Exhibit 10.5

RECEIVABLES SALE AND CONTRIBUTION AGREEMENT

DATED AS OF MARCH 13, 2008

BETWEEN

INTERNATIONAL PAPER COMPANY,

AS ORIGINATOR

AND

RED BIRD RECEIVABLES, LLC,

AS BUYER

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ARTICLE I AMOUNTS AND TERMS OF THE PURCHASE

   1 Section 1.1    [Intentionally Deleted]    1 Section 1.2    Purchase of
Receivables.    1 Section 1.3    Payment for the Purchase    3 Section 1.4   
Purchase Price Credit Adjustments    4 Section 1.5    Payments and Computations,
Etc.    5 Section 1.6    Transfer of Records    5 Section 1.7   
Characterization    5 ARTICLE II REPRESENTATIONS AND WARRANTIES    6 Section 2.1
   Representations and Warranties of IPCO    6 ARTICLE III CONDITIONS OF
PURCHASE    10 Section 3.1    Conditions Precedent to Purchase    10 Section 3.2
   Conditions Precedent to Subsequent Payments    10 ARTICLE IV COVENANTS    10
Section 4.1    Affirmative Covenants of IPCO    10 Section 4.2    Negative
Covenants of IPCO.    14 ARTICLE V TERMINATION EVENTS    15 Section 5.1   
Termination Events    15 Section 5.2    Remedies    16 ARTICLE VI
INDEMNIFICATION    17 Section 6.1    Indemnities by IPCO    17 Section 6.2   
Other Costs and Expenses    19

 

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ARTICLE VII MISCELLANEOUS    20 Section 7.1    Waivers and Amendments.    20
Section 7.2    Notices    20 Section 7.3    Protection of Ownership Interests of
Buyer.    20 Section 7.4    Confidentiality    21 Section 7.5    Bankruptcy
Petition.    22 Section 7.6    Limitation of Liability    23 Section 7.7   
CHOICE OF LAW    23 Section 7.8    CONSENT TO JURISDICTION    23 Section 7.9   
WAIVER OF JURY TRIAL    23 Section 7.10    Integration; Binding Effect; Survival
of Terms.    24 Section 7.11    Counterparts; Severability; Section References
   24 Section 7.12    Payment Recission    25

 

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EXHIBITS AND SCHEDULES

 

Exhibit I    -      Definitions Exhibit II    -      Principal Place of
Business; Location(s) of Records; Federal Employer Identification Number; Other
Names Exhibit III    -      Lock Boxes; Collection Accounts; Collection Banks
Exhibit IV    -      Form of Compliance Certificate Exhibit V    -      Copy of
Credit and Collection Policy Exhibit VI    -      Form of Subordinated Note
Exhibit VII         Form of Purchase Report Schedule A         List of Documents
to Be Delivered to Buyer Prior to the Purchase Schedule B         Receivables
Created by Domestic Sales of Certain Businesses

 

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RECEIVABLES SALE AND CONTRIBUTION AGREEMENT

THIS RECEIVABLES SALE AND CONTRIBUTION AGREEMENT, dated as of March 13, 2008, is
by and between INTERNATIONAL PAPER COMPANY, a New York corporation (“IPCO”), and
RED BIRD RECEIVABLES, LLC, a Delaware limited liability company formerly known
as Red Bird Receivables, Inc. (“Buyer”). Unless defined elsewhere herein,
capitalized terms used in this Agreement shall have the meanings assigned to
such terms in Exhibit I hereto (or, if not defined in Exhibit I hereto, the
meaning assigned to such term in Exhibit I to the Credit and Security
Agreement).

PRELIMINARY STATEMENTS

IPCO now owns, and from time to time hereafter will own, Receivables. IPCO
wishes to sell and assign to Buyer, and Buyer wishes to purchase from IPCO, all
of IPCO’s right, title and interest in and to such Receivables, together with
the Related Security and Collections with respect thereto.

IPCO and Buyer intend the transactions contemplated hereby to be true sales of
the Receivables from IPCO to Buyer, providing Buyer with the full benefits of
ownership of the Receivables, and IPCO and Buyer do not intend these
transactions to be, or for any purpose to be characterized as, loans from Buyer
to IPCO.

Buyer may finance its purchases hereunder by borrowing and pledging its assets
pursuant to that certain Second Amended and Restated Credit and Security
Agreement dated as of March 13, 2008 (as the same may from time to time
hereafter be amended, supplemented, restated or otherwise modified, the “Credit
and Security Agreement”) among the Buyer, as Borrower, IPCO, as Servicer,
various lenders (“Lenders”) and co-agents (“Co-Agents”) from time to time party
thereto, and Citicorp North America, Inc., as administrative agent or any
successor administrative agent appointed pursuant to the terms of the Credit and
Security Agreement (in such capacity, the “Administrative Agent,” and together
with the Co-Agents, the “Agents”).

NOW, THEREFORE, in consideration of the foregoing premises and the mutual
agreements herein contained and other good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, the parties hereto agree
as follows:

ARTICLE I

AMOUNTS AND TERMS OF THE PURCHASE

Section 1.1 [Intentionally Deleted].

Section 1.2 Purchase of Receivables.

(a) Effective on the date hereof, in consideration for the Purchase Price and
upon the terms and subject to the conditions set forth herein, IPCO does hereby
sell, assign,

 

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transfer, set-over and otherwise convey to Buyer, without recourse (except to
the extent expressly provided herein), and Buyer does hereby purchase from IPCO,
all of IPCO’s right, title and interest in and to all Receivables existing as of
the close of business on the date hereof and all Receivables thereafter arising
through and including the Termination Date, together, in each case, with all
Related Security relating thereto and all Collections thereof. In accordance
with the preceding sentence, on the date hereof Buyer shall acquire all of
IPCO’s right, title and interest in and to all Receivables existing as of the
date hereof and thereafter arising through and including the Termination Date,
together with all Related Security relating thereto and all Collections thereof.
Buyer shall be obligated to pay the Purchase Price for the Receivables purchased
hereunder in accordance with Section 1.3.

(b) On the 12th day of each month hereafter (or if any such day is not a
Business Day, on the next succeeding Business Day thereafter, IPCO shall deliver
to Buyer a report in substantially the form of Exhibit VII hereto (each such
report being herein called a “Purchase Report”) with respect to the Receivables
sold by IPCO to Buyer during the Settlement Period then most recently ended. In
addition to, and not in limitation of, the foregoing, in connection with the
payment of the Purchase Price for any Receivables purchased hereunder, Buyer may
request that IPCO deliver, and IPCO shall deliver, such approvals, opinions,
information or documents as Buyer may reasonably request.

(c) It is the intention of the parties hereto that the Purchase of Receivables
made hereunder shall constitute a sale, which sale is absolute and irrevocable
and provides Buyer with the full benefits of ownership of the Receivables.
Except for the Purchase Price Credits owed pursuant to Section 1.4, the sale of
Receivables hereunder is made without recourse to IPCO; provided, however, that
(i) IPCO shall be liable to Buyer for all representations, warranties, covenants
and indemnities made by IPCO pursuant to the terms of the Transaction Documents
to which IPCO is a party, and (ii) such sale does not constitute and is not
intended to result in an assumption by Buyer or any assignee thereof of any
obligation of IPCO or any other Person arising in connection with the
Receivables, the related Contracts and/or other Related Security or any other
obligations of IPCO. In view of the intention of the parties hereto that the
Purchase of Receivables made hereunder shall constitute a sale of such
Receivables rather than loans secured thereby, IPCO agrees that it will, on or
prior to the date hereof and in accordance with Section 4.1(e)(ii), mark its
master data processing records relating to the Receivables with a legend
acceptable to Buyer and to the Administrative Agent (as Buyer’s assignee),
evidencing that Buyer has purchased such Receivables as provided in this
Agreement and to note in its financial statements that its Receivables have been
sold to Buyer. Upon the request of Buyer or the Administrative Agent (as Buyer’s
assignee), IPCO will execute and file such financing or continuation statements,
or amendments thereto or assignments thereof, and such other instruments or
notices, as may be necessary or appropriate to perfect and maintain the
perfection of Buyer’s ownership interest in the Receivables and the Related
Security and Collections with respect thereto, or as Buyer or the Administrative
Agent (as Buyer’s assignee) may reasonably request.

 

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Section 1.3 Payment for the Purchase.

(a) The Purchase Price for the Purchase of Receivables in existence as of the
close of business on the date hereof shall be payable in full by Buyer to IPCO
on the date hereof, and shall be paid to IPCO in the following manner:

(i) by delivery of immediately available funds, to the extent of funds made
available to Buyer from its borrowings under the Credit and Security Agreement,
and

(ii) the balance, by delivery of the proceeds of a subordinated revolving loan
from IPCO to Buyer (a “Subordinated Loan”) in an amount not to exceed the least
of (A) the remaining unpaid portion of such Purchase Price, (B) the maximum
Subordinated Loan that could be borrowed without rendering Buyer’s Net Worth
less than the Required Capital Amount, and (C) fifteen percent (15%) of such
Purchase Price. IPCO is hereby authorized by Buyer to endorse on the schedule
attached to the Subordinated Note an appropriate notation evidencing the date
and amount of each advance thereunder, as well as the date of each payment with
respect thereto, provided that the failure to make such notation shall not
affect any obligation of Buyer thereunder.

The Purchase Price for each Receivable coming into existence after the date
hereof shall be due and owing in full by Buyer to IPCO or its designee on the
date each such Receivable came into existence (except that Buyer may, with
respect to any such Purchase Price, offset against such Purchase Price any
amounts owed by IPCO to Buyer hereunder and which have become due but remain
unpaid) and shall be paid to IPCO in the manner provided in the following
paragraphs (b), (c) and (d).

(b) With respect to any Receivables coming into existence after the date hereof,
on each Settlement Date, Buyer shall pay the Purchase Price therefor in
accordance with Section 1.3(d) and in the following manner:

first, by delivery of immediately available funds, to the extent of funds
available to Buyer from its borrowing, and pledge, of an interest in the
Receivables to, the Administrative Agent for the benefit of the Lenders under
the Credit and Security Agreement or other cash on hand;

second, by delivery of the proceeds of a Subordinated Loan, provided that the
making of any such Subordinated Loan shall be subject to the provisions set
forth in Section 1.3(a)(ii); and

third, unless IPCO or Buyer has declared the Termination Date to have occurred
pursuant to this Agreement, by accepting a contribution to its capital in an
amount equal to the remaining unpaid balance of such Purchase Price.

Subject to the limitations set forth in Section 1.3(a)(ii), IPCO irrevocably
agrees to advance each Subordinated Loan requested by Buyer on or prior to the
Termination Date. The Subordinated Loans shall be evidenced by, and shall be
payable in accordance with the terms and provisions of

 

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the Subordinated Note and shall be payable solely from funds which Buyer is not
required under the Credit and Security Agreement to set aside for the benefit
of, or otherwise pay over to, the Lenders.

(c) From and after the Termination Date, IPCO shall not be obligated to (but
may, at its option): (i) sell Receivables to Buyer, or (ii) contribute
Receivables to Buyer’s capital pursuant to clause third of Section 1.3(b) unless
IPCO reasonably determines that the Purchase Price therefor will be satisfied
with funds available to Buyer from sales of interests in the Receivables
pursuant to the Credit and Security Agreement, Collections, proceeds of
Subordinated Loans, other cash on hand or otherwise.

(d) Although the Purchase Price for each Receivable coming into existence after
the date hereof shall be due and payable in full by Buyer to IPCO on the date
such Receivable came into existence, settlement of the Purchase Price between
Buyer and IPCO shall be effected on a monthly basis on Settlement Dates with
respect to all Receivables coming into existence during the same Calculation
Period and based on the information contained in the Purchase Report delivered
by IPCO for the Calculation Period then most recently ended. Although settlement
shall be effected on Settlement Dates, increases or decreases in the amount
owing under the Subordinated Note made pursuant to Section 1.3 and any
contribution of capital by IPCO to Buyer made pursuant to Section 1.3(b) shall
be deemed to have occurred and shall be effective as of the last Business Day of
the Calculation Period to which such settlement relates.

Section 1.4 Purchase Price Credit Adjustments. If on any day:

(a) the Outstanding Balance of a Receivable is:

(i) reduced as a result of any defective or rejected or returned goods or
services, any discount or any adjustment or otherwise by IPCO (other than as a
result of such Receivable becoming a Defaulted Receivable or to reflect cash
Collections on account of such Receivable),

(ii) reduced or canceled as a result of a setoff in respect of any claim by any
Person (whether such claim arises out of the same or a related transaction or an
unrelated transaction), or

(b) any of the representations and warranties set forth in Sections 2.1(i), (j),
(l), (q)(ii), (r), (s) or (t) hereof are not true when made or deemed made with
respect to any Receivable,

then, in such event, Buyer shall be entitled to a credit (each, a “Purchase
Price Credit”) against the Purchase Price otherwise payable hereunder equal to
the Outstanding Balance of such Receivable (calculated before giving effect to
the applicable reduction or cancellation). If such Purchase Price Credit exceeds
the Original Balance of the Receivables coming into existence on any day, then
IPCO shall pay the remaining amount of such Purchase Price Credit in cash
immediately, provided that if the Termination Date has not occurred, IPCO shall
be allowed to deduct the remaining amount of such Purchase Price Credit from any
indebtedness owed to it under the Subordinated Note.

 

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Section 1.5 Payments and Computations, Etc. All amounts to be paid or deposited
by Buyer hereunder shall be paid or deposited in accordance with the terms
hereof on the day when due in immediately available funds to the account of IPCO
designated from time to time by IPCO or as otherwise directed by IPCO. In the
event that any payment owed by any Person hereunder becomes due on a day that is
not a Business Day, then such payment shall be made on the next succeeding
Business Day. If any Person fails to pay any amount hereunder when due, such
Person agrees to pay, on demand, the Default Fee in respect thereof until paid
in full; provided, however, that such Default Fee shall not at any time exceed
the maximum rate permitted by applicable law. All computations of interest
payable hereunder shall be made on the basis of a year of 360 days for the
actual number of days (including the first but excluding the last day) elapsed.

Section 1.6 Transfer of Records.

(a) In connection with the Purchase of Receivables hereunder, IPCO hereby sells,
transfers, assigns and otherwise conveys to Buyer all of IPCO’s right and title
to and interest in the Records relating to all Receivables sold or contributed
hereunder, without the need for any further documentation in connection with the
Purchase. In connection with such transfer, IPCO hereby grants to each of Buyer,
the Administrative Agent and each Person who succeeds IPCO as Servicer an
irrevocable, non-exclusive license to use, without royalty or payment of any
kind, all software used by IPCO to account for the Receivables, to the extent
necessary to administer the Receivables, whether such software is owned by IPCO
or is owned by others and used by IPCO under license agreements with respect
thereto, provided that should the consent of any licensor of such software be
required for the grant of the license described herein, to be effective, IPCO
hereby agrees that upon the request of Buyer (or Buyer’s assignee), IPCO will
use its reasonable efforts to obtain the consent of such third-party licensor.
The license granted hereby shall be irrevocable until the indefeasible payment
in full of the Obligations, and shall terminate on the date this Agreement
terminates in accordance with its terms.

(b) IPCO (i) shall take such action requested by Buyer and/or the Administrative
Agent (as Buyer’s assignee), from time to time hereafter, that may be necessary
or appropriate to ensure that Buyer and its assigns under the Credit and
Security Agreement have an enforceable ownership interest in the Records
relating to the Receivables purchased from IPCO hereunder, and (ii) shall use
its reasonable efforts to ensure that Buyer, the Administrative Agent and the
Servicer (if other than IPCO) each has an enforceable right (whether by license
or sublicense or otherwise) to use all of the computer software used to account
for the Receivables and/or to recreate such Records.

Section 1.7 Characterization. If, notwithstanding the intention of the parties
expressed in Section 1.2(c), any sale or contribution by IPCO to Buyer of
Receivables hereunder shall be characterized as a secured loan and not a sale or
such sale shall for any reason be ineffective or unenforceable, then this
Agreement shall be deemed to constitute a security agreement under the UCC and
other applicable law. For this purpose and without being in derogation of the
parties’ intention that the sale of Receivables hereunder shall constitute a
true sale thereof, IPCO hereby grants to Buyer a duly perfected security
interest in all of IPCO’s right, title and interest in, to and under all
Receivables now existing and hereafter arising, all Collections and Related

 

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Security with respect thereto, each Lock Box and Collection Account, all other
rights and payments relating to the Receivables and all proceeds of the
foregoing to secure the prompt and complete payment of a loan deemed to have
been made in an amount equal to the Purchase Price of the Receivables together
with all other obligations of IPCO hereunder (collectively, the “IPCO
Collateral”), which security interest shall be prior to all other Adverse Claims
thereto. Buyer and its assigns shall have, in addition to the rights and
remedies which they may have under this Agreement, all other rights and remedies
provided to a secured creditor under the UCC and other applicable law, which
rights and remedies shall be cumulative.

ARTICLE II

REPRESENTATIONS AND WARRANTIES

Section 2.1 Representations and Warranties of IPCO. IPCO hereby represents and
warrants to Buyer on the date hereof, on the date of the Purchase and on each
date that any Receivable comes into existence that:

(a) Existence and Power. IPCO is a corporation duly organized under the laws of
New York, and no other state or jurisdiction. IPCO is validly existing and in
good standing under the laws of New York and is duly qualified to do business
and is in good standing as a foreign entity, and has and holds all corporate
power and all governmental licenses, authorizations, consents and approvals
required to carry on its business in each jurisdiction in which its business is
conducted except where the failure to so qualify or so hold could not reasonably
be expected to have a Material Adverse Effect.

(b) Power and Authority; Due Authorization, Execution and Delivery. The
execution and delivery by IPCO of this Agreement and each other Transaction
Document to which it is a party, and the performance of its obligations
hereunder and thereunder and, IPCO’s use of the proceeds of the Purchase made
hereunder, are within its corporate powers and authority and have been duly
authorized by all necessary corporate action on its part. This Agreement and
each other Transaction Document to which IPCO is a party has been duly executed
and delivered by IPCO.

(c) No Conflict. The execution and delivery by IPCO of this Agreement and each
other Transaction Document to which it is a party, and the performance of its
obligations hereunder and thereunder (i) do not contravene or violate (A) its
Organizational Documents, (B) any law, rule or regulation applicable to it,
(C) any restrictions under any agreement, contract or instrument to which it is
a party or by which it or any of its property is bound, or (D) any order, writ,
judgment, award, injunction or decree binding on or affecting it or its
property, and (ii) do not result in the creation or imposition of any Adverse
Claim on assets of IPCO or its Material Subsidiaries (except as created
hereunder) except, in the case of clauses (i)(B), (i)(C) and (i)(D) above where
such contravention or violation could not reasonably be expected to have a
Material Adverse Effect; and no transaction contemplated hereby requires
compliance with any bulk sales act or similar law.

(d) Governmental Authorization. Other than the filing of the financing
statements required hereunder, no authorization or approval or other action by,
and no notice to

 

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or filing with, any governmental authority or regulatory body is required for
the due execution and delivery by IPCO of this Agreement or any other
Transaction Document to which it is a party and the performance of its
obligations hereunder and thereunder.

(e) Actions, Suits. Except as set forth in IPCO’s filings with the Securities
and Exchange Commission, there are no actions, suits or proceedings pending, or
to the best of IPCO’s knowledge, threatened, against or affecting IPCO, or any
of its properties, in or before any court, arbitrator or other body, that could
reasonably be expected to have a Material Adverse Effect. IPCO is not in default
with respect to any order of any court, arbitrator or governmental body that
could reasonably be expected to have a Material Adverse Effect.

(f) Binding Effect. This Agreement and each other Transaction Document to which
IPCO is a party constitute the legal, valid and binding obligations of IPCO
enforceable against IPCO in accordance with their respective terms, except as
such enforcement may be limited by applicable bankruptcy, insolvency,
reorganization or other similar laws relating to or limiting creditors’ rights
generally and by general principles of equity (regardless of whether enforcement
is sought in a proceeding in equity or at law).

(g) Accuracy of Information.

(i) Pre-Closing Information. All information regarding the Receivables and
Related Security or IPCO furnished by IPCO or any of its Affiliates to the Buyer
(or its assigns) prior to the date of this Agreement was true and accurate in
every material respect on the date such information was so furnished except as
otherwise disclosed to the Buyer (or its assigns) prior to the date hereof and,
when taken as a whole together with such subsequent disclosures, did not contain
any material misstatement of fact or omit to state a material fact or any fact
necessary to make the statements contained therein not misleading.

(ii) Ongoing Information. All other information regarding the Receivables and
Related Security not covered by clause (i) above which is hereafter furnished by
IPCO to the Buyer (or its assigns) will be true and accurate in every material
respect on the date such information is so furnished and, when taken as a whole,
will not contain any material misstatement of fact or omit to state a material
fact or any fact necessary to make the statements contained therein not
misleading as of the date when so furnished.

(iii) Other Information. All other information regarding IPCO, its business,
operations, financial condition or prospects furnished by IPCO to the Buyer (or
its assigns) in connection with the Transaction Documents after the date of this
Agreement that is not covered by clauses (i) or (ii) above, will be true and
accurate in every material respect on the date such information is so furnished
and, when taken as a whole together with any subsequent updates to such
information, will not contain any material misstatement of fact or omit to state
a material fact or any fact necessary to make the statements contained therein
not misleading as of the date when furnished or updated.

 

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(h) Use of Proceeds. No portion of any Purchase Price payment hereunder will be
used to acquire any security in any transaction which is subject to Section 12,
13 or 14 of the Securities Exchange Act of 1934, as amended; provided, however,
that Originator may use Purchase Price payments hereunder to repurchase shares
of its capital stock in accordance with applicable laws and regulations.

(i) Good Title. Immediately prior to the Purchase hereunder and upon the
creation of each Receivable coming into existence after the date hereof, IPCO
(i) is the legal and beneficial owner of the Receivables and (ii) is the legal
and beneficial owner of the Related Security with respect thereto or possesses a
valid and perfected security interest therein, in each case, free and clear of
any Adverse Claim, except as created by the Transaction Documents. There have
been duly filed all financing statements or other similar instruments or
documents necessary under the UCC (or any comparable law) of all appropriate
jurisdictions to perfect IPCO’s ownership interest in each Receivable, its
Collections and the Related Security.

(j) Perfection. This Agreement, together with the filing of the financing
statements contemplated hereby, is effective to transfer to Buyer (and Buyer
shall acquire from IPCO) (i) legal and equitable title to, with the right to
sell and encumber each Receivable existing and hereafter arising, together with
the Collections with respect thereto, and (ii) all of IPCO’s right, title and
interest in the Related Security associated with each Receivable, in each case,
free and clear of any Adverse Claim, except as created by the Transactions
Documents. There have been duly filed all financing statements or other similar
instruments or documents necessary under the UCC (or any comparable law) of all
appropriate jurisdictions to perfect Buyer’s ownership interest in the
Receivables, the Related Security and the Collections.

(k) Places of Business and Locations of Records. The principal places of
business and chief executive office of IPCO and the offices where it keeps all
of its Records are located at the address(es) listed on Exhibit II or such other
locations of which Buyer has been notified in accordance with Section 4.2(a) in
jurisdictions where all action required by Section 4.2(a) has been taken and
completed. IPCO’s Federal Employer Identification Number is correctly set forth
on Exhibit II.

(l) Collections. The conditions and requirements set forth in Section 4.1(j)
have at all times been satisfied and duly performed. The names and addresses of
all Collection Banks, together with the account numbers of the Collection
Accounts at each Collection Bank and the post office box number of each Lock
Box, are listed on Exhibit III. IPCO has not granted any Person, other than
Buyer (and its assigns) dominion and control of any Lock Box or Collection
Account, or the right to take dominion and control of any such Lock Box or
Collection Account at a future time or upon the occurrence of a future event.

(m) Material Adverse Effect. Since December 31, 2006, and, for any date this
representation and warranty is made or deemed made after delivery of annual
audited financing statements pursuant to 4.1(a) hereof, the date of the most
recently delivered annual audited financial statements delivered thereunder, no
event has occurred that would have a Material Adverse Effect.

 

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(n) Names. The name in which IPCO has executed this Agreement is identical to
the name of IPCO as indicated on the public record of its state of organization
which shows IPCO to have been organized. In the past five (5) years, IPCO has
not used any corporate names, trade names or assumed names other than the name
in which it has executed this Agreement and as listed on Exhibit II.

(o) Ownership of Buyer. IPCO owns, directly or indirectly, 100% of the issued
and outstanding equity interests of Buyer, free and clear of any Adverse Claim.
Such equity interests are validly issued, fully paid and nonassessable, and
there are no options, warrants or other rights to acquire securities of Buyer.

(p) Not an Investment Company. IPCO is not an “investment company” within the
meaning of the Investment Company Act of 1940, as amended, or any successor
statute.

(q) Compliance with Law. (i) IPCO has complied in all respects with all
applicable laws, rules, regulations, orders, writs, judgments, injunctions,
decrees or awards to which it is subject, except where the failure to so comply
could not reasonably be expected to have a Material Adverse Effect, and
(ii) each Receivable, together with any Contract related thereto, does not
contravene any laws, rules or regulations applicable thereto (including, without
limitation, laws, rules and regulations relating to truth in lending, fair
credit billing, fair credit reporting, equal credit opportunity, fair debt
collection practices and privacy), except where such contravention or violation
could not reasonably be expected to have a Material Adverse Effect.

(r) Compliance with Credit and Collection Policy. IPCO has complied in all
material respects with the Credit and Collection Policy with regard to each
Receivable and the related Contract, and has not made any change to such Credit
and Collection Policy, except such material change as to which Buyer (or its
assigns) has been notified in accordance with Section 4.1(a)(vii).

(s) Payments to IPCO. With respect to each Receivable transferred to Buyer
hereunder, the Purchase Price received by IPCO constitutes reasonably equivalent
value in consideration therefor and such transfer was not made for or on account
of an antecedent debt. No transfer by IPCO of any Receivable hereunder is or may
be voidable under any section of the Bankruptcy Reform Act of 1978 (11 U.S.C. §§
101 et seq.), as amended.

(t) Eligible Receivables. Each Receivable reflected in any Purchase Report as an
Eligible Receivable was an Eligible Receivable on the date of its acquisition by
Buyer hereunder.

(u) Accounting. The manner in which IPCO accounts for the transactions
contemplated by this Agreement does not jeopardize the characterization of the
transactions contemplated herein as being true sales.

 

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ARTICLE III

CONDITIONS OF PURCHASE

Section 3.1 Conditions Precedent to Purchase. The Purchase under this Agreement
is subject to the conditions precedent that (a) Buyer shall have converted from
a Delaware corporation to a Delaware limited liability company, (b) 100% of
Buyer’s equity interests shall be owned directly by IPCO, (c) Buyer shall have
received on or before the date of such purchase those documents listed on
Schedule A and (d) all of the conditions to Amendment No. 4 to the Credit and
Security Agreement shall have been satisfied or waived in accordance with the
terms thereof.

Section 3.2 Conditions Precedent to Subsequent Payments. Buyer’s obligation to
pay for Receivables coming into existence after the date hereof shall be subject
to the further conditions precedent that: (a) the Facility Termination Date
shall not have occurred under the Credit and Security Agreement; (b) Buyer (or
its assigns) shall have received such other approvals, opinions or documents as
it may reasonably request and (c) on the date such Receivable came into
existence, the following statements shall be true (and acceptance of the
proceeds of any payment for such Receivable shall be deemed a representation and
warranty by IPCO that such statements are then true):

(i) the representations and warranties set forth in Article II are true and
correct on and as of the date such Receivable came into existence as though made
on and as of such date; and

(ii) no event has occurred and is continuing that will constitute a Termination
Event or an Unmatured Termination Event.

Notwithstanding the foregoing conditions precedent, upon payment of the Purchase
Price for any Receivable (whether by payment of cash, through an increase in the
amounts outstanding under the Subordinated Note, by offset of amounts owed to
Buyer and/or by offset of capital contributions), title to such Receivable and
the Related Security and Collections with respect thereto shall vest in Buyer,
whether or not the conditions precedent to Buyer’s obligation to pay for such
Receivable were in fact satisfied. The failure of IPCO to satisfy any of the
foregoing conditions precedent, however, shall give rise to a right of Buyer to
rescind the related purchase and direct IPCO to pay to Buyer an amount equal to
the Purchase Price payment that shall have been made with respect to any
Receivables related thereto.

ARTICLE IV

COVENANTS

Section 4.1 Affirmative Covenants of IPCO. Until the date on which this
Agreement terminates in accordance with its terms, IPCO hereby covenants as set
forth below:

(a) Financial Reporting. IPCO will maintain, for itself and each of its domestic
Subsidiaries, a system of accounting established and administered in accordance
with GAAP, and furnish to Buyer (or its assigns):

(i) Annual Reporting. Within 100 days after the close of each of its respective
fiscal years, unaudited, unqualified financial statements (which shall include
balance sheets, statements of income and retained earnings and a statement of
cash flows) for IPCO for such fiscal year certified by a senior financial
officer.

 

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(ii) Quarterly Reporting. Within 55 days after the close of the first three
(3) quarterly periods of each of its respective fiscal years, balance sheets of
IPCO as at the close of each such period and statements of income and retained
earnings and a statement of cash flows for IPCO for the period from the
beginning of such fiscal year to the end of such quarter, all certified by a
senior financial officer.

(iii) Compliance Certificate. Together with the financial statements required
hereunder, a compliance certificate in substantially the form of Exhibit IV
signed by IPCO’s Authorized Officer and dated the date of such annual financial
statement or such quarterly financial statement, as the case may be.

(iv) S.E.C. Filings. Promptly upon the filing thereof, copies of all
registration statements and reports on form 10-K, 10-Q, 8-K or successor forms,
which IPCO or any of its Subsidiaries files with the Securities and Exchange
Commission.

(v) Copies of Notices. Promptly upon its receipt of any notice, request for
consent, financial statements, certification, report or other material
communication under or in connection with any Transaction Document from any
Person other than Buyer or the Administrative Agent, copies of the same.

(vi) Change in Credit and Collection Policy. At least thirty (30) days prior to
the effectiveness of any material change in or material amendment to the Credit
and Collection Policy, a copy of the Credit and Collection Policy then in effect
and a notice (A) indicating such proposed change or amendment, and (B) if such
proposed change or amendment would be reasonably likely to adversely affect the
collectibility of the Receivables or decrease the credit quality of any newly
created Receivables, requesting Buyer’s (and the Administrative Agent’s, as
Buyer’s assignee) consent thereto.

(vii) Other Information. Promptly, from time to time, (A) such other
information, documents, records or data relating to the Receivables or (B) such
other information, documents, records or data relating to the condition or
operations, financial or otherwise, of IPCO each as Buyer (or its assigns) may
from time to time reasonably request in order to protect the interests of Buyer
(and its assigns) under or as contemplated by this Agreement.

(b) Notices. IPCO will notify Buyer (or its assigns) in writing of any of the
following as soon as possible upon learning of the occurrence thereof with
respect to IPCO, describing the same and, if applicable, the steps being taken
with respect thereto:

(i) Termination Events or Unmatured Termination Events. The occurrence of each
Termination Event and each Unmatured Termination Event, by a statement of an
Authorized Officer of IPCO.

 

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(ii) Judgment and Proceedings. (1) The entry of any judgment or decree against
IPCO or any of its Subsidiaries if the aggregate amount of all judgments and
decrees then outstanding against IPCO and its Subsidiaries exceeds $200,000,000
after deducting (a) the amount with respect to which IPCO or any such Subsidiary
is insured and with respect to which the insurer has not denied coverage, and
(b) the amount for which IPCO or any such Subsidiary is otherwise indemnified if
the terms of such indemnification are satisfactory to Buyer (or its assigns),
and (2) the institution of any litigation, arbitration proceeding or
governmental proceeding against IPCO which, individually or in the aggregate,
could reasonably be expected to have a Material Adverse Effect.

(iii) Material Adverse Effect. The occurrence of any event or condition that has
had, or could reasonably be expected to have, a Material Adverse Effect.

(iv) Defaults Under Other Agreements. The occurrence of a default or an event of
default under any other financing arrangement pursuant to which IPCO is a debtor
or an obligor.

(c) Compliance with Laws and Preservation of Existence. IPCO will comply in all
respects with all applicable laws, rules, regulations, orders, writs, judgments,
injunctions, decrees or awards to which it is subject, except where the failure
to so comply could not reasonably be expected to have a Material Adverse Effect.
IPCO will preserve and maintain its corporate existence, rights, franchises and
privileges in the jurisdiction of its organization, and qualify and remain
qualified in good standing as a foreign entity in each jurisdiction where its
business is conducted, except where the failure to so qualify or remain in good
standing could not reasonably be expected to have a Material Adverse Effect.

(d) Audits. IPCO will, from time to time during regular business hours as
requested by Buyer (or its assigns), upon reasonable notice and at the sole cost
of IPCO, permit Buyer (or its assigns) or their respective agents or
representatives, (i) to examine and make copies of and abstracts from all
Records in the possession or under the control of IPCO relating to the
Receivables and the Related Security, including, without limitation, the related
Contracts other than those Contracts that are subject to confidentiality
agreements for which IPCO has been unable, after diligent efforts, to obtain
consent to disclosure, and (ii) to visit the offices and properties of IPCO for
the purpose of examining such materials described in clause (i) above, and to
discuss matters relating to IPCO’s financial condition or the Receivables and
the Related Security or IPCO’s performance under any of the Transaction
Documents or IPCO’s performance under the Contracts and, in each case, with any
of the officers or employees of IPCO having knowledge of such matters (each of
the forgoing examination and visits, a “Review”); provided, however, that, so
long as no Termination Event has occurred and is continuing, (A) IPCO shall only
be responsible for the costs and expenses of one (1) Review in any one calendar
year, and (B) the Buyer (or its assigns) will not request more than two
(2) Reviews in any one calendar year.

 

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(e) Keeping and Marking of Records and Books.

(i) IPCO will maintain and implement administrative and operating procedures
(including, without limitation, an ability to recreate records evidencing
Receivables in the event of the destruction of the originals thereof), and keep
and maintain all documents, books, records and other information reasonably
necessary or advisable for the collection of all Receivables (including, without
limitation, records adequate to permit the immediate identification of each new
Receivable and all Collections of and adjustments to each existing Receivable).
IPCO will give Buyer (or its assigns) notice of any material change in the
administrative and operating procedures referred to in the previous sentence.

(ii) IPCO will (A) on or prior to the date hereof, mark its master data
processing records and other books and records relating to the Receivables with
a legend, acceptable to Buyer (or its assigns), describing Buyer’s ownership
interests in the Receivables and further describing the Loans of the Lenders
under the Credit and Security Agreement and (B) upon the request of Buyer (or
its assigns) following the occurrence and continuation of a Termination Event:
(x) mark each Contract constituting an instrument, chattel paper or a
certificated security (each as defined in the UCC) with a legend describing
Buyer’s ownership interests in the Receivables and further describing the Loans
of the Lenders and (y) deliver to Buyer (or its assigns) all Contracts
(including, without limitation, all multiple originals of any such Contract
constituting an instrument, chattel paper or a certificated security) relating
to the Receivables.

(f) Compliance with Contracts and Credit and Collection Policy. IPCO will timely
and fully (i) perform and comply with all provisions, covenants and other
promises required to be observed by it under the Contracts related to the
Receivables, and (ii) comply in all respects with the Credit and Collection
Policy in regard to each Receivable and the related Contract.

(g) [Intentionally Deleted].

(h) Ownership. IPCO will take all necessary action to establish and maintain,
irrevocably in Buyer, (A) legal and equitable title to the Receivables and the
Collections and (B) all of IPCO’s right, title and interest in the Related
Security associated with the Receivables, in each case, free and clear of any
Adverse Claims other than Adverse Claims in favor of Buyer (and its assigns)
(including, without limitation, the filing of all financing statements or other
similar instruments or documents necessary under the UCC (or any comparable law)
of all appropriate jurisdictions to perfect Buyer’s interest in such
Receivables, Related Security and Collections and such other necessary action to
perfect, protect or more fully evidence the interest of Buyer as Buyer (or its
assigns) may reasonably request).

(i) Lenders’ Reliance. IPCO acknowledges that the Agents and the Lenders are
entering into the transactions contemplated by the Credit and Security Agreement
in reliance upon Buyer’s identity as a legal entity that is separate from IPCO
and any Affiliates thereof. Therefore, from and after the date of execution and
delivery of this Agreement, IPCO will take

 

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all necessary and reasonable steps including, without limitation, all steps that
Buyer or any assignee of Buyer may from time to time reasonably request to
maintain Buyer’s identity as a separate legal entity and to make it manifest to
third parties that Buyer is an entity with assets and liabilities distinct from
those of IPCO and any Affiliates thereof and not just a division of IPCO or any
such Affiliate. Without limiting the generality of the foregoing and in addition
to the other covenants set forth herein, IPCO (i) will not hold itself out to
third parties as liable for the debts of Buyer nor purport to own the
Receivables and other assets acquired by Buyer, (ii) will take all other actions
necessary on its part to ensure that Buyer is at all times in compliance with
the “separateness covenants” (including any applicable grace periods) set forth
in Section 7.1(i) of the Credit and Security Agreement and (iii) will cause all
tax liabilities arising in connection with the transactions contemplated herein
or otherwise to be allocated between IPCO and Buyer on an arm’s-length basis and
in a manner consistent with the procedures set forth in U.S. Treasury
Regulations §§1.1502-33(d) and 1.1552-1.

(j) Collections. IPCO will cause (1) all proceeds from all Lock Boxes to be
directly deposited by a Collection Bank into a Collection Account and (2) each
Lock Box and Collection Account to be subject at all times to a Collection
Account Agreement that is in full force and effect. In the event any payments
relating to Receivables are remitted directly to IPCO or any Affiliate of IPCO,
IPCO will remit (or will cause all such payments to be remitted) directly to a
Collection Bank and deposited into a Collection Account within two (2) Business
Days following receipt thereof and, at all times prior to such remittance, IPCO
will itself hold or, if applicable, will cause such payments to be held in trust
for the exclusive benefit of Buyer and its assigns. IPCO will transfer exclusive
ownership, dominion and control of each Lock Box and Collection Account to Buyer
and, will not grant the right to take dominion and control of any Lock Box or
Collection Account at a future time or upon the occurrence of a future event to
any Person, except to Buyer (or its assigns) as contemplated by this Agreement
and the Credit and Security Agreement.

(k) Taxes. IPCO will file all tax returns and reports required by law to be
filed by it and promptly pay all taxes and governmental charges at any time
owing, except any such taxes which are not yet delinquent or are being
diligently contested in good faith by appropriate proceedings and for which
adequate reserves in accordance with GAAP shall have been set aside on its
books. IPCO will pay when due any taxes payable in connection with the
Receivables, exclusive of taxes on or measured by income or gross receipts of
Buyer and its assigns.

Section 4.2 Negative Covenants of IPCO. Until the date on which this Agreement
terminates in accordance with its terms, IPCO hereby covenants that:

(a) Name Change, Offices and Records. IPCO will not change its (i) state of
organization, (ii) name, (iii) identity or structure (within the meaning of
Article 9 of any applicable enactment of the UCC) or any office where Records
are kept unless it shall have: (i) given Buyer (or its assigns) at least thirty
(30) days’ prior written notice thereof and (ii) delivered to Buyer (or its
assigns) all financing statements, instruments and other documents reasonably
and promptly requested by Buyer (or its assigns) in connection with such change
or relocation.

 

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(b) Change in Payment Instructions to Obligors. IPCO will not add or terminate
any bank as a Collection Bank, or make any change in the instructions to
Obligors regarding payments to be made to any Lock Box or Collection Account,
unless Buyer (or its assigns) shall have received, at least ten (10) days before
the proposed effective date therefor, (i) written notice of such addition,
termination or change and (ii) with respect to the addition of a Collection Bank
or a Collection Account or Lock Box, an executed Collection Account Agreement
with respect to the new Collection Account or Lock Box; provided, however, that
IPCO may make changes in instructions to Obligors without any prior notice
regarding payments if such new instructions require such Obligor to make
payments to another existing Collection Account.

(c) Modifications to Contracts and Credit and Collection Policy. IPCO will not
make any change to the Credit and Collection Policy that could adversely affect
the collectibility of the Receivables or decrease the credit quality of any
newly created Receivables. Except as otherwise permitted in its capacity as
Servicer pursuant to the Credit and Security Agreement, IPCO will not extend,
amend or otherwise modify the terms of any Receivable or any Contract related
thereto other than in accordance with the Credit and Collection Policy.

(d) Sales, Liens. Except as otherwise contemplated by the Transaction Documents,
IPCO will not sell, assign (by operation of law or otherwise) or otherwise
dispose of, or grant any option with respect to, or create or suffer to exist
any Adverse Claim upon (including, without limitation, the filing of any
financing statement) or with respect to, any Receivable, Related Security or
Collections, or upon or with respect to any Contract under which any Receivable
arises, or any Lock Box or Collection Account, or assign any right to receive
income with respect thereto (other than, in each case, the creation of the
interests therein in favor of Buyer provided for herein), and IPCO will defend
the right, title and interest of Buyer in, to and under any of the foregoing
property, against all claims of third parties claiming through or under IPCO.
IPCO shall not create or suffer to exist any mortgage, pledge, security
interest, encumbrance, lien, charge or other similar arrangement on any of its
inventory.

(e) Accounting for Purchase. IPCO will not, and will not permit any Affiliate
to, account for or treat (whether in financial statements or otherwise) the
transactions contemplated hereby in any manner other than the sale of the
Receivables and the Related Security by IPCO to Buyer or in any other respect
account for or treat the transactions contemplated hereby in any manner other
than as a sale of the Receivables and the Related Security by IPCO to Buyer
except to the extent that such transactions are not recognized on account of
consolidated financial reporting in accordance with generally accepted
accounting principles.

ARTICLE V

TERMINATION EVENTS

Section 5.1 Termination Events. The occurrence of any one or more of the
following events shall constitute a Termination Event:

(a) IPCO shall fail (i) to make any payment or deposit (A) of principal when
required to be made by it hereunder or (B) any other obligation or amount not
covered by clause (A) when required hereunder and such failure shall continue
for three (3) consecutive Business Days, or (ii) to perform or observe any term,
covenant or agreement contained in Section 4.1(a)(i), (ii), (iii), (iv), (v) or
(vii)(B), Section 4.1(f)(i), or Section 4.1(j) and such failure shall continue
for thirty (30) consecutive days, or (iii) to perform or observe any term,
covenant or agreement hereunder (other than as referred to in clause (i) or
(ii) of this paragraph (a)) or any other Transaction Document to which it is a
party and such failure shall continue for ten (10) consecutive Business Days.

 

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(b) Any representation, warranty, certification or statement made by IPCO in
this Agreement, any other Transaction Document or in any other document
delivered pursuant hereto or thereto shall prove to have been incorrect in any
material respect when made or deemed made; provided that the materiality
threshold in the preceding clause shall not be applicable with respect to any
representation or warranty which itself contains a materiality threshold.

(c) Failure of IPCO to pay any Indebtedness when due in excess of $200,000,000
(“Material Indebtedness”); or the default by IPCO in the performance of any
term, provision or condition contained in any agreement under which any Material
Indebtedness was created or is governed, the effect of which is to cause such
Indebtedness to become due prior to its stated maturity; or any Material
Indebtedness of IPCO shall be declared to be due and payable or required to be
prepaid (other than by a regularly scheduled payment) prior to the date of
maturity thereof.

(d) An Event of Bankruptcy shall occur with respect to IPCO or any Subsidiary of
IPCO which meets the definition of “Material Subsidiary” defined in the Credit
and Security Agreement.

(e) A Change of Control shall occur.

(f) One or more final judgments for the payment of money in an amount in excess
of $200,000,000, individually or in the aggregate, shall be entered against IPCO
on claims not covered by insurance or as to which the insurance carrier has
denied its responsibility, and such judgment shall continue unsatisfied and in
effect for thirty (30) consecutive days without a stay of execution.

(g) An Amortization Event specified in Section 9.1(p) of the Credit and Security
Agreement shall have occurred.

Section 5.2 Remedies. Upon the occurrence and during the continuation of a
Termination Event, Buyer may take any of the following actions: (i) declare the
Termination Date to have occurred, whereupon the Termination Date shall
forthwith occur, without demand, protest or further notice of any kind, all of
which are hereby expressly waived by IPCO; provided, however, that upon the
occurrence of a Termination Event described in Section 5.1(d), the Termination
Date shall automatically occur, without demand, protest or any notice of any
kind, all of which are hereby expressly waived by IPCO and (ii) to the fullest
extent permitted by

 

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applicable law, declare that the Default Fee shall accrue with respect to any
amounts then due and owing by IPCO to Buyer. The aforementioned rights and
remedies shall be without limitation and shall be in addition to all other
rights and remedies of Buyer and its assigns otherwise available under any other
provision of this Agreement, by operation of law, at equity or otherwise, all of
which are hereby expressly preserved, including, without limitation, all rights
and remedies provided under the UCC, all of which rights shall be cumulative.

ARTICLE VI

INDEMNIFICATION

Section 6.1 Indemnities by IPCO. Without limiting any other rights that Buyer
may have hereunder or under applicable law and subject to the last sentence of
this Section 6.1, IPCO hereby agrees to indemnify (and pay upon demand to) Buyer
and its assigns, officers, directors, agents and employees (each an “Indemnified
Party”) from and against any and all damages, losses, claims, taxes,
liabilities, penalties, costs, expenses and for all other amounts payable,
including reasonable attorneys’ fees (which attorneys may be employees of Buyer
or any such assign) and disbursements (all of the foregoing being collectively
referred to as “Indemnified Amounts”) awarded against or incurred by any of
them, directly or indirectly, arising out of or as a result of the execution,
delivery, performance, non-performance, enforcement, non-enforcement of, or
other condition or circumstance whatsoever with respect to, this Agreement or
any of the Transaction Documents (including without limitation (i) any fees and
expenses of attorneys and other advisers and (ii) any Taxes (other than Excluded
Taxes): (I) which may be asserted or imposed in respect of the Receivables or
the receipt of Collections or other proceeds with respect to the Receivables or
any Related Security, (II) which may arise by reason of the Receivables or
ownership or the sale or other disposition thereof, or any other interest in the
Receivables or in any Related Security or (III) which may arise otherwise by
reason of the execution, delivery, performance, non-performance, enforcement or
non-enforcement of, or other condition or circumstance whatsoever with respect
to the Receivables, the Related Security, this Agreement or any Transaction
Document; except that, notwithstanding the foregoing parenthetical exclusion
relating to Excluded Taxes, in the event that the Obligations of IPCO hereunder
are for any reason determined not to be treated as indebtedness of IPCO for
income or franchise tax purposes, IPCO shall indemnify each Indemnified Party in
respect of such additional amounts in respect of such Taxes as may be described
in clauses (I), (II) or (III), with such amounts being calculated on an
after-tax basis, as are imposed on or incurred by an Indemnified Party to the
extent that such Taxes would not have been imposed or incurred (or would not
have been imposed or incurred at the same time) had the obligations of IPCO
hereunder or the acquisition, either directly or indirectly, by Buyer of an
interest in the Receivables, been treated as indebtedness for such income or
franchise tax purposes, as applicable, excluding, however: Indemnified Amounts
to the extent such Indemnified Amounts resulted from gross negligence or willful
misconduct on the part of the Indemnified Party seeking indemnification

Without limiting the generality of the foregoing indemnification, but subject in
each case to clauses (a), (b) and (c) above, IPCO shall indemnify Buyer for
Indemnified Amounts relating to or resulting from:

(i) any representation or warranty made by IPCO (or any officers of IPCO) under
or in connection with any Purchase Report, this Agreement, any other Transaction
Document or any other information or report delivered by IPCO pursuant hereto or
thereto for which Buyer has not received a Purchase Price Credit that shall have
been false or incorrect when made or deemed made;

 

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(ii) the failure by IPCO, to comply with any applicable law, rule or regulation
with respect to any Receivable or Contract related thereto, or the nonconformity
of any Receivable or Contract included therein with any such applicable law,
rule or regulation or any failure of any Transferor to keep or perform any of
its obligations, express or implied, with respect to any Contract;

(iii) any failure of IPCO to perform its duties, covenants or other obligations
in accordance with the provisions of this Agreement or any other Transaction
Document;

(iv) any products liability, personal injury or damage, suit or other similar
claim arising out of or in connection with merchandise, insurance or services
that are the subject of any Contract or any Receivable;

(v) any dispute, claim, offset or defense (other than discharge in bankruptcy of
the Obligor) of the Obligor to the payment of any Receivable (including, without
limitation, a defense based on such Receivable or the related Contract not being
a legal, valid and binding obligation of such Obligor enforceable against it in
accordance with its terms), or any other claim resulting from the sale of the
merchandise or service related to such Receivable or the furnishing or failure
to furnish such merchandise or services;

(vi) the commingling of Collections of Receivables at any time with other funds;

(vii) any investigation, litigation or proceeding related to or arising from
this Agreement or any other Transaction Document, the transactions contemplated
hereby, the use of the proceeds of the Purchase hereunder, the ownership of the
Receivables or any other investigation, litigation or proceeding relating to
IPCO in which any Indemnified Party becomes involved as a result of any of the
transactions contemplated hereby;

(viii) any inability to litigate any claim against any Obligor in respect of any
Receivable as a result of such Obligor being immune from civil and commercial
law and suit on the grounds of sovereignty or otherwise from any legal action,
suit or proceeding;

(ix) any Termination Event described in Section 5.1(d);

(x) [intentionally deleted];

 

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(xi) any failure to vest and maintain vested in Buyer, or to transfer to Buyer,
legal and equitable title to, and ownership of, the Receivables and the
Collections, and all of IPCO’s right, title and interest in the Related Security
associated with the Receivables, in each case, free and clear of any Adverse
Claim (other than as created hereunder);

(xii) the failure to have filed, or any delay in filing, financing statements or
other similar instruments or documents under the UCC of any applicable
jurisdiction or other applicable laws with respect to any Receivable, the
Related Security and Collections with respect thereto, and the proceeds of any
thereof, whether at the time of the Purchase or at any subsequent time;

(xiii) any action or omission by IPCO which reduces or impairs the rights of
Buyer with respect to any Receivable or the value of any such Receivable;

(xiv) any attempt by any Person to void the Purchase hereunder under statutory
provisions or common law or equitable action; and

(xv) the failure of any Receivable reflected as an Eligible Receivable on any
Purchase Report to be an Eligible Receivable at the time acquired by Buyer.

Notwithstanding the foregoing, (1) the foregoing indemnification is not intended
to, and shall not, constitute a guarantee of the collectibility or payment of
the Receivables conveyed hereunder; and (2) nothing in this Section 6.1 shall
require IPCO to indemnify any Indemnified Party for Receivables which are not
collected, not paid or otherwise uncollectible on account of the insolvency,
bankruptcy, creditworthiness or financial inability to pay of the applicable
Obligor. The agreements in this subsection shall survive the collection of all
Receivables, the termination of this Agreement and the payment of all amounts
payable hereunder.

If any Indemnified Party shall have notice of any attempt to impose or collect
any tax or governmental fee or charge for which indemnification will be sought
from IPCO under Section 6.1(iv), such Indemnified Party shall give prompt and
timely notice of such attempt to IPCO, and IPCO shall have the right, at its
expense, to participate in any proceedings resisting or objecting to the
imposition or collection of any such tax, governmental fee or charge.
Indemnification hereunder shall be in an amount necessary to make each
Indemnified Party whole after taking into account any tax consequences to the
Indemnified Party of the payment of any of the aforesaid taxes (including any
deduction) and the receipt of the indemnity provided hereunder or of any refund
of any such tax previously indemnified hereunder, including the effect of such
tax, deduction or refund on the amount of tax measured by net income or profits
which is or was payable by the Indemnified Party. If for any reason the
indemnification provided above in this Section 6.1 is unavailable to an
Indemnified Party or is insufficient to hold such Indemnified Party harmless,
then IPCO shall contribute to the amount paid or payable by such Indemnified
Party to the maximum extent permitted under applicable law.

Section 6.2 Other Costs and Expenses. IPCO shall pay to Buyer on demand all
reasonable costs and out-of-pocket expenses actually incurred in connection with
the preparation,

 

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execution, delivery and administration of this Agreement, the transactions
contemplated hereby and the other documents to be delivered hereunder. IPCO
shall pay to Buyer on demand any and all costs and expenses of Buyer, if any,
including reasonable counsel fees and expenses in connection with the
enforcement of this Agreement and the other documents delivered hereunder and in
connection with any restructuring or workout of this Agreement or such
documents, or the administration of this Agreement following a Termination
Event.

ARTICLE VII

MISCELLANEOUS

Section 7.1 Waivers and Amendments.

(a) No failure or delay on the part of Buyer (or its assigns) in exercising any
power, right or remedy under this Agreement shall operate as a waiver thereof,
nor shall any single or partial exercise of any such power, right or remedy
preclude any other further exercise thereof or the exercise of any other power,
right or remedy. The rights and remedies herein provided shall be cumulative and
nonexclusive of any rights or remedies provided by law. Any waiver of this
Agreement shall be effective only in the specific instance and for the specific
purpose for which given.

(b) No provision of this Agreement may be amended, supplemented, modified or
waived except in writing signed by IPCO and Buyer and, to the extent required
under the Credit and Security Agreement, the Agents and the Lenders. Any
material amendment, supplement, modification of waiver will require satisfaction
of the Rating Agency Condition to the extent applicable to any Lender.

Section 7.2 Notices. All communications and notices provided for hereunder shall
be in writing (including bank wire, telecopy or electronic facsimile
transmission or similar writing) and shall be given to the other parties hereto
at their respective addresses or telecopy numbers set forth on the signature
pages hereof or at such other address or telecopy number as such Person may
hereafter specify for the purpose of notice to each of the other parties hereto.
Each such notice or other communication shall be effective (a) if given by
telecopy, upon the receipt thereof, (b) if given by mail, three (3) Business
Days after the time such communication is deposited in the mail with first class
postage prepaid or (c) if given by any other means, when received at the address
specified in this Section 7.2.

Section 7.3 Protection of Ownership Interests of Buyer.

(a) IPCO agrees that from time to time, at its expense, it will promptly execute
and deliver all instruments and documents, and take all actions, that may be
necessary or desirable, or that Buyer (or its assigns) may request, to perfect,
protect or more fully evidence the interest of Buyer hereunder and the
Receivable Interests, or to enable Buyer (or its assigns) to exercise and
enforce their rights and remedies hereunder. At any time, Buyer (or its assigns)
may, at IPCO’s sole cost and expense, direct IPCO to notify the Obligors of
Receivables of the

 

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ownership interests of Buyer under this Agreement and may also direct that
payments of all amounts due or that become due under any or all Receivables be
made directly to Buyer or its designee.

(b) If IPCO fails to perform any of its obligations hereunder, Buyer (or its
assigns) may (but shall not be required to) perform, or cause performance of,
such obligations, and Buyer’s (or such assigns’) costs and expenses incurred in
connection therewith shall be payable by IPCO as provided in Section 6.2. IPCO
irrevocably authorizes Buyer (and its assigns) at any time and from time to time
in the sole discretion of Buyer (or its assigns), and appoints Buyer (and its
assigns) as its attorney(ies)-in-fact, to act on behalf of IPCO (i) to execute
on behalf of IPCO as debtor and to file financing statements necessary or
desirable in Buyer’s (or its assigns’) sole discretion to perfect and to
maintain the perfection and priority of the interest of Buyer in the Receivables
and associated Related Security and Collections and (ii) to file a carbon,
photographic or other reproduction of this Agreement or any financing statement
with respect to the Receivables as a financing statement in such offices as
Buyer (or its assigns) in their sole discretion deem necessary or desirable to
perfect and to maintain the perfection and priority of Buyer’s interests in the
Receivables. This appointment is coupled with an interest and is irrevocable.
IPCO hereby authorizes Buyer (or its assigns) to file financing statements and
other filing or recording documents with respect to the Receivables and Related
Security (including any amendments thereto, or continuation or termination
statements thereof), without the signature or other authorization of IPCO, in
such form and in such offices as Buyer (or any of its assigns) reasonably
determines appropriate to perfect or maintain the perfection of the ownership or
security interests of Buyer (or its assigns) hereunder. IPCO acknowledges and
agrees that it is not authorized to, and will not, file financing statements or
other filing or recording documents with respect to the Receivables or Related
Security (including any amendments thereto, or continuation or termination
statements thereof), without the express prior written approval by the Agent (as
Buyer’s assignee), consenting to the form and substance of such filing or
recording document. IPCO approves, authorizes and ratifies any filings or
recordings made by or on behalf of the Administrative Agent (as Buyer’s ultimate
assign) in connection with the perfection of the ownership or security interests
in favor of Buyer or the Administrative Agent (as Buyer’s ultimate assign).

Section 7.4 Confidentiality.

(a) IPCO shall maintain and shall cause each of its employees and officers to
maintain the confidentiality of this Agreement and the other confidential or
proprietary information that is clearly marked as being confidential and/or
proprietary with respect to the Agents, the Conduits and their respective
businesses obtained by it or them in connection with the structuring,
negotiating and execution of the transactions contemplated herein, except that
IPCO and its officers and employees may disclose such information to IPCO’s
external accountants and attorneys and as required by any applicable law or
order of any judicial or administrative proceeding.

(b) Anything herein to the contrary notwithstanding, IPCO hereby consents to the
disclosure of any nonpublic information with respect to it (i) to Buyer, the
Agents and the Lenders by each other, (ii) by Buyer, the Agents or the Lenders
to any prospective or

 

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actual assignee or participant of any of them and (iii) by the Co-Agents to any
rating agency, Promissory Note dealer or provider of a surety, guaranty or
credit or liquidity enhancement to any Conduit or any entity organized for the
purpose of purchasing, or making loans secured by, financial assets for which
any Co-Agent or one of its affiliates acts as the administrative agent or
administrator and to any officers, directors, employees, outside accountants and
attorneys of any of the foregoing, provided each such Person is informed of the
confidential nature of such information. In addition, the Lenders and the Agents
may disclose any such nonpublic information pursuant to any law, rule,
regulation, direction, request or order of any judicial, administrative or
regulatory authority or proceedings (whether or not having the force or effect
of law).

(c) Buyer shall maintain and shall cause each of its employees and officers to
maintain the confidentiality of this Agreement and the other confidential or
proprietary information with respect to IPCO, the Obligors and their respective
businesses obtained by it in connection with the due diligence evaluations,
structuring, negotiating and execution of the Transaction Documents, and the
consummation of the transactions contemplated herein and any other activities of
Buyer arising from or related to the transactions contemplated herein provided,
however, that each of Buyer and its employees and officers shall be permitted to
disclose such confidential or proprietary information: (i) to the Agents and the
Lenders, (ii) to any prospective or actual assignee or participant of the Agents
or the Lenders who executes a confidentiality agreement for the benefit of IPCO
and Buyer on terms comparable to those required of Buyer hereunder with respect
to such disclosed information, (iii) to any rating agency, provider of a surety,
guaranty or credit or liquidity enhancement to any Conduit, (iv) to any
officers, directors, employees, outside accountants and attorneys of any of the
foregoing, and (v) to the extent required pursuant to any applicable law, rule,
regulation, direction, request or order of any judicial, administrative or
regulatory authority or proceedings with competent jurisdiction (whether or not
having the force or effect of law) so long as such required disclosure is made
under seal to the extent permitted by applicable law or by rule of court or
other applicable body.

(d) Notwithstanding any other provision in this Agreement, Buyer does not object
to IPCO and its representatives from disclosing the U.S. tax treatment or U.S.
tax structure of the transactions evidenced hereby.

Section 7.5 Bankruptcy Petition.

(a) To the fullest extent permitted by law, IPCO and Buyer each hereby covenants
and agrees that, prior to the date that is one year and one day after the
payment in full of all outstanding senior indebtedness of any Conduit, it will
not institute against, or join any other Person in instituting against, any
Conduit any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings or other similar proceeding under the laws of the United States or
any state of the United States.

(b) To the fullest extent permitted by law, IPCO each hereby covenants and
agrees that, prior to the date that is one year and one day after the payment in
full of all

 

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outstanding obligations of the Buyer under the Credit and Security Agreement, it
will not institute against, or join any other Person in instituting against,
Buyer any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings or other similar proceeding under the laws of the United States or
any state of the United States.

Section 7.6 Limitation of Liability. Except with respect to any claim arising
out of the willful misconduct or gross negligence of any Lender or any Agent, no
claim may be made by IPCO or any other Person against any Lender or any Agent or
their respective Affiliates, directors, officers, employees, attorneys or agents
for any special, indirect, consequential or punitive damages in respect of any
claim for breach of contract or any other theory of liability arising out of or
related to the transactions contemplated by this Agreement, or any act, omission
or event occurring in connection therewith; and IPCO hereby waives, releases,
and agrees not to sue upon any claim for any such damages, whether or not
accrued and whether or not known or suspected to exist in its favor.

Section 7.7 CHOICE OF LAW. THIS AGREEMENT SHALL BE GOVERNED AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE
PRINCIPLES OF CONFLICTS OF LAWS THEREOF OTHER THAN SECTION 5-1401 OF THE GENERAL
OBLIGATIONS LAW (EXCEPT IN THE CASE OF THE OTHER TRANSACTION DOCUMENTS, TO THE
EXTENT OTHERWISE EXPRESSLY STATED THEREIN) AND EXCEPT TO THE EXTENT THAT THE
PERFECTION OF THE OWNERSHIP INTEREST OR THE SECURITY INTEREST OF THE BUYER OR
ANY OF ITS ASSIGNS IS GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE
STATE OF NEW YORK.

Section 7.8 CONSENT TO JURISDICTION. EACH PARTY HERETO HEREBY IRREVOCABLY
SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR NEW
YORK STATE COURT SITTING IN NEW YORK, NEW YORK IN ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY DOCUMENT EXECUTED BY IPCO
PURSUANT TO THIS AGREEMENT AND IPCO HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN
RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH
COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO
THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A COURT OR THAT
SUCH COURT IS AN INCONVENIENT FORUM. NOTHING HEREIN SHALL LIMIT THE RIGHT OF
BUYER (OR ITS ASSIGNS) TO BRING PROCEEDINGS AGAINST IPCO IN THE COURTS OF ANY
OTHER JURISDICTION. ANY JUDICIAL PROCEEDING BY IPCO AGAINST BUYER (OR ITS
ASSIGNS) OR ANY AFFILIATE THEREOF INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER
IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH THIS AGREEMENT OR ANY
DOCUMENT EXECUTED BY IPCO PURSUANT TO THIS AGREEMENT SHALL BE BROUGHT ONLY IN A
COURT IN NEW YORK, NEW YORK.

Section 7.9 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES TRIAL BY JURY
IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY

 

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OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN
ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH THIS AGREEMENT, ANY
DOCUMENT EXECUTED BY IPCO PURSUANT TO THIS AGREEMENT OR THE RELATIONSHIP
ESTABLISHED HEREUNDER OR THEREUNDER.

Section 7.10 Integration; Binding Effect; Survival of Terms.

(a) This Agreement and each other Transaction Document contain the final and
complete integration of all prior expressions by the parties hereto with respect
to the subject matter hereof and shall constitute the entire agreement among the
parties hereto with respect to the subject matter hereof superseding all prior
oral or written understandings.

(b) This Agreement shall be binding upon and inure to the benefit of IPCO, Buyer
and their respective successors and permitted assigns (including any trustee in
bankruptcy). IPCO may not assign any of its rights and obligations hereunder or
any interest herein without the prior written consent of Buyer. Buyer may assign
at any time its rights and obligations hereunder and interests herein to any
other Person without the consent of IPCO. Without limiting the foregoing, IPCO
acknowledges that Buyer, pursuant to one Credit and Security Agreement, may
assign to the Administrative Agent, for the benefit of the Lenders, its rights,
remedies, powers and privileges hereunder and that the Administrative Agent may
further assign such rights, remedies, powers and privileges to the extent
permitted in the Credit and Security Agreement. IPCO agrees that the
Administrative Agent, as the ultimate assignee hereof, shall, subject to the
terms of the Credit and Security Agreement, have the right to enforce this
Agreement and to exercise directly all of Buyer’s rights and remedies under this
Agreement (including, without limitation, the right to give or withhold any
consents or approvals of Buyer to be given or withheld hereunder) and IPCO
agrees to cooperate fully with the Administrative Agent in the exercise of such
rights and remedies. This Agreement shall create and constitute the continuing
obligations of the parties hereto in accordance with its terms and shall remain
in full force and effect until terminated in accordance with its terms;
provided, however, that the rights and remedies with respect to (i) any breach
of any representation and warranty made by IPCO pursuant to Article II; (ii) the
indemnification and payment provisions of Article VI; and (iii) Section 7.5
shall be continuing and shall survive any termination of this Agreement.

Section 7.11 Counterparts; Severability; Section References. This Agreement may
be executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which when taken together shall constitute one and the same
Agreement. Delivery of an executed counterpart of a signature page to this
Agreement by telecopier shall be as effective as delivery of a manually executed
counterpart of a signature page to this Agreement. Any provisions of this
Agreement which are prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction. Unless otherwise
expressly indicated, all references herein to “Article,” “Section,” “Schedule”
or “Exhibit” shall mean articles and sections of, and schedules and exhibits to,
this Agreement.

 

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Section 7.12 Payment Rescission. No payment of any amount hereunder shall be
considered paid or applied to the extent that, at any time, all or any portion
of such payment or application is rescinded by application of law or judicial
authority, or must otherwise be returned or refunded for any reason. The payor
shall remain obligated for the amount of any payment or application so
rescinded, returned or refunded, and shall promptly pay to the payee who
suffered such rescission, return or refund the full amount thereof, plus the
Default Fee from the date of any such rescission, return or refunding.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
and delivered by their duly authorized officers as of the date hereof.

 

INTERNATIONAL PAPER COMPANY

By:

 

/s/ Errol A. Harris

Name:

  Errol A. Harris

Title:

  Vice President & Treasurer   Address:   6400 Poplar Avenue     Memphis,
Tennessee 38197    

Attn:

 

Errol A. Harris

V.P. & Treasurer

   

Phone:

  901/419-4740    

Fax:

  901/419-4539 RED BIRD RECEIVABLES, LLC

By:

 

/s/ David E. Arick

Name:

  David E. Arick

Title:

  President   Address:   6400 Poplar Avenue     Memphis, Tennessee 38197    

Attn:

 

David E. Arick

President

   

Phone:

  901/419-3977    

Fax:

  901/419-4539

 

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Exhibit I

Definitions

This is Exhibit I to the Agreement (as hereinafter defined). As used in the
Agreement and the Exhibits and Schedules thereto, capitalized terms have the
meanings set forth in this Exhibit I (such meanings to be equally applicable to
the singular and plural forms thereof). If a capitalized term is used in the
Agreement, or any Exhibit or Schedule thereto, and is not otherwise defined
therein or in this Exhibit I, such term shall have the meaning assigned thereto
in Exhibit I to the Credit and Security Agreement (hereinafter defined).

“Administrative Agent” has the meaning set forth in the Preliminary Statements
to the Agreement.

“Agreement” means the Receivables Sale and Contributing Agreement, dated as of
March 13, 2008, between IPCO and Buyer, as the same may be amended, restated or
otherwise modified.

“Buyer” has the meaning set forth in the preamble to the Agreement.

“Calculation Period” means each calendar month or portion thereof which elapses
during the term of the Agreement. The first Calculation Period shall commence on
the date of the Purchases hereunder and the final Calculation Period shall
terminate on the Termination Date.

“Change of Control” means the acquisition by any Person, or two or more Persons
acting in concert, of beneficial ownership (within the meaning of Rule 13d-3 of
the Securities and Exchange Commission under the Securities Exchange Act of
1934) of 20% or more of the outstanding shares of voting stock of IPCO.

“Credit and Collection Policy” means IPCO’s credit and collection policies and
practices relating to Contracts and Receivables existing on the date hereof and
summarized in Exhibit V, as modified from time to time in accordance with the
Agreement.

“Credit and Security Agreement” has the meaning set forth in the Preliminary
Statements to the Agreement.

“Default Fee” means a per annum rate of interest equal to the sum of (i) the
Prime Rate, plus (ii) 2% per annum.

“Discount Factor” means a percentage calculated to provide Buyer with a
reasonable return on its investment in the Receivables after taking account of
(i) the time value of money based upon the anticipated dates of collection of
the Receivables and the cost to Buyer of financing its investment in the
Receivables during such period and (ii) the risk of nonpayment by the Obligors.
IPCO and Buyer may agree from time to time to change the Discount Factor based
on changes in one or more of the items affecting the calculation thereof,
provided that any change to the Discount Factor shall take effect as of the
commencement of a Calculation Period,

 

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shall apply only prospectively and shall not affect the Purchase Price payment
made prior to the Calculation Period during which IPCO and Buyer agree to make
such change. As of the date hereof, the Discount Factor is as follows: 1.45% for
Receivables arising from sales or services by Originator’s U.S. printing papers
and U.S. pulp divisions, 1.49% for Receivables arising from sales or services by
Originator’s consumer packaging and industrial packaging divisions, and 1.44%
for Receivables arising from sales or services by Originator’s xpedx division.

“Excluded Taxes” means, with respect to a Indemnified Party, Taxes which are
(a) both (i) imposed by the jurisdiction in which such Indemnified Party is
organized or by any other taxing authority of a United States jurisdiction as a
result of such Indemnified Party doing business or maintaining an office in such
jurisdiction (other than any such taxes that the Indemnified Party establishes
would not have been imposed but for (A) such Indemnified Party having executed,
or enforced, a Transaction Document or (B) any of the transactions contemplated
herein or in the other Transaction Documents) and also (ii) imposed on, based on
or measured by net pre-tax income, capital or net worth of such Indemnified
Party (other than Taxes that are, or are in the nature of, sales, use, rental,
property or value added or similar taxes) or (b) any Tax, assignment or other
governmental charge attributable to and which would not have been imposed but
for the failure of a Indemnified Party to deliver to IPCO the Prescribed Forms
properly completed and duly executed by such Indemnified Party establishing such
party’s exemption from, or eligibility for, a reduced rate of any such tax or
assessment.

“IPCO” has the meaning set forth in the preamble to the Agreement.

“Material Adverse Effect” means a material adverse effect on (i) the financial
condition or operations of IPCO and its Material Subsidiaries, taken as a whole,
(ii) the ability of IPCO to perform its obligations under the Agreement or any
other Transaction Document, (iii) the legality, validity or enforceability of
the Agreement or any other Transaction Document, (iv) IPCO’s, Buyer’s, the
Administrative Agent’s or any Lender’s interest in the Receivables generally or
in any significant portion of the Receivables, the Related Security or
Collections with respect thereto, or (v) the collectibility of the Receivables
generally or of any material portion of the Receivables.

“Moody’s” means Moody’s Investors Service, Inc.

“Net Worth” means as of the last Business Day of each Calculation Period
preceding any date of determination, the excess, if any, of (a) the aggregate
Outstanding Balance of the Receivables at such time, over (b) the sum of (i) the
Aggregate Principal outstanding at such time, plus (ii) the aggregate
outstanding principal balance of the Subordinated Loans (including any
Subordinated Loan proposed to be made on the date of determination).

“Organizational Documents” means, for any Person, the documents for its
formation and organization, which, for example, (a) for a corporation are its
corporate charter and bylaws, (b) for a partnership are its certificate of
partnership (if applicable) and partnership agreement, (c) for a limited
liability company are its certificate of formation or organization and its
operating agreement, regulations or the like and (d) for a trust is the trust
agreement, declaration of trust, indenture or bylaws under which it is created.

 

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“Original Balance” means, with respect to any Receivable coming into existence
after the date of this Agreement, the invoice amount of such Receivable on the
date it was created.

“PBGC” means the Pension Benefit Guaranty Corporation, or any successor thereto.

“Pension Plan” means a pension plan (as defined in Section 3(2) of ERISA)
subject to Title IV of ERISA which IPCO sponsors or maintains, or to which it
makes, is making, or is obligated to make contributions, or in the case of a
multiple employer plan (as described in Section 4064(a) of ERISA) has made
contributions at any time during the immediately preceding five plan years.

“Plan” means an employee benefit plan (as defined in Section 3(3) of ERISA)
which IPCO or any of its ERISA Affiliates sponsors or maintains or to which IPCO
or any of its ERISA Affiliates makes, is making, or is obligated to make
contributions and includes any Pension Plan, other than a Plan maintained
outside the United States primarily for the benefit of Persons who are not U.S.
residents.

“Purchase” means the purchase pursuant to Section 1.2(a) of the Agreement by
Buyer from IPCO of the Receivables and the Related Security and Collections
related thereto, together with all related rights in connection therewith.

“Purchase Price” means, with respect to the Purchase, the aggregate price to be
paid by Buyer to IPCO for such Purchase in accordance with Section 1.3 of the
Agreement for the Receivables, Collections and Related Security being sold to
Buyer, which price shall equal on any date (i) the product of (x) the
Outstanding Balance of such Receivables on such date, multiplied by (y) one
minus the Discount Factor in effect on such date, minus (ii) any Purchase Price
Credits to be credited against the Purchase Price otherwise payable in
accordance with Section 1.4 of the Agreement.

“Purchase Price Credit” has the meaning set forth in Section 1.4 of the
Agreement.

“Purchase Report” has the meaning set forth in Section 1.2(b) of the Agreement.

“Receivable” means all indebtedness and other obligations owed to IPCO (at the
times it arises, and before giving effect to any transfer or conveyance under
this Agreement) or Buyer (after giving effect to the transfers under this
Agreement) or in which IPCO or Buyer has a security interest or other interest,
including, without limitation, any indebtedness, obligation or interest
constituting an account, chattel paper, instrument or general intangible, to the
extent arising in connection with the domestic sale of goods or the rendering of
services by one of IPCO’s businesses listed on Schedule B attached hereto (which
Schedule B may be amended, modified or supplemented from time to time) and
further includes, without limitation, the obligation to pay any Finance Charges
with respect thereto. Indebtedness and other rights and obligations arising from
any one transaction, including, without limitation, indebtedness and

 

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other rights and obligations represented by an individual invoice, shall
constitute a Receivable separate from a Receivable consisting of the
indebtedness and other rights and obligations arising from any other
transaction; provided, further, that any indebtedness, rights or obligations
referred to in the immediately preceding sentence shall be a Receivable
regardless or whether the account debtor or IPCO treats such indebtedness,
rights or obligations as a separate payment obligation.

“Related Security” means, with respect to any Receivable:

(i) all of IPCO’s right, title and interest in the inventory and goods
(including returned or repossessed inventory or goods), if any, the sale of
which by any business of IPCO identified by location on Schedule B attached
hereto as such Schedule may be amended, modified or supplemented from time to
time gave rise to such Receivable, and all insurance contracts with respect
thereto,

(ii) all other security interests or liens and property subject thereto from
time to time, if any, purporting to secure payment of such Receivable, whether
pursuant to the Contract related to such Receivable or otherwise, together with
all financing statements and security agreements describing any collateral
securing such Receivable,

(iii) all guaranties, letters of credit, insurance and other agreements or
arrangements of whatever character from time to time supporting or securing
payment of such Receivable whether pursuant to the Contract related to such
Receivable or otherwise,

(iv) all service contracts and other contracts and agreements associated with
such Receivable,

(v) all Records related to such Receivable,

(vi) all of IPCO’s right, title and interest in each Lock Box and each
Collection Account, and

(vii) all proceeds of any of the foregoing.

“Required Capital Amount” means, as of any date of determination, an amount
equal to the greater of (a) 3% of the Aggregate Commitment under the Credit and
Security Agreement, and (b) the product of (i) 1.5 times the product of the
Default Ratio times the Default Horizon Ratio, each as determined from the most
recent Monthly Report received from the Servicer under the Credit and Security
Agreement, and (ii) the Outstanding Balance of all Receivables as of such date,
as determined from the most recent Monthly Report received from the Servicer
under the Credit and Security Agreement.

“S&P” means Standard and Poor’s Ratings Services, a division of The McGraw Hill
Companies, Inc.

 

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“Settlement Date” means, with respect to each Calculation Period, the date that
is the 14th calendar day of the month following such Calculation Period.

“Subordinated Loan” has the meaning set forth in Section 1.3(a) of the
Agreement.

“Subordinated Note” means a promissory note in substantially the form of Exhibit
VI hereto as more fully described in Section 1.3 of the Agreement, as the same
may be amended, restated, supplemented or otherwise modified from time to time.

“Tax Code” means the Internal Revenue Code of 1986, as the same may be amended
from time to time.

“Tax or Taxes” means all license and registration fees and all income, gross
receipts, rental, franchise, excise, occupational, capital, value added, sales,
use, ad valorem (real and personal), property (real and personal) and excise
taxes, fees, levies, imposts, charges or withholdings of any nature whatsoever,
together with any assessments, penalties, fines, additions to tax and interest
thereon, by and federal, state or local government or taxing authority in the
United States or by any foreign government, foreign governmental subdivision or
other foreign or international taxing authority.

“Termination Date” means the earliest to occur of (i) the Facility Termination
Date (as defined in the Credit and Security Agreement), (ii) the Business Day
immediately prior to the occurrence of a Termination Event set forth in
Section 5.1(d), (iii) the Business Day specified in a written notice from Buyer
to IPCO following the occurrence of any other Termination Event, and (iv) the
date which is 10 Business Days after Buyer’s receipt of written notice from IPCO
that it wishes to terminate the facility evidenced by this Agreement.

“Termination Event” has the meaning set forth in Section 5.1 of the Agreement.

“Transaction Documents” means, collectively, this Agreement, each Collection
Account Agreement, the Subordinated Note, and all other instruments, documents
and agreements executed and delivered in connection herewith.

“Unmatured Termination Event” means an event which, with the passage of time or
the giving of notice, or both, would constitute a Termination Event.

All accounting terms not specifically defined herein shall be construed in
accordance with GAAP. All terms used in Article 9 of the UCC in the State of New
York, and not specifically defined herein, are used herein as defined in such
Article 9.

 

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Exhibit II

Places of Business; Locations of Records;

Federal Employer Identification Number(s); Other Names

 

Places of Business:    6400 Poplar Avenue, Memphis, TN 38197 Locations of
Records:    6400 Poplar Avenue, Memphis, TN 38197 Federal Employer
Identification Number: 13-0872805

Legal, Trade and Assumed Names in the Past Five Years: International Paper;
Hammermill Papers; xpedx; Evergreen Packaging Equipment; Strathmore Paper
Company (a/n); The Beckett Paper Company; AKROSIL CORPORATION; Thilmany Pulp &
Paper Company; Transo Envelope Company; Palmer Paper Company (assumed name);
Dillard Paper Company; WAYNE PAPER COMPANY; Hammermill Papers-Kentucky; HPC
Redistribution; Bulkley Dunton Publishing Group; International Blending; Beacon
Paper Company; BEACON PACKAGING; WAYNE – PAPER SUPPLY; Carter Rice; Slaughter
Industries; Carpenter’s Corner; McKinney Coated Products; American Supply
Company; Crown Supply, Inc.; Lee Markey Equipment; THILMANY PULP & PAPER
COMPANY; Resourcenet International; PAPERLAND; HAMMERMILL PAPERS; RESOURCENET
INTERNATIONAL; Seaman-Patrick Paper Company; PAPER & GRAPHIC SUPPLY CENTERS;
Ibrands; Ibrands; Zellerbach; Nationwide Papers; Saalfeld Redistribution;
Saalfeld Paper Company; XPEDX; Hammermill Papers Kentucky; IBRANDS; Evegreen
Packaging Equipment; Dixon Paper Company; Dekalb – SRC; SRC; New Hanover – SRC;
Chatham – SRC; Fulton - Saalfeld Redistribution; Forsyth – SRC; Guilford – SRC;
Wake – SRC; Fulton – SRC; Fulton - Saalfeld Paper Company; Saalfeld
Redistribution Company; Western Paper Company; Xpedx; xpedx Printing
Technologies; Global Custom Services

 

32

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Exhibit III

Lock boxes; Collection Accounts; Collection Banks

DOMESTIC

[Text omitted but will be supplementally furnished to the Securities and
Exchange Commission upon request]

 

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Exhibit IV

Form of Compliance Certificate

This Compliance Certificate is furnished pursuant to that certain Receivables
Sale and Contribution Agreement dated as of March 13, 2008, between
International Paper Company (“IPCO”) and Red Bird Receivables, LLC (the
“Agreement”). Capitalized terms used and not otherwise defined herein are used
with the meanings attributed thereto in the Agreement.

THE UNDERSIGNED HEREBY CERTIFIES THAT:

1. I am the duly elected                                          of IPCO.

2. I have reviewed the terms of the Agreement and I have made, or have caused to
be made under my supervision, a detailed review of the transactions and
conditions of IPCO and its Subsidiaries during the accounting period covered by
the attached financial statements.

3. The examinations described in paragraph 2 did not disclose, and I have no
knowledge of, the existence of any condition or event which constitutes a
Termination Event or an Unmatured Termination Event, as each such term is
defined under the Agreement, during or at the end of the accounting period
covered by the attached financial statements or as of the date of this
Certificate[, except as set forth below].

[4. Described below are the exceptions, if any, to paragraph 3 by listing, in
detail, the nature of the condition or event, the period during which it has
existed and the action which IPCO has taken, is taking, or proposes to take with
respect to each such condition or event:                                        
 ].

The foregoing certifications, together with the computations set forth in
Schedule I hereto and the financial statements delivered with this Certificate
in support hereof, are made and delivered this      day of
                        , 200_.

 

 

[Name]

 

Exh I-34

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Exhibit V

Credit and Collection Policy

[Text omitted but will be supplementally furnished to the Securities and
Exchange Commission upon request]

 

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Exhibit VI

Form of Subordinated Note

SUBORDINATED NOTE

March 13, 2008

1. Note. FOR VALUE RECEIVED, the undersigned, Red Bird Receivables, LLC, a
Delaware limited liability company (“SPV”), hereby unconditionally promises to
pay to the order of International Paper Company, a New York corporation
(“IPCO”), in lawful money of the United States of America and in immediately
available funds, on or before the date following the Termination Date which is
one year and one day after the date on which (i) the Outstanding Balance of all
Receivables sold under the “Receivables Contribution and Sale Agreement”
referred to below has been reduced to zero and (ii) IPCO has paid to Buyer all
indemnities, adjustments and other amounts which may be owed thereunder in
connection with the Purchase thereunder (the “Collection Date”), the aggregate
unpaid principal sum outstanding of all “Subordinated Loans” made from time to
time by IPCO to SPV pursuant to and in accordance with the terms of that certain
Receivables Sale and Contribution Agreement dated as of March 13, 2008 between
IPCO and SPV (as amended, restated, supplemented or otherwise modified from time
to time, the “Receivables Contribution and Sale Agreement”). Reference to
Section 1.3 of the Receivables Contribution and Sale Agreement is hereby made
for a statement of the terms and conditions under which the loans evidenced
hereby have been and will be made. All terms which are capitalized and used
herein and which are not otherwise specifically defined herein shall have the
meanings ascribed to such terms in the Receivables Contribution and Sale
Agreement.

2. Interest. SPV further promises to pay interest on the outstanding unpaid
principal amount hereof from the date hereof until payment in full hereof at a
rate equal to the 1-month LIBOR rate published in The Wall Street Journal on the
first Business Day of each month (or portion thereof) during the term of this
Subordinated Note, computed for actual days elapsed on the basis of a year
consisting of 360 days and changing on the first business day of each month
hereafter (“LIBOR”); provided, however, that if SPV shall default in the payment
of any principal hereof, SPV promises to pay, on demand, interest at the rate
equal to LIBOR plus 2.00% per annum on any such unpaid amounts, from the date
such payment is due to the date of actual payment. Interest shall be payable on
the first Business Day of each month in arrears; provided, however, that SPV may
elect on the date any interest payment is due hereunder to defer such payment
and upon such election the amount of interest due but unpaid on such date shall
constitute principal under this Subordinated Note. The outstanding principal of
any loan made under this Subordinated Note shall be due and payable on the
Collection Date and may be repaid or prepaid at any time without premium or
penalty.

3. Principal Payments. IPCO is authorized and directed by SPV to enter on the
grid attached hereto, or, at its option, in its books and records, the date and
amount of each loan made by it which is evidenced by this Subordinated Note and
the amount of each payment of principal made by SPV, and absent manifest error,
such entries shall constitute prima facie

 

36

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evidence of the accuracy of the information so entered; provided that neither
the failure of IPCO to make any such entry or any error therein shall expand,
limit or affect the obligations of SPV hereunder.

4. Subordination. IPCO shall have the right to receive, and SPV shall make, any
and all payments and prepayments relating to the loans made under this
Subordinated Note, provided that, after giving effect to any such payment or
prepayment, the aggregate Outstanding Balance of Receivables (as each such term
is defined in the Credit and Security Agreement hereinafter referred to) owned
by SPV at such time exceeds the sum of (a) the Obligations (as defined in the
Credit and Security Agreement) outstanding at such time under the Credit and
Security Agreement, plus (b) the aggregate outstanding principal balance of all
loans made under this Subordinated Note. IPCO hereby agrees that at any time
during which the conditions set forth in the proviso of the immediately
preceding sentence shall not be satisfied, IPCO shall be subordinate in right of
payment to the prior payment of any indebtedness or obligation of SPV owing to
the Administrative Agent or any Lender under that certain Second Amended and
Restated Credit and Security Agreement, dated as of March 13, 2008 by and among
SPV, IPCO, as Servicer, various “Lenders” and “Co-Agents” from time to time
party thereto and Citicorp North America, Inc., as “Administrative Agent” for
such Lenders and Co-Agents (as amended, restated, supplemented or otherwise
modified from time to time, the “Credit and Security Agreement”). The
subordination provisions contained herein are for the direct benefit of, and may
be enforced by, the Administrative Agent and the Lenders and/or any of their
respective assignees (collectively, the “Senior Claimants”) under the Credit and
Security Agreement. Until the date on which the “Aggregate Principal”
outstanding under the Credit and Security Agreement has been repaid in full and
all other obligations of SPV and/or the Servicer thereunder and under the “Fee
Letter” referenced therein (all such obligations, collectively, the “Senior
Claim”) have been indefeasibly paid and satisfied in full, IPCO shall not
institute against SPV any proceeding of the type described in Section 5.1(d) of
the Receivables Contribution and Sale Agreement unless and until the Collection
Date has occurred. Should any payment, distribution or security or proceeds
thereof be received by IPCO in violation of this Section 4, IPCO agrees that
such payment shall be segregated, received and held in trust for the benefit of,
and deemed to be the property of, and shall be immediately paid over and
delivered to the Administrative Agent for the benefit of the Senior Claimants.

5. Bankruptcy; Insolvency. Upon the occurrence of any proceeding of the type
described in Section 5.1(d) of the Receivables Contribution and Sale Agreement
involving SPV as debtor, then and in any such event the Senior Claimants shall
receive payment in full of all amounts due or to become due on or in respect of
the Aggregate Principal and the Senior Claim (including “Interest” as defined
and as accruing under the Credit and Security Agreement after the commencement
of any such proceeding, whether or not any or all of such Interest is an
allowable claim in any such proceeding) before IPCO is entitled to receive
payment on account of this Subordinated Note, and to that end, any payment or
distribution of assets of SPV of any kind or character, whether in cash,
securities or other property, in any applicable insolvency proceeding, which
would otherwise be payable to or deliverable upon or with respect to any or all
indebtedness under this Subordinated Note, is hereby assigned to and shall be
paid or delivered by the Person making such payment or delivery (whether a
trustee in bankruptcy, a receiver, custodian or liquidating trustee or
otherwise) directly to the Administrative Agent for application to, or as
collateral for the payment of, the Senior Claim until such Senior Claim shall
have been paid in full and satisfied.

 

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6. Amendments. This Subordinated Note shall not be amended or modified except in
accordance with Section 7.1 of the Receivables Contribution and Sale Agreement.
The terms of this Subordinated Note may not be amended or otherwise modified
without the prior written consent of the Agent for the benefit of the Lenders.

7. GOVERNING LAW. THIS SUBORDINATED NOTE SHALL BE GOVERNED AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE
PRINCIPLES OF CONFLICTS OF LAWS THEREOF OTHER THAN SECTION 5-1401 OF THE GENERAL
OBLIGATIONS LAW (EXCEPT IN THE CASE OF THE OTHER TRANSACTION DOCUMENTS, TO THE
EXTENT OTHERWISE EXPRESSLY STATED THEREIN). WHEREVER POSSIBLE EACH PROVISION OF
THIS SUBORDINATED NOTE SHALL BE INTERPRETED IN SUCH MANNER AS TO BE EFFECTIVE
AND VALID UNDER APPLICABLE LAW, BUT IF ANY PROVISION OF THIS SUBORDINATED NOTE
SHALL BE PROHIBITED BY OR INVALID UNDER APPLICABLE LAW, SUCH PROVISION SHALL BE
INEFFECTIVE TO THE EXTENT OF SUCH PROHIBITION OR INVALIDITY, WITHOUT
INVALIDATING THE REMAINDER OF SUCH PROVISION OR THE REMAINING PROVISIONS OF THIS
SUBORDINATED NOTE.

8. Waivers. All parties hereto, whether as makers, endorsers, or otherwise,
severally waive presentment for payment, demand, protest and notice of dishonor.
IPCO additionally expressly waives all notice of the acceptance by any Senior
Claimant of the subordination and other provisions of this Subordinated Note and
expressly waives reliance by any Senior Claimant upon the subordination and
other provisions herein provided.

9. Assignment. This Subordinated Note may not be assigned, pledged or otherwise
transferred to any party other than IPCO without the prior written consent of
the Agent, and any such attempted transfer shall be void.

 

RED BIRD RECEIVABLES, LLC By:  

 

  David E. Arick, President

 

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Schedule

to

SUBORDINATED NOTE

SUBORDINATED LOANS AND PAYMENTS OF PRINCIPAL

 

DATE

 

AMOUNT OF

SUBORDINATED

LOAN

 

AMOUNT OF
PRINCIPAL

PAID

 

UNPAID

PRINCIPAL

BALANCE

 

NOTATION MADE
BY (INITIALS)

                                                               

 

39

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Exhibit VII

[Form of] Purchase Report

For the Calculation Period beginning [date] and ending [date]

TO: BUYER AND THE AGENT (AS BUYER’S ASSIGNEE)

 

Aggregate Outstanding Balance of all Receivables sold during the period:

  $                                A Less: Aggregate Outstanding Balance of all
Receivables sold during such period which were not Eligible Receivables on the
date when sold:   $ (                         )     (B) Equals: Aggregate
Outstanding Balance of all Eligible Receivables sold during the period (A– B):  
  $                            =C Less: Purchase Price discount during the
Period:   $ (                         )     (D) Equals: Gross Purchase Price
Payable during the period (C – D)     $                            =E Less:
Total Purchase Price Credits arising during the Period:   $
(                         )     (F) Equals: Net Purchase Price payable during
the Period (E – F):     $                            =G Cash Purchase Price Paid
to IPCO during the Period:   $                                H Subordinated
Loans made during the Period:   $                                I Less:
Repayments of Subordinated Loans received during the Period:   $
(                         )     (J)

Equals: Purchase Price paid in Cash or Subordinated Loans during the period

(H + I – J):

    $                            =K Aggregate Outstanding Balance of Receivables
contributed during the Period:   $                                L

 

40

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Schedule A

DOCUMENTS TO BE DELIVERED TO BUYER

ON OR PRIOR TO THE PURCHASE

 

1. Executed copies of the Receivables Sale and Contribution Agreement, duly
executed by the parties thereto.

 

2. Copy of the Credit and Collection Policy to attach to the Receivables Sale
and Contribution Agreement as an Exhibit.

 

3. A certificate of IPCO’s [Assistant] Secretary certifying:

(a) A copy of the Resolutions of the Board of Directors of IPCO, authorizing
IPCO’s execution, delivery and performance of the Receivables Sale and
Contribution Agreement and the other documents to be delivered by it thereunder;

(b) A copy of the Organizational Documents of IPCO (also certified, to the
extent that such documents are filed with any governmental authority, by the
Secretary of State of the jurisdiction of organization of IPCO on or within
thirty (30) days prior to closing);

(c) Good Standing Certificates for IPCO issued by the Secretaries of State of
its state of incorporation and each jurisdiction where it has material
operations; and

(d) The names and signatures of the officers authorized on its behalf to execute
the Receivables Sale and Contribution Agreement and any other documents to be
delivered by it thereunder.

 

4. Pre-filing state and federal tax lien, judgment lien and UCC lien searches
against IPCO from the State of New York.

 

5. Time stamped receipt copies of proper financing statements, duly filed under
the UCC on or before the date of the initial Purchase (as defined in the
Receivables Sale and Contribution Agreement) in all jurisdictions as may be
necessary or, in the opinion of Buyer (or its assigns), desirable, under the UCC
of all appropriate jurisdictions or any comparable law in order to perfect the
ownership interests contemplated by the Receivables Sale and Contribution
Agreement.

 

6. Time stamped receipt copies of proper UCC termination statements, if any,
necessary to release all security interests and other rights of any Person in
the Receivables, Contracts or Related Security previously granted by IPCO in
favor of anyone other than the Administrative Agent (or the administrative agent
under the Existing Agreement under and as defined in the Credit and Security
Agreement).

 

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7. Executed [Amendments to/Amendments and Restatements of] Collection Account
Agreements for each Lock Box and Collection Account.

 

8. A favorable opinion of legal counsel for IPCO licensed to give opinions under
New York law reasonably acceptable to Buyer (and the Administrative Agent, as
Buyer’s assignee) as to the following:

(a) IPCO is a corporation duly organized, validly existing, and in good standing
under the laws of the state of New York.

(b) IPCO has all requisite authority to conduct its business in each
jurisdiction where failure to be so qualified would have a material adverse
effect on IPCO’s business.

(c) The execution and delivery by IPCO of the Receivables Contribution and Sale
Agreement and each other Transaction Document to which it is a party and its
performance of its obligations thereunder have been duly authorized by all
necessary organizational action and proceedings on the part of IPCO and will
not:

(i) require any action by or in respect of, or filing with, any governmental
body, agency or official (other than the filing of UCC financing statements);

(ii) contravene, or constitute a default under, any provision of applicable law
or regulation or of its articles or certificate of incorporation or bylaws or of
any material agreement, judgment, injunction, order, decree or other instrument
binding upon IPCO; or

(iii) result in the creation or imposition of any Adverse Claim on assets of
IPCO or any of its Subsidiaries (except as contemplated by the Receivables Sale
and Contribution Agreement).

(d) The Receivables Sale and Contribution Agreement and each other Transaction
Document to which it is a party has been duly executed and delivered by IPCO and
constitutes the legally valid, and binding obligation of IPCO enforceable in
accordance with its terms, except to the extent the enforcement thereof may be
limited by bankruptcy, insolvency or similar laws affecting the enforcement of
creditors’ rights generally and subject also to the availability of equitable
remedies if equitable remedies are sought.

(e) In the event that the Receivables Sale and Contribution Agreement is held to
create a transfer for security purposes rather than a true sale or other
outright assignment, the provisions of the Receivables Sale and Contribution
Agreement are effective to create valid security interests in favor of Buyer in
all of IPCO’s right, title and interest in and to the Receivables and Related
Security described therein which constitute “accounts,” “chattel paper” or
“general intangibles” (each as defined in the UCC) (collectively, the “Opinion
Collateral”), as security for the payment of a loan deemed to have been made by
Buyer to IPCO in an amount equal to the Purchase Price (as defined therein) of
the Receivables (as defined therein), together with all other obligations of
Buyer thereunder.

 

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(f) Each of the UCC-1 Financing Statements naming IPCO as debtor, Buyer, as
secured party, and Administrative Agent, as assignee of secured party to be
filed in the Secretary of State of the State of New York’s office, is in
appropriate form for filing therein. Upon filing of such UCC-1 Financing
Statements in such filing offices and payment of the required filing fees, the
security interest in favor of Buyer in the Opinion Collateral will be perfected
and assigned of record to the Administrative Agent.

(g) Based solely on our review of the [describe UCC Search Reports], and
assuming (i) the filing of the Financing Statements and payment of the required
filing fees in accordance with paragraph (f) and (ii) the absence of any
intervening filings between the date and time of the Search Reports and the date
and time of the filing of the Financing Statements, the security interest of
Buyer in the Opinion Collateral is prior to any security interest granted in the
Opinion Collateral by IPCO, the priority of which is determined solely by the
filing of a financing statement in the Secretary of State of the State of New
York’s office.

(h) To the best of the opinion giver’s knowledge, there is no action, suit or
other proceeding against IPCO or any Affiliate of IPCO, which would materially
adversely affect the business or financial condition of IPCO and its Affiliates
taken as a whole or which would materially adversely affect the ability of IPCO
to perform its obligations under the Receivables Sale and Contribution
Agreement.

(i) IPCO is not an “investment company” as such term is defined in the
Investment Company Act of 1940, as amended.

 

9. A “true sale” opinion and “substantive consolidation” opinion of counsel for
IPCO with respect to the transactions contemplated by the Receivables
Contribution and Sale Agreement.

 

10. A Certificate of IPCO’s financial officer certifying that, as of the closing
date, no Termination Event or Unmatured Termination Event exists and is
continuing.

 

11. Executed copies of (i) all consents from and authorizations by any Persons
and (ii) all waivers and amendments to existing credit facilities, that are
necessary in connection with the Receivables Sale and Contribution Agreement.

 

12. Executed Subordinated Note by Buyer in favor of IPCO.

 

13. If applicable, a direction letter executed by IPCO authorizing Buyer (and
the Administrative Agent, as its assignee) and directing warehousemen to allow
Buyer (and the Administrative Agent, as its assignee) to inspect and make copies
from IPCO’s books and records maintained at off-site data processing or storage
facilities.

 

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SCHEDULE B

Receivables created by domestic sales of the following businesses:

 

•  

U.S. Printing Papers

 

•  

Consumer Packaging

 

•  

Industrial Packaging

 

•  

xpedx – Excluding the following:

 

  (i) Stores Division;

 

  (ii) Cincinnati Reading Road Division, location #679;

 

  (iii) Saalfeld Re-Distribution Business, location #680; and

 

  (iv) Honeywell International, Inc.

 

•  

U.S. Pulp

 

44