Document:

Exhibit

KEY EMPLOYEE RETENTION AGREEMENT

THIS KEY EMPLOYEE RETENTION AGREEMENT (this “Agreement”), dated this 12th day of June, 2017 (the “Effective Date”), is entered into by and between Southside Bank (the “Bank”) and Hilliard J. Shands, III (“Employee”).  For purposes of this Agreement, the Bank and Employee are referred to collectively as the “parties.”  

RECITALS

Southside Bancshares, Inc. (the “Company,” and collectively with the Bank, “Southside”) and Diboll State Bancshares, Inc. (“Target”) have entered into an Agreement and Plan of Merger dated as of June 12, 2017 (the “Merger Agreement”), pursuant to which Target will be acquired by and be merged with and into the Company (the “Merger”).

Employee is currently employed by Target as President and CEO.

Following the Merger, the Bank desires to employ Employee as East Texas Regional President, and Employee desires to continue employment subject to the agreements and covenants of this Agreement. 

Effective as of the consummation of the Merger (the “Merger Effective Date”), Employee and the Bank desire to enter into a retention arrangement as set forth herein.

The parties acknowledge and agree that if the Merger Effective Date shall not occur, then this Agreement shall be deemed void and of no effect.

In consideration of the payments, consents and acknowledgements described below, and in consideration of other good and valuable consideration, the receipt and sufficiency of all of which is hereby acknowledged, the Bank and Employee agree as follows:

1.    Recitals Included.  The above recitals are incorporated herein and made a part hereof.

2.    Release and Covenant Not to Sue.    

(a)    Release and Covenant Not to Sue.  Employee, with the intention of binding himself and all of his heirs, executors, administrators and assigns, waives, releases and forever discharges the Company, the Bank, Target and all of their past and present officers, directors, stockholders, employees, agents, parent corporations, predecessors, subsidiaries, affiliates, estates, successors, assigns, partners and attorneys (collectively, the “Releasees”) from any and all claims arising on or before the Merger Effective Date, in law or in equity, whether known or unknown, suspected or unsuspected, which Employee, now has, owns or holds or has at any time heretofore ever had, owned or held against the Releasees.  This Release includes, but is not limited to, claims arising under federal, state or local laws prohibiting employment discrimination; claims arising under severance plans and contracts; and claims growing out of any legal restrictions on the Releasees’ rights to terminate their employees or to take any other employment action, whether statutory, contractual or arising under common law or case law.  Employee specifically acknowledges and agrees that he is releasing any and all rights under federal, state and local employment laws including without limitation the Age Discrimination in Employment Act (“ADEA”), Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 1981, the Americans With Disabilities Act (“ADA”), the Family and Medical Leave Act (“FMLA”), the Genetic Information Nondiscrimination Act (“GINA”), the Employee Retirement Income Security Act (“ERISA”), the Equal Pay Act (“EPA”), the Occupational Safety and Health Act (“OSHA”), and any and all other local, state, and federal law claims arising under statute or common law.  Except as expressly set forth below, Employee further hereby AGREES NOT TO FILE A LAWSUIT or other legal claim or charge to assert against any of the Releasees any claim released by this Agreement.  It is agreed that this is a general release and it is to be broadly construed as a release of all claims, except those that cannot be released by law.  By signing this Agreement, Employee acknowledges that he is doing so knowingly and voluntarily, that he understands that he may be releasing claims he may not know about, and that he is waiving all rights he may have had under any law that is intended to protect him from waiving unknown claims.  This Agreement shall not in any way be construed as an admission by any of the Releasees of wrongdoing or liability or that Employee 

has any rights against any of the Releasees.  Notwithstanding anything contained in this Agreement to the contrary, this Agreement does not constitute a release nor a waiver of any of the following claims: (i) claims pursuant to the terms and conditions of the federal law known as COBRA or similar state law; (ii) claims for indemnity under any indemnification agreement with the Company or under its organizational documents, as provided by applicable state law or under any applicable insurance policy with respect to the Employee’s liability as an employee, director or officer of the Company or its affiliates; and (iii) claims the Employee may have as an employee participating in the Company’s 401(k) plan.

(b)    Protected Rights. Employee understands that nothing contained in this Agreement limits Employee’s ability to file a charge or complaint with the Equal Employment Opportunity Commission, the National Labor Relations Board, the Securities and Exchange Commission or any other federal, state or local governmental agency or commission (“Government Agencies”).  Employee further understands that this Agreement does not limit Employee’s ability to communicate or share information with any Government Agencies, report possible violations of law to any Government Agency, otherwise participate in any investigation or proceeding that may be conducted by any Government Agencies, or make other disclosures that are protected by any whistleblower protection laws.  Employee does not need prior authorization to make such reports or disclosures and is not required to notify the Company or the Bank that he/she has made any such report or disclosure.  However, based on Employee’s release of claims set forth in Section 2 of this Agreement, Employee understands that Employee is releasing all claims and causes of action that Employee might personally pursue or that might be pursued in Employee’s name and, to the extent permitted by applicable law, Employee’s right to recover monetary damages or obtain injunctive relief that is personal to Employee in connection with such claims and causes of action, though nothing in this Agreement shall prohibit Employee from receiving an award or monetary recovery pursuant to the Securities and Exchange Commission’s whistleblower program.  

3.    Equity Grants and Retention Arrangements.  

(a)    Equity Grants.  Within 60 days following the Merger Effective Date, the Company will grant to Employee equity incentive awards consisting of (i) non-qualified stock options to purchase shares of the Company’s common stock having a value approximately equal to 12.5% of Employee’s base salary as of the Merger Effective Date (based on Black-Scholes option modeling), which stock options will have an exercise price equal to the closing price of the Company’s common stock on the date of grant, will vest in four equal installments on the first four anniversaries of the grant date, and will have a ten-year term; and (ii) restricted stock units having a value approximately equal to 12.5% of Employee’s base salary as of the Merger Effective Date (based on the closing price of the Company’s common stock on the Merger Effective Date, each representing the right to receive a share of the Company’s common stock, which will vest in four equal installments on the first four anniversaries of the grant date.

(b)    Retention Payments. 

(i)    Subject to (A) Employee’s continuing employment with the Bank through the First Retention Payment Date (as defined below), and (B) continuing to perform his/her job duties to the reasonable satisfaction of the Bank through the First Retention Payment Date, the Bank will pay to Employee a cash retention award of One Hundred Sixteen Thousand, Two Hundred Fifty Dollars ($116,250), less withholding for taxes and other similar items (the “First Retention Payment”).  The First Retention Payment will be paid to Employee in a single lump sum payment on the first regular payroll date following the 90th day after the Merger Effective Date (the “First Retention Payment Date”), provided that on the First Retention Payment Date Employee remains employed in good standing by the Bank.

(ii)    Subject to (A) Employee’s continuing employment with the Bank through the Second Retention Payment Date (as defined below), and (B) continuing to perform his/her job duties to the reasonable satisfaction of the Bank through the Second Retention Payment Date, the Bank will pay to Employee a cash retention award of One Hundred Sixteen Thousand, Two Hundred Fifty Dollars ($116,250), less withholding for taxes and other similar items (the “Second Retention Payment”).  The Second Retention Payment will be paid to Employee in a single lump sum payment on the first regular payroll date following the first anniversary of the Merger Effective Date (the 

“Second Retention Payment Date”), provided that on the Second Retention Payment Date Employee remains employed in good standing by the Bank.

(iii)    Subject to (A) Employee’s continuing employment with the Bank through the Third Retention Payment Date (as defined below), and (B) continuing to perform his/her job duties to the reasonable satisfaction of the Bank through the Third Retention Payment Date, the Bank will pay to Employee a cash retention award of Forty-Eight Thousand Dollars ($48,000), less withholding for taxes and other similar items (the “Third Retention Payment”).  The Third Retention Payment will be paid to Employee in a single lump sum payment on the first regular payroll date following the second anniversary of the Merger Effective Date (the “Third Retention Payment Date”), provided that on the Third Retention Payment Date Employee remains employed in good standing by the Bank.

(iv)    Notwithstanding anything in the Agreement to the contrary, if the Bank terminates Employee’s employment other than for Cause or Disability (each as defined herein) (a “Qualifying Termination”) (A) prior the First Retention Payment Date, then the Bank shall pay to Employee an amount equal to the sum of the First Retention Payment and the Second Retention Payment, (B) after the First Retention Payment Date but prior to the Second Retention Payment Date, then the Bank shall pay to Employee an amount equal to the Second Retention Payment, or (C) after the Second Retention Payment Date but prior to the Third Retention Payment Date, then the Bank shall pay to Employee an amount equal to the Third Retention Payment, in each case in a single lump sum within sixty (60) days following Employee’s date of termination.  Notwithstanding the foregoing, the Bank shall be obligated to provide a payment described in this Section 3(b)(iv) only if (A) within forty-five (45) days after the date of termination, Employee shall have executed a full general release of claims and covenant not to sue in the reasonable form provided by the Company (the “Release Agreement”) and such Release Agreement shall not have been revoked within any revocation period specified in the Release Agreement, and (B) subject to the following sentence, Employee fully complies with the Protective Covenants (as defined herein).  Notwithstanding anything the contrary herein, in the event of a Qualifying Termination within two (2) years after the Merger Effective Date, the Employee shall have no obligation to comply with the obligations set forth in Section 7 of this Agreement.  The payments set forth in this Section 3 shall be in addition to, and not in lieu of, any other severance or similar payments to which Employee may be entitled pursuant to other plans or polices of the Bank or otherwise, including, without limitation, the Severance Pay Plan of First Bank & Trust East Texas, Diboll, Texas. 

(v)    For purposes of this Agreement, “Cause” shall mean a good faith determination by the Bank that any of the following has occurred:

(A) Employee’s material or habitual failure to follow the reasonable and lawful directions of the Bank, or perform his duties with the Bank (other than any such failure resulting from Employee’s Disability) which failure is not cured within ten (10) days after a written demand for performance is delivered to Employee by the Bank which specifically identifies the manner in which the Bank believes that Employee has materially or habitually failed to perform Employee’s duties;

(B) Employee’s charge with, indictment for, conviction of, or entry of a plea of guilty or nolo contendere or no contest with respect to: (1) any felony, or any misdemeanor involving dishonesty or moral turpitude (including pleading guilty or nolo contendere to a felony or lesser charge which results from plea bargaining), whether or not such felony, crime or lesser offense is connected with the business of the Bank, or (2) any crime connected with the business of the Bank;

(C) any intentional misconduct by Employee in connection with the Bank’s business or relating to Employee’s duties, or any willful violation of any laws, rules or regulations applicable to banks or the banking industry generally (including but not limited to the regulations of the Board of Governors of the Federal Reserve, the Federal Deposit Insurance Corporation (the “FDIC”), or any other applicable regulatory authority);

(D) Employee’s commission of or engagement in any act of fraud, misappropriation, dishonesty, or embezzlement, whether or not such act was committed in connection with the business of the Bank;

(E) Employee’s breach of fiduciary duty, breach or threatened breach of any of the Protective Covenants (as defined herein), or material breach of any other provisions of this Agreement; or

(F) Employee’s violation of the Bank’s policy against harassment, its equal employment opportunity policy, or any code of business conduct or corporate governance policies adopted by the Bank, or a material violation of any other policy or procedure of the Bank.

(vi)    For purposes of this Agreement, “Disability” shall mean the inability of Employee, as reasonably determined by the Bank, to perform the essential functions of his regular duties and responsibilities, with or without reasonable accommodation, due to a medically determinable physical or mental illness which has lasted (or can reasonably be expected to last) for a period of six (6) consecutive months.  

4.    Acknowledgments Regarding Protective Covenants.  

(a)    Condition of Employment and Other Consideration.  Employee acknowledges and agrees that he/she has received good and valuable consideration for entering into this Agreement, including, without limitation, access to and use of the Bank’s Confidential Information and access to the Bank’s customer and employee relationships and goodwill, and further acknowledges that the Bank would not employ or continue to employ Employee in the absence of his/her execution of and compliance with this Agreement.

(b)    Access to Confidential Information, Relationships, and Goodwill.  In exchange for Employee’s promises contained in this Agreement, the Bank hereby agrees that during Employee’s employment with the Bank, the Bank will provide Employee access to its Confidential Information (as defined herein), customer and employee relationships, and goodwill.  Employee acknowledges and agrees that he/she is being provided and entrusted with Confidential Information, including highly confidential customer information that is subject to extensive measures to maintain its secrecy within the Bank, is not known in the trade or disclosed to the public, and would materially harm the Bank’s legitimate business interests if it was disclosed or used in violation of this Agreement.  Employee also acknowledges and agrees that he/she is being provided and entrusted with access to the Bank’s customer and employee relationships and goodwill.  Employee further acknowledges and agrees that the Bank would not provide access to the Confidential Information, customer and employee relationships, and goodwill in the absence of Employee’s execution of and compliance with this Agreement.  Employee further acknowledges and agrees that the Bank’s Confidential Information, customer and employee relationships, and goodwill are valuable assets of the Bank and are legitimate business interests that are properly subject to protection through the covenants contained in this Agreement.

(c)    Potential Unfair Competition.  Employee acknowledges and agrees that as a result of his/her employment with the Bank, his/her knowledge of and access to Confidential Information, and his/her relationships with the Bank’s customers and employees, Employee would have an unfair competitive advantage if Employee were to engage in activities in violation of this Agreement.

(d)    No Undue Hardship.  Employee acknowledges and agrees that, in the event that his/her employment with the Bank terminates, Employee possesses marketable skills and abilities that will enable Employee to find suitable employment without violating the covenants set forth in this Agreement.

(e)    Voluntary Execution.  Employee acknowledges and affirms that he/she is executing this Agreement voluntarily, that he/she has read this Agreement carefully and had a full and reasonable opportunity to consider this Agreement (including an opportunity to consult with legal counsel), and that he/she has not been pressured or in any way coerced, threatened or intimidated into signing this Agreement.
    
5.    Definitions.  The following capitalized terms used in this Agreement shall have the meanings assigned to them below, which definitions shall apply to both the singular and the plural forms of such terms:

(a)    “Competitive Services” means engaging in the business of community banking or commercial banking, including, without limitation, originating, underwriting, closing and/or selling loans, receiving deposits and/or otherwise engaging in the business of banking. 

(b)    “Confidential Information” means any and all data and information relating to Southside, its activities, business, or clients that (i) is disclosed to Employee or of which Employee becomes aware as a consequence of his employment with the Bank; (ii) has value to Southside; and (iii) is not generally known outside of Southside.  “Confidential Information” shall include, but is not limited to the following types of information regarding, related to, or concerning Southside: trade secrets (as defined by applicable law); financial plans and data; management planning information; business plans; operational methods; market studies; marketing plans or strategies; pricing information; product development techniques or plans; customer lists; customer files, data and financial information; details of customer contracts; current and anticipated customer requirements; identifying and other information pertaining to business referral sources; past, current and planned research and development; computer aided systems, software, strategies and programs; business acquisition plans; management organization and related information (including, without limitation, data and other information concerning the compensation and benefits paid to officers, directors, employees and management); personnel and compensation policies; new personnel acquisition plans; and other similar information.  “Confidential Information” also includes combinations of information or materials which individually may be generally known outside of Southside, but for which the nature, method, or procedure for combining such information or materials is not generally known outside of Southside.  In addition to data and information relating to Southside, “Confidential Information” also includes any and all data and information relating to or concerning a third party that otherwise meets the definition set forth above, that was provided or made available to Southside by such third party, and that Southside has a duty or obligation to keep confidential.  This definition shall not limit any definition of “confidential information” or any equivalent term under state or federal law.  “Confidential Information” shall not include information that has become generally available to the public by the act of one who has the right to disclose such information without violating any right or privilege of Southside.

(c)    “Material Contact” means (i) having dealings with a customer or potential customer on behalf of Southside; (ii) coordinating or supervising dealings with a customer or potential customer on behalf of Southside; (iii) obtaining Confidential Information about a customer or potential customer in the ordinary course of business as a result of Employee’s employment with the Bank; or (iv) receiving compensation, commissions, or earnings within the two (2) years prior to the Termination Date that resulted from the sale or provision of products or services of the Bank to a customer.

(d)    “Person” means any individual or any corporation, partnership, joint venture, limited liability company, association or other entity or enterprise.

(e)    “Principal or Representative” means a principal, owner, partner, shareholder, joint venturer, investor, member, trustee, director, officer, manager, employee, agent, representative or consultant.

(f)    “Protected Customer” means any Person to whom Southside has sold or provided its products or services or actively solicited to sell its products or services, and with whom Employee has had Material Contact on behalf of Southside during his/her employment with the Bank.

(g)    “Restricted Period” means any time during Employee’s employment with the Bank, as well as one (1) year from Employee’s Termination Date.

(h)    “Protective Covenants” means the protective covenants contained in Sections 6 through 9 hereof.

(i)    “Termination” means the termination of Employee’s employment with the Bank, for any reason, whether with or without cause, upon the initiative of either party.

(j)    “Termination Date” means the date of Employee’s Termination.

6.    Restriction on Disclosure and Use of Confidential Information.  

(a)    Protection of Confidential Information.  Employee agrees that Employee shall not, directly or indirectly, use any Confidential Information on Employee’s own behalf or on behalf of any Person other than Southside, or reveal, divulge, or disclose any Confidential Information to any Person not expressly authorized by Southside to receive such Confidential Information.  This obligation shall remain in effect for as long as the information or materials in question retain their status as Confidential Information.  Employee further agrees that he/she shall fully cooperate with Southside in maintaining the Confidential Information to the extent permitted by law. The parties acknowledge and agree that this Agreement is not intended to, and does not, alter either Southside’s rights or Employee’s obligations under any state or federal statutory or common law regarding trade secrets and unfair trade practices.  

(b)    Confidentiality of Agreement.  Employee and the Bank acknowledge that the terms of this Agreement must be kept confidential.  Accordingly, except as required by Section 12 hereof, Employee agrees not to disclose or publish, verbally, in writing or otherwise, to any person or entity, except his spouse, his legal and tax advisors, or as required by law, any of the details leading up to the making of this Agreement, the terms and conditions or sums being paid in connection with this Agreement, or whether the terms of the Agreement are satisfactory in his opinion.

(c)    Exclusions.  Anything herein to the contrary notwithstanding, Employee shall not be restricted from: (i) disclosing information that is required to be disclosed by law, court order or other valid and appropriate legal process; provided, however, that in the event such disclosure is required by law, Employee shall provide Southside with prompt notice of such requirement so that Southside may seek an appropriate protective order prior to any such required disclosure by Employee; (ii) reporting possible violations of federal, state, or local law or regulation to any governmental agency or entity, or from making other disclosures that are protected under the whistleblower provisions of federal, state, or local law or regulation, and Employee shall not need the prior authorization of Southside to make any such reports or disclosures and shall not be required to notify Southside that Employee has made such reports or disclosures; (iii) disclosing a trade secret (as defined by 18 U.S.C. § 1839) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney, in either event solely for the purpose of reporting or investigating a suspected violation of law; or (iv) disclosing a trade secret (as defined by 18 U.S.C. § 1839) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal.
    
7.    Non-Solicitation of Protected Customers.  Employee agrees that, during the Restricted Period, he/she shall not, without the prior written consent of Southside, directly or indirectly, on his/her own behalf or as a Principal or Representative of any Person, solicit, divert, take away, or attempt to solicit, divert, or take away a Protected Customer for the purpose of engaging in, providing, or selling Competitive Services.  

8.    Non-Recruitment of Employees and Independent Contractors.  Employee agrees that during the Restricted Period, he/she shall not, directly or indirectly, whether on his/her own behalf or as a Principal or Representative of any Person, recruit, solicit, or induce or attempt to recruit, solicit or induce any employee or independent contractor of Southside to terminate his/her employment or other relationship with Southside or to enter into employment or any other kind of business relationship with the Employee or any other Person.

9.    Return of Materials.  Employee agrees that he/she will not retain or destroy (except as set forth below), and will immediately return to the Bank on or prior to the Termination Date, or at any other time the Bank requests such return, any and all property of Southside that is in his/her possession or subject to his/her control, including, but not limited to, customer files and information, papers, drawings, notes, manuals, specifications, designs, devices, code, email, documents, diskettes, CDs, tapes, keys, access cards, credit cards, identification cards, equipment, computers, mobile devices, other electronic media, all other files and documents relating to Southside and its business (regardless of form, but specifically including all electronic files and data of Southside), together with all Confidential Information belonging to Southside or that Employee received from or through his/her employment with the Bank.  Employee will not make, distribute, or retain copies of any such information or property.  To the extent that Employee has electronic files or information in his/her possession or control that belong to Southside and/or contain Confidential Information (specifically including but not limited to electronic files or information stored on personal computers, mobile devices, electronic media, or in cloud storage), on or prior to the Termination Date, or at any other time the Bank requests, Employee shall (a) provide the Bank with an electronic copy of all of such files or information (in an electronic format that readily accessible by the Bank); (b) after doing so, delete all such files and information, including all copies and 

derivatives thereof, from all non-Southside-owned computers, mobile devices, electronic media, cloud storage, and other media, devices, and equipment, such that such files and information are permanently deleted and irretrievable; and (c) provide a written certification to the Bank that the required deletions have been completed and specifying the files and information deleted and the media source from which they were deleted.  Employee agrees that he/she will reimburse Southside for all of its costs, including reasonable attorneys’ fees, of recovering the above materials and otherwise enforcing compliance with this provision if he/she does not return the materials to the Bank or take the required steps with respect to electronic information or files on or prior to the Termination Date or at any other time the materials and/or electronic file actions are requested by the Bank or if Employee otherwise fails to comply with this provision.

10.    Enforcement of Protective Covenants.
    
(a)    Rights and Remedies Upon Breach.  The parties specifically acknowledge and agree that the remedy at law for any breach of the Protective Covenants will be inadequate, and that in the event Employee breaches, or threatens to breach, any of the Protective Covenants, Southside shall have the right and remedy, without the necessity of proving actual damage or posting any bond, to enjoin, preliminarily and permanently, Employee from violating or threatening to violate the Protective Covenants and to have the Protective Covenants specifically enforced by any court of competent jurisdiction, it being agreed that any breach or threatened breach of the Protective Covenants would cause irreparable injury to Southside and that money damages would not provide an adequate remedy to Southside.  Employee understands and agrees that if he violates any of the obligations set forth in the Protective Covenants, the period of restriction applicable to each obligation violated shall cease to run during the pendency of any litigation over such violation, provided that such litigation was initiated during the period of restriction.  Such rights and remedies shall be in addition to, and not in lieu of, any other rights and remedies available to Southside at law or in equity.  Employee understands and agrees that if the parties become involved in legal action regarding the enforcement of the Protective Covenants, the prevailing party will be entitled, in addition to any other remedy, to recover its reasonable costs and attorneys’ fees incurred in such action from the other party.  Southside’s ability to enforce its rights under the Protective Covenants or applicable law against Employee shall not be impaired in any way by the existence of a claim or cause of action on the part of Employee based on, or arising out of, this Agreement or any other event or transaction. 

(b)    Severability and Modification of Covenants.  Employee acknowledges and agrees that each of the Protective Covenants is reasonable and valid in time and scope and in all other respects.  The parties agree that it is their intention that the Protective Covenants be enforced in accordance with their terms to the maximum extent permitted by law.  Each of the Protective Covenants shall be considered and construed as a separate and independent covenant.  Should any part or provision of any of the Protective Covenants be held invalid, void, or unenforceable, such invalidity, voidness, or unenforceability shall not render invalid, void, or unenforceable any other part or provision of this Agreement or such Restrictive Covenant.  If any of the provisions of the Protective Covenants should ever be held by a court of competent jurisdiction to exceed the scope permitted by the applicable law, such provision or provisions shall be automatically modified to such lesser scope as such court may deem just and proper for the reasonable protection of Southside’s legitimate business interests and may be enforced by Southside to that extent in the manner described above and all other provisions of this Agreement shall be valid and enforceable.

11.    Existing Covenants.  Employee represents and warrants that his/her employment with Bank does not and will not breach any agreement that Employee has with any former employer to keep in confidence proprietary or confidential information or not to compete with any such former employer.  Employee will not disclose to Southside or use on its behalf any proprietary or confidential information of any other party required to be kept confidential by Employee.

12.    Disclosure of Agreement.  Employee acknowledges and agrees that, during the Restricted Period, he will disclose the existence and terms of Sections 4 through 10 this Agreement to any prospective employer, business partner, investor or lender prior to entering into an employment, partnership or other business relationship with such prospective employer, business partner, investor or lender.  Employee further agrees that Southside shall have the right to make any such prospective employer, business partner, investor or lender of Employee aware of the existence and terms of this Agreement.

13.    Employment Status.  Nothing in this Agreement shall be construed as a commitment, guarantee, agreement, or understanding of any kind or nature that the Bank will continue to employ Employee, nor will this Agreement affect in any way the right of the Bank to terminate Employee’s employment at any time and for any reason (unless otherwise agreed to by the parties separately in writing).  Employee acknowledges and agrees that he is an “at will” employee.

14.    Code Section 409A.  This Agreement shall be interpreted and administered in a manner so that any amount or benefit payable hereunder shall be paid or provided in a manner that is either exempt from or compliant with the requirements Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) and applicable Internal Revenue Service guidance and Treasury Regulations issued thereunder. Nevertheless, the tax treatment of the benefits provided under the Agreement is not warranted or guaranteed.  Neither the Company, the Bank nor their directors, officers, employees or advisers shall be held liable for any taxes, interest, penalties or other monetary amounts owed by Employee as a result of the application of Section 409A of the Code.

15.    Limitation of Benefits.

(a)    Notwithstanding anything in this Agreement to the contrary, in the event it shall be determined that any benefit, payment or distribution by Southside to or for the benefit of Employee (whether payable or distributable pursuant to the terms of this Agreement or otherwise) (such benefits, payments or distributions are hereinafter referred to as “Payments”) would, if paid, be subject to the excise tax (the “Excise Tax”) imposed by Section 4999 of the Code, then the aggregate present value of the Payments shall be reduced (but not below zero) to an amount expressed in present value that maximizes the aggregate present value of the Payments without causing the Payments or any part thereof to be subject to the Excise Tax and therefore nondeductible by Southside because of Section 280G of the Code (the “Reduced Amount”).  The reduction of the Payments due hereunder, if applicable, shall be made by first reducing cash Payments and then, to the extent necessary, reducing those Payments having the next highest ratio of Parachute Value to actual present value of such Payments as of the date of the change of control, as determined by the Determination Firm (as defined in Section 15(b) below).  For purposes of this Section 15, present value shall be determined in accordance with Section 280G(d)(4) of the Code.  For purposes of this Section 15, the “Parachute Value” of a Payment means the present value as of the date of the change of control of the portion of such Payment that constitutes a “parachute payment” under Section 280G(b)(2) of the Code, as determined by the Determination Firm for purposes of determining whether and to what extent the Excise Tax will apply to such Payment.  

(b)    All determinations required to be made under this Section 15, including whether an Excise Tax would otherwise be imposed, whether the Payments shall be reduced, the amount of the Reduced Amount, and the assumptions to be utilized in arriving at such determinations, shall be made by an independent, nationally recognized accounting firm or compensation consulting firm mutually acceptable to Southside and Employee (the “Determination Firm”) which shall provide detailed supporting calculations both to Southside and Employee within 15 business days of the receipt of notice from Employee that a Payment is due to be made, or such earlier time as is requested by Southside.  All fees and expenses of the Determination Firm shall be borne solely by Southside.  Any determination by the Determination Firm shall be binding upon Southside and Employee.  As a result of the uncertainty in the application of Section 4999 of the Code at the time of the initial determination by the Determination Firm hereunder, it is possible that Payments hereunder will have been unnecessarily limited by this Section 15 (“Underpayment”), consistent with the calculations required to be made hereunder.  The Determination Firm shall determine the amount of the Underpayment that has occurred and any such Underpayment shall be promptly paid by Southside to or for the benefit of Employee together with interest at the applicable Federal rate provided for in Section 7872(f)(2) of the Code, but no later than March 15 of the year after the year in which the Underpayment is determined to exist, which is when the legally binding right to such Underpayment arises.  

16.    Miscellaneous.
(a)    Applicable Law; Forum Selection; Consent to Jurisdiction.  The Bank and Employee agree that this Agreement shall be governed by and construed and interpreted in accordance with the laws of the State of Texas without giving effect to its conflicts of law principles.  Employee agrees that the exclusive forum for any action to enforce this Agreement, as well as any action relating to or arising out of this Agreement, shall be the state or federal 

courts of the State of Texas.  With respect to any such court action, Employee hereby (i) irrevocably submits to the personal jurisdiction of such courts; (ii) consents to service of process; (iii) consents to venue; and (iv) waives any other requirement (whether imposed by statute, rule of court, or otherwise) with respect to personal jurisdiction, service of process, or venue.  The parties hereto further agree that the state and federal courts of the State of Texas are convenient forums for any dispute that may arise herefrom and that neither party shall raise as a defense that such courts are not convenient forums.

(b)    Severability.  The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement.

(c)    Waiver.  Failure of either party to insist, in one or more instances, on performance by the other in strict accordance with the terms and conditions of this Agreement shall not be deemed a waiver or relinquishment of any right granted in this Agreement or of the future performance of any such term or condition or of any other term or condition of this Agreement, unless such waiver is contained in a writing signed by the party making the waiver.

(d)    Entire Agreement; Amendment.  Except as otherwise provided herein, this Agreement contains the entire agreement between the Bank and Employee with respect to the subject matter hereof and, from and after the date hereof, this Agreement shall supersede any other agreement, written or oral, between the parties relating to the subject matter of this Agreement.  This Agreement may not be amended or modified otherwise than by a written agreement executed by the parties hereto or their respective successors and legal representatives.  

(e)    Assignment.  This Agreement can be assigned by the Bank and shall be binding and inure to the benefit of the Bank, its successors and assigns.  No right, obligation or duty of this Agreement may be assigned by Employee without the prior written consent of the Bank.

(f)     Construction. The parties understand and agree that because each of them has been given the opportunity to have counsel review and revise this Agreement, the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this Agreement. Instead, the language of all parts of this Agreement shall be construed as a whole, and according to its fair meaning, and not strictly for or against any of the parties.

(g)    Counterparts.  This Agreement may be executed in two or more counterparts, and it shall not be necessary that the signatures of the parties hereto be contained on any one counterpart hereof.  Each counterpart shall be deemed an original but all counterparts together shall constitute one and the same instrument.  Any signature page of any such counterpart, or any electronic facsimile thereof, may be attached or appended to any other counterpart to complete a fully executed counterpart of this Agreement, and any telecopy or other electronic transmission of any signature shall be deemed an original and shall bind such Party.

(h)    Taxes.  The Bank may withhold from any amounts payable under this Agreement such Federal, state, local or foreign taxes as shall be required to be withheld pursuant to any applicable law or regulation.  

(i)    Third Party Beneficiary.  The parties acknowledge and agree that the Company is an intended third-party beneficiary of this Agreement and may enforce the Bank’s rights hereunder.

(Signatures on following page)

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date set forth above, to be effective immediately.
            

	
			
	 
	 
	SOUTHSIDE BANK

	 
	 
	 

	 
	By:
	/s/ Lee R. Gibson

	 
	 
	Lee R. Gibson

	 
	 
	President and CEO

	 
	 
	 

	 
	 
	EMPLOYEE

	 
	 
	 

	 
	By:
	/s/ H.J. Shands, III

	 
	 
	Hilliard J. Shands, IIIEX-10.1

 Exhibit 10.1 

Execution Version 
  

 
 FIRST AMENDMENT TO TERM LOAN
CREDIT AGREEMENT 
 dated as of 

November 30, 2017, 

among 
 INSTALLED
BUILDINGS PRODUCTS, INC., 
 as the Borrower, 

the other Loan Parties party hereto, the Participating Lenders and Fronting Bank party hereto, 

and 
 ROYAL BANK OF
CANADA, 
 as Administrative Agent 
  

 
 RBC CAPITAL
MARKETS1, 
 as Lead Arranger and Bookrunner 

 
  

 

	1 	RBC Capital Markets is a brand name for the capital markets businesses of Royal Bank of Canada and its affiliates. 

 FIRST AMENDMENT TO TERM LOAN CREDIT AGREEMENT 

This FIRST AMENDMENT TO TERM LOAN CREDIT AGREEMENT, dated as of November 30, 2017 (this “Amendment”), among Installed
Building Products, Inc., a Delaware corporation (the “Borrower”), ROYAL BANK OF CANADA (“RBC”), as administrative agent (in such capacity, the “Administrative Agent”) under the Credit Agreement
referred to below, and each Repricing Participating Lender (as defined below) party hereto. 
 RECITALS: 

WHEREAS, reference is made to the Term Loan Credit Agreement, dated as of April 13, 2017 (as amended, restated, amended and
restated, supplemented or otherwise modified from time to time prior to the date hereof, the “Existing Credit Agreement” and as may be further amended, restated, amended and restated, supplemented or otherwise modified from time to
time, including by this Amendment, the “Credit Agreement”), among the Borrower, the lenders or other financial institutions or entities from time to time party thereto and the Administrative Agent (capitalized terms used but not
defined herein having the meaning provided in the Credit Agreement), pursuant to which the Lenders provided the Borrower with Initial Term Loans in an aggregate initial principal amount of $300,000,000 (the “Initial Term Loans”);

 WHEREAS, this Amendment constitutes a Refinancing Amendment, and the Borrower is hereby notifying the Administrative Agent that
it is requesting the establishment of Other Term Loans pursuant to Section 2.21 of the Existing Credit Agreement; 
 WHEREAS,
the Borrower requests Other Term Loans and Other Term Commitments in an aggregate principal amount of $299,250,000 (the “Tranche B-1 Term Loans”; the Other Term Commitments in respect of such
Tranche B-1 Term Loans, the “Tranche B-1 Term Commitments”; and the Repricing Participating Lenders with Tranche
B-1 Term Commitments and any permitted assignees thereof, the “Tranche B-1 Term Loan Lenders”), which will be available on the First Amendment Effective
Date (as defined below) to refinance all Initial Term Loans outstanding under the Existing Credit Agreement immediately prior to effectiveness of this Amendment (the “Existing Term Loans”) and which Tranche B-1 Term Loans shall constitute Other Term Loans and Term Loans (as applicable) for all purposes of the Credit Agreement and the other Loan Documents; 

WHEREAS, each Lender holding Existing Term Loans under the Existing Credit Agreement immediately prior to effectiveness of this
Amendment (each, an “Existing Term Lender”) executing and delivering a notice of participation in the Tranche B-1 Term Loans in the form attached as Exhibit A hereto (a “Tranche
B-1 Participation Notice”) and electing the cashless settlement option therein (each such Existing Term Lender in such capacity and with respect to the Existing Term Loans so elected, a
“Converting Lender” and, together with each other Person executing and delivering a Tranche B-1 Participation Notice or otherwise providing a Tranche
B-1 Term Commitment, the “Repricing Participating Lenders”) shall be deemed to have exchanged on the First Amendment Effective Date the aggregate outstanding principal amount of its Initial
Term Loans under the Existing Credit Agreement exchanged pursuant to this Amendment for an equal aggregate principal amount of Tranche B-1 Term Loans under the Credit Agreement; 

WHEREAS, RBC agrees to act as fronting bank for the syndication of the Tranche B-1 Term Loans
(in such capacity, the “Fronting Bank”), and the Fronting Bank will purchase, and the Existing Term Lenders that execute and deliver a Tranche B-1 Participation Notice and elect the cash
settlement option therein (the “Non-Converting Lenders”) will sell to the Fronting Bank, immediately prior to effectiveness of this Amendment, the Initial Term Loans then held by the Non-Converting Lenders (the Term Loans described in this recital, the “Participating Cash Settlement Term Loans”); 

  
 2 

 WHEREAS, the Fronting Bank will fund, on the First Amendment Effective Date, an aggregate
principal amount of Tranche B-1 Term Loans equal to the aggregate outstanding principal amount of the Initial Term Loans of Existing Term Lenders that do not execute and deliver a Tranche B-1 Participation Notice (the “Non-Participating Lenders”), the proceeds of which shall be used on the First Amendment Effective Date to refinance such
outstanding Initial Term Loans of the Non-Participating Lenders (the Term Loans described in this recital, the “Non-Participating Cash Settlement Term
Loans” and, together with the Participating Cash Settlement Term Loans, the “Reallocated Term Loans”); 

WHEREAS, (a) to the extent there exist (1) any Participating Cash Settlement Term Loans, the Fronting Bank shall be deemed
to exchange on the First Amendment Effective Date such Reallocated Term Loans on a cashless settlement basis for an equal aggregate principal amount of Tranche B-1 Term Loans under the Credit Agreement and
(2) any Non-Participating Cash Settlement Term Loans, the Fronting Bank shall apply on the First Amendment Effective Date proceeds of Tranche B-1 Term Loans in an
aggregate amount equal to the aggregate amount of such Non-Participating Cash Settlement Term Loans to the repayment of such Non-Participating Cash Settlement Term Loans
and (b) the Tranche B-1 Term Loans exchanged for or applied to the repayment of such Reallocated Term Loans shall promptly (but not later than 30 days following the First Amendment Effective Date (or such
later date as may be agreed to by the Fronting Bank in its sole discretion)) thereafter be purchased by Repricing Participating Lenders (other than Existing Term Lenders) (the “New Lenders”),
Non-Converting Lenders, and Existing Term Lenders that have elected to purchase additional Tranche B-1 Term Loans, each in accordance with such Participating
Lenders’ respective Tranche B-1 Participation Notice and as allocated by RBC Capital Markets in its capacity as a Lead Arranger (as defined below) hereunder (in each case, subject to the prior written
consent of the Borrower); and 
 WHEREAS, contemporaneously with the effectiveness of the Tranche
B-1 Term Commitments on the First Amendment Effective Date, the Borrower wishes to (a) make certain amendments to the Existing Credit Agreement to provide for the incurrence of the Tranche B-1 Term Loans and (b) make certain other modifications to the Existing Credit Agreement set forth herein. 

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

	1.	Existing Credit Agreement Amendments. Effective as of the First Amendment Effective Date, the Existing Credit Agreement is hereby amended as follows: 

 

	 	(a)	Global Amendments to Certain Definitions. Each reference to “Initial Term Loan” and “Initial Term Loans”, as applicable, contained in Section 1.07(a) and Section 2.10 is replaced
with a reference to “Tranche B-1 Term Loan” or “Tranche B-1 Term Loans”, as appropriate. 

 

	 	(b)	Section 1.01 of the Existing Credit Agreement is hereby amended by inserting the following new definitions in their correct alphabetical order: 

“First Amendment” means that certain First Amendment to this Agreement, dated as of November 30, 2017,
among the Borrower, the other Loan Parties party thereto, the Lenders party thereto, and the Administrative Agent. 

“First Amendment Effective Date” means the “First Amendment Effective Date” under and as defined in
First Amendment. 

  
 3 

 “Tranche B-1 Term
Commitments” means the “Tranche B-1 Term Commitments” as defined in First Amendment. 

“Tranche B-1 Term Loans” means the “Tranche B-1 Term Loans” as defined in First Amendment. 
 “Tranche B-1 Term Loan Lender” means any Lender with a Tranche B-1 Term Loan Commitment or an outstanding Tranche B-1 Term Loan. 

 

	 	(c)	The definition of “Applicable Rate” set forth in Section 1.01 of the Existing Credit Agreement is hereby amended by replacing clause (a) thereof in its entirety with the following: 

“Applicable Rate” means, for any day, (a) 1.50% per annum, in the case of an ABR Loan, or (ii) 2.50% per annum, in the case of
a Eurodollar Loan”. 
  

	 	(d)	Section 2.01 of the Existing Credit Agreement is hereby amended by adding the following new clause (b) at the end thereof: 

“(b) Subject to the terms and conditions set forth herein and in the First Amendment, each Tranche
B-1 Term Loan Lender with a Tranche B-1 Term Commitment severally made or exchanged, as applicable, on the First Amendment Effective Date, agrees to make a Tranche B-1 Term Loan to the Borrower denominated in Dollars in an amount equal to such Tranche B-1 Term Loan Lender’s Tranche B-1 Term
Commitment. The Borrower may make only one borrowing under the Tranche B-1 Term Commitments, which shall be on the First Amendment Effective Date. Each Lender’s Tranche
B-1 Term Commitment shall terminate immediately and without further action on the First Amendment Effective Date after giving effect to the funding of such Lender’s Tranche
B-1 Term Commitment on such date. Amounts borrowed under this Section 2.01(b) and repaid or prepaid may not be reborrowed. Tranche B-1 Term Loans may be ABR Loans
or Eurodollar Loans, as further provided herein.” 
  

	 	(e)	Section 2.11(a)(i) of the Existing Credit Agreement is hereby amended by replacing “Effective Date” with “First Amendment Effective Date”. 

 

	 	(f)	Section 2.14(d) of the Existing Credit Agreement is hereby amended and restated in its entirety as follows: 

“Notwithstanding the foregoing, if the Term Administrative Agent (i) determines that the circumstances described in clause
(a) of this Section 2.14 have arisen, (ii) determines that the circumstances described in clause (a) of this Section 2.14 have not arisen but the supervisor for the administrator of the LIBO Rate or a Governmental Authority
having jurisdiction over the Term Administrative Agent has made a public statement identifying a specific date after which the LIBO Rate shall no longer be used for determining interest rates for loans, (iii) is advised by the Required Lenders
of their determination in accordance with clause (b) of this Section 2.14, or (iv) new syndicated loans have started to adopt a new benchmark interest rate, then the Term Administrative Agent and the Borrower shall endeavor to
establish an alternate rate of interest to the LIBO Rate that gives due consideration to the then prevailing market convention for determining a rate of interest for syndicated loans in the United States at such time, and shall enter into an
amendment to this Agreement to reflect such alternate rate of interest and such other 

  
 4 

 
related changes to this Agreement as may be applicable, provided that to the extent that the Term Administrative Agent determines that adoption of any portion of such market convention is
not administratively feasible or that no market convention for the administration of such alternate rate of interest exists, the Term Administrative Agent shall administer such alternate rate of interest in a manner determined by the Term
Administrative Agent in consultation with the Borrower. Notwithstanding anything to the contrary in Section 9.02, such amendment shall become effective without any further action or consent of any other party to this Agreement so long as the
Term Administrative Agent shall not have received, within five (5) Business Days of the date notice of such alternate rate of interest is provided to the Lenders, a written notice from the Required Lenders stating that such Required Lenders
object to such amendment. If a notice of an alternate rate of interest has been given and no such alternate rate of interest has been determined, the circumstances under clause (i) above exist or the specific date referred to in clause
(ii) has occurred (as applicable), Alternate Base Rate shall apply without regard to clause (c) of the definition thereof. Provided that, if such alternate rate of interest shall be less than zero, such rate shall be deemed to be zero for
the purposes of this Agreement. 
  

	 	(g)	Clause (B) of the second proviso in Section 6.01(a)(v) of the Existing Credit Agreement is hereby amended by replacing the “greater of (x) $50,000,000 and (y) 40.0% of Consolidated EBITDA” with
“the greater of (x) $100,000,000 and (y) 60.0% of Consolidated EBITDA”. 

  

	3.	Tranche B-1 Term Loans. Subject to the terms and conditions set forth herein, each Tranche B-1 Term Loan Lender severally
agrees to exchange Existing Term Loans for Tranche B-1 Term Loans and/or make Tranche B-1 Term Loans to the Borrower in a single borrowing in Dollars on the First
Amendment Effective Date. The Tranche B-1 Term Loans shall be subject to the following terms and conditions: 

  

	 	(a)	Terms Generally. Other than as set forth herein, for all purposes under the Credit Agreement and the other Loan Documents, the Tranche B-1 Term Loans shall have the same
terms as the Initial Term Loans under the Existing Credit Agreement and shall be treated for purposes of voluntary and mandatory prepayments (including for scheduled principal payments) and all other terms as Initial Term Loans under the Existing
Credit Agreement. 

  

	 	(b)	Proposed Borrowing. Notwithstanding any other provisions of the Credit Agreement or any other Loan Document to the contrary, solely for purposes of the Tranche B-1 Loans to
be borrowed by the Borrower on the First Amendment Effective Date, this Amendment shall constitute a Borrowing Request by the Borrower to borrow the Tranche B-1 Term Loans from the Tranche B-1 Term Loan Lenders under the Credit Agreement. 

  

	 	(c)	 New Lenders. Each New Lender (i) confirms that it has received a copy of the Existing Credit
Agreement and the other Loan Documents and the exhibits and schedules thereto, together with copies of the financial statements referred to therein and such other documents and information as it has deemed appropriate to make its own credit analysis
and decision to enter into this Amendment and the Credit Agreement; (ii) agrees that it will, independently and without reliance upon the Administrative Agent, or the lead arranger and bookrunner noted on the cover page hereof (the
“Lead Arranger”) or any Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Credit Agreement;
(iii) appoints and authorizes the Administrative Agent to take such 

  
 5 

	 	
action as agent on its behalf and to exercise such powers under the Credit Agreement and the other Loan Documents as are delegated to the Administrative Agent by the terms thereof, together with
such powers as are reasonably incidental thereto; and (iv) agrees that it will perform all of the obligations which by the terms of the Credit Agreement are required to be performed by it as a Lender, as the case may be, in each case, in
accordance with the terms thereof as set forth in the Credit Agreement. Each New Lender acknowledges and agrees that it shall become a “Tranche B-1 Term Loan Lender” and a “Term Lender”
under, and for all purposes of, the Credit Agreement and the other Loan Documents, and shall be subject to and bound by the terms thereof, and shall have all rights of a “Tranche B-1 Term Loan
Lender” and a “Term Lender” thereunder. 

  

	 	(d)	Credit Agreement Governs. Except as set forth in this Amendment, the Tranche B-1 Term Loans shall otherwise be subject to the provisions of the Credit Agreement and the
other Loan Documents. 

  

	 	(e)	Exchange Mechanics. 

  

	 	(i)	On the First Amendment Effective Date, upon the satisfaction or waiver (by the Lead Arranger) of the conditions set forth in Section 4 hereof, the outstanding principal amount of Existing Term Loans of each
Converting Lender exchanged pursuant to this Amendment shall be deemed to be exchanged for an equal outstanding principal amount of Tranche B-1 Term Loans under the Credit Agreement. Such exchange shall be
effected by book entry in such manner, and with such supporting documentation, as may be reasonably determined by the Administrative Agent in its sole discretion in consultation with the Borrower. It is acknowledged and agreed that each Converting
Lender has agreed to accept as satisfaction in full of its right to receive payment on the outstanding amount of Existing Term Loans of such Converting Lender the conversion of its Existing Term Loans into Tranche
B-1 Term Loans in accordance herewith, in lieu of the prepayment amount that would otherwise be payable by the Borrower pursuant to the Credit Agreement in respect of the outstanding amount of Existing Term
Loans of such Converting Lender. Notwithstanding anything to the contrary herein or in the Credit Agreement, each Converting Lender hereby waives any rights or claims to compensation pursuant to Section 2.16 of the Credit Agreement in respect
of its Existing Term Loans exchanged for Tranche B-1 Term Loans. 

  

	 	(ii)	 (A) To the extent there exist (1) any Participating Cash Settlement Term Loans, the Fronting Bank shall be
deemed to exchange on the First Amendment Effective Date such Reallocated Term Loans on a cashless settlement basis for an equal aggregate principal amount of Tranche B-1 Term Loans under the Credit Agreement
and (2) any Non-Participating Cash Settlement Term Loans, the Fronting Bank shall apply on the First Amendment Effective Date proceeds of Tranche B-1 Term Loans in
an aggregate amount equal to the aggregate amount of such Non-Participating Cash Settlement Term Loans to the repayment of such Non-Participating Cash Settlement Term
Loans and (B) promptly following the First Amendment Effective Date (but not later than 30 days following the First Amendment Effective Date (or such later date as may be agreed to by the Fronting Bank in its sole discretion)), each New Lender,
each Non-Converting Lender and each Existing Term Lender purchasing additional Tranche B-1 Term Loans shall purchase from the Fronting Bank the Tranche B-1 Term Loans
exchanged for or applied to the repayment of such Reallocated Term Loans as directed by the RBC 

  
 6 

	 	
Capital Markets in its capacity as a Lead Arranger hereunder, in accordance with such Repricing Participating Lender’s Tranche B-1 Participation
Notice and as allocated by the RBC Capital Markets in its capacity as a Lead Arranger hereunder. Purchases and sales of Reallocated Term Loans and Tranche B-1 Term Loans shall be without representations from
the Fronting Bank other than as provided for in the relevant Assignment and Assumption. 

  

	4.	Effective Date Conditions. This Amendment will become effective on the date (the “First Amendment Effective Date”), on which each of the following conditions have been satisfied (or waived
by the Lead Arranger) in accordance with the terms therein: 

  

	 	(a)	the Administrative Agent (or its counsel) shall have received from each of the Borrower, the other Loan Parties party hereto and the Repricing Participating Lenders, either (i) a counterpart of this Amendment
signed on behalf of such party or (ii) written evidence satisfactory to the Administrative Agent (which may include facsimile or other electronic transmission of a signed counterpart of this Amendment) that such party has signed a counterpart
to this Amendment (which, in the case of the Participating Lenders, may be in the form of a Tranche B-1 Participation Notice); 

 

	 	(b)	the Administrative Agent shall have received fully executed and delivered Tranche B-1 Participation Notices from Repricing Participating Lenders and the Fronting Bank representing
100% of (x) the aggregate principal amount of the Existing Term Loans less (y) the aggregate principal amount of any Non-Participating Cash Settlement Term Loans; 

 

	 	(c)	the Administrative Agent shall have received a certificate of the Borrower dated as of the First Amendment Effective Date and executed by a secretary, assistant secretary or other senior officer (as the case may be)
thereof (i) (A) certifying and attaching the resolutions or similar consents adopted by the Borrower approving or consenting to this Amendment and the Tranche B-1 Term Loans, (B) certifying that the
certificate or articles of organization or formation and by-laws or operating (or limited liability company) agreement of the Borrower either (x) have not been amended since the Closing Date or
(y) are attached as an exhibit to such certificate, and (C) certifying as to the incumbency and specimen signature of each officer executing this Amendment and any related documents on behalf of the Borrower and (ii) certifying as to
the matters set forth in clauses (e) and (f) below; 

  

	 	(d)	(i) the Administrative Agent shall have received all fees and other amounts previously agreed to in writing by the Lead Arranger and the Borrower to be due on or prior to the First Amendment Effective Date, including,
to the extent invoiced at least three Business Days prior to the First Amendment Effective Date (or such later date as is reasonably agreed by the Borrower), including legal fees and expenses and the fees and expenses of any other advisors in
accordance with the terms of the Credit Agreement and (ii) all accrued interest and fees in respect of the Existing Term Loans outstanding immediately prior to effectiveness of this Amendment shall have been paid; 

 

	 	(e)	the representations and warranties in Section 5 of this Amendment shall be true and correct in all material respects on and as of the First Amendment Effective Date; provided that, (A) in the case of
any such representation and warranty which expressly relates to a given date or period, such representation and warranty shall be true and correct in all material respects as of the respective date or for the respective period, as the case may be
and (B) if any such representation and warranty is qualified by “material”, “material adverse effect” or similar term or qualification such representation and warranty shall be true and correct in all respects;

  
 7 

	 	(f)	no Default or Event of Default shall exist on the First Amendment Effective Date before or after giving effect to the effectiveness of this Amendment and the incurrence of the Tranche
B-1 Term Loans; 

  

	 	(g)	the Administrative Agent shall have received a certificate dated as of the First Amendment Effective Date in substantially the form of Exhibit P to the Credit Agreement from the chief financial officer (or other officer
with reasonably equivalent responsibilities) of the Borrower certifying as to the matters set forth therein; 

  

	 	(h)	the Administrative Agent shall have received a customary written opinion (addressed to the Administrative Agent and the Lenders and dated as of the First Amendment Effective Date) of Winston & Strawn LLP, New
York and Delaware counsel for the Loan Parties, in form and substance reasonably satisfactory to the Administrative Agent; and 

  

	 	(i)	the Administrative Agent shall have received (on behalf of the New Lenders) all documentation at least three Business Days prior to the First Amendment Effective Date and other information about the Loan Parties that
shall have been reasonably requested in writing at least ten Business Days prior to the First Amendment Effective Date and the Administrative Agent has reasonably determined is required by United States regulatory authorities under applicable
“know your customer” and anti-money laundering rules and regulations, including without limitation Title III of the USA Patriot Act. 

  

	5.	Representations and Warranties. By its execution of this Amendment, each Loan Party hereby represents and warrants that: 

 

	 	(a)	such Loan Party has all requisite organizational power and authority to make, deliver and perform its obligations under this Amendment and has taken all necessary corporate or other action to authorize the execution,
delivery and performance of this Amendment; 

  

	 	(b)	such Loan Party has duly executed and delivered this Amendment and this Amendment constitutes the legal, valid and binding obligation of such Loan Party enforceable in accordance with its terms, except as such
enforceability may be limited by Debtor Relief Laws and by general principles of good faith and fair dealing; 

  

	 	(c)	no material consent or approval of, registration or filing with, or any other action by, any Governmental Authority is required in connection with the execution, delivery, performance, validity or enforceability of this
Amendment, except for (a) the approvals, consents, exemptions, authorizations, actions, notices and filings that have been duly obtained, taken, given or made and are in full force and effect and (b) those approvals, consents, exemptions,
authorizations or other actions, notices or filings, the failure of which to obtain or make would not reasonably be expected to have a Material Adverse Effect; 

  

	 	(d)	 the execution, delivery and performance of this Amendment by the Loan Parties hereto will not (a) contravene
the terms of the Organizational Documents of the Loan Parties, (b) violate any material order, injunction, writ or decree of any Governmental Authority or any arbitral award to which such Loan Party or its property is subject or violate any
applicable material Law except to the extent that such breach, contravention or violation would not 

  
 8 

	 	
reasonably be expected to have a Material Adverse Effect or (c) breach or result in a default under (i) the ABL Credit Agreement or the ABL/Term Loan Intercreditor Agreement or
(ii) any other material contractual obligation to which such Loan Party is a party or is otherwise bound which violation, except in the case of this clause (c) to the extent that such breach or default would not reasonably be expected to
result in a Material Adverse Effect; and 

  

	 	(e)	both immediately before and after giving effect to the First Amendment Effective Date and the incurrence and/or exchange of the Tranche B-1 Term Loans, (i) the
representations and warranties of the Loan Parties set forth in the Credit Agreement and the other Loan Documents shall be true and correct in all material respects (or, in the case of any such representation and warranty that is qualified by
“material”, “material adverse effect” or a similar term, in all respects), in each case, on and as of the First Amendment Effective Date with the same effect as though such representations and warranties had been made on and as
of the First Amendment Effective Date, except to the extent that such representations and warranties relate to an earlier date, in which case such representations and warranties shall be true and correct in all material respects (or, in the case of
any such representation and warranty that is qualified by “material”, “material adverse effect” or a similar term, in all respects) as of such earlier date and (ii) no Default or Event of Default shall have occurred and be
continuing on the First Amendment Effective Date or would result from the consummation of this Amendment and the transactions contemplated hereby. 

  

	6.	Use of Proceeds. The proceeds of the Tranche B-1 Term Loans shall be applied in exchange for or to prepay in full the aggregate principal amount of the
Existing Term Loans outstanding on the First Amendment Effective Date in accordance with the terms hereof. 

  

	7.	Reaffirmation of the Loan Parties; Reference to and Effect on the Credit Agreement and the other Loan Documents. 

  

	 	(a)	Each Loan Party hereby consents to the amendment of the Credit Agreement effected hereby and confirms and agrees that, notwithstanding the effectiveness of this Amendment, each Loan Document to which such Loan Party is
a party is, and the obligations of such Loan Party contained in the Credit Agreement, this Amendment or in any other Loan Document to which it is a party are, and shall continue to be, in full force and effect and are hereby ratified and confirmed
in all respects, in each case as amended by this Amendment. For greater certainty and without limiting the foregoing, each Loan Party hereby confirms that the existing security interests and/or guarantees granted by such Loan Party in favor of the
Secured Parties pursuant to the Loan Documents in the Collateral described therein shall continue to secure the obligations of the Loan Parties under the Credit Agreement and the other Loan Documents as and to the extent provided in the Loan
Documents. Except as specifically amended by this Amendment, the Credit Agreement and the other Loan Documents shall remain in full force. 

  

	 	(b)	Except to the extent expressly set forth in this Amendment, the execution, delivery and performance of this Amendment shall not constitute a waiver of any provision of, or operate as a waiver of any right, power or
remedy of any Agent or Lender under, the Credit Agreement or any of the other Loan Documents. 

  

	 	(c)	On and after the First Amendment Effective Date, each reference in the Credit Agreement to “this Amendment”, “hereunder”, “hereof”, “herein” or words of like import referring to
the Credit Agreement, and each reference in the other Loan Documents to the “Credit Agreement”, “thereunder”, “thereof” or words of like import referring to the Credit Agreement shall mean and be a reference to the
Credit Agreement as amended by this Amendment. 

  
 9 

	8.	Prepayment Notice. The Participating Lenders and the Fronting Bank party hereto, which constitute the Required Lenders, and the Administrative Agent hereby waive the requirement under Section 2.11(f)
of the Credit Agreement to provide notice to the Administrative Agent not less than three Business Days prior to the prepayment of the Existing Term Loans that are Eurodollar Loans and not less than one Business Day prior to the prepayment of the
Existing Term Loans that are ABR Loans contemplated herein. It is understood and agreed that notwithstanding any provisions of the Credit Agreement or any other Loan Document to the contrary this Amendment shall serve as the notice referred to in
Section 2.11(f) of the Credit Agreement. 

  

	9.	Notice of Refinancing. Pursuant to this Amendment, the Borrower hereby requests a Borrowing of Tranche B-1 Term Loans in an aggregate principal amount of
$299,250,000, with such Borrowing to be made on the First Amendment Effective Date and to have an Interest Period of one month. 

  

	10.	Notice. For purposes of the Credit Agreement, the initial notice address of each New Lender shall be as separately identified to the Administrative Agent. 

 

	11.	Tax Forms. For each New Lender, delivered herewith to the Administrative Agent are such forms, certificates or other evidence with respect to United States federal income tax withholding matters as such
New Lender may be required to deliver to the Administrative Agent pursuant to Section 2.17 of the Credit Agreement. 

  

	12.	Recordation of the New Loans. Upon execution and delivery hereof, the Administrative Agent will record the Tranche B-1 Term Loans made by each Participating Lender
in the Register. 

  

	13.	Amendment, Modification and Waiver. This Amendment may not be amended, modified or waived except as permitted by Section 9.02 of the Credit Agreement. 

 

	14.	Integration. This Amendment, the other Loan Documents and any separate letter agreements with respect to fees payable to the Lead Arranger and/or the Administrative Agent or the syndication of the Tranche B-1 Term Loans and commitments related thereto constitute the entire agreement among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or
written, relating to the subject matter hereof. This Amendment shall not constitute a novation of any amount owing under the Credit Agreement and all amounts owing in respect of principal, interest, fees and other amounts pursuant to the Credit
Agreement and the other Loan Documents shall, to the extent not paid or exchanged on or prior to the First Amendment Effective Date, continue to be owing under the Credit Agreement or such other Loan Documents until paid in accordance therewith.

  

	15.	GOVERNING LAW; JURISDICTION; CONSENT TO SERVICE OF PROCESS. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK. SECTION 9.09 OF THE CREDIT AGREEMENT IS
HEREBY INCORPORATED BY REFERENCE INTO THIS AMENDMENT AS IF SUCH PROVISION WERE SET FORTH IN FULL HEREIN MUTATIS MUTANDIS AND SHALL APPLY HERETO. 

  
 10 

	16.	Severability. Any provision of this Amendment that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability
without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. 

 

	17.	Counterparts. This Amendment may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together
shall constitute a single contract. Delivery of an executed counterpart of a signature page to this Amendment by facsimile or by email as a “.pdf” or “.tif” attachment shall be effective as delivery of a manually executed
counterpart of this Amendment. 

  

	18.	WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY 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 OR RELATING TO THIS AMENDMENT 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 PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON 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.

  

	19.	Loan Document. On and after the First Amendment Effective Date, this Amendment shall constitute a “Loan Document” for all purposes of the Credit Agreement and the other Loan Documents.

 [Signature Pages Follow] 

  
 11 

 IN WITNESS WHEREOF, each of the undersigned has caused its duly authorized officer to
execute and deliver this Amendment as of the date first set forth above. 
  

			
	 INSTALLED BUILDING PRODUCTS, INC.,

as the Borrower

		
	By:	 	 /s/ Michael T. Miller

		 	Name: Michael T. Miller
		 	Title: Executive Vice President and Chief Financial Officer

  

							
	 ACCURATE INSULATION LLC

ACCURATE INSULATION OF COLORADO, LLC

ACCURATE INSULATION OF DELAWARE, LLC

ACCURATE INSULATION OF UPPER MARLBORO, LLC

ALL CONSTRUCTION SERVICES, LLC

ALL IN ONE & MOORE BUILDING SYSTEMS, LLC

ALPHA INSULATION & WATER PROOFING COMPANY

ALPHA INSULATION & WATER PROOFING, INC.

ALPINE INSULATION I, LLC

AMERICAN INSULATION & ENERGY SERVICES, LLC

ANY SEASON INSULATION, LLC

APPLE VALLEY INSULATION, A BDI COMPANY, INC.

B-ORGANIZED INSULATION, LLC

BAYTHERM INSULATION, LLC

BDI INSULATION OF IDAHO FALLS, INC.

BDI INSULATION OF SALT LAKE, L.L.C.

BER ENERGY SERVICES, LLC

BIG CITY INSULATION, INC.

BIG CITY INSULATION OF IDAHO, INC.

BROKEN DRUM OF BAKERSFIELD, INC. 

BROKEN DRUM INSULATION VISALIA, INC.

BUILDERS INSTALLED PRODUCTS OF MAINE, LLC
	  	 EASTERN CONTRACTOR SERVICES LIMITED LIABILITY COMPANY

ECOLOGIC ENERGY SOLUTIONS, LLC

EDWARDS/MOONEY & MOSES, LLC

EMPER HOLDINGS, LLC

FIBERCLASS INSULATION, LLC

FORT WAYNE URETHANE, LLC

GARAGE DOOR SYSTEMS, LLC

GOLD INSULATION, INC.

G-T-G, LLC

HINKLE INSULATION & DRYWALL COMPANY, INCORPORATED

HORIZON ELECTRIC SERVICES, LLC

IBHL A HOLDING COMPANY, INC.

IBHL B HOLDING COMPANY, INC.

IBHL II-A HOLDING COMPANY, INC.

IBHL II-B HOLDING COMPANY, INC.

IBP ARCTIC EXPRESS, LLC

IBP ASSET, LLC

IBP ASSET II, LLC

IBP CORPORATION HOLDINGS, INC.

IBP EXTERIORS, INC.

IBP HOLDINGS, LLC

IBP HOLDINGS II, LLC

IBP OF MANSFIELD, LLC

IBP OF OKLAHOMA, LLC

IBP OF SAN ANTONIO, LLC

IBP OF TOLEDO, LLC

IBP TEXAS ASSETS I, LLC

IBP TEXAS ASSETS II, LLC

IBP TEXAS ASSETS III, LLC

 

									
	By:	 	 /s/ Michael T. Miller
	 		 	By:	 	 /s/ Michael T. Miller

		 	Michael T. Miller	 		 		 	Michael T. Miller
		 	 Executive Vice President and Chief Financial

Officer
	 		 		 	 Executive Vice President and Chief Financial

Officer

  
 [Signature Page to
First Amendment to Term Loan Credit Agreement] 

			
	 BUILDERS INSTALLED PRODUCTS OF NEW HAMPSHIRE, LLC

BUILDERS INSTALLED PRODUCTS OF NEW YORK, LLC

BUILDERS INSTALLED PRODUCTS OF VERMONT, LLC

BUILDING MATERIALS FINANCE, INC.

CLS INSULATION, LLC

CORNHUSKER INSULATION, LLC

C.Q. INSULATION, INC.

EAST COAST INSULATORS II, LLC

INSULATION WHOLESALE SUPPLY, LLC

INSULVAIL, LLC

KEY INSULATION OF AUSTIN, LLC

KEY INSULATION OF SAN ANTONIO, LLC

LAKESIDE INSULATION, LLC

LAYMAN BROTHERS INSULATION, LLC

LKS TRANSPORTATION, LLC

LOVEDAY INSULATION, LLC

M&D INSULATION, LLC

MAP INSTALLED BUILDING PRODUCTS OF SAGAMORE, LLC

MAP INSTALLED BUILDING PRODUCTS OF SEEKONK, LLC

MARV’S INSULATION, INC.

METRO HOME INSULATION, LLC

MID SOUTH CONSTRUCTION AND BUILDING PRODUCTS, INC.

MIG BUILDING SYSTEMS, LLC

MIG BUILDING SYSTEMS OF EAST SYRACUSE, LLC

MOMPER INSULATION OF CROWN POINT, LLC

MOMPER INSULATION OF ELKHART, LLC

MOMPER INSULATION OF FORT WAYNE, LLC

NORTHWEST INSULATION, LLC

OJ INSULATION HOLDINGS, INC.

PACIFIC PARTNERS INSULATION NORTH, A BDI COMPANY, LLC

ELITE SPRAY FOAM OF LAS VEGAS, LLC
	  	 INSTALLED BUILDING PRODUCTS, LLC

INSTALLED BUILDING PRODUCTS II, LLC

INSTALLED BUILDING PRODUCTS OF HOUSTON, LLC

INSTALLED BUILDING PRODUCTS - PORTLAND, LLC

INSTALLED BUILDING SOLUTIONS II, LLC

INSULATION NORTHWEST, LLC

PACIFIC PARTNERS INSULATION SOUTH, A BDI COMPANY, LLC

PARKER INSULATION AND BUILDING PRODUCTS, LLC

PEG, LLC

RAJAN, LLC

ROCKFORD INSULATION, LLC

SIERRA INSULATION CONTRACTORS II, LLC

SOUTHERN INSULATORS, LLC

SPEC 7 INSULATION CO., LLC

SUPERIOR INSULATION, LLC

SUPERIOR INSULATION SERVICES, LLC

TCI CONTRACTING, LLC

TCI CONTRACTING OF CHARLESTON, LLC

TCI CONTRACTING OF HILTON HEAD, LLC

TCI CONTRACTING OF KENTUCKY, LLC

TCI CONTRACTING OF MEMPHIS, LLC

TCI CONTRACTING OF NASHVILLE, LLC

TCI CONTRACTING OF THE GULF, LLC

THERMAL CONTROL INSULATION, LLC

TIDEWATER INSULATORS, LLC

TOWN BUILDING SYSTEMS, LLC

TRILOK INDUSTRIES, INC.

U.S. INSULATION CORP.

WATER-TITE COMPANY, LLC

WILSON INSULATION COMPANY, LLC

SUBURBAN INSULATION, INC.

A+ INSULATION OF KANSAS CITY, LLC

ASTRO INSULATION OF ILLINOIS, LLC

ENERGY SAVERS OF LOUISVILLE, LLC

  

									
	By:	 	 /s/ Michael T. Miller
	 		 	By:	 	 /s/ Michael T. Miller

		 	Michael T. Miller	 		 		 	Michael T. Miller
		 	 Executive Vice President and Chief Financial

Officer
	 		 		 	 Executive Vice President and Chief Financial

Officer

  
 [Signature Page to
First Amendment to Term Loan Credit Agreement] 

													
	GOLD STAR INSULATION, L.P.	 		 	OJ INSULATION, L.P.
					
	By:	 	Gold Insulation, Inc., its general partner	 		 	By:	 	OJ Insulation Holdings, Inc., its general partner
							
		 	By:	 	 /s/ Michael T. Miller
	 		 		 	By:	 	 /s/ Michael T. Miller

		 		 	Michael T. Miller	 		 		 		 	Michael T. Miller
		 		 	 Executive Vice President
 and Chief Financial
Officer
	 		 		 		 	 Executive Vice President
 and Chief Financial
Officer

  
 [Signature Page to
First Amendment to Term Loan Credit Agreement] 

 
			
	ROYAL BANK OF CANADA, as Administrative Agent
		
	By:	 	 /s/ Ann Hurley

		 	Name: Ann Hurley
		 	Title: Manager, Agency

  
 [Signature Page to
First Amendment to Term Loan Credit Agreement] 

 
			
	ROYAL BANK OF CANADA, as Fronting Bank
		
	By:	 	 /s/ Ann Hurley

		 	Name: Ann Hurley
		 	Title: Manager, Agency

  
 [Signature Page to
First Amendment to Term Loan Credit Agreement] 

 EXHIBIT A 

Form of Tranche B-1 Participation Notice 

Royal Bank of Canada, as Administrative Agent 
 20 King Street
West, 4th Floor 
 Toronto, Ontario M5H 1C4 Canada 

	Attention:	Manager, Agency Services 

	Telephone:	(416) 842-5196 

	Fax:	(416) 842-4023 

 INSTALLED BUILDING PRODUCTS, INC.

 Tranche B-1 Participation Notice 

Ladies and Gentlemen: 
 Reference is made to the
First Amendment (as may be amended, restated, amended and restated, supplemented or otherwise modified from time to time, the “Amendment”) to that certain Term Loan Credit Agreement, dated as of April 13, 2017 (as may be
amended, restated, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), among, among INSTALLED BUILDING PRODUCTS, INC. (the “Borrower”), the Lenders party thereto from
time to time and ROYAL BANK OF CANADA (“RBC”), as administrative agent (in such capacity, the “Administrative Agent”). Unless otherwise specified herein, capitalized terms used but not defined herein are used as
defined in the Amendment. 
 By delivery of this letter agreement (this “Tranche B-1
Participation Notice”), each of the undersigned (each a “Repricing Participating Lender”), hereby irrevocably consents to the Amendment and the amendment of the Credit Agreement contemplated thereby and (check as
applicable): 
 NAME OF REPRICING PARTICIPATING LENDER: 

      
  

AMOUNT OF EXISTING TERM LOANS OF SUCH
REPRICING PARTICIPATING LENDER: 
 $      

 
  

	☐	Cashless Settlement Option. Hereby (i) elects, upon the First Amendment Effective Date, to exchange the full amount (or such lesser amount as may be allocated by the Lead Arranger) of the outstanding
Existing Term Loans of such Repricing Participating Lender for an equal outstanding amount of Tranche B-1 Term Loans under the Credit Agreement and (ii) represents and warrants to the Administrative Agent
that it has the organizational power and authority to execute, deliver and perform its obligations under this Tranche B-1 Participation Notice and the Amendment (including, without limitation, with respect to
any exchange contemplated hereby) and has taken all necessary corporate and other organizational action to authorize the execution, delivery and performance of this Tranche B-1 Participation Notice and the
Amendment. 

  

	☐	 Cash Settlement Option. Hereby (i) elects to have the full amount (or such lesser amount as
may be allocated by the Lead Arranger) of the outstanding Existing Term Loans of such Repricing Participating Lender repaid or purchased and agrees to promptly (but in any event, on or prior to the date that is 30 days following the First Amendment
Effective Date) 

	 	
purchase (via assignment and assumption) an equal amount of Tranche B-1 Term Loans and (ii) represents and warrants to the Administrative Agent that
it has the organizational power and authority to execute, deliver and perform its obligations under this Tranche B-1 Participation Notice and the Amendment (including, without limitation, with respect to any
exchange contemplated hereby) and has taken all necessary corporate and other organizational action to authorize the execution, delivery and performance of this Tranche B-1 Participation Notice and the
Amendment. 

 [Signature Page Follows] 

 
			
	Very truly yours,
	
	                                   
                     ,
		
	By:	 	  

		 	Name:
		 	Title:
		
	By:	 	  

		 	Name:
		 	Title:

  
 [Signature Page to
Tranche B-1 Participation Notice] 

 ANNEX I 

REALLOCATED TERM LOANS 
  

			
	Royal Bank of Canada	 	
$107,625,824.63

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