Exhibit 10.1

EXECUTION VERSION

SECOND AMENDED AND RESTATED CREDIT AGREEMENT

Dated as of September 16, 2011

among

THE FINANCIAL INSTITUTIONS NAMED HEREIN

as the Lenders

and

BANK OF AMERICA, N.A.

as the Agent

WELLS FARGO CAPITAL FINANCE, LLC

as Documentation Agent

DEUTSCHE BANK TRUST COMPANY AMERICAS

and

JPMORGAN CHASE BANK, N.A.

as Co-Syndication Agents

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED

as the Sole Lead Arranger and Book Manager

and

WESTLAKE CHEMICAL CORPORATION

and each other Person listed on Schedule 1 hereto,

as the Borrowers

$400,000,000

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TABLE OF CONTENTS

 

Section

       

Page

ARTICLE 1. LOANS AND LETTERS OF CREDIT    1

1.1

   Total Facility.    1

1.2

   Revolving Loans.    1

1.3

   Letters of Credit.    5

1.4

   Bank Products.    10 ARTICLE 2. INTEREST AND FEES    10

2.1

   Interest.    10

2.2

   Continuation and Conversion Elections.    11

2.3

   Maximum Interest Rate.    12

2.4

   Closing Fee.    12

2.5

   Unused Line Fee.    12

2.6

   Letter of Credit Fee.    13 ARTICLE 3. PAYMENTS AND PREPAYMENTS    13

3.1

   Revolving Loans.    13

3.2

   Full or Partial Termination of Facility.    13

3.3

   Prepayments of the Loans.    13

3.4

   LIBOR Rate Loan Prepayments.    14

3.5

   Payments by the Borrowers.    14

3.6

   Payments as Revolving Loans.    14

3.7

   Apportionment, Application and Reversal of Payments.    14

3.8

   Indemnity for Returned Payments.    15

3.9

   Agent’s and Lenders’ Books and Records; Monthly Statements.    15 ARTICLE 4.
TAXES, YIELD PROTECTION AND ILLEGALITY    16

4.1

   Taxes.    16

4.2

   Illegality.    18

4.3

   Increased Costs; Capital Adequacy.    18

4.4

   Funding Losses.    19

4.5

   Inability to Determine Rates.    19

4.6

   Certificates of the Agent.    20

4.7

   Delay in Requests.    20

4.8

   Mitigation.    20

4.9

   Replacement of Lenders.    20

4.10

   Survival.    20 ARTICLE 5. BOOKS AND RECORDS; FINANCIAL INFORMATION; NOTICES
   21

5.1

   Books and Records.    21

5.2

   Financial Information.    21

5.3

   Notices to the Agent.    25 ARTICLE 6. GENERAL WARRANTIES AND REPRESENTATIONS
   27

6.1

   Authorization, Validity, and Enforceability of this Agreement and the Loan
Documents.    27

6.2

   Validity and Priority of Security Interest.    27

6.3

   Organization and Qualification.    27

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6.4

   Corporate Name; Prior Transactions.    27

6.5

   Subsidiaries and Affiliates.    28

6.6

   Financial Statements and Projections.    28

6.7

   Solvency.    28

6.8

   Real Estate; Leases.    28

6.9

   Proprietary Rights.    29

6.10

   Trade Names.    29

6.11

   Litigation.    29

6.12

   Labor Disputes.    29

6.13

   Environmental Laws.    29

6.14

   No Violation of Law.    30

6.15

   No Default.    30

6.16

   ERISA Compliance.    31

6.17

   Taxes.    31

6.18

   Regulated Entities.    31

6.19

   Use of Proceeds; Margin Regulations.    31

6.20

   Copyrights, Patents, Trademarks and Licenses, etc.    32

6.21

   No Material Adverse Change.    32

6.22

   Full Disclosure.    32

6.23

   Locations of Collateral.    32

6.24

   Deposit Accounts.    32

6.25

   Governmental Authorization.    32

6.26

   No Restrictions.    33 ARTICLE 7. AFFIRMATIVE AND NEGATIVE COVENANTS    33

7.1

   Taxes and Other Obligations.    33

7.2

   Legal Existence and Good Standing.    33

7.3

   Compliance with Law and Agreements; Maintenance of Licenses; Amendments to
Charter Documents.    33

7.4

   Maintenance of Property; Inspection of Property.    34

7.5

   Insurance.    34

7.6

   Insurance and Condemnation Proceeds.    35

7.7

   Environmental Laws.    35

7.8

   Compliance with ERISA.    36

7.9

   Mergers; Consolidations; or Sales.    36

7.10

   Distributions; Capital Change; Restricted Investments.    37

7.11

   Transactions Affecting Collateral or Obligations.    39

7.12

   Guaranties.    39

7.13

   Debt.    39

7.14

   Payment / Prepayment of Debt.    40

7.15

   Transactions with Affiliates.    41

7.16

   Business Conducted.    41

7.17

   Liens.    42

7.18

   Sale and Leaseback Transactions.    42

7.19

   New Subsidiaries.    42

7.20

   Fiscal Year.    42

7.21

   Fixed Charge Coverage Ratio.    42

7.22

   Use of Proceeds.    42

7.23

   Collateral.    42

7.24

   Tax Shelter Regulations.    44

7.25

   Permitted Acquisitions.    44

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7.26

   Excluded Deposit Accounts.    45

7.27

   Further Assurances.    45 ARTICLE 8. CONDITIONS OF LENDING    46

8.1

   Conditions Precedent to Making of Loans on the Closing Date.    46

8.2

   Conditions Precedent to Each Loan.    48 ARTICLE 9. DEFAULT; REMEDIES    48

9.1

   Events of Default.    48

9.2

   Remedies.    51 ARTICLE 10. TERM AND TERMINATION    52

10.1

   Term and Termination.    52 ARTICLE 11. AMENDMENTS; WAIVERS; PARTICIPATIONS;
ASSIGNMENTS; SUCCESSORS    53

11.1

   Amendments and Waivers.    53

11.2

   Assignments; Participations.    54 ARTICLE 12. THE AGENT    57

12.1

   Appointment and Authorization.    57

12.2

   Delegation of Duties.    57

12.3

   Liability of Agent.    57

12.4

   Reliance by Agent.    57

12.5

   Notice of Default.    58

12.6

   Credit Decision.    58

12.7

   Indemnification.    58

12.8

   Agent in Individual Capacity.    59

12.9

   Successor Agent.    59

12.10

   Collateral Matters.    59

12.11

   Restrictions on Actions by Lenders; Sharing of Payments.    60

12.12

   Agency for Perfection.    61

12.13

   Payments by Agent to Lenders.    61

12.14

   Settlement.    61

12.15

   Concerning the Collateral and the Related Loan Documents.    64

12.16

   Field Audit and Examination Reports; Disclaimer by Lenders.    64

12.17

   Relation Among Lenders.    65

12.18

   Co-Agents.    65

12.19

   Bank Product Providers.    65 ARTICLE 13. MISCELLANEOUS    66

13.1

   No Waivers; Cumulative Remedies.    66

13.2

   Severability.    66

13.3

   Governing Law; Choice of Forum; Service of Process.    66

13.4

   WAIVER OF JURY TRIAL.    67

13.5

   Survival of Representations and Warranties.    67

13.6

   Other Security and Guaranties.    67

13.7

   Fees and Expenses.    68

13.8

   Notices.    68

13.9

   Waiver of Notices.    69

13.10

   Binding Effect.    69

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13.11

   Indemnity of the Agent, the Arranger, the Letter of Credit Issuers and the
Lenders by the Borrowers.    70

13.12

   Limitation of Liability.    70

13.13

   No Advisory or Fiduciary Responsibility.    71

13.14

   Final Agreement.    71

13.15

   Counterparts.    71

13.16

   Captions.    71

13.17

   Right of Setoff.    71

13.18

   Confidentiality.    72

13.19

   Conflicts with Other Loan Documents.    73

13.20

   Westlake as Agent.    73

13.21

   Patriot Act Notice.    73

13.22

   Restatement of Existing Credit Agreement.    73

13.23

   Confirmations.    74

13.24

   Electronic Execution.    74

ANNEXES, EXHIBITS AND SCHEDULES

 

ANNEX A    –    DEFINITIONS EXHIBIT A    –    FORM OF NOTE EXHIBIT B    –   
FORM OF BORROWING BASE CERTIFICATE EXHIBIT C    –    FORM OF OBLIGATION GUARANTY
EXHIBIT D    –    FORM OF NOTICE OF BORROWING EXHIBIT E    –    FORM OF NOTICE
OF CONTINUATION/CONVERSION EXHIBIT F    –    FORM OF ASSIGNMENT AND ACCEPTANCE
AGREEMENT EXHIBIT G    –    FORM OF COMPLIANCE CERTIFICATE SCHEDULE 1    –   
BORROWERS SCHEDULE 1.2    –    LENDERS’ COMMITMENTS SCHEDULE 6.4    –    PRIOR
CORPORATE NAMES SCHEDULE 6.5    –    SUBSIDIARIES AND AFFILIATES SCHEDULE 6.9   
–    PROPRIETARY RIGHTS SCHEDULE 6.10    –    TRADE NAMES SCHEDULE 6.11    –   
LITIGATION SCHEDULE 6.12    –    LABOR DISPUTES SCHEDULE 6.13    –   
ENVIRONMENTAL LAW SCHEDULE 6.16    –    ERISA COMPLIANCE SCHEDULE 6.23    –   
LOCATIONS OF COLLATERAL SCHEDULE 6.24    –    DEPOSIT ACCOUNTS SCHEDULE 7.10   
–    EXISTING INVESTMENTS SCHEDULE 7.13    –    DEBT AND EXISTING LETTERS OF
CREDIT SCHEDULE 7.17    –    EXISTING LIENS

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SECOND AMENDED AND RESTATED CREDIT AGREEMENT

This Second Amended and Restated Credit Agreement, dated as of September 16,
2011 (this “Agreement”) among the financial institutions from time to time
parties hereto (such financial institutions, together with their respective
successors and assigns, are referred to hereinafter each individually as a
“Lender” and collectively as the “Lenders”), Bank of America, N.A. with an
office at 901 Main Street, Dallas, Texas, 75202, as agent for the Lenders (in
its capacity as agent, the “Agent”), and Westlake Chemical Corporation, a
Delaware corporation (“Westlake”) and certain of its domestic subsidiaries
listed on Schedule 1 hereto, each with offices at 2801 Post Oak Boulevard,
Houston, Texas 77056 (each a “Borrower” and collectively, all Borrowers,
including Westlake, the “Borrowers”).

W I T N E S S E T H:

WHEREAS, Westlake and certain of its domestic subsidiaries as borrowers, the
Agent, and lenders party thereto entered into an Amended and Restated Credit
Agreement dated as of September 8, 2008, which amended and restated the Credit
Agreement dated as of July 31, 2003 among Westlake, certain of its domestic
subsidiaries as borrowers, the Agent and the lenders party thereto (as amended,
restated, amended and restated, supplemented, or otherwise modified from time to
time prior to the date hereof, the “Existing Credit Agreement”);

WHEREAS, Westlake and other Borrowers have requested that the Lenders amend
certain provisions of the Existing Credit Agreement, and the parties have agreed
to amend and restate the Existing Credit Agreement, in each case, upon the terms
and conditions set forth in this Agreement; and

WHEREAS, capitalized terms used in this Agreement and not otherwise defined
herein shall have the meanings ascribed thereto in Annex A, which is attached
hereto and incorporated herein; the rules of construction contained therein
shall govern the interpretation of this Agreement, and all Annexes, Exhibits,
and Schedules attached hereto are incorporated herein by reference.

NOW, THEREFORE, in consideration of the mutual conditions and agreements set
forth in this Agreement, and for good and valuable consideration, the receipt of
which is hereby acknowledged, the Lenders, the Agent, and the Borrowers hereby
agree as follows.

ARTICLE 1.

LOANS AND LETTERS OF CREDIT

1.1 Total Facility. Subject to all of the terms and conditions of this
Agreement, the Lenders agree to make available a total credit facility of up to
$400,000,000 (as such amount may be increased or reduced from time to time
pursuant to the terms of this Agreement, the “Total Facility”) to the Borrowers
from time to time during the term of this Agreement. The Total Facility shall be
composed of a revolving line of credit consisting of Revolving Loans and Letters
of Credit described herein.

1.2 Revolving Loans.

(a) Revolving Loans and Notes.

(i) Amounts. Subject to the satisfaction of the conditions precedent set forth
in Article 8, each Lender severally, but not jointly, agrees, upon any
Borrower’s request

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from time to time on any Business Day during the period from the Closing Date to
the Termination Date, to make revolving loans (the “Revolving Loans”) to the
Borrowers in amounts not to exceed such Lender’s Pro Rata Share of Availability,
except for Non-Ratable Loans and Agent Advances. The Lenders, however, in their
unanimous discretion, may elect to make Revolving Loans or issue or arrange to
have issued Letters of Credit in excess of the Borrowing Base but not in excess
of the Maximum Revolver Amount on one or more occasions, but if they do so,
neither the Agent nor the Lenders shall be deemed thereby to have changed the
limits of the Borrowing Base or to be obligated to exceed such limits on any
other occasion. If any Borrowing would exceed Availability, the Lenders may
refuse to make or may otherwise restrict the making of Revolving Loans as the
Lenders determine until such excess has been eliminated, subject to the Agent’s
authority, in its sole discretion, to make Agent Advances pursuant to the terms
of Section 1.2(i).

(ii) The Borrowers shall execute and deliver to each Lender requesting a note, a
note, an amended and restated note, or a second amended and restated note, as
applicable, to evidence the Revolving Loan of that Lender. Each note shall be in
the principal amount of the requesting Lender’s Pro Rata Share of the Maximum
Revolver Amount, dated the date hereof and substantially in the form of
Exhibit A (each a “Note” and, collectively, the “Notes”). Each Note shall
represent the obligation of the Borrowers to pay the amount of the requesting
Lender’s Pro Rata Share of the Maximum Revolver Amount, or, if less, such
Lender’s Pro Rata Share of the aggregate unpaid principal amount of all
Revolving Loans to the Borrowers together with interest thereon as prescribed in
Section 2.1. The entire unpaid balance of the Revolving Loan and all other
Obligations (other than Bank Products that the applicable Lender chooses not to
terminate and indemnity obligations that survive the termination of this
Agreement and are not due and payable at such termination) shall be immediately
due and payable in full in immediately available funds on the Termination Date.

(b) Procedure for Borrowing.

(i) Each Borrowing shall be made upon any Borrower’s irrevocable written notice
delivered to the Agent in the form of a notice of borrowing in substantially the
form of Exhibit D (“Notice of Borrowing”) and signed by Westlake, on its behalf
and as agent for the other Borrowers, which Notice of Borrowing shall be
received by the Agent prior to (i) 12:00 noon (Houston, Texas time) three
(3) Business Days prior to the requested Funding Date, in the case of LIBOR Rate
Loans and (ii) 12:30 p.m. (Houston, Texas time) on the requested Funding Date,
in the case of Base Rate Loans, specifying:

(A) the amount of the Borrowing, which in the case of a LIBOR Rate Loan must
equal or exceed $5,000,000 (and integral increments of $1,000,000 in excess of
such amount);

(B) the requested Funding Date, which must be a Business Day;

(C) whether the Revolving Loans requested are to be Base Rate Loans or LIBOR
Rate Loans (and if not specified, it shall be deemed a request for a Base Rate
Loan);

 

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(D) the duration of the Interest Period for LIBOR Rate Loans (and if not
specified, it shall be deemed a request for an Interest Period of one month);
and

(E) the Borrower or Borrowers which are to receive all or any portion of such
Borrowing and the amount of such Borrowing to be advanced to such Borrower or
Borrowers.

(ii) In lieu of delivering a Notice of Borrowing, the Borrowers may give the
Agent telephonic notice of such request for advances to the Designated Account
on or before the deadline set forth above. The Agent at all times shall be
entitled to rely on such telephonic notice in making such Revolving Loans,
regardless of whether any written confirmation is received.

(iii) In lieu of delivering a Notice of Borrowing, the Borrowers may also
request Borrowings in accordance with any ancillary agreements entered into by
the Agent and the Borrowers from time to time relating to borrowing procedures.

(iv) The Borrowers shall have no right to request a LIBOR Rate Loan while a
Default or Event of Default has occurred and is continuing.

(c) Reliance upon Authority. Prior to the Closing Date, the Borrowers shall
deliver to the Agent, a notice setting forth the account of the Borrowers
(“Designated Account”) to which the Agent is authorized to transfer the proceeds
of the Revolving Loans requested hereunder. The Borrowers may designate a
replacement account from time to time by written notice. All such Designated
Accounts must be reasonably satisfactory to the Agent. The Agent is entitled to
rely conclusively on any person’s request for Revolving Loans on behalf of the
Borrowers, so long as the proceeds thereof are to be transferred to the
Designated Account. The Agent has no duty to verify the identity of any
individual representing himself or herself as a person authorized by the
Borrowers to make such requests on its behalf.

(d) No Liability. The Agent shall not incur any liability to the Borrowers as a
result of acting upon any notice referred to in Sections 1.2(b) and (c), which
the Agent believes in good faith to have been given by an officer or other
person duly authorized by any Borrower to request Revolving Loans on its behalf.
The crediting of Revolving Loans to the Designated Account conclusively
establishes the obligation of the Borrowers to repay such Revolving Loans as
provided herein.

(e) Notice Irrevocable. Any Notice of Borrowing (or telephonic notice in lieu
thereof) made pursuant to Section 1.2(b) shall be irrevocable. The Borrowers
shall be bound to borrow the funds requested therein in accordance therewith.

(f) Agent’s Election. Promptly after receipt of a Notice of Borrowing (or
telephonic notice in lieu thereof), the Agent shall elect to have the terms of
Section 1.2(g) or the terms of Section 1.2(h) apply to such requested Borrowing.
If the Bank declines in its sole discretion to make a Non-Ratable Loan pursuant
to Section 1.2(h), the terms of Section 1.2(g) shall apply to the requested
Borrowing.

(g) Making of Revolving Loans. If the Agent elects to have the terms of this
Section 1.2(g) apply to a requested Borrowing, then promptly after receipt of a
Notice of Borrowing or telephonic notice in lieu thereof, the Agent shall notify
the Lenders by telecopy,

 

3

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telephone or e-mail of the requested Borrowing. Each Lender shall transfer its
Pro Rata Share of the requested Borrowing available to the Agent in immediately
available funds, to the account from time to time designated by the Agent, not
later than 2:30 p.m. (Houston, Texas time) on the applicable Funding Date. After
the Agent’s receipt of all proceeds of such Revolving Loans, the Agent shall
make the proceeds of such Revolving Loans available to the Borrowers on the
applicable Funding Date by transferring same day funds to the Designated
Account; provided, however, that the amount of Revolving Loans so made on any
date shall not exceed the Availability on such date.

(h) Making of Non-Ratable Loans.

(i) If any Borrower requests a Base Rate Loan and the Agent elects, with the
consent of the Bank, to have the terms of this Section 1.2(h) apply to a
requested Borrowing, the Bank shall make a Revolving Loan in the amount of that
Borrowing available to the Borrowers on the applicable Funding Date by
transferring same day funds to the Designated Account. Each Revolving Loan made
solely by the Bank pursuant to this Section 1.2(h) is herein referred to as a
“Non-Ratable Loan,” and such Revolving Loans are collectively referred to as the
“Non-Ratable Loans.” Each Non-Ratable Loan shall be subject to all the terms and
conditions applicable to other Revolving Loans except that all payments thereon
shall be payable to the Bank solely for its own account. The aggregate amount of
Non-Ratable Loans outstanding at any time shall not exceed $40,000,000. The
Agent shall not request the Bank to make any Non-Ratable Loan if (1) the Agent
has received written notice from any Lender that one or more of the applicable
conditions precedent set forth in Article 8 will not be satisfied on the
requested Funding Date for the applicable Borrowing, or (2) the requested
Borrowing would exceed Availability on that Funding Date.

(ii) The Non-Ratable Loans shall be secured by the Agent’s Liens in and to the
Collateral and shall constitute Base Rate Loans and Obligations hereunder.

(i) Agent Advances.

(i) Subject to the limitations set forth below, the Agent is authorized by the
Borrowers and the Lenders, from time to time in the Agent’s sole discretion,
(A) after the occurrence of a Default or an Event of Default, or (B) at any time
that any of the other conditions precedent set forth in Article 8 have not been
satisfied, to make Base Rate Loans to the Borrowers on behalf of the Lenders in
an aggregate amount outstanding at any time not to exceed 5% of the Borrowing
Base but not in excess of the Maximum Revolver Amount which the Agent, in its
reasonable business judgment, deems necessary or desirable (1) to preserve or
protect the Collateral, or any portion thereof, (2) to enhance the likelihood
of, or maximize the amount of, repayment of the Revolving Loans and other
Obligations, or (3) to pay any other amount chargeable to the Borrowers pursuant
to the terms of this Agreement, including costs, fees, and expenses as described
in Section 13.7 (any of such advances are herein referred to as “Agent
Advances”); provided, that the Majority Lenders may at any time revoke the
Agent’s authorization to make Agent Advances. Any such revocation must be in
writing and shall become effective prospectively upon the Agent’s receipt
thereof.

(ii) The Agent Advances shall be secured by the Agent’s Liens in and to the
Collateral and shall constitute Base Rate Loans and Obligations hereunder.

 

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(j) Increase in Commitments. The Borrowers may request an increase in the
Commitments from time to time upon notice to the Agent, as long as (a) the
requested increase is in a minimum amount of $25,000,000 and is offered on the
same terms as existing Commitments, except for a closing fee specified by the
Borrowers, (b) increases under this Section do not exceed $150,000,000 in the
aggregate and no more than four (4) increases are made, (c) no reduction in
Commitments pursuant to Section 3.2 has occurred prior to the requested
increase, (d) the Agent shall have received certified copies of the resolutions
of Westlake approving such increase in the Commitments, (e) the increased
Commitments shall be on the same terms and conditions as the existing
Commitments, (f) the Borrowers shall deliver any legal opinions or other
documents reasonably requested by the Agent, and (g) the Borrowers shall pay, on
demand, all fees and reasonable costs and expenses (including Attorney Costs)
paid or incurred by the Agent and the Arranger in connection with the increase
in the Commitments. The Agent shall promptly notify Lenders of the requested
increase and, within ten (10) Business Days thereafter, each Lender shall notify
the Agent if and to what extent such Lender commits to increase its Commitment;
provided that no Lender shall have any obligation to increase its Commitment.
Any Lender not responding within such period shall be deemed to have declined an
increase. If Lenders fail to commit to the full requested increase, Eligible
Assignees may issue additional Commitments and become Lenders hereunder. The
Agent may allocate, in its discretion, the increased Commitments among
committing Lenders and, if necessary, Eligible Assignees. Provided the
conditions set forth in Section 8.2 are satisfied, total Commitments shall be
increased by the requested amount (or such lesser amount committed by Lenders
and Eligible Assignees) on a date agreed upon by the Agent and the Borrowers,
but no later than forty-five (45) days following the Borrowers’ increase
request. The Agent, the Borrowers, and new and existing Lenders shall execute
and deliver such documents and agreements as the Agent deems appropriate to
evidence the increase in and allocations of the Commitments. On the effective
date of an increase, all outstanding Revolving Loans, Letter of Credit
Obligations and other exposures shall be reallocated among Lenders, and settled
by the Agent if necessary, in accordance with Lenders’ adjusted shares of such
Commitments.

1.3 Letters of Credit.

(a) Agreement to Issue. Subject to the terms and conditions of this Agreement,
each Letter of Credit Issuer, as requested by any Borrower, agrees to issue, and
to amend or renew Letters of Credit previously issued by it in accordance with
this Section 1.3, for the account of any Borrower one or more
commercial/documentary and standby letters of credit (each a “Letter of Credit”
and collectively, the “Letters of Credit”) and the Agent agrees to provide
credit support or other enhancement to a letter of credit issuer acceptable to
the Agent, which issues a letter of credit for the account of any Borrower (any
such credit support or enhancement being herein referred to as a “Credit
Support”) from time to time during the term of this Agreement. All Existing
Letters of Credit shall be deemed to have been issued pursuant hereto, and from
and after the Closing Date shall be subject to and governed by the terms and
conditions hereof.

(b) Amounts; Outside Expiration Date. A Letter of Credit Issuer shall not have
any obligation to issue any Letter of Credit and the Agent shall not have any
obligation to provide Credit Support at any time if: (i) the maximum face amount
of the requested Letter of Credit is greater than the Unused Letter of Credit
Subfacility at such time; (ii) the maximum undrawn amount of the requested
Letter of Credit and all commissions, fees, and charges due from the Borrowers
in connection with the opening thereof would exceed Availability at such time;
or (iii) such Letter of Credit has an expiration date less than thirty (30) days
prior to the Stated Termination Date or more than twelve (12) months from the
date of issuance for standby letters of credit and 180 days from the date of
issuance for documentary letters of credit; provided that

 

5

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any Letter of Credit issued in connection with the IRBs may have an expiration
date of not later than the Termination Date. With respect to any Letter of
Credit which contains any “evergreen” or automatic renewal provision, each
Lender shall be deemed to have consented to any such extension or renewal unless
any such Lender shall have provided to the Agent, written notice that it
declines to consent to any such extension or renewal at least thirty (30) days
prior to the date on which the applicable Letter of Credit Issuer is entitled to
decline to extend or renew the Letter of Credit. If all of the requirements of
this Section 1.3 are met and no Default or Event of Default has occurred and is
continuing, no Lender shall decline to consent to any such extension or renewal.

(c) Other Conditions. In addition to conditions precedent contained in Article
8, the obligation of a Letter of Credit Issuer to issue any Letter of Credit and
the obligation of the Agent to provide Credit Support is subject to the
following conditions precedent having been satisfied in a manner reasonably
satisfactory to the Agent:

(i) The Borrowers shall have delivered to the applicable Letter of Credit
Issuer, at such times and in such manner as such Letter of Credit Issuer may
prescribe, an application in form and substance satisfactory to such Letter of
Credit Issuer and reasonably satisfactory to the Agent for the issuance of the
Letter of Credit and such other documents as may be required pursuant to the
terms thereof, and the form, terms and purpose of the proposed Letter of Credit
shall be reasonably satisfactory to the Agent and such Letter of Credit Issuer;
and

(ii) If a Defaulting Lender exists, no Letter of Credit Issuer shall have any
obligation to issue any Letter of Credit and the Agent shall not have any
obligation to provide any Credit Support, until such Lender or the Borrowers
have entered into arrangements satisfactory to the Agent and the applicable
Letter of Credit Issuer to eliminate any Fronting Exposure associated with the
Defaulting Lender; and

(iii) As of the date of issuance, no order of any court, arbitrator or
Governmental Authority shall purport by its terms to enjoin or restrain money
center banks generally from issuing letters of credit of the type and in the
amount of the proposed Letter of Credit, and no law, rule or regulation
applicable to money center banks generally and no request or directive (whether
or not having the force of law) from any Governmental Authority with
jurisdiction over money center banks generally shall prohibit, or request that
the proposed Letter of Credit Issuer refrain from, the issuance of letters of
credit generally or the issuance of such Letters of Credit.

(d) Issuance of Letters of Credit.

(i) Request for Issuance. The Borrowers must notify the Agent of a requested
Letter of Credit at least three (3) Business Days prior to the proposed issuance
date. Such notice shall be irrevocable and must specify the proposed Letter of
Credit Issuer, the original face amount of the Letter of Credit requested, the
Business Day of issuance of such requested Letter of Credit, whether such Letter
of Credit is standby, commercial, or documentary, whether such Letter of Credit
may be drawn in a single or in partial draws, the Business Day on which the
requested Letter of Credit is to expire, the purpose for which such Letter of
Credit is to be issued, and the beneficiary of the requested Letter of Credit.
The Borrowers shall attach to such notice the proposed form of the Letter of
Credit.

 

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(ii) Responsibilities of the Agent; Issuance. As of the Business Day immediately
preceding the requested issuance date of the Letter of Credit, the Agent shall
determine the amount of the applicable Unused Letter of Credit Subfacility and
Availability. If (A) the face amount of the requested Letter of Credit is less
than the Unused Letter of Credit Subfacility and (B) the amount of such
requested Letter of Credit and all commissions, fees, and charges due from the
Borrowers in connection with the opening thereof would not exceed Availability,
the Agent shall notify the applicable Letter of Credit Issuer and such Letter of
Credit Issuer shall issue the requested Letter of Credit on the requested
issuance date so long as the other conditions hereof are met. No Letter of
Credit Issuer shall issue any Letter of Credit without receiving prior notice or
confirmation from the Agent that the foregoing clauses (A) and (B) are met.

(iii) No Extensions or Amendment. No Letter of Credit Issuer shall be obligated
to extend or amend any Letter of Credit issued pursuant hereto unless the
requirements of this Section 1.3 are met as though a new Letter of Credit were
being requested and issued.

(e) Assumption of Risk; Rights of Letter of Credit Issuers.

(i) Assumption of Risk by the Borrowers. The Borrowers assume all risks of the
acts, omissions or misuses of any Letter of Credit by the beneficiary. In
connection with issuance of any Letter of Credit, none of the Agent, any Letter
of Credit Issuer or any Lender shall be responsible for the existence,
character, quality, quantity, condition, packing, value or delivery of any goods
purported to be represented by any Letter of Credit Documents; any differences
or variation in the character, quality, quantity, condition, packing, value or
delivery of any goods from that expressed in any documents; the form, validity,
sufficiency, accuracy, genuineness or legal effect of any documents or of any
endorsements thereon; the time, place, manner or order in which shipment of
goods is made; partial or incomplete shipment of, or failure to ship, any goods
referred to in a Letter of Credit or any Letter of Credit Documents; any
deviation from instructions, delay, default or fraud by any shipper or other
Person in connection with any goods, shipment or delivery; any breach of
contract between a shipper or vendor and a Borrower; errors, omissions,
interruptions or delays in transmission or delivery of any messages, by mail,
cable, telegraph, telex, telecopy, e-mail, telephone or otherwise; errors in
interpretation of technical terms; the misapplication by a beneficiary of any
Letter of Credit or the proceeds thereof; or any consequences arising from
causes beyond the control of any Letter of Credit Issuer, the Agent or any
Lender, including any act or omission of a Governmental Authority. The rights
and remedies of the Letter of Credit Issuers under the Loan Documents shall be
cumulative. The Letter of Credit Issuers shall be fully subrogated to the rights
and remedies of each beneficiary whose claims against the Borrowers are
discharged with proceeds of any Letter of Credit. Nothing set forth herein shall
prevent the Borrowers, following reimbursement in respect of any Letter of
Credit, from asserting claims against a Letter of Credit Issuer for any honor of
any Letter of Credit constituting gross negligence or willful misconduct.

(ii) Rights of Letter of Credit Issuers. In connection with its administration
of and enforcement of rights or remedies under any Letters of Credit or Letter
of Credit Documents, a Letter of Credit Issuer shall be entitled to act, and
shall be fully protected in acting, upon any certification, documentation or
communication in whatever form believed by such Letter of Credit Issuer, in good
faith, to be genuine and correct and to have been signed, sent or made by a
proper Person. A Letter of Credit Issuer may consult

 

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with and employ legal counsel, accountants and other experts to advise it
concerning its obligations, rights and remedies, and shall be entitled to act
upon, and shall be fully protected in any action taken in good faith reliance
upon, any advice given by such experts. A Letter of Credit Issuer may employ
agents and attorneys-in-fact in connection with any matter relating to Letters
of Credit or Letter of Credit Documents, and shall not be liable for the
negligence or misconduct of agents and attorneys-in-fact selected with
reasonable care.

(iii) Account Party. The Borrowers hereby authorize and direct any Letter of
Credit Issuer to name any Borrower as the “Account Party” therein and to deliver
to the Agent all instruments, documents, and other writings and property
received by such Letter of Credit Issuer pursuant to the Letter of Credit, and
to accept and rely upon the Agent’s instructions and agreements with respect to
all matters arising in connection with the Letter of Credit or the application
therefor.

(f) Reimbursement; Participations.

(i) If any Letter of Credit Issuer honors any request for payment under a Letter
of Credit, the Borrowers shall pay to such Letter of Credit Issuer, on the same
day (“Reimbursement Date”), the amount paid by such Letter of Credit Issuer
under such Letter of Credit, together with interest at the interest rate for
Base Rate Loans from the Reimbursement Date until payment by the Borrowers. The
obligation of the Borrowers to reimburse a Letter of Credit Issuer for any
payment made under a Letter of Credit shall be absolute, unconditional,
irrevocable, and joint and several, and shall be paid without regard to any lack
of validity or enforceability of any Letter of Credit or the existence of any
claim, setoff, defense or other right that the Borrowers may have at any time
against the beneficiary. Whether or not the Borrowers submit a Notice of
Borrowing, the Borrowers shall be deemed to have requested a Borrowing of Base
Rate Loans in an amount necessary to pay all amounts due a Letter of Credit
Issuer on any Reimbursement Date and each Lender agrees to fund its Pro Rata
Share of such Borrowing whether or not the Commitments have terminated, an
overadvance exists or is created thereby, or the conditions in Article 8 are
satisfied.

(ii) Upon issuance of a Letter of Credit, each Lender shall be deemed to have
irrevocably and unconditionally purchased from the applicable Letter of Credit
Issuer, without recourse or warranty, an undivided Pro Rata Share interest and
participation in all Letter of Credit Obligations relating to such Letter of
Credit. If a Letter of Credit Issuer makes any payment under a Letter of Credit
and the Borrowers do not reimburse such payment on the Reimbursement Date, the
Agent shall promptly notify the Lenders and each Lender shall promptly (within
one Business Day) and unconditionally pay to the Agent, for the benefit of such
Letter of Credit Issuer, the Lender’s Pro Rata Share of such payment. Upon
request by a Lender, a Letter of Credit Issuer shall furnish copies of any
Letters of Credit and Letter of Credit Documents in its possession at such time.

(iii) The obligation of each Lender to make payments to the Agent for the
account of a Letter of Credit Issuer in connection with such Letter of Credit
Issuer’s payment under a Letter of Credit shall be absolute, unconditional and
irrevocable, not subject to any counterclaim, setoff, qualification or exception
whatsoever, and shall be made in accordance with this Agreement under all
circumstances, irrespective of any lack of validity or unenforceability of any
Loan Documents; any draft, certificate or other document presented under a
Letter of Credit having been determined to be forged,

 

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fraudulent, invalid or insufficient in any respect or any statement therein
being untrue or inaccurate in any respect; or the existence of any setoff or
defense that any Obligor may have with respect to any Obligations. The Letter of
Credit Issuers do not assume any responsibility for any failure or delay in
performance or any breach by any Borrower or other Person of any obligations
under any Letter of Credit Documents. The Letter of Credit Issuers do not make
to Lenders any express or implied warranty, representation or guaranty with
respect to the Collateral, the Letter of Credit Documents or any Account Party.
The Letter of Credit Issuers shall not be responsible to any Lender for any
recitals, statements, information, representations or warranties contained in,
or for the execution, validity, genuineness, effectiveness or enforceability of
any Letter of Credit Documents; the validity, genuineness, enforceability,
collectibility, value or sufficiency of any Collateral or the perfection of any
Lien therein; or the assets, liabilities, financial condition, results of
operations, business, creditworthiness or legal status of any Account Party.

(iv) No Letter of Credit Indemnitee shall be liable to any Lender or other
Person for any action taken or omitted to be taken in connection with any Letter
of Credit Documents except as a result of its actual gross negligence or willful
misconduct. A Letter of Credit Issuer shall not have any liability to any Lender
if such Letter of Credit Issuer refrains from any action under a Letter of
Credit or LC Documents until it receives written instructions from Required
Lenders.

(g) Supporting Letter of Credit; Cash Collateral. (i) If, notwithstanding the
provisions of Section 1.3(b) and Section 10.1, any Letter of Credit or Credit
Support is outstanding upon the termination of this Agreement, then upon such
termination the Borrowers shall deposit with the Agent, for the ratable benefit
of the Agent and the Lenders, with respect to each Letter of Credit or Credit
Support then outstanding, a standby letter of credit (a “Supporting Letter of
Credit”) in form and substance satisfactory to the Agent, issued by an issuer
satisfactory to the Agent in an amount equal to the greatest amount for which
such Letter of Credit or such Credit Support may be drawn plus any fees and
expenses associated with such Letter of Credit or such Credit Support, under
which Supporting Letter of Credit the Agent is entitled to draw amounts
necessary to reimburse the Agent and the Lenders for payments to be made by the
Agent and the Lenders under such Letter of Credit or Credit Support and any fees
and expenses associated with such Letter of Credit or Credit Support. Such
Supporting Letter of Credit shall be held by the Agent, for the ratable benefit
of the Agent and the Lenders, as security for, and to provide for the payment
of, the aggregate undrawn amount of such Letters of Credit or such Credit
Support remaining outstanding. In the event Supporting Letters of Credit are not
delivered, then the Loan Parties shall provide cash collateral for all remaining
Letters of Credit in an amount equal to 110% of the aggregate face amount of
such Letters of Credit. (ii) If a Defaulting Lender exists, the Borrowers shall,
on demand by any Letter of Credit Issuer or the Agent from time to time, cash
collateralize the Pro Rata Share of any Defaulting Lender of the Letter of
Credit Obligations.

(h) Auto-Reinstatement Letters of Credit. The Lenders acknowledge that the
Letter of Credit issued by the Bank in connection with the IRBs (as amended,
renewed, replaced, and extended from time to time, the “IRB L/C”) permits the
automatic reinstatement of all or a portion of the stated amount thereof after
any drawing thereunder. Unless otherwise directed by the Bank, no Borrower shall
be required to make a specific request to the Bank to permit such reinstatement.
The Lenders shall be deemed to have authorized (but may not require) the Bank to
reinstate all or a portion of the stated amount thereof in accordance with the
provisions of the IRB L/C.

 

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(i) Additional Letter of Credit Issuers. The Borrowers and all Additional Letter
of Credit Issuers shall comply with all terms and conditions relating to Letters
of Credit set forth in this Agreement, including without limitation,
Section 1.3(d)(i) above. Each Additional Letter of Credit Issuer shall promptly
provide to the Agent a copy of all original Letters of Credit issued by such
Additional Letter of Credit Issuer, and all renewals, extensions, amendments,
modifications, cancellations, or draws thereof. Each Additional Letter of Credit
Issuer shall only issue a Letter of Credit in accordance with this Section 1.3.

(j) Resignation of Letter of Credit Issuer. Any Letter of Credit Issuer may
resign at any time upon notice to the Agent and the Borrowers. On the effective
date of such resignation, such Letter of Credit Issuer shall have no further
obligation to issue, amend, renew, extend or otherwise modify any Letter of
Credit, but shall continue to have all rights and obligations of a Letter of
Credit Issuer hereunder, including under Sections 1.3 and 13.11, relating to any
Letter of Credit issued prior to such date. The Agent shall promptly appoint a
replacement Letter of Credit Issuer, which, as long as no Default or Event of
Default exists, shall be reasonably acceptable to Borrowers.

1.4 Bank Products. The Loan Parties and their Affiliates (including Westlake
Veba Trust) may request and the Agent or Lenders may, in their sole and absolute
discretion, arrange for the Loan Parties and their Affiliates (including
Westlake Veba Trust) to obtain from the Bank or the Bank’s Affiliates or the
Lenders or the Lenders’ Affiliates, Bank Products, although the Loan Parties and
their Affiliates (including Westlake Veba Trust) are not required to do so. If
Bank Products are provided by an Affiliate of the Bank, any Lender or an
Affiliate of a Lender, the Loan Parties agree to indemnify and hold the Agent,
the Bank, the Lenders, and their respective Affiliates harmless from any and all
costs and obligations now or hereafter incurred by the Agent, the Bank, or any
of the Lenders and their respective Affiliates which arise from any indemnity
given by the Agent, its Affiliates, or the Lenders or their respective
Affiliates related to such Bank Products; provided, however, nothing contained
herein is intended to limit any Loan Party’s rights, with respect to the Bank,
any Lender or their respective Affiliates, as the case may be, which relate to
the Bank Products or the provision of the Bank Products pursuant thereto. The
agreement contained in this Section shall survive termination of this Agreement.
Each Loan Party acknowledges and agrees that the obtaining of Bank Products from
the Bank, any Lender or their respective Affiliates (a) is in the sole and
absolute discretion of the Bank, any Lender, or their respective Affiliates, and
(b) is subject to all rules and regulations of the Bank, any Lender, or their
respective Affiliates.

ARTICLE 2.

INTEREST AND FEES

2.1 Interest.

(a) Interest Rates. All outstanding Revolving Loans shall bear interest on the
unpaid principal amount thereof (including, to the extent permitted by law, on
interest thereon not paid when due) from the date made until paid in full in
cash at a rate determined by reference to the Base Rate or the LIBOR Rate plus
the Applicable Margin, but not to exceed the Maximum Rate. If at any time
Revolving Loans are outstanding with respect to which the Borrowers have not
delivered to the Agent a notice specifying the basis for determining the
interest rate applicable thereto in accordance herewith, those Revolving Loans
shall bear interest at a rate determined by reference to the Base Rate (unless
the Default Rate has been effected by the Agent and the Required Lenders
pursuant to Section 2.1(b)) until notice to the contrary has been given to the
Agent in accordance with this Agreement and such notice has become effective.
Except as otherwise provided herein, the outstanding Revolving Loans shall bear
interest as follows:

(i) For all Base Rate Loans at a fluctuating per annum rate equal to the Base
Rate plus the Applicable Margin; and

 

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(ii) For all LIBOR Rate Loans at a per annum rate equal to the LIBOR Rate plus
the Applicable Margin.

Each change in the Base Rate shall be reflected in the interest rate applicable
to Base Rate Loans as of the effective date of such change. All interest charges
for LIBOR Rate Loans shall be computed on the basis of a year of 360 days and
actual days elapsed (which results in more interest being paid than if computed
on the basis of a 365-day year). All interest charges for Base Rate Loans shall
be computed on the basis of a year of 365 or 366 days, as the case may be, and
for actual days elapsed. The Borrowers shall pay to the Agent, for the ratable
benefit of Lenders, interest accrued on all Base Rate Loans in arrears on the
first day of each month hereafter and on the Termination Date. The Borrowers
shall pay to the Agent, for the ratable benefit of Lenders, interest on all
LIBOR Rate Loans in arrears on each LIBOR Interest Payment Date.

(b) Default Rate. If any Event of Default occurs and is continuing and the Agent
or the Required Lenders in their discretion so elect, then, while any such Event
of Default is continuing, (i) the principal amount of all Revolving Loans shall
bear interest at the Default Rate applicable thereto; (ii) the Letter of Credit
Fee shall bear interest at the Default Rate applicable thereto; and (iii) any
other amount (other than principal of any Revolving Loan and the Letter of
Credit Fee) payable by the Borrowers under any Loan Document shall bear interest
at the Default Rate applicable to Base Rate Loans.

2.2 Continuation and Conversion Elections.

(a) The Borrowers may:

(i) elect, as of any Business Day, in the case of Base Rate Loans, to convert
any Base Rate Loans (or any part thereof in an amount not less than $5,000,000,
or that is in an integral multiple of $1,000,000 in excess thereof) into LIBOR
Rate Loans; or

(ii) elect, as of the last day of the applicable Interest Period, to continue
any LIBOR Rate Loans having Interest Periods expiring on such day (or any part
thereof in an amount not less than $1,000,000, or that is in an integral
multiple of $1,000,000 in excess thereof);

provided, that if at any time the aggregate amount of LIBOR Rate Loans in
respect of any Borrowing is reduced, by payment, prepayment, or conversion of
part thereof to be less than $1,000,000, such LIBOR Rate Loans shall
automatically convert into Base Rate Loans; provided further that if the notice
shall fail to specify the duration of the Interest Period, such Interest Period
shall be one (1) month.

(b) Westlake, on its behalf and as agent for the other Borrowers, shall deliver
a notice of continuation/conversion (“Notice of Continuation/Conversion”) to the
Agent not later than 12:00 noon (Houston, Texas time) at least three
(3) Business Days in advance of the Continuation/Conversion Date, if the
Revolving Loans are to be converted into or continued as LIBOR Rate Loans and
specifying:

(i) the proposed Continuation/Conversion Date;

(ii) the aggregate amount of Loans to be converted or continued;

 

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(iii) the type of Loans resulting from the proposed conversion or continuation;
and

(iv) the duration of the requested Interest Period, provided, however, the
Borrowers may not select an Interest Period that ends after the Stated
Termination Date.

(c) If upon the expiration of any Interest Period applicable to LIBOR Rate
Loans, the Borrowers have failed to select timely a new Interest Period to be
applicable to LIBOR Rate Loans, the Borrowers shall be deemed to have elected to
convert such LIBOR Rate Loans into Base Rate Loans effective as of the
expiration date of such Interest Period.

(d) The Agent will promptly notify each Lender of its receipt of a Notice of
Continuation/Conversion. All conversions and continuations shall be made ratably
according to the respective outstanding principal amounts of the Revolving Loans
with respect to which the notice was given held by each Lender.

(e) There may not be more than twelve (12) different LIBOR Rate Loans in effect
hereunder at any time.

2.3 Maximum Interest Rate. In no event shall any interest rate provided for
hereunder (including any fees or other fees or other compensation which are
deemed or determined to be interest) exceed the maximum rate legally chargeable
by any Lender under applicable law for such Lender with respect to loans of the
type provided for hereunder (the “Maximum Rate”). If, for any period, any
interest, absent such limitation, would have exceeded the Maximum Rate, then the
interest rate for that period shall be the Maximum Rate, and, if in future
periods, that interest rate would otherwise be less than the Maximum Rate, then
that interest rate shall remain at the Maximum Rate until such time as the
amount of interest paid hereunder equals the amount of interest which would have
been paid if the same had not been limited by the Maximum Rate. In the event
that, upon payment in full of the Obligations, the total amount of interest paid
or accrued under the terms of this Agreement is less than the total amount of
interest which would, but for this Section 2.3, have been paid or accrued if the
interest rate otherwise set forth in this Agreement had at all times been in
effect, then the Borrowers shall, to the extent permitted by applicable law, pay
the Agent, for the account of the Lenders, an amount equal to the excess of
(a) the lesser of (i) the amount of interest which would have been charged if
the Maximum Rate had, at all times, been in effect or (ii) the amount of
interest which would have accrued had the interest rate otherwise set forth in
this Agreement, at all times, been in effect over (b) the amount of interest
actually paid or accrued under this Agreement. If a court of competent
jurisdiction determines that the Agent and/or any Lender has received interest
and other charges hereunder in excess of the Maximum Rate, such excess shall be
deemed received on account of, and shall automatically be applied to reduce, the
Obligations other than interest, in the inverse order of maturity, and if there
are no Obligations outstanding, the Agent and/or such Lender shall refund to the
Borrowers such excess.

2.4 Closing Fee. Borrowers shall pay the Agent for its account the fees
described in the Fee Letter (the “Closing Fee”).

2.5 Unused Line Fee. On the first day of each month hereafter and on the
Termination Date, the Borrowers agree to pay to the Agent, for the account of
the Lenders, in accordance with their respective Pro Rata Shares, an unused line
fee (the “Unused Line Fee”) equal to the Applicable Margin for Unused Line Fee
times the amount by which the Maximum Revolver Amount exceeded the sum of the
average daily outstanding principal amount of Revolving Loans and the average
daily undrawn face amount of outstanding Letters of Credit, during the
immediately preceding month or shorter period if calculated for the first month
hereafter or on the Termination Date. The Unused Line Fee shall be

 

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computed on the basis of a 360-day year for the actual number of days elapsed.
All principal payments received by the Agent shall be deemed to be credited to
the Borrowers’ Loan Account immediately upon receipt for purposes of calculating
the Unused Line Fee pursuant to this Section 2.5.

2.6 Letter of Credit Fee. The Borrowers agree to pay (a) to the Agent, for the
account of the Lenders, in accordance with their respective Pro Rata Shares, for
each Letter of Credit, a per annum fee (the “Letter of Credit Fee”) equal to the
Applicable Margin for LIBOR Rate Loans multiplied by the stated amount of each
Letter of Credit, (b) on the date of issuance of any Letter of Credit, to the
Agent for the benefit of the applicable Letter of Credit Issuer, a fronting fee
of one-eighth of one percent (0.125%) per annum of the undrawn face amount of
each Letter of Credit, and (c) on the date of issuance of any Letter of Credit,
to the applicable Letter of Credit Issuer, all out-of-pocket costs, fees and
expenses incurred by such Letter of Credit Issuer in connection with the
application for, processing of, issuance of, or amendment to any Letter of
Credit. The Letter of Credit Fee shall be payable monthly in arrears on the
first day of each month following any month in which a Letter of Credit is
outstanding and on the Termination Date. The Letter of Credit Fee shall be
computed on the basis of a 360-day year for the actual number of days elapsed.

ARTICLE 3.

PAYMENTS AND PREPAYMENTS

3.1 Revolving Loans. The Borrowers shall repay the outstanding principal balance
of the Revolving Loans, plus all accrued but unpaid interest thereon, on the
Termination Date. The Borrowers may prepay Revolving Loans at any time, and
reborrow subject to the terms of this Agreement. In addition, and without
limiting the generality of the foregoing, upon demand, the Borrowers shall pay
to the Agent, for account of the Lenders, the amount, without duplication, by
which the Aggregate Revolver Outstandings exceeds the lesser of the Borrowing
Base or the Maximum Revolver Amount.

3.2 Full or Partial Termination of Facility.

(a) Termination of Facility. The Borrowers may terminate this Agreement upon at
least ten (10) Business Days’ notice (or such shorter period as agreed to by the
Agent in its sole discretion) to the Agent, upon Full Payment of all Obligations
(other than Bank Products that the applicable Lender chooses not to terminate
and indemnity obligations that survive the termination of this Agreement and are
not due and payable at such termination). On the effective date of termination
of this Agreement, any Lender may terminate its and its Affiliates’ Bank
Products.

(b) Partial Reduction of Facility. The Borrowers may permanently reduce the
Maximum Revolver Amount in increments of $25,000,000 but in no event shall the
Maximum Revolver Amount be less than $300,000,000 (the amount of such reduction,
the “Partial Termination Amount”) upon at least ten (10) days’ notice to the
Agent, upon the payment in full of any Revolving Loans, together with accrued
interest thereon, to the extent such Revolving Loans exceed the Maximum Revolver
Amount (after giving effect to such reduction). Once reduced in accordance with
this Section 3.2(b), the Maximum Revolver Amount may not be increased.

3.3 Prepayments of the Loans.

(a) To the extent set forth in this Section 3.3(a), immediately upon receipt by
any Loan Party of proceeds from the sale of any Collateral (other than sales of
Inventory in the ordinary course of business), the Borrowers shall prepay the
Revolving Loans in an amount equal to 100% of all such proceeds, net of
(i) commissions and other reasonable and customary

 

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transaction costs, fees, and expenses properly attributable to such transaction
and payable by such Loan Party in connection therewith (in each case, paid to
non-Affiliates), (ii) transfer taxes, and (iii) appropriate amounts required to
be reserved (in accordance with GAAP) for post-closing adjustments by any Loan
Party in connection with such transaction, against any liabilities retained by
any Loan Party after such transaction, which liabilities are associated with the
asset or assets sold (“Net Sale Proceeds”). No payment from the Net Sale
Proceeds shall be required hereunder to the extent Availability exceeds the
amount of Revolving Loans outstanding on such date of determination. In
addition, 100% of the Net Sale Proceeds shall be deducted from the calculation
of the Borrowing Base, but such reduction shall not be deemed to be a permanent
reduction of the Maximum Revolver Amount.

(b) Prepayments from the proceeds of all dispositions of Collateral in
accordance with Section 3.3(a) shall be applied as follows: first, to accrued
interest with respect to the Revolving Loans, second, to pay the principal of
the Revolving Loans, and third to cash collateralize outstanding Letters of
Credit.

3.4 LIBOR Rate Loan Prepayments. In connection with any prepayment, if any LIBOR
Rate Loans are prepaid prior to the expiration date of the Interest Period
applicable thereto, the Borrowers shall pay to the Lenders the amounts described
in Section 4.4.

3.5 Payments by the Borrowers.

(a) All payments to be made by the Borrowers shall be made without set off,
recoupment or counterclaim. Except as otherwise expressly provided herein, all
payments by the Borrowers shall be made to the Agent for the account of the
Lenders, at the account designated by the Agent and shall be made in Dollars and
in immediately available funds, no later than 12:00 noon (Houston, Texas time)
on the date specified herein. Any payment received by the Agent after such time
shall be deemed (for purposes of calculating interest only) to have been
received on the following Business Day and any applicable interest shall
continue to accrue.

(b) Subject to the provisions set forth in the definition of “Interest Period,”
whenever any payment is due on a day other than a Business Day, such payment
shall be due on the following Business Day, and such extension of time shall in
such case be included in the computation of interest or fees, as the case may
be.

3.6 Payments as Revolving Loans. At the election of the Agent, all payments of
principal, interest, reimbursement obligations in connection with Letters of
Credit and Credit Support, fees, premiums, reimbursable expenses and other sums
payable hereunder, may be paid from the proceeds of Revolving Loans made
hereunder. The Borrowers hereby irrevocably authorize the Agent to charge the
Loan Account for the purpose of paying all amounts from time to time due
hereunder (without regard to any grace periods hereunder, including, without
limitation, Loans that constitute Agent Advances) and agrees that all such
amounts charged shall constitute Revolving Loans (including Non-Ratable Loans
and Agent Advances).

3.7 Apportionment, Application and Reversal of Payments. Principal and interest
payments shall be apportioned ratably among the Lenders (according to the unpaid
principal balance of the Revolving Loans to which such payments relate held by
each Lender) and payments of the fees shall, as applicable, be apportioned
ratably among the Lenders, except for fees payable solely to the Agent and the
Letter of Credit Issuers and except as provided in Section 11.1(b) or 12.14(e).
All payments shall be remitted to the Agent and all such payments not relating
to principal or interest of specific Loans, or not constituting payment of
specific fees, and all proceeds of Accounts or other Collateral received by the

 

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Agent following the occurrence and during the continuation of any Event of
Default shall be applied, ratably, subject to the provisions of this Agreement,
first, to pay any fees, indemnities, or expense reimbursements then due to the
Agent from the Borrowers (other than any fees, indemnities, or expense
reimbursements arising under any Bank Product); second, to pay any fees or
expense reimbursements then due to the Lenders from the Borrowers (other than
any fees or expense arising from any Bank Product); third, to pay interest due
in respect of all Loans, including Non-Ratable Loans and Agent Advances; fourth,
to pay or prepay principal of the Non-Ratable Loans and Agent Advances; fifth,
to pay or prepay principal of the Revolving Loans (other than Non-Ratable Loans
and Agent Advances), unpaid reimbursement obligations in respect of Letters of
Credit, and Pari Passu Bank Product Obligations; sixth, to pay an amount to the
Agent equal to all outstanding Letter of Credit Obligations to be held as cash
collateral for such Obligations; and seventh, to the payment of any other
Obligations including any amounts relating to Bank Products due to the Agent,
any Lender, or their respective Affiliates by the Borrowers that are not Pari
Passu Bank Product Obligations. Notwithstanding anything to the contrary
contained in this Agreement, unless so directed by the Borrowers, or unless an
Event of Default has occurred and is continuing, neither the Agent nor any
Lender shall apply any payments which it receives to any LIBOR Rate Loan, except
(a) on the expiration date of the Interest Period applicable to any such LIBOR
Rate Loan, or (b) in the event, and only to the extent, that there are no
outstanding Base Rate Loans and, in any event, the Borrowers shall pay LIBOR
breakage losses in accordance with Section 4.4. To the extent not inconsistent
with the express terms of this Agreement, the Agent and the Lenders shall have
the continuing and exclusive right to apply and reverse and reapply any and all
such proceeds and payments to any portion of the Obligations.

3.8 Indemnity for Returned Payments. If after receipt of any payment which is
applied to the payment of all or any part of the Obligations, the Agent, any
Lender, the Bank or any Affiliate of the Bank is for any reason compelled to
surrender such payment or proceeds to any Person because such payment or
application of proceeds is invalidated, declared fraudulent, set aside,
determined to be void or voidable as a preference, impermissible setoff, or a
diversion of trust funds, or for any other reason, then the Obligations or part
thereof intended to be satisfied shall be revived and continued and this
Agreement shall continue in full force as if such payment or proceeds had not
been received by the Agent or such Lender and the Borrowers shall be liable to
pay to the Agent and the Lenders, and hereby do indemnify the Agent and the
Lenders and hold the Agent and the Lenders harmless for the amount of such
payment or proceeds surrendered. The provisions of this Section 3.8 shall be and
remain effective notwithstanding any contrary action which may have been taken
by the Agent or any Lender in reliance upon such payment or application of
proceeds, and any such contrary action so taken shall be without prejudice to
the Agent’s and the Lenders’ rights under this Agreement and shall be deemed to
have been conditioned upon such payment or application of proceeds having become
final and irrevocable. The provisions of this Section 3.8 shall survive the
termination of this Agreement.

3.9 Agent’s and Lenders’ Books and Records; Monthly Statements. The Agent shall
record the principal amount of the Revolving Loans owing to each Lender, the
undrawn face amount of all outstanding Letters of Credit and the aggregate
amount of unpaid reimbursement obligations outstanding with respect to the
Letters of Credit from time to time on its books. In addition, each Lender may
note the date and amount of each payment or prepayment of principal of such
Lender’s Loans in its books and records. Failure by the Agent or any Lender to
make such notation shall not affect the obligations of the Borrowers with
respect to the Revolving Loans or the Letters of Credit. Each Borrower agrees
that the Agent’s and each Lender’s books and records showing the Obligations and
the transactions pursuant to this Agreement and the other Loan Documents shall
be admissible in any action or proceeding arising therefrom, and shall
constitute rebuttably presumptive proof thereof, absent manifest error,
irrespective of whether any Obligation is also evidenced by a promissory note or
other instrument. The Agent will provide to the Borrowers a monthly statement of
Revolving Loans, payments, and other transactions pursuant to this Agreement.
Such statement shall be deemed correct, accurate, and binding

 

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on the Borrowers and an account stated (except for reversals and reapplications
of payments made as provided in Section 3.7 and corrections of errors discovered
by the Agent), unless the Borrowers notify the Agent in writing to the contrary
within thirty (30) days after such statement is received. In the event a timely
written notice of objections is given by the Borrowers, only the items to which
exception is expressly made will be considered to be disputed by the Borrowers.

ARTICLE 4.

TAXES, YIELD PROTECTION AND ILLEGALITY

4.1 Taxes.

(a) Any and all payments by any Loan Party on account of any Obligations shall
be made free and clear of and without reduction or withholding for any
Indemnified Taxes or Other Taxes, provided that if a Loan Party or the Agent
shall be required by the applicable law to deduct any Indemnified Taxes
(including any 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 Agent, any Lender or any Letter of Credit Issuer, as the case may be,
receives an amount equal to the sum it would have received had no such
deductions been made; (ii) the applicable Loan Party or the Agent shall make
such deductions; and (iii) the applicable Loan Party or the Agent shall timely
pay the full amount deducted to the relevant Governmental Authority in
accordance with Requirement of Law. Without limiting the foregoing, the
applicable Loan Party shall timely pay all Other Taxes to the relevant
Governmental Authorities.

(b) The Borrowers shall indemnify, hold harmless and reimburse the Agent, the
Lenders, and any Letter of Credit Issuer, within ten (10) days after demand
therefor, for the full amount of any Indemnified Taxes or Other Taxes (including
Indemnified Taxes or Other Taxes imposed or asserted on or attributable to
amounts payable under this Section) paid by the Agent, any Lender or any Letter
of Credit Issuer with respect to any Obligations, Letters of Credit or Loan
Documents, and any 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 setting forth in reasonable detail (without disclosing any business
or confidential information) the calculation of the amount of such payment or
liability delivered to Westlake by a Lender or any Letter of Credit Issuer (with
a copy to the Agent), or by the Agent, shall be conclusive absent manifest
error. As soon as practicable after any payment of Indemnified Taxes or Other
Taxes by a Borrower, Westlake shall deliver to the Agent a receipt issued by the
Governmental Authority evidencing such payment or other evidence of payment
satisfactory to Agent. Notwithstanding anything to the contrary in this
Agreement, the Loan Parties shall not indemnify any Person for Excluded Taxes.

(c) Any Foreign Lender that is entitled to an exemption from or reduction of
withholding tax under the law of the jurisdiction in which a Loan Party is
resident for tax purposes, or any treaty to which such jurisdiction is a party,
with respect to payments under any Loan Document shall promptly deliver to the
Agent and Westlake, at the time or times prescribed by Requirement of Law or
reasonably requested by the Agent or Westlake, such properly completed and
executed documentation prescribed by Requirement of Law as will permit such
payments to be made without withholding or at a reduced rate of withholding. In
addition, any Lender, if requested by the Agent or Westlake, shall promptly
deliver such other documentation prescribed by Requirement of Law or reasonably
requested by the Agent or Westlake as will enable the Agent and Westlake to
determine whether or not such Lender is subject to backup withholding or
information reporting requirements.

 

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(d) Without limiting the generality of the foregoing, if a Borrower is resident
for tax purposes in the United States, (i) any Lender that is a “United States
person” within the meaning of Section 7701(a)(30) of the Code shall deliver to
the Agent and Westlake, on or prior to the date on which such Lender becomes a
Lender hereunder, duly completed copies of a then effective IRS Form W-9 or such
other documentation or information prescribed by Requirement of Law or
reasonably requested by the Agent or Westlake to determine whether or not such
Lender is subject to backup withholding or information reporting requirements;
(ii) a Foreign Lender shall deliver to the Agent and Westlake on or prior to the
date on which such Foreign Lender becomes a Lender hereunder, whichever of the
following is applicable: (A) duly completed copies of a then effective IRS Form
W-8BEN claiming eligibility for benefits of an income tax treaty to which the
United States is a party; (B) duly completed copies of a then effective IRS Form
W-8ECI; (C) duly completed copies of a then effective IRS Form W-8IMY and all
required supporting documents; (D) in the case of a Foreign Lender claiming the
benefits of the exemption for portfolio interest under section 881(c) of the
Code, (1) a certificate to the effect that such Foreign Lender is not (x) a
“bank” within the meaning of section 881(c)(3)(A) of the Code, (y) a “10 percent
shareholder” of any Obligor within the meaning of section 881(c)(3)(B) of the
Code, or (z) a “controlled foreign corporation” described in
section 881(c)(3)(C) of the Code, and (2) duly completed copies of a then
effective IRS Form W-8BEN; or (E) any other form prescribed by Requirement of
Law as a basis for claiming exemption from or a reduction in United States
federal withholding tax, duly completed together with such supplementary
documentation as may be prescribed by Requirement of Law to permit Borrowers to
determine the withholding or deduction required to be made; and (iii) if a
payment made to a Lender under any Loan Document would be subject to U.S.
federal withholding Tax imposed by FATCA if such Lender were to fail to comply
with the applicable reporting requirements of FATCA (including those contained
in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall
deliver to Westlake and the Agent at the time or times prescribed by law and at
such time or times reasonably requested by Westlake or the Agent such
documentation prescribed by applicable Requirement of Law (including as
prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional
documentation reasonably requested by Westlake or the Agent as may be necessary
for Westlake and the Agent to comply with their obligations under FATCA and to
determine that such Lender has complied with such Lender’s obligations under
FATCA or to determine the amount to deduct and withhold from such payment.
Solely for purposes of this clause (d)(iii), “FATCA” shall include any
amendments made to FATCA after the date of this Agreement.

(e) Each Lender and each Letter of Credit Issuer shall promptly notify Westlake
and the Agent of any change in circumstances that would change any claimed
exemption or reduction or otherwise render the documentation provided under
Section 4.1(d) obsolete or inaccurate in any material respect and shall,
promptly upon reasonable request by the Agent or Westlake, provide updated
documentation under Section 4.1(d). Each Lender and each Letter of Credit Issuer
shall indemnify, hold harmless and reimburse (within ten (10) days after demand
therefor) the Loan Parties and the Agent for any Taxes, losses, claims,
liabilities, penalties, interest and expenses (including reasonable attorneys’
fees) incurred by or asserted against a Loan Party or the Agent by any
Governmental Authority due to such Lender’s or such Letter of Credit Issuer’s
failure to deliver, or inaccuracy or deficiency in, any documentation required
to be delivered by it pursuant to this Section. Each Lender and each Letter of
Credit Issuer authorizes the Agent to set off any amounts due to the Agent under
this Section against any amounts payable to such Lender or such Letter of Credit
Issuer under any Loan Document. This Section shall survive Full Payment of the
Obligations, or any resignation or replacement of the Agent, any Lender, or any
Letter of Credit Issuer.

 

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(f) If the Agent, any Lender, or any Letter of Credit Issuer determines, in its
sole discretion, that it has received a refund of any Taxes or Other Taxes as to
which it has been indemnified by a Loan Party, or with respect to which a Loan
Party has paid additional amounts pursuant to this Section, it shall pay to such
Loan Party an amount equal to such refund (but only to the extent of indemnity
payments made, or additional amounts paid, by such Loan Party under this Section
with respect to the Taxes or Other Taxes giving rise to such refund), net of all
out-of-pocket expenses of the Agent, such Lender, or such Letter of Credit
Issuer, as the case may be, and without interest (other than any interest paid
by the relevant Governmental Authority with respect to such refund), provided
that such Loan Party, upon the request of the Agent, such Lender, or such Letter
of Credit Issuer, agrees to repay the amount paid over to such Loan Party (plus
any penalties, interest or other charges imposed by the relevant Governmental
Authority) to the Agent, such Lender, or such Letter of Credit Issuer if the
Agent, such Lender, or such Letter of Credit Issuer is required to repay such
refund to such Governmental Authority. This subsection shall not be construed to
require the Agent, any Lender, or any Letter of Credit Issuer to make available
its tax returns (or any other information relating to its taxes that it deems
confidential) to any Loan Party or any other Person.

4.2 Illegality.

(a) If any Lender determines that the introduction of any Requirement of Law, or
any change in any Requirement of Law, or in the interpretation or administration
of any Requirement of Law, has made it unlawful, or that any central bank or
other Governmental Authority has asserted that it is unlawful, for any Lender or
its applicable lending office to make LIBOR Rate Loans, then, on notice thereof
by that Lender to the Borrowers through the Agent together with an explanation
of the circumstances, any obligation of that Lender to make LIBOR Rate Loans
shall be suspended until that Lender notifies the Agent and the Borrowers that
the circumstances giving rise to such determination no longer exist.

(b) If a Lender determines that it is unlawful to maintain any LIBOR Rate Loan,
the Borrowers shall, upon its receipt of notice of such fact and demand from
such Lender (with a copy to the Agent), prepay in full such LIBOR Rate Loans of
that Lender then outstanding, together with interest accrued thereon and amounts
required under Section 4.4, either on the last day of the Interest Period
thereof, if that Lender may lawfully continue to maintain such LIBOR Rate Loans
to such day, or immediately, if that Lender may not lawfully continue to
maintain such LIBOR Rate Loans and if applicable convert to Base Rate Loans. If
the Borrowers are required to so prepay any LIBOR Rate Loans, then concurrently
with such prepayment, the Borrowers shall borrow from the affected Lender, in
the amount of such prepayment, a Base Rate Loan.

4.3 Increased Costs; Capital Adequacy.

(a) Change in Law. If any Change in Law shall:

(i) impose, modify or deem applicable any reserve, special deposit, compulsory
loan, insurance charge or similar requirement against assets of, deposits with
or for the account of, or credit extended or participated in by, any Lender
(except any reserve requirement reflected in LIBOR Rate) or any Letter of Credit
Issuer;

(ii) subject any Lender or any Letter of Credit Issuer to any Tax with respect
to any Revolving Loan, Loan Document, Letter of Credit, Credit Support or
participation in Letters of Credit or Credit Support, or change the basis of
taxation of payments to such

 

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Lender or such Letter of Credit Issuer in respect thereof (except for
Indemnified Taxes or Other Taxes covered by Section 4.1 and the imposition of,
or any change in the rate of, any Excluded Tax payable by, or imposed with
respect to payments to, such Lender or such Letter of Credit Issuer); or

(iii) impose on any Lender or any Letter of Credit Issuer or the London
interbank market any other condition, cost, or expense affecting any Revolving
Loan, Loan Document, Letter of Credit, Credit Support, participation in Letters
of Credit or Credit Support, or Commitment;

and the result thereof shall be to increase the cost to such Lender of making or
maintaining any LIBOR Rate Loan or Commitment, or to increase the cost to such
Lender or such Letter of Credit Issuer of participating in, issuing or
maintaining any Letter of Credit or Credit Support, or to reduce the amount of
any sum received or receivable by such Lender or such Letter of Credit Issuer
hereunder (whether of principal, interest or any other amount) then, upon
request of such Lender or such Letter of Credit Issuer, the Borrowers will,
within ten (10) days of receipt of the certificate delivered by the Agent under
Section 4.6, pay to such Lender or such Letter of Credit Issuer, as applicable,
such additional amount or amounts as will compensate such Lender or such Letter
of Credit Issuer, as applicable, for such additional costs incurred or reduction
suffered.

(b) Capital Adequacy. If any Lender or any Letter of Credit Issuer determines
that any Change in Law affecting such Lender or such Letter of Credit Issuer or
any Lending Office of such Lender or such Lender’s or such Letter of Credit
Issuer’s holding company, if any, regarding capital requirements has or would
have the effect of reducing the rate of return on such Lender’s, such Letter of
Credit Issuer’s or holding company’s capital as a consequence of this Agreement,
or such Lender’s or such Letter of Credit Issuer’s Commitments, Revolving Loans,
Letters of Credit, Credit Support, or participations in Letters of Credit or
Credit Support, to a level below that which such Lender, such Letter of Credit
Issuer or holding company could have achieved but for such Change in Law (taking
into consideration such Lender’s, such Letter of Credit Issuer’s and holding
company’s policies with respect to capital adequacy), then from time to time the
Borrowers will pay to such Lender or such Letter of Credit Issuer, as the case
may be, such additional amount or amounts as will compensate it or its holding
company for any such reduction suffered, in each case, within ten (10) days of
receipt of the certificate delivered under Section 4.6.

4.4 Funding Losses. If for any reason (other than default by a Lender) (a) any
Borrowing of, or conversion to or continuation of, a LIBOR Rate Loan does not
occur on the date specified therefor in a Notice of Borrowing or Notice of
Conversion/Continuation (whether or not withdrawn), (b) any repayment or
conversion of a LIBOR Rate Loan occurs on a day other than the end of its
Interest Period, (c) the Borrowers fail to repay a LIBOR Rate Loan when required
hereunder, or (d) a Lender (other than a Defaulting Lender) is required to
assign a LIBOR Rate Loan prior to the end of its Interest Period pursuant to
Section 4.9, then the Borrowers shall, within ten (10) days of receipt of the
certificate delivered under Section 4.6, pay to the Agent its customary
administrative charge and to each Lender all losses and expenses that it
sustains as a consequence thereof, including any loss or expense arising from
liquidation or redeployment of funds or from fees payable to terminate deposits
of matching funds. Lenders shall not be required to purchase Dollar deposits in
the London interbank market or any other offshore Dollar market to fund any
LIBOR Rate Loan, but the provisions hereof shall be deemed to apply as if each
Lender had purchased such deposits to fund its LIBOR Rate Loans.

4.5 Inability to Determine Rates. If Required Lenders notify the Agent for any
reason in connection with a request for a Borrowing of, or conversion to or
continuation of, a LIBOR Rate Loan

 

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that (a) Dollar deposits are not being offered to banks in the London interbank
Eurodollar market for the applicable amount and Interest Period of such Loan,
(b) adequate and reasonable means do not exist for determining LIBOR Rate for
the requested Interest Period, or (c) LIBOR Rate for the requested Interest
Period does not adequately and fairly reflect the cost to such Lenders of
funding such Revolving Loan, then the Agent will promptly so notify Westlake and
each Lender. Thereafter, the obligation of Lenders to make or maintain LIBOR
Rate Loans shall be suspended until the Agent (upon instruction by Required
Lenders) revokes such notice. Upon receipt of such notice, Westlake may revoke
any pending request for a Borrowing of, conversion to or continuation of a LIBOR
Rate Loan or, failing that, will be deemed to have submitted a request for a
Base Rate Loan.

4.6 Certificates of the Agent. If any Lender or any Letter of Credit Issuer
claims reimbursement or compensation under this Article 4, the Agent shall
determine the amount thereof and shall deliver to the Borrowers (with a copy to
the affected Lender) a certificate setting forth in reasonable detail the amount
payable to the affected Lender, and such certificate shall be conclusive and
binding on the Borrowers in the absence of manifest error.

4.7 Delay in Requests. Failure or delay on the part of any Lender or any Letter
of Credit Issuer to demand compensation pursuant to this Section shall not
constitute a waiver of its right to demand such compensation, but the Borrowers
shall not be required to compensate a Lender or a Letter of Credit Issuer for
any increased costs incurred or reductions suffered more than nine (9) months
prior to the date that a Lender or a Letter of Credit Issuer notifies Westlake
of the Change in Law giving rise to such increased costs or reductions and of
such Lender’s or such Letter of Credit Issuer’s intention to claim compensation
therefor (except that, if the Change in Law giving rise to such increased costs
or reductions is retroactive, then the nine-month period referred to above shall
be extended to include the period of retroactive effect thereof).

4.8 Mitigation. If any Lender or any Letter of Credit Issuer gives a notice
under Section 4.2 or requests compensation under Section 4.3, or if the Loan
Parties are required to pay additional amounts with respect to a Lender under
Section 4.1, then such Lender shall use reasonable efforts to designate a
different Lending Office or to assign its rights and obligations hereunder to
another of its offices, branches or Affiliates, if, in the judgment of such
Lender, such designation or assignment (a) would eliminate the need for such
notice or reduce amounts payable in the future, as applicable; and (b) in each
case, would not subject such Lender to any unreimbursed cost or expense and
would not otherwise be disadvantageous to such Lender. The Borrowers agree to
pay all reasonable costs and expenses incurred by any Lender in connection with
any such designation or assignment.

4.9 Replacement of Lenders. If any Lender requests compensation under
Section 4.3, or if the Borrowers are required to pay any additional amount to
any Lender or any Governmental Authority for the account of any Lender pursuant
to Section 4.1, or if any Lender gives notice under Section 4.2, at the
Borrowers’ request, the Agent or an Eligible Assignee shall have the right (but
not the obligation) with the Agent’s approval, to purchase from such Lender, and
such Lender agrees that it shall sell, all its Commitments for an amount equal
to the principal balances thereof and all accrued interest and fees with respect
thereto through the date of sale pursuant to Assignment and Acceptance, without
premium or discount. The Agent is irrevocably appointed as attorney-in-fact to
execute any such Assignment and Acceptance if such Lender fails to execute same
within twenty (20) days of such request of assignment. Such Lender shall be
entitled to receive, in cash, concurrently with such assignment, all amounts
owed to it under the Loan Documents, including all principal, interest and fees
through the date of assignment (but excluding any prepayment charge).

4.10 Survival. The agreements and obligations of the Borrowers in this Article 4
shall survive the payment of all other Obligations.

 

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ARTICLE 5.

BOOKS AND RECORDS; FINANCIAL INFORMATION; NOTICES

5.1 Books and Records. The Loan Parties shall maintain, at all times, correct
and complete books, records and accounts in which entries that are complete,
correct and timely in all material respects are made of their respective
transactions in accordance with GAAP applied consistently with the audited
Financial Statements required to be delivered pursuant to Section 5.2(a) (it
being understood and agreed that certain Foreign Subsidiaries maintain
individual books and records in conformity with generally accepted accounting
principles in their respective countries of organization and that such
maintenance shall not constitute a breach of the representations, warranties, or
covenants hereunder). The Loan Parties shall, by means of appropriate entries,
reflect in such accounts and in all Financial Statements proper liabilities and
reserves for all taxes and proper provision for depreciation and amortization of
property and bad debts, all in accordance with GAAP. The Loan Parties shall
maintain at all times books and records pertaining to the Collateral in such
detail, form and scope as the Agent or any Lender shall reasonably require,
including, but not limited to, records of (a) all payments received and all
credits and extensions granted with respect to the Accounts; (b) the return,
rejection, repossession, stoppage in transit, loss, damage, or destruction of
any Inventory; and (c) all other dealings affecting the Collateral.

5.2 Financial Information. The Borrowers shall promptly furnish to the Agent,
all such financial information regarding the Loan Parties as the Agent shall
reasonably request. Without limiting the foregoing, the Borrowers will furnish
to the Agent, in such detail as the Agent or the Lenders shall request in their
reasonable discretion, the following:

(a) As soon as available, but in any event not later than ninety (90) days after
the close of each Fiscal Year, consolidated audited and consolidating unaudited
balance sheets, and income statements, cash flow statements and changes in
stockholders’ equity for Westlake and its Subsidiaries for such Fiscal Year, and
the accompanying notes thereto, setting forth in each case in comparative form
figures for the previous Fiscal Year, all in reasonable detail, fairly
presenting in all material respects the financial position and the results of
operations of Westlake and its Subsidiaries as at the date thereof and for the
Fiscal Year then ended, and prepared in accordance with GAAP. Such statements
shall be examined in accordance with generally accepted auditing standards by
and, in the case of such statements performed on a consolidated basis,
accompanied by a report of, independent certified public accountants of
recognized national standing selected by the Borrowers, which is not qualified
with respect to scope limitations imposed by any Loan Party, with respect to
accounting principles followed by any Loan Party not in accordance with GAAP, or
with respect to a “going concern” or similar nature. Westlake, simultaneously
with retaining such independent public accountants to conduct such annual audit,
shall send a letter to such accountants, with a copy to the Agent and the
Lenders, notifying such accountants that one of the primary purposes for
retaining such accountants’ services and having audited financial statements
prepared by them is for use by the Agent and the Lenders. The Borrowers hereby
authorize the Agent to communicate directly with their certified public
accountants and, by this provision, authorizes those accountants to disclose to
the Agent any and all financial statements and other supporting financial
documents and schedules relating to the Loan Parties and to discuss directly
with the Agent the finances and affairs of the Loan Parties. The Agent shall
give Westlake the opportunity to participate in any discussions with its
accountants.

(b) As soon as available, but in any event not later than (i) forty-five
(45) days after the last day of the first three fiscal quarters of each Fiscal
Year and (i) sixty (60) days after the last day of the fourth fiscal quarter of
each Fiscal Year, consolidated and consolidating unaudited balance sheets and
income statements, and consolidated cash flow statements and changes in
stockholders’ equity, for Westlake and its Subsidiaries for such fiscal quarter
and for the period

 

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from the beginning of the then-current fiscal year to, such last day. The
Borrowers shall certify by a certificate signed by a Responsible Officer of
Westlake that all such statements have been prepared in accordance with GAAP and
present fairly in all material respects the financial position of Westlake and
its Subsidiaries as at the dates thereof and its results of operations for the
periods then ended, subject to normal year-end adjustments and the absence of
applicable footnotes.

(c) As soon as available, but in any event not later than (i) thirty (30) days
after the end of each month other than March, June, September or December and
(ii) forty-five (45) days after the end of each March, June, September and
December, consolidated unaudited balance sheets of Westlake and its Subsidiaries
as at the end of such month, and consolidated unaudited income statements and
cash flow statements for Westlake and its Subsidiaries for such month and for
the period from the beginning of the Fiscal Year to the end of such month, all
in reasonable detail, fairly presenting in all material respects the financial
position and results of operations of Westlake and its Subsidiaries as at the
date thereof and for such periods, and prepared in accordance with GAAP (except
for the inclusion of necessary footnotes) applied consistently with the audited
Financial Statements required to be delivered pursuant to Section 5.2(a).
Notwithstanding the foregoing, the financial statements required to be delivered
pursuant to this clause (c) shall be required to be delivered for a particular
month only if the Availability is less than or equal to the greater of (i) 25%
of the Maximum Revolver Amount and (ii) $100,000,000 at any time during such
month.

(d) With each of the audited Financial Statements delivered pursuant to
Section 5.2(a), a certificate of the independent certified public accountants
that examined such statement to the effect that they have reviewed and are
familiar with this Agreement and that, in examining such Financial Statements,
they did not become aware of any fact or condition which then constituted a
Default or Event of Default with respect to Section 7.21, except for those, if
any, described in reasonable detail in such certificate.

(e) As soon as available, but in any event not later than (i) thirty (30) days
after the end of each month other than March, June, September or December and
(ii) forty-five (45) days after the end of each March, June, September and
December, a Compliance Certificate in the form of Exhibit G from a Responsible
Officer on behalf of the Loan Parties stating that, among other things, except
as explained in reasonable detail in such certificate, (A) all of the
representations and warranties of the Loan Parties contained in this Agreement
and the other Loan Documents are correct and complete in all material respects
as at the date of such certificate as if made at such time, except for those
that speak as of a particular date, (B) the Loan Parties are, at the date of
such certificate, in compliance in all material respects with all of its
respective covenants and agreements in this Agreement and the other Loan
Documents, and (C) no Default or Event of Default then exists or existed during
the period covered by the Financial Statements and at the end of such period,
together with a schedule setting forth in reasonable detail the calculation of
the Fixed Charge Coverage Ratio for the immediately preceding twelve (12) month
period. If such certificate discloses that a representation or warranty is not
correct or complete, or that a covenant has not been complied with, or that a
Default or Event of Default existed or exists, such certificate shall set forth
what action the Borrowers have taken or propose to take with respect thereto.

(f) Within thirty (30) days after the beginning of each Fiscal Year, annual
forecasts (to include forecasted consolidated, as well as consolidating by
business segment in accordance with Westlake’s customary practices, balance
sheets, income statements and cash flow statements) for Westlake and its
Subsidiaries as at the end of and for each fiscal month of such Fiscal Year.

 

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(g) Promptly upon the filing thereof, copies of all reports, if any, or other
documents filed by any Loan Party with the SEC under the Exchange Act, and all
reports, notices, or statements sent or received by any Loan Party to or from
the holders of any of the Bond Debt or other Debt of any Loan Party registered
under the Securities Act of 1933 or to or from the trustee under any indenture
under which the same is issued, other than non-material disclosures; provided
that the Loan Parties shall file with the SEC all Material Agreements in
accordance with applicable Requirements of Law.

(h) As soon as available, but in any event not later than fifteen (15) days
after any Borrower’s receipt thereof, a copy of any management letters prepared
for any Borrower by any independent certified public accountants of the
Borrowers in connection with the audited Financial Statements of the Loan
Parties for any Fiscal Year.

(i) If requested by the Agent, promptly after filing with the IRS, a copy of
each tax return filed by any Loan Party.

(j) A Borrowing Base Certificate prepared as of the end of each fiscal quarter,
to be delivered as soon as available, but in any event within fifteen (15) days
after the end of such fiscal quarter; provided that, if the Average Daily
Availability during any month in such fiscal quarter or in the prior fiscal
quarter exceeds the greater of: (x) 12.5% of the Maximum Revolver Amount and
(y) $50,000,000 but is less than or equal to the greater of (x) 75% of the
Maximum Revolver Amount and (y) $300,000,000, a Borrowing Base Certificate
prepared as of the end of such month and each subsequent month until all three
months in any subsequent fiscal quarter exceeds the greater of (x) 75% of the
Maximum Revolver Amount and (y) $300,000,000, such Borrowing Base Certificate to
be delivered as soon as available, but in any event within fifteen (15) days
after the end of each such month; provided further that, if the Average Daily
Availability during any month is less than or equal to the greater of (x) 12.5%
of the Maximum Revolver Amount and (y) $50,000,000, a Borrowing Base Certificate
prepared as of the end of each subsequent week and until the Average Daily
Availability during any subsequent month exceeds the greater of (x) 12.5% of the
Maximum Revolver Amount and (y) $50,000,00, such Borrowing Base Certificate to
be delivered as soon as available, but in any event within three (3) days after
the end of each such week. Notwithstanding the foregoing, the Borrowers may
deliver a Borrowing Base Certificate more frequently to determine Availability
or otherwise.

(k) (i) a detailed aged trial balance of all Accounts as of the end of each
fiscal quarter, specifying each Account’s Account Debtor name and address,
amount, invoice date and due date, showing any discount, allowance, credit,
authorized return or dispute, and including such proof of delivery, copies of
invoices and invoice registers, copies of related documents, repayment
histories, status reports and other information as the Agent may reasonably
request, and (ii) an inventory and reconciliation reports in form satisfactory
to the Agent, in each case to be delivered as soon as available after such
fiscal quarter end, but in any event within fifteen (15) days after the end of
such fiscal quarter; provided that, if the Average Daily Availability for any
month in such fiscal quarter or the prior fiscal quarter does not exceed the
greater of (x) 75% of the Maximum Revolver Amount and (y) $300,000,000, the
reports and other information required to be delivered pursuant to this
Section 5.2(k) shall be prepared as of the end of each month until the Average
Daily Availability for all three months in any subsequent fiscal quarter exceeds
the greater of (x) 75% of the Maximum Revolver Amount and (y) $300,000,000, such
reports and other information to be delivered not later than fifteen (15) days
after the end of each such month.

 

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(l) At the request of the Agent and the expense of the Borrowers, Inventory
appraisals to be performed by an appraisal company acceptable to the Agent;
provided that (i) no Inventory appraisal shall be required for any year in which
the Availability exceeds the greater of (x) 60% of the Maximum Revolver Amount
and (y) $240,000,000 at all times during such period, provided that Availability
may be less than or equal to the foregoing amount for no more than five
(5) consecutive Business Days if it is more than the greater of (x) 55% of the
Maximum Revolver Amount and (y) $220,000,000 at all times during such period;
(ii) two (2) Inventory appraisals shall be required for each year in which the
Availability is less than or equal to the greater of (x) 20% of the Maximum
Revolver Amount and (y) $80,000,000 for more than five (5) consecutive Business
Days during such period, or is less than the greater of (x) 15% of the Maximum
Revolver Amount and (y) $60 million at any time during such period; and
(iii) one (1) Inventory appraisal shall be required for any other year; provided
that the Agent may request Inventory appraisals to be performed at any time a
Default or an Event of Default exists. In addition to any Inventory appraisal
required pursuant to the foregoing, the Agent is entitled, at the expense of the
Borrowers, to cause an Inventory appraisal to be performed by an appraisal
company acceptable to the Agent within ninety (90) days of the Closing Date;
provided that in the event the Agent requests such appraisal to be performed,
the Aggregate Revolver Outstanding may not exceed $50,000,000 at any time until
the Agent has received the Inventory appraisal in form and substance acceptable
to the Agent.

(m) Such additional information (including, without limitation, copies of any
Material Agreement) as the Agent and/or any Lender may from time to time
reasonably request regarding the financial and business affairs of Westlake or
any of its Subsidiaries.

(n) Documents required to be delivered pursuant to Section 5.2(a), (b) or
(g) (to the extent any such documents are included in materials otherwise filed
with the SEC) may be delivered electronically and if so delivered, shall be
deemed to have been delivered on the date (i) on which the Borrowers post such
documents, or provide a link thereto on Westlake’s website on the Internet at
the website address www.westlake.com; or (ii) on which such documents are posted
on the Borrowers’ behalf on an Internet or intranet website, if any, to which
each Lender and the Agent have access (whether a commercial, third-party website
or whether sponsored by the Agent); provided that: (i) the Borrowers shall
deliver paper copies of such documents to the Agent or any Lender that requests
the Borrowers to deliver such paper copies until a written request to cease
delivering paper copies is given by the Agent or such Lender and (ii) the
Borrowers shall notify the Agent and each Lender (by telecopier or electronic
mail) of the posting of any such documents and provide to the Agent by
electronic mail electronic versions (i.e., soft copies) of such documents. The
Agent shall have no obligation to request the delivery or to maintain copies of
the documents referred to above, and in any event shall have no responsibility
to monitor compliance by the Borrowers with any such request for delivery, and
each Lender shall be solely responsible for requesting delivery to it or
maintaining its copies of such documents.

The Borrowers hereby acknowledge that the Agent and/or the Arranger will make
available to the Lenders and the Letter of Credit Issuers materials and/or
information provided by or on behalf of the Borrowers hereunder (collectively,
“Borrower Materials”) by posting the Borrower Materials on IntraLinks or another
similar electronic system. The Agent agrees to use its best efforts in
accordance with its standard business practices to post the Borrower Materials
to IntraLinks or another similar electronic system. The Agent shall have no
liability to the Lenders or the Borrowers for any failure to post the Borrower
Materials to IntraLinks or another similar electronic system.

 

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5.3 Notices to the Agent. The Borrowers shall notify the Agent in writing of the
following matters at the following times:

(a) Promptly after any Responsible Officer of any Loan Party becoming aware of
any Default or Event of Default;

(b) Promptly after any Responsible Officer of any Loan Party becoming aware of
the assertion by the holder of any capital stock of any Loan Party or the holder
of any Debt of any Loan Party in a face amount in excess of $20,000,000 that a
default exists with respect thereto or that such Loan Party is not in compliance
with the terms thereof, or the threat or commencement by such holder of any
enforcement action because of such asserted default or non-compliance;

(c) Promptly after any Responsible Officer of any Loan Party becoming aware of
any event or circumstance which could reasonably be expected to have a Material
Adverse Effect;

(d) Promptly after any Responsible Officer of any Loan Party becoming aware of
any pending or threatened action, suit, or proceeding, by any Person, or any
pending or threatened investigation by a Governmental Authority, which could
reasonably be expected to have a Material Adverse Effect;

(e) Promptly after any Responsible Officer of any Loan Party becoming aware of
any pending or threatened strike, work stoppage, unfair labor practice claim, or
other labor dispute affecting the any Loan Party in a manner which could
reasonably be expected to have a Material Adverse Effect;

(f) Promptly after any Responsible Officer of any Loan Party becoming aware of
any violation of any law, statute, regulation, or ordinance of a Governmental
Authority affecting any Loan Party which could reasonably be expected to have a
Material Adverse Effect;

(g) Promptly after receipt by a Responsible Officer of any Loan Party of (i) any
notice of any violation by any Loan Party of any Environmental Law or (ii) any
writing from any Governmental Authority asserting that (x) any Loan Party is not
in compliance with any Environmental Law or (y) any Loan Party is being
investigated for its compliance with the Environmental Law, provided that any
such violation, noncompliance or investigation could reasonably be expected to
have a Material Adverse Effect;

(h) Promptly after receipt by any Responsible Officer of any Loan Party of any
written notice that the any Loan Party is or may be liable to any Person as a
result of the Release or threatened Release of any Contaminant or that any Loan
Party is subject to investigation by any Governmental Authority evaluating
whether any remedial action is needed to respond to the Release or threatened
Release of any Contaminant which, in either case, is reasonably likely to give
rise to liability in excess of $20,000,000;

(i) Promptly after receipt by a Responsible Officer of any Loan Party of any
written notice of the imposition of any Environmental Lien against any property
of any Loan Party securing an amount which could reasonably be expected to
exceed $20,000,000;

(j) (i) Any change in any Loan Party’s name as it appears in the state of its
incorporation or other organization, state of incorporation or organization,
type of entity, organizational identification number, form of organization,
trade names under which any Loan Party will sell Inventory or create Accounts,
or to which instruments in payment of Accounts may

 

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be made payable, in each case at least thirty (30) days prior thereto (or such
shorter period as agreed to by the Agent in its sole discretion); and (ii) any
additional manufacturing facility, warehouse, storage facility, or customer or
vendor locations where Collateral is located (other than Collateral in transit),
which information shall be updated monthly or quarterly, as applicable, and
included in the monthly or quarterly reports, as applicable, prescribed in
Section 5.2(k);

(k) Within ten (10) Business Days after a Responsible Officer of any Loan Party
or any ERISA Affiliate knows or has reason to know, that an ERISA Event, or a
prohibited transaction (as defined in Sections 406 of ERISA and 4975 of the
Code), which could reasonably be expected to result in liability to any Loan
Party in excess of $15,000,000 has occurred, and, when known, any action taken
or threatened by the IRS, the DOL, or the PBGC with respect thereto;

(l) Promptly after request, or, in the event that such filing reflects a
potentially adverse significant financial change with respect to the matters
covered thereby, within ten (10) Business Days after the filing thereof with the
PBGC, the DOL, or the IRS, as applicable, copies of the following: (i) each
annual report (form 5500 series), including Schedule B thereto, filed with the
PBGC, the DOL, or the IRS with respect to each Plan, (ii) a copy of each funding
waiver request filed with the PBGC, the DOL, or the IRS with respect to any Plan
and all communications received by any Loan Party or any ERISA Affiliate from
the PBGC, the DOL, or the IRS with respect to such request, and (iii) a copy of
each other filing or notice filed with the PBGC, the DOL, or the IRS, with
respect to each Plan by either any Loan Party or any ERISA Affiliate;

(m) Promptly after request, copies of each actuarial report for any Plan or
Multi-employer Plan and annual report for any Multi-employer Plan; and within
ten (10) Business Days after receipt thereof by any Loan Party or any ERISA
Affiliate, copies of the following: (i) any notices of the PBGC’s intention to
terminate a Plan or to have a trustee appointed to administer such Plan;
(ii) any unfavorable determination letter from the IRS regarding the
qualification of a Plan under Section 401(a) of the Code; or (iii) any notice
from a Multi-employer Plan regarding the imposition of withdrawal liability to
any Loan Party in excess of $15,000,000;

(n) Within ten (10) Business Days after the occurrence of any failure by any
Loan Party or any ERISA Affiliate to make a required installment or any other
required payment under Section 412 of the Code on or before the due date for
such installment or payment;

(o) Within ten (10) Business Days after any Responsible Officer of any Loan
Party or any ERISA Affiliate knows or has reason to know that any of the
following events has or will occur which could reasonably be expected to result
in liability to any Loan Party in excess of $15,000,000: (i) a Multi-employer
Plan has been or will be terminated; (ii) the administrator or plan sponsor of a
Multi-employer Plan intends to terminate a Multi-employer Plan; or (iii) the
PBGC has instituted or will institute proceedings under Section 4042 of ERISA to
terminate a Multi-employer Plan;

(p) Promptly after the Borrowers have notified the Agent of any intention by the
Borrowers to treat the Revolving Loans and/or Letters of Credit and related
transactions as being a “reportable transaction” (within the meaning of Treasury
Regulation Section 1.6011-4), a duly completed copy of IRS Form 8886 or any
successor form; or

(q) Within ten (10) Business Days after any Responsible Officer of any Loan
Party knows or has reason to know that any Liens for taxes or statutory Liens
for taxes, assessments and other governmental charges, in an amount exceeding
$5,000,000, may be imposed or assessed against its property, notices of such
Liens and the details thereof.

 

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Each notice given under this Section 5.3 shall describe the subject matter
thereof in reasonable detail, and shall set forth the action that the Loan
Party, its Restricted Subsidiary, or any ERISA Affiliate, as applicable, has
taken or proposes to take with respect thereto.

ARTICLE 6.

GENERAL WARRANTIES AND REPRESENTATIONS

Each Borrower (and each other Loan Party by executing an Obligation Guaranty,
with respect to such Loan Party) warrants and represents to the Agent and the
Lenders that except as hereafter disclosed to and accepted by the Agent and the
Required Lenders in writing:

6.1 Authorization, Validity, and Enforceability of this Agreement and the Loan
Documents. Each Loan Party has the power and authority to execute, deliver, and
perform this Agreement and the other Loan Documents to which it is a party, to
incur the Obligations, and to grant to the Agent’s Liens upon and security
interests in the Collateral. Each Loan Party has taken all necessary action
(including obtaining approval of its stockholders if necessary) to authorize its
execution, delivery, and performance of this Agreement and the other Loan
Documents to which it is a party. This Agreement and the other Loan Documents to
which it is a party have been duly executed and delivered by each Loan Party,
and constitute the legal, valid, and binding obligations of each Loan Party,
enforceable against each such Loan Party in accordance with their respective
terms except as enforceability may be limited by the Federal Bankruptcy Code or
by any other state or federal bankruptcy or insolvency act or law and general
principles of equity. Each Loan Party’s execution, delivery, and performance of
this Agreement and the other Loan Documents to which it is a party do not and
will not conflict with, or constitute a violation or breach of, or result in the
imposition of any Lien (other than in favor of the Agent) upon the property of
such Loan Party or any of its Subsidiaries, by reason of the terms of (a) any
contract, mortgage, lease, material agreement, indenture, or instrument to which
such Loan Party is a party or which is binding upon it, (b) any Requirement of
Law applicable to such Loan Party or any of its Subsidiaries, or (c) the
certificate or articles of incorporation or by-laws or the limited liability
company or limited partnership agreement of such Loan Party or any of its
Restricted Subsidiaries. The Obligations under the Loan Documents are permitted
by the applicable supplemental indenture for each Bond Debt.

6.2 Validity and Priority of Security Interest. The provisions of this
Agreement, the Collateral Documents, and the other Loan Documents create legal
and valid Liens on all the Collateral in favor of the Agent, for the ratable
benefit of the Agent and the Lenders, and, upon the filing of all applicable
financing statements against the Loan Parties, such Liens shall constitute
perfected and continuing Liens on all the Collateral, having priority over all
other Liens on the Collateral, except for those Liens identified in clauses
(a) and (d) of the definition of Permitted Liens securing all the Obligations,
and enforceable against each Loan Party and all third parties.

6.3 Organization and Qualification. Each Loan Party (a) is duly organized or
incorporated and validly existing in good standing under the laws of the state
of its organization or incorporation, (b) is qualified to do business and is in
good standing in the jurisdictions in which qualification is necessary in order
for it to own or lease its property and conduct its business, except to the
extent that the failure to do so could not reasonably be expected to have a
Material Adverse Effect, and (c) has all requisite power and authority to
conduct its business and to own its property.

6.4 Corporate Name; Prior Transactions. Except as set forth on Schedule 6.4 or
as otherwise notified by Westlake to the Agent, no Loan Party has, during the
past five (5) years, been

 

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known by or used any other corporate or fictitious name, or been a party to any
merger or consolidation, or acquired all or substantially all of the assets of
any Person, or acquired any of its property outside of the ordinary course of
business.

6.5 Subsidiaries and Affiliates. Except as otherwise notified by Westlake to the
Agent, Schedule 6.5 is a correct and complete list of the name and relationship
to each Loan Party of each and all of its Subsidiaries and other Affiliates
owned, directly or indirectly, by Westlake. No Loan Party has any direct
ownership interest in any Subsidiary of any Unrestricted Subsidiary of Westlake.

6.6 Financial Statements and Projections.

(a) The Borrowers have delivered to the Agent and the Lenders the audited
balance sheet and related statements of income, retained earnings, cash flows,
and changes in stockholders equity for the Loan Parties as of December 31, 2010,
accompanied by the report thereon of the Borrowers’ independent certified public
accountants, PricewaterhouseCoopers LLP. The Borrowers have also delivered to
the Agent and the Lenders the unaudited balance sheet and related statements of
income and cash flows for the Loan Parties as of June 30, 2011. All such
Financial Statements have been prepared in accordance with GAAP and fairly
present in all material respects the financial position of the Loan Parties as
at the dates thereof and their results of operations for the periods then ended,
subject to normal year-end adjustments as to the June 30, 2011 statements, and
the absence of applicable footnotes.

(b) The Latest Projections when submitted to the Lenders as required herein
represent the Borrowers’ good faith estimate of the future financial performance
of the Loan Parties for the periods set forth therein. The Latest Projections
have been prepared on the basis of the assumptions set forth therein, which the
Borrowers believe are fair and reasonable in light of current and reasonably
foreseeable business conditions at the time submitted to the Lenders.

6.7 Solvency. On the Closing Date, at the time of each Borrowing hereunder, and
on the dates of the issuance of any Letters of Credit to be issued hereunder,
each Loan Party is (and after giving effect to the transactions contemplated by
the Loan Documents, and any incurrence of additional Debt will be) Solvent.

6.8 Real Estate; Leases. Except as terminated or expired in accordance with its
terms, (a) each of the leases and subleases of real or personal property held by
any Loan Party as lessee or sublessee (other than leases of personal property as
to which any Loan Party is lessee or sublessee for which the value of such
personal property in the aggregate is less than $5,000,000) is valid and
enforceable in accordance with its terms against the Loan Party thereof which is
a party thereto and is in full force and effect, and to the best of each Loan
Party’s knowledge, no default by any party to any such lease or sublease exists;
and (b) each of the leases and subleases of real or personal property held by
any Loan Party as lessor, or sublessor is valid and enforceable in accordance
with its terms against the Loan Party thereof which is a party thereto and is in
full force and effect, and to the best of each Loan Party’s knowledge, no
default by any party to any such lease or sublease exists, except in the case of
clauses (a) and (b), where such default or non-enforceability could not
reasonably be expected to (i) have a Material Adverse Effect or (ii) affect the
Agent’s access to any Collateral. Each Loan Party has good and indefeasible
title in fee simple to the Real Estate as owned by such Loan Party, or valid
leasehold interests in all Real Estate leased by such Loan Party and each Loan
Party has good and indefeasible title to all of its other property reflected on
the June 30, 2011 Financial Statements delivered to the Agent and the Lenders,
except as disposed of in compliance with Section 7.9 and except where failure to
have such title could not reasonably be expected to (i) have a Material Adverse
Effect or (ii) affect the Agent’s access to any Collateral, free of all Liens
except Permitted Liens.

 

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6.9 Proprietary Rights. Schedule 6.9 sets forth a correct and complete list of
all of the Proprietary Rights of each Loan Party as of the Closing Date. None of
the Proprietary Rights is subject to any licensing agreement or similar
arrangement except those which could not reasonably be expected to have a
Material Adverse Effect. To the best of each Loan Party’s knowledge, none of the
Proprietary Rights of such Loan Party infringes on or conflicts with any other
Person’s property, and no other Person’s property infringes on or conflicts with
the Proprietary Rights of such Loan Party, except for any such infringement or
conflict which could not reasonably be expected to (a) have a Material Adverse
Effect, (b) impair any Proprietary Rights constituting Collateral, or
(c) adversely affects the Agent’s enforcement of its rights in any Collateral.
The Proprietary Rights described on Schedule 6.9 constitute all of the property
of such type necessary to the current conduct of the business of each such Loan
Party as of the Closing Date. No Proprietary Rights are necessary for the Agent
to be able to enforce the Agent’s Liens granted in any Collateral Document in
any Inventory or Accounts.

6.10 Trade Names. All trade names or styles under which any Loan Party or any of
their Restricted Subsidiaries will sell Inventory or create Accounts, or to
which instruments in payment of Accounts may be made payable, as of the Closing
Date, are listed on Schedule 6.10.

6.11 Litigation. Except as set forth on Schedule 6.11, there is no pending, or
to the best of any Loan Party’s knowledge threatened, action, suit, proceeding,
or counterclaim by any Person against any Loan Party, or to the best of any Loan
Party’s knowledge, investigation by any Governmental Authority, or any basis for
any of the foregoing, which could reasonably be expected to have a Material
Adverse Effect.

6.12 Labor Disputes. Except as set forth on Schedule 6.12, as of the Closing
Date (a) there is no collective bargaining agreement or other labor contract
covering employees of any Loan Party or any of their Restricted Subsidiaries,
(b) no such collective bargaining agreement or other labor contract is scheduled
to expire during the term of this Agreement, (c) to the best of each Loan
Party’s knowledge, no union or other labor organization is seeking to organize,
or to be recognized as, a collective bargaining unit of employees of any Loan
Party or any of their Restricted Subsidiaries or for any similar purpose, and
(d) there is no pending or (to the best of any Loan Party’s knowledge)
threatened, strike, work stoppage, material unfair labor practice claim, or
other material labor dispute against or affecting any Loan Party or their
Restricted Subsidiaries or their employees.

6.13 Environmental Laws. Except as otherwise disclosed on Schedule 6.13 or
except as could not reasonably be expected to have a Material Adverse Effect:

(a) The Loan Parties and their Subsidiaries are and have been in compliance with
all Environmental Laws.

(b) Each of the Loan Parties and their Subsidiaries have obtained, and have
timely filed any renewal applications for, all permits necessary for its current
operations under Environmental Laws, and each Loan Party and its Subsidiaries
are in compliance with all terms and conditions of such permits, or, when
applicable, such applications.

(c) There has been no Release, nor to the best of any Loan Party’s knowledge,
any threatened Release, that has resulted in or that could result in: (i) a
violation of or obligation under any Environmental Law, including without
limitation, notification, deed recordation, or remediation, or (ii) a diminution
in value of the Real Estate. The Real Estate has not contained and currently
does not contain any underground storage tanks, any polychlorinated biphenyls
(PCBs), or any asbestos.

 

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(d) The Loan Parties and their Subsidiaries have not given, nor were they
required to give, and have not received, any notice that: (i) the Loan Parties
and their Subsidiaries have violated, or are about to violate, any Environmental
Law; (ii) there has been a Release, or there is a threat of Release, from the
Real Estate; (iii) the Loan Parties and their Subsidiaries may be or are liable,
in whole or in part, for the costs of cleaning up, remediating, removing or
responding to a Release; or (iv) the Real Estate is subject to a lien in favor
of any governmental entity for any liability, costs or damages, under any
Environmental Laws arising from, or costs incurred by, such governmental entity
in response to a Release. No conditions have existed, currently exist, or are
reasonably foreseeable, that would give rise to such a notice.

(e) Neither Loan Parties nor any Subsidiary nor any Real Estate or presently
conducted operations, nor any previously owned real property or prior
operations, is subject to any enforcement order from or liability agreement with
any Governmental Authority or private Person respecting (i) compliance with any
Environmental Law or (ii) any potential liabilities and costs or remedial action
arising from the Release or threatened Release.

(f) To the best of any Loan Party’s knowledge, none of the present or past
operations of the Loan Parties or their Subsidiaries is the subject of any
investigation by any Governmental Authority evaluating whether any compliance
action is warranted or any remedial action is needed to respond to a Release or
threatened Release.

(g) Neither the Loan Parties nor any of their Subsidiaries has entered into any
negotiations or settlement agreements with any Person (including the prior owner
of its property) imposing material obligations or liabilities on any Loan Party
or any of its Subsidiaries with respect to any remedial action in response to
the Release of a Contaminant or environmentally related claim.

(h) Neither the Loan Parties nor any of their Subsidiaries have ever disposed
of, sent or arranged for the transportation of Hazardous Materials on or from
Real Estate or formerly owned real property which, pursuant to CERCLA or any
similar or analogous state law, has been placed or is proposed to be paced (by
the United States Environmental Protection Agency (“EPA”) or similar state
authority) on the “National Priorities List” or similar state list.

(i) Neither the Loan Parties nor any of their Subsidiaries have been identified
by EPA, any similar state authority, or any third party, as a potentially
responsible party under CERCLA, or any similar or analogous state law, with
respect to the Real Estate or any other site currently or formerly owned,
operated or used by Loan Parties or their Subsidiaries.

(j) None of the products manufactured, distributed or sold by the Loan Parties
or any of their Subsidiaries contain asbestos containing material.

(k) No Environmental Lien has attached to the Real Estate.

6.14 No Violation of Law. Neither any Loan Party nor any of their Subsidiaries
is in violation of any Requirement of Law applicable to it which violation could
reasonably be expected to have a Material Adverse Effect.

6.15 No Default. Neither any Loan Party nor any of their Restricted Subsidiaries
is in default with respect to any note, indenture, loan agreement, mortgage,
lease, deed, or other agreement to which such Person is a party or by which it
is bound, which default could reasonably be expected to have a Material Adverse
Effect.

 

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6.16 ERISA Compliance. Except as specifically disclosed in Schedule 6.16:

(a) Each Plan is in compliance in all material respects with the applicable
provisions of ERISA, the Code, and other federal or state law. Each Plan which
is intended to qualify under Section 401(a) of the Code has received a favorable
determination letter from the IRS or an application for such a letter is
currently pending with the IRS with respect thereto or the applicable remedial
amendment period has not elapsed and, to the best knowledge of any Loan Party,
nothing has occurred which would prevent or cause the loss of such
qualification. Each Borrower and each ERISA Affiliate has made all required
contributions to any Plan subject to Section 412 of the Code, and no application
for a funding waiver or an extension of any amortization period pursuant to
Section 412 of the Code has been made with respect to any Plan.

(b) There are no pending or, to the best knowledge of any Borrower, threatened
claims (other than ordinary claims for benefits by participants and
beneficiaries), actions or lawsuits, or action by any Governmental Authority,
with respect to any Plan which has resulted or could reasonably be expected to
result in a Material Adverse Effect. There has been no prohibited transaction or
violation of the fiduciary responsibility rules with respect to any Plan which
has resulted or could reasonably be expected to result in a Material Adverse
Effect.

(c) (i) No ERISA Event has occurred within the past five (5) years or is
reasonably expected to occur which has or could reasonably be expected to result
in liability to any Loan Party in excess of $15,000,000; (ii) the Unfunded
Pension Liability, in the aggregate, for all Pension Plans does not exceed
$25,000,000; (iii) neither any Borrower nor any ERISA Affiliate has incurred, or
reasonably expects to incur, any liability under Title IV of ERISA to the PBGC
with respect to any Pension Plan (other than premiums due and not delinquent
under Section 4007 of ERISA); and (iv) neither any Borrower nor any ERISA
Affiliate has engaged in a transaction that could be subject to Section 4069 or
4212(c) of ERISA.

6.17 Taxes. The Loan Parties and their Restricted Subsidiaries have filed all
federal and, except to the extent that a failure to do so could not reasonably
be expected to have a Material Adverse Effect, other tax returns and tax reports
required to be filed (or appropriate extensions have been timely filed), and
have paid all federal and other taxes, assessments, fees and other governmental
charges levied or imposed upon them or their properties, income or assets
otherwise due and payable, except where such nonpayment would not constitute a
breach of Section 7.1(b).

6.18 Regulated Entities. None of any Loan Party, any Person controlling any Loan
Party, or any Subsidiary of any Loan Party, is an “Investment Company” within
the meaning of the Investment Company Act of 1940. No Loan Party is a regulated
entity under the Federal Power Act, the Interstate Commerce Act, any state
public utilities code or law, or any other federal or state statute or
regulation limiting its ability to incur Debt.

6.19 Use of Proceeds; Margin Regulations. The proceeds of any Borrowing are to
be used solely (a) to pay the costs and expenses related to this Agreement,
(b) for working capital purposes of the Loan Parties, and (c) for general
corporate purposes, including acquisitions permitted under this Agreement. None
of such proceeds will be used for the purpose of purchasing or carrying any
“margin stock” as defined in Regulations T, U, or X of the Board of Governors of
the Federal Reserve System or for any other purpose which might constitute this
transaction a “purpose credit” within the meaning of such regulations. No part
of the proceeds of any Borrowing will be used for any purpose which violates, or
is inconsistent with, the provisions of Regulation X. No Loan Party nor any
Subsidiary of such Loan Party is engaged in the business of purchasing or
selling Margin Stock or extending credit for the purpose of purchasing or
carrying Margin Stock. Following the application of the proceeds of each
Borrowing,

 

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not more than 25% of the value of the assets (either of any individual Borrower
or of the Loan Parties on a consolidated basis) subject to the provisions of
Section 7.9 or Section 7.18 or subject to any restriction contained in any
agreement or instrument between any Borrower and any Lender or any Affiliate of
any Lender relating to Debt and within the scope of Section 9.1(d) will be
Margin Stock.

6.20 Copyrights, Patents, Trademarks and Licenses, etc. Each Loan Party owns or
is licensed or otherwise has the right to use all of the Proprietary Rights,
contractual franchises, licenses, permits, rights of way, authorizations, and
other rights that are reasonably necessary for the operation of its businesses,
without conflict with the rights of any other Person. To the best knowledge of
any Borrower, no slogan or other advertising device, product, process, method,
substance, part, or other material now employed, or now contemplated to be
employed, by any Loan Party or any Subsidiary of any Loan Party infringes upon
any rights held by any other Person, which in either case, could reasonably be
expected to (a) have a Material Adverse Effect, (b) impair any Collateral, or
(c) adversely affects the Agent’s enforcement of its rights in any Collateral.
No claim or litigation regarding any of the foregoing is pending, or, to the
best knowledge of any Loan Party, threatened, and no patent, invention, device,
application, principle or any statute, law, rule, regulation, standard or code
is pending or, to the knowledge of any Borrower, proposed, which, in either
case, could reasonably be expected to have a Material Adverse Effect.

6.21 No Material Adverse Change. No Material Adverse Effect has occurred since
the latest date of the Financial Statements delivered to the Lenders.

6.22 Full Disclosure. None of the representations or warranties (other than as
to estimates, projections, and pro forma Financial Statements) made by any Loan
Party in the Loan Documents as of the date such representations and warranties
are made or deemed made, and none of the statements contained in any exhibit,
report, statement or certificate furnished by or on behalf of any Loan Party in
connection with the Loan Documents (including the offering and disclosure
materials delivered by or on behalf of the Loan Parties to the Lenders prior to
the Closing Date), contains any untrue statement of a material fact or omits any
material fact required to be stated therein or necessary to make the statements
made therein, in light of the circumstances under which they are made, not
misleading as of the time when made or delivered. Any estimates, projections,
and pro forma Financial Statements delivered to the Agent or the Lenders were
prepared in good faith based on assumptions believed to be reasonable at the
time.

6.23 Locations of Collateral. Schedule 6.23, as updated in writing by the Loan
Parties to the Agent from time to time, contains, as of the last date updated
pursuant to Section 5.3(j), a correct and complete list of all manufacturing
facilities, warehouses, storage facilities, or customer or vendor locations
where Collateral is located (other than Collateral in transit).

6.24 Deposit Accounts. Schedule 6.24 contains as of the Closing Date a complete
and accurate list of all Deposit Accounts maintained by the Loan Parties with
any bank or other financial institution.

6.25 Governmental Authorization. No approval, consent, exemption, authorization,
or other action by, or notice to, or filing with, any Governmental Authority or
other Person is necessary or required in connection with (a) the execution or
delivery by, or enforcement against, any Loan Party of this Agreement or any
other Loan Document or (b) the borrowing and repayment of the Loans or the
granting and maintenance of Liens in the Collateral, other than (i) those
already obtained, (ii) the filing of UCC financing statements, and (iii) the
filing of the Copyright Security Agreements and the Patent and Trademark
Agreements.

 

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6.26 No Restrictions. There exists no document, contract, or agreement to which
any Loan Party or any direct or indirect parent of any Loan Party is a party
that could reasonably be expected to materially and adversely affect this
Agreement, any other Loan Document, or the transactions contemplated hereby or
thereby or that otherwise restricts or prohibits the transactions contemplated
hereby or thereby.

ARTICLE 7.

AFFIRMATIVE AND NEGATIVE COVENANTS

Each Borrower (and each other Loan Party by execution of an Obligation Guaranty,
with respect to covenants applicable to such Loan Party) covenants to the Agent
and each Lender that so long as any of the Obligations remain outstanding or
this Agreement is in effect:

7.1 Taxes and Other Obligations. Except to the extent that a failure to do so
could not reasonably be expected to have a Material Adverse Effect, each Loan
Party shall, and shall cause each of its Subsidiaries to, (a) file prior to
delinquency all tax returns and other tax reports which it is required to file;
and (b) pay, or provide for the payment, when due, of all taxes, fees,
assessments and other governmental charges against it or upon its property,
income and franchises, make all required withholding and other tax deposits, and
establish adequate reserves or other provision required by GAAP for the payment
of all such items, and provide to the Agent and the Lenders, upon request,
satisfactory evidence of its timely compliance with the foregoing.
Notwithstanding the foregoing, the failure of a Loan Party or any of its
Subsidiaries to comply with the foregoing shall not constitute a breach of this
Section 7.1 if (i) such amounts are not yet due and payable; or (ii) (A) such
Loan Party is contesting such taxes, fees, assessments, or governmental charges
in good faith by appropriate proceedings diligently pursued, (B) such Loan Party
has established proper reserves as required under GAAP, and (C) the nonpayment
of such amounts does not result in the imposition of a Lien (other than a
Permitted Lien).

7.2 Legal Existence and Good Standing. Except as permitted by Section 7.9, each
Loan Party shall maintain its legal existence and its qualification and good
standing in all jurisdictions in which the failure to maintain such existence
and qualification or good standing could reasonably be expected to have a
Material Adverse Effect. The foregoing shall not restrict any merger,
consolidation, wind-up, liquidation or dissolution permitted by Section 7.9.

7.3 Compliance with Law and Agreements; Maintenance of Licenses; Amendments to
Charter Documents. Each Loan Party shall comply, and shall cause each of its
Subsidiaries to comply, in all material respects, with all Requirements of Law
of any Governmental Authority having jurisdiction over it or its business
(including the Federal Fair Labor Standards Act and all Environmental Laws),
except to the extent that the failure to do so could not reasonably be expected
to have a Material Adverse Effect. No Loan Party shall violate the provisions of
any Material Agreement, except to the extent that the failure to do so could not
reasonably be expected to have a Material Adverse Effect. Each Loan Party shall,
and shall cause each of its Subsidiaries to, obtain and maintain all licenses,
permits, franchises, and governmental authorizations necessary to own its
property and to conduct its business as conducted on the Closing Date, except to
the extent that the failure to do so could not reasonably be expected to have a
Material Adverse Effect. No Loan Party shall modify, amend, or alter its
certificate or articles of incorporation, or its limited liability company
operating agreement or limited partnership agreement, as applicable, other than
in a manner which does not adversely affect the rights of the Lenders or the
Agent.

 

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7.4 Maintenance of Property; Inspection of Property.

(a) Each Loan Party shall, and shall cause each of its Restricted Subsidiaries
to, maintain all of its Collateral and other material property necessary and
useful in the conduct of its business, in good operating condition and repair,
ordinary wear and tear excepted.

(b) Each Loan Party shall permit representatives and independent contractors of
the Agent (at the expense of the Borrowers not to exceed (i) once per year or
(ii) twice per year if the Availability is less than or equal to (A) the greater
of (x) 40% of the Maximum Revolver Amount and (y) $160,000,000 for five
(5) consecutive Business Days during such one year period or (B) the greater of
(x) 35% of the Maximum Revolver Amount and (y) $140,000,000 at any time during
such one year period, in each case unless a Default or an Event of Default has
occurred and is continuing) to visit and inspect any of its properties, to
examine its corporate, financial and operating records, and make copies thereof
or abstracts therefrom and to discuss its affairs, finances and accounts with
its directors, officers and independent public accountants, at such reasonable
times during normal business hours and as soon as may be reasonably desired,
upon reasonable advance notice to such Loan Parties; provided, however, when a
Default or an Event of Default exists, the Agent or any Lender may do any of the
foregoing at the expense of the Borrowers at any time during normal business
hours without advance notice. The Agent and the Lenders shall give the Borrowers
the opportunity to participate in any discussions with the Borrowers’
independent public accountants. Notwithstanding anything to the contrary in this
Section 7.4, at all times during such visits and inspections, the Agent or any
Lender (or their respective representatives or contractors) must comply with all
applicable reasonable site regulations as the Loan Party or its Restricted
Subsidiaries or any of their respective officers or employees may require by
reasonable notice of the same.

(c) Each Loan Party shall own or have valid licenses for all Proprietary Rights
necessary for the anticipated future conduct of the business of each such Loan
Party.

7.5 Insurance.

(a) Each Loan Party shall maintain, and shall cause each of its Restricted
Subsidiaries to maintain, insurance with insurers (with a Best Rating of at
least A7, unless otherwise approved by the Agent) satisfactory to Agent, (it
being understood that the companies acceptable to the Agent on the Closing Date
shall be acceptable thereafter absent a change in rating or other
circumstances), (i) with respect to the properties and business of the Borrowers
and the Restricted Subsidiaries of such type (including product liability,
workers’ compensation, or commercial crime insurance), in such amounts, and with
such coverages and deductibles as are customary for companies similarly situated
(it being understood that policies acceptable in form and substance to the Agent
in connection with the initial closing shall be generally acceptable thereafter
absent a change in law, facts, or circumstances) and (ii) business interruption
insurance in an amount not less than $300,000,000, with deductibles and subject
to an insurance assignment satisfactory to the Agent (other than with respect to
North American Pipe Corporation or Westech Building Products, Inc. for which no
business interruption insurance is required absent a change in circumstances).

(b) Notwithstanding the foregoing, each Borrower shall maintain insurance with
respect to the Collateral, covering casualty, hazard, public liability, theft,
malicious mischief, flood and other risks, in amounts, with endorsements and
with insurers (with a Best Rating of at least A7, unless otherwise approved by
the Agent) satisfactory to the Agent. From time to time upon request, the
Borrowers shall deliver to the Agent ACORD certificates of insurance or, upon
request, certified copies of its insurance policies. Unless the Agent shall
agree otherwise, each policy shall include satisfactory endorsements (i) showing
the Agent as a loss payee as to the

 

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Collateral or additional insured, as appropriate; (ii) requiring at least ten
(10) days prior written notice to the Agent in the event of cancellation of the
policy; and (iii) specifying that the interest of the Agent in the property
insured will not be invalidated by: (A) any act or neglect of any Borrower or
the owner of the property, (B) foreclosure, notice of sale, or similar
proceedings with respect to the property, (C) change in the title or ownership
of the property, or (D) change to a more hazardous occupancy. If any Borrower
fails to provide and pay for any insurance, the Agent may, at its option, but
shall not be required to, procure the insurance and charge the Borrowers
therefor. While no Event of Default exists, the Borrowers may settle, adjust or
compromise any insurance claim, as long as the proceeds are delivered to the
Agent in accordance with Section 7.6. If an Event of Default exists, only the
Agent shall be authorized to settle, adjust and compromise such claims.

7.6 Insurance and Condemnation Proceeds. The Borrowers shall promptly notify the
Agent of any loss, damage, or destruction to the Collateral, whether or not
covered by insurance, other than any loss, damage, or destruction involving an
amount or fair market value of less than $5,000,000 in the aggregate for each
occurrence (“Minor Insurance Events”). Other than with respect to Minor
Insurance Events, the Agent is hereby authorized to collect all insurance and
condemnation proceeds in respect of the Collateral directly and, after deducting
from such proceeds the reasonable expenses, if any, incurred by the Agent in the
collection or handling thereof, the Agent shall apply such proceeds, ratably, to
the reduction of the Obligations (but not a reduction of the Maximum Revolver
Amount) in the order provided for in Section 3.7. In the case of any loss,
damage, or destruction to any assets of the Loan Parties that includes
Collateral and other assets of the Loan Parties, the Loan Parties shall deliver
to the Agent satisfactory evidence of the amount of the insurance and
condemnation proceeds that are attributable to the Collateral; if the Agent is
not satisfied with such evidence, the Agent may, at the expense of the Loan
Parties, retain an independent third party to perform such valuation.

7.7 Environmental Laws.

(a) Each Loan Party shall, and shall cause each of their Subsidiaries to,
conduct its business in compliance with all Environmental Laws applicable to it,
including those relating to the generation, handling, use, storage, and disposal
of any Hazardous Material, except where the failure to do so could not
reasonably be expected to have a Material Adverse Effect. Each Loan Party shall,
and shall cause each of its Subsidiaries to, take prompt and appropriate action
to respond to any material non-compliance with Environmental Laws and shall
report to the Agent any such material non-compliance and any such response.

(b) Without limiting the generality of the foregoing, the Borrowers shall submit
to the Agent and the Lenders annually, commencing on the first Anniversary Date,
and on each Anniversary Date thereafter, an update of the status of each
material environmental noncompliance or material liability issue of a Loan Party
with respect to its property that is reasonably expected to result in liability
equal to or greater than $25,000,000. The Agent or any Lender may request copies
of technical reports prepared by any Loan Party and their communications with
any Governmental Authority to determine whether any Loan Party or any of their
Subsidiaries is proceeding reasonably to correct, cure, or contest in good faith
any alleged non-compliance or environmental liability. The Borrowers shall, at
the Agent’s or the Required Lenders’ request and at the Borrowers’ expense,
(i) retain an independent environmental engineer acceptable to the Agent to
evaluate the site, including tests if appropriate, where the material
non-compliance or alleged material non-compliance with Environmental Laws has
occurred and prepare and deliver to the Agent a report setting forth the results
of such evaluation, a proposed plan for responding to any environmental problems
described therein, and an estimate of the costs thereof, and (ii) provide to the
Agent and the Lenders a supplemental report of such engineer whenever the scope
of the environmental problems, or the response thereto or the estimated costs
thereof, shall increase in any material respect.

 

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7.8 Compliance with ERISA. Each Loan Party shall, and shall cause each of its
ERISA Affiliates to: (a) maintain each Plan in compliance in all material
respects with the applicable provisions of ERISA, the Code, and other federal or
state law; (b) cause each Plan which is qualified under Section 401(a) of the
Code to maintain such qualification; (c) make all required contributions to any
Plan subject to Section 412 of the Code; (d) not engage in a prohibited
transaction or violation of the fiduciary responsibility rules with respect to
any Plan which could reasonably be expected to result in liability to any Loan
Party in excess of $15,000,000 and (e) not engage in a transaction that could be
subject to Section 4069 or 4212(c) of ERISA.

7.9 Mergers; Consolidations; or Sales. No Loan Party nor any of their Restricted
Subsidiaries shall enter into any transaction of merger or consolidation, other
than (a) as permitted by Section 7.25, or (b) mergers among Loan Parties;
provided that, in any merger involving a Borrower, a Borrower must be the
surviving entity. No Loan Party nor any of their Restricted Subsidiaries shall
transfer, sell, assign, lease, or otherwise dispose of all or any part of its
property (including, without limitation, the stock or equity of any Restricted
Subsidiary of such Loan Party except as expressly permitted by the immediately
preceding sentence), or wind up, liquidate, or dissolve, except:

(i) sales of Inventory in the ordinary course of its business;

(ii) sales or other dispositions of Equipment in the ordinary course of business
that are damaged, worn-out, obsolete, or no longer used or useable by any Loan
Party in its respective business;

(iii) sales, leases, or other transfers or dispositions among Loan Parties;

(iv) the sale, discount, or transfer of delinquent Accounts that are not
Eligible Accounts in the ordinary course of business for purposes of collection,
so long as no Default or Event of Default exists;

(v) Distributions permitted by Section 7.10;

(vi) dispositions pursuant to mergers and consolidations permitted by
Section 7.9(a);

(vii) dispositions in connection with any Restricted Investments permitted by
Section 7.10;

(viii) leases, subleases, licenses, sublicenses, or transfers of property not
constituting Collateral (except for Proprietary Rights) (including the provision
of software under an open source license), in each case to Joint Ventures or JV
Subsidiaries or otherwise in the ordinary course of business and which do not
materially interfere with the business of the Loan Parties or any Restricted
Subsidiary, so long as (A) such leases, subleases, licenses or sublicenses, or
transfer do not adversely affect the Agent’s enforcement of its rights in any
Collateral, or (B) if the property leased, subleased, licensed, sublicensed, or
transferred is Proprietary Rights, such Joint Venture, JV Subsidiary, or other
Person grants a royalty free license to the Agent to use the Proprietary Rights
in connection with the Agent’s enforcement of its rights in any Collateral;

 

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(ix) subject to Section 7.6, transfers of property as a result of casualty
events;

(x) so long as no Default or Event of Default then exists or arises as a result
thereof, the wind up, liquidation, or dissolution of any Restricted Subsidiary
that is not a Loan Party, unless the assets of the dissolved Loan Party will be
transferred to another Loan Party at such dissolution, wind up, or liquidation,
if Westlake determines in good faith that such wind up, liquidation or
dissolution is in the best interest of Westlake and is not materially
disadvantageous to the Lenders;

(xi) the issuance of Capital Stock by any Loan Party, or any Restricted
Subsidiary thereof, to any Loan Party, to the extent not otherwise prohibited by
the terms of this Agreement;

(xii) dispositions of cash and Cash Equivalents, and dispositions of assets in
securities, brokerage and commodity accounts, each in the ordinary course of
business in connection with transactions permitted hereunder;

(xiii) dispositions in connection with any sale and leaseback transaction
permitted by Section 7.18; and

(xiv) so long as (A) no Default or Event of Default then exists or arises as a
result thereof, and (B) any mandatory prepayments required by Section 3.3(a), if
any are required, are made, sales of assets not constituting Collateral, other
than those in clauses (i) through (xiii), for fair value, provided that the Loan
Parties or their Restricted Subsidiaries shall receive not less than 75% of the
purchase price in the form of Permitted Consideration. All assets purchased with
such proceeds shall be free and clear of all Liens, except the Agent’s Liens or
other Permitted Liens.

7.10 Distributions; Capital Change; Restricted Investments. No Loan Party nor
any of their Restricted Subsidiaries shall:

(a) directly or indirectly declare or make, or incur any liability to make, any
Distribution (other than Distributions payable in Capital Stock (other than
Disqualified Stock) of Westlake), except:

(i) Distributions made and/or declared by wholly owned Subsidiaries;

(ii) Distributions made and/or declared by Westlake and non-wholly owned
Subsidiaries, if, on a pro forma basis after giving effect to such Distribution:
(A) the Availability equals or exceeds the greater of (x) 25% of the Maximum
Revolver Amount and (y) $100,000,000; or (B) to the extent the requirement in
clause (A) is not met, (I) the Availability equals or exceeds the greater of
(x) 17.5% of the Maximum Revolver Amount and (y) $70,000,000 and (II) the Fixed
Charge Coverage Ratio is at least 1.0:1.0; and

(iii) without limiting the amount permitted under clause (ii) above,
Distributions made and/or declared by Westlake and non-wholly owned Subsidiaries
in the aggregate of up to $25,000,000, if, on a pro forma basis after giving
effect to such Distribution, either (A) the Availability equals or exceeds the
greater of (x) 17.5% of the Maximum Revolver Amount and (y) $70,000,000, or
(B) the Fixed Charge Coverage Ratio is at least 1.0:1.0;

 

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provided that for purposes of a Distribution, the Availability shall be
calculated based on the most recent Borrowing Base Certificate delivered
pursuant to this Agreement prior to such Distribution (provided that the amount
of Eligible Cash shall be the amount on deposit on the date of such Distribution
and provided further that the Aggregate Revolver Outstandings shall be
calculated on the date of such Distribution) and Distributions are permitted
hereunder only if no Default or Event of Default then exists and only to the
extent that any such Distribution is made and/or declared in accordance with
applicable Requirement of Law and constitutes a valid, non voidable transaction.

(b) make any change in its capital structure which could reasonably be expected
to have a Material Adverse Effect; or

(c) make any Restricted Investment, except:

(i) Restricted Investment made by the Loan Parties, if on a pro forma basis
after giving effect to such Restricted Investment, (A) the Availability equals
or exceeds the greater of (x) 25% of the Maximum Revolver Amount and
(y) $100,000,000; or (B) to the extent the requirement in clause (A) is not met,
(I) the Availability equals or exceeds the greater of (x) 17.5% of the Maximum
Revolver Amount and (y) $70,000,000 and (II) the Fixed Charge Coverage Ratio is
at least 1.0:1.0; and

(ii) without limiting the amount permitted under clause (i) above, Restricted
Investment made by the Loan Parties in the aggregate of up to $25,000,000, if on
a pro forma basis after giving effect to such Restricted Investment, either
(A) the Availability equals or exceeds the greater of (x) 17.5% of the Maximum
Revolver Amount and (y) $70,000,000, or (B) the Fixed Charge Coverage Ratio is
at least 1.0:1.0;

provided that no Restricted Investment shall be permitted if a Default or Event
of Default has occurred and is continuing or would be caused by such Restricted
Investment; provided further that if any payment, prepayment, redemption,
defeasance, purchase, or deposit in respect of any Debt of the Loan Parties is
permitted to be made under Section 7.14(b), and such payment, prepayment,
redemption, purchase, or deposit otherwise constitutes a Restricted Investment,
such payment, prepayment, redemption, defeasance, purchase, or deposit shall not
be prohibited by the terms of this Section 7.10(c).

For purposes of calculating the Availability in connection with the foregoing
Section 7.10(c), the Availability shall be calculated based on the most recent
Borrowing Base Certificate delivered pursuant to this Agreement prior to such
Restricted Investment (provided that the amount of Eligible Cash shall be the
amount on deposit on the date of such Restricted Investment and provided further
that the Aggregate Revolver Outstandings shall be calculated on the date of such
Restricted Investment).

Notwithstanding the foregoing, the preceding provisions shall not prohibit:

(i) the payment of any dividend within sixty (60) days after the date of
declaration of the dividend, if at the date of declaration, the dividend payment
would have complied with the provisions of this Agreement;

(ii) so long as no Default or Event of Default has occurred and is continuing or
would be caused thereby, (A) the repurchase, redemption or other acquisition or
retirement for value of any Capital Stock of any Loan Party held by any current
or former officer, director or employee of any Loan Party pursuant to any equity
subscription agreement, stock option agreement, shareholders’ agreement or
similar plan or agreement, or (B) the repurchase of Capital Stock deemed to
occur upon the exercise of

 

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stock options to the extent such Capital Stock represent a portion of the
exercise price of those stock options; provided that the aggregate price paid
for all transactions under the foregoing (A) and (B) may not exceed $1,000,000
in any twelve-month period.

7.11 Transactions Affecting Collateral or Obligations. No Loan Party nor any of
their Restricted Subsidiaries shall enter into any transaction which would be
reasonably expected to have a Material Adverse Effect.

7.12 Guaranties. No Loan Party nor any of their Restricted Subsidiaries shall
make, issue, or become liable on any Guaranty, except (a) Obligation Guaranties
in favor of the Agent, (b) Guaranties of Debt permitted by Section 7.13,
(c) unsecured Guaranties by Westlake of another Loan Party for goods furnished
or services rendered in the ordinary course of business of such Loan Party,
(d) a Guaranty by Westlake Olefins Corporation for the account of Suzhou Huasu
Plastics Co. Ltd. in an aggregate amount not to exceed $8,500,000, and (e) to
the extent constituting a Restricted Investment permitted by Section 7.10.

7.13 Debt. No Loan Party shall incur or maintain any Debt, other than:

(a) the Obligations;

(b) Debt existing on the Closing Date and described on Schedule 7.13;

(c) Capital Leases, mortgage financings or purchase money obligations, in each
case, incurred for the purpose of financing all or any part of the purchase
price or cost of design, construction, installation or improvement of property,
plant or equipment, in each case, not constituting Inventory; provided that
(i) Liens securing the same are permitted by clause (p) of the definition of
“Permitted Liens,” and (ii) the aggregate principal amount of purchase money
obligations of the Loan Parties constituting Debt outstanding does not exceed
$150,000,000 at any time;

(d) the Bond Debt;

(e) other unsecured Debt;

(f) Debt evidencing a substantially concurrent (substantially concurrent shall
be not more than forty-five (45) days prior to any refunding, renewal,
extension, defeasance, or replacement of Debt) refunding, renewal, extension,
defeasance, or replacement (“Refinancing”) of the Debt existing on the Closing
Date and described on Schedule 7.13 and other Debt permitted hereunder (the
“Replaced Debt”); provided that in the case of any such secured debt (i) the
principal amount thereof is not increased, except in an amount equal to all
accrued interest on such Replaced Debt and the amount of fees, expenses and
premiums incurred in connection with such Refinancing, (ii) the Liens, if any,
securing such Debt do not attach to any assets in addition to those types of
assets, if any, securing the Replaced Debt, (iii) no Person that is not an
obligor or guarantor of such Replaced Debt as of such date shall become as of
such date, an obligor or guarantor thereof, and (iv) the terms of such
refunding, renewal, or extension are not materially less favorable, taken as a
whole, to the Borrowers, the Agent, or the Lenders than the Replaced Debt,
including, without limitation, the maturity date thereof and any principal
amortization thereof;

(g) Debt of any Loan Party owed to any Restricted Subsidiaries, or Debt of any
Restricted Subsidiary owed to the owner of its Capital Stock which is a Loan
Party;

 

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(h) Debt to finance insurance premiums in an amount not to exceed $10,000,000 at
any time outstanding;

(i) Debt arising under Hedge Agreements or the Gas Supply/Purchase Agreement;

(j) Debt among Loan Parties on terms of the kind customarily employed to
allocate charges among members of a consolidated group of entities, in each such
case, that are fair and reasonable to the Loan Parties and consistent with past
practices of the Loan Parties;

(k) Guaranties permitted by Section 7.12;

(l) Debt constituting Limited Recourse Stock Pledges; and

(m) Debt, other than those in clauses (a) through (l) above, secured by Liens on
assets not constituting Collateral, in the aggregate principal amount
outstanding at any time not to exceed the greater of (i) $600,000,000 and
(ii) 30% of Tangible Assets.

7.14 Payment / Prepayment of Debt. The Loan Parties shall not,

(a) except as expressly permitted by clause (b) hereof, voluntarily prepay any
principal of, or interest on, any other Debt, including the Bond Debt, except:

(i) the Obligations in accordance with the terms of this Agreement;

(ii) the Debt in connection with the IRBs;

(iii) prepayments of the Debt permitted by Section 7.13(g) or (i);

(iv) so long as no Default or Event of Default has occurred and is continuing
after giving effect to such prepayment, prepayment of any Debt with funds
constituting unrestricted cash;

(v) refinancings, refundings, renewals, extensions, replacements, or defeasances
of other Debt to the extent such refinancing, refunding, renewal, extension,
replacement, or defeasance is permitted by Section 7.13, whether subordinate to
the Obligations or not; or

(vi) payment from the net cash proceeds of, or in exchange for, an Equity
Issuance by Westlake (other than to another Loan Party or Subsidiary thereof);
and

(b) shall not, directly or indirectly, pay, prepay, redeem, defease, or
purchase, or deposit funds or property for the payment (including, without
limitation, a payment in respect of any sinking fund or defeasance of any Bond
Debt), prepayment, redemption, defeasance, or purchase of, any Bond Debt except:

(i) regularly scheduled interest and principal payments on Bond Debt made in
compliance with the provisions thereof;

(ii) so long as no Default or Event of Default has occurred and is continuing
after giving effect to such prepayment, redemption, or defeasance, redemptions,
defeasance, or prepayments (whether voluntary or mandatory, and including
redemptions of the GO Zone/Ike Zone debt in connection with an “Extraordinary
Optional Redemption”) of the Bond Debt with funds constituting restricted or
unrestricted cash;

 

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(iii) refinancings, refundings, renewals, extensions, replacements, or
defeasances of any Bond Debt to the extent such refinancing, refunding, renewal,
extension, replacement, or defeasance is permitted by Section 7.13; and

(iv) payment from the net cash proceeds of, or in exchange for, an Equity
Issuance by Westlake (other than to another Loan Party or Subsidiary thereof).

7.15 Transactions with Affiliates. Except as permitted by Section 7.9(a) or
7.12, or as set forth below, no Loan Party shall sell, transfer, distribute, or
pay any money or property, including, but not limited to, any fees or expenses
of any nature (including, but not limited to, any fees or expenses for
management services), to any Affiliate, or lend or advance money or property to
any Affiliate, or invest in (by capital contribution or otherwise) or purchase
or repurchase any stock or indebtedness (other than the Obligation Guaranties),
or any property, of any Affiliate, or become liable on any Guaranty of the
indebtedness, dividends, or other obligations of any Affiliate other than
(a) transactions between the Loan Parties on terms of the kind customarily
employed to allocate charges among members of a consolidated group of entities,
in each such case, that are fair and reasonable to the Loan Parties and
consistent with past practices of the Loan Parties, and (b) (i) transactions
with respect to tax sharing agreements that became effective prior to the date
hereof, and (ii) transactions with respect to tax sharing agreements that became
effective on or after the date hereof so long as (x) the Loan Parties do not pay
more taxes in the aggregate pursuant to such tax sharing agreement described in
this clause (ii) than the Loan Parties in the aggregate would be required to pay
if each Loan Party filed a separate tax return, or (y) the tax sharing agreement
described in this clause (ii) replaces a prior tax sharing agreement and the
Loan Parties do not pay more taxes in the aggregate pursuant to the tax sharing
agreement than the Loan Parties would have paid in the aggregate under such
prior tax sharing agreement. Notwithstanding the foregoing, while no Event of
Default has occurred and is continuing and so long as otherwise permitted in
this Agreement, the Loan Parties and their Restricted Subsidiaries may engage in
transactions with Affiliates in amounts and on terms no less favorable to the
Loan Parties and their Restricted Subsidiaries than would be obtained in a
comparable arm’s-length transaction with a third party who is not an Affiliate;
provided that the foregoing restrictions shall not apply to:

(i) any Distribution and Restricted Investments permitted by Section 7.10;

(ii) any transactions between or among any Loan Parties;

(iii) any transactions with a Person (other than an Unrestricted Subsidiary)
that is an Affiliate of a Loan Party solely because such Loan Party owns,
directly or indirectly through a Restricted Subsidiary, Capital Stock in, or
controls, such Person;

(iv) payment of reasonable directors’ fees to Persons who are not otherwise
Affiliates of Westlake; or

(v) any issuance of Equity Interests not otherwise prohibited by this Agreement.

7.16 Business Conducted. No Loan Party will, directly or indirectly, permit or
suffer to exist any material change in the type of businesses in which it is
engaged from the businesses of the Loan Parties as conducted on the Closing Date
and in similar or related businesses that are reasonable extensions or additions
to the Loan Parties’ business on the Closing Date.

 

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7.17 Liens. No Loan Party shall create, incur, assume, or permit to exist any
Lien on any property now owned or hereafter acquired by any of them, except
Permitted Liens.

7.18 Sale and Leaseback Transactions. No Loan Party or any of their Restricted
Subsidiaries shall, directly or indirectly, enter into any arrangement with any
Person providing for such Loan Party or such Restricted Subsidiary to lease or
rent property that such Loan Party or such Restricted Subsidiary has sold or
will sell or otherwise transfer to such Person, except for sale and leaseback
transactions with respect to which the obligations of the Loan Parties do not
exceed $150,000,000, in the aggregate, at any time.

7.19 New Subsidiaries. No Loan Party shall, directly or indirectly, organize,
create, acquire, or permit to exist any Subsidiary without giving the Agent at
least ten (10) days prior written notice of such organization, creation, or
acquisition (or such lesser time as agreed to by the Agent in its sole
discretion). The Borrowers shall cause each Person that becomes a Restricted
Subsidiary of any Loan Party after the Closing Date (whether as a result of
acquisition, merger, creation, or otherwise), (a) to execute an Obligation
Guaranty promptly after the date such entity becomes a Restricted Subsidiary of
a Loan Party and promptly deliver (but in no event later than ten (10) days
following distribution by the Agent or its counsel of such Obligation Guaranty
for execution) such Obligation Guaranty to the Agent and (b) to execute and
deliver to the Agent all required Collateral Documents (substantially in the
form of any comparable Collateral Documents delivered under the Existing Credit
Agreement or otherwise acceptable to the Agent and in no event later than ten
(10) days following distribution by the Agent or its counsel of such Collateral
Documents for execution) creating Agent’s Liens in favor of the Agent in the
Collateral owned by such Restricted Subsidiary.

7.20 Fiscal Year. No Loan Party shall change its Fiscal Year.

7.21 Fixed Charge Coverage Ratio. Effective on and during the continuance of the
Triggering Date and based on the most recently delivered Financial Statements
received pursuant to Section 5.2, the Borrowers will maintain a Fixed Charge
Coverage Ratio for each period of immediately preceding twelve (12) months of
not less than 1.0 to 1.0.

7.22 Use of Proceeds. No Loan Party shall nor shall a Loan Party suffer or
permit any Restricted Subsidiary to, use any portion of the Loan proceeds,
directly or indirectly, (a) to purchase or carry Margin Stock, (b) to repay or
otherwise refinance indebtedness of the Borrowers or others incurred to purchase
or carry Margin Stock, (c) to extend credit for the purpose of purchasing or
carrying any Margin Stock, or (d) to acquire any security in any transaction
that is subject to Section 13 or 14 of the Exchange Act.

7.23 Collateral. (a) To secure the full and complete payment and performance of
the Obligations, the Loan Parties shall (and shall cause each Restricted
Subsidiary to) enter into Collateral Documents (substantially in the form of
comparable Collateral Documents delivered under the Existing Credit Agreement or
otherwise acceptable to the Agent) pursuant to which, among other things, each
such entity shall, to the extent permitted by applicable law, grant, pledge,
assign, and create first priority Agent’s Liens (except to the extent Permitted
Liens affect such priority) in and to all Collateral owned by such entity.

(b) Notwithstanding anything to the contrary in this Agreement or any other Loan
Document, obligations of any Loan Party to any Lender or any Affiliate of any
Lender (other than the Bank or any Affiliate of the Bank, in which case no
notice shall be required) under or in connection with any Hedge Agreement
constituting Bank Product shall not constitute Pari Passu Bank Product
Obligations except to the extent that such Lender or its Affiliate and the
applicable

 

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Loan Party have prior to or promptly following the entering into of the
applicable Hedge Agreement, delivered a written notice of the Bank Product
Termination Value of the obligations of any Loan Party to such Lender or such
Affiliate of such Lender under such Hedge Agreement to be included in Pari Passu
Bank Product Obligations, together with a description of the methodology to be
used by such parties in determining the Bank Product Termination Value from time
to time, and the Agent has acknowledged receipt of such notice in writing, which
acknowledgement shall be promptly delivered by the Agent following receipt of
such notice. Upon receipt of such notice, the Agent shall establish a Bank
Product Reserve in the amount of such Bank Product Termination Value.

(c) The Bank Product Termination Value (other than with respect to the Bank or
any Affiliate of the Bank, in which case no notice shall be required) may be
changed from time to time upon written notice to the Agent by the applicable
Lender or Affiliate thereof. Any such increase in the Bank Product Termination
Value shall not constitute a portion of the Pari Passu Bank Product Obligations
until the Agent shall have received written notice of such increase as set forth
above, and the Agent has acknowledged receipt of such notice in writing, which
acknowledgement shall be promptly delivered by the Agent following receipt of
such notice. Upon receipt of such notice, the Agent shall adjust the applicable
Bank Product Reserve by the amount specified in such notice.

(d) The provisions of this Section 7.23 shall continue to apply to any Hedge
Agreement entered into by any Lender or its Affiliates, in the event the Lender
ceases to be a Lender pursuant to Section 4.9, 11.1(c), or 11.2 hereof, and each
Lender may continue to provide reports of increase of Bank Product Termination
Values to the Agent until the Hedge Agreement is terminated or this Agreement is
terminated pursuant to Section 10.1 or otherwise, but all other Bank Products of
any Lender or its Affiliates shall cease to be a part of the Obligations in the
event any Lender ceases to be a Lender hereunder.

(e) No Bank Product Termination Value may be established or increased at any
time that a Default or Event of Default exists, or if creating a Reserve against
such Bank Product Termination Value or the increase thereof would cause the
Obligations to exceed the Borrowing Base, except with respect to obligations of
any Loan Party under or in connection with any Bank Products (other than Hedge
Agreements) of the Bank or any Affiliate of Bank.

(f) With respect to the obligations of the Loan Parties to the Bank or any
Affiliate of the Bank under any Hedge Agreement, the amount determined by the
Bank or any Affiliate of the Bank, and reflected on the documentation and
records of the Bank or of such Affiliate shall be part of the Pari Passu Bank
Product Obligations. No Bank Product Termination Value under or in connection
with any Hedge Agreement of the Bank or any Affiliate of the Bank may be
established or increased at any time that a Default or Event of Default exists,
or if creating a Reserve against such Bank Product Termination Value or the
increase thereof would cause the Obligations to exceed the Borrowing Base.

(g) Lenders (other than the Bank or any Affiliate of the Bank, but including
Lenders who cease to be Lenders hereunder as described in paragraph (d) above)
agree to report Bank Product Termination Value to Agent as requested by Agent
from time to time.

(h) The Agent may, but shall not be required to, from time to time, at any time,
establish Reserves with respect to Bank Products (other than Hedge Agreements)
provided by (i) the Bank or an Affiliate of the Bank, or (ii) any other Lender
or any Affiliate of any Lender provided that such Lender or Affiliate shall
provide notice of such Bank Product to the Agent in accordance with the
procedures set forth in this Section 7.23 with respect to Hedge Agreements, and
the Agent has received and acknowledged such notice.

 

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7.24 Tax Shelter Regulations.

(a) The Borrowers do not intend to treat the Revolving Loans and/or Letters of
Credit and related transactions as being a “reportable transaction” (within the
meaning of Treasury Regulation Section 1.6011-4). In the event the Borrowers
determine to take any action inconsistent with such intention, it will promptly
notify the Agent thereof. If the Borrowers so notify the Agent, the Borrowers
acknowledge that one or more of the Lenders may treat its Loans and/or its
interest in Non-Ratable Loans and/or Agent Advances and/or Letters of Credit as
part of a transaction that is subject to Treasury Regulation Section 301.6112-1,
and such Lender or Lenders, as applicable, will maintain the lists and other
records required by such Treasury Regulation.

(b) Neither the Agent nor any Lender intends to treat the Revolving Loans and/or
Letters of Credit and related transactions as being a “reportable transaction”
(within the meaning of Treasury Regulation Section 1.6011-4). In the event the
Agent or any Lender determines to take any action inconsistent with this
intention, such person will so notify Westlake. If the Agent or any Lender so
notifies Westlake, the Agent and such Lender acknowledge that one or more of the
Borrowers may treat any Loans and/or Letter of Credit as part of a transaction
that is subject to Treasury Regulation Section 301.6112-1, and such Borrower or
Borrowers, as applicable, will maintain the lists and other records required by
such Treasury Regulation.

7.25 Permitted Acquisitions. The Loan Parties may consummate Acquisitions, so
long as:

(a) the Acquisition by a Loan Party is of a Person or assets which are in
substantially the same lines of business as the business conducted by such Loan
Party on the date hereof, or any other business reasonably related thereto;

(b) as of the closing thereof, each Acquisition has been approved and
recommended by the board of directors (or equivalent body) of the Person to be
acquired or from which such business or asset is to be acquired;

(c) prior to the closing of such Acquisition (other than an Acquisition of
assets), the Person to be acquired is Solvent;

(d) as of the closing of the Acquisition, after giving effect thereto, the Loan
Party that is the acquiring party must be Solvent and the Loan Parties, on a
consolidated basis, must be Solvent;

(e) if such Acquisition is structured as a merger by a Loan Party, a Loan Party
must be the surviving entity after giving effect to such merger;

(f) if such Acquisition is structured as a merger by a Borrower, a Borrower must
be the surviving entity after giving effect to such merger;

(g) as of the closing of any Acquisition, no Default or Event of Default shall
exist or occur as a result thereof, and after giving effect thereto;

 

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(h) if the Acquisition target is to be a Restricted Subsidiary, then the
Borrowers shall have complied with the terms and conditions of Section 7.19;

(i) the absence of action, suit, investigation, or proceeding pending or
threatened in a any court or before any arbitrator or Governmental Authority
that affects the target or the proposed Acquisition, which could reasonably be
expected to have a Material Adverse Effect on the target or the Loan Parties;

(j) immediately after giving effect to the Acquisitions, (A) the Availability
equals or exceeds the greater of (x) 25% of the Maximum Revolver Amount and
(y) $100,000,000; or (B) to the extent the requirement in clause (A) is not met,
(I) the Availability equals or exceeds the greater of (x) 17.5% of the Maximum
Revolver Amount and (y) $70,000,000 and (II) the Pro Forma Fixed Charge Coverage
Ratio is at least 1.0:1.0; provided that to the extent neither of the foregoing
requirements in this clause (j) is met, the Loan Parties may nevertheless
consummate Acquisitions in the aggregate of up to $25,000,000 if immediately
after giving effect to the Acquisitions, either (A) the Availability equals or
exceeds the greater of (x) 17.5% of the Maximum Revolver Amount and
(y) $70,000,000 but is less than the greater of (x) 25% of the Maximum Revolver
Amount and (y) $100,000,000, or (B) the Pro Forma Fixed Charge Coverage Ratio is
at least 1.0:1.0; and

(k) for the purposes of calculating the Availability under this Section 7.25, no
assets of the Person to be acquired or the assets to be acquired shall be
included in the Borrowing Base unless such assets are acceptable to the Agent.

For purposes of calculating the Availability in connection with the foregoing
clauses (j) and (k), the Availability shall be calculated based on the most
recent Borrowing Base Certificate delivered pursuant to this Agreement prior to
such Acquisition (provided that the amount of Eligible Cash shall be the amount
on deposit on the date of such Acquisition and provided further that the
Aggregate Revolver Outstandings shall be calculated on the date of such
Acquisition).

For purposes of Sections 7.25 and 7.10(c) only, notwithstanding anything in
Sections 7.25 or 7.10(c) to the contrary, (i) a series of investments not to
exceed $200,000,000 in one or more Joint Ventures which will own feedstock, raw
material and ethylene pipeline, storage and fractionating facilities, and
(ii) investments in Suzhou Huasu Plastics Co., Ltd. made on or prior to the date
hereof, plus additional investments therein not to exceed $55,000,000, shall
each be permitted hereunder, and no assets at any time owned by such Joint
Venture or Suzhou Huasu Plastics Co., Ltd. shall be included in the Borrowing
Base.

7.26 Excluded Deposit Accounts. In the event the amount of funds on deposit in
the Local Accounts ever exceeds $300,000 at any time in the aggregate on any
date of determination, the Borrowers shall immediately deliver to the Agent
Blocked Account Agreements with respect to each such Local Account.

7.27 Further Assurances. The Loan Parties shall execute and deliver, or cause to
be executed and delivered, to the Agent and/or any Lender such documents and
agreements, and shall take or cause to be taken such actions, as the Agent may,
from time to time, reasonably request to carry out the terms and conditions of
this Agreement and the other Loan Documents.

 

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ARTICLE 8.

CONDITIONS OF LENDING

8.1 Conditions Precedent to Making of Loans on the Closing Date. The obligation
of the Lenders to make the Revolving Loans on the Closing Date, and the
obligation of the applicable Letter of Credit Issuer to issue any Letter of
Credit on the Closing Date, are subject to the following conditions precedent
having been satisfied in a manner satisfactory to the Agent and each Lender:

(a) This Agreement and the other Loan Documents shall have been executed by each
party thereto and each Loan Party, as applicable, shall have performed and
complied with all covenants, agreements, and conditions contained herein and the
other Loan Documents which are required to be performed or complied with by the
Loan Parties before or on such Closing Date.

(b) Upon making the Revolving Loans on the Closing Date (including such
Revolving Loans made to finance the Closing Fee or otherwise as reimbursement
for fees, costs, and expenses then payable under this Agreement), and with all
its obligations current, the Borrowers shall have Availability of at least
$150,000,000.

(c) All representations and warranties made hereunder and in the other Loan
Documents shall be true and correct as if made on such date.

(d) No Default or Event of Default shall have occurred and be continuing after
giving effect to the Revolving Loans to be made and the Letters of Credit to be
issued on the Closing Date.

(e) The Agent and the Lenders shall have received such opinions of counsel for
the Loan Parties as the Agent or any Lender shall request, each such opinion to
be in a form, scope, and substance reasonably satisfactory to the Agent, the
Lenders, and their respective counsel.

(f) The Agent shall have received financing statements or amendments in proper
form for filing, under the UCC in all jurisdictions that the Agent may deem
necessary or desirable in order to perfect the Agent’s Liens.

(g) The Borrowers shall have paid all fees, including the amounts owing as of
the Closing Date under the Fee Letter, and expenses of the Agent and the
Attorney Costs incurred in connection with any of the Loan Documents and the
transactions contemplated thereby to the extent invoiced.

(h) The Agent shall have received evidence, in form, scope, and substance,
reasonably satisfactory to the Agent, of all insurance coverage as required by
this Agreement.

(i) The Agent and the Lenders shall have had an opportunity, if they so choose,
to examine the books of account and other records and files of the Loan Parties
and to make copies thereof, and to conduct a pre-closing audit which shall
include, without limitation, verification of Inventory, Accounts, and the
Borrowing Base, and the results of such examination and audit shall have been
satisfactory to the Agent and the Lenders in all respects.

(j) All proceedings taken in connection with the execution of this Agreement,
the Notes, all other Loan Documents, and all documents and papers relating
thereto shall be satisfactory in form, scope, and substance to the Agent and the
Lenders.

 

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(k) Each Loan Party shall have established all of its Deposit Accounts at the
Bank or shall have entered into Blocked Account Agreements (on terms acceptable
to the Agent) with respect to all Deposit Accounts not established at the Bank
other than immaterial local accounts of the Loan Parties (the “Local Accounts”)
so long as the amount of funds on deposit in such accounts does not exceed
$300,000 in the aggregate at any time.

(l) Since December 31, 2010, no event has occurred and is continuing, or would
result from such extension of credit, which has had or would (after giving
effect thereto) reasonably be expected to have a Material Adverse Effect.

(m) After giving effect to the incurrence of the Bond Debt and the incurrence of
Debt under this Agreement, the Agent shall be reasonably satisfied with the
corporate and capital structure and management of Westlake and its Subsidiaries.

(n) The Agent shall have received, each in form and substance satisfactory to
Agent the Financial Statements.

(o) Evidence satisfactory to the Lenders that no approval, consent, exemption,
authorization, or other action by, or notice to, or filing with, any
Governmental Authority or other Person is necessary or required in connection
with the execution, delivery or performance by, or enforcement against, any Loan
Party of this Agreement or any other Loan Document other than (i) those already
obtained, (ii) the filing of UCC financing statements, and (iii) the filing of
the Copyright Security Agreements and the Patent and Trademark Agreements.

(p) The Lenders are satisfied with the environmental matters concerning the Loan
Parties.

(q) Without limiting the generality of the items described above, each Loan
Party shall have delivered or caused to be delivered to the Agent (in form and
substance reasonably satisfactory to the Agent), the financial statements,
instruments, resolutions, documents, agreements, certificates, opinions, and
other items set forth on the “Closing Checklist” delivered by the Agent to
Westlake prior to the Closing Date.

The acceptance by the Borrowers of any Loans made or Letters of Credit issued on
the Closing Date shall be deemed to be a representation and warranty made by the
Borrowers to the effect that all of the conditions precedent to the making of
such Loans or the issuance of such Letters of Credit have been satisfied or
waived, with the same effect as delivery to the Agent and the Lenders of a
certificate signed by a Responsible Officer on behalf of the Borrowers, dated
the Closing Date, to such effect.

Execution and delivery to the Agent by a Lender of a counterpart of this
Agreement shall be deemed confirmation by such Lender that (i) all conditions
precedent in this Section 8.1 have been fulfilled to the satisfaction of such
Lender, (ii) the decision of such Lender to execute and deliver to the Agent an
executed counterpart of this Agreement was made by such Lender independently and
without reliance on the Agent or any other Lender as to the satisfaction of any
condition precedent set forth in this Section 8.1, and (iii) all documents sent
to such Lender for approval consent, or satisfaction were acceptable to such
Lender, unless the Agent shall have received notice from such Lender prior to
the proposed Closing Date specifying its objection with respect to the foregoing
clause (i), (ii), or (iii).

 

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8.2 Conditions Precedent to Each Loan. The obligation of the Lenders to make
each Loan, including the initial Revolving Loans on the Closing Date, and the
obligation of the applicable Letter of Credit Issuer to issue any Letter of
Credit shall be subject to the further conditions precedent that on and as of
the date of any such extension of credit:

(a) The following statements shall be true, and the acceptance by the Borrowers
of any extension of credit shall be deemed to be a statement to the effect set
forth in clauses (i), (ii), and (iii) with the same effect as the delivery to
the Agent and the Lenders of a certificate signed by a Responsible Officer on
behalf of the Loan Parties, dated the date of such extension of credit, stating
that:

(i) The representations and warranties contained in this Agreement and the other
Loan Documents are correct in all material respects on and as of the date of
such extension of credit as though made on and as of such date, other than any
such representation or warranty which relates to a specified prior date and
except to the extent the Agent and the Lenders have been notified in writing by
the Borrowers that any representation or warranty is not correct and the
Required Lenders have explicitly waived in writing compliance with such
representation or warranty;

(ii) No event has occurred and is continuing, or would result from such
extension of credit, which constitutes a Default or an Event of Default; and

(iii) No event has occurred and is continuing, or would result from such
extension of credit, which has had or would have a Material Adverse Effect since
the latest date of the Financial Statements delivered to the Lenders pursuant to
Section 5.2(a).

(b) No such Borrowing shall exceed Availability, provided, however, that the
foregoing conditions precedent set forth in this Section 8.2 are not conditions
to each Lender participating in or reimbursing the Bank or the Agent for such
Lenders’ Pro Rata Share of any Non-Ratable Loan or Agent Advance made in
accordance with the provisions of Sections 1.2(h) and (i).

ARTICLE 9.

DEFAULT; REMEDIES

9.1 Events of Default. It shall constitute an event of default (“Event of
Default”) if any one or more of the following shall occur for any reason:

(a) any failure or refusal by any Loan Party to pay (i) any principal of the
Obligations (other than Bank Products) when the same becomes due (whether by its
terms, by acceleration, or as otherwise provided in the Loan Documents); or
(ii) interest, fees, premium, or any other part of the Obligations (other than
Bank Products) within one day after the same becomes due and payable in
accordance with the Loan Documents, whether upon demand or otherwise;

(b) any representation or warranty made or deemed made by any Loan Party in this
Agreement or in any of the other Loan Documents, any Financial Statement, or any
certificate furnished by any Loan Party at any time to the Agent or any Lender
shall prove to be untrue in any material respect as of the date on which made,
deemed made, or furnished;

(c) (i) any default shall occur in the observance or performance of any of the
covenants and agreements contained in Sections 5.2(j), 7.2 (as to existence
only), 7.5, 7.9 through

 

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7.27, or Section 11 of the Security Agreement, (ii) any default shall occur in
the observance or performance of any of the covenants and agreements contained
in Sections 5.3 or 7.4 and such default shall continue for five (5) days or
more, provided that there are not more than, in the aggregate, three
(3) occurrences of any such default in any twelve (12) month period; or
(iii) any default shall occur in the observance or performance of any of the
other covenants or agreements (not specified in Sections 9.1(a), (b), (c)(i), or
(c)(ii)) contained in any other Section of this Agreement or any other Loan
Document and such default shall continue for thirty (30) days or more or
(iv) any default shall occur under Section 5.2 (other than clause (j) thereof)
and such default shall continue for 5 Business Days or more;

(d) any “default” or “event of default” shall occur with respect to any Debt
(other than the Obligations) of any Loan Party in an outstanding principal
amount which exceeds $20,000,000 (in the aggregate), or under any agreement or
instrument under or pursuant to which any such Debt may have been issued,
created, assumed, or guaranteed by any Loan Party, and such default shall
continue for more than the period of grace, if any, therein specified, if the
effect thereof (with or without the giving of notice or further lapse of time or
both) is to accelerate, or to permit the holders of any such Debt to accelerate,
the maturity of any such Debt; or any such Debt shall be declared due and
payable or be required to be prepaid prior to the stated maturity or redemption
date thereof; provided that this clause (d) shall not apply to secured Debt that
becomes due as a result of the voluntary sale or transfer of the property or
assets securing such Debt, if such sale or transfer is permitted hereunder and
under the documents providing for such Debt;

(e) (i) any Loan Party that is a Borrower or a Material Subsidiary shall
(A) file a voluntary petition in bankruptcy or file a voluntary petition or an
answer or otherwise commence any action or proceeding seeking reorganization,
arrangement, or readjustment of its debts or for any other relief under the
federal Bankruptcy Code, as amended, or under any other bankruptcy or insolvency
act or law, state or federal, now or hereafter existing, or consent to, approve
of, or acquiesce in, any such petition, action, or proceeding; (B) apply for or
acquiesce in the appointment of a receiver, assignee, liquidator, sequestrator,
custodian, monitor, trustee or similar officer for it or for all or any part of
its property; (C) make an assignment for the benefit of creditors; (D) be unable
generally to pay its debts as they become due; or (E) not be Solvent; or
(ii) the Loan Parties, on a consolidated basis, shall not be Solvent;

(f) an involuntary petition shall be filed or an action or proceeding otherwise
commenced seeking reorganization, arrangement, consolidation or readjustment of
the debts of any Loan Party that is a Borrower or a Material Subsidiary or for
any other relief under the federal Bankruptcy Code, as amended, or under any
other bankruptcy or insolvency act or law, state or federal, now or hereafter
existing and such petition or proceeding shall not be dismissed within sixty
(60) days after the filing or commencement thereof or an order of relief shall
be entered with respect thereto;

(g) a receiver, assignee, liquidator, sequestrator, custodian, monitor, trustee
or similar officer for any Loan Party that is a Borrower or a Material
Subsidiary or for all or any part of their respective property shall be
appointed or a warrant of attachment, execution, or similar process shall be
issued against any part of the property of Westlake or any of its Restricted
Subsidiaries;

(h) any Loan Party shall file a certificate of dissolution under applicable
state law or shall be liquidated, dissolved or wound-up or shall commence or
have commenced against it any action or proceeding for dissolution, winding-up
or liquidation, or shall take any corporate action in furtherance thereof except
as permitted under Sections 7.2 or 7.9;

 

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(i) all or any material part of the property of any Loan Party shall be
nationalized, expropriated, or condemned, seized, or otherwise appropriated, or
custody or control of such property or of such Loan Party shall be assumed by
any Governmental Authority or any court of competent jurisdiction at the
instance of any Governmental Authority, except where contested in good faith by
proper proceedings diligently pursued where a stay of enforcement is in effect;

(j) any Loan Document shall be terminated, revoked, or declared void, invalid,
or unenforceable or challenged by any Loan Party or any other obligor;

(k) one or more judgments, orders, decrees, or arbitration awards is entered
against the Loan Parties involving in the aggregate liability (to the extent not
covered by independent third-party insurance as to which the insurer does not
dispute coverage) as to any single or related or unrelated series of
transactions, incidents or conditions, of $20,000,000 or more, and either
(i) enforcement proceedings are commenced upon such judgment, order, decree, or
award, or (ii) there is a period of 30 consecutive days during which a stay of
enforcement of such judgment, order, decree, or award, by reason of pending
appeal or otherwise, is not in effect;

(l) any loss, theft, damage, or destruction of any item or items of Collateral
or other property of any Loan Party occurs which could reasonably be expected to
cause a Material Adverse Effect and is not adequately covered by insurance;

(m) there is filed against any Loan Party any action, suit, or proceeding under
any federal or state racketeering statute (including the Racketeer Influenced
and Corrupt Organization Act of 1970), which action, suit, or proceeding (i) is
not dismissed within one hundred twenty (120) days, and (ii) could reasonably be
expected to result in the confiscation or forfeiture of any material portion of
the Collateral;

(n) for any reason other than the failure of the Agent to take any action
available to it to maintain perfection of the Agent’s Liens, pursuant to the
Loan Documents, any Loan Document ceases to be in full force and effect or any
Lien with respect to any material portion of the Collateral intended to be
secured thereby ceases to be, or is not, valid, perfected, and prior to all
other Liens (other than Permitted Liens) or is terminated, revoked, or declared
void;

(o) (i) an ERISA Event shall occur with respect to a Pension Plan or
Multi-Employer Plan which has resulted or could reasonably be expected to result
in liability of any Loan Party under Title IV of ERISA to the PBGC in an
aggregate amount in excess of $15,000,000; or (ii) any Loan Party or any ERISA
Affiliate shall fail to pay when due, after the expiration of any applicable
grace period, any installment payment with respect to its withdrawal liability
under Section 4201 of ERISA under a Multi-employer Plan in an aggregate amount
in excess of $15,000,000;

(p) there occurs a Change of Control;

(q) other than those existing on the Closing Date and disclosed on
Schedule 6.13, any Environmental Liabilities in excess of $20,000,000 (to the
extent not covered by independent third-party insurance as to which the insurer
does not dispute coverage), but excluding: (i) Environmental Liabilities in an
aggregate amount at any time up to $35,000,000 for which a Reserve is
established for 100% of such aggregate amount; and (ii) amounts in excess of
$35,000,000 secured by a perfected first lien on cash collateral equal to 100%
of that portion of such amount in excess of the Reserves described in clause
(i); or

 

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(r) Except to the extent such Debt is prepaid or redeemed in compliance with
Section 7.14, an event shall occur, including, without limitation, a “change in
control” or “change of control” as defined in any documents or agreements
evidencing or creating the Bond Debt and (i) the trustee or the required holders
of any such Debt shall initiate notice under provisions governing such Debt to
require (or any Loan Party shall automatically be so required) to redeem or
repurchase such Debt, or (ii) any Loan Party shall initiate notice to holders of
the Bond Debt in connection with a redemption of such Debt.

9.2 Remedies.

(a) If a Default or an Event of Default exists, the Agent may, in its
discretion, and shall, at the direction of the Required Lenders, do one or more
of the following at any time or times and in any order, without notice to or
demand on the Borrowers: (i) restrict the amount of or refuse to make Revolving
Loans; (ii) restrict or refuse to provide Letters of Credit or Credit Support;
and (iii) provide written notice to the trustee under the IRB that a default has
occurred and requesting acceleration of the maturity of the IRBs. If an Event of
Default exists, the Agent, may, in its discretion, and shall, at the direction
of the Required Lenders, reduce the Maximum Revolver Amount, or the advance
rates against Eligible Accounts and/or Eligible Inventory used in computing the
Borrowing Base, or reduce one or more of the other elements used in computing
the Borrowing Base. In addition, if an Event of Default exists, the Agent shall,
at the direction of the Required Lenders, do one or more of the following, in
addition to the actions described in the preceding sentence, at any time or
times and in any order, without notice to or demand on the Borrowers:
(A) terminate the Commitments and this Agreement; (B) declare any or all
Obligations (other than Obligations with respect to Bank Products) to be
immediately due and payable; provided, however, that upon the occurrence of any
Event of Default described in Sections 9.1(e), 9.1(f), 9.1(g), or 9.1(h), the
Commitments shall automatically and immediately expire and all Obligations shall
automatically become immediately due and payable without notice or demand of any
kind; (C) require the Borrowers to cash collateralize all outstanding Letter of
Credit Obligations; and (D) pursue its other rights and remedies under the Loan
Documents and applicable law.

(b) If an Event of Default has occurred and is continuing: (i) the Agent shall
have for the benefit of the Lenders, in addition to all other rights of the
Agent and the Lenders, the rights and remedies of a secured party under the Loan
Documents and the UCC; (ii) the Agent may, at any time, take possession of the
Collateral and keep it on any Loan Party’s premises, at no cost to the Agent or
any Lender, or remove any part of it to such other place or places as the Agent
may desire, or the Loan Parties shall, upon the Agent’s demand, at the
Borrowers’ cost, assemble the Collateral and make it available to the Agent at a
place reasonably convenient to the Agent; and (iii) the Agent may sell and
deliver any Collateral at public or private sales, for cash, upon credit or
otherwise, at such prices and upon such terms as the Agent deems advisable, in
its sole discretion, and may, if the Agent deems it reasonable, postpone or
adjourn any sale of the Collateral by an announcement at the time and place of
sale or of such postponed or adjourned sale without giving a new notice of sale.
Without in any way requiring notice to be given in the following manner, the
Loan Parties agree that any notice by the Agent of sale, disposition, or other
intended action hereunder or in connection herewith, whether required by the UCC
or otherwise, shall constitute reasonable notice to such Loan Party if such
notice is mailed by registered or certified mail, return receipt requested,
postage prepaid, or is delivered personally against receipt, at least five
(5) Business Days prior to such action to Westlake’s address specified

 

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in or pursuant to Section 13.8. If any Collateral is sold on terms other than
payment in full at the time of sale, no credit shall be given against the
Obligations until the Agent or the Lenders receive payment, and if the buyer
defaults in payment, the Agent may resell the Collateral without further notice
to any Loan Party. In the event the Agent seeks to take possession of all or any
portion of the Collateral by judicial process, the Loan Parties irrevocably
waive to the extent permitted under applicable Law: (A) the posting of any bond,
surety, or security with respect thereto which might otherwise be required;
(B) any demand for possession prior to the commencement of any suit or action to
recover the Collateral; and (C) any requirement that the Agent retain possession
and not dispose of any Collateral until after trial or final judgment. The Loan
Parties agree that the Agent has no obligation to preserve rights to the
Collateral or marshal any Collateral for the benefit of any Person. The Agent is
hereby granted a license or other right to use, without charge, the Loan
Parties’ labels, patents, copyrights, name, trade secrets, trade names,
trademarks, and advertising matter, or any similar property, in advertising or
selling any Collateral, and unless the terms and provisions of such rights
provide otherwise, in completing production of any Collateral, and the Loan
Parties’ rights under all licenses and all franchise agreements shall inure to
the Agent’s benefit for such purpose. The proceeds of sale shall be applied
first to all expenses of sale, including attorneys’ fees, and then to the
Obligations. The Agent will return any excess to the Borrowers and the Borrowers
shall remain liable for any deficiency.

(c) If an Event of Default occurs and is continuing, the Loan Parties hereby
waive, to the extent permitted by applicable law, all rights to notice and
hearing prior to the exercise by the Agent of the Agent’s rights to repossess
the Collateral without judicial process or to reply, attach or levy upon the
Collateral without notice or hearing.

ARTICLE 10.

TERM AND TERMINATION

10.1 Term and Termination. The term of this Agreement shall end on the Stated
Termination Date unless sooner terminated in accordance with the terms hereof.
The Agent upon direction from the Required Lenders may terminate this Agreement
without notice upon the occurrence of an Event of Default. Upon the effective
date of termination of this Agreement for any reason whatsoever, all Obligations
(including all unpaid principal and accrued but unpaid interest, but excluding
Bank Products that the applicable Lender chooses not to terminate and indemnity
obligations that survive the termination of this Agreement and are not due and
payable at such termination) shall become immediately due and payable, and the
Borrowers shall immediately make Full Payment of all such Obligations.
Notwithstanding the termination of this Agreement, until the Agent has received
Full Payment of all Obligations (including all unpaid principal and accrued but
unpaid interest, but excluding Bank Products that the applicable Lender chooses
not to terminate and indemnity obligations that survive the termination of this
Agreement and are not due and payable at such termination), the Borrowers shall
remain bound by the terms of this Agreement and shall not be relieved of any of
their Obligations hereunder or under any other Loan Document, and the Agent and
the Lenders shall retain all their rights and remedies hereunder (including the
Agent’s Liens in and all rights and remedies with respect to all then existing
and after-arising Collateral).

 

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ARTICLE 11.

AMENDMENTS; WAIVERS; PARTICIPATIONS; ASSIGNMENTS; SUCCESSORS

11.1 Amendments and Waivers.

(a) No amendment or waiver of any provision of this Agreement or any other Loan
Document, and no consent with respect to any departure by the Loan Parties
therefrom, shall be effective unless the same shall be in writing and signed by
the Required Lenders (or by the Agent at the written request of the Required
Lenders) and the Borrowers and then any such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given; provided, however, that no such waiver, amendment, or consent shall,
unless in writing and signed by each Lender (including consent of a Defaulting
Lender with respect to clauses (i), (ii), and (iii) below) affected thereby and
the Borrowers and acknowledged by the Agent, do any of the following:

(i) increase or extend the Commitment of any Lender;

(ii) postpone or delay any date fixed by this Agreement or any other Loan
Document for any payment of principal, interest, fees (other than fees payable
solely to the Agent), or other amounts due to the Lenders (or any of them)
hereunder or under any other Loan Document;

(iii) reduce the principal of, or the rate of interest specified herein on any
Loan, or any fees or other amounts payable hereunder or under any other Loan
Document;

(iv) change the percentage of the Commitments or of the aggregate unpaid
principal amount of the Revolving Loans which is required for the Lenders or any
of them to take any action hereunder;

(v) increase any of the percentages set forth in the definition of the Borrowing
Base;

(vi) amend this Section or any provision of this Agreement providing for consent
or other action by all Lenders; provided that consent of each Defaulting Lender
shall be required to amend clause (i), (ii), or (iii) above;

(vii) release all or substantially all of the Obligation Guaranties or release
the Collateral other than as permitted by Section 12.10;

(viii) change the definitions of “Majority Lenders” or “Required Lenders”;

(ix) change the order of application of payments provisions in Section 3.7; or

(x) increase the Maximum Revolver Amount, the Maximum Inventory Loan Amount, or
Letter of Credit Subfacility;

provided, however, the Agent may, in its sole discretion and notwithstanding the
limitations contained in clauses (v) and (ix) above (other than the limitations
restricting the increase in the Maximum Revolver Amount) and any other terms of
this Agreement, make Agent Advances in accordance with Section 1.2(i) and,
provided further, that (A) no amendment, waiver, or consent shall, unless in
writing and signed by

 

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the Agent, affect the rights or duties of the Agent under this Agreement or any
other Loan Document; (B) no amendment, waiver, or consent shall, unless in
writing and signed by the Letter of Credit Issuers, affect the rights or duties
of the Letter of Credit Issuers under this Agreement or any other Loan Document;
(C) no amendment shall increase the Commitment of any Lender unless consented to
by such Lender (including a Defaulting Lender); and (D) Schedule 1.2 hereto
(Commitments) may be amended from time to time by the Agent alone to reflect
assignments of Commitments in accordance herewith.

(b) If any fees are paid to the Lenders as consideration for amendments,
waivers, or consents with respect to this Agreement, at the Agent’s election,
such fees may be paid only to those Lenders that agree to such amendments,
waivers or consents within the time specified for submission thereof.

(c) If, in connection with any proposed amendment, waiver or consent (a
“Proposed Change”):

(i) requiring the consent of all Lenders, the consent of Required Lenders is
obtained, but the consent of other Lenders is not obtained (any such Lender
whose consent is not obtained as described in this clause (i) and in clause
(ii) below being referred to as a “Non-Consenting Lender”), or

(ii) requiring the consent of Required Lenders, the consent of Majority Lenders
is obtained,

then, so long as the Agent is not a Non-Consenting Lender, at the Borrowers’
request, the Agent or an Eligible Assignee shall have the right (but not the
obligation) with the Agent’s approval, to purchase from the Non-Consenting
Lenders, and the Non-Consenting Lenders agree that they shall sell, all the
Non-Consenting Lenders’ Commitments for an amount equal to the principal
balances thereof and all accrued interest and fees with respect thereto through
the date of sale pursuant to Assignment and Acceptance, without premium or
discount. The Agent is irrevocably appointed as attorney-in-fact to execute any
such Assignment and Acceptance if such Lender fails to execute same within
twenty (20) days of such request of assignment. Such Lender shall be entitled to
receive, in cash, concurrently with such assignment, all amounts owed to it
under the Loan Documents, including all principal, interest and fees through the
date of assignment (but excluding any prepayment charge).

11.2 Assignments; Participations.

(a) Any Lender may, with the written consent of the Agent and Westlake, which
consent shall not be unreasonably withheld, assign and delegate to one or more
Eligible Assignees (provided that (i) no consent of the Agent or Westlake shall
be required in connection with any assignment and delegation by a Lender to an
Affiliate of such Lender, another Lender or an Approved Fund and (ii) no consent
of Westlake shall be required if an Event of Default has occurred and is
continuing at the time of such assignment) (each an “Assignee”) all, or any
ratable part of all, of the Revolving Loans, the Commitment, and the other
rights and obligations of such Lender hereunder, in a minimum amount of
$10,000,000, or, if less, all of such Lender’s Commitment (provided that, unless
an assignor Lender has assigned and delegated all of its Loans and Commitment,
no such assignment and/or delegation shall be permitted unless, after giving
effect thereto, such assignor Lender retains a Commitment in a minimum amount of
$10,000,000); provided, however, that the Borrowers and the Agent may continue
to deal solely and directly with such Lender in connection with the interest so
assigned to an Assignee until (i) written notice of such assignment, together
with payment instructions, addresses and related information with respect to the
Assignee, shall have been given to the Borrowers and the Agent

 

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by such Lender and the Assignee; (ii) such Lender and its Assignee shall have
delivered to the Borrowers and the Agent an Assignment and Acceptance in the
form of Exhibit F (“Assignment and Acceptance”) together with any note or notes,
if any, subject to such assignment, and (iii) the assignor Lender or Assignee
has paid to the Agent a processing fee in the amount of $3,500. The Borrowers
agree to promptly execute and deliver new promissory notes and replacement
promissory notes if requested by an Assignee or assignor Lender to evidence
assignments of the Revolving Loans and Commitments in accordance herewith.

(b) From and after the date that the Agent notifies the assignor Lender that it
has received an executed Assignment and Acceptance (and consent of the Agent
thereto, if required) and payment of the above-referenced processing fee,
(i) the Assignee thereunder shall be a party hereto and, to the extent that
rights and obligations, including, but not limited to, the obligation to
participate in Letters of Credit and Credit Support have been assigned to it
pursuant to such Assignment and Acceptance, shall have the rights and
obligations of a Lender under the Loan Documents (except for such rights and
obligations not available to such assignee by express terms of this Agreement),
and (ii) the assignor Lender shall, to the extent that rights and obligations
hereunder and under the other Loan Documents have been assigned by it pursuant
to such Assignment and Acceptance, relinquish its rights and be released from
its obligations under this Agreement (and in the case of an Assignment and
Acceptance covering all or the remaining portion of an assigning Lender’s rights
and obligations under this Agreement, such Lender shall cease to be a party
hereto).

(c) By executing and delivering an Assignment and Acceptance, the assigning
Lender thereunder and the Assignee thereunder confirm to and agree with each
other and the other parties hereto as follows: (i) other than as provided in
such Assignment and Acceptance, such assigning Lender makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties, or representations made in or in connection with this Agreement or
the execution, legality, validity, enforceability, genuineness, sufficiency, or
value of this Agreement or any other Loan Document furnished pursuant hereto or
the attachment, perfection, or priority of any Lien granted by any Loan Party to
the Agent or any Lender in the Collateral; (ii) such assigning Lender makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of any Loan Party or the performance or observance by any
Loan Party of any of its obligations under this Agreement or any other Loan
Document furnished pursuant hereto; (iii) such Assignee confirms that it has
received a copy of this Agreement, together with such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into such Assignment and Acceptance; (iv) such Assignee will,
independently (without reliance upon the Agent, such assigning Lender, or any
other 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 this Agreement; (v) such Assignee appoints and
authorizes the Agent to take such action as agent on its behalf and to exercise
such powers under this Agreement as are delegated to the Agent by the terms
hereof, together with such powers, including the discretionary rights and
incidental power, as are reasonably incidental thereto; and (vi) such Assignee
agrees that it will perform in accordance with their terms all of the
obligations which by the terms of this Agreement are required to be performed by
it as a Lender.

(d) Immediately upon satisfaction of the requirements of Section 11.2(a), this
Agreement shall be deemed to be amended to the extent, but only to the extent,
necessary to reflect the addition of the Assignee and the resulting adjustment
of the Commitments arising therefrom. The Commitment allocated to each Assignee
shall reduce such Commitments of the assigning Lender pro tanto.

 

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(e) Any Lender may at any time sell to one or more commercial banks, financial
institutions, or other Persons not Affiliates of any Borrower (a “Participant”)
participating interests in any Loans, the Commitment of that Lender and the
other interests of that Lender (the “Originating Lender”) hereunder and under
the other Loan Documents; provided, however, that (i) the Originating Lender’s
obligations under this Agreement shall remain unchanged; (ii) the Originating
Lender shall remain solely responsible for the performance of such obligations;
(iii) the Borrowers and the Agent shall continue to deal solely and directly
with the Originating Lender in connection with the Originating Lender’s rights
and obligations under this Agreement and the other Loan Documents; and (iv) no
Lender shall transfer or grant any participating interest under which the
Participant has rights to approve any amendment to, or any consent or waiver
with respect to, this Agreement or any other Loan Document, except the matters
set forth in Section 11.1(a)(i), (ii), and (iii), and all amounts payable by the
Loan Parties hereunder shall be determined as if such Lender had not sold such
participation; except that, if amounts outstanding under this Agreement are due
and unpaid, or shall have become due and payable upon the occurrence of an Event
of Default, each Participant shall be deemed to have the right of set off in
respect of its participating interest in amounts owing under this Agreement to
the same extent and subject to the same limitation as if the amount of its
participating interest were owing directly to it as a Lender under this
Agreement.

(f) If at any time any Lender which has issued any Letters of Credit which
remain outstanding, assigns all of its Commitment, it shall retain all the
rights, powers, privileges, and duties of a Letter of Credit Issuer hereunder
with respect to all Letters of Credit outstanding as of the effective date of
its assignment of its Commitment and all Letter-of Credit Rights with respect
thereto (including the right to require the Lenders to make Base Rate Loans
pursuant to Section 1.3). In the event any other Lender issues any Letter of
Credit in substitution for any outstanding Letter of Credit issued by any Lender
which ceases to be a Lender hereunder, the successor Letter of Credit Issuer
shall succeed to the rights and obligations of the original Letter of Credit
Issuer.

(g) Notwithstanding any other provision in this Agreement, any Lender may at any
time create a security interest in, or pledge, all or any portion of its rights
under and interest in this Agreement in favor of any Federal Reserve Bank in
accordance with Regulation A of the FRB or U.S. Treasury Regulation 31 CFR
§203.14, and such Federal Reserve Bank may enforce such pledge or security
interest in any manner permitted under applicable law.

(h) No assignment or participation may be made to a Borrower, Affiliate of a
Borrower, Defaulting Lender or natural person. In connection with any assignment
by a Defaulting Lender, such assignment shall be effective only upon payment by
the Eligible Assignee or Defaulting Lender to the Agent of an aggregate amount
sufficient, upon distribution (through direct payment, purchases of
participations or other compensating actions as the Agent deems appropriate),
(a) to satisfy all funding and payment liabilities then owing by the Defaulting
Lender hereunder, and (b) to acquire its Pro Rata Share of all Revolving Loans
and Letter of Credit Obligations. If an assignment by a Defaulting Lender shall
become effective under applicable Requirement of Law for any reason without
compliance with the foregoing sentence, then the assignee shall be deemed a
Defaulting Lender for all purposes until such compliance occurs.

 

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ARTICLE 12.

THE AGENT

12.1 Appointment and Authorization. Each Lender hereby designates and appoints
the Bank as its Agent under this Agreement and the other Loan Documents and each
Lender hereby irrevocably authorizes the Agent to take such action on its behalf
under the provisions of this Agreement and each other Loan Document and to
exercise such powers and perform such duties as are expressly delegated to it by
the terms of this Agreement or any other Loan Document, together with such
powers as are reasonably incidental thereto. The Agent agrees to act as such on
the express conditions contained in this Article 12. The provisions of this
Article 12 are solely for the benefit of the Agent and the Lenders and no
Borrower shall have any rights as a third party beneficiary of any of the
provisions contained herein. Notwithstanding any provision to the contrary
contained elsewhere in this Agreement or in any other Loan Document, the Agent
shall not have any duties or responsibilities, except those expressly set forth
herein, nor shall the Agent have or be deemed to have any fiduciary relationship
with any Lender, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or any other Loan
Document or otherwise exist against the Agent. Without limiting the generality
of the foregoing sentence, the use of the term “agent” in this Agreement with
reference to the Agent is not intended to connote any fiduciary or other implied
(or express) obligations arising under agency doctrine of any applicable law.
Instead, such term is used merely as a matter of market custom, and is intended
to create or reflect only an administrative relationship between independent
contracting parties. Except as expressly otherwise provided in this Agreement,
the Agent shall have and may use its sole discretion with respect to exercising
or refraining from exercising any discretionary rights or taking or refraining
from taking any actions which the Agent is expressly entitled to take or assert
under this Agreement and the other Loan Documents, including (a) the
determination of the applicability of ineligibility criteria with respect to the
calculation of the Borrowing Base, (b) the making of Agent Advances pursuant to
Section 1.2(i), and (c) the exercise of remedies pursuant to Section 9.2, and
any action so taken or not taken shall be deemed consented to by the Lenders.

12.2 Delegation of Duties. The Agent may execute any of its duties under this
Agreement or any other Loan Document by or through agents, employees, or
attorneys in fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. The Agent shall not be responsible for the
negligence or misconduct of any agent or attorney in fact that it selects as
long as such selection was made without gross negligence or willful misconduct.

12.3 Liability of Agent. None of the Agent Related Persons shall (a) be liable
for any action taken or omitted to be taken by any of them under or in
connection with this Agreement or any other Loan Document or the transactions
contemplated hereby (except for its own gross negligence or willful misconduct),
or (b) be responsible in any manner to any of the Lenders for any recital,
statement, representation, or warranty made by any Borrower, any Affiliate of
any Borrower, or any officer thereof, contained in this Agreement or in any
other Loan Document, or in any certificate, report, statement or other document
referred to or provided for in, or received by the Agent under or in connection
with, this Agreement or any other Loan Document, or the validity, effectiveness,
genuineness, enforceability, or sufficiency of this Agreement or any other Loan
Document, or for any failure of any Borrower or any other party to any Loan
Document to perform its obligations hereunder or thereunder. No Agent Related
Person shall be under any obligation to any Lender to ascertain or to inquire as
to the observance or performance of any of the agreements contained in, or
conditions of, this Agreement or any other Loan Document, or to inspect the
properties, books, or records of any Borrower or any Affiliates of any Borrower.

12.4 Reliance by Agent. The Agent shall be entitled to rely, and shall be fully
protected in relying, upon any writing, resolution, notice, consent,
certificate, affidavit, letter, telegram, facsimile,

 

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telex or telephone message, statement or other document, or conversation
believed by it to be genuine and correct and to have been signed, sent, or made
by the proper Person or Persons, and upon advice and statements of legal counsel
(including counsel to any Borrower), independent accountants and other experts
selected by the Agent. The Agent shall be fully justified in failing or refusing
to take any action under this Agreement or any other Loan Document unless it
shall first receive such advice or concurrence of the Required Lenders as it
deems appropriate and, if it so requests, it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any such action. The
Agent shall in all cases be fully protected in acting, or in refraining from
acting, under this Agreement or any other Loan Document in accordance with a
request or consent of the Required Lenders (or all Lenders if so required by
Section 11.1) and such request and any action taken or failure to act pursuant
thereto shall be binding upon all of the Lenders.

12.5 Notice of Default. The Agent shall not be deemed to have knowledge or
notice of the occurrence of any Default or Event of Default, unless the Agent
shall have received written notice from a Lender or the Borrowers referring to
this Agreement, describing such Default or Event of Default and stating that
such notice is a “notice of default.” The Agent will notify the Lenders of its
receipt of any such notice. The Agent shall take such action with respect to
such Default or Event of Default as may be requested by the Required Lenders in
accordance with Section 9; provided, however, that unless and until the Agent
has received any such request, the Agent may (but shall not be obligated to)
take such action, or refrain from taking such action, with respect to such
Default or Event of Default as it shall deem advisable.

12.6 Credit Decision. Each Lender acknowledges that none of the Agent Related
Persons has made any representation or warranty to it, and that no act by the
Agent hereinafter taken, including any review of the affairs of the Borrowers
and their Affiliates, shall be deemed to constitute any representation or
warranty by any Agent-Related Person to any Lender. Each Lender represents to
the Agent that it has, independently (without reliance upon any Agent-Related
Person and based on such documents and information as it has deemed
appropriate), made its own appraisal of and investigation into the business,
prospects, operations, property, financial and other condition, and
creditworthiness of the Borrowers and their Affiliates, and all applicable bank
regulatory laws relating to the transactions contemplated hereby, and made its
own decision to enter into this Agreement and to extend credit to the Borrowers.
Each Lender also represents that it will, independently (without reliance upon
any Agent-Related Person and based on such documents and information as it shall
deem appropriate at the time), continue to make its own credit analysis,
appraisals, and decisions in taking or not taking action under this Agreement
and the other Loan Documents, and to make such investigations as it deems
necessary to inform itself as to the business, prospects, operations, property,
financial and other condition, and creditworthiness of the Borrowers. Except for
notices, reports, and other documents expressly herein required to be furnished
to the Lenders by the Agent, the Agent shall not have any duty or responsibility
to provide any Lender with any credit or other information concerning the
business, prospects, operations, property, financial and other condition, or
creditworthiness of the Borrowers which may come into the possession of any of
the Agent Related Persons.

12.7 Indemnification. Whether or not the transactions contemplated hereby are
consummated, the Lenders shall indemnify upon demand the Agent Related Persons
(to the extent not reimbursed by or on behalf of the Borrowers and without
limiting the obligation of the Borrowers to do so), in accordance with their Pro
Rata Shares, from and against any and all Indemnified Liabilities as such term
is defined in Section 13.11; provided, however, that no Lender shall be liable
for the payment to the Agent Related Persons of any portion of such Indemnified
Liabilities resulting solely from such Person’s gross negligence or willful
misconduct. Without limitation of the foregoing, each Lender shall reimburse the
Agent upon demand for its Pro Rata Share of any costs or out of pocket expenses
(including Attorney Costs) incurred by the Agent in connection with the
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modification, amendment, or enforcement (whether through negotiations, legal
proceedings, or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement, any other Loan Document, or any document
contemplated by or referred to herein, to the extent that the Agent is not
reimbursed for such expenses by or on behalf of the Borrowers. The undertaking
in this Section 12.7 shall survive the payment of all Obligations hereunder and
the resignation or replacement of the Agent.

12.8 Agent in Individual Capacity. The Bank and its Affiliates may make loans
to, issue letters of credit for the account of, accept deposits from, acquire
Capital Stock in and generally engage in any kind of banking, trust, financial
advisory, underwriting, or other business with the Borrowers and their
Affiliates as though the Bank were not the Agent hereunder and without notice to
or consent of the Lenders. The Bank or its Affiliates may receive information
regarding the Borrowers, their Affiliates and Account Debtors (including
information that may be subject to confidentiality obligations in favor of the
Borrowers, Affiliates, or Account Debtors) and acknowledge that the Agent and
the Bank shall be under no obligation to provide such information to them. With
respect to its Revolving Loans, the Bank shall have the same rights and powers
under this Agreement as any other Lender and may exercise the same as though it
were not the Agent, and the terms “Lender” and “Lenders” include the Bank in its
individual capacity.

12.9 Successor Agent. The Agent may resign as Agent upon at least thirty
(30) days prior notice to the Lenders and the Borrowers, such resignation to be
effective upon the acceptance of a successor agent to its appointment as Agent.
In the event the Bank sells all of its Commitment and Revolving Loans as part of
a sale, transfer or other disposition by the Bank of substantially all of its
loan portfolio, the Bank shall resign as Agent and such purchaser or transferee
shall become the successor Agent hereunder. Subject to the foregoing, if the
Agent resigns under this Agreement, the Required Lenders shall appoint from
among the Lenders a successor agent for the Lenders. If no successor agent is
appointed prior to the effective date of the resignation of the Agent, the Agent
may appoint, after consulting with the Lenders and Westlake, a successor agent
from among the Lenders or, if no Lender accepts such role, the Agent may appoint
Required Lenders as successor Agent. Upon the acceptance of its appointment as
successor agent hereunder, or upon appointment of Required Lenders as successor
Agent, (a) such successor agent shall succeed to all the rights, powers, and
duties of the retiring Agent, (b) the term “Agent” shall mean such successor
agent, (c) the retiring Agent’s appointment, powers, and duties as Agent shall
be terminated. After any retiring Agent’s resignation hereunder as Agent, the
provisions of this Article 12 shall continue to inure to its benefit as to any
actions taken or omitted to be taken by it while it was Agent under this
Agreement.

12.10 Collateral Matters.

(a) The Lenders hereby irrevocably authorize the Agent, at its option and in its
sole discretion, to release any Agent’s Liens upon any Collateral (i) upon the
termination of the Commitments and Full Payment of the Obligations (other than
Bank Products that the applicable Lender chooses not to terminate and indemnity
obligations that survive the termination of this Agreement and are not due and
payable at such termination); (ii) constituting property being sold or disposed
of if the Borrowers certify to the Agent that the sale or disposition is made in
compliance with Section 7.9 (and the Agent may rely conclusively on any such
certificate, without further inquiry); (iii) constituting property that is not
Collateral in which the Loan Parties owned no interest at the time the Lien was
granted or at any time thereafter; or (iv) constituting property leased to the
Loan Parties under a lease which has expired or been terminated in a transaction
permitted under this Agreement. Except as provided above, the Agent will not
release any of the Agent’s Liens without the prior written authorization of the
Lenders; provided that the Agent may, in its discretion, release the Agent’s
Liens on Collateral valued in the aggregate not in excess of $5,000,000 during
each Fiscal Year without the prior written authorization of the

 

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Lenders and the Agent may release the Agent’s Liens on Collateral valued in the
aggregate not in excess of $10,000,000 during each Fiscal Year with the prior
written authorization of Required Lenders. Upon request by the Agent or the
Borrowers at any time, the Lenders will confirm in writing the Agent’s authority
to release any Agent’s Liens upon particular types or items of Collateral
pursuant to this Section 12.10.

(b) Upon receipt by the Agent of any authorization required pursuant to
Section 12.10(a) from the Lenders of the Agent’s authority to release Agent’s
Liens upon particular types or items of Collateral, and upon at least five
(5) Business Days’ prior written request by the Borrowers, the Agent shall (and
is hereby irrevocably authorized by the Lenders to) execute such documents as
may be necessary to evidence the release of the Agent’s Liens upon such
Collateral; provided, however, that (i) the Agent shall not be required to
execute any such document on terms which, in the Agent’s opinion, would expose
the Agent to liability or create any obligation or entail any consequence other
than the release of such Liens without recourse or warranty, and (ii) such
release shall not in any manner discharge, affect or impair the Obligations or
any Liens (other than those expressly being released) upon (or obligations of
any Loan Party in respect of) all interests retained by any Loan Party,
including the proceeds of any sale, all of which shall continue to constitute
part of the Collateral.

(c) The Agent shall have no obligation whatsoever to any of the Lenders to
assure that the Collateral exists or is owned by any Loan Party or is cared for,
protected, or insured or has been encumbered, or that the Agent’s Liens have
been properly or sufficiently or lawfully created, perfected, protected, or
enforced or are entitled to any particular priority, or to exercise at all or in
any particular manner or under any duty of care, disclosure, or fidelity, or to
continue exercising, any of the rights, authorities, and powers granted or
available to the Agent pursuant to any of the Loan Documents, it being
understood and agreed that in respect of the Collateral, or any act, omission,
or event related thereto, the Agent may act in any manner it may deem
appropriate, in its sole discretion given the Agent’s own interest in the
Collateral in its capacity as one of the Lenders and that the Agent shall have
no other duty or liability whatsoever to any Lender as to any of the foregoing.

12.11 Restrictions on Actions by Lenders; Sharing of Payments.

(a) Each of the Lenders agrees that it shall not, unless specifically requested
to do so by the Agent, take or cause to be taken any action to enforce its
rights under this Agreement or against any Loan Party, including the
commencement of any legal or equitable proceedings, to foreclose any Lien on, or
otherwise enforce any security interest in, any of the Collateral.

(b) If at any time or times any Lender shall receive (i) by payment,
foreclosure, setoff, or otherwise, any proceeds of Collateral or any payments
with respect to the Obligations of any Loan Party to such Lender arising under,
or relating to, this Agreement or the other Loan Documents, except for any such
proceeds or payments received by such Lender from the Agent pursuant to the
terms of this Agreement, or (ii) payments from the Agent in excess of such
Lender’s ratable portion of all such distributions by the Agent, such Lender
shall promptly (1) turn the same over to the Agent, in kind, and with such
endorsements as may be required to negotiate the same to the Agent, or in same
day funds, as applicable, for the account of all of the Lenders and for
application to the Obligations in accordance with the applicable provisions of
this Agreement, or (2) purchase, without recourse or warranty, an undivided
interest and participation in the Obligations owed to the other Lenders so that
such excess payment received shall be applied ratably as among the Lenders in
accordance with their Pro Rata Shares; provided, however, that if all or part of
such excess payment received by the purchasing party is thereafter

 

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recovered from it, those purchases of participations shall be rescinded in whole
or in part, as applicable, and the applicable portion of the purchase price paid
therefor shall be returned to such purchasing party, but without interest except
to the extent that such purchasing party is required to pay interest in
connection with the recovery of the excess payment. Notwithstanding the
foregoing, if a Defaulting Lender obtains a payment or reduction of any
Obligation, it shall immediately turn over the amount thereof to the Agent for
application under Section 12.14(e) and it shall provide a written statement to
the Agent describing the Obligation affected by such payment or reduction.

12.12 Agency for Perfection. Each Lender hereby appoints each other Lender as
agent for the purpose of perfecting the Lenders’ security interest in assets
which, in accordance with Article 9 of the UCC can be perfected only by
possession or control. Should any Lender (other than the Agent) obtain
possession or control of any such Collateral, such Lender shall notify the Agent
thereof, and, promptly upon the Agent’s request therefor shall deliver such
Collateral or control thereof to the Agent or in accordance with the Agent’s
instructions.

12.13 Payments by Agent to Lenders. All payments to be made by the Agent to the
Lenders shall be made by bank wire transfer or internal transfer of immediately
available funds to each Lender pursuant to wire transfer instructions delivered
in writing to the Agent on or prior to the Closing Date (or if such Lender is an
Assignee, on the applicable Assignment and Acceptance), or pursuant to such
other wire transfer instructions as each party may designate for itself by
written notice to the Agent. Concurrently with each such payment, the Agent
shall identify whether such payment (or any portion thereof) represents
principal, premium, or interest on the Revolving Loans or otherwise. Unless the
Agent receives notice from the Borrowers prior to the date on which any payment
is due to the Lenders that the Borrowers will not make such payment in full as
and when required, the Agent may assume that the Borrowers have made such
payment in full to the Agent on such date in immediately available funds and the
Agent may (but shall not be so required), in reliance upon such assumption,
distribute to each Lender on such due date an amount equal to the amount then
due such Lender. If and to the extent the Borrowers have not made such payment
in full to the Agent, each Lender shall repay to the Agent on demand such amount
distributed to such Lender, together with interest thereon at the Federal Funds
Rate for each day from the date such amount is distributed to such Lender until
the date repaid.

12.14 Settlement.

(a) Each Lender’s funded portion of the Revolving Loans is intended by the
Lenders to be equal at all times to such Lender’s Pro Rata Share of the
outstanding Revolving Loans. Notwithstanding such agreement, the Agent, the
Bank, and the other Lenders agree (which agreement shall not be for the benefit
of or enforceable by any Borrower) that in order to facilitate the
administration of this Agreement and the other Loan Documents, settlement among
them as to the Revolving Loans, the Non-Ratable Loans and the Agent Advances
shall take place on a periodic basis in accordance with the following
provisions:

(i) The Agent shall request settlement (“Settlement”) with the Lenders on at
least a weekly basis, or on a more frequent basis at the Agent’s election,
(A) on behalf of the Bank, with respect to each outstanding Non-Ratable Loan,
(B) for itself, with respect to each Agent Advance, and (C) with respect to
collections received, in each case, by notifying the Lenders of such requested
Settlement by telecopy, telephone or other similar form of transmission, of such
requested Settlement, no later than 1:30 p.m. (Houston, Texas time) on the date
of such requested Settlement (the “Settlement Date”). Each Lender (other than
the Bank, in the case of Non-Ratable Loans and the Agent in the case of Agent
Advances) shall transfer the amount of such Lender’s Pro Rata Share of the

 

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outstanding principal amount of the Non-Ratable Loans and Agent Advances with
respect to each Settlement to the Agent, to Agent’s account, not later than 3:30
p.m. (Houston, Texas time), on the Settlement Date applicable thereto.
Settlements may occur during the continuation of a Default or an Event of
Default and whether or not the applicable conditions precedent set forth in
Article 8 have then been satisfied. Such amounts made available to the Agent
shall be applied against the amounts of the applicable Non-Ratable Loan or Agent
Advance and, together with the portion of such Non-Ratable Loan or Agent Advance
representing the Bank’s Pro Rata Share thereof, shall constitute Revolving Loans
of such Lenders. If any such amount is not transferred to the Agent by any
Lender on the Settlement Date applicable thereto, the Agent shall be entitled to
recover such amount on demand from such Lender together with interest thereon at
the Federal Funds Rate for the first three (3) days from and after the
Settlement Date and thereafter at the Interest Rate then applicable to the
Revolving Loans (A) on behalf of the Bank, with respect to each outstanding
Non-Ratable Loan, and (B) for itself, with respect to each Agent Advance. If any
settlement amount is not transferred to the Agent by any Lender on the Business
Day after demand, the Agent will notify the Borrowers of such Lender’s failure
to transfer and, upon demand by the Agent, the Borrowers shall pay such amount
to the Agent, together with interest thereon for each day elapsed since the date
of the applicable advance, at a rate per annum equal to the Interest Rate
applicable at the time to the Revolving Loans comprising that particular
advance.

(ii) Notwithstanding the foregoing, not more than one (1) Business Day after
demand is made by the Agent (whether before or after the occurrence of a Default
or an Event of Default and regardless of whether the Agent has requested a
Settlement with respect to a Non-Ratable Loan or Agent Advance), each other
Lender (A) shall irrevocably and unconditionally purchase and receive from the
Bank or the Agent, as applicable, without recourse or warranty, an undivided
interest and participation in such Non-Ratable Loan or Agent Advance equal to
such Lender’s Pro Rata Share of such Non-Ratable Loan or Agent Advance and
(B) if Settlement has not previously occurred with respect to such Non-Ratable
Loans or Agent Advances, upon demand by Bank or Agent, as applicable, shall pay
to Bank or Agent, as applicable, as the purchase price of such participation an
amount equal to one-hundred percent (100%) of such Lender’s Pro Rata Share of
such Non-Ratable Loans or Agent Advances. If such amount is not in fact made
available to the Agent by any Lender, the Agent shall be entitled to recover
such amount on demand from such Lender together with interest thereon at the
Federal Funds Rate for the first three (3) days from and after such demand and
thereafter at the Interest Rate then applicable to Base Rate Loans.

(iii) From and after the date, if any, on which any Lender purchases an
undivided interest and participation in any Non-Ratable Loan or Agent Advance
pursuant to clause (ii) above, the Agent shall promptly distribute to such
Lender, such Lender’s Pro Rata Share of all payments of principal and interest
and all proceeds of Collateral received by the Agent in respect of such
Non-Ratable Loan or Agent Advance.

(iv) Between Settlement Dates, the Agent, to the extent no Agent Advances are
outstanding, may pay over to the Bank any payments received by the Agent, which
in accordance with the terms of this Agreement would be applied to the reduction
of the Revolving Loans, for application to the Bank’s Revolving Loans including
Non-Ratable Loans. If, as of any Settlement Date, collections received since the
then immediately preceding Settlement Date have been applied to the Bank’s
Revolving Loans (other than

 

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to Non-Ratable Loans or Agent Advances in which such Lender has not yet funded
its purchase of a participation pursuant to clause (ii) above), as provided for
in the previous sentence, the Bank shall pay to the Agent for the accounts of
the Lenders, to be applied to the outstanding Revolving Loans of such Lenders,
an amount such that each Lender shall, upon receipt of such amount, have, as of
such Settlement Date, its Pro Rata Share of the Revolving Loans. During the
period between Settlement Dates, the Bank with respect to Non-Ratable Loans, the
Agent with respect to Agent Advances, and each Lender with respect to the
Revolving Loans other than Non-Ratable Loans and Agent Advances, shall be
entitled to interest at the applicable rate or rates payable under this
Agreement on the actual average daily amount of funds employed by the Bank, the
Agent, and the other Lenders, respectively.

(v) Unless the Agent has received written notice from a Lender to the contrary,
the Agent may assume that the applicable conditions precedent set forth in
Article 8 have been satisfied and the requested Borrowing will not exceed
Availability on any Funding Date for a Revolving Loan or Non-Ratable Loan.

(b) Lenders’ Failure to Perform. All Revolving Loans (other than Non-Ratable
Loans and Agent Advances) shall be made by the Lenders simultaneously and in
accordance with their Pro Rata Shares. It is understood that (i) no Lender shall
be responsible for any failure by any other Lender to perform its obligation to
make any Revolving Loans hereunder, nor shall any Commitment of any Lender be
increased or decreased as a result of any failure by any other Lender to perform
its obligation to make any Revolving Loans hereunder, (ii) no failure by any
Lender to perform its obligation to make any Revolving Loans hereunder shall
excuse any other Lender from its obligation to make any Revolving Loans
hereunder, and (iii) the obligations of each Lender hereunder shall be several,
not joint and several.

(c) Defaulting Lenders. Unless the Agent receives notice from a Lender on or
prior to the Closing Date or, with respect to any Borrowing after the Closing
Date, at least one (1) Business Day prior to the date of such Borrowing, that
such Lender will not make available as and when required hereunder to the Agent
that Lender’s Pro Rata Share of a Borrowing, the Agent may assume that each
Lender has made such amount available to the Agent in immediately available
funds on the Funding Date. Furthermore, the Agent may, in reliance upon such
assumption, make available to the Borrowers on such date a corresponding amount.
If any Lender has not transferred its full Pro Rata Share to the Agent in
immediately available funds and the Agent has transferred corresponding amount
to the Borrowers on the Business Day following such Funding Date, that Lender
shall make such amount available to the Agent, together with interest at the
Federal Funds Rate for that day. A notice by the Agent submitted to any Lender
with respect to amounts owing shall be conclusive, absent manifest error. If
each Lender’s full Pro Rata Share is transferred to the Agent as required, the
amount transferred to the Agent shall constitute that Lender’s Revolving Loan
for all purposes of this Agreement. If that amount is not transferred to the
Agent on the Business Day following the Funding Date, the Agent will notify the
Borrowers of such failure to fund and, upon demand by the Agent, the Borrowers
shall pay such amount to the Agent for the Agent’s account, together with
interest thereon for each day elapsed since the date of such Borrowing, at a
rate per annum equal to the Interest Rate applicable at the time to the
Revolving Loans comprising that particular Borrowing. The failure of any Lender
to make any Revolving Loan on any Funding Date shall not relieve any other
Lender of its obligation hereunder to make a Revolving Loan on that Funding
Date. No Lender shall be responsible for any other Lender’s failure to advance
such other Lenders’ Pro Rata Share of any Borrowing.

 

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(d) Reallocation of Pro Rata Share; Amendments. For purposes of determining
Lenders’ obligations to fund or participate in the Revolving Loans or Letters of
Credit, the Agent may exclude the Commitments and Revolving Loans of any
Defaulting Lender(s) from the calculation of Pro Rata Shares. A Defaulting
Lender shall have no right to vote on any amendment, waiver or other
modification of a Loan Document, except as provided in Section 11.1.

(e) Payments; Fees. The Agent may, in its discretion, receive and retain any
amounts payable to a Defaulting Lender under the Loan Documents, and a
Defaulting Lender shall be deemed to have assigned to the Agent such amounts
until all Obligations owing to the Agent, non-Defaulting Lenders and other
Secured Parties have been paid in full. The Agent may apply such amounts to the
Defaulting Lender’s defaulted obligations, use the funds to cash collateralize
such Lender’s Fronting Exposure, or readvance the amounts to the Borrowers
hereunder. A Lender shall not be entitled to receive any fees accruing hereunder
during the period in which it is a Defaulting Lender, and the unfunded portion
of its Commitment shall be disregarded for purposes of calculating the unused
line fee under Section 2.5. If any Letter of Credit Obligations owing to a
Defaulted Lender are reallocated to other Lenders, fees attributable to such
Letter of Credit Obligations under Section 2.6 shall be paid to such Lenders.
The Agent shall be paid all fees attributable to the Letter of Credit
Obligations that are not reallocated.

(f) Cure. The Borrowers, the Agent and the Letter of Credit Issuers may agree in
writing that a Lender is no longer a Defaulting Lender. At such time, Pro Rata
Shares shall be reallocated without exclusion of such Lender’s Commitments and
Revolving Loans, and all outstanding Revolving Loans, Letter of Credit
Obligations and other exposures hereunder shall be reallocated among the Lenders
and settled by the Agent (with appropriate payments by the reinstated Lender) in
accordance with the readjusted Pro Rata Shares. Unless expressly agreed by the
Borrowers, the Agent and the Letter of Credit Issuers, no reinstatement of a
Defaulting Lender shall constitute a waiver or release of claims against such
Lender. The failure of any Lender to fund a Revolving Loan, to make a payment in
respect of Letter of Credit Obligations or otherwise to perform its obligations
hereunder shall not relieve any other Lender of its obligations, and no Lender
shall be responsible for default by another Lender.

12.15 Concerning the Collateral and the Related Loan Documents. Each Lender
authorizes and directs the Agent to enter into the other Loan Documents, for the
ratable benefit and obligation of the Agent and the Lenders, and to amend the
Schedules to the Loan Documents without a separate amendment to this Agreement
or the other Loan Documents signed by the requisite Lenders if the underlying
transactions necessitating such amendments of the Schedules are permitted under
this Agreement or the other Loan Documents. Each Lender agrees that any action
taken by the Agent, Majority Lenders, or Required Lenders, as applicable, in
accordance with the terms of this Agreement or the other Loan Documents, and the
exercise by the Agent, the Majority Lenders, or the Required Lenders, as
applicable, of their respective powers set forth therein or herein, together
with such other powers that are reasonably incidental thereto, shall be binding
upon all of the Lenders. The Lenders acknowledge that the Revolving Loans, Agent
Advances, Non-Ratable Loans, Bank Products, and all interest, fees and expenses
hereunder constitute one Debt, secured pari passu by all of the Collateral.

12.16 Field Audit and Examination Reports; Disclaimer by Lenders. By signing
this Agreement, each Lender:

(a) is deemed to have requested that the Agent furnish such Lender, promptly
after it becomes available, a copy of each field audit or examination report
(each a “Report” and collectively, “Reports”) prepared by or on behalf of the
Agent;

 

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(b) expressly agrees and acknowledges that neither the Bank nor the Agent
(i) makes any representation or warranty as to the accuracy of any Report, or
(ii) shall be liable for any information contained in any Report;

(c) expressly agrees and acknowledges that the Reports are not comprehensive
audits or examinations, that the Agent or the Bank or other party performing any
audit or examination will inspect only specific information regarding the
Borrowers and will rely significantly upon the Borrowers’ books and records, as
well as on representations of the Borrowers’ personnel;

(d) agrees to keep all Reports confidential and strictly for its internal use,
and not to distribute except to its participants, or use any Report in any other
manner; and

(e) without limiting the generality of any other indemnification provision
contained in this Agreement, agrees: (i) to hold the Agent and any such other
Lender preparing a Report harmless from any action the indemnifying Lender may
take or conclusion the indemnifying Lender may reach or draw from any Report in
connection with any loans or other credit accommodations that the indemnifying
Lender has made or may make to the Borrowers, or the indemnifying Lender’s
participation in, or the indemnifying Lender’s purchase of, a loan or loans of
the Borrower; and (ii) to pay and protect, and indemnify, defend and hold the
Agent and any such other Lender preparing a Report harmless from and against,
the claims, actions, proceedings, damages, costs, expenses, and other amounts
(including Attorney Costs) incurred by the Agent and any such other Lender
preparing a Report as the direct or indirect result of any third parties who
might obtain all or part of any Report through the indemnifying Lender.

12.17 Relation Among Lenders. The Lenders are not partners or co-venturers, and
no Lender shall be liable for the acts or omissions of, or (except as otherwise
set forth herein in case of the Agent) authorized to act for, any other Lender.
No Lender or any Affiliate of any Lender that obtains the benefits of
Section 7.23 by virtue of the provisions hereof or of any Guaranty or Security
Agreement, shall have the right to notice of any action or to consent to, direct
or object to any action hereunder or under any other Loan Document or otherwise
in respect of the Collateral (including the release or impairment of any
Collateral) other than in its capacity as a Lender and, in such case, only to
the extent expressly provided in the Loan Documents. Notwithstanding any other
provision of this Agreement or any other Loan Document to the contrary, the
Agent shall not be required to verify the payment of, or that other satisfactory
arrangements have been made, with respect to, Obligations arising under any Bank
Product.

12.18 Co-Agents. None of the Lenders identified on the facing page or signature
pages of this Agreement as a “co-agent” or “documentation agent” (if any) shall
have any right, power, obligation, liability, responsibility or duty under this
Agreement other than those applicable to all Lenders as such. Without limiting
the foregoing, none of the Lenders so identified as a “co-agent” or
“documentation agent” (if any) shall have or be deemed to have any fiduciary
relationship with any Lender. Each Lender acknowledges that it has not relied,
and will not rely, on any of the Lenders so identified in deciding to enter into
this Agreement or in taking or not taking action hereunder.

12.19 Bank Product Providers. Each provider of the Bank Products, by delivery of
a notice to the Agent of the existence or increase of a Bank Product, agrees to
be bound by Section 7.23 and this Section 12.19. Each provider of any Bank
Product shall indemnify and hold harmless the Agent-Related Persons, to the
extent not reimbursed by the Loan Parties, against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
charges, expenses, and disbursements (including Attorney Costs) of any kind or
nature whatsoever that may be incurred by or asserted against any Agent-Related
Person in connection with such provider’s Bank Product obligations.

 

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ARTICLE 13.

MISCELLANEOUS

13.1 No Waivers; Cumulative Remedies. No failure by the Agent or any Lender to
exercise any right, remedy, or option under this Agreement or any present or
future supplement thereto, or in any other agreement between or among any
Borrower and the Agent and/or any Lender, or delay by the Agent or any Lender in
exercising the same, will operate as a waiver thereof. No waiver by the Agent or
any Lender will be effective unless it is in writing, and then only to the
extent specifically stated. No waiver by the Agent or the Lenders on any
occasion shall affect or diminish the Agent’s and each Lender’s rights
thereafter to require strict performance by the Borrowers of any provision of
this Agreement. The Agent and the Lenders may proceed directly to collect the
Obligations without any prior recourse to the Collateral. The Agent’s and each
Lender’s rights under this Agreement will be cumulative and not exclusive of any
other right or remedy which the Agent or any Lender may have.

13.2 Severability. The illegality or unenforceability of any provision of this
Agreement or any Loan Document or any instrument or agreement required hereunder
shall not in any way affect or impair the legality or enforceability of the
remaining provisions of this Agreement or any instrument or agreement required
hereunder.

13.3 Governing Law; Choice of Forum; Service of Process.

(a) The Loan Documents have been entered into pursuant to Section 5-1401 of the
New York General Obligations Law and the substantive laws of the State of New
York (except to the extent the laws of another jurisdiction govern the creation,
perfection, validity, or enforcement of Liens under the Collateral Documents),
and the applicable federal laws of the United States of America shall govern the
validity, construction, enforcement and interpretation of the Loan Documents.

(b) Each party hereto (including each Guarantor by execution of an Obligation
Guaranty), in each case for itself, its successors and assigns, hereby
(A) irrevocably submits to the nonexclusive jurisdiction of the state (pursuant
to Section 5-1402 of the New York General Obligations Law) and federal courts
located in the Borough of Manhattan in the State of New York, and agrees and
consents that service of process may be made upon it in any legal proceeding
arising out of or in connection with the Loan Documents and the Obligations by
service of process as provided by New York law, (B) irrevocably waives, to the
fullest extent permitted by law, any objection which it may now or hereafter
have to the laying of venue of any litigation arising out of or in connection
with the Loan Documents and the Obligations brought in any such court,
(C) irrevocably waives to the fullest extent permitted by law any claims that
any litigation brought in any such court has been brought in an inconvenient
forum, (D) agrees to designate and maintain an agent for service of process in
New York in connection with any such litigation and to deliver to the Agent
evidence thereof, if requested, and (E) irrevocably agrees to the fullest extent
permitted by law that any legal proceeding against any party hereto arising out
of or in connection with the Loan Documents or the Obligations shall be brought
in one of the aforementioned courts. The scope of each of the foregoing waivers
is intended to be all-encompassing of any and all disputes that may be filed in
any court and that relate to the subject matter of this transaction, including,
without limitation, contract claims, tort claims, breach of duty claims, and all
other common law and statutory claims. The Loan Parties and each other party to
the Loan Documents acknowledge that this waiver is a material inducement to the
agreement of each party hereto to enter into a business relationship, that each
has already relied on this waiver in entering into the Loan Documents, and each
will continue to rely on each of such waivers in related future dealings. The
Loan Parties and each other party to the Loan

 

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Documents warrant and represent that they have reviewed these waivers with their
legal counsel, and that they knowingly and voluntarily agree to each such waiver
following consultation with legal counsel. THE WAIVERS IN THIS SECTION 13.3 ARE
IRREVOCABLE, MEANING THAT THEY MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING,
AND THESE WAIVERS SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, SUPPLEMENTS, AND
REPLACEMENTS TO OR OF THIS OR ANY OTHER LOAN DOCUMENT. In the event of
litigation, this Agreement may be filed as a written consent to a trial by the
court. Notwithstanding the foregoing: (1) the Agent and the Lenders shall have
the right to bring any action or proceeding against any Loan Party or their
property in the courts of any other jurisdiction the Agent or the Lenders deem
necessary or appropriate in order to realize on the Collateral or other security
for the Obligations and (2) each of the parties hereto acknowledges that any
appeals from the courts described in the immediately preceding sentence may have
to be heard by a court located outside those jurisdictions.

(c) EACH BORROWER AND EACH OTHER LOAN PARTY (BY EXECUTION OF AN OBLIGATION
GUARANTY) HEREBY WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS UPON IT AND
CONSENTS THAT ALL SUCH SERVICE OF PROCESS MAY BE MADE BY REGISTERED MAIL (RETURN
RECEIPT REQUESTED) DIRECTED TO WESTLAKE AT ITS ADDRESS SET FORTH IN SECTION 13.8
AND SERVICE SO MADE SHALL BE DEEMED TO BE COMPLETED UPON THE EARLIER OF (I) TWO
(2) DAYS AFTER THE SAME SHALL HAVE BEEN SO DEPOSITED WITH A
NATIONALLY-RECOGNIZED OVERNIGHT COURIER OR (II) WHEN ACTUALLY DELIVERED TO SUCH
PERSON. NOTHING CONTAINED HEREIN SHALL AFFECT THE RIGHT OF THE AGENT OR THE
LENDERS TO SERVE LEGAL PROCESS BY ANY OTHER MANNER PERMITTED BY LAW.

13.4 WAIVER OF JURY TRIAL. EACH BORROWER AND EACH OTHER LOAN PARTY (BY EXECUTION
OF AN OBLIGATION GUARANTY). THE LENDERS, AND THE AGENT EACH IRREVOCABLY WAIVE
THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED
UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT, THE OTHER LOAN DOCUMENTS,
OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN ANY ACTION, PROCEEDING,
OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY SUCH PARTIES AGAINST ANY OTHER
SUCH PARTY OR ANY AGENT-RELATED PERSON, PARTICIPANT, OR ASSIGNEE, WHETHER WITH
RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. EACH BORROWER, THE
LENDERS, AND THE AGENT EACH AGREE THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL
BE TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, THE
PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED
BY OPERATION OF THIS SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING
WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF
THIS AGREEMENT, THE OTHER LOAN DOCUMENTS, OR ANY PROVISION HEREOF OR THEREOF.
THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS, OR
MODIFICATIONS TO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.

13.5 Survival of Representations and Warranties. All of the Borrowers’
representations and warranties contained in this Agreement shall survive the
execution, delivery, and acceptance thereof by the parties, notwithstanding any
investigation by the Agent or the Lenders or their respective agents.

13.6 Other Security and Guaranties. The Agent, may, without notice or demand and
without affecting any Borrower’s obligations hereunder, from time to time:
(a) take from any Person and

 

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hold collateral (other than the Collateral) for the payment of all or any part
of the Obligations and exchange, enforce, or release such collateral or any part
thereof; and (b) accept and hold any endorsement or guaranty of payment of all
or any part of the Obligations and release or substitute any such endorser or
guarantor, or any Person who has given any Lien in any other collateral as
security for the payment of all or any part of the Obligations, or any other
Person in any way obligated to pay all or any part of the Obligations.

13.7 Fees and Expenses. The Borrowers agree to pay to the Agent and the Arranger
(as applicable), for their respective benefits, on demand, all reasonable costs
and expenses that the Agent or the Arranger pays or incurs in connection with
the negotiation, preparation, syndication, consummation, administration,
enforcement, and termination of this Agreement or any of the other Loan
Documents, including: (a) Attorney Costs and costs and expenses of auditors,
accountants, consultants or appraisers hired by the Agent; (b) costs and
expenses (including, without duplication, attorneys’ and paralegals’ fees and
disbursements) for any amendment, supplement, waiver, consent, or subsequent
closing in connection with the Loan Documents and the transactions contemplated
thereby; (c) costs and expenses of lien searches; (d) taxes, fees, and other
charges for recording any mortgages, filing financing statements, amendments,
and continuations, and other actions to perfect, protect, and continue the
Agent’s Liens (including costs and expenses paid or incurred by the Agent in
connection with the consummation of the Agreement); (e) sums paid or incurred to
pay any amount or take any action reasonably required of any Borrower under the
Loan Documents that Borrowers fail to pay or take; (f) costs of appraisals,
inspections, and verifications of the Collateral, including travel, lodging, and
meals for inspections of the Collateral and the Loan Parties’ operations by the
Agent plus the Agent’s then customary charge for field examinations and audits
and the preparation of reports thereof (such charge is currently $1,000 per day
(or portion thereof) for each Person retained or employed by the Agent with
respect to each field examination or audit); and (g) costs and expenses of
forwarding loan proceeds, collecting checks, and other items of payment, and
establishing and maintaining Payment Accounts and lock boxes, and costs and
expenses of preserving and protecting the Collateral. In addition, the Borrowers
agree to pay costs and expenses incurred by the Agent, the Arranger, the Letter
of Credit Issuers, and the Lenders (including Attorneys’ Costs and attorneys’
fees of each Lender) to the Agent, the Arranger, the Letter of Credit Issuers,
and the Lenders, as applicable, for their respective benefit, on demand, and all
reasonable fees, expenses and disbursements incurred by the Agent, the Arranger,
the Letter of Credit Issuers, and the Lenders for any law firm retained by the
Agent, the Arranger, any Letter of Credit Issuer, or any Lender, in each case,
paid or incurred to obtain payment of the Obligations, enforce the Agent’s
Liens, sell or otherwise realize upon the Collateral, and otherwise enforce the
provisions of the Loan Documents, or to defend any claims made or threatened
against the Agent, the Arranger, any Letter of Credit Issuer, or any Lender
arising out of the transactions contemplated hereby (including preparations for
and consultations concerning any such matters). The foregoing shall not be
construed to limit any other provisions of the Loan Documents regarding costs
and expenses to be paid by the Borrowers. All of the foregoing costs and
expenses may be (in the sole discretion of the Agent) charged to the Borrowers’
Loan Account as Revolving Loans as described in Section 3.7 up to the Maximum
Revolver Amount. Except as provided in clause (d) above, this Section 13.7 shall
not apply to Taxes, which shall be covered solely by Sections 4.1 and 4.3.

 

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13.8 Notices. Except as otherwise provided herein, all notices, demands and
requests that any party is required or elects to give to any other shall be in
writing, or by a telecommunications device capable of creating a written record,
and any such notice shall become effective (a) on the earlier of (i) two
(2) days after the same shall have been so deposited with a
nationally-recognized overnight courier or (ii) when actually delivered to such
person, (b) four (4) days after it shall have been mailed by United States mail,
first class, certified or registered, with postage prepaid, or (c) in the case
of notice by such a telecommunications device, when properly transmitted, in
each case addressed to the party to be notified as follows:

If to the Agent or to the Bank:

Bank of America, N.A.

901 Main Street, 11th Floor

Dallas, Texas 75202

Attention: Portfolio Manager

Facsimile No.: 312.453.3558

with copies to:

Haynes and Boone, LLP

901 Main Street, Suite 3100

Dallas, TX 75202

Attention: Sue P. Murphy

Facsimile No.: 214.200.0565

If to the Borrowers:

Westlake Chemical Corporation

2801 Post Oak Boulevard

Houston, TX 77056

Attention: Treasurer

Facsimile No.: 713.960.9420

with copies to:

Westlake Chemical Corporation

2801 Post Oak Boulevard

Houston, TX 77056

Attention: General Counsel

Facsimile No.: 713.926.6239

or to such other address as each party may designate for itself by like notice.
Failure or delay in delivering copies of any notice, demand, request, consent,
approval, declaration or other communication to the persons designated above to
receive copies shall not adversely affect the effectiveness of such notice,
demand, request, consent, approval, declaration or other communication. All
notices and requests given to any Lender other than the Bank shall be given to
the address, telecopier number, electronic mail address or telephone number
specified in its administrative questionnaire, or such other address as such
Lender may notify the Agent in writing.

13.9 Waiver of Notices. Unless otherwise expressly provided herein, each
Borrower waives presentment, and notice of demand or dishonor and protest as to
any instrument, notice of intent to accelerate the Obligations, and notice of
acceleration of the Obligations, as well as any and all other notices to which
it might otherwise be entitled. No notice to or demand on any Borrower which the
Agent or any Lender may elect to give shall entitle any Borrower to any or
further notice or demand in the same, similar, or other circumstances.

13.10 Binding Effect. The provisions of this Agreement shall be binding upon and
inure to the benefit of the respective representatives, successors, and assigns
of the parties hereto; provided, however, that no interest herein may be
assigned by any Borrower without prior written consent of the Agent and each
Lender. The rights and benefits of the Agent and the Lenders hereunder shall, if
such Persons so agree, inure to any party acquiring any interest in the
Obligations or any part thereof.

 

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13.11 Indemnity of the Agent, the Arranger, the Letter of Credit Issuers and the
Lenders by the Borrowers.

(a) Each Borrower and each other Loan Party (by execution of an Obligation
Guaranty) agrees to defend, indemnify, and hold the Agent-Related Persons, the
Arranger, each Letter of Credit Indemnitee, each Lender and each of their
respective Affiliates, officers, directors, employees, counsel, representatives,
agents, and attorneys in fact (each, an “Indemnified Person”) harmless from and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, charges, expenses, and disbursements
(including Attorney Costs) of any kind or nature whatsoever which may at any
time (including at any time following repayment of the Revolving Loans and the
termination, resignation, or replacement of the Agent or replacement of any
Lender) be imposed on, incurred by, or asserted against any such Person in any
way relating to or arising out of this Agreement or any document contemplated by
or referred to herein, or the transactions contemplated hereby, or any action
taken or omitted by any such Person under or in connection with any of the
foregoing, including with respect to any investigation, litigation, or
proceeding (including any insolvency proceeding or appellate proceeding) related
to or arising out of this Agreement, any other Loan Document, or the Revolving
Loans or the use of the proceeds thereof, whether or not any Indemnified Person
is a party thereto (all the foregoing, collectively, the “Indemnified
Liabilities”), IN ALL CASES, WHETHER OR NOT CAUSED BY OR ARISING, IN WHOLE OR IN
PART, OUT OF THE COMPARATIVE, CONTRIBUTORY OR SOLE NEGLIGENCE OF THE INDEMNIFIED
PERSON; provided, that the Borrowers shall have no obligation hereunder to any
Indemnified Person with respect to Indemnified Liabilities to the extent
resulting from the gross negligence or willful misconduct of such Indemnified
Person. The agreements in this Section shall survive payment of all other
Obligations. This Section 13.11(a) shall not apply to Taxes, which shall be
covered solely by Sections 4.1, 4.3 and 13.7(d).

(b) Each Borrower and each other Loan Party (by execution of an Obligation
Guaranty) agrees to indemnify, defend, and hold harmless the Agent, the Letter
of Credit Indemnitees and the Lenders from any Environmental Liability, arising
directly or indirectly, in whole or in part, out of any breach of this
Agreement, including without limitation, any breach of Section 6.14 or
Section 7.7 by any Loan Party. This indemnity will apply whether the Hazardous
Material is on, under, or about any Real Estate or operations or property leased
to, or formerly owned or operated by, any Loan Party or any of their
Subsidiaries. The indemnity includes, but is not limited to, Attorneys Costs.
The indemnity extends to the Agent and the Lenders, their parents, affiliates,
subsidiaries, and all of their directors, officers, employees, agents,
successors, attorneys, and assigns. This indemnity will survive repayment of all
other Obligations. This indemnity is intended to allocate responsibility between
the Loan Parties and the Agent and the Lenders as contemplated by
Section 107(e)(1) of CERCLA and any successor federal statute, rule, or
regulations or comparable state statute, rule, or regulations.

13.12 Limitation of Liability. NO CLAIM MAY BE MADE BY ANY LOAN PARTY, ANY
LENDER, OR OTHER PERSON AGAINST THE AGENT, THE ARRANGER, ANY LENDER, OR THE
AFFILIATES, DIRECTORS, OFFICERS, EMPLOYEES, COUNSEL, REPRESENTATIVES, AGENTS, OR
ATTORNEYS-IN-FACT OF ANY OF THEM FOR ANY SPECIAL, INDIRECT, CONSEQUENTIAL, OR
PUNITIVE DAMAGES IN RESPECT OF ANY CLAIM FOR BREACH OF CONTRACT OR ANY OTHER
THEORY OF LIABILITY ARISING OUT OF OR RELATED TO THE TRANSACTIONS CONTEMPLATED
BY THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY ACT, OMISSION, OR EVENT
OCCURRING IN CONNECTION THEREWITH, AND EACH BORROWER AND EACH OTHER LOAN PARTY
(BY EXECUTION OF AN OBLIGATION GUARANTY) AND EACH LENDER HEREBY WAIVES,
RELEASES, AND AGREES NOT TO SUE UPON ANY CLAIM FOR SUCH DAMAGES, WHETHER OR NOT
ACCRUED AND WHETHER OR NOT KNOWN OR SUSPECTED TO EXIST IN ITS FAVOR.

 

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13.13 No Advisory or Fiduciary Responsibility. In connection with all aspects of
each transaction contemplated by any Loan Document, the Borrowers acknowledge
and agree that (a)(i) this credit facility and any related arranging or other
services by the Agent, any Lender, any of their Affiliates or any arranger are
arm’s-length commercial transactions between the Borrowers and such Person;
(ii) the Borrowers have consulted their own legal, accounting, regulatory and
tax advisors to the extent they have deemed appropriate; and (iii) the Borrowers
are capable of evaluating, and understand and accept, the terms, risks and
conditions of the transactions contemplated by the Loan Documents; (b) each of
the Agent, the Lenders, their Affiliates and any arranger is and has been acting
solely as a principal and, except as expressly agreed in writing by the relevant
parties, has not been, is not, and will not be acting as an advisor, agent or
fiduciary for the Borrowers, any of their Affiliates or any other Person, and
has no obligation with respect to the transactions contemplated by the Loan
Documents except as expressly set forth therein; and (c) the Agent, the Lenders,
their Affiliates and any arranger may be engaged in a broad range of
transactions that involve interests that differ from those of the Borrowers and
their Affiliates, and have no obligation to disclose any of such interests to
the Borrowers or their Affiliates. To the fullest extent permitted by applicable
Law, each Borrower hereby waives and releases any claims that it may have
against the Agent, the Lenders, their Affiliates and any arranger with respect
to any breach of agency or fiduciary duty in connection with any transaction
contemplated by a Loan Document.

13.14 Final Agreement. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE
FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF
PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE
NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES. No modification, rescission,
waiver, release, or amendment of any provision of this Agreement or any other
Loan Document shall be made, except by a written agreement signed by the
Borrowers and a duly authorized officer of each of the Agent and the requisite
Lenders.

13.15 Counterparts. This Agreement may be executed in any number of
counterparts, and by the Agent, each Lender, and each Borrower in separate
counterparts, each of which shall be an original, but all of which shall
together constitute one and the same agreement; signature pages may be detached
from multiple separate counterparts and attached to a single counterpart so that
all signature pages are physically attached to the same document.

13.16 Captions. The captions contained in this Agreement are for convenience of
reference only, are without substantive meaning and should not be construed to
modify, enlarge, or restrict any provision.

13.17 Right of Setoff. In addition to any rights and remedies of the Lenders
provided by law, if an Event of Default exists or the Revolving Loans have been
accelerated, the Agent, each Letter of Credit Issuer, each Lender, and any of
their respective Affiliates are authorized at any time and from time to time,
without prior notice to any Loan Party, any such notice being waived by each
Loan Party to the fullest extent permitted by law, to set off and apply any and
all deposits (general or special, time or demand, provisional or final) at any
time held by, and other indebtedness at any time owing by, the Agent, such
Letter of Credit Issuer, such Lender, or such Affiliate to or for the credit or
the account of any Loan Party against any and all Obligations (for the benefit
of all Lenders as provided herein), now or hereafter existing, irrespective of
whether or not the Agent, such Letter of Credit Issuer or such Lender shall have
made demand under this Agreement or any Loan Document and although such
Obligations may be contingent or unmatured. Each Letter of Credit Issuer and
each Lender agree to promptly notify the Borrowers and the Agent after any such
setoff and application made by such Letter of Credit Issuer or

 

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such Lender; provided, however, that the failure to give such notice shall not
affect the validity of such set off and application. If any Lender shall obtain
any payment or prepayment with respect to the Obligation as a result of
exercising its right under this Section 13.16 which is in excess of its share of
any such payment in accordance with the relevant rights of the Lenders under the
Loan Documents, then such Lender shall purchase from the other Lenders such
participations as shall be necessary to cause such purchasing Lender to share
the excess payment with each other Lender in accordance with the relevant rights
under the Loan Documents. If all or any portion of such excess payment is
subsequently recovered from such purchasing Lender, then the purchase shall be
rescinded and the purchase price restored to the extent of such recovery. Each
Loan Party agrees that any Lender purchasing a participation from another Lender
pursuant to this Section may, to the fullest extent permitted by law, exercise
all of its rights of payment (including the right of offset) with respect to
such participation as fully as if such Lender were the direct creditor of such
Loan Party in the amount of such participation.

13.18 Confidentiality.

(a) Each Borrower hereby consents that the Agent and each Lender may issue and
disseminate to the public general non-confidential information describing the
credit accommodation entered into pursuant to this Agreement, including the
names and addresses of the Borrowers and a general description of the business
of the Borrowers and may use the Borrowers’ name in advertising and other
promotional material.

(b) The Agent and each Lender severally agrees to take customary and reasonable
precautions and exercise due care to maintain the confidentiality of all
information identified as “confidential” or “secret” by the Borrowers and
provided to the Agent or such Lender by or on behalf of the Borrowers, under
this Agreement, or any other Loan Document, except to the extent that such
information (i) was or becomes generally available to the public other than as a
result of disclosure by the Agent or such Lender, (ii) was or becomes available
on a nonconfidential basis from a source other than the Borrowers, provided that
such source is not bound by a confidentiality agreement with the Borrowers known
to the Agent or such Lender, (iii) was in possession of a Lender prior to
disclosure made by the Borrowers, or (iv) is independently developed by any
Lender without the use or knowledge of any Confidential Information; provided,
however, that the Agent and any Lender may disclose such information (1) at the
request or pursuant to any requirement of any Governmental Authority to which
the Agent or such Lender is subject or in connection with an examination of the
Agent or such Lender by any such Governmental Authority; (2) pursuant to
subpoena or other court process; (3) when required to do so in accordance with
the provisions of any applicable Requirement of Law; (4) to the extent
reasonably required in connection with any litigation or proceeding (including,
but not limited to, any bankruptcy proceeding) to which the Agent, any Lender or
their respective Affiliates may be party; (5) to the extent reasonably required
in connection with the exercise of any remedy hereunder or under any other Loan
Document; (6) to the Agent’s or such Lender’s independent auditors, accountants,
attorneys, other professional advisors, rating agencies, insurers, insurance
brokers, and providers of credit risk protection, provided that such Persons
have been informed that such information is required to be kept confidential to
the extent required by this Section 13.18; (7) to any prospective Participant or
Assignee under any Assignment and Acceptance, actual or potential, provided that
such prospective Participant or Assignee agrees to keep such information
confidential to the same extent required of the Agent and the Lenders hereunder;
(8) as expressly permitted under the terms of any other document or agreement
regarding confidentiality to which any Borrower is party with the Agent or such
Lender, and (9) to its Affiliates; provided that such Persons have been informed
that such information is required to be kept confidential to the extent required
by this Section 13.18. Notwithstanding anything herein to the contrary, the
information subject to this Section 13.18(b) shall not include,

 

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and the Agent, each Lender, and each employee, representative, or other agent of
the Agent or any Lender may disclose to any and all persons without limitation
of any kind, the “tax treatment” and “tax structure” (in each case, within the
meaning of Treasury Regulation Section 1.6011-4) of the transactions
contemplated hereby and all materials of any kind (including opinions or other
tax analyses) that are provided to the Agent or such Lender relating to such tax
treatment and tax structure.

13.19 Conflicts with Other Loan Documents. Unless otherwise expressly provided
in this Agreement (or in another Loan Document by specific reference to the
applicable provision contained in this Agreement), if any provision contained in
this Agreement conflicts with any provision of any other Loan Document, the
provision contained in this Agreement shall govern and control.

13.20 Westlake as Agent. By executing this Agreement, each of the Borrowers
confirms to the other parties to this Agreement that Westlake shall (and has
been duly appointed by each of the Borrowers to) act as agent for the Borrowers
for all purposes of the Loan Documents, including, without limitation, taking
any action or receiving any communication on behalf of such Borrower in
connection with the Loan Documents. Each of the Lenders and the Agent shall be
entitled to deal with any Borrower through Westlake and to rely on any
instructions or other communications from Westlake on behalf of any Borrower.
None of the Lenders or the Agent shall have any responsibility to any Borrower
for dealing with the Borrowers as provided in this Section 13.20, and the
Obligation of each of the Borrowers to the Lenders shall not be affected by any
matter relating to acts or omissions of Westlake relating to the Borrowing or
otherwise as agent for the Borrowers hereunder. Notwithstanding the appointment
of Westlake as agent for the Borrowers hereunder, the Agent and the Lenders
shall in their sole discretion be entitled to deal directly with any Borrower
for all purposes of the Loan Documents.

13.21 Patriot Act Notice. The Agent and Lenders hereby notify the Borrowers that
pursuant to the requirements of the Patriot Act, the Agent and Lenders are
required to obtain, verify and record information that identifies each Borrower,
including its legal name, address, tax ID number and other information that will
allow the Agent and the Lenders to identify it in accordance with the Patriot
Act. The Agent and the Lenders will also require information regarding each
personal guarantor, if any, and may require information regarding the Borrowers’
management and owners, such as legal name, address, social security number and
date of birth.

13.22 Restatement of Existing Credit Agreement. The parties hereto agree that:
(a) the Obligations (as defined in this Agreement) represent, among other
things, the restatement, renewal, amendment, extension and modification of the
“Obligations” (as defined in the Existing Credit Agreement); (b) this Agreement
is intended to, and does hereby, restate, renew, extend, amend, modify,
supersede and replace the Existing Credit Agreement in its entirety; (c) the
Notes executed pursuant to this Agreement amend, renew, extend, modify, replace,
restate, substitute for and supersede in their entirety (but do not extinguish,
the indebtedness arising under) the promissory notes issued pursuant to the
Existing Credit Agreement, which existing promissory notes shall be returned to
the Agent promptly after the Closing Date, marked “canceled and replaced,” and,
thereafter, delivered by the Agent to the Borrowers; (d) the entering into and
performance of their respective obligations under the Loan Documents and the
transactions evidenced hereby do not constitute a novation nor shall they be
deemed to have terminated, extinguished or discharged the indebtedness under the
Existing Credit Agreement, all of which indebtedness shall continue under and be
governed by this Agreement and the other Loan Documents, except as expressly
provided otherwise herein; (e) the liens and security interests created by or
pursuant to the Existing Credit Agreement, except as specifically modified by
the Loan Documents, are ratified and confirmed as security for the Obligations,
without novation, discharge or interruption; and (f) on the Closing Date, the
Lenders shall severally purchase from each other and from any Lenders (as
defined in the Existing Credit Agreement) that are not Lenders hereunder (the
“Non-Continuing

 

73

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Lenders”), the principal indebtedness owing to the Non-Continuing Lenders under
the Existing Credit Agreement so that, after giving effect to such purchase and
to any Loans made on the Closing Date, the principal indebtedness owing under
this Agreement and participations in the Letters of Credit are held by the
Lenders in accordance with their respective Pro Rata Share, and the
Non-Continuing Lenders shall cease to be a party to the Existing Credit
Agreement and shall not be parties to this Agreement. Such purchases shall have
been deemed to have been automatically made hereunder without the necessity of
the execution and delivery of any assignment documentation, on an as-is,
where-is basis by the Non-Continuing Lenders and any Non-Continuing Lender shall
be deemed to be a third party beneficiary of this Section 13.22.

13.23 Confirmations. Each Loan Party ratifies and confirms that each Obligation
Guaranty, each Security Agreement, each Trademark Security Agreement, each
Patent Security Agreement, and the other Loan Documents (to the extent it is a
party thereto) are and remain in full force and effect in accordance with their
respective terms, as amended hereby or by the Second Amended and Restated
Security Agreement of even date herewith (“Amended and Restated Security
Agreement”). In addition, each Loan Party acknowledges, agrees, accepts, and
consents to the terms and provisions hereof and each other Loan Document as
amended hereby or by the Amended and Restated Security Agreement. Except as
expressly provided herein, or in the Amended and Restated Security Agreement,
this Agreement does not constitute a waiver or modification of any of the terms
or provisions set forth in the Loan Documents and shall not impair any right
that the Agent or Lenders may now or hereafter have under or in connection with
any Loan Document. Each Loan Party confirms, renews, regrants, and acknowledges
all Liens and security interests set forth in the Loan Documents, except as
modified by the Amended and Restated Security Agreement, continue to secure the
Obligations, and that the Obligations shall continue to be guaranteed pursuant
to each Obligation Guaranty. The Loan Parties acknowledge that certain of the
guarantors under the Existing Credit Agreement have become Borrowers hereunder.
Each such Loan Party agrees and acknowledges its joint and several liabilities
and obligations as a Borrower, including, without limitation, with respect to
any Obligations outstanding on the date hereof under the Existing Credit
Agreement.

13.24 Electronic Execution. The words “execution,” “signed,” “signature,” and
words of like import in this Agreement, any Assignment and Assumption, or in any
amendment or other modification hereof (including waivers and consents) shall be
deemed to include electronic signatures or the keeping of records in electronic
form, each of which shall be of the same legal effect, validity or
enforceability as a manually executed signature or the use of a paper-based
recordkeeping system, as the case may be, to the extent and as provided for in
any applicable law, including the Federal Electronic Signatures in Global and
National Commerce Act, the New York State Electronic Signatures and Records Act,
or any other similar state laws based on the Uniform Electronic Transactions
Act.

[Remainder of Page Intentionally Blank. Signature Page Follows.]

 

74

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  BORROWERS AND GUARANTORS:    

WESTLAKE CHEMICAL CORPORATION,

a Delaware corporation

    WESTLAKE PVC CORPORATION, a Delaware corporation     WESTLAKE VINYLS, INC.,
a Delaware corporation    

WESTLAKE LONGVIEW CORPORATION,

a Delaware corporation

   

WESTLAKE ETHYLENE PIPELINE CORPORATION,

a Delaware corporation

   

WESTLAKE SUPPLY AND TRADING COMPANY,

a Delaware corporation

    By:  

/s/ Albert Chao

      Albert Chao       President of the above Borrowers and Guarantors

 

Signature Page to Second Amended and Restated Credit Agreement

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

  NORTH AMERICAN PIPE CORPORATION,   a Delaware corporation  

WESTECH BUILDING PRODUCTS, INC.,

a Delaware corporation

  By:  

/s/ Robert F. Buesinger

    Robert F. Buesinger     President of the above Borrowers and Guarantors

 

Signature Page to Second Amended and Restated Credit Agreement

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

  WESTLAKE VINYLS COMPANY LP,   a Delaware limited partnership   By:   GVGP,
Inc., its general partner     By:  

/s/ Albert Chao

      Albert Chao       President of the general partner of the above Borrower
and Guarantor  

WESTLAKE PETROCHEMICALS LLC,

a Delaware limited liability company

 

WESTLAKE POLYMERS LLC,

a Delaware limited liability company

 

WESTLAKE STYRENE LLC,

a Delaware limited liability company

  WPT LLC, a Delaware limited liability company   By:   Westlake Chemical
Investments, Inc., its manager   By:  

/s/ Albert Chao

    Albert Chao     President of the manager of the above Borrowers and
Guarantors

 

Signature Page to Second Amended and Restated Credit Agreement

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

  GUARANTORS:    

GEISMAR HOLDINGS, INC.,

a Delaware corporation

   

WESTLAKE DEVELOPMENT CORPORATION,

a Delaware corporation

    GVGP, INC., a Delaware corporation    

WESTLAKE CHEMICAL INVESTMENTS, INC.,

a Delaware corporation

   

WESTLAKE MANAGEMENT SERVICES, INC.,

a Delaware corporation

   

WESTLAKE OLEFINS CORPORATION,

a Delaware corporation

   

WESTLAKE RESOURCES CORPORATION,

a Delaware corporation

   

WESTLAKE VINYL CORPORATION,

a Delaware corporation

   

WESTLAKE NG I CORPORATION,

a Delaware corporation

   

WESTLAKE NG IV CORPORATION,

a Delaware corporation

   

WESTLAKE NG V CORPORATION,

a Delaware corporation

    By:  

/s/ Albert Chao

      Albert Chao       President of the above Guarantors

 

Signature Page to Second Amended and Restated Credit Agreement

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

  WESTLAKE GEISMAR POWER COMPANY LLC, a Delaware limited liability company   By:
  Westlake Vinyls Company LP, its manager   By:   GVGP, Inc., its general
partner   By:  

/s/ Albert Chao

    Albert Chao     President of the general partner of the manager of the above
Guarantor   WESTLAKE PIPELINE INVESTMENTS LLC, a Delaware limited liability
company   By:   Westlake Chemical Investments, Inc., its manager   By:  

/s/ Albert Chao

    Albert Chao     President of the manager of the above Guarantor

 

Signature Page to Second Amended and Restated Credit Agreement

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

BANK OF AMERICA, N.A., as the Agent and a Lender By:  

/s/ Hance VanBeber

Name:   Hance VanBeber Title:   Senior Vice President

 

Signature Page to Second Amended and Restated Credit Agreement

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

BNP PARIBAS, as a Lender By:  

/s/ Daniel Williams

  Name:   Daniel Williams   Title:   Director By:  

/s/ Guelay Mese

  Name:   Guelay Mese   Title:   Vice President

 

Signature Page to Second Amended and Restated Credit Agreement

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

BRANCH BANKING AND TRUST COMPANY, as a Lender By:  

/s/ Elizabeth Seigler

  Name:   Elizabeth Seigler   Title:   Assistant Vice President

 

Signature Page to Second Amended and Restated Credit Agreement

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

COMERICA BANK, as a Lender By:  

/s/ Joey Powell

  Name:   Joey Powell   Title:   Vice President

 

Signature Page to Second Amended and Restated Credit Agreement

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

COMPASS BANK, as a Lender By:  

/s/ Stuart Murphy

  Name:   Stuart Murphy   Title:   Senior Vice President

 

Signature Page to Second Amended and Restated Credit Agreement

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

DEUTSCHE BANK TRUST COMPANY AMERICAS,   as a Lender   By:  

/s/ Omayra Laucella

    Name:   Omayra Laucella     Title:   Vice President   By:  

/s/ Marguerite Sutton

    Name:   Marguerite Sutton     Title:   Director  

 

Signature Page to Second Amended and Restated Credit Agreement

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

JPMORGAN CHASE BANK, N.A., as a Lender By:  

/s/ L. Devin Mock

  Name:   L. Devin Mock   Title:   Vice President

 

Signature Page to Second Amended and Restated Credit Agreement

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

MORGAN STANLEY BANK, N.A., as a Lender By:  

/s/ Sherrese Clarke

  Name:   Sherrese Clarke   Title:   Authorized Signatory

 

Signature Page to Second Amended and Restated Credit Agreement

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

PNC BANK, NATIONAL ASSOCIATION, as a Lender By:  

/s/ Jonathan Parker

  Name:   Jonathan Parker   Title:   Officer

 

Signature Page to Second Amended and Restated Credit Agreement

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

SIEMENS FINANCIAL SERVICES, INC., as a Lender By:  

/s/ Anthony Casciano

  Name:   Anthony Casciano   Title:   Senior Vice President By:  

/s/ John Finore

  Name:   John Finore   Title:   Vice President

 

Signature Page to Second Amended and Restated Credit Agreement

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

WELLS FARGO CAPITAL FINANCE, LLC, as a Lender By:  

/s/ Sarah Orlowsky

  Name:   Sarah Orlowsky   Title:   Vice President

 

Signature Page to Second Amended and Restated Credit Agreement

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

ANNEX A

to

Second Amended and Restated Credit Agreement

Definitions

Capitalized terms used in the Loan Documents shall have the following respective
meanings (unless otherwise defined therein), and all section references in the
following definitions shall refer to sections of the Agreement:

“Accounts” means all of the Loan Party’s now owned or hereafter acquired or
arising accounts, as defined in the UCC, including any rights to payment for the
sale or lease of goods or rendition of services, whether or not they have been
earned by performance.

“Account Debtor” means each Person obligated in any way on or in connection with
an Account, Chattel Paper, or General Intangibles (including a payment
intangible).

“Account Triggering Date” shall occur whenever Availability is less than (a) the
greater of (i) 12.5% of the Maximum Revolver Amount and (ii) $50,000,000 for
five (5) consecutive Business Days or (b) the greater of (i) 10% of the Maximum
Revolver Amount and (ii) $40,000,000 at any time; provided that in the event
Availability has been greater than the greater of (i) 12.5% of the Maximum
Revolver Amount and (ii) $50,000,000 at all times for thirty (30) consecutive
Business Days, then the Account Triggering Date shall be deemed to not be
continuing for purposes of this Agreement, unless a subsequent Account
Triggering Date occurs.

“ACH Transactions” means any cash management or related services including the
automatic clearing house transfer of funds by the Bank for the account of any
Borrower pursuant to agreement or overdrafts.

“Acquisition” means any transaction or series of related transactions for the
purpose of, or resulting in, directly or indirectly, (a) the acquisition by any
Loan Party of all or substantially all of the assets of a Person or of any
business or division of a Person; (b) the acquisition by any Loan Party of more
than 50% of any class of Voting Stock (or similar ownership interests) of any
Person; or (c) a merger, consolidation, amalgamation, or other combination by
any Loan Party with another Person if a Loan Party is the surviving entity,
provided that, (i) in any merger involving any Borrower, a Borrower must be the
surviving entity; and (ii) for purpose of this Agreement, any Acquisition among
Loan Parties is not an “Acquisition.”

“Additional Letter of Credit Issuer” means a Lender that is designated by the
Borrowers to issue any Letter of Credit pursuant to this Agreement; provided
that (a) such Lender agrees to issue Letters of Credit under this Agreement,
(b) such Lender is reasonably acceptable to the Agent, and (c) the Borrowers and
such Lender shall promptly provide the Agent with a copy of each Letter of
Credit issued by such Lender.

“Adjusted Net Earnings from Operations” means, with respect to any fiscal period
of Westlake, the Loan Parties’ consolidated net income after provision for
income taxes for such fiscal period, as determined in accordance with GAAP and
reported on the Financial Statements for such period, excluding any and all of
the following included in such net income: (a) non-recurring gain or loss
arising from the sale of any capital assets; (b) non-cash gain or loss arising
from any write-up or write-down in the book value of any asset; (c) earnings of
any Person, substantially all the assets of which have been acquired by any Loan
Party in any manner, to the extent realized by such other Person prior to the

 

    Annex A

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

date of acquisition; (d) earnings of any Person in which any Loan Party has an
ownership interest unless (and only to the extent) such earnings shall actually
have been received by such Loan Party in the form of cash distributions;
(e) earnings of any Person to which assets of any Loan Party shall have been
sold, transferred, or disposed of, or into which any Loan Party shall have been
merged, or which has been a party with any Loan Party to any consolidation or
other form of reorganization, prior to the date of such transaction; (f) gain or
loss arising from the acquisition of Debt or equity security of any Loan Party
or from cancellation or forgiveness of Debt; and (g) gain and non-cash loss
arising from any non-recurring transaction.

“Affiliate” means, as to any Person, any other Person which, directly or
indirectly, is in control of, is controlled by, or is under common control with,
such Person or which owns, directly or indirectly, five percent (5%) or more of
the outstanding equity interest of such Person. A Person shall be deemed to
control another Person if the controlling Person possesses, directly or
indirectly, the power to direct or cause the direction of the management and
policies of the other Person, whether through the ownership of voting
securities, by contract, or otherwise.

“Agent” means the Bank, solely in its capacity as agent for the Lenders, and any
successor agent.

“Agent Advances” has the meaning specified in Section 1.2(i).

“Agent’s Liens” means the Liens in the Collateral granted to the Agent, for the
benefit of the Lenders, Bank, and the Agent pursuant to this Agreement and the
other Loan Documents.

“Agent Related Persons” means the Agent, together with its Affiliates, and the
officers, directors, employees, counsel, representatives, trustees, agents and
attorneys-in-fact of the Agent and such Affiliates.

“Aggregate Revolver Outstandings” means, at any date of determination: the sum
of (a) the unpaid balance of Revolving Loans, (b) the aggregate amount of
Pending Revolving Loans, (c) one hundred percent (100%) of the aggregate undrawn
face amount of all outstanding Letters of Credit, and (d) the aggregate amount
of any unpaid reimbursement obligations in respect of Letters of Credit.

“Agreement” means the Second Amended and Restated Credit Agreement dated as of
September 16, 2011, by and among the Borrowers, the Agent, and the other
Lenders, as from time to time amended, modified or restated.

“Anniversary Date” means each anniversary of the Closing Date.

“Applicable Margin” means,

(a) with respect to Base Rate Loans and LIBOR Rate Loans, as set forth in the
pricing grid below; and

(b) with respect to the Unused Line Fee, 0.375% per annum.

 

  2   Annex A

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

Average Daily Availability

   Applicable Margin for
Base Rate Loans     Applicable Margin for
LIBOR Rate Loans   £ $125,000,000      0.75 %      2.25 % 
> $125,000,000 but £$ 275,000,000      0.50 %      2.00 %  > $275,000,000     
0.25 %      1.75 % 

The Applicable Margins for LIBOR Rate Loans and Base Rate Loans will be adjusted
monthly based upon the above pricing grid. The Average Daily Availability is
calculated monthly and each new Applicable Margin shall be effective as of the
first day of the subsequent month based on the Average Daily Availability with
respect to the immediately preceding month with respect to all outstanding
Obligations.

“Approved Fund” means any Fund 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.

“Arranger” means Merrill Lynch, Pierce, Fenner & Smith Incorporated and its
successors and assigns, in its capacity as sole lead arranger and sole book
manager under the Loan Documents.

“Asset Swap” means any substantially contemporaneous (and in any event occurring
within 45 days of each other) purchase and sale or exchange of any properties or
assets having a reasonably equivalent value.

“Assignee” has the meaning specified in Section 11.2(a).

“Assignment and Acceptance” has the meaning specified in Section 11.2(a).

“Attorney Costs” means and includes all reasonable fees, expenses, and
disbursements of any law firm or other counsel engaged by the Agent or the
Arranger, and the reasonably allocated costs and expenses of internal legal
services of the Agent and the Arranger.

“Availability” means, at any time (a) the lesser of (i) the Maximum Revolver
Amount or (ii) the Borrowing Base, minus (b) Reserves from time to time
established by the Agent in its reasonable credit judgment without duplication
to the Reserves deducted in the calculation of the Borrowing Base, minus (c) the
Aggregate Revolver Outstandings.

“Average Daily Availability” means, with respect to each calendar month, the
average daily Availability during such calendar month, calculated based on the
most recently delivered Borrowing Base Certificate. Each adjustment of any
reporting schedule in the Agreement based on the Average Daily Availability
shall be effective with respect to the subsequent quarter, month, or week, as
applicable.

“Bank” means Bank of America, N.A., a national banking association, or any
successor entity thereto.

“Bank Products” means any one or more of the following types of services or
facilities extended to any Loan Party or its Affiliates (including Westlake Veba
Trust) by a Lender or any Affiliate of a Lender in reliance on the Lender’s
agreement to indemnify such Affiliate: (a) credit cards; (b) ACH Transactions;
(c) cash management, including controlled disbursement services; and (d) Hedge
Agreements.

 

  3   Annex A

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

“Bank Product Reserves” means all Reserves for Bank Products or Bank Product
Termination Value which the Agent from time to time establishes for any Bank
Products then provided or outstanding; provided that, without limiting the
foregoing, (a) the Agent shall not be required to establish any Bank Product
Reserve with respect to any Bank Products provided by any Lender (or any of its
Affiliates) for which the Agent has not received notice pursuant to Section 7.23
(other than with respect to Bank Products of the Bank or any Affiliate of the
Bank), and (b) the Agent shall not be responsible for adjusting the amount of
any Bank Product Reserve from time to time without notice from the applicable
Lender (other than the Bank or any Affiliate of the Bank) to make any such
adjustment, and written acknowledgment of receipt thereof, which Agent shall
deliver promptly upon receipt of such notice.

“Bank Product Termination Value” means on any date of determination, with
respect to any Bank Product (other than under or in connection with any Bank
Product with the Bank or any Affiliate of the Bank), the amount determined by
the applicable Lender or its Affiliates, in accordance with the documentation
evidencing the applicable Bank Product, and reported to the Agent pursuant to
Section 7.23 hereof, and in the case of the Bank or its Affiliates, shall mean
with respect to Bank Products other than Hedge Agreements, the obligations of
any Loan Party thereunder from time to time, and with respect to any Hedge
Agreement, shall mean the amount determined by the Bank or any Affiliate of the
Bank, and reflected on the documentation and records of the Bank or of such
Affiliate of the Bank; provided however, that in no event shall the Bank Product
Termination Value of any Bank Product (other than any Bank Product provided by
the Bank or an Affiliate of the Bank with respect to any Bank Product which is
not a Hedge Agreement) provided by any Lender or any Affiliate of a Lender be
increased at any time that a Default or Event of Default exists, or if creating
a Reserve against such Bank Product Termination Value or the increase thereof
would cause the Obligations to exceed the Borrowing Base.

“Bankruptcy Code” means Title 11 of the United States Code (11 U.S.C. § 101 et
seq.).

“Base Rate” means, for any day, a per annum rate equal to the greatest of
(a) the Prime Rate for such day; (b) the Federal Funds Rate for such day, plus
0.50%; or (c) LIBOR Rate for a 30 day interest period as determined on such day,
plus 1.0%.

“Base Rate Loan” means, a Revolving Loan during any period in which it bears
interest based on the Base Rate.

“Beneficial Owner” has the meaning assigned to such term in Rule 13d-3 and Rule
13d-5 under the Exchange Act, except that in calculating the beneficial
ownership of any particular “person” (as that term is used in Section 13(d)(3)
of the Exchange Act), such “person” will be deemed to have beneficial ownership
of all securities that such “person” has the right to acquire by conversion or
exercise of other securities, whether such right is currently exercisable or is
exercisable only after the passage of time. The terms “Beneficially Owns” and
“Beneficially Owned” have corresponding meanings.

“Blocked Account Agreement” means an agreement among any Loan Party, the Agent,
and a Clearing Bank, in form and substance reasonably satisfactory to the Agent,
concerning the collection of payments which represent the proceeds of Accounts
or of any other Collateral of such Loan Party.

“Bond Debt” means (a) the 6 5/8% Senior Notes due 2016 in an aggregate original
principal amount of $250,000,000 issued pursuant to the First Supplemental
Indenture dated as of January 13, 2006, (b) the 6 3/4% Senior Notes due 2032 in
an aggregate original principal amount of $250,000,000 issued pursuant to the
Second Supplemental Indenture dated as of November 1, 2007, (c) the 6.50% Senior
Notes due 2029 in an aggregate original principal amount of $100,000,000 issued
pursuant to the Third Supplemental Indenture dated as of July 2, 2010, (d) the
6.50% Senior Notes due 2035 in an

 

  4   Annex A

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

aggregate original principal amount of $89,000,000 issued pursuant to the Fourth
Supplemental Indenture dated as of December 2, 2010, and (e) the 6.50% Senior
Notes due 2035 in an aggregate original principal amount of $65,000,000 issued
pursuant to the Fifth Supplemental Indenture dated as of December 2, 2010, each
issued by Westlake under that certain Indenture dated as of January 1, 2006
between Westlake and The Bank of New York Mellon Trust Company, N.A., as
trustee, and the documents and agreements evidencing and establishing such Debt,
as the same may be amended, from time to time in accordance with the terms
thereof and hereof, and including any replacements or refinancings thereof
permitted under this Agreement.

“Borrower” and “Borrowers” have the meaning specified in the preamble to this
Agreement.

“Borrower Materials” has the meaning specified in the last paragraph of
Section 5.2.

“Borrowing” means a borrowing hereunder consisting of Revolving Loans made on
the same day by the Lenders to the Borrowers or by the Bank in the case of a
Borrowing funded by Non-Ratable Loans or by the Agent in the case of a Borrowing
consisting of an Agent Advance, or the issuance of Letters of Credit hereunder.

“Borrowing Base” means, at any time, an amount equal to (a) the sum of
(i) eighty-five percent (85%) of the Net Amount of Eligible Accounts; plus
(ii) the lesser of (y) seventy percent (70%) of the value of the lower of cost
or market of Eligible Inventory or (z) eighty-five percent (85%) of the Net
Orderly Liquidation Value of all Eligible Inventory; plus (iii) one hundred
percent (100%) of Eligible Cash; minus (b) Reserves from time to time
established by the Agent in its reasonable credit judgment; provided that the
aggregate Revolving Loans advanced against Eligible Inventory shall not exceed
the Maximum Inventory Loan Amount.

“Borrowing Base Certificate” means a certificate by a Responsible Officer for
the benefit of the Borrowers, substantially in the form of Exhibit B (or another
form acceptable to the Agent) setting forth the calculation of the Borrowing
Base, including a calculation of each component thereof, all in such detail as
shall be reasonably satisfactory to the Agent. All calculations of the Borrowing
Base in connection with the preparation of any Borrowing Base Certificate shall
originally be made by the Borrowers and certified to the Agent; provided, that
the Agent shall have the right to review and adjust, in the exercise of its
reasonable credit judgment, any such calculation (a) to reflect its reasonable
estimate of declines in value of any of the Collateral described therein, and
(b) to the extent that such calculation is not in accordance with this
Agreement.

“Business Day” means (a) any day that is not a Saturday, Sunday, or a day on
which banks in Houston, Texas, New York, New York, or Charlotte, North Carolina
are required or permitted to be closed, and (b) with respect to all notices,
determinations, fundings and payments in connection with the LIBOR Rate or LIBOR
Rate Loans, any day that is a Business Day pursuant to clause (a) above and that
is also a day on which trading in Dollars is carried on by and between banks in
the London interbank market.

“Capital Adequacy Regulation” means any guideline, request, or directive of any
central bank or other Governmental Authority, or any other law, rule, or
regulation, whether or not having the force of law, in each case, regarding
capital adequacy of any bank or of any corporation controlling a bank.

“Capital Expenditures” means all payments due (whether or not paid during any
fiscal period) in respect of the cost of any fixed asset or improvement, or
replacement, substitution, or addition

 

  5   Annex A

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

thereto, which has a useful life of more than one year, including, without
limitation, those costs arising in connection with the direct or indirect
acquisition of such asset by way of increased product or service charges or in
connection with a Capital Lease.

“Capital Lease” means any lease of property by a Person which, in accordance
with GAAP, should be reflected as a capital lease on the balance sheet of such
Person.

“Capital Stock” means (a) in the case of a corporation, capital stock, (b) in
the case of an association or business entity, any and all shares, interests,
participations, rights, or other equivalents (however designated) of capital
stock, (c) in the case of a partnership, partnership interests (whether general
or limited), (d) in the case of a limited liability company, membership
interests, and (e) any other interest or participation that confers on a Person
the right to receive a share of the profits and losses of, or distributions of
assets of, the issuing Person.

“Cash Equivalents” means investments of the type described in clauses
(d) through (f), inclusive, and (n) through (s), inclusive, of the definition of
“Restricted Investment”.

“Change in Law” means the occurrence, after the date hereof, of (a) the
adoption, taking effect or phasing in of any law, rule, regulation or treaty;
(b) any change in any law, rule, regulation or treaty or in the administration,
interpretation or application thereof; or (c) the making, issuance or
application of any request, guideline, requirement or directive (whether or not
having the force of law) by any Governmental Authority; provided that
notwithstanding anything herein to the contrary, (i) the Dodd-Frank Wall Street
Reform and Consumer Protection Act and all requests, rules, guidelines or
directives thereunder or issued in connection therewith and (ii) all requests,
rules, guidelines or directives promulgated by the Bank for International
Settlements, the Basel Committee on Banking Supervision (or any successor or
similar authority) or the United States or foreign regulatory authorities, in
each case pursuant to Basel III, shall in each case be deemed to be a “Change in
Law,” regardless of the date enacted, adopted or issued.

“Change of Control” means the occurrence of any of the following: (a) the direct
or indirect sale, transfer, conveyance, or other disposition (other than by way
of merger or consolidation), in one or a series of related transactions, of all
or substantially all of the properties or assets of Westlake and its
Subsidiaries taken as a whole to any “person” (as that term is used in
Section 13(d) of the Exchange Act) other than a Principal or a Related Party of
a Principal; (b) the adoption of a plan relating to the liquidation or
dissolution of Westlake; (c) the consummation of any transaction (including,
without limitation, any merger or consolidation) the result of which is that any
“person” (as defined above), other than the Principals and their Related Parties
or a Permitted Group, becomes the Beneficial Owner, directly or indirectly, of
more than 50% of the Voting Stock of Westlake, measured by voting power rather
than number of shares, other than in any transaction that complies with clause
(d) herein; (d) Westlake consolidates with, or merges with or into, any Person,
or any Person consolidates with, or merges with or into, Westlake, in any such
event pursuant to a transaction in which any of the outstanding Voting Stock of
Westlake or such other Person is converted into or exchanged for cash,
securities, or other property, other than any such transaction where the Voting
Stock of Westlake outstanding immediately prior to such transaction is converted
into or exchanged for Voting Stock (other than Disqualified Stock) of the
surviving or transferee Person constituting a majority of the outstanding shares
of such Voting Stock of such surviving or transferee Person (immediately after
giving effect to such issuance); or (e) the first day on which a majority of the
members of the board of directors of Westlake are not Continuing Directors.

“Chattel Paper” means all of any Loan Party’s now owned or hereafter acquired
chattel paper, as defined in the UCC, including electronic chattel paper.

 

  6   Annex A

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“Clearing Bank” means the Bank or any other banking institution with whom a
Payment Account has been established pursuant to a Blocked Account Agreement.

“Closing Date” means the date of this Agreement.

“Closing Fee” has the meaning specified in Section 2.4.

“Code” means the Internal Revenue Code of 1986.

“Collateral” means, subject to the terms of the Security Agreement, (a) all of
each Loan Party’s Inventory, Accounts, Instruments, Chattel Paper, Deposit
Accounts, Documents, and Related General Intangibles; and (b) all other assets
of any Person from time to time subject to Agent’s Liens securing payment or
performance of the Obligations, but in any event excluding the Excluded Assets
(as such term is defined in the Security Agreement).

“Collateral Documents” means all Security Agreements, pledge agreements,
Copyright Security Agreements, Patent and Trademark Agreements, financing
statements, assignments of partnership interests, Obligation Guaranties, and
mortgages at any time delivered to the Agent to create or evidence Liens
securing the Obligations, together with all reaffirmations, amendments, and
modifications thereof or supplements thereto.

“Commitment” means, at any time with respect to a Lender, the principal amount
set forth beside such Lender’s name under the heading “Commitment” on
Schedule 1.2 attached to the Agreement or on the signature page of the
Assignment and Acceptance pursuant to which such Lender became a Lender
hereunder in accordance with the provisions of Section 11.2, as such Commitment
may be adjusted from time to time in accordance with the provisions of
Sections 1.2(j) or 11.2, and “Commitments” means, collectively, the aggregate
amount of the commitments of all of the Lenders.

“Contaminant” means any waste, pollutant, hazardous substance, toxic substance,
hazardous waste, special waste, petroleum or petroleum-derived substance or
waste, asbestos in any form or condition, PCBs, or any constituent of any such
substance or waste.

“Continuation/Conversion Date” means the date on which a Loan is converted into
or continued as a LIBOR Rate Loan.

“Continuing Directors” means, as of any date of determination, any member of the
board of directors of Westlake who (a) was a member of such board of directors
on the Closing Date or (b) was nominated for election or elected or appointed to
such board of directors with the approval of, or whose nomination for election
by the stockholders was approved by, a majority of the Continuing Directors who
were members of such board of directors at the time of such nomination,
appointment, or election.

“Copyright Security Agreement” means any Copyright Security Agreement, executed
and delivered by any Loan Party to the Agent, for the benefit of the Agent and
the Lenders, to evidence and perfect the Agent’s security interest in the Loan
Parties’ present and future copyrights and related licenses and rights, as
amended, restated, amended and restated, or otherwise modified from time to
time.

“Credit Support” has the meaning specified in Section 1.3(a).

“Debt” means, without duplication, all liabilities, obligations, and
indebtedness of any Loan Party to any Person, of any kind or nature, now or
hereafter owing, arising, due or payable,

 

  7   Annex A

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howsoever evidenced, created, incurred, acquired or owing, whether primary,
secondary, direct, contingent, fixed or otherwise, consisting of indebtedness
for borrowed money, the deferred purchase price of property, or preferred stock
or other equity interests that have characteristics of Debt such as, dividend
requirements (whether cash or paid in kind) or, in the case of Disqualified
Stock, mandatory redemption requirements, excluding trade payables, but
including (a) all Obligations; (b) all obligations and liabilities of any Person
secured by any Lien on any Loan Party’s property, even though such Loan Party
shall not have assumed or become liable for the payment thereof; provided,
however, that all such obligations and liabilities which are limited in recourse
to such property shall be included in Debt only to the extent of the book value
of such property as would be shown on a balance sheet of such Loan Party
prepared in accordance with GAAP; (c) all obligations or liabilities created or
arising under any Capital Lease or conditional sale or other title retention
agreement with respect to property used or acquired by any Borrower, even if the
rights and remedies of the lessor, seller or lender thereunder are limited to
repossession of such property; provided, however, that all such obligations and
liabilities which are limited in recourse to such property shall be included in
Debt only to the extent of the book value of such property as would be shown on
a balance sheet of any Loan Party prepared in accordance with GAAP; (d) all
obligations and liabilities under Guaranties of another Person of borrowed
money; and (e) the present value (discounted at the Base Rate) of lease payments
due under synthetic leases.

“Default” means any event or circumstance which, with the giving of notice, the
lapse of time, or both, would (if not cured, waived, or otherwise remedied
during such time) constitute an Event of Default.

“Default Rate” means a fluctuating per annum interest rate at all times equal to
the sum of (a) the otherwise applicable Interest Rate plus (b) two percent
(2%) per annum. Each Default Rate shall be adjusted simultaneously with any
change in the applicable Interest Rate. In addition, the Default Rate shall
result in an increase in the Letter of Credit Fee by two (2) percentage points
per annum.

“Defaulting Lender” means any Lender that, as determined by the Agent, (a) has
failed to perform any funding obligations hereunder, and such failure is not
cured within three Business Days; (b) has notified the Agent or any Borrower
that such Lender does not intend to comply with its funding obligations
hereunder or has made a public statement to the effect that it does not intend
to comply with its funding obligations hereunder or under any other credit
facility; (c) has failed, within three Business Days following request by the
Agent, to confirm in a manner satisfactory to Agent that such Lender will comply
with its funding obligations hereunder; or (d) has, or has a direct or indirect
parent company that has, become the subject of an insolvency proceeding or taken
any action in furtherance thereof; provided, however, that a Lender shall not be
a Defaulting Lender solely by virtue of a Governmental Authority’s ownership of
an equity interest in such Lender or parent company.

“Deposit Accounts” means all “deposit accounts” as such term is defined in the
UCC, now or hereafter held in the name of any Loan Party, including, without
limitation, the Payment Accounts, but excluding the Flexible Spending Account
No. 4426569503 maintained by Westlake Chemical Corporation at Bank of America,
N.A. or any substitute or replacement account of such Flexible Spending Account.

“Designated Account” has the meaning specified in Section 1.2(c).

“Designated Project Expenditures” means non-recurring (i.e., not for maintenance
purposes) project-related Capital Expenditures incurred by a Loan Party or its
Restricted Subsidiaries and funded (a) with Debt other than Revolving Loans (but
including, without duplication, principal payments with respect to such Debt) or
(b) cash on hand (other than proceeds of Revolving Loans), to the extent the
applicable Loan Party designates such project in writing to the Agent as a
“Pre-Funded Capital Project”

 

  8   Annex A

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prior to the incurrence of any Designated Project Expenditures. A Loan Party may
de-designate a Pre-Funded Capital Project, but once “de-designated,” the same
project may not be designated as a Pre-Funded Capital Project. To the extent any
Revolving Loan remains outstanding while there is a Pre-Funded Capital Project,
the Agent may establish Reserves against the estimated Designated Project
Expenditures to be incurred during the next twelve (12) months in connection
with such Pre-Funded Capital Project.

“Disqualified Stock” means any Capital Stock that, by its terms (or by the terms
of any security into which it is convertible, or for which it is exchangeable,
in each case at the option of the holder of the Capital Stock), or upon the
happening of any event, matures or is mandatorily redeemable, pursuant to a
sinking fund obligation or otherwise, or redeemable at the option of the holder
of the Capital Stock, in whole or in part, on or prior to the date that is 91
days after the Stated Termination Date. Notwithstanding the preceding sentence,
any Capital Stock that would constitute Disqualified Stock solely because the
holders of the Capital Stock have the right to require Westlake to repurchase
such Capital Stock upon the occurrence of a change of control or an asset sale
will not constitute Disqualified Stock if the terms of such Capital Stock
provide that Westlake may not repurchase or redeem any such Capital Stock
pursuant to such provisions unless such repurchase or redemption complies with
Section 7.10. The amount of Disqualified Stock deemed to be outstanding at any
time for purposes of this Agreement will be the maximum amount that Westlake and
its Restricted Subsidiaries may become obligated to pay upon the maturity of, or
pursuant to any mandatory redemption provisions of, such Disqualified Stock,
exclusive of accrued dividends.

“Distribution” means, in respect of any corporation, limited partnership, or
limited liability company: (a) the payment or making of any dividend or other
distribution of property in respect of capital stock, partnership interest, or
membership interest, as applicable (or any options or warrants for, or other
rights with respect to, such stock, partnership interest, or membership
interest, as applicable) of such corporation, limited partnership, or limited
liability company, other than distributions in capital stock, partnership
interest, or membership interest, as applicable (or any options or warrants for
such stock, partnership interest, or membership interest, as applicable) of the
same class; or (b) the redemption or other acquisition by such corporation,
limited partnership, or limited liability company of any capital stock,
partnership interest, or membership interest, as applicable (or any options or
warrants for such stock, partnership interest, or membership interest, as
applicable) of such corporation, limited partnership, or limited liability
company.

“Documents” means all documents as such term is defined in the UCC, including
bills of lading, warehouse receipts or other documents of title, now owned or
hereafter acquired by any Loan Party.

“DOL” means the United States Department of Labor or any successor department or
agency.

“Dollar” and “$” means dollars in the lawful currency of the United States.
Unless otherwise specified, all payments under this Agreement shall be made in
Dollars.

“Domestic Subsidiary” of any Person means a direct or indirect Subsidiary of
such Person that is organized or incorporated under the laws of a jurisdiction
of the United States, other than a direct or indirect Subsidiary of a Foreign
Subsidiary of such Person.

“EBITDA” means, with respect to any fiscal period of the Loan Parties, Adjusted
Net Earnings from Operations, plus, to the extent deducted in the determination
of Adjusted Net Earnings from Operations for that fiscal period, interest
expenses, interest on financed insurance premiums permitted pursuant to
Section 7.13(h), Federal, state, local and foreign income taxes, depreciation
and amortization.

 

  9   Annex A

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“Eligible Accounts” means the Accounts which the Agent in the exercise of its
reasonable commercial discretion determines to be Eligible Accounts. Without
limiting the discretion of the Agent to establish other criteria of
ineligibility (provided that the Agent shall notify Westlake of other criteria
of ineligibility five (5) days prior to the effectiveness thereof), Eligible
Accounts shall not, unless the Agent in its sole discretion elects, include any
Account:

(a) with respect to which more than ninety (90) days have elapsed since the date
of the original invoice therefor or which is more than sixty (60) days past due
(without duplication);

(b) with respect to which any of the representations, warranties, covenants, and
agreements contained in the Security Agreement are incorrect or have been
breached;

(c) with respect to which Account (or any other Account due from such Account
Debtor), in whole or in part, a check, promissory note, draft, trade acceptance
or other instrument for the payment of money has been received, presented for
payment, and returned uncollected for any reason;

(d) which represents a progress billing (as hereinafter defined) or as to which
any Loan Party has extended the time for payment without the consent of the
Agent; for the purposes hereof, “progress billing” means any invoice for goods
sold or leased or services rendered under a contract or agreement pursuant to
which the Account Debtor’s obligation to pay such invoice is conditioned upon
any Loan Party’s completion of any further performance under the contract or
agreement;

(e) with respect to which any one or more of the following events has occurred
to the Account Debtor on such Account: death or judicial declaration of
incompetency of an Account Debtor who is an individual; the filing by or against
the Account Debtor of a request or petition for liquidation, reorganization,
arrangement, adjustment of debts, adjudication as a bankrupt, winding-up, or
other relief under the bankruptcy, insolvency, or similar laws of the United
States, any state or territory thereof, or any foreign jurisdiction, now or
hereafter in effect; the making of any general assignment by the Account Debtor
for the benefit of creditors; the appointment of a receiver or trustee for the
Account Debtor or for any of the assets of the Account Debtor, including,
without limitation, the appointment of or taking possession by a “custodian,” as
defined in the Federal Bankruptcy Code; the institution by or against the
Account Debtor of any other type of insolvency proceeding (under the bankruptcy
laws of the United States or otherwise) or of any formal or informal proceeding
for the dissolution or liquidation of, settlement of claims against, or winding
up of affairs of, the Account Debtor; the sale, assignment, or transfer of all
or any material part of the assets of the Account Debtor; the nonpayment
generally by the Account Debtor of its debts as they become due; or the
cessation of the business of the Account Debtor as a going concern;

(f) if fifty percent (50%) or more of the aggregate Dollar amount of outstanding
Accounts owed at such time by the Account Debtor thereon is classified as
ineligible under clause (a) above;

(g) owed by an Account Debtor which: (i) does not maintain its chief executive
office in the United States of America or Canada; or (ii) is not organized under
the laws of the United States of America or any state thereof; or (iii) is the
government of any foreign country or

 

  10   Annex A

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sovereign state, or of any state, province, municipality, or other political
subdivision thereof, or of any department, agency, public corporation, or other
instrumentality thereof (“Foreign Account Debtors”); other than (x) such
accounts backed by letters of credit issued or confirmed by a bank reasonably
acceptable to the Agent and in form and substance acceptable to the Agent in its
sole discretion and (y) up to $10,000,000 of accounts owed by Foreign Account
Debtors, which are insured by credit insurance, provided that both such accounts
and such credit insurance are acceptable to the Agent, in its sole discretion;

(h) owed by an Account Debtor which is another Loan Party or an Affiliate or
employee of any Loan Party;

(i) except as provided in clause (k) below, with respect to which either the
perfection, enforceability, or validity of the Agent’s Liens in such Account, or
the Agent’s right or ability to obtain direct payment to the Agent of the
proceeds of such Account, is governed by any federal, state, or local statutory
requirements other than those of the UCC;

(j) owed by an Account Debtor to which any Loan Party is indebted in any way, or
which is subject to any right of setoff or recoupment by the Account Debtor,
unless the Account Debtor has entered into an agreement acceptable to the Agent
to waive setoff rights; or if the Account Debtor thereon has disputed liability
or made any claim with respect to any other Account due from such Account
Debtor; but in each such case only to the extent of such indebtedness, setoff,
recoupment, dispute, or claim, and other Accounts owing pursuant to performance
contracts which the Agent determines in its reasonable credit judgment could be
set off in the event of any Loan Party’s default thereunder;

(k) owed by the government of the United States of America, or any department,
agency, public corporation, or other instrumentality thereof, unless the Federal
Assignment of Claims Act of 1940, as amended (31 U.S.C. § 3727 et seq.), and any
other steps necessary to perfect the Agent’s Liens therein, have been complied
with to the Agent’s satisfaction with respect to such Account;

(l) owed by any state, municipality, or other political subdivision of the
United States of America, or any department, agency, public corporation, or
other instrumentality thereof and as to which the Agent determines that its Lien
therein is not or cannot be perfected;

(m) which represents a sale on a bill-and-hold, guaranteed sale, sale and
return, sale on approval, consignment, or other repurchase or return basis, a
sale on cash on delivery terms, or the remaining balances on Accounts that were
short paid by an Account Debtor and are evidenced by debit memoranda;

(n) which is evidenced by a promissory note or other instrument or by chattel
paper;

(o) if the Agent believes, in the exercise of its reasonable judgment, that the
prospect of collection of such Account is impaired or that the Account may not
be paid by reason of the Account Debtor’s financial inability to pay;

(p) with respect to which the Account Debtor is located in any state requiring
the filing of a Notice of Business Activities Report or similar report in order
to permit a Loan Party to seek judicial enforcement in such State of payment of
such Account, unless such Loan Party has qualified to do business in such state
or has filed a Notice of Business Activities Report or equivalent report for the
then-current year;

 

  11   Annex A

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(q) which arises out of a sale not made in the ordinary course of any Loan
Party’s business;

(r) with respect to which the goods giving rise to such Account have not been
shipped and delivered to and accepted by the Account Debtor or the services
giving rise to such Account have not been performed by a Loan Party, and, if
applicable, accepted by the Account Debtor, or the Account Debtor revokes its
acceptance of such goods or services;

(s) owed by an Account Debtor or a group of affiliated Account Debtors which is
obligated to one or more Loan Parties respecting Accounts the aggregate unpaid
balance of which exceeds fifteen percent (15%) of the aggregate unpaid balance
of all Accounts owed to the Loan Parties at such time by all of the Loan
Parties’ Account Debtors, but only to the extent of such excess;

(t) which is not subject to a first priority and perfected security interest in
favor of the Agent for the benefit of the Lenders, or that are subject to any
other Lien whatsoever (other than the Liens described in clause (a) of the
definition of Permitted Liens; provided that such Permitted Liens (i) are junior
in priority to the Agent’s Liens or subject to Reserves and (ii) do not impair
directly or indirectly the ability of the Agent to realize on or obtain the full
benefit of the Collateral);

(u) owed by an Account Debtor pursuant to a performance contract (including,
without limitation, any exchange contracts), which the Agent determines in its
reasonable credit judgment could be set off in the event of any Loan Party’s
default thereunder; or

(v) on and after a Default, Event of Default, or the Account Triggering Date,
with respect to which the Agent does not have control of the Payment Accounts.

If any Account at any time ceases to be an Eligible Account, then such Account
shall promptly be excluded from the calculation of Eligible Accounts.

“Eligible Assignee” means (a) a commercial bank, commercial finance company, or
other asset based lender, having total assets in excess of $1,000,000,000;
(b) any Lender listed on the signature page of this Agreement; (c) any Affiliate
of any Lender; (d) an Approved Fund; and (e) if an Event of Default has occurred
and is continuing, any Person reasonably acceptable to the Agent.

“Eligible Cash” means cash held in the account entitled “Westlake Chemical
Corporation FBO Bank of America, N.A., as Collateral Pledgee Cash Collateral
Account” maintained at the Bank, which account shall be subject to a control
agreement in form and substance satisfactory to the Agent.

“Eligible Inventory” means Inventory, valued at the lower of cost (on a
first-in, first-out basis) or market, which the Agent, in the exercise of its
reasonable commercial discretion, determines to be Eligible Inventory. Without
limiting the discretion of the Agent to establish other criteria of
ineligibility (provided that the Agent shall notify Westlake of other criteria
of ineligibility five (5) days prior to the effectiveness thereof), Eligible
Inventory shall not, unless the Agent in its sole discretion elects, include any
Inventory:

(a) that is not owned by a Loan Party;

 

  12   Annex A

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(b) that is not subject to the Agent’s Liens, which are perfected as to such
Inventory, or that are subject to any other Lien whatsoever (other than the
Liens described in clauses (a) and (d) of the definition of Permitted Liens;
provided that such Permitted Liens (i) are junior in priority to the Agent’s
Liens or subject to Reserves and (ii) do not impair directly or indirectly the
ability of the Agent to realize on or obtain the full benefit of the
Collateral);

(c) that does not consist of finished goods or raw materials;

(d) that consists of work-in-process, spare parts, scrap Inventory, additive,
compounds, regrinds, samples, prototypes, supplies, or packing and shipping
materials;

(e) that is not in good condition, is unmerchantable, is defective, or does not
meet all standards imposed by any Governmental Authority, having regulatory
authority over such goods, their use or sale;

(f) that is not currently either usable or salable, at prices approximating at
least cost, in the normal course of any Loan Party’s business, or that is slow
moving or stale;

(g) that is obsolete or returned or repossessed or used goods taken in trade;

(h) that is located outside the United States of America;

(i) that is located in a public warehouse or in possession of a bailee or in a
facility leased by any Person, provided that any Inventory that is located in a
facility leased by any Loan Party will be Eligible Inventory to the extent the
value of Inventory in such location equals or exceeds $250,000, if (x) a
reserve, acceptable to the Agent, for rents or storage charges has been
established for inventory at such location or (y) bailee letters and lien
releases or subordinations in form and substance acceptable to the Agent have
been obtained with respect to such leased location;

(j) that contains or bears any Proprietary Rights licensed to a Loan Party by
any Person, if the Agent is not satisfied that it may sell or otherwise dispose
of such Inventory in accordance with the terms of the Security Agreement and
Section 9.2 without infringing the rights of the licensor of such Proprietary
Rights or violating any contract with such licensor (and without payment of any
royalties other than any royalties due with respect to the sale or disposition
of such Inventory pursuant to the existing license agreement), and, as to which
such Loan Party has not delivered to the Agent a consent or sublicense agreement
from such licensor in form and substance acceptable to the Agent if requested;

(k) that is not reflected in the details of a current perpetual inventory
report;

(l) that is placed on consignment;

(m) that is located in third party pipelines for which (i) bailee letters and
lien releases or subordinations in form and substance acceptable to the Agent
have not been obtained or (ii) reserves acceptable to the Agent have not been
established;

(n) that is located with vendors to whom any Loan Party has any accounts payable
to the extent of such accounts payable balance;

(o) that has been capitalized on the Financial Statements of any Loan Party;

 

  13   Annex A

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(p) to the extent that it reflects intercompany profit; or

(q) that is located on customer leased tracks; or

(r) that is in transit, other than Inventory in transit from a facility of a
Loan Party to that of another Loan Party.

If any Inventory at any time ceases to be Eligible Inventory, such Inventory
shall promptly be excluded from the calculation of Eligible Inventory.

“Environmental Claims” means all claims, however asserted, by any Governmental
Authority or other Person alleging potential liability or responsibility for
violation of any Environmental Law, or for a Release or injury to the
environment.

“Environmental Compliance Reserve” means any reserve which the Agent establishes
in its reasonable discretion after prior written notice to the Borrowers from
time to time for amounts that are reasonably likely to be expended by the Loan
Parties in order for the Loan Parties and their operations and property (a) to
comply with any notice from a Governmental Authority asserting material
non-compliance with Environmental Laws, or (b) to correct any such material
non-compliance identified in a report delivered to the Agent and the Lenders
pursuant to Section 7.7.

“Environmental Laws” means all federal, state or local laws, statutes, common
law duties, rules, regulations, ordinances and codes, together with all
administrative orders, directed duties, licenses, authorizations and permits of,
and agreements with, any Governmental Authority, in each case relating to
environmental, health, safety and land use matters.

“Environmental Liability” means any obligation, liability (including, without
limitation, any strict liability), loss, fine, penalty, charge, Lien, damage,
cost, reasonable attorneys’ and expert fees, or any other expense arising under,
or resulting from a violation of any Environmental Law, the presence, Release,
or threatened Release of any Hazardous Materials, or actual or threatened
damages to natural resources.

“Environmental Lien” means a Lien in favor of any Governmental Authority for
(a) any liability under Environmental Laws, or (b) damages arising from, or
costs incurred by such Governmental Authority in response to, a Release or
threatened Release.

“Environmental Permit” means any permit, license, or other authorization from
any Governmental Authority that is required under any Environmental Law for the
lawful conduct of any business, process, or other activity.

“Equipment” means all of any Loan Party’s now owned and hereafter acquired
machinery, equipment, furniture, furnishings, fixtures, and other tangible
personal property (except Inventory), including embedded software, motor
vehicles with respect to which a certificate of title has been issued, aircraft,
dies, tools, jigs, molds, and office equipment, as well as all of such types of
property leased by any Loan Party and all of any Loan Party’s rights and
interests with respect thereto under such leases (including, without limitation,
options to purchase); together with all present and future additions and
accessions thereto, replacements therefor, component and auxiliary parts and
supplies used or to be used in connection therewith, and all substitutes for any
of the foregoing, and all manuals, drawings, instructions, warranties and rights
with respect thereto; wherever any of the foregoing is located.

 

  14   Annex A

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“Equity Issuance” means the issuance on and after the Closing Date by any Loan
Party of any shares of any class of stock, warrants, or other Capital Stock,
other than present and future shares of stock, options, or warrants issued to
employees, or directors of any Loan Party under any Loan Party’s stock option or
other benefit or compensation plans or arrangements, or stock issued upon their
exercise.

“ERISA” means the Employee Retirement Income Security Act of 1974, and
regulations promulgated thereunder.

“ERISA Affiliate” means any trade or business (whether or not incorporated)
under common control with any Loan Party within the meaning of Section 414(b) or
(c) of the Code (and Sections 414(m) and (o) of the Code for purposes of
provisions relating to Section 412 of the Code).

“ERISA Event” means (a) a Reportable Event with respect to a Pension Plan, (b) a
withdrawal by any Loan Party or any ERISA Affiliate from a Pension Plan subject
to Section 4063 of ERISA during a plan year in which it was a substantial
employer (as defined in Section 4001(a)(2) of ERISA) or a cessation of
operations which is treated as such a withdrawal under Section 4062(e) of ERISA,
(c) a complete or partial withdrawal by any Loan Party or any ERISA Affiliate
from a Multi-employer Plan or notification that a Multi-employer Plan is in
reorganization, (d) the filing of a notice of intent to terminate, the treatment
of a Plan amendment as a termination under Section 4041 or 4041A of ERISA, or
the commencement of proceedings by the PBGC to terminate a Pension Plan or
Multi-employer Plan, (e) the occurrence of an event or condition which might
reasonably be expected to constitute grounds under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any Pension Plan
or Multi-employer Plan, (f) the imposition of any liability to PBGC under Title
IV of ERISA, other than for PBGC premiums due but not delinquent under
Section 4007 of ERISA, upon any Loan Party or any ERISA Affiliate, or (g) a
Pension Plan becomes subject to the at-risk requirements in Section 303 of ERISA
and Section 430 of the Code.

“Eurodollar Reserve Percentage” means, for any day during any Interest Period,
the reserve percentage (expressed as a decimal, rounded upward to the next
1/100th of 1%) in effect on such day applicable to member banks under
regulations issued from time to time by the Federal Reserve Board for
determining the maximum reserve requirement (including any emergency,
supplemental, or other marginal reserve requirement) with respect to
Eurocurrency funding (currently referred to as “Eurocurrency liabilities”). The
LIBOR Rate for each outstanding LIBOR Rate Loan shall be adjusted automatically
as of the effective date of any change in the Eurodollar Reserve Percentage.

“Event of Default” has the meaning specified in Section 9.1.

“Exchange Act” means the Securities Exchange Act of 1934, and regulations
promulgated thereunder.

“Excluded Tax” means, with respect to the Agent, any Lender, any Letter of
Credit Issuer, or any other recipient of a payment to be made by or on account
of any Obligation, (a) taxes imposed on or measured by its overall net income
(however denominated), and franchise taxes imposed on it (in lieu of net income
taxes), by the jurisdiction (or any political subdivision thereof) under the
laws of which such recipient is organized or in which its principal office is
located or, in the case of any Lender, in which its applicable Lending Office is
located; or with respect to any recipient, Taxes imposed as a result of a
present or former connection between such recipient and the jurisdiction
imposing such Tax (other than connections arising from such recipient having
executed, delivered, become a party to, performed its obligations under,
received payments under, received or perfected a security interest under,
engaged in any other transaction pursuant to or enforced any Loan Document, or
sold or assigned an interest in any Loan or Loan Document); (b) in the case of a
Foreign Lender, any withholding tax, and

 

  15   Annex A

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any tax under Section 871 or 881 of the Code, attributable to such Foreign
Lender’s failure or inability (other than an inability as a result of a Change
in Law) to comply with subsections (c) and (d) of Section 4.1, or any
withholding tax, and any tax under Section 871 or 881 of the Code, imposed on
amounts payable to such Foreign Lender pursuant to laws in force at the time
such Foreign Lender becomes a party to this Agreement or designates a new
Lending Office, except to the extent that such Foreign Lender (or its assignor,
if any) was entitled, at the time of such failure or inability, designation of a
new Lending Office, or assignment, as the case may be, to receive additional
amounts from the Borrowers with respect to such withholding tax pursuant to
subsections (a) and (b) of Section 4.1; (c) any branch profits taxes imposed by
the United States of America (or any political subdivision thereof) or any
similar tax imposed by the jurisdiction (or any political subdivision thereof)
under the laws of which such recipient is organized or in which such recipient’s
applicable principal office is located or, in the case of any Lender, in which
its applicable Lending Office is located; (d) any backup withholding taxes that
are required by the Code to be withheld from amounts payable to a Lender;
(e) any Taxes imposed on amounts payable (directly or indirectly) to a
Participant that is not a party to this Agreement at such time, except to the
extent such Taxes would have been imposed if such sale of participation had not
been made; (f) any Taxes imposed on amounts payable (directly or indirectly) to
an Assignee that was not, at the time any Taxes would have been imposed, a
Lender who is party to this Agreement, except to the extent that such Taxes
would have been imposed if such assignment had not been made; and (g) any U.S.
federal withholding Taxes imposed under FATCA.

“Existing Credit Agreement” has the meaning specified in the recitals.

“Existing Letters of Credit” means all “Letters of Credit” issued and
outstanding under the Existing Credit Agreement.

“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this
Agreement (or any amended or successor version that is substantively comparable
and not materially more onerous to comply with), and any current or future
regulations or official interpretations thereof.

“FDIC” means the Federal Deposit Insurance Corporation, and any Governmental
Authority succeeding to any of its principal functions.

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

“Federal Reserve Board” means the Board of Governors of the Federal Reserve
System or any successor thereto.

“Fee Letter” means that certain letter agreement relating to certain fees dated
as of August 18, 2011, between Westlake, the Bank, and the Arranger.

“Financial Statements” means, according to the context in which it is used, the
financial statements referred to in Sections 5.2 and 6.6 or any other financial
statements required to be given to the Lenders pursuant to this Agreement.

 

  16   Annex A

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“Fiscal Year” means the Loan Parties’ fiscal year for financial accounting
purposes. The current Fiscal Year of the Loan Parties will end on December 31,
2011.

“Fixed Charge Coverage Ratio” means, with respect to any fiscal period of the
Loan Parties, the ratio of EBITDA during the preceding twelve (12) months to
Fixed Charges during such twelve (12) month period.

“Fixed Charges” means, with respect to any fiscal period of the Loan Parties on
a consolidated basis (excluding Unrestricted Subsidiaries), without duplication,
(a) interest expense, (b) Capital Expenditures, (c) scheduled principal payments
of Debt, prepayments and unscheduled payments (except (i) in connection with a
Concurrent permitted refinancing, replacement, or defeasance or (ii) pursuant to
Section 7.14(a)(iv) or 7.14(b)(ii)) of Debt, (d) payments on any deferred
payment plan for insurance premiums permitted pursuant to Section 7.13(h),
(e) cash Distributions paid by any Loan Party to Persons other than Westlake and
its Restricted Subsidiaries, and (f) Federal, state, local, and foreign income
taxes, excluding deferred taxes. For the purposes of this definition of “Fixed
Charges”, Capital Expenditures shall not include, without duplication,
(i) Designated Project Expenditures; (ii) Capital Expenditures funded (A) from
the net cash proceeds of, or in exchange for, a Concurrent Equity Issuance by
Westlake (other than to another Loan Party or a Subsidiary); or (B) from any
insurance proceeds and condemnation awards permitted to be applied to Capital
Expenditures hereunder; (iii) the amount by which the gross amount of the
purchase price of any Equipment is reduced by (A) the credit granted by the
seller of Equipment purchased by a Loan Party in connection with the trade-in of
an existing Equipment and (B) the proceeds of a sale of used or surplus fixed
assets; (iv) Asset Swaps; and (v) any Capital Expenditures funded with the GO
Zone/Ike Zone debt. Capital Expenditures incurred for maintenance purposes,
regardless of sources of funding, shall be included in the calculation of Fixed
Charges unless such expenditures are funded from (i) the net cash proceeds of,
or in exchange for, a Concurrent Equity Issuance by Westlake (other than to
another Loan Party or a Subsidiary) or (ii) the proceeds from the GO Zone/Ike
Zone debt. As used in this definition, “Concurrent” shall be not more than 45
days prior to the payment or incurrence of such Capital Expenditure or such
permitted refinancing, replacement, or defeasance, as the case may be.

“Foreign Lender” means any Lender that is organized under the laws of a
jurisdiction other than the laws of the United States, or any state or district
thereof.

“Foreign Subsidiary” of any Person means a Subsidiary of such Person that is
organized or incorporated under the laws of a jurisdiction other than a
jurisdiction of the United States.

“Fronting Exposure” means a Defaulting Lender’s Pro Rata Share of the Letter of
Credit Obligations, as applicable, except to the extent allocated to other
Lenders under Section 12.14(c).

“Full Payment” means, with respect to any Obligations, (a) the full and
indefeasible cash payment thereof, including any interest, fees and other
charges accruing during any insolvency proceeding under the Bankruptcy Code, or
under any other bankruptcy or insolvency law (whether or not allowed in the
proceeding); (b) the cancellation and return of all outstanding Letters of
Credit (or, in the alternative, with respect to Letters of Credit, providing
(i) cash collateral for all remaining Letters of Credit in an amount equal to
110% of the aggregate face amount of such Letters of Credit or (ii) a back-up
letter of credit for each such Letter of Credit in form and substance and from
an issuer acceptable to the Agent in its sole discretion); (c) with respect to
any LIBOR Rate Loans prepaid, payment of the amounts due under Section 4.4, if
any; and (d) a release of any and all liabilities, obligations, losses, damages,
penalties, judgments, proceedings, interest, costs and expenses of any kind
(including remedial response costs, and reasonable attorneys’ fees) at any time
of any Loan Party and any other Person that is liable for payment of any
Obligations or that has granted a Lien in favor of the Agent on its assets to

 

  17   Annex A

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secure any Obligations against the Agent, any Lender, and any Letter of Credit
Issuer arising on or before the payment date. No Revolving Loans shall be deemed
to have been paid in full until all Commitments related to such Revolving Loans
have expired or been terminated.

“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 activities.

“Funding Date” means the date on which a Borrowing occurs.

“GAAP” means generally accepted accounting principles and practices set forth
from time to time in the opinions and pronouncements of the Accounting
Principles Board and the American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting Standards Board (or
agencies with similar functions of comparable stature and authority within the
U.S. accounting profession), which are applicable to the circumstances as of the
Closing Date.

“Gas Supply/Purchase Agreement” means that certain service contract (together
with any supplement, annex, or exhibit thereto) to be entered into between a
Loan Party and the City of Westlake, Louisiana, in substantially the form
provided to the Agent on or before September 30, 2008, or other natural gas
supply and purchase agreements with other municipalities, pursuant to which such
Loan Party is to purchase a certain quantity of gas from the City of Westlake or
such other municipalities and under which such Loan Party may be required to
pledge certain cash collateral to secure its payment obligations.

“General Intangibles” means all of the Loan Parties’ now owned or hereafter
acquired general intangibles, choses in action, and causes of action and all
other intangible personal property of the Loan Parties of every kind and nature
(other than Accounts), including, without limitation, all contract rights,
payment intangibles, Proprietary Rights, corporate or other business records,
inventions, designs, blueprints, plans, specifications, patents, patent
applications, trademarks, service marks, trade names, trade secrets, goodwill,
copyrights, computer software, customer lists, registrations, licenses,
franchises, tax refund claims, any funds which may become due to any Loan Party
in connection with the termination of any Plan or other employee benefit plan or
any rights thereto and any other amounts payable to any Loan Party from any Plan
or other employee benefit plan, rights and claims against carriers and shippers,
rights to indemnification, business interruption insurance and proceeds thereof,
property, casualty, or any similar type of insurance and any proceeds thereof,
proceeds of insurance covering the lives of key employees on which any Loan
Party is beneficiary, rights to receive dividends, distributions, cash,
Instruments, and other property in respect of or in exchange for any letter of
credit, guarantee, claim, security interest, or other security held by or
granted to any Loan Party.

“Governmental Authority” means any federal, state, local, foreign or other
agency, authority, body, commission, court, instrumentality, political
subdivision, or other entity or officer exercising executive, legislative,
judicial, regulatory or administrative functions for any governmental, judicial,
investigative, regulatory or self-regulatory authority.

“Guarantor” means any Person, including, but not limited to, each Restricted
Subsidiary of Westlake, which undertakes to be liable for all or any part of the
Obligations by execution of an Obligations Guaranty or otherwise.

“Guaranty” means, with respect to any Person, all obligations of such Person
which in any manner directly or indirectly guarantee or assure, or in effect
guarantee or assure, the payment or performance of any indebtedness, dividend or
other obligations of any other Person (the “guaranteed

 

  18   Annex A

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obligations”), or assure or in effect assure the holder of the guaranteed
obligations against loss in respect thereof, including any such obligations
incurred through an agreement, contingent or otherwise: (a) to purchase the
guaranteed obligations or any property constituting security therefor; (b) to
advance or supply funds for the purchase or payment of the guaranteed
obligations or to maintain a working capital or other balance sheet condition;
or (c) to lease property or to purchase any debt or equity securities or other
property or services.

“Hazardous Materials” means any material that poses a threat to, or is regulated
to protect, human health, safety, public welfare or the environment, including
without limitation, “hazardous substance,” “pollutant or contaminant,”
“petroleum” and “natural gas liquids,” as those terms are defined or used in
Section 101 of the Comprehensive Environmental Response, Compensation, and
Liability Act, polychlorinated biphenyls, lead, asbestos, urea formaldehyde,
radioactive materials, putrescible materials, infectious materials, and toxic
microorganisms (including mold).

“Hedge Agreement” means any and all transactions, agreements, or documents now
existing or hereafter entered into, which provides for an interest rate, credit,
commodity, or equity swap, cap, floor, collar, forward foreign exchange
transaction, currency swap, cross currency rate swap, currency option, or any
combination of, or option with respect to, these or similar transactions, for
the purpose of hedging any Loan Party’s exposure to fluctuations in interest or
exchange rates, loan, credit exchange, security or currency valuations or
commodity prices; provided that such Hedge Agreement shall be incurred in the
ordinary course of business and consistent with prior business practices of the
Loan Parties and not for speculative purposes.

“Indemnified Taxes” means Taxes other than Excluded Taxes.

“Instruments” means all instruments as such term is defined in the UCC, now
owned or hereafter acquired by any Loan Party.

“Intangible Assets” means assets that are considered to be intangible assets
under GAAP, including customer lists, goodwill, computer software, copyrights,
trade names, trade marks, patents, unamortized deferred charges, unamortized
debt discount, and capitalized research and development costs.

“Interest Period” means, as to any LIBOR Rate Loan, the period commencing on the
Funding Date of such Loan or on the Continuation/Conversion Date on which the
Loan is converted into or continued as a LIBOR Rate Loan, and ending on the date
one, two, or three months thereafter as selected by the Borrowers in any Notice
of Borrowing, in the form attached hereto as Exhibit D, or Notice of
Continuation/Conversion, in the form attached hereto as Exhibit E, provided
that:

(a) if any Interest Period would otherwise end on a day that is not a Business
Day, that Interest Period shall be extended to the following Business Day unless
the result of such extension would be to carry such Interest Period into another
calendar month, in which event such Interest Period shall end on the preceding
Business Day;

(b) any Interest Period pertaining to a LIBOR Rate Loan that 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 the calendar month at the end of such
Interest Period; and

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

 

  19   Annex A

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“Interest Rate” means each or any of the interest rates, including the Default
Rate, set forth in Section 2.1.

“Inventory” means all of any Loan Party’s now owned and hereafter acquired
inventory, goods and merchandise, wherever located, to be furnished under any
contract of service or held for sale or lease, all returned goods, raw
materials, work-in-process, finished goods (including embedded software), other
materials and supplies of any kind, nature, or description which are used or
consumed in any Loan Party’s business or used in connection with the packing,
shipping, advertising, selling or finishing of such goods, merchandise, and all
documents of title or other Documents representing them.

“IRBs” means the $10,889,000 original principal amount Calcasieu Parish Public
Trust Authority Waste Disposal Revenue Bonds issued pursuant to the Indenture of
Trust dated December 1, 1997, between Calcasieu Parish Public Trust Authority,
as issuer, and JPMorgan Chase Bank (formerly known as The Chase Manhattan Bank),
as trustee.

“IRS” means the Internal Revenue Service and any Governmental Authority
succeeding to any of its principal functions under the Code.

“Joint Venture” means any joint venture between any Loan Party or any JV
Subsidiary and any other Person, if such joint venture is owned 50% or less by
the Loan Parties or any JV Subsidiary.

“JV Subsidiary” means each Subsidiary of a Loan Party (a) that, at any time,
directly holds a Capital Stock in any Joint Venture and (b) that has no other
material assets.

“Latest Projections” means: (a) on the Closing Date and thereafter until the
Agent receives new projections pursuant to Section 5.2(f), the projections of
the Loan Parties’ financial condition, results of operations, and cash flows
delivered to the Agent on January 28, 2011; and (b) thereafter, the projections
most recently received by the Agent pursuant to Section 5.2(f).

“Lending Office” means the office designated as such by the applicable Lender at
the time it becomes party to this Agreement or thereafter by notice to the Agent
and Westlake.

“Lender” and “Lenders” have the meanings specified in the introductory paragraph
hereof and shall include the Agent to the extent of any Agent Advance
outstanding and the Bank to the extent of any Non-Ratable Loan outstanding;
provided that no such Agent Advance or Non-Ratable Loan shall be taken into
account in determining any Lender’s Pro Rata Share.

“Letter of Credit” has the meaning specified in Section 1.3(a).

“Letter of Credit Documents” means all documents, instruments and agreements
(including any request or applications for a Letter of Credit) delivered by the
Borrowers or any other Person to a Letter of Credit Issuer or the Agent in
connection with any Letter of Credit.

“Letter of Credit Fee” has the meaning specified in Section 2.6.

“Letter of Credit Indemnitees” means the Letter of Credit Issuers and their
officers, directors, employees, trustees, Affiliates, agents and attorneys.

“Letter of Credit Issuer” means the Bank, any affiliate of the Bank, or any
Additional Letter of Credit Issuer.

 

  20   Annex A

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“Letter of Credit Obligations” means the sum (without duplication) of (a) all
amounts owing by the Borrowers for any drawings under Letters of Credit; (b) the
stated amount of all outstanding Letters of Credit; and (c) all fees and other
amounts owing with respect to Letters of Credit.

“Letter-of-Credit Rights” means “letter-of-credit rights” as such term is
defined in the UCC, now owned or hereafter acquired by any Loan Party, including
rights to payment or performance under a letter of credit, whether or not any
Loan Party, as beneficiary, has demanded or is entitled to demand payment or
performance.

“Letter of Credit Subfacility” means $400,000,000.

“LIBOR Interest Payment Date” means, with respect to a LIBOR Rate Loan, the
Termination Date and the last day of each Interest Period applicable to such
Loan or, with respect to each Interest Period of greater than three months in
duration, the last day of the third month of such Interest Period and the last
day of such Interest Period.

“LIBOR Rate” means, for any Interest Period, with respect to LIBOR Rate Loans,
the rate of interest per annum determined pursuant to the following formula:

 

LIBOR Rate =   

Offshore Base Rate

   1.00 - Eurodollar Reserve Percentage

“LIBOR Rate Loan” means a Revolving Loan during any period in which it bears
interest based on the LIBOR Rate.

“Lien” means: (a) any interest in property securing an obligation owed to, or a
claim by, a Person other than the owner of the property, whether such interest
is based on the common law, statute, or contract, and including a security
interest, charge, claim, or lien arising from a mortgage, deed of trust,
encumbrance, pledge, hypothecation, assignment, deposit arrangement, agreement,
security agreement, conditional sale or trust receipt, or a lease, consignment,
or bailment for security purposes; and (b) to the extent not included under
clause (a), any reservation, exception, encroachment, easement, right-of-way,
covenant, condition, restriction, lease, or other title exception or encumbrance
affecting property.

“Limited Recourse Stock Pledge” means the pledge of Capital Stock in any Joint
Venture or any Unrestricted Subsidiary to secure Non-Recourse Debt of such Joint
Venture or Unrestricted Subsidiary, which pledge is made by a Restricted
Subsidiary of Westlake, the activities of which are limited to making and
managing investments, and owning Capital Stock in such Joint Venture or
Unrestricted Subsidiary, but only for so long as its activities are so limited.

“Loan Account” means the loan account of the Borrowers, which account shall be
maintained by the Agent.

“Loan Documents” means this Agreement, the Notes, the Collateral Documents, the
Letters of Credit, any Letter of Credit Document, and any other agreements,
instruments, and documents heretofore, now or hereafter evidencing, securing,
guaranteeing or otherwise relating to the Obligations, the Collateral, or any
other aspect of the transactions contemplated by this Agreement; provided that
for purposes of the definition of “Material Adverse Effect” and Articles IV
through XII, “Loan Documents” shall not include Bank Products.

“Loan Parties” means, on any date of determination, each Borrower and all
Guarantors, and “Loan Party” means any Borrower or any Guarantor.

 

  21   Annex A

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“Loans” means, collectively, all loans and advances provided for in Article 1,
and shall include Revolving Loans.

“Local Accounts” has the meaning specified in Section 8.1(k).

“Majority Lenders” means at any date of determination Lenders whose Pro Rata
Shares aggregate more than 50%, provided, however, that the Commitments and
Loans of any Defaulting Lender shall be excluded from such calculation.

“Margin Stock” means “margin stock” as such term is defined in Regulation T, U,
or X of the Federal Reserve Board.

“Material Adverse Effect” means (a) a material adverse change in, or a material
adverse effect upon, the assets, liabilities, business, operations, properties,
or condition (financial or otherwise) of Westlake, the Loan Parties taken as a
whole or the Collateral; (b) a material impairment of the ability of any Loan
Party to perform under any Loan Document to which it is a party; or (c) a
material adverse effect upon the legality, validity, binding effect, or
enforceability against any Loan Party of any Loan Document to which it is a
party.

“Material Agreement” means any agreement or arrangement to which a Loan Party is
a party or is bound as of the date thereof (other than the Loan Documents),
without duplication, that is deemed to be a material contract under any
securities law applicable to such Loan Party, including the Securities Act of
1933.

“Material Subsidiary” means any Restricted Subsidiary (a) the fair market value
of whose assets is at least $5,000,000 or (b) whose sales in the immediately
preceding twelve (12) month period are at least $10,000,000.

“Maximum Inventory Loan Amount” means $325,000,000.

“Maximum Rate” has the same meaning specified in Section 2.3.

“Maximum Revolver Amount” means the aggregate amount of the Commitments of the
Lenders, as such amount may be increased or reduced from time to time pursuant
to the terms of this Agreement.

“Moody’s” means Moody’s Investors Services, Inc. and any successor thereto.

“Multi-employer Plan” means a “multi-employer plan” as defined in
Section 4001(a)(3) of ERISA which is or was at any time during the current year
or the immediately preceding five (5) years contributed to by any Loan Party or
any ERISA Affiliate.

“Net Amount of Eligible Accounts” means, at any time, the gross amount of
Eligible Accounts less sales, excise, or similar taxes, and less returns,
discounts, claims, credits, allowances, accrued rebates, offsets, deductions,
counterclaims, disputes, and other defenses of any nature at any time issued,
owing, granted, outstanding, available, or claimed.

“Net Orderly Liquidation Value” shall mean (a) the “net orderly liquidation
value” determined by a valuation company acceptable to the Agent after
performance of an Inventory valuation to be done at the Agent’s request and the
Borrowers’ expense, less the amount estimated by such valuation company for
marshalling, reconditioning, carrying, and sales expenses designed to maximize

 

  22   Annex A

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the resale value of such Inventory and assuming that the time required to
dispose of such Inventory is three (3) months; or (b) if no such Inventory
valuation has been requested by the Agent, the value customarily attributed to
Inventory in the appraisal industry for Inventory of similar quality and
quantity, and similarly dispersed (under similar and relevant circumstances
under standard asset-based lending procedures), at the time of the valuation,
less the amount customarily estimated in the appraisal industry at the time of
any determination for marshalling, recondition, carrying, and sales expenses
designed to maximize the resale value of such Inventory and assuming that the
time required to dispose of such Inventory is three (3) months.

“Non-Continuing Lenders” has the meaning specified in Section 13.22.

“Non-Ratable Loan” and “Non-Ratable Loans” have the meanings specified in
Section 1.2(h).

“Non-Recourse Debt” means Debt:

(a) as to which no Loan Party (x) provides credit support of any kind (including
any undertaking, agreement or instrument that would constitute Debt), (y) is
directly or indirectly liable as a guarantor or otherwise, or (z) constitutes
the lender (excluding customary unsecured completion guarantees);

(b) no default with respect to which (including any rights that the holders of
the Debt may have to take enforcement action against an Unrestricted Subsidiary)
would permit upon notice, lapse of time or both any holder of any other Debt of
a Loan Party to declare a default on such other Debt or cause the payment of the
Debt to be accelerated or payable prior to its stated maturity; and

(c) as to which the Lenders have been notified in writing that they will not
have any recourse to the stock or assets of a Loan Party, other than the Capital
Stock of a Joint Venture or of an Unrestricted Subsidiary pledged by a Loan
Party as a Limited Recourse Stock Pledge.

“Note and Notes” have the same meaning specified in Section 1.2(a)(ii).

“Notice of Borrowing” has the meaning specified in Section 1.2(b).

“Notice of Continuation/Conversion” has the meaning specified in Section 2.2(b).

“Obligation Guaranty” means the (a) the Second Amended and Restated Obligation
Guaranty in substantially the form and upon the terms of Exhibit C, executed and
delivered by any Person pursuant to the requirements of the Loan Documents; and
(b) any amendments, modifications, supplements, restatements, ratifications, or
reaffirmations of any Guaranty made in accordance with the Loan Documents.

“Obligations” means all present and future loans, advances, liabilities,
obligations, covenants, duties, and debts owing by any Loan Party to the Agent
and/or any Lender, arising under or pursuant to this Agreement or any of the
other Loan Documents, whether or not evidenced by any note, or other instrument
or document, whether arising from an extension of credit, opening of a letter of
credit, acceptance, loan, guaranty, indemnification or otherwise, whether direct
or indirect, absolute or contingent, due or to become due, primary or secondary,
or joint or several, as principal or guarantor, and including all principal,
interest, charges, expenses, fees, attorneys’ fees, filing fees, and any other
sums chargeable to any Loan Party hereunder or under any of the other Loan
Documents. “Obligations”

 

  23   Annex A

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includes, without limitation, (a) the principal of, and interest on, all
Revolving Loans, (b) all Letter of Credit Obligations, and (c) all debts,
liabilities and obligations now or hereafter arising from or in connection with
Bank Products.

“Offshore Base Rate” means, for any Interest Period with respect to a LIBOR Rate
Loan, the rate per annum equal to the British Bankers Association LIBOR Rate
(the “BBA LIBOR”), as published by Reuters (or other commercially available
source providing quotations of BBA LIBOR as designated by the Agent from time to
time) at approximately 11:00 a.m. (London time) two (2) Business Days prior to
the first day of such Interest Period for Dollar deposits (for delivery on the
first day of such Interest Period) with a term equivalent to such Interest
Period. If for any reason such rate is not available, the Offshore Base Rate
shall be, for any Interest Period, the rate per annum determined by the Agent as
the rate of interest at which dollar deposits in the approximate amount of the
LIBOR Rate Loan comprising part of such Borrowing would be offered by the Bank’s
London Branch to major banks in the offshore dollar market at their request at
or about 11:00 a.m. (London time) two (2) Business Days prior to the first day
of such Interest Period for a term comparable to such Interest Period.

“Other Taxes” means all present or future stamp or documentary taxes or any
other excise or property taxes, charges or similar levies arising from any
payment made under any Loan Document or from the execution, delivery,
registration, or enforcement of, or otherwise with respect to, any Loan
Document.

“Pari Passu Bank Product Obligations” means all debts, liabilities and
obligations of the Loan Parties now or hereafter arising from or in connection
with the Hedge Agreements constituting Bank Products and reported to the Agent
pursuant to Section 7.23; provided that the Pari Passu Bank Product Obligation
with respect to any Hedge Agreement shall be equal to the Bank Product Reserves
established for such Hedge Agreement in accordance with Section 7.23.

“Participant” means any Person who shall have been granted the right by any
Lender to participate in the financing provided by such Lender under this
Agreement, and who shall have entered into a participation agreement in form and
substance satisfactory to such Lender.

“Patent and Trademark Agreements” means any Patent Security Agreement and any
Trademark Security Agreement, executed and delivered by any Loan Party to the
Agent to evidence and perfect the Agent’s security interest in each such Loan
Party’s present and future patents, trademarks, and related licenses and rights,
for the benefit of the Agent and the Lenders, as amended, restated, amended and
restated, or otherwise modified from time to time.

“Payment Account” means each bank account established pursuant to the Security
Agreement, to which the proceeds of Accounts and other Collateral are deposited
or credited, and which is maintained in the name of the Agent or the Borrowers,
as the Agent may determine, on terms acceptable to the Agent.

“PCBs” means polychlorinated biphenyls.

“PBGC” means the Pension Benefit Guaranty Corporation or any Governmental
Authority succeeding to the functions thereof.

“Pending Revolving Loans” means, at any time, the aggregate principal amount of
all Revolving Loans requested in any Notice of Borrowing received by the Agent
which have not yet been advanced.

 

  24   Annex A

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“Pension Plan” means a pension plan (as defined in Section 3(2) of ERISA)
subject to Title IV of ERISA which any Loan Party or any ERISA Affiliate
sponsors, maintains, or to which it makes, is making, or is obligated to make
contributions, or in the case of a Multi-employer Plan has made contributions at
any time during the immediately preceding five (5) plan years.

“Permitted Business” means the petrochemical, chemicals, and vinyls or plastic
fabrications business and any other businesses related, incidental,
complementary or ancillary thereto.

“Permitted Consideration” means (a) cash, (b) Cash Equivalents, (c) publicly
traded equity securities of a Person with a market capitalization (not held by
Affiliates of such Person) of at least $500,000,000, or (d) a controlling
interest in, or long-term assets used or useful in, a business engaged in a
Permitted Business. For purposes of this definition, each of the following will
also be deemed to be cash:

(i) any liabilities, as shown on its most recent balance sheet, of any Loan
Party or its Restricted Subsidiaries (other than contingent liabilities and
liabilities that are by their terms subordinated to the Obligations) that are
assumed by the transferee of any such assets pursuant to a customary novation
agreement that releases such Loan Party or such Restricted Subsidiaries from
further liability;

(ii) any securities, notes or other obligations received by a Loan Party or its
Restricted Subsidiaries from such transferee that are promptly, subject to
ordinary settlement periods, converted or monetized by such Loan Party or such
Restricted Subsidiaries into cash, to the extent of the cash received in that
conversion or monetization;

(iii) any Capital Stock or assets of any Person or division conducting a
Permitted Business, if, in the case of any such acquisition of Capital Stock and
after giving effect thereto, such Person will be a Restricted Subsidiary of a
Loan Party; and

(iv) assets that are not classified as current assets under GAAP and that are
used or useful in a Permitted Business.

“Permitted Group” means any group of investors that is deemed to be a “person”
(as that term is used in Section 13(d)(3) of the Exchange Act) at any time prior
to Westlake’s initial public offering of common stock, provided that no single
Person (other than the Principals and their Related Parties) Beneficially Owns
(together with its Affiliates) more of the Voting Stock of the Borrower that is
Beneficially Owned by such group of investors than is then collectively
Beneficially Owned by the Principals and their Related Parties in the aggregate.

“Permitted Liens” means:

(a) Liens for taxes or statutory Liens for taxes, assessments and other
governmental charges, provided that (i) the payment of which is not yet due and
payable, or (ii) the payment of such taxes or governmental charges which are due
and payable is being contested in good faith and by appropriate proceedings
diligently pursued and as to which adequate financial reserves have been
established on the applicable Loan Party’s books and records;

(b) the Agent’s Liens;

(c) Liens consisting of deposits made in the ordinary course of business in
connection with, or to secure payment of, obligations under workers’
compensation,

 

  25   Annex A

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unemployment insurance, social security, and other similar laws, or to secure
the performance of bids, tenders, or contracts (other than for the repayment of
Debt), or to secure indemnity, performance or other similar bonds for the
performance of bids, tenders or contracts (other than for the repayment of
Debt), or to secure statutory obligations (other than liens arising under ERISA
or Environmental Liens) or surety or appeal bonds, or to secure indemnity,
performance or other similar bonds;

(d) Liens securing the claims or demands of materialmen, mechanics, carriers,
rail carriers, warehousemen, landlords, and other like Persons arising in the
ordinary course of business, provided that if any such Lien arises from the
nonpayment of such claims or demands when due, such claims or demands do not
exceed $2,500,000 if they create Liens on the Collateral, or $10,000,000 if they
do not create Liens on the Collateral, each in the aggregate, unless any such
claims or demands are being contested in good faith and by appropriate
proceedings diligently pursued promptly after knowledge thereof and as to which
adequate financial reserves have been established on the applicable Loan Party’s
books and records;

(e) Liens constituting encumbrances in the nature of reservations, exceptions,
encroachments, easements, rights of way, covenants running with the land, and
other similar title exceptions or encumbrances affecting any Real Estate;
provided that they do not in the aggregate materially detract from the value of
the Real Estate or materially interfere with its use in the ordinary conduct of
the applicable Loan Party’s business;

(f) Liens arising from judgments and attachments in connection with court
proceedings, provided that the attachment or enforcement of such Liens would not
result in an Event of Default hereunder and such Liens are being contested in
good faith by appropriate proceedings, adequate reserves have been set aside and
no material property is subject to a material risk of loss or forfeiture and the
claims in respect of such Liens are fully covered by insurance (subject to
ordinary and customary deductibles) and a stay of execution pending appeal or
proceeding for review is in effect;

(g) the interest of a lessor or a licensor under an operating lease or license
under which a Loan Party is lessee, sublessee or licensee, including protective
financing statement filings;

(h) Liens securing Debt existing on the Closing Date to the extent such Liens
are described on Schedule 7.17;

(i) Liens evidencing consignments of Inventory;

(j) Liens securing Debt permitted pursuant to Section 7.13(h) so long as such
Liens attached only to unearned premiums for such financed insurance;

(k) Liens securing (A) Hedge Agreements or (B) the Loan Parties’ obligations
under the Gas Supply/Purchase Agreement, to the extent required thereunder;
provided that if such Hedge Agreements do not constitute Bank Products, the
aggregate amount secured by all Liens under such Hedge Agreements and the Gas
Supply/Purchase Agreement does not exceed $20,000,000 and the assets subject to
such Liens attach solely to cash held in a specified cash collateral account or
margin accounts pledged to secure such obligations, so long as at the time that
such Liens are incurred (i) the Availability is not less than $75,000,000, and
(ii) Fixed Charge Coverage Ratio is at least 1:0:1.0, provided further that the
amount of cash so pledged shall not be increased if at any time (i) the
Availability is less than $75,000,000, or (ii) Fixed Charge Coverage Ratio is
less than 1:0:1.0;

 

  26   Annex A

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(l) Liens permitted under Section 7.13(m);

(m) (i) Liens on cash and Cash Equivalents used to make a defeasance of Debt,
the payment or prepayment of which Debt is permitted by this Agreement, and
(ii) Liens on securities, brokerage and commodity accounts and all cash, Cash
Equivalents and other assets therein;

(n) customary Liens for the fees, costs and expenses of trustees and escrow
agents pursuant to any indenture, escrow agreement or similar agreement
establishing a trust or escrow agreement;

(o) Liens on property of a Person existing at the time such Person becomes a
Restricted Subsidiary or is merged with or into or consolidated with any Loan
Party; provided that (i) such property does not constitute Collateral and
(ii) such Liens were in existence prior to the contemplation of such
acquisition, merger or consolidation and do not extend to any assets other than
those of the Person merged into or consolidated with any Loan Party or that
becomes a Restricted Subsidiary;

(p) So long as such transactions are otherwise permitted under this Agreement,
(i) Liens upon or in property acquired (including acquisitions through merger or
consolidation) or constructed or improved by any such Loan Party including
general tangibles, proceeds and improvements, accessories and upgrades thereto,
and created contemporaneously with, or within twelve (12) months after, such
acquisition or the completion of construction or improvement to secure or
provide for the payment of all or a portion of the purchase price of such
property or the cost of construction or improvement thereof (including any
Indebtedness incurred to finance such acquisition, construction or improvement),
as the case may be, (ii) Liens on property (including any unimproved portion of
partially improved property) of such Loan Party created within twelve
(12) months of completion of construction of a new plan or plans on such
property to secure all or part of the cost of such construction (including any
Indebtedness incurred to finance such construction) if, in the opinion of such
Loan Party, such property or such portion thereof was prior to such construction
substantially unimproved for the use intended by such Loan Party; and (iii) in
the case of Capital Leases, Liens on the assets subject to such Capitalized
Leases and proceeds (including, without limitation, proceeds from associated
contracts and insurances) of, and improvements, accessories and upgrades to, the
property leased pursuant thereto; provided, however, in each of the foregoing
clauses (i), (ii), and (iii), no such Lien shall extend to or cover (A) any
property other than the property being acquired, constructed, improved or leased
(including any unimproved portion of a partially improved property) including
general intangibles, proceeds and improvements, accessories and upgrades thereto
or (B) any Collateral;

(q) Limited Recourse Stock Pledge; and

(r) Liens on property existing at the time of acquisition of such property and
not constituting Collateral, provided that such Liens were in existence prior
to, and not incurred in contemplation of, such acquisition.

“Person” means any individual, sole proprietorship, partnership, limited
liability company, joint venture, trust, unincorporated organization,
association, corporation, Governmental Authority, or any other entity.

 

  27   Annex A

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“Plan” means an employee benefit plan (as defined in Section 3(3) of ERISA)
established by a Loan Party or with respect to which any Loan Party makes, is
making, or is obligated to make contributions and includes any Pension Plan.

“Prime Rate” means the rate of interest announced by the Bank from time to time
as its prime rate. Such rate is set by the Bank on the basis of various factors,
including its costs and desired return, general economic conditions and other
factors, and is used as a reference point for pricing some loans, which may be
priced at, above or below such rate. Any change in such rate announced by the
Bank shall take effect at the opening of business on the day specified in the
public announcement of such change.

“Principals” means the descendents of T.T. Chao, including by adoption, and the
spouses of any such individuals.

“Project Finance Subsidiary” means a Subsidiary that is a special-purpose entity
created to (a) construct, acquire, operate and/or own any asset or project that
will be or is financed solely with Non-Recourse Debt for such asset or project
and related equity investments in, loans to, or capital contributions in, such
Subsidiary that are not prohibited hereby and/or (b) own an interest in any such
asset or project.

“Proprietary Rights” means all of any Loan Party’s now owned and hereafter
arising or acquired: licenses, franchises, permits, patents, patent rights,
copyrights, works which are the subject matter of copyrights, trademarks,
service marks, trade names, trade styles, patent, trademark, and service mark
applications, and all licenses and rights related to any of the foregoing,
including those federally registered or otherwise material patents, trademarks,
service marks, trade names, and copyrights set forth on Schedule 6.9 hereto, and
all other rights under any of the foregoing, all extensions, renewals, reissues,
divisions, continuations, and continuations-in-part of any of the foregoing, and
all rights to sue for past, present and future infringement of any of the
foregoing.

“Pro Forma Fixed Charge Coverage Ratio” means, with respect to any proposed
Acquisition, calculation of the Fixed Charge Coverage Ratio with respect to the
immediately preceding twelve (12) months, calculated as though the proposed
Acquisition had occurred at the beginning of such period, and calculation of the
Fixed Charge Coverage Ratio on a pro forma basis, based on the Loan Parties’
best estimates as of the date of calculation, of the ratio of EBITDA during the
succeeding twelve (12) months to the projected Fixed Charges during such
succeeding twelve (12) month period, after giving effect to the proposed
Acquisition.

“Pro Rata Share” means, with respect to a Lender, a fraction (expressed as a
percentage), the numerator of which is the amount of such Lender’s Commitment
and the denominator of which is the sum of the amounts of all of the Lenders’
Commitments, or if no Commitments are outstanding, a fraction (expressed as a
percentage), the numerator of which is the amount of Obligations owed to such
Lender (excluding any Obligations with respect to Bank Products) and the
denominator of which is the aggregate amount of the Obligations owed to the
Lenders (excluding any Obligations with respect to Bank Products), in each case
giving effect to a Lender’s participation in Non-Ratable Loans and Agent
Advances.

“Real Estate” means all of any Loan Party’s now or hereafter owned or leased
estates in real property, including, without limitation, all fees, leaseholds
and future interests, together with all of any Loan Party’s now or hereafter
owned or leased interests in the improvements thereon, the fixtures attached
thereto, and the easements appurtenant thereto.

 

  28   Annex A

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“Reimbursement Date” has the meaning set forth in Section 1.3(f).

“Related General Intangibles” means all of each Loan Party’s intangible personal
property used or useful for, in connection with, or in any respect related to,
any Accounts, Inventory, Instruments, Chattel Paper, Documents, or Deposit
Accounts, which Related General Intangibles shall include all money, General
Intangibles (including payment intangibles and software), and Proprietary
Rights, together with all additions, amendments, and modifications thereto,
extensions, renewals, enlargements, and proceeds thereof, substitutions
therefor, and income and profits therefrom. To the extent obtained in connection
with or otherwise related to Accounts, Inventory, Instruments, Chattel Paper,
Documents, or Deposit Accounts, the following are included, without limitation,
in the definition of “Related General Intangibles”: loan commitments, financing
arrangements, bonds, leases, permits, sales contracts, insurance policies, and
the proceeds therefrom, books and records, funds, bank deposits; all Proprietary
Rights used in connection therewith; any award, remuneration, settlement, or
compensation heretofore made or hereafter to be made by any Governmental
Authority to any Loan Party, all deposits, funds, accounts, contract rights, or
documents, arising from or by virtue of any transactions; all permits, licenses,
franchises, certificates, and other rights and privileges; all proceeds arising
from or by virtue of the sale, lease, or other disposal of all or any part of
the foregoing; and all proceeds (including premium refunds) payable or to be
payable under each policy of insurance relating to the foregoing.

“Related Party” means (a) any controlling stockholder, 80% (or more) owned
Subsidiary, or immediate family member (in the case of an individual) of any
Principal or (b) any Person, the beneficiaries, stockholders, partners, owners,
or Persons beneficially holding a 50% or more controlling interest of which
consist of any one or more Principals and/or such other Persons referred to in
the immediately preceding clause (a).

“Release” means a release, spill, emission, leaking, pumping, injection,
deposit, disposal, discharge, dispersal, leaching, or migration of any Hazardous
Materials into the environment, including the movement of Hazardous Materials
through or in the air, soil, surface water, groundwater or Real Estate or other
property.

“Reportable Event” means, any of the events set forth in Section 4043(b) of
ERISA or the regulations thereunder, other than any such event for which the
30-day notice requirement under ERISA has been waived in regulations issued by
the PBGC.

“Required Lenders” means at any time Lenders whose Pro Rata Shares aggregate
more than 66-2/3%; provided, however, that the Commitments and Loans of any
Defaulting Lender shall be excluded from such calculation.

“Requirement of Law” means, as to any Person, any law (statutory or common),
treaty, rule or regulation or determination of an arbitrator or of a
Governmental Authority, in each case applicable to or binding upon the Person or
any of its property or to which the Person or any of its property is subject.

“Reserves” means reserves that limit the availability of credit hereunder,
consisting of reserves against Availability, Eligible Accounts, or Eligible
Inventory, established by the Agent from time to time in the Agent’s reasonable
credit judgment. Without limiting the generality of the foregoing, the following
reserves shall be deemed to be a reasonable exercise of the Agent’s credit
judgment: (a) Bank Product Reserves, (b) a reserve for accrued, unpaid interest
on the Obligations, (c) reserves for rent at leased locations subject to
statutory or contractual landlord liens, (d) Inventory shrinkage,
(e) Environmental Compliance Reserves, (f) customs charges, (g) dilution,
(h) carriers’, processors’,

 

  29   Annex A

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warehousemen’s, or bailees’ charges, (i) reserves for nonpayment of taxes,
assessments, fees or other governmental charges and materialmen, and mechanics
claims, (j) from the date of declaration of any dividend until the date on which
such dividend is actually made, Reserves equal to the amount of any dividend
declared under Section 7.10, and (k) reserves for the payment of the 6 5/8%
Senior Notes due 2016 if such notes have not been refinanced, defeased or
redeemed 90 days prior to the maturity date thereof.

“Responsible Officer” means the chief executive officer, president, chief
financial officer, treasurer, assistant treasurer, or controller of a Loan
Party. Any document delivered hereunder that is signed by a Responsible Officer
of a Loan Party shall be conclusively presumed to have been authorized by all
necessary corporate, limited liability company, and/or other action on the part
of such Loan Party and such Responsible Officer shall be conclusively presumed
to have acted on behalf of such Loan Party.

“Restricted Investment” means, as to any Loan Party, any acquisition of property
by such Loan Party in exchange for cash or other property, whether in the form
of an acquisition of stock, debt, or other indebtedness or obligation, or the
purchase or acquisition of any other property, or an investment, loan, advance,
extension of credit, capital contribution, or subscription, except the
following:

(a) acquisitions of assets to be used in the business of such Loan Party so long
as (i) the acquisition costs thereof constitute Capital Expenditures permitted
hereunder, and (ii) such acquisition is otherwise permitted under this
Agreement;

(b) acquisitions of Inventory in the ordinary course of business of such Loan
Party;

(c) acquisitions of current assets or assets acquired and used in the ordinary
course of business of such Loan Party;

(d) direct obligations of the United States of America, or any agency thereof,
or obligations guaranteed by the United States of America, provided that such
obligations mature within one year from the date of acquisition thereof;

(e) acquisitions of certificates of deposit maturing within one year from the
date of acquisition, bankers’ acceptances, Eurodollar bank deposits, or
overnight bank deposits, in each case issued by, created by, or with a bank or
trust company organized under the laws of the United States of America or any
state thereof or any other country having capital and surplus aggregating at
least $100,000,000 or the Dollar equivalent thereof;

(f) acquisitions of commercial paper given a rating of “A2” or better by S&P or
“P2” or better by Moody’s and maturing not more than 90 days from the date of
creation thereof;

(g) loans, advances, extensions of credit, capital contributions, and other
investments (i) by any Loan Party to its Restricted Subsidiaries or (ii) to any
Loan Party by its Subsidiaries, or the direct or indirect owners of the Capital
Stock in such Loan Party;

(h) investments existing on the Closing Date and identified on Schedule 7.10,
including, without limitation, loans, advances, extensions of credit to, and
renewals or extensions thereof in accordance with Section 7.13, or capital
contributions and other investments in any Restricted Subsidiary of Westlake;

(i) Hedge Agreements;

 

  30   Annex A

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(j) Acquisitions made in accordance with Section 7.25;

(k) sales of Inventory by one Loan Party to another Loan Party so long as the
payment terms with respect to such Inventory are in accordance with the
customary business terms of such Loan Parties and payment for such Inventory is
made within thirty (30) days of delivery of such Inventory;

(l) payments on any Debt permitted by Section 7.13(j);

(m) transactions among Loan Parties so long as such transactions are otherwise
permitted by the terms of Section 7.15;

(n) investments in any Dollar denominated money market fund as defined by Rule
2a-7 under the Investment Company Act of 1940;

(o) fully collateralized repurchase agreements with a term of not more than 30
days for securities described in clause (f) above (without regard to the
limitation on maturity contained in such clause) and entered into with a
financial institution satisfying the criteria described in clause (e) above;

(p) marketable direct obligations issued by any U.S. corporation, state of the
United States of America or any political subdivision of any such state or any
public instrumentality thereof maturing within one year from the date of
acquisition thereof and, at the time of acquisition, having a rating of no lower
than single A from either S&P or from Moody’s;

(q) auction rate preferred stocks, whether taxable, tax-exempt or DRD, issued by
a domestic or foreign corporation, a domestic or foreign bank, or closed-end
municipal or taxable bond fund, that reset periodically through a modified
“Dutch” auction, the frequency of auctions of which allows for classification as
short term investment, available for sale, at the time of acquisition, having a
rating of no lower than triple A from either S&P or from Moody’s;

(r) floating rate, variable rate and auction rate bonds, whether taxable or
tax-exempt, issued by municipalities, states, state agencies, political
subdivision of states or any public instrumentality thereof, that reset
periodically through a modified “Dutch” auction, the frequency of auctions of
which allows for classification as short term investment, available for sale
thereof and, at the time of acquisition, having a rating of no lower than triple
A from either S&P or from Moody’s;

(s) investments in bond funds which are triple A rated by either Moody’s or S&P
which maintain a dollar weighted average portfolio maturity of not more than
three years and a dollar weighted average duration not exceeding two years;

(t) any acquisition of property, investment, loan, advance, extension of credit,
capital contribution or subscription made with the net cash proceeds of any
issuance of, or in exchange for, the equity of Westlake (other than issuance or
exchange to a Loan Party or any Subsidiary thereof);

(u) the receipt of non cash consideration in connection with any disposition
permitted by Section 7.9;

 

  31   Annex A

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(v) investments represented by Hedging Agreements otherwise permitted under this
Agreement, including the investments permitted under clause (k) of the
definition of “Permitted Liens”;

(w) loans or advances to employees made in the ordinary course of business of
any Loan Party in an aggregate principal amount not to exceed $1,000,000 at any
one time outstanding;

(x) Limited Recourse Stock Pledges;

(y) any investment by any Loan Party in a Person, if as a result of such
investment such Person becomes a Loan Party (subject to compliance with
Section 7.19); and

(z) other investments (measured on the date each such investment was made and
without giving effect to subsequent changes in value), when taken together with
all other investments made pursuant to this clause (z) that are at the time
outstanding not to exceed $20,000,000 (after giving effect to any dividends,
return of capital and subsequent reduction in the amount of any investments made
pursuant to this clause (z) as a result of the repayment or other disposition
thereof).

“Restricted Subsidiary” means, at any time of determination, all Subsidiaries of
Westlake, other than Unrestricted Subsidiaries of Westlake.

“Revolving Loans” has the meaning specified in Section 1.2 and includes each
Agent Advance and Non-Ratable Loan.

“S&P” means Standard & Poor’s Ratings Services, a division of the McGraw-Hill
Companies, Inc. and any successor thereto.

“SEC” means the Securities and Exchange Commission, or any Governmental
Authority succeeding to any of its principal functions.

“Security Agreement” means, collectively, the Second Amended and Restated
Security Agreements executed by the Loan Parties in favor of the Agent for the
benefit of the Agent and the other Lenders, as amended, restated, amended and
restated, or otherwise modified from time to time.

“Settlement” and “Settlement Date” have the meanings specified in
Section 12.14(a)(i).

“Solvent” means, when used with respect to any Person, that at the time of
determination:

(a) the assets of such Person, at a fair valuation, are in excess of the total
amount of its debts (including contingent liabilities); and

(b) the present fair saleable value of its assets is greater than its probable
liability on its existing debts as such debts become absolute and matured; and

(c) it is then able and expects to be able to pay its debts (including
contingent debts and other commitments) as they mature; and

 

  32   Annex A

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(d) it has capital sufficient to carry on its business as conducted and as
proposed to be conducted.

For purposes of determining whether a Person is Solvent, the amount of any
contingent liability shall be computed as the amount that, in light of all the
facts and circumstances existing at such time, represents the amount that can
reasonably be expected to become an actual or matured liability of such Person.

Notwithstanding the foregoing, debt of any Loan Party owed to any other Loan
Party shall not be included for purposes of calculating whether a Loan Party is
Solvent, so long as the Loan Parties, on a consolidated basis, were, are, and
will be Solvent.

“Stated Termination Date” means September 16, 2016.

“Subsidiary” of a Person means (a) any entity of which more than fifty percent
(50%) of the voting stock or other Capital Stock (in the case of Persons other
than corporations), is owned or controlled directly or indirectly by the Person,
or one or more of the Subsidiaries of the Person, or a combination thereof or
(b) any partnership (limited or general) of which such Person shall at any time
be the general partner or of which more than fifty percent (50%) of the issued
and outstanding partnership interests is owned or controlled directly or
indirectly by the Person, or one or more of the Subsidiaries of the Person, or a
combination thereof. Unless the context otherwise clearly requires, references
herein to a “Subsidiary” refer to a Subsidiary of Westlake.

“Supporting Letter of Credit” has the meaning specified in Section 1.3(g).

“Taxes” means all present or future taxes, levies, imposts, duties, deductions,
withholdings, assessments, fees or other charges imposed by any Governmental
Authority, including any interest, additions to tax or penalties applicable
thereto.

“Termination Date” means the earliest to occur of (a) the Stated Termination
Date, (b) the date the Total Facility is terminated either by the Borrowers
pursuant to Section 3.2 or by the Required Lenders pursuant to Section 9.2, and
(c) the date this Agreement is otherwise terminated for any reason whatsoever
pursuant to the terms of this Agreement.

“Tangible Assets” means the total consolidated assets, less goodwill and
intangibles, of the Loan Parties, as determined in accordance with GAAP and
reported in accordance with this Agreement.

“Total Facility” has the meaning specified in Section 1.1.

“Triggering Date” means the date upon which the Availability is less than or
equal to the greater of (a) 12.5% of the Maximum Revolver Amount and
(b) $50,000,000 at any time; provided that in the event the Availability has
been the greater of (i) 12.5% of the Maximum Revolver Amount and
(ii) $50,000,000 at all times for thirty (30) consecutive Business Days, then
the Triggering Date shall be deemed to not be continuing for purposes of this
Agreement, and the requirements of Section 7.21 shall not be required unless a
subsequent Triggering Date occurs.

“UCC” means the Uniform Commercial Code, as in effect from time to time, of the
State of New York or of any other state the laws of which are required as a
result thereof to be applied in connection with the issue of perfection of
security interests; provided that to the extent that the UCC is used to define
any term herein or in any other documents and such term is defined differently
in different Articles or Divisions of the UCC, the definition of such term
contained in Article or Division 9 shall govern.

 

  33   Annex A

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“Unfunded Pension Liability” means the excess, if any, of (a) the funding target
as defined under Section 430(d) of the Code without regard to the special
at-risk rules of Section 430(i) of the Code; over (b) the value of plan assets
as defined under Section 430(g)(3)(A) of the Code determined as of the last day
of each calendar year, without regard to the averaging which may be allowed
under Section 430(g)(3)(B) of the Code and reduced for any prefunding balance or
funding standard carryover balance as defined and provided for in Section 430(f)
of the Code.

“Unrestricted Subsidiary” means, at any time of determination thereof,
(a) Westlake International Services Corporation, Westlake Chemical (Asia) Inc.,
and Westlake Chemical (China) Corporation; (b) any Foreign Subsidiary of
Westlake or any other Loan Party; (c) any Project Finance Subsidiary; (d) any JV
Subsidiary and (e) any Subsidiary of an Unrestricted Subsidiary of Westlake.

“Unused Letter of Credit Subfacility” means the Letter of Credit Subfacility
minus the sum of (a) the aggregate undrawn amount of all outstanding Letters of
Credit plus, without duplication, (b) the aggregate unpaid reimbursement
obligations with respect to all Letters of Credit.

“Unused Line Fee” has the meaning specified in Section 2.5.

“Voting Stock” of any Person as of any date means the Capital Stock of such
Person that is at the time entitled to vote in the election of the board of
directors of such Person.

Accounting Terms. Any accounting term used in the Agreement shall have, unless
otherwise specifically provided herein, the meaning customarily given in
accordance with GAAP, and all financial computations in the Agreement shall be
computed, unless otherwise specifically provided therein, in accordance with
GAAP as consistently applied and using the same method for inventory valuation
as used in the preparation of the Financial Statements. If at any time any
change in GAAP would affect the computation of any financial ratio or
requirement set forth in any Loan Document, and either the Borrowers or the
Required Lenders shall so request, the Agent, the Lenders, and the Borrowers
shall negotiate in good faith to amend such ratio or requirement to preserve the
original intent thereof in light of such change in GAAP (subject to the approval
of the Required Lenders); provided that, until so amended, (a) such ratio or
requirement shall continue to be computed in accordance with GAAP prior to such
change therein and (b) the Borrowers shall provide to the Agent and the Lenders
Financial Statements and other documents required under this Agreement or as
reasonably requested hereunder setting forth a reconciliation between
calculations of such ratio or requirement made before and after giving effect to
such change in GAAP.

Interpretive Provisions.

(a) The meanings of defined terms are equally applicable to the singular and
plural forms of the defined terms.

(b) The words “hereof,” “herein,” “hereunder” and similar words refer to the
Agreement as a whole and not to any particular provision of the Agreement; and
Subsection, Section, Schedule and Exhibit references are to the Agreement unless
otherwise specified.

(c) (i) The term “documents” includes any and all instruments, documents,
agreements, certificates, indentures, notices and other writings, however
evidenced.

 

  34   Annex A

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

(ii) The term “including” is not limiting and means “including without
limitation.”

(iii) In the computation of periods of time from a specified date to a later
specified date, the word “from” means “from and including,” the words “to” and
“until” each mean “to but excluding” and the word “through” means “to and
including.”

(iv) The word “or” is not exclusive.

(d) Unless otherwise expressly provided herein, (i) references to agreements
(including the Agreement) and other contractual instruments shall be deemed to
include all subsequent amendments and other modifications thereto, but only to
the extent such amendments and other modifications are not prohibited by the
terms of any Loan Document, and (ii) references to any statute or regulation are
to be construed as including all statutory and regulatory provisions
consolidating, amending, replacing, supplementing or interpreting the statute or
regulation.

(e) The captions and headings of the Agreement and other Loan Documents are for
convenience of reference only and shall not affect the interpretation of the
Agreement.

(f) The Agreement and other Loan Documents may use several different
limitations, tests or measurements to regulate the same or similar matters. All
such limitations, tests and measurements are cumulative and shall each be
performed in accordance with their terms.

(g) For purposes of Section 9.1, a breach of the financial covenant contained in
Section 7.21 shall be deemed to have occurred as of any date of determination
thereof by the Agent or as of the last day of any specified measuring period,
regardless of when the Financial Statements reflecting such breach are delivered
to the Agent.

(h) The Agreement and the other Loan Documents are the result of negotiations
among and have been reviewed by counsel to the Agent, the Borrowers and the
other parties, and are the products of all parties. Accordingly, they shall not
be construed against the Lenders or the Agent merely because of the Agent’s or
Lenders’ involvement in their preparation.

 

  35   Annex A

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

EXHIBIT A

FORM OF NOTE

 

$                September     , 2011        

For Value Received, the undersigned (referred to herein as the “Borrowers”)
hereby jointly and severally promise to pay to the order of
                    (the “Lender”) in care of Bank of America, N.A. (the
“Agent”), at the Agent’s office located at 901 Main Street, Dallas, Texas,
75202, for the account of the Lender, the lesser of the principal amount of
                     ($            ) or the aggregate amount of all outstanding
Revolving Loans made to Borrowers by the Lender from time to time. The
undersigned also promise to pay interest on the unpaid principal amount of each
Borrowing from the date of such Borrowing until such principal amount is paid.
This Note shall be subject to the terms of that certain Credit Agreement
described below (the “Credit Agreement”), and all principal and interest payable
hereunder shall be due and payable in accordance with the terms of the Credit
Agreement.

This Note is the Note referred to in the Second Amended and Restated Credit
Agreement, dated as of September 16, 2011, among the Borrowers, the Lender,
certain other Lenders party thereto, and Bank of America, N.A., as Agent for the
Lenders, as amended, renewed, and refinanced from time to time. Terms defined in
the Credit Agreement are used herein with the same meanings. The Credit
Agreement, among other things, contains provisions for acceleration of the
maturity of this Note, upon the happening of certain stated events and also for
prepayments on account of the principal of this Note prior to the maturity of
this Note upon the terms and conditions specified in the Credit Agreement.
Without limiting the immediately preceding sentence, reference is made to
Section 2.3 of the Credit Agreement for usury savings provisions.

Principal and interest payments shall be in money of the United States of
America, lawful at such times for the satisfaction of public and private debts,
and shall be in immediately available funds.

The Borrowers jointly and severally promise to pay the costs of collection,
including reasonable attorney’s fees, if default is made in the payment of this
Note.

[This Note is in renewal and replacement, and not extinguishment, of the Amended
and Restated Note dated September 8, 2008 made by the original Borrowers under
the Existing Credit Agreement, payable to the order of the Lender and any
amendments and restatements thereof, which amended and restated the Note dated
July 31, 2003 made by the original Borrowers under the Credit Agreement dated
July 31, 2003, payable to the order of the Lender and any amendments and
restatements thereof.]

THIS NOTE AND THE OTHER LOAN DOCUMENTS HAVE BEEN ENTERED INTO PURSUANT TO
SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW AND THE SUBSTANTIVE LAWS
OF THE STATE OF NEW YORK, AND THE APPLICABLE FEDERAL LAWS OF THE UNITED STATES
OF AMERICA SHALL GOVERN THE VALIDITY, CONSTRUCTION, ENFORCEMENT, AND
INTERPRETATION HEREOF.

 

    Exhibit A

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

IN WITNESS WHEREOF, the undersigned have caused this Note to be executed by
officers thereunto duly authorized and directed by appropriate corporate
authority.

[Remainder of Page Intentionally Left Blank; Signatures Follow]

 

  2   Exhibit A

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

BORROWERS:   WESTLAKE CHEMICAL CORPORATION, a Delaware corporation   WESTLAKE
PVC CORPORATION, a Delaware corporation   WESTLAKE VINYLS, INC., a Delaware
corporation   WESTLAKE LONGVIEW CORPORATION, a Delaware corporation   WESTLAKE
ETHYLENE PIPELINE CORPORATION, a Delaware corporation   WESTLAKE SUPPLY AND
TRADING COMPANY, a Delaware corporation   By:  

 

    Albert Chao     President of the above Borrowers

 

  3   Exhibit A

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

NORTH AMERICAN PIPE CORPORATION, a Delaware corporation

WESTECH BUILDING PRODUCTS, INC.,

a Delaware corporation

By:  

 

  Robert F. Buesinger   President of the above Borrowers

 

  4   Exhibit A

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

WESTLAKE VINYLS COMPANY LP, a Delaware limited partnership By:   GVGP, Inc., its
general partner   By:  

 

    Albert Chao     President of the general partner of the above Borrower

WESTLAKE PETROCHEMICALS LLC,

a Delaware limited liability company

WESTLAKE POLYMERS LLC,

a Delaware limited liability company

WESTLAKE STYRENE LLC,

a Delaware limited liability company

WPT LLC, a Delaware limited liability company By:   Westlake Chemical
Investments, Inc., its manager By:  

 

  Albert Chao   President of the manager of the above Borrowers

 

  5   Exhibit A

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

EXHIBIT B

FORM OF BORROWING BASE CERTIFICATE

REPORTING DATE:

 

To: BANK OF AMERICA, N.A., individually as a Lender and as agent for itself and
the other Lenders (the “Agent”) under that certain Second Amended and Restated
Credit Agreement dated as of September 16, 2011 (such agreement, as it may be
amended, restated, or otherwise modified from time to time, the “Credit
Agreement”), by and among the Agent, Westlake Chemical Corporation and certain
of its domestic subsidiaries listed as Borrowers thereto (collectively, the
“Borrowers”), and the Lenders party thereto.

Reference is hereby made to the Credit Agreement, the terms defined therein
being used herein as therein defined. This Borrowing Base Certificate is
delivered pursuant to the terms of the Credit Agreement.

The undersigned hereby certifies and warrants to the Agent and the Lenders on
behalf of the Borrowers as follows:

(a) I am a duly qualified and acting Responsible Officer of Westlake, and I am
familiar with the financial statements and financial affairs of the Loan
Parties. I am authorized to execute this Borrowing Base Certificate on behalf of
the Loan Parties.

(a) Attached hereto as Schedule 1 are true and correct computations of the
Borrowing Base under the Credit Agreement as of the date set forth below.

The Borrowers further represent and warrant to the Agent and the Lenders that
the representations and warranties contained in Article VI of the Credit
Agreement are true and correct in all material respects on and as of the date of
this Borrowing Base Certificate as if made on and as of the date hereof (except
to the extent that such representations and warranties expressly refer to an
earlier date, in which case they shall be true and correct in all material
respects as of such earlier date and except to the extent that (a) the Agent and
the Lenders have been notified in writing by the Borrowers that any
representation or warranty is not correct and the Required Lenders have
explicitly waived in writing compliance with such representation or warranty or
(b) any representation or warranty has been qualified by the updated information
reflected in, and as permitted under, the Compliance Certificate submitted by
Westlake to the Agent periodically), and that no Event of Default or Default has
occurred and is continuing, except as disclosed in an attachment to this
Certificate.

IN WITNESS WHEREOF, Westlake has caused this Borrowing Base Certificate to be
executed and delivered on this      day of             , 20    .

 

WESTLAKE CHEMICAL CORPORATION, on its behalf and as agent for the other
Borrowers By:  

 

  Name:  

 

  Title:  

 

 

    Exhibit B

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

SCHEDULE 1

(See attached computations of the Borrowing Base)

 

  2   Exhibit B

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

EXHIBIT C

FORM OF OBLIGATION GUARANTY

SECOND AMENDED AND RESTATED OBLIGATION GUARANTY

THIS SECOND AMENDED AND RESTATED OBLIGATION GUARANTY (this “Guaranty”) is
executed as of September 16, 2011, jointly and severally by the undersigned
(each a “Guarantor” and collectively the “Guarantors”), for the benefit of BANK
OF AMERICA, N.A., a national banking association (in its capacity as Agent for
the benefit of Lenders (defined below)).

RECITALS

A. In connection with that certain Credit Agreement dated as of July 31, 2003,
by and among Westlake Chemical Corporation and certain of its direct and
indirect subsidiaries, Agent, and certain lenders, certain guarantors entered
into certain Obligation Guaranties (the “2003 Obligation Guaranties”).

B. In connection with that certain Amended and Restated Credit Agreement dated
as of September 8, 2008 by and among Westlake Chemical Corporation and certain
of its direct and indirect subsidiaries, Agent, and certain lenders (including
all annexes, exhibits, and schedules thereto, as from time to time amended,
restated, supplemented, or otherwise modified prior to the date hereof, the
“Existing Credit Agreement”), certain guarantors (“Existing Guarantors”) entered
into that certain Amended and Restated Obligation Guaranty dated as of
September 8, 2008 (as from time to time amended, restated, supplemented, or
otherwise modified prior to the date hereof, the “Existing Guaranty”), which
amended and restated the 2003 Obligation Guaranties.

C. (i) Certain existing guarantors have ceased to be in existence and will no
longer be Guarantors hereunder; (ii) certain existing guarantors will continue
to be Guarantors hereunder; and (iii) certain subsidiaries of Westlake Chemical
Corporation will become Guarantors pursuant to this Guaranty.

D. Westlake Chemical Corporation and certain of its direct and indirect
subsidiaries, Agent, and certain lenders are concurrently herewith entering into
a Second Amended and Restated Credit Agreement dated as of the date hereof
(including all annexes, exhibits, and schedules thereto, as from time to time
amended, restated, supplemented, or otherwise modified, the “Credit Agreement”).
In connection with the Credit Agreement, Guarantors have agreed to amend and
restate the Existing Guaranty, and to ratify, confirm, renew and extend the
Existing Guaranty in its entirety, without interruption, novation or discharge
as set forth herein.

ACCORDINGLY, for adequate and sufficient consideration, the receipt and adequacy
of which are hereby acknowledged, each Guarantor, jointly and severally
(together with any other Person that executes an Obligation Guaranty),
guarantees to Agent and Lenders the prompt payment of the Guaranteed Debt
(defined below) as follows:

1. DEFINITIONS. Terms defined in the Credit Agreement or in Annex A thereto have
the same meanings when used, unless otherwise defined, in this Guaranty. As used
in this Guaranty:

Agent is defined in the recitals to this Guaranty.

 

  1   Exhibit B

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

Borrowers means Borrowers, any Borrower as debtors-in-possession, and any
receiver, trustee, liquidator, conservator, custodian, or similar party
appointed for any Borrower or for all or substantially all of any Borrower’s
assets under any Debtor Relief Law.

Credit Agreement is defined in the recitals to this Guaranty.

Debtor Relief Law means the Bankruptcy Code of the United States of America and
all other applicable liquidation, conservatorship, bankruptcy, moratorium,
rearrangement, receivership, insolvency, reorganization, fraudulent transfer or
conveyance, suspension of payments, or similar laws from time to time in effect
affecting the rights of creditors generally.

Guaranteed Debt means, collectively, (a) the Obligations and (b) all present and
future costs, Attorney Costs, and expenses reasonably incurred by Agent or any
Lender to enforce any Borrower’s, any Guarantor’s, or any other obligor’s
payment of any of the Guaranteed Debt, including, without limitation (to the
extent lawful), all present and future amounts that would become due but for the
operation of §§ 502 or 506 or any other provision of Title 11 of the United
States Code and all present and future accrued and unpaid interest (including,
without limitation, all post-maturity interest and any post-petition interest in
any proceeding under Debtor Relief Laws to which any Borrower or any Guarantor
becomes subject).

Guarantor and Guarantors is defined in the preamble to this Guaranty.

Lender means, individually, or Lenders means, collectively, the Agent, the
Lenders, each Letter of Credit Issuer, and each Person that, at the date it
enters into a Hedge Agreement with a Loan Party, is a Lender or an Affiliate of
a Lender, and each Affiliate of a Lender that is a party to any Bank Product
with any Loan Party, but with respect to any Hedge Agreement or Bank Product, in
compliance with Section 7.23 of the Credit Agreement.

Subordinated Debt means, for each Guarantor, all present and future obligations
of any Loan Party to such Guarantor, whether those obligations are (a) direct,
indirect, fixed, contingent, liquidated, unliquidated, joint, several, or joint
and several, (b) due or to become due to such Guarantor, (c) held by or are to
be held by such Guarantor, (d) created directly or acquired by assignment or
otherwise, or (e) evidenced in writing.

2. GUARANTY. This is an absolute, irrevocable, and continuing guaranty of
payment, not collection, and the circumstance that at any time or from time to
time the Guaranteed Debt may be paid in full does not affect the obligation of
any Guarantor with respect to the Guaranteed Debt incurred after that. This
Guaranty remains in effect until the Guaranteed Debt is fully paid and performed
(other than Bank Products that the applicable Lender chooses not to terminate
and indemnity obligations that survive the termination of the Credit Agreement
and are not yet due and payable at such termination), all commitments to extend
any credit under the Loan Documents have terminated, all Letters of Credit which
have not been fully cash collateralized have expired or been terminated, and all
Hedge Agreements with any Lender have expired. No Guarantor may rescind or
revoke its obligations with respect to the Guaranteed Debt. Notwithstanding any
contrary provision, it is the intention of Guarantors, Lenders, and Agent that
the amount of the Guaranteed Debt guaranteed by Guarantors by this Guaranty
shall be, but not in excess of, the maximum amount permitted by fraudulent
conveyance, fraudulent transfer, or similar laws applicable to Guarantors.
Accordingly, notwithstanding anything to the contrary contained in this Guaranty
or any other agreement or instrument executed in connection with the payment of
any of the Guaranteed Debt, the amount of the Guaranteed Debt guaranteed by any
Guarantor by this Guaranty shall be limited to an aggregate amount equal to the
largest amount that would not render such Guarantor’s obligations hereunder
subject to avoidance under Section 548 of the United States Bankruptcy Code or
any comparable provision of any applicable state law.

 

  2   Exhibit B

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

3. CONSIDERATION. Each Guarantor represents and warrants that its liability
under this Guaranty may reasonably be expected to directly or indirectly benefit
it.

4. CUMULATIVE RIGHTS. If any Guarantor becomes liable for any indebtedness owing
by any Borrower to Agent or any Lender, other than under this Guaranty, that
liability shall not be in any manner impaired or affected by this Guaranty. The
rights of Agent or Lenders under this Guaranty are cumulative of any and all
other rights that Agent or Lenders may ever have against any Guarantor. The
exercise by Agent or Lenders of any right under this Guaranty or otherwise does
not preclude the concurrent or subsequent exercise of any other right.

5. PAYMENT UPON DEMAND. If an Event of Default exists, each Guarantor shall, on
demand and without further notice of dishonor and without any notice having been
given to any Guarantor previous to that demand of either the acceptance by Agent
or Lenders of this Guaranty or the creation or incurrence of any Guaranteed
Debt, pay the amount of the Guaranteed Debt then due and payable to Agent and
Lenders; provided that, if an Event of Default exists and Agent or Lenders
cannot, for any reason, accelerate the Obligations, then the Guaranteed Debt
shall be, as among Guarantors, Agent, and Lenders, a fully matured, due, and
payable obligation of Guarantors to Agent and Lenders. It is not necessary for
Agent or Lenders, in order to enforce that payment by any Guarantor, first or
contemporaneously to institute suit or exhaust remedies against any Borrower or
others liable on any Guaranteed Debt or to enforce rights against any Collateral
securing any Guaranteed Debt.

6. SUBORDINATION. The Subordinated Debt is expressly subordinated to the full
and final payment of the Guaranteed Debt. Each Guarantor agrees not to accept
any payment of any Subordinated Debt from any Loan Party if an Event of Default
exists. If any Guarantor receives any payment of any Subordinated Debt in
violation of the foregoing, such Guarantor shall hold that payment in trust for
Agent and Lenders and promptly turn it over to Agent, in the form received (with
any necessary endorsements), to be applied to the Guaranteed Debt.

7. SUBROGATION AND CONTRIBUTION. Until payment in full of the Guaranteed Debt,
the termination of the obligation of Lenders to extend credit under the Loan
Documents, and expiration of all Hedge Agreements between any Loan Party and any
Lender, (a) no Guarantor may assert, enforce, or otherwise exercise any right of
subrogation to any of the rights or Liens of Agent or Lenders or any other
beneficiary against any Borrower or any other obligor on the Guaranteed Debt or
any Collateral or other security or any right of recourse, reimbursement,
subrogation, contribution, indemnification, or similar right against any
Borrower or any other obligor on any Guaranteed Debt or any guarantor of it,
(b) each Guarantor defers all of the foregoing rights (whether they arise in
equity, under contract, by statute, under common law, or otherwise), and
(c) each Guarantor defers the benefit of, and subordinates any right to
participate in, any Collateral or other security given to Agent or Lenders or
any other beneficiary to secure payment of any Guaranteed Debt.

8. NO RELEASE. Guarantors’ obligations under this Guaranty shall not be
released, diminished, or affected by the occurrence of any one or more of the
following events: (a) any taking or accepting of any other security or assurance
for any Guaranteed Debt; (b) any release, surrender, exchange, subordination,
impairment, or loss of any Collateral securing any Guaranteed Debt; (c) any full
or partial release of the liability of any other obligor on any Guaranteed Debt,
except for any final release resulting from payment in full of such Guaranteed
Debt; (d) the modification of, or waiver of compliance with, any terms of any
other Loan Document; (e) the insolvency, bankruptcy, or lack of corporate or

 

  3   Exhibit B

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

partnership power of any other obligor at any time liable for any Guaranteed
Debt, whether now existing or occurring in the future; (f) any renewal,
extension, or rearrangement of any Guaranteed Debt or any adjustment,
indulgence, forbearance, or compromise that may be granted or given by Agent or
any Lender to any other obligor on any Guaranteed Debt; (g) any neglect, delay,
omission, failure, or refusal of Agent or any Lender to take or prosecute any
action in connection with the Guaranteed Debt or to foreclose, take, or
prosecute any action in connection with any Loan Document; (h) any failure of
Agent or any Lender to notify any Guarantor of any renewal, extension, or
assignment of any Guaranteed Debt, or the release of any security or of any
other action taken or refrained from being taken by Agent or any Lender against
any Borrower or any new agreement between Agent, any Lender, and any Borrower;
it being understood that neither Agent nor any Lender is required to give any
Guarantor any notice of any kind under any circumstances whatsoever with respect
to or in connection with any Guaranteed Debt, other than any notice required to
be given to any Guarantor by law or elsewhere in this Guaranty; (i) the
unenforceability of any Guaranteed Debt against any other obligor or any
security securing same because it exceeds the amount permitted by law, the act
of creating it is ultra vires, the officers creating it exceeded their authority
or violated their fiduciary duties in connection with it, or otherwise; or
(j) any payment of any Guaranteed Debt to Agent or any Lender is held to
constitute a preference under any Debtor Relief Law or for any other reason
Agent or any Lender is required to refund that payment or make payment to
someone else (and in each such instance this Guaranty will be reinstated in an
amount equal to that payment).

9. WAIVERS. By execution hereof, each Guarantor acknowledges and agrees to the
waivers set forth in Section 13.9 of the Credit Agreement. To the maximum extent
lawful, each Guarantor waives all rights by which it might be entitled to
require suit on an accrued right of action in respect of any Guaranteed Debt or
require suit against any Borrower or others.

10. LOAN DOCUMENTS. By execution hereof, each Guarantor covenants and agrees
that certain representations, warranties, terms, covenants, and conditions set
forth in the Loan Documents are applicable to Guarantors and shall be imposed
upon Guarantors, and each Guarantor reaffirms that each such representation and
warranty is true and correct and covenants and agrees to promptly and properly
perform, observe, and comply with each such term, covenant, or condition.
Moreover, each Guarantor acknowledges and agrees that this Guaranty is subject
to the offset provisions of the Loan Documents in favor of Agent and Lenders. In
the event the Credit Agreement or any other Loan Document shall cease to remain
in effect for any reason whatsoever during any period when any part of the
Guaranteed Debt remains unpaid, the terms, covenants, and agreements of the
Credit Agreement or such other Loan Document incorporated herein by reference
shall nevertheless continue in full force and effect as obligations of
Guarantors under this Guaranty.

11. RELIANCE AND DUTY TO REMAIN INFORMED. Each Guarantor confirms that it has
executed and delivered this Guaranty after reviewing the terms and conditions of
the Loan Documents and such other information as it has deemed appropriate in
order to make its own credit analysis and decision to execute and deliver this
Guaranty. Each Guarantor confirms that it has made its own independent
investigation with respect to Borrowers’ creditworthiness and is not executing
and delivering this Guaranty in reliance on any representation or warranty by
Agent or any Lender as to that creditworthiness. Each Guarantor expressly
assumes all responsibilities to remain informed of the financial condition of
Borrowers and any circumstances affecting Borrowers’ ability to perform under
the Loan Documents to which it is a party or any Collateral securing any
Guaranteed Debt.

12. NO REDUCTION. The Guaranteed Debt shall not be reduced, discharged, or
released because or by reason of any existing or future offset, claim, or
defense (except for the defense of complete and final payment of the Guaranteed
Debt) of any Borrower or any other obligor against Agent or any

 

  4   Exhibit B

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

Lender or against payment of the Guaranteed Debt, whether that offset, claim, or
defense arises in connection with the Guaranteed Debt or otherwise. Those claims
and defenses include, without limitation, failure of consideration, breach of
warranty, fraud, bankruptcy, incapacity/infancy, statute of limitations, lender
liability, accord and satisfaction, usury, forged signatures, mistake,
impossibility, frustration of purpose, and unconscionability.

13. INSOLVENCY OF GUARANTOR. Should any Guarantor become insolvent, or fail to
pay such Guarantor’s debts generally as they become due, or voluntarily seek,
consent to, or acquiesce in, the benefit or benefits of any Debtor Relief Law
(other than as a creditor or claimant), or become a party to (or be made the
subject of) any proceeding provided for by any Debtor Relief Law (other than as
a creditor or claimant) that could suspend or otherwise adversely affect the
rights of Agent or any Lender granted hereunder, then, in any such event, the
Guaranteed Debt shall be, as among such Guarantor, Agent and Lenders, a fully
matured, due, and payable obligation of such Guarantor to Agent and Lenders
(without regard to whether any Borrower is then in default under the Loan
Documents or whether the Obligations, or any part thereof, is then due and owing
by any Borrower to any Lender), payable in full by such Guarantor to Lenders
upon demand, and the amount thereof so payable shall be the estimated amount
owing in respect of the contingent claim created hereunder.

14. LOAN DOCUMENT. This Guaranty is a Loan Document and is subject to the
applicable provisions of Section 13 of the Credit Agreement, including, without
limitation, the provisions relating to GOVERNING LAW, CHOICE OF FORUM, SERVICE
OF PROCESS AND JURISDICTION, AND WAIVER OF JURY TRIAL, all of which are
incorporated into this Guaranty by reference the same as if set forth in this
Guaranty verbatim.

15. NOTICES. To be effective, notices required or permitted to be given under
this Guaranty must be in writing, shall be delivered as provided in Section 13.8
of the Credit Agreement to the address or facsimile number set forth on the
signature pages to this Guaranty, and shall be effective as provided in
Section 13.8 of the Credit Agreement.

16. AMENDMENTS, ETC. No amendment, waiver, or discharge to or under this
Guaranty is valid unless it is in writing and is signed by the party against
whom it is sought to be enforced.

17. AGENT AND LENDERS. Agent is Agent for each Lender under the Credit
Agreement. All rights granted to Agent under or in connection with this Guaranty
are for each Lender’s ratable benefit. Agent may, without the joinder of any
Lender, exercise any rights in Agent’s or Lenders’ favor under or in connection
with this Guaranty. Agent’s and each Lender’s rights and obligations vis-à-vis
each other may be subject to one or more separate agreements between those
parties. However, no Guarantor is required to inquire about any such agreement
or is subject to any terms of such agreement unless such Guarantor specifically
joins such agreement. Therefore, no Guarantor nor any of its successors or
assigns is entitled to any benefits or provisions of any such separate agreement
or is entitled to rely upon or raise as a defense any party’s failure or refusal
to comply with the provisions of such agreement.

18. PARTIES. This Guaranty benefits Agent, Lenders, and their respective
successors and assigns and binds Guarantors and their respective successors and
assigns. Upon appointment of any successor Agent under the Credit Agreement, all
of the rights of Agent under this Guaranty automatically vest in that new Agent
as successor Agent on behalf of Lenders without any further act, deed,
conveyance, or other formality other than that appointment. The rights of Agent
and Lenders under this Guaranty may be transferred with any assignment of the
Guaranteed Debt. The Credit Agreement contains provisions governing assignments
of the Guaranteed Debt and of rights and obligations under this Guaranty.

 

  5   Exhibit B

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

19. RESTATEMENT OF EXISTING GUARANTY. The Guarantors agree that: (a) the
Obligations represent, among other things, the restatement, renewal, amendment,
extension and modification of the “Obligations” (as defined in the Existing
Credit Agreement); (b) this Guaranty is intended to, and does hereby, restate,
renew, extend, amend, modify, supersede and replace but does not extinguish the
obligations, liabilities, and indebtedness arising under the Existing Guaranty
in its entirety; and (c) the entering into and performance of their respective
obligations under this Guaranty do not constitute a novation nor shall they be
deemed to have terminated, extinguished or discharged the obligations,
liabilities, and indebtedness under the Existing Guaranty, all of which shall
continue under and be governed by this Guaranty and the other Loan Documents,
except as expressly provided otherwise herein.

Remainder of Page Intentionally Blank.

Signature Page(s) to Follow.

 

  6   Exhibit B

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

EXECUTED as of the date first stated in this Guaranty.

 

GUARANTORS:   WESTLAKE CHEMICAL CORPORATION, a Delaware corporation   WESTLAKE
PVC CORPORATION, a Delaware corporation   WESTLAKE VINYLS, INC., a Delaware
corporation   WESTLAKE LONGVIEW CORPORATION, a Delaware corporation   WESTLAKE
ETHYLENE PIPELINE CORPORATION, a Delaware corporation   WESTLAKE SUPPLY AND
TRADING COMPANY, a Delaware corporation   By:  

 

    Albert Chao     President of each of the above Guarantors

 

    Exhibit C

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

NORTH AMERICAN PIPE CORPORATION, a Delaware corporation

WESTECH BUILDING PRODUCTS, INC.,

a Delaware corporation

By:  

 

  Robert F. Buesinger   President of each of the above Guarantors

 

    Exhibit C

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

WESTLAKE VINYLS COMPANY LP, a Delaware limited partnership By:   GVGP, Inc., its
general partner   By:  

 

    Albert Chao     President of the general partner of the above Guarantor
WESTLAKE GEISMAR POWER COMPANY LLC By:   Westlake Vinyls Company LP, its manager
By:   GVGP, Inc., its general partner By:  

 

  Albert Chao   President of the general partner of the manager of the above
Guarantor

WESTLAKE PETROCHEMICALS LLC,

a Delaware limited liability company

WESTLAKE POLYMERS LLC,

a Delaware limited liability company

WESTLAKE STYRENE LLC,

a Delaware limited liability company

WPT LLC, a Delaware limited liability company

WESTLAKE PIPELINE INVESTMENTS LLC, a Delaware limited liability company

By:   Westlake Chemical Investments, Inc., its manager By:  

 

  Albert Chao   President of the manager of each of the above Guarantors

 

    Exhibit C

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

GEISMAR HOLDINGS, INC., a Delaware corporation

WESTLAKE DEVELOPMENT CORPORATION,

a Delaware corporation

GVGP, INC., a Delaware corporation

WESTLAKE CHEMICAL INVESTMENTS, INC.,

a Delaware corporation

WESTLAKE MANAGEMENT SERVICES, INC.,

a Delaware corporation

WESTLAKE OLEFINS CORPORATION,

a Delaware corporation

WESTLAKE RESOURCES CORPORATION,

a Delaware corporation

WESTLAKE VINYL CORPORATION,

a Delaware corporation

WESTLAKE NG I CORPORATION,

a Delaware corporation

WESTLAKE NG IV CORPORATION,

a Delaware corporation

WESTLAKE NG V CORPORATION,

a Delaware corporation

By:  

 

  Albert Chao   President of each of the above Guarantors

 

    Exhibit C

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EXHIBIT D

FORM OF NOTICE OF BORROWING

 

Date:               , 20     To:   BANK OF AMERICA, N.A., individually as a
Lender and as agent for itself and the other Lenders (the “Agent”) under that
certain Second Amended and Restated Credit Agreement dated as of September 16,
2011 (such agreement, as it may be amended, restated, or otherwise modified from
time to time, the “Credit Agreement”), by and among the Agent, Westlake Chemical
Corporation and certain of its domestic subsidiaries listed as Borrowers thereto
(collectively, the “Borrowers”), and the Lenders party thereto.

Ladies and Gentlemen:

The undersigned, Westlake Chemical Corporation (“Westlake”), on its behalf and
as agent for the other Borrowers refers to the Credit Agreement, the terms
defined therein being used herein as therein defined, and hereby gives you
notice irrevocably of the Borrowing specified below:

 

1. The Business Day of the proposed Borrowing is                  , 20    .

 

2. The aggregate amount of the proposed Borrowing is $            .

 

3. The Borrowing is to be comprised of $             of Base Rate and
$             of LIBOR Rate Loans.

 

4. The duration of the Interest Period for the LIBOR Rate Loans, if any,
included in the Borrowing shall be              month[s].

 

5. Name of Borrower or Borrowers to receive all or any portion of the requested
Borrowing and the amount to be advanced to such Borrower or Borrowers:
                                        

The undersigned hereby certifies that the following statements are true on the
date hereof, and will be true on the date of the proposed Borrowing, before and
after giving effect thereto and to the application of the proceeds therefrom:

(a) The representations and warranties of the Loan Parties contained in the
Credit Agreement are true and correct as though made on and as of such date and
except to the extent that (i) the Agent and the Lenders have been notified in
writing by any Borrower that any representation or warranty is not correct and
the Required Lenders have explicitly waived in writing compliance with such
representation or warranty or (ii) any representation or warranty has been
qualified by the updated information reflected in, and as permitted under, the
Compliance Certificate submitted by Westlake to the Agent periodically;

(b) No Default or Event of Default has occurred and is continuing, or would
result from such proposed Borrowing; and

(c) The proposed Borrowing will not cause the aggregate principal amount of all
outstanding Revolving Loans plus the aggregate amount available for drawing
under all outstanding Letters of Credit, to exceed the Borrowing Base or the
Maximum Revolver Amount.

 

    Annex D

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

IN WITNESS WHEREOF, Westlake has caused this Notice of Borrowing to be executed
and delivered on this      day of             , 20    .

 

WESTLAKE CHEMICAL CORPORATION, on its behalf and as agent for the other
Borrowers By:  

 

  Name:  

 

  Title:  

 

 

  2   Exhibit D

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EXHIBIT E

FORM OF NOTICE OF CONTINUATION/CONVERSION

 

Date:               , 20     To:   BANK OF AMERICA, N.A., individually as a
Lender and as agent for itself and the other Lenders (the “Agent”) under that
certain Second Amended and Restated Credit Agreement dated as of September 16,
2011 (such agreement, as it may be amended, restated, or otherwise modified from
time to time, the “Credit Agreement”), by and among the Agent, Westlake Chemical
Corporation and certain of its domestic subsidiaries listed as Borrowers thereto
(collectively, the “Borrowers”), and the Lenders party thereto.

Ladies and Gentlemen:

The undersigned, Westlake Chemical Corporation (“Westlake”), on its behalf and
as agent for the other Borrowers refers to the Credit Agreement, the terms
defined therein being used herein as therein defined, and hereby gives you
notice irrevocably of the [conversion] [continuation] of the Revolving Loans
specified herein, that:

 

  1. The Continuation/Conversion Date is             , 20    .

 

  2. The aggregate amount of the Revolving Loans to be [converted] [continued]
is $            .

 

  3. The Revolving Loans are to be [converted into] [continued as] [LIBOR Rate]
[Base Rate] Loans.

 

  4. The duration of the Interest Period for the LIBOR Rate Loans included in
the [conversion] [continuation] shall be      month[s].

The undersigned hereby certifies that the following statements are true on the
date hereof, and will be true on the proposed Continuation/Conversion Date,
before and after giving effect thereto and to the application of the proceeds
therefrom:

The proposed conversion-continuation will not cause the aggregate principal
amount of all outstanding Revolving Loans plus the aggregate amount available
for drawing under all outstanding Letters of Credit to exceed the Borrowing Base
or the Maximum Revolver Amount.

IN WITNESS WHEREOF, Westlake has caused this Notice of Continuation/Conversion
to be executed and delivered on this      day of             , 20    .

 

WESTLAKE CHEMICAL CORPORATION, on its behalf and as agent for the other
Borrowers By:  

 

  Name:  

 

  Title:  

 

 

    Exhibit E

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EXHIBIT F

ASSIGNMENT AND ACCEPTANCE AGREEMENT

This ASSIGNMENT AND ACCEPTANCE AGREEMENT (this “Assignment and Acceptance”)
dated as of             , 20     is made between                      (the
“Assignor”) and                      (the “Assignee”).

RECITALS

WHEREAS, the Assignor is party to that certain Second Amended and Restated
Credit Agreement dated as of September 16, 2011 (as amended, amended and
restated, modified, supplemented, or renewed, the “Credit Agreement”) by and
among Westlake Chemical Corporation and certain of its domestic subsidiaries
listed as Borrowers thereto (collectively, the “Borrowers”), the several
financial institutions from time to time party thereto (including the Assignor,
the “Lenders”), and Bank of America, N.A., as agent for the Lenders (the
“Agent”). Any terms defined in the Credit Agreement and not defined in this
Assignment and Acceptance are used herein as defined in the Credit Agreement;

WHEREAS, as provided under the Credit Agreement, the Assignor has committed to
make Revolving Loans (the “Revolving Committed Loans”) to the Borrowers in an
aggregate amount not to exceed $             (the “Revolving Commitment”);

WHEREAS, the Assignor has made Revolving Committed Loans in the aggregate
principal amount of $             to the Borrowers;

WHEREAS, [the Assignor has acquired a participation in its pro rata share of the
Letter of Credit Issuers’ liabilities under Letters of Credit in an aggregate
principal amount of $             (the “L/C Obligations”)] [no Letters of Credit
are outstanding under the Credit Agreement]; and

WHEREAS, the Assignor wishes to assign to the Assignee [part of the] [all]
rights and obligations of the Assignor under the Credit Agreement in respect of
its Revolving Commitment, together with a corresponding portion of each of its
outstanding Revolving Committed Loans and L/C Obligations, in an aggregate
amount equal to $             (the “Assigned Amount”) on the terms and subject
to the conditions set forth herein and the Assignee wishes to accept assignment
of such rights and to assume such obligations from the Assignor on such terms
and subject to such conditions;

NOW, THEREFORE, in consideration of the foregoing and the mutual agreements
contained herein, the parties hereto agree as follows:

 

1. Assignment and Acceptance.

(a) Subject to the terms and conditions of this Assignment and Acceptance,
(i) the Assignor hereby sells, transfers, and assigns to the Assignee, and
(ii) the Assignee hereby purchases, assumes, and undertakes from the Assignor,
without recourse and without representation or warranty (except as provided in
this Assignment and Acceptance)     % (the “Assignee’s Percentage Share”) of
(A) the Revolving Commitment, the Revolving Committed Loans, and the L/C
Obligations of the Assignor and (B) all related rights, benefits, obligations,
liabilities, and indemnities of the Assignor under and in connection with the
Credit Agreement and the Loan Documents.

 

    Annex F

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

(b) With effect on and after the Effective Date (as defined in Section 5
hereof), the Assignee shall be a party to the Credit Agreement and succeed to
all of the rights and be obligated to perform all of the obligations of a Lender
under the Credit Agreement, including the requirements concerning
confidentiality and the payment of indemnification, with a Revolving Commitment
in an amount equal to the Assigned Amount. The Assignee agrees that it will
perform in accordance with their terms all of the obligations which by the terms
of the Credit Agreement are required to be performed by it as a Lender. It is
the intent of the parties hereto that the Revolving Commitment of the Assignor
shall, as of the Effective Date, be reduced by an amount equal to the Assigned
Amount, and the Assignor shall relinquish its rights and be released from its
obligations under the Credit Agreement to the extent such obligations have been
assumed by the Assignee; provided, however, the Assignor shall not relinquish
its rights under Sections 3.8, 4, and 13.11 of the Credit Agreement to the
extent such rights relate to the time prior to the Effective Date.

(c) After giving effect to the assignment and assumption set forth herein, on
the Effective Date the Assignee’s Revolving Commitment will be $             and
Revolving Committed Loans will be $            .

(d) After giving effect to the assignment and assumption set forth herein, on
the Effective Date the Assignor’s Revolving Commitment will be $             and
Revolving Committed Loans will be $            .

 

2. Payments.

(a) As consideration for the sale, assignment, and transfer contemplated in
Section 1 hereof, the Assignee shall pay to the Assignor on the Effective Date
in immediately available funds an amount equal to the purchase price agreed
between the Assignor and the Assignee for the Assigned Amount.

(b) The [Assignor] [Assignee] further agrees to pay to the Agent a processing
fee in the amount specified in Section 11.2(a) of the Credit Agreement.

 

3. Reallocation of Payments.

Any interest, fees, and other payments accrued to the Effective Date with
respect to the Revolving Commitment, Revolving Committed Loans, and L/C
Obligations shall be for the account of the Assignor. Any interest, fees, and
other payments accrued on and after the Effective Date with respect to the
Assigned Amount shall be for the account of the Assignee. Each of the Assignor
and the Assignee agrees that it will hold in trust for the other party any
interest, fees, and other amounts which it may receive to which the other party
is entitled pursuant to the preceding sentence and pay to the other party any
such amounts which it may receive promptly upon receipt.

 

4. Independent Credit Decision.

The Assignee (a) acknowledges that it has received a copy of the Credit
Agreement and the Schedules and Exhibits thereto, together with copies of the
most recent Financial Statements of the Loan Parties, and such other documents
and information as it has deemed appropriate to make its own credit and legal
analysis and decision to enter into this Assignment and Acceptance; and
(b) agrees that it will, independently and without reliance upon the Assignor,
the Agent, or any other Lender and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit and legal
decisions in taking or not taking action under the Credit Agreement.

 

  2   Exhibit F

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

5. Effective Date; Notices.

(a) As between the Assignor and the Assignee, the effective date for this
Assignment and Acceptance shall be             , 20     (the “Effective Date”);
provided that the following conditions precedent have been satisfied on or
before the Effective Date:

(i) this Assignment and Acceptance shall be executed and delivered by the
Assignor and the Assignee;

(ii) the consent of the Agent (if necessary) required for an effective
assignment of the Assigned Amount by the Assignor to the Assignee shall have
been duly obtained and shall be in full force and effect as of the Effective
Date;

(iii) the Assignee shall pay to the Assignor all amounts due to the Assignor
under this Assignment and Acceptance;

(iv) the Assignee shall have complied with Section 11.2 of the Credit Agreement
(if applicable);

(v) the processing fee referred to in Section 2(b) hereof and in Section 11.2(a)
of the Credit Agreement shall have been paid to the Agent; and

(b) Promptly following the execution of this Assignment and Acceptance, the
Assignor shall deliver to the Borrowers and the Agent for acknowledgment by the
Agent, a Notice of Assignment in the form attached hereto as Schedule 1.

 

6. Agent.

(a) The Assignee hereby appoints and authorizes the Agent to take such action as
agent on its behalf and to exercise such powers under the Credit Agreement as
are delegated to the Agent by the Lenders pursuant to the terms of the Credit
Agreement.

[INCLUDE (b) ONLY IF ASSIGNOR IS AGENT]

(b) [The Assignee shall assume no duties or obligations held by the Assignor in
its capacity as Agent under the Credit Agreement.]

 

7. Withholding Tax.

The Assignee (a) represents and warrants to the Agent and the Borrowers that
under applicable law and treaties no tax will be required to be withheld by the
Agent or the Borrowers with respect to any payments to be made to the Assignee
hereunder, (b) agrees to furnish (if it is organized under the laws of any
jurisdiction other than the United States or any State thereof) to the Agent and
the Borrowers prior to the time that the Agent or the Borrowers is required to
make any payment of principal, interest, or fees in respect of the interest
assigned hereunder, duplicate executed originals of either U.S. Internal Revenue
Service Form W-8ECI, U.S. Internal Revenue Service Form W-8BEN (wherein the
Assignee claims entitlement to the benefits of a tax treaty that provides for a
complete exemption from U.S. federal income withholding tax on all payments
hereunder), Form W-8IMY and all required supporting documents, or Form W-9 or
such other documentation or information prescribed by Requirement of Law (if the
Assignee is a “United States person” within the meaning of Section 7701(a)(30)
of the Code) and agrees to provide new Forms W-8ECI, W-8BEN, W-8IMY and all
required supporting documents, or W-9

 

  3   Exhibit F

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

or such other documentation or information prescribed by Requirement of Law upon
the expiration of any previously delivered form or comparable statements in
accordance with applicable U.S. law and regulations and amendments thereto, duly
executed and completed by the Assignee, and (c) agrees to comply with all
applicable U.S. laws and regulations with regard to such withholding tax
exemption.

 

8. Representations and Warranties.

(a) The Assignor represents and warrants that (i) it is the legal and beneficial
owner of the interest being assigned by it hereunder and that such interest is
free and clear of any Lien or other adverse claim; (ii) it is duly organized and
existing and it has the full power and authority to take, and has taken, all
action necessary to execute and deliver this Assignment and Acceptance and any
other documents required or permitted to be executed or delivered by it in
connection with this Assignment and Acceptance and to fulfill its obligations
hereunder; (iii) no notices to, or consents, authorizations, or approvals of,
any Person are required (other than any already given or obtained) for its due
execution, delivery, and performance of this Assignment and Acceptance, and
apart from any agreements or undertakings or filings required by the Credit
Agreement, no further action by, or notice to, or filing with, any Person is
required of it for such execution, delivery, or performance; and (iv) this
Assignment and Acceptance has been duly executed and delivered by it and
constitutes the legal, valid, and binding obligation of the Assignor,
enforceable against the Assignor in accordance with the terms hereof, subject,
as to enforcement, to bankruptcy, insolvency, moratorium, reorganization, and
other laws of general application relating to or affecting creditors’ rights and
to general equitable principles.

(b) The Assignor makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties, or representations
made in or in connection with the Credit Agreement or the execution, legality,
validity, enforceability, genuineness, sufficiency, or value of the Credit
Agreement or any other instrument or document furnished pursuant thereto. The
Assignor makes no representation or warranty in connection with, and assumes no
responsibility with respect to, the solvency, financial condition, or statements
of the Companies, or the performance or observance by any Loan Party of any of
its respective obligations under the Credit Agreement or any other instrument or
document furnished in connection therewith.

(c) The Assignee represents and warrants that (i) it is duly organized and
existing and it has full power and authority to take, and has taken, all action
necessary to execute and deliver this Assignment and Acceptance and any other
documents required or permitted to be executed or delivered by it in connection
with this Assignment and Acceptance, and to fulfill its obligations hereunder;
(ii) no notices to, or consents, authorizations, or approvals of, any Person are
required (other than any already given or obtained) for its due execution,
delivery, and performance of this Assignment and Acceptance; and apart from any
agreements or undertakings or filings required by the Credit Agreement, no
further action by, or notice to, or filing with, any Person is required of it
for such execution, delivery, or performance; (iii) this Assignment and
Acceptance has been duly executed and delivered by it and constitutes the legal,
valid, and binding obligation of the Assignee, enforceable against the Assignee
in accordance with the terms hereof, subject, as to enforcement, to bankruptcy,
insolvency, moratorium, reorganization, and other laws of general application
relating to or affecting creditors’ rights and to general equitable principles;
and (iv) it is an Eligible Assignee.

 

9. Further Assurances.

The Assignor and the Assignee each hereby agree to execute and deliver such
other instruments, and take such other action, as either party may reasonably
request in connection with the transactions

 

  4   Exhibit F

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

contemplated by this Assignment and Acceptance, including the delivery of any
notices or other documents or instruments to the Borrowers or the Agent, which
may be required in connection with the assignment and assumption contemplated
hereby.

 

10. Miscellaneous.

(a) Any amendment or waiver of any provision of this Assignment and Acceptance
shall be in writing and signed by the parties hereto. No failure or delay by
either party hereto in exercising any right, power, or privilege hereunder shall
operate as a waiver thereof and any waiver of any breach of the provisions of
this Assignment and Acceptance shall be without prejudice to any rights with
respect to any other or further breach thereof.

(b) All payments made hereunder shall be made without any set-off or
counterclaim.

(c) The Assignor and the Assignee shall each pay its own costs and expenses
incurred in connection with the negotiation, preparation, execution, and
performance of this Assignment and Acceptance.

(d) This Assignment and Acceptance may be executed in any number of counterparts
and all of such counterparts taken together shall be deemed to constitute one
and the same instrument.

(e) THIS ASSIGNMENT AND ACCEPTANCE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK. The Assignor and the Assignee
each irrevocably submits to the non-exclusive jurisdiction of any State or
Federal court sitting in Texas over any suit, action, or proceeding arising out
of or relating to this Assignment and Acceptance and irrevocably agrees that all
claims in respect of such action or proceeding may be heard and determined in
such Texas State or Federal court. Each party to this Assignment and Acceptance
hereby irrevocably waives, to the fullest extent it may effectively do so, the
defense of an inconvenient forum to the maintenance of such action or
proceeding.

(f) THE ASSIGNOR AND THE ASSIGNEE EACH HEREBY KNOWINGLY, VOLUNTARILY, AND
INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF
ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH
THIS ASSIGNMENT AND ACCEPTANCE, THE CREDIT AGREEMENT, ANY RELATED DOCUMENTS AND
AGREEMENTS, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, OR STATEMENTS (WHETHER
ORAL OR WRITTEN).

 

  5   Exhibit F

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

IN WITNESS WHEREOF, the Assignor and the Assignee have caused this Assignment
and Acceptance to be executed and delivered by their duly authorized officers as
of the date first above written.

 

[ASSIGNOR] By:  

 

Title:  

 

Address:  

 

[ASSIGNEE] By:  

 

Title:  

 

Address:  

 

 

  6   Exhibit F

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

SCHEDULE 1

to

ASSIGNMENT AND ACCEPTANCE

NOTICE OF ASSIGNMENT AND ACCEPTANCE

            , 20    

Bank of America, N.A, as Agent (as hereinafter defined)

901 Main Street

Dallas, Texas 75202

Attn: Portfolio Manager

Re: Westlake Chemical Corporation et al.

Ladies and Gentlemen:

We refer to the Second Amended and Restated Credit Agreement dated as of
September 16, 2011 (such agreement, as it may be amended, restated, or otherwise
modified from time to time, the “Credit Agreement”) by and among Westlake
Chemical Corporation and certain of its domestic subsidiaries listed as
Borrowers thereto (collectively, the “Borrowers”), the Lenders referred to
therein, and Bank of America, N.A., as agent for the Lenders (the “Agent”).
Terms defined in the Credit Agreement are used herein as therein defined.

 

1. We hereby give the Agent notice of, and request the Agent’s consent to, the
assignment by                      (the “Assignor”) to                      (the
“Assignee”) of     % of the right, title, and interest of the Assignor in and to
the Credit Agreement (including the right, title, and interest of the Assignor
in and to the Revolving Commitment of the Assignor to make Revolving Loans, all
outstanding Revolving Loans made by the Assignor, and the Assignor’s
participation in the Letters of Credit pursuant to the Assignment and Acceptance
Agreement attached hereto (the “Assignment and Acceptance”). We understand and
agree that the Assignor’s Revolving Commitment to make Revolving Loans, as of
                 , 20    , is $            , the aggregate amount of its
outstanding Revolving Loans is $            , and its participation in Letters
of Credit is $            .

 

2. The Assignee agrees that, upon receiving the consent of the Agent to such
assignment, the Assignee will be bound by the terms of the Credit Agreement as
fully and to the same extent as if the Assignee were the Lender originally
holding such interest in the Credit Agreement.

 

3. The following administrative details apply to the Assignee:

 

  (A) Notice Address:

 

Assignee name:  

 

  Address:  

 

  Attention:  

 

  Telephone:   (    )  

 

  Telecopier:   (    )  

 

  Telex (Answerback):  

 

 

 

  7   Exhibit F

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

  (B) Payment Instructions:

 

Account No.:  

 

  At:  

 

   

 

   

 

  Reference:  

 

  Attention:  

 

 

 

4. The Agent is entitled to rely upon the representations, warranties, and
covenants of each of the Assignor and Assignee contained in the Assignment and
Acceptance.

 

  8   Exhibit F

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

IN WITNESS WHEREOF, the Assignor and the Assignee have caused this Notice of
Assignment and Acceptance to be executed by their respective duly authorized
officials, officers, or agents as of the date first above mentioned.

 

  Very truly yours,   [NAME OF ASSIGNOR]   By:  

 

  Title:  

 

  [NAME OF ASSIGNEE]   By:  

 

  Title:  

 

 

[Consented to and]1 Accepted:  

Bank of America, N.A.,

as Agent

  By:  

 

  Name:  

 

  Title:  

 

  [Consented to:]2   [Westlake Chemical Corporation]   By:  

 

  Name:  

 

  Title:  

 

  ]

 

1 

To be added only if the consent of the Agent is required by the terms of the
Credit Agreement.

2 

To be added only if the consent of Westlake and/or other parties (e.g. Letter of
Credit Issuer) is required by the terms of the Credit Agreement.

 

  9   Exhibit F

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

EXHIBIT G

FORM OF COMPLIANCE CERTIFICATE

(Westlake Chemical Corporation et al.)

FOR             ENDED                     ,             

DATE:                     ,             

 

AGENT: Bank of America, N.A.

 

BORROWER: Westlake Chemical Corporation and certain of its domestic subsidiaries

 

 

This certificate is delivered under the Second Amended and Restated Credit
Agreement, dated as of September 16, 2011 (as amended, modified, supplemented,
or restated from time to time, the “Credit Agreement”), among Agent, Westlake
Chemical Corporation and certain of its domestic subsidiaries listed as
Borrowers thereto (collectively, the “Borrowers”), and the Lenders party
thereto. Capitalized terms used herein and not otherwise defined herein shall
have the meaning given to such terms in the Credit Agreement.

I certify to Agent and Lenders on behalf of the Loan Parties that:

(a) I am a Responsible Officer of the Loan Parties in the position(s) set forth
under my signature below;

(b) the Financial Statements of the Loan Parties attached to this certificate
were prepared in accordance with GAAP, and present fairly in all material
respects the consolidated, and, with respect to annual or quarterly Financial
Statements, consolidating, financial condition and results of operations of
Westlake and its Subsidiaries as of, and for the (             months, or fiscal
year) ended on,             ,         (the “Subject Period”) [(subject only to
normal year-end audit adjustments)];

(c) a review of the activities of the Loan Parties during the Subject Period has
been made under my supervision with a view to determining whether, during the
Subject Period, the Loan Parties have kept, observed, performed, and fulfilled
all of their respective obligations under the Loan Documents, and during the
Subject Period, (i) all of the representations and warranties of the Loan
Parties contained in the Credit Agreement and the other Loan Documents are
correct and complete in all material respects as at the date of this
certificate, except for those that speak as of a particular date, (ii) each of
the Loan Parties is, as of the date of this certificate, in compliance in all
material respects with all of its respective covenants and agreements in the
Credit Agreement and the other Loan Documents (except for the deviations, if
any, set forth on Annex A to this certificate), and (iii) no Event of Default
(nor any Default) exists as of the date of this certificate or existed during
the Subject Period and at the end of such period, which has not been cured or
waived (except the Defaults or Events of Defaults, if any, described on Annex A
to this Certificate);

(d) Annex B to this certificate sets forth in reasonable detail the calculation
of the Fixed Charge Coverage Ratio at the end of the Subject Period (for the
immediately preceding twelve (12) month period);

 

    Annex G

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

(e) to the extent any Collateral disposition occurred during the Subject Period,
all mandatory prepayments reductions required pursuant to Section 3.3 have been
made; and

(f) during the Subject Period, any revisions to Schedules 6.4, 6.5, 6.23 (to the
extent applicable), and 6.24 to the Credit Agreement or any Schedule or Annex to
each Collateral Document that was required to be revised and supplied to Agent
in accordance with the terms of the Loan Documents has been so revised and
supplied.

 

  2   Exhibit G

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

WESTLAKE CHEMICAL CORPORATION, on its behalf and as agent for the other Loan
Parties By:  

 

  Name:  

 

  Title:  

 

 

  3   Exhibit G

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

ANNEX A TO COMPLIANCE CERTIFICATE

DEVIATIONS FROM LOAN DOCUMENTS/ EVENTS OF DEFAULTS OR DEFAULTS

(If none, so state.)

 

  4   Exhibit G

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

ANNEX B TO COMPLIANCE CERTIFICATE

FIXED CHARGE COVERAGE RATIO CALCULATION

[Form to be Agreed to by Agent and Borrowers]

 

    Exhibit G