EXHIBIT 10.85

 

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AMENDED AND RESTATED

RECEIVABLES PURCHASE AGREEMENT

 

dated as of September 28, 2006

 

among

 

CHEMTURA CORPORATION

as Initial Collection Agent,

 

CHEMTURA CORPORATION,

CHEMTURA USA CORPORATION

GREAT LAKES CHEMICAL CORPORATION

and

BIO-LAB, INC.

as Sellers

 

and

 

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CROMPTON & KNOWLES RECEIVABLES CORPORATION

as Buyer

 

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TABLE OF CONTENTS

 

 

ARTICLE I

 

 

PURCHASE AND SALE

 

 

 

 

Section 1.1

Purchase and Sale

1

Section 1.2

Timing of Purchases

2

Section 1.3

Consideration for Purchases

3

Section 1.4

No Recourse

3

Section 1.5

No Assumption of Obligations Relating to Receivables, Related Assets or
Contracts

3

Section 1.6

True Sales

3

Section 1.7

Contribution of Receivables

4

 

 

 

 

ARTICLE II

 

 

CALCULATION OF PURCHASE PRICE

 

 

 

 

Section 2.1

Calculation of Purchase Price

4

Section 2.2

Definitions and Calculations Related to Purchase Price Percentage

5

 

 

 

 

ARTICLE III

 

 

PAYMENT OF PURCHASE PRICE; SERVICING, ETC.

 

 

 

 

Section 3.1

Purchase Price Payments

6

Section 3.2

The Buyer Notes

8

Section 3.3

Application of Collections and Other Funds

8

Section 3.4

Servicing of Receivables and Related Assets

9

Section 3.5

Adjustments for Noncomplying Receivables

9

Section 3.6

Payments and Computations Etc

9

Section 3.7

Letters of Credit; Extensions of Letters of Credit

10

 

 

 

 

ARTICLE IV

 

 

CONDITIONS TO PURCHASES

 

 

 

 

Section 4.1

Certification as to Representations and Warranties

10

Section 4.2

Effect of Payment of Purchase Price

11

 

 

 

 

ARTICLE V

 

 

REPRESENTATIONS AND WARRANTIES

 

 

 

 

Section 5.1

Representations and Warranties of the Sellers

11

 

 

 

 

ARTICLE VI

 

 

GENERAL COVENANTS OF THE SELLERS

 

 

 

 

Section 6.1

Affirmative Covenants

15

Section 6.2

Reporting Responsibilities

17

Section 6.3

Negative Covenants

19

 

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ARTICLE VII

 

 

ADDITIONAL RIGHTS AND OBLIGATIONS IN RESPECT OF THE SPECIFIED ASSETS

 

 

 

 

Section 7.1

Rights of Buyer

21

Section 7.2

Responsibilities of the Sellers

22

Section 7.3

Further Action Evidencing Purchases

22

Section 7.4

Collection of Receivables, Rights of Buyer and Its Assignees

23

 

 

 

 

ARTICLE VIII

 

 

TERMINATION

 

 

 

 

Section 8.1

Termination by the Sellers

23

Section 8.2

Automatic Termination

24

 

 

 

 

ARTICLE IX

 

 

INDEMNIFICATION

 

 

 

 

Section 9.1

Indemnities by the Seller

24

 

 

 

 

ARTICLE X

 

 

MISCELLANEOUS

 

 

 

 

Section 10.1

Amendments; Waivers, Etc

25

Section 10.2

Notices, Etc

26

Section 10.3

Cumulative Remedies

26

Section 10.4

Binding Effect; Assignability; Survival of Provisions

26

Section 10.5

Governing Law

27

Section 10.6

Costs, Expenses and Taxes

27

Section 10.7

Submission to Jurisdiction

27

Section 10.8

Waiver of Jury Trial

27

Section 10.9

Integration

28

Section 10.10

Counterparts

28

Section 10.11

Acknowledgment and Consent

28

Section 10.12

No Partnership or Joint Venture

29

Section 10.13

No Proceedings

29

Section 10.14

Severability of Provisions

29

Section 10.15

Recourse to Buyer

29

Section 10.16

Authorization to File Financing Statements

29

Section 10.17

Effect on Original Agreement

29

 

 

 

 

EXHIBITS

 

 

 

 

EXHIBIT A

Form of Buyer Note

 

EXHIBIT B

Form of Seller Assignment Certificate

 

EXHIBIT C

Form of Letter of Credit Request

 

 

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SCHEDULES

 

 

 

 

SCHEDULE 1

Litigation and Other Proceedings (Section 5.1(f))

 

SCHEDULE 2

Credit and Collection Policy (Section 5.1(4))

 

SCHEDULE 3

Offices of the Sellers where Records are Maintained (Section 5.1(n))

 

SCHEDULE 4

Legal Names, Trade Names and Names Under Which the Sellers Do Business
(Section 5.1(q))

 

 

 

 

 

APPENDICES

 

 

 

 

APPENDIX A

Definitions

 

 

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This AMENDED AND RESTATED RECEIVABLES PURCHASE AGREEMENT, dated as of
September 28, 2006 (this “Agreement” is made among CHEMTURA CORPORATION, a
Delaware corporation (“Chemtura”), as the Initial Collection Agent, Chemtura,
Chemtura USA Corporation (the “Parent”), Bio-Lab, Inc. and Great Lakes Chemical
Corporation, as sellers (each a “Seller” and collectively, the “Sellers”, and
CROMPTON & KNOWLES RECEIVABLES CORPORATION, a Delaware corporation (“Buyer”).
Except as otherwise defined herein, capitalized terms used in this Agreement
have the meanings assigned to them in Appendix A. This Agreement shall be
interpreted in accordance with the conventions set forth in Part B of such
Appendix A.

 

WHEREAS, pursuant to the Receivables Sale Agreement, Buyer intends to transfer
its interests in the Receivables sold pursuant hereto, together with Receivables
contributed to Buyer from time to time, to Amsterdam Funding Corporation,
Variable Funding Capital Company, LLC, Atlantic Asset Securitization LLC and the
Related Bank Purchasers in order to, among other things, finance its purchases
hereunder;

 

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto, intending to be legally
bound, agree as follows:

 

ARTICLE I
PURCHASE AND SALE

 

SECTION 1.1                 PURCHASE AND SALE.

 

(A)           PURSUANT TO THE TERMS OF THE ORIGINAL AGREEMENT, EACH SELLER
PREVIOUSLY SOLD, TRANSFERRED, ASSIGNED AND OTHERWISE CONVEYED TO THE BUYER,
PRIOR TO THE EFFECTIVE DATE, AND BUYER PURCHASED FROM EACH SELLER, ALL OF SUCH
SELLER’S RIGHT, TITLE AND INTEREST IN, TO AND UNDER:

 

(I)            ALL RECEIVABLES OF SUCH SELLER (OTHER THAN CONTRIBUTED
RECEIVABLES) THAT EXISTED AND WERE OWING TO SUCH SELLER AS AT THE CLOSING OF
SUCH SELLER’S BUSINESS ON THE INITIAL CUT-OFF DATE,

 

(II)           ALL RECEIVABLES CREATED BY SUCH SELLER (OTHER THAN CONTRIBUTED
RECEIVABLES) THAT ARISE DURING THE PERIOD FROM AND INCLUDING THE CLOSING OF SUCH
SELLER’S BUSINESS ON THE INITIAL  CUT-OFF DATE TO BUT EXCLUDING THE PURCHASE
TERMINATION DATE,

 

(III)          ALL RELATED SECURITY WITH RESPECT TO ALL RECEIVABLES (OTHER THAN
CONTRIBUTED RECEIVABLES) OF SUCH SELLER

 

(IV)          ALL COLLECTIONS AND OTHER PROCEEDS OF THE FOREGOING, INCLUDING ALL
FUNDS RECEIVED BY ANY PERSON IN PAYMENT OF ANY AMOUNTS OWED (INCLUDING INVOICE
PRICES, FINANCE CHARGES, INTEREST AND ALL OTHER CHARGES, IF ANY) IN RESPECT OF
ANY RECEIVABLE DESCRIBED ABOVE (OTHER THAN A CONTRIBUTED RECEIVABLE) OR RELATED
SECURITY WITH RESPECT TO ANY SUCH RECEIVABLE, OR OTHERWISE APPLIED TO REPAY OR
DISCHARGE ANY SUCH RECEIVABLE (INCLUDING INSURANCE PAYMENTS THAT A SELLER OR
INITIAL COLLECTION AGENT APPLIES IN THE ORDINARY COURSE OF ITS BUSINESS TO
AMOUNTS OWED IN RESPECT OF ANY SUCH RECEIVABLE AND NET PROCEEDS OF ANY SALE OR
OTHER DISPOSITION OF REPOSSESSED GOODS THAT WERE THE SUBJECT OF

 

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ANY SUCH RECEIVABLE) OR OTHER COLLATERAL OR PROPERTY OF ANY OBLIGOR OR ANY OTHER
PERSON DIRECTLY OR INDIRECTLY LIABLE FOR PAYMENT OF SUCH RECEIVABLES, AND

 

(V)           ALL RECORDS RELATING TO ANY OF THE FOREGOING.

 

ALL SUCH SALES, TRANSFERS, ASSIGNMENTS AND CONVEYANCES ARE HEREBY RATIFIED AND
CONFIRMED.

 

(B)           EACH SELLER HEREBY SELLS, TRANSFER, ASSIGNS, SETS OVER AND
OTHERWISE CONVEYS TO BUYER AND BUYER HEREBY PURCHASES FROM EACH SELLER, AT THE
TIMES SET FORTH IN SECTION 1.2 OCCURRING SUBSEQUENT TO THE EFFECTIVE DATE, ALL
OF SUCH SELLER’S RIGHT, TITLE AND INTEREST IN, TO AND UNDER:

 

(I)            ALL RECEIVABLES OF SUCH SELLER (OTHER THAN CONTRIBUTED
RECEIVABLES) THAT EXISTED AND WERE OWING TO SUCH SELLER AS AT THE CLOSING OF
SUCH SELLER’S BUSINESS ON THE INITIAL CUT-OFF DATE,

 

(II)           ALL RECEIVABLES CREATED BY SUCH SELLER (OTHER THAN CONTRIBUTED
RECEIVABLES) THAT ARISE DURING THE PERIOD FROM AND INCLUDING THE CLOSING OF SUCH
SELLER’S BUSINESS ON THE INITIAL  CUT-OFF DATE TO BUT EXCLUDING THE PURCHASE
TERMINATION DATE,

 

(III)          ALL RELATED SECURITY WITH RESPECT TO ALL RECEIVABLES (OTHER THAN
CONTRIBUTED RECEIVABLES) OF SUCH SELLER,

 

(IV)          ALL COLLECTIONS AND OTHER PROCEEDS OF THE FOREGOING, INCLUDING ALL
FUNDS RECEIVED BY ANY PERSON IN PAYMENT OF ANY AMOUNTS OWED (INCLUDING INVOICE
PRICES, FINANCE CHARGES, INTEREST AND ALL OTHER CHARGES, IF ANY) IN RESPECT OF
ANY RECEIVABLE DESCRIBED ABOVE (OTHER THAN A CONTRIBUTED RECEIVABLE) OR RELATED
SECURITY WITH RESPECT TO ANY SUCH RECEIVABLE, OR OTHERWISE APPLIED TO REPAY OR
DISCHARGE ANY SUCH RECEIVABLE (INCLUDING INSURANCE PAYMENTS THAT A SELLER OR
INITIAL COLLECTION AGENT APPLIES IN THE ORDINARY COURSE OF ITS BUSINESS TO
AMOUNTS OWED IN RESPECT OF ANY SUCH RECEIVABLE AND NET PROCEEDS OF ANY SALE OR
OTHER DISPOSITION OF REPOSSESSED GOODS THAT WERE THE SUBJECT OF ANY SUCH
RECEIVABLE) OR OTHER COLLATERAL OR PROPERTY OF ANY OBLIGOR OR ANY OTHER PERSON
DIRECTLY OR INDIRECTLY LIABLE FOR PAYMENT OF SUCH RECEIVABLES, AND

 

(V)           ALL RECORDS RELATING TO ANY OF THE FOREGOING.

 

As used herein, (i) “Purchased Receivables” means the items listed above in
clauses (a) and (b) (ii) “Related Purchased Assets” means the items listed above
in clauses (c), (d), (e), and (f), (iii) “Related Assets” means the Related
Purchased Assets and the Related Contributed Assets, (iv) “Purchased Assets”
means the Purchased Receivables and the Related Purchased Assets, and
(v) “Specified Assets” means the Purchased Receivables, the Contributed
Receivables and the Related Assets.

 

SECTION 1.2                 TIMING OF PURCHASES.  EXCEPT TO THE EXTENT OTHERWISE
PROVIDED IN SECTION 8.2, ON OR AFTER THE EFFECTIVE DATE UNTIL THE CLOSING OF
SUCH SELLER’S BUSINESS ON THE BUSINESS DAY IMMEDIATELY PRECEDING THE PURCHASE
TERMINATION DATE, EACH AND EVERY RECEIVABLE AND THE RELATED ASSETS OF EACH
SELLER SHALL BE SOLD AUTOMATICALLY TO BUYER PURSUANT HERETO IMMEDIATELY (AND
WITHOUT FURTHER ACTION BY ANY PERSON) UPON THE CREATION OF SUCH RECEIVABLE;

 

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PROVIDED HOWEVER, THAT NO SUCH PURCHASE SHALL OCCUR ON ANY BUSINESS DAY
OCCURRING ON OR AFTER THE EFFECTIVE DATE IF, AFTER GIVING EFFECT TO SUCH
PURCHASE AND THE PURCHASE PRICE TO BE PAID IN CONNECTION WITH SUCH PURCHASE, THE
NET WORTH OF THE BUYER, CALCULATED AFTER GIVING EFFECT TO ANY CONTRIBUTION TO
CAPITAL TO BE MADE BY THE PARENT TO THE BUYER ON SUCH BUSINESS DAY, WOULD BE
LESS THAN THE REQUIRED CAPITAL AMOUNT.

 

SECTION 1.3                 CONSIDERATION FOR PURCHASES.  ON THE TERMS AND
SUBJECT TO THE CONDITIONS SET FORTH IN THIS AGREEMENT, BUYER AGREES TO MAKE
PURCHASE PRICE PAYMENTS TO THE SELLERS IN ACCORDANCE WITH ARTICLE III.

 

SECTION 1.4                 NO RECOURSE.  EXCEPT AS SPECIFICALLY PROVIDED IN
THIS AGREEMENT, THE SALE AND PURCHASE OF PURCHASED ASSETS, AND THE TRANSFER AND
ASSIGNMENT OF THE CONTRIBUTED ASSETS, UNDER THIS AGREEMENT SHALL BE WITHOUT
RECOURSE TO THE SELLERS; IT BEING UNDERSTOOD THAT EACH SELLER SHALL BE LIABLE TO
BUYER FOR ALL REPRESENTATIONS, WARRANTIES, COVENANTS AND INDEMNITIES MADE BY
SUCH SELLER PURSUANT TO THE TERMS OF THIS AGREEMENT, ALL OF WHICH OBLIGATIONS
ARE LIMITED SO AS NOT TO CONSTITUTE RECOURSE TO SUCH SELLER FOR THE CREDIT RISK
OF THE OBLIGORS.

 

SECTION 1.5                 NO ASSUMPTION OF OBLIGATIONS RELATING TO
RECEIVABLES, RELATED ASSETS OR CONTRACTS.  NONE OF BUYER, THE INITIAL COLLECTION
AGENT NOR THE AGENT SHALL HAVE ANY OBLIGATION OR LIABILITY TO ANY OBLIGOR OR
OTHER CUSTOMER OR CLIENT OF A SELLER (INCLUDING ANY OBLIGATION TO PERFORM ANY OF
THE OBLIGATIONS OF SUCH SELLER UNDER ANY RECEIVABLE, RELATED CONTRACTS OR ANY
OTHER RELATED PURCHASE ORDERS OR OTHER AGREEMENTS). NO SUCH OBLIGATION OR
LIABILITY IS INTENDED TO BE ASSUMED BY BUYER. THE INITIAL COLLECTION AGENT OR
THE AGENT HEREUNDER, AND ANY ASSUMPTION IS EXPRESSLY DISCLAIMED.

 

SECTION 1.6                 TRUE SALES.  THE SELLERS AND BUYER INTEND THE
TRANSFERS OF PURCHASED ASSETS AND CONTRIBUTED ASSETS HEREUNDER TO BE TRUE SALES
OR CONTRIBUTIONS TO CAPITAL, RESPECTIVELY, BY THE SELLERS TO BUYER THAT ARE
ABSOLUTE AND IRREVOCABLE AND THAT PROVIDE BUYER WITH THE FULL BENEFITS OF
OWNERSHIP OF THE RECEIVABLES, AND NONE OF THE SELLERS NOR BUYER INTENDS THE
TRANSACTIONS CONTEMPLATED HEREUNDER TO BE, OR FOR ANY PURPOSE TO BE
CHARACTERIZED AS, LOANS FROM BUYER TO ANY SELLER.

 

It is further, not the intention of Buyer or any Seller that the conveyance of
the Specified Assets by such Seller be deemed a grant of a security interest in
the Specified Assets by such Seller to Buyer to secure a debt or other
obligation of such Seller. However, in the event that, notwithstanding the
intent of the parties, any Specified Assets are property of any Seller’s estate,
then (i) this Agreement also shall be deemed to be and hereby is a security
agreement within the meaning of the UCC, and (ii) the conveyance by such Seller
provided for in this Agreement shall be deemed to be a grant by such Seller to
Buyer of, and such Seller hereby grants to Buyer, a security interest in and to
all of such Seller’s right, title and interest in, to and under the Specified
Assets, whether now or hereafter existing or created, to secure (1) the rights
of Buyer hereunder, (2) a loan by Buyer to such Seller in the amount of the
related Purchase Price of the Purchased Assets sold by it, or the Unpaid Balance
of any Contributed Receivables and the related Contributed Assets, as the case
may be and (3) without limiting the foregoing, the payment and performance of
such Seller’s obligations (whether monetary or otherwise) hereunder. Each Seller
and Buyer shall, to the extent consistent with this Agreement, take such actions
as may be necessary to ensure that, if this Agreement were deemed to create a
security interest in the

 

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Specified Assets, such security interest would be deemed to be a perfected
security interest of first priority (subject to Permitted Adverse Claims) in
favor of Buyer or under applicable law and will be maintained as such throughout
the term of this Agreement.

 

SECTION 1.7                 CONTRIBUTION OF RECEIVABLES.  (A)  THE PARENT MAY,
IN ITS SOLE DISCRETION, FROM TIME TO TIME, TRANSFER TO BUYER, AS A CONTRIBUTION
TO THE CAPITAL OF BUYER, ALL ITS RIGHT, TITLE AND INTEREST IN, TO AND UNDER:

 

(I)            SUCH RECEIVABLES OF THE PARENT THAT THE PARENT MAY FROM TIME TO
TIME DESIGNATE IN A PERIODIC REPORT AS PART OF A CONTRIBUTION TO THE CAPITAL OF
BUYER (COLLECTIVELY, THE “CONTRIBUTED RECEIVABLES”),

 

(II)           ALL RELATED SECURITY WITH RESPECT TO THE CONTRIBUTED RECEIVABLES,

 

(III)          ALL COLLECTIONS AND OTHER PROCEEDS OF THE FOREGOING. INCLUDING
ALL FUNDS RECEIVED BY ANY PERSON IN PAYMENT OF ANY AMOUNTS OWED (INCLUDING
INVOICE PRICES, FINANCE CHARGES, INTEREST AND ALL OTHER CHARGES, IF ANY OTHER
THAN SALES TAX) IN RESPECT OF ANY CONTRIBUTED RECEIVABLE, OR RELATED SECURITY
WITH RESPECT TO ANY SUCH CONTRIBUTED RECEIVABLE, OR OTHERWISE APPLIED TO REPAY
OR DISCHARGE ANY SUCH CONTRIBUTED RECEIVABLE (INCLUDING INSURANCE PAYMENTS THAT
THE PARENT OR THE INITIAL COLLECTION AGENT APPLIES IN THE ORDINARY COURSE OF ITS
BUSINESS TO AMOUNTS OWED IN RESPECT OF ANY SUCH CONTRIBUTED RECEIVABLE AND NET
PROCEEDS OF ANY SALE OR OTHER DISPOSITION OF REPOSSESSED GOODS THAT WERE THE
SUBJECT OF ANY SUCH CONTRIBUTED RECEIVABLE) OR OTHER COLLATERAL OR PROPERTY OF
ANY OBLIGOR OR ANY OTHER PARTY DIRECTLY OR INDIRECTLY LIABLE FOR PAYMENT OF SUCH
CONTRIBUTED RECEIVABLES, AND

 

(IV)          ALL RECORDS RELATING TO ANY OF THE FOREGOING (THE ITEMS LISTED
ABOVE IN CLAUSES (II), (III) AND (IV) BEING REFERRED TO HEREIN AS THE “RELATED
CONTRIBUTED ASSETS”).

 

The value of the capital contribution attributable to each Contributed
Receivable and its Related Contributed Assets shall be an aggregate amount equal
to the Unpaid Balance of such Contributed Receivable as of the Cut-Off Date
immediately preceding the applicable date of contribution (or, in the case of
contributions deemed to occur pursuant to Section 3.1, equal to the portion of
the Unpaid Balance of the Receivables so contributed).

 

(B)           THE PARENT WILL BE AUTOMATICALLY DEEMED TO HAVE ELECTED, WITHOUT
THE NEED FOR ANY FURTHER ACTION, TO MAKE A CONTRIBUTION TO THE CAPITAL OF THE
BUYER ON ANY BUSINESS DAY THAT IT IS TRANSFERRING RECEIVABLES TO THE BUYER
(A) FOR WHICH THE PARENT HAS REQUESTED OR WILL REQUIRE ISSUANCE OF A LETTER OF
CREDIT, AND (B) AFTER GIVING EFFECT TO ANY CAPITAL CONTRIBUTION MADE PURSUANT TO
CLAUSE (A), TO THE EXTENT NECESSARY SO THAT AFTER GIVING EFFECT TO SUCH CAPITAL
CONTRIBUTION, THE BUYER MAINTAINS A NET WORTH AT LEAST EQUAL TO THE REQUIRED
CAPITAL AMOUNT THEN IN EFFECT.

 

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ARTICLE II
CALCULATION OF PURCHASE PRICE

 

SECTION 2.1                 CALCULATION OF PURCHASE PRICE.

 

(A)           ON OR BEFORE THE TWENTIETH DAY OF EACH MONTH, THE INITIAL
COLLECTION AGENT SHALL DELIVER TO BUYER AND THE AGENT A PERIODIC REPORT WITH
RESPECT TO BUYER’S PURCHASES OF RECEIVABLES FROM THE SELLERS, THAT WERE MADE
DURING THE IMMEDIATELY PRECEDING CALENDAR CYCLE.

 

(B)           ON EACH DAY WHEN RECEIVABLES ARE PURCHASED BY BUYER FROM A SELLER
PURSUANT TO ARTICLE I, THE “PURCHASE PRICE” TO BE PAID TO SUCH SELLER ON SUCH
DAY FOR THE PURCHASED RECEIVABLES AND RELATED PURCHASED ASSETS THAT ARE TO BE
SOLD BY SUCH SELLER ON SUCH DAY SHALL BE DETERMINED IN ACCORDANCE WITH THE
FOLLOWING FORMULA:

 

PP =        AUB x PPP

 

where:

 

PP =                    the aggregate Purchase Price for the Purchased
Receivables and Related Purchased Assets to be purchased from such Seller on
such day.

 

AUB =                the Aggregate Unpaid Balance of the Purchased Receivables
that are to be purchased from such Seller on such day.  “Aggregate Unpaid
Balance” shall mean the sum of the Unpaid Balance of each Receivable to be
purchased from such Seller on such day, calculated at the time of the
Receivable’s sale to Buyer.

 

PPP =                  the Purchase Price Percentage applicable to the
Receivables to be purchased from such Seller on such day, as determined pursuant
to Section 2.2.

 

SECTION 2.2                 DEFINITIONS AND CALCULATIONS RELATED TO PURCHASE
PRICE PERCENTAGE.

 

(a)           “Purchase Price Percentage” for the Receivables to be sold by a
Seller on any day during a Distribution Period shall mean the percentage
determined in accordance with the following formula:

 

PPP =      100% - (LP + PD + DR)

 

where:

 

PPP =                  the Purchase Price Percentage in effect during such
Distribution Period.

 

LP =                    a loss percentage of three quarters of one percent
(.75%), as such amount may be increased, on a prospective basis only, by the
Buyer and each Seller from time to time.

 

PD =                   a profit discount equal to one quarter of one percent
(.25%), as such amount may be increased, on a prospective basis only, by the
Buyer and each Seller from time to time.

 

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DR =                   a discount percentage equal to the product of (a) 1.5,
multiplied by (b) the rate announced by ABN AMRO Bank N.V. as its “Prime Rate”
plus 100 basis points (1.00%), multiplied by (c) the average Turnover Rate then
used in the calculation of the Discount Reserve under the Receivables Sale
Agreement.

 

ARTICLE III
PAYMENT OF PURCHASE PRICE; SERVICING, ETC.

 

SECTION 3.1                 PURCHASE PRICE PAYMENTS.  (A) ON THE BUSINESS DAY
FOLLOWING EACH DAY ON WHICH ANY RECEIVABLES AND RELATED PURCHASED ASSETS ARE
PURCHASED BY BUYER PURSUANT TO ARTICLE I ON THE TERMS AND SUBJECT TO THE
CONDITIONS OF THIS AGREEMENT, BUYER SHALL PAY TO THE SELLERS THE PURCHASE PRICE
(AS ADJUSTED IN ACCORDANCE WITH THIS SECTION 3.1) FOR THE RECEIVABLES AND
RELATED PURCHASED ASSETS PURCHASED ON SUCH DAY BY BUYER FROM THE SELLERS BY: 
(I) MAKING A CASH PAYMENT TO THE SELLERS TO THE EXTENT THAT BUYER HAS CASH
AVAILABLE TO MAKE THE PAYMENT PURSUANT TO SECTION 3.3 AND (II) IF THE PURCHASE
PRICE TO BE PAID FOR THE RECEIVABLES AND RELATED ASSETS OF ANY SELLER EXCEEDS
THE AMOUNT OF ANY CASH PAYMENT FOR THE ACCOUNT OF SUCH SELLER PURSUANT TO CLAUSE
(I), THEN BY INCREASING THE PRINCIPAL AMOUNT OUTSTANDING UNDER THE RELEVANT
BUYER NOTES BY THE AMOUNT OF THE EXCESS OR OTHERWISE ELECTS.

 

The obligation of Buyer to pay to each Seller the Purchase Price for Receivables
that has been deferred pursuant to clause (ii) in the preceding paragraph shall
be evidenced by the Buyer Notes issued to such Seller. Each Seller agrees that,
prior to the Seller Maturity Date, Buyer shall be required to make payments in
respect of the payment obligations evidenced by the Buyer Notes only to the
extent that it has cash available under Section 3.3.

 

(B)           ON THE LAST DAY OF EACH CALENDAR CYCLE, THE “NONCOMPLYING
RECEIVABLES ADJUSTMENT” FOR EACH SELLER SHALL BE EQUAL TO THE DIFFERENCE
(WHETHER THE DIFFERENCE IS POSITIVE OR NEGATIVE) BETWEEN (I) THE AGGREGATE
SELLER NONCOMPLYING RECEIVABLES ADJUSTMENTS IN RESPECT OF SUCH SELLER, IF ANY,
FOR THE IMMEDIATELY PRECEDING CALENDAR CYCLE, AS SHOWN IN THE PERIODIC REPORT
FOR SUCH CALENDAR CYCLE, AS SUCH AMOUNT IS DETERMINED PURSUANT TO SECTION 3.5
MINUS (II) THE AMOUNT OF THE PAYMENTS (IF ANY) THAT BUYER SHALL HAVE RECEIVED
DURING SUCH CALENDAR CYCLE FROM SUCH SELLER ON ACCOUNT OF ANY SELLER
NONCOMPLYING RECEIVABLES THAT HAD BEEN THE SUBJECT OF AN EARLIER SELLER
NONCOMPLYING RECEIVABLES ADJUSTMENT. IF THE NONCOMPLYING RECEIVABLES ADJUSTMENT
FOR ANY SELLER IS POSITIVE FOR ANY CALENDAR CYCLE, BUYER SHALL REDUCE THE
PURCHASE PRICE PAYABLE TO SUCH SELLER ON SUCH DAY PURSUANT TO SUBSECTION
(A) ABOVE BY THE AMOUNT OF THE NONCOMPLYING RECEIVABLES ADJUSTMENT. IF INSTEAD
THE NONCOMPLYING  RECEIVABLES ADJUSTMENT FOR ANY SELLER IS NEGATIVE FOR ANY
CALENDAR CYCLE, BUYER SHALL INCREASE THE PURCHASE PRICE PAYABLE TO SUCH SELLER
PURSUANT TO SUBSECTION (A) ABOVE ON SUCH DAY BY THE AMOUNT OF THE NONCOMPLYING
RECEIVABLES ADJUSTMENT.

 

(C)           IF FOR ANY CALENDAR CYCLE THE SELLER NONCOMPLYING RECEIVABLES
ADJUSTMENTS IN RESPECT OF ANY SELLER (AS DETERMINED PURSUANT TO SECTION 3.5),
LESS ANY AMOUNTS IN CLAUSE (B)(II) RELATING TO THE RECEIVABLES OF SUCH SELLER,
EXCEEDS THE PURCHASE PRICE PAYABLE BY BUYER TO SUCH SELLER PURSUANT TO
SUBSECTION (A) ABOVE ON SUCH DAY, OR IT SUCH DAY FALLS ON OR AFTER THE PURCHASE
TERMINATION DATE, THEN THE PRINCIPAL AMOUNT OF SUCH SELLER’S BUYER NOTE SHALL BE
REDUCED AUTOMATICALLY BY THE AMOUNT OF SUCH EXCESS.

 

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(D)           IF, ON ANY DAY PRIOR TO THE PURCHASE TERMINATION DATE, THE
PRINCIPAL AMOUNT OF A SELLER’S BUYER NOTE IS ZERO AND SUCH SELLER IS NOT A
TERMINATING SELLER, THEN THE AMOUNT OF THE EXCESS OF THE SELLER NONCOMPLYING
RECEIVABLES ADJUSTMENTS IN RESPECT OF SUCH SELLER (AS DETERMINED PURSUANT TO
SECTION 3.5), LESS ANY AMOUNTS IN CLAUSE (B)(II) RELATING TO THE RECEIVABLES OF
SUCH SELLER ON SUCH DAY OVER THE PURCHASE PRICE PAYABLE BY BUYER TO SUCH SELLER
ON SUCH DAY PURSUANT TO SUBSECTION (A) ABOVE (THE “PURCHASE PRICE CREDIT”) SHALL
BE CREDITED AGAINST THE PURCHASE PRICE PAYABLE BY BUYER FOR SUBSEQUENT PURCHASES
BY BUYER OF RECEIVABLES AND RELATED ASSETS FROM SUCH SELLER. IF ANY SUCH
PURCHASE PRICE CREDIT HAS NOT BEEN FULLY APPLIED ON OR PRIOR TO THE TENTH
BUSINESS DAY (OR A MUTUALLY AGREED UPON EARLIER DAY) AFTER THE CREATION OF SUCH
PURCHASE PRICE CREDIT, THEN, ON THE BUSINESS DAY THAT FOLLOWS THE END OF THE
TENTH BUSINESS DAY (OR SHORTER) PERIOD, SUCH SELLER SHALL PAY TO BUYER IN CASH
THE REMAINING UNAPPLIED AMOUNT OF THE PURCHASE PRICE CREDIT.

 

(E)           IF, ON ANY DAY ON OR AFTER THE PURCHASE TERMINATION DATE, OR, WITH
RESPECT TO ANY SELLER, THE DATE SUCH SELLER BECOMES A TERMINATING SELLER, THE
PRINCIPAL AMOUNT OF ANY SELLER’S BUYER NOTE HAS BEEN REDUCED TO ZERO, AN AMOUNT
EQUAL TO THE SELLER NONCOMPLYING RECEIVABLES ADJUSTMENTS, IF ANY, IN RESPECT OF
SUCH SELLER (AS DETERMINED PURSUANT TO SECTION 3.5), LESS ANY AMOUNTS IN CLAUSE
(B)(II) RELATING TO SUCH SELLER’S RECEIVABLES, SHALL BE PAID BY SUCH SELLER TO
BUYER IN CASH ON THE NEXT SUCCEEDING BUSINESS DAY.

 

(F)            IF, ON ANY DAY, THE AMOUNTS, IF ANY, RELATING TO ANY SELLER’S
RECEIVABLES PURSUANT TO CLAUSE (B)(II) ABOVE EXCEEDS THE SELLER NONCOMPLYING
RECEIVABLES ADJUSTMENTS, IF ANY, IN RESPECT OF SUCH SELLER (AS DETERMINED
PURSUANT TO SECTION 3.5) FOR SUCH DAY, THEN BUYER SHALL EITHER (I) PAY INITIAL
COLLECTION AGENT (FOR THE ACCOUNT OF SUCH SELLER) IN CASH THE AMOUNT OF SUCH
EXCESS, OR (II) IF BUYER DOES NOT HAVE SUFFICIENT CASH TO PAY SUCH AMOUNT IN
FULL, INCREASE THE PRINCIPAL AMOUNT OF SUCH SELLER’S BUYER NOTE BY THE AMOUNT OF
SUCH EXCESS THAT IS NOT PAID IN CASH TO INITIAL COLLECTION AGENT.

 

(G)           AMOUNTS RECEIVED BY THE INITIAL COLLECTION AGENT PURSUANT TO THIS
SECTION 3.1 SHALL BE ALLOCATED AMONG THE SELLERS IN ACCORDANCE WITH SECTION 3.3,
AND THE SELLER NONCOMPLYING RECEIVABLES ADJUSTMENTS IN RESPECT OF EACH SUCH
SELLER (AS DETERMINED PURSUANT TO SECTION 3.5). THE INITIAL COLLECTION AGENT
SHALL MAINTAIN A BOOKKEEPING ACCOUNT (THE “SELLER ACCOUNT”) FOR PURPOSES OF
TRACKING:

 

(I)            THE PURCHASE PRICE PAYABLE TO EACH SELLER IN RESPECT OF
RECEIVABLES SOLD BY IT TO BUYER (INCLUDING THE EXTENT TO WHICH CASH AND NON-CASH
PAYMENTS MADE BY BUYER SHOULD BE ALLOCATED TO EACH SELLER),

 

(II)           THE EXTENT TO WHICH SUCH PURCHASE PRICE SHOULD BE REDUCED ON
ACCOUNT OF SUCH SELLER’S SELLER NONCOMPLYING RECEIVABLES ADJUSTMENTS (INCLUDING
ANY ALLOCATION OF A PURCHASE PRICE CREDIT),

 

(III)          THE EXTENT TO WHICH PAYMENTS (WHETHER CASH OR NON-CASH) BY BUYER
IN RESPECT OF A NEGATIVE NONCOMPLYING RECEIVABLES ADJUSTMENT SHOULD BE ALLOCATED
TO EACH SELLER, AND

 

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(IV)          CASH PAYMENTS MADE TO AND BY EACH SELLER IN RESPECT OF THE ITEMS
DESCRIBED ABOVE.

 

The Initial Collection Agent shall maintain sufficient records with respect to
the Seller Account such that, on any day, it would be able to calculate each of
the items set forth above. Intercompany accounts among Sellers resulting from
the items described above will be settled in accordance with the intercompany
cash management system customarily employed by the Parent and its Subsidiaries.

 

SECTION 3.2                 THE BUYER NOTES.  (A) BUYER HAS DELIVERED TO EACH
SELLER A PROMISSORY NOTE, SUBSTANTIALLY IN THE FORM OF EXHIBIT A, PAYABLE TO THE
ORDER OF SUCH SELLER (EACH SUCH PROMISSORY, NOTE, AS THE SAME MAY BE AMENDED,
AMENDED AND RESTATED, SUPPLEMENTED, ENDORSED OR OTHERWISE MODIFIED FROM TIME TO
TIME, TOGETHER WITH ANY PROMISSORY NOTE ISSUED FROM TIME TO TIME IN SUBSTITUTION
THEREFOR OR RENEWAL THEREOF IN ACCORDANCE WITH THE TRANSACTION DOCUMENTS, BEING
HEREIN CALLED A “BUYER NOTE”), THAT IS SUBORDINATED TO ALL AMOUNTS PAYABLE BY
THE BUYER TO THE PURCHASERS PURSUANT TO THE RECEIVABLES SALE AGREEMENT.  THE
PRINCIPAL BALANCE OF EACH BUYER NOTE SHALL BE INCREASED IN ACCORDANCE WITH THE
PROVISIONS OF SECTION 3.1 HEREOF AND SHALL BE DECREASED IN (I) THE AMOUNT OF
FUNDS RECEIVED BY EACH SELLER PURSUANT TO SECTION 3.3 HEREOF AND (II) BY THE
SELLER NONCOMPLYING RECEIVABLES ADJUSTMENT OF SUCH SELLER IN ACCORDANCE WITH THE
PROVISIONS OF SECTION 3.1 HEREOF.  EACH BUYER NOTE IS PAYABLE IN FULL ON THE
DATE (THE “SELLER MATURITY DATE”) THAT IS ONE YEAR AND ONE DAY AFTER THE DATE ON
WHICH ALL INVESTMENTS (AS DEFINED IN THE RECEIVABLES SALE AGREEMENT) AND OTHER
AMOUNTS THEN DUE AND OWING BY THE BUYER TO THE PURCHASERS UNDER THE TRANSACTION
DOCUMENTS HAVE BEEN PAID IN FULL. BUYER MAY PREPAY ALL OR PART OF THE
OUTSTANDING BALANCE OF ANY BUYER NOTE FROM TIME TO TIME WITHOUT ANY PREMIUM OR
PENALTY, UNLESS THE PREPAYMENT WOULD RESULT IN A DEFAULT IN BUYER’S PAYMENT OF
ANY OTHER AMOUNT REQUIRED TO BE PAID BY IT UNDER ANY TRANSACTION DOCUMENT.

 

(B)           THE INITIAL COLLECTION AGENT (OR ITS DESIGNEE) SHALL HOLD ALL
BUYER NOTES FOR THE BENEFIT OF THE SELLERS AND SHALL MAKE ALL APPROPRIATE
RECORDKEEPING ENTRIES WITH RESPECT TO THE BUYER NOTES OR OTHERWISE TO REFLECT
THE PAYMENTS ON AND ADJUSTMENT OF THE BUYER NOTES. THE INITIAL COLLECTION
AGENT’S BOOKS AND RECORDS SHALL CONSTITUTE REBUTTABLE PRESUMPTIVE EVIDENCE OF
THE PRINCIPAL AMOUNT OF AND ACCRUED INTEREST ON EACH BUYER NOTE AT ANY TIME.
EACH SELLER HEREBY IRREVOCABLY AUTHORIZES AND DIRECTS THE INITIAL COLLECTION
AGENT TO MARK ITS BUYER NOTE “CANCELLED” AND RETURN IT TO BUYER UPON THE FINAL
PAYMENT THEREOF.

 

SECTION 3.3                 APPLICATION OF COLLECTIONS AND OTHER FUNDS.  IF, ON
ANY DAY, BUYER (OR, THE INITIAL COLLECTION AGENT, ON BEHALF OF THE BUYER)
RECEIVES (I) PROCEEDS OF TRANSFERS PURSUANT TO THE RECEIVABLES SALE AGREEMENT OR
(II) PURCHASER COLLECTIONS AND/OR SELLER COLLECTIONS, IN EACH CASE PURSUANT TO
THE RECEIVABLES SALE AGREEMENT, BUYER SHALL APPLY THE FUNDS AS FOLLOWS:

 

(A)           FIRST, TO PAY ITS EXISTING EXPENSES AND TO SET ASIDE FUNDS FOR THE
PAYMENT OF EXPENSES THAT ARE THEN ACCRUED (IN EACH CASE TO THE EXTENT SUCH
EXPENSES ARE PERMITTED TO EXIST UNDER THE RECEIVABLES SALE AGREEMENT),

 

(B)           SECOND, TO PAY THE PURCHASE PRICE PURSUANT TO SECTION 3.1 FOR
RECEIVABLES AND RELATED ASSETS PURCHASED BY BUYER FROM THE SELLERS ON SUCH DAY,
SUCH PAYMENT TO BE

 

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MADE ON A PRO RATA BASIS TO THE SELLER BASED ON THE PURCHASE PRICE THEN PAYABLE
TO EACH SUCH SELLER, AND

 

(C)           THIRD, TO PAY THE FOLLOWING AMOUNTS:  (A) TO PAY AMOUNTS OWED BY
BUYER TO THE SELLERS UNDER THE BUYER NOTES ON A PRO RATA BASIS BASED ON THE THEN
UNPAID PRINCIPAL BALANCE OF THE BUYER NOTES, (B) TO PAY AMOUNTS TO THE SELLERS
OWED PURSUANT TO SECTION 3.1(F) ON A PRO RATA BASIS BASED ON THE THEN UNPAID
AMOUNTS OWING TO ALL SELLERS PURSUANT TO SECTION 3.1(F), OR (C) TO DECLARE AND
PAY DIVIDENDS TO THE PARENT TO THE EXTENT PERMITTED BY LAW.

 

SECTION 3.4                 SERVICING OF RECEIVABLES AND RELATED ASSETS. 
CONSISTENT WITH BUYER’S OWNERSHIP OF THE RECEIVABLES AND THE RELATED ASSETS, AS
BETWEEN THE PARTIES TO THIS AGREEMENT, BUYER SHALL HAVE THE SOLE RIGHT TO
SERVICE, ADMINISTER AND COLLECT THE RECEIVABLES AND TO ASSIGN AND/OR DELEGATE
THE RIGHT TO OTHERS. WITHOUT LIMITING THE GENERALITY OF SECTION 10.11, EACH
SELLER HEREBY ACKNOWLEDGES AND AGREES THAT BUYER SHALL ASSIGN TO THE AGENT ON
BEHALF OF THE PURCHASERS THE RIGHTS AND INTERESTS OF BUYER HEREUNDER AND AGREES
TO COOPERATE FULLY WITH THE INITIAL COLLECTION AGENT (AND ANY SUCCESSOR THERETO
APPOINTED IN ACCORDANCE WITH THE RECEIVABLES SALE AGREEMENT), THE AGENT, THE
PURCHASER AGENTS AND THE PURCHASERS IN THE EXERCISE OF SUCH RIGHTS.

 

SECTION 3.5                 ADJUSTMENTS FOR NONCOMPLYING RECEIVABLES.  IF AT ANY
TIME ANY OF THE BUYER, INITIAL COLLECTION AGENT, THE AGENT, ANY OF THE PURCHASER
AGENTS, ANY OF THE PURCHASERS, OR A SELLER SHALL DETERMINE THAT (I) ANY
RECEIVABLE HAS BEEN REDUCED AS THE RESULT OF ANY DISPUTE, CLAIM, OFFSET OR
DEFENSE (OTHER THAN DISCHARGE IN BANKRUPTCY OF THE OBLIGOR) OF THE OBLIGOR TO
THE PAYMENT OF ANY RECEIVABLE, OR ANY OTHER CLAIM RESULTING FROM THE SALE OR
LEASE OF GOODS OR THE RENDERING OF SERVICES RELATED TO SUCH RECEIVABLE OR THE
FURNISHING OR FAILURE TO FURNISH ANY GOODS OR SERVICES OR OTHER SIMILAR CLAIM OR
DEFENSE NOT ARISING FROM THE FINANCIAL INABILITY OF ANY OBLIGOR TO PAY
UNDISPUTED INDEBTEDNESS, (II) ANY OF THE REPRESENTATIONS AND WARRANTIES MADE BY
THE RELATED SELLER IN SECTION 5.1 WITH RESPECT TO ANY RECEIVABLE ORIGINATED BY
SUCH SELLER WAS NOT TRUE ON THE DATE OF THE PURCHASE THEREOF BY BUYER OR THE
DATE OF CONTRIBUTION THEREOF TO BUYER, OR (III) WITHOUT DUPLICATION OF THE
AMOUNTS SET FORTH IN CLAUSE (I) AND (II), ANY NOTICE OF DIFFERENCE HAS BEEN
DELIVERED WITH RESPECT TO ANY RECEIVABLE TRANSFERRED BY SUCH SELLER, THEN, IN
EACH SUCH CASE, ANY PURCHASE PRICE PAYABLE TO SUCH SELLER SHALL BE REDUCED BY AN
AMOUNT EQUAL TO (X) IN THE CASE OF CLAUSE (I) OR CLAUSE (III), THE AMOUNT OF
SUCH WHOLE OR PARTIAL REDUCTION AND (Y) IN THE CASE OF CLAUSE (II), THE UNPAID
BALANCE OF EACH SUCH AFFECTED RECEIVABLE (THE SUM OF THE AMOUNTS IN CLAUSES
(X) AND (Y) FOR SUCH SELLER ON ANY DAY BEING CALLED THE “SELLER NONCOMPLYING
RECEIVABLES ADJUSTMENT” FOR SUCH SELLER FOR SUCH DAY), AND SUCH SELLER
NONCOMPLYING RECEIVABLES ADJUSTMENT SHALL BE SETTLED IN THE MANNER PROVIDED FOR
IN SECTION 3.1.

 

SECTION 3.6                 PAYMENTS AND COMPUTATIONS ETC.  (A) ALL AMOUNTS TO
BE PAID BY A SELLER TO BUYER HEREUNDER SHALL BE PAID IN ACCORDANCE WITH THE
TERMS HEREOF NO LATER THAN 1:00 P.M. NEW YORK CITY TIME, ON THE DAY WHEN DUE IN
DOLLARS IN IMMEDIATELY AVAILABLE FUNDS TO AN ACCOUNT THAT BUYER SHALL FROM TIME
TO TIME SPECIFY IN WRITING. PAYMENTS RECEIVED BY BUYER AFTER SUCH TIME SHALL BE
DECRIED TO HAVE BEEN RECEIVED ON THE NEXT BUSINESS DAY. IN THE EVENT THAT ANY
PAYMENT BECOMES DUE ON A DAY THAT IS NOT A BUSINESS DAY, THEN THE PAYMENT SHALL
BE MADE ON THE NEXT BUSINESS DAY. EACH SELLER SHALL, TO THE EXTENT PERMITTED BY
LAW, PAY TO BUYER ON DEMAND, INTEREST ON ALL AMOUNTS NOT PAID WHEN DUE HEREUNDER
AT 2% PER ANNUM ABOVE THE INTEREST RATE ON THE APPLICABLE BUYER NOTE IN EFFECT
ON THE DATE THE PAYMENT WAS DUE; PROVIDED, HOWEVER, THAT THE

 

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INTEREST RATE SHALL NOT AT ANY TIME EXCEED THE MAXIMUM RATE PERMITTED BY
APPLICABLE LAW.  ALL COMPUTATIONS OF INTEREST PAYABLE HEREUNDER SHALL BE MADE ON
THE BASIS OF A YEAR OF 360 DAYS FOR THE ACTUAL NUMBER OF DAYS (INCLUDING THE
FIRST BUT EXCLUDING THE LAST DAY) ELAPSED.

 

(B)           ALL AMOUNTS TO BE PAID BY BUYER TO A SELLER HEREUNDER SHALL BE
PAID TO INITIAL COLLECTION AGENT (FOR THE ACCOUNT OF THE APPLICABLE SELLER) NO
LATER THAN 2:00 P.M. NEW YORK CITY TIME, ON THE DAY WHEN DUE IN DOLLARS IN
IMMEDIATELY AVAILABLE FUNDS TO AN ACCOUNT THAT THE INITIAL COLLECTION AGENT
SHALL FROM TIME TO TIME SPECIFY IN WRITING. PAYMENTS RECEIVED BY INITIAL
COLLECTION AGENT AFTER SUCH TIME SHALL BE DEEMED TO HAVE BEEN RECEIVED ON THE
NEXT BUSINESS DAY. INITIAL COLLECTION AGENT SHALL PROMPTLY REMIT PAYMENTS
RECEIVED BY IT IN IMMEDIATELY AVAILABLE FUNDS TO SUCH ACCOUNT AS THE APPLICABLE
SELLER SHALL FROM TIME TO TIME SPECIFY IN WRITING.  IN THE EVENT THAT ANY
PAYMENT BECOMES DUE ON A DAY THAT IS NOT A BUSINESS DAY, THEN SUCH PAYMENT SHALL
BE MADE ON THE NEXT BUSINESS DAY.

 

SECTION 3.7                 LETTERS OF CREDIT; EXTENSIONS OF LETTERS OF CREDIT. 
FROM TIME TO TIME PRIOR TO THE TERMINATION DATE:

 

(A)           PRIOR TO THE TERMINATION DATE, THE PARENT MAY DELIVER TO THE BUYER
ON OR PRIOR TO THE DATE ON WHICH THE PARENT WILL CONTRIBUTE TO THE CAPITAL OF
THE BUYER TO OBTAIN SUCH LETTER OF CREDIT A COMPLETED LETTER OF CREDIT REQUEST
REQUESTING THE ISSUANCE OF A LETTER OF CREDIT FOR THE BENEFIT OF THE PARENT
PURSUANT TO THE RECEIVABLES SALE AGREEMENT RELATED TO A CONTRIBUTION TO CAPITAL
OF RECEIVABLES BY THE PARENT TO THE BUYER.

 

(B)           LETTERS OF CREDIT MAY BE AUTOMATICALLY EXTENDED BY THEIR TERMS,
WHEREUPON THE PARENT SHALL PAY TO THE BUYER THE APPLICABLE LC COMMISSION (WHICH
PAYMENT MAY BE MADE IN CASH, BY REDUCTION OF THE OUTSTANDING BALANCE OF THE
BUYER NOTE OWING TO THE PARENT, OR THROUGH REDUCTION OF THE PURCHASE PRICE
OTHERWISE PAYABLE TO THE PARENT ON SUCH DATE BY THE BUYER PURSUANT TO THIS
AGREEMENT).

 

(C)           IN ADDITION TO AUTOMATIC EXTENSIONS DESCRIBED IN SECTION 3.7(B),
THE PARENT MAY REQUEST THAT THE BUYER ARRANGE FOR THE EXTENSION OF A LETTER OF
CREDIT WITH A FIXED EXPIRATION DATE, WHEREUPON THE BUYER SHALL ARRANGE FOR THE
EXTENSION OF THE EXPIRATION DATE OF SUCH LETTER OF CREDIT, AND THE BUYER SHALL
OBTAIN AND DELIVER SUCH EXTENSION.  IF THE APPLICABLE LC ISSUER AGREES TO SUCH
EXTENSION, THE PARENT SHALL PAY THE BUYER THE LC COMMISSION (WHICH PAYMENT MAY
BE MADE IN CASH, BY REDUCTION OF THE OUTSTANDING BALANCE OF THE BUYER NOTE OWING
TO THE PARENT, OR THROUGH REDUCTION OF THE PURCHASE PRICE OTHERWISE PAYABLE TO
THE PARENT ON SUCH DATE BY THE BUYER PURSUANT TO THIS AGREEMENT).

 

ARTICLE IV
CONDITIONS TO PURCHASES

 

SECTION 4.1                 CERTIFICATION AS TO REPRESENTATIONS AND WARRANTIES. 
EACH SELLER, BY ACCEPTING THE PURCHASE PRICE PAID FOR EACH PURCHASE, SHALL BE
DEEMED TO HAVE CERTIFIED, WITH RESPECT TO THE RECEIVABLES AND RELATED ASSETS TO
BE SOLD BY IT ON SUCH DAY, THAT ITS REPRESENTATIONS AND WARRANTIES CONTAINED IN
ARTICLE V ARE TRUE AND CORRECT ON AND AS OF SUCH DAY, WITH THE SAME EFFECT AS
THOUGH MADE ON AND AS OF SUCH DAY.

 

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SECTION 4.2                 EFFECT OF PAYMENT OF PURCHASE PRICE.  UPON THE
PAYMENT OF THE PURCHASE PRICE (WHETHER IN CASH, BY AN INCREASE IN A BUYER NOTE,
OR BY ISSUANCE OF A LETTER OF CREDIT, IN EACH CASE PURSUANT TO SECTION 3.1) FOR
ANY PURCHASE, TITLE TO THE RECEIVABLES AND THE RELATED ASSETS INCLUDED IN THE
PURCHASE SHALL VEST IN BUYER, WHETHER OR NOT THE CONDITIONS PRECEDENT TO THE
PURCHASE WERE IN FACT SATISFIED; PROVIDED, HOWEVER, THAT BUYER SHALL NOT BE
DEEMED TO HAVE WAIVED ANY CLAIM IT MAY HAVE UNDER THIS AGREEMENT FOR THE FAILURE
BY A SELLER IN FACT TO SATISFY ANY SUCH CONDITION PRECEDENT.

 

ARTICLE V
REPRESENTATIONS AND WARRANTIES

 

SECTION 5.1                 REPRESENTATIONS AND WARRANTIES OF THE SELLERS.  IN
ORDER TO INDUCE BUYER TO ENTER INTO THIS AGREEMENT AND TO MAKE PURCHASES
HEREUNDER, EACH SELLER HEREBY MAKES, WITH RESPECT TO ITSELF, THE REPRESENTATIONS
AND WARRANTIES SET FORTH IN THIS SECTION AT THE TIMES AND TO THE EXTENT SET
FORTH IN SECTION 4.2 (IT BEING UNDERSTOOD THAT ONLY THE PARENT MAKES THE
REPRESENTATIONS AND WARRANTIES SET FORTH BELOW WITH RESPECT TO THE CONTRIBUTED
RECEIVABLES, IF ANY, AND RELATED ASSETS WITH RESPECT THERETO).

 

(A)           CORPORATE EXISTENCE AND POWER. THE SELLER IS A CORPORATION DULY
ORGANIZED, VALIDLY EXISTING AND IN GOOD STANDING, UNDER THE LAWS OF ITS STATE OF
INCORPORATION AND HAS ALL CORPORATE POWER AND AUTHORITY AND ALL GOVERNMENTAL
LICENSES, AUTHORIZATIONS, CONSENTS AND APPROVALS REQUIRED TO CARRY ON ITS
BUSINESS IN EACH JURISDICTION IN WHICH ITS BUSINESS IS NOW CONDUCTED, EXCEPT
WHERE, FAILURE TO OBTAIN SUCH LICENSE, AUTHORIZATION, CONSENT OR APPROVAL WOULD
NOT HAVE A MATERIAL ADVERSE EFFECT ON (I) ITS ABILITY TO PERFORM ITS OBLIGATIONS
UNDER, OR THE ENFORCEABILITY OF, ANY TRANSACTION DOCUMENT, (II) ITS BUSINESS OR
FINANCIAL CONDITION, (III) THE INTERESTS OF THE PURCHASER AGENTS OR ANY
PURCHASER UNDER ANY TRANSACTION DOCUMENT OR (IV) THE ENFORCEABILITY OR
COLLECTIBILITY OF ANY RECEIVABLE.

 

(B)           CORPORATE AUTHORIZATION AND NO CONTRAVENTION.  THE EXECUTION,
DELIVERY AND PERFORMANCE BY THE SELLER OF EACH TRANSACTION DOCUMENT TO WHICH IT
IS A PARTY (I) ARE WITHIN ITS CORPORATE POWERS, (II) HAVE BEEN DULY AUTHORIZED
BY ALL NECESSARY CORPORATE ACTION, (III) DO NOT CONTRAVENE OR CONSTITUTE A
DEFAULT UNDER (A) ANY APPLICABLE LAW, RULE OR REGULATION, (B) ITS OR ANY
SUBSIDIARY’S CHARTER OR BY-LAWS OR (C) ANY AGREEMENT, ORDER OR OTHER INSTRUMENT
TO WHICH IT OR ANY SUBSIDIARY IS A PARTY OR ITS PROPERTY IS SUBJECT AND
(IV) WILL NOT RESULT IN ANY ADVERSE CLAIM ON ANY RECEIVABLE OR COLLECTION OR
GIVE CAUSE FOR THE ACCELERATION OF ANY INDEBTEDNESS OF THE SELLER OR ANY
SUBSIDIARY.

 

(C)           [RESERVED]

 

(D)           VALID SALE; REASONABLE EQUIVALENT VALUE.  EACH SALE OF RECEIVABLES
AND RELATED ASSETS MADE BY SUCH SELLER PURSUANT TO THIS AGREEMENT, AND EACH
CONTRIBUTION OF RECEIVABLES AND RELATED ASSETS MADE TO BUYER PURSUANT TO THIS
AGREEMENT, SHALL CONSTITUTE A VALID TRANSFER AND ASSIGNMENT OF ALL OF SUCH
SELLER’S RIGHT, TITLE AND INTEREST IN, TO AND UNDER SUCH RECEIVABLES AND THE
RELATED ASSETS OF SUCH SELLER TO BUYER THAT IS PERFECTED AND OF FIRST PRIORITY
UNDER THE UCC AND OTHERWISE, ENFORCEABLE AGAINST CREDITORS OF, AND PURCHASERS
FROM, SUCH SELLER AND FREE AND CLEAR OF ANY ADVERSE CLAIM (OTHER THAN ANY
PERMITTED ADVERSE CLAIM OR ANY ADVERSE CLAIM ARISING SOLELY AS A RESULT OF ANY
ACTION TAKEN BY BUYER HEREUNDER OR BY THE AGENT OR THE PURCHASER

 

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AGENTS UNDER THE RECEIVABLES SALE AGREEMENT); EACH SUCH SALE AND/OR CONTRIBUTION
HAS BEEN MADE FOR “REASONABLY EQUIVALENT VALUE” (AS SUCH TERM IS USED IN
SECTION 548 OF THE BANKRUPTCY CODE) AND NOT FOR OR ON ACCOUNT OF “ANTECEDENT
DEBT” (AS SUCH TERM IS USED IN SECTION 547 OF THE BANKRUPTCY CODE) OWED BY SUCH
ORIGINATOR TO THE SELLER.

 

(E)           BINDING EFFECT.  EACH TRANSACTION DOCUMENT TO WHICH THE SELLER IS
A PARTY CONSTITUTES THE LEGAL, VALID AND BINDING OBLIGATION OF THE SELLER
ENFORCEABLE AGAINST THE SELLER IN ACCORDANCE WITH ITS TERMS, EXCEPT AS LIMITED
BY BANKRUPTCY, INSOLVENCY, OR OTHER SIMILAR LAWS OF GENERAL APPLICATION RELATING
TO OR AFFECTING THE ENFORCEMENT OF CREDITORS’ RIGHTS GENERALLY AND SUBJECT TO
GENERAL PRINCIPLES OF EQUITY.

 

(F)            LITIGATION AND OTHER PROCEEDINGS.  EXCEPT AS DESCRIBED IN
SCHEDULE 1, THERE ARE NO ACTIONS, SUITS OR OTHER PROCEEDINGS (INCLUDING MATTERS
RELATING TO ENVIRONMENTAL LIABILITY) PENDING OR, TO THE KNOWLEDGE OF SELLER,
THREATENED AGAINST OR AFFECTING THE SELLER OR ANY SUBSIDIARY, OR ANY OF THEIR
RESPECTIVE PROPERTIES, THAT (I) IF ADVERSELY DETERMINED (INDIVIDUALLY OR IN THE
AGGREGATE), MAY HAVE A MATERIAL ADVERSE EFFECT ON THE FINANCIAL CONDITION OF THE
SELLER OR ANY SUBSIDIARY OR ON THE COLLECTIBILITY OF THE RECEIVABLES OR
(II) INVOLVE ANY TRANSACTION DOCUMENT OR ANY TRANSACTION CONTEMPLATED THEREBY.
NONE OF THE SELLER OR ANY SUBSIDIARY IS IN DEFAULT OF ANY CONTRACTUAL OBLIGATION
OR IN VIOLATION OF ANY ORDER, RULE OR REGULATION OF ANY GOVERNMENTAL AUTHORITY,
WHICH DEFAULT OR VIOLATION MAY HAVE A MATERIAL ADVERSE EFFECT UPON (I) THE
FINANCIAL CONDITION OF THE SELLER AND ITS SUBSIDIARIES TAKEN AS A WHOLE OR
(II) THE COLLECTIBILITY OF THE RECEIVABLES.

 

(G)           APPROVALS.  ALL AUTHORIZATIONS, CONSENTS, FILINGS, ORDERS AND
APPROVALS OF, OR OTHER ACTION BY, ANY GOVERNMENTAL AUTHORITY OR OTHER PERSON
THAT ARE REQUIRED TO BE OBTAINED BY SUCH SELLER, AND ALL NOTICES TO AND WITH ANY
GOVERNMENTAL AUTHORITY OR OTHER PERSON THAT ARE REQUIRED TO BE MADE BY IT, IN
THE CASE OF EACH OF THE FOREGOING IN CONNECTION WITH THE CONVEYANCE OF
RECEIVABLES AND RELATED ASSETS OR THE DUE EXECUTION, DELIVERY AND PERFORMANCE BY
SUCH SELLER OF THIS AGREEMENT, SUCH SELLER’S SELLER ASSIGNMENT CERTIFICATE OR
ANY OTHER TRANSACTION DOCUMENT TO WHICH IT IS A PARTY AND THE CONSUMMATION OF
THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT HAVE BEEN OBTAINED OR MADE AND
ARE IN FULL FORCE AND EFFECT, EXCEPT WHERE THE FAILURE TO OBTAIN OR MAKE ANY
SUCH AUTHORIZATION, CONSENT, ORDER, APPROVAL, ACTION, NOTICE OR FILING,
INDIVIDUALLY OR IN THE AGGREGATE FOR ALL SUCH FAILURES, WOULD NOT REASONABLY BE
EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT.

 

(H)           BULK SALES ACT. NO TRANSACTION CONTEMPLATED BY THIS AGREEMENT OR
ANY OTHER TRANSACTION DOCUMENT REQUIRES COMPLIANCE WITH, OR WILL BE SUBJECT TO
AVOIDANCE UNDER, ANY BULK SALES ACT OR SIMILAR LAW.

 

(I)            NO MATERIAL ADVERSE CHANGE. SINCE DECEMBER 31, 2004, THERE HAS
BEEN NO MATERIAL ADVERSE CHANGE IN (I) THE COLLECTIBILITY OF THE RECEIVABLES, OR
(II) THE SELLER’S FINANCIAL CONDITION OR (III) THE SELLER’S ABILITY TO PERFORM
ITS OBLIGATIONS UNDER ANY TRANSACTION DOCUMENT.

 

(J)            MARGIN REGULATIONS.  NO USE OF ANY FUNDS OBTAINED BY SUCH SELLER
UNDER THIS AGREEMENT WILL CONFLICT WITH OR CONTRAVENE ANY OF` REGULATIONS G, T,
U, AND X PROMULGATED BY THE FEDERAL RESERVE BOARD FROM TIME TO TIME.

 

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(K)           QUALITY OF TITLE.

 

(I)            IMMEDIATELY BEFORE EACH PURCHASE TO BE MADE BY BUYER HEREUNDER
AND (IN THE CASE OF THE PARENT) EACH CONTRIBUTION TO BE MADE HEREUNDER TO BUYER,
EACH RECEIVABLE AND SPECIFIED ASSET OF SUCH SELLER THAT IS THEN TO BE
TRANSFERRED TO BUYER THEREUNDER, AND THE RELATED CONTRACTS, SHALL BE OWNED BY
SUCH SELLER FREE AND CLEAR OF ANY ADVERSE CLAIM (OTHER THAN ANY PERMITTED
ADVERSE CLAIM OR ANY ADVERSE CLAIM ARISING SOLELY AS THE RESULT OF ANY ACTION
TAKEN BY BUYER HEREUNDER OR BY THE AGENT OR THE PURCHASER AGENTS UNDER THE
RECEIVABLES SALE AGREEMENT); PROVIDED THAT THE EXISTENCE OF AN ADVERSE CLAIM
THAT IS RELEASED ON THE FIRST ISSUANCE DATE SHALL NOT CONSTITUTE A BREACH OF
THIS REPRESENTATION AND WARRANT; AND SUCH SELLER SHALL HAVE MADE ALL UCC FILINGS
AND SHALL HAVE TAKEN ALL OTHER ACTION UNDER APPLICABLE LAW IN EACH RELEVANT
JURISDICTION IN ORDER TO PROTECT AND PERFECT THE OWNERSHIP INTEREST OF BUYER AND
ITS SUCCESSORS IN THE RECEIVABLES AND RELATED ASSETS AGAINST ALL CREDITORS OF,
AND PURCHASERS FROM, SUCH SELLER.

 

(II)           WHENEVER BUYER MAKES A PURCHASE HEREUNDER FROM SUCH SELLER OR (IN
THE CASE OF THE PARENT) ACCEPTS A CONTRIBUTION HEREUNDER FROM SUCH SELLER, IT
SHALL HAVE ACQUIRED A VALID AND PERFECTED FIRST PRIORITY OWNERSHIP INTEREST IN
EACH RECEIVABLE AND OTHER SPECIFIED ASSET, FREE AND CLEAR OF ANY ADVERSE CLAIM
(OTHER THAN ANY PERMITTED ADVERSE CLAIM OR ANY ADVERSE CLAIM ARISING SOLELY AS
THE RESULT OF ANY ACTION TAKEN BY BUYER HEREUNDER OR BY THE AGENT OR THE
PURCHASER AGENTS UNDER THE RECEIVABLES SALE AGREEMENT).

 

(III)          NO EFFECTIVE UCC FINANCING STATEMENT OR OTHER INSTRUMENT SIMILAR
IN EFFECT THAT COVERS ALL OR PART OF ANY RECEIVABLE ORIGINATED BY SUCH SELLER,
ANY INTEREST THEREIN OR ANY OTHER SPECIFIED ASSET WITH RESPECT THERETO IS ON
FILE IN ANY RECORDING OFFICE EXCEPT, (X) SUCH AS MAY BE FILED (A) IN FAVOR OF
SUCH SELLER IN ACCORDANCE WITH THE RELATED CONTRACTS, (B) IN FAVOR OF BUYER
PURSUANT TO THIS AGREEMENT AND (C) IN FAVOR OF THE AGENT, IN ACCORDANCE WITH THE
RECEIVABLES SALE AGREEMENT AND (Y) SUCH AS MAY HAVE BEEN IDENTIFIED TO BUYER
PRIOR TO THE FIRST ISSUANCE DATE AND UCC TERMINATION STATEMENTS (OR APPROPRIATE
RELEASES RELEASING ANY RECEIVABLES AND RELATED ASSETS DESCRIBED THEREIN)
RELATING TO WHICH HAVE BEEN FILED AND RECORDED ON OR PRIOR TO THE FIRST ISSUANCE
DATE. NO EFFECTIVE FINANCING STATEMENT OR INSTRUMENT SIMILAR IN EFFECT RELATING
TO PERFECTION THAT COVERS ANY INVENTORY OF SUCH SELLER THAT MIGHT GIVE RISE TO
RECEIVABLES IS ON FILE IN ANY RECORDING OFFICE.

 

(IV)          NO PURCHASE BY BUYER FROM SUCH SELLER (AND, IN THE CASE OF THE
PARENT, NO CAPITAL CONTRIBUTION TO BUYER, WHETHER OR NOT MADE IN CONNECTION WITH
A PURCHASE) CONSTITUTES A FRAUDULENT TRANSFER OR FRAUDULENT CONVEYANCE UNDER THE
UNITED STATES BANKRUPTCY CODE OR APPLICABLE STATE BANKRUPTCY OR INSOLVENCY LAWS
OR IS OTHERWISE VOID OR VOIDABLE OR SUBJECT TO SUBORDINATION UNDER SIMILAR LAWS
OR PRINCIPLES OR FOR ANY OTHER REASON.

 

(V)           EACH PURCHASE BY BUYER FROM SUCH SELLER CONSTITUTES A TRUE AND
VALID SALE OF THE RECEIVABLES AND RELATED ASSETS UNDER APPLICABLE STATE LAW AND
TRUE AND VALID ASSIGNMENTS AND TRANSFERS FOR CONSIDERATION (AND NOT MERELY A
PLEDGE OF THE RECEIVABLES AND RELATED ASSETS FOR SECURITY PURPOSES), ENFORCEABLE
AGAINST THE CREDITORS OF SUCH

 

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SELLER, AND NO RECEIVABLES OR RELATED ASSETS TRANSFERRED TO BUYER HEREUNDER
SHALL CONSTITUTE PROPERTY OF SUCH SELLER.

 

(L)            ELIGIBLE RECEIVABLES. ON THE DATE OF EACH DAILY REPORT OR
PERIODIC REPORT THAT IDENTIFIES A RECEIVABLE ORIGINATED BY SUCH SELLER AS AN
ELIGIBLE RECEIVABLE, SUCH RECEIVABLE EXISTS AND IS AN ELIGIBLE RECEIVABLE.

 

(M)          ACCURACY OF INFORMATION.  ALL INFORMATION FURNISHED BY THE SELLER
OR ANY AFFILIATE THEREOF TO THE BUYER, THE AGENT, THE PURCHASER AGENTS OR ANY
PURCHASER IN CONNECTION WITH ANY TRANSACTION DOCUMENT, OR ANY TRANSACTION
CONTEMPLATED THEREBY, IS TRUE AND ACCURATE IN ALL MATERIAL RESPECTS (AND IS NOT
INCOMPLETE BY OMITTING ANY INFORMATION NECESSARY TO PREVENT SUCH INFORMATION
FROM BEING MATERIALLY MISLEADING, IN EACH CASE ON THE DATE THE STATEMENT WAS
MADE AND IN LIGHT OF THE CIRCUMSTANCES UNDER WHICH THE STATEMENTS WERE MADE OR
THE INFORMATION WAS FURNISHED.

 

(N)           OFFICES.  (I) THE PRINCIPAL PLACE OF BUSINESS AND CHIEF EXECUTIVE
OFFICE OF SUCH SELLER IS LOCATED AT THE ADDRESS SET FORTH UNDER SUCH SELLER’S
SIGNATURE HERETO, AND HAS BEEN LOCATED AT SUCH ADDRESS SINCE SIX MONTHS PRIOR TO
THE FIRST ISSUANCE DATE AND (II) ANY OTHER LOCATION IN WHICH SUCH SELLER KEEPS
(OR HAS KEPT DURING THE PAST FOUR MONTHS) RECORDS RELATED TO THE RECEIVABLES OR
RELATED ASSETS (AND ALL ORIGINAL DOCUMENTS RELATING THERETO) IS SPECIFIED IN
SCHEDULE 3 (OR IN THE CASE OF EACH OF CLAUSE (I) AND CLAUSE (II), AT SUCH OTHER
LOCATIONS, NOTIFIED TO THE INITIAL COLLECTION AGENT AND THE AGENT IN ACCORDANCE
WITH SECTION 6.1(F), IN JURISDICTIONS WHERE ALL ACTION REQUIRED PURSUANT TO
SECTION 7.3 HAS BEEN TAKEN AND COMPLETED).

 

(O)           ACCOUNT BANKS AND PAYMENT INSTRUCTIONS.  THE NAMES AND ADDRESSES
OF ALL THE BANKS, TOGETHER WITH THE ACCOUNT NUMBERS OF THE ACCOUNTS AT SUCH
BANKS (AND ALL RELATED LOCKBOXES AND POST OFFICE BOXES), INTO WHICH COLLECTIONS
ARE PAID AS OF THE FIRST ISSUANCE DATE HAVE BEEN ACCURATELY IDENTIFIED TO BUYER,
THE PURCHASERS, THE PURCHASER AGENTS AND THE AGENT. SUCH SELLER HAS INSTRUCTED
ALL OBLIGORS TO SUBMIT ALL PAYMENTS ON THE RECEIVABLES AND RELATED ASSETS
DIRECTLY TO ONE OF THE LOCKBOXES OR LOCKBOX ACCOUNTS. THE LOCKBOX AGREEMENTS TO
WHICH SUCH SELLER IS A PARTY CONSTITUTE THE LEGAL, VALID AND BINDING OBLIGATIONS
OF THE PARTIES THERETO IN ACCORDANCE WITH THEIR RESPECTIVE TERMS SUBJECT TO
APPLICABLE BANKRUPTCY, REORGANIZATION, INSOLVENCY, MORATORIUM AND OTHER LAWS
AFFECTING CREDITORS’ RIGHTS GENERALLY AND GENERAL EQUITABLE PRINCIPLES. THE
SELLER HAS DELIVERED A COPY OF ALL LOCKBOX AGREEMENTS TO THE AGENT. THE SELLER
HAS NOT GRANTED ANY INTEREST IN ANY LOCKBOX OR LOCKBOX ACCOUNT TO ANY PERSON
OTHER THAN THE AGENT AND, UPON DELIVERY TO ANY LOCKBOX BANK OF THE RELATED
LOCKBOX LETTER, THE AGENT WILL HAVE EXCLUSIVE OWNERSHIP AND CONTROL OF THE
LOCKBOX ACCOUNT AT SUCH LOCKBOX BANK.

 

(P)           COMPLIANCE WITH APPLICABLE LAWS. SUCH SELLER IS IN COMPLIANCE WITH
THE REQUIREMENTS OF ALL APPLICABLE LAWS, RULES, REGULATIONS AND ORDERS OF ALL
GOVERNMENTAL AUTHORITIES (FEDERAL, STATE, LOCAL OR FOREIGN, AND INCLUDING
ENVIRONMENTAL LAWS), A VIOLATION OF ANY OF WHICH, INDIVIDUALLY OR IN THE
AGGREGATE FOR ALL SUCH VIOLATIONS, WOULD HAVE A SUBSTANTIAL LIKELIHOOD OF HAVING
A MATERIAL ADVERSE EFFECT.

 

(Q)           LEGAL NAMES.  EXCEPT AS SET FORTH IN SCHEDULE 4, DURING THE FIVE
YEARS PRIOR TO THE EFFECTIVE DATE, (I) SUCH SELLER HAS NOT BEEN KNOWN BY ANY
LEGAL NAME OTHER THAN ITS CORPORATE

 

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NAME AS OF THE DATE HEREOF (WHICH CORPORATE NAME IS SET FORTH ON ITS SIGNATURE
PAGE HERETO), EXCEPT TO THE EXTENT PERMITTED OTHERWISE PURSUANT TO
SECTION 6.3(E), AND (II) SUCH SELLER HAS NOT BEEN THE SUBJECT OF ANY MERGER OR
OTHER CORPORATE REORGANIZATION THAT RESULTED IN A CHANGE OF NAME, IDENTITY OR
CORPORATE STRUCTURE. SUCH SELLER USES NO TRADE NAMES OTHER THAN ITS ACTUAL
CORPORATE NAME, AND THE TRADE NAMES SET FORTH IN SCHEDULE 4.

 

(R)            INVESTMENT COMPANY ACT.  NEITHER SUCH SELLER NOR ANY OF SUCH
SELLER’S SUBSIDIARIES IS AN “INVESTMENT COMPANY”, OR CONTROLLED BY AN
“INVESTMENT COMPANY”, REGISTERED OR REQUIRED TO BE REGISTERED UNDER THE
INVESTMENT COMPANY ACT OF 1940, AS AMENDED.

 

(S)           TAXES.  SUCH SELLER HAS FILED OR CAUSED TO BE FILED ALL TAX
RETURNS AND REPORTS REQUIRED BY LAW TO HAVE BEEN FILED BY IT AND HAS PAID ALL
TAXES, ASSESSMENTS AND GOVERNMENTAL CHARGES THEREBY SHOWN TO BE OWING, EXCEPT
ANY SUCH TAXES, ASSESSMENTS OR CHARGES (I) THAT ARE BEING DILIGENTLY CONTESTED
IN GOOD FAITH BY APPROPRIATE PROCEEDINGS, (II) FOR WHICH ADEQUATE RESERVES IN
ACCORDANCE WITH GAAP SHALL HAVE BEEN SET ASIDE ON ITS BOOKS AND (III) WITH
RESPECT TO WHICH NO ADVERSE CLAIM, EXCEPT PERMITTED ADVERSE CLAIMS, HAS BEEN
IMPOSED UPON ANY RECEIVABLES OR RELATED ASSETS.

 

ARTICLE VI
GENERAL COVENANTS OF THE SELLERS

 

SECTION 6.1                 AFFIRMATIVE COVENANTS.  FROM THE FIRST ISSUANCE DATE
UNTIL THE FIRST DAY FOLLOWING THE PURCHASE TERMINATION DATE ON WHICH ALL
OBLIGATIONS OF THE SELLERS UNDER THE TRANSACTION DOCUMENTS SHALL HAVE BEEN
FINALLY AND FULLY PAID AND PERFORMED, UNLESS THE AGENT (ACTING THE DIRECTION OF
THE INSTRUCTING GROUP) (AS ASSIGNEE OF BUYER) SHALL OTHERWISE GIVE ITS PRIOR
WRITTEN CONSENT, EACH SELLER HEREBY AGREES THAT IT WILL PERFORM THE COVENANTS
AND AGREEMENTS SET FORTH IN THIS SECTION.

 

(A)           COMPLIANCE WITH LAWS, ETC.  THE SELLER WILL COMPLY, AND WILL CAUSE
EACH SUBSIDIARY TO COMPLY, WITH ALL LAWS, REGULATIONS, JUDGMENTS AND OTHER
DIRECTIONS OR ORDERS IMPOSED BY ANY GOVERNMENTAL AUTHORITY TO WHICH SUCH PERSON
OR ANY RECEIVABLE, OR COLLECTION MAY BE SUBJECT.

 

(B)           PRESERVATION OF CORPORATE EXISTENCE.  THE SELLER WILL PERFORM, AND
WILL CAUSE EACH SUBSIDIARY TO PERFORM, ALL ACTIONS NECESSARY TO REMAIN DULY
INCORPORATED, VALIDLY EXISTING AND IN GOOD STANDING IN ITS JURISDICTION OF
INCORPORATION AND TO MAINTAIN ALL REQUISITE AUTHORITY TO CONDUCT ITS BUSINESS IN
EACH JURISDICTION IN WHICH IT CONDUCTS BUSINESS.

 

(C)           RECEIVABLES REVIEWS.  THE SELLER WILL FURNISH TO THE BUYER, THE
AGENT AND THE PURCHASERS SUCH INFORMATION CONCERNING THE RECEIVABLES AS THE
AGENT OR A PURCHASER MAY REASONABLY REQUEST AND AS MAY BE GENERATED BY THE THEN
EXISTING DATA PROCESSING CAPACITY OF THE SELLER. THE SELLER WILL PERMIT, AT ANY
TIME DURING REGULAR BUSINESS HOURS, THE AGENT OR ANY PURCHASER (OR ANY
REPRESENTATIVES THEREOF), ONCE PER YEAR OR AT ANY TIME AFTER THE OCCURRENCE OF A
TERMINATION EVENT (AT THE EXPENSE OF THE SELLER) OR AT ANY OTHER TIME (AT THE
EXPENSE OF THE AGENT OR SUCH PURCHASER (AS APPLICABLE)) (I) TO EXAMINE AND MAKE
COPIES OF ALL RECORDS, (II) TO VISIT THE OFFICES AND PROPERTIES OF THE SELLER
FOR THE PURPOSE OF EXAMINING THE RECORDS AND (III) TO DISCUSS MATTERS RELATING
HERETO WITH ANY OF THE SELLER’S OFFICERS, DIRECTORS, EMPLOYEES OR INDEPENDENT

 

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PUBLIC ACCOUNTANTS HAVING KNOWLEDGE OF SUCH MATTERS. ONCE A YEAR, THE AGENT MAY
(AT THE EXPENSE OF THE SELLER) HAVE AN INDEPENDENT PUBLIC ACCOUNTING FIRM
CONDUCT AN AUDIT OF THE RECORDS OR MAKE TEST VERIFICATIONS OF THE RECEIVABLES
AND COLLECTIONS.

 

(D)           KEEPING OF RECORDS AND BOOKS OF ACCOUNT.  THE SELLER WILL HAVE AND
MAINTAIN (A) ADMINISTRATIVE AND OPERATING PROCEDURES INCLUDING AN ABILITY TO
RE-CREATE RECORDS IF ORIGINALS ARE DESTROYED), (B) ADEQUATE FACILITIES,
PERSONNEL AND EQUIPMENT AND (C) ALL RECORDS AND OTHER INFORMATION NECESSARY OR
ADVISABLE FOR COLLECTING THE RECEIVABLES (INCLUDING RECORDS ADEQUATE TO PERMIT
THE IMMEDIATE IDENTIFICATION OF EACH NEW RECEIVABLE AND ALL COLLECTIONS OF, AND
ADJUSTMENTS TO, EACH EXISTING RECEIVABLE). THE SELLER WILL GIVE EACH OF THE
BUYER AND THE AGENT PRIOR NOTICE OF ANY MATERIAL CHANGE IN SUCH ADMINISTRATIVE
AND OPERATING PROCEDURES.

 

(E)           PERFORMANCE AND COMPLIANCE WITH RECEIVABLES AND CONTRACTS.  SUCH
SELLER WILL, AT ITS EXPENSE, TIMELY AND FULLY PERFORM AND COMPLY WITH ALL
PROVISIONS, COVENANTS AND OTHER PROMISES REQUIRED TO BE OBSERVED BY IT UNDER THE
CONTRACTS OF SUCH SELLER RELATED TO THE RECEIVABLES AND RELATED ASSETS, IN EACH
CASE TO THE EXTENT FAILURE TO PERFORM OR COMPLY, INDIVIDUALLY OR IN THE
AGGREGATE FOR ALL SUCH FAILURES, WOULD HAVE A SUBSTANTIAL LIKELIHOOD OF HAVING A
MATERIAL ADVERSE EFFECT.

 

(F)            LOCATION OF RECORDS AND OFFICES.  SUCH SELLER KEEPS (I) ITS
PRINCIPAL PLACE OF BUSINESS AND CHIEF EXECUTIVE OFFICE AT THE ADDRESS SET FORTH
UNDER SUCH SELLER’S SIGNATURE HERETO, AND (II) THE OFFICES WHERE IT MAINTAINS
ALL RECORDS RELATED TO THE RECEIVABLES AND THE RELATED ASSETS (AND ALL ORIGINAL
DOCUMENTS RELATING THERETO) AT THE ADDRESSES REFERRED TO IN SCHEDULE 3 (OR, IN
THE CASE OF EACH OF CLAUSE (I) AND CLAUSE (II), UPON NOT LESS THAN 30 DAYS’
PRIOR WRITTEN NOTICE GIVEN BY SUCH SELLER TO BUYER AND THE AGENT AT SUCH OTHER
LOCATIONS IN JURISDICTIONS WHERE ALL ACTION REQUIRED BY SECTION 7.3 SHALL HAVE
BEEN TAKEN AND COMPLETED).

 

(G)           CREDIT AND COLLECTION POLICIES.  SUCH SELLER WILL COMPLY IN ALL
MATERIAL RESPECTS WITH ITS CREDIT AND COLLECTION POLICY IN REGARD TO EACH
RECEIVABLE OF SUCH SELLER AND THE RELATED ASSETS AND THE CONTRACTS RELATED TO
EACH SUCH RECEIVABLE.

 

(H)           SEPARATE CORPORATE EXISTENCE OF BUYER.  SUCH SELLER HEREBY
ACKNOWLEDGES THAT THE BUYER IS ENTERING INTO THE TRANSACTIONS CONTEMPLATED BY
THE TRANSACTION DOCUMENTS IN RELIANCE UPON BUYER’S IDENTITY AS A LEGAL ENTITY
SEPARATE FROM SUCH SELLER. THEREFORE, SUCH SELLER WILL TAKE ALL REASONABLE STEPS
TO CONTINUE THEIR RESPECTIVE IDENTITIES AS SEPARATE LEGAL ENTITIES AND TO MAKE
IT APPARENT TO THIRD PERSONS THAT EACH IS AN ENTITY WITH ASSETS AND LIABILITIES
DISTINCT FROM THOSE OF BUYER AND THAT BUYER IS NOT A DIVISION OF THE INITIAL
COLLECTION AGENT, SUCH SELLER, THE PARENT OR ANY OTHER PERSON. WITHOUT LIMITING
THE FOREGOING, EACH SELLER WILL OPERATE, CONDUCT THEIR RESPECTIVE BUSINESSES AND
OTHERWISE ACT IN A MANNER WHICH IS CONSISTENT WITH THE FACTUAL ASSUMPTIONS IN
EACH OF THE OPINIONS OF THACHER PROFFITT & WOOD LLP DATED SEPTEMBER 28, 2006
REGARDING CERTAIN SUBSTANTIVE CONSOLIDATION AND TRUE SALE ISSUES.

 

(I)            PAYMENT INSTRUCTIONS TO OBLIGORS.  SUCH SELLER WILL INSTRUCT ALL
OBLIGORS TO SUBMIT ALL PAYMENTS EITHER (I) TO ONE OF THE LOCKBOXES FOR DEPOSIT
IN A LOCKBOX ACCOUNT OR (II) DIRECTLY TO ONE OF THE LOCKBOX ACCOUNTS.

 

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(J)            SEGREGATION OF COLLECTIONS.  SUCH SELLER SHALL USE REASONABLE
EFFORTS TO MINIMIZE THE DEPOSIT OF ANY FUNDS OTHER THAN COLLECTIONS INTO ANY OF
THE TRANSACTION ACCOUNTS AND, TO THE EXTENT THAT ANY SUCH FUNDS NEVERTHELESS ARE
DEPOSITED INTO ANY OF THE TRANSACTION ACCOUNTS, SHALL PROMPTLY IDENTIFY ANY SUCH
FUNDS, OR SHALL CAUSE THE FUNDS TO BE SO IDENTIFIED, TO BUYER, THE INITIAL
COLLECTION AGENT AND THE AGENT (FOLLOWING WHICH NOTICE, BUYER SHALL CAUSE THE
INITIAL COLLECTION AGENT TO RETURN ALL THE FUNDS TO SUCH SELLER).

 

(K)           IDENTIFICATION OF ELIGIBLE RECEIVABLES.  SUCH SELLER WILL
ESTABLISH AND MAINTAIN SUCH PROCEDURES AS ARE NECESSARY FOR DETERMINING NO LESS
FREQUENTLY THAN EACH BUSINESS DAY WHETHER EACH RECEIVABLE QUALIFIES AS AN
ELIGIBLE RECEIVABLE, AND FOR IDENTIFYING, ON ANY BUSINESS DAY, ALL RECEIVABLES
TO BE SOLD ON THAT DATE THAT ARE NOT ELIGIBLE RECEIVABLES.

 

(L)            ACCURACY OF INFORMATION.  ALL WRITTEN INFORMATION FURNISHED ON
AND AFTER THE FIRST ISSUANCE DATE BY OR ON BEHALF OF SUCH SELLER TO BUYER, THE
AGENT OR THE PURCHASER AGENTS PURSUANT TO OR IN CONNECTION WITH ANY TRANSACTION
DOCUMENT OR ANY TRANSACTION CONTEMPLATED HEREIN OR THEREIN SHALL NOT CONTAIN ANY
UNTRUE STATEMENT OF A MATERIAL FACT OR OMIT TO STATE ANY MATERIAL FACT NECESSARY
TO MAKE THE STATEMENTS MADE NOT MISLEADING, IN EACH CASE ON THE DATE THE
STATEMENT WAS MADE AND IN LIGHT OF THE CIRCUMSTANCES UNDER WHICH THE STATEMENTS
WERE MADE OR THE INFORMATION WAS FURNISHED.

 

(M)          TAXES.  SUCH SELLER SHALL FILE OR CAUSE TO BE FILED, AND CAUSE EACH
PERSON WITH WHOM IT SHARES CONSOLIDATED TAX LIABILITY TO FILE, ALL FEDERAL,
STATE AND LOCAL TAX RETURNS THAT ARE REQUIRED TO BE FILED BY IT (EXCEPT WHERE
THE FAILURE TO FILE SUCH RETURNS DOES NOT HAVE A SUBSTANTIAL LIKELIHOOD OF
HAVING A MATERIAL ADVERSE EFFECT) AND PAY OR CAUSE TO BE PAID ALL TAXES SHOWN TO
BE DUE AND PAYABLE ON TAXES OR ASSESSMENTS (EXCEPT ONLY SUCH TAXES OR
ASSESSMENTS THE VALIDITY OF WHICH ARE BEING CONTESTED IN GOOD FAITH BY
APPROPRIATE PROCEEDING AND WITH RESPECT TO WHICH SUCH SELLER SHALL HAVE SET
ASIDE ADEQUATE RESERVES ON ITS BOOKS IN ACCORDANCE WITH GAAP AND WHICH
PROCEEDINGS DO NOT HAVE A SUBSTANTIAL LIKELIHOOD OF HAVING A MATERIAL ADVERSE
EFFECT).

 

(N)           SOFTWARE LICENSES. SUCH SELLER SHALL CAUSE ALL SOFTWARE LICENSES
OR SIMILAR AGREEMENTS USED BY THE SELLERS OR INITIAL COLLECTION AGENT IN THE
ORIGINATION OR SERVICING OF RECEIVABLES TO EXPRESSLY PERMIT USE BY ANY SUCCESSOR
INITIAL COLLECTION AGENT OF THE MATERIALS SUBJECT TO SUCH LICENSES OR
AGREEMENTS.

 

(O)           PAYMENT OF ACCOUNTS PAYABLE.  SUCH SELLER SHALL PAY ALL OF ITS
ACCOUNTS PAYABLE IN ACCORDANCE WITH ITS NORMAL BUSINESS.

 

SECTION 6.2                 REPORTING RESPONSIBILITIES.  UNTIL THE FIRST DAY
FOLLOWING THE PURCHASE TERMINATION DATE ON WHICH ALL OBLIGATIONS OF THE SELLERS
SHALL HAVE BEEN FINALLY AND FULLY PAID AND PERFORMED UNDER THE TRANSACTION
DOCUMENTS, UNLESS THE AGENT (ACTING AT THE DIRECTION OF THE INSTRUCTING GROUP)
(AS ASSIGNEE OF BUYER) SHALL OTHERWISE GIVE ITS PRIOR WRITTEN CONSENT, EACH
SELLER HEREBY AGREES THAT IT WILL PERFORM THE COVENANTS AND AGREEMENTS SET FORTH
IN THIS SECTION.

 

(A)           FINANCIAL REPORTING.  THE SELLER WILL, AND WILL CAUSE EACH
SUBSIDIARY TO, MAINTAIN A SYSTEM OF ACCOUNTING, ESTABLISHED AND ADMINISTERED IN
ACCORDANCE WITH GAAP AND WILL FURNISH (OR WILL CAUSE TO BE FURNISHED) TO THE
AGENT AND EACH PURCHASER:

 

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(I)            ANNUAL FINANCIAL STATEMENTS. WITHIN 95 DAYS AFTER EACH FISCAL
YEAR OF (A) THE PARENT, COPIES OF THE PARENT’S CONSOLIDATED ANNUAL AUDITED
FINANCIAL STATEMENTS (INCLUDING A CONSOLIDATED BALANCE SHEET, CONSOLIDATED
STATEMENT OF INCOME AND RETAINED EARNINGS AND STATEMENT OF CASH FLOWS, WITH
RELATED FOOTNOTES) CERTIFIED BY PARENT’S FIRM OF INDEPENDENT CERTIFIED PUBLIC
ACCOUNTANTS AND PREPARED ON A CONSOLIDATED BASIS IN CONFORMITY WITH GAAP, AND
(B) THE SELLER, THE ANNUAL BALANCE SHEET AND ANNUAL PROFIT AND LOSS STATEMENT OF
THE SELLER CERTIFIED BY A AUTHORIZED OFFICER THEREOF, IN EACH CASE PREPARED ON A
CONSOLIDATED BASIS IN CONFORMITY WITH GAAP AS OF THE CLOSE OF SUCH FISCAL YEAR
FOR THE YEAR THEN ENDED;

 

(II)           QUARTERLY FINANCIAL STATEMENTS.  WITHIN 50 DAYS AFTER EACH
(EXCEPT THE LAST) FISCAL QUARTER OF EACH FISCAL YEAR OF (A) THE PARENT, COPIES
OF ITS UNAUDITED FINANCIAL STATEMENTS (INCLUDING AT LEAST A CONSOLIDATED BALANCE
SHEET AS OF THE CLOSE OF SUCH QUARTER AND STATEMENTS OF EARNINGS AND SOURCES AND
APPLICATIONS OF FUNDS FOR THE PERIOD FROM THE BEGINNING OF THE FISCAL YEAR TO
THE CLOSE OF SUCH QUARTER) CERTIFIED BY A AUTHORIZED OFFICER AND PREPARED IN A
MANNER CONSISTENT WITH THE FINANCIAL STATEMENTS DESCRIBED IN PART (A) OF CLAUSE
(I) OF THIS SECTION 5.1(A), AND (B) THE SELLER, THE QUARTERLY BALANCE SHEET AND
A PROFIT AND LOSS STATEMENT OF THE SELLER FOR THE PERIOD FROM THE BEGINNING OF
SUCH FISCAL YEAR TO THE CLOSE OF SUCH QUARTER, IN EACH CASE CERTIFIED BY A
AUTHORIZED OFFICER THEREOF AND PREPARED IN A MANNER CONSISTENT WITH PART (B) OF
CLAUSE (I) OF SECTION 5.1 (A);

 

(III)          OFFICER’S CERTIFICATE. EACH TIME FINANCIAL STATEMENTS ARE
FURNISHED PURSUANT TO CLAUSE (I) OR (II) OF SECTION 6.2 (A), A COMPLIANCE
CERTIFICATE (IN SUBSTANTIALLY THE FORM OF EXHIBIT I TO THE RECEIVABLES SALE
AGREEMENT) SIGNED BY A AUTHORIZED OFFICER, DATED THE DATE OF SUCH FINANCIAL
STATEMENTS;

 

(IV)          PUBLIC REPORTS.  PROMPTLY UPON BECOMING AVAILABLE, A COPY OF EACH
REPORT OR PROXY STATEMENT FILED BY THE PARENT WITH THE SECURITIES EXCHANGE
COMMISSION OR ANY SECURITIES EXCHANGE;

 

(V)           CHEMTURA CREDIT AGREEMENT CERTIFICATE.  WHEN DELIVERED TO THE
BANKS PARTY TO THE CHEMTURA CREDIT AGREEMENT, A COPY OF THE CERTIFICATES AND
SCHEDULES DESCRIBED IN SECTIONS 5.03(B)(I) AND (II) AND 5.03(C)(I) AND (II) OF`
THE CHEMTURA CREDIT AGREEMENT; AND

 

(VI)          OTHER INFORMATION.  WITH REASONABLE PROMPTNESS, SUCH OTHER
INFORMATION (INCLUDING NON-FINANCIAL INFORMATION) AS MAY BE REASONABLY REQUESTED
BY THE AGENT OR ANY PURCHASER (WITH A COPY OF SUCH REQUEST TO THE AGENT).

 

(B)           NOTICES. IMMEDIATELY UPON BECOMING AWARE OF ANY OF THE FOLLOWING,
THE SELLER WILL NOTIFY THE AGENT AND PROVIDE A DESCRIPTION OF:

 

(I)            POTENTIAL TERMINATION EVENTS.  THE OCCURRENCE OF ANY POTENTIAL
TERMINATION EVENT;

 

(II)           REPRESENTATIONS AND WARRANTIES. THE FAILURE OF ANY REPRESENTATION
OR WARRANTY HEREIN TO BE TRUE (WHEN MADE OR AT ANY TIME THEREAFTER) IN ANY
MATERIAL RESPECT;

 

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(III)          DOWNGRADING.  THE DOWNGRADING, WITHDRAWAL OR SUSPENSION OF ANY
RATING BY ANY RATING AGENCY OF ANY INDEBTEDNESS OF THE SELLER;

 

(IV)          LITIGATION. THE INSTITUTION OF ANY LITIGATION, ARBITRATION
PROCEEDING OR GOVERNMENTAL PROCEEDING REASONABLY LIKELY TO BE MATERIAL TO THE
SELLER, ANY SUBSIDIARY OR THE COLLECTIBILITY OR QUALITY OF THE RECEIVABLES;

 

(V)           JUDGMENTS. THE ENTRY OF ANY JUDGMENT OR DECREE AGAINST THE SELLER
OR ANY SUBSIDIARY IF THE AGGREGATE AMOUNT OF ALL JUDGMENTS THEN OUTSTANDING
AGAINST THE SELLER AND THE SUBSIDIARIES EXCEEDS $5,000,000; OR

 

(VI)          CHANGES IN BUSINESS. ANY CHANGE IN, OR PROPOSED CHANGE IN, THE
CHARACTER OF THE SELLER’S BUSINESS THAT COULD IMPAIR THE COLLECTIBILITY OR
QUALITY OF ANY RECEIVABLE.

 

SECTION 6.3                 NEGATIVE COVENANTS.  UNTIL THE FIRST DAY FOLLOWING
THE PURCHASE TERMINATION DATE ON WHICH ALL OBLIGATIONS OF THE SELLERS UNDER THE
TRANSACTION DOCUMENTS SHALL HAVE BEEN FINALLY AND FULLY PAID AND PERFORMED,
UNLESS THE AGENT (ACTING AT THE DIRECTION OF THE INSTRUCTING GROUP) (AS ASSIGNEE
OF BUYER) SHALL OTHERWISE GIVE ITS PRIOR WRITTEN CONSENT, EACH SELLER HEREBY
AGREES THAT IT WILL PERFORM THE COVENANTS AND AGREEMENTS SET FORTH IN THIS
SECTION.

 

(A)           SALES, LIENS, ETC.  EXCEPT AS OTHERWISE PROVIDED IN THE
RECEIVABLES SALE AGREEMENT, SUCH SELLER WILL NOT (I)(A) SELL, ASSIGN (BY
OPERATION OF LAW OR OTHERWISE) OR OTHERWISE TRANSFER TO ANY PERSON, (B) PLEDGE
ANY INTEREST IN, (C) GRANT, CREATE, INCUR, ASSUME OR PERMIT TO EXIST ANY ADVERSE
CLAIM (OTHER THAN PERMITTED ADVERSE CLAIMS) TO OR IN FAVOR OF ANY PERSON UPON OR
WITH RESPECT TO, OR (D) CAUSE TO BE FILED ANY UCC FINANCING STATEMENT OR
EQUIVALENT DOCUMENT RELATING TO PERFECTION WITH RESPECT TO ANY SPECIFIED ASSET
OR ANY CONTRACT RELATED TO ANY RECEIVABLE, OR UPON OR WITH RESPECT TO ANY
LOCKBOX OR ACCOUNT TO WHICH ANY COLLECTIONS OF ANY SUCH RECEIVABLE OR ANY
RELATED ASSETS ARE SENT OR ANY INTEREST THEREIN, OR (II) ASSIGN TO ANY PERSON
ANY RIGHT TO RECEIVE INCOME FROM OR IN RESPECT OF ANY OF THE FOREGOING.

 

In the event that such Seller fails to keep any Specified Assets free and clear
of any Adverse Claim (other than a Permitted Adverse Claim, any Adverse Claims
arising hereunder, and other Adverse Claims permitted by any other Transaction
Document), Buyer may (without limiting its other rights with respect to, such
Seller’s breach of its obligations hereunder) make reasonable expenditures
necessary to release the Adverse Claim. Buyer shall be entitled to
indemnification for any such expenditures pursuant to the indemnification
provisions of Article IX. Alternatively, Buyer may deduct such expenditures as
an offset to the Purchase Price owed to such Seller hereunder.

 

Such Seller will not pledge or grant any security interest in the Buyer Note or
the capital stock of Buyer unless prior to any pledge or grant such Seller,
Buyer, the Agent and the Person for whose benefit the pledge or grant is being
made have entered into an Intercreditor Agreement reasonably acceptable to the
Instructing Group.

 

(B)           EXTENSION OR AMENDMENT OF RECEIVABLES; CHANGE IN CREDIT AND
COLLECTION POLICY OR CONTRACTS.  SUCH SELLER WILL NOT EXTEND, AMEND, WAIVE OR
OTHERWISE MODIFY THE TERMS OF ANY RECEIVABLE OR CONTRACT RELATED THERETO EXCEPT
AS PERMITTED PURSUANT TO

 

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SECTION 3.2(B) OF THE RECEIVABLES SALE AGREEMENT AND SUBJECT TO THE LIMITATION
SET FORTH IN SECTION 1.5 OF THE RECEIVABLES SALE AGREEMENT. SUCH SELLER SHALL
NOT CHANGE THE TERMS AND PROVISIONS OF THE CREDIT AND COLLECTION POLICY IN ANY
MATERIAL RESPECT.

 

(C)           CHANGE IN PAYMENT INSTRUCTIONS TO OBLIGORS.  SUCH SELLER WILL NOT
(I) ADD OR TERMINATE ANY BANK AS AN ACCOUNT BANK (OR ADD OR TERMINATE ANY
RELATED LOCKBOX OR BANK ACCOUNT) FROM THOSE LISTED IN THE LETTER REFERRED TO IN
SECTION 5.1(O) UNLESS, PRIOR TO ANY SUCH ADDITION OR TERMINATION, BUYER AND THE
AGENT SHALL HAVE RECEIVED NOT LESS THAN TEN BUSINESS DAYS PRIOR WRITTEN NOTICE
OF THE ADDITION OR TERMINATION AND, NOT LESS THAN TEN BUSINESS DAYS PRIOR TO THE
EFFECTIVE DATE OF ANY SUCH PROPOSED ADDITION OR TERMINATION, BUYER AND THE AGENT
SHALL HAVE RECEIVED (A) COUNTERPARTS OF THE APPLICABLE TYPE OF ACCOUNT AGREEMENT
WITH EACH NEW ACCOUNT BANK, DULY EXECUTED BY SUCH NEW ACCOUNT BANK AND ALL OTHER
PARTIES THERETO AND (B) COPIES OF ALL OTHER AGREEMENTS AND DOCUMENTS SIGNED BY
THE ACCOUNT BANK AND SUCH OTHER PARTIES WITH RESPECT TO ANY NEW BANK ACCOUNT AND
ANY NEW LOCKBOX, OR (II) MAKE ANY CHANGE IN ITS INSTRUCTIONS TO OBLIGORS, GIVEN
ACCORDANCE WITH SECTION 5.1(O) REGARDING PAYMENTS TO BE MADE BY OBLIGORS, OTHER
THAN CHANGES IN THE INSTRUCTIONS THAT DIRECT OBLIGORS TO MAKE PAYMENTS TO
ANOTHER LOCKBOX OR BANK ACCOUNT THAT IN EACH CASE IS SUBJECT TO AN ACCOUNT
AGREEMENT.

 

(D)           MERGERS, ACQUISITIONS, SALES, ETC.  EXCEPT FOR (I) MERGERS OR
CONSOLIDATIONS IN WHICH SUCH SELLER IS THE SURVIVING PERSON, (II) MERGERS OR
CONSOLIDATIONS OF A SUBSIDIARY OF THE PARENT INTO SUCH SELLER OR (III) MERGER,
OR CONSOLIDATIONS IN WHICH THE SURVIVING PERSON EXPRESSLY ASSUMES THE
PERFORMANCE OF THIS AGREEMENT, SUCH SELLER WILL NOT BE A PARTY TO ANY MERGER OR
CONSOLIDATION. SUCH SELLER WILL GIVE THE AGENT NOTICE OF ANY SUCH PERMITTED
MERGER OR CONSOLIDATION PROMPTLY FOLLOWING COMPLETION THEREOF. SUCH SELLER WILL
NOT, DIRECTLY OR INDIRECTLY, TRANSFER, ASSIGN, CONVEY OR LEASE, WHETHER IN ONE
TRANSACTION OR IN A SERIES OF TRANSACTIONS, ALL OR SUBSTANTIALLY ALL OF ITS
ASSETS OR SELL OR ASSIGN, WITH OR WITHOUT RECOURSE, ANY RECEIVABLES OR RELATED
ASSETS, IN EACH CASE OTHER THAN PURSUANT TO THIS AGREEMENT.

 

(E)           CHANGE IN NAME. SUCH SELLER WILL NOT (I) CHANGE ITS CORPORATE NAME
OR (II) CHANGE THE NAME UNDER OR BY WHICH IT DOES BUSINESS, IN EACH CASE UNLESS
SUCH SELLER SHALL HAVE GIVEN BUYER, THE INITIAL COLLECTION AGENT AND THE AGENT
30 DAYS’ PRIOR WRITTEN NOTICE THEREOF AND UNLESS, PRIOR TO ANY CHANGE IN NAME,
SUCH SELLER SHALL HAVE TAKEN AND COMPLETED ALL ACTION REQUIRED BY SECTION 7.3.
THE SELLER WILL AT ALL TIMES MAINTAIN ITS JURISDICTION OF ORGANIZATION WITHIN A
JURISDICTION IN THE UNITED STATES OF AMERICA (OTHER THAN IN THE STATES OF
FLORIDA, MARYLAND AND TENNESSEE) IN WHICH ARTICLE 9 OF THE UCC IS IN EFFECT. IF
THE SELLER MOVES ITS JURISDICTION OF ORGANIZATION TO A LOCATION THAT IMPOSES
TAXES, FEES OR OTHER CHARGES TO PERFECT THE AGENT’S AND THE PURCHASERS’
INTERESTS HEREUNDER (AS ASSIGNEE OF BUYER), THE SELLER WILL PAY ALL SUCH AMOUNTS
AND ANY OTHER COSTS AND EXPENSES INCURRED IN ORDER TO MAINTAIN THE
ENFORCEABILITY OF THE TRANSACTION DOCUMENTS AND THE INTERESTS OF THE AGENT AND
THE PURCHASERS (AS ASSIGNEE OF BUYER) IN THE RECEIVABLES AND COLLECTIONS.

 

(F)            CERTIFICATE OF INCORPORATION.  SUCH SELLER WILL NOT CAUSE OR
PERMIT BUYER TO AMEND ITS CERTIFICATE OF INCORPORATION WITHOUT THE PRIOR WRITTEN
CONSENT, WHICH CONSENT

 

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WILL NOT BE UNREASONABLY WITHHELD OR DELAYED, OF THE AGENT (ACTING AT THE
DIRECTION OF THE INSTRUCTING GROUP), IN ITS CAPACITY AS ASSIGNEE OF THE BUYER.

 

(G)           AMENDMENTS TO TRANSACTION DOCUMENTS.  SUCH SELLER WILL NOT AMEND
OR OTHERWISE MODIFY OR WAIVE ANY TRANSACTION DOCUMENT TO WHICH IT IS A PARTY
UNLESS THE AGENT (ACTING AT THE DIRECTION OF THE INSTRUCTING GROUP), IN ITS
CAPACITY AS ASSIGNEE OF THE BUYER, SHALL HAVE GIVEN ITS PRIOR WRITTEN CONSENT TO
EACH AMENDMENT, MODIFICATION OR WAIVER.

 

(H)           ACCOUNTING FOR PURCHASES. SUCH SELLER SHALL PREPARE ITS FINANCIAL
STATEMENTS IN ACCORDANCE WITH GAAP, AND ANY FINANCIAL STATEMENTS WHICH ARE
CONSOLIDATED TO INCLUDE BUYER WILL CONTAIN FOOTNOTES STATING THAT SUCH SELLER
HAS SOLD OR CONTRIBUTED ITS RECEIVABLES TO BUYER AND THAT THE ASSETS OF BUYER
WILL NOT BE AVAILABLE TO THE PARENT AND ITS SUBSIDIARIES UNLESS BUYER’S
LIABILITIES HAVE BEEN PAID IN FULL. SUCH SELLER SHALL NOT PREPARE ANY FINANCIAL
STATEMENTS THAT ACCOUNT FOR THE TRANSACTIONS CONTEMPLATED IN THIS AGREEMENT IN
ANY MANNER OTHER THAN AS A SALE OF THE PURCHASED ASSETS BY SUCH SELLER TO BUYER,
OR IN ANY OTHER RESPECT ACCOUNT FOR OR TREAT THE TRANSACTIONS CONTEMPLATED IN
THIS AGREEMENT (INCLUDING BUT NOT LIMITED TO ACCOUNTING AND, WHERE TAXES ARE NOT
CONSOLIDATED, FOR TAX REPORTING PURPOSES) IN ANY MANNER OTHER THAN AS A SALE OF
THE PURCHASED ASSETS BY SUCH SELLER TO BUYER.

 

ARTICLE VII

ADDITIONAL RIGHTS AND OBLIGATIONS IN

RESPECT OF THE SPECIFIED ASSETS

 

SECTION 7.1                 RIGHTS OF BUYER.  (A)  EACH SELLER HEREBY AUTHORIZES
BUYER, THE INITIAL COLLECTION AGENT AND/OR THEIR RESPECTIVE DESIGNEES TO TAKE
ANY AND ALL STEPS IN SUCH SELLERS NAME AND ON BEHALF OF SUCH SELLER THAT BUYER,
THE INITIAL COLLECTION AGENT AND/OR THEIR RESPECTIVE DESIGNEES DETERMINE ARE
REASONABLY NECESSARY OR APPROPRIATE TO COLLECT ALL AMOUNTS DUE UNDER ANY AND ALL
SPECIFIED ASSETS, INCLUDING ENDORSING THE NAME OF SUCH SELLER ON CHECKS AND
OTHER INSTRUMENTS REPRESENTING COLLECTIONS AND ENFORCING SUCH SELLER’S RIGHTS
UNDER SUCH SPECIFIED ASSETS.

 

(B)           EXCEPT AS SET FORTH IN SECTION 3.1 WITH RESPECT TO SELLER
NONCOMPLYING RECEIVABLES, BUYER SHALL HAVE NO OBLIGATION TO ACCOUNT FOR ANY
SPECIFIED ASSET TO ANY SELLER. BUYER SHALL HAVE NO OBLIGATION TO ACCOUNT FOR, OR
TO RETURN COLLECTIONS, OR ANY INTEREST OR OTHER FINANCE CHARGE COLLECTED
PURSUANT THERETO, TO ANY SELLER, IRRESPECTIVE OF WHETHER SUCH COLLECTIONS AND
CHARGES ARE IN EXCESS OF THE PURCHASE PRICE FOR THE PURCHASED ASSETS.

 

(C)           BUYER SHALL HAVE THE UNRESTRICTED RIGHT TO FURTHER ASSIGN,
TRANSFER, DELIVER, HYPOTHECATE, SUBDIVIDE OR OTHERWISE DEAL WITH THE SPECIFIED
ASSETS, AND ALL OF BUYER’S RIGHT, TITLE AND INTEREST IN, TO AND UNDER THIS
AGREEMENT, ON WHATEVER TERMS BUYER SHALL DETERMINE, PURSUANT TO THE RECEIVABLES
SALE AGREEMENT OR OTHERWISE.

 

(D)           BUYER SHALL HAVE THE SOLE RIGHT TO RETAIN ANY GAINS OR PROFITS
CREATED BY BUYING, SELLING OR HOLDING THE SPECIFIED ASSETS AND SHALL HAVE THE
SOLE RISK OF AND RESPONSIBILITY FOR LOSSES OR DAMAGES CREATED BY SUCH BUYING,
SELLING OR HOLDING.

 

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SECTION 7.2                 RESPONSIBILITIES OF THE SELLERS.  ANYTHING HEREIN TO
THE CONTRARY NOTWITHSTANDING, EACH SELLER HEREBY AGREES:

 

(A)           TO DELIVER DIRECTLY TO THE INITIAL COLLECTION AGENT (FOR BUYERS
ACCOUNT), WITHIN TWO BUSINESS DAYS AFTER RECEIPT AND IDENTIFICATION THEREOF, ANY
COLLECTIONS THAT IT RECEIVES IN THE FORM SO RECEIVED, AND AGREES THAT ALL SUCH
COLLECTIONS SHALL BE DEEMED TO BE RECEIVED IN TRUST FOR BUYER AND SHALL BE
MAINTAINED AND SEGREGATED SEPARATE AND APART FROM ALL OTHER FUNDS AND MONEYS OF
SUCH SELLER UNTIL DELIVERY OF SUCH COLLECTIONS TO THE INITIAL COLLECTION RESENT,

 

(B)           TO PERFORM ALL OF ITS OBLIGATIONS HEREUNDER AND UNDER THE
CONTRACTS RELATED TO THE RECEIVABLES AND RELATED ASSETS TO THE SAME EXTENT AS IF
THE RECEIVABLES HAD NOT BEEN SOLD HEREUNDER, AND THE EXERCISE BY BUYER OR ITS
DESIGNEE OR ASSIGNEE OF BUYER’S RIGHTS HEREUNDER OR IN CONNECTION HEREWITH SHALL
NOT RELIEVE SUCH SELLER FROM ANY OF ITS OBLIGATIONS UNDER THE CONTRACTS OR
RELATED ASSETS RELATED TO THE RECEIVABLES,

 

(C)           THAT IT HEREBY GRANTS BUYER AN IRREVOCABLE POWER OF ATTORNEY WITH
FULL POWER OF SUBSTITUTION, COUPLED WITH AN INTEREST TO TAKE IN THE NAME OF SUCH
SELLER ALL STEPS NECESSARY OR ADVISABLE TO ENDORSE, NEGOTIATE OR OTHERWISE
REALIZE ON ANY WRITING OR OTHER RIGHT OF ANY KIND HELD OR TRANSMITTED BY SUCH
SELLER OR TRANSMITTED OR RECEIVED BY BUYER (WHETHER OR NOT FROM SUCH SELLER) IN
CONNECTION WITH ANY SPECIFIED ASSET, AND

 

(D)           TO THE EXTENT THAT SUCH SELLER DOES NOT OWN THE COMPUTER SOFTWARE
THAT SUCH SELLER USES TO ACCOUNT FOR RECEIVABLES, SUCH SELLER SHALL PROVIDE
BUYER, THE AGENT AND THE PURCHASER AGENTS WITH SUCH LICENSES, SUBLICENSES AND/OR
ASSIGNMENTS OF CONTRACTS AS BUYER, THE AGENT OR THE PURCHASER AGENTS SHALL
REQUIRE WITH REGARD TO ALL SERVICES AND COMPUTER HARDWARE USED BY SUCH SELLER
THAT RELATE TO THE SERVICING OF THE SPECIFIED ASSETS.

 

SECTION 7.3                 FURTHER ACTION EVIDENCING PURCHASES.  EACH SELLER
AGREES THAT FROM TIME TO TIME, AT ITS EXPENSE, IT WILL PROMPTLY, UPON REASONABLE
REQUEST BY BUYER, INITIAL COLLECTION AGENT, THE AGENT, A PURCHASER AGENT OR A
PURCHASER, EXECUTE AND DELIVER ALL FURTHER INSTRUMENTS AND DOCUMENTS, AND TAKE
ALL FURTHER ACTION, IN ORDER TO PERFECT, PROTECT OR MORE FULLY EVIDENCE THE
PURCHASE BY BUYER OR CONTRIBUTION TO BUYER OF THE RECEIVABLES AND THE RELATED
ASSETS UNDER THIS AGREEMENT, OR TO ENABLE BUYER TO EXERCISE OR ENFORCE ANY OF
ITS RIGHTS UNDER ANY TRANSACTION DOCUMENTS.  EACH SELLER FURTHER AGREES THAT
FROM TIME TO TIME, AT ITS EXPENSE, IT WILL PROMPTLY, UPON REQUEST, TAKE ALL
ACTION THAT BUYER, THE INITIAL COLLECTION AGENT OR THE AGENT MAY REASONABLY
REQUEST IN ORDER TO PERFECT, PROTECT OR MORE FULLY EVIDENCE THE PURCHASE OR
CONTRIBUTION OF THE RECEIVABLES AND THE RELATED ASSETS OR TO ENABLE BUYER OR THE
AGENT (AS THE ASSIGNEE OF BUYER) TO EXERCISE OR ENFORCE ANY OF ITS RIGHTS
HEREUNDER OR UNDER ANY OTHER TRANSACTION DOCUMENT. WITHOUT LIMITING THE
GENERALITY OF THE FOREGOING, UPON THE REQUEST OF BUYER, EACH SELLER WILL:

 

(A)           EXECUTE AND FILE SUCH UCC FINANCING OR CONTINUATION STATEMENTS, OR
AMENDMENTS THERETO OR ASSIGNMENTS THEREOF, AND SUCH OTHER INSTRUMENTS OR
NOTICES, AS BUYER OR THE AGENT MAY REASONABLY DETERMINE TO BE NECESSARY OR
APPROPRIATE, AND

 

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(B)           MARK THE MASTER DATA PROCESSING RECORDS EVIDENCING THE RECEIVABLES
WITH THE FOLLOWING LEGEND:

 

“THE RECEIVABLES DESCRIBED HEREIN HAVE BEEN SOLD TO CROMPTON & KNOWLES
RECEIVABLES CORPORATION PURSUANT TO AN AMENDED AND RESTATED RECEIVABLES PURCHASE
AGREEMENT, DATED AS OF SEPTEMBER 28, 2006,  AMONG CHEMTURA CORPORATION
(“CHEMTURA”) AS INITIAL COLLECTION AGENT AND SELLER, CERTAIN SUBSIDIARIES OF
CHEMTURA,  AS SELLERS, AND CROMPTON & KNOWLES RECEIVABLES CORPORATION.”

 

Each Seller hereby authorizes Buyer or its designee to file one or more UCC
financing or continuation statements, and amendments thereto and assignments
thereof, relative to all or any of the Receivables and Related Assets of such
Seller, in each case whether now existing or hereafter generated by such Seller.
Except for material performance obligations of such Seller to any Obligor
hereunder or under any contracts relating to such Obligor, if (i) such Seller
fails to perform any of its agreements or obligations under this Agreement and
does not remedy the failure within the applicable cure period, if any, and
(ii) Buyer in good faith reasonably believes that the performance of such
agreements and obligations is necessary or appropriate to protect its interests
under this Agreement, then Buyer or its designee may (but shall not be required
to) perform, or cause performance of, such agreement or obligation and the
reasonable expenses of Buyer or its designee or assignee incurred in connection
with such performance shall be payable by such Seller as provided in
Section 9.1.

 

SECTION 7.4                 COLLECTION OF RECEIVABLES, RIGHTS OF BUYER AND ITS
ASSIGNEES.  (A) EACH SELLER HEREBY TRANSFERS TO THE AGENT ON BEHALF OF THE
PURCHASERS (AS TRANSFEREE OF BUYER’S INTEREST IN THE SPECIFIED ASSETS) THE
OWNERSHIP OF, AND THE EXCLUSIVE DOMINION AND CONTROL OVER, EACH OF THE BANK
ACCOUNTS AND ALL RELATED LOCKBOXES OWNED BY SUCH SELLER, AND SUCH SELLER HEREBY
AGREES TO TAKE ANY FURTHER ACTION THAT BUYER OR THE AGENT MAY REASONABLY REQUEST
IN ORDER TO EFFECT OR COMPLETE THE TRANSFER. EACH SELLER FURTHER AGREES TO USE
REASONABLE EFFORTS TO PREVENT FUNDS OTHER THAN PROCEEDS OF THE SPECIFIED ASSETS
FROM BEING DEPOSITED IN ANY BANK ACCOUNT.

 

(B)           EACH SELLER SHALL, AT THE REQUEST OF BUYER AND AT SUCH SELLER’S
EXPENSE, PROMPTLY GIVE NOTICE OF INTEREST IN THE RECEIVABLES OF THE OBLIGOR AND
THE RELATED ASSETS TO EACH SUCH OBLIGOR AND DIRECT THAT PAYMENTS BE MADE
DIRECTLY TO THE AGENT OR ITS DESIGNEE, WHICH NOTICE SHALL BE ACCEPTABLE IN FORM
AND SUBSTANCE TO BUYER.  IN ADDITION, EACH SELLER HEREBY AUTHORIZES BUYER TO
TAKE ANY AND ALL STEPS IN SUCH SELLER’S NAME AND ON ITS BEHALF THAT ARE
NECESSARY OR DESIRABLE, IN THE REASONABLE DETERMINATION OF BUYER, TO COLLECT ALL
AMOUNTS DUE UNDER ANY AND ALL SPECIFIED ASSETS, INCLUDING ENDORSING SUCH
SELLER’S NAME ON CHECKS AND OTHER INSTRUMENTS REPRESENTING COLLECTIONS AND
ENFORCING THE SPECIFIED ASSETS AND THE CONTRACTS RELATED TO THE RECEIVABLES.

 

ARTICLE VIII
TERMINATION

 

SECTION 8.1                 TERMINATION BY THE SELLERS.  THE SELLERS MAY
TERMINATE ALL OF THEIR AGREEMENTS TO SELL RECEIVABLES HEREUNDER TO BUYER BY
GIVING BUYER AND THE AGENT NOT LESS THAN

 

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FIVE BUSINESS DAYS PRIOR WRITTEN NOTICE OF THEIR ELECTION NOT TO CONTINUE TO
SELL RECEIVABLES TO BUYER (THE “TERMINATION OF SALE NOTICE”); PROVIDED THAT THE
TERMINATION OF SALE NOTICE MUST SPECIFY THE EFFECTIVE DATE OF TERMINATION.

 

SECTION 8.2                 AUTOMATIC TERMINATION.  (A) THE AGREEMENT OF BUYER
TO PURCHASE RECEIVABLES FROM A SELLER HEREUNDER SHALL TERMINATE AUTOMATICALLY
UPON (I) THE FIRST DATE ON WHICH AN EVENT SPECIFIED IN THE DEFINITION OF
BANKRUPTCY EVENT OCCURS AS A RESULT OF A CASE OR PROCEEDING BEING FILED AGAINST
SUCH SELLER, (II) THE FIRST DATE ON WHICH CHEMTURA CORPORATION FAILS TO OWN AND
CONTROL, DIRECTLY OR INDIRECTLY, ONE HUNDRED PERCENT (100%) OF THE OUTSTANDING
VOTING STOCK OF SUCH SELLER (OTHER THAN CHEMTURA CORPORATION) OR (III) THE
OCCURRENCE OF A TERMINATION EVENT, AS DEFINED IN THE RECEIVABLES SALE AGREEMENT.
THE TERMINATION REFERRED TO IN CLAUSES (I) AND (II) OF THE PROCEEDING SENTENCE
SHALL APPLY ONLY TO THE RELEVANT SELLER AND THE TERMINATION REFERRED TO IN
CLAUSE (III) SHALL APPLY TO ALL SELLERS.”

 

(B)           IF THE INTERNAL REVENUE SERVICE OR THE PBGC FILES ONE MORE TAX OR
ERISA LIENS AGAINST THE ASSETS OF BUYER OR ANY SELLER (INCLUDING RECEIVABLES),
THEN (AND FOR SO LONG AS SUCH TAX OR ERISA LIENS REMAIN IN PLACE) BUYER SHALL
NOT PURCHASE ANY RECEIVABLES OR RELATED ASSETS FROM SUCH SELLER (OR FROM ANY
SELLER IF SUCH TAX OR ERISA LIEN IS FILED AGAINST BUYER).

 

ARTICLE IX

INDEMNIFICATION

 

SECTION 9.1                 INDEMNITIES BY THE SELLER.  WITHOUT LIMITING ANY
OTHER RIGHTS ANY PERSON MAY HAVE HEREUNDER OR UNDER APPLICABLE LAW, EACH SELLER,
ON A SEVERAL BASIS, HEREBY INDEMNIFIES AND HOLDS HARMLESS, ON AN AFTER-TAX
BASIS, THE BUYER, THE AGENT, THE PURCHASER AGENTS AND EACH PURCHASER AND THEIR
RESPECTIVE OFFICERS, DIRECTORS, AGENTS AND EMPLOYEES, (EACH AN “INDEMNIFIED
PARTY”) FROM AND AGAINST ANY AND ALL DAMAGES, LOSSES, CLAIMS, LIABILITIES,
PENALTIES, TAXES, COSTS AND EXPENSES (INCLUDING ATTORNEYS’ FEES AND COURT COSTS)
(ALL OF THE FOREGOING COLLECTIVELY, THE “INDEMNIFIED LOSSES”) AT ANY TIME
IMPOSED ON OR INCURRED BY ANY INDEMNIFIED PARTY ARISING OUT OF OR OTHERWISE
RELATING TO ANY TRANSACTION DOCUMENT, THE TRANSACTIONS CONTEMPLATED THEREBY OR
THE ACQUISITION OF ANY PORTION OF THE SOLD INTEREST, OR ANY ACTION TAKEN OR
OMITTED BY ANY OF THE INDEMNIFIED PARTIES (INCLUDING ANY ACTION TAKEN BY THE
AGENT AS ATTORNEY-IN-FACT FOR THE SELLER PURSUANT TO SECTION 3.5(B), WHETHER
ARISING BY REASON OF THE ACTS TO BE PERFORMED BY THE SELLER HEREUNDER OR
OTHERWISE, EXCLUDING ONLY INDEMNIFIED LOSSES TO THE EXTENT (A) A FINAL JUDGMENT
OF A COURT OF COMPETENT JURISDICTION HOLDS SUCH INDEMNIFIED LOSSES RESULTED
SOLELY FROM GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THE INDEMNIFIED PARTY
SEEKING INDEMNIFICATION, (B) SOLELY DUE TO THE CREDIT RISK OF THE OBLIGOR AND
FOR WHICH REIMBURSEMENT WOULD CONSTITUTE RECOURSE TO THE SELLER FOR
UNCOLLECTIBLE RECEIVABLES OR (C) SUCH INDEMNIFIED LOSSES INCLUDE TAXES ON, OR
MEASURED BY, THE OVERALL NET INCOME OF THE AGENT, ANY PURCHASER AGENT OR ANY
PURCHASER COMPUTED IN ACCORDANCE WITH THE INTENDED TAX CHARACTERIZATION;
PROVIDED, HOWEVER, THAT NOTHING CONTAINED IN THIS SENTENCE SHALL LIMIT THE
LIABILITY OF THE SELLER OR LIMIT THE RECOURSE OF EACH INDEMNIFIED PARTY TO THE
SELLER FOR ANY AMOUNTS OTHERWISE SPECIFICALLY PROVIDED TO BE PAID BY THE SELLER
HEREUNDER. WITHOUT LIMITING THE FOREGOING INDEMNIFICATION, BUT SUBJECT TO THE
LIMITATIONS SET FORTH IN CLAUSES (A), (B) AND (C) OF THE PREVIOUS SENTENCE, THE
SELLER SHALL INDEMNIFY EACH INDEMNIFIED PARTY FOR INDEMNIFIED LOSSES (INCLUDING
LOSSES IN RESPECT OF UNCOLLECTIBLE RECEIVABLES, REGARDLESS FOR THESE SPECIFIC
MATTERS

 

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WHETHER REIMBURSEMENT THEREFORE WOULD CONSTITUTE RECOURSE TO THE SELLER)
RELATING TO OR RESULTING FROM:

 

(I)            ANY REPRESENTATION OR WARRANTY MADE BY THE SELLER (OR ANY
EMPLOYEE OR AGENT OF THE SELLER) UNDER OR IN CONNECTION WITH THIS AGREEMENT OR
ANY OTHER INFORMATION OR REPORT DELIVERED BY THE SELLER PURSUANT HERETO, WHICH
SHALL HAVE BEEN FALSE OR INCORRECT IN ANY MATERIAL RESPECT WHEN MADE OR DEEMED
MADE;

 

(II)           THE FAILURE BY THE SELLER TO COMPLY WITH ANY APPLICABLE LAW,
RULE OR REGULATION RELATED TO ANY RECEIVABLE, OR THE NONCONFORMITY OF ANY
RECEIVABLE WITH ANY SUCH APPLICABLE LAW, RULE OR REGULATION;

 

(III)          THE FAILURE OF THE SELLER TO VEST AND MAINTAIN VESTED IN THE
AGENT, FOR THE BENEFIT OF THE PURCHASERS, A PERFECTED OWNERSHIP OR SECURITY
INTEREST IN THE SPECIFIED ASSETS, FREE AND CLEAR OF ANY ADVERSE CLAIM;

 

(IV)          ANY COMMINGLING OF FUNDS TO WHICH THE AGENT OR ANY PURCHASER IS
ENTITLED HEREUNDER WITH ANY OTHER FUNDS;

 

(V)           ANY FAILURE OF A LOCK-BOX BANK TO COMPLY WITH THE TERMS OF THE
APPLICABLE LOCK-BOX LETTER;

 

(VI)          ANY DISPUTE, CLAIM, OFFSET OR DEFENSE (OTHER THAN DISCHARGE IN
BANKRUPTCY OF THE OBLIGOR) OF THE OBLIGOR TO THE PAYMENT OF ANY RECEIVABLE, OR
ANY OTHER CLAIM RESULTING FROM THE SALE OR LEASE OF GOODS OR THE RENDERING OF
SERVICES RELATED TO SUCH RECEIVABLE OR THE FURNISHING OR FAILURE TO FURNISH ANY
GOODS OR SERVICES OR OTHER SIMILAR CLAIM OR DEFENSE NOT ARISING FROM THE
FINANCIAL INABILITY OF ANY OBLIGOR TO PAY UNDISPUTED INDEBTEDNESS;

 

(VII)         ANY FAILURE OF THE SELLER, TO PERFORM ITS DUTIES OR OBLIGATIONS IN
ACCORDANCE WITH THE PROVISIONS OF THIS AGREEMENT OR ANY OTHER TRANSACTION
DOCUMENT TO WHICH SUCH PERSON IS A PARTY (AS A COLLECTION AGENT OR OTHERWISE);

 

(VIII)        ANY ACTION TAKEN BY THE AGENT AS ATTORNEY-IN-FACT FOR THE SELLER;
OR

 

(IX)           ANY ENVIRONMENTAL LIABILITY CLAIM, PRODUCTS LIABILITY CLAIM OR
PERSONAL INJURY OR PROPERTY DAMAGE SUIT OR OTHER SIMILAR OR RELATED CLAIM OR
ACTION OF WHATEVER SORT, ARISING OUT OF OR IN CONNECTION WITH ANY RECEIVABLE OR
ANY OTHER SUIT, CLAIM OR ACTION OF WHATEVER SORT RELATING TO ANY OF THE
TRANSACTION DOCUMENTS.

 

ARTICLE X

MISCELLANEOUS

 

SECTION 10.1               AMENDMENTS; WAIVERS, ETC.  (A) THE PROVISIONS OF THIS
AGREEMENT MAY FROM TIME TO TIME BE AMENDED, MODIFIED OR WAIVED, IF SUCH
AMENDMENT, MODIFICATION OR WAIVER IS IN WRITING AND SIGNED BY BUYER, EACH SELLER
AND THE AGENT (ACTING AT THE DIRECTION OF THE INSTRUCTING GROUP), AND THEN ANY
SUCH WAIVER OR CONSENT SHALL BE EFFECTIVE ONLY IN THE SPECIFIC INSTANCE AND FOR
THE SPECIFIC PURPOSE FOR WHICH GIVEN.

 

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(B)           NO FAILURE OR DELAY ON THE PART OF BUYER, THE AGENT OR ANY OTHER
THIRD PARTY BENEFICIARY REFERRED TO IN SECTION 10.11(A) IN EXERCISING ANY POWER
OR RIGHT HEREUNDER SHALL OPERATE AS A WAIVER THEREOF, NOR SHALL ANY SINGLE OR
PARTIAL EXERCISE OF ANY SUCH POWER OR RIGHT PRECLUDE ANY OTHER OR FURTHER
EXERCISE THEREOF OR THE EXERCISE OF ANY OTHER POWER OR RIGHT. NO NOTICE TO OR
DEMAND ON ANY SELLER IN ANY CASE SHALL ENTITLE IT TO ANY NOTICE OR DEMAND IN
SIMILAR OR OTHER CIRCUMSTANCES. NO WAIVER OR APPROVAL BY BUYER OR THE AGENT
UNDER THIS AGREEMENT SHALL, EXCEPT AS MAY OTHERWISE BE STATED IN THE WAIVER OR
APPROVAL, BE APPLICABLE TO SUBSEQUENT TRANSACTIONS. NO WAIVER OR APPROVAL UNDER
THIS AGREEMENT SHALL REQUIRE ANY SIMILAR OR DISSIMILAR WAIVER OR APPROVAL
THEREAFTER TO BE GRANTED HEREUNDER.

 

SECTION 10.2               NOTICES, ETC.  ALL NOTICES, DEMANDS, INSTRUCTIONS AND
OTHER COMMUNICATIONS PROVIDED FOR HEREUNDER SHALL, UNLESS OTHERWISE STATED
HEREIN, BE IN WRITING (INCLUDING FACSIMILE COMMUNICATION) AND SHALL BE
PERSONALLY DELIVERED OR SENT BY CERTIFIED MAIL, POSTAGE PREPAID, BY FACSIMILE OR
BY OVERNIGHT COURIER, TO THE INTENDED PARTY AT THE ADDRESS OR FACSIMILE NUMBER
OF SUCH PARTY SET FORTH UNDER ITS NAME ON THE SIGNATURE PAGES HEREOF OR AT SUCH
OTHER ADDRESS OR FACSIMILE NUMBER AS SHALL BE DESIGNATED BY THE PARTY IN A
WRITTEN NOTICE TO THE OTHER PARTIES HERETO GIVEN IN ACCORDANCE WITH THIS
SECTION.  COPIES OF ALL NOTICES, DEMANDS, INSTRUCTIONS AND OTHER COMMUNICATIONS
PROVIDED FOR HEREUNDER SHALL BE DELIVERED TO THE AGENT AT ITS ADDRESS FOR
NOTICES SET FORTH IN THE RECEIVABLES SALE AGREEMENT. ALL NOTICES AND
COMMUNICATIONS PROVIDED FOR HEREUNDER SHALL BE EFFECTIVE, (A) IF PERSONALLY
DELIVERED, WHEN RECEIVED, (B) IF SENT BY CERTIFIED MAIL, FOUR BUSINESS DAYS
AFTER HAVING BEEN DEPOSITED IN THE MAIL, POSTAGE PREPAID AND PROPERLY ADDRESSED,
(C) IF TRANSMITTED BY FACSIMILE, WHEN SENT, RECEIPT CONFIRMED BY TELEPHONE OR
ELECTRONIC MEANS AND (D) IF SENT BY OVERNIGHT COURIER, TWO BUSINESS DAYS AFTER
HAVING BEEN GIVEN TO THE COURIER UNLESS SOONER RECEIVED BY THE ADDRESSEE.

 

SECTION 10.3               CUMULATIVE REMEDIES.  THE REMEDIES HEREIN PROVIDED
ARE CUMULATIVE AND NOT EXCLUSIVE OF ANY REMEDIES PROVIDED BY LAW. WITHOUT
LIMITING THE FOREGOING, EACH SELLER HEREBY AUTHORIZES BUYER, AT ANY TIME AND
FROM TIME TO TIME, TO THE FULLEST EXTENT PERMITTED BY LAW, TO SET-OFF, AGAINST
ANY OBLIGATIONS OF ANY SELLER TO BUYER THAT ARE THEN DUE AND PAYABLE OR THAT ARE
NOT THEN DUE AND PAYABLE FROM A SELLER TO BUYER BUT HAVE THEN ACCRUED, ANY AND
ALL INDEBTEDNESS OR OTHER OBLIGATIONS AT ANY TIME OWING TO ANY SELLER BY BUYER
TO OR FOR THE CREDIT OR THE ACCOUNT OF ANY SELLER OR THAT ARE NOT THEN DUE AND
PAYABLE FROM BUYER TO A SELLER BUT HAVE THEN ACCRUED.

 

SECTION 10.4               BINDING EFFECT; ASSIGNABILITY; SURVIVAL OF
PROVISIONS.  THIS AGREEMENT SHALL BE BINDING UPON AND INURE TO THE BENEFIT OF
BUYER AND THE SELLERS AND THEIR RESPECTIVE SUCCESSORS AND PERMITTED ASSIGNS. NO
SELLER MAY ASSIGN ANY OF ITS RIGHTS HEREUNDER OR ANY INTEREST HEREIN WITHOUT THE
PRIOR WRITTEN CONSENT OF BUYER AND THE AGENT. THIS AGREEMENT SHALL CREATE AND
CONSTITUTE THE CONTINUING OBLIGATIONS OF THE PARTIES HERETO IN ACCORDANCE WITH
ITS TERMS, AND SHALL REMAIN IN FULL FORCE AND EFFECT UNTIL THE FIRST DATE
FOLLOWING THE PURCHASE TERMINATION DATE, ON WHICH ALL OBLIGATIONS SHALL HAVE
BEEN FINALLY AND FULLY PAID AND PERFORMED OR SUCH OTHER TIME AS THE PARTIES
HERETO SHALL AGREE AND AS TO WHICH THE AGENT SHALL HAVE GIVEN ITS PRIOR WRITTEN
CONSENT, WHICH CONSENT SHALL NOT BE UNREASONABLY WITHHELD OR DELAYED.  THE
RIGHTS AND REMEDIES WITH RESPECT TO ANY BREACH OF ANY REPRESENTATION AND
WARRANTY MADE BY A SELLER PURSUANT TO ARTICLE V OR OF ANY COVENANT MADE BY A
SELLER IN ARTICLE VI, THE INDEMNIFICATION AND PAYMENT PROVISIONS OF ARTICLE IX
AND SECTION 10.6, AND THE PROVISIONS OF SECTIONS 10.3, 10.4, 10.5, 10.7, 10.8,
10.9,

 

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10.11, 10.12, 10.13, AND 10.15, SHALL BE CONTINUING AND SHALL SURVIVE ANY
TERMINATION OF THIS AGREEMENT.

 

SECTION 10.5               GOVERNING LAW.  THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF
LAWS PRINCIPLES, EXCEPT TO THE EXTENT THAT THE PERFECTION OF THE INTERESTS OF
BUYER IN THE RECEIVABLES AND THE RELATED ASSETS ARE GOVERNED BY THE LAWS OF A
JURISDICTION OTHER THAN THE STATE OF NEW YORK.

 

SECTION 10.6               COSTS, EXPENSES AND TAXES.  IN ADDITION TO THE
OBLIGATIONS OF THE SELLERS UNDER ARTICLE IX; THE SELLERS AGREE JOINTLY AND
SEVERALLY TO PAY ON DEMAND:

 

(A)           ALL REASONABLE OUT-OF-POCKET AND OTHER COSTS AND EXPENSES IN
CONNECTION WITH THE ENFORCEMENT OF THIS AGREEMENT. THE SELLER ASSIGNMENT
CERTIFICATES OR THE OTHER TRANSACTION DOCUMENTS BY BUYER OR ANY SUCCESSOR IN
INTEREST TO BUYER, AND

 

(B)           ALL STAMP AND OTHER TAXES AND FEES PAYABLE OR DETERMINED TO BE
PAYABLE IN CONNECTION WITH THE EXECUTION AND DELIVERY, AND THE FILING AND
RECORDING, OF THIS AGREEMENT OR THE OTHER TRANSACTION DOCUMENTS, AND AGREES TO
INDEMNIFY EACH INDEMNIFIED PARTY AGAINST ANY LIABILITIES WITH RESPECT TO OR
RESULTING FROM ANY DELAY IN PAYING OR OMISSION TO PAY THE TAXES AND FEES.

 

SECTION 10.7               SUBMISSION TO JURISDICTION.  EACH PARTY HERETO HEREBY
(A) IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY NEW YORK STATE
OR FEDERAL COURT SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK,
NEW YORK OVER ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THE
TRANSACTION DOCUMENTS, (B) IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF THE
ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH STATE OR FEDERAL COURT,
(C) 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, AND (D) IRREVOCABLY APPOINTS CT CORPORATION, AS ITS AGENT TO RECEIVE
ON BEHALF OF IT AND ITS PROPERTY SERVICE OF COPIES OF THE SUMMONS AND COMPLAINT
AND ANY OTHER PROCESS THAT MAY BE SERVED IN SUCH ACTION OR PROCEEDING. THE
SERVICE MAY BE MADE BY MAILING OR DELIVERING A COPY OF THE PROCESS TO BUYER OR
THE APPLICABLE SELLER IN CARE OF THE PROCESS AGENT AT THE PROCESS AGENT’S ABOVE
ADDRESS, AND BUYER AND EACH SELLER HEREBY IRREVOCABLY AUTHORIZES AND DIRECTS THE
PROCESS AGENT TO ACCEPT THE SERVICE ON ITS BEHALF.

 

As an alternative method of service, each of Buyer and the Sellers also
irrevocably consents to the service of any and all process in such action or
proceeding by the mailing of copies of the process to Buyer or a Seller (as
applicable) at its address specified herein. Nothing in this section shall
affect the right of any party hereto to serve legal process in any other manner
permitted by law or affect the right of any party hereto to bring any action or
proceeding against any or all of the other parties hereto or any of their
respective properties in the courts of any other jurisdiction.

 

SECTION 10.8               WAIVER OF JURY TRIAL.  EACH PARTY HERETO WAIVES ANY
RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY
RIGHTS UNDER OR RELATING TO THE

 

27

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TRANSACTION DOCUMENTS OR ANY AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT
DELIVERED OR THAT MAY IN THE FUTURE BE DELIVERED IN CONNECTION THEREWITH OR
ARISING FROM ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER
VERBAL OR WRITTEN), ACTIONS OF ANY OF THE PARTIES HERETO OR ANY OTHER
RELATIONSHIP EXISTING IN CONNECTION WITH THE TRANSACTION DOCUMENTS, AND AGREES
THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE
A JURY.

 

SECTION 10.9               INTEGRATION.  THIS AGREEMENT AND THE OTHER
TRANSACTION DOCUMENTS CONTAIN A FINAL AND COMPLETE INTEGRATION OF ALL PRIOR
EXPRESSIONS BY THE PARTIES HERETO WITH RESPECT TO THE SUBJECT MATTER HEREOF AND
THEREOF AND SHALL TOGETHER CONSTITUTE THE ENTIRE AGREEMENT BETWEEN THE PARTIES
HERETO WITH RESPECT TO THE SUBJECT MATTER HEREOF AND THEREOF, SUPERSEDING ALL
PRIOR ORAL OR WRITTEN UNDERSTANDINGS.

 

SECTION 10.10             COUNTERPARTS.  THIS AGREEMENT MAY BE EXECUTED IN ANY
NUMBER OF COUNTERPARTS AND BY DIFFERENT PARTIES HERETO IN SEPARATE COUNTERPARTS,
EACH OF WHICH WHEN SO EXECUTED SHALL BE DEEMED TO BE AN ORIGINAL AND ALL OF
WHICH TOGETHER SHALL CONSTITUTE ONE AND THE SAME AGREEMENT.

 

SECTION 10.11             ACKNOWLEDGMENT AND CONSENT.  (A) THE SELLERS
ACKNOWLEDGE THAT, CONTEMPORANEOUSLY HEREWITH, BUYER IS SELLING, TRANSFERRING,
ASSIGNING, SETTING, GRANTING, OVER AND OTHERWISE CONVEYING TO THE AGENT ALL OF
BUYER’S RIGHT, TITLE AND INTEREST IN, TO AND UNDER THE SPECIFIED ASSETS, THIS
AGREEMENT AND ALL OF THE OTHER TRANSACTION DOCUMENTS PURSUANT TO THE RECEIVABLES
SALE AGREEMENT. THE SELLERS HEREBY CONSENT TO THE SALE, TRANSFER, ASSIGNMENT,
SET OVER AND CONVEYANCE TO THE AGENT BY BUYER OF ALL RIGHT, TITLE AND INTEREST
OF BUYER IN, TO AND UNDER THE SPECIFIED ASSETS, THIS AGREEMENT AND THE OTHER
TRANSACTION DOCUMENTS, AND ALL OF BUYER’S RIGHTS, REMEDIES, POWERS AND
PRIVILEGES, AND ALL CLAIMS OF BUYER AGAINST THE SELLERS, UNDER OR WITH RESPECT
TO THIS AGREEMENT AND THE OTHER TRANSACTION DOCUMENTS (WHETHER ARISING PURSUANT
TO THE TERMS OF THIS AGREEMENT OR OTHERWISE AVAILABLE AT LAW, OR IN EQUITY),
INCLUDING (I) THE RIGHT OF BUYER, AT ANY TIME, TO ENFORCE THIS AGREEMENT AGAINST
THE SELLERS AND THE OBLIGATIONS OF THE SELLERS HEREUNDER, (II) THE RIGHT TO
APPOINT A SUCCESSOR TO THE INITIAL COLLECTION AGENT AT THE TIMES AND UPON THE
CONDITIONS SET FORTH IN THE RECEIVABLES SALE AGREEMENT, AND (III) THE RIGHT, AT
ANY TIME, TO GIVE OR WITHHOLD ANY AND ALL CONSENTS, REQUESTS, NOTICES,
DIRECTIONS, APPROVALS, DEMANDS, EXTENSIONS OR WAIVERS UNDER OR WITH RESPECT TO
THIS AGREEMENT, ANY OTHER TRANSACTION DOCUMENT OR THE OBLIGATIONS IN RESPECT OF
THE SELLERS THEREUNDER TO THE SAME EXTENT AS BUYER MAY DO. EACH OF THE PARTIES
HERETO ACKNOWLEDGES AND AGREES THAT THE AGENT, THE PURCHASER AGENTS AND THE
PURCHASERS ARE THIRD PARTY BENEFICIARIES OF THE RIGHTS OF BUYER ARISING
HEREUNDER AND UNDER THE OTHER TRANSACTION DOCUMENTS TO WHICH ANY SELLER IS A
PARTY. EACH SELLER HEREBY ACKNOWLEDGES AND AGREES THAT IT HAS NO CLAIM TO OR
INTEREST IN ANY OF THE BANK ACCOUNTS OR THE TRANSACTION ACCOUNTS.

 

(B)           THE SELLERS HEREBY AGREE TO EXECUTE ALL AGREEMENTS, INSTRUMENTS
AND DOCUMENTS, AND TO TAKE ALL OTHER ACTION, THAT BUYER OR THE AGENT REASONABLY
DETERMINES IS NECESSARY OR APPROPRIATE TO EVIDENCE THE CONSENTS, AGREEMENTS AND
ACKNOWLEDGEMENTS DESCRIBED IN SUBSECTION (A) ABOVE.  TO THE EXTENT THAT BUYER,
INDIVIDUALLY OR THROUGH THE INITIAL COLLECTION AGENT, HAS GRANTED OR GRANTS
POWERS OF ATTORNEY TO THE AGENT UNDER THE RECEIVABLES SALE AGREEMENT, THE
SELLERS HEREBY GRANT A CORRESPONDING POWER OF ATTORNEY ON THE SAME TERMS TO
BUYER. THE SELLERS HEREBY ACKNOWLEDGE AND AGREE THAT BUYER, IN ALL OF ITS
CAPACITIES, SHALL ASSIGN TO THE AGENT FOR

 

28

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THE BENEFIT OF THE PURCHASERS THE POWERS OF ATTORNEY AND OTHER RIGHTS AND
INTERESTS GRANTED BY THE SELLERS TO BUYER HEREUNDER AND AGREES TO COOPERATE
FULLY WITH THE AGENT IN THE EXERCISE OF THE RIGHTS.

 

SECTION 10.12             NO PARTNERSHIP OR JOINT VENTURE.  NOTHING CONTAINED IN
THIS AGREEMENT SHALL BE DEEMED OR CONSTRUED BY THE PARTIES HERETO OR BY ANY
THIRD PERSON TO CREATE THE RELATIONSHIP OF PRINCIPAL AND AGENT OR OF PARTNERSHIP
OR OF JOINT VENTURE.

 

SECTION 10.13             NO PROCEEDINGS.  EACH SELLER HEREBY AGREES THAT IT
WILL NOT INSTITUTE AGAINST BUYER OR ANY CONDUIT PURCHASER, OR JOIN ANY OTHER
PERSON IN INSTITUTING, AGAINST BUYER OR ANY CONDUIT PURCHASER (AS SUCH TERM IS
DEFINED IN THE RECEIVABLES SALE AGREEMENT), ANY PROCEEDING OF THE TYPE REFERRED
TO IN THE DEFINITION OF BANKRUPTCY EVENT SO LONG AS THERE SHALL NOT HAVE ELAPSED
ONE YEAR PLUS ONE DAY SINCE THE LAST DAY ON WHICH ANY SUCH INVESTMENT SHALL HAVE
BEEN OUTSTANDING.  THE FOREGOING SHALL NOT LIMIT THE RIGHT OF A SELLER TO FILE
ANY CLAIM IN OR OTHERWISE TAKE ANY ACTION WITH RESPECT TO ANY SUCH PROCEEDING
THAT WAS INSTITUTED AGAINST BUYER OR ANY CONDUIT PURCHASER (AS SUCH TERM IS
DEFINED IN THE RECEIVABLES SALE AGREEMENT) BY ANY PERSON OTHER THAN A SELLER OR
THE PARENT (PROVIDED THAT NO SUCH ACTION MAY BE TAKEN BY A SELLER UNTIL SUCH
PROCEEDING HAS CONTINUED UNDISMISSED, UNSTAYED AND IN EFFECT FOR A PERIOD OF 10
DAYS).

 

SECTION 10.14             SEVERABILITY OF PROVISIONS.  IF ANY ONE OR MORE OF THE
COVENANTS, AGREEMENTS, PROVISIONS OR TERMS OF THIS AGREEMENT OR ANY OF THE OTHER
TRANSACTION DOCUMENTS SHALL FOR ANY REASON WHATSOEVER BE HELD INVALID, THEN THE
UNENFORCEABLE COVENANTS, AGREEMENTS, PROVISIONS OR TERMS SHALL BE DEEMED
SEVERABLE FROM THE REMAINING COVENANTS, AGREEMENTS, PROVISIONS OR TERMS OF THIS
AGREEMENT OR THE OTHER TRANSACTION DOCUMENTS (AS APPLICABLE) AND SHALL IN NO WAY
AFFECT THE VALIDITY OR ENFORCEABILITY OF THE OTHER PROVISIONS OF THIS AGREEMENT
OR ANY OF THE OTHER TRANSACTION DOCUMENTS.

 

SECTION 10.15             RECOURSE TO BUYER.  EXCEPT TO THE EXTENT EXPRESSLY
PROVIDED OTHERWISE IN THE TRANSACTION DOCUMENTS, THE OBLIGATIONS OF BUYER UNDER
THE TRANSACTION DOCUMENTS TO WHICH IT IS A PARTY ARE SOLELY THE OBLIGATIONS OF
BUYER. NO RECOURSE SHALL BE HAD FOR PAYMENT OF ANY FEE PAYABLE BY OR OTHER
OBLIGATION OF OR CLAIM AGAINST BUYER THAT ARISES OUT OF ANY TRANSACTION DOCUMENT
TO WHICH BUYER IS A PARTY AGAINST ANY DIRECTOR, OFFICER OR EMPLOYEE OF BUYER.
THE PROVISIONS OF THIS SECTION SHALL SURVIVE THE TERMINATION OF THIS AGREEMENT.

 

SECTION 10.16             AUTHORIZATION TO FILE FINANCING STATEMENTS.  EACH OF
THE SELLERS HEREBY IRREVOCABLY AUTHORIZES EACH OF THE BUYER AND ITS ASSIGNEES,
AT ANY TIME, AND FROM TIME TO TIME, TO FILE IN ANY FILING OFFICE IN ANY
JURISDICTION ANY INITIAL FINANCING STATEMENTS AND AMENDMENTS THERETO THAT
INDICATE THE SPECIFIED ASSETS AS COLLATERAL, AND HEREBY RATIFIES THE FILING OF
ANY INITIAL FINANCING STATEMENTS OR AMENDMENTS THERETO FILED BY THE BUYER OR ITS
ASSIGNEES THAT INDICATE THE SPECIFIED ASSETS AS COLLATERAL WHICH WERE FILED
PRIOR TO THE EXECUTION OF THIS AGREEMENT.

 

SECTION 10.17             EFFECT ON ORIGINAL AGREEMENT.  NOTWITHSTANDING THAT
THIS AGREEMENT IS AMENDED AND RESTATED AS OF SEPTEMBER 28, 2006, NOTHING
CONTAINED HEREIN SHALL BE DEEMED TO CAUSE A NOVATION OF THE TRANSACTIONS,
TRANSFERS AND INDEBTEDNESS EFFECTED UNDER THE ORIGINAL AGREEMENT, AS AMENDED AND
SUPPLEMENTED TO DATE AND ALL OF THE BUYER NOTES PREVIOUSLY EXECUTED.  ALL BUYER
NOTES ISSUED PURSUANT TO THE TERMS OF THE ORIGINAL AGREEMENT REMAIN IN FULL

 

29

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FORCE AND EFFECT AND ALL REFERENCES TO THE ORIGINAL AGREEMENT CONTAINED THEREIN
ARE HEREBY AMENDED TO REFER TO THIS AGREEMENT, AS IT MAY BE AMENDED, MODIFIED OR
SUPPLEMENTED FROM TIME TO TIME.

 

 [SIGNATURES FOLLOW]

 

30

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

 

 

CHEMTURA CORPORATION (as successor to Crompton
& Knowles Corporation),

 

as Initial Collection Agent and as Seller

 

 

 

 

 

By:

 /s/ Eric Wisnefsky

 

Title:

Vice President Corporate Finance and Treasurer

 

 

 

 

 

 

 

 

 

 

 

Address:

199 Benson Road

 

 

 

Middlebury, Connecticut 06749

 

Attention:

 Treasurer

 

 

 

 

 

 

 

 

 

 

CHEMTURA USA CORPORATION, as Seller

 

 

 

 

 

 

By:

/s/ Eric Wisnefsky

 

 

Title:

Treasurer

 

 

 

 

 

 

 

 

 

 

 

Address:

199 Benson Road

 

 

 

Middlebury, Connecticut 06749

 

Attention:

Treasurer

 

 

 

 

 

 

 

 

 

 

GREAT LAKES CHEMICAL CORPORATION, as Seller

 

 

 

 

 

 

By:

/s/ Eric Wisnefsky

 

 

Title:

Treasurer

 

 

 

 

 

 

 

 

 

 

Address:

199 Benson Road

 

 

 

Middlebury, Connecticut 06749

 

Attention:

Treasurer

 

 

 

 

 

 

 

 

 

 

BIO-LAB, INC., as Seller

 

 

 

 

 

By:

/s/ Eric Wisnefsky

 

Title:

Treasurer

 

 

 

 

 

 

 

 

 

Address:

199 Benson Road

 

 

 

Middlebury, Connecticut 06749

 

Attention:

Treasurer

 

 

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

 

 

CROMPTON & KNOWLES RECEIVABLES
CORPORATION,
as the Buyer

 

 

 

 

 

 

By:

/s/ Eric Wisnefsky

 

 

Title:

President

 

 

 

 

 

 

 

 

 

 

Address:

199 Benson Road

 

 

 

Middlebury, Connecticut 06749

 

Attention:

 Treasurer

 

 

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

 

 

CONSENTED TO AND AGREED BY:

 

 

 

 

 

 

 

 

 

ABN AMRO BANK N.V.,
as Agent and as Purchaser Agent

 

 

 

 

 

By:

/s/ Kevin G. Pilz

 

Title:

Vice President

 

 

 

By:

/s/ Kristina Naville

 

 

Title:

Vice President

 

 

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

 

WACHOVIA BANK, NATIONAL ASSOCIATION,

 

as Purchaser Agent

 

 

 

 

By:

/s/ Michael J. Landry

 

Title:

Vice President

 

 

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

 

CALYON NEW YORK BRANCH,

 

 

 

as Purchaser Agent

 

 

 

By:

/s/ Michael Guarda

 

Title:

Director

 

 

 

By:

/s/ Sam Pilcer

 

Title:

Managing Director

 

 

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

 

EXHIBIT A

 

FORM OF BUYER NOTE

 

                    ,         

 

FOR VALUE RECEIVED, the undersigned, CROMPTON & KNOWLES RECEIVABLES CORPORATION,
a Delaware corporation (“Buyer”), promises to pay to [                       ],
a [         ] corporation (the “Seller” and together with its successors and
assigns, the “Holder”), on the terms and subject to the conditions set forth in
this promissory note (this “Note”) and in the Amended and Restated Receivables
Purchase Agreement dated as of September 28, 2006 (as amended, amended and
restated or otherwise modified from time to time, the “Agreement”) among Buyer,
CHEMTURA USA CORPORATION (the “Parent”), and certain affiliates of the Parent an
amount equal to the aggregate deferred Purchase Price owed by Buyer to the
Seller pursuant to Article III of the Agreement. Such amount, as shown in the
records of the Initial Collection Agent, will be rebuttable presumptive evidence
of the principal amount and interest owing under this Note.

 

1.             PURCHASE AGREEMENT.  THIS NOTE IS A BUYER NOTE DESCRIBED IN, AND
IS SUBJECT TO THE TERMS AND CONDITIONS SET FORTH IN, THE AGREEMENT. REFERENCE IS
HEREBY MADE TO THE AGREEMENT FOR A STATEMENT OF CERTAIN OTHER RIGHTS AND
OBLIGATIONS OF BUYER AND THE SELLER.

 

2.             RULES OF CONSTRUCTION; DEFINITIONS.  CERTAIN RULES OF
CONSTRUCTION GOVERNING THE INTERPRETATION OF THIS NOTE ARE SET FORTH IN APPENDIX
A TO THE AGREEMENT AND EXCEPT AS OTHERWISE SPECIFICALLY PROVIDED HEREIN,
CAPITALIZED TERMS USED BUT NOT DEFINED HEREIN HAVE THE MEANINGS ASCRIBED TO THEM
IN SUCH APPENDIX A OR, IF NOT DEFINED THEREIN, AS SUCH TERMS AS DEFINED IN THE
RECEIVABLES SALE AGREEMENT. IN ADDITION, AS USED HEREIN, THE FOLLOWING TERMS
HAVE THE FOLLOWING MEANINGS:

 

“Bankruptcy Proceedings” means any dissolution, winding up, liquidation,
readjustment, reorganization or other similar event relating to Buyer, whether
voluntary or involuntary, partial or complete, and whether in bankruptcy,
insolvency, receivership or other similar proceedings, or upon an assignment for
the benefit of creditors, or any other marshalling of the assets and liabilities
of Buyer or any sale of all or substantially all of the assets of Buyer;
provided, however, that none of the following shall constitute a “Bankruptcy
Proceeding” so long as no bankruptcy, insolvency, receivership or other similar
proceedings shall have been commenced by or against Buyer and is continuing; the
occurrence of a Termination Event in accordance with the terms of the
Receivables Sale Agreement.

 

“Highest Lawful Rate” has the meaning set forth in paragraph 9.

 

“Junior Liabilities” means all obligations of Buyer to the Holder under this
Note.

 

“Reference Rate” means, with respect to any day occurring in a Calculation
Period, the rate of interest then in effect under the Chemtura Credit Agreement.

 

1

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“Senior Interests” means all obligations of Buyer to the Agent or the Purchasers
under or in connection with the Transaction Documents, whether direct or
indirect, absolute or contingent, now or hereafter existing, or due or to become
due, including without limitation interest or other amounts due or to become due
after an Event of Bankruptcy.

 

“Subordination Provisions” means, collectively, the provisions of paragraph 7.

 

3.             INTEREST.  SUBJECT TO THE SUBORDINATION PROVISIONS, BUYER
PROMISES TO PAY INTEREST ON THE AGGREGATE UNPAID PRINCIPAL AMOUNT OF THIS NOTE
OUTSTANDING ON EACH DAY AT AN ADJUSTABLE RATE PER ANNUM EQUAL TO THE REFERENCE
RATE IN EFFECT ON SUCH DAY.

 

4.             INTEREST PAYMENT DATES.  (A)  SUBJECT TO THE SUBORDINATION
PROVISIONS, BUYER SHALL PAY ACCRUED INTEREST ON THIS NOTE ON THE TWENTIETH DAY
OF EACH MONTH. BUYER ALSO SHALL PAY ACCRUED INTEREST ON THE PRINCIPAL AMOUNT OF
EACH PREPAYMENT HEREOF ON THE DATE OF SUCH PREPAYMENT.

 

(B)           NOTWITHSTANDING THE PROVISIONS OF PARAGRAPH 4(A), IN THE EVENT
THAT ON THE DATE AN INTEREST PAYMENT IS DUE HEREUNDER THE AMOUNT OF FUNDS
AVAILABLE THEREFOR PURSUANT TO SECTION 3.3 OF THE AGREEMENT IS INSUFFICIENT TO
PAY ANY AMOUNT DUE PURSUANT TO PARAGRAPH 4(A), THEN INTEREST SHALL BE PAYABLE
ONLY TO THE EXTENT THAT FUNDS ARE AVAILABLE THEREFOR IN ACCORDANCE WITH
SECTION 3.3 OF THE AGREEMENT, AND ANY AMOUNT NOT PAID BECAUSE FUNDS ARE NOT
AVAILABLE IN ACCORDANCE WITH SAID SECTION 3.3 SHALL NOT CONSTITUTE A CLAIM (AS
DEFINED IN §101 OF THE BANKRUPTCY CODE) AGAINST OR CORPORATE OBLIGATION OF BUYER
FOR ANY SUCH INSUFFICIENCY. ALL INTEREST ON THIS NOTE THAT IS NOT PAID WHEN DUE
PURSUANT TO THIS PARAGRAPH SHALL BE PAYABLE ON THE NEXT DATE ON WHICH AN
INTEREST PAYMENT ON THIS NOTE IS DUE AND ON WHICH FUNDS ARE AVAILABLE THEREFOR
PURSUANT TO SECTION 3.3 OF THE AGREEMENT AND ALL SUCH UNPAID INTEREST SHALL
ACCRUE INTEREST AT THE REFERENCE RATE UNTIL PAID IN FULL.

 

5.             BASIS OF COMPUTATION.   INTEREST ACCRUED HEREUNDER SHALL BE
COMPUTED FOR THE ACTUAL NUMBER OF DAYS ELAPSED ON THE BASIS OF A 360-DAY YEAR.

 

6.             PRINCIPAL PAYMENT DATES.  SUBJECT TO THE SUBORDINATION
PROVISIONS, ANY UNPAID PRINCIPAL OF THIS NOTE SHALL ONLY BECOME DUE AND PAYABLE
ON THE DATE WHICH IS ONE YEAR AND ONE DAY AFTER THE DATE ON WHICH ALL
INVESTMENTS (AS DEFINED IN THE RECEIVABLES SALE AGREEMENT) AND OTHER AMOUNTS
THEN DUE AND OWING BY THE BUYER UNDER THE TRANSACTION DOCUMENTS HAVE BEEN PAID
IN FULL. SUBJECT TO THE SUBORDINATION PROVISIONS, THE PRINCIPAL AMOUNT OF AND
ACCRUED INTEREST ON THIS NOTE MAY BE PREPAID ON ANY BUSINESS DAY WITHOUT PREMIUM
OR PENALTY; PROVIDED, THAT NO PREPAYMENT SHALL BE MADE BY BUYER TO THE EXTENT
THAT SUCH PREPAYMENT WOULD RESULT IN A DEFAULT IN THE PAYMENT OF ANY OTHER
AMOUNT REQUIRED TO BE PAID BY BUYER UNDER ANY TRANSACTION DOCUMENT.

 

2

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7.             SUBORDINATION PROVISIONS.  BUYER COVENANTS AND AGREES, AND THE
HOLDER, BY ITS ACCEPTANCE OF THIS NOTE, LIKEWISE COVENANTS AND AGREES, THAT THE
PAYMENT OF ALL JUNIOR LIABILITIES IS HEREBY EXPRESSLY SUBORDINATED IN RIGHT OF
PAYMENT TO THE PAYMENT AND PERFORMANCE OF THE SENIOR INTERESTS TO THE EXTENT AND
IN THE MANNER SET FORTH IN THIS PARAGRAPH:

 

(A)           IN THE EVENT OF ANY BANKRUPTCY PROCEEDING, THE SENIOR INTERESTS
SHALL FIRST BE PAID AND PERFORMED IN FULL AND IN CASH BEFORE THE HOLDER SHALL BE
ENTITLED TO RECEIVE AND TO RETAIN ANY PAYMENT OR DISTRIBUTION IN RESPECT OF THE
JUNIOR LIABILITIES. IN ORDER TO IMPLEMENT THE FOREGOING: (I) ALL PAYMENTS AND
DISTRIBUTIONS OF ANY KIND OR CHARACTER IN RESPECT OF THE JUNIOR LIABILITIES TO
WHICH THE HOLDER WOULD BE ENTITLED EXCEPT FOR THIS CLAUSE (A) SHALL BE MADE
DIRECTLY TO THE AGENT (FOR THE BENEFIT OF ITSELF AND THE PURCHASERS), AND
(II) IF A BANKRUPTCY PROCEEDING HAS BEEN COMMENCED, THE HOLDER SHALL PROMPTLY
FILE A CLAIM OR CLAIMS, IN THE FORM REQUIRED IN SUCH BANKRUPTCY PROCEEDING, FOR
THE FULL OUTSTANDING AMOUNT OF THE JUNIOR LIABILITIES, AND SHALL USE
COMMERCIALLY REASONABLE EFFORTS TO CAUSE SAID CLAIM OR CLAIMS TO BE APPROVED AND
ALL PAYMENTS AND OTHER DISTRIBUTIONS IN RESPECT THEREOF TO BE MADE DIRECTLY TO
THE AGENT (FOR THE BENEFIT OF ITSELF AND THE PURCHASERS) UNTIL THE SENIOR
INTERESTS SHALL HAVE BEEN PAID AND PERFORMED IN FULL AND IN CASH.

 

(B)           IN THE EVENT THAT THE HOLDER RECEIVES ANY PAYMENT OR OTHER
DISTRIBUTION OF ANY KIND OR CHARACTER FROM BUYER OR FROM ANY OTHER SOURCE
WHATSOEVER, IN PAYMENT OF THE JUNIOR LIABILITIES, AFTER THE COMMENCEMENT OF ANY
BANKRUPTCY PROCEEDING, SUCH PAYMENT OR OTHER DISTRIBUTION SHALL BE RECEIVED IN
TRUST FOR THE AGENT AND THE PURCHASERS AND SHALL BE TURNED OVER BY THE HOLDER TO
THE AGENT FORTHWITH.

 

(C)           UPON THE FINAL INDEFEASIBLE PAYMENT IN FULL AND IN CASH OF ALL
SENIOR INTERESTS, THE HOLDER SHALL BE SUBROGATED TO THE RIGHTS OF THE AGENT AND
THE PURCHASERS TO RECEIVE PAYMENTS OR DISTRIBUTIONS FROM BUYER THAT ARE
APPLICABLE TO THE SENIOR INTERESTS UNTIL THE JUNIOR LIABILITIES ARE PAID IN
FULL.

 

(D)           THESE SUBORDINATION PROVISIONS ARE INTENDED SOLELY FOR THE PURPOSE
OF DEFINING THE RELATIVE RIGHTS OF THE HOLDER, ON THE ONE HAND, AND THE AGENT
AND THE PURCHASERS ON THE OTHER HAND. NOTHING CONTAINED IN THESE SUBORDINATION
PROVISIONS OR ELSEWHERE IN THIS NOTE IS INTENDED TO OR SHALL IMPAIR, AS BETWEEN
BUYER, ITS CREDITORS (OTHER THAN THE AGENT AND THE PURCHASERS) AND THE HOLDER,
BUYER’S OBLIGATION, WHICH IS UNCONDITIONAL AND ABSOLUTE, TO PAY THE JUNIOR
LIABILITIES AS AND WHEN THE SAME SHALL BECOME DUE AND PAYABLE IN ACCORDANCE WITH
THE TERMS HEREOF AND OF THE AGREEMENT OR TO EFFECT THE RELATIVE RIGHTS OF THE
HOLDER AND CREDITORS OF BUYER (OTHER THAN THE AGENT AND THE PURCHASERS).

 

(E)           THE HOLDER SHALL NOT, UNTIL THE SENIOR INTERESTS HAVE BEEN FINALLY
PAID AND PERFORMED IN FULL AND IN CASH, (I) CANCEL, WAIVE, FORGIVE, TRANSFER OR
ASSIGN, OR COMMENCE LEGAL PROCEEDINGS TO ENFORCE OR COLLECT, OR SUBORDINATE TO
ANY OBLIGATION OF BUYER (OTHER THAN TO THE SENIOR INTERESTS), HOWSOEVER CREATED,
ARISING OR EVIDENCED, WHETHER DIRECT OR INDIRECT, ABSOLUTE OR CONTINGENT, OR NOW
OR HEREAFTER EXISTING, OR DUE OR TO BECOME DUE, THE JUNIOR LIABILITIES OR ANY
RIGHTS IN RESPECT HEREOF OR (II) CONVERT THE JUNIOR LIABILITIES INTO

 

3

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AN EQUITY INTEREST IN BUYER, UNLESS, IN THE CASE OF EACH OF CLAUSES (I) AND
(II), THE HOLDER SHALL HAVE RECEIVED THE PRIOR WRITTEN CONSENT OF THE
INSTRUCTING GROUP IN EACH CASE.

 

(F)            THE HOLDER SHALL NOT COMMENCE, OR JOIN WITH ANY OTHER PERSON IN
COMMENCING, ANY PROCEEDING OF THE TYPE REFERRED TO IN THE DEFINITION OF
BANKRUPTCY EVENT WITH RESPECT TO BUYER UNTIL AT LEAST ONE YEAR AND ONE DAY SHALL
HAVE PASSED AFTER THE SENIOR INTERESTS SHALL HAVE BEEN FINALLY PAID AND
PERFORMED IN FULL AND IN CASH; PROVIDED, HOWEVER, THAT THE HOLDER SHALL AT ALL
TIMES HAVE THE RIGHT TO FILE ANY CLAIM IN OR OTHERWISE TAKE ANY ACTION WITH
RESPECT TO ANY INSOLVENCY PROCEEDING INSTITUTED AGAINST BUYER BY ANY PERSON
OTHER THAN THE HOLDER (PROVIDED THAT NO SUCH ACTION MAY BE TAKEN BY THE HOLDER
UNTIL SUCH PROCEEDING HAS CONTINUED UNDISMISSED, UNSTAYED AND IN EFFECT FOR A
PERIOD OF 10 DAYS).

 

(G)           IF, AT ANY TIME, ANY PAYMENT (IN WHOLE OR IN PART) MADE WITH
RESPECT TO ANY RECEIVABLE IS RESCINDED OR MUST BE RESTORED OR RETURNED BY THE
AGENT OR A PURCHASER (WHETHER IN CONNECTION WITH ANY BANKRUPTCY PROCEEDINGS OR
OTHERWISE), THESE SUBORDINATION PROVISIONS SHALL CONTINUE TO BE EFFECTIVE OR
SHALL BE REINSTATED, AS THE CASE MAY BE, AS THOUGH SUCH PAYMENT HAD NOT BEEN
MADE.

 

(H)           EACH OF THE AGENT AND THE PURCHASERS MAY, FROM TIME TO TIME, IN
ITS SOLE DISCRETION, WITHOUT NOTICE TO THE HOLDER, AND WITHOUT WAIVING ANY OF
ITS RIGHTS UNDER THESE SUBORDINATION PROVISIONS, TAKE ANY OR ALL OF THE
FOLLOWING ACTIONS: (I) RETAIN OR OBTAIN AN INTEREST IN ANY PROPERTY TO SECURE
ANY OF THE SENIOR INTERESTS, (II) RETAIN OR OBTAIN THE PRIMARY OR SECONDARY
OBLIGATIONS OF ANY OTHER OBLIGOR OR OBLIGORS WITH RESPECT TO ANY OF THE SENIOR
INTERESTS, (III) EXTEND OR RENEW FOR ONE OR MORE PERIODS (WHETHER OR NOT LONGER
THAN THE ORIGINAL PERIOD), ALTER, INCREASE OR EXCHANGE ANY OF THE SENIOR
INTERESTS, OR RELEASE OR COMPROMISE ANY OBLIGATION OF ANY NATURE WITH RESPECT TO
ANY OF THE SENIOR INTERESTS, (IV) AMEND, SUPPLEMENT, AMEND AND RESTATE, OR
OTHERWISE MODIFY ANY TRANSACTION DOCUMENT TO WHICH IT IS A PARTY, AND
(V) RELEASE ITS SECURITY INTEREST IN, OR SURRENDER, RELEASE OR PERMIT ANY
SUBSTITUTION OR EXCHANGE FOR ALL OR ANY PART OF ANY RIGHTS OR PROPERTY SECURING
ANY OF THE SENIOR INTERESTS, OR EXTEND OR RENEW FOR ONE OR MORE PERIODS (WHETHER
OR NOT LONGER THAN THE ORIGINAL PERIOD), OR RELEASE, COMPROMISE, ALTER OR
EXCHANGE ANY OBLIGATIONS OF ANY NATURE OF ANY OBLIGOR WITH RESPECT TO ANY SUCH
RIGHTS OR PROPERTY.

 

(I)            THE HOLDER HEREBY WAIVES: (I) NOTICE OF` ACCEPTANCE OF THESE
SUBORDINATION PROVISIONS BY THE AGENT OR ANY OF THE PURCHASERS, (II) NOTICE OF
THE EXISTENCE, CREATION, NON-PAYMENT OR NON-PERFORMANCE OF ALL OR ANY OF THE
SENIOR INTERESTS, AND (III) ALL DILIGENCE IN ENFORCEMENT, COLLECTION OR
PROTECTION OF, OR REALIZATION UPON, THE SENIOR INTERESTS, OR ANY THEREOF, OR ANY
SECURITY THEREFOR.

 

(J)            THESE SUBORDINATION PROVISIONS CONSTITUTE A CONTINUING, OFFER
FROM BUYER TO ALL PERSONS WHO BECOME THE HOLDERS OF, OR WHO CONTINUE TO HOLD,
SENIOR INTERESTS, AND THESE SUBORDINATION PROVISIONS ARE MADE FOR THE BENEFIT OF
THE AGENT AND THE PURCHASERS, AND THE AGENT MAY PROCEED TO ENFORCE SUCH
PROVISIONS ON BEHALF OF EACH OF SUCH PERSONS.

 

8.             GENERAL.  NO FAILURE OR DELAY ON THE PART OF THE HOLDER IN
EXERCISING ANY POWER OR RIGHT HEREUNDER SHALL OPERATE AS A WAIVER THEREOF NOR
SHALL ANY SINGLE OR PARTIAL EXERCISE OF ANY SUCH

 

4

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POWER OR RIGHT PRECLUDE ANY OTHER OR FURTHER EXERCISE THEREOF OR THE EXERCISE OF
ANY OTHER POWER OR RIGHT. NO AMENDMENT, MODIFICATION OR WAIVER OF, OR CONSENT
WITH RESPECT TO, ANY PROVISION OF THIS NOTE SHALL IN ANY EVENT BE EFFECTIVE
UNLESS (A) THE SAME SHALL BE IN WRITING AND SIGNED AND DELIVERED BY BUYER AND
THE SELLER, AND (B) ALL CONSENTS REQUIRED FOR SUCH ACTIONS UNDER THE TRANSACTION
DOCUMENTS SHALL HAVE BEEN RECEIVED BY THE APPROPRIATE PERSONS.

 

9.             LIMITATION ON INTEREST.  NOTWITHSTANDING ANYTHING IN THIS NOTE TO
THE CONTRARY, BUYER SHALL NEVER BE REQUIRED TO PAY UNEARNED INTEREST ON ANY
AMOUNT OUTSTANDING HEREUNDER, AND SHALL NEVER BE REQUIRED TO PAY INTEREST ON THE
PRINCIPAL AMOUNT OUTSTANDING HEREUNDER, AT A RATE IN EXCESS OF THE MAXIMUM
NONUSURIOUS INTEREST RATE THAT MAY BE CONTRACTED FOR, CHARGED OR RECEIVED UNDER
APPLICABLE FEDERAL OR STATE LAW (SUCH MAXIMUM RATE BEING HEREIN CALLED THE
“HIGHEST LAWFUL RATE”).  IF THE EFFECTIVE RATE OF INTEREST THAT WOULD OTHERWISE
BE PAYABLE UNDER THIS NOTE WOULD EXCEED THE HIGHEST LAWFUL RATE, OR THE HOLDER
SHALL RECEIVE ANY UNEARNED INTEREST OR SHALL RECEIVE MONIES THAT ARE DEEMED TO
CONSTITUTE INTEREST THAT WOULD INCREASE THE EFFECTIVE RATE OF INTEREST PAYABLE
BY BUYER UNDER THIS NOTE TO A RATE IN EXCESS OF THE HIGHEST LAWFUL RATE, THEN
(A) THE AMOUNT OF INTEREST THAT WOULD OTHERWISE BE PAYABLE BY BUYER UNDER THIS
NOTE SHALL BE REDUCED TO THE AMOUNT ALLOWED BY APPLICABLE LAW, AND (B) ANY
UNEARNED INTEREST PAID BY BUYER OR ANY INTEREST PAID BY BUYER IN EXCESS OF THE
HIGHEST LAWFUL RATE SHALL BE REFUNDED TO BUYER. WITHOUT LIMITATION OF THE
FOREGOING ALL CALCULATIONS OF THE RATE OF INTEREST CONTRACTED FOR, CHARGED OR
RECEIVED BY THE HOLDER UNDER THIS NOTE THAT ARE MADE FOR THE PURPOSE OF
DETERMINING WHETHER SUCH RATE EXCEEDS THE HIGHEST LAWFUL RATE SHALL BE MADE, TO
THE EXTENT PERMITTED BY APPLICABLE USURY LAWS (NOW OR HEREAFTER ENACTED), BY
AMORTIZING, PRORATING AND SPREADING IN EQUAL PARTS DURING THE ACTUAL PERIOD
DURING WHICH ANY AMOUNT HAS BEEN OUTSTANDING) HEREUNDER ALL INTEREST AT ANY TIME
CONTRACTED FOR, CHARGED OR RECEIVED BY THE HOLDER IN CONNECTION HEREWITH. IF AT
ANY TIME AND FROM TIME TO TIME (I) THE AMOUNT OF INTEREST PAYABLE TO THE HOLDER
ON ANY DATE SHALL BE COMPUTED AT THE HIGHEST LAWFUL RATE PURSUANT TO THE
PROVISIONS OF THE FOREGOING SENTENCE, AND (II) IN RESPECT OF ANY SUBSEQUENT
INTEREST COMPUTATION PERIOD THE AMOUNT OF INTEREST OTHERWISE PAYABLE TO THE
HOLDER WOULD BE LESS THAN THE AMOUNT OF INTEREST PAYABLE TO THE HOLDER COMPUTED
AT THE HIGHEST LAWFUL RATE, THEN THE AMOUNT OF INTEREST PAYABLE TO THE HOLDER IN
RESPECT OF SUCH SUBSEQUENT INTEREST COMPUTATION PERIOD SHALL CONTINUE TO BE
COMPUTED AT THE HIGHEST LAWFUL RATE UNTIL THE TOTAL AMOUNT OF INTEREST PAYABLE
TO THE HOLDER SHALL EQUAL THE TOTAL AMOUNT OF INTEREST THAT WOULD HAVE BEEN
PAYABLE TO THE HOLDER IF THE TOTAL AMOUNT OF INTEREST HAD BEEN COMPUTED WITHOUT
GIVING EFFECT TO THE PROVISIONS OF THE FOREGOING SENTENCE.

 

10.           NO NEGOTIATION.  THIS NOTE IS NOT NEGOTIABLE.

 

11.           GOVERNING LAW.  THIS NOTE SHALL BE DEEMED TO BE A CONTRACT MADE
UNDER AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW
YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES.

 

12.           SECURITY INTEREST.  THE SELLER MAY GRANT A SECURITY INTEREST IN OR
OTHERWISE PLEDGE THIS NOTE AS SECURITY, AND ANY PERSON TO WHOM SUCH SECURITY
INTEREST IS GRANTED OR TO WHOM THIS NOTE IS PLEDGED SHALL BE BOUND BY, AND FOR
ALL PURPOSES TAKES THIS NOTE SUBJECT TO, THE RESTRICTIONS AND OTHER PROVISIONS
(INCLUDING THE SUBORDINATION PROVISIONS) SET FORTH HEREIN.

 

5

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13.           CAPTIONS.  PARAGRAPH CAPTIONS USED IN THIS NOTE ARE PROVIDED
SOLELY FOR CONVENIENCE OF REFERENCE AND SHALL NOT AFFECT THE MEANING OR
INTERPRETATION OF ANY PROVISION OF THIS NOTE.

 

 

CROMPTON & KNOWLES RECEIVABLES
CORPORATION

 

 

 

By:

 

 

 

Title:

 

 

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EXHIBIT B

 

FORM OF
SELLER ASSIGNMENT CERTIFICATE

[DATE]

 

Reference is made to the Amended and Restated Receivables Purchase Agreement
dated as of September 28, 2006 (as the same may be amended, supplemented,
amended and restated or otherwise modified from time to time, the “Agreement”)
among CHEMTURA CORPORATION (“Chemtura”, as Initial Collection Agent, certain
affiliates of Chemtura, as Sellers, and CROMPTON & KNOWLES RECEIVABLES
CORPORATION (“Buyer”).  Unless otherwise defined herein, capitalized terms used
herein have the meanings provided in Appendix A to the Agreement, and this
Seller Assignment Certificate shall be interpreted in accordance with the
conventions set forth in Part B of such Appendix A.

 

The undersigned (the “Seller”) hereby sells, transfers, assigns, sets over and
conveys unto Buyer all right, title and interest of the Seller in, to and under:

 

(A)           ALL RECEIVABLES OF THE SELLER (OTHER THAN CONTRIBUTED RECEIVABLES)
THAT EXISTED AND WERE OWING TO THE SELLER AS AT THE CLOSING OF THE SELLER’S
BUSINESS ON THE INITIAL CUT-OFF DATE,

 

(B)           ALL RECEIVABLES CREATED BY THE SELLER (OTHER THAN CONTRIBUTED
RECEIVABLES) THAT ARISE DURING THE PERIOD FROM AND INCLUDING THE CLOSING OF THE
SELLERS BUSINESS ON THE INITIAL CUT-OFF DATE TO BUT EXCLUDING THE PURCHASE
TERMINATION DATE,

 

(C)           ALL RELATED SECURITY WITH RESPECT TO ALL RECEIVABLES (OTHER THAN
CONTRIBUTED RECEIVABLES) OF THE SELLER,

 

(D)           ALL COLLECTIONS AND OTHER PROCEEDS OF THE FOREGOING, INCLUDING ALL
FUNDS RECEIVED BY ANY PERSON IN PAYMENT OF ANY AMOUNTS OWED (INCLUDING INVOICE
PRICES, FINANCE CHARGES, INTEREST AND ALL OTHER CHARGES, IF ANY) IN RESPECT OF
ANY RECEIVABLE DESCRIBED ABOVE (OTHER THAN A CONTRIBUTED RECEIVABLE) OR RELATED
SECURITY WITH RESPECT TO ANY SUCH RECEIVABLE, OR OTHERWISE APPLIED TO REPAY OR
DISCHARGE ANY SUCH RECEIVABLE (INCLUDING INSURANCE PAYMENTS THAT THE SELLER OR
THE INITIAL COLLECTION AGENT APPLIES IN THE ORDINARY COURSE OF ITS BUSINESS TO
AMOUNTS OWED IN RESPECT OF ANY SUCH RECEIVABLE AND NET PROCEEDS OF ANY SALE OR
OTHER DISPOSITION OF REPOSSESSED GOODS THAT WERE THE SUBJECT OF ANY SUCH
RECEIVABLE) OR OTHER COLLATERAL OR PROPERTY OF ANY OBLIGOR OR ANY OTHER PERSON
DIRECTLY OR INDIRECTLY LIABLE FOR PAYMENT OF SUCH RECEIVABLES), AND

 

(E)           ALL RECORDS RELATING TO ANY OF THE FOREGOING.

 

This Seller Assignment Certificate is made without recourse but on the terms and
subject to the conditions set forth in the Transaction Documents to which the
Seller is a party. The Seller acknowledges and agrees that Buyer is accepting
this Seller Assignment Certificate in reliance on the representations,
warranties and covenants of the Seller contained in the Transaction Documents to
which the Seller is a party.

 

1

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THIS SELLER ASSIGNMENT CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH THE
AGREEMENT AND THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO
CONFLICT OF LAWS PRINCIPLES.

 

IN WITNESS WHEREOF, the undersigned has caused this Seller Assignment
Certificate to be duly executed and delivered by its duly Authorized Officer as
of the date first above written.

 

 

[SELLER FULL NAME]

 

 

 

By:

 

 

 

Title:

 

 

2

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EXHIBIT C

 

FORM OF LETTER OF CREDIT REQUEST

 

[Date]

 

To:     Crompton & Knowles Receivables Corporation
199 Benson Road

Middlebury, Connecticut 06749

Attention:             
Facsimile:              
Telephone:

 

Re:  LETTER OF CREDIT REQUEST

 

Ladies and Gentlemen:

 

Reference is hereby made to the Amended and Restated Receivables Sale Agreement,
dated as of September 28, 2006, among Chemtura Corporation, as Initial
Collection Agent, the sellers listed therein, and Crompton & Knowles Receivables
Corporation as buyer (as amended, supplemented, restated or otherwise modified
from time to time in accordance with its terms, the “Agreement”).  Capitalized
terms used and not otherwise defined herein are used with the meanings
attributed to them in the Agreement.

 

You are hereby requested to arrange for and obtain the issuance of a standby
letter of credit with the following terms for your account:

 

1.             Name and address of beneficiary:

 

2.             To be delivered by [overnight carrier/teletransmission/mail/other
(specify)]

 

3.             Currency and amount:  US$

 

4.             Advising bank name and address, if applicable:

 

5.                                       Expiration date (not to exceed one year
from the date of issuance or extension):

 

6.             Credit to be available for payment against beneficiary’s
draft(s) drawn at sight accompanied by the following documents (check one):

 

          Statement purportedly signed by the beneficiary which reads as
follows:                              .

          Other Documents:

          Special Conditions (including, if you have a preference, selection of
UCP or ISP98):

          Issue substantially in form of attached specimen.

 

[We hereby offer you a commission for this letter of credit, payable upon its
issuance and delivery, of $                       .]

 

1

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[If the beneficiary specified above is a financial institution that is to issue
its own undertaking based on this requested letter of credit:  Request
beneficiary to issue and deliver its (specify type of undertaking)
                   in favor of                               for an amount not
exceeding the amount specified above, effective immediately relative to (specify
contract number or other pertinent reference)                           to
expire on                            .    ]

 

The requested letter of credit should state that it is being issued upon
application of Crompton & Knowles Receivables Corporation at the request of
Chemtura USA Corporation.

 

Sincerely,

Chemtura USA Corporation, as Parent

 

By:

 

 

Name:

 

Title:

 

 

2

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SCHEDULE 1

 

LITIGATION AND OTHER PROCEEDINGS

 

NONE

 

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SCHEDULE 2

 

CREDIT AND COLLECTION POLICY

 

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SCHEDULE 3

SELLER LOCATIONS – OFFICES AND RECORDS

 

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SCHEDULE 4

 

LEGAL NAMES, TRADE NAMES AND NAMES
UNDER WHICH THE SELLERS DO BUSINESS

 

Chemtura Corporation

Chemtura USA Corporation

Great Lakes Chemical Corporation

Bio-Lab, Inc.

Crompton Sales Company, Inc.

Crompton Corporation

Crompton & Knowles Corporation

Uniroyal Chemical Company, Inc.

CK Witco Corp.

Crompton Manufacturing Company, Inc.

Witco Corporation

 

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

 

APPENDIX A

to

Receivables Purchase Agreement

 

DEFINITIONS

 

Part A.  Defined Terms

 

“Agent” means ABN AMRO Bank N.V., in its capacity as agent under the Receivables
Sale Agreement, and successor thereto appointed in accordance with the
Receivables Sale Agreement.

 

“Adverse Claim” means any claim of ownership interest or any mortgage, deed of
trust, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien
(statutory or other) or other security interest.

 

“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. 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, membership interests, by contract,
or otherwise.

 

“Aggregate Unpaid Balance” is defined in Section 2.1(b) of the Receivables
Purchase Agreement.

 

“Attorney Costs” means and includes all fees and disbursements of any law firm
or other external counsel.

 

“Authorized Officer” means, with respect to Buyer, Initial Collection Agent, any
Seller or the Agent, any of the Chief Executive Officer, the President, the
Treasurer, the Chief Financial Officer, any Vice President and any Assistant
Treasurer of such Person.

 

“Bankruptcy Code” means the Federal Bankruptcy Reform Act of 1978 (11 U.S.C.
§101. et seq.).

 

“Bankruptcy Event” means, for any Person, any of the following events:

 

(A)           A CASE OR OTHER PROCEEDING SHALL BE COMMENCED, WITHOUT THE
APPLICATION OR CONSENT OF SUCH PERSON, IN ANY COURT, SEEKING THE LIQUIDATION,
REORGANIZATION, DEBT ARRANGEMENT, DISSOLUTION, WINDING UP OR COMPOSITION OR
READJUSTMENT OF DEBTS OF SUCH PERSON, THE APPOINTMENT OF A TRUSTEE, RECEIVER,
CUSTODIAN, LIQUIDATOR, ASSIGNEE, SEQUESTRATOR OR THE LIKE FOR SUCH PERSON OR ANY
SUBSTANTIAL PART OF ITS ASSETS, OR ANY SIMILAR ACTION WITH RESPECT TO SUCH
PERSON UNDER ANY LAW RELATING TO BANKRUPTCY, INSOLVENCY, REORGANIZATION, WINDING
UP OR COMPOSITION OR ADJUSTMENT OF DEBTS, AND SUCH CASE OR PROCEEDING SHALL
CONTINUE UNDISMISSED, OR UNSTAYED AND IN EFFECT, FOR A PERIOD OF 60 DAYS; OR AN
ORDER FOR RELIEF IN RESPECT OF SUCH PERSON SHALL BE ENTERED IN AN INVOLUNTARY
CASE UNDER THE FEDERAL BANKRUPTCY LAWS OR OTHER SIMILAR LAWS NOW OR HEREAFTER IN
EFFECT, OR

 

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(B)           SUCH PERSON SHALL COMMENCE A VOLUNTARY CASE OR OTHER PROCEEDING
UNDER ANY APPLICABLE BANKRUPTCY, INSOLVENCY, REORGANIZATION, DEBT ARRANGEMENT,
DISSOLUTION OR OTHER SIMILAR LAW NOW OR HEREAFTER IN EFFECT, OR SHALL CONSENT TO
THE APPOINTMENT OF OR TAKING POSSESSION BY A RECEIVER, LIQUIDATOR, ASSIGNEE,
TRUSTEE, CUSTODIAN, SEQUESTRATION OR THE LIKE, FOR SUCH PERSON OR ANY
SUBSTANTIAL PART OF ITS PROPERTY, OR SHALL MAKE ANY GENERAL ASSIGNMENT FOR THE
BENEFIT OF CREDITORS, OR SHALL FAIL TO, OR ADMIT IN WRITING ITS INABILITY TO,
PAY ITS DEBTS GENERALLY AS THEY BECOME DUE.

 

“Business Day” shall have the meaning assigned to such term on the Receivables
Sale Agreement.

 

“Buyer” is defined in the preamble to the Receivables Purchase Agreement.

 

“Calculation Period” means a calendar month.

 

“Calendar Cycle” means a financial reporting cycle utilized by the Initial
Collection Agent.

 

“Collection” means all funds that are received by a Seller or Initial Collection
Agent from or on behalf of any Obligor in payment of any amounts owed (including
invoice prices, finance charges, interest and all other charges, if any) in
respect of any Receivable or Related Asset, or any other funds otherwise applied
to repay or discharge any Receivable (including insurance payments applied in
the ordinary course of its business to amounts owed in respect of such
Receivable and net proceeds of sale or other disposition of repossessed (goods
that were the subject of such Receivable), in each case without regard to
whether such funds are immediately available or evidenced by checks or
otherwise.

 

“Contributed Receivables” is defined in Section 1.7 of the Receivables Purchase
Agreement.

 

“Credit and Collection Policy” means, with respect to a Seller, the credit and
collection policies and practices relating to the contracts and Receivables of
such Seller as set forth in Schedule 2 to the Receivables Purchase Agreement, as
such credit and collection policies may be modified without violating
Section 6.1(g) of the Receivables Purchase Agreement.

 

“Chemtura Credit Agreement” is defined in the Receivables Sale Agreement.

 

“Cut-Off Date” means the last day of any calendar month.

 

“Daily Report” means the report prepared by the Initial Collection Agent in
accordance with the proviso set forth in Section 3.3 of the Receivable Sale
Agreement and the form of which appears as Exhibit D-2 to the Receivables Sale
Agreement.

 

“Dollars” means dollars in lawful money of the United States of America.

 

“Effective Date” means September 28, 2006.

 

A-2

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“Eligible Receivable” shall have the meaning assigned to such term in the
Receivables Sale Agreement.

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended,
and any successor statute of similar import, together with the regulations
thereunder, in each case as in effect from time to time.

 

“ERISA Affiliate” means a corporation, trade or business that is, along with any
Seller, a member of a controlled group of corporations or a controlled group of
trades or businesses, as described in section 414 of the Internal Revenue Code,
or section 4001 of ERISA

 

“Federal Reserve Board” means the Board of Governors of the Federal Reserve
System, or any successor thereto or to the functions thereof.

 

“First Issuance Date” means, with respect to each Seller, the date such Seller
became party to this Receivables Purchase Agreement.

 

“GAAP” means United States generally accepted accounting principles.

 

“Governmental Authority” means the United States of America, any state or other
political subdivision thereof and any entity in the United States of America or
any applicable foreign jurisdiction that exercises executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government.

 

“Guaranty” means any agreement or arrangement by which any Person directly or
indirectly guarantees, endorses, agrees to purchase or otherwise becomes
contingently liable upon any liability of any other Person (other than by
endorsements of instruments in the course of collection) or guarantees the
payment of distributions upon the shares of any other Person.

 

“Indebtedness” of any Person means all of that Person’s obligations for borrowed
money, obligations evidenced by bonds, debentures, notes or other similar
instruments, obligations as lessee under leases that are required by GAAP to be
recorded as capitalized leases and obligations to pay the deferred purchase
price of property or services.

 

“Indemnified Losses” means any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, claims, suits, costs, charges, expenses
and disbursements (including reasonable Attorney Costs) of any kind or nature
whatsoever (whether on account of settlement or otherwise, and whether or not
the Person seeking indemnification, payment or reimbursement is a party to any
action or proceeding, if applicable, that gives rise to any Indemnified Losses).

 

“Initial Collection Agent” means at any time the Person then authorized pursuant
to the Receivables Sale Agreement to service, administer and collect Receivables
and the Related Assets, which Person shall initially be Chemtura Corporation.

 

“Initial Cut-Off Date” means, with respect to each Seller, the Business Day
immediately preceding the First Issuance Date.

 

A-3

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“Instructing Group” is defined in the Receivables Purchase Agreement.

 

“Internal Revenue Code” means the Internal Revenue Code of 1986.

 

“LC Application” shall have the meaning set forth in the Receivables Purchase
Agreement.

 

“LC Commission” means, with respect to any Letter of Credit, an amount equal to
the fee payable in connection with the issuance or extension of such Letter of
Credit.

 

“LC Issuer” means Wachovia Bank, National Association, in its capacity as the
issuer of a Letter of Credit pursuant to the terms of the Receivables Sale
Agreement.

 

“LC Obligations” shall have the meaning set forth in the Receivable Purchase
Agreement.

 

“Letter of Credit” means a stand-by letter of credit issued by the LC Issuer in
United States dollars upon application of Buyer at the request of the Parent, as
extended from time to time in accordance with this Agreement.

 

“Letter of Credit Request” means a request substantially in the form of
Exhibit C hereto, with appropriate insertions thereto, duly executed by a
Seller.

 

“Lockbox Accounts” means bank accounts into which Collections from Receivables
are deposited.

 

“Lockbox Bank” means any of the banks at which one or more Lockbox Accounts are
maintained.

 

“Material Adverse Effect” means, with respect to any Seller or Initial
Collection Agent and any, event or circumstance at any time, a material adverse
effect on (a) the ability of Seller or Initial Collection Agent to perform its
obligations under any Transaction Document or (b) the validity, enforceability
or collectibility of any Receivables, Related Assets or contracts relating
thereto or (c) any Transaction Document, provided, that for the purpose of
determining whether any Adverse Claim or other event or circumstance results (or
has a likelihood of resulting) in a Material Adverse Effect, the effect of such
event or circumstance shall be considered in the aggregate with the effect of
all other Adverse Claims (including Permitted Adverse Claims) or other events
and circumstances occurring or existing at the time of such determination.

 

“Moody’s” means Moody’s Investors Service, Inc. or any successor thereto.

 

“Net Worth” means, as of any date of determination, an amount equal to the
excess, if any, of (x) the sum of (a) the sum of the then Unpaid Balances of all
Receivables owned by the Buyer and (B) all amounts then on deposit in the Letter
of Credit Collateral Account, over (y) the sum of (i) the Aggregate Investment,
measured as of such date of determination, plus (ii) the sum of the unpaid
principal balance of all Buyer Notes then outstanding (including the amount of
any increase in such principal balances to be made on such date of
determination).

 

A-4

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“Noteholder” means any holder of a commercial paper note issued by the
Purchaser.

 

“Notice of Difference” is defined in the Receivables Sale Agreement.

 

“Obligations” means (a) all obligations (monetary or otherwise) of the Seller to
the Buyer and its successors, permitted transferees and assigns, arising under
or in connection with the Transaction Documents, and (b) all obligations
(monetary or otherwise) of a Seller to Buyer and its successors, transferees and
assigns, arising under or in connection with the Transaction Documents, in each
case howsoever created, arising or evidenced, whether direct or indirect,
absolute or contingent now or hereafter existing, or due or to become due.

 

“Obligor” means a Person obligated to make payments on a Receivable.

 

“Officer’s Certificate” means, unless otherwise specified in the Receivables
Purchase Agreement or Receivables Sale Agreement, as the case may be, a
certificate signed by an Authorized Officer of the applicable Seller or the
Initial Collection Agent as the case may be, or, in the case of a Successor
Initial Collection Agent, a certificate signed by the President, any Vice
President, Assistant Treasurer or the financial controller (or an officer
holding an office with equivalent or more senior responsibilities) of such
Successor Initial Collection Agent, that, in the case of any of the foregoing,
is delivered to the Agent.

 

“Opinion of Counsel” means a written opinion of counsel, which shall be
reasonably acceptable to the addressees thereof.

 

“Original Agreement” means the Receivables Purchase Agreement, dated as of
December 11, 1998, among Chemtura Corporation, as Initial Collection Agent,
Crompton and Knowles Receivables Corporation, as the Buyer, and the Sellers from
time to time party thereto, as amended, supplemented or otherwise modified prior
to the date hereof.

 

“Parent” means Chemtura USA Corporation.

 

“PBGC” means the Pension Benefit Guaranty Corporation.

 

“Pension Plan” means a “pension plan,” as such term is defined in section
3(2) of ERISA, which is subject to title IV of ERISA (other than any
“multiemployer plan” as such term is defined in section 4001(a)(3) of ERISA),
and to which any Seller or any ERISA Affiliate may have any liability, including
any liability by reason of having been a substantial employer within the meaning
of section 4063 of ERISA at any time during the preceding five years or by
reason of being deemed to be a contributing sponsor under section 4069 of ERISA.

 

“Periodic Report” is defined in the Receivables Sale Agreement.

 

“Permitted Adverse Claims” means (a) ownership or security interests arising
under the Transaction Documents; and (b) liens for taxes, assessments or charges
of any Governmental Authority (other than Tax or ERISA Liens) and liens of
landlords, carriers, warehousemen, mechanics and materialmen imposed by law in
the ordinary course of business, in each case (i) for amounts not yet due or
(ii) which are being contested in good faith by appropriate

 

A-5

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proceedings and with respect to which adequate reserves or other appropriate
provisions are being maintained in accordance with GAAP.

 

“Person” means an individual, partnership, limited liability company,
corporation, joint stock company, trust (including a business trust),
unincorporated association, joint venture, government or any agency or political
subdivision thereof or any other entity.

 

“Process Agent” is defined in Section 10.7 of the Receivables Purchase
Agreement.

 

“Program” means the transactions contemplated in the Transaction Documents.

 

“Purchase” means each purchase of Receivables and Related Assets by Buyer from a
Seller under the Receivables Purchase Agreement.

 

“Purchaser Agent” is defined in the Receivables Sale Agreement.

 

“Purchasers” is defined in the Receivables Sale Agreement.

 

“Purchase Price” is defined in Section 2.1(b) of the Receivables Purchase
Agreement.

 

“Purchase Price Credit” is defined in Section 3.1(d) of the Receivables Purchase
Agreement.

 

“Purchase Termination Date” means the earlier to occur of (a) the effective date
of termination specified by the Seller pursuant to Section 8.1 of the
Receivables Purchase Agreement, and (b) the occurrence of any event referred to
in Section 8.2 of the Receivables Purchase Agreement.

 

“Purchased Assets” is defined in Section 1.1 of the Receivables Purchase
Agreement.

 

“Purchased Receivables” is defined in Section 1.1 of the Receivables Purchase
Agreement.

 

“Purchaser Collections” shall have the meaning assigned to each term in the
Receivables Sale Agreement.

 

“Rating Agency” means each of S&P and Moody’s.

 

“Receivable” shall have the meaning assigned to such term in the Receivables
Sale Agreement.

 

“Receivables Purchase Agreement” means the Amended and Restated Receivables
Purchase Agreement, dated as of September 28, 2006, among Chemtura Corporation,
as Initial Collection Agent, the Seller and the Buyer, as such agreement may be
amended, amended and restated, modified or supplemented from time to time in
accordance with its terms.

 

“Receivables Sale Agreement” means the Fourth Amended and Restated Receivables
Sale Agreement, dated as of September 28, 2006, among Crompton & Knowles
Receivables Corporation, as seller, Chemtura Corporation, as the Initial
Collection Agent, ABN AMRO Bank

 

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N.V., as the Agent and the Amsterdam Purchaser Agent, Wachovia Bank, National
Association, as the VFCC Purchaser Agent and LC Issuer, Calyon New York Branch,
as the Atlantic Purchaser Agent, the other Purchaser Agents from time to time
party thereto, the Related Bank Purchasers from time to time party thereto and
Amsterdam Funding Corporation, Atlantic Asset Securitization LLC and Variable
Funding Capital Company, LLC and the other Conduit Purchasers from time to time
party thereto, as such agreement may be amended, amended and restated, modified
or supplemented from time to time in accordance with its terms.

 

“Records” means all contracts, purchase orders, invoices and other agreements,
documents, books, records and other media for the storage of information
(including tapes, disks, punch cards, computer programs and databases and
related property) maintained by the Sellers or Initial Collection Agent with
respect to the Purchased Assets or the related Obligors.

 

“Recoveries” means all Collections received by the Initial Collection Agent in
respect of any Write-Off.

 

“Related Assets” is defined in Section 1.1 of the Receivables Purchase
Agreement.

 

“Related Contributed Assets” is defined in Section l.7 the Receivables Purchase
Agreement.

 

“Related Purchased Assets” is defined in Section 1.1 of the Receivables Purchase
Agreement.

 

“Related Security” means, with respect to any Receivable, (a) all of the
applicable Seller’s right, title and interest in and to the goods. if any,
relating to the sale that gave rise to the Receivable, (b) all other security
interests or liens and property subject thereto from time to time purporting to
secure payment of the Receivable, whether pursuant to any contract related to
the Receivable or otherwise, and (c) all letters of credit, guarantees and other
agreements or arrangements of whatever character from time to time supporting or
securing payment of the Receivable, whether pursuant to any contract related to
the Receivable or otherwise.

 

“Report Date” means the twentieth day of each calendar month (or, if such day is
not a Business Day, the next Business Day following such day).

 

“Required Capital Amount” means, as of any date of determination, an amount
equal to the greater of (i) the LC Obligations then unpaid and (ii) Twenty Eight
Million, Five Hundred Thousand Dollars ($28,500,000).

 

“S&P” means Standard & Poor’s, a division of The McGraw-Hill Companies. Inc., or
any successor thereto.

 

“Securities Act” means the Securities Act of 1933, as amended.

 

“Seller” means each Person from time to time party to the Receivables Purchase
Agreement as a “Seller.”

 

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“Seller Assignment Certificate” means an assignment by a Seller, substantially
in the form of Exhibit B to the Receivables Purchase Agreement.

 

“Seller Collections” shall have the meaning assigned to such term in the
Receivables Sale Agreement.

 

“Seller Noncomplying Receivables Adjustments” is defined in Section 3.5(a) of
the Receivables Purchase Agreement.

 

“Solvent” means with respect to any Person that as of the date of determination
both (A)(i) the then fair saleable value of the property of such Person is
(y) greater than the total amount of liabilities (including contingent
liabilities) of such Person and (z) not less than the amount that will be
required to pay the probable liabilities on such Person’s then existing debts as
they become absolute and matured considering all financing alternatives and
potential asset sales reasonably available to such Person; (ii) such Person’s
capital is not unreasonably small in relation to its business or any
contemplated or undertaken transaction; and (iii) such Person does not intend to
incur, or believe (nor should it reasonably believe) that it will incur, debts
beyond its ability to pay such debts as they become due; and (B) such Person is
“solvent” within the meaning given that term and similar terms under applicable
laws relating to fraudulent transfers and conveyances.  For purposes of this
definition, the amount of any contingent liability at any time shall be computed
as the amount that, in light of all of the facts and circumstances existing at
such time, represents the amount that can reasonably be expected to become an
actual or matured liability.

 

“Specified Assets” is defined in Section 1.1 of the Receivables Purchase
Agreement.

 

“Subsidiary” means, with respect to and Person, any corporation of which more
than 50% of the outstanding capital stock having ordinary voting power to elect
a majority of the board of directors of such corporation (irrespective of
whether at the time capital stock of any other class or classes of such
corporation shall or might have voting power upon the occurrence of any
contingency) is at the time directly or indirectly owned by such Person.

 

“Tax or ERISA Lien” means a lien arising under Section 6321 of the Internal
Revenue Code or Section 302(f) or 4068 of ERISA.

 

“Terminating Seller” means any Seller that shall have given written notice to
the Buyer of its intention to terminate its obligation to sell to the Buyer its
Receivables and Related Assets.

 

“Transaction Documents” shall have the meaning assigned to such term in the
Receivables Sale Agreement.

 

“UCC” means the Uniform Commercial Code as from time to time in effect in the
applicable jurisdiction or jurisdictions.

 

“Unpaid Balance” of any Receivable means at any time the unpaid amount thereof
as shown in the books of Initial Collection Agent at such time.

 

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“Write-Off” means any Receivable that, consistent with the applicable Credit and
Collection Policy, has been written off as uncollectible.

 

Part B. Other Interpretative Matters.  For purposes of any Transaction Document
(including in this Appendix), unless otherwise specified therein: (1) accounting
terms used and not specifically defined therein shall be construed in accordance
with GAAP; (2) terms used in Article 9 of the New York UCC, and not specifically
defined in that Transaction Document, are used therein as defined in such
Article 9; (3) the term “including” means “including without limitation,” and
other forms of the verb “to include” have correlative meanings; (4) references
to any Person include such Person’s permitted successors; (5) in the computation
of a period of time from a specified date to a later specified date, the word
“from” means “from and including” and the words “to” and “until” each means “to
but excluding”; (6) the words “hereof”, “herein” and “hereunder” and words of
similar import refer to such Transaction Document as a whole and not to any
particular provision of such Transaction Document; (7) the term “or” means
“and/or”; (8) the meanings of defined terms are equally applicable to the
singular and plural forms of such defined terms; (9) references to “Section”,
“Schedule”, “Exhibit”, “Annex” and “Appendix” in such Transaction Document are
references to Sections, Schedules, Exhibits, Annexes and Appendices in or to
such Transaction Document; (10) the various captions (including any table of
contents) are provided solely for convenience of reference and shall not affect
the meaning or interpretation of such Transaction Document; and (11) references
to any statute or regulation refer to that statute or regulation as amended from
time to time, and include any successor statute or regulation of similar import.

 

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