Document:

First Amended and Restated Revolving Credit Agreement

  
 Exhibit 10.11 
  
 FIRST
AMENDED AND RESTATED 
 REVOLVING CREDIT AGREEMENT 
  
 dated as of September 30, 2003 
  
 among 
  
 DELTIC TIMBER CORPORATION, 
 as Borrower

  
 THE LENDERS FROM TIME TO TIME PARTY HERETO, 

 
 SUNTRUST BANK, 
 as Administrative Agent 
  
 and 
  
 BANK ONE, N.A., 
 as Syndication Agent 
  

  
 SUNTRUST ROBINSON HUMPHREY, 
 a Division of SunTrust Capital Markets, Inc.

 as Lead Arranger and Book Manager 
  

 30 

	TABLE OF CONTENTS

  

	 	 	 	  	Page

			
	 ARTICLE I
	 	 DEFINITIONS; CONSTRUCTION
	  	1
			
	 Section 1.1.
	 	Definitions	  	1
			
	 Section 1.2.
	 	Classifications of Loans and Borrowings	  	18
			
	 Section 1.3.
	 	Accounting Terms and Determination	  	18
			
	 Section 1.4.
	 	Terms Generally	  	18
			
	 ARTICLE II
	 	 AMOUNT AND TERMS OF THE COMMITMENTS
	  	19
			
	 Section 2.1.
	 	General Description of Facilities	  	19
			
	 Section 2.2.
	 	Revolving Loans	  	19
			
	 Section 2.3.
	 	Procedure for Revolving Borrowings	  	19
			
	 Section 2.4.
	 	Swingline Commitment	  	20
			
	 Section 2.5.
	 	Procedure for Swingline Borrowing; Etc	  	20
			
	 Section 2.6.
	 	Funding of Borrowings	  	21
			
	 Section 2.7.
	 	Interest Elections	  	22
			
	 Section 2.8.
	 	Optional Reduction and Termination of Commitments	  	23
			
	 Section 2.9.
	 	Repayment of Loans	  	23
			
	 Section 2.10.
	 	Evidence of Indebtedness	  	24
			
	 Section 2.11.
	 	Prepayments	  	24
			
	 Section 2.12.
	 	Interest on Loans	  	26
			
	 Section 2.13.
	 	Fees	  	26
			
	 Section 2.14.
	 	Computation of Interest and Fees	  	27
			
	 Section 2.15.
	 	Inability to Determine Interest Rates	  	27
			
	 Section 2.16.
	 	Illegality	  	28
			
	 Section 2.17.
	 	Increased Costs	  	28
			
	 Section 2.18.
	 	Funding Indemnity	  	29
			
	 Section 2.19.
	 	Taxes	  	30
			
	 Section 2.20.
	 	Payments Generally; Pro Rata Treatment; Sharing of Set-offs	  	31
			
	 Section 2.21.
	 	Mitigation of Obligations	  	33
			
	 Section 2.22.
	 	Replacement of Lenders	  	33

  

 -i- 

 TABLE OF CONTENTS 
  
 (continued) 
  

	 	 	 	  	Page

			
	 Section 2.23.
	 	Letters of Credit	  	34
			
	 ARTICLE III
	 	 CONDITIONS PRECEDENT TO LOANS AND LETTERS OF CREDIT
	  	38
			
	 Section 3.1.
	 	Conditions To Effectiveness	  	38
			
	 Section 3.2.
	 	Each Credit Event	  	40
			
	 Section 3.3.
	 	Delivery of Documents	  	40
			
	 ARTICLE IV
	 	 REPRESENTATIONS AND WARRANTIES
	  	41
			
	 Section 4.1.
	 	Existence; Power	  	41
			
	 Section 4.2.
	 	Organizational Power; Authorization	  	41
			
	 Section 4.3.
	 	Governmental Approvals; No Conflicts	  	41
			
	 Section 4.4.
	 	Financial Statements	  	41
			
	 Section 4.5.
	 	Litigation and Environmental Matters	  	42
			
	 Section 4.6.
	 	Compliance with Laws and Agreements	  	42
			
	 Section 4.7.
	 	Investment Company Act, Etc.	  	42
			
	 Section 4.8.
	 	Taxes	  	42
			
	 Section 4.9.
	 	Margin Regulations	  	42
			
	 Section 4.10.
	 	ERISA	  	43
			
	 Section 4.11.
	 	Ownership of Property	  	43
			
	 Section 4.12.
	 	Disclosure	  	43
			
	 Section 4.13.
	 	Labor Relations	  	43
			
	 Section 4.14.
	 	Subsidiaries	  	44
			
	 ARTICLE V
	 	 AFFIRMATIVE COVENANTS
	  	44
			
	 Section 5.1.
	 	Financial Statements and Other Information	  	44
			
	 Section 5.2.
	 	Notices of Material Events	  	45
			
	 Section 5.3.
	 	Existence; Conduct of Business	  	46
			
	 Section 5.5.
	 	Payment of Obligations	  	46
			
	 Section 5.6.
	 	Books and Records	  	46
			
	 Section 5.7.
	 	Visitation, Inspection, Appraisals Etc	  	46
			
	 Section 5.8.
	 	Maintenance of Properties; Insurance	  	47

  

 -ii- 

 TABLE OF CONTENTS 
  
 (continued) 
  

	 	 	 	  	Page

			
	 Section 5.9.
	 	Use of Proceeds and Letters of Credit	  	47
			
	 Section 5.10.
	 	Additional Subsidiaries	  	47
			
	 ARTICLE VI
	 	 FINANCIAL COVENANTS
	  	47
			
	 Section 6.1.
	 	Leverage Ratio	  	47
			
	 Section 6.2.
	 	Interest Coverage Ratio	  	48
			
	 Section 6.3.
	 	Fixed Charge Coverage Ratio	  	48
			
	 Section 6.4.
	 	Consolidated Net Worth	  	48
			
	 Section 6.5.
	 	Minimum Timber Market Value	  	48
			
	 ARTICLE VII
	 	 NEGATIVE COVENANTS
	  	48
			
	 Section 7.1.
	 	Indebtedness	  	48
			
	 Section 7.2.
	 	Negative Pledge	  	49
			
	 Section 7.3.
	 	Fundamental Changes	  	50
			
	 Section 7.4.
	 	Investments, Loans, Etc.	  	50
			
	 Section 7.5.
	 	Restricted Payments	  	51
			
	 Section 7.6.
	 	Sale of Assets	  	51
			
	 Section 7.7.
	 	Transactions with Affiliates	  	51
			
	 Section 7.8.
	 	Restrictive Agreements	  	52
			
	 Section 7.9.
	 	Sale and Leaseback Transactions	  	52
			
	 Section 7.10.
	 	Hedging Agreements	  	52
			
	 Section 7.11.
	 	Amendment to Material Documents	  	52
			
	 Section 7.12.
	 	Accounting Changes	  	53
			
	 ARTICLE VIII
	 	 EVENTS OF DEFAULT
	  	53
			
	 Section 8.1.
	 	Events of Default	  	53
			
	 ARTICLE IX
	 	THE ADMINISTRATIVE AGENT	  	55
			
	 Section 9.1.
	 	Appointment of Administrative Agent	  	55
			
	 Section 9.2.
	 	Nature of Duties of Administrative Agent	  	56
			
	 Section 9.3.
	 	Lack of Reliance on the Administrative Agent	  	56
			
	 Section 9.4.
	 	Certain Rights of the Administrative Agent	  	57

  

 -iii- 

 TABLE OF CONTENTS 
  
 (continued) 
  

	 	 	 	  	Page

			
	 Section 9.5.
	 	Reliance by Administrative Agent	  	57
			
	 Section 9.6.
	 	The Administrative Agent in its Individual Capacity	  	57
			
	 Section 9.7.
	 	Successor Administrative Agent	  	57
			
	 Section 9.8.
	 	Authorization to Execute other Loan Documents	  	58
			
	 Section 9.9.
	 	Syndication Agent	  	58
			
	 ARTICLE X
	 	 MISCELLANEOUS
	  	58
			
	 Section 10.1.
	 	Notices	  	58
			
	 Section 10.2.
	 	Waiver; Amendments	  	59
			
	 Section 10.3.
	 	Expenses; Indemnification	  	60
			
	 Section 10.4.
	 	Successors and Assigns	  	62
			
	 Section 10.5.
	 	Governing Law; Jurisdiction; Consent to Service of Process	  	64
			
	 Section 10.6.
	 	Waiver of Jury Trial	  	65
			
	 Section 10.7.
	 	Right of Setoff	  	65
			
	 Section 10.8.
	 	Counterparts; Integration	  	65
			
	 Section 10.9.
	 	Survival	  	66
			
	 Section 10.10.
	 	Severability	  	66
			
	 Section 10.11.
	 	Confidentiality	  	66
			
	 Section 10.12.
	 	Interest Rate Limitation	  	67
			
	 Section 10.13.
	 	Waiver of Effect of Corporate Seal	  	67

  

 -iv- 

	 Schedules
	  	 	  	 
			
	 Schedule I
	  	-	  	Applicable Margins and Applicable Commitment Fee Percentage
	 Schedule 4.14
	  	-	  	Subsidiaries
	 Schedule 7.1
	  	-	  	Outstanding Indebtedness
	 Schedule 7.2
	  	-	  	Existing Liens
	 Schedule 7.4
	  	-	  	Existing Investments
			
	 Exhibits
	  	-	  	 
			
	 Exhibit A
	  	-	  	Revolving Credit Note
	 Exhibit B
	  	-	  	Swingline Note
	 Exhibit C
	  	-	  	Form of Assignment and Acceptance
	 Exhibit D
	  	-	  	Form of Subsidiary Guaranty Agreement
	 Exhibit E
	  	-	  	Form of Indemnity, Subrogation and Contribution Agreement
			
	 Exhibit 2.3
	  	-	  	Notice of Revolving Borrowing
	 Exhibit 2.5
	  	-	  	Notice of Swingline Borrowing
	 Exhibit 2.9
	  	-	  	Form of Continuation/Conversion
	 Exhibit 3.1(b)(iv)
	  	-	  	Form of Secretary’s Certificate
	 Exhibit 3.1(b)(vii)
	  	-	  	Form of Officer’s Certificate

  

 FIRST AMENDED AND RESTATED 
 REVOLVING CREDIT AGREEMENT 
  
 THIS FIRST AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT (this “Agreement”) is made and entered into as of September 30, 2003, by and among DELTIC TIMBER CORPORATION, a Delaware corporation
(the “Borrower”), the several banks and other financial institutions from time to time party hereto (the “Lenders”), SUNTRUST BANK, in its capacity as Administrative Agent for the Lenders (the
“Administrative Agent”) and BANK ONE, N.A., as Syndication Agent, (the “Syndication Agent”). 
  
 W I T N E S S E T H: 
  
 WHEREAS, the Borrower, SunTrust Bank, as Administrative Agent, Bank One N.A., as Syndication Agent and the Lenders as defined therein (the
“Prior Lenders”) previously entered into that certain Revolving Credit Agreement dated June 20, 2001, as previously amended (the “Prior Facility”) which established a $105,000,000 revolving credit facility in favor of the
Borrower; 
  
 WHEREAS, subject to the terms and conditions
of this Agreement, the Borrower, the Administrative Agent, the Syndication Agent and the Lenders severally, to the extent of their respective Commitments as defined herein, are willing to amend and restate the Prior Facility as set forth herein.

  
 NOW, THEREFORE, in consideration of the premises and
the mutual covenants herein contained, the Borrower, the Lenders and the Administrative Agent agree that the Prior Facility is amended and restated (but this Agreement is not intended as a novation of the Indebtedness of the Prior Facility) in its
entirety as follows: 
  
 ARTICLE I 
  
 DEFINITIONS; CONSTRUCTION 
  
 Section 1.1. Definitions. In addition to the other terms
defined herein, the following terms used herein shall have the meanings herein specified (to be equally applicable to both the singular and plural forms of the terms defined): 
  
 “Adjusted LIBO Rate” shall mean, with respect to each Interest Period for a Eurodollar Borrowing,
the rate per annum obtained by dividing (i) LIBOR for such Interest Period by (ii) a percentage equal to 1.00 minus the Eurodollar Reserve Percentage. 
  
 “Administrative Agent” shall have the meaning assigned to such term in the opening paragraph hereof. 
  
 “Administrative Questionnaire” shall mean, with
respect to each Lender, an administrative questionnaire in the form prepared by the Administrative Agent and submitted to the Administrative Agent duly completed by such Lender. 
  

 “Affiliate” shall mean, as to any Person, any other Person that directly, or
indirectly through one or more intermediaries, Controls, is Controlled by, or is under common Control with, such Person. For purposes of this definition, the term “Control” shall mean the power, directly or indirectly, either
to (i) vote 5% or more of securities having ordinary voting power for the election of directors (or persons performing similar functions) of a Person or (ii) direct or cause the direction of the management and policies of a Person, whether through
the ability to exercise voting power, by contract or otherwise; the terms “Controlling”, “Controlled by”, and “under common Control with” have meanings correlative thereto.

  
 “Aggregate Revolving Commitment
Amount” shall mean the aggregate principal amount of the Aggregate Revolving Commitments from time to time. On the Closing Date, the Aggregate Revolving Commitment Amount equals $125,000,000. 
  
 “Aggregate Revolving Commitments” shall mean,
collectively, all Revolving Commitments of all Lenders at any time outstanding. 
  
 “Applicable Commitment Fee Percentage” shall mean, with respect to the commitment fee as of any date, the percentage per annum determined by reference to the applicable Total Debt to EBITDA
Ratio in effect on such date as set forth on Schedule I attached hereto; provided, that a change in the Applicable Commitment Fee Percentage resulting from a change in the Total Debt to EBITDA Ratio shall be effective on the second Business
Day after which the Borrower delivers the financial statements required by Section 5.1(a) or (b) and the compliance certificate required by Section 5.1 (c); provided, further, that if at any time the Borrower shall
have failed to deliver such financial statements and such certificate by the due date as set forth herein, the Applicable Commitment Fee Percentage shall be at Level V until such time as such financial statements and certificate are delivered, at
which time the Applicable Commitment Fee Percentage shall be determined as provided above. Notwithstanding the foregoing, the Applicable Commitment Fee Percentage for the commitment fee from the Closing Date until the financial statement and
compliance certificate for the fiscal quarter ending on September 30, 2003 are delivered shall be at Level V. 
  
 “Applicable Lending Office” shall mean, for each Lender and for each Type of Loan, the “Lending Office” of such Lender
(or an Affiliate of such Lender) designated for such Type of Loan in the Administrative Questionnaire submitted by such Lender or such other office of such Lender (or an Affiliate of such Lender) as such Lender may from time to time specify to the
Administrative Agent and the Borrower as the office by which its Loans of such Type are to be made and maintained. 
  
 “Applicable Margin” shall mean with respect to all Revolving Loans outstanding on any date, a percentage per annum determined by
reference to the applicable Total Debt to EBITDA Ratio in effect on such date as set forth on Schedule I attached hereto; provided, that a change in the Applicable Margin resulting from a change in the Total Debt to EBITDA Ratio shall be
effective on the second Business Day after which the Borrower delivers the financial statements required by Section 5.1(a) or (b) and the compliance certificate required by Section 5.1 (c); provided further, that
if at any time the Borrower shall have failed to deliver such financial statements and such certificate by the due date as set forth herein, the Applicable 

  

 2 

 
Margin shall be at Level V until such time as such financial statements and certificate are delivered, at which time the Applicable Margin shall be
determined as provided above. Notwithstanding the foregoing, the Applicable Margin from the Closing Date until the financial statement and compliance certificate for the fiscal quarter ending on September 30, 2003 are delivered shall be at Level V.

  
 “Approved Fund” means any Person
(other than a natural Person) that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its business and that is administered or managed by (a) a
Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender. 
  
 “Asset Like Kind Exchange” shall mean a like kind exchange of timber or real estate development assets of the Borrower or any of
its Subsidiaries made in accordance with Section 1031 and Section 1033 of the Code. 
  
 “Assignment and Acceptance” shall mean an assignment and acceptance entered into by a Lender and an assignee (with the consent of any party whose consent is required by Section 10.4(b))
and accepted by the Administrative Agent, in the form of Exhibit C attached hereto or any other form approved by the Administrative Agent. 
  
 “Availability Period” shall mean the period from the Closing Date to the Revolving Commitment Termination Date. 
  
 “Base Rate” shall mean the higher of (i) the per
annum rate which the Administrative Agent publicly announces from time to time to be its prime lending rate, as in effect from time to time, or (ii) the Federal Funds Rate, as in effect from time to time, plus one-half of one percent (0.50%).
The Administrative Agent’s prime lending rate is a reference rate and does not necessarily represent the lowest or best rate charged to customers. The Administrative Agent may make commercial loans or other loans at rates of interest at, above
or below the Administrative Agent’s prime lending rate. Each change in the Administrative Agent’s prime lending rate shall be effective from and including the date such change is publicly announced as being effective. 
  
 “Borrower” shall have the meaning in the introductory
paragraph hereof. 
  
 “Borrowing” shall
mean a borrowing consisting of (i) Loans of the same Class and Type, made, converted or continued on the same date and in case of Eurodollar Loans, as to which a single Interest Period is in effect, or (ii) a Swingline Loan. 
  
 “Business Day” shall mean (i) any day other than a
Saturday, Sunday or other day on which commercial banks in Atlanta, Georgia are authorized or required by law to close and (ii) if such day relates to a Borrowing of, a payment or prepayment of principal or interest on, a conversion of or into, or
an Interest Period for, a Eurodollar Loan or a notice with respect to any of the foregoing, any day on which dealings in Dollars are carried on in the London interbank market. 
  

 3 

 “Capital Lease Obligations” of any Person shall mean all obligations of such
Person to pay rent or other amounts under any lease (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases on a
balance sheet of such Person under GAAP, and the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP. 
  
 “Change in Control” shall mean the occurrence of one or more of the following events: (a) any sale, lease, exchange or other
transfer (in a single transaction or a series of related transactions) of all or substantially all of the assets of the Borrower to any Person or “group” (within the meaning of the Securities Exchange Act of 1934 and the rules of the
Securities and Exchange Commission thereunder in effect on the date hereof), (b) the acquisition of ownership, directly or indirectly, beneficially or of record, by any Person or “group” (within the meaning of the Securities Exchange Act
of 1934 and the rules of the Securities and Exchange Commission thereunder as in effect on the date hereof) other than the Murphy Family of 30% or more of the outstanding shares of the voting stock of the Borrower; or (c) occupation of a majority of
the seats (other than vacant seats) on the board of directors of the Borrower by Persons who were neither (i) nominated by the current board of directors or (ii) appointed by directors so nominated. 
  
 “Change in Law” shall mean (i) the adoption of any
applicable law, rule or regulation after the date of this Agreement, (ii) any change in any applicable law, rule or regulation, or any change in the interpretation or application thereof, by any Governmental Authority after the date of this
Agreement, or (iii) compliance by any Lender (or its Applicable Lending Office) or the Issuing Bank (or for purposes of Section 2.17(b), by such Lender’s or Issuing Bank’s holding company, if applicable) with any request, guideline
or directive (whether or not having the force of law) of any Governmental Authority made or issued after the date of this Agreement. 
  
 “Class”, when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are
Revolving Loans or Swingline Loans or and when used in reference to any Commitment, refers to whether such Commitment is a Revolving Commitment or a Swingline Commitment. 
  
 “Closing Date” shall mean September 30, 2003. 
  
 “Code” shall mean the Internal Revenue Code of 1986,
as amended and in effect from time to time. 
  
 “Commitment” shall mean a Revolving Commitment or a Swingline Commitment or any combination thereof (as the context shall permit or require). 
  
 “Consolidated EBITDA” shall mean, for the Borrower and its Subsidiaries for any period, an amount
equal to the sum of (a) Consolidated Net Income for such period plus (b) to the extent deducted in determining Consolidated Net Income for such period, (i) Consolidated Interest Expense, (ii) income tax expense determined on a consolidated
basis in accordance with GAAP, (iii) depreciation and amortization determined on a consolidated basis in accordance with 

  

 4 

 
GAAP, and (iv) all other non-cash charges determined on a consolidated basis in accordance with GAAP (other than write-down or write-off of any accounts or
inventory unless related to an extraordinary item), in each case for such period. 
  
 “Consolidated Fixed Charges” shall mean, for the Borrower and its Subsidiaries for any period, the sum (without duplication) of (a) Consolidated Interest Expense for such period and (b)
scheduled principal payments made on Consolidated Total Debt during such period. 
  
 “Consolidated Interest Expense” shall mean, for the Borrower and its Subsidiaries for any period determined on a consolidated basis in accordance with GAAP, the sum of (i) total interest
expense, including without limitation the interest component of any payments in respect of Capital Leases Obligations capitalized or expensed during such period (whether or not actually paid during such period) plus (ii) the net amount
payable (or minus the net amount receivable) under Hedging Agreements during such period (whether or not actually paid or received during such period). 
  

“Consolidated Net Income” shall mean, for the Borrower and its Subsidiaries for any period, the net income (or loss) of the
Borrower and its Subsidiaries for such period determined on a consolidated basis in accordance with GAAP, but excluding therefrom (to the extent otherwise included therein) (i) any extraordinary gains or losses, (ii) any gains attributable to
write-ups of assets, (iii) any equity interest of the Borrower or any Subsidiary of the Borrower in the unremitted earnings of any Person that is not a Subsidiary and (iv) any income (or loss) of any Person accrued prior to the date it becomes a
Subsidiary or is merged into or consolidated with the Borrower or any Subsidiary on the date that such Person’s assets are acquired by the Borrower or any Subsidiary. 
  
 “Consolidated Net Worth” shall mean, as of any date, (i) the total assets of the Borrower and its
Subsidiaries that would be reflected on the Borrower’s consolidated balance sheet as of such date prepared in accordance with GAAP, after eliminating all amounts properly attributable to minority interests, if any, in the stock and surplus of
Subsidiaries, minus (ii) the total liabilities of the Borrower and its Subsidiaries that would be reflected on the Borrower’s consolidated balance sheet as of such date prepared in accordance with GAAP. 
  
 “Consolidated Total Capital” shall mean, as of any
date, the sum of (i) Consolidated Total Debt as of such date and (ii) Consolidated Net Worth as of such date. 
  
 “Consolidated Total Debt” shall mean, as of any date, all Indebtedness of the Borrower and its Subsidiaries described in the
definition of “Indebtedness” (other than Indebtedness described in clause (xi) of such definition), including, without limitation, the Loans. 
  
 “Default” shall mean any condition or event that, with the giving of notice or the lapse of time or both, would constitute an
Event of Default. 
  
 “Default Interest”
shall have the meaning set forth in Section 2.12(c). 
  

 5 

 “Del-Tin” shall mean Del-Tin Fiber, LLC, an Arkansas limited liability company.

  
 “Del-Tin Agreements” shall mean,
collectively, (i) Del-Tin Fiber L.L.C. Operating Agreement, and (ii) the Del-Tin Fiber Contingent Equity Agreement. 
  
 “Del-Tin Fiber Contingent Equity Agreement” shall mean that certain Contingent Equity Contribution Agreement, dated as of November
23, 1998, by and among the Borrower, Del-Tin and Bank One, N.A., as agent. 
  
 “Dollar(s)” and the sign “$” shall mean lawful money of the United States of America. 
  
 “Eligible Assignee” means (a) a Lender; (b) an Affiliate of a Lender; (c) an Approved Fund; and (d)
any other Person (other than a natural Person) approved by the Administrative Agent, in the case of any assignment of any Revolving Credit Exposure, and Swingline Lender, and, unless (x) such Person is taking delivery of an assignment in connection
with physical settlement of a credit derivatives transaction or (y) an Event of Default has occurred and is continuing, the Borrower (each such approval not to be unreasonably withheld or delayed). If the consent of the Borrower to an assignment or
to an Eligible Assignee is required pursuant to this definition or under Section 10.4 (including a consent to an assignment which does not meet the minimum assignment thresholds specified in paragraph (b)(i) of Section 10.4), the
Borrower shall be deemed to have given its consent five Business Days after the date notice thereof has been delivered by the assigning Lender (through the Administrative Agent) unless such consent is expressly refused by the Borrower prior to such
fifth Business Day. 
  
 “Environmental
Laws” shall mean all laws, rules, regulations, codes, ordinances, orders, decrees, judgments, injunctions, notices or binding agreements issued, promulgated or entered into by or with any Governmental Authority, relating in any way to
the environment, preservation or reclamation of natural resources, the management, Release or threatened Release of any Hazardous Material or to health and safety matters. 
  
 “Environmental Liability” shall mean any liability, contingent or otherwise (including any liability
for damages, costs of environmental investigation and remediation, costs of administrative oversight, fines, natural resource damages, penalties or indemnities), of the Borrower or any Subsidiary directly or indirectly resulting from or based upon
(a) any actual or alleged violation of any Environmental Law, (b) the generation, use, handling, transportation, storage, treatment or disposal of any Hazardous Materials, (c) any actual or alleged exposure to any Hazardous Materials, (d) the
Release or threatened Release of any Hazardous Materials or (e) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing. 
  
 “ERISA” shall mean the Employee Retirement Income
Security Act of 1974, as amended from time to time, and any successor statute. 
  
 “ERISA Affiliate” shall mean any trade or business (whether or not incorporated), which, together with the Borrower, is treated as a single employer under Section 

  

 6 

 
414(b) or (c) of the Code or, solely for the purposes of Section 302 of ERISA and Section 412 of the Code, is treated as a single employer under Section 414
of the Code. 
  
 “ERISA Event”
shall mean (a) any “reportable event”, as defined in Section 4043 of ERISA or the regulations issued thereunder with respect to a Plan (other than an event for which the 30-day notice period is waived); (b) the existence with
respect to any Plan of an “accumulated funding deficiency” (as defined in Section 412 of the Code or Section 302 of ERISA), whether or not waived; (c) the filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an
application for a waiver of the minimum funding standard with respect to any Plan; (d) the incurrence by the Borrower or any of its ERISA Affiliates of any liability under Title IV of ERISA with respect to the termination of any Plan; (e) the
receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan administrator appointed by the PBGC of any notice relating to an intention to terminate any Plan or Plans or to appoint a trustee to administer any Plan; (f) the incurrence by
the Borrower or any of its ERISA Affiliates of any liability with respect to the withdrawal or partial withdrawal from any Plan or Multiemployer Plan; or (g) the receipt by the Borrower or any ERISA Affiliate of any notice, or the receipt by any
Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice, concerning the imposition of Withdrawal Liability or a determination that a Multiemployer Plan is, or is expected to be, insolvent or in reorganization, within the meaning of
Title IV of ERISA. 
  
 “Eurodollar” when
used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, bears interest at a rate determined by reference to the Adjusted LIBO Rate. 
  
 “Eurodollar Reserve Percentage” shall mean the
aggregate of the maximum reserve percentages (including, without limitation, any emergency, supplemental, special or other marginal reserves) expressed as a decimal (rounded upwards to the next 1/100th of 1%) in effect on any day to which the Administrative Agent is subject with respect to the Adjusted LIBO Rate pursuant to regulations issued by the Board of
Governors of the Federal Reserve System (or any Governmental Authority succeeding to any of its principal functions) with respect to eurocurrency funding (currently referred to as “eurocurrency liabilities” under Regulation D). Eurodollar
Loans shall be deemed to constitute eurocurrency funding and to be subject to such reserve requirements without benefit of or credit for proration, exemptions or offsets that may be available from time to time to any Lender under Regulation D. The
Eurodollar Reserve Percentage shall be adjusted automatically on and as of the effective date of any change in any reserve percentage. 
  
 “Event of Default” shall have the meaning provided in Article VIII. 
  
 “Excluded Taxes” shall mean with respect to the Administrative Agent, any Lender, the Issuing Bank
or any other recipient of any payment to be made by or on account of any obligation of the Borrower hereunder, (a) income or franchise taxes imposed on (or measured by) its net income by the United States of America, or by the jurisdiction 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 of America or any
similar tax imposed by any other jurisdiction in 

  

 7 

 
which any Lender is located and (c) in the case of a Foreign Lender, any withholding tax that (i) is imposed on amounts payable to such Foreign Lender at the
time such Foreign Lender becomes a party to this Agreement, (ii) is imposed on amounts payable to such Foreign Lender at any time that such Foreign Lender designates a new lending office, other than taxes that have accrued prior to the designation
of such lending office that are otherwise not Excluded Taxes, and (iii) is attributable to such Foreign Lender’s failure to comply with Section 2.19(e). 
  
 “Federal Funds Rate” shall mean, for any day, the rate per annum (rounded upwards, if necessary, to
the next 1/100th of 1%) equal to the weighted average of the rates on overnight Federal funds transactions with
member banks of the Federal Reserve System arranged by Federal funds brokers, as published by the Federal Reserve Bank of New York on the next succeeding Business Day or if such rate is not so published for any Business Day, the Federal Funds Rate
for such day shall be the average rounded upwards, if necessary, to the next 1/100th of 1% of the quotations for such day on such transactions received by the Administrative Agent from three Federal funds brokers of recognized standing selected by
the Administrative Agent. 
  
 “Fixed Charge Coverage
Ratio” shall mean, for any period of four consecutive fiscal quarters of the Borrower, the ratio of (a) Consolidated EBITDA for such period less the actual amount paid by the Borrower and its Subsidiaries in cash during such
period on account of (i) all dividends and distributions paid with respect to shares of capital stock of the Borrower and (ii) income tax expense to (b) Consolidated Fixed Charges for such period. 
  
 “Foreign Lender” shall mean any Lender that is not a
United States person under Section 7701(a)(3) of the Code. 
  
 “GAAP” shall mean generally accepted accounting principles in the United States applied on a consistent basis and subject to the terms of Section 1.3. 
  
 “Governmental Authority” shall mean the government of
the United States of America, any other nation or any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative,
judicial, taxing, regulatory or administrative powers or functions of or pertaining to government. 
  
 “Guarantee” of or by any Person (the “guarantor”) shall mean any obligation, contingent or otherwise, of
the guarantor guaranteeing or having the economic effect of guaranteeing any Indebtedness or other obligation of any other Person (the “primary obligor”) in any manner, whether directly or indirectly and including any
obligation, direct or indirect, of the guarantor (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation or to purchase (or to advance or supply funds for the purchase of) any security
for the payment thereof, (b) to purchase or lease property, securities or services for the purpose of assuring the owner of such Indebtedness or other obligation of the payment thereof, (c) to maintain working capital, equity capital or any other
financial statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other obligation or (d) as an account party in respect of any letter of credit or letter of guaranty issued in support
of such Indebtedness or obligation; provided, that the term 

  

 8 

 
“Guarantee” shall not include endorsements for collection or deposits in the ordinary course of business. The amount of any Guarantee shall be
deemed to be an amount equal to the stated or determinable amount of the primary obligation in respect of which Guarantee is made or, if not so stated or determinable, the maximum reasonably anticipated liability in respect thereof (assuming such
Person is required to perform thereunder) as determined by such Person in good faith. The term “Guarantee” used as a verb has a corresponding meaning. 
  

“Hazardous Materials” means all explosive or radioactive substances or wastes and all hazardous or toxic substances,
wastes or other pollutants, including petroleum or petroleum distillates, asbestos or asbestos containing materials, polychlorinated biphenyls, radon gas, infectious or medical wastes and all other substances or wastes of any nature regulated
pursuant to any Environmental Law. 
  
 “Hedging
Agreements” shall mean interest rate swap, cap or collar agreements, interest rate future or option contracts, currency swap agreements, currency future or option contracts, commodity agreements and other similar agreements or
arrangements designed to protect against fluctuations in interest rates, currency values or commodity values, in each case to which any Borrower or any Subsidiary is a party. 
  
 “Indebtedness” of any Person shall mean, without duplication (i) all obligations of such Person for
borrowed money, (ii) all obligations of such Person evidenced by bonds, debentures, notes or other similar instruments, (iii) all obligations of such Person in respect of the deferred purchase price of property or services (other than trade payables
incurred in the ordinary course of business; provided, that for purposes of Section 8.1(f), trade payables overdue by more than 120 days shall be included in this definition except to the extent that any of such trade payables are
being disputed in good faith and by appropriate measures), (iv) all obligations of such Person under any conditional sale or other title retention agreement(s) relating to property acquired by such Person, (v) all Capital Lease Obligations of such
Person, (vi) all obligations, contingent or otherwise, of such Person in respect of letters of credit, acceptances or similar extensions of credit, (vii) all Guarantees of such Person of the type of Indebtedness described in clauses (i) through (v)
above, (viii) all Indebtedness of a third party secured by any Lien on property owned by such Person, whether or not such Indebtedness has been assumed by such Person, (ix) all obligations of such Person, contingent or otherwise, to purchase,
redeem, retire or otherwise acquire for value any common stock of such Person, (x) Off-Balance Sheet Liabilities, and (xi) all obligations of such Person under Hedging Agreements. The Indebtedness of any Person shall include (i) the Indebtedness of
any partnership or joint venture in which such Person is a general partner or a joint venturer, except to the extent that the terms of such Indebtedness provide that such Person is not liable therefor and (ii) any contingent obligations of such
Person owing pursuant to the Del-Tin Fiber Contingent Equity Agreement. 
  
 “Indemnified Taxes” shall mean Taxes other than Excluded Taxes. 
  
 “Indemnity and Contribution Agreement” shall mean the First Amended and Restated Indemnity, Subrogation and Contribution
Agreement, substantially in the form of Exhibit E, among the Borrower, the Subsidiary Loan Parties and the Administrative Agent, as amended, restated, supplemented or otherwise modified from time to time. 
  

 9 

 “Interest Coverage Ratio” shall mean, as of any date, the ratio of (i)
Consolidated EBITDA for the four consecutive fiscal quarters ending on or immediately prior to such date to (ii) Consolidated Interest Expense for the four consecutive fiscal quarters ending on or immediately prior to such date. 
  
 “Interest Period” shall mean with respect to any
Eurodollar Borrowing, a period of one, two, three or six months; provided, that: 
  
 (i) the initial Interest Period for such Borrowing shall commence on the date of such Borrowing (including the date of any conversion from
a Borrowing of another Type), and each Interest Period occurring thereafter in respect of such Borrowing shall commence on the day on which the next preceding Interest Period expires; 
  
 (ii) if any Interest Period would otherwise end on a day other than a Business Day, such Interest Period
shall be extended to the next succeeding Business Day, unless such Business Day falls in another calendar month, in which case such Interest Period would end on the next preceding Business Day; 
  
 (iii) any Interest Period which begins on the last Business
Day of a calendar month or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period shall end on the last Business Day of such calendar month; and 
  
 (iv) no Interest Period may extend beyond the Revolving
Commitment Termination Date. 
  
 “Issuing
Bank” shall mean SunTrust Bank in its capacity as an issuer of Letters of Credit pursuant to Section 2.23. 
  
 “LC Commitment” shall mean that portion of the Aggregate Revolving Commitments that may be used by the Borrower for the issuance
of Letters of Credit in an aggregate face amount not to exceed $50,000,000. 
  
 “LC Disbursement” shall mean a payment made by the Issuing Bank pursuant to a Letter of Credit. 
  
 “LC Documents” shall mean the Letters of Credit and all applications, agreements and instruments relating to the Letters of
Credit. 
  
 “LC Exposure” shall mean, at
any time, the sum of (i) the aggregate undrawn amount of all outstanding Letters of Credit at such time, plus (ii) the aggregate amount of all LC Disbursements that have not been reimbursed by or on behalf of the Borrower at such time. The LC
Exposure of any Lender shall be its Pro Rata Share of the total LC Exposure at such time. 
  
 “Lenders” shall have the meaning assigned to such term in the opening paragraph of this Agreement and shall include, where appropriate, the Swingline Lender. 
  

 10 

 “Letter of Credit” shall mean any Letter of Credit issued pursuant to Section
2.23 by the Issuing Bank for the account of the Borrower pursuant to the LC Commitment. 
  
 “Leverage Ratio” shall mean, as of any date of determination with respect to the Borrower, the ratio of (i) Consolidated Total Debt as of such date to (ii) Consolidated Total Capital.

  
 “LIBOR” shall mean, for any applicable
Interest Period with respect to any Eurodollar Loan, the rate per annum for deposits in Dollars for a period equal to such Interest Period appearing on the display designated as Page 3750 on the Dow Jones Markets Service (or such other page on that
service or such other service designated by the British Banker’s Association for the display of such Association’s Interest Settlement Rates for Dollar deposits) as of 11:00 a.m. (London, England time) on the day that is two Business Days
prior to the first day of the Interest Period or if such Page 3750 is unavailable for any reason at such time, the rate which appears on the Reuters Screen ISDA Page as of such date and such time; provided, that if the Administrative Agent
determines that the relevant foregoing sources are unavailable for the relevant Interest Period, LIBOR shall mean the rate of interest determined by the Administrative Agent to be the average (rounded upward, if necessary, to the nearest
1/100th of 1%) of the rates per annum at which deposits in Dollars are offered to the Administrative Agent two (2)
Business Days preceding the first day of such Interest Period by leading banks in the London interbank market as of 10:00 a.m. for delivery on the first day of such Interest Period, for the number of days comprised therein and in an amount
comparable to the amount of the Eurodollar Loan of the Administrative Agent. 
  
 “Lien” shall mean any mortgage, pledge, security interest, lien (statutory or otherwise), charge, encumbrance, hypothecation, assignment, deposit arrangement, or other arrangement having the
practical effect of the foregoing or any preference, priority or other security agreement or preferential arrangement of any kind or nature whatsoever (including any conditional sale or other title retention agreement and any capital lease having
the same economic effect as any of the foregoing). 
  
 “Loan Documents” shall mean, collectively, this Agreement, the Notes, the LC Documents, the Subsidiary Guarantee Agreement, the Indemnity and Contribution Agreement, all Notices of Borrowing, all Notices of
Conversion/Continuation and any and all other instruments, agreements, documents and writings executed in connection with any of the foregoing. 
  
 “Loan Parties” shall mean the Borrower and the Subsidiary Loan Parties. 
  
 “Loans” shall mean all Revolving Loans and Swingline
Loans in the aggregate or any of them, as the context shall require. 
  
 “Material Adverse Effect” shall mean, with respect to any event, act, condition or occurrence of whatever nature (including any adverse determination in any litigation, arbitration, or governmental investigation or
proceeding), whether singularly or in conjunction with any other event or events, act or acts, condition or conditions, occurrence or occurrences whether or not related, a material adverse change in, or a material adverse effect on, (i) the
business, results 
  

 11 

 
of operations, financial condition, assets, liabilities or prospects of the Borrower or of the Borrower and its Subsidiaries taken as a whole, (ii) the
ability of the Loan Parties to perform any of their respective obligations under the Loan Documents, (iii) the rights and remedies of the Administrative Agent, the Issuing Bank and the Lenders under any of the Loan Documents or (iv) the legality,
validity or enforceability of any of the Loan Documents. 
  
 “Material Indebtedness” shall mean Indebtedness (other than the Loans and the Letters of Credit) or obligations in respect of one or more Hedging Agreements, of any one or more of the Borrower and the Subsidiaries in
an aggregate principal amount exceeding $500,000. For purposes of determining Material Indebtedness, the “principal amount” of the obligations of the Borrower or any Subsidiary in respect to any Hedging Agreement at any time shall be the
maximum aggregate amount (giving effect to any netting agreements) that the Borrower or such Subsidiary would be required to pay if such Hedging Agreement were terminated at such time. 
  
 “Moody’s” shall mean Moody’s Investors Service, Inc. 
  
 “Multiemployer Plan” shall have the meaning set forth
in Section 4001(a)(3) of ERISA. 
  
 “Murphy
Family” shall mean, collectively, estates and descendants of C.H. Murphy, Jr., his sisters, any of their spouses or descendants or persons married to their descendants and any investment entity that is controlled by any of the
foregoing. 
  
 “Note Purchase Agreement”
shall mean that certain Note Purchase Agreement, dated as of December 18, 1998, by and among the Borrower and Pacific Coast Farm Credit Services, ACA, predecessor-in-interest to American Agcredit, PCA, relating to $40,000,000 6.66% Senior Notes due
December 18, 2008, as the same may be amended or otherwise modified and in effect from time to time. 
  
 “Notes” shall mean, collectively, the Revolving Credit Notes and the Swingline Note. 
  
 “Notices of Borrowing” shall mean, collectively, the
Notices of Revolving Borrowing and the Notices of Swingline Borrowing. 
  
 “Notice of Conversion/Continuation” shall mean the notice given by the Borrower to the Administrative Agent in respect of the conversion or continuation of an outstanding Borrowing as provided in Section
2.7(b) hereof. 
  
 “Notice of Revolving
Borrowing” shall have the meaning as set forth in Section 2.3. 
  
 “Notice of Swingline Borrowing” shall have the meaning as set forth in Section 2.5. 
  
 “Obligations” shall mean all amounts owing by the Borrower to the Administrative Agent, the Issuing Bank or any Lender (including
the Swingline Lender) 
  

 12 

 
pursuant to or in connection with this Agreement or any other Loan Document, including without limitation, all principal, interest (including any interest
accruing after the filing of any petition in bankruptcy or the commencement of any insolvency, reorganization or like proceeding relating to the Borrower, whether or not a claim for post-filing or post-petition interest is allowed in such
proceeding), all reimbursement obligations, fees, expenses, indemnification and reimbursement payments, costs and expenses (including all fees and expenses of counsel to the Administrative Agent and any Lender (including the Swingline Lender)
incurred pursuant to this Agreement or any other Loan Document), whether direct or indirect, absolute or contingent, liquidated or unliquidated, now existing or hereafter arising hereunder or thereunder, and all obligations arising under Hedging
Agreements relating to the foregoing to the extent permitted hereunder, and all obligations and liabilities incurred in connection with collecting and enforcing the foregoing, together with all renewals, extensions, modifications or refinancings
thereof. 
  
 “Off-Balance Sheet
Liabilities” of any Person shall mean (i) any repurchase obligation or liability of such Person with respect to accounts or notes receivable sold by such Person, (ii) any liability of such Person under any sale and leaseback
transactions which do not create a liability on the balance sheet of such Person, (iii) any liability of such Person under any so-called “synthetic” lease transaction or (iv) any obligation arising with respect to any other transaction
which is the functional equivalent of or takes the place of borrowing but which does not constitute a liability on the balance sheet of such Person. 
  
 “Other Taxes” shall mean any and all present or future stamp or documentary taxes or any other excise or property taxes, charges
or similar levies arising from any payment made hereunder or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement or any other Loan Document. 
  
 “Participant” shall have the meaning set forth in Section 10.4(d). 
  
 “Payment Office” shall mean the office of the
Administrative Agent located at 303 Peachtree Street, N.E., Atlanta, Georgia 30308, or such other location as to which the Administrative Agent shall have given written notice to the Borrower and the other Lenders. 
  
 “PBGC” shall mean the Pension Benefit Guaranty
Corporation referred to and defined in ERISA, and any successor entity performing similar functions. 
  
 “Permitted Encumbrances” shall mean 
  
 (i) Liens imposed by law for taxes or special assessments not yet due or which are being contested in good faith by appropriate
proceedings and with respect to which adequate reserves are being maintained in accordance with GAAP; 
  
 (ii) statutory Liens of landlords and Liens of carriers, warehousemen, mechanics, materialmen and other Liens imposed by law created in
the ordinary course of business for amounts not yet due or which are being contested in good faith by appropriate proceedings and with respect to which adequate reserves are being maintained in accordance with GAAP; 
  

 13 

 (iii) pledges and deposits made in the ordinary course of business in compliance with
workers’ compensation, unemployment insurance and other social security laws or regulations; 
  
 (iv) deposits to secure the performance of bids, trade contracts, leases, statutory obligations, surety and appeal bonds, performance
bonds and other obligations of a like nature, in each case in the ordinary course of business; 
  
 (v) judgment and attachment liens not giving rise to an Event of Default or Liens created by or existing from any litigation or legal
proceeding that are currently being contested in good faith by appropriate proceedings and with respect to which adequate reserves are being maintained in accordance with GAAP; and 
  
 (vi) easements, zoning restrictions, rights-of-way and similar encumbrances on real property imposed by law
or arising in the ordinary course of business that do not secure any monetary obligations and do not materially detract from the value of the affected property or materially interfere with the ordinary conduct of business of the Borrower and its
Subsidiaries taken as a whole;  
  
 provided, that the term
“Permitted Encumbrances” shall not include any Lien securing Indebtedness. 
  
 “Permitted Investments” shall mean: 
  
 (i) direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States (or
by any agency thereof to the extent such obligations are backed by the full faith and credit of the United States), in each case maturing within one year from the date of acquisition thereof; 
  
 (ii) commercial paper having the highest rating, at the time
of acquisition thereof, of S&P or Moody’s and in either case maturing within six months from the date of acquisition thereof; 
  
 (iii) certificates of deposit, bankers’ acceptances and time deposits maturing within 180 days of the date of acquisition thereof
issued or guaranteed by or placed with, and money market deposit accounts issued or offered by, any domestic office of any commercial bank organized under the laws of the United States or any state thereof which has a combined capital and surplus
and undivided profits of not less than $500,000,000; 
  
 (iv) fully collateralized repurchase agreements with a term of not more than 30 days for securities described in clause (i) above and entered into with a financial institution satisfying the criteria described in clause (iii) above; and

  
 (v) mutual funds investing solely in any one
or more of the Permitted Investments described in clauses (i) through (iv) above. 
  

 14 

 “Person” shall mean any individual, partnership, firm, corporation, association,
joint venture, limited liability company, trust or other entity, or any Governmental Authority. 
  
 “Plan” means any employee pension benefit plan (other than a Multiemployer Plan) subject to the provisions of Title IV of ERISA or
Section 412 of the Code or Section 302 of ERISA, and in respect of which the Borrower or any ERISA Affiliate is (or, if such plan were terminated, would under Section 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5)
of ERISA. 
  
 “Pro Rata Share” shall mean
with respect to any Revolving Commitment of any Lender at any time, a percentage, the numerator of which shall be such Lender’s Revolving Commitment (or if such Revolving Commitments have been terminated or expired or the Loans have been
declared to be due and payable, such Lender’s Loan funded under such Revolving Commitment), and the denominator of which shall be the sum of such Revolving Commitments of all Lenders (or if such Revolving Commitments have been terminated or
expired or the Loans have been declared to be due and payable, all Loans of all Lenders funded under such Revolving Commitments). 
  
 “Regulation D” shall mean Regulation D of the Board of Governors of the Federal Reserve System, as the same may be in effect from
time to time, and any successor regulations. 
  
 “Related Parties” shall mean, with respect to any specified Person, such Person’s Affiliates and the respective directors, officers, employees, agents and advisors of such Person and such Person’s
Affiliates. 
  
 “Release” means any
release, spill, emission, leaking, dumping, injection, pouring, deposit, disposal, discharge, dispersal, leaching or migration into the environment (including ambient air, surface water, groundwater, land surface or subsurface strata) or within any
building, structure, facility or fixture. 
  
 “Required
Lenders” shall mean, at any time, Lenders holding more than 50% of the aggregate outstanding Revolving Commitments at such time or if the Lenders have no Commitments outstanding, then Lenders holding more than 50% of the Loans.

  
 “Requirement of Law” for any Person
shall mean the articles or certificate of incorporation and bylaws or other organizational or governing documents of such Person, and any law, treaty, rule or regulation, or determination of an arbitrator or a court or other governmental authority,
in each case applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject. 
  
 “Responsible Officer” shall mean any of the president, the chief executive officer, the chief operating officer, the chief
financial officer, the treasurer or a vice president of the Borrower or such other representative of the Borrower as may be designated in writing by any one of the foregoing with the consent of the Administrative Agent; and, with respect to the
financial covenants only, the chief financial officer or the treasurer of the Borrower. 
  

 15 

 “Restricted Payment” shall have the meaning set forth in Section 7.5.

  
 “Revolving Commitment” shall mean,
with respect to each Lender, the obligation of such Lender to make Revolving Loans to the Borrower and to participate in Letters of Credit and Swingline Loans in an aggregate principal amount not exceeding the amount set forth with respect to such
Lender on the signature pages to this Agreement, or in the case of a Person becoming a Lender after the Closing Date, the amount of the assigned “Revolving Commitment” as provided in the Assignment and Acceptance Agreement executed by such
Person as an assignee, as the same may be increased or deceased pursuant to terms hereof. 
  
 “Revolving Commitment Termination Date,” or “Commitment Termination Date” shall mean the earliest of (i) July 15, 2007, (ii) the date on which the
Revolving Commitments are terminated pursuant to Section 2.8 and (iii) the date on which all amounts outstanding under this Agreement have been declared or have automatically become due and payable (whether by acceleration or otherwise).

  
 “Revolving Credit Availability Period”
shall mean the period from the Closing Date to the Revolving Commitment Termination Date. 
  
 “Revolving Credit Exposure” shall mean, for any Lender, the sum of such Lender’s Revolving Loans, such Lender’s LC Exposure and Swingline Exposure. 
  
 “Revolving Credit Note” shall mean a promissory note
of the Borrower payable to the order of a requesting Lender in the principal amount of such Lender’s Revolving Commitment, in substantially the form of Exhibit A. 
  
 “Revolving Loan” shall mean a loan made by a Lender (other than the Swingline Lender) to the
Borrower under its Revolving Commitment, which may either be a Base Rate Loan or a Eurodollar Loan. 
  
 “S&P” shall mean Standard & Poor’s. 
  
 “Senior Notes” shall mean the senior notes of the Borrower in an aggregate principal amount of
$30,000,000 issued and sold pursuant to the Senior Note Documents. 
  
 “Senior Note Documents” shall mean the Senior Notes, the indenture relating to, incorporating and providing for the issuance of the Senior Notes and all other applicable agreements, instruments and other documents.

  
 “Subsidiary” shall mean, with respect
to any Person (the “parent”), any corporation, partnership, joint venture, limited liability company, association or other entity the accounts of which would be consolidated with those of the parent in the parent’s
consolidated financial statements if such financial statements were prepared in accordance with GAAP as of such date, as well as any other corporation, partnership, joint venture, limited liability company, association or other entity (i) of which
securities or other ownership interests representing more than 50% of the equity or more than 50% of the ordinary voting power, or in the case of a partnership, more than 50% of the general partnership interests are, as of such date, owned, 

  

 16 

 
controlled or held, or (ii) that is, as of such date, otherwise controlled, by the parent or one or more subsidiaries of the parent or by the parent and one
or more subsidiaries of the parent. Unless otherwise indicated, all references to “Subsidiary” hereunder shall mean a Subsidiary of the Borrower. 
  
 “Subsidiary Guaranty Agreement” shall mean the First Amended and Restated Subsidiary Guaranty Agreement, substantially in the form
of Exhibit D, made by the Subsidiary Loan Parties in favor of the Administrative Agent for the benefit of the Lenders, as amended, restated, supplemented or otherwise modified from time to time. 
  
 “Subsidiary Loan Party” shall mean any Subsidiary
that is not a Foreign Subsidiary. 
  
 “Swingline
Commitment” shall mean the commitment of the Swingline Lender to make Swingline Loans in an aggregate principal amount at any time outstanding not to exceed $5,000,000. 
  
 “Swingline Exposure” shall mean, with respect to each Lender, the principal amount of the Swingline
Loans in which such Lender is legally obligated either to make a Base Rate Loan or to purchase a participation in accordance with Section 2.5, which shall equal such Lender’s Pro Rata Share of all outstanding Swingline Loans. 

 
 “Swingline Lender” shall mean SunTrust Bank, or
any other Lender that may agree to make Swingline Loans hereunder. 
  
 “Swingline Loan” shall mean a loan made to the Borrower by the Swingline Lender under the Swingline Commitment. 
  
 “Swingline Note” shall mean the promissory note of the Borrower payable to the order of the Swingline Lender in the principal
amount of the Swingline Commitment, substantially the form of Exhibit D. 
  
 “Swingline Rate” shall mean, for any Interest Period, the rate as offered by the Administrative Agent and accepted by the Borrower. The Borrower shall have no obligation to accept this rate and
the Administrative Agent shall have no obligation to provide this rate. 
  
 “Taxes” shall mean any and all present or future taxes, levies, imposts, duties, deductions, charges or withholdings imposed by any Governmental Authority. 
  
 “Timber Market Value” shall mean the
lessor of (i) the fair market value of all timber owned by the Borrower or any of its Subsidiaries as determined by reference to the average price received by Borrower or any of its Subsidiaries for their sales of timber for the preceding four
quarters multiplied by the current quarter’s ending inventory of timber, or (ii) if an appraisal is requested by the Administrative Agent, the appraised value of all timber owned by the Borrower or any of its Subsidiaries as determined in
accordance with Section 5.7. 
  

 17 

 “Total Debt to EBITDA Ratio” shall mean, as of any date of determination, the
ratio of (a) Consolidated Total Debt as of such date to (b) Consolidated EBITDA for the four fiscal quarter period ending on or immediately prior to such date. 
  

“Total Senior Indebtedness” shall mean the Aggregate Revolving Commitment plus the Indebtedness evidenced by the Senior Notes
and the Note Purchase Agreement. 
  
 “Type”, when used in reference to a Loan or Borrowing, refers to whether the rate of interest on such Loan, or on the Loans comprising such Borrowing, is determined by reference to the Adjusted LIBO Rate or the Base
Rate. 
  
 “Withdrawal Liability” shall
mean liability to a Multiemployer Plan as a result of a complete or partial withdrawal from such Multiemployer Plan, as such terms are defined in Part I of Subtitle E of Title IV of ERISA. 
  
 Section 1.2. Classifications of Loans and Borrowings. For
purposes of this Agreement, Loans may be classified and referred to by Class (e.g. a “Revolving Loan”) or by Type (e.g. a “Eurodollar Loan” or “Base Rate Loan”) or by Class and Type (e.g. “Revolving Eurodollar
Loan”). Borrowings also may be classified and referred to by Class (e.g. “Revolving Borrowing”) or by Type (e.g. “Eurodollar Borrowing”) or by Class and Type (e.g. “ Revolving Eurodollar Borrowing”). 
  
 Section 1.3. Accounting Terms and Determination. Unless
otherwise defined or specified herein, all accounting terms used herein shall be interpreted, all accounting determinations hereunder shall be made, and all financial statements required to be delivered hereunder shall be prepared, in accordance
with GAAP as in effect from time to time, applied on a basis consistent with the most recent audited consolidated financial statement of the Borrower delivered pursuant to Section 5.1(a); provided, that if the Borrower notifies the
Administrative Agent that the Borrower wishes to amend any covenant in Article VI to eliminate the effect of any change in GAAP on the operation of such covenant (or if the Administrative Agent notifies the Borrower that the Required Lenders wish to
amend Article VI for such purpose), then the Borrower’s compliance with such covenant shall be determined on the basis of GAAP in effect immediately before the relevant change in GAAP became effective, until either such notice is withdrawn or
such covenant is amended in a manner satisfactory to the Borrower and the Required Lenders. 
  
 Section 1.4. Terms Generally. The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include
the corresponding masculine, feminine and neuter forms. The words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”. The word “will” shall be
construed to have the same meaning and effect as the word “shall”. In the computation of periods of time from a specified date to a later specified date, the word “from” means “from and including” and the word
“to” means “to but excluding”. Unless the context requires otherwise (i) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other
document as it was originally executed or as it may from time to time be 

  

 18 

 
amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein), (ii) any
reference herein to any Person shall be construed to include such Person’s successors and permitted assigns, (iii) the words “hereof”, “herein” and “hereunder” and words of similar import shall be construed to
refer to this Agreement as a whole and not to any particular provision hereof, (iv) all references to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles, Sections, Exhibits and Schedules to this Agreement and (v) all
references to a specific time shall be construed to refer to the time in the city and state of the Administrative Agent’s principal office, unless otherwise indicated. 
  
 ARTICLE II 
  
 AMOUNT AND TERMS OF THE COMMITMENTS 
  
 Section 2.1. General Description of Facilities. Subject to and upon the terms and conditions herein set forth, (i) the Lenders hereby
establish in favor of the Borrower a revolving credit facility pursuant to which the Lenders severally agree (to the extent of such Lender’s Revolving Commitment) to make Revolving Loans to the Borrower in accordance with Section 2.2,
(ii) the Issuing Bank agrees to issue Letters of Credit in accordance with Section 2.23, (iii) the Swingline Lender agrees to make Swingline Loans in accordance with Section 2.4, and (iv) each Lender agrees to purchase a participation
interest in the Letters of Credit and the Swingline Loans pursuant to the terms and conditions hereof; provided, that in no event shall the aggregate principal amount of all outstanding Revolving Loans, Swingline Loans and outstanding LC
Exposures exceed at any time the Aggregate Revolving Commitments from time to time in effect. 
  
 Section 2.2. Revolving Loans. Subject to the terms and conditions set forth herein, each Lender severally agrees to make Revolving Loans to the Borrower, from time to time during the Availability Period,
in an aggregate principal amount outstanding at any time that will not result in (a) such Lender’s Revolving Credit Exposure exceeding such Lender’s Revolving Commitment or (b) the sum of the aggregate Revolving Credit Exposures of all
Lenders exceeding the Aggregate Revolving Commitments. During the Availability Period, the Borrower shall be entitled to borrow, prepay and reborrow Revolving Loans in accordance with the terms and conditions of this Agreement; provided, that
the Borrower may not borrow or reborrow should there exist a Default or Event of Default. 
  
 Section 2.3. Procedure for Revolving Borrowings. The Borrower shall give the Administrative Agent written notice (or telephonic notice promptly confirmed in writing) of each Revolving Borrowing
substantially in the form of Exhibit 2.3 attached hereto (a “Notice of Revolving Borrowing”) (x) prior to 11:00 a.m. one (1) Business Day prior to the requested date of each Base Rate Borrowing and (y) prior to 11:00
a.m. three (3) Business Days prior to the requested date of each Eurodollar Borrowing. Each Notice of Revolving Borrowing shall be irrevocable and shall specify: (i) the aggregate principal amount of such Borrowing, (ii) the date of such Borrowing
(which shall be a Business Day), (iii) the Type of such Revolving 

  

 19 

 
Loan comprising such Borrowing and (iv) in the case of a Eurodollar Borrowing, the duration of the initial Interest Period applicable thereto (subject to the
provisions of the definition of Interest Period). Each Revolving Borrowing shall consist entirely of Base Rate Loans or Eurodollar Loans, as the Borrower may request. The aggregate principal amount of each Eurodollar Borrowing shall be not less than
$2,000,000 or a larger multiple of $1,000,000, and the aggregate principal amount of each Base Rate Borrowing shall not be less than $1,000,000 or a larger multiple of $100,000; provided, that Base Rate Loans made pursuant to Section
2.5 may be made in lesser amounts as provided therein. At no time shall the total number of Eurodollar Borrowings outstanding at any time exceed six. Promptly following the receipt of a Notice of Revolving Borrowing in accordance herewith, the
Administrative Agent shall advise each Lender of the details thereof and the amount of such Lender’s Revolving Loan to be made as part of the requested Revolving Borrowing. 
  
 Section 2.4. Swingline Commitment. Subject to the terms and conditions set forth herein, the Swingline Lender
agrees to make Swingline Loans to the Borrower, from time to time from the Closing Date to the Revolving Commitment Termination Date, in an aggregate principal amount outstanding at any time not to exceed the lesser of (i) the Swingline Commitment
then in effect and (ii) the difference between the Aggregate Revolving Commitments and the aggregate Revolving Credit Exposures of all Lenders; provided, that the Swingline Lender shall not be required to make a Swingline Loan to refinance an
outstanding Swingline Loan. The Borrower shall be entitled to borrow, repay and reborrow Swingline Loans in accordance with the terms and conditions of this Agreement. 
  
 Section 2.5. Procedure for Swingline Borrowing; Etc. (a) The Borrower shall give the Administrative Agent
written notice (or telephonic notice promptly confirmed in writing) of each Swingline Borrowing (“Notice of Swingline Borrowing”) prior to 12:00 noon on the requested date of each Swingline Borrowing. Each Notice of Swingline
Borrowing shall be irrevocable and shall specify: (i) the principal amount of such Swingline Loan, (ii) the date of such Swingline Loan (which shall be a Business Day) and (iii) the account of the Borrower to which the proceeds of such Swingline
Loan should be credited. The Administrative Agent will promptly advise the Swingline Lender of each Notice of Swingline Borrowing. Each Swingline Loan shall accrue interest at the Swingline Rate and shall have an Interest Period (subject to the
definition thereof) as agreed between the Borrower and the Swingline Lender. The aggregate principal amount of each Swingline Loan shall be not less than $100,000 or a larger multiple of $50,000, or such other minimum amounts agreed to by the
Swingline Lender and the Borrower. The Swingline Lender will make the proceeds of each Swingline Loan available to the Borrower in Dollars in immediately available funds at the account specified by the Borrower in the applicable Notice of Swingline
Borrowing not later than 3:00 p.m. on the requested date of such Swingline Loan. The Administrative Agent will notify the Lenders on a quarterly basis if any Swingline Loans occurred during such quarter. 
  
 (b) The Swingline Lender, at any time and from time to time in its sole
discretion, may, on behalf of the Borrower (which hereby irrevocably authorizes and directs the Swingline Lender to act on its behalf), give a Notice of Revolving Borrowing to the Administrative Agent requesting the Lenders (including the Swingline
Lender) to make Base Rate Loans in an amount equal to the unpaid principal amount of any Swingline Loan. Each 

  

 20 

 
Lender will make the proceeds of its Base Rate Loan included in such Borrowing available to the Administrative Agent for the account of the Swingline Lender
in accordance with Section 2.6, which will be used solely for the repayment of such Swingline Loan. 
  
 (c) If for any reason a Base Rate Borrowing may not be (as determined in the sole discretion of the Administrative Agent), or is not, made in accordance
with the foregoing provisions, then each Lender (other than the Swingline Lender) shall purchase an undivided participating interest in such Swingline Loan in an amount equal to its Pro Rata Share thereof on the date that such Base Rate Borrowing
should have occurred. On the date of such required purchase, each Lender shall promptly transfer, in immediately available funds, the amount of its participating interest to the Administrative Agent for the account of the Swingline Lender. If such
Swingline Loan bears interest at a rate other than the Base Rate, such Swingline Loan shall automatically become a Base Rate Loan on the effective date of any such participation and interest shall become payable on demand. 
  
 (d) Each Lender’s obligation to make a Base Rate Loan pursuant to
Section 2.5(b) or to purchase the participating interests pursuant to Section 2.5(c) shall be absolute and unconditional and shall not be affected by any circumstance, including without limitation (i) any setoff, counterclaim,
recoupment, defense or other right that such Lender or any other Person may have or claim against the Swingline Lender, the Borrower or any other Person for any reason whatsoever, (ii) the existence of a Default or an Event of Default or the
termination of any Lender’s Revolving Commitment, (iii) the existence (or alleged existence) of any event or condition which has had or could reasonably be expected to have a Material Adverse Effect, (iv) any breach of this Agreement or any
other Loan Document by the Borrower, the Administrative Agent or any Lender or (v) any other circumstance, happening or event whatsoever, whether or not similar to any of the foregoing. If such amount is not in fact made available to the Swingline
Lender by any Lender, the Swingline Lender shall be entitled to recover such amount on demand from such Lender, together with accrued interest thereon for each day from the date of demand thereof at the Federal Funds Rate. Until such time as such
Lender makes its required payment, the Swingline Lender shall be deemed to continue to have outstanding Swingline Loans in the amount of the unpaid participation for all purposes of the Loan Documents. In addition, such Lender shall be deemed to
have assigned any and all payments made of principal and interest on its Loans and any other amounts due to it hereunder, to the Swingline Lender to fund the amount of such Lender’s participation interest in such Swingline Loans that such
Lender failed to fund pursuant to this Section, until such amount has been purchased in full. 
  
 Section 2.6. Funding of Borrowings. 
  
 (a) Each Lender will make available each Loan to be made by it hereunder on the proposed date thereof by wire transfer in immediately available funds by 1:00 p.m. to the Administrative Agent at the Payment Office;
provided, that the Swingline Loans will be made as set forth in Section 2.5. The Administrative Agent will make such Loans available to the Borrower by promptly crediting the amounts that it receives, in like funds by the close of
business on such proposed date, to an account maintained by the Borrower with the Administrative Agent or at the Borrower’s option, by effecting a wire transfer of such amounts to an account designated by the Borrower to the Administrative
Agent. 
  

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 (b) Unless the Administrative Agent shall have been notified by any Lender prior to 5 p.m. one (1)
Business Day prior to the date of a Borrowing in which such Lender is participating that such Lender will not make available to the Administrative Agent such Lender’s share of such Borrowing, the Administrative Agent may assume that such Lender
has made such amount available to the Administrative Agent on such date, and the Administrative Agent, in reliance on such assumption, may make available to the Borrower on such date a corresponding amount. If such corresponding amount is not in
fact made available to the Administrative Agent by such Lender on the date of such Borrowing, the Administrative Agent shall be entitled to recover such corresponding amount on demand from such Lender together with interest at the Federal Funds Rate
for up to two (2) days and thereafter at the rate specified for such Borrowing. If such Lender does not pay such corresponding amount forthwith upon the Administrative Agent’s demand therefor, the Administrative Agent shall promptly notify the
Borrower, and the Borrower shall immediately pay such corresponding amount to the Administrative Agent together with interest at the rate specified for such Borrowing. Nothing in this subsection shall be deemed to relieve any Lender from its
obligation to fund its Pro Rata Share of any Borrowing hereunder or to prejudice any rights which the Borrower may have against any Lender as a result of any default by such Lender hereunder. 
  
 (c) All Revolving Borrowings shall be made by the Lenders on the basis of
their respective Pro Rata Shares. No Lender shall be responsible for any default by any other Lender in its obligations hereunder, and each Lender shall be obligated to make its Loans provided to be made by it hereunder, regardless of the failure of
any other Lender to make its Loans hereunder. 
  
 Section 2.7.
Interest Elections. 
  
 (a) Each Borrowing initially
shall be of the Type specified in the applicable Notice of Borrowing, and in the case of a Eurodollar Borrowing, shall have an initial Interest Period as specified in such Notice of Borrowing. Thereafter, the Borrower may elect to convert such
Borrowing into a different Type or to continue such Borrowing, and in the case of a Eurodollar Borrowing, may elect Interest Periods therefor, all as provided in this Section. The Borrower may elect different options with respect to different
portions of the affected Borrowing, in which case each such portion shall be allocated ratably among the Lenders holding Loans comprising such Borrowing, and the Loans comprising each such portion shall be considered a separate Borrowing. This
Section shall NOT apply to Swingline Borrowings, which may not be converted or continued. 
  
 (b) To make an election pursuant to this Section, the Borrower shall give the Administrative Agent prior written notice (or telephonic notice promptly confirmed in writing) of each Borrowing (a “Notice of
Conversion/Continuation”) that is to be converted or continued, as the case may be, (x) prior to 10:00 a.m. one (1) Business Day prior to the requested date of a conversion into a Base Rate Borrowing and (y) prior to 11:00 a.m. three
(3) Business Days prior to a continuation of or conversion into a Eurodollar Borrowing. Each such Notice of Conversion/Continuation shall be irrevocable and shall specify (i) the Borrowing to which such Notice of Continuation/Conversion applies and
if different options are being elected with respect to different portions thereof, the portions thereof that are to be allocated to each resulting 

  

 22 

 
Borrowing (in which case the information to be specified pursuant to clauses (iii) and (iv) shall be specified for each resulting Borrowing); (ii) the
effective date of the election made pursuant to such Notice of Continuation/Conversion, which shall be a Business Day, (iii) whether the resulting Borrowing is to be a Base Rate Borrowing or a Eurodollar Borrowing; and (iv) if the resulting
Borrowing is to be a Eurodollar Borrowing, the Interest Period applicable thereto after giving effect to such election, which shall be a period contemplated by the definition of “Interest Period”. If any such Notice of
Continuation/Conversion requests a Eurodollar Borrowing but does not specify an Interest Period, the Borrower shall be deemed to have selected an Interest Period of one month. The principal amount of any resulting Borrowing shall satisfy the minimum
borrowing amount for Eurodollar Borrowings and Base Rate Borrowings set forth in Section 2.3. 
  
 (c) If, on the expiration of any Interest Period in respect of any Eurodollar Borrowing, the Borrower shall have failed to deliver a Notice of Conversion/
Continuation, then, unless such Borrowing is repaid as provided herein, the Borrower shall be deemed to have elected to convert such Borrowing to a Base Rate Borrowing. No Borrowing may be converted into, or continued as, a Eurodollar Borrowing if a
Default or an Event of Default exists, unless the Administrative Agent and each of the Lenders shall have otherwise consented in writing. No conversion of any Eurodollar Loans shall be permitted except on the last day of the Interest Period in
respect thereof. 
  
 (d) Upon receipt of any Notice of
Conversion/Continuation, the Administrative Agent shall promptly notify each Lender of the details thereof and of such Lender’s portion of each resulting Borrowing. 
  
 Section 2.8. Optional Reduction and Termination of Commitments. 
  
 (a) Unless previously terminated, all Revolving Commitments shall terminate
on the Revolving Commitment Termination Date. 
  
 (b) Upon at
least three (3) Business Days’ prior written notice (or telephonic notice promptly confirmed in writing) to the Administrative Agent (which notice shall be irrevocable), the Borrower may reduce the Aggregate Revolving Commitments in part or
terminate the Aggregate Revolving Commitments in whole; provided, that (i) any partial reduction shall apply to reduce proportionately and permanently the Revolving Commitment of each Lender, (ii) any partial reduction pursuant to this
Section 2.8 shall be in an amount of at least $2,000,000 and any larger multiple of $1,000,000, and (iii) no such reduction shall be permitted which would reduce the Aggregate Revolving Commitments to an amount less than the outstanding
Revolving Credit Exposures of all Lenders. Any such reduction in the Aggregate Revolving Commitments shall result in a proportionate reduction (rounded to the next lowest integral multiple of $100,000) in the Swingline Commitment. 
  
 Section 2.9. Repayment of Loans. 
  
 (a) The outstanding principal amount of all Revolving Loans shall be due and
payable (together with accrued and unpaid interest thereon) on the Revolving Commitment Termination Date. 
  

 23 

 (b) The principal amount of each Swingline Borrowing shall be due and payable (together with accrued
interest thereon) on the earlier of (i) the last day of the Interest Period applicable to such Borrowing and (ii) the Revolving Commitment Termination Date. 
  
 Section 2.10. Evidence of Indebtedness. 
  
 (a) Each Lender shall maintain in accordance with its usual practice appropriate records evidencing the indebtedness of the Borrower to such Lender
resulting from each Loan made by such Lender from time to time, including the amounts of principal and interest payable thereon and paid to such Lender from time to time under this Agreement. The Administrative Agent shall maintain appropriate
records in which shall be recorded (i) the Revolving Commitment of each Lender, (ii) the amount of each Loan made hereunder by each Lender, the Class and Type thereof and the Interest Period applicable thereto, (iii) the date of each continuation
thereof pursuant to Section 2.7, (iv) the date of each conversion of all or a portion thereof to another Type pursuant to Section 2.7, (v) the date and amount of any principal or interest due and payable or to become due and payable
from the Borrower to each Lender hereunder in respect of such Loans and (vi) both the date and amount of any sum received by the Administrative Agent hereunder from the Borrower in respect of the Loans and each Lender’s Pro Rata Share thereof.
The entries made in such records shall be prima facie evidence of the existence and amounts of the obligations of the Borrower therein recorded; provided, that the failure or delay of any Lender or the Administrative Agent in
maintaining or making entries into any such record or any error therein shall not in any manner affect the obligation of the Borrower to repay the Loans (both principal and unpaid accrued interest) of such Lender in accordance with the terms of this
Agreement. 
  
 (b) At the request of any Lender (including the
Swingline Lender) at any time, the Borrower agrees that it will execute and deliver to such Lender a Revolving Credit Note and, in the case of the Swingline Lender only, a Swingline Note, payable to the order of such Lender. 
  
 Section 2.11. Prepayments. 
  
 (a) The Borrower shall have the right at any time and from time to time to
prepay any Borrowing, in whole or in part, without premium or penalty, by giving irrevocable written notice (or telephonic notice promptly confirmed in writing) to the Administrative Agent no later than (i) in the case of prepayment of any
Eurodollar Borrowing, 11:00 a.m. not less than three (3) Business Days prior to any such prepayment, (ii) in the case of any prepayment of any Base Rate Borrowing, not less than one Business Day prior to the date of such prepayment, and (iii) in the
case of Swingline Borrowings, prior to 11:00 a. m. on the date of such prepayment. Each such notice shall be irrevocable and shall specify the proposed date of such prepayment and the principal amount of each Borrowing or portion thereof to be
prepaid. Upon receipt of any such notice, the Administrative Agent shall promptly notify each affected Lender of the contents thereof and of such Lender’s Pro Rata Share of any such prepayment. If such notice is given, the aggregate amount
specified in such notice shall be due and payable on the date designated in such notice, together with accrued interest to such date on the amount so prepaid in accordance with Section 2.12(d); provided, that if a Eurodollar Borrowing
is prepaid on a date other than the last day of an Interest Period applicable thereto, the Borrower shall also pay all amounts required pursuant to Section 2.18. Each partial prepayment of any Loan (other than a Swingline Loan) shall be in an
amount that would be permitted in the case of an advance of a Revolving 

  

 24 

 
Borrowing of the same Type pursuant to Section 2.3 or in the case of a Swingline Loan pursuant to Section 2.5. Each prepayment of a Borrowing
shall be applied ratably to the Loans comprising such Borrowing. 
  
 (b) If at any time the Revolving Credit Exposure of all Lenders exceeds the aggregate principal amount of the Revolving Credit Commitments at such time, the Borrower shall immediately repay Swingline Loans and Revolving Loans in an amount
equal to such excess, together with all accrued and unpaid interest on such excess amount and any amounts due under Section 2.18. Each prepayment of a Borrowing shall be applied ratably first to the Swingline Loans to the full extent thereof,
then to the Revolving Base Rate Loans to the full extent thereof, and finally to Revolving Eurodollar Loans to the full extent thereof. 
  
 (c) Immediately upon receipt by the Borrower of proceeds of the sale or disposition by the Borrower or any of its Subsidiaries of any of their assets
(other than proceeds from the sale of assets in the ordinary course of business), the total consideration of which exceeds $5,000,000 in the aggregate (including condemnation proceeds), the Borrower shall prepay the Loans in an amount equal to all
such proceeds, net of commissions, taxes paid or reasonably estimated by the Borrower to be payable in connection with such transaction in the current year or the immediately following year and other reasonable and customary transaction costs, fees
and expenses properly attributable to such transaction and payable by the Borrower in connection therewith (in each case, paid to non-Affiliates) provided, however, if the Borrower intends to (i) enter into an Asset Like Kind Exchange, the
Borrower shall have no obligation to so prepay the Loans if, within 180 days of receipt of such proceeds, the Borrower shall have used such net cash proceeds for the purchase of timber or real estate assets to replace the sold or disposed assets
according to the terms of such Asset Like Kind Exchange; or (ii) replace any other assets, the Borrower shall have no obligation to so prepay the Loans if, within 180 days of receipt of such proceeds, the Borrower shall have used such net cash
proceeds for capital investments to replace the sold or disposed assets; provided, further, however, that if such Asset Like Kind Exchange or capital investment does not occur within such 180-day period, such prepayment shall be due on the
first Business Day following the expiration of the applicable Asset Like Kind Exchange or capital investment period set forth above along with a detailed calculation showing all deductions from gross proceeds in order to arrive at net cash proceeds.
Any such prepayments shall be applied in accordance with paragraph (e) below. 
  
 (d) If the Borrower issues any capital stock, any other equity interests, or any debt securities (other than notes payable issued in connection with any timber land acquisition), then no later than the Business Day
following the date of receipt of any cash proceeds thereof, the Borrower shall prepay the Loans in an amount equal to all such cash proceeds, net of underwriting discounts and commissions and other reasonable costs paid to non-Affiliates in
connection therewith. Any such prepayment shall be applied in accordance with paragraph (e) below. 
  
 (e) Any prepayments made by the Borrower pursuant to paragraphs (c) or (d) above shall be applied as follows: first, to fees and reimbursable
expenses of the Administrative Agent then due and payable pursuant to any of the Loan Documents; second, to all other fees and reimbursable expenses of the Lenders then due and payable pursuant to any of the Loan 

  

 25 

 
Documents, pro rata to the Lenders based on their respective Pro Rata Shares of thereof; third, to interest then due and payable on Loans made to the
Borrower, pro rata to the Lenders based on their respective Pro Rata Shares thereof; and fourth, to the principal balance of the Revolving Loans until the same shall have been paid in full, pro rata to the Lenders based on their respective
Pro Rata Shares thereof. 
  
 Section 2.12. Interest on
Loans. 
  
 (a) The Borrower shall pay interest on each
Base Rate Loan at the Base Rate plus the Applicable Margin for Base Rate Loans, in each case as in effect from time to time, and on each Eurodollar Loan at the Adjusted LIBO Rate for the applicable Interest Period in effect for such Loan,
plus the Applicable Margin for Eurodollar Loans in effect from time to time. 
  
 (b) The Borrower shall pay interest on each Swingline Loan at the Swingline Rate in effect from time to time. 
  
 (c) While an Event of Default exists or after acceleration, at the option of the Required Lenders, the Borrower shall pay interest (“Default
Interest”) with respect to all Eurodollar Loans at the rate otherwise applicable for the then-current Interest Period plus an additional 2% per annum until the last day of such Interest Period, and thereafter, and with respect to
all Base Rate Loans (including all Swingline Loans) and all other Obligations hereunder (other than Loans), at an all-in rate in effect for Base Rate Loans, plus an additional 2% per annum. 
  
 (d) Interest on the principal amount of all Loans shall accrue from and
including the date such Loans are made to but excluding the date of any repayment thereof. Interest on all outstanding Base Rate Loans and Swingline Loans shall be payable quarterly in arrears on the last day of each March, June, September and
December and on the Revolving Commitment Termination Date. Interest on all outstanding Eurodollar Loans shall be payable on the last day of each Interest Period applicable thereto, and, in the case of any Eurodollar Loans having an Interest Period
in excess of three months or 90 days, on each day which occurs every three months or 90 days, as the case may be, after the initial date of such Interest Period, and on the Revolving Commitment Termination Date. Interest on any Loan which is
converted into a Loan of another Type or which is repaid or prepaid shall be payable on the date of such conversion or on the date of any such repayment or prepayment (on the amount repaid or prepaid) thereof. All Default Interest shall be payable
on demand. 
  
 (e) The Administrative Agent shall determine each
interest rate applicable to the Loans hereunder and shall promptly notify the Borrower and the Lenders of such rate in writing (or by telephone, promptly confirmed in writing). Any such determination shall be conclusive and binding for all purposes,
absent manifest error. 
  
 Section 2.13. Fees.

  
 (a) The Borrower shall pay to the Administrative Agent for
its own account fees in the amounts and at the times previously agreed upon by the Borrower and the Administrative Agent. 
  

 26 

 (b) Commitment Fee. The Borrower agrees to pay to the Administrative Agent for the account of each
Lender a commitment fee, which shall accrue at the Applicable Commitment Fee Percentage (determined daily in accordance with Schedule I) on the daily amount of the unused Revolving Commitment of such Lender during the Availability Period.
Accrued commitment fees shall be payable in arrears on the last day of each March, June, September and December of each year and on the Revolving Commitment Termination Date, commencing on the first such date after the Closing Date. For purposes of
computing commitment fees with respect to the Revolving Commitments, the Revolving Commitment of each Lender shall be deemed used to the extent of the outstanding Revolving Loans of such Lender. 
  
 (c) Letter of Credit Fees. The Borrower agrees to pay (i) to the
Administrative Agent, for the account of each Lender, a Letter of Credit fee with respect to its participation in each Letter of Credit, which shall accrue at the Applicable Margin for Eurodollar Loans then in effect on the average daily amount of
such Lender’s LC Exposure (excluding any portion thereof attributable to unreimbursed LC Disbursements) attributable to such Letter of Credit during the period from and including the date of issuance of such Letter of Credit to but excluding
the date on which such Letter of Credit expires or is drawn in full (including without limitation any LC Exposure that remains outstanding after the Commitment Termination Date) and (ii) to the Issuing Bank for its own account a fronting fee, which
shall accrue at the rate of 0.125% per annum on the average daily amount of the LC Exposure (excluding any portion thereof attributable to unreimbursed LC Disbursements) during the Availability Period (or until the date that such Letter of Credit is
irrevocably canceled, whichever is later), as well as the Issuing Bank’s standard fees with respect to issuance, amendment, renewal or extension of any Letter of Credit or processing of drawings thereunder. 
  
 (d) Payments. Accrued fees shall be payable quarterly in arrears on
the last day of each March, June, September and December, commencing on December 31, 2003 and on the Revolving Commitment Termination Date (and if later, the date the Loans shall be repaid in their entirety). 
  
 Section 2.14. Computation of Interest and Fees.

  
 All computations of interest and fees hereunder shall be made
on the basis of a year of 360 days for the actual number of days (including the first day but excluding the last day) occurring in the period for which such interest or fees are payable (to the extent computed on the basis of days elapsed). Each
determination by the Administrative Agent of an interest amount or fee hereunder shall be made in good faith and, except for manifest error, shall be final, conclusive and binding for all purposes. 
  
 Section 2.15. Inability to Determine Interest Rates. If
prior to the commencement of any Interest Period for any Eurodollar Borrowing, 
  
 (i) the Administrative Agent shall have determined (which determination shall be conclusive and binding upon the Borrower) that, by reason
of circumstances 
  

 27 

 affecting the relevant interbank market, adequate means do not exist for ascertaining LIBOR for such
Interest Period, or 
  
 (ii) the Administrative
Agent shall have received notice from the Required Lenders that the Adjusted LIBO Rate does not adequately and fairly reflect the cost to such Lenders (or Lender, as the case may be) of making, funding or maintaining their (or its, as the case may
be) Eurodollar Loans for such Interest Period, 
  
 the Administrative Agent shall
give written notice (or telephonic notice, promptly confirmed in writing) to the Borrower and to the Lenders as soon as practicable thereafter. In the case of Eurodollar Loans, until the Administrative Agent shall notify the Borrower and the Lenders
that the circumstances giving rise to such notice no longer exist, (i) the obligations of the Lenders to make Eurodollar Revolving Loans or to continue or convert outstanding Loans as or into Eurodollar Loans shall be suspended and (ii) all such
affected Loans shall be converted into Base Rate Loans on the last day of the then current Interest Period applicable thereto unless the Borrower prepays such Loans in accordance with this Agreement. Unless the Borrower notifies the Administrative
Agent at least one Business Day before the date of any Eurodollar Revolving Borrowing for which a Notice of Revolving Borrowing has previously been given that it elects not to borrow on such date, then such Revolving Borrowing shall be made as a
Base Rate Borrowing. 
  
 Section 2.16.
Illegality. If any Change in Law shall make it unlawful or impossible for any Lender to make, maintain or fund any Eurodollar Loan and such Lender shall so notify the Administrative Agent, the Administrative Agent shall promptly give
notice thereof to the Borrower and the other Lenders, whereupon until such Lender notifies the Administrative Agent and the Borrower that the circumstances giving rise to such suspension no longer exist, the obligation of such Lender to make
Eurodollar Revolving Loans, or to continue or convert outstanding Loans as or into Eurodollar Loans, shall be suspended. In the case of the making of a Eurodollar Revolving Borrowing, such Lender’s Revolving Loan shall be made as a Base Rate
Loan as part of the same Revolving Borrowing for the same Interest Period and if the affected Eurodollar Loan is then outstanding, such Loan shall be converted to a Base Rate Loan either (i) on the last day of the then current Interest Period
applicable to such Eurodollar Loan if such Lender may lawfully continue to maintain such Loan to such date or (ii) immediately if such Lender shall determine that it may not lawfully continue to maintain such Eurodollar Loan to such date.
Notwithstanding the foregoing, the affected Lender shall, prior to giving such notice to the Administrative Agent, designate a different Applicable Lending Office if such designation would avoid the need for giving such notice and if such
designation would not otherwise be disadvantageous to such Lender in the good faith exercise of its discretion. 
  
 Section 2.17. Increased Costs. 
  
 (a) If any Change in Law shall: 
  
 (i) impose, modify or deem applicable any reserve, special deposit or similar requirement that is not otherwise included in the
determination of the Adjusted LIBO Rate hereunder against assets of, deposits with or for the account of, or credit extended 
  

 28 

 by, any Lender (except any such reserve requirement reflected in the Adjusted LIBO Rate) or the Issuing
Bank; or 
  
 (ii) impose on any Lender or upon the
Issuing Bank or the eurodollar interbank market any other condition affecting this Agreement or any Eurodollar Loans made by such Lender or any Letter of Credit or any participation therein; 
  
 and the result of the foregoing is to increase the cost to such Lender of making, converting
into, continuing or maintaining a Eurodollar Loan or to increase the cost to such Lender or the Issuing Bank of participating in or issuing any Letter of Credit or to reduce the amount received or receivable by such Lender or Issuing Bank hereunder
(whether of principal, interest or any other amount), then the Borrower shall promptly pay, upon written notice from and demand by such Lender on the Borrower (with a copy of such notice and demand to the Administrative Agent), to the Administrative
Agent for the account of such Lender, within five Business Days after the date of such notice and demand, additional amount or amounts sufficient to compensate such Lender or the Issuing Bank, as applicable, for such additional costs incurred or
reduction suffered. 
  
 (b) If any Lender or the Issuing Bank
shall have determined that on or after the date of this Agreement any Change in Law regarding capital requirements has or would have the effect of reducing the rate of return on such Lender’s or the Issuing Bank’s capital (or on the
capital of such Lender’s or the Issuing Bank’s parent corporation) as a consequence of its obligations hereunder or under or in respect of any Letter of Credit to a level below that which such Lender or the Issuing Bank or such
Lender’s or the Issuing Bank’s parent corporation could have achieved but for such Change in Law (taking into consideration such Lender’s or the Issuing Bank’s policies or the policies of such Lender’s or the Issuing
Bank’s parent corporation with respect to capital adequacy) then, from time to time, within five (5) Business Days after receipt by the Borrower of written demand by such Lender (with a copy thereof to the Administrative Agent), the Borrower
shall pay to such Lender such additional amounts as will compensate such Lender or the Issuing Bank or such Lender’s or the Issuing Bank’s parent corporation for any such reduction suffered. 
  
 (c) A certificate of a Lender or the Issuing Bank setting forth the amount or
amounts necessary to compensate such Lender or the Issuing Bank or such Lender’s or the Issuing Bank’s parent corporation, as the case may be, specified in paragraph (a) or (b) of this Section shall be delivered to the Borrower (with a
copy to the Administrative Agent) and shall be conclusive, absent manifest error. The Borrower shall pay any such Lender or such Issuing Bank, as applicable, such amount or amounts within 10 days after receipt thereof. 
  
 (d) Failure or delay on the part of any Lender or the Issuing Bank to demand
compensation pursuant to this Section shall not constitute a waiver of such Lender’s or the Issuing Bank’s right to demand such compensation. 
  
 Section 2.18. Funding Indemnity. In the event of (a) the payment of any principal of a Eurodollar Loan other than on the last day of
the Interest Period applicable thereto (including as a result of an Event of Default), (b) the conversion or continuation of a 

  

 29 

 
Eurodollar Loan other than on the last day of the Interest Period applicable thereto or (c) the failure by the Borrower to borrow, prepay, convert or
continue any Eurodollar Loan on the date specified in any applicable notice (regardless of whether such notice is withdrawn or revoked), then, in any such event, the Borrower shall compensate each Lender, within five (5) Business Days after written
demand from such Lender, for any loss, cost or expense attributable to such event. In the case of a Eurodollar Loan, such loss, cost or expense shall be deemed to include an amount determined by such Lender to be the excess, if any, of (A) the
amount of interest that would have accrued on the principal amount of such Eurodollar Loan if such event had not occurred at the Adjusted LIBO Rate applicable to such Eurodollar Loan for the period from the date of such event to the last day of the
then current Interest Period therefor (or in the case of a failure to borrow, convert or continue, for the period that would have been the Interest Period for such Eurodollar Loan) over (B) the amount of interest that would accrue on the principal
amount of such Eurodollar Loan for the same period if the Adjusted LIBO Rate were set on the date such Eurodollar Loan was prepaid or converted or the date on which the Borrower failed to borrow, convert or continue such Eurodollar Loan. A
certificate as to any additional amount payable under this Section 2.18 submitted to the Borrower by any Lender (with a copy to the Administrative Agent) shall be conclusive, absent manifest error. 
  
 Section 2.19. Taxes. 
  
 (a) Any and all payments by or on account of any obligation of the Borrower
hereunder shall be made free and clear of and without deduction for any Indemnified Taxes or Other Taxes; provided, that if the Borrower shall be required to deduct any Indemnified Taxes or Other Taxes from such payments, then (i) the sum
payable shall be increased as necessary so that after making all required deductions (including deductions applicable to additional sums payable under this Section) the Administrative Agent, any Lender or the Issuing Bank (as the case may be) shall
receive an amount equal to the sum it would have received had no such deductions been made, (ii) the Borrower shall make such deductions and (iii) the Borrower shall pay the full amount deducted to the relevant Governmental Authority in accordance
with applicable law. 
  
 (b) In addition, the Borrower shall pay
any Other Taxes to the relevant Governmental Authority in accordance with applicable law. 
  
 (c) The Borrower shall indemnify the Administrative Agent, each Lender and the Issuing Bank, within five (5) Business Days after written demand therefor, for the full amount of any Indemnified Taxes or Other Taxes
paid by the Administrative Agent, such Lender or the Issuing Bank, as the case may be, on or with respect to any payment by or on account of any obligation of the Borrower hereunder (including Indemnified Taxes or Other Taxes imposed or asserted on
or attributable to amounts payable under this Section) and any penalties, interest and reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or legally imposed or asserted
by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to the Borrower by a Lender or the Issuing Bank or by the Administrative Agent on its own behalf or on behalf of a Lender or the Issuing
Bank, shall be conclusive absent manifest error. 
  

 30 

 (d) As soon as practicable after any payment of Indemnified Taxes or Other Taxes by the Borrower to a
Governmental Authority, the Borrower shall deliver to the Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence
of such payment reasonably satisfactory to the Administrative Agent. 
  
 (e) Any Foreign Lender that is entitled to an exemption from or reduction of withholding tax under the Code or any treaty to which the United States is a party, with respect to payments under this Agreement shall deliver to the Borrower
(with a copy to the Administrative Agent), at the time or times prescribed by applicable law, such properly completed and executed documentation prescribed by applicable law or reasonably requested by the Borrower as will permit such payments to be
made without withholding or at a reduced rate. Without limiting the generality of the foregoing, each Foreign Lender agrees that it will deliver to the Administrative Agent and the Borrower (or in the case of a Participant, to the Lender from which
the related participation shall have been purchased), as appropriate, two (2) duly completed copies of (i) Internal Revenue Service Form W-8 ECI, or any successor form thereto, certifying that the payments received from the Borrower hereunder are
effectively connected with such Foreign Lender’s conduct of a trade or business in the United States; or (ii) Internal Revenue Service Form W-8 BEN, or any successor form thereto, certifying that such Foreign Lender is entitled to benefits
under an income tax treaty to which the United States is a party which reduces the rate of withholding tax on payments of interest; or (iii) Internal Revenue Service Form W-8 BEN, or any successor form prescribed by the Internal Revenue Service,
together with a certificate (A) establishing that the payment to the foreign lender qualifies as “portfolio interest” exempt from U.S. withholding tax under Code section 871(h) or 881(c), and (B) stating that (1) the Foreign Lender is not
a bank for purposes of Code section 881(c)(3)(A), or the obligation of the Borrower hereunder is not, with respect to such Foreign Lender, a loan agreement entered into in the ordinary course of its trade or business, within the meaning of
that section; (2) the Foreign Lender is not a 10% shareholder of the Borrower within the meaning of Code section 871(h)(3) or 881(c)(3)(B); and (3) the Foreign Lender is not a controlled foreign corporation that is related to the Borrower within the
meaning of Code section 881(c)(3)(C); or (iv) such other Internal Revenue Service forms as may be applicable to the Foreign Lender, including Forms W-8 IMY or W-8 EXP. Each such Foreign Lender shall deliver to the Borrower and the Administrative
Agent such forms on or before the date that it becomes a party to this Agreement (or in the case of a Participant, on or before the date such Participant purchases the related participation). In addition, each such Foreign Lender shall deliver such
forms promptly upon the obsolescence or invalidity of any form previously delivered by such Foreign Lender. Each such Foreign Lender shall promptly notify the Borrower and the Administrative Agent at any time that it determines that it is no longer
in a position to provide any previously delivered certificate to the Borrower (or any other form of certification adopted by the Internal Revenue Service for such purpose). 
  
 Section 2.20. Payments Generally; Pro Rata Treatment; Sharing of Set-offs. 
  
 (a) The Borrower shall make each payment required to be made by it hereunder
(whether of principal, interest, fees, or of amounts payable under Section 2.17, 2.18 or 

  

 31 

 
2.19, or otherwise) prior to 1:00 p.m., on the date when due, in immediately available funds, without set-off or counterclaim. Any amounts received
after such time on any date may, in the discretion of the Administrative Agent, be deemed to have been received on the next succeeding Business Day for purposes of calculating interest thereon. All such payments shall be made to the Administrative
Agent at the Payment Office, except payments to be made directly to the Issuing Bank or Swingline Lender as expressly provided herein and except that payments pursuant to Sections 2.17, 2.18 and 2.19 and 10.3 shall be
made directly to the Persons entitled thereto. The Administrative Agent shall distribute any such payments received by it for the account of any other Person to the appropriate recipient promptly following receipt thereof. If any payment hereunder
shall be due on a day that is not a Business Day, the date for payment shall be extended to the next succeeding Business Day, and, in the case of any payment accruing interest, interest thereon shall be made payable for the period of such extension.
All payments hereunder shall be made in Dollars. 
  
 (b) If at any
time insufficient funds are received by and available to the Administrative Agent to pay fully all amounts of principal, unreimbursed LC Disbursements interest and fees then due hereunder, such funds shall be applied (i) first, towards payment of
interest and fees then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of interest and fees then due to such parties, and (ii) second, towards payment of principal and unreimbursed LC Disbursements due
hereunder, ratably among the parties entitled thereto in accordance with the amounts of principal and unreimbursed LC Disbursements then due to such parties. 
  
 (c) If any Lender shall, by exercising any right of set-of or counterclaim or otherwise, obtain payment in respect of any principal of or interest on any
of its Revolving Loans or participations in LC Disbursements or Swingline Loans that would result in such Lender receiving payment of a greater proportion of the aggregate amount of its Revolving Loans and participations in LC Disbursements and
Swingline Loans and accrued interest thereon than the proportion received by any other Lender, then the Lender receiving such greater proportion shall purchase (for cash at face value) participations in the Revolving Loans and participations in LC
Disbursements or Swingline Loans of other Lenders to the extent necessary so that the benefit of all such payments shall be shared by the Lenders ratably in accordance with the aggregate amount of principal of and accrued interest on their
respective Revolving Loans and participations in LC Disbursements or Swingline Loans; provided, that (i) if any such participations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations
shall be rescinded and the purchase price restored to the extent of such recovery, without interest, and (ii) the provisions of this paragraph shall not be construed to apply to any payment made by the Borrower pursuant to and in accordance with the
express terms of this Agreement or any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Loans or participations in LC Disbursements or Swingline Loans to any assignee or participant, other
than to the Borrower or any Subsidiary or Affiliate thereof (as to which the provisions of this paragraph shall apply). The Borrower consents to the foregoing and agrees, to the extent it may effectively do so under applicable law, that any Lender
acquiring a participation pursuant to the foregoing arrangements may exercise against the Borrower rights of set-off and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of the Borrower in the amount
of such participation. 
  

 32 

 (d) Unless the Administrative Agent shall have received notice from the Borrower prior to the date on
which any payment is due to the Administrative Agent for the account of the Lenders or the Issuing Bank hereunder that the Borrower will not make such payment, the Administrative Agent may assume that the Borrower has made such payment on such date
in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders or the Issuing Bank, the amount or amounts due. In such event, if the Borrower has not in fact made such payment, then each of the Lenders or Issuing Bank,
as the case may be, severally agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such Lender or Issuing Bank with interest thereon, for each day from and including the date such amount is distributed to it
to but excluding the date of payment to the Administrative Agent, at the greater of the Federal Funds Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation. 
  
 (e) If any Lender shall fail to make any payment required to be made by it
pursuant to Section 2.5(b), 2.20(c) or (d), 10.3(d), then the Administrative Agent may, in its discretion (notwithstanding any contrary provision hereof), apply any amounts thereafter received by the Administrative
Agent for the account of such Lender to satisfy such Lender’s obligations under such Sections until all such unsatisfied obligations are fully paid. 
  
 Section 2.21. Mitigation of Obligations. If any Lender requests compensation under Section 2.17, or if the Borrower is required to
pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.19, then such Lender shall use reasonable efforts to designate a different lending office for funding or booking its
Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the sole judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable under
Section 2.17 or Section 2.19, as the case may be, in the future and (ii) would not subject such Lender to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender. The Borrower hereby agrees to pay all
costs and expenses incurred by any Lender in connection with such designation or assignment. 
  
 Section 2.22. Replacement of Lenders. If any Lender requests compensation under Section 2.17, or if the Borrower is required to pay any additional amount to any Lender or any Governmental
Authority of the account of any Lender pursuant to Section 2.19, or if any Lender defaults in its obligation to fund Loans hereunder, then the Borrower may, at its sole expense and effort, upon notice to such Lender and the Administrative
Agent, require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions set forth in Section 10.4(b) all its interests, rights and obligations under this Agreement to an assignee that shall
assume such obligations (which assignee may be another Lender); provided, that (i) the Borrower shall have received the prior written consent of the Administrative Agent, which consent shall not be unreasonably withheld, (ii) such Lender
shall have received payment of an amount equal to the outstanding principal amount of all Loans owed to it, accrued interest thereon, accrued fees and all other amounts payable to it hereunder, from the assignee (in the case of such outstanding
principal and accrued interest) and from the Borrower (in the case of all other amounts) and (iii) in the case of a claim for compensation under Section 2.17 or payments required to be made pursuant to Section 2.19, such assignment

  

 33 

 
will result in a reduction in such compensation or payments. A Lender shall not be required to make any such assignment and delegation if, prior thereto, as
a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrower to require such assignment and delegation cease to apply. 
  
 Section 2.23. Letters of Credit. 
  
 (a) During the Availability Period, the Issuing Bank, in reliance upon the agreements of the other Lenders pursuant to Section 2.23(d), agrees to
issue, at the request of the Borrower, Letters of Credit for the account of the Borrower on the terms and conditions hereinafter set forth; provided, that (i) each Letter of Credit shall expire on the earlier of (A) the date one year after
the date of issuance of such Letter of Credit (or in the case of any renewal or extension thereof, one year after such renewal or extension) and (B) the date that is five (5) Business Days prior to the Commitment Termination Date; (ii) each Letter
of Credit shall be in a stated amount of at least $100,000; and (iii) the Borrower may not request any Letter of Credit, if, after giving effect to such issuance (A) the aggregate LC Exposure would exceed the LC Commitment or (B) the aggregate LC
Exposure, plus the aggregate outstanding Revolving Loans of all Lenders, would exceed the Aggregate Revolving Commitments. Upon the issuance of each Letter of Credit each Lender shall be deemed to, and hereby irrevocably and
unconditionally agrees to, purchase from the Issuing Bank without recourse a participation in such Letter of Credit equal to such Lender’s Pro Rata Share of the aggregate amount available to be drawn under such Letter of Credit. Each issuance
of a Letter of Credit shall be deemed to utilize the Revolving Commitment of each Lender by an amount equal to the amount of such participation. 
  
 (b) To request the issuance of a Letter of Credit (or any amendment, renewal or extension of an outstanding Letter of Credit), the Borrower shall give the
Issuing Bank and the Administrative Agent irrevocable written notice at least three (3) Business Days prior to the requested date of such issuance specifying the date (which shall be a Business Day) such Letter of Credit is to be issued (or amended,
extended or renewed, as the case may be), the expiration date of such Letter of Credit, the amount of such Letter of Credit, the name and address of the beneficiary thereof and such other information as shall be necessary to prepare, amend, renew or
extend such Letter of Credit. In addition to the satisfaction of the conditions in Article III, the issuance of such Letter of Credit (or any amendment which increases the amount of such Letter of Credit) will be subject to the further conditions
that such Letter of Credit shall be in such form and contain such terms as the Issuing Bank shall approve and that the Borrower shall have executed and delivered any additional applications, agreements and instruments relating to such Letter of
Credit as the Issuing Bank shall reasonably require; provided, that in the event of any conflict between such applications, agreements or instruments and this Agreement, the terms of this Agreement shall control. 
  
 (c) At least two (2) Business Days prior to the issuance of any Letter of
Credit, the Issuing Bank will confirm with the Administrative Agent (by telephone or in writing) that the Administrative Agent has received such notice and if not, the Issuing Bank will provide the Administrative Agent with a copy thereof. Unless
the Issuing Bank has received notice from the Administrative Agent on or before the Business Day immediately preceding the date the Issuing Bank is to issue the requested Letter of Credit (1) directing the Issuing Bank not to issue 

  

 34 

 
the Letter of Credit because such issuance is not then permitted hereunder because of the limitations set forth in Section 2.23(a) or that one or more
conditions specified in Article III are not then satisfied, then, subject to the terms and conditions hereof, the Issuing Bank shall, on the requested date, issue such Letter of Credit in accordance with the Issuing Bank’s usual and customary
business practices. 
  
 (d) The Issuing Bank shall examine all
documents purporting to represent a demand for payment under a Letter of Credit promptly following its receipt thereof. The Issuing Bank shall notify the Borrower and the Administrative Agent of such demand for payment and whether the Issuing Bank
has made or will make a LC Disbursement thereunder; provided, that any failure to give or delay in giving such notice shall not relieve the Borrower of its obligation to reimburse the Issuing Bank and the Lenders with respect to such LC
Disbursement. The Borrower shall be irrevocably and unconditionally obligated to reimburse the Issuing Bank for any LC Disbursements paid by the Issuing Bank in respect of such drawing, without presentment, demand or other formalities of any kind.
Unless the Borrower shall have notified the Issuing Bank and the Administrative Agent prior to 11:00 a.m. on the Business Day immediately prior to the date on which such drawing is honored that the Borrower intends to reimburse the Issuing Bank for
the amount of such drawing in funds other than from the proceeds of Revolving Loans, the Borrower shall be deemed to have timely given a Notice of Revolving Borrowing to the Administrative Agent requesting the Lenders to make a Base Rate Borrowing
on the date on which such drawing is honored in an exact amount due to the Issuing Bank; provided, that for purposes solely of such Borrowing, the conditions precedents set forth in Section 3.2 hereof shall not be applicable. The
Administrative Agent shall notify the Lenders of such Borrowing in accordance with Section 2.3, and each Lender shall make the proceeds of its Base Rate Loan included in such Borrowing available to the Administrative Agent for the account of
the Issuing Bank in accordance with Section 2.6. The proceeds of such Borrowing shall be applied directly by the Administrative Agent to reimburse the Issuing Bank for such LC Disbursement. 
  
 (e) If for any reason a Base Rate Borrowing may not be (as determined in the
sole discretion of the Administrative Agent), or is not, made in accordance with the foregoing provisions, then each Lender (other than the Issuing Bank) shall be obligated to fund the participation that such Lender purchased pursuant to subsection
(a) in an amount equal to its Pro Rata Share of such LC Disbursement on and as of the date which such Base Rate Borrowing should have occurred. Each Lender’s obligation to fund its participation shall be absolute and unconditional and shall not
be affected by any circumstance, including without limitation (i) any setoff, counterclaim, recoupment, defense or other right that such Lender or any other Person may have against the Issuing Bank or any other Person for any reason whatsoever, (ii)
the existence of a Default or an Event of Default or the termination of the Aggregate Revolving Commitments, (iii) any adverse change in the condition (financial or otherwise) of the Borrower or any of its Subsidiaries, (iv) any breach of this
Agreement by the Borrower or any other Lender, (v) any amendment, renewal or extension of any Letter of Credit or (vi) any other circumstance, happening or event whatsoever, whether or not similar to any of the foregoing. On the date that such
participation is required to be funded, each Lender shall promptly transfer, in immediately available funds, the amount of its participation to the Administrative Agent for the account of the Issuing Bank. Whenever, at any time after the Issuing
Bank has received from any 

  

 35 

 
such Lender the funds for its participation in a LC Disbursement, the Issuing Bank (or the Administrative Agent on its behalf) receives any payment on
account thereof, the Administrative Agent or the Issuing Bank, as the case may be, will distribute to such Lender its Pro Rata Share of such payment; provided, that if such payment is required to be returned for any reason to the Borrower or
to a trustee, receiver, liquidator, custodian or similar official in any bankruptcy proceeding, such Lender will return to the Administrative Agent or the Issuing Bank any portion thereof previously distributed by the Administrative Agent or the
Issuing Bank to it. 
  
 (f) To the extent that any Lender shall
fail to pay any amount required to be paid pursuant to paragraph (d) of this Section 2.23 on the due date therefor, such Lender shall pay interest to the Issuing Bank (through the Administrative Agent) on such amount from such due date to the
date such payment is made at a rate per annum equal to the Federal Funds Rate; provided, that if such Lender shall fail to make such payment to the Issuing Bank within three (3) Business Days of such due date, then, retroactively to the due
date, such Lender shall be obligated to pay interest on such amount at the Default Rate. 
  
 (g) If any Event of Default shall occur and be continuing, on the Business Day that the Borrower receives notice from the Administrative Agent or the Required Lenders demanding the deposit of cash collateral pursuant
to this paragraph, the Borrower shall deposit in an account with the Administrative Agent, in the name of the Administrative Agent and for the benefit of the Lenders, an amount in cash equal to the LC Exposure as of such date plus any accrued and
unpaid interest thereon; provided, that the obligation to deposit such cash collateral shall become effective immediately, and such deposit shall become immediately due and payable, with demand or notice of any kind, upon the occurrence of
any Event of Default with respect to the Borrower described in clause (g) or (h) of Section 8.1. Such deposit shall be held by the Administrative Agent as collateral for the payment and performance of the obligations of the Borrower under
this Agreement. The Administrative Agent shall have exclusive dominion and control, including the exclusive right of withdrawal, over such account. Other than any interest earned on the investment of such deposits, which investments shall be made at
the option and sole discretion of the Administrative Agent and at the Borrower’s risk and expense, such deposits shall not bear interest. Interest and profits, if any, on such investments shall accumulate in such account. Moneys in such account
shall applied by the Administrative Agent to reimburse the Issuing Bank for LC Disbursements for which it had not been reimbursed and to the extent so applied, shall be held for the satisfaction of the reimbursement obligations of the Borrower for
the LC Exposure at such time or, if the maturity of the Loans has been accelerated, with the consent of the Required Lenders, be applied to satisfy other obligations of the Borrower under this Agreement. If the Borrower is required to provide an
amount of cash collateral hereunder as a result of the occurrence of an Event of Default, such amount (to the extent not so applied as aforesaid) shall be returned to the Borrower with three Business Days after all Events of Default have been cured
or waived. 
  
 (h) Promptly following the end of each fiscal
quarter, the Issuing Bank shall deliver (through the Administrative Agent) to each Lender and the Borrower a report describing the aggregate Letters of Credit outstanding at the end of such fiscal quarter. Upon the request of any Lender from time to
time, the Issuing Bank shall deliver to such Lender any other 

  

 36 

 
information reasonably requested by such Lender with respect to each Letter of Credit then outstanding. 
  
 (i) The Borrower’s obligation to reimburse LC Disbursements hereunder
shall be absolute, unconditional and irrevocable and shall be performed strictly in accordance with the terms of this Agreement under all circumstances whatsoever and irrespective of any of the following circumstances: 
  
 (i) Any lack of validity or enforceability of any Letter of
Credit or this Agreement; 
  
 (ii) The existence
of any claim, set-off, defense or other right which the Borrower or any Subsidiary or Affiliate of the Borrower may have at any time against a beneficiary or any transferee of any Letter of Credit (or any Persons or entities for whom any such
beneficiary or transferee may be acting), any Lender (including the Issuing Bank) or any other Person, whether in connection with this Agreement or the Letter of Credit or any document related hereto or thereto or any unrelated transaction;

  
 (iii) Any draft or other document presented
under a Letter of Credit proving to be forged, fraudulent or invalid in any respect or any statement therein being untrue or inaccurate in any respect; 
  
 (iv) Payment by the Issuing Bank under a Letter of Credit against presentation of a draft or other document to the Issuing Bank that does
not comply with the terms of such Letter of Credit; 
  
 (v) Any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of, or provide a right of setoff against, the
Borrower’s obligations hereunder; or 
  
 (vi) The existence of a Default or an Event of Default. 
  
 Neither the Administrative Agent, the Issuing Bank, the Lenders nor any Related Party of any of the foregoing shall have any liability or responsibility by reason of or in connection with the issuance or transfer of any Letter of Credit or
any payment or failure to make any payment thereunder (irrespective of any of the circumstances referred to above), or any error, omission, interruption, loss or delay in transmission or delivery of any draft, notice or other communication under or
relating to any Letter of Credit (including any document required to make a drawing thereunder), any error in interpretation of technical terms or any consequence arising from causes beyond the control of the Issuing Bank; provided, that the
foregoing shall not be construed to excuse the Issuing Bank from liability to the Borrower to the extent of any direct damages (as opposed to consequential damages, claims in respect of which are hereby waived by the Borrower to the extent permitted
by applicable law) suffered by the Borrower that 

  

 37 

 
are caused by the Issuing Bank’s failure to exercise care when determining whether drafts or other documents presented under a Letter of Credit comply
with the terms thereof. The parties hereto expressly agree, that in the absence of gross negligence or willful misconduct on the part of the Issuing Bank (as finally determined by a court of competent jurisdiction), the Issuing Bank shall be deemed
to have exercised care in each such determination. In furtherance of the foregoing and without limiting the generality thereof, the parties agree that, with respect to documents presented that appear on their face to be in substantial compliance
with the terms of a Letter of Credit, the Issuing Bank may, in its sole discretion, either accept and make payment upon such documents without responsibility for further investigation, regardless of any notice or information to the contrary, or
refuse to accept and make payment upon such documents if such documents are not in strict compliance with the terms of such Letter of Credit. 
  
 (j) Unless otherwise expressly agreed by the Issuing Bank and the Borrower when a Letter of Credit is issued and subject to applicable laws, performance
under Letters of Credit by the Issuing Bank, its correspondents, and the beneficiaries thereof will be governed by the rules of the “International Standby Practices 1998” (ISP98) (or such later revision as may be published by the Institute
of International Banking Law & Practice on any date any Letter of Credit may be issued) and to the extent not inconsistent therewith, the governing law of this Agreement set forth in Section 10.5. 
  
 ARTICLE III 
  
 CONDITIONS PRECEDENT TO LOANS AND LETTERS OF CREDIT 

 
 Section 3.1. Conditions To Effectiveness. The obligations of
the Lenders (including the Swingline Lender) to make Loans and the obligation of the Issuing Bank to issue any Letter of Credit hereunder shall not become effective until the date on which each of the following conditions is satisfied (or waived in
accordance with Section 10.2). 
  
 (a) The Administrative
Agent shall have received all fees and other amounts due and payable on or prior to the Closing Date, including reimbursement or payment of all out-of-pocket expenses (including reasonable fees, charges and disbursements of counsel to the
Administrative Agent) required to be reimbursed or paid by the Borrower hereunder, under any other Loan Document and under any agreement with the Administrative Agent or SunTrust Equitable Securities Corporation, as Arranger. 
  
 (b) The Administrative Agent (or its counsel) shall have received the
following: 
  
 (i) a counterpart of this
Agreement signed by or on behalf of each party thereto or written evidence satisfactory to the Administrative Agent (which may include telecopy transmission of a signed signature page of this Agreement) that such party has signed a counterpart of
this Agreement; 
  

 38 

 (ii) if requested by any Lender, duly executed Notes payable to such Lender; 

 
 (iii) a duly executed Subsidiary Guaranty Agreement and
Indemnity and Contribution Agreement; 
  
 (iv)
evidence of the refinancing and termination of the Prior Credit Facility, in form and substance satisfactory to Administrative Agent; 
  
 (v) a certificate of the Secretary or Assistant Secretary of each Loan Party, attaching and certifying copies of its bylaws and of the
resolutions of its boards of directors, authorizing the execution, delivery and performance of the Loan Documents to which it is a party and certifying the name, title and true signature of each officer of such Loan Party executing the Loan
Documents to which it is a party; 
  
 (vi)
certified copies of the articles of incorporation or other charter documents of each Loan Party, together with certificates of good standing or existence, as may be available from the Secretary of State of the jurisdiction of incorporation of such
Loan Party and each other jurisdiction where such Loan Party is required to be qualified to do business as a foreign corporation; 
  
 (vii) a favorable written opinion of W. Bayless Rowe, Vice President, General Counsel and Secretary of the Borrower, addressed to the
Administrative Agent and each of the Lenders, and covering such matters relating to the Loan Parties, the Loan Documents and the transactions contemplated therein as the Administrative Agent or the Required Lenders shall reasonably request;

  
 (viii) a certificate, dated the Closing Date
and signed by a Responsible Officer, confirming compliance with the conditions set forth in paragraphs (a), (b) and (c) of Section 3.2 including a representation that no event or condition has occurred since the last audited financial
statements which would have a Material Adverse Effect; 
  
 (ix) a duly executed Notice of Borrowing, if applicable; 
  
 (x) a duly executed funds disbursement agreement; 
  
 (xi) certified copies of all consents, approvals, authorizations, registrations and filings and orders required or advisable to be made or
obtained under any Requirement of Law, or by any contractual obligation of each Loan Party, in connection with the execution, delivery, performance, validity and enforceability of the Loan Documents or any of the transactions contemplated thereby,
and such consents, approvals, authorizations, registrations, filings and orders shall be in full force and effect and all applicable waiting periods shall have expired; and 
  
 (xii) copies of the consolidated financial statements of the Borrower and its subsidiaries for the fiscal
years ended 2000, 2001, and 2002, including balance sheets, income and cash flow statements audited by independent public accountants of recognized national standing and prepared in conformity with GAAP, and the 

  

 39 

 
consolidated financial statements of Borrower and its subsidiaries for the fiscal quarter ending June 30, 2003, and such other financial information as the
Administrative Agent may reasonably request; 
  
 (xiii) a copy of the Del-Tin Agreements; and 
  
 (xiv) certificates of insurance issued on behalf of insurers of the Borrower and all guarantors, describing in reasonable detail the types and amounts of insurance (property and liability) maintained by the Borrower and all guarantors,
naming the Administrative Agent as additional insured and loss payee, as appropriate. 
  
 Section 3.2. Each Credit Event. The obligation of each Lender to make a Loan on the occasion of any Borrowing and of the Issuing Bank to issue, amend, renew or extend any Letter of Credit is
subject to the satisfaction of the following conditions: 
  
 (a)
at the time of and immediately after giving effect to such Borrowing or the issuance, amendment, renewal or extension of such Letter of Credit, as applicable, no Default or Event of Default shall exist; and 
  
 (b) all representations and warranties of each Loan Party set forth in the
Loan Documents shall be true and correct in all material respects on and as of the date of such Borrowing or the date of issuance, amendment, extension or renewal of such Letter of Credit, in each case before and after giving effect thereto;

  
 (c) since the date of the audited financial statements of the
Borrower described in Section 4.4, there shall have been no change which has had or could reasonably be expected to have a Material Adverse Effect; and 
  

(d) the Administrative Agent shall have received such other documents, certificates, information or legal opinions as the Administrative Agent or the
Required Lenders may reasonably request, all in form and substance reasonably satisfactory to the Administrative Agent or the Required Lenders. 
  
 Each Borrowing and each issuance, amendment, extension or renewal of any Letter of Credit shall be deemed to constitute a representation and warranty by
the Borrower on the date thereof as to the matters specified in paragraphs (a), (b) and (c) of this Section 3.2. 
  
 Section 3.3. Delivery of Documents. All of the Loan Documents, certificates, legal opinions and other documents and papers referred to in
this Article III, unless otherwise specified, shall be delivered to the Administrative Agent for the account of each of the Lenders and, except for the Notes, in sufficient counterparts or copies for each of the Lenders and shall be in form and
substance satisfactory in all respects to the Administrative Agent. 
  

 40 

 ARTICLE IV 
  

REPRESENTATIONS AND WARRANTIES 
  
 The Borrower represents and warrants to the Administrative Agent and each Lender as follows: 
  
 Section 4.1. Existence; Power. The Borrower and each of its Subsidiaries (i) is duly organized, validly
existing and in good standing as a corporation under the laws of the jurisdiction of its organization, (ii) has all requisite power and authority to carry on its business as now conducted, and (iii) is duly qualified to do business, and is in good
standing, in each jurisdiction where such qualification is required, except where a failure to be so qualified could not reasonably be expected to result in a Material Adverse Effect. 
  
 Section 4.2. Organizational Power; Authorization. The execution, delivery and performance by each Loan Party
of the Loan Documents to which it is a party are within such Loan Party’s organizational powers and have been duly authorized by all necessary organizational, and if required, stockholder, action. This Agreement has been duly executed and
delivered by the Borrower, and constitutes, and each other Loan Document to which any Loan Party is a party, when executed and delivered by such Loan Party, will constitute, valid and binding obligations of the Borrower or such Loan Party (as the
case may be), enforceable against it in accordance with their respective terms, except as may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, or similar laws affecting the enforcement of creditors’ rights generally
and by general principles of equity. 
  
 Section 4.3.
Governmental Approvals; No Conflicts. The execution, delivery and performance by the Borrower of this Agreement, and by each Loan Party of the other Loan Documents to which it is a party (a) do not require any consent or approval of,
registration or filing with, or any action by, any Governmental Authority, except those as have been obtained or made and are in full force and effect, (b) will not violate any applicable law or regulation or the charter, by-laws or other
organizational documents of the Borrower or any of its Subsidiaries or any judgment or order of any Governmental Authority, (c) will not violate or result in a default under any indenture, material agreement or other material instrument binding on
the Borrower or any of its Subsidiaries or any of its assets or give rise to a right thereunder to require any payment to be made by the Borrower or any of its Subsidiaries and (d) will not result in the creation or imposition of any Lien on any
asset of the Borrower or any of its Subsidiaries. 
  
 Section
4.4. Financial Statements. The Borrower has furnished to each Lender (i) the audited consolidated balance sheet of the Borrower and its Subsidiaries as of December 31, 2002 and the related consolidated statements of income,
shareholders’ equity and cash flows for the fiscal year then ended reported on by KPMG, LLP and (ii) the unaudited consolidated balance sheet of the Borrower and its Subsidiaries as at the end of [June 30, 2003], and the related unaudited
consolidated statements of income and cash flows for the fiscal quarter and year-to-date period then ending, certified by a Responsible Officer. Such financial statements fairly present the consolidated financial condition of the Borrower and its
Subsidiaries as of such dates and the consolidated results of operations for such periods in conformity with 

  

 41 

 
GAAP consistently applied, subject to year end audit adjustments and the absence of footnotes in the case of the statements referred to in clause (ii). Since
December 31, 2002, there have been no changes with respect to the Borrower and its Subsidiaries which have had or could reasonably be expected to have, singly or in the aggregate, a Material Adverse Effect. 
  
 Section 4.5. Litigation and Environmental Matters. 

 
 (a) No litigation, investigation or proceeding of or before any
arbitrators or Governmental Authorities is pending against or, to the knowledge of the Borrower, threatened against or affecting the Borrower or any of its Subsidiaries (i) as to which there is a reasonable possibility of an adverse determination
that could reasonably be expected to have, either individually or in the aggregate, a Material Adverse Effect or (ii) which in any manner draws into question the validity or enforceability of this Agreement or any other Loan Document. 
  
 (b) Neither the Borrower nor any of its Subsidiaries (i) has failed to comply
with any Environmental Law or to obtain, maintain or comply with any permit, license or other approval required under any Environmental Law, (ii) has become subject to any Environmental Liability, (iii) has received notice of any claim with respect
to any Environmental Liability or (iv) knows of any basis for any Environmental Liability, in each case which could reasonably be expected to have a Material Adverse Effect. 
  
 Section 4.6. Compliance with Laws and Agreements. The Borrower and each Subsidiary is in compliance with (a)
all applicable laws, rules, regulations and orders of any Governmental Authority, and (b) all indentures, agreements or other instruments binding upon it or its properties, except where non-compliance, either singly or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect. 
  
 Section 4.7. Investment Company Act, Etc. Neither the Borrower nor any of its Subsidiaries is (a) an “investment company,” as defined in, or subject to regulation under, the Investment Company Act of 1940, as
amended, (b) a “holding company” as defined in, or subject to regulation under, the Public Utility Holding Company Act of 1935, as amended or (c) otherwise subject to any other regulatory scheme limiting its ability to incur debt.

  
 Section 4.8. Taxes. The Borrower and its
Subsidiaries and each other Person for whose taxes the Borrower or any Subsidiary could become liable have timely filed or caused to be filed all Federal income tax returns and all other material tax returns that are required to be filed by them,
and have paid all taxes shown to be due and payable on such returns or on any assessments made against it or its property and all other taxes, fees or other charges imposed on it or any of its property by any Governmental Authority, except (i) to
the extent the failure to do so would not have a Material Adverse Effect or (ii) where the same are currently being contested in good faith by appropriate proceedings and for which the Borrower or such Subsidiary, as the case may be, has set aside
on its books adequate reserves. The charges, accruals and reserves on the books of the Borrower and its Subsidiaries in respect of such taxes are adequate, and no tax liabilities that could be materially in excess of the amount so provided are
anticipated. 
  

 42 

 Section 4.9. Margin Regulations. None of the proceeds of any of the Loans or Letters
of Credit will be used for “purchasing” or “carrying” any “margin stock” with the respective meanings of each of such terms under Regulation U as now and from time to time hereafter in effect or for any purpose that
violates the provisions of the applicable Margin Regulations. 
  
 Section 4.10. ERISA. No ERISA Event has occurred or is reasonably expected to occur that, when taken together with all other such ERISA Events for which liability is reasonably expected to occur, could reasonably be
expected to result in a Material Adverse Effect. The present value of all accumulated benefit obligations under each Plan (based on the assumptions used for purposes of Statement of Financial Standards No. 87) did not, as of the date of the most
recent financial statements reflecting such amounts, exceed by more than $100,000 the fair market value of the assets of such Plan, and the present value of all accumulated benefit obligations of all underfunded Plans (based on the assumptions used
for purposes of Statement of Financial Standards No. 87) did not, as of the date of the most recent financial statements reflecting such amounts, exceed by more than $100,000 the fair market value of the assets of all such underfunded Plans.

  
 Section 4.11. Ownership of Property. 

 
 (a) Each of the Borrower and its Subsidiaries has good title to, or valid
leasehold interests in, all of its real and personal property material to the operation of its business. 
  
 (b) Each of the Borrower and its Subsidiaries owns, or is licensed, or otherwise has the right, to use, all patents, trademarks, service marks,
tradenames, copyrights and other intellectual property material to its business, and the use thereof by the Borrower and its Subsidiaries does not infringe on the rights of any other Person, except for any such infringements that, individually or in
the aggregate, would not have a Material Adverse Effect. 
  
 Section 4.12. Disclosure. The Borrower has disclosed to the Lenders all agreements, instruments, and corporate or other restrictions to which the Borrower or any of its Subsidiaries is subject, and all other matters
known to any of them, that, individually or in the aggregate, could reasonably be expected to result in a Material Adverse Effect. None of the reports (including without limitation all reports that the Borrower is required to file with the
Securities and Exchange Commission), financial statements, certificates or other information furnished by or on behalf of the Borrower to the Administrative Agent or any Lender in connection with the negotiation or syndication of this Agreement or
any other Loan Document or delivered hereunder or thereunder (as modified or supplemented by any other information so furnished) contains any material misstatement of fact or omits to state any material fact necessary to make the statements therein,
taken as a whole, in light of the circumstances under which they were made, not misleading; 
  
 Section 4.13. Labor Relations. There are no strikes, lockouts or other material labor disputes or grievances against the Borrower or any of its Subsidiaries, or, to the Borrower’s knowledge,
threatened against or affecting the Borrower or any of its Subsidiaries, 

  

 43 

 
and no significant unfair labor practice, charges or grievances are pending against the Borrower or any of its Subsidiaries, or to the Borrower’s
knowledge, threatened against any of them before any Governmental Authority, which could reasonably be expected to have a Material Adverse Effect. All payments due from the Borrower or any of its Subsidiaries pursuant to the provisions of any
collective bargaining agreement have been paid or accrued as a liability on the books of the Borrower or any such Subsidiary, except where the failure to do so could not reasonably be expected to have a Material Adverse Effect. 
  
 Section 4.14. Subsidiaries. Schedule 4.14 sets
forth the name of, the ownership interest of the Borrower in, the jurisdiction of incorporation of, and the type of, each Subsidiary as of the Closing Date. 
  
 ARTICLE V 
  
 AFFIRMATIVE COVENANTS 
  
 The Borrower covenants and agrees that so long as any Lender has a Commitment hereunder or the principal of and interest on any Loan or any fee or any LC Disbursements remains unpaid or any Letter of Credit remains
unpaid: 
  
 Section 5.1. Financial Statements and Other
Information. The Borrower will deliver to the Administrative Agent and each Lender: 
  
 (a) as soon as available and in any event within 90 days after the end of each fiscal year of Borrower, a copy of the annual audited report for such fiscal year for the Borrower and its Subsidiaries, containing a
consolidated balance sheet of the Borrower and its Subsidiaries as of the end of such fiscal year and the related consolidated statements of income, stockholders’ equity and cash flows (together with all footnotes thereto) of the Borrower and
its Subsidiaries for such fiscal year, setting forth in each case in comparative form the figures for the previous fiscal year, all in reasonable detail and reported on by KPMG, LLP or other independent public accountants of nationally recognized
standing (without a “going concern” or like qualification, exception or explanation and without any qualification or exception as to scope of such audit) to the effect that such financial statements present fairly in all material respects
the financial condition and the results of operations of the Borrower and its Subsidiaries for such fiscal year on a consolidated and consolidating basis in accordance with GAAP and that the examination by such accountants in connection with such
consolidated financial statements has been made in accordance with generally accepted auditing standards; 
  
 (b) as soon as available and in any event within 45 days after the end of each of the first three fiscal quarters of each fiscal year of the Borrower, an
unaudited consolidated balance sheet of the Borrower and its Subsidiaries as of the end of such fiscal quarter and the related unaudited consolidated statements of income and cash flows of the Borrower and its Subsidiaries for such fiscal quarter
and the then elapsed portion of such fiscal year, setting forth in each case in comparative form the figures for the corresponding quarter and the corresponding portion of Borrower’s previous fiscal year, all certified by the chief financial
officer or treasurer of the Borrower as presenting fairly in all material respects the financial condition and results of 

  

 44 

 
operations of the Borrower and its Subsidiaries on a consolidated basis in accordance with GAAP, subject to normal year-end audit adjustments and the absence
of footnotes; 
  
 (c) concurrently with the delivery of the
financial statements referred to in clauses (a) and (b) above, a certificate of a Responsible Officer, (i) certifying as to whether there exists a Default or Event of Default on the date of such certificate, and if a Default or an Event of Default
then exists, specifying the details thereof and the action which the Borrower has taken or proposes to take with respect thereto, (ii) setting forth in reasonable detail calculations demonstrating compliance with Article VI, (iii) setting forth in
reasonable detail the calculation of Total Debt to EBITDA Ratio and (iv) stating whether any change in GAAP or the application thereof has occurred since the date of the Borrower’s audited financial statements referred to in Section 4.4
and, if any change has occurred, specifying the effect of such change on the financial statements accompanying such certificate; 
  
 (d) promptly after the same become publicly available, copies of all periodic and other reports, proxy statements and other materials filed with the
Securities and Exchange Commission, or any Governmental Authority succeeding to any or all functions of said Commission, or with any national securities exchange, or distributed by the Borrower to its shareholders generally, as the case may be;

  
 (e) promptly upon the consummation of any offering of common
or preferred stock of the Borrower, notice thereof and the aggregate amount of proceeds raised therefrom. 
  
 (f) promptly following any request therefor, such other information regarding the results of operations, business affairs and financial condition of the
Borrower or any Subsidiary as the Administrative Agent or any Lender may reasonably request. 
  
 Section 5.2. Notices of Material Events. The Borrower will furnish to the Administrative Agent and each Lender prompt written notice of the following: 
  
 (a) the occurrence of any Default or Event of Default; 
  
 (b) the filing or commencement of any action, suit or proceeding by or before
any arbitrator or Governmental Authority against or, to the knowledge of the Borrower, affecting the Borrower or any Subsidiary which, if adversely determined, could reasonably be expected to result in a Material Adverse Effect; 
  
 (c) the occurrence of any event or any other development by which the
Borrower or any of its Subsidiaries (i) fails to comply with any Environmental Law or to obtain, maintain or comply with any permit, license or other approval required under any Environmental Law, (ii) becomes subject to any Environmental Liability,
(iii) receives notice of any claim with respect to any Environmental Liability, or (iv) becomes aware of any basis for any Environmental Liability and in each of the preceding clauses, which individually or in the aggregate, could reasonably be
expected to result in a Material Adverse Effect; 
  

 45 

 (d) the occurrence of any ERISA Event that alone, or together with any other ERISA Events that have
occurred, could reasonably be expected to result in liability of the Borrower and its Subsidiaries in an aggregate amount exceeding $5,000,000; and 
  
 (e) any other development that results in, or could reasonably be expected to result in, a Material Adverse Effect. 
  
 (f) Each notice delivered under this Section shall be accompanied by a
written statement of a Responsible Officer setting forth the details of the event or development requiring such notice and any action taken or proposed to be taken with respect thereto. 
  
 Section 5.3. Existence; Conduct of Business. The Borrower will, and will cause each of its Subsidiaries to, do
or cause to be done all things necessary to preserve, renew and maintain in full force and effect its legal existence and its respective rights, licenses, permits, privileges, franchises, patents, copyrights, trademarks and trade names material to
the conduct of its business; provided, that nothing in this Section shall prohibit any merger, consolidation, liquidation or dissolution permitted under Section 7.3. 
  
 Section 5.4. Compliance with Laws, Etc. The Borrower will, and will cause each of its Subsidiaries to, comply
with all laws, rules, regulations and requirements of any Governmental Authority applicable to its properties, except where the failure to do so, either individually or in the aggregate, could not reasonably be expected to result in a Material
Adverse Effect. 
  
 Section 5.5. Payment of
Obligations. The Borrower will, and will cause each of its Subsidiaries to, pay and discharge at or before maturity, all of its obligations and liabilities (including without limitation all tax liabilities and claims that could result in a
statutory Lien) before the same shall become delinquent or in default, except where (a) the validity or amount thereof is being contested in good faith by appropriate proceedings, (b) the Borrower or such Subsidiary has set aside on its books
adequate reserves with respect thereto in accordance with GAAP and (c) the failure to make payment pending such contest could not reasonably be expected to result in a Material Adverse Effect. 
  
 Section 5.6. Books and Records. The Borrower will, and will
cause each of its Subsidiaries to, keep proper books of record and account in which full, true and correct entries shall be made of all dealings and transactions in relation to its business and activities to the extent necessary to prepare the
consolidated financial statements of Borrower in conformity with GAAP. 
  
 Section 5.7. Visitation, Inspection, Appraisals Etc. 
  
 (a) The Borrower will, and will cause each of its Subsidiaries to, permit any representative of the Administrative Agent or any Lender, to visit and inspect its properties, to examine its books and records and to make
copies and take extracts therefrom, and to discuss its affairs, finances and accounts with any of its officers and with its independent certified public accountants, all at such reasonable times and as often as the Administrative Agent or any Lender

  

 46 

 
may reasonably request after reasonable prior notice to the Borrower; provided, however, if an Event of Default has occurred and is continuing, no
prior notice shall be required. 
  
 (b) The Borrower will, and
will cause each of its Subsidiaries to, deliver to the Lenders such appraisals of the timber land of the Loan Parties as the Administrative Agent may reasonably request at any time and from time to time, such appraisals to be conducted by an
appraiser, and in form and substance, reasonably satisfactory to the Administrative Agent conducted at the expense of the Lenders, unless an Event of Default has occurred and is continuing, at which time such appraisals shall be conducted at the
expense of the Borrower as frequently as the Required Lenders shall request. 
  
 Section 5.8. Maintenance of Properties; Insurance. The Borrower will, and will cause each of its Subsidiaries to, (a) keep and maintain all property material to the conduct of its business in good
working order and condition, ordinary wear and tear except where the failure to do so, either individually or it the aggregate, could not reasonably be expected to result in a Material Adverse Effect and (b) maintain with financially sound and
reputable insurance companies, insurance with respect to its properties and business, and the properties and business of its Subsidiaries, against loss or damage of the kinds customarily insured against by companies in the same or similar businesses
operating in the same or similar locations. 
  
 Section 5.9.
Use of Proceeds and Letters of Credit. The Borrower will use the proceeds of all Loans to refinance existing indebtedness on the Closing Date and thereafter to provide for working capital needs and for other general corporate
purposes of the Borrower and its Subsidiaries. No part of the proceeds of any Loan will be used, whether directly or indirectly, for any purpose that would violate any rule or regulation of the Board of Governors of the Federal Reserve System,
including Regulations T, U or X. All Letters of Credit shall be used for general corporate purposes. 
  
 Section 5.10. Additional Subsidiaries. If any additional Subsidiary is acquired or formed after the Closing Date, the Borrower will, within
ten (10) business days after such Subsidiary is acquired or formed, notify the Administrative Agent and the Lenders thereof and will cause such Subsidiary to become a Subsidiary Loan Party by executing agreements in the form of Annex I to the
Subsidiary Guaranty Agreement and Annex I to the Indemnity and Contribution Agreement in form and substance satisfactory to the Administrative Agent and the Required Lenders and will cause such Subsidiary to deliver simultaneously therewith similar
documents applicable to such Subsidiary required under Section 3.1 as reasonably requested by the Administrative Agent. 
  
 ARTICLE VI 
  
 FINANCIAL COVENANTS 
  
 The Borrower covenants and agrees that so long as any Lender has a Commitment hereunder or the principal of or interest on or any Loan remains unpaid or any fee or any LC Disbursement remains unpaid or any Letter of
Credit remains outstanding: 
  
 Section 6.1. Leverage
Ratio. The Borrower and its Subsidiaries shall maintain, as of the last day of each fiscal quarter of the Borrower, commencing on the fiscal quarter ending on September 30, 2003, a Leverage Ratio of not greater than 0.60:1.0. 
  

 47 

 Section 6.2. Interest Coverage Ratio. The Borrower and its Subsidiaries shall maintain, as
of last day of each fiscal quarter of the Borrower, commencing with the fiscal quarter ending September 30, 2003, an Interest Coverage Ratio of not less than 5.0:1.0. 
  
 Section 6.3. Fixed Charge Coverage Ratio. The Borrower and its Subsidiaries shall maintain, as of last day of
each fiscal quarter of the Borrower, commencing with the fiscal quarter ending September 30, 2003, a Fixed Charge Coverage Ratio of not less than 2.5:1.0. 
  
 Section 6.4. Consolidated Net Worth The Borrower will not permit its Consolidated Net Worth at any time to be less than an amount equal to
the sum of (i) $155,000,000 as of June 30, 2003, plus (ii) 50% of Consolidated Net Income accrued during each fiscal quarter ending thereafter, commencing with the fiscal quarter ending September 30, 2003, provided, that if
Consolidated Net Income is negative in any fiscal quarter the amount added for such fiscal quarter shall be zero and such negative Consolidated Net Income shall not reduce the amount of Consolidated Net Income added from any previous fiscal quarter,
plus (iii) 100% of the net proceeds from any public or private offering of common or preferred stock of the Borrower issued after the Closing Date. 
  
 Section 6.5. Minimum Timber Market Value. The Borrower and its Subsidiaries shall maintain, as of the last day of each fiscal quarter of the
Borrower, commencing with the fiscal quarter ending September 30, 2003, a Timber Market Value greater than 200% of Total Senior Indebtedness. 
  
 ARTICLE VII 
  
 NEGATIVE COVENANTS 
  
 The Borrower covenants and agrees that so long as any Lender has a Commitment hereunder or the principal of or interest on any Loan remains unpaid or any fee or any LC Disbursement remains unpaid or any Letter of
Credit remains outstanding: 
  
 Section 7.1.
Indebtedness. The Borrower will not, and will not permit any of its Subsidiaries to, create, incur, assume or suffer to exist any Indebtedness, except: 
  
 (a) Indebtedness created pursuant to the Loan Documents (including without limitation Letters of Credit issued pursuant to
Section 2.23); 
  
 (b) Indebtedness existing on the date
hereof and set forth on Schedule 7.1 and extensions, renewals and replacements of any such Indebtedness that do not increase the outstanding principal amount thereof (immediately prior to giving effect to such extension, renewal or
replacement) or shorten the maturity or the weighted average life thereof; 
  

 48 

 (c) Indebtedness of the Borrower or any Subsidiary incurred to finance the acquisition, construction or
improvement of any fixed or capital assets, including Capital Lease Obligations and any Indebtedness assumed in connection with the acquisition of any such assets if secured by a Lien on any such assets prior to the acquisition thereof; provided,
that such Indebtedness is incurred prior to or within 90 days after such acquisition or the completion of such construction or improvements or extensions, renewals, and replacements of any such Indebtedness that do not increase the outstanding
principal amount thereof (immediately prior to giving effect to such extension, renewal or replacement) or shorten the maturity or the weighted average life thereof; provided further, that the aggregate principal amount of such Indebtedness does not
exceed $1,000,000 at any time outstanding; 
  
 (d) Indebtedness of
the Borrower owing to any Subsidiary Loan Party and of any Subsidiary Loan Party owing to the Borrower or any other Subsidiary Loan Party; 
  
 (e) Guarantees by the Borrower of Indebtedness of any Subsidiary Loan Party and by any Subsidiary of Indebtedness of the Borrower or any other Subsidiary
Loan Party; 
  
 (f) Indebtedness of any Person which becomes a
Subsidiary after the date of this Agreement; provided, that such Indebtedness exists at the time that such Person becomes a Subsidiary and is not created in contemplation of or in connection with such Person becoming a Subsidiary and the
aggregate principal amount of such Indebtedness permitted hereunder shall not exceed $5,000,000 outstanding at any time; 
  
 (g) Indebtedness in respect of obligations under Hedging Agreements permitted by Section 7.10; 
  
 (h) Indebtedness incurred under a line of credit with BancorpSouth in an
amount not to exceed $1,000,000; 
  
 (i) Letters of Credit issued
in the ordinary course of business of the Borrower in an aggregate stated amount not to exceed $5,000,000; and 
  
 (j) other unsecured Indebtedness in an aggregate principal amount not to exceed $5,000,000 at any time outstanding. 
  
 Section 7.2. Negative Pledge. The Borrower will not, and will
not permit any of its Subsidiaries to, create, incur, assume or suffer to exist any Lien on any of its assets or property now owned or hereafter acquired or, except: 
  
 (a) Permitted Encumbrances; 
  
 (b) any Liens on any property or asset of the Borrower or any Subsidiary existing on the Closing Date set forth on Schedule 7.2; provided,
that such Lien shall not apply to any other property or asset of the Borrower or any Subsidiary; 
  
 (c) purchase money Liens upon or in any fixed or capital assets to secure the purchase price or the cost of construction or improvement of such fixed or
capital assets or to 

  

 49 

 
secure Indebtedness incurred solely for the purpose of financing the acquisition, construction or improvement of such fixed or capital assets (including
Liens securing any Capital Lease Obligations); provided, that (i) such Lien secures Indebtedness permitted by Section 7.1(c), (ii) such Lien attaches to such asset concurrently or within 90 days after the acquisition, improvement or
completion of the construction thereof; (iii) such Lien does not extend to any other asset; and (iv) the Indebtedness secured thereby does not exceed the cost of acquiring, constructing or improving such fixed or capital assets; 
  
 (d) any Lien (i) existing on any asset of any Person at the time such Person
becomes a Subsidiary of the Borrower, (ii) existing on any asset of any Person at the time such Person is merged with or into the Borrower or any Subsidiary of the Borrower or (iii) existing on any asset prior to the acquisition thereof by the
Borrower or any Subsidiary of the Borrower; provided, that any such Lien was not created in the contemplation of any of the foregoing and any such Lien secures only those obligations which it secures on the date that such Person becomes a
Subsidiary or the date of such merger or the date of such acquisition; and 
  
 (e) extensions, renewals, or replacements of any Lien referred to in paragraphs (a) through (d) of this Section; provided, that the principal amount of the Indebtedness secured thereby is not increased and that
any such extension, renewal or replacement is limited to the assets originally encumbered thereby. 
  
 Section 7.3. Fundamental Changes. 
  
 (a) The Borrower will not, and will not permit any Subsidiary to, merge into or consolidate into any other Person, or permit any other Person to merge
into or consolidate with it or liquidate or dissolve; provided, that if at the time thereof and immediately after giving effect thereto, no Default or Event of Default shall have occurred and be continuing (i) the Borrower or any
Subsidiary may merge with a Person if the Borrower (or such Subsidiary if the Borrower is not a party to such merger) is the surviving Person, (ii) any Subsidiary may merge into another Subsidiary; provided, that if any party to such merger
is a Subsidiary Loan Party, the Subsidiary Loan Party shall be the surviving Person and (iii) any Subsidiary (other than a Subsidiary Loan Party) may liquidate or dissolve if the Borrower determines in good faith that such liquidation or dissolution
is in the best interests of the Borrower and is not materially disadvantageous to the Lenders; provided, that any such merger involving a Person that is not a wholly-owned Subsidiary immediately prior to such merger shall not be permitted
unless also permitted by Section 7.4. 
  
 (b) The Borrower
will not, and will not permit any of its Subsidiaries to, engage in any business other than businesses of the type conducted by the Borrower and its Subsidiaries on the date hereof and businesses reasonably related thereto. 
  
 Section 7.4. Investments, Loans, Etc. The Borrower will not,
and will not permit any of its Subsidiaries to, purchase, hold or acquire (including pursuant to any merger with any Person that was not a wholly-owned Subsidiary prior to such merger), any common stock, evidence of indebtedness or other securities
(including any option, warrant, or other right to acquire any of the foregoing) of, make or permit to exist any loans or advances to, Guarantee 

  

 50 

 
any obligations of, or make or permit to exist any investment or any other interest in, any other Person (all of the foregoing being collectively called
“Investments”), or purchase or otherwise acquire (in one transaction or a series of transactions) any assets of any other Person that constitute a business unit, or create or form any Subsidiary, except: 
  
 (a) Investments (other than Permitted Investments) existing on the date
hereof and set forth on Schedule 7.4 (including Investments in Subsidiaries); 
  
 (b) Permitted Investments; 
  
 (c)
Guarantees constituting Indebtedness permitted by Section 7.1; 
  
 (d) Investments made by the Borrower in or to any Subsidiary Loan Party and by any Subsidiary to the Borrower or in or to another Subsidiary Loan Party; 
  
 (e) loans or advances to employees, officers or directors of the Borrower or any Subsidiary in the ordinary course of
business for travel, relocation and related expenses; provided, however, that the aggregate amount of all such loans and advances does not exceed $500,000 at any time; 
  
 (f) Hedging Agreements permitted by Section 7.10; and 
  
 (g) Other Investments which in the aggregate do not exceed $1,000,000 in any fiscal year of the Borrower. 
  
 Section 7.5. Restricted Payments. The Borrower will not, and
will not permit its Subsidiaries to, declare or make, or agree to pay or make, directly or indirectly, any dividend on any class of its stock, or make any payment on account of, or set apart assets for a sinking or other analogous fund for, the
purchase, redemption, retirement, defeasance or other acquisition of, any shares of common stock or Indebtedness subordinated to the Obligations of the Borrower or any options, warrants, or other rights to purchase such common stock or such
Indebtedness, whether now or hereafter outstanding (each, a “Restricted Payment”), except for (i) dividends payable by the Borrower in shares of any class of its common, (ii) Restricted Payments made by any Subsidiary to the
Borrower or to another Subsidiary and (iii) cash dividends paid on, and cash redemptions of, the common stock or preferred stock of the Borrower; provided, that no Default or Event of Default has occurred and is continuing at the time such
dividend is paid or redemption is made. 
  
 Section 7.6.
Sale of Assets. The Borrower will not, and will not permit any of its Subsidiaries to, convey, sell, lease, assign, transfer or otherwise dispose of, any of its assets, business or property, whether now owned or hereafter acquired, or, in
the case of any Subsidiary, issue or sell any shares of such Subsidiary’s common stock to any Person other than the Borrower (or to qualify directors if required by applicable law), except (i) the sale or other disposition for fair market value
of obsolete or worn out property or other property not necessary for operations disposed of in the ordinary course of business, (ii) the sale of inventory and Permitted Investments in the ordinary course of business, (iii) the sale of timber land
and real estate in connection with any Asset Like Kind Exchange, (iv) other sales of assets not to exceed 

  

 51 

 
$5,000,000 in the aggregate in any fiscal year of the Borrower or (v) the sale of assets in the ordinary course of business not to exceed $1,000,000 at any
one time. 
  
 Section 7.7. Transactions with
Affiliates. The Borrower will not, and will not permit any of its Subsidiaries to, sell, lease or otherwise transfer any property or assets to, or purchase, lease or otherwise acquire any property or assets from, or otherwise engage in any
other transactions with, any of its Affiliates, except (a) in the ordinary course of business at prices and on terms and conditions not less favorable to the Borrower or such Subsidiary than could be obtained on an arm’s-length basis from
unrelated third parties, (b) transactions between or among the Borrower and its wholly-owned Subsidiaries not involving any other Affiliates and (c) any Restricted Payment permitted by Section 7.5. 
  
 Section 7.8. Restrictive Agreements. The Borrower will not, and
will not permit any Subsidiary to, directly or indirectly, enter into, incur or permit to exist any agreement that prohibits, restricts or imposes any condition upon (a) the ability of the Borrower or any Subsidiary to create, incur or permit any
Lien upon any of its assets or properties, whether now owned or hereafter acquired, or (b) the ability of any Subsidiary to pay dividends or other distributions with respect to its common stock, to make or repay loans or advances to the Borrower or
any other Subsidiary, to Guarantee Indebtedness of the Borrower or any other Subsidiary or to transfer any of its property or assets to the Borrower or any Subsidiary of the Borrower; provided, that (i) the foregoing shall not apply to
restrictions or conditions imposed by law or by this Agreement or any other Loan Document, the Note Purchase Agreement or the Senior Note Documents, (ii) the foregoing shall not apply to customary restrictions and conditions contained in agreements
relating to the sale of a Subsidiary pending such sale, provided such restrictions and conditions apply only to the Subsidiary that is sold and such sale is permitted hereunder, (iii) clause (a) shall not apply to restrictions or conditions imposed
by any agreement relating to secured Indebtedness permitted by this Agreement if such restrictions and conditions apply only to the property or assets securing such Indebtedness and (iv) clause (a) shall not apply to customary provisions in leases
restricting the assignment thereof. 
  
 Section 7.9. Sale
and Leaseback Transactions. The Borrower will not, and will not permit any of the Subsidiaries to, enter into any arrangement, directly or indirectly, whereby it shall sell or transfer any property, real or personal, used or useful in its
business, whether now owned or hereinafter acquired, and thereafter rent or lease such property or other property that it intends to use for substantially the same purpose or purposes as the property sold or transferred. 
  
 Section 7.10. Hedging Agreements. The Borrower will not, and
will not permit any of the Subsidiaries to, enter into any Hedging Agreement other than Hedging Agreements entered into in the ordinary course of business to hedge or mitigate risks to which the Borrower or any Subsidiary is exposed in the conduct
of its business or the management of its liabilities. Solely for the avoidance of doubt, the Borrower acknowledges that a Hedging Agreement entered into for speculative purposes or of a speculative nature (which shall be deemed to include any
Hedging Agreement under which the Borrower or any of the Subsidiaries is or may become obliged to make any payment (i) in connection with the purchase by any third party of any common stock or any Indebtedness or (ii) as a result of changes in the
market value 

  

 52 

 
of any common stock or any Indebtedness) is not a Hedging Agreement entered into in the ordinary course of business to hedge or mitigate risks. 

 
 Section 7.11. Amendment to Material Documents. The Borrower
will not, and will not permit any Subsidiary to, amend, modify or waive any of its rights in a manner materially adverse to the Lenders under (a) its certificate of incorporation, bylaws or other organizational documents, (b) the Del-Tin Agreements
or (c) the Senior Note Documents. 
  
 Section 7.12.
Accounting Changes. The Borrower will not, and will not permit any Subsidiary to, make any significant change in accounting treatment or reporting practices, except as required or permitted by GAAP, or change the fiscal year of the
Borrower or of any Subsidiary, except to change the fiscal year of a Subsidiary to conform its fiscal year to that of the Borrower. 
  
 ARTICLE VIII 
  
 EVENTS OF DEFAULT 
  
 Section 8.1. Events of Default. If any of the following events (each an “Event of Default”) shall occur: 
  
 (a) the Borrower shall fail to pay any principal of any Loan or any reimbursement obligation in respect of any LC
Disbursement when and as the same shall become due and payable, whether at the due date thereof or at a date fixed for prepayment or otherwise; or 
  
 (b) the Borrower shall fail to pay any interest on any Loan or any fee or any other amount (other than an amount payable under clause (a) of this Article)
payable under this Agreement or any other Loan Document, when and as the same shall become due and payable, and such failure shall continue unremedied for a period of three (3) Business Days; or 
  
 (c) any representation or warranty made or deemed made by or on behalf of the
Borrower or any Subsidiary in or in connection with this Agreement or any other Loan Document (including the Schedules attached thereto) and any amendments or modifications hereof or waivers hereunder, or in any certificate, report, financial
statement or other document submitted to the Administrative Agent or the Lenders by any Loan Party or any representative of any Loan Party pursuant to or in connection with this Agreement or any other Loan Document shall prove to be incorrect in any
material respect when made or deemed made or submitted; or 
  
 (d)
the Borrower shall fail to observe or perform any covenant or agreement contained in Sections 5.1, 5.2, 5.3 (with respect to the Borrower’s existence) or Articles VI or VII; or 
  
 (e) any Loan Party shall fail to observe or perform any covenant or agreement
contained in this Agreement (other than those referred to in clauses (a), (b) and (d) above), and such failure shall remain unremedied for 30 days after the earlier of (i) any officer of the 

  

 53 

 
Borrower becomes aware of such failure, or (ii) notice thereof shall have been given to the Borrower by the Administrative Agent or any Lender; or

  
 (f) the Borrower or any Subsidiary (whether as primary obligor
or as guarantor or other surety) shall fail to pay any principal of or premium or interest on any Material Indebtedness that is outstanding, when and as the same shall become due and payable (whether at scheduled maturity, required prepayment,
acceleration, demand or otherwise), and such failure shall continue after the applicable grace period, if any, specified in the agreement or instrument evidencing such Indebtedness; or any other event shall occur or condition shall exist under any
agreement or instrument relating to such Indebtedness and shall continue after the applicable grace period, if any, specified in such agreement or instrument, if the effect of such event or condition is to accelerate, or permit the acceleration of,
the maturity of such Indebtedness; or any such Indebtedness shall be declared to be due and payable; or required to be prepaid or redeemed (other than by a regularly scheduled required prepayment or redemption), purchased or defeased, or any offer
to prepay, redeem, purchase or defease such Indebtedness shall be required to be made, in each case prior to the stated maturity thereof; or 
  
 (g) the Borrower or any Subsidiary Loan Party shall (i) commence a voluntary case or other proceeding or file any petition seeking liquidation,
reorganization or other relief under any federal, state or foreign bankruptcy, insolvency or other similar law now or hereafter in effect or seeking the appointment of a custodian, trustee, receiver, liquidator or other similar official of it or any
substantial part of its property, (ii) consent to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or petition described in clause (i) of this Section, (iii) apply for or consent to the appointment of a
custodian, trustee, receiver, liquidator or other similar official for the Borrower or any such Subsidiary Loan Party or for a substantial part of its assets, (iv) file an answer admitting the material allegations of a petition filed against it in
any such proceeding, (v) make a general assignment for the benefit of creditors, or (vi) take any action for the purpose of effecting any of the foregoing; or 
  

(h) an involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (i) liquidation, reorganization or other relief in
respect of the Borrower or any Subsidiary Loan Party or its debts, or any substantial part of its assets, under any federal, state or foreign bankruptcy, insolvency or other similar law now or hereafter in effect or (ii) the appointment of a
custodian, trustee, receiver, liquidator or other similar official for the Borrower or any Subsidiary Loan Party or for a substantial part of its assets, and in any such case, such proceeding or petition shall remain undismissed for a period of 60
days or an order or decree approving or ordering any of the foregoing shall be entered; or 
  
 (i) the Borrower or any Subsidiary Loan Party shall become unable to pay, shall admit in writing its inability to pay, or shall fail to pay, its debts as they become due; or 
  
 (j) an ERISA Event shall have occurred that, in the opinion of the Required
Lenders, when taken together with other ERISA Events that have occurred, could reasonably be expected to result in liability to the Borrower and the Subsidiaries in an aggregate amount exceeding $5,000,000; or 
  

 54 

 (k) any judgment or order for the payment of money in excess of $500,000 in the aggregate shall be
rendered against the Borrower or any Subsidiary, and either (i) enforcement proceedings shall have been commenced by any creditor upon such judgment or order or (ii) there shall be a period of 30 consecutive days during which a stay of enforcement
of such judgment or order, by reason of a pending appeal or otherwise, shall not be in effect; or 
  
 (l) any non-monetary judgment or order shall be rendered against the Borrower or any Subsidiary that could reasonably be expected to have a Material
Adverse Effect, and there shall be a period of 30 consecutive days during which a stay of enforcement of such judgment or order, by reason of a pending appeal or otherwise, shall not be in effect; or 
  
 (m) a Change in Control shall occur or exist; or 
  
 (n) any provision of any Subsidiary Guaranty Agreement shall for any reason
cease to be valid and binding on, or enforceable against, any Subsidiary Loan Party, or any Subsidiary Loan Party shall so state in writing, or any Subsidiary Loan Party shall seek to terminate its Subsidiary Guaranty Agreement; or 
  
 (o) an “Event of Default” shall occur under any other Loan
Document; then, and in every such event (other than an event with respect to the Borrower described in clause (g) or (h) of this Section) and at any time thereafter during the continuance of such event, the Administrative Agent may, and upon the
written request of the Required Lenders shall, by notice to the Borrower, take any or all of the following actions, at the same or different times: (i) terminate the Commitments, whereupon the Commitment of each Lender shall terminate
immediately; (ii) declare the principal of and any accrued interest on the Loans, and all other Obligations owing hereunder, to be, whereupon the same shall become due and payable immediately, without presentment, demand, protest or other notice of
any kind, all of which are hereby waived by the Borrower and (iii) exercise all remedies contained in any other Loan Document; and that, if an Event of Default specified in either clause (g) or (h) shall occur, the Commitments shall automatically
terminate and the principal of the Loans then outstanding, together with accrued interest thereon, and all fees, and all other Obligations shall automatically become due and payable, without presentment, demand, protest or other notice of any kind,
all of which are hereby waived by the Borrower. 
  
 ARTICLE IX

  
 THE ADMINISTRATIVE AGENT 
  
 Section 9.1. Appointment of Administrative Agent. 

 
 (a) Each Lender irrevocably appoints SunTrust Bank as the Administrative
Agent and authorizes it to take such actions on its behalf and to exercise such powers as are delegated to the Administrative Agent under this Agreement and the other Loan Documents, together with all such actions and powers that are reasonably
incidental thereto. The Administrative Agent may perform any of its duties hereunder by or through any one or more sub-agents appointed by the Administrative Agent. The Administrative Agent and any such sub- 

  

 55 

 
agent may perform any and all of its duties and exercise its rights and powers through their respective Related Parties. The exculpatory provisions set forth
in this Article shall apply to any such sub-agent and the Related Parties of the Administrative Agent and any such sub-agent and shall apply to their respective activities in connection with the syndication of the credit facilities provided for
herein as well as activities as Administrative Agent. 
  
 (b) The
Issuing Bank shall act on behalf of the Lenders with respect to any Letters of Credit issued by it and the documents associated therewith until such time and except for so long as the Administrative Agent may agree at the request of the Required
Lenders to act for the Issuing Bank with respect thereto; provided, that the Issuing Bank shall have all the benefits and immunities (i) provided to the Administrative Agent in this Article IX with respect to any acts taken or omissions suffered by
the Issuing Bank in connection with Letters of Credit issued by it or proposed to be issued by it and the application and agreements for Letters of Credit pertaining to the Letters of Credit as fully as the term “Administrative Agent” as
used in this Article IX included the Issuing Bank with respect to such acts or omissions and (ii) as additionally provided in this Agreement with respect to the Issuing Bank. 
  
 Section 9.2. Nature of Duties of Administrative Agent. The Administrative Agent shall not have any duties or
obligations except those expressly set forth in this Agreement and the other Loan Documents. Without limiting the generality of the foregoing, (a) the Administrative Agent shall not be subject to any fiduciary or other implied duties, regardless of
whether a Default or an Event of Default has occurred and is continuing, (b) the Administrative Agent shall not have any duty to take any discretionary action or exercise any discretionary powers, except those discretionary rights and powers
expressly contemplated by the Loan Documents that the Administrative Agent is required to exercise in writing by the Required Lenders (or such other number or percentage of the Lenders as shall be necessary under the circumstances as provided in
Section 10.2), and (c) except as expressly set forth in the Loan Documents, the Administrative Agent shall not have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to the Borrower or any of its
Subsidiaries that is communicated to or obtained by the Administrative Agent or any of its Affiliates in any capacity. The Administrative Agent shall not be liable for any action taken or not taken by it with the consent or at the request of the
Required Lenders (or such other number or percentage of the Lenders as shall be necessary under the circumstances as provided in Section 10.2) or in the absence of its own gross negligence or willful misconduct. The Administrative Agent shall not be
deemed to have knowledge of any Default or Event of Default unless and until written notice thereof is given to the Administrative Agent by the Borrower or any Lender, and the Administrative Agent shall not be responsible for or have any duty to
ascertain or inquire into (i) any statement, warranty or representation made in or in connection with any Loan Document, (ii) the contents of any certificate, report or other document delivered hereunder or thereunder or in connection herewith or
therewith, (iii) the performance or observance of any of the covenants, agreements, or other terms and conditions set forth in any Loan Document, (iv) the validity, enforceability, effectiveness or genuineness of any Loan Document or any other
agreement, instrument or document, or (v) the satisfaction of any 

  

 56 

 
condition set forth in Article III or elsewhere in any Loan Document, other than to confirm receipt of items expressly required to be delivered to the
Administrative Agent. 
  
 Section 9.3. Lack of Reliance on
the Administrative Agent. Each of the Lenders, the Swingline Lender and the Issuing Bank acknowledges that it has, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and
information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each of the Lenders, the Swingline Lender and the Issuing Bank also acknowledges that it will, independently and without reliance upon
the Administrative Agent or any other Lender and based on such documents and information as it has deemed appropriate, continue to make its own decisions in taking or not taking of any action under or based on this Agreement, any related agreement
or any document furnished hereunder or thereunder. 
  
 Section
9.4. Certain Rights of the Administrative Agent. If the Administrative Agent shall request instructions from the Required Lenders with respect to any action or actions (including the failure to act) in connection with this Agreement, the
Administrative Agent shall be entitled to refrain from such act or taking such act, unless and until it shall have received instructions from such Lenders; and the Administrative Agent shall not incur liability to any Person by reason of so
refraining. Without limiting the foregoing, no Lender shall have any right of action whatsoever against the Administrative Agent as a result of the Administrative Agent acting or refraining from acting hereunder in accordance with the instructions
of the Required Lenders where required by the terms of this Agreement. 
  
 Section 9.5. Reliance by Administrative Agent. The Administrative Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument,
document or other writing believed by it to be genuine and to have been signed, sent or made by the proper Person. The Administrative Agent may also rely upon any statement made to it orally or by telephone and believed by it to be made by the
proper Person and shall not incur any liability for relying thereon. The Administrative Agent may consult with legal counsel (including counsel for the Borrower), independent public accountants and other experts selected by it and shall not be
liable for any action taken or not taken by it in accordance with the advice of such counsel, accountants or experts. 
  
 Section 9.6. The Administrative Agent in its Individual Capacity. The bank serving as the Administrative Agent shall have the same rights
and powers under this Agreement and any other Loan Document in its capacity as a Lender as any other Lender and may exercise or refrain from exercising the same as though it were not the Administrative Agent; and the terms “Lenders”,
“Required Lenders”, “holders of Notes”, or any similar terms shall, unless the context clearly otherwise indicates, include the Administrative Agent in its individual capacity. The bank acting as the Administrative Agent and its
Affiliates may accept deposits from, lend money to, and generally engage in any kind of business with the Borrower or any Subsidiary or Affiliate of the Borrower as if it were not the Administrative Agent hereunder. 
  

 57 

 Section 9.7. Successor Administrative Agent. 
  
 (a) The Administrative Agent may resign at any time by giving notice thereof
to the Lenders and the Borrower. Upon any such resignation, the Required Lenders shall have the right to appoint a successor Administrative Agent, subject to the approval by the Borrower provided that no Default or Event of Default shall exist at
such time. If no successor Administrative Agent shall have been so appointed, and shall have accepted such appointment within 30 days after the retiring Administrative Agent gives notice of resignation, then the retiring Administrative Agent may, on
behalf of the Lenders and the Issuing Bank, appoint a successor Administrative Agent, which shall be a commercial bank organized under the laws of the United States of America or any state thereof or a bank which maintains an office in the United
States, having a combined capital and surplus of at least $500,000,000. 
  
 (b) Upon the acceptance of its appointment as the Administrative Agent hereunder by a successor, such successor Administrative Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the
retiring Administrative Agent, and the retiring Administrative Agent shall be discharged from its duties and obligations under this Agreement and the other Loan Documents. If within 45 days after written notice is given of the retiring
Administrative Agent’s resignation under this Section 9.7 no successor Administrative Agent shall have been appointed and shall have accepted such appointment, then on such 45th day (i) the retiring Administrative Agent’s resignation shall become effective, (ii) the retiring Administrative Agent shall thereupon be discharged from
its duties and obligations under the Loan Documents and (iii) the Required Lenders shall thereafter perform all duties of the retiring Administrative Agent under the Loan Documents until such time as the Required Lenders appoint a successor
Administrative Agent as provided above. After any retiring Administrative Agent’s resignation hereunder, the provisions of this Article IX shall continue in effect for the benefit of such retiring Administrative Agent and its representatives
and agents in respect of any actions taken or not taken by any of them while it was serving as the Administrative Agent. 
  
 Section 9.8. Authorization to Execute other Loan Documents. Each Lender hereby authorizes the Administrative Agent to execute on behalf of
all Lenders all Loan Documents other than this Agreement. 
  
 Section 9.9. Syndication Agent. Each Lender hereby designates Bank One, N.A. as Syndication Agent and agrees that the Syndication Agent shall have no duties or obligations under any Loan Documents to any Lender or any Loan
Party. 
  

 58 

 ARTICLE X 
  

MISCELLANEOUS 
  
 Section 10.1. Notices. 
  
 (a) Except in the case of notices and other communications expressly permitted to be given by telephone, all notices and other communications to any party
herein to be effective shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by telecopy, as follows: 
  

	 To the Borrower:
	 	Deltic Timber Corporation
	 	 	210 East Elm
	 	 	El Dorado, Arkansas 71730
	 	 	Attention: Mr. Clef Vaughan
	 	 	Telecopy Number: (870) 881-6457
	 	 	 
	 To the Administrative Agent
	 	SunTrust Bank
	 or the Swingline Lender:
	 	600 Poplar Avenue, Suite 320
	 	 	Memphis, TN 38119
	 	 	Attention: Leonard McKinnon
	 	 	 Telecopy Number: (901)766-7565 fax

	 	 	 
	 With a copy to:
	 	 SunTrust Agency Services

	 	 	 303 Peachtree Street, N. E./ 25th Floor

	 	 	 Atlanta, Georgia 30308

	 	 	 Attention: Doris Folsom

	 	 	 Telecopy Number: (404) 724-3879

	 	 	 
	 To any other Lender:
	 	 the address set forth in the Administrative Questionnaire

  
 Any party hereto may change its
address or telecopy number for notices and other communications hereunder by notice to the other parties hereto. All such notices and other communications shall, when transmitted by overnight delivery, or faxed, be effective when delivered for
overnight (next-day) delivery, or transmitted in legible form by facsimile machine, respectively, or if mailed, upon the third Business Day after the date deposited into the mails or if delivered, upon receipt; provided, that notices delivered to
the Administrative Agent, the Issuing Bank or the Swingline Bank shall not be effective until actually received by such Person at its address specified in this Section 10.1. 
  
 (b) Any agreement of the Administrative Agent and the Lenders herein to receive certain notices by telephone or facsimile is
solely for the convenience and at the request of the Borrower. The Administrative Agent and the Lenders shall be entitled to rely on the authority of any Person purporting to be a Person authorized by the Borrower to give such notice 

  

 59 

 
and the Administrative Agent and Lenders shall not have any liability to the Borrower or other Person on account of any action taken or not taken by the
Administrative Agent or the Lenders in reliance upon such telephonic or facsimile notice. The obligation of the Borrower to repay the Loans and all other Obligations hereunder shall not be affected in any way or to any extent by any failure of the
Administrative Agent and the Lenders to receive written confirmation of any telephonic or facsimile notice or the receipt by the Administrative Agent and the Lenders of a confirmation which is at variance with the terms understood by the
Administrative Agent and the Lenders to be contained in any such telephonic or facsimile notice. 
  
 Section 10.2. Waiver; Amendments. 
  
 (a) No failure or delay by the Administrative Agent, the Issuing Bank or any Lender in exercising any right or power hereunder or any other Loan Document,
and no course of dealing between the Borrower and the Administrative Agent or any Lender, shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power or any abandonment or discontinuance of steps to
enforce such right or power, preclude any other or further exercise thereof or the exercise of any other right or power hereunder or thereunder. The rights and remedies of the Administrative Agent, the Issuing Bank and the Lenders hereunder and
under the other Loan Documents are cumulative and are not exclusive of any rights or remedies provided by law. No waiver of any provision of this Agreement or any other Loan Document or consent to any departure by the Borrower therefrom shall in any
event be effective unless the same shall be permitted by paragraph (b) of this Section, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given. Without limiting the generality of the
foregoing, the making of a Loan or the issuance of a Letter of Credit shall not be construed as a waiver of any Default or Event of Default, regardless of whether the Administrative Agent or any Lender or the Issuing Bank may have had notice or
knowledge of such Default or Event of Default at the time. 
  
 (b)
No amendment or waiver of any provision of this Agreement or the other Loan Documents, nor consent to any departure by the Borrower therefrom, shall in any event be effective unless the same shall be in writing and signed by the Borrower and the
Required Lenders or the Borrower and the Administrative Agent with the consent of the Required Lenders and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given; provided,
that no amendment or waiver shall: (i) increase the Commitment of any Lender without the written consent of such Lender, (ii) reduce the principal amount of any Loan or reduce the rate of interest thereon, or reduce any fees payable hereunder,
without the written consent of each Lender affected thereby, (iii) postpone the date fixed for any payment of any principal of, or interest on, any Loan or any fees hereunder or reduce the amount of, waive or excuse any such payment, or postpone the
scheduled date for the termination or reduction of any Commitment, without the written consent of each Lender affected thereby, (iv) change Section 2.20 (b) or (c) in a manner that would alter the pro rata sharing of payments required
thereby, without the written consent of each Lender, (v) change any of the provisions of this Section or the definition of “Required Lenders” or any other provision hereof specifying the number or percentage of Lenders which are required
to waive, amend or modify any rights hereunder or make any determination or grant any consent hereunder, without the consent of each Lender; (vi) release any guarantor or limit the liability of any such guarantor under any 

  

 60 

 
guaranty agreement, without the written consent of each Lender; (vii) release all or substantially all collateral (if any) securing any of the Obligations,
without the written consent of each Lender; provided further, that no such agreement shall amend, modify or otherwise affect the rights, duties or obligations of the Administrative Agent, the Swingline Bank or the Issuing Bank without the
prior written consent of such Person. 
  
 Section 10.3.
Expenses; Indemnification. 
  
 (a) The Borrower shall
pay (i) all reasonable, out-of-pocket costs and expenses of the Administrative Agent and its Affiliates, including the reasonable fees, charges and disbursements of counsel for the Administrative Agent and its Affiliates, in connection with the
syndication of the credit facilities provided for herein, the preparation and administration of the Loan Documents and any amendments, modifications or waivers thereof (whether or not the transactions contemplated in this Agreement or any other Loan
Document shall be consummated), (ii) all reasonable out-of-pocket expenses incurred by the Issuing Bank in connection with the issuance, amendment, renewal or extension of any Letter of Credit or any demand for payment thereunder and (iii) all
out-of-pocket costs and expenses (including, without limitation, the reasonable fees, charges and disbursements of outside counsel) incurred by the Administrative Agent, the Issuing Bank or any Lender in connection with the enforcement or protection
of its rights in connection with this Agreement, including its rights under this Section, or in connection with the Loans made or any Letters of Credit issued hereunder, including all such out-of-pocket expenses incurred during any workout,
restructuring or negotiations in respect of such Loans or Letters of Credit. 
  
 (b) The Borrower shall indemnify the Administrative Agent, the Issuing Bank and each Lender, and each Related Party of any of the foregoing (each, an “Indemnitee”) against, and hold each of
them harmless from, any and all reasonable costs, losses, liabilities, claims, damages and related expenses, including the fees, charges and disbursements of any counsel for any Indemnitee, which may be incurred by or asserted against any Indemnitee
arising out of, in connection with or as a result of (i) the execution or delivery of this Agreement or any other agreement or instrument contemplated hereby, the performance by the parties hereto of their respective obligations hereunder or the
consummation of any of the transactions contemplated hereby, (ii) any Loan or Letter of Credit or any actual or proposed use of the proceeds therefrom (including any refusal by the Issuing Bank to honor a demand for payment under a Letter of Credit
if the documents presented in connection with such demand do not strictly comply with the terms of the Letter of Credit), (iii) any actual or alleged presence or release of Hazardous Materials on or from any property owned by the Borrower or any
Subsidiary or any Environmental Liability related in any way to the Borrower or any Subsidiary or (iv) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any
other theory and regardless of whether any Indemnitee is a party thereto; provided, that the Borrower shall not be obligated to indemnify any Indemnitee for any of the foregoing arising out of such Indemnitee’s gross negligence or
willful misconduct as determined by a court of competent jurisdiction in a final and nonappealable judgment. 
  

 61 

 (c) The Borrower shall pay, and hold the Administrative Agent and each of the Lenders harmless from and
against, any and all present and future stamp, documentary, and other similar taxes with respect to this Agreement and any other Loan Documents, any collateral described therein, or any payments due thereunder, and save the Administrative Agent and
each Lender harmless from and against any and all liabilities with respect to or resulting from any delay or omission to pay such taxes. 
  
 (d) To the extent that the Borrower fails to pay any amount required to be paid to the Administrative Agent, the Issuing Bank or the Swingline Lender
under clauses (a), (b) or (c) hereof, each Lender severally agrees to pay to the Administrative Agent, the Issuing Bank or the Swingline Lender, as the case may be, such Lender’s Pro Rata Share (determined as of the time that the unreimbursed
expense or indemnity payment is sought) of such unpaid amount; provided, that the unreimbursed expense or indemnified payment, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against the Administrative
Agent, the Issuing Bank or the Swingline Lender in its capacity as such. 
  
 (e) To the extent permitted by applicable law, the Borrower shall not assert, and hereby waives, any claim against any Indemnitee, on any theory of liability, for special, indirect, consequential or punitive damages
(as opposed to actual or direct damages) arising out of, in connection with or as a result of, this Agreement or any agreement or instrument contemplated hereby, the transactions contemplated therein, any Loan or any Letter of Credit or the use of
proceeds thereof. 
  
 (f) All amounts due under this Section shall
be payable promptly after written demand therefor. 
  
 Section
10.4. Successors and Assigns. 
  
 (a) The provisions of
this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns, except that the Borrower may not assign or transfer any of its rights or obligations hereunder without the prior written
consent of each Lender (and any attempted assignment or transfer by the Borrower without such consent shall be null and void). Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties
hereto, their respective successors and assigns permitted hereby and, to the extent expressly contemplated hereby, the Related Parties of each of the Administrative Agent and the Lenders) any legal or equitable right, remedy or claim under or by
reason of this Agreement. 
  
 (b) Any Lender may assign to one or
more Eligible Assignees at any time assign to one or more assignees all or a portion of its rights and obligations under this Agreement and the other Loan Documents (including all or a portion of its Commitment and the Loans and LC Exposure at the
time owing to it); provided, that (i) except in the case of an assignment of the entire remaining amount of the assigning Lender’s Commitment, the LC Exposure and the Revolving Credit Exposure owing to it or in the case of an assignment
to a Lender or an Affiliate of a Lender or an Approved Fund with respect to a Lender, the aggregate amount of the Commitment (which for this purpose includes Revolving Credit Exposure outstanding 

  

 62 

 
thereunder) of the assigning Lender subject to each such assignment (determined as of the date the Assignment and Acceptance with respect to such assignment
is delivered to the Administrative Agent) shall not be less than $1,000,000, unless each of the Administrative Agent and, so long as no Event of Default has occurred and is continuing, the Borrower otherwise consent (each such consent not to be
unreasonably withheld or delayed; provided, that the Borrower shall be deemed to have reasonably withheld such consent if the Eligible Assignee is a bank owned by any forest products company), (ii) each partial assignment shall be made as an
assignment of a proportionate part of all the assigning Lender’s rights and obligations under this Agreement with respect to the Commitment or Revolving Credit Exposure assigned, except that this clause (ii) shall not prohibit any Lender from
assigning all or a portion of its rights and obligations on a non-pro rata basis, and (iii) the parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Acceptance, together with a processing and
recordation fee of $1,000, and the Eligible Assignee, if it shall not be a Lender, shall deliver to the Administrative Agent an Administrative Questionnaire and, if it is a Foreign Lender, the appropriate documents required under Section
2.19(e). Subject to acceptance and recording thereof by the Administrative Agent pursuant to paragraph (c) of this Section, from and after the effective date specified in each Assignment and Acceptance, the Eligible Assignee thereunder shall be
a party hereto and, to the extent of the interest assigned by such Assignment and Acceptance, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such
Assignment and Acceptance, be released from its obligations under this Agreement (and, in the case of an Assignment and Acceptance covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be
a party hereto but shall continue to be entitled to the benefits of Sections 2.17, 2.18 and 2.19 and 10.3). Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with
this paragraph shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with paragraph (d) of this Section. Any consent of the Borrower otherwise required hereunder
shall not be required if an Event of Default has occurred and is continuing. Upon the consummation of any such assignment hereunder, the assigning Lender, the Administrative Agent and the Borrower shall make appropriate arrangements to have new
Notes issued if so requested by either or both the assigning Lender or the assignee. Any assignment or other transfer by a Lender that does not fully comply with the terms of this clause (b) shall be treated for purposes of this Agreement as a sale
of a participation pursuant to clause (d) below. 
  
 (c) The
Administrative Agent, acting solely for this purpose as an agent of the Borrower, shall maintain at one of its offices in Atlanta, Georgia, or at the offices of its designated agent, a copy of each Assignment and Acceptance delivered to it and a
register for the recordation of the names and addresses of the Lenders, and the Commitments of, and principal amount of the Loans owing to, each Lender pursuant to the terms hereof from time to time (the “Register”). The entries in
the Register shall be conclusive, and the Borrower, the Administrative Agent and the Lenders may treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary. The Register shall be available for inspection by the Borrower and any Lender, at any reasonable time and from time to time upon reasonable prior notice. 
  

 63 

 (d) Any Lender may, without the consent of, or notice to, the Borrower, the Administrative Agent, the
Issuing Bank or the Swingline Lender, sell participations to one or more banks or other entities (a “Participant”) in all or a portion of such Lender’s rights and obligations under this Agreement (including all or a portion of
its Commitment, the Loans owing to it and its other Revolving Credit Exposure); provided, that (i) such Lender’s obligations under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the
other parties hereto for the performance of its obligations hereunder, and (iii) the Borrower, the Administrative Agent, the Issuing Bank, the Swingline Bank and the other Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender’s rights and obligations under this Agreement and the other Loan Documents. Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right
to enforce this Agreement and the other Loan Documents and to approve any amendment, modification or waiver of any provision of this Agreement and the other Loan Documents; provided, that such agreement or instrument may provide that such
Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver of this Agreement described in the first proviso of Section 10.2(b) that affect the Participant. Subject to paragraph (e) of this Section,
the Borrower agrees that each Participant shall be entitled to the benefits of Sections 2.17, 2.18 and 2.19 to the same extent as if it were a Lender hereunder and had acquired its interest by assignment pursuant to paragraph
(b) of this Section. To the extent permitted by law, each Participant shall also be entitled to the benefits of Section 2.20 as though it were a Lender, provided, that such Participant agrees to be subject to Section 2.20 as
though it were a Lender hereunder. 
  
 (e) A Participant shall not
be entitled to receive any greater payment under Section 2.17, 2.18 and 2.19 than the applicable Lender would have been entitled to receive with respect to the participation sold to such Participant, unless the sale of the participation to
such Participant is made with the Borrower’s prior written consent. A Participant that would be a Foreign Lender if it were a Lender shall not be entitled to the benefits of Section 2.19 unless the Borrower is notified of the
participation sold to such Participant and such Participant agrees, for the benefit of the Borrower, to comply with Section 2.19(e) as though it were a Lender. 
  
 (e) Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement
and its Notes to secure obligations of such Lender, including without limitation any pledge or assignment to secure obligations to a Federal Reserve Bank; provided, that no such pledge or assignment of a security interest shall release
a Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto. 
  
 Section 10.5. Governing Law; Jurisdiction; Consent to Service of Process. 
  
 (a) This Agreement and the other Loan Documents shall be construed in accordance with and be governed by the law (without
giving effect to the conflict of law principles thereof) of the State of Georgia. 
  

 64 

 (b) The Borrower hereby irrevocably and unconditionally submits to the non-exclusive jurisdiction of the
United States District Court of the Northern District of Georgia, and of any state court of the State of Georgia located in Fulton County and any appellate court from any thereof, in any action or proceeding arising out of or relating to this
Agreement or any other Loan Document or the transactions contemplated hereby or thereby, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of
any such action or proceeding may be heard and determined in such Georgia state court or, to the extent permitted by applicable law, such Federal court. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall
be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Agreement or any other Loan Document shall affect any right that the Administrative Agent, the Issuing Bank or
any Lender may otherwise have to bring any action or proceeding relating to this Agreement or any other Loan Document against the Borrower in the courts of any jurisdiction. 
  
 (c) The Borrower irrevocably and unconditionally waives any objection which it may now or hereafter have to the laying of
venue of any such suit, action or proceeding described in paragraph (b) of this Section and brought in any court referred to in paragraph (b) of this Section. Each of the parties hereto irrevocably waives, to the fullest extent permitted by
applicable law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court. 
  
 (d) Each party to this Agreement irrevocably consents to the service of process in the manner provided for notices in Section 10.1. Nothing in this
Agreement or in any other Loan Document will affect the right of any party hereto to serve process in any other manner permitted by law. 
  
 Section 10.6. WAIVER OF JURY TRIAL. EACH PARTY HERETO IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT
MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY
HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, AND (B) ACKNOWLEDGES THAT
IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION. 
  
 Section 10.7. Right of Setoff. In addition to any rights now or hereafter granted under applicable law and not
by way of limitation of any such rights, each Lender and the Issuing Bank shall have the right, at any time or from time to time upon the occurrence and during the continuance of an Event of Default, without prior notice to the Borrower, any such

  

 65 

 
notice being expressly waived by the Borrower to the extent permitted by applicable law, to set off and apply against all deposits (general or special, time
or demand, provisional or final) of the Borrower at any time held or other obligations at any time owing by such Lender or the Issuing Bank to or for the credit or the account of the Borrower against any and all Obligations held by such Lender or
the Issuing Bank irrespective of whether such Lender or the Issuing Bank shall have made demand hereunder and although such Obligations may be unmatured. Each Lender and the Issuing Bank agrees promptly to notify the Administrative Agent and the
Borrower after any such set-off and any application made by such Lender and the Issuing Bank, as the case may be; provided, that the failure to give such notice shall not affect the validity of such set-off and application. 
  
 Section 10.8. Counterparts; Integration. This Agreement may be
executed by one or more of the parties to this Agreement on any number of separate counterparts (including by telecopy), and all of said counterparts taken together shall be deemed to constitute one and the same instrument. This Agreement, the other
Loan Documents, and any separate letter agreement(s) relating to any fees payable to the Administrative Agent constitute the entire agreement among the parties hereto and thereto regarding the subject matters hereof and thereof and supersede all
prior agreements and understandings, oral or written, regarding such subject matters. 
  
 Section 10.9. Survival. All covenants, agreements, representations and warranties made by the Borrower herein and in the certificates or other instruments delivered in connection with or pursuant to this
Agreement shall be considered to have been relied upon by the other parties hereto and shall survive the execution and delivery of this Agreement and the making of any Loans and the issuance of any Letters of Credit, regardless of any investigation
made by any such other party or on its behalf and notwithstanding that the Administrative Agent, the Issuing Bank or any Lender may have had notice or knowledge of any Default or incorrect representation or warranty at the time any credit is
extended hereunder, and shall continue in full force and effect as long as the principal of or any accrued interest on any Loan or any fee or any other amount payable under this Agreement is outstanding and unpaid or any Letter of Credit is
outstanding, and so long as the Commitments have not expired or terminated. The provisions of Sections 2.17, 2.18, 2.19, and 10.3 and Article IX shall survive and remain in full force and effect regardless of the
consummation of the transactions contemplated hereby, the repayment of the Loans, the expiration or termination of the Letters of Credit and, the Commitments or the termination of this Agreement or any provision hereof. All representations and
warranties made herein, in the certificates, reports, notices, and other documents delivered pursuant to this Agreement shall survive the execution and delivery of this Agreement and the other Loan Documents, the making of the Loans and the issuance
of the Letter of Credit. 
  
 Section 10.10.
Severability. Any provision of this Agreement or any other Loan Document held to be illegal, invalid or unenforceable in any jurisdiction, shall, as to such jurisdiction, be ineffective to the extent of such illegality, invalidity or
unenforceability without affecting the legality, validity or enforceability of the remaining provisions hereof or thereof. 
  

 66 

 Section 10.11. Confidentiality. The Administrative Agent, the Issuing Bank and each Lender
agrees to take normal and reasonable precautions to maintain the confidentiality of any information designated in writing as confidential and provided to it by the Borrower or any Subsidiary, except that such information may be disclosed (i) to any
Related Party of the Administrative Agent, the Issuing Bank or any such Lender, including without limitation accountants, legal counsel and other advisors, (ii) to the extent required by applicable laws or regulations or by any subpoena or similar
legal process, (iii) to the extent requested by any regulatory agency or authority, (iv) to the extent that such information becomes publicly available other than as a result of a breach of this Section, or which becomes available to the
Administrative Agent, the Issuing Bank any Lender or any Related Party of any of the foregoing on a nonconfidential basis from a source other than the Borrower, (v) in connection with the exercise of any remedy hereunder or any suit, action or
proceeding relating to this Agreement or the enforcement of rights hereunder, and (ix) subject to provisions substantially similar to this Section 10.11, to any actual or prospective assignee or Participant, or (vi) with the consent of the
Borrower. Any Person required to maintain the confidentiality of any information as provided for in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the
confidentiality of such information as such Person would accord its own confidential information. 
  
 Section 10.12. Interest Rate Limitation. Notwithstanding anything herein to the contrary, if at any time the interest rate applicable to any
Loan, together with all fees, charges and other amounts which may be treated as interest on such Loan under applicable law (collectively, the “Charges”), shall exceed the maximum lawful rate of interest (the
“Maximum Rate”) which may be contracted for, charged, taken, received or reserved by a Lender holding such Loan in accordance with applicable law, the rate of interest payable in respect of such Loan hereunder, together with
all Charges payable in respect thereof, shall be limited to the Maximum Rate and, to the extent lawful, the interest and Charges that would have been payable in respect of such Loan but were not payable as a result of the operation of this Section
shall be cumulated and the interest and Charges payable to such Lender in respect of other Loans or periods shall be increased (but not above the Maximum Rate therefor) until such cumulated amount, together with interest thereon at the Federal Funds
Rate to the date of repayment, shall have been received by such Lender. 
  
 Section 10.13. Waiver of Effect of Corporate Seal. The Borrower represents and warrants that neither it nor any other Loan Party is required to affix its corporate or company seal to this Agreement or any other Loan Document
pursuant to any requirement of law or regulation, and waives any shortening of the statute of limitations that may result from not affixing the corporate seal to this Agreement or such other Loan Documents. 
  

 67 

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

	DELTIC TIMBER CORPORATION
		
	By:	 	 
	 	

	 Name:
	 	 
	 	

	 Title:
	 	 
	 	

	SUNTRUST BANK
as Administrative Agent, as Issuing Bank, as Swingline Lender and as a Lender
		
	By:	 	 
	 	

	 Name:
	 	 
	 	

	 Title:
	 	 
	 	

  
 Revolving
Commitment: $35,000,000 
 Swingline Commitment: $5,000,000 
  

 69 

	BANK ONE, N.A.,
as Syndication Agent and a Lender
		
	By:	 	 
	 	

	 Name:
	 	 
	 	

	 Title:
	 	 
	 	

  
 Revolving
Commitment: $30,000,000 
  

 70 

	AMERICAN AGCREDIT, PCA
		
	By:	 	 
	 	

	 Name:
	 	 
	 	

	 Title:
	 	 
	 	

  
 Revolving
Commitment: $24,000,000 
  

 71 

	REGIONS BANK
		
	By:	 	 
	 	

	 Name:
	 	 
	 	

	 Title:
	 	 
	 	

  
 Revolving
Commitment: $24,000,000 
  

 72 

	BANCORPSOUTH BANK
		
	By:	 	 
	 	

	 Name:
	 	 
	 	

	 Title:
	 	 
	 	

  
 Revolving
Commitment: $12,000,000 
  

 73First Amendment to the Preferrd Stock Rights Agreement

 EXHIBIT 4.2 
  

FIRST AMENDMENT 
  
 to the 
  
 PREFERRED STOCK RIGHTS AGREEMENT 
  
 between 
  
 NEW FOCUS,
INC. 
  
 and 
  
 EQUISERVE TRUST COMPANY, N.A. 
  
 This First Amendment to the Preferred Stock Rights Agreement (the
“Amendment”) is made and entered into as of September 29, 2003 between NEW FOCUS, INC., a Delaware corporation (the “Company”), and EQUISERVE TRUST COMPANY, N.A., as Rights Agent (the
“Rights Agent”). 
  
 R E C I T A L S

  
 WHEREAS, the Company and the Rights Agent entered into the
Preferred Stock Rights Agreement dated as of July 26, 2001 (the “Rights Agreement”); 
  
 WHEREAS, Section 27 of the Rights Agreement provides that, prior to the Distribution Date (as defined in the Rights Agreement), the Company may supplement
or amend the Rights Agreement in any respect without the approval of any holders of Rights; 
  
 WHEREAS, the Company, Bookham Technology plc, a public limited company incorporated under the laws of England and Wales (the “Parent”), and Budapest Acquisition Corp., a Delaware corporation
and a wholly owned subsidiary of the Parent (the “Transitory Subsidiary”) intend to enter into an Agreement and Plan of Merger (the “Merger Agreement”) pursuant to which, among other things, Transitory
Subsidiary will merge with and into the Company (the “Merger”) and the outstanding shares of Common Stock of the Company (the “Company Common Stock”) will be converted into the right to receive a
certain number or fraction of a number of Parent American Depositary Shares each representing one ordinary share, par value 1/3 p per share, of the Parent (“Parent Ordinary Shares”) or, at the election of the holder of
Company Common Stock, the equivalent number of Parent Ordinary Shares in registered certificated or uncertificated form, upon surrender of the certificate representing such share of Company Common Stock, upon the terms and subject to the conditions
of the Merger Agreement; 
  
 WHEREAS, concurrent with the Merger
Agreement, Parent, the Company and certain stockholders of the Company (the “Voting Agreement Holders”), intend to enter into Stockholder 
  

 1 

 Agreements (the “Stockholder Agreement”), pursuant to which, among other things, the Voting
Agreement Holders will vote in favor of the Merger; 
  
 WHEREAS,
on September 21, 2003, the Board of Directors of the Company resolved to amend the Rights Agreement to exempt the Merger, the Merger Agreement, the Stockholder Agreements and the other transactions specifically contemplated thereby from the
application of the Rights Agreement; and 
  
 WHEREAS, the Company
intends to modify the terms of the Rights Agreement in certain respects as set forth herein, and in connection therewith, is entering into this Amendment and directing the Rights Agent to enter into this Amendment. 
  
 NOW, THEREFORE, for good and valuable consideration, the receipt and adequacy
of which are hereby acknowledged, the parties hereto agree as follows: 

	 	1.	Capitalized Terms. All capitalized, undefined terms used in this Amendment shall have the meanings assigned thereto in the Rights Agreement. 

	 	2.	Amendments. 

  
 (a) Section 1(a) of the Rights Agreement is hereby amended by adding the following new paragraph to the end of Section 1(a): 
  
 “Notwithstanding anything in this Agreement that might otherwise be
deemed to the contrary, neither Bookham Technology plc, nor Budapest Acquisition Corp., nor any of such parties’ Affiliates or Associates shall be deemed to be an Acquiring Person solely by reason of: (i) the approval, execution or delivery of
that certain Agreement and Plan of Merger (the “Merger Agreement”) by and among the Company, Bookham Technology plc, a public limited company incorporated under the laws of England and Wales (the
“Parent”), and Budapest Acquisition Corp., a Delaware corporation and a wholly owned subsidiary of the Parent, pursuant to which the Transitory Subsidiary shall be merged with and into the Company, and the Company shall
continue as the surviving corporation and as a wholly owned subsidiary of Parent (the “Merger”), including any amendment or supplement to the Merger Agreement; or (ii) the consummation of the transactions contemplated
thereby, each upon the terms and subject to the conditions of the Merger Agreement.” 
  
 (b) Section 1(k) of the Rights Agreement is hereby amended by adding the following new paragraph to the end of Section 1(k): 
  
 “Notwithstanding anything in this Agreement that might otherwise be deemed to the contrary, no Distribution Date shall be deemed to have occurred by
reason of: (i) the approval, execution or delivery of the Merger Agreement, including any amendment or supplement thereto, or the stockholder agreements entered into by and among the Parent, the Company and certain of the Company’s stockholders
(the “Stockholder Agreement”) in connection with the execution of the Merger Agreement; or (ii) the consummation of the transactions contemplated thereby, each upon 
  

 2 

 the terms and subject to the conditions of the Merger Agreement, or the Stockholder Agreement, respectively.”

  
 (c) Section 1(q) of the Rights Agreement is hereby amended and
restated in its entirety to read as follows: 
  
 “
“Final Expiration Date” shall mean the earlier to occur of (i) immediately prior to the Effective Time (as defined in the Merger Agreement) and (ii) August 31, 2011.” 
  
 (d) Section 1(nn) of the Rights Agreement is hereby amended by adding the
following new paragraph to the end of Section 1(nn): 
  
 “Notwithstanding anything in this Agreement that might otherwise be deemed to the contrary, no Triggering Event shall be deemed to have occurred by reason of: (i) the approval, execution or delivery of the Merger Agreement, including
any amendment or supplement thereto, or the Stockholder Agreement; or (ii) the consummation of the transactions specifically contemplated thereby, each upon the terms and subject to the conditions of the Merger Agreement.” 
  
 (e) Section 21 of the Rights Agreement is hereby amended and restated in its
entirety to read as follows: 
  
 “Section 21. Change of
Rights Agent. The Rights Agent or any successor Rights Agent may resign and be discharged from its duties under this Agreement upon thirty (30) days’ notice in writing mailed to the Company and to each transfer agent of the Preferred Shares
and the Common Shares by registered or certified mail, and to the holders of the Rights Certificates by first-class mail. In the event the transfer agency relationship in effect between the Company and the Rights Agent terminates, the Rights Agent
will be deemed to resign automatically on the effective date of such termination; and any required notice will be sent by the Company. The Company may remove the Rights Agent or any successor Rights Agent upon thirty (30) days’ notice in
writing, mailed to the Rights Agent or successor Rights Agent, as the case may be, and to each transfer agent of the Preferred Shares and the Common Shares by registered or certified mail, and to the holders of the Rights Certificates by first-class
mail. If the Rights Agent shall resign or be removed or shall otherwise become incapable of acting, the Company shall appoint a successor to the Rights Agent. If the Company shall fail to make such appointment within a period of thirty (30) days
after giving notice of such removal or after it has been notified in writing of such resignation or incapacity by the resigning or incapacitated Rights Agent or by the holder of a Rights Certificate (who shall, with such notice, submit his or her
Rights Certificate for inspection by the Company), then the registered holder of any Rights Certificate may apply to any court of competent jurisdiction for the appointment of a new Rights Agent. Any successor Rights Agent, whether appointed by the
Company or by such a court, shall be a corporation organized and doing business under the laws of the United States or of any state of the United States, in good standing, which is authorized under such laws to exercise corporate trust or
stockholder services powers and is subject to supervision or examination by federal or state authority and which has at the time of its appointment as Rights Agent a combined capital and surplus of at least $100 million. After appointment, the
successor Rights Agent shall be vested with the same powers, rights, duties and responsibilities as if it had been originally named as Rights Agent without further act or deed; but the predecessor Rights Agent 
  

 3 

 shall deliver and transfer to the successor Rights Agent any property at the time held by it hereunder, and execute and
deliver any further assurance, conveyance, act or deed necessary for the purpose. Not later than the effective date of any such appointment, the Company shall file notice thereof in writing with the predecessor Rights Agent and each transfer agent
of the Preferred Shares and the Common Shares, and mail a notice thereof in writing to the registered holders of the Rights Certificates. Failure to give any notice provided for in this Section 21, however, or any defect therein, shall not affect
the legality or validity of the resignation or removal of the Rights Agent or the appointment of the successor Rights Agent, as the case may be.” 
  
 (f) Section 27 of the Rights Agreement is hereby amended by adding the following new paragraph to the end of Section 27: 
  
 “Notwithstanding anything to the contrary contained herein, Rights Agent
shall not be liable for any delays or failures in performance resulting from acts beyond its reasonable control including, without limitation, acts of God, terrorist acts, shortage of supply, breakdowns or malfunctions, interruptions or malfunction
of computer facilities, or loss of data due to power failures or mechanical difficulties with information storage or retrieval systems, labor difficulties, war or civil unrest.” 
  

	3.	Effective Date. This Amendment shall become effective as of the date first above written but such effectiveness is contingent upon the execution and delivery of the Merger
Agreement and/or the Stockholder Agreement by the Company. 

  

	4.	Effect of Amendment. Except as expressly provided herein, the Rights Agreement shall be and remain in full force and effect. 

  

	5.	Governing Law. This Amendment shall be deemed to be a contract made under the laws of the State of Delaware and for all purposes shall be governed by and construed in
accordance with the laws of such State applicable to contracts to be made and performed entirely within such State. 

  

	6.	Counterparts. This Amendment may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such
counterparts shall together constitute but one and the same instrument. 

  

	7.	Certification. The undersigned officer of the Company, being an appropriate officer of the Company and authorized to do so by resolution of the Board of Directors of the
Company duly adopted and approved at a meeting held September 21, 2003, hereby certifies to the Rights Agent that this amendment is in compliance with Section 27 of the Rights Agreement. 

  
  

 4 

 IN WITNESS WHEREOF, the Company and the Rights Agent have caused this Amendment to be duly executed as of
the day first above written. 
  
  

	NEW FOCUS, INC.
		
	By:	 	 /s/ WILLIAM L. POTTS, Jr.

	 	

	 	 	 Name: William L. Potts, Jr.

	 	 	 Title:    Chief Financial Officer and Secretary

  
  
  

	EQUISERVE TRUST COMPANY, N.A.
		
	By:	 	 /s/ CAROL MULVEY-EORI

	 	

	 	 	 Name: Carol Mulvey-Eori

	 	 	 Title:   Managing Director

  
  

 5

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