EXHIBIT 10.2

AMENDED AND RESTATED

RECEIVABLES SALE AGREEMENT

DATED AS OF OCTOBER 6, 2009

among

ARCH CHEMICALS, INC.,

as an Originator,

ARCH TREATMENT TECHNOLOGIES, INC.

as an Originator,

ARCH WOOD PROTECTION, INC.,

as an Originator,

ARCH PERSONAL CARE PRODUCTS, L.P.,

as an Originator,

and

ARCH CHEMICALS RECEIVABLES CORP.,

as Buyer

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TABLE OF CONTENTS

 

          Page Article I Amounts and Terms of the Purchase    4

Section 1.1

   Initial Contribution of Receivables    4

Section 1.2

   Purchase of Receivables    4

Section 1.3

   Payment for the Purchase    5

Section 1.4

   Purchase Price Credit Adjustments    7

Section 1.5

   Payments and Computations, Etc.    8

Section 1.6

   Transfer of Records    8

Section 1.7

   Characterization    9

Section 1.8

   Letters of Credit    9 Article II Representations and Warranties    10

Section 2.1

   Representations and Warranties of each Originator    10 Article III
Conditions of Purchase    14

Section 3.1

   Conditions Precedent to Purchase    14

Section 3.2

   Conditions Precedent to Subsequent Purchases    14 Article IV Covenants    15

Section 4.1

   Affirmative Covenants of Originators    15

Section 4.2

   Negative Covenants of Originators    20 Article V Termination Events    21

Section 5.1

   Termination Events    21

Section 5.2

   Remedies    23 Article VI Indemnification    24

Section 6.1

   Indemnities by Originators    24

Section 6.2

   Other Costs and Expenses    26 Article VII Miscellaneous    26

Section 7.1

   Waivers and Amendments    26

Section 7.2

   Notices    26

Section 7.3

   Protection of Ownership Interests of Buyer    27

Section 7.4

   Confidentiality    28

Section 7.5

   Bankruptcy Petition    29

Section 7.6

   Limitation of Liability    29

Section 7.7

   CHOICE OF LAW    29

Section 7.8

   CONSENT TO JURISDICTION    30

Section 7.9

   WAIVER OF JURY TRIAL    30

Section 7.10

   Integration; Binding Effect; Survival of Terms    30

Section 7.11

   Counterparts; Severability; Section References    31

 

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Exhibits

 

Exhibit I

  Definitions

Exhibit II

  Jurisdiction of Organization; 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 Schedules  

Schedule A

  List of Documents to Be Delivered to Buyer on or Prior to the Purchase

Schedule 1.1

  Initial Contributed Receivables

 

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RECEIVABLES SALE AGREEMENT

THIS RECEIVABLES SALE AGREEMENT, dated as of October 6, 2009, is by and among
ARCH CHEMICALS, INC., a Virginia corporation, ARCH TREATMENT TECHNOLOGIES, INC.,
a Virginia corporation, ARCH WOOD PROTECTION, INC., a Delaware corporation, ARCH
PERSONAL CARE PRODUCTS, L.P., a New Jersey limited partnership (each, an
“Originator” and collectively, the “Originators”), and ARCH CHEMICALS
RECEIVABLES CORP., a Delaware corporation (“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 Purchase
Agreement).

PRELIMINARY STATEMENTS

The Originators and the Seller are parties to that certain Receivables Sale
Agreement dated as of June 27, 2005 as amended, supplemented or otherwise
modified through the date hereof (the “Existing Agreement”).

The parties hereto wish to amend and restate the Existing Agreement on the terms
set forth herein.

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

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

Following the purchase of Receivables from the Originators, Buyer will sell the
Receivables, the associated Related Security and Collections pursuant to that
certain Amended and Restated Receivables Purchase Agreement dated as of
October 6, 2009 (as the same may from time to time hereafter be amended,
supplemented, restated or otherwise modified, the “Purchase Agreement”) among
Buyer, Arch Chemicals, Inc. (“Arch Chemicals”), as initial Servicer, Market
Street Funding LLC (“Market Street”), PNC Bank, National Association (“PNC”), as
agent and administrator pursuant to the terms of the Purchase Agreement (in such
capacity, the “Administrator”) and PNC, as LC Bank (in such capacity, the “LC
Bank”).

 

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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 Initial Contribution of Receivables.

On June 27, 2005 (the “Initial Cutoff Date”), each Originator contributed,
assigned, transferred, set-over and otherwise conveyed to Buyer, and Buyer
accepted from such Originator, Receivables originated by such Originator and
existing as of the close of business on the Business Day immediately prior to
the Initial Cutoff Date having an aggregate Outstanding Balance in the amount
set forth on Schedule 1.1 (the “Initial Contributed Receivables”), together with
all Related Security relating thereto and all Collections thereof.

Section 1.2 Purchase of Receivables.

(a)(i) Effective on the Initial Cutoff Date, in consideration for the Purchase
Price and upon the terms and subject to the conditions set forth in the Existing
Agreement, each Originator thereby sold, assigned, transferred, set-over and
otherwise conveyed to Buyer, without recourse (except to the extent expressly
provided therein), and Buyer thereby purchased from each Originator, all of such
Originator’s right, title and interest in and to all Receivables existing as of
the close of business on the Initial Cutoff Date (other than the Initial
Contributed Receivables) and all Receivables thereafter arising through and
immediately prior to the date hereof, together, in each case, with all Related
Security relating thereto and all Collections thereof. In accordance with the
preceding sentence, on the Initial Cutoff Date Buyer acquired all of each
Originators’ right, title and interest in and to all Receivables existing as of
the Initial Cutoff Date and thereafter arising through and the date immediately
prior to the date hereof, together with all Related Security relating thereto
and all Collections thereof. Buyer was obligated to pay the Purchase Price for
the Receivables purchased hereunder in accordance with Section 1.3 of the
Existing Agreement.

(ii) Effective on the date hereof, in consideration for the Purchase Price and
upon the terms and subject to the conditions set forth herein, each Originator
does hereby sell, assign, transfer, set-over and otherwise convey to Buyer,
without recourse (except to the extent expressly provided herein), and Buyer
does hereby purchase from each Originator, all of such Originator’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 each Originators’ 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 Monthly Reporting Date, each Originator shall (or shall require the
Servicer to) deliver to Buyer a report containing substantially the same
information as the form of report set forth in Exhibit VII hereto (each such
report being herein called a “Purchase Report”) with respect to the Receivables
sold by each Originator to Buyer

 

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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 each
Originator deliver, and each Originator 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 under the Existing Agreement and hereunder shall constitute a sale and/or
contribution, which sale and/or contribution, as the case may be, 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 under the Existing Agreement was made and the Sale of
Receivables hereunder is made without recourse to any Originator; provided,
however, that (i) each Originator shall be liable to Buyer for all
representations, warranties, covenants and indemnities made by such Originator
pursuant to the terms of the Transaction Documents to which such Originator 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 any
Originator or any other Person arising in connection with the Receivables, the
related Contracts and/or other Related Security or any other obligations of any
Originator. In view of the intention of the parties hereto that the Purchase of
Receivables made under the Existing Agreement and hereunder shall constitute a
sale of such Receivables rather than loans secured thereby, each Originator
agrees that it will, on or prior to the date hereof and in accordance with
Section 4.1(e)(iii), mark its master data processing system and all accounts
receivable reports generated thereby with a legend reasonably acceptable to
Buyer and to the Administrator (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 absolutely transferred to
Buyer. Upon the request of Buyer or the Administrator (as Buyer’s assignee),
each Originator 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 Administrator
(as Buyer’s assignee) may reasonably request; provided, however, that unless and
until an Amortization Event or an Unmatured Amortization Event has occurred,
none of the Originators shall be required to take any actions to establish,
maintain or perfect the Buyer’s ownership interest in the Related Security other
than the filing of financing statements under the UCC of all appropriate
jurisdictions.

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 Initial Cutoff Date (other than the Initial Contributed
Receivables) was paid in full by Buyer to each Originator on June 27, 2005, and
was paid to each Originator in the following manner:

(i) by delivery of immediately available funds, to the extent of funds on hand
to Buyer or made available to Buyer in connection with its subsequent sale of an
interest in such Receivables to Three Pillars Funding, LLC (“TPF”) under the
Receivables Purchase Agreement dated as of June 27, 2005 (as

 

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amended, supplemented and modified through the date hereof among Buyer,
Servicer, TPF and SunTrust Robinson Humphrey, Inc. (formerly known as SunTrust
Capital Markets), as administrator; provided that a portion of such funds was
offset by amounts such Originator agreed to make as capital contributions such
that after giving effect thereto, the Buyer’s Net Worth was not less than the
Required Capital Amount, and

(ii) the balance, by delivery of the proceeds of the related subordinated
revolving loan from such Originator to Buyer (each, a “Subordinated Loan” and
collectively, the “Subordinated Loans”) in an amount not to exceed the lesser of
(A) the remaining unpaid portion of such Purchase Price and (B) the maximum
Subordinated Loan that could be borrowed without rendering Buyer’s Net Worth
less than the Required Capital Amount. Each Originator is hereby authorized by
Buyer to endorse on the schedule attached to the related 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 and purchased by
the Buyer after the Initial Cutoff Date shall be due and owing in full by Buyer
to the related Originator 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 such Originator to Buyer
under the Existing Agreement and hereunder and which have become due but remain
unpaid) and shall be paid to such Originator in the manner provided in the
following paragraphs (b), (c) and (d).

(b) With respect to any Receivables coming into existence after the Initial
Cutoff Date, on each Settlement Date, Buyer shall pay, to the relevant
Originator, 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 subsequent sale of an interest in the Receivables to
Market Street under the Purchase Agreement or other cash on hand;

second, if such Originator has requested a Letter of Credit pursuant to
Section 1.8, by Buyer’s obtaining and delivering such Letter of Credit; and

third, either (i) by delivery of the proceeds of the related 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) or (ii) unless such Originator 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), each Originator
irrevocably agrees to advance each related 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 the
related Subordinated Note and shall be payable solely from funds which Buyer is
not required under the Purchase Agreement to set aside for the benefit of, or
otherwise pay over to, Market Street.

 

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(c) From and after the Termination Date, no Originator shall 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, in either case, such Originator 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 Purchase 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 Initial Cutoff Date shall be due and payable in full by Buyer to the related
Originator on the date such Receivable came into existence, settlement of the
Purchase Price between Buyer and such Originator 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 such Originator 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 related Subordinated Note
made pursuant to Section 1.3 and any contribution of capital by an Originator 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 or cancelled as a result of any defective or rejected goods or
services, any cash discount or any other adjustment or otherwise by any
Originator or any Affiliate thereof, or as a result of any governmental or
regulatory action, or,

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

(iii) reduced on account of the obligation of any Originator or any Affiliate
thereof to pay to the related Obligor any rebate or refund; or

(iv) less than the amount included in calculating the Outstanding Balance for
purposes of any Purchase Report (for any reason other than such Receivable
becoming a Defaulted Receivable or payment in full of the entire Outstanding
Balance being made on such Receivable); or

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

 

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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,
in the case of clause (a) above, the amount of such reductions relating to such
Receivable and, in the case of clause (b) above, 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 the related Originator shall
pay the remaining amount of such Purchase Price Credit in cash immediately,
provided that if the Termination Date has not occurred, such Originator shall be
allowed to deduct the remaining amount of such Purchase Price Credit from any
indebtedness owed to it under its Subordinated Note.

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 the related Originator designated from time to
time by such Originator or as otherwise directed by such Originator. 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, each Originator
hereby sells, transfers, assigns and otherwise conveys to Buyer all of such
Originator’s right and title to and interest in the Records relating to all
Receivables sold or contributed by it hereunder, without the need for any
further documentation in connection with the Purchase (it being understood and
agreed that any Records that are not freely assignable (whether by express
provision or by virtue of confidentiality provisions) according to their terms
are excluded from such sale, transfer, assignment or conveyance; provided, that
upon reasonable request of the Buyer (or its assigns), the applicable Originator
will use its reasonable efforts to obtain consent to the assignment from the
relevant counterparty). In connection with such transfer, each Originator hereby
grants to each of Buyer, the Administrator and the Servicer an irrevocable,
non-exclusive license to use, without royalty or payment of any kind, all
software used by such Originator to account for the Receivables, to the extent
necessary to administer the Receivables, whether such software is owned by such
Originator or is owned by others and used by such Originator 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, the applicable Originator hereby agrees that upon the
reasonable request of Buyer (or Buyer’s assignee), such Originator 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 Aggregate Unpaids, and shall terminate on the date this Agreement
terminates in accordance with its terms.

 

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(b) Each Originator (i) shall take such action requested by Buyer and/or the
Administrator (as Buyer’s assignee), from time to time hereafter, that may be
reasonably necessary or appropriate to ensure that Buyer and its assigns under
the Purchase Agreement have an enforceable ownership interest in the Records
relating to the Receivables purchased from the Originators hereunder; provided,
however, that the applicable Originator shall not be required to take any
actions with respect to its Records other than those required by Sections 1.6(a)
and 4.1(e) hereto unless and until an Unmatured Amortization Event has occurred,
and (ii) shall use its reasonable efforts to ensure that Buyer, the
Administrator and the Servicer 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 any Originator to Buyer of Receivables hereunder
shall be characterized as a secured loan and not a sale or contribution or such
sale or contribution, as the case may be, 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, each Originator hereby grants to
Buyer a security interest in all of such Originator’s right, title and interest,
whether now owned or hereafter acquired, in, to and under all Receivables now
existing and hereafter arising, all Collections and Related 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 such Originator hereunder, 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.

Section 1.8 Letters of Credit.

(a) Upon the request of any Originator and in accordance with Section 1.3, and
subject to the terms and conditions for issuing Letters of Credit under the
Purchase Agreement (including any limitations therein on the amount of any such
issuance), the Buyer agrees to cause the LC Bank to issue, on any Business Day
specified by such Originator, Letters of Credit on behalf of the Buyer (and, if
applicable, on behalf of, or for the account of, any Originator in favor of such
beneficiaries as such Originator may elect). The aggregate stated amount of the
Letters of Credit being issued on any Business Day shall constitute a credit
against the aggregate Purchase Price otherwise payable by the Buyer on such
Business Day pursuant to Section 1.3. To the extent that the aggregate stated
amount of the Letters of Credit being issued on any Business Day exceeds the
aggregate Purchase Price payable by the Buyer on such Business Day, such excess
shall be deemed to be a reduction in the outstanding principal balance of (and,
to the extent necessary, the accrued but unpaid interest on) the applicable
Subordinated Note. The aggregate stated amount of Letters of Credit to be issued
to any Originator on any Business Day cannot exceed the sum of the aggregate
Purchase Price payable on such Business Day to such Originator plus the
aggregate outstanding principal balance of

 

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and accrued but unpaid interest on the Subordinated Note related to such
Originator on such Business Day. In the event that any Letter of Credit issued
(i) expires or is cancelled or otherwise terminated with all or any portion of
its stated amount undrawn, (ii) has its stated amount decreased (for a reason
other than a drawing having been made thereunder) or (iii) the Buyer’s
Reimbursement Obligation in respect thereof is reduced for any reason other than
by virtue of a payment made in respect of a drawing thereunder, then an amount
equal to such undrawn amount or such reduction, as the case may be, shall be
paid (i) in cash to such Originator on the next Business Day and (ii) by adding
such amount not paid in cash pursuant to subclause (i) above to the outstanding
principal amount of the Subordinated Note issued to such Originator.

(b) In the event that any Originator requests a Letter of Credit hereunder, such
Originator shall on a timely basis provide the Buyer with such information as is
necessary for the Buyer to obtain such Letter of Credit from the LC Bank.

(c) Each Originator agrees to be bound by the terms of each Letter of Credit
Application referenced in the Purchase Agreement and by the LC Bank’s
interpretations of any Letter of Credit issued for the Buyer and by the LC
Bank’s written regulations and customary practices relating to letters of
credit.

Article II

Representations and Warranties

Section 2.1 Representations and Warranties of each Originator.

Each Originator with respect to itself, 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. Such Originator’s jurisdiction of organization is
correctly set forth in Exhibit II to this Agreement and such jurisdiction is its
sole jurisdiction of organization. Such Originator is duly organized under the
laws of its jurisdiction of organization and is a “registered organization” as
defined in the UCC in effect in such jurisdiction. Such Originator is validly
existing and in good standing under the laws of its jurisdiction of
organization, and no other state or jurisdiction, and as to which such state or
jurisdiction must maintain a public record showing the organization to have been
organized. Such Originator is 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 such Originator of this Agreement and each other
Transaction Document to which it is a party, and the performance of its
obligations hereunder and thereunder and, such Originator’s use of the proceeds
of the Purchase made hereunder,

 

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are within its organizational powers and authority and have been duly authorized
by all necessary organizational action on its part. This Agreement and each
other Transaction Document to which such Originator is a party has been duly
executed and delivered by such Originator.

(c) No Conflict. The execution and delivery by such Originator of this Agreement
and each other Transaction Document to which it is a party, and the performance
of its obligations hereunder and thereunder do not contravene or violate (i) its
Organizational Documents, (ii) any law, rule or regulation applicable to it,
(iii) 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 (iv) any order,
writ, judgment, award, injunction or decree binding on or affecting it or its
property, and do not result in the creation or imposition of any Adverse Claim
on assets of such Originator or its Subsidiaries (except as created hereunder)
except, in any case, 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 or filing with, any governmental authority or regulatory body
is required for the due execution and delivery by such Originator of this
Agreement and each other Transaction Document to which it is a party and the
performance of its obligations hereunder and thereunder.

(e) Actions, Suits. There are no actions, suits or proceedings pending, or to
the best of such Originator’s knowledge, threatened, against it, 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. Such Originator is not
in default with respect to any order of any court, arbitrator or governmental
body which default could reasonably be expected to have a Material Adverse
Effect.

(f) Binding Effect. This Agreement and each other Transaction Document to which
such Originator is a party constitute the legal, valid and binding obligations
of such Originator enforceable against such Originator 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. All information (other than any projection or other
forward-looking information) heretofore furnished by such Originator or any of
its Affiliates to Buyer (or its assigns) for purposes of or in connection with
this Agreement, any of the other Transaction Documents or any transaction
contemplated hereby or thereby is, and all such information (other than any
projection or other forward-looking information) hereafter furnished by such
Originator or any of its Affiliates to Buyer (or its assigns) will be, true and
accurate in every material respect on the date such information is stated or
certified and does not and will not contain any material misstatement of fact.

 

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(h) Use of Proceeds. No portion of any Purchase Price payment hereunder will be
used by such Originator (i) for a purpose that violates, or would be
inconsistent with, any law, rule or regulation applicable to such Originator or
(ii) 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 other than the
repurchase of equity securities of Arch Chemicals so long as such repurchase
does not violate Sections 12, 13 or 14 of the Securities Exchange Act of 1934,
as amended.

(i) Good Title. Immediately prior to the Purchase hereunder and upon the
creation of each Receivable coming into existence after the Initial Cutoff Date,
such Originator (i) is the legal and beneficial owner of the Receivables created
by it and (ii) is the legal and beneficial owner of the Related Security with
respect thereto, 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 such Originator’s
ownership interest in each Receivable, its Collections, “Supporting Obligations”
(as defined in Article 9 of the UCC in effect in each relevant jurisdiction),
each Originator’s right, title and interest in, to and under each of the
Transaction Documents to which it is a party, returned goods the sale of which
gave rise to any Receivable, security interests in favor of any Originator that
secure payment of such Receivable and all other items of Related Security in
which an interest therein may be perfected by the filing of a financing
statement under Article 9 of the UCC and proceeds of the foregoing.

(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 such Originator) (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 such
Originator’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, its Collections, “Supporting Obligations”
(as defined in Article 9 of the UCC in effect in each relevant jurisdiction),
each Originator’s right, title and interest in, to and under each of the
Transaction Documents to which it is a party, returned goods the sale of which
gave rise to any Receivable, security interests in favor of any Originator that
secure payment of such Receivable and all other items of Related Security in
which an interest therein may be perfected by the filing of a financing
statement under Article 9 of the UCC and proceeds of the foregoing. Such
Originator’s jurisdiction of organization is a jurisdiction whose law generally
requires information concerning the existence of a nonpossessory security
interest to be made generally available in a filing, record or registration
system as a condition or result of such a security interest’s obtaining priority
over the rights of a lien creditor which respect to collateral.

(k) Places of Business and Locations of Records. The principal places of
business of such Originator and the offices where it keeps all of its Records
are located at the address(es) listed on Exhibit II. Such Originator’s Federal
Employer Identification Number is correctly set forth on Exhibit II.

 

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(l) Collections. The conditions and requirements set forth in subclause (i) of
Section 4.1(i) have at all times since the Initial Cutoff Date, been satisfied
and duly performed. The conditions and requirements set forth in subclause
(ii) of Section 4.1(i) have been satisfied from and after the Initial Cutoff
Date. The names and addresses of all Collection Banks, together with the account
numbers of the Collection Accounts of such Originator at each Collection Bank
and the post office box number of each Lock-Box, are listed on Exhibit III. Such
Originator 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 June 30, 2009, no event has occurred that
would have a Material Adverse Effect.

(n) Names. The name in which such Originator has executed this Agreement is
identical to the name of such Originator as indicated on the public record of
its state of organization which shows such Originator to have been organized. In
the past five (5) years, such Originator 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. Arch Chemicals 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 a Holding Company or an Investment Company. Such Originator is not a
“holding company” or a “subsidiary holding company” of a “holding company”
within the meaning of the Public Utility Holding Company Act of 1935, as
amended, or any successor statute. Such Originator 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. Such Originator has complied in all respects with all
applicable laws, rules, regulations, orders, writs, judgments, injunctions,
decrees or awards to which it may be subject, except where the failure to so
comply could not reasonably be expected to have a Material Adverse Effect. Each
Receivable, together with the 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), and no part of such Contract is in violation of any such law, rule
or regulation, except where such contravention or violation could not reasonably
be expected to have a Material Adverse Effect.

(r) Compliance with Credit and Collection Policy. Such Originator 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 material 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).

 

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(s) Payments to Originator. With respect to each Receivable transferred to Buyer
hereunder, the Purchase Price received by such Originator constitutes reasonably
equivalent value in consideration therefor and such transfer was not made for or
on account of an antecedent debt. No transfer by such Originator 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) Enforceability of Contracts. Each Contract with respect to each Receivable
is effective to create, and has created, a legal, valid and binding obligation
of the related Obligor to pay the Outstanding Balance of the Receivable created
thereunder and any accrued interest thereon, enforceable against the Obligor in
accordance with its 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).

(u) 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.

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

(w) Contract Provisions. Except for customary adjustments in the ordinary course
of business, no Contract with respect to any Receivable contains provisions that
either (i) permit or provide for any reduction in the Outstanding Balance of the
Receivable created thereunder and any accrued interest thereon or (ii) could
otherwise hinder the ability to receive Collections with respect to such
Receivable.

Article III

Conditions of Purchase

Section 3.1 Conditions Precedent to Purchase.

The Purchase on the Initial Cutoff Date under this Agreement is subject to the
conditions precedent that (a) Buyer shall have been capitalized with the Initial
Contributed Receivables, (b) Buyer shall have received on or before the Closing
Date those documents listed on Schedule A and (c) all of the conditions to the
initial purchase under the Purchase Agreement shall have been satisfied or
waived in accordance with the terms thereof.

Section 3.2 Conditions Precedent to Subsequent Purchases.

Each Purchase after the Initial Cutoff Date shall be subject to the further
conditions precedent that: (a) the Facility Termination Date shall not have
occurred under the Purchase Agreement; (b) Buyer (or its assigns) shall have
received such other approvals, opinions or

 

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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 each Originator 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, except to the extent such representations and warranties
are expressly limited to an earlier 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, by delivery of a Letter of
Credit, through an increase in the amounts outstanding under the related
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 any Originator to satisfy any of the foregoing
conditions precedent, however, shall give rise to a right of Buyer to rescind
the related purchase and direct such Originator 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 Originators.

Until the date on which this Agreement terminates in accordance with its terms,
each Originator, with respect to itself hereby covenants as set forth below:

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

(i) Annual Reporting. Within 90 days after the close of each of its fiscal
years, audited, unqualified consolidated financial statements (which shall
include balance sheets, statements of income and retained earnings and a
statement of cash flows) for Arch Chemicals and its consolidated Subsidiaries
for such fiscal year certified in a manner acceptable to Buyer (or its assigns)
by KPMG LLP, independent public accountants or any other independent public
accountants of recognized national standing.

(ii) Quarterly Reporting. Within 45 days after the close of the first three
(3) quarterly periods of each of its respective fiscal years, balance sheets of
Arch Chemicals and its consolidated Subsidiaries as at the close of each such
period and consolidated statements of income and a statement of cash flows for
Arch Chemicals and its Subsidiaries for the period from the beginning of such
fiscal year to the end of such quarter, all certified by its chief financial
officer, principal accounting officer, treasurer or corporate controller.

 

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

(iv) Shareholders Statements and Reports. Promptly after becoming publicly
available to the shareholders of such Originator, copies of all financial
statements, reports and proxy statements furnished to them.

(v) S.E.C. Filings. Promptly after becoming publicly available, copies of all
registration statements and annual, quarterly, monthly or other regular reports
which such Originator or any of its Subsidiaries files with the Securities and
Exchange Commission.

(vi) Copies of Notices. Promptly upon its receipt of any notice, request for
consent, financial statements, certification, report or other communication
under or in connection with any Transaction Document from any Person other than
Buyer, the Administrator, Market Street or the LC Bank, copies of the same if
such notice, request, consent, financial statements, certification, report or
other communication can reasonably be expected to have an adverse effect on the
Receivables, the Related Security or the Buyer’s (or its assigns) rights
therein.

(vii) 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 Administrator’s, as Buyer’s
assignee) consent thereto.

(viii) Other Information. Promptly, from time to time, such other information,
documents, records or reports relating to (i) the financial condition or
operations of such Originator 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 or (ii) the Receivables as the Buyer
(or its assigns) may reasonably request.

Information required to be delivered pursuant to paragraphs (i), (ii), (iv) and
(v) of this Section 4.1(a) shall be deemed to have been delivered by the date
indicated therein, provided that such information has been filed with the
Securities and Exchange Commission by such date; provided further that the
Originator shall deliver paper copies of the statements, reports, financial
statements and other information referred to in paragraph (i), (ii), (iv) and
(v) of this Section 4.1(a) to the Buyer promptly upon request following such
filing.

 

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(b) Notices. Such Originator will notify Buyer (or its assigns) in writing of
any of the following promptly upon learning of the occurrence thereof,
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 such Originator.

(ii) Judgment and Proceedings. (A) The entry of any judgment or decree against
such Originator or any of its Subsidiaries if the amount of such judgment or
decree then outstanding against such Originator and its Subsidiaries exceeds
$10,000,000 after deducting (1) the amount with respect to which such Originator
or any such Subsidiary is insured and with respect to which the insurer has not
disclaimed responsibility in writing, and (2) the amount for which such
Originator or any such Subsidiary is otherwise indemnified if the terms of such
indemnification are satisfactory to Buyer (or its assigns), and (B) the
institution of any litigation, arbitration proceeding or governmental proceeding
against such Originator 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 that could
lead to an event of default or an event of default under any other financing
arrangement in a principal amount greater than or equal to $10,000,000 pursuant
to which such Originator is a debtor or an obligor.

(c) Compliance with Laws and Preservation of Existence. Such Originator will
comply in all respects with all applicable laws, rules, regulations, orders,
writs, judgments, injunctions, decrees or awards to which it may be subject,
except where the failure to so comply could not reasonably be expected to have a
Material Adverse Effect. Such Originator will preserve and maintain its legal
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. Notwithstanding the preceding
sentence, it is expressly understood and agreed that any Originator may merge or
consolidate with, or transfer all or substantially all of its assets to, any
other Originator, so long as Buyer (or its assigns) shall have received such
approvals, opinions or documents as it may reasonably request.

(d) Audits. In addition to information that may be required pursuant to
Section 4.1(a)(viii), each Originator will furnish to Buyer (or its assigns)
from time to time such information with respect to it and the Receivables as
Buyer (or its assigns) may reasonably request. Each Originator 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 such Originator, 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

 

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possession or under the control of such Originator relating to the Receivables
and the Related Security, including, without limitation, the related Contracts
(other than any Confidential Contract (except for any Confidential Contract as
to which the related Obligor has consented to such disclosure or which may be
disclosed to others who are subject to a confidentiality agreement) as to which
the disclosure thereof cannot be satisfied by the execution and delivery of a
confidentiality agreement), and (ii) to visit the offices and properties of such
Originator for the purpose of examining such materials described in clause
(i) above, and to discuss matters relating to such Originator’s financial
condition or the Receivables and the Related Security or such Originator’s
performance under any of the Transaction Documents or such Originator’s
performance under the Contracts and, in each case, with any of the officers or
employees of Originator having knowledge of such matters (each of the foregoing
examinations and visits, a “Review”); provided, however, that so long as no
Termination Event has occurred and is continuing, (A) such Originator 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.

(e) Keeping and Marking of Records and Books.

(i) Such Originator 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, in each such case as 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). Such Originator
will give Buyer (or its assigns) notice of any material change in the
administrative and operating procedures referred to in the previous sentence.

(ii) Such Originator will on or prior to the date hereof, mark its master data
processing system and all accounts receivable reports generated thereby with a
legend, reasonably acceptable to Buyer (or its assigns), describing Buyer’s
ownership interests in the Receivables and further describing the interests in
the Receivables of the Administrator (on behalf of Market Street and the LC Bank
and their assigns) under the Purchase Agreement.

(f) Compliance with Contracts and Credit and Collection Policy. Such Originator
will timely and fully (i) perform and comply in all material respects with all
provisions, covenants and other promises required to be observed by it under the
Contracts related to the Receivables, in each case to the same extent as though
such Contracts had not been transferred to the Buyer, but only to the extent
there would not be an adverse effect upon the Receivables, and (ii) comply in
all material respects with the Credit and Collection Policy in regard to each
Receivable and the related Contract.

(g) Ownership. Such Originator 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 such Originator’s right, title and interest
in the Related Security associated with the Receivables, in each case, free and
clear of any Adverse Claims other

 

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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 action to perfect, protect or more fully evidence
the interest of Buyer as Buyer (or its assigns) may reasonably request);
provided, however, that unless and until an Amortization Event or an Unmatured
Amortization Event has occurred, none of the Originators shall be required to
take any actions to establish, maintain or perfect the Buyer’s ownership
interest in the Related Security other than the filing of financing statements
under the UCC of all appropriate jurisdictions.

(h) Market Street’s and LC Bank’s Reliance. Such Originator acknowledges that
the Administrator, Market Street and the LC Bank are entering into the
transactions contemplated by the Purchase Agreement in reliance upon Buyer’s
identity as a legal entity that is separate from such Originator and any
Affiliates thereof. Therefore, from and after the date of execution and delivery
of this Agreement, such Originator will take all 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 such Originator and any Affiliates
thereof and not just a division of such Originator or any such Affiliate.
Without limiting the generality of the foregoing and in addition to the other
covenants set forth herein, such Originator (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” set forth in Section 7.1(i) of the Purchase
Agreement and (iii) will cause all tax liabilities arising in connection with
the transactions contemplated herein or otherwise to be allocated between such
Originator 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.

(i) Collections. Such Originator will cause (i) all proceeds from all Lock-Boxes
to be directly deposited by a Collection Bank into a Collection Account and
(ii) 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 such Originator or any
Affiliate of such Originator, such Originator 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, such Originator will itself hold or, if
applicable, will cause such payments to be held in trust for the exclusive
benefit of Buyer and its assigns. Such Originator 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 Purchase Agreement.

(j) Taxes. Such Originator 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

 

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good faith by appropriate proceedings and for which adequate reserves in
accordance with GAAP shall have been set aside on its books. Such Originator
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 Originators.

Until the date on which this Agreement terminates in accordance with its terms,
each Originator, with respect to itself, hereby covenants that:

(a) Change in Name, Jurisdiction of Organization. Such Originator will not
change (i) its name as it appears in official filings in the jurisdiction of its
organization, (ii) its status as a “registered organization” (within the meaning
of Article 9 of any applicable enactment of the UCC) in such jurisdiction,
(iii) its organizational identification number, if any, issued by its
jurisdiction of organization, or (iv) its jurisdiction of organization unless it
shall have: (A) given Buyer (or its assigns) at least thirty (30) days’ prior
written notice thereof and (B) delivered to Buyer (or its assigns) all financing
statements, instruments and other documents requested by Buyer (or its assigns)
in connection with such change or relocation.

(b) Change in Payment Instructions to Obligors. Such Originator 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
such Originator may make changes in instructions to Obligors 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. Such Originator
will not make any material change or material amendment to the Credit and
Collection Policy unless, at least 30 days prior to such material change or
material amendment, it has delivered to the Buyer (or its assigns) a copy of the
Credit and Collection Policy then in effect and notice (i) indicating such
proposed change or amendment, and (ii) if such proposed change 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 Administrator’s, as Buyer’s assignee) consent thereto. Except as
otherwise permitted in its capacity as Servicer pursuant to the Purchase
Agreement, Originator will not extend, amend or otherwise modify the terms of
any Receivable or Contract related thereto other than in accordance with the
Credit and Collection Policy.

(d) Sales, Liens. Such Originator 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

 

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Lock-Box or Collection Account, or assign any right to receive income with
respect thereto (other than, in each case, (i) the creation of the interests
therein in favor of Buyer (and its assigns) provided for herein or in any other
Transaction Document and (ii) in connection with any transaction permitted by
Section 4.1(c)), and such Originator 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 such Originator. Such Originator shall
not create or suffer to exist any mortgage, pledge, security interest,
encumbrance, lien, charge or other similar arrangement on any of its inventory
the sale of which gives rise to any Receivable.

(e) Accounting for Purchase. Such Originator will not, and will not permit any
Affiliate to, account for the transactions contemplated hereby in any manner
other than the sale or capital contributions of the Receivables and the Related
Security by such Originator to Buyer or in any other respect account for or
treat the transactions contemplated hereby in any manner other than as a sale or
contribution of the Receivables and the Related Security by such Originator to
Buyer except (i) to the extent that such transactions are not recognized on
account of consolidated financial reporting in accordance with generally
accepted accounting principles and (ii) in accordance with applicable tax
principles, each Purchase and contribution is ignored for tax reporting
purposes.

(f) Contract Provisions. Except for customary adjustments in the ordinary course
of business, such Originator will not permit any Contract with respect to any
Receivable to contain provisions that either (i) permit or provide for any
reduction in the Outstanding Balance of the Receivable created thereunder and
any accrued interest thereon or (ii) could otherwise hinder the ability to
receive Collections with respect to such Receivable.

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) Any Originator shall fail (i) to make any payment or deposit required
hereunder when due and such failure shall continue for three (3) consecutive
Business Days, or (ii) to perform or observe any term, covenant or agreement
hereunder (other than as referred to in clause (i) 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.

(b)(i) Any representation or warranty made by any of the Originators in this
Agreement or the Receivables Purchase Agreement shall prove to have been
incorrect in any respect when made or deemed made, (ii) any information
contained in any Monthly Report shall prove to have been incorrect in any
respect when made, or (iii) any

 

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representation, warranty, certification or statement (other than relating to
projections or other forward-looking information) made by any of the Originators
in any other Transaction Document or in any other document delivered pursuant
hereto or thereto (other than in a Monthly Report) shall prove to have been
incorrect in any material respect when made or deemed made; provided that no
such event shall constitute a Termination Event unless such event is unremedied
for a period of ten (10) Business Days after the earlier to occur of (i) written
notice thereof shall have been given by the Buyer (or its assigns) to the
applicable Originator or (ii) an Authorized Officer of such Originator shall
have actual knowledge thereof or should have had knowledge thereof if such
Authorized Officer had exercised reasonable care in the performance of his or
her duties; provided, further that no grace period shall apply to
Sections 2.1(f), 2.1(i), 2.1(j), 2.1(n), 2.1(p) and 2.1(u); and provided,
further no such event shall constitute a Termination Event if the Seller have
timely paid to the Administrator the Purchase Price Credit required to be paid
as a result of such event in accordance with Section 1.4.

(c) Failure of any Originator to pay any Indebtedness when due in excess of
$10,000,000 (after giving effect to any applicable grace periods); or the
default by any Originator in the performance of any term, provision or condition
contained in any agreement under which any such Indebtedness was created or is
governed, the effect of which is to cause, or to permit the holder or holders of
such Indebtedness to cause, such Indebtedness to become due prior to its stated
maturity; or any such Indebtedness of any Originator 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 any Originator or any of
its Subsidiaries.

(e) A Change of Control shall occur.

(f) One or more final judgments of a court of competent jurisdiction for the
payment of money in an amount in excess of $10,000,000, individually or in the
aggregate, shall be entered against any Originator or any of its Subsidiaries 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 sixty (60) consecutive days without a stay of execution.

(g) This Agreement shall terminate in whole or in part (except in accordance
with its terms), or shall cease to be effective or to be the legally valid,
binding and enforceable obligation of any Originator, or any Originator shall
directly or indirectly contest in any manner such effectiveness, validity,
binding nature or enforceability, or Buyer (or its assigns) shall cease to have
a valid and perfected first priority security interest in the Receivables, its
Collections, “Supporting Obligations” (as defined in Article 9 of the UCC in
effect in each relevant jurisdiction), each Originator’s right, title and
interest in, to and under each of the Transaction Documents to which it is a
party, returned goods the sale of which gave rise to any Receivable, security
interests in favor of any Originator that secure payment of such Receivable and
all other items of Related Security in which an interest therein may be
perfected by the filing of financing statements under Article 9 of the UCC and
proceeds of the foregoing, or any Person shall contest the Buyer’s perfected
first priority ownership interest in that portion of the

 

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Related Security in which perfection cannot be accomplished under Article 9 of
the relevant UCC, or the Buyer (or its assigns) shall incur any loss resulting
from any Originator’s failure to perfect Buyer’s ownership interest in that
portion of the Related Security in which perfection cannot be accomplished under
Article 9 of the relevant UCC.

(h) The Internal Revenue Service shall file notice of a lien pursuant to
Section 6323 of the Tax Code with regard to any of the Receivables or the
Related Security or the PBGC shall file notice of a lien pursuant to
Section 4068 of ERISA with regard to any of the Receivables or the Related
Security and any such lien shall not have been released within the earlier to
occur of (i) seven (7) days after the date of such filing and (ii) the day on
which the Buyer (or any of its assigns) becomes aware of such filing.

(i) Any Plan of any Originator or any of its ERISA Affiliates:

(i) shall fail to be funded in accordance with the minimum funding standard
required by applicable law, the terms of such Plan, Section 412 of the Tax Code
or Section 302 of ERISA for any plan year or a waiver of such standard is sought
or granted with respect to such Plan under applicable law, the terms of such
Plan or Section 412 of the Tax Code or Section 303 of ERISA; or

(ii) is being, or has been, terminated or the subject of termination proceedings
under applicable law or the terms of such Plan; or

(iii) shall require any Originator or any of its ERISA Affiliates to provide
security under applicable law, the terms of such Plan, Section 401 or 412 of the
Tax Code or Section 306 or 307 of ERISA; or

(iv) results in a liability to any Originator or any of its ERISA Affiliates
under applicable law, the terms of such Plan, or Title IV ERISA,

and there shall result from any such failure, waiver, termination or other event
a liability to the PBGC or a Plan that would have a Material Adverse Effect.

(j) Any other event shall occur which has, or could be reasonably expected to
have a Material Adverse Effect.

Section 5.2 Remedies.

Upon the occurrence and during the continuation of a Termination Event, Buyer
may take any of the following actions: (a) 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 each Originator; provided, however, that upon the occurrence of a Termination
Event described in Section 5.1(d), or of an actual or deemed entry of an order
for relief with respect to any Originator under the Federal Bankruptcy Code, the
Termination Date shall automatically occur, without demand, protest or any
notice of any kind, all of which are hereby expressly waived by each Originator
and (b) to the fullest extent permitted by applicable law, declare that the
Default Fee shall accrue with respect to any amounts then due and owing by each
Originator to Buyer. The aforementioned rights and remedies shall be without
limitation and shall be in addition to all other rights and remedies of

 

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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 Originators.

Without limiting any other rights that Buyer may have hereunder or under
applicable law, each Originator 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, costs, expenses and for all other amounts payable, including
reasonable attorneys’ fees and disbursements (all of the foregoing being
collectively referred to as “Indemnified Amounts”) awarded against or incurred
by any of them arising out of or as a result of this Agreement or the
acquisition, either directly or indirectly, by Buyer of an interest in the
Receivables, excluding, however:

(a) Indemnified Amounts to the extent a final judgment of a court of competent
jurisdiction holds that such Indemnified Amounts resulted from gross negligence
or willful misconduct on the part of the Indemnified Party seeking
indemnification;

(b) Indemnified Amounts to the extent the same includes losses in respect of
Receivables that are uncollectible on account of the insolvency, bankruptcy or
lack of creditworthiness of the related Obligor; or

(c) taxes imposed by the United States, the Indemnified Party’s jurisdiction of
organization (or in the case of an individual, primary resident) or any other
jurisdiction in which such Indemnified Party has established a taxable nexus
other than in connection with the transaction contemplated hereby, on or
measured by the overall net income of such Indemnified Party to the extent that
the computation of such taxes is consistent with the characterization for income
tax purposes of the acquisition by Market Street or the LC Bank of Receivables
under the Purchase Agreement as a loan or loans by Market Street or the LC Bank
to Buyer secured by, among other things, the Receivables, the Related Security
and the Collections;

provided, however, that nothing contained in this sentence shall limit the
liability of any Originator or limit the recourse of Buyer to any Originator for
amounts otherwise specifically provided to be paid by such Originator under the
terms of this Agreement. Without limiting the generality of the foregoing
indemnification, but subject in each case to clauses (a), (b) and (c) above, an
Originator shall indemnify Buyer for Indemnified Amounts relating to or
resulting from:

(i) any representation or warranty made by such Originator (or any officers of
such Originator) under or in connection with any Purchase Report, this
Agreement, any other Transaction Document or any other information or report
delivered by such Originator 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 such Originator, 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 such Originator to keep or
perform any of its obligations, express or implied, with respect to any
Contract;

(iii) any failure of such Originator 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
such Originator 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) 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 such Originator’s right, title and interest in the
Related Security associated with the Receivables, in each case, free and clear
of any Adverse Claim except for Adverse Claims in favor of the Buyer and its
assigns;

(xi) the failure to have filed, or any delay in filing, financing statements or
other similar instruments or documents under the UCC of any applicable

 

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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;

(xii) any action or omission by such Originator which reduces or impairs the
rights of Buyer (or its assigns) with respect to any Receivable or the value of
any such Receivable;

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

(xiv) 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.

Section 6.2 Other Costs and Expenses.

Each Originator shall pay to Buyer promptly on demand all reasonable costs and
out-of-pocket expenses in connection with the preparation, execution, delivery
and administration of this Agreement, the transactions contemplated hereby and
the other documents to be delivered hereunder. Each Originator shall pay to
Buyer promptly on demand any and all reasonable 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 each Originator and Buyer and, to the extent
required under the Purchase Agreement, the Administrator and the Liquidity Banks
or the Required Liquidity Banks. Any material amendment, supplement,
modification of waiver will required satisfaction of the Rating Agency
Condition.

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

 

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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, ten
(10) 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) Each Originator 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 interest in the Receivables, or to enable Buyer (or its
assigns) to exercise and enforce their rights and remedies hereunder; provided,
however, that unless and until an Amortization Event or an Unmatured
Amortization Event has occurred, none of the Originators shall be required to
take any actions to establish, maintain or perfect the Buyer’s ownership
interest in the Related Security other than the filing of financing statements
under the UCC of all appropriate jurisdictions. During the occurrence and
continuance of an Unmatured Amortization or an Amortization Event, Buyer (or its
assigns) may, at the related Originator’s sole cost and expense, direct such
Originator to notify the Obligors of Receivables of the ownership interests of
Buyer under this Agreement. During the occurrence and continuance of an
Unmatured Amortization or an Amortization Event, Buyer (or its assigns) may
direct any Originator (and if any Originator fails to do so) Buyer (or its
assigns) may direct that payments of all amounts due or that become due under
any or all Receivables be made directly to an account specified by the Buyer or
its designee which may be an account of the Buyer (or its assigns).

(b) If any Originator fails to perform any of its obligations hereunder, Buyer
(and Administrator, as Buyer’s assignee) may (but shall not be required to) upon
notice to such Originator perform, or cause performance of, such obligations,
and Buyer’s (or such assigns’) costs and expenses incurred in connection
therewith shall be payable by such Originator as provided in Section 6.2. Each
Originator irrevocably authorizes Buyer (and Administrator, as Buyer’s assignee)
at any time and from time to time in the sole discretion of Buyer (or such
assignee), and appoints Buyer (and such assignee) as its attorney(ies)-in-fact,
to act on behalf of such Originator (i) to execute (if required) on behalf of
such Originator as debtor or seller and to file financing statements necessary
or desirable in Buyer’s (or such assignee’s) sole discretion to perfect and to
maintain the perfection and priority of the ownership 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 Administrator, as Buyer’s assignee) in its sole discretion
deems necessary or desirable to perfect and to maintain the perfection and
priority of Buyer’s ownership interest in the Receivables. This appointment is
coupled with an interest and is irrevocable. (A) Each Originator hereby
authorizes Buyer (and Administrator, as Buyer’s assignee) 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 further authorization
of such Originator, in such form and in

 

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such offices as Buyer (or such assignee) reasonably determines appropriate to
perfect or maintain the perfection of the ownership or security interests of
Buyer (and Administrator, as Buyer’s assignee) hereunder, (B) each Originator
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 Administrator (as Buyer’s assignee), consenting to the
form and substance of such filing or recording document, and (C) each Originator
approves, authorizes and ratifies any filings or recordings made by or on behalf
of the Administrator (as Buyer’s assignee) in connection with the perfection of
the ownership or security interests in favor of Buyer or the Administrator (as
Buyer’s assignee).

Section 7.4 Confidentiality.

(a) Each Originator shall maintain and shall cause each of its employees and
officers to maintain the confidentiality of the Fee Letter and any confidential
or proprietary information with respect to Market Street and the LC Bank and
Market Street’s and the LC Bank’s business obtained by it or them in connection
with the structuring, negotiating and execution of the transactions contemplated
herein, except that such Originator and its officers and employees may disclose
such information to such Originator’s directors, external accountants and
attorneys and in accordance with any applicable 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).

(b) Anything herein to the contrary notwithstanding, each Originator hereby
consents to the disclosure of any nonpublic information with respect to it
(i) to Buyer, the Administrator, PNC, the LC Bank or Market Street by each
other, (ii) by Buyer, the Administrator, PNC, the LC Bank or Market Street to
any prospective or actual assignee or participant of any of them and (iii) by
the Administrator to any rating agency, Commercial Paper dealer or provider of a
surety, guaranty or credit or liquidity enhancement to Market Street or any
entity organized for the purpose of purchasing, or making loans secured by,
financial assets for which PNC or one of its affiliates acts as the
administrator and/or agent 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, Market
Street, PNC, the LC Bank and the Administrator may disclose any such nonpublic
information in accordance with 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 any confidential or proprietary information with
respect to each Originator, 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 Administrator, Market
Street, the LC Bank and PNC, (ii) to any prospective or actual assignee or
participant who executes a confidentiality agreement for the benefit of any

 

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Originator 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 Market Street,
(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; provided each such Person is
informed of the confidential nature of such information.

Section 7.5 Bankruptcy Petition.

(a) Each of the Originators and Buyer 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 Market Street, it will not institute against,
or join any other Person in instituting against, Market Street 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) Each of the Originators covenants and agrees that, prior to the date that is
one year and one day after the payment in full of all outstanding obligations of
Buyer under the Purchase 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 Market Street, the Administrator, the LC Bank or any Liquidity
Bank, no claim may be made by any Originator or any other Person against Market
Street, the Administrator, the LC Bank or any Liquidity Bank 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 each Originator 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 INTERNAL
LAWS (AND NOT THE LAW OF CONFLICTS OTHER THAN SECTION 5-1401 OF THE NEW YORK
GENERAL OBLIGATIONS LAW) OF THE STATE OF NEW YORK.

 

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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 ORIGINATOR PURSUANT TO THIS AGREEMENT AND EACH PARTY
HERETO 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 ANY ORIGINATOR IN THE COURTS OF ANY OTHER
JURISDICTION. ANY JUDICIAL PROCEEDING BY ANY ORIGINATOR 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 ANY ORIGINATOR 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 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 ANY ORIGINATOR 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 each
Originator, Buyer and their respective successors and permitted assigns
(including any trustee in bankruptcy). No Originator may 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 any Originator. Without limiting the foregoing, each Originator
acknowledges that Buyer, pursuant to the Purchase Agreement, may assign to the
Administrator, for the benefit of Market Street and the LC Bank and their
assigns, its rights, remedies, powers and privileges hereunder and that the
Administrator may further assign such rights, remedies, powers and privileges to
the extent permitted in the Purchase Agreement. Each Originator agrees that the
Administrator, as the assignee of Buyer, shall, subject to the terms of the
Purchase Agreement, have the right to enforce this Agreement and to exercise
directly all of Buyer’s rights and remedies under this

 

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Agreement (including, without limitation, the right to give or withhold any
consents or approvals of Buyer to be given or withheld hereunder) and each
Originator agrees to cooperate fully with the Administrator 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 any Originator 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.

(c) This Agreement amends and restates the Existing Agreement in its entirety,
effective as of the Closing Date, and is not intended to constitute a novation
of the obligations thereunder. Nothing contained herein shall terminate any
security interests or subordinations previously granted in favor of Three
Pillars Funding LLC (“TPF”) or SunTrust Robinson Humphrey, Inc. (f/k/a SunTrust
Capital Markets, “STRH”) in connection with the Existing Agreement and the
transactions contemplated thereby; such security interests and subordinations
are being assigned by TPF and STRH to Market Street and the Administrator, as
applicable; and such security interest and subordinations shall continue in full
force and effect in favor of Market Street, the LC Bank and the Administrator,
as applicable, from and after the Closing Date.

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 by facsimile or other means of electronic transmission shall be effective
as delivery of a manually executed counterpart of 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.

[remainder of page intentionally left blank]

 

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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.

 

ARCH CHEMICALS, INC. By:  

/s/    W. PAUL BUSH        

Name:   W. Paul Bush Title:   Treasurer Address: US Mail: 501 Merritt 7 P.O. Box
5204 Norwalk, CT 06856-5204 Hand Delivery: 501 Merritt 7 Norwalk, CT 06851
Attention: Corporate Secretary Telephone No.: (203) 229-2900 Facsimile No.:
(203) 229-2713

[additional signatures to follow]

 

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ARCH TREATMENT TECHNOLOGIES, INC. By:  

/s/    W. PAUL BUSH        

Name:   W. Paul Bush Title:   VP and Treasurer Address: US Mail: c/o Arch
Chemicals, Inc. 501 Merritt 7 P.O. Box 5204 Norwalk, CT 06856-5204 Hand
Delivery: c/o Arch Chemicals, Inc. 501 Merritt 7 Norwalk, CT 06851 Attention:
Corporate Secretary Telephone No.: (203) 229-2900 Facsimile No.: (203) 229-2713

[additional signatures to follow]

 

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ARCH WOOD PROTECTION, INC. By:  

/s/    W. PAUL BUSH        

Name:   W. Paul Bush Title:   Treasurer Address: US Mail: c/o Arch Chemicals,
Inc. 501 Merritt 7 P.O. Box 5204 Norwalk, CT 06856-5204 Hand Delivery: c/o Arch
Chemicals, Inc. 501 Merritt 7 Norwalk, CT 06851 Attention: Corporate Secretary
Telephone No.: (203) 229-2900 Facsimile No.: (203) 229-2713 ARCH PERSONAL CARE
PRODUCTS, L.P. By:   Arch PCI, Inc., as general partner By:  

/s/    W. PAUL BUSH        

Name:   W. Paul Bush Title:   Treasurer Address: US Mail: c/o Arch Chemicals,
Inc. 501 Merritt 7 P.O. Box 5204 Norwalk, CT 06856-5204 Hand Delivery: c/o Arch
Chemicals, Inc. 501 Merritt 7 Norwalk, CT 06851 Attention: Corporate Secretary
Telephone No.: (203) 229-2900 Facsimile No.: (203) 229-2713

[additional signatures to follow]

 

34

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ARCH CHEMICALS RECEIVABLES CORP. By:  

/s/    W. PAUL BUSH        

Name:   W. Paul Bush Title:   Treasurer Address: US Mail: c/o Arch Chemicals,
Inc. 501 Merritt 7 P.O. Box 5204 Norwalk, CT 06856-5204 Hand Delivery: c/o Arch
Chemicals, Inc. 501 Merritt 7 Norwalk, CT 06851 Attention: Corporate Secretary
Telephone No.: (203) 229-3576 Facsimile No.: (203) 229-3143

[end of signatures]

 

35

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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 Purchase Agreement (hereinafter defined).

Administrator: As defined in the Preliminary Statements to the Agreement.

Agreement: The Amended and Restated Receivables Sale Agreement, dated as of
October 6, 2009, between each Originator and Buyer, as the same may be amended,
restated or otherwise modified.

Buyer: As defined in the preamble to the Agreement.

Calculation Period: 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.

Credit and Collection Policy: Each Originator’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.

Default Fee: A per annum rate of interest equal to the sum of (a) (the Prime
Rate, plus (b) 2% per annum.

Discount Factor: A percentage calculated to provide Buyer with a reasonable
return on its investment in the Receivables after taking account of (a) 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 (b) the risk of nonpayment by the Obligors. Originator 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, shall apply only prospectively and shall not affect the Purchase Price
payment made prior to the Calculation Period during which Originator and Buyer
agree to make such change.

Initial Contributed Receivables: As defined in Section 1.1.

Initial Cutoff Date: As defined in Section 1.1.

Material Adverse Effect: A material adverse effect on (a) the financial
condition or operations of Arch Chemicals and its Subsidiaries taken as a whole,
(b) the ability of any Originator to perform its obligations under the Agreement
or any other Transaction Document, (c) the legality, validity or enforceability
of the Agreement or any other Transaction Document, (d) any

 

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Originator’s, Buyer’s, the Administrator’s, the LC Bank’s or Market Street’s
interest in the Receivables generally or in any significant portion of the
Receivables, the Related Security or Collections with respect thereto, or
(e) the collectability of the Receivables generally or of any material portion
of the Receivables.

Net Worth: As of the last Business Day of each Calculation Period preceding any
date of determination, the excess, if any, of (a) the sum of (i) the aggregate
Outstanding Balance of the Receivables at such time and (ii) the aggregate cash
and cash equivalents held, over (b) the sum of (i) the Aggregate Invested Amount
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) plus (iii) the LC Amount.

Organizational Documents: 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.

Original Balance: With respect to any Receivable coming into existence after the
Initial Cutoff Date, the Outstanding Balance of such Receivable on the date it
was created.

Originator: As defined in the preamble to the Agreement.

Purchase: The purchase pursuant to Section 1.2(a) of the Agreement by Buyer from
any Originator of the Receivables and the Related Security and Collections
related thereto, together with all related rights in connection therewith.

Purchase Agreement: The meaning set forth in the Preliminary Statements to the
Agreement.

Purchase Price: With respect to the Purchase, the aggregate price to be paid by
Buyer to any Originator 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 (a) the product of (i) the
Outstanding Balance of such Receivables on such date, multiplied by (ii) one
minus the Discount Factor in effect on such date, minus (b) 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: As defined in Section 1.4 of the Agreement.

Purchase Report: As defined in Section 1.2(b) of the Agreement.

Receivable: All indebtedness and other obligations owed by any Obligor in the
United States or Canada to any Originator (at the times it arises, and before
giving effect to any transfer or conveyance under the Agreement) or Buyer (after
giving effect to the transfers under the Agreement) or in which any Originator
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, arising in connection with the
sale of goods or the rendering of services by any Originator and further
includes, without limitation, the obligation to pay any Finance Charges with
respect thereto.

 

I-2

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Related Security: With respect to any Receivable:

(a) all of the related Originator’s interest in the inventory and goods
(including returned or repossessed inventory or goods), if any, the sale,
financing or lease of which by such Originator gave rise to such Receivable, and
all insurance contracts with respect thereto,

(b) 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,

(c) 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,

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

(e) all Records related to such Receivable,

(f) all of such Originator’s right, title and interest in each Lock-Box and each
Collection Account, and

(g) all proceeds of any of the foregoing;

provided, however, that “Related Security” shall not include any Restricted
Contract to the extent the assignment or transfer of, or the creation,
attachment, perfection or enforcement of a security interest in, such Restricted
Contract is not authorized by Section 9-406(d) of the UCC as in effect in each
relevant jurisdiction.

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

Required Capital Amount: As of any date of determination, an amount equal to the
greater of (a) 3% of the Purchase Limit under the Purchase Agreement, and
(b) the product of (i) 1.5 times the product of the Default Ratio times the Loss
Horizon Ratio, each as determined from the most recent Monthly Report received
from the Servicer under the Purchase 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 Purchase Agreement.

 

I-3

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Restricted Contract: Any Contract that contains an enforceable provision
affirmatively restricting the assignment of the related Originator’s rights
under such Contract to another Person where such provision does not include any
exception that could permit such an assignment to Buyer (other than obtaining
the consent of another Person (other than the Originator) if required by such
Contract) or the breach of which provision would result in the termination of
such Contract.

Subordinated Loan: As defined in Section 1.3(a) of the Agreement.

Subordinated Note: 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: The Internal Revenue Code of 1986, as the same may be amended from
time to time.

Termination Date: The earliest to occur of (a) the Facility Termination Date (as
defined in the Purchase Agreement), (b) the Business Day immediately prior to
the occurrence of a Termination Event set forth in Section 5.1(d), (c) the
Business Day specified in a written notice from Buyer to any Originator
following the occurrence of any other Termination Event, and (d) the date which
is 10 Business Days after Buyer’s receipt of written notice from the Originators
that they wish to terminate the facility evidenced by this Agreement.

Termination Event: As defined in Section 5.1 of the Agreement.

Unmatured Termination Event: 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. Unless otherwise specified, 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.

 

I-4

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Exhibit VI

Form of Subordinated Note

SUBORDINATED NOTE

            , 200  

1. Note. FOR VALUE RECEIVED, the undersigned, Arch Chemicals Receivables Corp.,
a Delaware corporation (“SPV”), hereby unconditionally promises to pay to the
order of [ORIGINATOR NAME], a(n)              ***[corporation] [limited
liability company] [partnership]*** (“Originator”), 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 (a) the Outstanding Balance of all Receivables sold under the “Sale
Agreement” referred to below has been reduced to zero and (b) Originator 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 Originator to SPV pursuant to and in accordance with the
terms of that certain Amended and Restated Receivables Sale Agreement dated as
of October 6, 2009 between Originator and certain of its affiliates, as sellers,
and SPV, as buyer (as amended, restated, supplemented or otherwise modified from
time to time, the “Sale Agreement”). Reference to Section 1.3 of the 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 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. Originator 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 evidence of the accuracy of the
information so entered; provided that neither the failure of Originator to make
any such entry or any error therein shall expand, limit or affect the
obligations of SPV hereunder.

 

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4. Subordination. Originator 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 SPV’s Net Worth would be less than the Required Capital Amount.
Originator hereby agrees that at any time during which the conditions set forth
in the proviso of the immediately preceding sentence shall not be satisfied,
Originator shall be subordinate in right of payment to the prior payment of any
indebtedness or obligation of SPV owing to the Administrator, the LC Bank or
Market Street under that certain Amended and Restated Receivables Purchase
Agreement dated as of October 6, 2009 (as amended, restated, supplemented or
otherwise modified from time to time, the “Purchase Agreement”) by and among
SPV, Arch Chemicals, Inc., as initial Servicer, Market Street Funding LLC, PNC
Bank, National Association as LC Bank (the “LC Bank”) and PNC Bank, National
Association, as agent and administrator for Market Street and its liquidity
providers and the LC Bank (in such capacity, the “Administrator”). The
subordination provisions contained herein are for the direct benefit of, and may
be enforced by, the Administrator, Market Street, the LC Bank and/or any of
their respective assignees (collectively, the “Senior Claimants”) under the
Purchase Agreement. Until the date on which the “Aggregate Invested Amount”
outstanding under the Purchase 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, Originator shall not institute
against SPV any proceeding of the type described in Section 5.1(d) of the Sale
Agreement unless and until the Collection Date has occurred. Should any payment,
distribution or security or proceeds thereof be received by Originator in
violation of this Section 4, Originator 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
Administrator 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 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 Invested Amount
and the Senior Claim (including “Yield” as defined and as accruing under the
Purchase Agreement after the commencement of any such proceeding, whether or not
any or all of such Yield is an allowable claim in any such proceeding) before
Originator 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 Administrator 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.

6. Amendments. This Subordinated Note shall not be amended or modified except in
accordance with Section 7.1 of the Sale Agreement. The terms of this
Subordinated Note may not be amended or otherwise modified without the prior
written consent of the Administrator for the benefit of Market Street and the LC
Bank and their assigns.

 

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7. GOVERNING LAW. THIS SUBORDINATED NOTE HAS BEEN MADE AND DELIVERED AT NEW
YORK, NEW YORK, AND SHALL BE INTERPRETED AND THE RIGHTS AND LIABILITIES OF THE
PARTIES HERETO DETERMINED IN ACCORDANCE WITH THE LAWS AND DECISIONS OF THE STATE
OF NEW YORK. 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.
Originator 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 Originator without the prior written consent
of the Administrator, and any such attempted transfer shall be void.

 

ARCH CHEMICALS RECEIVABLES CORP. By:  

 

Name:  

 

Title:  

 

 

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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)

                                                                                
                                                  

 

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Schedule A

DOCUMENTS TO BE DELIVERED TO BUYER

ON OR PRIOR TO THE PURCHASE

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

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

3. A certificate of each Originator’s [and, if applicable, its general
partner’s] Secretary or Assistant Secretary certifying:

(a) A copy of the Resolutions of its Board of Directors (or comparable body),
authorizing its execution, delivery and performance of the Amended and Restated
Receivables Sale Agreement and the other documents to be delivered by it
thereunder;

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

(c) Good Standing Certificates for such Person issued by the Secretaries of
State of its state of organization; and

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

4. Pre-filing state and federal tax lien, judgment lien searches from the
jurisdiction of organization and jurisdiction of its chief executive office and
UCC lien searches from the jurisdiction of organization dated within thirty
(30) days of the Closing Date against each Originator .

5. Assignments of UCC financing statements, in form suitable for filing under
the UCC 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
Amended and Restated Receivables Sale Agreement.

6. 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 any Originator, together with
authorization to file the same.

7. Executed notices of or consents to, as applicable, assignments of the
Collection Account Agreements for each Lock-Box and Collection Account.

 

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8. A favorable opinion of legal counsel for the Originators (and, if applicable,
its general partner) reasonably acceptable to the Administrator which addresses
the following matters and such other matters as the Administrator may reasonably
request:

(a) due authorization, execution, delivery, enforceability and other corporate
matters with respect to each of the Originators (and such general partner);

(b) the creation of a first priority perfected security interest in favor of the
Buyer (and the Administrator for the benefit of the Secured Parties as its
assignee) in (1) all of the Receivables and (2) all proceeds of any of the
foregoing;

(c) the existence of a “true sale” of the Receivables from Originators to the
Buyer under the Amended and Restated Receivables Sale Agreement;

(d) the inapplicability of the doctrine of substantive consolidation to Buyer
and any Originator or its affiliates or in connection with any bankruptcy
proceeding involving Buyer, any Originator or such affiliates.

9. A Certificate of each Originator’s chief financial officer or treasurer
certifying that, as of the closing date, no Termination Event or Unmatured
Termination Event exists and is continuing.

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

11. Executed Subordinated Note by Buyer in favor of each Originator.

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

 

2