 and 2008-2010
Performance Periods. As of the Distribution Date, each outstanding Potlatch Performance Share award held by Potlatch Employees for the 2007-2009 and 2008-2010 performance periods, whether vested or unvested, shall be, in connection with the
Distribution, adjusted by Potlatch. Each such Potlatch Performance Share award shall continue to have, and be subject to, the same terms and conditions set forth in the Potlatch Stock Incentive Plans and as provided in the respective award
agreements governing such Potlatch Performance Shares as of the Distribution Date, except that (i) the number of shares of Potlatch Common Stock for which such Potlatch Performance Share award can be settled shall be equal to the number of
shares of Potlatch Common Stock that were issuable upon settlement of such Potlatch Performance Share award as of the Distribution Date divided by the Potlatch Ratio, rounded to three (3) decimal places, and

  

 24 

 
(ii) the Distribution shall be treated as a dividend for purposes of measuring attainment of the total shareholder return performance objectives. 

(c) Potlatch Performance Shares Held by Clearwater Employees. Potlatch Performance Share Awards for the 2006-2008 performance
periods that are held by Clearwater Employees shall be settled and paid in the manner described in Section 6.5(a). Potlatch Performance Share awards for the 2007-2009 and 2008-2010 performance periods held by Clearwater Employees shall be
forfeited as of the Distribution Date in accordance with the terms of the applicable award agreements. Clearwater shall be responsible for issuing cash incentives or equity incentives based on Clearwater Common Stock, which may include Clearwater
Performance Share awards, to provide a substitute of comparable value for such terminated Potlatch Performance Share awards. 

6.6 Severance Plans. 
 (a) Executive Severance Plan. Effective as of the Distribution Date, Potlatch shall establish the Potlatch Executive Severance Plan that shall be substantially identical in all Material Features to
the Clearwater Executive Severance Plan. 
 (b) Salaried Severance Plan. Effective as of the Distribution Date, Potlatch
shall establish the Potlatch Salaried Severance Plan that shall be substantially identical in all Material Features to the Clearwater Salaried Severance Plan. 
 (c) No Separation from Service. The Parties agree that the Separation and Distribution shall not be considered a separation from service or termination of employment entitling Potlatch Employees or
Clearwater Employees to be eligible to participate in or to receive payment of severance benefits under the Executive Severance Plans or Salaried Severance Plans. Potlatch and Clearwater shall cause their respective Executive Severance Plans and
Salaried Severance Plans to be amended (if necessary) and to be administered in a manner consistent with this understanding. 

6.7 Deferred Payment Contracts and Severance Contracts. All Liabilities with respect to, and all responsibilities for
administering, the deferred payment contracts and severance contracts for the individuals listed on Schedule 6.7 shall be allocated between the Parties as set forth on Schedule 6.7. 

 

 25 

 ARTICLE VII 
 HEALTH AND WELFARE PLANS 
 7.1 Establishment of Potlatch Health
and Welfare Plans. 
 (a) New Plans. Effective as of January 1, 2009, Potlatch shall establish, or cause to be
established, the Potlatch Health and Welfare Plans which shall be substantially identical in all Material Features to the corresponding Clearwater Health and Welfare Plans as in effect on the Distribution Date. Potlatch shall cause the Potlatch
Health and Welfare Plans to be responsible for all claims incurred by Potlatch Employees on and after January 1, 2009 (subject to the terms of such Plans). 
 (b) Existing Arrangement. Clearwater, as sponsor of the existing Health and Welfare Plans through December 31, 2008, agrees not to make any modification, amendment or other change to any
Health and Welfare Plan without Potlatch’s consent through December 31, 2008. 
 7.2 Insured Health and Welfare
Benefits. Effective as of the Distribution Date and through December 31, 2008, Potlatch shall be liable to Clearwater for premiums owed for coverage for Potlatch Employees under the Clearwater Health and Welfare Plans (other than the
Disability Plan). 
 7.3 Self-Insured Health and Welfare Benefits. 

(a) Administration of Claims of Potlatch Employees. Clearwater shall cause the Clearwater Health and Welfare Plans, other than
Disability Plans, to administer all claims incurred by Potlatch Employees and Clearwater Employees under such Plans prior to January 1, 2009, including claims incurred but not yet reported prior to January 1, 2009. The Clearwater Health
and Welfare Plans, other than Disability Plans, shall be responsible for claims incurred (including claims incurred but not yet reported) prior to January 1, 2009. Potlatch shall be liable to Clearwater for any such claims incurred by Potlatch
Employees from the Distribution Date through December 31, 2008. Thereafter, the Potlatch Health and Welfare Plans, other than Disability Plans, shall be responsible for and assume Liability for claims incurred on or after January 1, 2009.
For this purpose, a claim shall be deemed to be incurred: 
 (i) when an individual obtains professional
services, equipment or prescription drugs covered by a medical, prescription drug, dental or vision benefit plan; 
 (ii) upon death in the case of a life insurance plan; and 
 (iii)
as of the date of the accident or injury in the case of an accidental death and dismemberment or business travel accident plan. 

(b) Clearwater Health Plans. Notwithstanding the foregoing, the Clearwater Health Plans shall be responsible for but not liable
for the cost of all professional services, 
  

 26 

 
equipment and prescription drugs provided during a hospital stay or similar confinement of a Potlatch Employee that begins prior to January 1, 2009, and ends after January 1, 2009
(subject to the terms and conditions of the Clearwater Health Plans). Potlatch shall be liable to Clearwater for any and all such costs incurred by Potlatch Employees from the Distribution Date through the end of such stay or confinement.
Thereafter, the Potlatch Health Plans shall be responsible and assume related Liability for the cost of all professional services, equipment and prescription drugs provided during a hospital stay or similar confinement of a Potlatch Employee that
begins on or after January 1, 2009 (subject to the terms and conditions of the Potlatch Health Plans). 
 7.4 Disability
Plans. Effective as of the Distribution Date and through December 31, 2008, the Disability Plans will be administered by Clearwater as set forth in the Transition Services Agreement. Effective as of the Distribution Date, Potlatch shall
assume responsibility and accompanying Liability for any Potlatch Employee who is absent from work on account of a short term disability. Furthermore, effective as of the Distribution Date and through December 31, 2008, Potlatch shall be liable
to Clearwater for premiums owed for long-term disability coverage for Potlatch Employees under the Clearwater Disability Plans. Effective as of January 1, 2009, the Potlatch Disability Plans (short-term and long-term) shall assume
responsibility and accompanying Liability for Potlatch Employees. 
 7.5 Outsourcing of Claims. Potlatch and Clearwater
shall have the right to engage a third party administrator, vendor, or insurance company to administer (“Outsource”) claims incurred under their respective Health and Welfare Plans, including claims incurred before January 1, 2009.
Each Party may determine the manner and extent of such Outsourcing, including the selection of one or more third party administrators, vendors, or insurance companies and the ability to transfer the Liability for such claims to one or more
independent insurance companies. 
 7.6 Post-Distribution Transitional Arrangements. 

(a) Transition Period. Both Clearwater and Potlatch will participate in the Clearwater Health and Welfare Plans through
December 31, 2008. Accordingly, Potlatch shall reimburse Clearwater for any and all direct and indirect expenses and costs for claims incurred through December 31, 2008, by Potlatch Employees. 

(b) Continuance of Elections, Co-Payments and Maximum Benefits. 

(i) As of January 1, 2009, Potlatch shall cause the Potlatch Health and Welfare Plans to recognize and maintain all
coverage and contribution elections made by Potlatch Employees under the Clearwater Health and Welfare Plans and apply such elections under the Potlatch Health and Welfare Plans for the remainder of the period or periods for which such elections are
by their terms applicable. The direct transfer or other movement of employment between Potlatch and Clearwater at any time upon or before January 1, 2009, shall neither constitute nor be treated as a “status change” or termination of
employment under the Potlatch Health and Welfare Plans or the Clearwater Health and Welfare Plans. 
  

 27 

 (ii) On and after January 1, 2009, Potlatch shall cause the Potlatch
Health Plans to recognize and give credit for all benefits paid to Potlatch Employees under the Clearwater Health Plans for purposes of determining when such persons have reached their lifetime maximum benefits under the Potlatch Health Plans.

 (c) HCFA Administration. As of the Distribution Date, Potlatch shall assume all Liabilities relating to, arising out
of or resulting from claims verified by Potlatch or Clearwater under the HCFA data match reports that relate to Potlatch Employees. 
 7.7 Vendor Arrangements. The Parties shall use their commercially reasonable efforts to enable Potlatch to procure, effective as of January 1, 2009: (a) third party ASO Contracts with the
Material Features of the ASO Contracts entered into by Clearwater, as set forth in Schedule 7.7(a) (the “ASO Contracts”); and (b) Group Insurance Policies, with the Material Features of the Group Insurance Policies
entered into by Clearwater, as set forth in Schedule 7.7(b) (the “Group Insurance Policies”). In each case, Potlatch shall, as of January 1, 2009, be responsible for establishing, adopting and implementing such
contracts, agreements and arrangements for the Potlatch Health and Welfare Plans, and Clearwater shall be responsible for maintaining such contracts, agreements and arrangements for the Clearwater Health and Welfare Plans. 

7.8 Business Travel Accident Insurance. Potlatch shall procure a business travel accident insurance policy with the Material
Features of the Clearwater business travel accident policy, effective as of the Distribution Date. 
 7.9 Flexible Benefits
Plans. Through December 31, 2008, Potlatch and designated members of the Potlatch Group shall remain Participating Companies in the Clearwater Flexible Benefits Plan. The existing elections for Potlatch Employees shall remain in effect
through December 31, 2008. Potlatch shall reimburse Clearwater for any and all direct and indirect expenses and costs attributable to Potlatch Employees through December 31, 2008. Effective as of January 1, 2009, Potlatch shall
establish, or caused to be established, the Potlatch Flexible Benefits Plan and shall be solely responsible for implementing and maintaining the Potlatch Flexible Benefits Plan. The Potlatch Flexible Benefits Plan shall be Liable for any and all
outstanding claims incurred and made by Potlatch Employees attributable to their 2008 elections after December 31, 2008, in accordance with the terms of the Potlatch Flexible Benefits Plan. Accordingly, Clearwater and Potlatch shall each take
all actions necessary to cause a spin-off of the portion of the Clearwater Flexible Benefits Plan covering Potlatch Employees to the Potlatch Flexible Benefits Plan for the outstanding recordkeeping account balances after December 31, 2008, in
accordance with Revenue Ruling 2002-32 and subsequent guidance thereunder. Such actions shall include, but not be limited to, a transfer by or on behalf of Clearwater to Potlatch of the amount equal to participant contributions to the Clearwater
Flexible Benefits Plan from January 1, 2008 through the Distribution Date, less the participant reimbursements for such period. 
 7.10 COBRA. Clearwater shall be responsible through December 31, 2008, for compliance with the health care continuation coverage requirements of COBRA and the Clearwater Health and Welfare
Plans with respect to Potlatch Employees and qualified beneficiaries (as such term is defined under COBRA). On or about December 31, 2008, 
  

 28 

 
Clearwater shall provide Potlatch, through hard copy, electronic format or such other mechanism as is appropriate under the circumstances, with a list of all qualified beneficiaries (as such term
is defined under COBRA) that relate to the Potlatch Group and the relevant information pertaining to their coverage elections and remaining COBRA time periods. Effective as of January 1, 2009, Potlatch shall be solely responsible for compliance
with the health care continuation coverage requirements of COBRA and the Potlatch Health and Welfare Plans for Potlatch Employees and their qualified beneficiaries (as such term is defined under COBRA). 

7.11 Other Post-Retirement Benefits (OPEB) Programs. 
 (a) Administration. As soon as reasonably practicable after December 31, 2008, Clearwater shall provide to Potlatch, through hard copy, electronic format or such other mechanism as is
appropriate under the circumstances, a list detailing all Potlatch Employees who are, to the knowledge of Clearwater, eligible to participate in the Clearwater Other Post-Retirement Benefits Program as of January 1, 2009, and the type of
coverage and level of coverage for which they are eligible, as applicable. Effective as of January 1, 2009, Clearwater shall be solely responsible for the administration of the Clearwater Other Post-Retirement Benefits (OPEB) Program for
Clearwater Employees, and Potlatch shall be solely responsible for the administration of the Potlatch Other Post-Retirement Benefits (OPEB) Program for the Potlatch Employees. 
 (b) Assumption of Liabilities. Effective as of January 1, 2009, (i) the Potlatch Other Post-Retirement Benefits (OPEB) Program shall assume and be solely responsible for any and all
Liabilities for or relating to Potlatch Employees under the corresponding Clearwater Other Post-Retirement Benefits (OPEB) Program, and (ii) the Clearwater Other Post-Retirement Benefits (OPEB) Program shall assume and be solely responsible for
any and all Liabilities for or relating to Clearwater Employees under the Clearwater Other Post-Retirement Benefits (OPEB) Program. 
 (c) Transition Period. Potlatch shall reimburse Clearwater for any and all direct and indirect expenses and costs attributable to the Potlatch Employees’ coverage under the Clearwater Other
Post-Retirement Benefits (OPEB) Program from the Distribution Date through December 31, 2008 (or such other date as the Parties may mutually agree upon in writing). 

 

 29 

 ARTICLE VIII 
 FRINGE AND OTHER BENEFITS 
 8.1 Employee Assistance Program.
The Parties shall use their commercially reasonable efforts to procure, effective as of the Distribution Date or such other date as Potlatch and Clearwater may mutually agree in writing, contracts and arrangements with Clearwater’s vendors to
establish an employee assistance program for Potlatch Employees that contains the Material Features of the existing contracts and arrangements of Clearwater’s employee assistance program. Potlatch shall cease to be a Participating Company in
the Clearwater employee assistance program coincident with Potlatch’s establishment of the Potlatch employee assistance program. 
 8.2 Educational Assistance Program. 
 (a) Establishment of Educational
Assistance Program. Effective as of the Distribution Date or such other date as Clearwater and Potlatch may mutually agree in writing, each Party shall provide an educational assistance program to its respective Employees that have the Material
Features of the Clearwater educational assistance program. Potlatch shall cease to be a Participating Company in the Clearwater educational assistance program coincident with Potlatch’s establishment of the Potlatch educational assistance
program. 
 (b) Reimbursement of Expenses. As of the Distribution Date, any and all outstanding approved reimbursements
under the Clearwater educational assistance program for Potlatch Employees shall be made by Potlatch. Potlatch and Clearwater each agree to be responsible for providing benefits to their respective Employees who are enrolled in a class or other
program as of the Distribution Date for which approval has been granted under the Clearwater educational assistance program on or before the Distribution Date. 
 8.3 Other Benefits. To the extent that Potlatch or Clearwater maintains, sponsors or provides other fringe benefits including, without limitation, the benefits specified in Schedule 8.3
to its employees, then each Party shall, to the extent permitted by law, continue to make such benefits available to Clearwater Employees and Potlatch Employees, respectively, on substantially similar terms and conditions as are currently offered
through the Distribution Date or such other date upon which Clearwater and Potlatch mutually agree in writing. Each Party shall reimburse the other Party for any and all direct and indirect costs and expenses arising out of or relating to or
resulting from making any such fringe benefits available to the other Party’s employees. Clearwater and Potlatch agree to make commercially reasonable efforts to mutually agree in writing, whether, when, and on what terms any member of the
Clearwater Group and Potlatch Group shall maintain, sponsor or offer fringe benefits. 
  

 30 

 ARTICLE IX 
 TRANSITION ADMINISTRATIVE PROVISIONS 
 9.1 Transition Services
Agreement. On the date hereof, Potlatch and Clearwater have entered into the Transition Services Agreement covering the provision of various interim services, including financial, accounting, legal, and other services between the Parties.

 9.2 Payment of Liabilities, Plan Expenses and Related Matters. For the period from the Distribution Date until such
date as each Party maintains its own Plan(s), the following provisions shall be in effect: 
 (a) Shared Costs. Each
Party shall pay its share, as mutually determined by Clearwater in good faith, of any contributions made to any trust maintained in connection with a Clearwater Plan while the Parties both participate in that Clearwater Plan. 

(b) Contributions to Trusts. With respect to Plans to which Potlatch Employees make contributions, Clearwater shall use reasonable
procedures to determine Potlatch’s Liabilities associated with such Plans, taking into account such contributions, settlements, refunds and similar payments. 
 (c) Administrative Expenses Not Chargeable to a Trust. Plan administration expenses shall be allocated in the manner described in Article IX of the Separation Agreement to the extent not
(i) charged pursuant to the Transition Services Agreement or another provision of this Agreement, (ii) otherwise mutually agreed to in writing by Potlatch and Clearwater, or (iii) chargeable to a trust established in connection with a
Clearwater Plan or a Potlatch Plan. 
 9.3 Sharing of Participant Information. In addition to the responsibilities and
obligations of Potlatch and Clearwater specified in Article XII of the Separation Agreement, Potlatch and Clearwater shall share, or cause to be shared, all participant information that is necessary or appropriate for the efficient and accurate
administration of each of the Potlatch Plans and the Clearwater Plans during the respective periods applicable to such Plans as Clearwater and Potlatch may mutually agree in writing. Potlatch and Clearwater and their respective authorized agents
shall, subject to applicable laws of confidentiality and data protection, duplicate all files no matter in what format relating to the subjects of this Agreement and that are in the custody of the other Party or its agents, to the extent necessary
or appropriate for such administration. 
 9.4 Reporting and Disclosure Communications to Participants. While Potlatch is
a Participating Company in the Clearwater Plans or Clearwater is a Participating Company in the Potlatch Plans, each Party shall take, or cause to be taken, all actions necessary or appropriate to facilitate the distribution of all Plan-related
communications and materials to its respective Employees, participants and beneficiaries, including (without limitation) summary plan descriptions and related summaries of material modification(s), summary annual reports, investment information,
prospectuses, notices and enrollment materials. The Parties shall assist 
  

 31 

 
each other in complying with all reporting and disclosure requirements of ERISA for their respective Plans, including the preparation of Form Series 5500 annual reports, where applicable.

 9.5 Audits Regarding Vendor Contracts. From the period beginning as of the Distribution Date and ending eight
(8) years thereafter, or such earlier date as Potlatch and Clearwater may mutually agree in writing, Potlatch and Clearwater and their duly authorized representatives shall have the right to conduct joint audits with respect to any vendor
contracts that relate to both the Potlatch Plans and the Clearwater Plans. The scope of such audits shall encompass the review of all correspondence, account records, claim forms, canceled drafts (unless retained by the bank), provider bills,
medical records submitted with claims, billing corrections, vendor’s internal corrections of previous errors and any other documents or instruments relating to the services performed by the vendor under the applicable vendor contracts. Potlatch
and Clearwater shall agree on the performance standards, audit methodology, auditing policy and quality measures, reporting requirements, and the manner in which costs incurred in connection with such audits will be allocated between the Parties.

 9.6 Beneficiary Designations. Subject to Section 9.9, all beneficiary designations made by Potlatch Employees
under Clearwater Plans, and all beneficiary designations made by Clearwater Employees under Potlatch Plans, shall be transferred to and be in full force and effect under the corresponding Plans established by the other Party until such beneficiary
designations are replaced or revoked by the Potlatch Employee or Clearwater Employee who made the beneficiary designation. 

9.7 Requests for IRS, PBGC and DOL Opinions. Potlatch and Clearwater shall make such applications to regulatory agencies,
including the PBGC, IRS and DOL, as may be reasonable under the circumstances. Clearwater and Potlatch shall cooperate fully with one another on any issue relating to the transactions contemplated by this Agreement for which Potlatch or Clearwater
elects to seek a determination letter or private letter ruling from the IRS or an advisory opinion from the DOL. 
 9.8
Fiduciary Matters. Potlatch and Clearwater each acknowledge that actions contemplated to be taken pursuant to this Agreement may be subject to fiduciary duties or standards of conduct under ERISA or other applicable law, and no Party shall be
deemed to be in violation of this Agreement if such Party fails to comply with any provisions hereof based upon such Party’s good faith determination that to do so would violate such a fiduciary duty or standard. 

9.9 Consent of Third Parties. If any provision of this Agreement is dependent on the consent of any third party (such as a vendor)
and such consent is withheld, Potlatch and Clearwater shall use commercially reasonable efforts to implement the applicable provisions of this Agreement. If any provision of this Agreement cannot be implemented due to the failure of such third party
to consent, Potlatch and Clearwater shall negotiate in good faith to implement the provision in a mutually satisfactory manner. 

9.10 Tax Cooperation. In connection with the interpretation and administration of this Agreement, Potlatch and Clearwater shall
take into account the agreements and policies 
  

 32 

 
established pursuant to the Separation Agreement and the parties’ intent to qualify the Distribution as a tax-free reorganization under Code Sections 368(a)(1)(D) and 355. 

 

 33 

 ARTICLE X 
 EMPLOYMENT-RELATED MATTERS 
 10.1 Terms of Employment. All
basic terms and conditions of employment for Potlatch Employees and Clearwater Employees, in each case, who are not subject to a Labor Agreement including, without limitation, their pay and benefits in the aggregate, shall remain substantially the
same as the terms and conditions that were in place immediately prior to the Distribution Date for twelve (12) months from the Distribution Date, unless otherwise mutually agreed in writing by the Parties. Notwithstanding the foregoing or any
other provision of the Separation Agreement or this Agreement, the employees of the Potlatch Group or the Clearwater Group, in each case, who are not subject to a Labor Agreement or an employment agreement that specifically provides otherwise shall
remain at-will employees and the Potlatch Group and the Clearwater Group may terminate their respective employees at any time for any reason. 
 10.2 Non-Solicitation of Employees. Potlatch and Clearwater each agree not to directly solicit or recruit the other Party’s employees for a period of two (2) years following the
Distribution Date, if such solicitation or recruitment would be disruptive or damaging or would interfere with the operation or business of the other Party. Notwithstanding the foregoing, this prohibition on solicitation does not apply to actions
taken by a Party either: (a) as a result of an employee’s affirmative response to a general recruitment effort carried out through a public solicitation or general solicitation, or (b) as a result of an employee’s initiative.

 10.3 Confidentiality and Proprietary Information. No provision of the Separation Agreement or this Agreement shall be
deemed to release any Potlatch Employee or Clearwater Employee for any violation of any non-competition guideline or any agreement or policy pertaining to confidential or proprietary information of any member of the Potlatch Group or Clearwater
Group, or otherwise relieve any such individual of his or her obligations under such non-competition guideline, agreement, or policy. 
 10.4 Time Off Policies. Effective as of the Distribution Date, Potlatch shall establish the Potlatch Time Off Policies that are identical in all Material Features to the Clearwater Time Off
Policies. Effective as soon as reasonably practicable after the Distribution Date (or such other date as Potlatch and Clearwater may mutually agree in writing), (a) Clearwater shall transfer to Potlatch all data and information relating to the
Clearwater Time Off Policies; and (b) Potlatch shall assume all Liabilities attributable to Potlatch Employees under the Clearwater Time Off Policies. In the event that a Potlatch Employee or Clearwater Employee transfers his or her employment
to the other Party before the Distribution Date, such transfer of employment shall not result in a payout or constitute a termination event for purposes of the Time Off Policies, and no duplication of benefits shall occur as a result of any such
transfer of employment between Potlatch and Clearwater. Furthermore, the Liability attributable to any Clearwater Employee or Potlatch Employee who transfers employment between Potlatch and Clearwater prior to the Distribution Date shall be assumed
by the employer subsequent to the transfer. 
  

 34 

 10.5 Payroll Systems. 

(a) Clearwater Payroll System. Effective on and after the Distribution Date, and subject to the Transition Services Agreement,
Clearwater shall perform payroll services for Potlatch. 
 (b) Income Reporting, Withholding. Commencing with service
periods beginning after the division of the payroll services, Clearwater shall perform or be responsible for performing the income reporting and withholding function under its own employer identification number for Clearwater Employees and its other
service providers, and Potlatch shall perform or be responsible for performing the income reporting and withholding function for Potlatch Employees and its other service providers. 

(c) Delivery of, and Access to, Documents and Other Information. Potlatch and Clearwater each shall make reasonably available to
the other Party all forms, documents or information, no matter in what format stored, relating to compensation or payments made to any employee or service provider to extent reasonably necessary to facilitate an individual’s transfer to, or
service or employment by, the other Party. Such information may include, but is not limited to, information concerning employee payroll deductions, payroll adjustments, records of time worked, tax records (e.g., Forms W-2, W-4, 940 and 941),
and information concerning garnishment of wages or other payments. 
 (d) Consistency of Payroll Taxes and Contributions.
Potlatch and Clearwater shall individually and collectively use commercially reasonable efforts to avoid unnecessarily duplicative federal, state or local payroll taxes, insurance or workers’ compensation contributions, or unemployment
contributions arising on or after the Distribution Date. Potlatch and Clearwater shall take consistent reporting and withholding positions with respect to any such taxes or contributions. 

10.6 Personnel and Pay Records. Subject to Section 12.1 of the Separation Agreement, for such period as Potlatch and
Clearwater may mutually agree in writing, Potlatch and Clearwater shall make reasonably available to the other Party (including the ability to duplicate) to the extent necessary to facilitate a transfer of employment or service to the other Party,
subject to applicable laws on confidentiality and data protection, all current and historic forms, documents or information, no matter in what format stored, relating to pre-Distribution Date personnel, medical records, and payroll information. Such
forms, documents or information may include, but is not limited to: (a) information regarding an Employee’s ranking or promotions; (b) the existence and nature of garnishment orders or other judicial or administrative actions or
orders affecting an employee’s or service provider’s compensation; and (c) performance evaluations. 
 10.7
Unemployment Insurance Program. 
 (a) Coverage Through Distribution Date. All current Potlatch Employees and all
current Clearwater Employees will be covered under the Clearwater Unemployment Insurance Program through the Distribution Date. Clearwater shall cooperate with the 

 

 35 

 
unemployment insurance vendor(s) by providing information in its possession that is necessary for the development of the Potlatch Unemployment Insurance Program. 

(b) Coverage Post-Distribution Date. Before the Distribution Date, the Parties shall use their commercially reasonable efforts to
enable Potlatch to procure an agreement with its unemployment insurance vendor(s) with the Material Features of the Clearwater Unemployment Insurance Program. After the Distribution Date, Potlatch and Clearwater will maintain their respective
Unemployment Insurance Programs for their respective employees. 
 (c) Tax Experience Rating. Unless otherwise directed
by Potlatch, the Parties shall use their commercially reasonable efforts to enable Potlatch as well as all members of the Potlatch Group, to retain the existing experience rating on or after the Distribution Date. 

10.8 Non-Termination of Employment. Neither the Distribution or Separation, nor the termination of the Participating Company
status of Potlatch, Clearwater or any member of the Potlatch Group or Clearwater Group shall cause any employee to be deemed to have incurred a termination of employment; and no transfer of employment between Potlatch and Clearwater before the
Distribution Date shall be deemed a termination of employment for any purpose hereunder. 
 10.9 Leave of Absence Programs
and FMLA. 
 (a) Allocation of Responsibilities After Distribution Date. Subject to Section 12.1 of the
Separation Agreement, effective as of the Distribution Date: (i) each Party shall adopt (or continue to maintain) Leave of Absence Programs which are substantially identical in all Material Features to the existing Leave of Absence Programs as
in effect on the Distribution Date; (ii) each Party shall honor all terms and conditions of leaves of absence which have been granted to any Clearwater or Potlatch Employee under an existing Leave of Absence Program or FMLA before the
Distribution Date, including such leaves that are to commence after the Distribution Date; (iii) each Party shall be solely responsible for administering leaves of absence and complying with FMLA with respect to its hourly Employees; and
(iv) each Party shall recognize all periods of service of the other Party’s employees to the extent such service is recognized under the existing Leave of Absence Programs and FMLA; provided, however, that no duplication of benefits shall,
to the extent permitted by law, be required by the foregoing. 
 (b) Disclosure. Subject to Section 12.1 of the
Separation Agreement, at such date as mutually agreed in writing by the Parties, Clearwater shall provide to Potlatch copies of all records pertaining to the Clearwater Leave of Absence Programs and FMLA with respect to all Potlatch Employees to the
extent such records have not been previously provided. 
 10.10 Employment Litigation. Subject to the Separation
Agreement, Potlatch shall have the sole responsibility for all employment-related claims regarding Potlatch Employees, and Clearwater shall have the sole responsibility for all employment-related claims regarding Clearwater Employees, that exist, or
come into existence, on or after the Distribution Date arising out of or relating to or resulting from their employment in the Retained Business or Pulp-Based Business, respectively. 
  

 36 

 10.11 Workers’ Compensation. The ownership and administration of workers
compensation insurance shall be governed by Article VIII of the Separation Agreement. 
  

 37 

 ARTICLE XI 
 LABOR AGREEMENTS 
 The Parties agree that the Labor Agreements and
the Liabilities thereunder shall, in each case, as applicable, be retained by, or, as applicable, assumed by, and assigned to, Clearwater. 
  

 38 

 ARTICLE XII 
 GENERAL PROVISIONS 
 12.1 Relationship of Parties. Nothing in
this Agreement shall be deemed or construed by the Parties or any third party as creating the relationship of principal and agent, partnership or joint venture between the Parties, the understanding and agreement being that no provision contained
herein, and no act of the Parties, shall be deemed to create any relationship between the Parties other than the relationship set forth herein. 
 12.2 Incorporation of Separation Agreement Provisions. The following provisions of the Separation Agreement are hereby incorporated herein by reference, and unless otherwise expressly specified
herein, such provisions shall apply as if fully set forth herein (references in this Section to an “Article” shall mean Articles of the Separation Agreement, and, except as expressly set forth below, references in the material incorporated
herein by reference shall be references to the Separation Agreement): Article IX (Expenses); Article X (Indemnification); Article XI (Dispute Resolution); and Article XII (Access to Information and Services). 

12.3 Conflict. In the event of any conflict between the provisions of this Agreement and the Separation Agreement, any other
Agreement between the Parties, or any Plan, then the provisions of this Agreement shall control. 
 12.4 Entire
Agreement. This Agreement, the Separation Agreement, the Transition Services Agreement, and the documents delivered pursuant hereto and thereto, constitute the entire agreement between the Parties with respect to the subject matter contained
herein or therein, and supersede all prior agreements, negotiations, discussions, understandings, writings and commitments between the Parties with respect to such subject matter. 

12.5 Choice of Law and Forum. This Agreement shall be governed by and construed and enforced in accordance with the substantive
laws of the State of Delaware and the federal laws of the United States of America applicable therein, as though all acts and omissions related hereto occurred in Delaware. 
 12.6 Amendment. This Agreement shall not be amended, modified or supplemented except by a written instrument signed by an authorized representative of each of the Parties. 

12.7 Waiver. Any term or provision of this Agreement may be waived, or the time for its performance may be extended, by the Party
or Parties entitled to the benefit thereof. Any such waiver shall be validly and sufficiently given for the purposes of this Agreement if, as to any Party, it is in writing signed by an authorized representative of such Party. The failure of any
Party to enforce at any time any provision of this Agreement shall not be construed to be a waiver of such provision, or in any way to affect the validity of this Agreement or any part hereof or the right of any Party thereafter to enforce each and
every such provision. No waiver of any breach of this Agreement shall be held to constitute a waiver of any other or subsequent breach. 
  

 39 

 12.8 Partial Invalidity. Wherever possible, each provision hereof shall be
interpreted in such a manner as to be effective and valid under applicable Law, but in case any one or more of the provisions contained herein shall, for any reason, be held to be invalid, illegal or unenforceable in any respect, such provision or
provisions shall be ineffective to the extent, but only to the extent, of such invalidity, illegality or unenforceability without invalidating the remainder of such provision or provisions or any other provisions hereof, unless such a construction
would be unreasonable. 
 12.9 Execution in Counterparts. This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original instrument, but all of which shall be considered one and the same agreement, and shall become binding when one or more counterparts have been signed by and delivered to each of the Parties. 

12.10 Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the Parties hereto and thereto,
respectively, and their successors and permitted assigns; provided, however, that the rights and obligations of either Party under this Agreement shall not be assignable by such Party without the prior written consent of the other Party. The
successors and permitted assigns hereunder shall include, without limitation, any permitted assignee as well as the successors in interest to such permitted assignee (whether by merger, liquidation (including successive mergers or liquidations) or
otherwise). 
 12.11 No Third Party Beneficiaries. The provisions of this Agreement are solely for the benefit of the
Parties and their respective Affiliates, successors and permitted assigns and shall not confer upon any third Person any remedy, claim, liability, reimbursement or other right in excess of those existing without reference to this Agreement. No
provision in this Agreement shall be construed to create any right, or accelerate entitlement, to any compensation or benefit whatsoever on the part of any Potlatch Employee, Clearwater Employee or other future, present or former employee of
Potlatch or Clearwater under any Potlatch Plan or Clearwater Plan or otherwise. Furthermore, no provision in this Agreement is intended to, or shall, modify or amend any Potlatch Plan or Clearwater Plan. The foregoing shall not prevent the Parties
entitled to enforce this Agreement from enforcing any provision in this Agreement, but no other Person shall be entitled to enforce any provision in this Agreement on the grounds that it is an amendment to any Potlatch Plan or Clearwater Plan,
unless the provision is explicitly designated as such in this Agreement, and the Person is otherwise entitled to enforce the terms of such Potlatch Plan or Clearwater Plan. If a party who is not entitled to enforce this Agreement brings a lawsuit or
other action to enforce any provision in this Agreement as an amendment to any Potlatch Plan or Clearwater Plan and such provision is construed by a Governmental Entity to constitute an amendment of such Plan despite not being explicitly designated
as such in this Agreement, that provision shall retroactively lapse, thereby precluding it from having an amendatory effect. 

12.12 Notices. All notices, requests, claims, demands and other communications required or permitted hereunder shall be in writing
and shall be deemed given or delivered (a) when delivered personally, (b) if transmitted by facsimile when confirmation of transmission is received, (c) if sent by registered or certified mail, postage prepaid, return receipt
requested, on the third business day after mailing, or (d) if sent by private courier when received; and shall be addressed as follows: 
  

 40 

 If to Potlatch, to: 
 Potlatch Corporation 
 601 W. First Avenue, Suite 1600 

Spokane, WA 99201 

Facsimile: (509) 835-1561 
 Attention: General Counsel 
 If to Clearwater, to: 

Clearwater Paper Corporation 
 601 West Riverside Avenue, Suite 1100 
 Spokane, WA 99201 

Facsimile: (509) 342-2570 
 Attention: General Counsel 
 or to such other address as such Party may indicate by a notice
delivered to the other Party. 
 12.13 Performance. Each Party shall cause to be performed, and hereby guarantees the
performance of, all actions, agreements and obligations set forth herein to be performed by any Subsidiary or Affiliate of such Party. 
 12.14 Force Majeure. No Party shall be deemed in default of this Agreement to the extent that any delay or failure in the performance of its obligations under this Agreement results from any cause
beyond its reasonable control and without its fault or negligence, including, without limitation, acts of God, acts of civil or military authority, embargoes, epidemics, war, riots, labor strikes, work stoppages as a result of labor unrest,
insurrections, fires, explosions, earthquakes, floods, unusually severe weather conditions, or unavailability of parts, or, in the case of computer systems, any failure in electrical or air conditioning equipment. In the event of any such excused
delay, the time for performance shall be extended for a period equal to the time lost by reason of the delay. 
 12.15 No
Public Announcement. Neither Potlatch nor Clearwater shall, without the approval of the other, make any press release or other public announcement concerning the actions (or inactions) contemplated by this Agreement, except as and to the extent
that any such Party shall be so obligated by Law or the rules of any stock exchange or quotation system, in which case the other Party shall be advised and the Parties shall use commercially reasonable efforts to cause a mutually agreeable release
or announcement to be issued; provided, however, that; the foregoing shall not preclude communications or disclosures necessary: (a) to implement the provisions of this Agreement; (b) to comply with the accounting and SEC disclosure
obligations or the rules of any stock exchange; (c) to comply with a Labor Agreement and any requisite effects bargaining; or (d) to promote a smooth transition for the employees, including FAQs and other employee communications.

 12.16 Termination. Notwithstanding any provisions hereof, this Agreement may be terminated and the Distribution
abandoned at any time prior to the Distribution Date by and in the sole discretion of the Board of Directors of Potlatch without the prior approval of any Person. 

 

 41 

 
In the event of such termination, this Agreement shall forthwith become void and no Party shall have any liability to any Person by reason of this Agreement. 

[signature page follows] 
  

 42 

  
 IN WITNESS
WHEREOF, each Party has caused this Agreement to be executed by its authorized representative as of the date first above written. 
  

			
	 POTLATCH CORPORATION,
 a Delaware corporation

		
	By:	 	/s/ Michael J. Covey
	Name: Michael J. Covey

  

			
	 CLEARWATER PAPER CORPORATION,

a Delaware corporation

		
	By:	 	/s/ Gordon L. Jones
	Name: Gordon L. Jones

  
 43 

 SCHEDULE 1.31 
 HEALTH AND WELFARE BENEFITS PLANS 
  

	
	Potlatch Forest Products Corporation Insured Health Benefits Plan
	
	Potlatch Forest Products Corporation Health & Welfare Plan
	
	HMO with Vision and Prescription Drug Benefits – Health Plan of Nevada

  

 I 

 SCHEDULE 1.35 
 LABOR AGREEMENTS 
  

							
	 Labor Agreement
	  	 Location
	  	Represented Group	  	Expiration Date
				
	Master Working Agreement between Potlatch Forest Products Corporation and Local Lodge W-364, Clearwater Unit, Lewiston, Idaho; and I.A.M.A.W. Woodworkers International Association
of Machinists and Aerospace Workers	  	Idaho	  	Hourly employees at
Lewiston Lumber Products	  	May 31, 2012
				
	Working Agreement between Potlatch Forest Products Corporation and #4 Power Boiler Unit, Lewiston, Idaho and Woodworkers District Lodge W1, International Association of Machinists
and Aerospace Workers, Local Lodge W-364	  	Idaho	  	Hourly employees at
Lewiston Pulp &
Paperboard Number 4
Power Boiler	  	May 31, 2012
				
	Agreement by and between Potlatch Corporation, McGhee, Arkansas and the United Steel Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers
International Union, its affiliated Local No. 13-1532 and its affiliated Local No. 13-1533	  	Arkansas	  	Hourly employees at
Arkansas Pulp &
Paperboard	  	July 31, 2009
				
	Agreement by and between Potlatch Forest Products Corporation, Lewiston, Idaho and Local Union No.73 of the International Brotherhood of Electrical Workers	  	Idaho	  	Hourly employees
(electricians) at Idaho Pulp
& Paperboard and
Consumer Products	  	August 31, 2010
				
	Agreement by and between Potlatch Forest Products Corporation and the United Steel, Paper and Forestry, Rubber Manufacturing, Energy, Allied Industrial and Service Workers
International Union and its affiliated Local Union 608 and its affiliated Local Union 712	  	Idaho	  	Hourly employees
(operations & maintenance)
at Idaho Pulp & Paperboard
and Consumer Products	  	August 31, 2010

  

 II 

 SCHEDULE 3.2(c)(i) 

ACTUARIAL ASSUMPTIONS 
 FOR DEFINED BENEFIT PLAN TERMINATION BASIS DETERMINATIONS 
  

			
	 Assumptions
	  	 Description

	 Interest Rates
 (new rates
published monthly)
	  	 As prescribed by 29 CFR 4044 Appendix B.
  

Applicable month’s rates will apply (September 2008 rates are 6.24% for years 1-20 and 5.31% for years thereafter).

		
	 Healthy Mortality
 (new
tables published annually)
	  	 As prescribed by 29 CFR 4044.53.
  

1994 GAM Basic mortality table (also known as US UP-94), projected by Scale AA to valuation year plus 10 years; sex distinct.

		
	Social Security Disabled Mortality	  	 As prescribed by 29 CFR 4044.53.
  

Table 5 and 6 in 29 CFR 4044 Appendix A.

		
	Non-Social Security Disabled Mortality	  	 As prescribed by 29 CFR 4044.53.
  

The lesser rates of the Healthy Mortality Table set forward three years or the Social Security Disabled Mortality Table.

		
	Expected Retirement Age (XRA) – when participant left employment less than one year before valuation date (or was still employed) and the facility where the participant
worked was closed less than one year before valuation date (or is in the process of being closed)	  	 As prescribed by 29 CFR 4044.57.
  

Earliest retirement age at valuation date.

		
	Expected Retirement Age (XRA) – participant does not fall in category above	  	 As prescribed by 29 CFR 4044.55 and 29 CFR 4044.56.
  

First – Determine which category (low, medium, high) participant is in depending on what year participant reaches unreduced retirement age (URA) and
the amount of unreduced benefit per the latest version of Table I (Table I-08 for 2008) located in CFR 4044 Appendix D.
  
 Second – Tables II-A, B, or C located in 29 CFR 4044 Appendix D are used for low, medium, and high categories, respectively, to determine XRA (cannot be earlier than age at valuation date). Must use
extended tables if any age is outside of table range.

		
	Benefit Form for participants not currently receiving benefits	  	 As prescribed by 29 CFR 4044.51(a).
  

Benefit payable in the absence of a valid election.

		
	Loading Expenses	  	 As prescribed by 29 CFR 4044 Appendix C.
  

$10,000, plus a percentage of the excess of the total value of liabilities over $200,000, plus $200 for each plan participant; the percentage is equal to
1%+[(P%-7.50%)/10], where P% is the interest rate for the first 20 years as prescribed by 29 CFR 4044 Appendix B, expressed as a percentage.

 

 III 

 SCHEDULE 6.7 
 DEFERRED PAYMENT CONTRACTS AND SEVERANCE CONTRACTS 
 All Liabilities with respect to, and
all responsibilities for administering, the deferred payment contracts and/or severance contracts for the following individuals shall be allocated between the Parties as indicated below. 

Allocated to Potlatch 
 Deferred Payment Contracts 
  

			
	 Grove
	  	Rehm
		
	 Robison
	  	Tate
	
	 Any other individual with a deferred payment contract not specifically allocated to Clearwater on this
Schedule

 Severance Contracts 

 

			
	 Akerman
	  	Bacon
		
	 Biazzo
	  	Black
		
	 Brenner
	  	Bullard
		
	 Cheek
	  	Clark
		
	 Davis
	  	Deward
		
	 Durand
	  	Hanby
		
	 Hawley
	  	Kosloski
		
	 Krantz
	  	Martin
		
	 McAdoo
	  	Nordholm
		
	 Norha
	  	Page
		
	 Palkie
	  	Powell
		
	 Robison
	  	Rosenbaum
		
	 Smrekar
	  	Warner
	
	 Any other individual with a severance contract not specifically allocated to Clearwater on this
Schedule

 Allocated to Clearwater 

Deferred Payment Contracts 
 None 
 Severance Contracts 

 

			
	 Beech
	  	Collier
		
	 DeBorde
	  	Fleshman
		
	 Morton
	  	Saarela

  

 IV 

 SCHEDULE 7.7(a) 

THIRD PARTY ASO CONTRACTS/PROFESSIONAL SERVICES 
  

							
	 Agreement Title
	  	Date	  	Party	  	Counter-Party
	 Direct Client Administrative Services Agreement
	  	7/1/05	  	Potlatch Forest
Products Corporation	  	CONEXIS Benefits
Administrators, LP
				
	 Professional Services Agreement
	  	1/1/03	  	Potlatch Forest
Products Corporation	  	Milliman, Inc.
				
	 Administrative Services Agreement
	  	1/1/06	  	Potlatch Forest
Products Corporation	  	Regence BlueShield of Idaho, Inc.
				
	 Administrative Services Agreement
	  	4/1/03	  	Potlatch Forest
Products Corporation	  	BlueAdvantage
 Administrators of Arkansas

				
	 Administrative Service Agreement
	  	7/1/08	  	Potlatch Forest
Products Corporation	  	Mercer HR Services
				
	 Professional Service Agreement
	  	1/1/08	  	Potlatch Forest
Products Corporation	  	AON

  

 V 

 SCHEDULE 7.7(b) 

GROUP INSURANCE POLICIES 
 Insured Health and Welfare Benefits 
  

			
		
	Basic Accidental Death & Dismemberment – Reliance Standard Insurance Company	 	Optional Accidental Death & Dismemberment – Reliance Standard Insurance Company
		
	Business Travel Accident – Hartford Insurance Company	 	Basic Life – Reliance Standard Insurance Company
		
	Optional Life – Reliance Standard Insurance Company	 	Dependents Life - Reliance Standard Insurance Company
		
	Group Universal Life Insurance – Metropolitan Life Insurance Company (Salaried employees over $100,000)	 	Long Term Disability – Reliance Standard Life Insurance Company (Salaried employees and (Elwood, IL, non-bargaining unit employees))
		
	Stop Loss Insurance – ING	 	

 Self-Insured Health and Welfare Benefits 

 

			
		
	Salaried Employees Medical PPO $300 Deductible – BlueAdvantage of Arkansas	 	Salaried Employees Medical PPO $600 Deductible – BlueAdvantage of Arkansas
		
	Hourly Represented PPO $300 Deductible (includes dental and vision) - Regence BlueShield of Idaho (Lewiston, ID USW/IBEW bargaining unit employees)	 	Hourly Represented PPO $600 Deductible (includes dental and vision) - Regence BlueShield of Idaho (Lewiston, ID USW/IBEW bargaining unit employees)
		
	Vision – VSP (Salaried employees and Elwood, IL, non-bargaining unit employees)	 	Salaried Dental – CIGNA
		
	Hourly Dental – CIGNA (Cypress Bend, AR USW bargaining unit employees)	 	Hourly Dental – CIGNA (Elwood, IL, non-bargaining unit employees)
		
	Short-term disability – Matrix (salaried employees)	 	Salaried and Hourly Prescription Drug – Express Scripts Incorporated (all employees and retirees)
		
	Hourly Retirees New $300 Deductible Plan – USW/IBEW – BlueAdvantage of Arkansas	 	Hourly Retirees New $600 Deductible Plan – USW/IBEW – BlueAdvantage of Arkansas
		
	Hourly Retirees $100 Deductible Plan – USW/IBEW – BlueAdvantage of Arkansas	 	Hourly Retirees $200 Deductible Plan – USW/IBEW – BlueAdvantage of Arkansas
		
	Hourly Retirees $300 Deductible Plan – USW/IBEW – BlueAdvantage of Arkansas	 	Hourly Retirees Base Major Medical Plan with $25 Deductible – USW/IBEW – BlueAdvantage of Arkansas
		
	Salaried Retirees Base Major Medical Plan with $50 Deductible – BlueAdvantage of Arkansas	 	Salaried Retirees $600 Deductible PPO Plan – BlueAdvantage of Arkansas
		
	Medicare Premium Reimbursement Program – USW/IBEW Lewiston, ID	 	

  

 VI 

 Other Health and Welfare Benefits 

 

	
	 Flexible Benefits Plan (includes before-tax premium, health care and dependent care) - Conexis

	
	The Nelson Trust: Medical PPO, Prescription Drugs, Dental, Vision, Life and Accidental Death and Dismemberment, Short-term Disability

 

 VII 

 SCHEDULE 8.3 
 FRINGE BENEFITS 
  

	
	Salaried Vacation Policy
	
	Service Award Program
	
	Tuition Refund Plan
	
	Relocation Policies (includes separate policies for New Hires and Existing Employees)

  

 VIII

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