Exhibit 10.1

 

CONFIDENTIAL

 

EXECUTION VERSION

 

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STOCK PURCHASE AGREEMENT

 

dated as of September 17, 2013

 

by and between

 

Rockwood Specialties Group, Inc.

 

and

 

Huntsman International LLC

 

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TABLE OF CONTENTS

 

 

 

Page

 

 

 

ARTICLE I                                          PURCHASE AND SALE OF SHARES

1

 

 

 

1.1

Purchase and Sale

1

 

 

 

1.2

Purchase Price and Payment

1

 

 

 

1.3

Closing

1

 

 

 

1.4

Deliveries at the Closing

2

 

 

 

1.5

Purchase Price Adjustment

7

 

 

 

1.6

Augusta Cost Overrun Reimbursement

9

 

 

 

ARTICLE II                                     REPRESENTATIONS AND WARRANTIES OF
PARENT

11

 

 

 

2.1

Organization and Good Standing

11

 

 

 

2.2

Capitalization

11

 

 

 

2.3

Authority, Approvals and Consents

12

 

 

 

2.4

Financial Statements

14

 

 

 

2.5

Absence of Undisclosed Liabilities; Indebtedness

15

 

 

 

2.6

Absence of Certain Changes or Events

15

 

 

 

2.7

Taxes

15

 

 

 

2.8

Legal Matters

17

 

 

 

2.9

Property

18

 

 

 

2.10

Material Contracts

19

 

 

 

2.11

Labor Relations

22

 

 

 

2.12

Employee Benefits

24

 

 

 

2.13

Transactions with Affiliates; Enterprise Agreements

27

 

 

 

2.14

Environmental Matters

28

 

 

 

2.15

Intellectual Property

29

 

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TABLE OF CONTENTS
(Continued)

 

 

 

Page

 

 

 

2.16

Permits; Subsidies

30

 

 

 

2.17

Compliance with Foreign Corrupt Practices Act

30

 

 

 

2.18

Compliance with Trade Laws

31

 

 

 

2.19

Brokers

31

 

 

 

2.20

Insurance

31

 

 

 

2.21

Customers and Suppliers

32

 

 

 

2.22

Product Liabilities and Warranties

32

 

 

 

2.23

Credit Support

32

 

 

 

2.24

Viance

33

 

 

 

2.25

No Other Business

33

 

 

 

ARTICLE III                                REPRESENTATIONS AND WARRANTIES OF
BUYER

33

 

 

 

3.1

Incorporation of Buyer

33

 

 

 

3.2

Power; Authorization; Consents

33

 

 

 

3.3

Litigation

34

 

 

 

3.4

Brokers

34

 

 

 

3.5

Investment Intent of Buyer

34

 

 

 

3.6

Financing

35

 

 

 

ARTICLE IV                                 COVENANTS

35

 

 

 

4.1

Access; Confidentiality

35

 

 

 

4.2

Announcements; Public Disclosures

36

 

 

 

4.3

Conduct of Business Prior to the Closing

36

 

 

 

4.4

Consents; Cooperation

41

 

 

 

4.5

Competition Filings

42

 

 

 

4.6

Use of Name

44

 

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TABLE OF CONTENTS
(Continued)

 

 

 

Page

 

 

 

4.7

Notification of Certain Matters

45

 

 

 

4.8

Retention of Books and Records

45

 

 

 

4.9

Permits

46

 

 

 

4.10

Intercompany Agreements

46

 

 

 

4.11

Indebtedness

46

 

 

 

4.12

Credit Support

47

 

 

 

4.13

Title Insurance

48

 

 

 

4.14

Restructurings; Augusta Related Activities

48

 

 

 

4.15

Restrictive Covenants

48

 

 

 

4.16

Cooperation in Litigation

50

 

 

 

4.17

Assistance

50

 

 

 

4.18

Further Assurances

51

 

 

 

4.19

Insurance

51

 

 

 

4.20

Privileged Matters; Waiver of Conflicts

51

 

 

 

4.21

Post-Closing Confidentiality

52

 

 

 

4.22

Financing

52

 

 

 

4.23

Transition Services Agreement

53

 

 

 

4.24

Holliday Pigments Agreement

53

 

 

 

4.25

Enterprise Agreements

54

 

 

 

4.26

Intellectual Property

55

 

 

 

4.27

Augusta Facility

56

 

 

 

4.28

Employee Benefits Items

60

 

 

 

4.29

Lease Agreements

60

 

 

 

4.30

Post-Closing Assistance with Financial Statements

60

 

iii

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TABLE OF CONTENTS
(Continued)

 

 

 

Page

 

 

 

ARTICLE V                                      CONDITIONS TO THE OBLIGATIONS OF
BUYER

61

 

 

 

5.1

Representations and Warranties; Covenants

61

 

 

 

5.2

Competition Law Clearances

62

 

 

 

5.3

No Order

62

 

 

 

5.4

Material Adverse Effect

62

 

 

 

5.5

Restructurings

62

 

 

 

5.6

Carve-Out Financial Statements

62

 

 

 

5.7

Closing Deliverables

62

 

 

 

5.8

Certification

62

 

 

 

ARTICLE VI                                 CONDITIONS TO THE OBLIGATIONS OF
PARENT

62

 

 

 

6.1

Representations and Warranties; Covenants

62

 

 

 

6.2

Competition Law Clearances

63

 

 

 

6.3

No Order

63

 

 

 

6.4

Closing Deliverables

63

 

 

 

6.5

Certification

63

 

 

 

ARTICLE VII                            TERMINATION

63

 

 

 

7.1

Termination

63

 

 

 

7.2

Effect of Termination

64

 

 

 

ARTICLE VIII                       SURVIVAL AND INDEMNIFICATION

64

 

 

 

8.1

Survival

64

 

 

 

8.2

Indemnification Obligations of Parent

65

 

 

 

8.3

Indemnification Obligations of Buyer

66

 

 

 

8.4

Limitations on Indemnification

66

 

 

 

8.5

Recovery from Third Persons

69

 

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TABLE OF CONTENTS
(Continued)

 

 

 

Page

 

 

 

8.6

Procedure

69

 

 

 

8.7

Further Limitations on Indemnification

71

 

 

 

8.8

Tax Treatment of Payments

72

 

 

 

8.9

Covered Losses

72

 

 

 

ARTICLE IX                                 TAX AND EMPLOYEE MATTERS

73

 

 

 

9.1

Certain Tax Matters

73

 

 

 

9.2

Certain VAT Matters

79

 

 

 

9.3

General Labor and Benefit Plan Matters

80

 

 

 

9.4

U.S. Labor and Benefit Plan Matters

81

 

 

 

9.5

Non-U.S. Labor and Benefit Plan Matters

83

 

 

 

ARTICLE X                                      MISCELLANEOUS

84

 

 

 

10.1

Expenses

84

 

 

 

10.2

Headings

84

 

 

 

10.3

Notices

84

 

 

 

10.4

Assignment

85

 

 

 

10.5

Entire Agreement

85

 

 

 

10.6

Amendment; Waiver

86

 

 

 

10.7

Counterparts

86

 

 

 

10.8

Governing Law; Consent to Jurisdiction; Waiver of Jury Trial

86

 

 

 

10.9

Specific Performance

87

 

 

 

10.10

Interpretation; Absence of Presumption

87

 

 

 

10.11

Third Person Beneficiaries

87

 

 

 

10.12

Representations and Warranties; Disclosure Letter

88

 

 

 

10.13

Severability

88

 

v

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TABLE OF CONTENTS
(Continued)

 

 

 

Page

 

 

 

10.14

NO OTHER REPRESENTATIONS OR WARRANTIES

88

 

 

 

10.15

Buyer Guaranty

89

 

 

 

10.16

Parent Guaranty

89

 

EXHIBITS

 

Exhibit A

Certain Definitions

Exhibit B

List of Companies

Exhibit C

List of JV Entities

Exhibit D

Transition Services Agreement

 

vi

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STOCK PURCHASE AGREEMENT

 

THIS AGREEMENT (this “Agreement”) is made as of September 17, 2013, by and
between Rockwood Specialties Group, Inc., a Delaware corporation (“Parent”), and
Huntsman International LLC, a Delaware limited liability company (“Buyer”). 
Capitalized terms not otherwise defined in this Agreement are used as defined in
Exhibit A.

 

Buyer desires to purchase and Parent desires to sell, or cause to be sold, all
of the issued and outstanding Equity Interests owned or to be owned as of the
Closing by the Sellers in the Entities listed on Exhibit B (collectively, the
“Companies”) and all of the issued and outstanding Equity Interests owned by the
Sellers in the Entities listed on Exhibit C (collectively, the “JV Entities”),
on the terms and subject to the conditions set forth herein.

 

Accordingly, in consideration of the premises and mutual representations,
warranties, covenants and agreements contained herein, and for other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, and intending to be legally bound hereby, the parties hereto
hereby agree as follows:

 

ARTICLE I

 

PURCHASE AND SALE OF SHARES

 

1.1                               Purchase and Sale.  Upon the terms and subject
to the conditions set forth in this Agreement and for the consideration set
forth in Section 1.2, Parent will sell (and will cause the Sellers to sell) to
Buyer at the Closing, and Buyer will purchase from Parent and the Sellers at the
Closing, all of the Shares, free and clear of any Encumbrances.

 

1.2                               Purchase Price and Payment.  The aggregate
consideration for the Shares shall be U.S.$1.325 billion, decreased by a
$225.0 million adjustment for certain pension liabilities of the Business, for a
base cash purchase price of $1.1 billion (the “Base Purchase Price”).   The Base
Purchase Price shall be subject to the following adjustments:  (a) increased or
decreased, as applicable, on a Dollar-for-Dollar basis, by the amount by which
Closing Working Capital is more or less than $515.0 million; (b) increased, on a
Dollar-for-Dollar basis, by the amount of the Retained Cash Balances, if any;
(c) decreased, on a Dollar-for-Dollar basis, by the amount of the Transferred
Company Indebtedness, if any; and (d) decreased, on a Dollar-for-Dollar basis,
by the amount of the Augusta Underspend, if any; (such adjustments collectively,
the “Purchase Price Adjustments” and such consideration, as adjusted, the
“Purchase Price”).  The Purchase Price will also be decreased, on a
Dollar-for-Dollar basis, by the Augusta Cost Overrun Amount and the Augusta
Qualified Costs, if any.  The Base Purchase Price will be allocated among the
Shares in accordance with Schedule A-1 of the Disclosure Letter.

 

1.3                               Closing.  The closing of the transactions
contemplated hereunder (the “Closing”) will take place at the New York offices
of Hughes Hubbard & Reed LLP, at 10:00 a.m., Eastern Time, (i) on the fifth
(5th) Business Day (or, upon notice by Buyer to Parent in response to a written
request of any of its Financing Sources, on the fifteenth (15th) Business Day)
after which all of the conditions required to be satisfied or waived in writing
pursuant to Articles V and VI have been satisfied or waived in writing and
continue to be satisfied or waived in writing as of

 

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such date (other than those requiring the delivery of an Ancillary Document or
the taking of other action at the Closing, and subject to the satisfaction or
written waiver of such conditions) or (ii) at such other time, on such other
date and such other place as may be mutually agreed in writing by Buyer and
Parent.  The date on which the Closing occurs is referred to herein as the
“Closing Date.”  The Closing shall be deemed to be effective between the parties
as of 12:01 a.m. (Eastern Time) on the Closing Date.

 

1.4                               Deliveries at the Closing.  At the Closing:

 

(a)                                 Parent shall deliver, or cause the Sellers
to deliver, to Buyer:

 

(i)                                     stock certificates representing all of
the Shares of Rockwood Pigments, accompanied by stock powers duly executed in
blank, in proper form for transfer of such Shares from Parent to Buyer;

 

(ii)                                  (A) a duly executed instrument of transfer
and assignment by Parent of all of the Shares of Sachtleben LLC, a Delaware
limited liability company (“Sachtleben LLC”), and of all right, title and
interest of Parent in, to and under the limited liability company agreement of
Sachtleben LLC and (B) a duly executed instrument of transfer and assignment by
Parent of all of the Shares of CSI, and of all right, title and interest of
Parent in, to and under the limited liability company agreement of CSI (each, an
“LLC Interest Assignment”);

 

(iii)                               (A) share certificates (or customary
indemnities in respect of any such share certificates that are lost)
representing all of the U.K. Shares, accompanied by stock transfers duly
executed by Rockwood Specialties Limited; and (B) an irrevocable
English-law-governed power of attorney duly executed by Rockwood Specialties
Limited in favor of Buyer, for the purpose of exercising the rights attached to
the U.K. Shares and securing the interest of Buyer in the U.K. Shares during the
period between the Closing and the registration of Buyer as the holder of the
U.K. Shares in the U.K. Company’s register of members;

 

(iv)                              (A) stock transfer forms (ordres de mouvement)
with respect to the sale and purchase of all of the French Shares, duly signed
by the French Seller; (B) the applicable tax forms “Cerfa” no 2759, duly signed
by the French Seller, to be filed with the Tax authorities by Buyer with respect
to the sale and purchase of all of the French Shares; and (C) the share register
of each of the French Companies (comprising the registre des mouvements de
titres and the comptes individuels d’actionnaires) updated in respect of the
sale and purchase of all of the French Shares of such French Company;

 

(v)                                 (A) a counterpart (Ausfertigung) of an
executed notarial share transfer and assignment agreement (Anteilsübertragungs-
und Abtretungsvertrag) effecting the transfer of all the Shares in Sachtleben
Chemie GmbH from Sachtleben GmbH to Buyer, subject to and effective as of the
payment of the Estimated Purchase Price and including an approval of Sachtleben
Chemie GmbH to the transfer of the Shares in itself; (B) a counterpart
(Ausfertigung) of an executed notarial share transfer and assignment agreement
(Anteilsübertragungs- und Abtretungsvertrag) effecting the

 

2

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transfer of all the Shares in Rockwood Pigmente Holding GmbH from Rockwood
Specialties GmbH to Buyer; (C) a counterpart (Ausfertigung) of an executed
notarial share transfer and assignment agreement (Anteilsübertragungs- und
Abtretungsvertrag) effecting the transfer of all the Shares in Silo Pigmente
GmbH from Rockwood Specialties GmbH to Buyer; and (D) a counterpart
(Ausfertigung) of an executed notarial share transfer and assignment agreement
(Anteilsübertragungs- und Abtretungsvertrag) effecting the transfer of all the
Shares in Sachtleben Wasserchemie (Holding) GmbH from Rockwood Specialties GmbH
to Buyer subject to and effective as of the payment of the Estimated Purchase
Price;

 

(vi)                              (A) share certificates representing all of the
Shares of the Italian Company, duly endorsed before an Italian notary public in
the name of Buyer, in proper form for transfer of such Shares from Parent to
Buyer, and evidence of the recording of such transfer in the share register of
the Italian Company, and (B) an executed version of a notarial quota transfer
agreement effecting the transfer of all the Shares in Nuodex Italiana from KL 2
to Buyer, together with evidence that the other quotaholders in Nuodex Italiana
have waived their preemptive rights related to such Shares and have consented to
the transfer of such Shares and with any other consent or waiver required to
perfect the transfer of full ownership title to such Shares to Buyer, as well as
the quotaholders book, if any, updated in respect of the sale and purchase of
such Shares by Buyer from KL 2;

 

(vii)                           share certificates representing all of the
Shares of Holliday Chemical España duly endorsed by KL 2 in favor of Buyer and
the shares’ registry book (libro registro de acciones nominativas) of Holliday
Chemical España updated in respect of the sale and purchase of all of such
Shares;

 

(viii)                        a duly executed instrument of transfer and
assignment between Sachtleben Chemie GmbH, as transferee, and Sachtleben GmbH,
as transferor, in respect of all the shares in Sachtleben Pigments Oy, and share
certificates representing all of the issued and outstanding shares in Sachtleben
Pigments Oy duly endorsed to Sachtleben Chemie GmbH as well as a share and
shareholder register of Sachtleben Pigments Oy, evidencing that Sachtleben
Chemie GmbH has been duly recorded therein as the lawful owner of the shares in
Sachtleben Pigments Oy;

 

(ix)                              a counterpart (Ausfertigung) of a duly
executed notarial share transfer and assignment agreement (Anteilsübertragungs-
und Abtretungsvertrag) between Sachtleben Chemie GmbH, as transferee, and
Sachtleben GmbH, as transferor, in respect of all the shares in Sachtleben
Pigment GmbH, including an approval of Sachtleben Pigment GmbH to the transfer
of the Shares in itself, as well as a notarial certified shareholders’ list of
Sachtleben Pigment GmbH, evidencing that Sachtleben Chemie GmbH has been duly
recorded therein as the lawful owner of the shares in Sachtleben Pigment GmbH
and that such list was duly filed with the competent commercial register;

 

(x)                                 duly executed mutual termination agreements
of the Enterprise Agreements in place between: (A) Sachtleben GmbH and
Sachtleben Chemie GmbH

 

3

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with effect as of or prior to the Closing; (B) Sachtleben GmbH and Sachtleben
Pigment GmbH with effect as of or prior to the transfer of all the Equity
Interests in Sachtleben Pigment GmbH from Sachtleben GmbH to Sachtleben Chemie
GmbH during the Restructurings; (C) Rockwood Specialties GmbH and Silo Pigmente
GmbH with effect as of or prior to the Closing; (D) Rockwood Specialties GmbH
and Rockwood Pigmente Holding GmbH with effect as of or prior to the Closing;
and (E) Rockwood Specialties GmbH and Sachtleben Wasserchemie (Holding) GmbH
with effect as of or prior to the Closing;

 

(xi)                              (A) a duly executed instrument of transfer and
bought and sold note by KL 2 as the transferor in respect of the transfer all of
the Shares of the HK Company in favor of Buyer as the transferee, (B) the share
certificates evidencing all of the Shares of the HK Company (or an express
indemnity in a form satisfactory to Buyer in the case of any found to be
missing), (C) duly passed minutes of a meeting of the board of the HK Company
approving, subject to stamping, the transfer of Shares in the HK Company, and
(D) copies of the memorandum and articles of association of the HK Company, the
HK Company’s most recent annual accounts and any subsequent management accounts
of the HK Company and shall, following the Closing, promptly provide to Buyer
any other documentation (certified as being true copies where so requested)
which Buyer may reasonably request in connection with the submission to the
Stamp Office contemplated by this subclause.  KL 2 shall also provide to Buyer’s
Representatives a check in favor of “The Government of the Hong Kong Special
Administrative Region” equal to one-half of the total stamp duty adjudged
payable by the Stamp Office consequent on the submission contemplated by this
subclause immediately on demand by Buyer;

 

(xii)                           the written resignations of each director and
officer of the Transferred Companies as set forth in Schedule 1.4(a)(xii) of the
Disclosure Letter, such resignations to take effect subject to and as of the
Closing Date;

 

(xiii)                        the written resignations of all supervisory board
members of the Transferred Companies set forth on Schedule 1.4(a)(xiii) of the
Disclosure Letter, such resignations to take effect subject to and as of the
Closing;

 

(xiv)                       except as Buyer may otherwise specify to Parent in
writing not later than three (3) Business Days prior to the Closing, the written
resignation of the auditors of the U.K. Company, such resignation to take effect
subject to and as of the Closing;

 

(xv)                          (A) to the extent in the possession of Parent or a
Seller, the certificates of incorporation, common seals, minute books, statutory
registers, share certificate books (to the extent shares of the applicable
Transferred Company were issued in certificate form) and all other statutory
records of each Transferred Company (provided that delivery of the foregoing to
the offices of the applicable Transferred Company shall be deemed to satisfy
this requirement), and (B) a certificate of good standing for each U.S.
Transferred Company (and the equivalent in other jurisdictions for

 

4

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other Transferred Companies, if customarily used) in their jurisdictions of
organization, dated within five (5) Business Days of the Closing Date;

 

(xvi)                       a Transition Services Agreement substantially in the
form of Exhibit D (the “Transition Services Agreement”), duly executed by
Parent;

 

(xvii)                    copies of resolutions adopted by the board of
directors of Parent, certified as of the Closing Date by the Secretary or an
Assistant Secretary of Parent, approving the execution and delivery of this
Agreement by Parent, and the Ancillary Documents to be executed and delivered by
Parent and the performance by Parent of its obligations hereunder and
thereunder;

 

(xviii)                 copies of resolutions adopted by the board of directors
of Parent Guarantor, certified as of the Closing Date by the Secretary or an
Assistant Secretary of Parent Guarantor, approving the execution and delivery of
this Agreement by Parent Guarantor and the performance by Parent Guarantor of
its obligations hereunder;

 

(xix)                       copies of resolutions adopted by the board of
directors (or comparable governing bodies) of each Seller, certified as of the
Closing Date by the Secretary or an Assistant Secretary (or comparable officers)
of such Seller, approving the sale of all of the Shares held by such Seller
pursuant to the terms of this Agreement and the execution and delivery of the
Ancillary Documents to be executed and delivered by such Seller and the
performance by such Seller of its obligations thereunder;

 

(xx)                          copies of shareholder resolutions (A) adopted by
RSGG as sole shareholder of Sachtleben GmbH approving the sale and transfer of
(1) all of the Shares held by Sachtleben GmbH and (2) all of Sachtleben Chemie
GmbH’s directly and indirectly owned Equity Interests, each pursuant to the
terms of this Agreement and the execution and delivery of the Ancillary
Documents to be executed and delivered by Sachtleben GmbH and the performance by
Sachtleben GmbH of its obligations thereunder; and (B) adopted by KL 2 as sole
shareholder of RSGG approving the sale and transfer of all of the Shares held by
RSGG pursuant to the terms of this Agreement and the execution and delivery of
the Ancillary Documents to be executed and delivered by RSGG and the performance
by RSGG of its obligations thereunder;;

 

(xxi)                       copies of resolutions adopted by the board of
directors of the U.K. Company (and, if applicable, resolutions adopted by the
board of directors of its Subsidiaries) approving, subject only to the
consummation of the Closing, the following: (1) the registration of each of the
transfers relating to the U.K. Shares; (2) the resignations (if any) of the
existing directors and officers referred to in Section 1.4(a)(xii); (3) any
changes in the situation of the registered office, the accounting reference date
and instructions to banks as Buyer may reasonably specify; and (D) the
resignation of the auditors referred to in Section 1.4(a)(xiv);

 

(xxii)                    U.C.C. termination statements (and comparable
instruments in other jurisdictions) in recordable form and/or other appropriate
releases, in form and

 

5

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substance reasonably satisfactory to Buyer, with respect to any recorded
Security Interests or Encumbrances on any Business Assets, other than Permitted
Encumbrances;

 

(xxiii)                 a certificate from Parent to the effect that it is not a
“foreign person” in accordance with Treasury Regulation Section 1.1445-2(b)(2);

 

(xxiv)                all applicable Forms 8023, each duly executed by Rockwood
Holdings, Inc.;

 

(xxv)                   the duly executed French Tax Sharing Termination
Agreements with effect as of or prior to the Closing;

 

(xxvi)                evidence of the transfer of all the Shares in Nuodex
Mexicana S.A. des C.V. from KL 2 to Buyer;

 

(xxvii)             the Lease Agreements, duly executed by Parent or its
Affiliates (other than a Transferred Company); and

 

(xxviii)          the certificate required to be delivered by Parent pursuant to
Section 5.8.

 

(b)                           Buyer shall deliver to Parent:

 

(i)                                     the Estimated Purchase Price in
immediately available funds by wire transfer to a bank account (or bank
accounts) designated by Parent at least two (2) Business Days prior to the
Closing Date;

 

(ii)                                  the Transition Services Agreement, duly
executed by Buyer;

 

(iii)                               copies of resolutions adopted by the board
of managers of Buyer, certified as of the Closing Date by the Secretary or an
Assistant Secretary of Buyer, approving the execution and delivery of this
Agreement and the Ancillary Documents to be executed and delivered by Buyer and
the performance by Buyer of its obligations hereunder and thereunder;

 

(iv)                              copies of resolutions adopted by the board of
directors of Buyer Guarantor, certified as of the Closing Date by the Secretary
or an Assistant Secretary of Buyer Guarantor, approving the execution and
delivery of this Agreement by Buyer Guarantor and the performance by Buyer
Guarantor of its obligations hereunder;

 

(v)                                 the Lease Agreements, duly executed by Buyer
or its Affiliates; and

 

(vi)                              the certificate required to be delivered by
Buyer pursuant to Section 6.5.

 

(c)                                  At the request of Buyer or Parent, Buyer
and Parent shall enter into, and shall cause their applicable Affiliates to
execute, one or more additional agreements, instruments

 

6

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and documents in such form and at such time reasonably agreed by Buyer and
Parent (a “Local Transfer Agreement”), in order to effectuate the transfer of
the Shares of one or more Companies in a particular jurisdiction.  The parties
hereto acknowledge and agree that such Local Transfer Agreements shall not
novate, replace, amend or supersede this Agreement.

 

1.5                               Purchase Price Adjustment.

 

(a)                                 At least five (5) Business Days and not more
than seven (7) Business Days prior to the Closing Date, Parent shall prepare and
deliver to Buyer, or shall cause to be prepared and delivered to Buyer, a
statement, setting forth in reasonable detail its good faith estimate of each of
the Purchase Price Adjustments, determined in accordance with the definitions of
Closing Working Capital, Retained Cash Balances, Transferred Company
Indebtedness, and Augusta Underspend; provided, however, that the Retained Cash
Balances and Transferred Company Indebtedness included in the Estimated Closing
Statement shall not include any Retained Cash Balances or Transferred Company
Indebtedness arising under any Enterprise Agreements, which, however, shall be
included in the final determination of the Retained Cash Balances and
Transferred Company Indebtedness.  The Estimated Closing Statement shall be
accompanied by a certificate executed by a senior financial officer of Parent to
the effect that the Estimated Closing Statement has been prepared in good faith
in accordance with this Section 1.5(a).  If Parent employs a firm of independent
accountants in connection with the preparation of the Estimated Closing
Statement, subject to the execution by Buyer of a customary non-reliance letter,
Parent shall cause such independent accountants to deliver to Buyer and its
Representatives any workpapers used in the preparation of the Estimated Closing
Statement.

 

(b)                                 The Purchase Price payable on the Closing
Date shall be calculated in accordance with Section 1.2 as if Parent’s estimate
of the Purchase Price Adjustments, each as set forth in the Estimated Closing
Statement, were the actual amounts.  The Purchase Price as so estimated is
referred to as the “Estimated Purchase Price.”

 

(c)                                  On or prior to the date that is
seventy-five (75) days following the Closing Date, Buyer shall prepare and
deliver to Parent a statement (the “Final Closing Statement”) setting forth in
reasonable detail its calculation of each of the Purchase Price Adjustments,
determined in accordance with the definitions of Closing Working Capital,
Retained Cash Balances, Transferred Company Indebtedness and Augusta
Underspend.  The Final Closing Statement shall also set forth Buyer’s
calculation of the Purchase Price.  The Final Closing Statement shall be
accompanied by a certificate executed by a senior financial officer of Buyer to
the effect that the Final Closing Statement has been prepared in good faith in
accordance with this Section 1.5(c).  The Final Closing Statement shall also set
forth, and explain, in reasonable detail, any differences between Buyer’s
calculation of the Purchase Price Adjustments from Parent’s estimate of the
Purchase Price Adjustments set forth in the Estimated Closing Statement.

 

(d)                                 Buyer shall make available to Parent all
workpapers and other books and records utilized by Buyer in the preparation of
the Final Closing Statement, and shall make available to Parent those of its
Representatives involved in the preparation of the Final Closing Statement.  If
Buyer employs a firm of independent accountants in connection with the

 

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preparation of the Final Closing Statement, subject to the execution by Parent
of a customary non-reliance letter, Buyer shall cause such independent
accountants to deliver to Parent and its Representatives any workpapers used in
the preparation of the Final Closing Statement.  Parent shall notify Buyer in
writing within forty-five (45) days after Parent’s receipt of the Final Closing
Statement that it accepts the Final Closing Statement or that there is a dispute
(a “Dispute Notice”) as to any item reflected thereon (the “Disputed Items”). 
The Dispute Notice will set forth Parent’s objections, if any, to the Final
Closing Statement in reasonable detail and Parent’s calculation of each of the
Purchase Price Adjustments.  If Parent timely delivers to Buyer a Dispute
Notice, only the Disputed Items shall be deemed to be in dispute, and all other
matters included in the Final Closing Statement delivered by Buyer shall be
deemed to be final and binding on the parties hereto.  The failure by Parent to
deliver to Buyer the Dispute Notice within such period shall be deemed to
constitute Parent’s acceptance of the Final Closing Statement.  After timely
delivery of the Dispute Notice by Parent, the parties will use commercially
reasonable efforts to resolve any Disputed Items, and any resolution by Parent
and Buyer of such Disputed Items shall be final and binding on the parties
hereto.

 

(e)                                  If any Disputed Items cannot be resolved by
the parties within forty-five (45) days after Parent delivers the Dispute Notice
to Buyer, such Disputed Items shall be referred to KPMG LLP or, if KPMG LLP
declines the engagement, any other independent public accounting firm of
national stature which is mutually satisfactory to Parent and Buyer (the
“Selected Accountant”).  The determination of the Selected Accountant shall be
conclusive and binding on each party.  The fees and expenses of the Selected
Accountant shall be shared equally by Parent and Buyer.  Not later than twenty
(20) days after the referral of any Disputed Items to the Selected Accountant,
Parent and Buyer shall concurrently submit written statements to the Selected
Accountant (with a copy to the other party) setting forth their respective
positions regarding the Disputed Items which remain in dispute.  Parent and
Buyer shall instruct the Selected Accountant to render its decision resolving
the dispute within sixty (60) days after submission of the written statements,
and during such period, the parties shall make available to the Selected
Accountant such employees, information, books and records as may be reasonably
requested by the Selected Accountant to make its final determination.  In
resolving any Disputed Item, the Selected Accountant (i) shall be bound by the
provisions of this Section 1.5 and the definitions of Closing Working Capital,
Retained Cash Balances, Transferred Company Indebtedness and Augusta Underspend;
(ii) shall limit its review to the Disputed Items submitted to the Selected
Accountant for resolution and not otherwise investigate matters independently;
and (iii) shall further limit its review of the Disputed Items solely to whether
the Final Closing Statement has been prepared in accordance with this
Section 1.5 or contains any mathematical or clerical error.  The determination
of any Disputed Items cannot, however, be in excess of, or less than, the
greatest or lowest value, respectively, claimed for any such item in the Final
Closing Statement or the Dispute Notice.  Parent and Buyer agree that the
resolution by the Selected Accountant of any Disputed Items shall be final and
binding on the parties hereto.  Parent and Buyer agree that the procedure set
forth in this Section 1.5 for resolving disputes with respect to the Purchase
Price Adjustments shall be the sole and exclusive method for resolving such
disputes, provided, however, that the parties hereto agree that judgment may be
entered upon the determination of the Selected Accountant in any court having
jurisdiction over the party against which such determination is to be enforced.

 

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(f)                                   If the Purchase Price as finally
determined pursuant to this Section 1.5 (i) is less than the Estimated Purchase
Price, Parent shall pay to Buyer an amount equal to the shortfall; or (ii) is
more than the Estimated Purchase Price, Buyer shall pay to Parent an amount
equal to the excess.  Any such payment pursuant to the preceding sentence will
be made by wire transfer of immediately available funds, to an account (or
accounts) designated by Buyer or Parent, as the case may be, on the later of
(x) the second (2nd) Business Day after acceptance or deemed acceptance by
Parent of the Final Closing Statement (as contemplated by paragraph (d) above)
or (y) the second (2nd) Business Day following resolution of any Disputed Items
(as contemplated by paragraphs (d) or (e) above); provided, however, that if the
parties are disputing the final calculation of the Purchase Price, to the extent
part of any payment that would be payable pursuant to this paragraph (f) is not
in dispute, the payor shall pay the amount not in dispute on the date the
payment would otherwise be due but for such dispute by wire transfer of
immediately available funds to an account (or accounts) designated by the
recipient.  All payments made pursuant to this paragraph (f) shall be
accompanied by interest at a rate equal to the Prime Rate per annum from the
Closing Date through (but excluding) the date such payment is made.  “Prime
Rate” shall mean, for any day, the rate of interest per annum (over a year of
360 days) announced by JPMorgan Chase Bank, N.A. (or any successor thereto) from
time to time, as its “base rate” in effect on such date.  Any amounts payable by
either party pursuant to this paragraph (f) may not be reduced by set-off
against any amount(s) payable (whether at such time or in the future or upon the
occurrence of a contingency) by the recipient or any Affiliate of the recipient
to the payor or any Affiliates of the payor.  Any payment required pursuant to
this paragraph (f) shall constitute a payment in respect of the Purchase Price.

 

(g)                                  If the portion of the Purchase Price
allocated to the French Companies is higher than the portion of the Estimated
Purchase Price allocated to the French Companies, Parent shall deliver, or cause
to be delivered, to Buyer tax forms “Cerfa” no 2759, duly signed by the French
Seller, in relation to the additional amounts allocated to the French Companies
no later than on the second (2nd) Business Day after the date when the Purchase
Price has finally been determined pursuant to this Section 1.5.

 

(h)                                 If the delivery deadline date for the Final
Closing Statement or the Dispute Notice is a day that is not a Business Day, the
applicable delivery deadline date shall be the immediately following Business
Day.

 

1.6                               Augusta Cost Overrun Reimbursement.

 

(a)                                 Parent shall pay to Buyer (i) the amount by
which the Augusta Construction Cost paid by Buyer or any of its Affiliates
(including the Transferred Companies) after the Closing (the “Post-Closing
Augusta Construction Cost”) plus the Augusta Spending Benchmark as of the
Closing, exceeds $172.0 million (such excess being, the “Augusta Cost Overrun
Amount”) and (ii) the amount of any Augusta Qualified Costs.

 

(b)                                 Buyer shall prepare and deliver to Parent,
on or prior to the date that is ninety (90) days following the successful
completion of the Performance Test of the Augusta Facility, a statement (the
“Augusta Cost Statement”) setting forth in reasonable detail its calculation of
the Post-Closing Augusta Construction Cost, the Augusta Cost Overrun Amount, if
any, and the Augusta Qualified Costs, if any.  The Augusta Cost Statement shall
be

 

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accompanied by a certificate executed by a senior financial officer of Buyer to
the effect that the Augusta Cost Statement has been prepared in good faith in
accordance with this Section 1.6.

 

(c)                                  Buyer shall make available to Parent all
invoices, receipts and other books and records of Buyer relevant to the
preparation of the Augusta Cost Statement, including all contracts entered into
by Buyer or one of its Affiliates in connection with the construction of the
Augusta Facility, and shall make available to Parent those of its
Representatives involved in the preparation of the Augusta Cost Statement. 
Parent shall notify Buyer in writing within forty-five (45) days after Parent’s
receipt of the Augusta Cost Statement that it accepts the Augusta Cost Statement
or that there is a dispute (an “Augusta Dispute Notice”) as to any item
reflected thereon (the “Augusta Disputed Items”).  The Augusta Dispute Notice
will set forth Parent’s objections, if any, to the Augusta Cost Statement in
reasonable detail and Parent’s calculation of the Post-Closing Augusta
Construction Cost, the Augusta Cost Overrun Amount and, if any, the Augusta
Qualified Costs.  If Parent timely delivers to Buyer an Augusta Dispute Notice,
only the Augusta Disputed Items shall be deemed to be in dispute, and all other
matters included in the Augusta Cost Statement delivered by Buyer shall be
deemed to be final and binding on the parties hereto.  The failure by Parent to
deliver to Buyer the Augusta Dispute Notice within such period shall be deemed
to constitute Parent’s acceptance of the Augusta Cost Statement.  After timely
delivery of the Augusta Dispute Notice by Parent, the parties will use all
commercially reasonable efforts to resolve any Augusta Disputed Items, and any
resolution by Parent and Buyer of such Augusta Disputed Items shall be final and
binding on the parties hereto.

 

(d)                                 If any Augusta Disputed Items cannot be
resolved by the parties within forty-five (45) days after Parent delivers the
Augusta Dispute Notice to Buyer, such Augusta Disputed Items shall be resolved
by arbitration in accordance with Section 4.27(i) below.  Parent and Buyer agree
that the procedures set forth in Sections 1.6 and 4.27(i) for resolving disputes
with respect to the Augusta Cost Overrun Amount and, if any, the Augusta
Qualified Costs shall be the sole and exclusive method for resolving such
disputes; provided, however, that the parties hereto agree that judgment may be
entered upon the determination of the Arbitrator in any court having
jurisdiction over the party against which such determination is to be enforced.

 

(e)                                  Following acceptance or settlement of the
Augusta Cost Statement pursuant to this Section 1.6, Parent shall pay to Buyer
an amount equal to the aggregate of the Augusta Cost Overrun Amount and, if any,
the Augusta Qualified Costs. Any such payment pursuant to the preceding sentence
will be made by wire transfer of immediately available funds, to an account (or
accounts) designated by Buyer on the later of (i) the second (2nd) Business Day
after acceptance or deemed acceptance by Parent of the Augusta Cost Statement
(as contemplated by paragraph (c) above); or (ii) the second (2nd) Business Day
following resolution of any Augusta Disputed Items (as contemplated by
paragraphs (c) or (d) above).  Any amounts payable by Parent pursuant to this
paragraph (e) may not be reduced by set-off against any amount(s) payable
(whether at such time or in the future or upon the occurrence of a contingency)
by Parent or any of its Affiliates to Buyer or any of its Affiliates.  Any
payment required pursuant to this paragraph (e) shall constitute a reduction of
the Purchase Price.

 

(f)                                   If the delivery deadline date for the
Augusta Cost Statement or Augusta Dispute Notice is a day that is not a Business
Day, the applicable delivery deadline date shall be the immediately following
Business Day.

 

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ARTICLE II

 

REPRESENTATIONS AND WARRANTIES OF PARENT

 

Except as set forth in the Disclosure Letter dated as of the date of this
Agreement, delivered by Parent to Buyer contemporaneously with the delivery of
this Agreement (the “Disclosure Letter”), Parent hereby represents and warrants
to Buyer as follows:

 

2.1                               Organization and Good Standing.  Parent is a
corporation duly incorporated, validly existing and in good standing under the
laws of the State of Delaware.  Each of the Sellers is a corporation (or other
Entity) validly existing and (if such Entity is organized in a jurisdiction in
which the concept of good standing or its functional equivalent is applicable)
in good standing or its functional equivalent under the laws of its jurisdiction
of organization.  Schedule 2.1 of the Disclosure Letter lists each Company, each
Subsidiary of the Companies (together with the Companies, but excluding the
Retained Companies, the “Transferred Companies”) and each other Entity that is
engaged in the Business in which a Seller, Company or a Transferred Company
holds a minority equity ownership interest and does not control, including the
JV Entities (the “Non-Controlled Companies”) and the business entity form and
place of organization for each of the Transferred Companies and each of the
Non-Controlled Companies, together with a list of each jurisdiction in which
each U.S. Transferred Company is licensed or qualified to do business.  Each
Transferred Company and, to the knowledge of Parent, each Non-Controlled Company
is (a) validly existing and (if such Transferred Company or Non-Controlled
Company is organized in a jurisdiction in which the concept of good standing or
its functional equivalent is applicable) in good standing or its functional
equivalent under the laws of its jurisdiction of organization; and (b) qualified
to do business and (if such concept of good standing or its functional
equivalent is applicable in such jurisdiction) in good standing or its
functional equivalent in each jurisdiction in which the Assets owned, leased or
operated by it or the nature of the business conducted by it requires such
qualification, except for such failures to be so qualified and in good standing
or its functional equivalent which are not material to the operation of the
Business, taken as a whole.  Each Transferred Company and, to the Knowledge of
Parent, each Non-Controlled Company has the corporate (or other Entity)
authority under the Legal Requirements pursuant to which it is organized to own,
lease or operate the Assets owned, leased or operated by it and to carry on the
business as now being conducted by it.  Parent has made available to Buyer true
and complete copies of each Transferred Company’s and, to the extent within
Parent’s possession or control, each Non-Controlled Company’s Governing
Documents, as in effect on the date of this Agreement.  The Governing Documents
of each of the Transferred Companies and, to the Knowledge of Parent, each of
the Non-Controlled Companies are in full force and effect and none of the
Transferred Companies or, to the Knowledge of Parent, the Non-Controlled
Companies are in violation of their Governing Documents.

 

2.2                               Capitalization.  Schedule 2.2 of the
Disclosure Letter sets forth the authorized capital stock and other Equity
Interests of each Transferred Company and, to the Knowledge of Parent, each
Non-Controlled Company and the number of shares of such stock and Equity
Interests that are issued and outstanding as of the date of this Agreement of
each Transferred Company and, to the Knowledge of Parent, each Non-Controlled
Company.  The ownership as of the date of this Agreement and following the
consummation of the Restructurings of all issued and outstanding shares or other
Equity Interests owned by the applicable Seller in each

 

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Transferred Company and each Non-Controlled Company is set forth on Schedule 2.2
of the Disclosure Letter.  Schedule 2.2 of the Disclosure Letter also sets forth
a list of the Transferred Companies that are, directly or indirectly,
wholly-owned by a Seller and, to the Knowledge of Parent, the ownership of any
outstanding Equity Interests in any Transferred Company by any third Person. 
Schedule 2.2 of the Disclosure Letter also sets forth a list of all shares of
capital stock and other Equity Interests of each Transferred Company of each
class authorized, issued or outstanding.  All of the Shares (including, but only
to the Knowledge of Parent, the Minority Interests) and the Subsidiary Shares
have been validly authorized and issued, are fully paid and, in respect of such
jurisdictions where such concept is applicable, nonassessable and have not been
issued in violation of any preemptive right, purchase option, call option, right
of first refusal, subscription right or any similar right.  There are no bonds,
debentures, notes or other Indebtedness of any Transferred Company or, to the
Knowledge of Parent, any Non-Controlled Company having the right to vote (or
convertible into, or exchangeable for, Equity Interests or other securities of
any Transferred Company or Non-Controlled Company) on any matters on which
holders of Equity Interests may vote.  Except as contemplated by this Agreement,
there is no security, option, warrant, right, call, subscription agreement,
commitment or other Contract of any nature whatsoever to which Parent or any of
its Affiliates (including the Transferred Companies) is a party, that directly
or indirectly (a) calls for the issuance, sale, pledge or other disposition of
any shares of capital stock or other Equity Interests of a Transferred Company
or, to the Knowledge of Parent, a Non-Controlled Company, (b) obligates a
Transferred Company or, to the Knowledge of Parent, a Non-Controlled Company to
make any capital contribution to any Person or participate in any future
issuance of Equity Interests of any Person, (c) obligates a Transferred Company
or, to the Knowledge of Parent, a Non-Controlled Company to grant, offer or
enter into any of the foregoing or (d) relates to the voting or control of the
capital stock or other Equity Interests of a Transferred Company or, to the
Knowledge of Parent, a Non-Controlled Company.  Neither Parent nor any of its
Affiliates (including the Transferred Companies) is a party to, or otherwise
bound by, any voting trust, proxy or other Contract restricting or otherwise
relating to the voting, dividend rights or disposition of any Shares or any
Subsidiary Shares.  No Transferred Company and, to the Knowledge of Parent, no
Non-Controlled Company is a party to, or otherwise bound by, and no Transferred
Company and, to the Knowledge of Parent, no Non-Controlled Company, has granted,
any stock options, appreciation rights, participations, phantom equity or
similar rights.  No Transferred Company nor, to the Knowledge of Parent, no
Non-Controlled Company, owns, directly or indirectly, any capital stock,
membership interest, partnership interest, joint venture interest or other
Equity Interests in any Person, other than a Transferred Company or
Non-Controlled Company.  Following the consummation of the Restructurings, the
applicable Seller shall own the Shares to be sold by such Seller free and clear
of any Encumbrances, other than Permitted Encumbrances, and the Sellers will
transfer to Buyer at the Closing good and valid title to the Shares, free and
clear of any Encumbrances, and will transfer good and valid title to the
Minority Interests free and clear of all Encumbrances created by Parent or any
of its Affiliates.

 

2.3                               Authority, Approvals and Consents.

 

(a)                                 Parent has the corporate power and authority
to execute, deliver and perform this Agreement and the Ancillary Documents to be
executed and delivered by Parent and to consummate the transactions contemplated
hereby and thereby.  At the Closing, each other Seller will have the corporate
(or other Entity) power and authority, to execute, deliver and

 

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perform the Ancillary Documents to be executed, delivered and performed by such
Seller and to consummate the transactions contemplated hereby and thereby.  The
execution, delivery and performance by Parent of this Agreement and each of the
Ancillary Documents to which it will at Closing be a party, and the consummation
by Parent of the transactions contemplated hereby and thereby, have been, and at
the Closing the execution, delivery and performance by each Seller of the
Ancillary Documents to which it is a party and the consummation of the
transactions contemplated hereby and thereby by such Sellers will have been,
duly authorized and approved by the board of directors (or comparable governing
body) of each of the Sellers, and no other corporate (or other Entity) actions
or proceedings on the part of Sellers or Equityholders of Sellers are necessary
to authorize and approve this Agreement or the Ancillary Documents to be
executed and delivered by Sellers and the transactions contemplated hereby and
thereby.  This Agreement has been duly executed and delivered by Parent, and the
Ancillary Documents to be executed and delivered by any Seller at the Closing
will be duly executed and so delivered by such Seller.  This Agreement
constitutes, and at the Closing each Ancillary Document to be executed and
delivered by any Seller will constitute, a legal, valid and binding obligation
of such Person, enforceable against such Person in accordance with its terms,
except as such enforceability may be limited by the Bankruptcy and Equity
Exceptions.

 

(b)                                 The execution, delivery and performance by
Parent of this Agreement and by the applicable Sellers of the Ancillary
Documents to be executed, delivered and performed by them, the consummation by
Parent and the applicable Sellers of the transactions contemplated hereby and
thereby, and compliance by the applicable Sellers hereof and thereof, do not and
will not:

 

(i)                                     contravene or violate any provision of
any of the Governing Documents of Parent, the Sellers or any Transferred Company
or Non-Controlled Company;

 

(ii)                                  conflict with, result in a breach of any
provision of, constitute a default under, result in the modification, suspension
or cancellation of, give rise to the loss of a benefit under, result in the
creation of any Encumbrance (other than Permitted Encumbrances) on, or entitle
any Person (with or without due notice or lapse of time or both) to terminate,
cancel, accelerate, modify or call a default with respect to, or decrease any
benefit or obligation under, any Contract or Order to which Parent, any of the
Sellers is a party or to which Parent or any of the Sellers, or any of their
Assets is subject, except, in each case, as would not reasonably be expected,
individually or in the aggregate, to be material to the operation of the
Business, taken as a whole;

 

(iii)                               in any material respect, violate or conflict
with any Legal Requirements (other than Antitrust Laws) applicable to any
Seller, any Transferred Company or, to the Knowledge of Parent, any
Non-Controlled Company or any of their businesses or Assets;

 

(iv)                              require Parent, any Seller, any Transferred
Company or, to the Knowledge of Parent, any Non-Controlled Company to obtain,
secure or make any material Approval, except for (A) Approvals in respect of
Permits, (B) compliance with and filings under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended

 

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(the “HSR Act”); (C) Approval from the European Commission pursuant to the
European Council Regulation (EC) No 139/2004 on the control of concentrations
between undertakings, OJ L24, 29 January 2004, p. 1-22 (the “EMR”); and (D) all
Approvals required to be obtained from, or any filings or other notifications
required to be made to or with, any non-U.S. Governmental Authority in
connection with the transactions contemplated hereby under Applicable Non-U.S.
Antitrust Laws (the “Non-U.S. Antitrust Approvals”); or

 

(v)                                 result in the cancellation, revocation,
suspension, or modification of any Permit or Approval with respect to Parent,
Sellers, any of the Transferred Companies or any of their respective businesses
or Assets, except as would not reasonably be expected, individually or in the
aggregate, to be material to the operation of the Business taken as a whole.

 

2.4                               Financial Statements.  (a) Attached as
Schedule 2.4(a) of the Disclosure Letter are (i) the unaudited combined balance
sheet of the Business as of December 31, 2012 and the related unaudited combined
statement of profit and losses for the twelve-month period then ended, (ii) an
unaudited statement of Capital Expenditures on a cash basis by Parent and its
Affiliates with respect to the Business for the year ended December 31, 2012,
(iii) the unaudited combined balance sheet of the Business as of June 30, 2013
(the “Balance Sheet”, and such date, the “Balance Sheet Date”) and the related
unaudited combined statement of profit and losses for the six-month period then
ended June 30, 2013, and (iv) an unaudited statement of Capital Expenditures on
a cash basis by Parent and its Affiliates with respect to the Business for the
six months ended June 30, 2013 (all such financial statements, including the
related notes and schedules thereto, the “Financial Statements”).  The Financial
Statements (A) fairly present in all material respects the combined financial
position of the Business as of the dates indicated and the combined results of
operations of the Business for the periods indicated; and (B) were prepared in
accordance with GAAP applied on a consistent basis throughout the periods
specified, except as expressly set forth therein and except that the Financial
Statements as of and for the six-month period ended on June 30, 2013 are subject
to normal and recurring year-end audit adjustments (the effect of which would
not be material).

 

(b)                                 All books and records of the Business, taken
as a whole, are accurate and complete in all material respects.  The Transferred
Companies maintain systems of internal accounting controls sufficient in all
material respects to enable officers of Parent to give the certifications called
for by Rule 13a-14(a) and (b) under the Securities Exchange Act of 1934, as
amended.

 

(c)                                  Since January 1, 2011, no director or
officer of Parent or of any of the Transferred Companies or, to the Knowledge of
Parent, any non-officer employee, external auditor, external accountant or
outside counsel of Parent or any of the Transferred Companies or, to the
Knowledge of Parent, the Non-Controlled Companies, has received or otherwise
been made aware of any material written complaint, allegation or claim regarding
the accounting or auditing practices, procedures, methodologies or methods of
any of the Transferred Companies or the Non-Controlled Companies or their
respective internal accounting controls, including any material written
complaint, allegation or claim that any of the Transferred Companies has engaged
in questionable accounting or auditing practices.

 

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2.5                               Absence of Undisclosed Liabilities;
Indebtedness.

 

(a)                                 The Transferred Companies and, to the
Knowledge of Parent, the Non-Controlled Companies, do not have any liabilities
(whether accrued or contingent and whether or not required under GAAP to be
reflected on a balance sheet), except:  (i) as and to the extent reflected or
reserved against on the Balance Sheet; (ii) liabilities incurred or arising in
the ordinary course of business consistent with past practice (and not arising
out of a breach of or default under any Contract or a violation of Legal
Requirements) after the Balance Sheet Date; (iii) those arising under Benefit
Plans, Business Agreements, Leases and Permits (and not arising out of a breach
or violation thereof or default thereunder); and (iv) other liabilities that
would not reasonably be expected, individually or in the aggregate, to be
material to the Business, taken as a whole.

 

(b)                                 Schedule 2.5(b) of the Disclosure Letter
sets forth a list of all Indebtedness of the Transferred Companies as of the
date of this Agreement.

 

2.6                               Absence of Certain Changes or Events.

 

(a)                                 Since the Balance Sheet Date to the date of
this Agreement, (i) the Business has been operated in all material respects in
the ordinary course of business consistent with past practice; and (ii) there
has not been any change, event, occurrence, effect, circumstance or development
that has had or could reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect.

 

(b)                                 Since the Balance Sheet Date to the date of
this Agreement, there has not been any act or omission taken by Parent or any of
the Sellers or their respective Affiliates (other than the Transferred
Companies) (to the extent related to the Business) or the Transferred Companies
that, if taken during the period from the date of this Agreement through the
Closing Date without Buyer’s consent, would constitute a breach of Section 4.3.

 

(c)                                  Since the Balance Sheet Date, there has not
been any physical damage, destruction or loss to any Business Assets that, after
taking into account any insurance proceeds received or receivable with respect
to the foregoing, would reasonably be expected, individually or in the
aggregate, to be material to the Business, taken as a whole.

 

2.7                               Taxes.

 

(a)                                 The Transferred Companies have timely filed
or have had filed on their behalf, taking into account any applicable
extensions, all material Tax Returns which are required to be filed by or with
respect to them, and such Tax Returns are true, correct and complete in all
material respects.

 

(b)                                 All material Taxes required to be paid by
the Transferred Companies (or for which the Transferred Companies may be liable)
have been timely paid, after giving effect to any applicable extensions.

 

(c)                                  The Transferred Companies have withheld and
timely paid all material Taxes required to have been withheld and paid, and all
corresponding deposit obligations have

 

15

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been satisfied, in connection with amounts paid or owing to any employee,
independent contractor, creditor, Equityholder, or other Person.

 

(d)                                 There are no Proceedings or claims made in
writing pending or, to the Knowledge of Parent, threatened with respect to any
of the Transferred Companies relating to material Taxes.

 

(e)                                  There are no Contracts in force or effect
providing for a waiver or an extension of time with respect to the assessment or
collection of any material Tax of or with respect to a Transferred Company.

 

(f)                                   No Transferred Company (nor any
predecessor thereof) has been a party to any “listed transaction” as defined in
Treasury Regulation Section 1.6011-4(b)(2) or any similar provision of state,
local or non-U.S. Legal Requirements.

 

(g)                                  There is no outstanding power of attorney
authorizing anyone to act on behalf of any of the Transferred Companies in
connection with any Tax, Tax Return or Proceeding relating to a Tax that will
remain in effect following the Closing, other than any such power of attorney
authorizing a person to act on behalf of a consolidated, combined or unitary
group in which a Transferred Company is included.

 

(h)                                 None of the Transferred Companies has
distributed the stock of another Person, or had its stock distributed by another
Person, in a transaction that was purported or intended to be governed in whole
or in part by Section 355 of the Code within the two-year period ending on the
date hereof or in a distribution which could otherwise constitute part of a
“plan” or “series of related transactions” (within the meaning of
Section 355(e) of the Code) in conjunction with the transactions contemplated by
this Agreement.

 

(i)                                     None of the Transferred Companies is a
party to or bound by any Tax sharing agreement, Tax allocation agreement or Tax
indemnity agreement or similar Contract with any Person that will remain in
effect after the Closing Date, except for any such agreement pursuant to the
terms of a commercial contract, including a lease or financing agreement, not
principally relating to Taxes.

 

(j)                                    No material assessment, deficiency or
adjustment for Taxes with respect to the Transferred Companies has been claimed,
proposed or assessed in writing by any Governmental Authority that has not been
resolved and paid in full.

 

(k)                                 No material claim has been made in writing
in the past three (3) years by a Governmental Authority in a jurisdiction in
which a Transferred Company does not file Tax Returns or pay Taxes that such
Transferred Company is or may be required to file a Tax Return or pay Taxes in
that jurisdiction.

 

(l)                                     No Transferred Company is currently the
beneficiary of any material Tax holiday or material Tax abatement.

 

(m)                             No Transferred Company will be required to
include any material item of income in, or exclude any material item of
deduction from, taxable income for any taxable

 

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period (or portion thereof) ending after the Closing Date as a result of any:
(i) adjustment under Section 481 of the Code resulting from a change in method
of accounting for a taxable period ending on or prior to the Closing Date;
(ii) “closing agreement” as described in Section 7121 of the Code (or any
corresponding or similar provision of state, local or non-U.S. Legal
Requirements) executed on or prior to the Closing Date; (iii) installment sale
or open transaction disposition made on or prior to the Closing Date; or
(iv) election made pursuant to Section 108(i) of the Code (or any corresponding
or similar provision of state, local or non-U.S. Legal Requirements) on or prior
to the Closing Date.

 

(n)                                 There are no Encumbrances (other than
Permitted Encumbrances) on any of the assets of the Transferred Companies or on
the Shares that are attributable to any material Tax liability or payment
obligation.

 

(o)                                 Schedule 2.7(o) of the Disclosure Letter
sets forth the U.S. Federal Income Tax classification of each Transferred
Company and Non-Controlled Company and the U.S. Federal entity classification
elections that will be filed on or before the Closing Date with effect prior to
the Closing Date.

 

(p)                                 No Transferred Company organized outside of
the United States holds any asset that is a “United States real property
interest” within the meaning of Section 897(c) of the Code.

 

2.8                               Legal Matters.

 

(a)                                 (i) There is no material Proceeding pending
or, to the Knowledge of Parent, threatened, against the Business, Parent or any
of its Affiliates (other than a Transferred Company) (with respect to the
Business), any Transferred Company, any officer or director of any Transferred
Company (in such person’s capacity), or any Business Assets nor any Proceeding
that seeks to restrain, enjoin or otherwise prohibit in any material respect or
to obtain damages with respect to the consummation of the transactions
contemplated by this Agreement; and (ii) no Transferred Company is subject to or
in default of any material Order, other than those of general applicability.

 

(b)                                 Since January 1, 2011 and prior to the date
of this Agreement, neither Parent nor any of its Affiliates (including the
Transferred Companies) has settled any Proceeding relating to the Business
involving the payment of consideration in excess of $500,000.

 

(c)                                  The Business is being conducted in all
material respects in compliance with all applicable Legal Requirements.  Since
January 1, 2011 and prior to the date of this Agreement, neither Parent nor any
of its Affiliates (other than a Transferred Company) (with respect to the
Business) or any Transferred Company has received any written notice alleging
any material violation or non-compliance with any Legal Requirement which
remains outstanding and unresolved. To the Knowledge of Parent, no Transferred
Company or Non-Controlled Company is under investigation with respect to any
violation of Legal Requirements.

 

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2.9                               Property.

 

(a)                                 All real property (other than the
Non-Operating Sites) owned by any of the Transferred Companies (the “Owned Real
Property”) is set forth on Schedule 2.9(a) of the Disclosure Letter, which sets
forth which Real Property is owned by which Person.  The Transferred Companies
have good and marketable title to the Owned Real Property, free and clear of all
Encumbrances other than Permitted Encumbrances and Encumbrances set forth on
Schedule 2.9(a) of the Disclosure Letter.  Except as disclosed on Schedule 2.9
(a) of the Disclosure Letter, no Transferred Company has leased or sublet, as
lessor, any of the Owned Real Property.

 

(b)                                 Schedule 2.9(b) of the Disclosure Letter
sets forth a list as of the date of this Agreement of all leases, including
amendments thereto, of real property (i) with annual rental payments in excess
of U.S.$100,000 or (ii) relating to current manufacturing sites, in each case,
leased by the Transferred Companies (the “Leases”).  Each Lease is in full force
and effect and constitutes a valid and legally binding obligation of the
applicable Transferred Company and, to the Knowledge of Parent, of each other
party thereto, enforceable against such Transferred Company and, to the
Knowledge of Parent, each other party thereto, in accordance with its terms,
except as such enforceability may be limited by the Bankruptcy and Equity
Exceptions.  Neither any Transferred Company nor, to the Knowledge of Parent,
any other party to any Lease is in material breach or default of or under any
such Lease, and to the Knowledge of Parent, no event has occurred which (with
notice or lapse of time or both) could reasonably be expected to constitute a
material breach or default under any such Lease.  The execution, delivery and
performance by Parent of this Agreement and the Ancillary Documents to be
executed and delivered by Parent or any of the Sellers, and the consummation of
the transactions contemplated hereby and thereby by Parent and the Sellers, do
not and will not, in any material respect, conflict with, result in the
modification or cancellation of, or give rise to any default or right of
termination in respect of (with due notice or lapse of time or both) any such
Lease.  As of the date of this Agreement, no written notice of material breach
or of any event which (with lapse of time) could reasonably be expected to
constitute a material breach has been received by a Transferred Company from any
landlord, any Governmental Authority or any other Person in relation to any
Lease.  No Transferred Company has leased or sublet, as lessor or sublessor, any
of the Leased Real Property.  Parent has made available to Buyer true and
complete copies in all material respects of all Leases.

 

(c)                                  No condemnation, eminent domain or
expropriation Proceeding against or affecting all or any portion of the Real
Property is pending or, to the Knowledge of Parent, threatened.

 

(d)                                 Except as disposed of in the ordinary course
of business since the Balance Sheet Date, as of the date of this Agreement, the
Transferred Companies have good and valid title to all material tangible
personal property reflected on the Balance Sheet or acquired by it after the
Balance Sheet Date, and such property is held free and clear of all Encumbrances
other than Permitted Encumbrances.

 

(e)                                  After giving effect to the Restructurings
and the Capital Expenditures budgeted in the Capex Plan or currently being
undertaken by the Transferred Companies, all

 

18

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material improvements and fixtures on all the Real Property, and all material
machinery, equipment and other tangible property owned or leased to the
Transferred Companies and currently used by the Business (“Property”), are in
all material respects fit for the purpose in which they are being used, in good
condition, except for ordinary wear and tear.

 

(f)                                   The Property, together with the
Administrative Assets and the Lease Agreements, and after taking into account
Assets, goods and services purchased or leased by the Transferred Companies in
the ordinary course of business, will, at Closing, be sufficient in all material
respects, for the conduct of the Business immediately following the Closing by
Buyer as it is presently conducted by Parent and its Affiliates (including the
Transferred Companies).  The Real Property and the Leased Sites constitute all
material real property used by the Transferred Companies in the conduct of their
operations as of the date of this Agreement, other than Administrative Services
and other services provided by third Persons.  The Real Property does not
include any real property not currently used in the operation of the Business.
The Retained Companies do not own any material intangible Assets that are
necessary in order to conduct the Business immediately following the Closing as
it is presently conducted by Parent and its Affiliates (including the
Transferred Companies).

 

2.10                        Material Contracts.

 

(a)                                 Schedule 2.10(a) of the Disclosure Letter
sets forth a list as of the date of this Agreement of each of the following
Business Agreements (collectively, the “Material Contracts”):

 

(i)                                     any Business Agreement pursuant to which
Indebtedness of any Transferred Company has been incurred (other than those in
respect of trade payables arising in the ordinary course of business);

 

(ii)                                  any guaranty by the Transferred Companies
of any obligation for borrowed money (other than guaranties of credit cards of
officers and employees of the Transferred Companies), excluding endorsements
made for collection in the ordinary course of business;

 

(iii)                               any obligation to make payments, contingent
or otherwise, arising out of the prior acquisition of any Assets or businesses
of third Persons (other than accounts payable and accrued liabilities
constituting current liabilities);

 

(iv)                              any Business Agreement containing
non-competition, non-solicitation or other limitations restricting the current
or future development, manufacture, marketing or distribution of the products
and services by any Transferred Company, or any Transferred Company’s ability to
compete in any line of business, in any geographic area or with any Person or to
solicit the employees or customers of any Person (other than confidentiality and
similar agreements entered into in the ordinary course of business);

 

(v)                                 any Business Agreement for the employment or
engagement of any officer, director, employee or other Person on a full-time,
part-time, consulting or other basis that provides for the payment of any cash
or other compensation, severance or

 

19

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benefits as a result of the execution of this Agreement or any Ancillary
Document or the consummation of the transactions contemplated hereby or thereby;

 

(vi)                              any Business Agreement (other than (A) for the
purchase or sale of goods and services on a purchase order basis in the ordinary
course of business and (B) Leases) which involved the payment of consideration
to or by a Transferred Company, in each case, by or to a third Person, in excess
of U.S.$2,500,000 during the fiscal year ended December 31, 2012 or are
reasonably expected to involve the payment of consideration in excess of
U.S.$2,500,000  to or by a Transferred Company in any twelve (12) month period;

 

(vii)                           any Business Agreement pursuant to which a
Transferred Company purchases goods or services (other than on a purchase order
basis) that is a Business Agreement with a mandatory take or pay or similar
purchase requirement for all or a portion of such Transferred Company’s purchase
obligations with respect to such good or service (a “Take or Pay Agreement”);

 

(viii)                        any Business Agreement that contains any product
or service guaranty or warranty or right of return that is not consistent with
the terms customarily provided by the Business in the ordinary course of
business;

 

(ix)                              any Business Agreement that is a partnership,
joint venture, profit-sharing, loss-sharing or similar Contract;

 

(x)                                 any Business Agreement that contains any
form of most-favored nation provision in favor of any customer or supplier of
the Business or any other Person;

 

(xi)                              any Business Agreement pursuant to which a
Transferred Company purchases goods or services (other than on a purchase order
basis) that is a sole source purchase Contract or another Contract with
exclusivity provisions applicable to a Transferred Company;

 

(xii)                           any Business Agreement to which a Governmental
Authority, or a Representative of a Governmental Authority is a party;

 

(xiii)                        any Business Agreement under which any Transferred
Company has made any advance, loan, extension of credit or capital contribution
to, or other investment in, any Person (other than a Transferred Company or a
Non-Controlled Company and other than loans or advances to employees or
extensions of trade credit in the ordinary course of business);

 

(xiv)                       any Business Agreement granting an Encumbrance
(other than a Permitted Encumbrance) upon any Shares or Business Assets;

 

(xv)                          any Business Agreement entered into outside the
ordinary course of business providing for indemnification by a Transferred
Company of any Person that remains in effect as of the date of this Agreement
with respect to liabilities relating to any former business of any Transferred
Company or any predecessor Person;

 

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(xvi)                       any Business Agreement relating to the acquisition
or disposition of any business, material Assets (other than Inventory sales in
the ordinary course of business) or Equity Interests of a third Person outside
of the ordinary course of business;

 

(xvii)                    all Business Agreements (A) for the cleanup, abatement
or other actions in connection with any Hazardous Substances or the Remedial
Action of any existing Environmental Condition, in each case that are not
terminable without penalty on thirty (30) days’ or fewer notice or that require
payments by the Transferred Company or Non-Controlled Company in an amount in
excess of $125,000 per annum or (B) involving payment by Parent or one of its
Affiliates to a third party in an amount in excess of $125,000 for the
performance of any ongoing environmental audit or study at an individual
Acquired Site or Leased Site;

 

(xviii)                 any Derivatives Contract that will be binding on a
Transferred Company after the Closing;

 

(xix)                       any Business Agreement primarily related to the use,
development, support or disaster recovery of the IT Systems used primarily by
the Transferred Companies reasonably expected to involve the payment of
consideration in an amount in excess of $1,000,000 on an annual basis;

 

(xx)                          any Business Agreement pursuant to which
(A) Intellectual Property that is material to the Business is licensed to a
Transferred Company by a third Person (other than license agreements for
“off-the-shelf” software on generally standard terms and conditions); or (B) a
Transferred Company has (1) granted to a third Person an exclusive right with
respect to Intellectual Property or (2) granted to a third Person any right with
respect to Intellectual Property that is material to the Business;

 

(xxi)                       any Business Agreement relating to any outstanding
commitment for Capital Expenditures in excess of $2,000,000;

 

(xxii)                    any Business Agreement relating to the settlement of
any Proceeding that (A) contains any obligations or commitments of a Transferred
Company to make payments to a third person in excess of $500,000 after the date
of this Agreement or (ii) limits the conduct of a Transferred Company other than
in the ordinary course of business; and

 

(xxiii)                 the Contracts for IT Systems of the Business listed on
Schedule 2.10(a)(xxiii) of the Disclosure Letter.

 

(b)                                 Each Material Contract is in full force and
effect and constitutes a valid and legally binding obligation of the applicable
Transferred Company and, to the Knowledge of Parent, of each other party
thereto, enforceable against such Transferred Company and, to the Knowledge of
Parent, each other party thereto, in accordance with its terms, except as such
enforceability may be limited by the Bankruptcy and Equity Exceptions.  Neither
any Transferred Company nor, to the Knowledge of Parent, any other party to any
Material Contract is in material breach or default of or under any such Material
Contract, and to Parent’s Knowledge, no event has occurred that with the lapse
of time or the giving of notice, or both,

 

21

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would constitute a material breach or default of any other party thereto.  The
execution, delivery and performance by Parent of this Agreement and the
Ancillary Documents to be executed and delivered by Parent or any of the
Sellers, and the consummation of the transactions contemplated hereby and
thereby by Parent and the Sellers, do not and will not conflict with, result in
the modification or cancellation of, render unenforceable, or give rise to any
right of termination in respect of (with due notice or lapse of time or both)
any Material Contract.  No party to any of the Material Contracts has exercised
in writing any termination rights with respect thereto, and to the Knowledge of
Parent, no party has given written notice of any material dispute with respect
to any Material Contracts.  Parent has made available to Buyer true, correct and
complete copies of all Material Contracts, together with all amendments,
modifications or supplements thereto.

 

2.11                        Labor Relations.

 

(a)                                 There is as of the date of this Agreement,
and since at least January 1, 2011 has been, no labor strike, organized work
stoppage, slowdown, picketing or lockout (each, an “Industrial Action”) in
effect or, to the Knowledge of Parent, threatened against any Transferred
Company.

 

(b)                                 There is as of the date of this Agreement,
and since at least January 1, 2011 has been, no material dispute with, or to the
Knowledge of Parent any organization or recognition campaign by, any labor
union, works council, trade union or other employee representative body relating
to any Business Employees.

 

(c)                                  Each U.S. collective bargaining agreement,
each material non-U.S. collective bargaining agreement, each material works
agreement (Betriebsvereinbarungen) on the group level
(Konzernbetriebsvereinbarungen) and on the level of the individual Transferred
Companies (Betriebsvereinbarungen und Gesamtbetriebsvereinbarungen) and each
other material Contract with any labor union, works council, trade union or
Representative of any Business Employees, and in each case binding upon any of
the Transferred Companies (each, a “Collective Bargaining Agreement”), is set
forth on Schedule 2.11(c) of the Disclosure Letter.  Parent has made available
to Buyer true and complete copies of each such Collective Bargaining Agreement.

 

(d)                                 The Transferred Companies have fulfilled
their obligations to inform, consult and/or obtain any required and mandatory
opinion from any applicable works council (comité d’entreprise), union, or any
other employee representative body for the purpose of entering into this
Agreement.

 

(e)                                  Parent will deliver to Buyer on the date of
this Agreement a separate Schedule 2.11(e) setting forth a complete and accurate
list, as of the date of this Agreement, of all of the Business Employees (on an
anonymous basis), indicating their (i) job title, (ii) current base salary or
wage rate, (iii) start date and (iv) location.

 

(f)                                   There are as of the date of this
Agreement, and since at least January 1, 2011 have been, no material charges,
complaints, grievances, investigations, audits or other Proceedings commenced
with respect to a Transferred Company under any Legal Requirements affecting or
relating to the employment relationship, and no material charges, complaints,

 

22

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grievances, investigations or other Proceedings are, to Parent’s Knowledge,
threatened under any such Legal Requirements.

 

(g)                                  To the Knowledge of Parent, each
Transferred Company is as of the date of this Agreement, and since at least
January 1, 2011 has been, in material compliance with all applicable Legal
Requirements relating to the employment of labor, including labor and employment
practices, terms and conditions of employment, wages and hours, overtime
payments, recordkeeping, employee classification, non-discrimination, employee
benefits, employee leave, payroll documents, record retention, equal
opportunity, immigration, occupational health and safety, severance, termination
or discharge, co-operation obligations under the Finnish Act on Co-Operation
within Undertakings (Laki yhteistoiminnasta yrityksissä) and collective
bargaining, and each Transferred Company is as of the date of this Agreement,
and has been since at least January 1, 2011, in material compliance with any
Legal Requirements concerning retention and classification of independent
contractors.  There are no former employees of Sachtleben Pigments Oy whose
employment contracts have been terminated within the period of nine (9) months
prior to the date hereof on economic or production related grounds
(taloudellinen tai tuotannollinen peruste) and who are entitled to be
re-employed by Sachtleben Pigments Oy in accordance with Chapter 6, Section 6 of
the Finnish Employment Contracts Act (Työsopimuslaki).

 

(h)                                 Schedule 2.11(h)(i) of the Disclosure Letter
sets forth a list of each employee of Parent and its Subsidiaries whose primary
job responsibility involves providing services to the Business but, as of the
date of this Agreement, is not employed by a Transferred Company (each, a
“Remote Employee”).  Each employee of the Transferred Companies has a primary
job responsibility of providing services relating to the Business other than the
employees listed on Schedule 2.11(h)(ii) of the Disclosure Letter (each, a
“Seller Retained Employee”).

 

(i)                                     Since January 1, 2013 through the date
of this Agreement, no Transferred Company has effectuated (i) a “plant closing”
(as defined in the Worker Adjustment and Retraining Notification Act of 1988
(the “WARN Act”) or any similar Legal Requirement) affecting any site of
employment or one or more facilities or operating units within any site of
employment or facility of a Transferred Company or (ii) a “mass layoff” (as
defined in the WARN Act, or any similar Legal Requirement) affecting any site of
employment or facility of a Transferred Company.

 

(j)                                    No Transferred Company is bound by
(i) any restriction with respect to closure, downsizing or other restructuring
affecting its workforce or a portion thereof, except for any restrictions under
applicable Legal Requirements or (ii) any obligation to guarantee a certain
number of employees at any of its sites.

 

(k)                                 None of the Business Employees listed on
Schedule 2.11(k) of the Disclosure Letter (the “Key Employees”) has, as of the
date of this Agreement, been given or have given notice of termination, and, to
the Knowledge of Parent, no Key Employee has expressed the intention to
terminate or otherwise alter his or her employment or service relationship with
a Transferred Company.

 

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2.12                        Employee Benefits.

 

(a)                                 Schedule 2.12(a) of the Disclosure Letter
sets forth a list of (i) each material “employee benefit plan” within the
meaning of Section 3(3) of ERISA (whether or not subject to ERISA); (ii) each
material employment, indemnification, severance, retention or change-in-control
plan, policy, agreement or arrangement and (iii) each other material employee
benefit or compensation plan, policy, agreement or arrangement (whether of an
individual or collective nature), including any stock option, stock purchase,
stock award, deferred compensation, pension, retirement, death, old-age
part-time (Altersteilzeit) savings, profit sharing, incentive, bonus,
commission, health, life insurance, cafeteria, flexible spending, dependent
care, fringe benefit, anniversary, jubilee, holiday, paid time off or disability
plans, policies, agreements or arrangements, in each case, which is sponsored or
maintained by Parent, the Transferred Companies or any of their Affiliates, or
to which Parent, the Transferred Companies or any of their Affiliates is
required to make contributions, on behalf of any current or former employees,
officers, directors or consultants of the Transferred Companies (the “Relevant
Employees”) (other than, with respect to any plan or arrangement not sponsored
or maintained by the Transferred Companies or to which the Transferred Companies
are not required to contribute, the Resigning Officers and Directors) or
pursuant to which the Transferred Companies have any actual or potential
liability (collectively, “Benefit Plans”).  Benefit Plans that are sponsored or
maintained solely by one or more of the Transferred Companies are denoted by
asterisk on Schedule 2.12(a) of the Disclosure Letter and are referred to herein
as “Transferred Company Benefit Plans”).  Benefit Plans shall not include any
statutory non-U.S. plans with respect to which any Transferred Company, Parent
or any of their Affiliates are obligated to make contributions or comply with
under applicable Legal Requirements.

 

(b)                                 With respect to each Transferred Company
Benefit Plan, prior to the date hereof true, correct, and complete copies (or,
to the extent no such copy exists, an accurate description) of the applicable
following documents have been made available to Buyer: (i) all current plan
documents (including trust agreements, insurance contracts and other funding or
service arrangements) and any amendments thereto; (ii) Forms 5500 and attached
schedules, including audited financial statements and actuarial valuation
reports, for the most recent plan year for which such Forms 5500 have been
filed; (iii) any estimates received regarding withdrawal liability with respect
to a Benefit Plan that is a Multiemployer Plan; (iv) summary plan descriptions
or other written summaries; (v) the most recent determination letter received
from the IRS; (vi) the most recent actuarial valuation statements and any formal
interim valuation statements that have been prepared in writing by the actuary
of the applicable Transferred Company Benefit Plan since that valuation in
relation to any Transferred Company Benefit Plan; and (vii) each guarantee or
letter of credit which has been provided in relation to each Transferred Company
Benefit Plan.

 

(c)                                  Since January 1, 2011 and through the date
of this Agreement, each Transferred Company Benefit Plan has, in all material
respects, been established, funded, maintained and administered in compliance
with its terms and with the applicable provisions of ERISA, the Code and all
other applicable Legal Requirements, and as of the date of this Agreement, the
Transferred Companies are in compliance, in all material respects, with all
applicable provisions of ERISA, the Code and all other applicable Legal
Requirements, in each case, as they relate to any Transferred Company Benefit
Plan; provided, however, that in the case

 

24

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of the Sachtleben Pigments Oy Pension Fund or any other Finnish Transferred
Company Benefit Plan provided by a third party insurer, this representation is
limited to Parent’s Knowledge.

 

(d)                                 Since January 1, 2011 and through the date
of this Agreement, no material Proceeding relating to any Transferred Company
Benefit Plan has been brought by any Governmental Authority or third Person
(other than routine claims for benefits in the ordinary course) or been, to
Parent’s Knowledge, threatened.

 

(e)                                  All material contributions and payments due
or accrued under each Transferred Company Benefit Plan, determined in accordance
with applicable Legal Requirements and GAAP and prior funding and accrual
practices as of June 30, 2013, have been timely and fully discharged and paid or
reflected as a liability on the Balance Sheet.

 

(f)                                   Each Benefit Plan intended to be
tax-qualified under Section 401(a) of the Code has received a favorable and
up-to-date determination letter from the IRS as to its tax-qualified status
under the Code and, to Parent’s Knowledge, there are no existing circumstances
likely to result in the revocation of any such determination letter or
disqualification of any such Benefit Plan.

 

(g)                                  Schedule 2.12(g) of the Disclosure Letter
sets forth a true, correct, and complete list as of the date of this Agreement
of each Benefit Plan that is subject to Title IV of ERISA (other than a
Multiemployer Plan).  As to each such Benefit Plan, as of the date of this
Agreement, (i) there has been no event or condition that presents a significant
risk of plan termination; (ii) there has been no failure to satisfy the minimum
funding standards, whether or not waived, imposed by Section 302 of ERISA or
Section 412 of the Code; (iii) no reportable event within the meaning of
Section 4043 of ERISA (for which the disclosure requirements of Reg. § 4043.1 et
seq., promulgated by the PBGC, have not been waived) has occurred within the
past six (6) years; and (iv) no liability (including liability pursuant to
Section 4069 of ERISA but excluding premiums to the PBGC due but not yet
delinquent) under Title IV of ERISA has been or is reasonably expected to be
incurred by the Transferred Companies.

 

(h)                                 Schedule 2.12(h) of the Disclosure Letter
sets forth a true, correct, and complete list as of the date of this Agreement
of each Benefit Plan that is a Multiemployer Plan. With respect to each such
Multiemployer Plan as of the date of this Agreement, (i) within the past six
(6) years, none of the Transferred Companies or their respective ERISA
Affiliates has made or suffered a “complete withdrawal” or a “partial
withdrawal,” as such terms are respectively defined in Sections 4203 and 4205 of
ERISA; (ii) no event has occurred that presents a material risk of a complete or
partial withdrawal; (iii) none of the Transferred Companies has any contingent
liability under Section 4204 or 4212(c) of ERISA; and (iv) within the past six
(6) years, none of the Transferred Companies nor any of their respective ERISA
Affiliates has received any notification that any such plan is in reorganization
(within the meaning of Section 4241 of ERISA), has been terminated, is insolvent
(within the meaning of Section 4245 of ERISA) or is in endangered or critical
status (within the meaning of Section 437 of the Code or Section 305 of ERISA).

 

(i)                                     Schedule 2.12(i)(i) of the Disclosure
Letter sets forth a true, correct and complete list as of the date of this
Agreement of each Transferred Company Benefit Plan that

 

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provides for post-retirement health, medical, life insurance or other welfare
benefits for any Relevant Employee (other than any Transferred Company Benefit
Plan that provides for such benefits solely to avoid excise Taxes pursuant to
Section 4980B of the Code or to satisfy applicable Legal Requirements). 
Schedule 2.12(i)(ii) of the Disclosure Letter sets forth all understandings,
agreements or undertakings, written or oral, that would prevent any such
Transferred Company Benefit Plan from being amended or terminated with respect
to benefits provided by such Transferred Company Benefit Plan without material
liability to the Transferred Companies on or at any time after the Closing Date,
except, in each case, as required by applicable Legal Requirements or by
Collective Bargaining Agreements.

 

(j)                                    Except as otherwise agreed in this
Agreement, neither the execution and delivery of this Agreement nor the
consummation of the transactions contemplated hereby (either alone or in
conjunction with any other event) will (i) entitle any Business Employee of the
Transferred Companies (other than the U.S. Transferred Companies and Viance) to
terminate their employment or engagement, (ii) entitle any Relevant Employee to
any severance, separation, change of control, termination, bonus, retention or
other additional compensation or benefits; or (iii) cause or result in the
accelerated vesting, funding or delivery of, or increase the amount or value of,
any compensation or benefit to any Relevant Employee.  Without limiting the
generality of the foregoing, no amount, economic benefit or other entitlement
that could be received (whether in cash or property or the vesting of property)
as a result of any of the transactions contemplated hereby (alone or in
combination with any other event) by any Relevant Employee would be
characterized as an “excess parachute payment” (as defined in
Section 280G(b)(1) of the Code).  No Transferred Company Benefit Plan provides
for any gross-up payment associated with any Tax.

 

(k)                                 To the Knowledge of Parent, since January 1,
2011 and through the date of this Agreement, each Transferred Company Benefit
Plan covering any current or former employees of any of the German Companies and
German-Controlled Entities or of any of their Subsidiaries (collectively,
“German Transferred Benefit Plans”) is in compliance in all materials respects
with all applicable Legal Requirements and Collective Bargaining Agreements and
has been administered in all materials respects in accordance with its terms. 
All material obligations under or in connection with any pension or pension
scheme (including obligations arising by operation of Legal Requirements or
Collective Bargaining Agreements) that have become due have been fulfilled by
the German Companies or their Affiliates.  All future obligations under or in
connection with any German Transferred Benefit Plan, including obligations
arising by operation of Legal Requirements and Collective Bargaining Agreements,
appertaining to periods until the date of this Agreement are, to the extent
applicable, funded according to Legal Requirements and based on the most recent
actuarial date.  For periods until the Closing Date, all obligations under or in
connection with any German Transferred Benefit Plan have been adjusted as and
when required by Sec. 16 German Company Pensions Act (BetrAVG) or, where
applicable, any contractual provisions.  As of the date of this Agreement, no
Business Employee has made or, to the Knowledge of Parent, threatened any
material claim or Proceeding in respect of any German Transferred Benefit Plan
and no event has occurred which could or might give rise to any such claim or
Proceeding.

 

(l)                                     Except as would not reasonably be
expected to be, individually or in the aggregate, material to the Business, none
of the Transferred Companies have, to the Knowledge

 

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of Parent, been issued a restoration order, contribution notice or a financial
support direction under Sections 38, 43 or 52 of the Pensions Act 2004 and, to
the Knowledge of Parent, there are no circumstances that are reasonably expected
to lead to any such order, notice or direction being issued.  No debt from a
Transferred Company has become due under Section 75 Pensions Act 1995 and no
such debt will become due from any Transferred Company as a consequence of the
transactions contemplated by this Agreement, other than debt due from Rockwood
Pigments (U.K.) Limited to the U.K. Retirement Plan.

 

(m)                             Except as would not be reasonably expected to
be, individually or in the aggregate, material to the Business, and except as
disclosed on the Balance Sheet or set forth on Schedule 2.12(m) of the
Disclosure Letter (i) as of the date hereof, none of the Transferred Companies
have been issued with an Order, notice or direction on underfunding in relation
to Sachtleben Pigments Oy Pension Fund which remains outstanding on the date of
this Agreement; (ii) Sachtleben Pigments Oy Pension Fund has not, as of the date
hereof, been placed in liquidation due to underfunding under the Finnish
Pensions Fund Act (1774/1995 as amended); and (iii) to the Parent’s Knowledge,
since January 1, 2011 and through the date of this Agreement, there is no
material Proceedings brought by any Governmental Authority or Business Employee
or a pensioner entitled to benefits from the Sachtleben Pigments Oy Pension Fund
(other than routine claims for benefits) pending or threatened against
Sachtleben Pigments Oy Pension Fund which are likely to result in a material
liability of Sachtleben Pigments Oy.

 

(n)                                 All amounts (including the Trattamento di
fine rapporto or any other severance indemnity) due by the Italian Company to
its direct employees have been duly paid or reserved in the Financial Statements
in all material respects in accordance with applicable Legal Requirements.  To
the Knowledge of Parent, no persons other than those individuals who are
specifically classed as direct employees of the Italian Company shall be
entitled to be recognized as such.  As of the date of this Agreement, the
Italian Company has in all material respects carried out all filings and taken
all actions required to be made or taken, under applicable Legal Requirements in
connection with its direct employees (including, the Legal Requirements
governing the social security system).

 

2.13                        Transactions with Affiliates; Enterprise Agreements.

 

(a)                                 As of the date of this Agreement, there are
no (i) Contracts (other than intercompany purchase orders or Enterprise
Agreements) between any of the Transferred Companies or Non-Controlled
Companies, on the one hand, and Parent or any of its Affiliates (other than the
Transferred Companies), on the other hand, in effect as of the date of this
Agreement or (ii) other material transactions in effect as of the date of this
Agreement between any of the Transferred Companies or Non-Controlled Companies,
on the one hand, and Parent or any of its Affiliates (other than the Transferred
Companies), on the other hand.

 

(b)                                 Schedule 2.13(b) of the Disclosure Letter
sets forth a list of all control agreements, profit and loss transfer agreements
or other enterprise agreements within the meaning of Sections 291 and 292 of the
German Stock Corporation Act of 1965 (Aktiengesetz) (the “AktG”) to which the
German Companies are a party (collectively, the “Enterprise Agreements”).

 

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2.14                        Environmental Matters.

 

(a)                                 The Transferred Companies, the Business and
the Real Property are, since the date that is three (3) years prior to the date
of this Agreement, in all material respects in compliance with all Environmental
Requirements;

 

(b)                                 Since the date that is three (3) years prior
to the date of this Agreement, the Transferred Companies have not received
(i) any written notice or written request for information from any Governmental
Authority or other Person with respect to any material discharge, release into
the Environment, disposal or removal of any Hazardous Substance; or (ii) any
written notice that any Transferred Company has been or may be identified in any
Proceeding as a responsible party or a potentially responsible party for any
material liability under Environmental Requirements which remains outstanding
and unresolved.  To the Knowledge of Parent, no such notice or request has been
threatened;

 

(c)                                  The Transferred Companies hold, and are in
all material respects in compliance with, all material Permits required under
Environmental Requirements for the Transferred Companies to conduct the Business
in all material respects in the manner it is conducted on the date of this
Agreement.  All such material Permits are in full force and effect, and no event
has occurred and is continuing which requires, or after notice or lapse of time
or both would require, any modification, revocation, non-renewal or termination
of any such Permit;

 

(d)                                 None of the Transferred Companies have
entered into any material written agreements or undertakings with any Person
relating to any Remedial Action or other liability imposed or incurred under
Environmental Requirements in respect of the Business or the Real Property that
remain in effect as of the date of this Agreement (except that the Leases,
Business Agreements and Permits may contain indemnities and/or agreements
regarding such liabilities);

 

(e)                                  There are no underground storage tanks
located on the Real Property, and no asbestos, asbestos-containing materials,
polychlorinated biphenyls (PCBs) or PCB wastes are now located, contained, used
or stored by the Transferred Companies in or at the Real Property (including the
buildings, structures and all improvements and machinery and equipment thereon
or thereat);

 

(f)                                   The Transferred Companies have made
available for review by Buyer all reports, studies, correspondence and other
documents of a material nature that are in the possession or control of Parent
or the Transferred Companies, have been generated or received since the date
that is three (3) years prior to the date of this Agreement and that address
material or potentially material liabilities of the Transferred Companies, the
Business or the Real Property pursuant to Environmental Requirements;

 

(g)                                  There is no material Proceeding pending or,
to the Knowledge of Parent, threatened against any Transferred Company or any
Business Assets before or by any Governmental Authority pursuant to
Environmental Requirements or relating to any Environmental Condition, and no
Transferred Company is subject to any material Order of any

 

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Governmental Authority pursuant to Environmental Requirements or relating to any
Environmental Condition; and

 

(h)                                 This Section 2.14 contains the exclusive
representations and warranties of Parent concerning (i) compliance by the
Transferred Companies and the Business with Environmental Requirements;
(ii) liabilities of the Transferred Companies and the Business under
Environmental Requirements; and (iii) liabilities of the Transferred Companies
and the Business in respect of contamination of real or personal property with
Hazardous Substances or pollution.  For the avoidance of doubt, none of the
representations in this Section 2.14 shall be deemed to be made with respect to
any of the Non-Operating Sites or any activities or business conducted thereon.

 

2.15                        Intellectual Property.

 

(a)                                 Schedule 2.15(a)(i) of the Disclosure Letter
sets forth a list of all Intellectual Property used primarily or held for use
primarily in the conduct of the Business that is or has been registered or
issued or is the subject of a pending application for registration or issuance
as of the date of this Agreement in the name of or owned by Parent or any of its
Affiliates (including the Transferred Companies) (collectively, “Registered
Intellectual Property”).  The Transferred Companies exclusively own all
Registered Intellectual Property, free and clear of all Encumbrances other than
Permitted Encumbrances.  All Registered Intellectual Property is valid and
subsisting and each Transferred Company owns or has the right to use, free and
clear of all Encumbrances other than Permitted Encumbrances, all of the
Intellectual Property used or held for use in its respective Business as
currently conducted and all of the Intellectual Property to be used at the
Augusta Facility as currently contemplated.

 

(b)                                 No Transferred Company is on the date of
this Agreement, or has been during the two (2) years preceding the date of this
Agreement, a party to or the subject of any infringement, misappropriation,
interference, opposition or similar Proceeding challenging the right or title to
or use by such Transferred Company of any Intellectual Property; and (ii) no
such Proceeding has, to the Knowledge of Parent, been threatened during such two
(2) year period.

 

(c)                                  Except as would not reasonably be expected,
individually or in the aggregate, to be material to the Business, the conduct by
the Transferred Companies of the Business on the date of this Agreement does not
infringe on or misappropriate any Intellectual Property of any other Person. 
Neither Parent nor any of the Transferred Companies is aware of any third party
Intellectual Property which the contemplated operations of the Augusta Facility
would infringe or misappropriate.  Prior to the date of this Agreement, neither
Parent nor any of the Transferred Companies has received any written notice from
any other Person alleging that any Transferred Company has infringed any
Intellectual Property of any other Person, which claim has not been resolved.

 

(d)                                 Except as otherwise set forth in
Section 4.6(a) immediately following the Closing, the Transferred Companies
shall own, or by license or otherwise have the right to use, all material
Intellectual Property used in the conduct of the Business in the manner in which
it is conducted on the date of this Agreement.

 

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(e)                                  Each Transferred Company has taken
reasonable measures to ensure that all of its employees, contractors and agents
involved in the conception, development, authoring, creation, or reduction to
practice of any Intellectual Property for such Transferred Company (i) have
executed Contracts that assign such Intellectual Property that such Transferred
Company does not already own by operation of law to such Transferred Company and
(ii) have executed confidentiality Contracts with, or, in the case of employees
only, are otherwise bound by duties of confidentiality to, a Transferred Company
regarding the protection and use of all confidential and proprietary information
provided by or on behalf of a Transferred Company to, or generated by, such
employee, contractor or agent.  To the Knowledge of Parent, there have been no
unauthorized disclosures of trade secrets, proprietary information and know-how
of any Transferred Company by any of Transferred Company’s employees,
contractors or agents.

 

(f)                                   Except for the Administrative Assets or
Administrative Services utilized by the Parent and its Affiliates (other than
the Transferred Companies) primarily for the benefit of the Parent, Parent and
its Affiliates (other than the Transferred Companies) do not own, and do not
have any license or right to use, any Intellectual Property used primarily in
the Business or currently contemplated to be used at the Augusta Facility upon
completion of its construction.

 

(g)                                  Except for the IT Systems set forth on
Schedule 2.15(g) of the Disclosure Letter, each Transferred Company owns, leases
or licenses all IT Systems with an aggregate replacement value in excess of
$100,000 that are necessary for the conduct of such Transferred Company’s
portion of the Business.

 

2.16                        Permits; Subsidies.

 

(a)                                 The Transferred Companies hold, and are in
all material respects in compliance with, all material Permits (other than
Permits required under Environmental Requirements, which are addressed in
Section 2.14) required to conduct the Business in all material respects in the
manner in which it is conducted as of the date of this Agreement.  All such
material Permits are in full force and effect, and no event, default or
violation has occurred and is continuing which permits, or after notice or lapse
of time or both would permit, any modification, revocation, non-renewal or
termination of any such Permit.  No Proceeding is pending or, to the Knowledge
of Parent, threatened to revoke, withdraw, suspend, cancel, terminate or
materially modify or limit any such Permit.

 

(b)                                 The Business is being conducted, and since
at least January 1, 2011 has been conducted, in all material respects in
compliance with all Legal Requirements relating to state aid and governmental
subsidies.  Any such state aid and subsidy granted to the Transferred Companies
will remain in full force and effect and will be available for use on
substantially the same terms and conditions as previously enjoyed and will not
have to be repaid as a result of the consummation of the transactions
contemplated by this Agreement.

 

2.17                        Compliance with Foreign Corrupt Practices Act.

 

(a)                                 Since July 1, 2008, no Transferred Company
or, to the Knowledge of Parent, no director, officer, employee or other Person
acting for or on behalf of a Transferred Company has:

 

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(i)                                     violated any provision of the U.S.
Foreign Corrupt Practices Act of 1977, as amended, the United Kingdom Bribery
Act 2010 or any other anti-bribery or anti-corruption Legal Requirement
applicable to the Business and each Transferred Company, whether as a result of
the jurisdictions of the Transferred Company’s operations or organization
(collectively, the “Applicable Anti-Corruption Laws”); or

 

(ii)                                  to the Knowledge of Parent, included any
fraudulent entry on its books and records.

 

(b)                                 Since July 1, 2008, the Transferred
Companies have not received any written notice from any Governmental Authority
that any Transferred Company or any director, officer, employee or other Person
acting for or on behalf of a Transferred Company has violated or allegedly
violated any Applicable Anti-Corruption Laws.

 

2.18                        Compliance with Trade Laws.

 

(a)                                 Since July 1, 2008, none of the Transferred
Companies or, to the Knowledge of Parent, any director, officer or employee of
any Transferred Company, has violated in any material respects any Legal
Requirements administered by (i) the Bureau of Industry and Security of the
Department of Commerce or the Directorate of Defense Trade Controls of the U.S.
Department of State pertaining to export controls; (ii) the U.S. Department of
the Treasury Office of Foreign Assets Control pertaining to economic and trade
sanctions; (iii) the U.S. Department of Commerce or the IRS pertaining to
anti-boycott; (iv) the Bureau of Customs and Border Protection of the U.S.
Department of Homeland Security pertaining to importations; or (v) the Census
Bureau of the U.S. Department of Commerce pertaining to export and import
reporting (the Legal Requirements in this Section 2.18 collectively, the
“Applicable Trade Laws”).

 

(b)                                 Since July 1, 2008, the Transferred
Companies have not received any written notice from any Governmental Authority
that any Transferred Company or any director, officer, employee or other Person
acting for or on behalf of a Transferred Company has violated or allegedly
violated any Applicable Trade Laws.

 

2.19                        Brokers.  Except for Lazard Frères & Co. LLC, whose
fees and expenses will be paid by Parent or one of its Affiliates (other than
the Transferred Companies), no broker, finder or investment banker is entitled
to any brokerage, finder’s or other fee or commission in connection with this
Agreement, the Ancillary Documents or the transactions contemplated hereby or
thereby based upon any Contract entered into by or on behalf of Parent or any of
its Affiliates (including the Transferred Companies).

 

2.20                        Insurance.  All material assets and risks of the
Transferred Companies are covered by valid insurance policies in such types and
amounts and covering such risks as are consistent with customary practices and
standards of companies engaged in businesses and operations and with an
ownership structure similar to that of the Business, taken as a whole.  All such
insurance policies are in full force and effect and all premiums due and payable
thereon have been paid in full.  As of the date of this Agreement, no written
notice has been received by Parent or any of the Transferred Companies that
would reasonably be expected to be followed by a written notice

 

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of cancellation, alteration of coverage or non-renewal of any such insurance
policy.  No current or former insurance carrier of Parent or its Affiliates has
refused to renew coverage with respect to the Business since January 1, 2011.

 

2.21                        Customers and Suppliers.

 

(a)                                 Schedule 2.21(a) of the Disclosure Letter
lists the names of the ten (10) largest customers of each of the five segments
of the Business (as described in clauses (i) though (v) of the definition of
“Business”) measured by the actual Dollar value to the Business for each of the
twelve (12) months ended December 31, 2011 (only for the segment described in
clause (iii) of the definition of “Business”) and December 31, 2012, and sets
forth opposite the name of each customer the amount of sales by the Business to
such customer during such period.  As of the date of this Agreement, no such
customer (i) is engaged in any material dispute or Proceeding related to the
Business; (ii) has threatened in writing to terminate, cancel or adversely
modify the relationship of such customer with the Business; or (iii) has
threatened in writing to decrease its purchases from the Business.

 

(b)                                 Schedule 2.21(b) of the Disclosure Letter
lists the names of the ten (10) largest suppliers of goods to each of the five
segments of the Business (as described in clauses (i) though (v) of the
definition of “Business”) measured by the actual Dollar value to the Business
for each of the twelve (12) months ended December 31, 2011 (only for the segment
described in clause (iii) of the definition of “Business”) and December 31,
2012, and sets forth opposite the name of each supplier the amount of purchases
by the Business from such supplier during such period.  As of the date of this
Agreement, no such supplier (i) is engaged in any material dispute or Proceeding
related to the Business; (ii) has threatened in writing to terminate, cancel or
adversely modify the relationship of such supplier with the Business; or
(iii) has threatened in writing to decrease its services or supplies to the
Business,

 

2.22                        Product Liabilities and Warranties.

 

(a)                                 As of the date of this Agreement, the
Business has no outstanding product warranty claim with respect to its products
in excess of $150,000 individually and no outstanding product warranty
obligations outside of any customer Contracts entered into in the ordinary
course of business consistent with past practice, other than those arising by
operation of Legal Requirements or in the ordinary course of business consistent
with past practice.

 

(b)                                 Since January 1, 2011, no Person has
asserted or threatened in writing, or to the Knowledge of Parent, otherwise
threatened in writing to assert, any claim or Proceeding with respect to product
safety, defects, deficiencies, negligence or liability with respect to any
products manufactured, produced, distributed or sold by the Business or any
services performed by the Business.

 

2.23                        Credit Support.  All bonds, letters of credit,
guarantees (whether payment or performance), security and other credit support
of Parent or any of its Affiliates (including the Transferred Companies) with
respect to the Business (the “Credit Support”)  as of the date of this Agreement
are set forth on Schedule 2.23 of the Disclosure Letter.

 

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2.24                        Viance.  RandH has validly waived its rights under
Sections 6.2 and 6.3 of the Viance LLC Agreement in connection with the transfer
of CSI to Buyer as contemplated by this Agreement.

 

2.25                        No Other Business.  Other than the Business as
currently conducted, none of the Transferred Companies currently conduct any
other business, operation or activity, except as is incidental to the Business
conducted by such Transferred Companies.

 

ARTICLE III

 

REPRESENTATIONS AND WARRANTIES OF BUYER

 

Buyer hereby represents and warrants to Parent as follows:

 

3.1                               Incorporation of Buyer.  Buyer is a limited
liability company, duly formed, validly existing and in good standing under the
laws of the State of Delaware.

 

3.2                               Power; Authorization; Consents.

 

(a)                                 Buyer has the limited liability company
power and authority to execute, deliver and perform this Agreement and the
Ancillary Documents to be executed and delivered by Buyer and to consummate the
transactions contemplated hereby and thereby.  The execution, delivery and
performance by Buyer of this Agreement and the Ancillary Documents to be
executed and delivered by Buyer and the consummation of the transactions
contemplated hereby and thereby by Buyer have been duly authorized and approved
by the board of managers of Buyer and no other limited liability company actions
or proceedings on the part of Buyer or the Equityholders of Buyer are necessary
to authorize and approve this Agreement or the Ancillary Documents to be
executed and delivered by Buyer and the transactions contemplated hereby and
thereby.  This Agreement has been duly executed and delivered by Buyer, and the
Ancillary Documents to be executed and delivered by Buyer at the Closing will be
duly executed and so delivered by Buyer.  This Agreement constitutes, and at the
Closing each Ancillary Document to be executed and delivered by Buyer will
constitute, a legal, valid and binding obligation of Buyer, enforceable against
Buyer in accordance with its terms, except as such enforceability may be limited
by the Bankruptcy and Equity Exceptions.

 

(b)                                 The execution, delivery and performance by
Buyer of this Agreement and the Ancillary Documents to be executed and delivered
by Buyer, the consummation of the transactions contemplated hereby and thereby,
and compliance by Buyer hereof and thereof, do not and will not:

 

(i)                                     contravene or violate any provision of
the Governing Documents of Buyer;

 

(ii)                                  conflict with, result in a breach of any
provision of, constitute a default under, or entitle any Person (with due notice
or lapse of time or both) to terminate, cancel, accelerate, modify or call a
default with respect to, any material Contract or Order to which Buyer is a
party or to which any of its Assets is subject, except, in each case, to the
extent that it would not materially impair the ability of Buyer

 

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to consummate the transactions contemplated by this Agreement and the Ancillary
Documents to which Buyer is a party, except for amendments or refinancings of
debt instruments of Buyer and its Affiliates necessary to consummate the
Financing at or prior to the Closing;

 

(iii)                               in any material respect, violate or conflict
with any material Legal Requirements (other than Antitrust Laws) applicable to
Buyer or any of its businesses or Assets; or

 

(iv)                              require Buyer or any of its Affiliates to
obtain, secure or make any material Approval, except for compliance with and
filings under the HSR Act, the EMR and the Non-U.S. Antitrust Approvals.

 

3.3                               Litigation.  As of the date of this Agreement,
there is no Proceeding pending or, to the Knowledge of Buyer, threatened in
writing, against Buyer or any of its Affiliates that would, if adversely
determined, materially impair the ability of Buyer to consummate by the Outside
Date the transactions contemplated by this Agreement and the Ancillary Documents
to which Buyer is a party.

 

3.4                               Brokers.  Except for Merrill Lynch, Pierce,
Fenner & Smith Incorporated, no broker, finder or investment banker is entitled
to any brokerage, finder’s or other fee or commission in connection with this
Agreement, the Ancillary Documents or the transactions contemplated hereby or
thereby based upon any Contract entered into by or on behalf of Buyer or any of
its Affiliates.

 

3.5                               Investment Intent of Buyer.  Buyer has such
knowledge and experience in financial and business matters that it is capable of
evaluating the merits and risks of purchasing the Shares.  Buyer is acquiring
the Shares pursuant to this Agreement for its own account for investment
purposes only, and not with the view to or in connection with any distribution
thereof.  Buyer acknowledges and agrees that the Transferred Companies, the
Shares, the Minority Interests and the Business are being sold “as is”, except
as expressly set forth in this Agreement.  Buyer acknowledges that Parent makes
no representation or warranty with respect to (i) any projections, estimates or
budgets delivered or made available to Buyer or its Representatives of future
revenues, future results of operations (or any component thereof), future cash
flows or future financial condition (or any component thereof) of the
Transferred Companies, the Non-Controlled Companies or the Business or the
future business and operations of the Transferred Companies, the Non-Controlled
Companies or the Business; or (ii) except as expressly set forth in this
Agreement, any other information or documents made available to Buyer or its
Representatives with respect to the Transferred Companies, the Non-Controlled
Companies, the Shares, the Minority Interests or the Business.  The parties
agree that the term “made available” or “delivered” with respect to any
information or document shall mean that such information or document was, prior
to the date of this Agreement, (A) included in the electronic data room of
Parent related to the transactions contemplated by this Agreement and to which
Buyer and its Representatives were given access prior to the date of this
Agreement, (B) included in the Disclosure Letter or (C) otherwise provided to
Buyer or its Representatives in writing.

 

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3.6                               Financing.  Buyer will have at the Closing
cash on hand, lines of credit or other sources of immediately available funds to
provide, in the aggregate, sufficient funds to enable it to pay the Purchase
Price and to perform its obligations under this Agreement and the Ancillary
Documents to which it is or upon the Closing will be a party.

 

ARTICLE IV

 

COVENANTS

 

4.1                               Access; Confidentiality.

 

(a)                                 Between the date of this Agreement and the
Closing, Parent will, and will cause the Transferred Companies and Sellers to,
during normal business hours and upon reasonable prior notice, (i) provide to
Buyer and its Representatives reasonable access to the premises (including the
Leased Sites), Assets, property, books and records of the Transferred Companies
and the Business; (ii) furnish to Buyer and its Representatives financial
information, operating data and other information pertaining to the Business and
the Business Assets; (iii) make available for inspection and copying by Buyer
and its Representatives copies of any documents relating to the foregoing; and
(iv) permit Buyer and its Representatives to conduct reasonable interviews of
key employees and executive officers of the Business; provided, however, that
(A) Buyer shall exercise its right under this Section 4.1(a) in such a manner as
to not unreasonably interfere with the operation of the Business; (B) Buyer
shall not be allowed to perform invasive or subsurface investigations of any
Real Property, including any sampling, testing or removal of materials (other
than documents to the extent permitted hereunder) from the offices, factories
and properties of Parent, the other Sellers or the Transferred Companies,
without the prior consent of Parent (which consent can be withheld in Parent’s
sole discretion); and (C) Parent may limit such access described in clauses
(i) through (iv) above to the extent such access (1) would violate or give rise
to liability of Parent or its Affiliates under applicable Legal Requirements,
including any Antitrust Laws; (2) would require Parent or any of its Affiliates
to waive any attorney-client privilege; or (3) conflicts with any
confidentiality obligations to which Parent or any of its Affiliates is bound
(it being understood that Parent shall, and shall cause the Sellers and the
Transferred Companies to, cooperate in commercially reasonable efforts and
requests for waivers that would enable disclosure to Buyer to occur without so
jeopardizing privilege or contravening such Legal Requirement, privilege or
confidentiality obligation).  The representations, warranties and covenants of a
party and any Person’s right to indemnification or other remedy based upon any
representation, warranty or covenant of a party will not be affected or deemed
waived by any investigation conducted by or on behalf of such Person or by
reason of any knowledge acquired at any time with respect to the accuracy or
inaccuracy of, or compliance with, such representations, warranties or
covenants.

 

(b)                                 All information provided to Buyer and its
Representatives by or on behalf of Parent, the Sellers, the Transferred
Companies, their Affiliates or their Representatives (whether pursuant to this
Section 4.1 or otherwise) will be governed and protected by the Confidentiality
Agreement between Parent and Buyer Guarantor dated April 5, 2013 (the
“Confidentiality Agreement”).  Notwithstanding any provision of the
Confidentiality Agreement to the contrary, each of the parties hereto
acknowledges and agrees that, in consultation with Parent, unless Parent has a
reasonable objection in respect of specific Business Employees,

 

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Buyer shall be permitted to (i) enter into discussions and negotiations with up
to thirty (30) Business Employees concerning their employment with the Business
following the Closing; and (ii) enter into Contracts with each of such Business
Employees to the extent the effectiveness of such Contracts is conditioned on
the consummation of the Closing; provided that in the event this Agreement is
terminated in accordance with Article VII, Buyer agrees that, for a period of
two (2) years following the date of such termination, neither it nor any of its
Affiliates shall hire any Business Employee with whom Buyer or one of its
Affiliates had discussions with prior to the termination of this Agreement. 
Following the Closing, Buyer and its Affiliates shall be entitled to use, and
disclose, all information relating to the Business free of any restrictions, and
the parties hereto agree that the Confidentiality Agreement shall not apply to
any of the foregoing actions.

 

4.2                               Announcements; Public Disclosures.  Prior to
the Closing, no party shall, and each party shall cause its Affiliates and
Representatives not to, issue any press release or otherwise directly or
indirectly make any public statement, public announcement or other public
disclosures with respect to this Agreement or the transactions contemplated
hereby without the prior consent of the other party (which consent shall not be
unreasonably withheld, conditioned or delayed), except as may be required by
applicable Legal Requirements or the rules of any stock exchange on which their
securities (or securities of any of their Affiliates) are listed, in which case,
to the extent practicable under the circumstances, the disclosing party shall
allow the other party reasonable time to comment on such disclosure in advance
of its issuance (the disclosing party being under no obligation to accept any
such comments); provided, however, that each party may make oral or written
public announcements, releases or statements without complying with the
foregoing procedures if the substance of such announcement, release or statement
was previously publicly disclosed in accordance with the foregoing requirements.

 

4.3                               Conduct of Business Prior to the Closing.

 

(a)                                 During the period from the date of this
Agreement and continuing until the Closing, except as expressly provided for in
this Agreement or as set forth on Schedule 4.3(a) of the Disclosure Letter and
except for actions necessary to consummate the Restructuring, to the extent that
Buyer otherwise shall consent in writing (which consent shall not be
unreasonably withheld, delayed or conditioned) or as required by applicable
Legal Requirements, Parent (to the extent related to the Business) shall, and
shall cause the Sellers (to the extent related to the Business) and the
Transferred Companies to:

 

(i)                                     conduct the Business in all material
respects in the ordinary course of business consistent with past practice;

 

(ii)                                  use commercially reasonable efforts to
preserve the present business operations and organization (including Key
Employees) of the Transferred Companies;

 

(iii)                               use commercially reasonable efforts to
preserve the present relationships with Persons having material business
dealings with the Transferred Companies (including material customers and
suppliers);

 

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(iv)                              use commercially reasonable efforts to
maintain the books and records of the Transferred Companies consistent with past
practice;

 

(v)                                 manage Working Capital in the ordinary
course of business consistent with past practice, taking into account historical
fluctuations in Working Capital of the Business;

 

(vi)                              use commercially reasonable efforts to
continue to maintain insurance in respect of the Transferred Companies and the
Business Assets consistent with past practice; and

 

(vii)                           make and pay all Capital Expenditures in respect
of the Business (other than in respect of the Augusta Facility, which is
governed by Section 4.27) in accordance with the Capex Plan, except for
reasonable deviations not in excess of 10% from the Capex Plan.

 

(b)                                 Without limiting the generality of the
foregoing, during the period from the date of this Agreement and continuing
until the Closing, except as expressly provided for in this Agreement or as set
forth on Schedule 4.3(b) of the Disclosure Letter and except for actions
necessary to consummate the Restructuring, to the extent that Buyer otherwise
shall consent in writing (which consent shall not be unreasonably withheld,
delayed or conditioned) or as required by applicable Legal Requirements, Parent
(to the extent related to the Business) shall not, and shall not permit any of
the Sellers (to the extent related to the Business) or Transferred Companies to,
do any of the following:

 

(i)                                     amend any of the Governing Documents of
any Transferred Company or propose or consent to any amendments to the Governing
Documents of the Non-Controlled Companies;

 

(ii)                                  (A) issue (1) additional shares of capital
stock or other Equity Interests of any Transferred Company, or (2) any “phantom”
stock rights, stock appreciation rights, stock-based performance units,
commitments, arrangements or undertakings to which any Transferred Company is a
party or by which any of them is bound (x) obligating any Transferred Company to
issue, deliver or sell, or cause to be issued, delivered or sold, additional
Equity Interests or (y) that give any Person the right to receive any economic
or governance benefit or right similar to or derived from the economic or
governance benefits and rights accruing to holders of the Shares of the
Transferred Companies; or (B) sell, transfer, grant, or dispose of, any Shares,
any Subsidiary Shares or Minority Interests or any other Equity Interests of or
other ownership interests in, any Transferred Company;

 

(iii)                               effect any recapitalization,
reclassification, stock split, combination or like change in the capitalization
of any Transferred Company or amend the terms of any outstanding securities of
any Transferred Company or propose or consent to any recapitalization,
reclassification, stock split, combination or like change in the capitalization
of any Non-Controlled Company or amend the terms of any outstanding securities
of any Non-Controlled Company;

 

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(iv)                              acquire any Assets or sell, assign, license,
transfer, convey, lease or otherwise dispose of any Business Assets, except that
the foregoing shall not apply to any such acquisition or disposition (A) in the
ordinary course of business consistent with past practice; (B) as contemplated
by the Capex Plan or the Augusta Spending Benchmarks; or (C) involving
consideration, individually or in the aggregate, not exceeding $5.0 million;

 

(v)                                 fail to make any requisite filings,
renewals, recordings, payments, and other acts with applicable patent, trademark
and copyright offices in applicable jurisdictions to maintain and protect its
interest in the Intellectual Property or dispose of or abandon any Intellectual
Property, except where the failure to take action or disposing of or abandoning
such Intellectual Property is in the ordinary course of business.

 

(vi)                              except as pursuant to Benefit Plans or
Contracts existing as of the date of this Agreement, or as required by
applicable Legal Requirements or Collective Bargaining Agreements, (A) increase
the salary or other compensation of any Business Employee or consultant, except
for any such increases in the ordinary course of business consistent with past
practice; (B) grant any bonus, benefit direct or indirect extraordinary
compensation to any Business Employee or consultant, except for any such grants
in the ordinary course of business consistent with past practice; (C) increase
the coverage or benefits available under any (or create any new) Benefit Plan
(other than any Transferred Company Benefit Plan) other than in the ordinary
course of business consistent with past practice; or (D) enter into any
employment agreement with any Business Employee (or amend any such agreement to
which any Transferred Company is a party) other than in the ordinary course of
business consistent with past practice; or (E) plan, announce, implement or
effect any reduction in force, lay-off, early retirement program, severance
program or other program concerning the termination of employment of the
Business Employees;

 

(vii)                           adopt, terminate or amend any Transferred
Company Benefit Plan or plan that would be a Transferred Company Benefit Plan if
in effect on the date hereof other than (w) a termination, amendment or adoption
made in the ordinary course of business consistent with past practice that does
not materially increase the cost to any Transferred Company Benefit Plan, (x) as
required by Benefit Plans or Business Agreements, in each case, as in effect as
of the date of this Agreement, or any collective bargaining agreements or any
other agreements with any labor unions or works council as in effect on the date
hereof or as entered into or amended consistent with the terms of this
Agreement, or (y) as required by applicable Legal Requirements;

 

(viii)                        enter into, modify or terminate any Collective
Bargaining Agreement through negotiation or otherwise, except for (A) as set
forth on Schedule 4.3(b)(viii) of the Disclosure Letter, (B) any amendment to
the wage tariff rates under any Collective Bargaining Agreement with works
council applicable to Business Employees located in Germany represented by the
Industry Trade Union for Mining, Chemicals and Energy (the “IGBCE”) that has
been agreed to by the IGBCE and the Bundesarbeitgeberverband Chemie e.V. (BACV),
(C) any amendment that does not increase the aggregate employee costs of a site,
including termination costs, by more than

 

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2% of such costs on the date of this Agreement, and (D) amendments to other
Collective Bargaining Agreements regarding wage tariffs generally consistent
with the wage tariffs paid by chemical companies operating in the countries in
which the Business operates provided no amendment shall be for a term exceeding
twelve (12) months;

 

(ix)                              terminate the employment of any Business
Employee unless in the ordinary course of business;

 

(x)                                 hire, retain or transfer the employment of
any individual who would be a Business Employee or consultant in respect of a
Transferred Company unless in the ordinary course of business; provided,
however, that no transfer of Business Employees shall (A) increase the salary or
other compensation of any such Business Employee (except to the extent that any
such increases do not materially increase the total salary and other
compensation for such group as a whole), (B) result in the grant of any material
bonus, benefit direct or indirect extraordinary compensation to such Business
Employee, (C) result in a material increase in the coverage or benefits
available to such Business Employee under any Benefit Plan (other than any
Transferred Company Benefit Plan), or (D) enhance in any material way such
Business Employee’s rights on termination or expiration of their employment
agreements;

 

(xi)                              make any material change in any accounting
method or practice with respect to the Business, except as may be required by
relevant accounting regulatory and rule making bodies;

 

(xii)                           declare, set aside or pay any non-cash dividend
or distribution in respect of any Equity Interest of any Transferred Company, or
purchase, redeem or acquire any Equity Interest of any Transferred Company;

 

(xiii)                        subject to any Encumbrance (other than Permitted
Encumbrances) any Shares or material Business Assets, which Encumbrance shall
not be released or satisfied prior to the Closing;

 

(xiv)                       make any loan, advance or capital contribution to,
or other investment in, any other Person, except for any such investments (A) in
the ordinary course of business consistent with past practice; (B) as required
by the Augusta Spending Benchmarks or the Capex Plan; (C) to Sachtleben Pigments
Oy’s Pension Fund in accordance with applicable Legal Requirements;
(D) involving amounts, individually or in the aggregate, not exceeding $5.0
million; or (E) as required by the Governing Documents of any Transferred
Company or Non-Controlled Company;

 

(xv)                          except for Indebtedness incurred by Parent or its
Affiliates (other than the Transferred Companies), incur or assume any
Third-Party Indebtedness exceeding $5.0 million in the aggregate;

 

(xvi)                       adopt any plan of reorganization, liquidation or
dissolution, file a petition in bankruptcy or consent to the filing of a
bankruptcy petition in respect of any Transferred Company;

 

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(xvii)                    change any Transferred Company’s discount, allowance
or return policies or grant any discount, allowance or return terms for any
customer or supplier other than in the ordinary course of business;

 

(xviii)                 make or enter into any Business Agreement that would be
a Material Contract or Lease, other than any Business Agreement made or entered
into in the ordinary course of business or as contemplated by the Augusta
Spending Benchmarks or the Capex Plan; provided, however, that notwithstanding
the foregoing, no Transferred Company shall make or enter into (A) any Take or
Pay Agreement or (B) any Business Agreement that would be a Material Contract
and is not terminable by the relevant Transferred Company without penalty on
twelve (12) months’ or less notice;

 

(xix)                       terminate, restate, or in any respect, amend,
supplement or waive, any rights under any Material Contract, Lease or Permit,
except for any such amendments, supplements or waivers in the ordinary course of
business or that individually would not reasonably be expected to have an
adverse impact on the Business in excess of $2.5 million; provided, however,
that notwithstanding the foregoing, no Transferred Company shall restate, or in
any respect, amend, supplement or waive, any rights under any Take or Pay
Agreement with respect to “take or pay” or similar requirements thereunder or
the term thereof;

 

(xx)                          settle, release or compromise any pending or
threatened Proceeding or claim for an amount that would, individually or in the
aggregate, reasonably be expected to be greater than $500,000;

 

(xxi)                       enter into or agree to enter into any merger or
consolidation of any Transferred Company with any Entity, engage in any new
material line of business or invest in, make a capital contribution to, or
otherwise acquire the securities, of any other Entity;

 

(xxii)                    enter into any Contract that restrains, restricts or
limits the ability of any Transferred Company or the Business to compete with or
conduct any business or line of business in any geographic area;

 

(xxiii)                 change or modify its credit, collection or payment
policies, procedures or practices, including acceleration of collections or
receivables (whether or not past due) or fail to pay or delay payment of
payables or other liabilities, or engage in any other material discount
activity, deferred revenue activity or inventory overstocking or understocking
activity, in each case, in the ordinary course of business;

 

(xxiv)                (A) make a material change in its Tax accounting methods;
(B) change or rescind any material election in respect of Taxes, other than U.S.
federal Income Tax entity classification elections with respect to Transferred
Companies (other than U.S. Transferred Companies) consistent with Schedule
2.7(o) of the Disclosure Letter; (C) amend any material Tax Return; or
(D) settle any material claim or assessment in respect of Taxes, in each case,
which could reasonably be expected to increase the Tax

 

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liability of any Transferred Company for any taxable period beginning after the
Closing Date; or

 

(xxv)                   transfer the manufacturing or production of any titanium
dioxide product from one site to another site;

 

(xxvi)                terminate, restate, amend, supplement or waive any rights
under any of the Sachtleben Agreements or Sachtleben Guarantees; or

 

(xxvii)             authorize or agree, whether in writing or otherwise, to do
any of the foregoing.

 

Notwithstanding any provision of this Agreement, the Transferred Companies may
distribute some or all of their cash and cash equivalents to their holders of
Equity Interests and take such actions as may be required to effect the
foregoing, and at or prior to the Closing, Sellers may continue to manage the
Transferred Companies’ cash through intercompany accounts and cash management
arrangements consistent with past practices.

 

4.4                               Consents; Cooperation.

 

(a)                                 Subject to the terms and conditions hereof,
Parent and Buyer will use their respective commercially reasonable efforts (and
to the extent necessary, shall cause their Affiliates to use their respective
reasonable best efforts):

 

(i)                                     to obtain, secure or make prior to the
earlier of the date required (if so required) or the Closing Date, any Approvals
of, to or with any Governmental Authority (subject to Sections 4.5 and 4.9) that
are required for the consummation of the transactions contemplated by this
Agreement;

 

(ii)                                  to defend, consistent with applicable
Legal Requirements, any Proceeding, whether brought derivatively or on behalf of
third Persons (including Governmental Authorities, subject to Section 4.5)
challenging this Agreement or the transactions contemplated hereby;

 

(iii)                               subject to Section 4.1, to furnish to each
other such information and assistance as may reasonably be requested in
connection with the foregoing; and

 

(iv)                              to take, or cause to be taken, all action and
to do, or cause to be done, all things necessary, proper or advisable to
consummate and make effective the transactions contemplated by this Agreement
including satisfaction, but not waiver, of the closing conditions set forth in
Articles V and VI; provided, however, that this Section 4.4(a)(iv) shall not
expand any party’s obligation set forth in Sections 4.5.

 

(b)                                 Parent and Buyer shall use their respective
commercially reasonable efforts (and to the extent necessary, shall cause their
Affiliates to use their respective commercially reasonable efforts) to obtain or
secure any Consents of any third Person that are (i) set forth on Schedule
4.4(b) of the Disclosure Letter; (ii) required for the consummation of the
transactions contemplated by this Agreement; or (iii) required to avoid a breach
of or default

 

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under any Business Agreement as a result of the consummation of the transactions
contemplated by this Agreement (the “Required Consents”); provided that in
obtaining any such Required Consent, neither party shall be required to make any
payments of consideration or provide any other inducement to the other party or
parties to the Contract to which such Required Consent relates, except as
otherwise expressly required by the terms of the Contract to which such Required
Consent relates, in which case, the parties shall share equally (50/50) any such
fees required to obtain such Required Consents.

 

4.5                               Competition Filings.

 

(a)                                 Parent and Buyer shall (i) no later than
twenty-one (21) days following the execution and delivery of this Agreement,
file or cause to be filed with the United States Federal Trade Commission
(“FTC”) and the United States Department of Justice (“DOJ”) the notification and
report form required by the HSR Act for the transactions contemplated hereby,
(ii) no later than twenty-one (21) days following the execution and delivery of
this Agreement, file or provide the first draft of the required Form CO related
to notifying the transactions contemplated hereby to the European Commission
pursuant to the EMR, (iii) notify the transactions contemplated hereby under
Antitrust Laws to the applicable Governmental Authorities in respect of the
Non-U.S. Antitrust Approvals set forth on Schedule 4.5(a) of the Disclosure
Letter (the “Required Non-U.S. Antitrust Approvals”), (iv) cooperate (and shall
cause their respective Affiliates and Representatives to cooperate) in
responding to (A) any requests for information from the DOJ or FTC or, if
applicable, the information requested by any Request for Additional Information
and Documentary Material or application under the HSR Act, (B) any requests for
information from the European Commission pursuant to the EMR, or (C) any
requests for information from any Governmental Authority in connection with any
Non-U.S. Antitrust Approvals under Antitrust Laws, and (v) furnish the other
party and the other party’s counsel as promptly as practicable with all such
information and reasonable assistance as may be reasonably required in order to
effectuate the foregoing actions.  Neither Buyer nor Parent shall agree to any
extension or delay of any waiting periods or applicable suspensory periods
during which the Closing cannot occur under the HSR Act, the EMR or in respect
of any Required Non-U.S. Antitrust Approval, or otherwise withdraw its
notification and report form under either the HSR Act, the EMR or in respect of
any Required Non-U.S. Antitrust Approval, unless both Parent and Buyer have
given their prior written consent to such extension, delay or withdrawal.

 

(b)                                 Subject to the terms and conditions herein
provided, (i) Buyer and Parent shall use their reasonable best efforts (A) to
terminate any waiting periods under the HSR Act or applicable suspensory periods
during which the Closing cannot occur under any Required Non-U.S. Antitrust
Approvals, obtain from the European Commission a decision under the EMR
declaring the transactions contemplated by this Agreement compatible with the EU
Common Market, obtain any Required Non-U.S. Antitrust Approvals, and defend any
Proceeding brought by any Governmental Authority seeking to restrain or prohibit
any of the transactions contemplated by this Agreement under the U.S. Antitrust
Laws or the EMR, and (B) to vacate any Order under or related to any Antitrust
Laws that prohibits the consummation of the transactions contemplated by this
Agreement, in each case, so as to permit the transactions contemplated by this
Agreement to be consummated; and (ii) Buyer shall use its reasonable best
efforts to offer to take, or cause to be taken, all other actions and do, or
cause to be done, all other things necessary, proper or advisable to eliminate
any objection that any Governmental

 

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Authority has to the transactions contemplated by this Agreement under the U.S.
Antitrust Laws or the EMR and to consummate the transactions contemplated by
this Agreement; provided, however, that notwithstanding the foregoing, Buyer may
resist or seek to reduce the scope of any requirement proposed by any
Governmental Authority even if it delays (or is likely to delay) the Closing, to
a date not beyond the Outside Date (as the same may be extended pursuant to
Section 7.1(e)).  For purposes of this Section 4.5, “reasonable best efforts” by
Buyer shall include an obligation (x) to enter into effective as of the Closing
Date and conditioned upon the Closing a Divestiture Arrangement with a Qualified
Party (a “Divestiture Action”) and (y) to enter into a settlement, undertaking,
consent decree, stipulation or other agreement (a “Settlement”) with the FTC,
DOJ or European Commission that requires Buyer to take a Divestiture Action, in
each case with respect to clause (x) and (y), to the extent necessary to secure
Approval of the transactions contemplated hereby by any such Governmental
Authority under Antitrust Laws.  Notwithstanding any provision of this
Agreement, in no event shall Buyer or any of its Subsidiaries or Affiliates be
required to propose, offer or agree to (A) sell, transfer, divest, license, hold
separate or otherwise dispose of, or allow a third Person to utilize, any
portion of the respective businesses, assets or Contracts of Buyer, Parent, the
Business, any Transferred Company, any Non-Controlled Company or any of their
respective Affiliates, other than a Divestiture Action; or (B) take any other
action that may be required or requested by any Governmental Authority in
connection with obtaining the Approvals contemplated by this Section 4.5 other
than a Divestiture Action.

 

(c)                                  Parent and Buyer shall each cooperate with
the other party as reasonably necessary and advisable to satisfy each party’s
obligations set forth in Section 4.5(b).  Subject to applicable Legal
Requirements, the preservation of the attorney-client privilege and the
instructions of any Governmental Authority, Parent and Buyer shall each keep the
other informed of the status of matters relating to the obtaining of Approval
under any Antitrust Laws of the transactions contemplated by this Agreement,
including promptly furnishing the other with copies of notices or other
communications between Parent or Buyer, as the case may be, or any of their
respective Affiliates (with any competitively sensitive information being
provided on an external counsel basis only), and any Governmental Authority
under or related to any Antitrust Laws with respect to such transactions. 
Parent and Buyer shall permit counsel for the other party reasonable opportunity
to review in advance, and shall consider in good faith the views of the other
party in connection with any proposed written communication to any Governmental
Authority with respect to the transactions contemplated by this Agreement. 
Buyer and Parent shall obtain the consent of the other (which consent shall not
be unreasonably withheld, conditioned or delayed), if it selects or retains
outside experts or economists to assist the parties with any review or
investigation initiated by a Governmental Authority under Antitrust Laws of the
transactions contemplated by this Agreement.  Parent and Buyer each agree to not
participate in any substantive meeting or discussion, either in person or by
telephone, with any Governmental Authority in connection with the transactions
contemplated by this Agreement unless it consults with the other party in
advance and, to the extent not prohibited by such Governmental Authority, gives
the other party the opportunity to attend and participate.

 

(d)                                 Each of the parties will consult and
cooperate with the other and consider in good faith the views of the other party
in connection with any filing, analysis, presentation or argument to be made or
submitted to the FTC, DOJ, the European Commission or other Governmental
Authority relating to Antitrust Laws or Antitrust Approvals in connection with
the

 

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transactions contemplated by this Agreement. Notwithstanding anything to the
contrary in this Agreement, it is understood and agreed that Buyer shall, in
good faith and in consultation with Parent (as provided in Sections 4.5(c) and
(d)), be entitled to direct and make all final decisions in determining,
managing and implementing the strategy and timing for taking any actions and the
negotiations and communications with any Governmental Authority with respect to
any actions set forth in Section 4.5.

 

4.6                               Use of Name.

 

(a)                                 Buyer agrees that (except as expressly set
forth in this Section 4.6(a)) after the Closing neither Buyer nor its Affiliates
(including the Transferred Companies) shall have any rights in and to the mark
“Rockwood” or any trademarks, trade names, service marks, trade dress, logos,
corporate names, domain names and other source identifiers, emblems, signs or
insignia containing or comprising the foregoing, including any mark confusingly
similar thereto or derivative thereof (collectively, the “Seller Marks”), and
will not at any time after the Closing market, promote, advertise or offer for
sale any products, goods or services utilizing any of the Seller Marks or
otherwise hold itself out as having any affiliation with Parent or any of its
Affiliates.  Buyer agrees that if any of the Business Assets, including any
promotional materials or printed forms, bear the “Rockwood” name (or any
derivative thereof), Buyer shall, prior to distributing, selling or otherwise
making use of such Business Assets for the general public, remove, delete, cover
or render illegible the “Rockwood” name as it may appear on such Business
Assets.  Notwithstanding the foregoing, for a period of six (6) months after the
Closing Date, Buyer may use any remaining inventory of materials, including
business cards, stationery, packaging materials, displays, signs, promotional
materials and other similar materials that include one or more of the Seller
Marks to the extent such materials were included in the Business Assets as of
the Closing.  Buyer shall indemnify and hold harmless the Seller Indemnitees
against all Losses asserted against or imposed upon them as a consequence of the
use of the Seller Marks by Buyer and its Affiliates (including the Transferred
Companies) following the Closing.

 

(b)                                 Buyer shall, within ten (10) Business Days
after the Closing Date, make the initial filing required to be made with the
applicable Governmental Authority to cause each Transferred Company whose name
includes the name “Rockwood” to change its name such that its name does not
include the name “Rockwood” and shall use commercially reasonable efforts to
change any such name as promptly as practicable following the Closing Date.

 

(c)                                  Parent agrees that, after the Closing,
neither Parent nor its Affiliates shall (i) have any rights in and to any
trademarks, trade names, service marks, trade dress, logos, corporate names,
domain names of any of the Transferred Companies and other source identifiers,
emblems, signs or insignia related thereto or containing or comprising the
foregoing, including any mark or term confusingly similar thereto or derivative
thereof, but excluding the Seller Marks (collectively, the “Company Marks”); or
(ii) market, promote, advertise or offer for sale any products, goods or
services utilizing any of the Company Marks or otherwise hold itself out as
having any affiliation with Buyer, the Transferred Companies or any of their
Affiliates.

 

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4.7                               Notification of Certain Matters.

 

(a)                                 Between the date of this Agreement and the
Closing, (i) Parent will give prompt notice in writing to Buyer of any event,
change, effect, circumstance or development of which it has Knowledge, or of
which it receives notice, that (A) the employment of any Key Employee is
terminated or could reasonably be expected to be terminated for any reason,
whether by a Transferred Company or by such Key Employee (B) has had or could
reasonably be expected to have, individually or in the aggregate, taken together
with any other event, change, effect, circumstance or development, a Material
Adverse Effect; (C) has caused or could reasonably be expected to cause any of
Parent’s representations, warranties, covenants or agreements contained in this
Agreement to be untrue or inaccurate; or (D) has resulted, or could reasonably
be expected to result, in the failure to satisfy any one or more of the
conditions specified in Article V; and (ii) Parent will give Buyer prompt notice
upon acquiring Knowledge of the institution of or the threat of institution of
any Proceeding against Parent, any Seller, any Transferred Company or any of
their respective Affiliates related to this Agreement, any Ancillary Document,
or the transactions contemplated hereby or thereby.

 

(b)                                 Between the date of this Agreement and the
Closing, (i) Buyer will give prompt notice in writing to Parent of any event,
change, effect, circumstance or development of which it has Knowledge, or of
which it receives notice, that (A) has caused or could reasonably be expected to
cause any of Buyer’s representations, warranties, covenants or agreements
contained in this Agreement to be untrue or inaccurate; (B) has had or could be
reasonably expected to have, individually or in the aggregate, taken together
with any other event, change, effect, circumstance or development, a material
adverse effect on the ability of Buyer to consummate the transactions
contemplated by this Agreement; or (C) has resulted, or could reasonably be
expected to result, in the failure to satisfy any one or more of the condition
specified in Article VI; and (ii) Buyer will give Parent prompt notice upon
acquiring Knowledge of the institution of or the threat of institution of any
Proceeding against Buyer or any of its Affiliates related to this Agreement, any
Ancillary Document, or the transactions contemplated hereby or thereby.

 

(c)                                  The delivery of any notice pursuant to this
Section 4.7 shall not limit or otherwise affect the remedies available hereunder
to the party receiving such notice, or the representations or warranties of, the
indemnification obligations of, or the conditions to the obligations of, the
parties hereto.

 

4.8                               Retention of Books and Records.  Subject to
the terms of this Section 4.8, Buyer will retain, and cause the Transferred
Companies to retain, for a period of seven (7) years following the Closing Date,
all material financial and tax-related books, records and other documents
pertaining to the Business in existence on the Closing Date and in possession of
the Transferred Companies as of the Closing Date and to make the same available
after the Closing Date for examination and copying by Parent or its
Representatives, at Parent’s expense, upon reasonable notice and for a
reasonable purpose.  Buyer agrees that no such books, records or documents will
be destroyed by Buyer or its Affiliates (including the Transferred Companies)
until the later of (i) seven (7) years following the Closing Date, (ii) the
expiration of the statute of limitations for the assessment of Taxes in the
jurisdiction to which such books, records and documents relate and (iii) any
time period for retention provided by Legal Requirements.

 

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4.9                               Permits.  Buyer shall be responsible for
effecting all updates and amendments and reissuances of Permits required in
connection with or as a result of the transactions contemplated hereby.  Parent
will, and will cause its Affiliates to, cooperate, with Buyer in effecting such
updates, amendments and reissuances.

 

4.10                        Intercompany Agreements.  As of the Closing, all
Business Agreements and transactions between Parent and its Affiliates (other
than the Transferred Companies) on the one hand, and the Transferred Companies
on the other hand (other than the Business Agreements or other transactions
listed on Schedule 4.10 of the Disclosure Letter), will either be terminated or
amended to remove or replace the applicable Transferred Company or Affiliate of
Parent, as the case may be, as a party to such agreement, as applicable, without
further liability to Buyer and its Affiliates (including any Transferred
Company) with respect to periods following the Closing.

 

4.11                        Indebtedness.

 

(a)                                 Except as provided in Section 4.11(b), at or
prior to the Closing, Parent shall cause each Transferred Company to pay,
discharge, compromise, settle, terminate or otherwise satisfy or cause to be
paid, discharged, compromised, settled, terminated or otherwise satisfied in
full all Intercompany Indebtedness and all Third-Party Indebtedness as well as
all Encumbrances related thereto.  Parent shall obtain customary debt payoff
letters and related ancillary documents in respect of Third-Party Indebtedness,
including evidence of the release of all Encumbrances related thereto and
evidence that notice of such repayment or release has been timely delivered to
the holders of such Third-Party Indebtedness. Notwithstanding the foregoing,
Parent may cause Third-Party Indebtedness to remain outstanding up to an
aggregate amount of $16.0 million.

 

(b)                                 Notwithstanding Section 4.11(a):

 

(i)                                     with respect to any Intercompany
Indebtedness owed by a Transferred Company to Parent or an Affiliate of Parent
(other than another Transferred Company), if requested by Buyer in the manner
described below, Parent shall cause such Intercompany Indebtedness to remain
outstanding if Buyer agrees to purchase such Intercompany Indebtedness at face
value at Closing (it being understood that the total Purchase Price for the
Shares and Intercompany Indebtedness shall be the same as the Purchase Price for
the Shares would have been if the Intercompany Indebtedness were not purchased
by Buyer).

 

(ii)                                  with respect to any Intercompany
Indebtedness owed by a Transferred Company to another Transferred Company, if
requested by Buyer in the manner described below, Parent shall cause such
Intercompany Indebtedness to remain outstanding (it being understood that such
Intercompany Indebtedness shall not reduce the Purchase Price).

 

Within sixty (60) days after the date of this Agreement, Parent shall provide
Buyer with a schedule of Intercompany Indebtedness, and within 45 days after
receipt thereof (but in no event less than 10 Business Days before the Closing
Date), Buyer shall provide Parent with a schedule identifying any Intercompany
Indebtedness that it requests remain outstanding (“Identified

 

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Indebtedness”).  Following the initial identification pursuant to the preceding
sentence, Parent shall use commercially reasonable efforts to inform Buyer of
any new Intercompany Indebtedness and any changes to any existing Identified
Indebtedness and provide Buyer with an opportunity not later than twenty-one
(21) days prior to the Closing Date to add any new Intercompany Indebtedness to,
or remove any previously Identified Indebtedness from, its schedule of
Identified Indebtedness.  Buyer shall be required to make any such additions at
least ten (10) Business Days prior to the Closing Date.

 

4.12                        Credit Support.

 

(a)                                 During the period from the date of this
Agreement and continuing until the Closing, except to the extent Buyer consents
in writing (which consent shall not be unreasonably withheld, conditioned or
delayed), Parent and its Affiliates (other than the Transferred Companies) shall
not provide any Credit Support to the Business, except for (i) replacements of
Credit Support existing on the date of this Agreement or extensions of the term
thereof, (ii) Credit Support required to be provided under Legal Requirements,
(iii) Credit Support required to be provided pursuant to Business Agreements or
Credit Support existing on the date of this Agreement, (iv) unsecured Credit
Support for an amount, individually or in the aggregate, not exceeding $10.0
million, or (v) any Sec. 303 AktG Security.

 

(b)                                 No later than ten (10) Business Days prior
to the Closing Date, Parent shall provide Buyer with an updated Schedule 2.23 of
the Disclosure Letter that sets forth all of the Credit Support reasonably
expected to be outstanding as of the Closing Date.  Parent and its Affiliates
shall keep in effect and maintain all of the Credit Support as of the Closing
Date until the earlier of (i) the date the applicable Credit Support is released
or replaced by Buyer or (ii) the date that is the ninetieth (90th) day following
the Closing Date.  Buyer shall use its commercially reasonable efforts to
obtain, on or before the Closing Date (to the extent Parent so requests), and in
any event within ninety (90) days following the Closing Date, the release or
replacement of each of the obligations of Parent (or any Affiliate thereof,
other than the Transferred Companies) to provide Credit Support in respect of
any liability of any Transferred Company set forth on such updated Schedule 2.23
of the Disclosure Letter.  To the extent Buyer does not obtain any such release
or replacement, Buyer shall indemnify and hold harmless Parent in respect of any
liability or expense incurred by Parent (or any Affiliate thereof, other than
the Transferred Companies) in respect of any claim made in respect of any such
liability or expense arising or incurred after the Closing Date.  To the extent
any creditor of any Transferred Company requests that Parent or any of its
Affiliates grant any Credit Support under Section 303 of the AktG for any
liabilities or obligations of any such Transferred Company (other than in
respect of Parent Covered Losses (as defined in Schedule 8.9 of the Disclosure
Letter)) to such creditor, which Credit Support will remain in effect following
the Closing (a “Sec. 303 AktG Security”), Buyer shall use commercially
reasonable efforts to provide such Sec. 303 AktG Security effective as of the
Closing as requested by such creditor and have such creditor simultaneously
release Parent or any of its Affiliates from its obligation to provide such Sec.
303 AktG Security (“Security Replacement”). In the event Buyer cannot obtain
such Security Replacement within thirty (30) days after the Parent of any of its
Affiliates has given written notice to Buyer of any security request, Parent or
its respective Affiliate shall be entitled but not obliged to grant such Sec.
303 AktG Security and Buyer shall hold harmless and indemnify Parent or the
relevant Affiliate from any payment made pursuant to any such Sec. 303 AktG
Security.

 

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4.13                        Title Insurance.  Prior to Closing, upon request of
Buyer, Parent shall reasonably cooperate with Buyer in any efforts of Buyer to
obtain title insurance in respect of the Owned Real Property.  Such cooperation
will include the execution of such instruments reasonably requested to enable
Buyer to obtain such insurance and desired endorsements; provided, however, that
Parent and its Affiliates (other than the Transferred Companies) shall not be
required to execute any instrument which expands in any way the representations
and warranties contained herein or the liabilities of Parent hereunder (for
purposes of this Agreement, any instrument executed by the Transferred Companies
pursuant to this Section 4.13 shall be deemed to have been executed and
delivered following the Closing).  The premiums for any such title insurance
will be Buyer’s responsibility.

 

4.14                        Restructurings; Augusta Related Activities.

 

(a)                                 Parent shall cause the Restructurings to be
consummated in accordance with Schedule A-2 of the Disclosure Letter and shall
use commercially reasonable efforts to consummate the Restructurings prior to
the date the Closing would otherwise be required to occur pursuant to this
Agreement without giving effect to the conditions to the consummation of the
Closing set forth in Section 5.5.  All liabilities, including, for the avoidance
of doubt, any and all Taxes, in connection with the Restructurings shall be
Parent’s responsibility.  For the avoidance of doubt, as part of the
Restructurings, Parent shall cause its Affiliates (i) to transfer the ownership
of all Business Assets located at the Leased Sites to the Transferred Companies
(or, upon Buyer’s reasonable request, at Closing to Buyer or its designated
Affiliates); and (ii) exclude the Retained Sites and the Retained Companies from
the Assets of the Transferred Companies.

 

(b)                                 Parent shall use its commercially reasonable
efforts to continue with the Augusta Related Activities that would be taken by a
reasonable and prudent operator that has not entered into an agreement to sell
the Business.  Except for any liabilities included in the final determination of
Closing Working Capital, all liabilities, including, for the avoidance of doubt,
any and all Taxes, payable prior to Closing (or in the case of Taxes, incurred
prior to the Closing) in connection with the Augusta Related Activities shall be
Parent’s responsibility.

 

4.15                        Restrictive Covenants.

 

(a)                                 Parent agrees, to the maximum extent not
violative of applicable Legal Requirements, that for a period of three (3) years
following the Closing Date, Parent shall not, and shall cause its Affiliates not
to, directly or indirectly, solicit for employment or hire any Business Employee
who is or has been employed by any of the Transferred Companies, at, or at any
time within one (1) year prior to, the time of the act of solicitation;
provided, however, that (i) general solicitations, such as through newspaper
advertisements, not directed at any Business Employees, will not be deemed to
violate this Section 4.15(a); and (ii) this Section 4.15(a) shall not apply to
any Business Employee whose employment with Buyer or any of its Affiliates,
including the Transferred Companies, is terminated by Buyer or any of its
Affiliates.

 

(b)                                 Parent agrees, to the maximum extent not
violative of applicable Legal Requirements, that for a period of three (3) years
following the Closing Date, Parent shall not, and shall cause its Affiliates not
to, engage in the Business in any country (the “Restricted

 

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Territory”) in which the Business conducts operations as of the Closing Date
(the “Restricted Business”); provided, however, that nothing herein shall be
construed to prevent Parent or its Affiliates from (i) acquiring or owning,
directly or indirectly, for investment purposes only, less than 5% of
outstanding equity securities issued by any Person which Person (A) is publicly
traded or listed on any stock exchange or automated quotation system and
(B) engages, directly or indirectly, in the Restricted Business in the
Restricted Territory; (ii) acquiring any Entity or business that, directly or
indirectly, engages in the Restricted Business in the Restricted Territory if
less than 10% of the aggregate net revenue derived from the Business in the most
recent complete fiscal year of such acquired Entity or business (calculated on a
consolidated basis) was attributable to the Restricted Business in the
Restricted Territory; (iii) conducting any business conducted by them on the
date of this Agreement (other than those conducted through the Transferred
Companies); or (iv) performing their obligations under this Agreement or any
Ancillary Document.  In the event Parent acquires, to the extent permitted by
clause (ii) above, an Entity or business that, directly or indirectly, engages
in the Restricted Business in the Restricted Territory, Parent will use, or will
cause its applicable Affiliate to use, its commercially reasonable efforts to
dispose of such portion of such Entity or business to the extent that it engages
in the Restricted Business in the Restricted Territory within twelve (12) months
of the consummation of such acquisition by Parent or such Affiliate.  For a
period of three (3) years following the Closing Date, Parent will, and will
cause its Affiliates to, refrain from making, causing to be made, any public
statement or announcement that disparages the Business or any director of a
Transferred Company or any Key Employee; provided, however, that the foregoing
shall not prevent the making of any factual statement as required by any Legal
Requirement, any valid Order of a court of competent jurisdiction or any
Proceeding.

 

(c)                                  Notwithstanding anything herein to the
contrary, the restrictions set forth in Sections 4.15(a) and 4.15(b) will apply
only to Parent Guarantor, Parent and Entities “controlled by” (as such term is
defined in the definition of the term “Affiliate”) Parent Guarantor or Parent,
and shall not apply to any third Person or the Affiliates of such third Person
(other than Parent and any Entities “controlled” by Parent Guarantor) that
acquires Parent or any Entities “controlled” by Parent Guarantor, whether as a
result of a merger, consolidation, other business combination, or acquisition of
all or substantially all of its assets or business.

 

(d)                                 Parent acknowledges and agrees that the
covenants set forth in this Section 4.15 are reasonable in geographical and
temporal scope and in all other respects.  The covenants contained in this
Section 4.15 relate to matters which are of a special, unique and extraordinary
character, and any violation of these covenants would cause substantial and
irreparable injury to Buyer, the amount of which would be impossible to estimate
or determine and which cannot be adequately compensated.  Parent acknowledges
that Buyer would not have entered into this Agreement without Parent’s
commitment in binding itself and its Affiliates to these covenants.  Therefore,
in the event of a breach or a threatened breach by Parent or any of its
Affiliates of these covenants, Buyer will be entitled to an injunction
restraining Parent or such Affiliate from such breach or threatened breach
without the necessity of proving the inadequacy as a remedy of money damages;
provided, however, that the right to injunctive relief will not be construed as
prohibiting Buyer from pursuing or obtaining any other available remedies,
whether at law or in equity, for such breach or threatened breach.  The
injunctive relief provided for in this Section 4.15(d) is in addition to the
relief provided for in Section 10.9.

 

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(e)                                  If any court determines that any provision
(or part thereof) included in this Section 4.15 is unenforceable, such court
will have the power to reduce the duration or scope of such provision (or part
thereof) or otherwise reform such provision (or part thereof) and, as the case
may be, in reduced or reformed form, such provision shall be enforceable; it is
the intention of the parties hereto that the foregoing restrictions shall not be
terminated, but shall be deemed amended to the extent required to render them
valid and enforceable, such amendment to apply only with respect to the
operation of this Agreement in the jurisdiction of the court that has made the
adjudication.

 

4.16                        Cooperation in Litigation.  Buyer and Parent shall
(and shall cause their respective Affiliates to) reasonably cooperate with each
other at the requesting party’s expense in the prosecution or defense of any
claim or Proceeding arising from or related to the transactions contemplated by
this Agreement and involving one or more third Persons.  The party requesting
such cooperation shall pay the reasonable out-of-pocket expenses incurred in
providing such cooperation (including reasonable legal fees and disbursements)
by the party providing such cooperation and by its Representatives, but shall
not be responsible for reimbursing such party or its Representatives for their
time spent in such cooperation.

 

4.17                        Assistance.

 

(a)                                 After the Closing, Buyer will (and will
cause the Transferred Companies and its other Affiliates to) reasonably assist
Parent and its Affiliates in preparing information for various Governmental
Authorities or other third Persons after the Closing to the extent that such
information relates to the transactions contemplated by this Agreement, the
Business, the Business Assets and/or the liabilities of the Business.  Such
information includes, but is not limited to, information required by Parent and
its Affiliates to (i) comply with their financial reporting requirements and
(ii) to submit any claims that would reasonably be expected to be covered under
the insurance policies of Parent or its Affiliates or their respective
self-insurance programs in respect of events, circumstances and occurrences
prior to Closing.  Parent shall reimburse Buyer for all reasonable out-of-pocket
costs and expenses (excluding internal costs) actually incurred by Buyer and its
Affiliates in connection with the compliance by Buyer with its obligations under
this Section 4.17(a).

 

(b)                                 After the Closing, Parent shall (and shall
cause its Affiliates to) reasonably assist Buyer and its Affiliates (including
the Transferred Companies) in preparing information for various Governmental
Authorities or other third Persons after the Closing to the extent that such
information relates to the transactions contemplated by this Agreement, the
Business, the Business Assets and/or the liabilities of the Business.  Such
information shall include information required by Buyer and its Affiliates
(including the Transferred Companies) to (i) comply with their financial
reporting requirements and (ii) to submit any claims that would reasonably be
expected to be covered under the insurance policies of Buyer or its Affiliates
or their respective self-insurance programs in respect of events, circumstances
and occurrences after the Closing.  Buyer shall reimburse Parent for all
reasonable out-of-pocket costs and expenses (excluding internal costs) actually
incurred by Parent and its Affiliates in connection with the compliance by
Parent with its obligations under this Section 4.17(b).

 

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4.18                        Further Assurances.  At any time after the Closing,
Parent and Buyer will, and will cause their respective Affiliates to, promptly
execute, acknowledge and deliver any other assurances or documents reasonably
requested by Buyer or Parent, as the case may be, to satisfy or in connection
with their obligations hereunder or to consummate or implement the transactions
and agreements contemplated hereby.

 

4.19                        Insurance.  From and after the Closing Date, the
Transferred Companies shall cease to be insured by Parent’s or Parent’s
Affiliates’ (other than the Transferred Companies’) insurance policies or by any
of Parent’s or Parent’s Affiliates’ (other than the Transferred Companies’)
self-insured programs.  For the avoidance of doubt, following the Closing,
Parent and its Affiliates shall retain all rights to control its insurance
policies and programs, including the right to exhaust, settle, release, commute,
buy back or otherwise resolve disputes with respect to any of its insurance
policies and programs, notwithstanding whether any such policies or programs
apply to any liabilities of Buyer or the Transferred Companies.  Prior to and
after the Closing, Parent and its Affiliates (including, prior to the Closing
Date, the Transferred Companies) shall reasonably cooperate with Buyer to assist
Buyer in obtaining replacement insurance policies for the Transferred Companies
and the Business, including any tail insurance policies.  Following the Closing
Date, Buyer shall, and shall cause the Transferred Companies to, reasonably
cooperate with respect to any claims made by Parent with respect to the Business
or the Business Assets prior to the Closing.

 

4.20                        Privileged Matters; Waiver of Conflicts.  The
parties hereto acknowledge and agree that the information relating to or arising
out of the legal advice or services that have been or will be provided prior to
the Closing Date for the benefit of both Parent or its Affiliates (other than
the Transferred Companies) and the Transferred Companies shall be subject to a
shared privilege between Parent, on the one hand, and the Transferred Companies,
on the other hand, and Parent and the Transferred Companies shall have equal
right to assert all such shared privileges in connection with privileged
information under any applicable Legal Requirements and no such shared privilege
may be waived by (a) Parent without the prior written consent of Buyer or (b) by
Buyer or any Transferred Company without the prior written consent of Parent;
provided, however, that any information relating to or arising out of any legal
advice or services provided, whether before or after the Closing Date, with
respect to any matter for which an Indemnifying Party has an indemnification
obligation hereunder, shall be subject to the sole and separate privilege of
such Indemnifying Party, and such Indemnifying Party shall be entitled to
control the assertion or waiver of all such separate privileges under any
applicable Legal Requirements in connection with any privileged information,
whether or not such information is in the possession of or under the control of
any Indemnified Party.  Buyer, on behalf of itself and its Affiliates,
including, following the Closing, the Transferred Companies, hereby agrees that,
notwithstanding any representation of the Transferred Companies by Hughes
Hubbard & Reed LLP, Willkie Farr & Gallagher LLP and Waselius & Wist prior to
the Closing, such law firms may, following the Closing, represent Parent and its
Affiliates in any matter (including with respect to Proceedings arising under or
with respect to this Agreement and the transactions contemplated hereby), and on
behalf of itself, its Affiliates and, following the Closing, the Transferred
Companies, Buyer hereby irrevocably waives any conflicts arising out of such
representation.

 

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4.21                        Post-Closing Confidentiality.  Parent shall keep
confidential, and shall cause its Affiliates and Representatives to keep
confidential, all information relating to the Business, the Transferred
Companies or the Non-Controlled Companies (“Confidential Information”), except
(a) with the prior written consent of Buyer; (b) to the extent necessary to
comply with applicable Legal Requirements, including federal securities laws,
the valid Order of a court of competent jurisdiction or any Proceeding, in which
event, to the extent permitted by such Legal Requirement, Order or Proceeding,
Parent shall notify Buyer as promptly as practicable (and, if possible, prior to
the making of such disclosure); (c) to the extent such Confidential Information
is available to the public through no fault of Parent or any Affiliate of
Parent; (d) to the extent such Confidential Information becomes available after
the Closing Date to Parent or any of its Affiliates from a third Person who is
under no confidential or fiduciary obligation to Buyer or its Affiliates with
respect to such Confidential Information; (e) to the extent Parent can
demonstrate that such Confidential Information was independently developed by
Parent or its Affiliates after the Closing Date without violating this
Section 4.21; or (f) to the extent such Confidential Information is used in the
enforcement of any of the rights of Parent or any of its Affiliates under this
Agreement or the other Ancillary Documents or in the defense of any Proceeding
brought against Parent or one of its Affiliates.  The obligations of Parent
pursuant to this Section 4.21 shall cease five (5) years following the Closing,
except that such obligations shall survive indefinitely in respect of
Confidential Information that are trade secrets, proprietary information and
know-how of the Business, the Transferred Companies or the Non-Controlled
Companies.

 

4.22                        Financing.

 

(a)                                 Prior to the Closing, Parent shall provide,
and shall cause its Affiliates to provide, and shall use its commercially
reasonable efforts to cause Parent’s and its Affiliates’ Representatives to
provide, all reasonable cooperation in connection with the arrangement of the
Financing as may be reasonably requested by Buyer and that is customary in
connection with Buyer’s efforts to obtain the Financing, including
(i) reasonable cooperation in connection with the marketing efforts reasonably
necessary for the Financing; (ii) participation by senior management of the
Transferred Companies in, and assistance with, the preparation of a reasonable
number of rating agency presentations and meetings with rating agencies;
(iii) using commercially reasonable efforts to deliver to Buyer and its
Financing Sources the Financing Information as promptly as practicable after the
date hereof; (iv) reasonable participation by senior management of the
Transferred Companies in the negotiation of the documents necessary in
connection with the Financing; (v) taking such other customary actions of
ancillary assistance as are reasonably requested by Buyer or its Financing
Sources to facilitate the satisfaction on a timely basis of Buyer’s conditions
precedent to obtaining the Financing; (vi)  using its commercially reasonable
efforts to cause its independent auditors to, cooperate with the Financing; and
(vii) if the Closing has not occurred by January 1, 2014, engaging an Auditor
and causing such Auditor to commence preparation of the audited consolidated
balance sheets and related statements of income and cash flows of the Business
for the year ended December 31, 2013; provided, however, that until the Closing
no Transferred Company shall (A) be required to pay any commitment or other
similar fee or (B) incur any other liability or obligation related to the
Financing, and no obligation of any Transferred Company under any Financing
Document shall be effective prior to the consummation of the Closing; and
provided, further, that the requested cooperation hereunder shall not require
Parent, any Seller or any Transferred Company to take any action that would
conflict with Legal Requirements or its Governing Documents, or

 

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result in the violation or breach of, or default under, any Contract to which it
is a party or the documents necessary in connection with the Financing.  The
Transferred Companies will use commercially reasonable efforts to provide to
Buyer and its Financing Sources such specific supplementary information with
respect to the Transferred Companies or the Business (subject to the limitations
set forth in the prior sentence) as may be necessary so that the Financing
Information and the Marketing Material (to the extent relating to the
Transferred Companies) is complete and correct in all material respects and does
not and will not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements contained therein, in the
light of the circumstances under which such statements are made, not misleading.

 

(b)                                 Buyer shall, and shall cause its Affiliates
to, (i) promptly upon request by Parent, reimburse Parent for all reasonable and
documented out-of-pocket costs and expenses (excluding internal costs) actually
incurred by Parent in connection with cooperation provided for in
Section 4.22(a) and (ii) indemnify and hold harmless Parent and its Affiliates
(other than the Transferred Companies) and their respective directors, officers,
employees, and agents from and against any and all Losses suffered or incurred
by them in connection with the Financing and any information utilized in
connection therewith (other than information provided by Parent). 
Notwithstanding the immediately preceding sentence, Parent shall pay for of its
all costs and expenses (including fees of the Auditor) related to the
preparation and delivery of audited consolidated balance sheets and related
statements of income and cash flows of the Business for the year ended
December 31, 2012 (such audited Financial Information being referred to as the
“2012 Carve-Out Financial Statements”).  All non-public or otherwise
confidential information regarding the Transferred Companies obtained by Buyer,
its Affiliates or Buyer’s Representatives pursuant to this Section 4.22 shall be
kept confidential in accordance with Section 4.1(b) and the terms of the
Confidentiality Agreement; provided, however, that notwithstanding
Section 4.1(b) or the terms of the Confidentiality Agreement, upon notice to
Parent, Buyer may provide such information to potential sources of capital and
to rating agencies and prospective lenders and investors during syndication of
the Financing subject to customary confidentiality arrangements with such
Persons regarding such information and on the condition that such information is
used solely for the purpose of effecting the Financing.

 

4.23                        Transition Services Agreement.  Each of the parties
hereto agrees that between the date of this Agreement and the Closing, it will
cooperate with the other party hereto to review and revise Schedule A to the
Transition Services Agreement as reasonably necessary (a) to reflect in
reasonable detail a description of services currently utilized by the
Transferred Companies in the operation of the Business and which will be
provided to the Receiving Party, including how incremental changes to a service
(such as additional users) will be addressed; (b) to identify interdependencies
of the Transition Services that may limit the manner in which Receiving Party
terminates individual services prior to the end of the Term; (c) to include any
specific advance notice requirements for a Transition Service for early
termination; and (d) to address other omissions or inclusions in the Transition
Services.  Schedule A, as amended and mutually agreed by the parties hereto to
address the foregoing issues, will be attached to the Transition Services
Agreement as Schedule A on the Closing Date.

 

4.24                        Holliday Pigments Agreement.  Following the date of
this Agreement and prior to the Closing, Parent shall use its commercially
reasonable efforts to obtain the consent to assign

 

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the Holliday Pigments Agreement to Buyer or one of its Affiliates from the
counterparties to such agreement.  In the event the Holliday Pigments Agreement
is not assigned to Buyer or one of its Affiliates at the Closing, following the
Closing and until the Holliday Pigments Agreement is assigned to Buyer or one of
its Affiliates, Parent shall, and shall cause its Affiliates to, at the cost and
expense of Buyer and its Affiliates, provide Buyer and its Affiliates, including
the Transferred Companies, the benefits under the Holliday Pigments Agreement to
which the Transferred Companies, Parent or its Affiliates are entitled,
including, at the cost and expense of Parent and its Affiliates, using its
commercially reasonable efforts to pursue any claims for indemnification
available to the Transferred Companies, Parent or its Affiliates under the
Holliday Pigments Agreement in accordance with the terms thereof.  Parent or its
Affiliates shall promptly deliver any payments, proceeds, or other benefits
received from the counterparties to the Holliday Pigments Agreement after the
Closing to which Buyer and its Affiliates, including the Transferred Companies,
are entitled.

 

4.25                        Enterprise Agreements.

 

(a)                                 Parent shall cause the Sachtleben Enterprise
Agreement and the RSG Enterprise Agreements to be terminated with effect as of
or prior to the Closing Date (the effective date of such termination, the
“Termination Date”).  Promptly following the Closing Date, and in any event,
within fifty (50) days following the Closing Date, Buyer shall cause each of the
German-Controlled Entities to prepare and complete, in cooperation with
Sachtleben GmbH in the case of Sachtleben Chemie GmbH and with Rockwood
Specialties GmbH in the case of Silo Pigmente GmbH, Rockwood Pigmente Holding
GmbH, Sachtleben Wasserchemie (Holding) GmbH, and Sachtleben Wasserchemie GmbH,
the annual financial accounts of such German-Controlled Entity for the fiscal
period commencing on January 1 of the calendar year during which the Termination
Date occurs and ending as of the Termination Date (each a “German-Controlled
Entity Profit Pooling Account”), which accounts shall be prepared in accordance
with generally accepted accounting principles in Germany as in effect on the
Termination Date and, to the extent permitted by applicable Legal Requirements,
consistent with the past practices of the applicable German-Controlled Entity,
including by applying the policies, procedures, practices and elections applied
by Parent in the preparation of the annual financial accounts of the
German-Controlled Entities prior to the Closing Date on a consistent basis.  Any
amounts included in the German-Controlled Entity Profit Pooling Account of
(i) Silo Pigmente GmbH, Rockwood Pigmente Holding GmbH and Sachtleben
Wasserchemie (Holding) GmbH as payable by Rockwood Specialties GmbH and
(ii) Sachtleben Chemie GmbH as payable by Sachtleben GmbH as of the Termination
Date under the applicable Enterprise Agreement shall be treated as a Retained
Cash Balance for purposes of determining the Purchase Price, and such amount
shall be included in the Retained Cash Balances included in the Final Closing
Statement delivered by Buyer to Parent pursuant to Section 1.5(c), and any
disputes over such amount shall be resolved pursuant to Section 1.5.  Any
amounts included in the German-Controlled Entity Profit Pooling Account of
(i) Silo Pigmente GmbH, Rockwood Pigmente Holding GmbH and Sachtleben
Wasserchemie (Holding) GmbH as payable to Rockwood Specialties GmbH and
(ii) Sachtleben Chemie GmbH as payable to Sachtleben GmbH under the applicable
Enterprise Agreement as of the Termination Date shall be treated as Transferred
Company Indebtedness for purposes of determining the Purchase Price, and such
amount shall be included in the Transferred Company Indebtedness included in the
Final Closing Statement delivered by Buyer to Parent pursuant to Section 1.5(c),
and any disputes over such amount shall be resolved

 

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pursuant to Section 1.5.  Promptly, and in any event within ten (10) Business
Days following the final determination of the Purchase Price pursuant to
Section 1.5, (i) Buyer shall cause each of the German-Controlled Entities to pay
any amounts payable by such German-Controlled Entities under the applicable
Enterprise Agreement as of the Termination Date, and (ii) Parent shall cause
Sachtleben GmbH and Rockwood Specialties GmbH to pay to each applicable
German-Controlled Entity any amounts payable to such German-Controlled Entity
under an Enterprise Agreement as of the Termination Date.

 

(b)                                 Following the Closing Date, Buyer shall not,
and shall cause its Affiliates (including the German-Controlled Entities) not
to, amend, re-file or otherwise modify the German-Controlled Entity Profit
Pooling Accounts without the prior written consent of Parent.  Upon Parent’s
reasonable request, Buyer shall, and shall cause the applicable
German-Controlled Entity to, amend the applicable German-Controlled Entity
Profit Pooling Accounts in accordance with the written instructions of Parent,
if and to the extent required in order to maintain the fiscal unity of the
German-Controlled Entities with Parent and its Affiliates in accordance with the
applicable Enterprise Agreement for any period ending on or prior to the
Termination Date.  In the event that, following the Closing Date, a Governmental
Authority of competent jurisdiction makes a determination which is not subject
to appeal that the amount of profits transferred or the losses paid, as the case
may be, under an Enterprise Agreement with respect to any period ending on or
prior to the Termination Date were not transferred or paid, as the case may be,
in accordance with the applicable Enterprise Agreement or applicable Legal
Requirements, (i) Parent will cause Sachtleben GmbH or Rockwood Specialties
GmbH, as the case may be, to pay any such amounts so determined to be payable by
Sachtleben GmbH or Rockwood Specialties GmbH, as the case may be, to the
applicable German-Controlled Entity, or (ii) Buyer shall cause the applicable
German-Controlled Entity to pay such amounts so determined to be payable by such
German-Controlled Entity to the applicable German-Controlled Entity, Rockwood
Specialties GmbH or Sachtleben GmbH, as applicable, in each case by wire
transfer of immediately available funds to a bank account designated in writing
by Parent or Buyer, as the case may be, to the other party.  Concurrently with
any payment by Sachtleben GmbH or Rockwood Specialties GmbH, as the case may be,
to a German-Controlled Entity pursuant to the previous sentence, Buyer shall pay
to Parent an amount equal to such payment and, concurrently with any payment by
a German-Controlled Entity to Sachtleben GmbH or Rockwood Specialties GmbH
pursuant to the previous sentence, Parent shall pay to Buyer an amount equal to
such payment, in each case by wire transfer of immediately available funds to a
bank account designated in writing by Parent or Buyer, as the case may be, to
the other party.

 

4.26                        Intellectual Property.

 

(a)                                 Prior to the Closing, Parent shall
reasonably cooperate with Buyer to transfer any data related to the Business to
databases of the Transferred Companies or their designees.  Prior to the
Closing, Parent shall use commercially reasonable efforts to (i) duly record any
prior transfers of Registered Intellectual Property with any and all relevant
Governmental Authorities around the world sufficient to evidence in the records
of such Governmental Authorities a chain of title showing Parent’s or its
applicable Affiliate’s sole and exclusive ownership (prior to transfer to Buyer)
of the Registered Intellectual Property, (ii) assign or transfer or cause its
Affiliates to assign or transfer to Buyer or the Transferred Companies,
effective as of the Closing, all right, title or interest in any Registered
Intellectual

 

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Property identified on Schedule 2.15(a)(i) of the Disclosure Letter that is
registered in the name of or owned by Parent or any of its Affiliates (other
than the Transferred Companies); (iii) assign or transfer or cause the
Transferred Companies to assign or transfer to Parent or any of its Affiliates
(other than the Transferred Companies), effective as of the Closing, all right,
title or interest in any Registered Intellectual Property identified on Schedule
2.15(a)(i) of the Disclosure Letter that is (A) registered in the name of or
owned by any of the Transferred Companies and (B) includes, embodies or
incorporates any Seller Marks or is not used primarily in the Business; and
(iv) reasonably cooperate with Buyer to obtain in the name of the Transferred
Companies a license or right to use the Intellectual Property identified on
Schedule 4.26(a)(iv) of the Disclosure Schedule, effective as of the Closing
Date, on substantially similar terms to those pursuant to which Parent and
Affiliates license or obtained the right to use such Intellectual Property as of
the date of this Agreement, taking into consideration the Transferred Companies’
intended use of the applicable Intellectual Property compared to the use made by
Parent and its Affiliates as of the date of this Agreement.  Parent shall bear
all reasonable costs associated with compliance with this Section 4.26; provided
that each party shall bear their own costs associated with clause (iv) of the
foregoing sentence, and Parent and its Affiliates shall have no responsibility
for any license or other fees payable by a Transferred Company following the
Closing.  Prior to the Closing Date, Parent shall deliver to Buyer a list of any
payment required to be made by a Transferred Company with the applicable patent,
trademark or copyright office within 60 days following the Closing Date to
maintain or renew any Registered Intellectual Property.

 

(b)                                 Parent, on behalf of itself and its
Affiliates, hereby grants to the Transferred Companies and any Affiliates of the
Transferred Companies (including Persons that become Affiliates of the
Transferred Companies after the Closing Date) a perpetual, non-exclusive,
irrevocable, worldwide, sublicensable, transferable, royalty-free, fully-paid up
license to use any Intellectual Property owned by Parent or any of its
Affiliates and (i) used or held for use in the conduct of the Business prior to
the Closing or (ii) assigned by a Transferred Company pursuant to
Section 4.26(a) (other than Intellectual Property that includes, embodies or
incorporates any Seller Marks).  Parent represents and warrants that it has the
authority to grant the foregoing license on behalf of its Affiliates (other than
Transferred Companies).  Except for those representations and warranties in
Section 2.15, this Section 4.26(b) and the effects of Section 4.27 and subject
to and without limiting any other terms and conditions of this Agreement,
including the provisions of Article VIII, the Intellectual Property subject to
the foregoing license is provided “as is” without representation or warranty of
any kind, whether express, implied, statutory or otherwise and neither Parent
nor any of its Affiliates (other than the Transferred Companies) shall be liable
for any losses incurred by any of the Transferred Companies in connection with
their use of such Intellectual Property or any component thereof after the
Closing.

 

4.27                        Augusta Facility.

 

(a)                                 During the period from the date of this
Agreement and continuing until the Closing, Parent shall make, and shall cause
Rockwood Pigments to make, all payments required to be made under the Augusta
Construction Agreements (except for any payments that have not been made and are
being disputed in good faith by Parent or Rockwood Pigments).  Parent shall, and
shall cause Rockwood Pigments to, use commercially reasonable efforts to ensure
that the

 

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construction of the Augusta Facility continues in accordance with the Augusta
Spending Benchmarks.

 

(b)                                 Without the consent of Buyer (which consent
shall not be unreasonably withheld, conditioned or delayed), Parent shall not
amend, modify or terminate or make any Modification under, and shall cause
Rockwood Pigments not to amend, modify or terminate or make any Modification
under, any of the Augusta Construction Agreements or waive any material rights
of Rockwood Pigments under any of the Augusta Construction Agreements.  Prior to
the Closing Parent shall, and shall cause Rockwood Pigments to, use their
commercially reasonable efforts to (i) achieve Mechanical Completion as promptly
as practical, (ii) comply with their obligations under the Augusta Construction
Agreements and (iii) enforce all rights under the Augusta Construction
Agreements.  Parent shall not, and shall cause Rockwood Pigments not to, change,
amend or modify the location, scope, purpose or scale of the Augusta Facility
without the consent of Buyer (which consent shall not be unreasonably withheld,
conditioned, or delayed).

 

(c)                                  Following the Closing and until the
Performance Test has been successfully completed, without the consent of Parent
(which consent shall not be unreasonably withheld, conditioned or delayed),
Buyer shall not amend, modify or terminate or make any Modification under, and
shall cause Rockwood Pigments not to amend, modify or terminate or make any
Modification under, any of the Augusta Construction Agreements or waive any
material rights of Rockwood Pigments under any of the Augusta Construction
Agreements in each case that could reasonably be expected to change the
specifications of Product produced by the Augusta Facility, increase the cost to
achieve Mechanical Completion or successful completion of the Performance Test. 
Following the Closing and until the Performance Test has been successfully
completed, Buyer shall, and shall cause Rockwood Pigments to, use their
commercially reasonable efforts to (i) achieve Mechanical Completion as promptly
as practical, (ii) comply with their obligations under the Augusta Construction
Agreements and (iii) enforce all rights under the Augusta Construction
Agreements.  Except as necessary to achieve successful completion of the
Performance Test, Buyer shall not, and shall cause Rockwood Pigments not to,
change, amend or modify the location, scope, purpose or scale of the Augusta
Facility without the consent of Parent (which consent shall not be unreasonably
withheld, conditioned or delayed).

 

(d)                                 To the extent Parent is required to pay the
Augusta Cost Overrun Amount or any Augusta Qualified Costs pursuant to
Section 1.6, Parent will be subrogated to any claim Buyer or its Affiliates may
have against counterparties to the Augusta Construction Agreements in respect of
such payment or will, at the request of Parent, use commercially reasonable
efforts to enforce the rights of Buyer and its Affiliates under the Augusta
Construction Agreements with respect to such claim.

 

(e)                                  Following Final Completion, Buyer shall,
and shall cause the Transferred Companies to use their commercially reasonable
efforts to, commence production of Product at the Augusta Plant for purposes of
the Test Run and to complete a Test Run as promptly as practical.  All costs and
expenses of Buyer and its Affiliates associated with running the Test Runs will
be borne by Buyer and its Affiliates.  Except for the effect of this
Section 4.27, Parent

 

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and its Affiliates make no representation or warranty, express or implied
regarding the design, capabilities, capacity or performance of the Augusta Site.

 

(f)                                   Subject to the limitations set forth in
the proviso of Section 4.1(a), Parent shall provide to Buyer and its
Representatives reasonable access to all books and records relating to the
construction and commissioning of, and commencement of production at, the
Augusta Facility.  Parent shall reasonably allow Representatives of Buyer or its
Affiliates onsite solely for purposes of monitoring the construction of the
Augusta Facility.  Buyer shall indemnify and hold Parent and its Affiliates
harmless for all Losses incurred by them as a consequence of the participation
of Representatives of Buyer in such activities, except to the extent such Losses
arise from the gross negligence or willful misconduct of Parent and its
Affiliates. Subject to the limitations of this Section 4.27(f), Parent shall
(i) give Buyer reasonable prior notice of all key meetings of Representatives of
Parent with Representatives of O’Neal Constructors and (ii) allow Buyer and its
Representatives to participate in each of such meetings.  Subject to the
limitations of this Section 4.27(f), Parent will promptly furnish Buyer with
copies of all material correspondence, design work, certifications, permitting
paperwork and written notices from Governmental Authorities regarding the
construction of the Augusta Facility, commissioning of the Augusta Facility and
preparation for and performance of the Test Run.  Representatives of Buyer shall
be given access to and permitted to communicate with representatives of O’Neal
Constructors (so long as Representatives of Parent participate in such
communications) and Parent and its Representatives (which Representatives of
Parent will be designated by Parent and include those individuals reasonably
requested by Buyer) regarding the construction of the Augusta Facility,
commissioning of the Augusta Facility and preparation for and performance of the
Test Run.  For the avoidance of doubt, no Representatives of Buyer or its
Affiliates shall be granted access to any proprietary technology of Parent and
its Affiliates prior to the Closing.  Parent shall keep Buyer fully informed as
to the status of the construction of the Augusta Facility and shall provide
promptly (and in any event within two (2) Business Days) to Buyer all written
reports received by Parent or its Affiliates from O’Neal Constructors relating
to the construction of the Augusta Facility.  Parent shall give reasonably
prompt notice in writing to Buyer of any event, change, effect, circumstance or
development of which it has Knowledge, or of which it receives notice, that
(i) the construction of the Augusta Facility could reasonably be expected to be
materially delayed or (ii) raises reasonable concerns whether the Augusta
Facility will be able to achieve successful completion of the Performance Test.

 

(g)                                  Following the Closing and until the
Performance Test has been successfully completed, (i) Buyer shall provide to
Parent and its Representatives reasonable access to all books and records
relating to the construction and commissioning of, and the commencement of
production at, the Augusta Facility; (ii) Buyer shall allow Representatives of
Parent or its Affiliates onsite at the Augusta Facility for purposes of
monitoring and observing on a reasonable basis all aspects of the construction
of the Augusta Facility, commissioning of the Augusta Facility and preparation
for the Test Run and to attend and observe (but not control) meetings with
Governmental Authorities related to the construction, permitting and
commissioning of the Augusta Facility; provided, however, that Parent shall
indemnify and hold Buyer and its Affiliates harmless for all Losses incurred by
them as a consequence of the participation of Representatives of Parent in such
activities, except to the extent such Losses arise from the gross negligence or
willful misconduct of Buyer and its Affiliates; (iii) Buyer shall (A) give
Parent reasonable prior notice of all key meetings of Representatives of Buyer
with

 

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Representatives of O’Neal Constructors and (B) allow Parent and its
Representatives to participate in each of such meetings; (iv) Buyer will
promptly furnish Parent with copies of all material correspondence, design work,
certifications, permitting paperwork and written notices from Governmental
Authorities regarding the construction of the Augusta Facility, commissioning of
the Augusta Facility and preparation for and performance of the Test Run; and
(v) Representatives of Parent shall be given access to and permitted to
communicate with representatives of O’Neal Constructors (so long as
Representatives of Buyer participate in such communications) and Buyer and its
Representatives (which Representatives of Buyer will be designated by Buyer and
include those reasonably requested by Parent) regarding the construction of the
Augusta Facility, commissioning of the Augusta Facility and preparation for and
performance of the Test Run.  For the avoidance of doubt, no Representatives of
Parent or its Affiliates shall be granted access to any proprietary technology
of Buyer and its Affiliates.  Buyer shall keep Parent fully informed as to the
status of the construction of the Augusta Facility and shall provide promptly
(and in any event within two (2) Business Days) to Parent all written reports
received by Buyer or its Affiliates from O’Neal Constructors relating to the
construction of the Augusta Facility.  Buyer shall give reasonably prompt notice
in writing to Parent of any event, change, effect, circumstance or development
of which it has Knowledge, or of which it receives notice, that (i) the
construction of the Augusta Facility could reasonably be expected to be
materially delayed or (ii) raises reasonable concerns whether the Augusta
Facility will be able to achieve successful completion of the Performance Test. 
Notwithstanding the foregoing, (A) Parent shall exercise its rights under this
Section 4.27(g) in such a manner as to not unreasonably interfere with the
operation of the Business; and (B) and Buyer may limit such access described in
this Section 4.27(g) to the extent such access (1) would violate or give rise to
liability of Buyer or its Affiliates under applicable Legal Requirements;
(2) would require Buyer or any of its Affiliates to waive any attorney-client
privilege; or (3) conflicts with any confidentiality obligations to which Buyer
or any of its Affiliates is bound (it being understood that Buyer shall, and
shall cause the Transferred Companies to, cooperate in commercially reasonable
efforts and requests for waivers that would enable disclosure to Parent to occur
without so jeopardizing privilege or contravening such Legal Requirement,
privilege or confidentiality obligation).

 

(h)                                 In determining whether Product from the Test
Run meets the specifications set forth on Schedule A-3 of the Disclosure Letter,
the Product Quality Test Methods shall be employed.  Parent’s representative
shall be entitled to observe such sample taking, to take and test parallel
samples and to receive all test results determining whether Product meets the
specifications set forth on Schedule A-3 of the Disclosure Letter.

 

(i)                                     In the event of any disputes between
Parent and Buyer regarding the terms and conditions of, and the parties
respective obligations under, Section 1.6 and this Section 4.27, including
whether (i) Mechanical Completion has occurred at the Augusta Facility,
(ii) Final Completion has occurred at the Augusta Facility, (iii) the amount of
the Augusta Construction Costs or (iv) the Augusta Facility has successfully
completed the Performance Test, Parent or Buyer, as the case may be, shall
provide written notice of such dispute to the other party, describing such
dispute in reasonable detail.  Representatives of Parent and Buyer shall
negotiate in good faith and use their commercially reasonable efforts to resolve
such dispute for a period of thirty (30) days from the date of such written
notice.  In the event Representatives of Parent and Buyer are unable to resolve
such dispute within such thirty (30) day period, either party shall

 

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have the right, following the end of such thirty (30) day period, to submit such
dispute to be resolved by arbitration administered by the American Arbitration
Association in accordance with its Construction Industry Arbitration Rules.  The
arbitration shall be commenced by written request of any party, made in
accordance with the notice provisions of this Agreement, and shall be conducted
by a single arbitrator (the “Arbitrator”) with experience in disputes of this
nature appointed in accordance with the Commercial Rules in New York, New York. 
Parent and Buyer agree that the procedure set forth in this Section 4.27(i) for
resolving disputes with respect to items referred to in the first sentence of
this Section 4.27(i) shall be the sole and exclusive method for resolving such
dispute and the judgment of the Arbitrator shall be final and binding; provided,
however, that the parties hereto agree that judgment may be entered upon the
determination of the Arbitrator in any court having jurisdiction over the party
against which such determination is to be enforced.

 

4.28                        Employee Benefits Items.

 

(a)                                 U.K. Retirement Plan.  Parent will use
commercially reasonable efforts to ensure that as of the Closing, Rockwood
Pigments (U.K.) Limited is released from any and all liabilities in relation to
the U.K. Retirement Plan. Notwithstanding the foregoing, if Rockwood Pigments
(U.K.) Limited, Buyer or any of their Affiliates following the Closing are or
may become required to pay any amount to or in respect of the U.K. Retirement
Plan (whether under section 75 or 75A of the Pensions Act 1995 or otherwise),
Parent acknowledges that the relevant provisions of Section 8.2 of this
Agreement shall apply.

 

(b)                                 Employee Census.  Parent shall use
commercially reasonable efforts to provide Buyer, at least thirty (30) days
prior to the reasonably anticipated Closing Date, with a complete and accurate
list, on an anonymized basis, of each Business Employee, and with respect to
each, his or her, (i) employing entity, (ii) principal location of employment,
(iii) job title, (iv) original hire date and service date (if different),
(v) annualized salary or regular rate of pay, (vi) bonus paid for the most
recently completed calendar year, (v) accrued and unused vacation and other paid
time off, (vi) leave status (including type of leave, duration of leave and
expected return date), and (v) details of any applicable visa or other work
permit.

 

4.29                        Lease Agreements.  Prior to the Closing Date,
effective as of the Closing, Parent and Buyer shall enter into lease agreements
(the “Lease Agreements”) in respect of the Leased Sites substantially on the
terms and conditions set forth on Schedule A-4 of the Disclosure Letter and such
other terms that are reasonable and customary for leases of such type taking
into account the terms and conditions of this Agreement, including the parties’
obligations under Article VIII.

 

4.30                        Post-Closing Assistance with Financial Statements.

 

(a)                                 After the Closing, Parent shall (and shall
cause its Affiliates to) provide Buyer and any of Buyer’s Affiliates
(collectively, the “Buyer Entities”), and any of their respective
Representatives, upon reasonable advance notice with access during normal
business hours to those Financial Records necessary for the preparation of
financial statements and other financial data relating to the Business that is
either (i) required to be included in any current or future securities law
filing by any of the Buyer Entities with the Securities and Exchange

 

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Commission or other Governmental Authority under applicable Legal Requirements,
including any reconciliation to International Financial Reporting Standards
(IFRS) deemed required or necessary by the Buyer Entities; or (ii) reasonably
required by any of the Buyer Entities to provide in connection with any offering
of any debt or equity securities by any of the Buyer Entities (collectively, the
“Required Financials”).

 

(b)                                 If requested by Buyer, Parent shall, and
shall cause its Affiliates to, (i) execute and deliver to the external
independent accounting firm that audits, reviews or assists in the preparation
of the Required Financials or such other independent accounting firm designated
by the requesting the Buyer Entity to provide such procedures (the “Audit
Firm”), such representation letters with respect to the Required Financials, in
form and substance customary for representation letters provided to external
audit firms by management of the company whose financial statements are the
subject of an audit or are the subject of a review pursuant to U.S. Public
Company Accounting Oversight Board (PCAOB) AU Section 722 (Interim Financial
Information), as may be reasonably requested by the Audit Firm (including, if
requested, representations regarding internal accounting controls and disclosure
controls); and (ii) cooperate in furnishing such other representations and
documentation as may be reasonably requested by auditors of the Required
Financials as a condition to providing auditor comfort letters to underwriters
and initial purchasers customarily furnished in connection with the offering of
any debt or equity securities by any of the Buyer Entities.  In connection with
the preparation of such representation letters, upon request of the signatory of
such representation letters, Buyer shall, and shall cause its Affiliates to,
cooperate and to cause the appropriate employees of Buyer and its Affiliates to
cooperate and provide supporting information and documents to such signatory
consistent with Parent’s past practice related to the preparation of audited
financial statements or otherwise reasonably requested by such signatory.

 

ARTICLE V

 

CONDITIONS TO THE OBLIGATIONS OF BUYER

 

The obligations of Buyer to consummate the Closing are subject to the
satisfaction at or prior to the Closing of the following conditions (each of
which may be waived in writing in whole or in part by Buyer, but which waiver
shall not adversely affect Buyer’s indemnification rights under this Agreement):

 

5.1                               Representations and Warranties; Covenants. 
The representations and warranties of Parent in this Agreement (a) contained in
Section 2.1, 2.3(a) and 2.19 shall be true and correct at and as of the Closing
Date in all material respects, (b) contained in Section 2.2 shall be true and
correct at and as of the Closing Date in all but de minimis respects and
(c) contained in the Sections of Article II of this Agreement that are not
listed in clause (a) and (b) of this Section 5.1 shall be true and correct
(disregarding for purposes of this condition any materiality or Material Adverse
Effect qualification therein) at and as of the Closing Date, with the same
effect as though made at and as of the Closing Date (or, if given as of a
specific date or time other than the Closing Date, as of such date or time),
except for such failures of the representations and warranties set forth in the
foregoing clause (c) to be true and correct as would not reasonably be expected
to have, individually or in the aggregate, a Material Adverse Effect.  Parent
shall have

 

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performed and complied in all material respects with all covenants and
agreements required by this Agreement to be performed or complied with by Parent
at or prior to the Closing.

 

5.2                               Competition Law Clearances.  All applicable
waiting periods under the HSR Act and the EMR shall have expired or been
terminated, and the Required Non-U.S. Antitrust Approvals listed on Schedule 5.2
of the Disclosure Letter shall have been obtained (and, to the extent relevant,
shall remain in full force and effect).

 

5.3                               No Order.  No Order or Legal Requirement shall
have been issued by a Governmental Authority of competent jurisdiction, and
shall remain in effect, that preliminarily or permanently restrains, enjoins or
otherwise prohibits in any material respect the consummation of the transactions
contemplated by this Agreement.

 

5.4                               Material Adverse Effect.  Between the date of
this Agreement and the Closing Date, there shall have been no events, changes,
effects, circumstances or developments that have had or could be reasonably
expected to have, individually or in the aggregate, a Material Adverse Effect.

 

5.5                               Restructurings.  The Restructurings shall have
been completed.

 

5.6                               Carve-Out Financial Statements.  The 2012
Carve-Out Financial Statements shall have been delivered by Parent to Buyer.

 

5.7                               Closing Deliverables.  Each of the items to be
delivered by Parent or Sellers at Closing pursuant to Section 1.4(a) shall have
been delivered to Buyer.

 

5.8                               Certification.  Buyer shall have received a
certificate signed by a senior executive officer of Parent, each in form and
substance reasonably satisfactory to Buyer, dated the Closing Date, to the
effect that each of the conditions set forth in Sections 5.1, 5.4 and 5.5 have
been satisfied in all respects.

 

ARTICLE VI

 

CONDITIONS TO THE OBLIGATIONS OF PARENT

 

The obligations of Parent to consummate the Closing are subject to the
satisfaction at or prior to the Closing of the following conditions (each of
which may be waived in writing in whole or in part by Parent, but which waiver
shall not adversely affect Parent’s indemnification rights under this
Agreement):

 

6.1                               Representations and Warranties; Covenants. 
Each of the representations and warranties of Buyer contained in this Agreement
shall be true and correct (disregarding for purposes of this condition any
materiality qualification therein) at and as of the Closing Date, with the same
effect as though made at and as of the Closing Date, except for such failures of
the representations and warranties to be true and correct as would not
reasonably be expected to have, individually or in the aggregate, a material
adverse effect on the ability of Buyer or its Affiliates to consummate the
transactions contemplated to be consummated by Buyer or its Affiliates
hereunder.  Buyer shall have performed and complied in all material respects
with all

 

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covenants and agreements required by this Agreement to be performed or complied
with by Buyer at or prior to the Closing.

 

6.2                               Competition Law Clearances.  All applicable
waiting periods under the HSR Act and the EMR shall have expired or been
terminated, and the Required Non-U.S. Antitrust Approvals listed on Schedule 5.2
of the Disclosure Letter shall have been obtained (and, to the extent relevant,
shall remain in full force and effect).

 

6.3                               No Order.  No Order or Legal Requirement shall
have been issued by a Governmental Authority of competent jurisdiction, and
shall remain in effect, that preliminarily or permanently restrains, enjoins or
otherwise prohibits in any material respect the consummation of the transactions
contemplated by this Agreement.

 

6.4                               Closing Deliverables.  Each of the items to be
delivered by Buyer at Closing pursuant to Section 1.4(b) shall have been
delivered to Parent.

 

6.5                               Certification.  Parent shall have received a
certificate signed by a senior executive officer of Buyer, each in form and
substance reasonably satisfactory to Parent, dated the Closing Date, to the
effect that each of the conditions set forth in Section 6.1 have been satisfied
in all respects.

 

ARTICLE VII

 

TERMINATION

 

7.1                               Termination.  This Agreement may be terminated
at any time prior to the Closing:

 

(a)                                 by mutual written consent of Buyer and
Parent;

 

(b)                                 by Buyer or Parent by giving written notice
to the other party, if there shall be in effect a final, nonappealable Order of
any Governmental Authority of competent jurisdiction or Legal Requirement
permanently restraining, enjoining or otherwise prohibiting in any material
respect the consummation of the transactions contemplated hereby; provided,
however, that the right to terminate this Agreement under this
Section 7.1(b) shall not be available to any party whose failure (or whose
Affiliate’s failure) to fulfill any covenant, agreement or other obligation
under this Agreement has been the primary cause of, or resulted in, such Order
or Legal Requirement;

 

(c)                                  by Buyer, by giving written notice to
Parent, if (i) any condition contained in Article V has become incapable of
satisfaction prior to the Outside Date (other than primarily as a result of
action or inaction by Buyer or its Affiliates in contravention of this
Agreement); or (ii) Buyer is not then in material breach of any provision of
this Agreement and there has been a breach, inaccuracy or failure to perform any
representation, warranty, covenant or agreement of Parent contained in this
Agreement and such breach, inaccuracy or failure (A) results in the failure (or
would result in a failure if it were continuing at the time of Closing) of a
condition set forth in Article V and (B) either (1) cannot be cured by the
Outside Date or (2) if capable of being cured by the Outside Date, has not been
cured within sixty (60) days following receipt of written notice from Buyer
thereof;

 

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(d)                                 by Parent, by giving written notice to
Buyer, if (i) any condition contained in Article VI has become incapable of
satisfaction prior to the Outside Date (other than primarily as a result of
action or inaction by Parent or its Affiliates in contravention of this
Agreement); or (ii) Parent is not then in material breach of any provision of
this Agreement and there has been a breach, inaccuracy or failure to perform any
warranty, covenant or agreement of Buyer contained in this Agreement and such
breach, inaccuracy or failure (A) results in the failure (or would result in a
failure if it were continuing at the time of Closing) of a condition set forth
in Article VI and (B) either (1) cannot be cured by the Outside Date or (2) if
capable of being cured by the Outside Date, has not been cured within sixty (60)
days following receipt of written notice from Parent thereof; or

 

(e)                                  by Buyer or Parent by giving written notice
to the other party, on or after the date that is nine (9) months after the date
of this Agreement (as may be extended in accordance with the proviso below, the
“Outside Date”), if the Closing has not occurred (other than primarily as a
result of action or inaction in contravention of this Agreement by the party
seeking to terminate this Agreement or its Affiliates) in contravention of this
Agreement; provided, however, that the Outside Date may be extended by either
Parent or Buyer one or more times to a date no later than the date that is
twelve (12) months after the date of this Agreement in the event the Closing has
not occurred on or before the Outside Date and any of the conditions set forth
in Sections 5.2, 5.3, 6.2 or 6.3 has not been satisfied (except, that with
respect to Sections 5.3 and 6.3, solely to the extent the relevant Order is
based on a Proceeding brought by a Governmental Authority under U.S. or EU
Antitrust Laws or with respect to any Required Non-U.S. Antitrust Approval
listed on Schedule 5.2 of the Disclosure Letter (other than primarily as a
result of action or inaction in contravention of this Agreement by the party
seeking to terminate this Agreement or its Affiliates)).

 

7.2                               Effect of Termination.  Upon termination of
this Agreement in accordance with Section 7.1 hereof, except for the obligations
contained in Section 4.1(b), this Section 7.2, Section 9.1(h) and Article X and
the representations and warranties contained in Sections 2.19 and 3.4, which
will survive any termination of this Agreement, this Agreement will become null
and void, and no party hereto or any of their respective Representatives or
their respective holders of Equity Interests or the Financing Sources shall have
any liability hereunder or with respect hereto, except that nothing contained
herein shall relieve any party from liability for any breach or inaccuracy of
any of representation or warranty where the party making such representation or
warranty had Knowledge of such breach or inaccuracy at the time at which such
representation or warranty is made, any failure to comply with any covenant or
agreement contained herein or in the case of any fraud.

 

ARTICLE VIII

 

SURVIVAL AND INDEMNIFICATION

 

8.1                               Survival.  The representations and warranties
contained in or made pursuant to this Agreement will survive the Closing, but
will terminate on, and be of no further force after, the date that is the
eighteen (18) month anniversary of the Closing Date; provided, however, that
(a) the representations and warranties set forth in Sections 2.1, 2.2, 2.3,
2.5(b), 2.19 and 2.24 (the “Specified Representations”) and Sections 3.1, 3.2
and 3.4 shall survive the Closing indefinitely;

 

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(b) each representation and warranty set forth in Section 2.7 shall, subject to
Section 9.1(l), survive the Closing, but shall terminate on, and be of no
further effect after, the date that is sixty (60) days after the expiration of
the statute of limitation applicable to the matter to which such representation
or warranty relates; (c) each representation and warranty set forth in
Section 2.12 shall survive the Closing, but shall terminate on, and be of no
further effect after, the date that is the second anniversary of the Closing
Date; and (d) each representation and warranty set forth in Section 2.14 shall
survive the Closing, but shall terminate on, and be of no further effect after,
the date that is the fourth anniversary of the Closing; provided, further,
however, that all such representations, warranties and rights of indemnification
shall survive until any claim in respect thereof is finally resolved to the
extent a claim for indemnification or other claim based upon, resulting from or
arising out of a breach or inaccuracy of such a representation and warranty is
made with reasonable specificity in accordance with this Article VIII prior to
such date.  All other provisions of this Agreement will survive the Closing
indefinitely.

 

8.2                               Indemnification Obligations of Parent.  If the
Closing shall occur, Parent, subject to the limitations set forth in this
Article VIII, will indemnify, defend and hold harmless Buyer and its Affiliates
(including the Transferred Companies) and each of their respective
Representatives (collectively, the “Buyer Indemnitees”), on a Net After-Tax
Basis, against and in respect of any and all Losses which may be incurred by
Buyer Indemnitees based upon, resulting from or arising out of:

 

(a)                                 any inaccuracy or breach of any
representation or warranty made by Parent in this Agreement as if made on and as
of the Closing Date, except for representations and warranties that speak as of
a specific date or time other than the Closing Date (which shall be made for
this purpose on and as of such date or time); provided, however, that any
inaccuracy or breach of any representation or warranty shall be determined
without regard to and as if all qualifications as to materiality, Material
Adverse Effect or other similar qualifications as to materiality contained in or
applicable to such representation or warranty were deleted therefrom, except for
any such qualifications contained in Sections 2.6(a)(ii), 2.10(a)(xvi),
2.10(a)(xx), 2.11(c), 2.12(a), 2.13(a)(ii) and 4.3(b) (to the extent
incorporated into Section 2.6(b)), which qualifications shall not be disregarded
for any such purposes;

 

(b)                                 any breach by Parent of or failure by Parent
to perform any of its covenants or agreements contained in this Agreement;

 

(c)                                  any Indebtedness of the Transferred
Companies as of the Closing Date other than Transferred Company Indebtedness
reflected in the Purchase Price Adjustments;

 

(d)                                 the Retained Liabilities;

 

(e)                                  the Restructurings;

 

(f)                                   any Off-Site Environmental Matter;

 

(g)                                  any Pre-Closing Environmental Condition
related to the Acquired Sites;

 

(h)                                 subject to compliance by Buyer and its
Affiliates, including the Transferred Companies, with the Back-to-Back
Obligations, any Back-to-Back Amounts;

 

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(i)                                     the U.K. Retirement Plan;

 

(j)                                    all Company Transaction Expenses;

 

(k)                                 the Transaction Bonuses; and

 

(l)                                     any Parent Covered Losses.

 

8.3                               Indemnification Obligations of Buyer.  If the
Closing shall occur, Buyer, subject to the limitations set forth in this
Article VIII, will indemnify Parent and its Affiliates and each of their
respective Representatives (collectively, the “Seller Indemnitees”), on a Net
After-Tax Basis, against and in respect of any and all Losses which may be
incurred by Seller Indemnitees based upon, resulting from or arising out of:

 

(a)                                 any inaccuracy or breach of any
representation or warranty made by Buyer in this Agreement as if made on and as
of the Closing Date, except for representations and warranties that speak as of
a specific date or time other than the Closing Date (which shall be made for
this purpose on and as of such date or time); provided, however, that any
inaccuracy or breach of any representation or warranty shall be determined
without regard to and as if all qualifications as to materiality, Material
Adverse Effect or similar qualifiers contained in or applicable to such
representation or warranty were deleted therefrom;

 

(b)                                 any breach by Buyer of or failure by Buyer
to perform any of its covenants or agreements contained in this Agreement;

 

(c)                                  other than with respect to any Parent
Covered Losses, any actual payments or granting of Credit Support by RSGG and
Sachtleben GmbH to satisfy claims of creditors in connection with collateral
granted by RSGG or Sachtleben GmbH, as applicable, under Section 303 of the AktG
to the extent such claims arise after the Closing; and

 

(d)                                 any Buyer Covered Losses.

 

8.4                               Limitations on Indemnification. 
Notwithstanding anything to the contrary in this Agreement:

 

(a)                                 (i) the aggregate liability of each of
Parent and Buyer pursuant to Section 8.2 or Section 8.3, as the case may be,
shall not exceed the Base Purchase Price, except that the foregoing limitation
shall not apply to Parent’s obligations under Section 8.2(d), (e) and (g) or
Buyer’s obligations under Section 8.3(c); (ii) the aggregate liability of Parent
or Buyer pursuant to Sections 8.2(a), or 8.3(a), as the case may be (other than
in respect of any inaccuracy or breach of the Specified Representations), shall
not exceed, as to each party, an amount equal to 30% of the Purchase Price;
(iii) the aggregate liability of Parent pursuant to Section 8.2(g) shall not
exceed an amount equal to 30% of the Base Purchase Price, and (iv) the liability
of Parent and Buyer pursuant to Sections 8.2(l)8.3(c) and 8.3(d), as the case
may be, shall be as set forth in Section 8.9; provided, however, that the
limitations in clauses (i), (ii) and (iii) shall not apply to any fraud or
Willful Breach.

 

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(b)                                 no Indemnified Party will be entitled to
recover Remote Damages pursuant to Sections 8.2 or 8.3, except to the extent
that Remote Damages are awarded in the case of fraud or to the extent such
damages are actually paid by the Indemnified Party to a third Person pursuant to
a final, non-appealable Order or settlement in any Third-Party Claim, in which
case such Remote Damages paid to such third Person shall be considered Losses
for which recovery may be sought in accordance with the terms of this Agreement;

 

(c)                                  no claim for indemnification may be made
(i) by a Buyer Indemnitee pursuant to Section 8.2(a) or by a Seller Indemnitee
pursuant to Section 8.3(a) unless written notice of such claim (describing the
facts or events giving rise to such claim with reasonable specificity to the
extent of the knowledge of the noticing party) has been given to the party from
whom indemnification is sought (the “Indemnifying Party”) during the relevant
survival period set forth in Section 8.1 (which will be the survival period of
the representation and warranty alleged to have been breached); or (ii) by a
Buyer Indemnitee pursuant to Section 8.2(g) unless written notice of such claim
(describing the facts or events giving rise to such claim with reasonable
specificity to the extent of the knowledge of the noticing party) has been given
to Parent prior to the seventh (7th) anniversary of the Closing Date;

 

(d)                                 Parent shall have no liability pursuant to
Section 8.2(a): (i) for any Losses with respect to an individual matter or
series of related matters until the cumulative aggregate amount of the Losses
with respect to such matter or series of related matters arising out of the same
facts or circumstances exceeds U.S.$175,000 (the “Threshold Amount”), in which
case the amount of all such Losses (including those that are less than the
Threshold Amount) shall be included for purposes of computing the Losses that
are indemnifiable hereunder and/or applicable against the Basket Amount pursuant
to clause (ii) below; and (ii) until the aggregate amount of the Losses of the
Buyer Indemnitees for which indemnification would otherwise be available under
Section 8.2(a) exceeds 0.75% of the Base Purchase Price (the “Basket Amount”),
after which Parent will be obligated to indemnify for only that portion of such
Losses of the Buyer Indemnitees that exceed the Basket Amount; provided,
however, that the limitations on liability set forth in this clause (d) shall
not apply to Losses incurred by a Buyer Indemnitee by reason of any inaccuracy
or breach of a Specified Representation.

 

(e)                                  Parent shall have no liability pursuant to
Section 8.2(g) until the aggregate amount of the Losses of the Buyer Indemnitees
for which indemnification would otherwise be available under
Section 8.2(g) exceeds 1.0% of the Base Purchase Price (the “Environmental
Deductible”), after which Parent will be obligated to indemnify Buyer Indemnitee
for only Sellers’ Portion of such Losses of the Buyer Indemnitees that exceed
the Environmental Deductible; provided, however, that the limitations on
liability set forth in this clause (e) shall not apply to Losses incurred by a
Buyer Indemnitee by reason of any inaccuracy or breach of the representations
and warranties set forth in Section 2.14.

 

(f)                                   Parent shall have no liability pursuant to
Section 8.2 for any Loss to the extent a specific identified reserve with
respect to such Loss is reflected in the Purchase Price Adjustments for Closing
Working Capital or Transferred Company Indebtedness or reflected on Schedule
8.4(f) of the Disclosure Letter.

 

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(g)                                  Notwithstanding any other provision of this
Agreement, Parent’s obligations under Section 8.2(a) in respect of any asserted
breach or inaccuracy of the representations and warranties set forth in
Section 2.14 related to a Remedial Action shall be limited to the amount of the
least stringent, lowest cost approach to Remedial Action that is allowed under
Environmental Requirements or by the relevant Governmental Authority, that in
either case is consistent with continued prudent operation of the relevant
facility and generally accepted industry practices and that is reasonably
available.

 

(h)                                 Parent shall have no liability under
Section 8.2(d) with respect to the Leased Sites for Losses to the extent
occurring as a result of or triggered by (i) the closure, decommissioning or
demolition after the Closing of any part of any facility or structure of any
Transferred Company, other than as required under a Lease Agreement; or
(ii) under Section 8.2 to the extent occurring as a result of or triggered by
any sampling, monitoring, testing, or surface or subsurface investigation
conducted after the Closing that is not expressly required pursuant to an
Environmental Requirement of any Governmental Authority (except where the
Governmental Authority has requested such Remedial Action by reason of a request
initiated by Buyer or its Representatives).  Notwithstanding the foregoing,
Buyer shall be permitted to conduct any routine maintenance of any existing
facility or structure on the Leased Sites without affecting the liability of
Parent under Section 8.2(d) with respect to the Leased Sites.

 

(i)                                     Parent shall have no liability under
Section 8.2(g) for Losses to the extent occurring as a result of or triggered by
(i) the closure, decommissioning or demolition after the Closing of any part of
any facility or structure of any Transferred Company; or (ii) under Section 8.2
to the extent occurring as a result of or triggered by any sampling, monitoring,
testing, or surface or subsurface investigation conducted after the Closing that
is not expressly required pursuant to an Environmental Requirement of any
Governmental Authority (except where the Governmental Authority has requested
such Remedial Action by reason of a request initiated by Buyer or
Representatives).  Notwithstanding the foregoing, Buyer shall be permitted to
conduct the following activities without affecting the liability of Parent under
Section 8.2(g):  (A) any routine maintenance of any existing facility or
structure; (B) any demolition of any portion of any existing facility or
structure and related utilities down to ground surface (but not below ground
surface unless necessary to properly isolate the underground structure from the
operating portions of the facility); and (C) any construction of new facilities
or modification of any existing facility or structure but not environmental
sampling facilities other than sampling that would be performed by a reasonable
and prudent operator acting without the benefit of indemnification; provided,
however, that, in each case (1) Buyer shall provide written notice to Parent at
least thirty (30) days prior to such activity with information sufficient to
enable Parent reasonably to evaluate the extent and nature of the contemplated
disturbance of the property; (2) Parent shall have thirty (30) days in which to
provide Buyer with comments and suggestions on the activity; and (3) Buyer shall
take into account and, where commercially reasonable, accommodate Parent’s
comments and suggestions regarding the activity.

 

(j)                                    For purposes of Section 8.2(g), Losses
shall not include (i) any Losses arising primarily from any change to a
non-industrial use of the Real Property by Buyer after the Closing; (ii) any
Loss resulting primarily from any increase in, worsening of or other adverse
change in any Environmental Condition that arises from any act or omission
attributable to Buyer or any Transferred Company (and their Representatives)
following the Closing; and (iii)

 

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any expense related to management or employee time (whether opportunity costs,
direct costs or otherwise).

 

(k)                                 For purposes of Section 8.2(d) with respect
to the Leased Sites, Losses shall not include (i) any Losses arising primarily
from any change in use of the Real Property by Buyer after the Closing
(including an increase in capacity of the facilities or structures thereon)
other than as required under a Lease Agreement; (ii) any Loss resulting
primarily from any increase in, worsening of or other adverse change in any
Environmental Condition that arises from any act or omission attributable to
Buyer or any Transferred Company (or their Representatives) following the
Closing; (iii) any Loss resulting from any Environmental Condition caused or
created by Buyer or its Representatives, or that arises from Buyer’s operation
of the Business or a change in Legal Requirements applicable thereto (except as
it relates to Pre-Closing Environmental Conditions), in each case, during the
term of the applicable Lease Agreement; and (iv) any cost and expense related to
Buyer’s management or employee time (whether opportunity costs, direct costs or
expenses, or otherwise).

 

(l)                                     Buyer and Parent shall each take, and
shall cause their respective Affiliates to take, all reasonable measures
consistent with the safe and prudent operation of the applicable property to
mitigate any Loss for which indemnification may be sought hereunder promptly
upon a responsible officer or employee of an Indemnified Party or its Affiliates
becoming aware of such Loss, and neither Buyer nor Parent shall be liable for
any Loss to the extent the Indemnified Party or its Affiliates could have
mitigated such Loss by taking measures consistent with the safe and prudent
operation of the applicable property after a responsible officer or employee of
such Indemnified Party or its Affiliates becomes aware thereof.

 

(m)                             The Seller Indemnitees shall have no recourse
against any Transferred Company, their Affiliates or their respective
Representatives, assigns or successors for any indemnification claim asserted by
a Buyer Indemnitee.

 

8.5                               Recovery from Third Persons.  The amount of
any Loss for which indemnification is provided under this Article VIII (before
giving effect to the other limitations on indemnification set forth in this
Article VIII) shall be net of any amounts actually recovered by the Indemnified
Party (or any Affiliate thereof) under insurance policies, or otherwise actually
recovered by the Indemnified Party (or any Affiliate thereof) from other Persons
not affiliated with the Indemnified Party (in each case, net of any costs,
expenses or Taxes incurred for the recovery of such amounts with respect to such
Loss.  Buyer and Parent each agree that, unless the other party shall otherwise
direct in writing, it will (and cause its Affiliates to) use commercially
reasonable efforts to recover, without instituting any Proceeding, any such
amounts to the extent such recoveries would reduce amounts required to be paid
by the other party pursuant to this Article VIII.

 

8.6                               Procedure.

 

(a)                                 Any claim for indemnification under
Section 8.2 or Section 8.3 will be made in accordance with this Section 8.6.  In
the case of any claim for indemnification arising from a claim or demand of a
third Person (a “Third-Party Claim”), the Indemnified Party will give prompt
written notice, and in any event no more than fifteen (15) Business Days
following

 

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such Indemnified Party’s receipt of written notice of such Third-Party Claim, to
the Indemnifying Party describing with reasonable specificity to the extent
known the basis of such Third-Party Claim as to which it may request
indemnification hereunder and must be made to the extent it is made under
Sections 8.2(a), 8.2(g) or 8.3(a) in accordance with Section 8.4(c); provided,
however, that the failure to notify or delay in notifying an Indemnifying Party
as provided in this sentence or the next sentence will not relieve the
Indemnifying Party of its obligations pursuant to Sections 8.2 or 8.3, as
applicable, except to the extent that such failure causes material harm to the
Indemnifying Party.  Any claim for indemnification that does not result from a
Third-Party Claim will be made by written notice thereof to the Indemnifying
Party as promptly as practicable after the time the Indemnified Party becomes
aware of the facts forming the basis of such claim, which notice (i) will
describe the facts or events giving rise to such claim with reasonable
specificity to the extent known, and (ii) must be made to the extent it is made
under Sections 8.2(a), 8.2(g) or 8.3(a) in accordance with Section 8.4(c).  The
Indemnifying Party will have the right, at its sole expense, to defend and to
direct the defense against, and to manage and settle, any Third-Party Claim, in
its name or in the name of the Indemnified Party, with counsel or other
Representatives selected by the Indemnifying Party (such counsel to be
reasonably satisfactory to the Indemnified Party); provided, however, that the
Indemnifying Party may not assume the defense if (A) the Losses that may be
incurred as a result of such Third-Party Claim could reasonably be expected to
exceed the liability limitations set forth in Section 8.4(a), individually or
together with all outstanding Third-Party Claim and other claims by the
Indemnified Party under this Article VIII; (B) such Third-Party Claim seeks
injunctive or other equitable relief against the Indemnified Party; or (C) such
Third-Party Claim would reasonably be expected to materially and adversely
affect Buyer’s ongoing or future business, other than in the case of any
Third-Party Claim pursuant to Sections 8.2(d) and 8.2(e). .  If the Indemnifying
Party elects to defend against, negotiate, settle or otherwise deal with any
Third-Party Claim, it shall within fifteen (15) Business Days (or sooner, if the
nature of the Third-Party Claim so requires) notify the Indemnified Party of its
intent to do so.  If the Indemnifying Party elects not to defend against,
negotiate or settle any Third-Party Claim, fails to notify the Indemnified Party
of its election as herein provided, the Indemnified Party may defend against,
negotiate, settle or otherwise deal with such Third-Party Claim.  If the
Indemnified Party defends, negotiates or settles any Third-Party Claim, then the
Indemnifying Party shall reimburse the Indemnified Party from time to time for
the costs and expenses in connection therewith upon submission of invoices.  The
Indemnifying Party may not settle or compromise any such Third-Party Claim
without the prior written consent of the Indemnified Party (which consent shall
not be unreasonably withheld, delayed or conditioned) if as a result thereof
injunctive or other equitable relief would be imposed against the Indemnified
Party.  The Indemnified Party will cooperate with the Indemnifying Party and
make available its officers and employees and relevant files and records (and
those of its Affiliates), and the Indemnifying Party agrees to promptly provide
the Indemnified Party with such information as to the defense of any such
Third-Party Claim as the Indemnified Party shall reasonably request.  The
Indemnified Party will have the right to participate in (but not control) the
defense of any Third-Party Claim with counsel of its choice employed by it at
the expense of the Indemnified Party and will have the right, but not the
obligation, to assert any and all cross-claims and counterclaims it may have;
provided, however, that such Indemnified Party shall be entitled to separate
counsel at the expense of the Indemnifying Party if (i) so requested by the
Indemnifying Party to participate or (ii) in the reasonable opinion of counsel
to the Indemnified Party, a conflict exists between the

 

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Indemnified Party and the Indemnifying Party that would make such separate
representation advisable.  In the event the Indemnifying Party elects not to
defend against, negotiate or settle any Third-Party Claim, fails to notify the
Indemnified Party of its election as herein provided or fails to defend, contest
or otherwise protect against the imposition of any such damages as to any such
Third-Party Claim, the Indemnified Party shall have the right, but not the
obligation, to defend, contest or assert any cross-claim or counterclaim or
otherwise protect against such Third-Party Claim and may make any compromise or
settlement thereof and recover from and be indemnified by the Indemnifying Party
for the entire reasonable cost thereof, including reasonable fees and
disbursements of counsel; provided, however, that (1)  the Indemnifying Party
will have no indemnification obligations with respect to any such Third-Party
Claim or demand which is settled by the Indemnified Party without the prior
written consent of the Indemnifying Party (which consent shall not be
unreasonably withheld, delayed or conditioned); and (2) the Indemnifying Party
shall not be required to pay for more than one such counsel in each affected
jurisdiction for all Indemnified Parties in connection with any Third-Party
Claim.

 

(b)                                 Notwithstanding anything in this Section 8.6
to the contrary, neither the Indemnifying Party nor the Indemnified Party shall,
without the prior written consent of the other party, settle or compromise any
Third-Party Claim or permit a default or consent to entry of any Order unless
the Third-Party Claim claimant provides to such other party an unqualified
release from all liability in respect of the subject matter of the Third-Party
Claim.

 

(c)                                  In the event any Proceeding is brought in
respect of this Agreement or any of the Ancillary Documents, the prevailing
party will be entitled to recover reasonable expenses and fees and disbursements
of counsel and other costs incurred in such Proceeding, in addition to any
relief to which such party may be entitled.

 

8.7                               Further Limitations on Indemnification.

 

(a)                                 Following the Closing, except with respect
(i) to matters covered by Section 1.5, Section 1.6 and Section 4.27 and
(ii) breaches of the representations and warranties set forth in Sections 10.15
and 10.16, in each case, the rights of the parties under Section 4.15(d), this
Article VIII, Article IX and Section 10.9 will be the exclusive remedy of the
parties with respect to any claims (other than claims arising from fraud) a
party may have against the other party or such other party’s Affiliates or
Representatives or the Financing Sources under, relating to or in connection
with this Agreement and the transactions contemplated hereby.  Nothing in this
Section 8.7 shall limit or modify any rights of either party to seek or obtain
specific performance or specific enforcement of, or other injunctive or
equitable relief in respect of, any provision of this Agreement, or to seek any
remedy on account of any Person’s fraudulent conduct.

 

(b)                                 Buyer, on behalf of itself and its
Affiliates (including, from and after the Closing, the Transferred Companies)
and its and their respective Representatives, effective upon Closing, to the
maximum extent permitted by applicable Legal Requirements, hereby waives and
releases Parent and its Affiliates (other than the Transferred Companies) and
its and their respective Representatives from any statutory or other rights of
contribution or indemnity (except as set forth in Section 1.5, Section 1.6, this
Article VIII, Article IX and Section 10.9 and claims and causes of action
arising from fraud and claims or causes of action with respect to any breach

 

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of any covenant or agreement to be performed after the Closing) with respect to
Parent’s ownership of the Shares, the Subsidiary Shares, the Minority Interests
or control or operation of, or otherwise relating to, the Transferred Companies
and the Business; provided, however, that Buyer is not releasing any claims
related to the enforcement of this Agreement.  Buyer consents to the execution
by the Transferred Companies prior to or at the Closing of an instrument by
which they agree to be bound by the provisions of (and in any event waive and
release those matters specified in) this Section 8.7(b) to the maximum extent
permitted by applicable Legal Requirements.  Buyer will take (and will cause the
Transferred Companies to take) such actions following the Closing as Parent
shall reasonably require (including the taking of corporate action and the
execution of instruments and confirmatory documentation) in order to implement
and give effect to the provisions of this Section 8.7(b).

 

(c)                                  In the event that an Indemnifying Party is
obligated to indemnify an Indemnified Party pursuant to this Article VIII, the
Indemnifying Party will, upon payment of such indemnity, be subrogated to all
rights of the Indemnified Party with respect to claims to which such
indemnification relates, except to the extent such subrogation would reasonably
be expected to materially and adversely affect Buyer’s ongoing or future
business.

 

(d)                                 Except (i) for the rights and remedies in
respect of this Agreement and the Ancillary Documents, (ii) with regard to those
items listed on Schedule 4.10 of the Disclosure Letter or (iii), with respect to
any director, officer or employee of a Transferred Company, in order to recover
compensation paid to such director, officer or employee for any breaches or
violations of the Rockwood Code of Business Conduct and Ethics or similar
policies, effective upon the Closing, Parent on behalf of itself and its
Affiliates (including Parent Guarantor and Sellers, but excluding the
Transferred Companies) hereby fully, finally and forever releases, discharges
and covenants not to sue and otherwise agrees not to enforce any claim, cause of
action, right, title or interest against, any Transferred Company and each
director, officer and employee of each Transferred Company and their respective
successors and permitted assigns (collectively, the “Released Persons”), with
respect to any and all claims, debts, covenants, agreements, obligations,
liabilities, actions or demands of any kind or character, based upon any fact or
circumstance, whether known or unknown, suspected or unsuspected, which
presently exists or has ever existed in the past, that any of Parent, or its
Affiliates (including the Sellers) have or may have in any manner whatsoever,
either singly or jointly with others against any of the Released Persons.

 

(e)                                  Notwithstanding anything to the contrary
herein, this Article VIII shall have no application with respect to
indemnification for Taxes, which shall be covered exclusively by Sections 9.1
and 9.2.

 

8.8                               Tax Treatment of Payments.  Any
indemnification payment made pursuant to this Article VIII shall be treated for
all Tax purposes as an adjustment to the Purchase Price, except to the extent
otherwise required by Legal Requirements following a final determination as
defined in Section 1313 of the Code.

 

8.9                               Covered Losses.  The parties agree that,
following the Closing Date, the responsibility of the parties and their
respective Affiliates with respect to Covered Losses shall be as set forth on
Schedule 8.9 of the Disclosure Letter.

 

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ARTICLE IX

 

TAX AND EMPLOYEE MATTERS

 

9.1                               Certain Tax Matters.

 

(a)                                 (i) To the extent permitted by applicable
Legal Requirements, at the request of Parent, Buyer shall cooperate with Parent
in making any elections or taking any other actions that will result in any
taxable periods of the Transferred Companies that begin prior to the Closing
Date ending on or prior to the Closing Date.

 

(ii)                                  Parent will cause to be prepared and filed
all Income Tax Returns (including any consolidated, unitary or combined Income
Tax Returns) required to be filed with respect to any Transferred Company for
any taxable period ending on or before the Closing Date (any such period, a
“Pre-Closing Period”).  Parent will include (or cause to be included) (i) the
income of the U.S. Transferred Companies and any of their Subsidiaries in the
consolidated federal Income Tax Returns filed by Parent, and (ii) the income of
a German Transferred Company of a year, in which it was a member of a German tax
group (Organschaft) with respect to such income, in the tax return of the common
parent of such German tax group, in each case for all taxable years of the
relevant companies ending on or before the Closing Date Buyer will cause to be
prepared and filed all Tax Returns other than Income Tax Returns (any such Tax
Returns, “Non-Income Tax Returns”) required to be filed with respect to any
Transferred Company for any Pre-Closing Period that are due after the Closing;
provided, however, that (A) drafts of any such Non-Income Tax Returns (other
than monthly returns for VAT, wage tax and social security) shall be provided to
Parent for its review and comment at least thirty (30) days prior to filing and
the parties will use all reasonable efforts to resolve any dispute with respect
to such Non-Income Tax Returns, but, if such dispute cannot be resolved by the
parties within fifteen (15) days after Buyer receives notice of such dispute, it
shall be referred to the Selected Accountant, (B) such Non-Income Tax Returns
shall be prepared in a manner consistent with past practice, except as otherwise
required by applicable Legal Requirements or a change in circumstances and
(C) Parent may assume responsibility for preparing any such Non-Income Tax
Returns (other than monthly returns for VAT, wage tax and social security) upon
notice to Buyer at least thirty (30) days before any such Non-Income Tax Return
is due.  Neither Buyer nor any of its Affiliates (including, after the Closing,
the Transferred Companies) shall amend any Tax Return for a Pre-Closing Period
without Parent’s consent, except to the extent there would be no potential
current or future Tax liability or other cost to Parent or any of its
Affiliates.  Notwithstanding the above provisions, (A) drafts of Non-Income Tax
Returns in relation to French Taxes shall be provided to Parent for its review
and comments at least fifteen (15) days prior to filing (or seven (7) days prior
to the date when the filing becomes due if the aforesaid fifteen (15) day period
cannot reasonably be satisfied) and the parties will use all reasonable efforts
to resolve any dispute in relation thereof, but if such dispute cannot be
resolved by the parties two (2) days before the date when the filing becomes
due, it shall be referred to the Selected Accountant; and (B) with respect to
Income Tax Returns of Viance required to be filed after the Closing Date, Buyer
shall control the actions of CSI with respect to the preparation and filing of
such

 

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Income Tax Returns based on the instructions of Parent, provided that Parent and
Buyer agree that with respect to any Pre-Closing Period, if requested by Buyer,
CSI shall cause Viance to make an election under Section 754 of the Code or any
similar provision of state Income Tax law; provided that Buyer shall indemnify
and hold harmless Parent and its Affiliates on a Net After-Tax Basis from any
Losses incurred as a result of any such election.

 

(iii)                               Following the Closing, Parent will pay, and
will indemnify and hold harmless Buyer and its Affiliates from and against, on a
Net After-Tax Basis, (A) any and all Seller Taxes for any Pre-Closing Period and
(B) any and all Taxes or other Losses (other than any expenses incurred by Buyer
with respect to claims for which Parent is exercising its right to control
pursuant to this Article IX) resulting from the breach of any representation or
warranty in Section 2.7 (for these purposes the Parties agree that “Material,”
as used in Section 2.7 means material in the context of the subject Taxes),
except to the extent such representation or warranty relates to the United
States federal Income Tax attributes (including asset basis, earnings and
profits, and foreign taxes) of a Transferred Company organized outside of the
United States; provided, however, that Buyer will pay, and will indemnify and
hold harmless Parent and its Affiliates from and against, on a Net After-Tax
Basis, any Seller Taxes for any Pre-Closing Period imposed as a result of
(x) any action outside the ordinary course of business effected after the
Closing by Buyer or its Affiliates (including by the Transferred Companies),
(y) any Tax election made after the Closing by Buyer or its Affiliates
(including by the Transferred Companies), except for any such election directed
by Parent or set forth in this Agreement or (z) the breach by Buyer of any of
its covenants hereunder.  To the extent that the accrued liability with respect
to any such Seller Taxes included in the calculation of the final Closing
Working Capital exceeds the actual liability, Buyer shall cause the Transferred
Companies to pay such excess to Parent within fifteen (15) days after filing the
relevant Tax Return for such Pre-Closing Tax Period.  Parent’s and Buyer’s
payment obligations pursuant to this Section 9.1(a)(iii) shall become due on the
date on which Buyer or its Affiliates, or Parent and its Affiliates, have to pay
the respective Taxes.

 

(b)                                 (i) Buyer will cause to be prepared and
filed all Tax Returns required to be filed by or on behalf of any Transferred
Company for any taxable period beginning before and ending after the Closing
Date (any such period, a “Straddle Period”); provided, however, that (A) drafts
of any such Tax Returns (other than monthly returns for VAT, wage tax and social
security, and sales Tax and similar Taxes) shall be provided to Parent for its
review and comment at least thirty (30) days prior to filing, and the parties
will use all reasonable efforts to resolve any dispute with respect to such Tax
Returns, but, if such dispute cannot be resolved by the parties within fifteen
(15) days after Buyer receives notice of such dispute, it shall be referred to
the Selected Accountant for resolution and (B) such Tax Returns shall be
prepared in a manner consistent with the last Tax Returns previously filed by
the Transferred Companies, except as otherwise required by applicable Legal
Requirements or a change in circumstances or as otherwise consented to by
Parent.  Neither Buyer nor any of its Affiliates (including, after the Closing,
the Transferred Companies) shall amend any Tax Return for a Straddle Period
without Parent’s written consent, which shall not be unreasonably withheld,
conditioned or delayed.  Notwithstanding the above provisions, drafts of French
Tax Returns (other than monthly returns

 

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for VAT, wage tax and social security, and sales Tax and similar Taxes) in
relation to the Straddle Period shall be provided to Parent for its review and
comments at least fifteen (15) days prior to filing (or seven (7) days prior to
the date when the filing becomes due if the aforesaid fifteen (15) day period
cannot reasonably be satisfied) and the parties will use all reasonable efforts
to resolve any dispute in relation thereof, but if such dispute cannot be
resolved by the parties two (2) days before the date when the filing becomes
due, it shall be referred to the Selected Accountant.

 

(ii)                                  In the case of any Taxes that are payable
for a Straddle Period, the portion of such Tax which relates to the portion of
such Straddle Period ending on the Closing Date shall (A) in the case of any
Taxes that are imposed on a periodic basis with respect to the Assets or capital
of a Transferred Company, including, for the avoidance of doubt, in property
Taxes, be deemed to be equal to the amount of such Taxes for the entire Straddle
Period multiplied by a fraction, the numerator of which is the number of days in
the portion of the Straddle Period ending on and including the Closing Date and
the denominator of which is the number of days in the entire Straddle Period and
(B) in the case of all other Taxes, be deemed to be equal to the amount which
would be payable if the relevant Straddle Period ended on and included the
Closing Date; provided, however, that exemptions, allowances and deductions that
are calculated on an annual basis (such as depreciation deductions) shall be
prorated between the portion of the applicable Straddle Period that ends on and
includes the Closing Date and the portion of such Straddle Period beginning
after the Closing Date in proportion to the number of days in each period.

 

(iii)                               Parent will, within fifteen (15) days after
the date on which the Straddle Period Tax Return is filed, reimburse Buyer for,
and will indemnify and hold harmless Buyer and its Affiliates from and against,
on a Net After-Tax Basis, any Seller Taxes for any Straddle Period, except to
the extent such Seller Taxes for a Straddle Period are imposed as a result of
(A) any action outside the ordinary course of business after the Closing
effected by Buyer or its Affiliates (including by the Transferred Companies),
(B) any Tax election made after the Closing by Buyer or its Affiliates
(including by the Transferred Companies), except for any such election directed
by Parent or set forth in this Agreement or (C) the breach by Buyer of any of
its covenants hereunder.  Any Taxes (including estimated Taxes) paid prior to
the Closing or reflected as a liability in the calculation of Closing Working
Capital with respect to any Straddle Period shall be credited against Parent’s
liability pursuant to this Section 9.1(b)(iii) and, to the extent such Taxes
paid prior to the Closing and the accrued liability with respect to any such
Seller Taxes included in the calculation of the final Closing Working Capital
exceed Parent’s actual liability, Buyer shall cause the Transferred Companies to
pay such excess to Parent within fifteen (15) days after filing the relevant Tax
Return for such Straddle Period.

 

(iv)                              Parent shall cause the French Seller and the
French Companies to terminate the French Tax Sharing Agreement with effect as of
the Closing Date and, prior to the Closing, enter into a Tax sharing termination
agreement with effect as of the Closing Date (the “French Tax Sharing
Termination Agreement”).  Without prejudice to paragraphs (ii) and (iii) above,
the French Tax Sharing Termination Agreement shall

 

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notably provide that (A) the French Seller will pay (and that Parent will cause
the French Seller to pay) installments of French corporation tax due by the
French Companies in respect of the Straddle Period to the French Treasury and
(B) that the French Companies will reimburse the French Seller for installments
of the Straddle Period.

 

(c)                                  Buyer shall be responsible for, and shall
indemnify and hold harmless Parent and its Affiliates from and against, on a Net
After-Tax Basis, any Taxes of the Transferred Companies for periods beginning
after the Closing Date and any Taxes of the Transferred Companies for the
portion of any Straddle Period beginning after the Closing Date.

 

(d)                                 Parent will be entitled to retain, or
receive prompt payment from Buyer or any Transferred Company of, any refund or
credit for overpayment of Income Taxes for which Parent (including by way of
offset) is responsible pursuant to Sections 9.1(a) or (b) plus any interest
received with respect thereto from the relevant taxing authorities, but only to
the extent such refund or credit was not included as a current asset in the
determination of the final Closing Working Capital.  Buyer will, if Parent so
requests and at Parent’s expense, cause the Transferred Companies to promptly
file for and obtain any refunds or credits to which Parent is entitled under
this Section 9.1(d).  Buyer will permit Parent to control (at Parent’s expense)
the prosecution of any such claim for refund and, when deemed appropriate by
Parent, will cause the relevant Entity to authorize by appropriate power of
attorney such person as Parent may designate to represent such Entity with
respect to such refund claimed.  For purposes of this Section 9.1(d), a party
will be deemed to have made prompt payment of a refund or credit if such payment
is made within ten (10) days of the receipt by such party of such refund or of
the use by such party of such credit.

 

(e)                                  If and to the extent that any audit or
other adjustment to a Tax Return filed by or on behalf of a Transferred Company
for a Pre-Closing Period results in an increase in any Tax liability for which
Parent is responsible pursuant to Sections 9.1(a) or (b) (including any
liability with respect to a consolidated, combined or unitary Tax) and a
corresponding Tax benefit to Buyer or any of its Affiliates (including the
Transferred Companies) for any taxable period or portion thereof following the
Closing Date (including as a result of income having been accelerated from a
period following the Closing Date to a Pre-Closing Period or deductions or
credits being deferred from a Pre-Closing Period to a period following the
Closing, or increased depreciation or amortization deductions being allowed
following the Closing), Buyer shall pay over to Parent an amount equal to any
resulting Tax savings that are actually recognized during the period of five
(5) years following the Closing Date, as such Tax savings are recognized.

 

(f)                                   Buyer will promptly notify Parent in
writing upon receipt by Buyer or any of its Affiliates (including, after the
Closing, the Transferred Companies) of notice of any pending or threatened audit
or assessment with respect to Taxes for which Parent would be required to pay or
indemnify Buyer or any of its Affiliates pursuant to Sections 9.1(a) or (b). 
Parent will have the right to control the Transferred Companies’ interest in any
Proceeding relating to any Pre-Closing Period (other than where such Proceeding
also relates to a period beginning after the Closing Date, in which case, the
Proceeding shall be controlled jointly by Buyer and Parent), including the right
to control, compromise and settle any such Proceeding, and to decide whether any
consents or waivers to extend applicable statutes of limitations will be
granted, and to employ counsel of its choice at its expense; provided, however,
that Parent shall

 

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not compromise or settle any such Proceeding without Buyer’s written consent,
which shall not be unreasonably withheld, conditioned, or delayed, if such
action would adversely affect the Transferred Companies’ liability in a manner
that is material in the context of the subject Taxes for any taxable period or
portion thereof following the Closing Date.  Buyer and Parent shall jointly
control any Proceeding relating to any Straddle Period or both a Pre-Closing
Period and a period beginning after the Closing Date and neither Parent nor
Buyer shall compromise or settle any such Proceeding without the other party’s
written consent, which shall not be unreasonably withheld, conditioned, or
delayed.

 

(g)                                  After the Closing Date, each of Buyer and
Parent will provide the other, and Buyer shall cause the Transferred Companies
to provide to Parent, (subject to reimbursement by the other party for any
out-of-pocket expenses), with such assistance, including access to the
Transferred Companies, as may reasonably be requested by the other party in
connection with the preparation of any return, report, or form with respect to
Taxes or any audit or administrative or judicial proceeding (such assistance to
include assistance in data collection and responses to information requests)
relating to liability for Taxes of the Transferred Companies or any affiliated,
consolidated, combined or unitary group in which any of the Transferred
Companies is included.

 

(h)                                 To the extent that the purchase of the
Shares by Buyer pursuant to this Agreement results in any documentary, stamp,
transfer, sales, use, excise or similar Taxes, including German real estate
transfer Taxes (“Transfer Taxes”) imposed upon Parent or Buyer or their
respective Affiliates (including the Transferred Companies), 50% of such
Transfer Taxes will be borne and paid by Parent and 50% of such Transfer Taxes
will be borne and paid by Buyer.  The parties shall cooperate in good faith to
minimize, to the extent permissible under applicable Legal Requirements, the
amount of any such Transfer Taxes.  Any Tax Return that must be filed with
respect to Transfer Taxes shall be prepared and filed when due by the party
primarily or customarily responsible under the applicable local Legal
Requirements for the filing of such Tax Returns, and such party will provide the
other party a true copy of such return as filed and evidence of the timely
filing thereof and a receipt showing payment of any Taxes owed.  Within fifteen
(15) days after the date on which the relevant Tax Return is filed, the
non-filing party shall reimburse the filing party for its share of the Transfer
Taxes with respect to such Tax Return.

 

(i)                                     Subject to Section 4.25 and to the
French Tax Sharing Termination Agreements, any Tax sharing agreement between
Parent or any of its Affiliates (other than the Transferred Companies), on the
one hand, and the Transferred Companies, on the other hand, shall be terminated
as of the Closing Date and will have no further effect for any taxable year
(whether the current year, a future year or a past year).

 

(j)                                    Except for the payments and
reimbursements of installments made in relation to the Straddle Period that are
aimed at under the French Tax Sharing Termination Agreements and except to the
extent required by Legal Requirements following a final determination as defined
in Section 1313 of the Code, any amount paid by or on behalf of any party to or
on behalf of another party pursuant to this Section 9.1 shall be treated for all
Tax purposes as an adjustment to the Purchase Price.

 

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(k)                                 Parent shall be subrogated to any rights
(including rights to indemnification) that Buyer or its Affiliates (including
the Transferred Companies) may have against third parties with respect to Taxes
paid or indemnified by Parent pursuant to this Section 9.1.

 

(l)                                     The indemnification obligations in this
Section 9.1 shall survive until sixty (60) days after the expiration of the
applicable statute of limitations; provided, however, that the indemnification
obligations of Parent in Section 9.1(a)(iii)(B) relating to a breach of a
representation or warranty, other than those representations or warranties in
Sections 2.7(f), (g), (h), (i), (m) and (o) (for the avoidance of doubt,
indemnification for which shall survive until sixty (60) days after the
expiration of the applicable statute of limitations), shall survive until ninety
(90) days after the due date for filing (taking into account any applicable
extensions) of the Tax Return for the first taxable period ending after the
Closing Date with respect to the relevant Tax.

 

(m)                             For the avoidance of doubt, for purposes of this
Section 9.1 only for German Income Taxes, a Tax shall be attributable to a
Pre-Closing Period if such Tax relates to incorrect Tax balance sheets for
periods ending on or prior to the Closing Date which have been corrected
(Bilanzberichtigung) with effect to Tax periods ending after the Closing Date
due to the expiration of the statute of limitations; provided, however, that
Buyer and its Affiliates shall not voluntarily make any such corrections and
Parent shall be afforded rights comparable to those in Sections 9.1(a) and
9.1(f) with respect to any such correction proposed by any Governmental
Authority and this Section 9.1(m) shall not apply to any balance sheet
correction (Bilanzberichtigungen) made after the seventh anniversary of the
Closing Date. With respect to any Balance Sheet correction to which this
subclause applies, Parent shall have the same rights as set forth in Sections
9.1 (a) and 9.1(f).

 

(n)                                 Sellers shall make all filings and
reportings in the People’s Republic of China necessary under Guoshuihan 2009
No. 698 (“Circular 698”) within the specified time period set out in Circular
698 and shall, to the extent required by applicable Legal Requirements, pay when
due and payable any amounts due in respect of the Tax arising as a result of the
filing contemplated by this subclause to the appropriate taxation authority of
the People’s Republic of China.

 

(o)                                 (i) Buyer and Parent agree that Buyer and
Rockwood Holdings, Inc. shall make a timely, irrevocable and effective election
under Section 338(h)(10) of the Code and any similar provision of state or local
Legal Requirements (each, a “Section 338(h)(10) Election”) with respect to the
Buyer’s purchase of the U.S. Transferred Companies that are classified as
corporations for U.S. federal Income Tax purposes on the Closing Date, other
than Sachtleben LLC.  To facilitate such elections, at the Closing, Parent shall
deliver to Buyer an IRS Form 8023 or successor form and any similar forms under
state or local Legal Requirements (each a “Form 8023”) with respect to the
Buyer’s purchase of the U.S. Transferred Companies that are classified as
corporations for U.S. federal Income Tax purposes on the Closing Date, which
Forms 8023 shall have been duly executed by Rockwood Holdings, Inc.  Buyer shall
(A) cause the applicable Form 8023 to be duly executed by an authorized person
for Buyer; (B) complete the schedules required to be attached thereto;
(C) provide a copy of the executed Form 8023 and schedules to Parent; and
(D) duly and timely file the Form 8023 as prescribed by Treasury

 

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Regulation Section 1.338(h)(10)-1 or applicable provision under state or local
Legal Requirements.

 

(ii)                                  Buyer and Parent shall use commercially
reasonable efforts to agree to an allocation of the Purchase Price and any other
items constituting consideration for U.S. federal Income Tax purposes among the
Assets of the companies for which a Section 338(h)(10) Election is made pursuant
to Section 338 of the Code and the Treasury Regulations thereunder in a manner
consistent with Schedule A-1 of the Disclosure Letter (the “Tax Allocation”). 
If Buyer and Parent reach an agreement with respect to the Tax Allocation, the
Tax Allocation shall be revised to take into account subsequent adjustments to
the Purchase Price, assumed liabilities or other consideration paid, including
any adjustment pursuant to Section 1.5, in the manner provided by Section 338 of
the Code and the Treasury Regulations thereunder.

 

(iii)                               If Buyer and Parent reach an agreement with
respect to the Tax Allocation, Buyer and Parent shall file all Tax Returns and
information reports (including IRS Form 8883 or any other forms or reports
required to be filed pursuant to Section 338 of the Code or any comparable
provisions of state or local Legal Requirements) in a manner consistent with the
Tax Allocation, as finally determined, except as otherwise required by a final
determination as defined in Section 1313 of the Code.

 

(p)                                 If necessary to prevent reduction in any Tax
attributes of the U.S. Transferred Companies under Treasury Regulation
Section 1.1502-36(d), Parent and its Affiliates, as applicable, shall make an
election under Treasury Regulation Section 1.1502-36(d)(6)(i)(A) to reduce
Parent’s or its Affiliates, as applicable, tax basis in its shares of the
relevant U.S. Transferred Company to the extent necessary to prevent such
reduction.  If this election is made, Parent and its Affiliates shall timely
provide Buyer with a copy of the Section 1.1502-36 statement filed with the
applicable Tax Return in connection with the election.  In addition, to the
extent permitted by applicable Legal Requirements, Parent and its Affiliates and
any relevant affiliated group shall not elect pursuant to Treasury Regulation
Section 1.1502-36(d)(6)(i)(B) to retain any net operating or capital loss
carryovers of the U.S. Transferred Companies.  To the extent permitted by Legal
Requirements, Buyer shall, and shall cause its Affiliates to, relinquish
pursuant to Treasury Regulation Section 1.1502-21(b)(3)(ii)(B) (or any similar
provision of state, local, or non-U.S. Legal Requirements), with respect to all
net operating losses attributable to the U.S. Transferred Companies, the portion
of the carryback period for which the U.S. Transferred Companies were members of
a consolidated group of which Parent or any of its Affiliates is or was the
common parent.

 

9.2                               Certain VAT Matters.

 

(a)                                 Buyer and Parent are of the opinion that the
transactions contemplated by this Agreement are not subject to VAT and Buyer and
Parent agree not to take any action or cause to be taken that could reasonably
be expected to cause VAT to become due.  Parent shall and shall procure that the
Sellers undertake not to opt to treat the transactions contemplated hereunder as
being subject to VAT (or other Tax of a similar nature in any jurisdiction). To
the extent that the transactions contemplated in this Agreement are subject to
VAT (or any other Tax of a similar nature in any jurisdiction), Buyer shall pay,
and shall indemnify and hold harmless

 

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Parent, Sellers and each of their Affiliates from such VAT (or any other Tax of
a similar nature in any jurisdiction) in addition to the Purchase Price,
provided Buyer has received a proper invoice which complies with the respective
VAT provisions of the respective VAT code or applicable provisions in other
jurisdictions, but only to the extent such VAT (or such other Tax) is not
triggered by actions of Sellers that are not contemplated by this Agreement. VAT
(or any other Tax of a similar nature in any jurisdiction) shall be payable by
Buyer immediately upon receipt from the Sellers of an invoice which complies
with the respective VAT provisions of the respective VAT Code or applicable
provisions in other jurisdictions.

 

(b)                                 With respect to the VAT fiscal unity
(umsatzsteuerliche Organschaft) between RSGG as the common parent company
(Organträger) and Sachtleben Wasserchemie GmbH and Sachtleben Wasserchemie
Holding GmbH as RSGG’s controlled entities (Organgesellschaft) as well as
Rockwood Specialties GmbH as common parent company and Silo Pigmente GmbH and
Rockwood Pigmente GmbH as Rockwood Specialties GmbH’s controlled entities (all
controlled entities being “Controlled VAT Members”), each common parent company
and each of its respective Controlled VAT Members shall, and the Buyer shall
procure that, the Controlled VAT Members will closely cooperate to ensure that
(i) the Controlled VAT Members will compensate their respective common parent
company for output VAT (Umsatzsteuer) on supplies and services rendered until
and including the Closing Date and (ii) the common parent companies will
compensate their respective Controlled VAT Members for input VAT (Vorsteuer) on
supplies and services received until and including the Closing Date consistent
with past practice up to the Closing Date, irrespective of whether any of the
aforementioned supplies or services have been accounted for by the respective
common parent company or Controlled VAT Member, as the case may be, before or on
the Closing Date or after the Closing Date.

 

(c)                                  For the avoidance of doubt, this
Section 9.2 relates solely to those VAT matters referred to herein and the
provisions of Section 9.1 shall control with respect to all other Tax matters,
including any VAT matters other than those referred to herein.

 

9.3                               General Labor and Benefit Plan Matters.

 

(a)                                 Effective as of the Closing, the Transferred
Companies shall withdraw from participation in all Benefit Plans other than
Transferred Company Benefit Plans, and, except as provided in Sections 9.3, 9.4
and 9.5, Buyer and its Affiliates (including the Transferred Companies), shall
continue to be responsible for any Transferred Company Benefit Plans.  From and
after the Closing, Buyer and its Affiliates (including the Transferred
Companies) shall have no liability relating to any Benefit Plans or other
employee benefit plans other than the Transferred Company Benefit Plans, and
Seller and its Affiliates shall indemnify and hold harmless Buyer and its
Affiliates with respect to any and all such liabilities.

 

(b)                                 Parent shall cause (i) the Remote Employees
to cease to be employed by Parent or its Affiliates, effective as of the
Closing, and (ii) the Seller Retained Employees to cease to be employed by the
Transferred Companies prior to or upon the Closing.  Buyer shall (or shall cause
its Subsidiaries to) make an offer of employment, effective as of the Closing,
to each Remote Employee.  Such offers of employment by Buyer (or its
Subsidiaries) shall be made in accordance with all applicable Legal Requirements
and shall offer salary levels that are the

 

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same as, and other terms of employment, that are substantially comparable in the
aggregate to, those provided to the Remote Employees on the date hereof and
other terms of employment that are substantially comparable to those provided to
similarly-situated employees of Buyer and its Affiliates.  Buyer shall provide
that, at all times following the Closing, each Remote Employee is credited with
his or her service with Parent or its Affiliates for purposes of eligibility,
vesting and benefit accruals (solely, in the case of benefit accruals, for
purposes of determining vacation and severance and as otherwise may be required
by any applicable Legal Requirements) for all service that was recognized by
Parent and its Affiliates under Benefit Plans with respect to such Remote
Employees under each of the comparable employee benefit plans, programs or
policies of Buyer or its Affiliates in which such employee becomes or may become
a participant, provided that no such service recognition shall result in any
duplication of benefits.  Parent shall be solely responsible and shall indemnify
and hold harmless Buyer, the Transferred Companies and their respective
Affiliates from Losses relating to the terminations or transfers of employment
of Remote Employees and Seller Retained Employees described in this
Section 9.3(b), other than, in the case of the Remote Employees, as a result of
Buyer’s (or its Subsidiaries’) failure to comply with its obligations as set
forth in this Section 9.3(b).

 

(c)                                  Parent shall pay or cause to be paid the
full amount that may become due or payable under, taking into account any
forfeiture or cancellation in accordance with the terms of, any transaction or
retention incentives, bonuses or awards made as a result or in connection with
the transactions contemplated by this Agreement (the “Transaction Bonuses”) to
Business Employees.

 

(d)                                 Nothing contained in Sections 9.3, 9.4 or
9.5, expressed or implied, shall (i) confer upon any of the employees of Parent,
Buyer, the Transferred Companies or any of their Affiliates or representatives,
any rights or remedies, including any right to benefits or employment, or
continued benefits or employment, for any specified period, of any nature or
kind whatsoever by reason of this Agreement; or (ii) be construed to establish,
amend or modify any benefit plan, program or Contract.

 

9.4                               U.S. Labor and Benefit Plan Matters.

 

(a)                                 From and after the Closing Date until the
one year anniversary thereof (the “U.S. Continuation Period”), Buyer shall, or
shall cause the appropriate Affiliate (other than with respect to any U.S.
Business Employees whose terms of employment are governed by a Collective
Bargaining Agreement) to provide (i) a base salary or base wages to each U.S.
Business Employee whose employment continues following the Closing and whose
terms of employment are not subject to a Collective Bargaining Agreement or
other Contract or obligation arising from such U.S. Business Employee’s
representation by a labor union (each a “Continuing U.S. Employee”) at an
annualized rate that is no less than the annualized rate of the base salary or
base wages that was provided to such employee immediately prior to the Closing
Date; and (ii) employee benefits to the Continuing U.S. Employees that are
substantially comparable in the aggregate to the employee benefits provided to
such employees immediately prior to the Closing Date (excluding any Transaction
Bonuses, change-of-control or similar benefits).  Effective as of the Closing,
Buyer shall cause the appropriate U.S. Transferred Company or Viance that is a
party to a Collective Bargaining Agreement to honor the terms of any Collective
Bargaining Agreement covering any of the Continuing U.S. Employees to which

 

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it is bound and to continue to provide any compensation or employee benefits
required to be provided under the terms of any such agreements.  With respect to
those Continuing U.S. Employees whose services are performed pursuant to an
employment agreement that is a Transferred Company Benefit Plan, effective as of
the Closing, Buyer shall cause the appropriate U.S. Transferred Company or
Viance to honor the terms of such employment agreement.

 

(b)                                 Buyer shall ensure that, at all times
following the Closing, each Continuing U.S. Employee receives full credit for
purposes of eligibility, vesting and benefit accruals (solely, in the case of
benefit accruals, for purposes of determining vacation and severance) for all
service that was recognized by the U.S. Transferred Companies or any of their
Affiliates under Benefit Plans with respect to such employee under each of the
comparable employee benefit plans, programs or policies of Buyer or its
Affiliates (including the U.S. Transferred Companies) in which such employee
becomes or may become a participant, provided that no such service recognition
shall result in any duplication of benefits.

 

(c)                                  During the U.S. Continuation Period, Buyer
shall, or shall cause the U.S. Transferred Companies and Viance to, maintain the
Rockwood Specialties Inc. Severance Pay Plan and the Viance, LLC Severance Plan,
respectively, pursuant to which the Continuing U.S. Employees who currently are
eligible to participate will be eligible to continue participation under
substantially identical terms and conditions.

 

(d)                                 Effective as of the Closing, Buyer shall
establish or maintain, or cause to be established or maintained, one or more
group health plans (the “Buyer Health Plans”) which shall cover all Continuing
U.S. Employees and dependents who immediately prior to the Closing were covered
under any group health plan maintained by Parent or any of its Affiliates.  With
respect to any Buyer Health Plans that are self-insured and, to the extent
commercially reasonable, with respect to any insured Buyer Health Plans, Buyer
shall cause such Buyer Health Plans to (i) waive any waiting period and any
exclusion or limitation for preexisting conditions which were covered (generally
and/or specifically as to any individual) under any group health plan maintained
by Parent or any of its Affiliates; and (ii) grant credit (for purposes of
annual deductibles, co-payments and out-of-pocket limits) for any covered claims
incurred or payments made prior to the Closing Date during the plan year in
which the Closing Date occurs, in each case, to the extent all information
reasonably necessary to implement such actions has been received from Parent.

 

(e)                                  (i)                                    
Buyer shall take all steps necessary to permit each Continuing U.S. Employee who
has received an eligible rollover distribution (as defined in
Section 402(c)(4) of the Code) from the Rockwood Retirement Plan to roll over
such eligible rollover distribution as part of any lump sum cash distribution
into an account(s) under a 401(k) plan maintained by Buyer or its Affiliates
(the “Buyer 401(k) Plan”).

 

(ii)                                  If the Closing occurs before Parent PSP
Contributions and Parent Nonelective Contributions for the 2013 plan year have
been credited to participant accounts under the Rockwood Retirement Plan, then
with respect to each Continuing U.S. Employee who is a participant in the
Rockwood Retirement Plan on the Closing Date and who continues or has continued
employment with Buyer or any of its Affiliates (including the U.S. Transferred
Companies) through December 31, 2013, Seller shall in its discretion, at the

 

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time such contributions are made with respect to the 2013 plan year, either
(A) credit such Continuing U.S. Employee’s balance under the Rockwood Retirement
Plan with an amount equal to the Continuing U.S. Employee’s 2013 Parent PSP
Contribution and Parent Nonelective Contribution or (B) transfer to Buyer for
payment by Buyer (or by its Affiliates) to such Continuing U.S. Employee an
amount in cash equal to the Continuing U.S. Employee’s 2013 Parent PSP
Contribution and Parent Nonelective Contribution.

 

(iii)                               For the avoidance of doubt, neither the
Parent PSP Contribution nor the Parent Nonelective Contribution, nor any assets
or liabilities associated therewith, shall be reflected in the Final Closing
Statement or be taken into account in the calculation of Closing Working
Capital.

 

(f)                                   Following the Closing, Buyer shall (i) pay
to the Continuing U.S. Employees, collectively, such aggregate amount with
respect to Parent’s or any of its Affiliates’ (including the Transferred
Companies’) bonus plans for the bonus plan year in which the Closing occurs (the
“Bonus Plans”) as are reflected in the calculation of Closing Working Capital
and taken into account in the calculation of the Final Closing Statement; and
(ii) provide each Continuing U.S. Employee with a bonus opportunity (subject to
achievement of applicable performance targets) for the portion of the bonus plan
year in which the Closing occurs, if any, that occurs from and after the Closing
Date, that is no less favorable than the bonus compensation amounts applicable
to such Continuing U.S. Employee under the Bonus Plans immediately prior to the
Closing.  Any amounts payable by Buyer pursuant to this Section 9.4(f) shall be
paid at such times and in such manner as such amounts would have been payable
under the Bonus Plans.

 

(g)                                  Upon reasonable request and to the extent
permitted by applicable Legal Requirements, Parent shall provide to Buyer, and
Buyer shall provide to Parent, such documents, data and information as may
reasonably be necessary to implement the provisions of this Section 9.4 and to
administer their respective benefit plans.

 

9.5                               Non-U.S. Labor and Benefit Plan Matters.

 

(a)                                 Buyer shall, effective as of the Closing,
provide the Sachtleben Pigments Oy Pension Fund with a contribution or guarantee
in an amount sufficient to cover any underfunding of the Sachtleben Pigments Oy
Pension Fund (Sachtleben Pigments Oy:n Eläkesäätiö) as of the Closing Date and
to obtain the release of HSBC Bank USA, N.A. from the Standby Letter of Credit,
dated March 19, 2013 issued by HSBC Bank USA, N.A. in favor of the Sachtleben
Pigments Oy Pension Fund.

 

(b)                                 Upon reasonable request and to the extent
permitted by applicable Legal Requirements, Parent shall provide to Buyer, and
Buyer shall provide to Parent, such documents, data and information as may
reasonably be necessary to implement the provisions of this Section 9.5 and to
administer their respective benefit plans.

 

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ARTICLE X

 

MISCELLANEOUS

 

10.1        Expenses.  Except as otherwise set forth in this Agreement, the fees
and expenses (including the fees of any lawyers, accountants, investment bankers
or others engaged by such party) in connection with this Agreement and the
transactions contemplated hereby whether or not the transactions contemplated
hereby are consummated will be paid by Buyer with respect to fees and expenses
incurred by Buyer and its Affiliates and will be paid by Parent with respect to
fees and expenses incurred by Parent and its Affiliates (including the Sellers
and the Transferred Companies).

 

10.2        Headings.  The headings, subheadings and captions in this Agreement,
the Disclosure Letter and in any Exhibit or Schedule hereto or thereto are for
reference purposes only and are not intended to affect the meaning or
interpretation of this Agreement.

 

10.3        Notices.  All notices and other communications required or permitted
under this Agreement shall be in writing and given by certified or registered
mail, return receipt requested, nationally recognized overnight delivery
service, such as Federal Express, facsimile (or like transmission) with
confirmation of transmission by the transmitting equipment or personal delivery
against receipt to the party to whom it is given and accompanied by a copy sent
by electronic mail (which such email copy shall not constitute notice), in each
case, at such party’s address, facsimile number or email address set forth
below:

 

In the case of Parent, to:

 

Rockwood Specialties Group, Inc.
100 Overlook Center
Princeton, NJ 08540
Fax:  609-514-8722
Email:  triordan@rocksp.com and mvalente@rocksp.com
Attn:  Thomas J. Riordan and Michael W. Valente

 

with a copy to:

 

Hughes Hubbard & Reed LLP
One Battery Park Plaza
New York, New York 10004
Fax:  212-422-4726
Email:  modlin@hugheshubbard.com
Attn:  James Modlin, Esq.

 

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In the case of Buyer, to:

 

Huntsman International LLC

500 Huntsman Way

Salt Lake City, Utah 84108

Attn:  Legal Department — David Stryker and Troy Keller

Fax:  (801) 584-5782

Email: David_Stryker@huntsman.com and
Troy_Keller@huntsman.com

 

with a copy to:

 

Vinson & Elkins L.L.P.

1001 Fannin, Suite 2500

Houston, TX 77002

Attn: Jeffery B. Floyd and Stephen M. Gill

Fax:   (713) 615-5660

Email: jfloyd@velaw.com and sgill@velaw.com

 

or to such other address as the party may have furnished in writing in
accordance with the provisions of this Section.  Any such notice or other
communication shall be deemed to have been given on the date so personally
delivered or transmitted by facsimile or like transmission (or if delivered or
transmitted after the recipient’s normal business hours, on the next Business
Day), on the next Business Day when sent by overnight delivery services or five
(5) days after the date so mailed if by certified or registered mail.  A party
may change the address to which notices are to be addressed by giving the other
party notice in the manner herein set forth.

 

10.4        Assignment.  This Agreement and all provisions hereof will be
binding upon and inure to the benefit of the parties hereto and their respective
successors and permitted assigns; provided, however, that neither this Agreement
nor any right, interest, or obligation hereunder may be assigned by any party
hereto without the prior written consent of the other party, except that
(a) Buyer may assign any right hereunder, in whole or in part, to any Subsidiary
of Buyer Guarantor (without limitation or release of Buyer’s liabilities
hereunder) and (b) Parent may assign any right hereunder, in whole or in part,
to any Subsidiary of Parent Guarantor (without limitation or release of Parent’s
liabilities hereunder); provided, further that no party hereto or successor or
assignee shall have the ability to subrogate any other Person to any right or
obligation under this Agreement.  Any purported assignment or subrogation in
violation of this Agreement shall be null and void ab initio.  Notwithstanding
anything to the contrary in this Section 10.4, Buyer may assign its
indemnification rights pursuant to Section 8.2(g) in respect of an Acquired Site
in connection with any sale, disposal or other transfer of any such Acquired
Site; provided that it shall be a condition of such assignment that such
assignee agrees to be bound by and be subject to the limitations of this
Agreement.

 

10.5        Entire Agreement.  This Agreement (including the Disclosure Letter
and any Schedule or Exhibit hereto or thereto), the Confidentiality Agreement
and the Ancillary Documents contain the entire agreement and understanding of
the parties with respect to the transactions contemplated hereby and thereby and
supersede all prior written or oral

 

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commitments, arrangements or understandings with respect hereto and thereto
(other than the Confidentiality Agreement, which will terminate at the Closing
but survive any termination of this Agreement).  To the extent the terms or
provisions of this Agreement, the Confidentiality Agreement and/or the Ancillary
Documents conflict, the terms and provisions of this Agreement will control.

 

10.6        Amendment; Waiver.  This Agreement may only be amended or modified
in writing signed by the party against whom enforcement of any such amendment or
modification is sought.  No waiver of any covenant, agreement, representation or
warranty made herein shall be effective or valid unless expressly waived in
writing by the party who might assert such breach.  The waiver by any party
hereto of any term or provision of this Agreement will not operate or be
construed as a waiver of any provision, failure, breach or default not expressly
identified in such written waiver or any subsequent failure, breach or default. 
No failure on the part of any party to exercise, and no delay in exercising, any
right, power or remedy hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise thereof or the exercise of any other right, power
or remedy.

 

10.7        Counterparts.  This Agreement may be executed in one or more
counterparts, all of which will be considered one and the same agreement, each
of which will be deemed an original and which shall become effective when one or
more counterparts have been signed by each of the parties and delivered to the
other party, it being understood that all parties need not sign the same
counterpart.

 

10.8        Governing Law; Consent to Jurisdiction; Waiver of Jury Trial.

 

(a)           This Agreement and each Ancillary Document shall be governed by
the laws of the State of New York, without regard to any conflicts of law
rules or principles (whether of the State of New York or any other jurisdiction)
that would result in the application of the laws of another jurisdiction, except
for mandatory Legal Requirements applicable to the transfer of the Shares and
except to the extent otherwise provided in the Lease Agreements.

 

(b)           Except as set forth in Section 4.27(i), each party hereto hereby
consents to, and confers exclusive jurisdiction upon, the courts of the State of
New York and the Federal courts of the United States of America located in the
Borough of Manhattan, City of New York in the State of New York, and appropriate
appellate courts therefrom, over any Proceeding arising out of or relating to
this Agreement or any Ancillary Document (including any Proceeding brought by a
Seller Related Party arising out of or relating to this Agreement or the
transactions contemplated hereby against a Financing Source).  Each party hereto
hereby waives, and agrees not to assert, as a defense in any such Proceeding
that it is not subject to such jurisdiction or that such Proceeding may not be
brought or is not maintainable in said courts or that this Agreement or any
Ancillary Document may not be enforced in or by said courts or that its Assets
are exempt or immune from execution, that such Proceeding is brought in an
inconvenient forum, or that the venue of such Proceeding is improper (including
with respect to Proceedings brought by a Seller Related Party against a
Financing Source).  Parent and Buyer covenant not to initiate or support (and
agree not to permit any of their Affiliates to initiate or support) any such
Proceeding in any other jurisdiction.  Service of process in any such

 

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Proceeding may be served on any party anywhere in the world, whether within or
without the State of New York, by notice in accordance with Section 10.3.

 

(c)           Each party hereby waives to the fullest extent permitted by
applicable Legal Requirements, any right it may have to a trial by jury in
respect of any Proceeding directly or indirectly arising out of, under or in
connection with this Agreement (including with respect to any Proceedings
brought by a Seller Related Party against a Financing Source).  Each party
(i) certifies that no Representative of any other party has represented,
expressly or otherwise, that such other party would not, in the event of a
Proceeding, seek to enforce the foregoing waiver; and (ii) acknowledges that it
and the other parties hereto have been induced to enter into this Agreement by,
among other things, the mutual waivers and certifications in this paragraph.

 

10.9        Specific Performance.  The parties hereto recognize that any breach
of the terms of this Agreement may give rise to irreparable harm for which money
damages may not be an adequate remedy, and accordingly agree that,
notwithstanding anything to the contrary herein, in addition to all other
remedies available to it, any nonbreaching party shall be entitled to seek to
enforce the terms and provisions of this Agreement by a decree of specific
performance in the courts contemplated by Section 10.8, this being in addition
to any other remedy at law or in equity.

 

10.10      Interpretation; Absence of Presumption.

 

(a)           For the purposes of this Agreement, (i) words in the singular
shall be held to include the plural and vice versa; (ii) the terms “hereof,”
“herein,” “hereunder”, and “herewith” and words of similar import shall, unless
otherwise stated, be construed to refer to this Agreement as a whole (including
all of the Schedules and Exhibits hereto and the Disclosure Letter) and not to
any particular provision of this Agreement, and Article, Section, Exhibit and
Schedule references are to the Articles, Sections, Exhibits, and Schedules to
this Agreement or the Disclosure Letter unless otherwise specified; (iii) 
references to a “party” or “parties” shall mean Buyer or Parent, or both of them
as the context requires; (iv) the word “including” and words of similar import
when used in this Agreement shall mean “including, without limitation,” unless
otherwise specified; and (v) the word “or” shall not be exclusive.

 

(b)           With regard to each and every term and condition of this Agreement
and any and all agreements and instruments subject to the terms hereof, the
parties understand and agree that the same have or has been mutually negotiated,
prepared and drafted, and if at any time the parties hereto desire or are
required to interpret or construe any such term or condition or any agreement or
instrument subject hereto, no consideration will be given to the issue of which
party actually prepared, drafted or requested any term or condition of this
Agreement or any agreement or instrument subject hereto.

 

10.11      Third Person Beneficiaries.  This Agreement is not intended to confer
upon any other Person any rights or remedies hereunder, except (a) as set forth
in Section 8.7(b) and Section 8.7(d); and (b) the Financing Sources are express
third party beneficiaries of, and are entitled to rely on and enforce as such
the provisions of Sections 7.2 and 10.8.  Each of Buyer and Parent may assert
the rights of Buyer Indemnitees and Seller Indemnitees, respectively, pursuant
to Article VIII hereof.

 

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10.12      Representations and Warranties; Disclosure Letter.  Neither the
specification of any Dollar amount in the representations and warranties set
forth in Article II nor the indemnification provisions of Article VIII nor the
inclusion of any items in any Schedule of the Disclosure Letter will be deemed
to constitute an admission by Parent or Buyer, or otherwise imply or create any
presumption, that any such amounts or the items so included are material for the
purposes of this Agreement, or that any such item meets any or all of the
criteria set forth in this Agreement for inclusion in such Schedule to the
Disclosure Letter or any other Schedule to the Disclosure Letter.  Nothing in
the Disclosure Letter is intended to broaden the scope of any representation or
warranty of Parent set forth in Article II of this Agreement or Buyer set forth
in Article III of this Agreement.  Disclosure of any fact or item in any
Schedule of the Disclosure Letter will be deemed to be disclosed with respect to
any other Schedule of the Disclosure Letter to the extent the relevance of such
disclosure to such other Schedule of the Disclosure Letter is reasonably
apparent.  Any capitalized terms used in the Disclosure Letter or any Schedule
hereto or thereto but not otherwise defined therein shall be defined as set
forth in this Agreement.

 

10.13      Severability.  If any one or more of the provisions of this Agreement
is held to be invalid, illegal or unenforceable, the validity, legality or
enforceability of the remaining provisions of this Agreement will not be
affected thereby, and Parent and Buyer will use their commercially reasonable
efforts to substitute one or more valid, legal and enforceable provisions which
insofar as practicable implement the purposes and intent hereof.  To the extent
permitted by applicable Legal Requirements, each party waives any provision of
applicable Legal Requirements which renders any provision of this Agreement
invalid, illegal or unenforceable in any respect.

 

10.14      NO OTHER REPRESENTATIONS OR WARRANTIES.  THE PARTIES HERETO AGREE
THAT EXCEPT FOR THE REPRESENTATIONS AND WARRANTIES CONTAINED IN THIS AGREEMENT
AND IN THE LEASE AGREEMENTS, PARENT MAKES NO REPRESENTATION OR WARRANTY, EXPRESS
OR IMPLIED, WRITTEN OR ORAL, AND PARENT HEREBY DISCLAIMS TO THE MAXIMUM EXTENT
PERMITTED BY APPLICABLE LEGAL REQUIREMENTS ANY SUCH REPRESENTATION OR WARRANTY
(INCLUDING ANY WARRANTY OF MERCHANTABILITY OR OF FITNESS FOR A PARTICULAR
PURPOSE), WHETHER BY PARENT, THE OTHER SELLERS, THE TRANSFERRED COMPANIES, THE
NON-CONTROLLED COMPANIES, THEIR AFFILIATES OR ANY OF THEIR DIRECTORS, OFFICERS,
EMPLOYEES, AGENTS OR REPRESENTATIVES OR ANY OTHER PERSON, WITH RESPECT TO THE
TRANSFERRED COMPANIES, THE NON-CONTROLLED COMPANIES, THE BUSINESS, THE SHARES,
THE MINORITY INTERESTS, THE BUSINESS ASSETS, THE LIABILITIES OF THE BUSINESS OR
THE EXECUTION AND DELIVERY OF THIS AGREEMENT OR THE ANCILLARY DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY OR ANY OTHER MATTER WHATSOEVER,
NOTWITHSTANDING THE DELIVERY OR DISCLOSURE TO BUYER, ANY AFFILIATE OF BUYER OR
ANY OF THEIR DIRECTORS, OFFICERS, EMPLOYEES, AGENTS OR REPRESENTATIVES OR ANY
OTHER PERSON OF ANY DOCUMENTATION OR OTHER INFORMATION (INCLUDING ANY
PROJECTIONS OR DUE DILIGENCE REPORTS) BY PARENT, THE OTHER SELLERS, THE
TRANSFERRED COMPANIES, THE NON-CONTROLLED COMPANIES, OR ANY OF THEIR AFFILIATES,
DIRECTORS, OFFICERS, EMPLOYEES, AGENTS OR REPRESENTATIVES OR ANY

 

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OTHER PERSON WITH RESPECT TO ANY ONE OR MORE OF THE FOREGOING.  NOTHING HEREIN
SHALL LIMIT THE LIABILITY OF ANY PARTY FOR FRAUD.

 

10.15      Buyer Guaranty.  Huntsman Corporation, a Delaware corporation (“Buyer
Guarantor”) irrevocably guarantees each obligation of Buyer, and the full and
timely performance by Buyer of its obligations, in each case, under the
provisions of this Agreement and the Ancillary Documents.  This is a guarantee
of payment and performance, and Buyer Guarantor acknowledges and agrees that
this guarantee is full and unconditional, and no release or extinguishment of
Buyer’s liabilities and obligations (other than in accordance with the terms of
this Agreement or the Ancillary Documents, as applicable), whether by decree in
any bankruptcy proceeding or otherwise, will affect the continuing validity and
enforceability of this guarantee.  Buyer Guarantor hereby waives, for the
benefit of Parent, (i) any right to require Parent, as a condition of payment or
performance of Buyer Guarantor, to proceed against Buyer or pursue any other
remedies whatsoever and (ii) to the fullest extent permitted by Legal
Requirements, any defenses or benefits that may be derived from or afforded by
Legal Requirements that limit the liability of or exonerate guarantors or
sureties, except to the extent that any such defense is available to Buyer under
this Agreement.  Buyer Guarantor understands that Parent is relying on this
guarantee in entering into this Agreement.  The representations and warranties
set forth in Section 3.2(a) shall apply mutatis mutandis to Buyer Guarantor as
if it was the Buyer referred to therein.

 

10.16      Parent Guaranty.  Rockwood Holdings, Inc., a Delaware corporation
(“Parent Guarantor”) irrevocably guarantees each obligation of Parent, and the
full and timely performance by Parent of its obligations, in each case, under
the provisions of this Agreement and the Ancillary Documents.  This is a
guarantee of payment and performance, and Parent Guarantor acknowledges and
agrees that this guarantee is full and unconditional, and no release or
extinguishment of Parent’s liabilities and obligations (other than in accordance
with the terms of this Agreement or the Ancillary Documents, as applicable),
whether by decree in any bankruptcy proceeding or otherwise, will affect the
continuing validity and enforceability of this guarantee.  Parent Guarantor
hereby waives, for the benefit of Buyer, (i) any right to require Buyer, as a
condition of payment or performance of Parent Guarantor, to proceed against
Parent or pursue any other remedies whatsoever and (ii) to the fullest extent
permitted by Legal Requirements, any defenses or benefits that may be derived
from or afforded by Legal Requirements that limit the liability of or exonerate
guarantors or sureties, except to the extent that any such defense is available
to Parent under this Agreement.  Parent Guarantor understands that Buyer is
relying on this guarantee in entering into this Agreement.  The representations
and warranties set forth in Section 2.3(a) shall apply mutatis mutandis to
Parent Guarantor as if it was the Parent referred to therein.

 

[Remainder of page intentionally left blank]

 

89

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

 

 

ROCKWOOD SPECIALTIES GROUP, INC.

 

 

 

 

 

 

By:

/s/ Seifi Ghasemi

 

 

Name: Seifi Ghasemi

 

 

Title: Chairman and Chief Executive Officer

 

 

 

 

HUNTSMAN INTERNATIONAL LLC

 

 

 

 

 

 

By:

/s/ Peter R. Huntsman

 

 

Name: Peter R. Huntsman

 

 

Title: Chief Executive Officer

 

SIGNATURE PAGE TO STOCK PURCHASE AGREEMENT

 

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

 

 

HUNTSMAN CORPORATION, solely for the purpose of Section 10.15

 

 

 

 

 

 

By:

/s/ Peter R. Huntsman

 

 

Name: Peter R. Huntsman

 

 

Title: Chief Executive Officer

 

 

 

 

ROCKWOOD HOLDINGS, INC., solely for the purposes of Section 10.16

 

 

 

 

 

 

By:

/s/ Seifi Ghasemi

 

 

Name: Seifi Ghasemi

 

 

Title: Chairman and Chief Executive Officer

 

SIGNATURE PAGE TO STOCK PURCHASE AGREEMENT

 

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“EXHIBIT A

 

Certain Definitions

 

“2012 Carve-Out Financial Statements” shall have the meaning specified in
Section 4.22.

 

“Acquired Sites” shall mean all Real Property of the Transferred Companies,
other than the Retained Sites.

 

“Administrative Assets” shall mean Assets utilized by Parent and its Affiliates
(other than the Transferred Companies) in providing administrative, accounting,
book and record keeping, tax, finance, insurance, legal, employee benefits,
information technology and other like services to the Transferred Companies.

 

“Administrative Services” shall mean the administrative, accounting, book and
record keeping, tax, finance, insurance, legal, employee benefits, information
technology and other like services of Parent and its Affiliates (other than the
Transferred Companies) to the Transferred Companies.

 

“Affiliate” shall mean, with respect to a Person, another Person, directly or
indirectly, through one or more intermediaries, controlled by, under common
control with or which controls, the Person specified at such time.  For purposes
of this definition, “control” (including, with correlative meanings, “controlled
by” and “under common control with”) shall mean the possession of the power to
direct or cause the direction of the management and policies of such Person,
whether through the ownership of voting securities, by contract or otherwise. 
For purposes of this Agreement and the Ancillary Documents, (i) no Person shall
be deemed to control Rockwood; and (ii) no Non-Controlled Company shall be
deemed to be an Affiliate of Rockwood or any of its Affiliates.

 

“Agreement” shall have the meaning specified in the Preamble.

 

“AktG” shall have the meaning specified in Section 2.13(b).

 

“Ancillary Documents” shall mean the Transition Services Agreement, the Local
Transfer Agreements (if any), the Lease Agreements, the LLC Interest
Assignments, the Share transfer instruments described in Section 1.4, the
certificates described in Section 1.4, the letter agreement between Parent and
Buyer dated as of September 17, 2013, and any other certificate or other
instrument delivered pursuant to this Agreement or any of the foregoing.

 

“Antitrust Laws” shall mean any Legal Requirements governing competition,
monopolies, restrictive trade practices or competition-related premerger
notifications, including Legal Requirements relating to merger control or
foreign investments.

 

“Applicable Anti-Corruption Laws” shall have the meaning specified in
Section 2.17(a)(i).

 

“Applicable Trade Laws” shall have the meaning specified in Section 2.18(a).

 

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“Applicable Non-U.S. Antitrust Law” shall mean any Antitrust Law of Governmental
Authorities (other than Governmental Authorities of the United States (or any
states thereof) and the European Union) that applies to the transactions
contemplated by this Agreement.

 

“Approval” shall mean any franchise, license, certificate of compliance,
authorization, consent, order, permit, waiver, exemption, approval or other
action of, or any filing, registration or qualification with, or any notice or
declaration to, any Governmental Authority.

 

“Assets” shall mean all properties, assets, privileges, rights, interests and
claims, personal, tangible and intangible, of every type and description.

 

“Augusta Construction Agreements” shall mean the Design Build Agreement, the
Development Agreement and all other Contracts entered into by Parent or its
Affiliates (prior to the Closing) and Buyer and its Affiliates (from and after
the Closing) in connection with the construction of the Augusta Facility.

 

“Augusta Construction Cost” shall mean all bona fide cash Capital Expenditures
and owners’ costs made that relate to the construction of the Augusta Facility
as contemplated by the Augusta Construction Agreements.

 

“Augusta Cost Overrun Amount” shall have the meaning specified in
Section 1.6(a).

 

“Augusta Cost Statement” shall have the meaning specified in Section 1.6(b).

 

“Augusta Dispute Notice” shall have the meaning specified in Section 1.6(c).

 

“Augusta Disputed Items” shall have the meaning specified in Section 1.6(c).

 

“Augusta Facility” shall mean the production facility under construction in
Augusta, GA pursuant to the Augusta Construction Agreements.

 

“Augusta Qualified Costs” shall mean all bona fide cash Capital Expenditures and
owners’ costs that are made by Buyer and its Affiliates (including the
Transferred Companies) after Mechanical Completion to enable the successful
completion of the Performance Test, including any Changes or Modifications that
are reasonably required in order to enable the Augusta Facility to satisfy the
Performance Test; provided, however, that if the aggregate Augusta Construction
Costs (whether incurred by Parent and its Affiliates or by Buyer and its
Affiliates) is less than $172.0 million, the amount of such shortfall shall be
deducted Dollar-for-Dollar from the amount of such Augusta Qualified Costs.

 

“Augusta Related Activities” shall have the meaning specified in Schedule A-10
of the Disclosure Letter.

 

“Augusta Sites” shall mean the real property  located at (i) 7011 Muirkirk Road,
Beltsville, Maryland 20705 (including parcel on Conway Road); (ii) Muhlstrasse
118, 65396 Walluf, Hessen, Germany; (iii) 555 East Church Road, King of Prussia,
Pennsylvania 19406; (iv) 303 E. Hoffmeister, St. Louis, Missouri 63125; (v) West
Zhongshanyuan Road, Nanshan District, Shenzhen City, China; and (vi) 74 Swisher
Drive, Cartersville, Georgia 30120.

 

A-2

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“Augusta Spending Benchmark” shall mean (i) the aggregate amounts specified in
Schedule A-6 of the Disclosure Letter until and excluding the month in which the
Closing occurs, plus (ii) the prorated portion (based on the number of days in
such month relative to the Closing Date) of the amount set forth in Schedule A-6
of the Disclosure Letter for the month in which the Closing occurs.

 

“Augusta Underspend” shall mean the amount by which the Augusta Spending
Benchmark as of the Closing Date exceeds the amount of Augusta Construction
Costs of Parent and its Affiliates actually paid prior to the Closing Date.

 

“Back-to-Back Amounts” shall mean any Protected Losses (as defined in the
Environmental Deed) suffered or incurred by any Buyer Indemnitee following the
Closing Date solely to the extent indemnification for such Protected Losses is
available to Parent or its Affiliates pursuant to the Environmental Deed.

 

“Back-to-Back Obligations” shall mean the obligations of a member of a
Back-to-Back Group (as defined in the Environmental Deed) to comply with and in
all respects be bound by the provisions of the Environmental Deed.

 

“Balance Sheet” shall have the meaning specified in Section 2.4(a).

 

“Balance Sheet Date” shall have the meaning specified in Section 2.4(a).

 

“Bank Accounts” shall mean each bank account of any Transferred Company (other
than accounts which will be closed or transferred to Parent or any of its
Affiliates (other than the Transferred Companies)) prior to the Closing.

 

“Bankruptcy and Equity Exceptions” shall mean applicable Legal Requirements
relating to bankruptcy, insolvency, reorganization, moratorium or other similar
Legal Requirements relating to or affecting creditors’ rights generally and
except as such enforceability is subject to general principles of equity
(regardless of whether enforceability is considered in a proceeding in equity or
at law).

 

“Base Purchase Price” shall have the meaning specified in Section 8.4(d).

 

“Basket Amount” shall have the meaning specified in Section 8.4(d).

 

“Bayer Guarantee” shall mean the guarantee dated July 19, 2012 given by
Sachtleben GmbH in favor of Bayer Real Estate GmbH in an amount of EUR 20.0
million for obligations of Sachtleben Pigment GmbH under the Bayer Land Use
Agreement.

 

“Bayer Land Use Agreement” shall mean the heritable building rights and land use
agreement dated July 13, 2012 between Bayer Real Estate GmbH and Sachtleben
Pigment GmbH, notarial deed no. 1618/2012 of notary public Dr. Thilo Weimar in
Leverkusen, Germany.

 

“Benefit Plans” shall have the meaning specified in Section 2.12(a).

 

“Bonus Plans” shall have the meaning specified in Section 9.4(f).

 

A-3

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“Business” shall mean the business, as conducted by the Transferred Companies or
the Retained Companies, of producing, manufacturing, marketing, developing and
selling (i) synthetic iron oxide, technical grade ultramarine blue pigments and
other complex inorganic color pigments, and pigment dispensing systems;
(ii) polyaluminum chloride and polyaluminum nitrate-based flocculants for water
treatment and as process agents in the paper industry; (iii) titanium dioxide
pigments used in synthetic fibers, cosmetics, pharmaceuticals, food and printing
inks and other catalyst applications, and zinc and barium-based inorganic
additives and pigments; (iv) after-market automotive components made of rubber,
thermoplastic and polyurethane materials used in the automotive industry; and
(v)  the Timber Treatment Business.  Notwithstanding anything to the contrary in
this Agreement, the term “Business” shall exclude the Excluded Business.

 

“Business Agreement” shall mean any Contract (i) to which any Transferred
Company is a party, or (ii) by which any Transferred Company or any of the
Business Assets are bound (other than Benefit Plans and Permits).

 

“Business Assets” shall mean all Assets of the Transferred Companies that are
used or held for use in connection with the Business, other than the
Administrative Assets or Seller Marks.

 

“Business Day” shall mean a day other than Saturday or Sunday or other day on
which banks in New York City are required or permitted to be closed.

 

“Business Employees” shall mean (a) the employees of the Transferred Companies
other than any Seller Retained Employees and (b) the Remote Employees.

 

“Buyer” shall have the meaning specified in the Preamble.

 

“Buyer 401(k) Plan” shall have the meaning specified in Section 9.4(e)(i).

 

“Buyer Covered Losses” shall have the meaning specified on Schedule 8.9 of the
Disclosure Letter.

 

“Buyer Entities” shall have the meaning specified in Section 4.30(a).

 

“Buyer Guarantor” shall have the meaning specified in Section 10.13.

 

“Buyer Health Plans” shall have the meaning specified in Section 9.4(d).

 

“Buyer Indemnitees” shall have the meaning specified in Section 8.2.

 

“Capex Plan” shall mean the plan for Capital Expenditures in 2013 and 2014 set
forth on Schedule A-7 of the Disclosure Letter.

 

“Capital Expenditures” shall mean the additions to property, plant, equipment,
other Assets and other capital expenditures of a Person.

 

“Change” shall have the meaning specified in the Design Build Agreement.

 

A-4

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“Circular 698” shall have the meaning specified in Section 9.1(n).

 

“Clay-Based Additives Business” shall mean the business conducted by the
Transferred Companies, Parent, the Sellers or their Affiliates individually,
jointly or in collaboration with or through third parties, including
researching, producing, manufacturing, marketing, developing, distributing,
trading, importing, exporting and selling (i) natural and synthetic clay-based
rheology modifiers and additives, polymer-based rheology modifiers and additives
used in a variety of applications to modify viscosity, thickness and flow
characteristics and keep solids in suspension, (ii) acid-activated clays and
(iii) clay-based feed additives.

 

“Closing” shall have the meaning specified in Section 1.3.

 

“Closing Date” shall have the meaning specified in Section 1.3.

 

“Closing Working Capital” shall mean the Working Capital determined as of
12:01 a.m. (Eastern Time) on the Closing Date (and after giving effect to the
provisions hereof that have the effect of releasing the Transferred Companies
from liabilities upon the Closing).

 

“Code” shall mean the Internal Revenue Code of 1986, as amended.

 

“Collective Bargaining Agreement” shall have the meaning specified in
Section 2.11(c).

 

“Companies” shall have the meaning specified in the Recitals.

 

“Company Marks” shall have the meaning specified in Section 4.6(c).

 

“Company Transaction Expenses” shall mean all unpaid out-of-pocket fees, costs
and expenses (including all legal, accounting, broker, finder or investment
banker fees) incurred by the Transferred Companies or their Affiliates or the
Business in connection with (i) this Agreement and the transactions contemplated
by this Agreement; (ii) the Restructurings; (iii) the sale of the Clay-Based
Additives Business; and (iv) the sale of the European Timber Treatment Business,
in each case, to the extent not accrued in the final determination of Closing
Working Capital.  The term “Company Transaction Expenses” shall include all
unpaid bonuses or other additional compensation payments payable to Business
Employees in connection with the consummation of this Agreement and the
transactions contemplated by this Agreement.

 

“Confidentiality Agreement” shall have the meaning specified in Section 4.1(b).

 

“Confidential Information” shall have the meaning specified in Section 4.21.

 

“Consent” shall mean any consent or approval of, or notice, declaration, report
or statement filed with or submitted to, any Person (other than an Approval).

 

“Continuing U.S. Employee” shall have the meaning specified in Section 9.4(a).

 

“Contract” shall mean any written contract, subcontract, agreement, commitment,
note, bond, mortgage, indenture, franchise, lease, license, sublicense or other
instrument, obligation or binding arrangement or understanding of any kind or
character.

 

A-5

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“Covered Losses” shall have the meaning specified on Schedule 8.9 of the
Disclosure Letter.

 

“Credit Support” shall have the meaning specified in Section 2.23.

 

“CSI” shall mean Chemical Specialties, Inc.

 

“Currenta Framework Agreement” shall mean the Framework Agreement dated
December 23, 2009 between Currenta GmbH & Co. KG and Tronox Pigment GmbH (as
afterwards transferred to Sachtleben Pigment GmbH by way of tripartite
assumption), including any and all individual service agreements made thereunder
or in connection therewith and in each case as amended from time to time before
Closing.

 

“Currenta Guarantee” shall mean the undated guarantee given by Sachtleben GmbH
in favor of Currenta GmbH & Co. KG in an amount of EUR 7.0 million for
obligations of Sachtleben Pigment GmbH under the Currenta Framework Agreement.

 

“Derivatives Contract” shall mean any Contract providing for a swap transaction,
option, warrant, forward purchase or sale transaction, futures transaction, cap
transaction, floor transaction or collar transaction relating to one or more
currencies, commodities, bonds, equity securities, loans, interest rates,
catastrophe events, weather-related events, credit-related events or conditions
or any indexes, or any other similar transaction (including any option with
respect to any of these transactions) or combination of any of these
transactions, including collateralized mortgage obligations or other similar
instruments or any debt or equity instruments evidencing or embedding any such
types of transactions, and any related credit support, collateral or other
similar arrangements related to such transactions.

 

“Design Build Agreement” shall mean that Contract dated as of May 7, 2013
between Rockwood Pigments and O’Neal Constructors.

 

“Development Agreement” shall mean that certain Development Agreement dated as
of February, 2013 between Rockwood Pigments and the City of Augusta, Georgia.

 

“Disclosure Letter” shall have the meaning specified in Article II.

 

“Dispute Notice” shall have the meaning specified in Section 1.5(d).

 

“Disputed Items” shall have the meaning specified in Section 1.5(d).

 

“Divestiture Action” shall have the meaning specified in Section 4.5(b).

 

“Divestiture Arrangement” shall have the meaning set forth on Schedule A-8 of
the Disclosure Letter.

 

“DOJ” shall have the meaning specified in Section 4.5(a).

 

“Dollars” or “$” shall mean the lawful currency of the U.S.

 

A-6

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“EMR” shall have the meaning specified in Section 2.3(b)(iv).

 

“Encumbrance” shall mean any claim, lien, pledge, encumbrance, mortgage, deed of
trust, charge, easement, right of way, encroachment, security interest, option
or any other similar right or interest.

 

“Enterprise Agreements” shall have the meaning specified in Section 2.13(b).

 

“Entity” shall mean any corporation, partnership, limited liability company,
joint venture, trust, unincorporated organization, other form of business or
legal entity or Governmental Authority.

 

“Environment” shall mean soil, surface water, groundwater, land, sediments,
surface or subsurface strata, ambient air, or indoor air structures.

 

“Environmental Condition” shall mean any condition of the Environment with
respect to the Real Property that violates, or otherwise requires Remedial
Action pursuant to, any Environmental Requirements or, even though not violative
of any Environmental Requirements, nevertheless results in any liability or
obligation to take Remedial Action.

 

“Environmental Deductible” shall have the meaning specified in Section 8.4(e).

 

“Environmental Deed” shall mean the Environmental Deed, dated as of
September 25, 2000, between Laporte plc and K-L Holdings, Inc. (n/k/a Rockwood
Holdings, Inc.), entered into in connection with the closing of the transactions
contemplated by the Business and Share Sale and Purchase Agreement, dated as of
September 25, 2000, between Laporte plc and K-L Holdings, Inc.

 

“Environmental Requirements” shall mean all Legal Requirements concerning the
protection of the Environment from contamination or pollution, Remedial Action
or Hazardous Substances.

 

“Equity Interest” shall mean, in respect of any Person, any share, capital
stock, partnership, membership or similar interest in such Person, and any
option, subscription, warrant, right or security (including debt securities)
convertible, exchangeable or exercisable therefor.

 

“Equityholder” shall mean, in respect of any Person, the holder of any Equity
Interests in such Person.

 

“ERISA” shall mean the Employee Retirement Income Securities Act of 1974, as
amended.

 

“ERISA Affiliate” shall mean with respect to any Entity, any other Entity that,
together with such first Entity, would be treated as a single employer within
the meaning of Sections 414(b), (c), (m) or (o) of the Code.

 

“Estimated Purchase Price” shall have the meaning specified in Section 1.5(b).

 

A-7

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“EU” shall mean the European Union.

 

“EUR” shall mean Euros.

 

“European Timber Treatment Business” shall mean the business and interests sold
pursuant to the European Timber Treatment Business Sale Agreement.

 

“European Timber Treatment Business Sale Agreement” shall mean that certain
Share Purchase Agreement, dated as of July 4, 2013, among Rockwood Specialties
Limited, Viance and International Chemical Investors GmbH.

 

“European Transferred Companies” shall mean all Transferred Companies that are
incorporated in a jurisdiction within the EU.

 

“Excluded Businesses” shall mean (i) all of the present or future businesses,
operations, activities, branches, sites, properties or other Assets owned,
operated, used or leased by Parent or any of its Affiliates (excluding the
Transferred Companies), other than the Business; and (ii) any businesses,
operations, activities, branches, sites, properties or other Assets owned,
operated, used or leased by Parent or any of its Affiliates (including the
Transferred Companies) or any predecessor in interest thereto at any time prior
to the Closing (but no longer owned, operated, used or leased by such Person at
the Closing).  The term “Excluded Businesses” shall include (a) the Clay-Based
Additives Business and (b) the European Timber Treatment Business.

 

“Final Closing Statement” shall have the meaning specified in Section 1.5(c).

 

“Final Completion” shall have the meaning specified in the Design Build
Agreement.

 

“Financial Records” shall mean all ledgers, books, records, data, files,
workpapers and accounting and financial records (regardless of physical or
electronic form) of Parent, Sellers, and the Transferred Companies, in each
case, to the extent related to the Business.

 

“Financial Statements” shall have the meaning specified in Section 2.4(a).

 

“Financing” shall mean any Indebtedness to be incurred by Buyer to finance the
Purchase Price.

 

“Financing Information” shall mean (a)(i) audited combined balance sheets and
related statements of income and cash flows of the Business audited by an
independent nationally recognized accounting firm (an “Auditor”) (A) for the
year ended December 31, 2012 and (B) the most recently completed fiscal year
ended at least ninety (90) days prior to the Closing Date; and (ii) unaudited
combined balance sheets and related statements of income and cash flows of the
Business for each subsequent fiscal quarter ended after the Balance Sheet Date
at least forty-five (45) days prior to the Closing Date (but excluding the
fourth quarter of any fiscal year); and (b) customary due diligence and similar
information reasonably requested prior to the commencement of the syndication
process by the Financing Sources as reasonably required for an information
memoranda relating to the financing to consummate the offering or placement of
debt securities (including as specifically required by the Financing
Commitments) and customary

 

A-8

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for such a financing in connection with the Marketing Material being prepared by
Buyer and the Financing Sources for the Financing.

 

“Financing Sources” shall mean the financial institutions contemplated to be
party to the Financing, together with their Representatives.

 

“Form 8023” shall have the meaning specified in Section 9.1(o)(i).

 

“French Companies” shall mean Holliday Pigments International S.A.S., a Société
par actions simplifiée organized under the laws of France, Holliday Pigments
S.A.S., a Société par actions simplifiée organized under the laws of France, and
Holliday France S.A.S., a Société par actions simplifiée organized under the
laws of France.

 

“French Seller” shall mean Knight Chimiques de Specialité S.A.S., a Société par
actions simplifiée organized under the laws of France.

 

“French Shares” shall mean the shares of capital stock or other Equity Interests
of the French Companies set forth on Schedule 2.2 of the Disclosure Letter.

 

“French Tax Sharing Agreement” shall mean the Tax sharing agreements entered
into by and between the French Seller and each of the French Companies on
February 18, 2009.

 

“French Tax Sharing Termination Agreement” shall have the meaning specified in
Section 9.1(b)(iv).

 

“FTC” shall have the meaning specified in Section 4.5(a).

 

“GAAP” shall mean generally accepted accounting principles in the United States
as in effect from time to time.

 

“German Companies” shall mean Sachtleben Chemie GmbH, a Gesellschaft mit
beschränkter Haftung organized under the laws of Germany, Rockwood Pigmente
Holding GmbH, a Gesellschaft mit beschränkter Haftung organized under the laws
of Germany, Silo Pigmente GmbH, a Gesellschaft mit beschränkter Haftung
organized under the laws of Germany, and Sachtleben Wasserchemie (Holding) GmbH,
a Gesellschaft mit beschränkter Haftung organized under the laws of Germany.

 

“German-Controlled Entities” shall mean Sachtleben Chemie GmbH, Sachtleben
Pigment GmbH, Silo Pigmente GmbH, Rockwood Pigmente Holding GmbH, Sachtleben
Wasserchemie (Holding) GmbH, Sachtleben Wasserchemie GmbH.

 

“German-Controlled Entity Profit Pooling Account” shall have the meaning
specified in Section 4.25(a).

 

“German Transferred Benefit Plans” shall have the meaning specified in
Section 2.12(k).

 

“Governing Documents” shall mean, with respect to any Person, the legal
documents by which such Person establishes its legal existence or which govern
its internal affairs, including

 

A-9

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the certificate or articles of incorporation, certificate of formation,
certificate of limited partnership, articles of organization, bylaws, limited
liability company agreement, partnership agreement, formation agreement, joint
venture agreement, operating agreement, equityholder agreement or declaration or
other similar governing documents of such Person, in each case, as amended or
supplemented from time to time.

 

“Governmental Authority” shall mean any supranational, national, federal, state,
provincial, county or municipal government, domestic or foreign, any agency,
board, bureau, commission, court, department or other instrumentality of any
such government, including any commercial enterprise owned, operated, or
controlled by any of the foregoing, or any arbitrator in any case that has
jurisdiction over a party or any of its Assets, and shall include for the
avoidance of doubt, any competition authority with jurisdiction to review the
transactions contemplated hereby.

 

“Hazardous Substances” shall mean any substance, material or waste (i) that is
regulated under any Environmental Requirement; (ii) that, without limitation of
the generality of clause (i), is deemed under or by any Environmental
Requirement or Governmental Authority to be “hazardous,” “toxic,” a
“contaminant,” “solid waste,” “waste,” a “nuisance,” a “pollutant” or words with
similar meaning, and includes petroleum and petroleum products, crude oil or any
fraction or by-product thereof, polychlorinated biphenyls (PCBs), PCB wastes,
asbestos, asbestos containing products and materials and radioactive substances;
or (iii) the presence of which requires Remedial Action pursuant to applicable
Environmental Requirements.

 

“HK Company” shall mean Rockwood Far East Limited, a limited company
incorporated under the laws of Hong Kong.

 

“Holliday Chemical España” shall mean Holliday Chemical España, S.A., a public
limited liability company (sociedad anónima) organized under the laws of Spain,
registered with the Commercial Registry of Barcelona under volume (tomo) 41,871,
sheet (folio) 41, page (hoja) B97026 (initially registered under volume (tomo)
25919, sheet (folio) 187, page (hoja) B97026), and with Spanish tax
identification number A60318490.

 

“Holliday Pigments Agreement” shall mean the Stock Purchase Agreement, dated as
of July 18, 2008, among Holliday Holdings Limited, Holliday International S.A.,
Yule Catto Spain S.L., the French Seller, KL 2, Yule Catto & Co. PLC and Parent.

 

“HSR Act” shall have the meaning specified in Section 2.3(b)(iv).

 

“Identified Indebtedness” shall have the meaning specified in
Section 4.11(b)(ii).

 

“IGBCE” shall have the meaning specified in Section 4.3(b)(viii).

 

“Income Tax Return” shall mean any Tax Return relating to Income Taxes.

 

“Income Taxes” shall mean any federal, state, local, or non-U.S. Taxes measured
by or imposed on net income, gross revenue, or receipts, including franchise or
similar Taxes.

 

A-10

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“Indebtedness” of any Person shall mean (i) all indebtedness of such Person for
borrowed money, whether current or funded, fixed or contingent, secured or
unsecured, including all such indebtedness of such Person evidenced by notes,
bonds, debentures, mortgages or other similar instruments or debt securities;
(ii) all obligations of such Person for the deferred purchase price of property
or services (excluding trade payables arising in the ordinary course of
business); (iii) all indebtedness created or arising under any conditional sale
or other title retention agreement with respect to property acquired by such
Person (even though the rights and remedies of the seller or lender under such
agreement in the event of default are limited to repossession or sale of such
property); (iv) all obligations of such Person as lessee under leases that are
required, in accordance with GAAP, to be capitalized; (v) obligations under
interest rate swap, hedging or similar agreements; and (vi) all indebtedness or
obligations of others of the kinds referred to in clauses (i) though (v) above
in respect of which such Person has entered into or issued any guarantee or
other form of credit support.

 

“Indemnified Party” shall mean Buyer Indemnitees or Seller Indemnitees, as the
case may be, seeking indemnification pursuant to Article VIII.

 

“Indemnifying Party” shall have the meaning specified in Section 8.4(c).

 

“Industrial Action” shall have the meaning specified in Section 2.11(a).

 

“Intellectual Property” shall mean any and all intellectual property rights in
any jurisdiction, including rights in and to: (i) trade secrets, confidential
and proprietary information and know-how, (ii) patents, patent applications,
statutory invention registrations and rights in respect of utility models or
industrial designs, together with all reissuances, continuations,
continuations-in-part, divisions, supplementary protection certificates,
extensions and re-examinations thereof, (iii) trademarks, trade names, service
marks, trade dress, logos, corporate names, domain names and other source
identifiers, emblems, signs or insignia, and similar rights and applications to
register any of the foregoing, and all goodwill associated therewith throughout
the world, (iv) works of authorship, including copyrights, mask works, database
rights, and rights in software, and (v) all moral rights and other protectable
intellectual property and proprietary rights of a similar nature.

 

“Inventory” shall mean all inventory of the Business that would constitute
“inventory” as such term is used in the Financial Statements and all inventories
of raw materials, spare parts, work-in-process and finished goods, that, in each
of the foregoing cases, are held at, or are in transit from or to, the
facilities of the Business, or located at customers’ premises on consignment
from the Business.

 

“Intercompany Indebtedness” shall mean (a) Indebtedness owed by a Transferred
Company to Parent or an Affiliate of Parent (other than a Transferred Company);
and (b) Indebtedness owing from Parent or any of its Affiliates (other than a
Transferred Company) to the Transferred Companies.

 

“IRS” shall mean the U.S. Internal Revenue Service.

 

“IT Systems” shall mean information technology software, hardware, equipment and
other infrastructure that are used in the Business.

 

A-11

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“Italian Company” shall mean Rockwood Italia S.p.A., a Società per Azioni
organized under the laws of Italy.

 

“JV Entities” shall have the meaning specified in the Recitals.

 

“KL 2” shall mean Knight Lux 2 S.a.r.l., a société à responsabilité limitée
organized under the laws of the Grand Duchy of Luxembourg, registered with the
Luxembourg Trade and Companies’ Register under number B 100.494, having its
registered office at 61, rue de Rollingergrund, L-2440 Luxembourg, Grand Duchy
of Luxembourg.

 

“Key Employee” shall have the meaning specified in Section 2.11(k).

 

“Knowledge” shall mean (i) in respect of Parent, the actual knowledge, after
good faith inquiry, of Thomas J. Riordan, Robert J. Zatta, Andrew M. Ross, Vern
Sumner, Chris Shadday, Clemens Rollman, Andreas Opalka, Marino Sergi, Dave
Cohen, Andreas Gruenwald, Steve Novak, Jonathan Moyes and Thorn Baccich; and
(ii) in respect of Buyer, the actual knowledge, after good faith inquiry, of J.
Kimo Esplin, John R. Heskett, Simon Turner and Troy Keller (for the avoidance of
doubt, this definition shall only be applicable where the word “Knowledge” or
any of its derivatives is capitalized in the first letter).

 

“Lease Agreements” shall have the meaning specified in Section 4.29.

 

“Leased Real Property” shall mean the real property leased by a Transferred
Company or Non-Controlled Company pursuant to the Leases.

 

“Leased Sites” shall mean the Augusta Sites, the Specified Sites and the
Long-Term Sites.

 

“Leases” shall have the meaning specified in Section 2.9(b).

 

“Legal Requirements” shall mean all statutes, ordinances, Orders, directives,
requirements, codes, rules and regulations of Governmental Authorities.

 

“LLC Interest Assignment” shall have the meaning specified in
Section 1.4(a)(ii).

 

“Local Transfer Agreement” shall have the meaning specified in Section 1.4(c).

 

“Long-Term Sites” shall mean the real property located at (i) Liverpool Road
East, Kidsgrove, Stoke on Trent, Staffordshire ST7 3AA, United Kingdom; (ii) 
Mary Avenue, Chester Le Street, Birtley, Durham DH3 1QX, United Kingdom; and
(iii) 1525 Wood Avenue, Easton, Pennsylvania 18045.

 

“Losses” shall mean losses, liabilities, obligations, damages, diminutions of
value, demands, claims, actions, causes of action, fines, costs and expenses of
defense thereof (including reasonable investigatory fees and expenses and fees
and disbursements of counsel).

 

“Marketing Material” shall mean each of the following materials prepared by
Buyer, the Financing Sources, or the Representatives of the foregoing (including
based on, and

 

A-12

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incorporating excerpts from the Financing Information): (a) customary bank
books, information memoranda and other information packages regarding the
business, operations, financial condition, projections and prospects of
Transferred Companies, including documentation relating to the transactions
contemplated hereunder; and (b) all other marketing material contemplated by the
Financing Commitments or reasonably required by Buyer or its Financing Sources’
reasonable discretion, in connection with the syndication or other marketing of
the Financing, in each case, that is customary for financings of the type
contemplated by the Financing Commitments.

 

“Material Adverse Effect” shall mean any event, change, effect, circumstance or
development (each, an “Effect”) that, individually or in the aggregate, has, has
had or reasonably could be expected (i) to have a material adverse effect on the
business, assets, financial condition or results of operations of the Business
taken as a whole or (ii) to prevent or materially delay Parent’s or the Sellers’
ability to perform any of their obligations under or the consummation of the
transactions contemplated by this Agreement and the Ancillary Documents to be
executed and delivered by Parent and the Sellers.  For purposes of clause
(i) only, any Effect resulting or arising from any of the following shall not be
considered when determining whether a Material Adverse Effect shall have
occurred:  (a) changes in the general economic, financial, credit or securities
markets, including prevailing interest rates or currency rates, or regulatory or
political conditions; (b) conditions generally affecting the industries or
markets in which the Business operates; (c) any natural disaster, outbreak or
escalation of hostilities, act or acts of war (whether or not declared) or
terrorism, military actions or other national or international calamity or
crisis; (d) the suspension of trading in securities on any U.S. or foreign stock
exchange, or a disruption in securities settlement, payment or clearance
services in the U.S. or elsewhere; (e) changes in applicable Legal Requirements
or GAAP or any formal pronouncements related thereto; (f) the taking of any
action by any Governmental Authority in respect of its monetary or fiscal
affairs; (g) this Agreement or the announcement thereof or the consummation of
the transactions contemplated by this Agreement and the Ancillary Documents;
(h) actions of Buyer or its Affiliates in respect of the Business or the
Transferred Companies (other than pursuant to or in accordance with this
Agreement); (i) any action taken by Parent pursuant to or in accordance with the
Agreement or at the request of or with the consent of Buyer; (j) any reduction
in the price of services or products offered by any of the Business in
reasonable response to the reduction in price of comparable services or products
offered by a material competitor; or (k) any failure by the Business to meet any
estimates, projections, forecasts, guidance or revenue or earnings predictions
for any period ending prior to, on or after the date of this Agreement (but not
the underlying cause of, reasons for or factors contributing to such failure);
provided, however, that the exceptions contained in the foregoing clauses (a),
(b), (c), (d), (e) and (f) shall not apply to the extent such Effect has a
disproportionate adverse effect on the Business taken as a whole, as compared to
other participants in the industries or markets in which the Business operates.

 

“Material Contracts” shall have the meaning specified in Section 2.10(a).

 

“Mechanical Completion” shall have the meaning specified in the Design Build
Agreement.

 

A-13

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“Minority Interests” shall mean the shares of capital stock or other Equity
Interests of each Non-Controlled Company owned by the applicable Seller as set
forth on Schedule 2.2 of the Disclosure Letter.

 

“Modification” shall mean any changes to the design or construction of the
Augusta Plant not constituting a Change.

 

“Multiemployer Plan” shall mean any “multiemployer plan” within the meaning of
Section 4001(a)(3) of ERISA.

 

“Net After-Tax Basis” shall mean, with respect to the calculation of any
indemnification payment owed to any party pursuant to the Agreement, calculation
thereof in a manner taking into account any cash Taxes owing or increase in cash
Taxes otherwise payable by the Indemnified Party or its Affiliates as a result
of the receipt or accrual of the indemnity payment (and if not owed or payable
in the year the indemnification payment was made, which amount shall be paid to
the Indemnified Party when such cash Taxes are paid) and any actual savings in
Taxes by the Indemnified Party or its Affiliates as a result of payment or
accrual of the indemnified liability when and as realized as a cash benefit or
reduction in cash Taxes otherwise payable (and if not realized in the year the
indemnified liability accrued or the indemnification payment was made, which
amount shall be paid to the indemnifying party when such realization occurs).

 

“Non-Controlled Companies” shall have the meaning specified in Section 2.1.

 

“Non-Income Tax Returns” shall have the meaning specified in Section 9.1(a)(ii).

 

“Non-Operating Sites” shall mean the real property owned on the date of this
Agreement by a Transferred Company or a Retained Company, as applicable, located
at (i) 1 and 7 Swisher Drive, Cartersville, Georgia 30120; (ii) 100 Commerce
Avenue, Harleyville, South Carolina 29448; (iii) 333 Cypress Road, Ocala,
Florida 34472; and (iv) Industrial Boulevard, Gilmer, Texas 75644.

 

“Non-U.S. Antitrust Approvals” shall have the meaning specified in
Section 2.3(b)(iv).

 

“Nuodex Italiana” shall mean Nuodex Italiana s.r.l., a società a responsabilità
limitata organized under the laws of Italy.

 

“O’Neal Constructors” shall mean O’Neal Constructors, LLC.

 

“Off-Site Environmental Matter” shall mean any Environmental Requirements,
Remedial Action or Third-Party Claims resulting from or arising out of any
storage, transportation, disposal or release by or on behalf of a Transferred
Company of any Hazardous Substance into the Environment at a location other than
the Acquired Sites prior to the Closing.

 

“Order” shall mean any order, writ, assessment, decision, injunction, decree,
ruling, judgment, administrative agreement or determination, or similar action,
whether temporary, preliminary or permanent, of a Governmental Authority.

 

A-14

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“Outside Date” shall have the meaning specified in Section 7.1(e).

 

“Owned Real Property” shall have the meaning specified in Section 2.9(a).

 

“Parent” shall have the meaning specified in the Preamble.

 

“Parent Covered Losses” shall have the meaning specified on Schedule 8.9 of the
Disclosure Letter.

 

“Parent PSP Contribution” for a Continuing U.S. Employee shall mean an amount
equal to the product of (x) the “covered compensation” under the Rockwood
Retirement Plan earned by such Continuing U.S. Employee from the beginning of
the Rockwood Retirement Plan’s 2013 plan year through the Closing Date or
December 31, 2013, if earlier, and (y) the “applicable percentage” under the
Rockwood Retirement Plan for the 2013 plan year.

 

“Parent Guarantor” shall have the meaning specified in Section 10.16.

 

“Parent Nonelective Contribution” for a Continuing U.S. Employee shall mean an
amount equal to the product of (x) the “covered compensation” under the Rockwood
Retirement Plan earned by such Continuing U.S. Employee from the beginning of
the Rockwood Retirement Plan’s 2013 plan year through the Closing Date or
December 31, 2013, if earlier, and (y) 3%.

 

“Parent Sachtleben Covered Losses” shall have the meaning specified in
Section 8.9.

 

“PBGC” shall mean the Pension Benefit Guaranty Corporation.

 

“Performance Test” shall mean the successful completion of a Test Run.

 

“Permit” shall mean any permit or authorization of the Transferred Companies
issued by any Governmental Authority in connection with the Business or any of
the other Business Assets.

 

“Permitted Encumbrances” shall mean (i) Encumbrances for Taxes, assessments and
other governmental charges which are not due and payable and which may
thereafter be paid without interest or penalty or which are being contested in
good faith through appropriate Proceedings, in each case, only if adequate
reserves with respect thereto have specifically been established therefor;
(ii) the title and other interests of a lessor under a capital or operating
lease or of a licensor under a license or royalty agreement; (iii) Encumbrances
arising or resulting from any action taken by Buyer or any of its Affiliates;
(iv) Encumbrances identified on Schedule A-9 of the Disclosure Letter; (v) with
respect to any Business Asset, Encumbrances which do not in any material respect
interfere with or restrict the use of such Business Asset in the conduct of the
Business; (vi) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s
or other similar Encumbrances arising in the ordinary course of business, for
which no foreclosure Proceeding is pending or, to the Knowledge of Parent,
threatened and which, if such Encumbrances secure obligations that are then
overdue by more than 30 days and unpaid, are adequately bonded, or are being
contested in good faith; (vii) zoning restrictions, easements, licenses or other
restrictions on the use of any Owned Real Property or other minor irregularities
in title thereto or encumbrances thereon, so long as the same do not,
individually or in the

 

A-15

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aggregate, interfere with or impair the use of such Owned Real Property in the
manner normally used; (viii) Encumbrances disclosed in any title reports which
have been made available to Buyer, along with the title exception documents
referred to therein, for the specific Owned Real Property to which they relate,
in each case prior to the date of this Agreement; (ix) Encumbrances securing the
Indebtedness of Parent and its Affiliates that will be released on or prior to
Closing, (x) any Encumbrances that appear in title insurance policies with
respect to Owned Real Property obtained by Buyer; (xi) Encumbrances that would
be reflected in a survey of the Owned Real Property; (xii) such other
Encumbrances as in the aggregate would not be reasonably likely to be material
to the Business; and (xiii) all Encumbrances related to any Transferred Company
Indebtedness that remains outstanding as of the Closing Date in accordance with
the Agreement.

 

“Person” shall mean any individual or Entity.

 

“Post-Closing Augusta Construction Cost” shall have the meaning specified in
Section 1.6(a).

 

“Pre-Closing Environmental Condition” shall mean any Environmental Requirements,
Remedial Action or Third-Party Claims resulting from or arising out of any
Environmental Condition existing or occurring at or prior to the Closing. 
Notwithstanding the foregoing, the term “Pre-Closing Environmental Condition”
shall not include any routine costs of complying with Environmental Requirements
that are incurred in the ordinary course of business prior to the Closing but
that have not become due and payable according to customary terms until after
the Closing.

 

“Pre-Closing Period” shall have the meaning specified in Section 9.1(a)(ii).

 

“Prime Rate” shall have the meaning specified in Section 1.5(f).

 

“Proceeding” shall mean any action, suit, arbitration proceeding, administrative
or regulatory investigation, audit, proceeding, litigation of any nature (civil,
criminal, regulatory or otherwise) at law or in equity.

 

“Product” shall mean those “dry” and packaged products listed on Schedule A-11
of the Disclosure Letter with the specifications provided on Schedule A-3 of the
Disclosure Letter.

 

“Product Quality Test Methods” shall mean the product quality test methods
listed on Schedule A-12 of the Disclosure Letter.

 

“Property” shall have the meaning specified in 2.9(e).

 

“Purchase Price” shall have the meaning specified in Section 1.1.

 

“Purchase Price Adjustments” shall have the meaning specified in Section 1.1.

 

“Qualified Party” shall have the meaning set forth on Schedule A-13 of the
Disclosure Letter.

 

A-16

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“Real Property” shall mean the Owned Real Property and the Leased Real Property
but, for the avoidance of doubt, shall not include the Non-Operating Sites.

 

“Receiving Party” shave have them meaning specified in the Transition Services
Agreement.

 

“Registered Intellectual Property” shall have the meaning specified in
Section 2.15(a).

 

“Released Persons” shall have the meaning specified in Section 8.7(d).

 

“Relevant Employees” shall have the meaning specified in Section 2.12(a).

 

“Remedial Action” shall mean all action necessary:  (i) to clean up, close,
remove, treat or in any other way remediate any Hazardous Substance; (ii) to
clean up, remediate, prevent or contain the release, spill, emission, leaking,
dumping, injection, pouring, deposit, disposal, discharge, dispersal, leaching
or migration into the environment (including ambient air, surface water,
groundwater, land surface or subsurface strata) or within any building,
structure, facility or fixture of any Hazardous Substance so that it does not
endanger or otherwise adversely affect the environment or public health or
welfare; (iii) to perform pre-remedial studies, investigations or monitoring,
in, under or of any real property, tangible assets or facilities; (iv) to
demolish and remove any building, structure or facility on the applicable site,
if related to a remedial action; or (v) to repair any damage to the Environment,
including natural resources, or to restore the Environment to a condition
acceptable to the relevant Governmental Authority.

 

“Remote Damages” shall mean any exemplary, special or punitive damages and any
loss of profits, revenue or income, or loss of business reputation or
opportunity or other damage that is not a reasonably foreseeable consequence of
a breach, inaccuracy or failure to perform any representation, warranty,
covenant, obligation or other agreement.

 

“Remote Employee” shall have the meaning specified in Section 2.11(h).

 

“Representatives” shall mean, in respect of any Person, such Person’s and its
Affiliates’ directors, officers, employees, financial advisors, attorneys,
accountants, consultants, agents, other advisors and other representatives
acting on such Person’s behalf.

 

“Required Consents” shall have the meaning specified in Section 4.4(b).

 

“Required Financials” shall have the meaning specified in Section 4.30(a).

 

“Required Non-U.S. Antitrust Approvals” shall have the meaning specified in
Section 4.5(a).

 

“Resigning Officers and Directors” shall mean each individual listed on
Schedule 1.4(a)(xii) of the Disclosure Letter.

 

“Restricted Business” shall have the meaning specified in Section 4.15(b).

 

“Restricted Territory” shall have the meaning specified in Section 4.15(b).

 

A-17

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“Restructurings” shall mean the transactions described in Schedule A-2 of the
Disclosure Letter.

 

“Retained Cash Balances” shall mean the aggregate amount of all cash and cash
equivalents in Bank Accounts at the Closing; provided, however, that (i) only
50% of all cash and cash equivalents in Bank Accounts of Transferred Companies
other than U.S. Transferred Companies and European Transferred Companies shall
be taken into account; (ii) no cash and cash equivalents in Bank Accounts of
Non-Controlled Companies shall be taken into account; and (iii) only 50% of all
cash and cash equivalents in Bank Accounts of Viance in excess of $2.0 million
shall be taken into account.

 

“Retained Companies” shall mean Southern Color N.A., Inc., Excalibur Realty
Company, Excalibur Realty UK Limited and Chillihurst Limited.

 

“Retained Liabilities” shall mean (i) the ownership, existence, business, and
operations of the Excluded Businesses, Retained Sites, the Retained Companies
and the Seller Retained Employees; and (ii) the matters set forth on Schedule
A-14 of the Disclosure Letter.

 

“Retained Sites” shall mean (a) the Non-Operating Sites and (b) the Leased
Sites.

 

“Rockwood Pigmente Holding GmbH” shall mean Rockwood Pigmente Holding GmbH, a
Gesellschaft mit beschränkter Haftung organized under the laws of Germany and
registered with the commercial register (Handelsregister) at the local court
(Amtsgericht) of Wiesbaden under number HRB 17837.

 

“Rockwood Pigments” shall mean Rockwood Pigments NA, Inc., a Delaware
corporation.

 

“Rockwood Specialties GmbH” shall mean Rockwood Specialties GmbH, a Gesellschaft
mit beschränkter Haftung organized under the laws of Germany and registered with
the commercial register (Handelsregister) at the local court (Amtsgericht) of
Wiesbaden under number HRB 17839.

 

“Rockwood Specialties Limited” shall mean a limited company organized under the
laws of England and Wales with company number 04050394.

 

“RSGG” shall mean Rockwood Specialties Group GmbH, a Gesellschaft mit
beschränkter Haftung organized under the laws of Germany and registered with the
commercial register (Handelsregister) at the local court (Amtsgericht) of
Frankfurt am Main under number HRB 57924.

 

“RSG Enterprise Agreements” shall mean the Enterprise Agreements between
Rockwood Specialties GmbH as the controlling entity and each of Silo Pigmente
GmbH, Rockwood Pigmente Holding GmbH and Sachtleben Wasserchemie (Holding) GmbH
as the controlled entity.

 

“Sachtleben Agreements” shall mean the Bayer Land Use Agreement and the Currenta
Framework Agreement.

 

A-18

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“Sachtleben Chemie GmbH” shall mean Sachtleben Chemie GmbH, a Gesellschaft mit
beschränkter Haftung organized under the laws of Germany and registered with the
commercial register (Handelsregister) at the local court (Amtsgericht) of
Duisburg under number HRB 19669.

 

“Sachtleben Guarantees” shall mean the Bayer Guarantee and the Currenta
Guarantee.

 

“Sachtleben Enterprise Agreement” shall mean the Enterprise Agreement between
Sachtleben GmbH as the controlling entity and Sachtleben Chemie GmbH as the
controlled entity.

 

“Sachtleben GmbH” shall mean Sachtleben GmbH, a Gesellschaft mit beschränkter
Haftung organized under the laws of Germany and registered with the commercial
register (Handelsregister) at the local court (Amtsgericht) of Duisburg under
number HRB 20551.

 

“Sachtleben LLC” shall have the meaning specified in Section 1.4(a)(ii).

 

“Sachtleben Pigment GmbH” shall mean Sachtleben Pigment GmbH, a Gesellschaft mit
beschränkter Haftung organized under the laws of Germany and registered with the
commercial register (Handelsregister) at the local court (Amtsgericht) of
Duisburg under number HRB 24751.

 

“Sachtleben Pigments Oy” shall mean Sachtleben Pigments Oy, a limited company
(Osakeyhtiö) organized under the laws of Finland and registered with the
business ID 0948159-2.

 

“Sachtleben Wasserchemie (Holding) GmbH” shall mean Sachtleben Wasserchemie
(Holding) GmbH a Gesellschaft mit beschränkter Haftung organized under the laws
of Germany and registered with the commercial register (Handelsregister) at the
local court (Amtsgericht) of Frankfurt under number HRB 80726.

 

“Sachtleben Pigments Oy Pension Fund” shall mean Sachtleben Pigments Oy:n
Eläkesäätiö, organized under the laws of Finland and registered with the
business ID 1053485-8.

 

“Sec. 303 AktG Security” shall have the meaning specified in Section 4.12(b).

 

“Section 338(h)(10) Election” shall have the meaning specified in
Section 9.1(o)(i).

 

“Security Interest” shall mean any pledge, mortgage, deed of trust, security
interest or other lien, in each case to secure payment or performance of any
Indebtedness.

 

“Security Replacement” shall have the meaning specified in Section 4.12(c).

 

“Selected Accountant” shall have the meaning specified in Section 1.5(e).

 

“Selected Expert” shall have the meaning specified in Section 1.6(d).

 

“Seller Indemnitees” shall have the meaning specified in Section 8.3.

 

“Seller Marks” shall have the meaning specified in Section 4.6(a).

 

A-19

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“Seller Related Party” shall mean the Sellers, the Transferred Companies, and
each of their respective stockholders, partners, members, Affiliates, directors,
officers, employees, controlling persons and agents.

 

“Seller Retained Employee” shall have the meaning specified in Section 2.11(h).

 

“Seller Taxes” shall mean any and all Taxes, regardless of whether included in
any Schedule to the Disclosure Letter relating to Section 2.7 and even if such
Taxes become due after the Closing Date, (a) imposed on any Seller or any of its
direct or indirect owners; (b) imposed on a Transferred Company or a
Non-Controlled Company, or for which a Transferred Company or a Non-Controlled
Company may otherwise be liable, for any Pre-Closing Period and for the portion
of any Straddle Period ending on and including the Closing Date (determined in
accordance with Section 9.1(b)(ii)); (c) of any affiliated, combined,
consolidated, unitary or similar group with respect to any Taxes (or any member
thereof, other than a Transferred Company or a Non-Controlled Company) of which
a Transferred Company or a Non-Controlled Company (or any predecessor of a
Transferred Company or a Non-Controlled Company) is or was a member on or prior
to the Closing Date (other than a group consisting solely of one or more
Transferred Companies) by reason of Treasury Regulation Section 1.1502-6(a) or
any analogous or similar state or local or non-U.S. Legal Requirements; and
(d) arising under Section 1445 of the Code and the associated Treasury
Regulations as a result of the transactions contemplated by this Agreement;
provided, however, that no such Tax will constitute a Seller Tax to the extent
it was included as a current liability in the determination of the final Closing
Working Capital and Transfer Taxes described in Section 9.1(h) shall not
constitute Seller Taxes.  Notwithstanding the foregoing, (y) Seller Taxes
related to the Non-Controlled Companies shall be limited to Taxes attributable
to claims made by Governmental Authority prior to Closing with respect to which
Parent had Knowledge and shall be limited by reference to Parent’s percentage
ownership of the Non-Controlled Company and (z) Seller Taxes relating to Viance,
Viance Ltd. and Viance Oy shall be limited by reference to Parent’s percentage
ownership of Viance.

 

“Sellers” shall mean Parent, KL 2, Rockwood Specialties GmbH, Rockwood
Specialties Limited, Sachtleben GmbH, and the French Seller.

 

“Sellers’ Portion” shall mean, with respect to claims made within the specified
period after the Closing Date: (i) 80% during the first twelve (12) months;
(ii) 70% during the second twelve (12) months; (iii) 60% during the third twelve
(12) months; (iv) 50% during the fourth twelve (12) months; (v) 40% during the
fifth twelve (12) months; (vi) 30% during the sixth twelve (12) months; and
(vii) 20% during the seventh twelve (12) months.

 

“Shares” shall mean, with respect to a Company or a JV Entity, the Equity
Interests of such Company or JV Entity, as the case may be, owned or to be owned
as of the Closing Date by the applicable Seller as set forth on Schedule 2.2 of
the Disclosure Letter.

 

“Silo Pigmente GmbH” shall mean Silo Pigmente GmbH, a Gesellschaft mit
beschränkter Haftung organized under the laws of Germany and registered with the
commercial register (Handelsregister) at the local court (Amtsgericht) of
Wiesbaden under number HRB 17832.

 

A-20

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“Specified Representations” shall have the meaning specified in Section 8.1.

 

“Specified Sites” shall mean the Real Property located at (i) 1219 Old
Clyattville Road, Valdosta, Georgia 31601; (ii) 2001 and 2051 Lynch Avenue, East
St. Louis, Illinois 62204; and (iii) Alfred-Delp Strasse 57, Rotgau 5, 63110
Hainhausen, Hessen, Germany.

 

“Straddle Period” shall have the meaning specified in Section 9.1(b)(i).

 

“Subsidiary” shall mean, with respect to any Person, another Person of which
such Person, directly or indirectly through one or more Subsidiaries,
beneficially owns capital stock or other Equity Interests having in the
aggregate fifty percent (50%) or more of the total combined voting power,
without giving effect to any contingent voting rights, in the election of
directors (or Persons fulfilling similar functions or duties) of such owned
Person.

 

“Subsidiary Shares” shall mean, with respect to a Subsidiary of a Company, the
shares of capital stock, the issued shares or other Equity Interests of such
Subsidiary set forth on Schedule 2.2 of the Disclosure Letter.

 

“Take or Pay Agreement” shall have the meaning specified in
Section 2.10(a)(vii).

 

“Tax Allocation” shall have the meaning specified in Section 9.1(o)(ii).

 

“Tax Return” shall mean any return, report, form, disclosure or other
information filed with any Governmental Authority with respect to Taxes.

 

“Taxes” shall mean (i) all direct, indirect or ancillary taxes, charges, fees,
levies, unclaimed property and escheat obligations owed for pre-Closing periods
to the extent that neither such obligations nor the underlying Third-Party
Claims are reflected in the Final Closing Working Capital, or other assessments,
and all estimated payments thereof, including but not limited to income, excise,
license, severance, stamp, occupation, premium, profits, windfall, customs
duties, capital stock, employment, disability, registration, alternative or
add-on minimum, property, sales, use, value added, environmental (including
Taxes imposed under Section 59A of the Code), franchise, payroll, transfer,
gross receipts, withholding, social security or similar unemployment taxes, and
any other tax of any kind whatsoever, imposed by any Governmental Authority,
including any interest, penalties and additions to tax relating to such taxes,
charges, fees, levies or other assessments; (ii) any liability for the payment
of any amounts of the type described in clause (i) as a result of being a member
of any affiliated, combined, consolidated, unitary or similar group with respect
to any Taxes, including any affiliated group within the meaning of Section 1504
of the Code electing to file consolidated federal Income Tax returns and any
similar group under state or local or non-U.S. Legal Requirements, for any
period; and (iii) any liability for the payment of any amounts of the type
described in clauses (i) or (ii) as a transferee or successor, by contract, or
otherwise.

 

“Term” shave have them meaning specified in the Transition Services Agreement.

 

“Termination Date” shall have the meaning specified in Section 4.25(a).

 

A-21

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“Test Run” shall mean the production by the Augusta Plant in any period of 31
consecutive days of Product (x) that meets the specifications set forth on
Schedule A-3 of the Disclosure Letter and (y) in amounts specified in Schedule
A-15 of the Disclosure Letter.  The quantities specified in Schedule A-15 of the
Disclosure Letter are stipulated by Parent to be proportional to the annual
quantities of the six highest volume products that are expected to be
manufactured at the Augusta Facility in the coming twelve (12) months.  Further,
for the Test Run to be deemed successful, during the Test Run, the Augusta
Facility shall (a) be operating safely and in accordance with all applicable
Legal Requirements, codes and standards, (b) use the types and grades and
quantities of raw materials, utilities and consumables that would normally be
used by the Augusta Facility on a going-forward basis to produce Product.

 

“Third-Party Claim” shall have the meaning specified in Section 8.6(a).

 

“Third-Party Indebtedness” shall mean any Indebtedness that is not Intercompany
Indebtedness.

 

“Threshold Amount” shall have the meaning specified in Section 8.4(d).

 

“Timber Treatment Business” shall mean the business of producing, manufacturing,
marketing, developing and selling timber treatment preservative chemicals used
in wood protection products and inorganic chemicals based in zinc, manganese,
magnesium and calcium used in industrial applications, such as cement,
fertilizer and micronutrients.  The term “Timber Treatment Business” shall
exclude the European Timber Treatment Business.

 

“Transaction Bonuses” shall have the meaning specified in Section 9.3(c).

 

“Transferred Companies” shall have the meaning specified in Section 2.1.

 

“Transferred Company Benefit Plans” shall have the meaning specified in
Section 2.12(a).

 

“Transferred Company Indebtedness” shall mean the aggregate amount, without
duplication, of Indebtedness of each of the Transferred Companies as of the
Closing Date owing to any other Person, other than to one or more Transferred
Companies, determined as of 12:01 a.m. (Eastern Time) on the Closing Date (and
after giving effect to the transactions contemplated hereby) plus any accrued
and unpaid interest thereon.  In determining Transferred Company Indebtedness,
foreign currencies shall be converted into Dollars at the exchange rates as of
the date of the Estimated Closing Statement.

 

“Transition Services” shave have them meaning specified in the Transition
Services Agreement.

 

“Transition Services Agreement” shall have the meaning specified in
Section 1.4(a)(xvi).

 

“Transfer Taxes” shall have the meaning specified in Section 9.1(h).

 

“U.C.C.” shall mean the Uniform Commercial Code, as amended, and any successor
thereto.

 

A-22

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“U.K. Company” shall mean Creambay Limited, a limited company incorporated under
the laws of England and Wales with company number 04050413.

 

“U.K. Retirement Plan” shall mean the Rockwood U.K. Retirement Plan.

 

“U.K. Shares” shall mean the shares of capital stock or other Equity Interests
of the U.K. Company’s set forth on Schedule 2.2 of the Disclosure Letter.

 

“U.S.” shall mean the United States of America.

 

“U.S. Business Employees” shall mean those Business Employees employed and/or
engaged in the portion of the Business conducted in the U.S.

 

“U.S. Continuation Period” shall have the meaning specified in Section 9.4(a).

 

“U.S. Transferred Companies” shall mean Rockwood Pigments, CSI and Sachtleben
LLC.

 

“VAT” shall mean Value Added Tax as stipulated by European Council Directive
2006/112/EC of 28 November 2006 and the respective national VAT Acts.

 

“Viance” shall mean Viance, LLC, a Delaware limited liability company.

 

“WARN Act” shall have the meaning specified in Section 2.11(i).

 

“Willful Breach” shall mean a breach, inaccuracy or failure to comply with any
representation or warranty or any failure to comply with any covenant or
agreement contained in the Agreement that is a consequence of an action taken by
the breaching party with the actual knowledge, or by such party grossly
negligently failing to know, that the taking of such action would constitute a
breach, inaccuracy or failure to comply.

 

“Working Capital” shall mean, with respect to the Business, (i) the value of the
current assets of the categories described on Schedule A-16 of the Disclosure
Letter of the Business, excluding all Tax assets other than VAT; minus (ii) the
value of the current liabilities of the categories described on Schedule A-16 of
the Disclosure Letter of the Business, in each case, determined in accordance
with GAAP applied on a basis consistent with the application of such principles
in the preparation of the Balance Sheet; minus (iii) the Company Transaction
Expenses.  In determining “Working Capital”, (A) foreign currencies shall be
converted into Dollars at the exchange rates as of the date of the Estimated
Closing Statement, and (B) items included in the Augusta Construction Cost and
Augusta Qualified Cost shall be disregarded.

 

A-23

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EXHIBIT B
List of Companies

 

1.                                      Creambay Limited, a limited company
organized under the laws of England and Wales

 

2.                                      Sachtleben Chemie GmbH, a Gesellschaft
mit beschränkter Haftung organized under the laws of Germany

 

3.                                      Sachtleben LLC, a Delaware limited
liability company

 

4.                                      Rockwood Pigmente Holding GmbH, a
Gesellschaft mit beschränkter Haftung organized under the laws of Germany

 

5.                                      Rockwood Italia S.p.A., a Società per
Azioni organized under the laws of Italy

 

6.                                      Holliday Pigments International S.A.S.,
a Société par actions simplifiée organized under the laws of France

 

7.                                      Holliday Pigments S.A.S., a Société par
actions simplifiée organized under the laws of France

 

8.                                      Holliday France S.A.S., a Société par
actions simplifiée organized under the laws of France

 

9.                                      Holliday Chemical España, S.A., a
sociedad anónima organized under the laws of Spain

 

10.                               Rockwood Far East Limited, a limited company
organized under the laws of Hong Kong

 

11.                               Silo Pigmente GmbH, a Gesellschaft mit
beschränkter Haftung organized under the laws of Germany

 

12.                               Sachtleben Wasserchemie (Holding) GmbH, a
Gesellschaft mit beschränkter Haftung organized under the laws of Germany

 

13.                               Rockwood Pigments NA, Inc., a Delaware
corporation

 

14.                               Chemical Specialties, Inc., a North Carolina
corporation

 

B-1

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EXHIBIT C
List of JV Entities

 

1.                                      Nuodex Italiana S.r.L., a Società a
Responsabilità Limitata organized under the laws of Italy

2.                                      Nuodex Mexicana S.A. des C.V., a
Sociedad Anónima de Capital Variable organized under the laws of Mexico

 

C-1

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