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Exhibit 4.1
AMENDMENT TWO TO AMENDED AND RESTATED
AGENTED CREDIT AGREEMENT
This Amendment Two to Amended and
Restated Agented Credit Agreement ("Amendment") is dated effective
October 31, 2006, among ORCHIDS PAPER PRODUCTS COMPANY
, a Delaware corporation ("Borrower"), BANK OF OKLAHOMA,
N.A. ("BOK"), BANCFIRST , and COMMERCE BANK, N.A.
(individually a "Bank" and collectively the "Banks"), and BANK
OF OKLAHOMA, N.A. , as agent for the Banks (in such capacity,
"Agent").
RECITALS
A. Reference is made to the
Amended and Restated Agented Credit Agreement dated June 24,
2005, by and among Borrower, Banks and Agent ( as amended from time
to time, the " Credit Agreement"), pursuant to which currently
exists (i) a term loan in the original principal amount of
$14,084,646.81; (ii) a $5,000,000 revolving line of credit,
and (iii) an advancing term loan in the amount of $15,000,000.
Terms used herein shall have the meanings given in the Credit
Agreement, unless otherwise defined herein.
B. Borrower has requested
certain modifications to the Credit Agreement, and Banks and Agent
have agreed to Borrower’s request, subject to the terms and
conditions of this Amendment.
AGREEMENT
NOW, THEREFORE, in consideration
of the representations and warranties contained herein and for
valuable consideration received, the parties agree to the
following:
1. Amendments to the
Credit Agreement . The Credit Agreement is hereby amended as
follows:
1.1 Section 10.1 (Funded Debt
to EBITDA) is hereby deleted and replaced with the following:
"10.1. Funded Debt to
EBITDA . Maintain, tested on the last day of each fiscal
quarter for the trailing twelve months, a ratio of (i) Funded
Debt of Borrower minus the balance of the Interest
Reserve Account on such date, to (ii) EBITDA for the preceding
four (4) consecutive fiscal quarters of Borrower, not greater
than (a) for the fiscal quarter ending September 30,
2006, 4.5 to 1, and (b) for the fiscal quarter ending
December 31, 2006 and each fiscal quarter thereafter, 4.0 to
1."
1.2 Section 10.4 (De
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