RECEIVABLES SALE AGREEMENT

 

DATED AS OF NOVEMBER 15, 2001

 

among

 

LOUISIANA-PACIFIC CORPORATION

as Originator

 

LP WOOD POLYMERS, INC.

as Originator

 

and

 

LP RECEIVABLES CORPORATION

as Buyer

 

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TABLE OF CONTENTS

 

Article I Amounts and Terms of the Purchase

 

Section 1.1

Initial Contribution of Receivables.

 

Section 1.2

Purchase of Receivables.

 

Section 1.3

Payment for the Purchase.

 

Section 1.4

Purchase Price Credit Adjustments.

 

Section 1.5

Payments and Computations, Etc.

 

Section 1.6

Transfer of Records.

 

Section 1.7

Characterization.

Article II Representations and Warranties

 

Section 2.1

Representations and Warranties of Originators.

Article III Conditions of Purchase

 

Section 3.1

Conditions Precedent to Purchase.

 

Section 3.2

Conditions Precedent to Subsequent Payments.

Article IV Covenants

 

Section 4.1

Affirmative Covenants of Originators.

 

Section 4.2

Negative Covenants of Originators.

Article V Termination Events

 

Section 5.1

Termination Events.

 

Section 5.2

Remedies.

Article VI Indemnification

 

Section 6.1

Indemnities by Originators.

 

Section 6.2

Defense of Claims.

 

Section 6.3

Other Costs and Expenses.

Article VII Miscellaneous

 

Section 7.1

Waivers and Amendments.

 

Section 7.2

Notices.

 

Section 7.3

Protection of Ownership Interests of Buyer.

 

Section 7.4

Confidentiality.

 

Section 7.5

Bankruptcy Petition.

 

Section 7.6

Limitation of Liability.

 

Section 7.7

CHOICE OF LAW.

 

Section 7.8

CONSENT TO JURISDICTION.

 

Section 7.9

WAIVER OF JURY TRIAL.

 

Section 7.10

Integration; Binding Effect; Survival of Terms.

 

Section 7.11

Counterparts; Severability; Section References.

 

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Exhibits

 

Exhibit I                                  Definitions

 

Exhibit II                              Jurisdiction of Formation; Principal
Place of Business Chief Executive Office; 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

 

Exhibits VIII            Material Adverse Effect

 

Schedules

 

Schedule A               List of Documents to be Delivered to Buyer on or Prior
to Closing Date

 

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RECEIVABLES SALE AGREEMENT

 

THIS RECEIVABLES SALE AGREEMENT, dated as of November 15, 2001, is by and among
Louisiana-Pacific Corporation, a Delaware corporation (“Louisiana-Pacific”) and
LP Wood Polymers, Inc., an Oregon corporation (“LP Wood”) (each an “Originator”
and collectively, the “Originators”), and LP RECEIVABLES CORPORATION, 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 Credit Agreement).

 

PRELIMINARY STATEMENTS

 

The Originators now own, and from time to time hereafter will own, Receivables. 
The Originators wish to sell and assign to Buyer, and Buyer wishes to purchase
from each 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.

 

The Originators and Buyer intend the transactions contemplated hereby to be true
sales and absolute assignments of the Receivables from each Originator to Buyer,
providing Buyer with the full benefits of ownership of the Receivables, and
neither the Originators nor Buyer intend these transactions to be, or for any
purpose to be characterized as, loans from Buyer to the Originators.

 

Following the acquisition of Receivables from the Originators, Buyer may request
loans secured by an interest therein and in the associated Related Security and
Collections pursuant to that certain Credit and Security Agreement dated as of
November 15, 2001 (as the same may from time to time hereafter be amended,
supplemented, restated or otherwise modified, the “Credit Agreement”) among
Buyer, Louisiana-Pacific Corporation, as initial Master Servicer, Blue Ridge
Asset Funding Corporation (“Blue Ridge”), the committed banks named therein and
Wachovia Bank, N.A. or any successor administrative agent appointed pursuant to
the terms of the Credit Agreement, as administrative agent (in such capacity,
the “Administrative Agent”).

 

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 the date hereof, Louisiana-Pacific hereby contributes, assigns, transfers,
sets-over and otherwise conveys to Buyer, and Buyer does hereby accept from
Louisiana-Pacific, Receivables originated by Louisiana-Pacific and existing as
of the close of business on the Business Day

 

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immediately prior to the date hereof (the “Initial Cutoff Date”) having an
aggregate Outstanding Balance of $3,750,000 (the “Initial Contributed
Receivables”), together with all Related Security relating thereto and all
Collections thereof.

 

Section 1.2                Purchase of Receivables.

 

(a)                                                           Effective on the
date hereof, in consideration for the Purchase Price and upon the terms and
subject to the conditions set forth herein, 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 such 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 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 Originator’s right, title and interest in and to all
Receivables existing as of the Initial Cut-Off Date (other than the Initial
Contributed Receivables) 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 each Monthly
Reporting Date, each Originator shall (or shall require the Master Servicer to)
deliver to Buyer a report in substantially the form of Exhibit VII (each such
report being herein called a “Purchase Report”) with respect to the Receivables
sold by such Originator to Buyer during the Settlement Period then most recently
ended.  In addition to, and not in limitation of, the foregoing, in connection
with the payment of the Purchase Price for any Receivables purchased hereunder,
Buyer may request that the related Originator deliver, and such 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 hereunder
shall constitute a sale, which sale is absolute and irrevocable and provides
Buyer with the full benefits of ownership of the Receivables.  Except for the
Purchase Price Credits owed pursuant to Section 1.4, the sale of Receivables
hereunder is made without recourse to 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 such Originator.  In view of
the intention of the parties hereto that the Purchase of Receivables made
hereunder shall constitute a sale of such Receivables rather than loans secured
thereby, each Originator agrees that it will, on or prior to the date hereof and
in accordance with Section 4.1(e)(ii), mark its master data processing records
relating to the Receivables with a legend acceptable to Buyer and to the
Administrative Agent (as Buyer’s assignee), evidencing that Buyer has purchased
such Receivables as provided in this Agreement and to note in its financial
statements that its

 

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Receivables have been sold to Buyer.  Upon the request of Buyer or the
Administrative Agent (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 Administrative Agent (as Buyer’s assignee)
may reasonably request.

 

Section 1.3                Payment for the Purchase.

 

(a)                                  The Purchase Price for the Purchase from
each Originator of its Receivables in existence as of the close of business on
the Initial Cutoff Date (other than the Initial Contributed Receivables) shall
be payable in full by Buyer to such Originator on the date hereof, and shall be
paid to the Originators in the following manner:

 

(i)                                     first, to LP Wood with respect to
Receivables sold by LP Wood, by delivery of immediately available funds to the
extent of funds made available to Buyer in connection with Advances made to
Buyer under the Credit Agreement,

 

(ii)                                  second, to LP Wood, the balance of the
Purchase Price with respect to the Receivables sold by LP Wood, by delivery of
the proceeds of a subordinated revolving loan from LP Wood to Buyer (a
“Subordinated Loan”), evidenced by an entry by the Originator Representative on
the Subordinated Note,  in an amount not to exceed the least of (A) the
remaining unpaid portion of such Purchase Price, (B) the maximum Subordinated
Loan (aggregated with all Subordinated Loans then outstanding to all
Originators) that could be borrowed without rendering Buyer’s Net Worth less
than the Required Capital Amount, and (C) fifteen percent (15%) of such Purchase
Price.  Louisiana-Pacific, in its capacity as Originator Representative, is
hereby authorized by Buyer to endorse on the schedule attached to the
Subordinated Note an appropriate notation evidencing the date and amount of each
advance by LP Wood 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,

 

(iii)                               third, to Louisiana-Pacific,  with respect
to Receivables sold by Louisiana-Pacific, by delivery of immediately available
funds to the extent of funds made available to Buyer in connection with Advances
made to Buyer under the Credit Agreement and not otherwise used for the payment
of the Purchase Price with respect to the Receivables of LP Wood in clause (i)
above, and

 

(iv)                              fourth, to Louisiana-Pacific, the balance of
the Purchase Price with respect to the Receivables sold by Louisiana-Pacific, by
delivery of the proceeds of a Subordinated Loan from Louisiana-Pacific to Buyer,
evidenced by an entry by the Originator Representative on the Subordinated Note;
provided that the making of any such Subordinated Loan shall be subject to the
provisions set forth in Section 1.3(a)(ii).

 

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The Purchase Price for each Receivable coming into existence after the Initial
Cutoff Date shall be due and owing in full by Buyer to the applicable 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 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, not later than the Purchase

Settlement Date, Buyer shall pay the Purchase Price therefor in accordance with
Section 1.3(d) and in the following manner,

 

(i)                                     first, to LP Wood with respect to
Receivables sold by LP Wood, by delivery of immediately available funds to the
extent of funds made available to Buyer in connection with Advances made to
Buyer under the Credit Agreement or other  cash on hand,

 

(ii)                                  second, to LP Wood, the balance of the
Purchase Price with respect to the Receivables sold by LP Wood, by delivery to
LP Wood of the proceeds of a Subordinated Loan, provided that the making of any
such Subordinated Loan shall be subject to the provisions set forth in Section
1.3(a)(ii),

 

(iii)                               third, to Louisiana-Pacific with respect to
Receivables sold by Louisiana-Pacific, by delivery of immediately available
funds to the extent of funds made available to Buyer in connection with Advances
made to Buyer under the Credit Agreement or other cash on hand and not otherwise
used for the payment of the Purchase Price with respect to the Receivables of LP
Wood in clause (i) above,

 

(iv)                              fourth, to Louisiana-Pacific with respect to
Receivables sold by Louisiana-Pacific, to the extent not paid pursuant to clause
(iii) above, by delivery to Louisiana-Pacific of the proceeds of a Subordinated
Loan, provided that the making of any such Subordinated Loan shall be subject to
the provisions set forth in Section 1.3(a)(ii); and

 

(v)                                 fifth, to the extent the Purchase Price of
Receivables transferred by Louisiana-Pacific has not been paid in full, unless
an 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) and Section
1.3(a)(iv), each Originator irrevocably agrees to advance each Subordinated Loan
requested by Buyer on or prior to the Termination Date.  The Subordinated Loans
shall be evidenced by, and shall be payable in accordance with the terms and
provisions of the Subordinated Note and shall be payable solely from funds which
Buyer is not required under the Credit Agreement to set aside for the benefit
of, or otherwise pay over to, the Secured Parties.

 

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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 Section
1.3(b)(v).

 

(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 applicable Originator on the date such
Receivable came into existence, settlement of the Purchase Price between Buyer
and such Originator shall be effected on Purchase Settlement Dates with respect
to all Receivables coming into existence during the related 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 Purchase Settlement Dates, increases or
decreases in the amount owing under the Subordinated Note made pursuant to this
Section 1.3 for interest calculation purposes only and any contribution of
capital by any Originator to Buyer made pursuant to Section 1.3(b)(v) shall be
deemed to have occurred and shall be effective as of the last Business Day of
the related Calculation Period.

 

Section 1.4                                   Purchase Price Credit Adjustments.

 

If on any day:

 

(a)                                  the Outstanding Balance of a Receivable
sold to Buyer is:

 

(i)                                     reduced as a result of any defective or
rejected goods or services, any cash discount or any other adjustment by any
Originator or any Affiliate thereof, or as a result of any tariff or other
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 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 or warranties of
any Originator set forth in Section 2.1(i), Section 2.1(j), Section 2.1(k),
Section 2.1(r), Section 2.1(s), Section 2.1(t) or Section 2.1(u) were not true
when made with respect to any Receivable,

 

then, in such event, Buyer shall be entitled to a credit (each, a “Purchase
Price Credit”), without duplication, against the Purchase Price otherwise
payable to the applicable Originator hereunder equal, in the case of clause (a)
above, to the amount of such reductions relating to such Receivable, and, in the
case of clause (b) above, to the Outstanding Balance of such Receivable

 

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 (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 such 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 the 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 applicable 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
hereunder, without the need for any further documentation in connection with the
Purchase.  In connection with such transfer, each Originator hereby grants to
each of Buyer, the Administrative Agent and the Master 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, each Originator hereby agrees that upon the 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.

 

(b)                                 Each Originator (i) shall take such action
requested by Buyer and/or the Administrative Agent (as Buyer’s assignee), from
time to time hereafter, that may be necessary or appropriate to ensure that
Buyer and its assigns under the Credit Agreement have an enforceable ownership
interest in the Records relating to the Receivables purchased from such
Originator hereunder, and (ii) shall use its reasonable efforts to ensure that
Buyer, the Administrative Agent and the Master Servicer each has an enforceable
right (whether by license

 

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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 0, any sale or
contribution by any Originator to Buyer of Receivables hereunder shall be
characterized as a secured loan and not a sale or such sale shall for any reason
be ineffective or unenforceable, then this Agreement shall be deemed to
constitute a security agreement under the UCC and other applicable law.  For
this purpose and without being in derogation of the parties’ intention that the
sale of Receivables hereunder shall constitute a true sale thereof, each
Originator hereby grants to Buyer a duly perfected security interest in all of
such Originator’s right, title and interest 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, whether
now owned or hereafter acquired, now existing or hereafter arising and wherever
located, including, without limitation, any of the foregoing constituting
accounts, deposit accounts, chattel paper, electronic chattel paper,
instruments, general intangibles, payment intangibles, 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 each
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.

 

Article II

 

Representations and Warranties

 

Section 2.1                                   Representations and Warranties of
Originators.

 

Each Originator hereby represents and warrants to Buyer as to itself, as of the
date hereof, as of the date of each Purchase and as of each date that any
Receivable of such Originator comes into existence that:

 

(a)           Such Originator’s jurisdiction of formation is correctly set forth
in Exhibit II to this Agreement.  Such Originator is duly organized under the
laws of such jurisdiction 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 state of organization.  Such Originator is
duly qualified to do business and is in good standing as a foreign entity, and
has and holds all organizational power and all governmental licenses,
authorizations, comments and approvals required to carry on its business in each
jurisdiction in which its business is conducted except where the failure to do
so qualify or so hold could not reasonably be expected to have a Material
Adverse Effect.

 

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(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, 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, violation,
creation or imposition could not reasonably be expected to have a Material
Adverse Effect; notwithstanding the foregoing, neither the execution and
delivery by such Originator of each Transaction Document to which it is a party
nor the performance of its obligations thereunder result in the creation or the
imposition of any Adverse Claim on any portion or all of the Collateral; 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 or
affecting such Originator, 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, except where such default could not
reasonably be expected to have a Material Adverse Effect.

 

(f)            Binding Effect.  This Agreement and each other Transaction
Document to which any 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 heretofore furnished by
such Originator or any of its Affiliates to Buyer (or its assigns) for purposes
of or in connection with

 

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this Agreement, any of the other Transaction Documents or any transaction
contemplated hereby or thereby is, and all such 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 as of the date such information is
stated or certified and does not and will not contain any untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statements contained therein, in the light of the circumstances under which they
were made, not misleading.

 

(h)           Use of Proceeds.  No portion of any Purchase Price payment
hereunder will be used (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.

 

(i)            Good Title.  Immediately prior to the Purchase hereunder and upon
the creation of each Receivable coming into existence after the Initial Cut-Off
Date, such Originator (i) is the legal and beneficial owner of the Receivables
sold or contributed by it hereunder and (ii) is the legal and beneficial owner
of the Related Security with respect thereto or possesses a valid and perfected
security interest therein, in each case, free and clear of any Adverse Claim,
except as created by the Transaction Documents or the Permitted Adverse Claim. 
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
sold or contributed by it hereunder, its Collections and the Related Security.

 

(j)            Perfection.  This Agreement, together with the filing of the
financing statements contemplated hereby, is effective to transfer to Buyer (and
Buyer shall acquire from 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 and the Permitted Adverse Claim.  There
have been duly filed all financing statements or other similar instruments or
documents necessary under the UCC (or any comparable law) of all appropriate
jurisdictions to perfect Buyer’s ownership interest in the Receivables, the
Related Security and the Collections.  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 jurisdiction of
formation, principal places of business and chief executive office of such
Originator and the offices where it keeps all of its Records are located at the
address(es) listed on Exhibit II or such other locations of which Buyer has been
notified in accordance with Section 4.2(a) in jurisdictions where all action
required by Section 4.2(a) has been taken and completed.  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
Section 4.1(i) have at all times been satisfied and duly performed.  The names
and addresses of all Collection Banks, together with the account numbers of the
Collection Accounts 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.  Each Originator  represents and warrants
that except as described in Exhibit VIII as delivered on the Closing Date or as
amended thereafter with the prior written consent of the Administrative Agent
(which consent may be withheld in its sole discretion), since June 30, 2001 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 Originator to have been
organized.  Except as described in Exhibit II attached hereto, 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.

 

(o)           Ownership of Buyer.  Louisiana-Pacific 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, except to the extent any
such failure to comply could have a Material Adverse Effect, and has not made
any change to such Credit and Collection Policy, except such 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 Originators.  With respect to each Receivable
transferred to Buyer hereunder, the Purchase Price received by such Originator
constitutes reasonably equivalent value in consideration therefor.  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 on the date of such Purchase Report was an
Eligible Receivable on the last day of the period to which such Purchase Report
relates.

 

(v)           Accounting.  The manner in which such Originator accounts for the
transactions contemplated by this Agreement does not adversely affect the status
of the transfers of Receivables, Related Security and all proceeds thereof to
Buyer pursuant to this Agreement as true sales for bankruptcy purposes.

 

Article III

 

Conditions of Purchase

 

Section 3.1            Conditions Precedent to Purchase.

 

The initial Purchase 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 effectiveness of
the Credit Agreement shall have been satisfied or waived in accordance with the
terms thereof.

 

Section 3.2            Conditions Precedent to Subsequent Payments.

 

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

 

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(i)                                     the representations and warranties set
forth in 0 are true and correct on and as of the date such Receivable came into
existence as though made on and as of such date; and

 

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

 

Notwithstanding the foregoing conditions precedent, upon payment of the Purchase
Price for any Receivable (whether by payment of cash, through an increase in the
amounts outstanding under the Subordinated Note, by offset of amounts owed to
Buyer and/or by offset of capital contributions), title to such Receivable and
the Related Security and Collections with respect thereto shall vest in Buyer,
whether or not the conditions precedent to Buyer’s obligation to pay for such
Receivable were in fact satisfied.  The failure of 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 the applicable 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 hereby covenants, as to itself, 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 respective fiscal years, audited, unqualified financial
statements (which shall include balance sheets, statements of income and
retained earnings and a statement of cash flows) for such Originator for such
fiscal year certified in a manner acceptable to Buyer (or its assigns) by
independent public accountants reasonably acceptable to Buyer (or its assigns).

 

(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 such Originator as at the close of each such
period and statements of income and retained earnings and a statement of cash
flows for such Originator for the period from the beginning of such fiscal year
to the end of such quarter, all certified by its chief financial officer.

 

(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.

 

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(iv)                              Shareholders Statements and Reports.  Promptly
upon the furnishing thereof to the shareholders of such Originator, copies of
all financial statements, reports and proxy statements so furnished; provided,
however, that to the extent that copies of any such financial statements,
reports or proxy statements are publicly available on EDGAR, the requirements of
this clause (iv) shall be satisfied.

 

(v)                                 S.E.C. Filings.  Promptly upon the filing
thereof, 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; provided, however, that to the
extent copies of such registration statements and annual, quarterly, monthly or
other regular reports are publicly available on EDGAR, the requirements of this
clause (v) shall be satisfied.

 

(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 Administrative Agent or Blue Ridge, copies of
the same.

 

(vii)                           Change in Credit and Collection Policy.  At
least seven (7) days prior to the effectiveness of any change in or amendment to
the Credit and Collection Policy, a copy of the Credit and Collection Policy
then in effect and a notice (A) indicating such proposed change or amendment,
and (B) if such proposed change or amendment would be reasonably likely to
adversely affect the collectibility of the Receivables or decrease the credit
quality of any newly created Receivables, requesting Buyer’s (and the
Administrative Agent’s, as Buyer’s assignee) consent thereto.

 

(viii)                        Other Information.  Promptly, from time to time,
such other information, documents, records or reports relating to the
Receivables or the condition or operations, financial or otherwise, 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.

 

(b)           Notices.  Each Originator will notify Buyer (or its assigns), as
to itself,  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 aggregate amount of all judgments and decrees then outstanding against such
Originator and its Subsidiaries exceeds $25,000,000 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 assumed responsibility in writing, and
(2) the amount for which such Originator or any such

 

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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 or an event of default  under any Material Indebtedness
or an event of default under any other financing arrangement pursuant to which
such Originator is a debtor or an obligor.

 

(v)                                 ERISA Events.  The occurrence of any ERISA
Event.

 

(vi)                              Downgrade of Originators.  Any downgrade in
the rating of any Indebtedness of such Originator by S&P or by Moody’s, setting
forth the Indebtedness affected and the nature of such change.

 

(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.

 

(d)           Audits.  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.  Such 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 possession or under the control
of such Originator relating to the Receivables and the Related Security,
including, without limitation, the related Contracts, 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
any Originator’s performance under any of the Transaction Documents or any such
Originator’s performance under the Contracts and, in each case, with any of the
officers or employees of such Originator having knowledge of such matters (each
of the foregoing examinations and visits a “Review”); provided, however, that so
long as no Amortization Event has occurred, (A) the Originators shall only be
responsible for the cost and expenses of a total of one (1) Review in any one
calendar year hereunder and under Section 7.1(d) of the Credit Agreement, and
(B) Buyer will not request more than a total of four (4) Reviews in any one
calendar year hereunder and under Section 7.1(d) of the Credit Agreement;
provided further that satisfaction of the audit requirements of Section 7.1(d)
of the Credit Agreement shall satisfy the requirements of this Section 4.1(d).

 

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(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 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 (A) on or prior to
the date hereof, mark its master data processing records and other books and
records relating to the Receivables with a legend, acceptable to Buyer (or its
assigns), describing Buyer’s ownership interests in the Receivables and further
describing the interest therein of the Administrative Agent (on behalf of the
Secured Parties) under the Credit Agreement and (B) upon the request of Buyer
(or its assigns) following the occurrence of an Amortization Event, deliver to
Buyer (or its assigns) all Contracts (including, without limitation, all
multiple originals of any such Contract) relating to the Receivables.

 

(f)            Compliance with Contracts and Credit and Collection Policy.  Such
Originator will timely and fully (i) perform and comply with all provisions,
covenants and other promises required to be observed by it under the Contracts
related to the Receivables, and (ii) comply in all material respects with the
Credit and Collection Policy in regard to each Receivable and the related
Contract, except to the extent any such failure to comply could have a Material
Adverse Effect.

 

(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 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 than Adverse Claims in favor of Buyer
(and its assigns) (including, without limitation, promptly (but in no event
later than December 15, 2001) obtaining a release with respect to the Permitted
Adverse Claim, 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).

 

(h)           Reliance.  Such Originator acknowledges that the Administrative
Agent, the Lender and the Committed Banks are entering into the transactions
contemplated by the Credit 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

 

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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 at all times comply, and 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
Credit Agreement, including without limitation, Section 7.1(i)(xviii) thereof
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 § 1.1552-1.

 

(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 Credit 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 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 hereby covenants, as to itself, that:

 

(a)           Name Change, Offices and Records.  Such  Originator will not
change its (i) jurisdiction of formation, (ii) name, (iii) identity or structure
(within the meaning of Article 9 of any applicable enactment of the UCC) or
relocate its chief executive office at any time while the location of its chief
executive office is relevant to perfection of Buyer’s interest in the

 

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Receivables or the associated Related Security and Collections, or any office
where Records are kept unless it shall have:  (A) given Buyer (or its assigns)
at least forty-five (45) 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.  Without the prior
written consents of the Buyer and the Administrative Agent, 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. 
Without the prior written consents of the Buyer and the Administrative Agent,
such Originator will not make any change to the Credit and Collection Policy
that could adversely affect the collectibility of the Receivables or decrease
the credit quality of any newly created Receivables.  Except as otherwise
permitted in its capacity as Subservicer pursuant to the Credit Agreement, such
Originator will not extend, amend or otherwise modify the terms of any
Receivable or any Contract related thereto other than in accordance with the
Credit and Collection Policy.

 

(d)           Sales, Liens.  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 other than the Permitted
Adverse Claim, upon (including, without limitation, the filing of any financing
statement) or with respect to, any Receivable, Related Security or Collections,
or upon or with respect to any Contract under which any Receivable arises, or
any Lock-Box or Collection Account, or assign any right to receive income with
respect thereto (other than, in each case, the creation of the interests therein
in favor of Buyer provided for herein), and 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
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 the proceeds of its inventory constituting Receivables or
Related Security.  If such Originator creates or suffers to exist any lien or
encumbrance on any of its inventory, the Originator shall send each such
agreement to the Administrative Agent prior to execution of any such agreement
to enable the Administrative Agent to review any such security agreements, any
financing statements and any other documents or instruments in connection with
the creation of such lien or encumbrance to determine in its sole discretion
that such lien or encumbrance does not relate to (i) any proceeds of any of such
Originator’s inventory constituting Receivables and Related Security and (ii)
any of the Collateral.  In the event that the Administrative Agent determines
any such agreement, financing statement or other document or instrument relates
to any portion or all of the

 

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Receivables, the Related Security or the Collateral, the Originator shall not
execute such security agreement, financing statement or other document or
instrument.

 

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

 

Article V

 

Termination Events

 

Section 5.1            Termination Events.

 

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

 

(a)           Any Originator shall fail (i) to make any payment or deposit
required hereunder when due and such failure shall continue for one (1) Business
Day after notice thereof has been given by the Buyer (or its assigns) to such
Originator, 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)           Any representation or warranty made by any Originator in any
Transaction Document to which it is a party or in any other document delivered
pursuant thereto shall prove to have been incorrect when made or deemed made or
any other certification or statement by any Originator shall prove to have been
incorrect in any material respect when made or deemed made.

 

(c)           Failure of any Originator to pay any Indebtedness when due in
excess of $25,000,000; 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 that continues after the expiration of
any applicable cure period or grace period or that is not waived by the holder
or holders of such Indebtedness, 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 their respective Subsidiaries.

 

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(e)           A Change of Control shall occur.

 

(f)            One or more final judgments for the payment of money in an amount
in excess of $25,000,000, individually or in the aggregate, shall be entered
against any Originator on 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 thirty (30)
consecutive days without a stay of execution.

 

(g)           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 and
Related Security and such lien shall continue until the earlier of (i) seven (7)
days after inception and (ii) knowledge by any Secured Party of such lien, or
the PBGC shall, or shall indicate its intention to, file notice of a lien
pursuant to Section 4068 of ERISA with regard to any of the Receivables and
Related Security.

 

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

 

(i)                                     shall fail to be funded in accordance
with the minimum funding standard resulting from an accumulated funding
deficiency as 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 such 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 such 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.

 

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

 

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

 

Article VI

 

Indemnification

 

Section 6.1            Indemnities by 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
attorneys’ fees (which attorneys may be employees of Buyer or any such assign)
and disbursements (all of the foregoing being collectively referred to as
“Indemnified Amounts”) awarded against or incurred by any of them 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 any jurisdiction in which such Indemnified
Party’s principal executive office is located, 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, either directly or indirectly, by the Lender, any Committed Bank or
any Liquidity Bank of an interest in the Receivables under the Credit Agreement;

 

provided, however, that nothing contained in this sentence shall limit the
liability of any Originator or limit the recourse of Buyer to such 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,
each Originator shall indemnify Buyer for Indemnified Amounts in excess of any
Purchase Price Credit received by the Buyer with respect thereto, relating to or
resulting from:

 

20

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(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;

 

(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
related thereto 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

 

21

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of Originator’s right, title and interest in the Related Security associated
with the Receivables, in each case, free and clear of any Adverse Claim;

 

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

 

(xii)                             any action or omission by such Originator
which reduces or impairs the rights of Buyer 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 in any Purchase Report to be an Eligible Receivable on the
date of such Purchase Report.

 

Section 6.2            Defense of Claims.

 

(a)           An Indemnified Party shall, after obtaining actual knowledge,
thereof, promptly notify each Originators in writing of any Claim as to which
indemnification is sought (unless any Originator theretofore has notified such
Indemnified Party of such Claim); except that the failure to give such notice
shall not release any Originator from any of its obligations under this
Agreement, however, such Originator’s obligations shall be reduced to the extent
that failure to promptly give notice of any action, suit or proceeding against
such Indemnified Party (i) impairs such Originator from defending such Claim or
(ii) increases the amount for which such Originator is liable in accordance with
Section 6.1.  Within thirty (30) days after receiving notice from an Indemnified
Party of any Claim as to which indemnification is sought, each Originator, if it
so desires, may elect in writing, subject to the provisions of the following
paragraph, to control, at its sole cost and expense, and to assume full
responsibility for, the defense of such Claim with counsel acceptable to the
Indemnified Parties in their reasonable discretion; provided, that such
Originator has agreed in writing on or prior to the assumption of such defense
to indemnify such Indemnified Party for such Claim.  If any Originator elects to
assume the defense of such Claim, such Originator shall keep the Indemnified
Party which is the subject of such proceeding fully apprised of the status of
the proceeding and shall provide such Indemnified Party with all information
with respect to such proceeding as such Indemnified Party may reasonably
request.  If such Originator does not elect to assume control, as provided for
above, and provided it is not prevented from assuming such control pursuant to
the provisions of clause (b) below, the applicable Indemnified Party shall, at
the expense of such Originator supply such Originator with all such information
and documents reasonably requested by such Originator.

 

(b)           Notwithstanding any of the foregoing to the contrary, no
Originator shall be entitled to control and assume responsibility for the
defense of such Claim if in the reasonable opinion of such Indemnified Party (i)
there exists an actual or potential conflict of interest, such that such
Indemnified Party determines that it is desirable to retain control of such
proceeding (ii)

 

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such Claim involves the risk of criminal liability to such Indemnified Party or
(iii) the control of such Claim would involve a conflict of interest.  In the
circumstances described above, the Indemnified Party shall be entitled to
control and assume responsibility for the defense of such claim or liability,
subject to Section 6.1, at the expense of such Originator.

 

(c)           No Indemnified Party shall settle any Claim without the prior
consent of the applicable Originator (which consent shall not be unreasonably
withheld).  No Originator may settle any Claim without the prior written consent
of each affected Indemnified Party which consent may not be unreasonably
withheld or delayed in the case of a money settlement not involving an admission
of liability of such Indemnified Party, nor may any Originator settle any Claim
if such settlement results, or could reasonably be expected to result, in
criminal liability of such Indemnified Party.

 

Section 6.3            Other Costs and Expenses.

 

The Originators shall pay to Buyer on demand all 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
on demand any and all costs and expenses of Buyer, if any, including 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, Buyer and the
Administrative Agent and, to the extent required under the Credit Agreement, the
Liquidity Banks or the Required Liquidity Banks.  Any material amendment,
supplement, modification of waiver will required satisfaction of the Rating
Agency Condition.

 

23

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Section 7.2            Notices.

 

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

 

Section 7.3            Protection of Ownership Interests of Buyer.

 

(a)           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 Receivable Interests, or to enable Buyer (or its assigns) to
exercise and enforce their rights and remedies hereunder.  At any time, Buyer
(or its assigns) may, at the applicable Originator’s sole cost and expense,
direct such Originator to notify the Obligors of Receivables of the ownership
interests of Buyer under this Agreement and may also direct that payments of all
amounts due or that become due under any or all Receivables be made directly to
Buyer or its designee.

 

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

 

24

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Agent (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 Administrative Agent (as
Buyer’s assign) in connection with the perfection of the ownership or security
interests in favor of Buyer or the Administrative Agent (as Buyer’s assign).

 

Section 7.4            Confidentiality.

 

(a)           Each Originator shall maintain and shall cause each of its
employees and officers to maintain the confidentiality of this Agreement and the
other confidential or proprietary information with respect to the Administrative
Agent, any Committed Bank and Blue Ridge and their respective businesses
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 external accountants and attorneys and as required by any
applicable law or order of any judicial or administrative proceeding.

 

(b)           Anything herein to the contrary notwithstanding, each Originator
hereby consents to the disclosure of any nonpublic information with respect to
it (i) to Buyer, the Administrative Agent, the Committed Banks, the Liquidity
Banks or Blue Ridge by each other, (ii) by Buyer, the Administrative Agent, the
Lender or the Committed Banks to any prospective or actual assignee or
participant of any of them who executes a confidentiality agreement for the
benefit of any Originator on terms comparable to those required of Buyer
hereunder with respect to such disclosed information, and (iii) by the
Administrative Agent to any rating agency, Commercial Paper dealer or provider
of a surety, guaranty or credit or liquidity enhancement to Blue Ridge or any
entity organized for the purpose of purchasing, or making loans secured by,
financial assets for which Wachovia acts as the administrative agent, and (iv)
to any officers, directors, employees, outside accountants and attorneys of any
of the foregoing, provided that each such Person is informed of the confidential
nature of such information and in the case of any Person referred to in clause
(iii), the Buyer (or its assigns) shall use reasonable efforts to cause each
such Person to agree to keep such information confidential.  In addition, the
Committed Banks, Blue Ridge and the Administrative Agent may disclose any such
nonpublic information with respect to any Originator 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).

 

(c)           Buyer shall maintain and shall cause each of its employees and
officers to maintain the confidentiality of this Agreement and the other
confidential or proprietary information with respect to 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 Administrative Agent, the Committed Banks,
the Liquidity Banks and Blue Ridge, (ii) to any prospective or actual assignee

 

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or participant of the Administrative Agent, the Lender or the Committed Banks
who execute a confidentiality agreement for the benefit of such Originator and
Buyer on terms comparable to those required of Buyer hereunder with respect to
such disclosed information, (iii) to any rating agency, Commercial Paper dealer
or provider of a surety, guaranty or credit or liquidity enhancement to Blue
Ridge or any entity organized for the purpose of purchasing, or making loans
secured by, financial assets for which Wachovia acts as the administrative
agent, and (iv) to any officers, directors, employees, outside accountants and
attorneys of any of the foregoing, provided that each such Person is informed of
the confidential nature of such information and in the case of any Person
referred to in clause (iii), the Buyer (or its assigns) shall use reasonable
efforts to cause each such Person to agree to keep such information
confidential.  In addition, the Committed Banks, Blue Ridge and the
Administrative Agent may disclose any such nonpublic information 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).

 

Section 7.5            Bankruptcy Petition.

 

(a)           Each Originator 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 Blue Ridge, it will not institute against, or
join any other Person in instituting against, Blue Ridge 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 Originator 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 Credit 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 Blue Ridge, the Administrative Agent, any Committed Bank or any
Liquidity Bank, no claim may be made by any Originator, the Buyer or any of
their respective Affiliates, against Blue Ridge, the Administrative Agent 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

 

26

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OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW) OF THE STATE
OF NEW YORK.

 

Section 7.8            CONSENT TO JURISDICTION.

 

EACH ORIGINATOR 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 ORIGINATOR 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 ORIGINATOR IN THE COURTS OF ANY OTHER JURISDICTION.  ANY
JUDICIAL PROCEEDING BY 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 ORIGINATOR PURSUANT TO THIS AGREEMENT SHALL BE BROUGHT ONLY IN A
COURT IN NEW YORK, NEW YORK.

 

Section 7.9            WAIVER OF JURY TRIAL.

 

TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, 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 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 and the Administrative Agent.  Buyer may, without the
consent of the Originators, assign to the Administrative Agent, for the benefit
of the

 

27

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Secured Parties, its rights, remedies, powers and privileges hereunder and the
Administrative Agent may further assign such rights, remedies, powers and
privileges to the extent permitted in the Credit Agreement.  Each Originator
agrees that the Administrative Agent, as the assignee of Buyer, shall, subject
to the terms of the Credit Agreement, have the right to enforce this Agreement
and to exercise directly all of Buyer’s rights and remedies under this Agreement
(including, without limitation, the right to give or withhold any consents or
approvals of Buyer to be given or withheld hereunder) and such Originator agrees
to cooperate fully with the Administrative Agent in the exercise of such rights
and remedies.  This Agreement shall create and constitute the continuing
obligations of the parties hereto in accordance with its terms and shall remain
in full force and effect until terminated in accordance with its terms;
provided, however, that the rights and remedies with respect to (i) any breach
of any representation and warranty made by 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.

 

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 shall be effective as delivery of 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]

 

 

28

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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.

 

 

LOUISIANA-PACIFIC CORPORATION

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

 

Address:

 

805 S.W. Broadway

 

Portland, Oregon 97205-3033

 

 

 

LP WOOD POLYMERS, INC.

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

Address:

 

c/o Louisiana-Pacific Corporation

 

805 S.W. Broadway

 

Portland, Oregon 97205-3033

 

 

LP RECEIVABLES CORPORATION

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

Address:

 

c/o Louisiana-Pacific Corporation

 

805 S.W. Broadway

 

Portland, Oregon 97205-3033

 

 

 

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Exhibit I

 

Definitions

 

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

 

Administrative Agent:  As defined in the Preliminary Statements..

 

Agreement:  The Receivables Sale Agreement, dated as of November 15, 2001,
between Originators and Buyer, as the same may be amended, restated or otherwise
modified.

 

Blue Ridge:  As defined in the Preliminary Statements..

 

Buyer:  As defined in the preamble.

 

Calculation Period:  Each Fiscal Month or portion thereof which elapses during
the term of the Agreement.  The first Calculation Period shall commence on the
date of the first Purchase 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 delivered to Buyer and the Administrative Agent, as modified from time to
time in accordance with the Agreement.

 

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

 

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

 

Discount Factor:  As of any date, the quotient obtained by dividing (a) one, by
(b) one plus the Discount Rate as of such date.

 

Discount Rate:  As of any date, the product of (i) the sum of the Weighted
Average Interest Rate, the Service Fee Rate and the Profit Rate as of such date
and (ii) the quotient obtained by dividing (a) the Days Sales Outstanding as of
such date, by (b) 360.

 

Eligible Receivables Finance Percentage:  As of any date, one minus the greater
of (i) the Required Reserve Factor Floor as of such date or (ii) the sum of the
Loss Reserve, the Interest Reserve, the Dilution Reserve, the Cash Discount
Reserve, the Rebate Reserve and the Servicing Reserve, each as of such date.

 

Eligible Receivables Pool Percentage:  As of any date, the quotient obtained by
dividing (i) the aggregate Outstanding Balance of all Eligible Receivables as of
the Cut-Off Date immediately

 

I-1

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preceding such date.by (ii) the aggregate Outstanding Balance of all Receivables
as of the Cut-Off Date immediately preceding such date.

 

ERISA Event:  (i) a Reportable Event with respect to a Pension Plan; (ii) a
withdrawal by Originator or any ERISA Affiliate from a Pension Plan subject to
Section 4063 of ERISA during a plan year in which it was a substantial employer
(as defined in Section 4001 (a) (2) of ERISA) or a cessation of operations which
is treated as such a withdrawal under Section 4062(e) of ERISA; (iii) a complete
or partial withdrawal by Originator or any ERISA Affiliate from a Multiemployer
Plan or notification that a Multiemployer Plan is in reorganization; (iv) the
filing of a notice of intent to terminate, the treatment of a Plan amendment as
a termination under Section 4041 or 4041A of ERISA, or the commencement of
proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan; (v)
an event or condition which might reasonably be expected to constitute grounds
under Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Pension Plan or Multiemployer Plan; or (vi) the
imposition of any liability under Title IV of ERISA, other than PBGC premiums
due but not delinquent under Section 4007 of ERISA, upon Originator or any ERISA
Affiliate.

 

Initial Contributed Receivables:  As defined in Section 1.1.

 

Initial Cutoff Date:  As defined in Section 1.1.

 

Loss Discount Factor: As of any date, one minus the quotient obtained by
dividing (i) the losses (i.e., write-offs to the bad debt reserve or other
write-offs consistent with the Credit and Collection Policy, in each case, net
of recoveries) recognized for all Receivables during the period equal to twelve
successive Calculation Periods ending on the Cut-Off Date immediately preceding
such date, by (ii) the Collections on all Receivables received during such
period.

 

Material Adverse Effect:  A material adverse effect on (i) the financial
condition or operations of any Originator and any of their respective
Subsidiaries taken as a whole, (ii) the ability of any Originator to perform its
obligations under this Agreement or any other Transaction Document to which it
is a party, (iii) the legality, validity or enforceability of this Agreement or
any other Transaction Document against any Originator, (iv) the Buyer’s (or its
assigns’) security interest in the Receivables generally or in any significant
portion of the Receivables, the Related Security or Collections with respect
thereto, or (v) the collectibility of the Receivables generally or of any
material portion of the Receivables.

 

Multiemployer Plan:  A “multiemployer plan”, within the meaning of Section 4001
(a) (3) of ERISA, to which Originator or any ERISA Affiliate makes, is making,
or is obligated to make contributions or, during the preceding three calendar
years, has made, or been obligated to make, contributions.

 

Net Receivables Balance:  With respect to any Purchase from an Originator, an
amount equal to the product of (i) the Outstanding Balance of the Receivables
being purchased as of the date of Purchase and (ii) the Loss Discount Factor.

 

2

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

 

Net Worth:  As of the last Business Day of each Calculation Period preceding any
date of determination, the excess, if any, of (i) the aggregate Outstanding
Balance of the Receivables at such time, over (ii) the sum of (1) the Aggregate
Principal outstanding at such time, plus (2) the aggregate outstanding principal
balance of the Subordinated Loans (including any Subordinated Loan proposed to
be made on the date of determination).

 

Non-Program Interest Rate:  As of any date, the sum of (i) the offered per annum
rate (rounded upwards to the nearest 1/16th of one percent) appearing in The
Wall Street Journal for three month LIBOR loans on the immediately preceding
Cut-Off Date and (ii) 3.00%.

 

Organizational Documents:  For any Person, the documents for its formation and
organization, which, for example, (i) for a corporation are its corporate
charter and bylaws, (ii) for a partnership are its certificate of partnership
(if applicable) and partnership agreement, (iii) for a limited liability company
are its certificate of formation or organization and its operating agreement,
regulations or the like and (iv) 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.

 

Originator Representative:  As defined in the Subordinated Note.

 

Profit Rate:  1.00% per annum.

 

Program Interest Rate:  As of any date, the sum of (i) the per annum rate
(rounded upwards to the nearest 1/16 of one percent) appearing in The Wall
Street Journal for 90-day dealer commercial paper on the immediately preceding
Cut-Off Date and (ii) the then applicable per annum Program Fee Rate (as defined
in the Fee Letter) for CP Loans.

 

Purchase:  The purchase, transfer and assignment (whether by sale, capital
contribution or otherwise), pursuant to Section 1.2(a) of the Agreement by Buyer
from an Originator of the Receivables and the Related Security and Collections
related thereto, together with all related rights in connection therewith.

 

Purchase Price:  With respect to any Purchase from an Originator, the aggregate
price to be paid by Buyer to such Originator in accordance with the terms of
Section 1.3 of the Agreement for the Receivables, the Collections and the
Related Security that are the subject of such Purchase, which price shall equal
(i) the product of (A) the Net Receivables Balance of the Receivables that are
the subject of such Purchase and (B) the then applicable Discount Factor, minus
(ii) any outstanding Purchase Price Credits that have not previously been paid
in accordance with Section 1.4.

 

Purchase Price Credit:  As defined in Section 1.4

 

3

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

 

Purchase Report:  As defined in Section 1.2(b)

 

Purchase Settlement Date:  The second (2nd) Business Day after each Scheduled
Monthly Reporting Date.

 

Receivable:  All indebtedness and other obligations owed to each 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 such 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 inventory by an Originator to
any Obligor which, if a natural person, is a resident of the United States or,
if a corporation or other business organization, is organized under the laws of
the United States or any political subdivision thereof and has its chief
executive office in the United States, and further includes, without limitation,
the obligation to pay any Finance Charges with respect thereto.  Indebtedness
and other rights and obligations arising from any one transaction, including,
without limitation, indebtedness and other rights and obligations represented by
an individual invoice, shall constitute a Receivable separate from a Receivable
consisting of the indebtedness and other rights and obligations arising from any
other transaction; provided, further, that any indebtedness, rights or
obligations referred to in the immediately preceding sentence shall be a
Receivable regardless or whether the account debtor such Originator treats such
indebtedness, rights or obligations as a separate payment obligation.

 

Related Security:  With respect to any Receivable:

 

(i)                                     All of each 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 an Originator gave rise to such
Receivable, and all insurance contracts with respect thereto,

 

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

 

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

 

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

 

(v)                                 all Records related to such Receivable,

 

4

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

 

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

 

(vii)                           all proceeds of any of the foregoing.

 

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 (i) 3% of the Aggregate Commitment under the Credit Agreement,
and (ii) the product of (A) 1.5 times the product of the Default Ratio times the
Default Horizon Ratio, each as determined from the most recent Monthly Report
received from the Master Servicer under the Credit Agreement, and (B) the
Outstanding Balance of all Receivables as reported on the most recent Monthly
Report, as determined from the most recent Monthly Report received from the
Master Servicer under the Credit Agreement.

 

Subordinated Loan:  As defined in Section 1.3(a)(ii) 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 (i) the Facility Termination Date
(as defined in the Credit Agreement), (ii) the Business Day immediately prior to
the occurrence of a Termination Event set forth in Section 5.1(d), (iii) the
Business Day specified in a written notice from Buyer to Originator following
the occurrence of any other Termination Event, and (iv) the date which is one
(1) Business Day after Buyer’s receipt of written notice from an Originator that
it wishes 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.

 

Weighted Average Interest Rate:  As of any date, the sum of (i) the product of
(A) the Program Interest Rate, (B) the Eligible Receivables Pool Percentage, and
(C) the Eligible Receivables Finance Percentage, all as of such date, and
(ii) the product of (A) the Non-Program Interest Rate and (B) one minus the
product of (1) the Eligible Receivables Pool Percentage and (2) the Eligible
Receivables Finance Percentage, all as of such date.

 

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

 

5

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Exhibit II

 

Jurisdiction of Formation; Places of Business; Locations of Records;

Federal Employer Identification Number(s); Other Names

Louisiana-Pacific Corporation

 

Jurisdiction of Formation: Delaware

 

Places of Business: 805 S.W Broadway, Portland, Oregon 97205-3033 (Chief
Executive Office)

 

Locations of Records:

 

N. 13403 Government Way

Hayden Lake, Idaho  83835

 

340 E. Big Beaver Rd. #105

Troy, Michigan  48083

 

10115 Kincey Ave #150

Huntersville, NC  28078

 

Federal Employer Identification Number: 93-0609074

 

Legal, Trade and Assumed Names: Louisiana-Pacific Corporation.

 

 

LP Wood Polymers, Inc.

 

Jurisdiction of Formation: Oregon

 

Places of Business: 805 S.W Broadway, Portland, Oregon 97205-3033 (Chief
Executive Office)

 

Locations of Records:

 

N. 13403 Government Way

Hayden Lake, Idaho  83835

 

340 E. Big Beaver Rd. #105

Troy, Michigan  48083

 

10115 Kincey Ave #150

Huntersville, NC  28078

 

II-1

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

 

Federal Employer Identification Number: 93-1286785

 

Legal, Trade and Assumed Names: LP Wood Polymers, Inc.

 

Prior Names Used During Previous Five Years:  ABT Deck, Inc.

 

Exh I-2

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

 

Exhibit III

 

Lock-boxes; Collection Accounts; Collection Banks

 

Company

 

Bank Name

 

Account No.

 

Acct. Purpose

 

Bank Address

 

City

 

State

 

Zip

LP Corp

 

Bank of America

 

12330-53134

 

Lockbox Account

 

File # 53564

 

Los Angeles

 

CA

 

90074

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LP Corp

 

Bank of America

 

4970094285

 

Depository

 

2900 W. Davis

 

Conroe

 

TX

 

77304

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LP Corp

 

Idaho Independent Bank

 

0200003838

 

Depository

 

8882 N. Government Way

 

Hayden Lake

 

ID

 

83835

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LP Corp

 

Wachovia Atlanta

 

1864085323

 

Lockbox Account

 

PO Box 920022

 

Atlanta

 

GA

 

30392

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LP Corp

 

Wachovia Dallas

 

1864085323

 

Lockbox Account

 

PO Box 951235

 

Dallas

 

TX

 

75395

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LP Corp

 

Wells Fargo-Regulus West

 

4159576628

 

Lockbox Account

 

PO Box 4000-98

 

Portland

 

OR

 

97208

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LP Corp

 

Wells Fargo-Regulus West

 

4159576628

 

Lockbox Account

 

PO Box 44479

 

San Francisco

 

CA

 

94144

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LP Corp

 

First Union National Bank

 

2000000717265

 

Lockbox Account

 

PO Box 60335

 

Charlotte

 

NC

 

28260

 

III-1

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

 

Exhibit IV

 

Form of Compliance Certificate

 

This Compliance Certificate is furnished pursuant to that certain Receivables
Sale Agreement dated as of ______________, 2001, between the originators named
therein and LP Receivables Corporation (the “Agreement”).  Capitalized terms
used and not otherwise defined herein are used with the meanings attributed
thereto in the Agreement.

 

THE UNDERSIGNED HEREBY CERTIFIES THAT:

 

1.             I am the duly elected ______________ of [name of Originator]
(“Originator”).

 

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

 

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

 

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

 

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

 

 

 

 

 

[Name]

 

 

 

IV-1

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

 

Exhibit V

 

Credit and Collection Policy

 

[Previously Provided Under Separate Cover]

 

 

V-1

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

 

Exhibit VII

 

Form of Subordinated Note

 

SUBORDINATED NOTE

 

November 15, 2001

 

1.             Note.  FOR VALUE RECEIVED, the undersigned, LP RECEIVABLES
CORPORATION, a Delaware corporation (“SPV”), hereby unconditionally promises to
pay to the order of Louisiana-Pacific Corporation, a Delaware corporation (the
“Originator Representative”) for the benefit of Louisiana-Pacific Corporation
and LP Wood Polymers, Inc. (each an “Originator” and collectively, the
“Originators”), pursuant to that certain Receivables Sale Agreement, dated as of
November 15, 2001, by and among the Originators and the SPV (as amended,
restated, supplemented or otherwise modified from time to time, the “Sale
Agreement”), in lawful money of the United States of America and in immediately
available funds, on or before the date following the Termination Date which is
one year and one day after the date on which (i) the Outstanding Balance of all
Receivables sold under the Sale Agreement has been reduced to zero and (ii) each
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 the Originators to SPV pursuant
to and in accordance with the terms of 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 Representative is authorized and
directed by SPV to enter on the grid attached hereto on behalf of each
Originator, or, at its option, cause to be

 

VI-1

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

 

entered in the books and records of each Originator, the date and amount of each
loan made by each Originator 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
Representative to make any such entry nor any error therein shall expand, limit
or affect the obligations of SPV hereunder.

 

4.             Subordination.  Originator Representative shall have the right to
receive, on behalf of each of the Originators, and SPV shall make, any and all
payments and prepayments relating to the loans made under this Subordinated
Note, provided that, after giving effect to any such payment or prepayment, the
aggregate Outstanding Balance of Receivables (as each such term is defined in
the Credit Agreement hereinafter referred to) owned by SPV at such time exceeds
the sum of (i) the Aggregate Unpaids (as defined in the Credit Agreement)
outstanding at such time under the Credit Agreement, plus (ii) the aggregate
outstanding principal balance of all loans made under this Subordinated Note. 
Each Originator and Originator Representative hereby agrees that at any time
during which the conditions set forth in the proviso of the immediately
preceding sentence shall not be satisfied, each Originator and Originator
Representative shall be subordinate in right of payment to the prior payment of
any indebtedness or obligation of SPV owing to the Administrative Agent, the
Lender or any Committed Bank under the Credit Agreement.  The subordination
provisions contained herein are for the direct benefit of, and may be enforced
by, the Administrative Agent, the Lender and the Committed Banks and/or any of
their respective assignees (collectively, the “Senior Claimants”) under the
Credit Agreement.  Until the date on which the “Aggregate Principal” outstanding
under the Credit Agreement has been repaid in full and all other obligations of
SPV and/or the Master Servicer thereunder and under the “Fee Letter” referenced
therein (all such obligations, collectively, the “Senior Claim”) have been
indefeasibly paid and satisfied in full, no Originator nor Originator
Representative shall 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 any Originator or Originator Representative on behalf of the
Originators in violation of this Section 4, each such Originator or Originator
Representative, as the case may be, agrees that such payment shall be
segregated, received and held in trust for the benefit of, and deemed to be the
property of, and shall be immediately paid over and delivered to the
Administrative Agent for the benefit of the Senior Claimants.

 

5.             Bankruptcy; Insolvency.  Upon the occurrence of any proceeding of
the type described in Section 5.1(d) of the Sale Agreement involving SPV as
debtor, then and in any such event the Senior Claimants shall receive payment in
full of all amounts due or to become due on or in respect of the Aggregate
Principal and the Senior Claim (including “Interest” as defined and as accruing
under the Credit Agreement after the commencement of any such proceeding,
whether or not any or all of such Interest is an allowable claim in any such
proceeding) before Originator Representative is entitled to receive payment on
behalf of the Originators 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

 

VI-2

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

 

all indebtedness under this Subordinated Note, is hereby assigned to and shall
be paid or delivered by the Person making such payment or delivery (whether a
trustee in bankruptcy, a receiver, custodian or liquidating trustee or
otherwise) directly to the Administrative Agent for application to, or as
collateral for the payment of, the Senior Claim until such Senior Claim shall
have been paid in full and satisfied.

 

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 Administrative Agent for the benefit of the Secured
Parties.

 

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.  Each Originator and Originator Representative 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 Representative on
behalf of the Originators without the prior written consent of the
Administrative Agent, and any such attempted transfer shall be void.

 

 

LP RECEIVABLES CORPORATION

 

 

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

 

VI-3

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

 

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)

 

Name of
Originator

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

S-1

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

 

Exhibit VII

 

[Form of] Purchase Report

[Name of Originator]

 

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

 

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

 

 

 

 

 

Aggregate Outstanding Balance of
all Receivables sold during the period

$_____________

 

A

Less:  Purchase Price discount during the
Period:

$(____________)

 

(B)

Equals:  Gross Purchase Price Payable
during the period (A — B)

 

$____________

=C

Less:  Total Purchase Price Credits arising
during the Period:

$(____________)

 

(D)

Equals:  Net Purchase Price payable during
the Period (C — D):

 

$____________

=E

Cash Purchase Price Paid to Originator
during the Period:

$_____________

 

F

Subordinated Loans made during the Period:

$_____________

 

G

Less:  Repayments of Subordinated Loans
received during the Period:

$(____________)

 

(H)

Equals:  Purchase Price paid in Cash or
Subordinated Loans during the period
(F + G - H):

 

$_____________

=I

Aggregate Outstanding Balance of
Receivables contributed during the Period:

$_____________

 

J

 

 

VII-1

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

 

Exhibit VIII

 

Material Adverse Effect

 

Since June 30, 2001, Louisiana-Pacific Corporation has filed the following
reports with the Securities and Exchange Commission:

 

1.                    Quarterly Report on Form 10-Q filed on August 14, 2001.

2.                    Current Report on Form 8-K filed on August 13, 2001

3.                    Current Report on Form 8-K filed on July 20, 2001.

 

In addition, on October 24, 2001, Louisiana-Pacific released a press release
regarding its third quarter 2001 financial results.  (A copy of such release is
attached hereto.)

 

Except for facts disclosed or described in the foregoing reports and press
release, since June 30, 2001, no event has occurred that would a material
adverse effect on the financial condition or operations of Louisiana-Pacific and
its Subsidiaries, taken as a whole, or the ability of Louisiana-Pacific to
perform its obligations under this Agreement.

 

S-2

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

 

Schedule A

 

LIST OF DOCUMENTS TO BE DELIVERED

TO BUYER ON OR PRIOR TO CLOSING DATE

 

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

 

2.                                       Copy of the Credit and Collection
Policy.

 

3.                                       A certificate of each Originator’s
Secretary certifying:

 

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

 

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

 

(c)                                  Good Standing Certificates for each
Originator issued by the Secretary of State of such Originator’s state of
incorporation and each jurisdiction where such Originator has material
operations, each of which is listed below, dated on or within thirty (30) days
prior to closing:

 

a.                                       Louisiana-Pacific Corporation: Alabama,
California, Colorado, Delaware, Florida, Georgia, Idaho, Indiana, Louisiana,
Maine, Michigan, Minnesota, Mississippi, Montana, North Carolina, Ohio, Oregon,
Texas, Washington, Wisconsin, Wyoming;

 

b.                                      LP Wood Polymers, Inc.: Oregon, Idaho.

 

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

 

4.             Pre-filing state and federal tax lien, judgment lien and UCC lien
searches against each Originator dated on or within thirty (30) days prior to
closing from the following jurisdictions:

 

(a)           Louisiana-Pacific Corporation: Delaware, Oregon, Multnomah,
Oregon;

 

(b)           LP Wood Polymers, Inc.: Delaware, Oregon, Multnomah, Oregon.

 

5.             Time stamped receipt copies of proper financing statements, duly
filed under the UCC on or before the date of the initial Purchase (as defined in
the Receivables Sale Agreement) in all jurisdictions as may be necessary or, in
the opinion of Buyer (or its assigns), desirable,

 

SA-1

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under the UCC of all appropriate jurisdictions or any comparable law in order to
perfect the ownership interests contemplated by the Receivables Sale Agreement.

 

6.             Time stamped receipt copies of proper UCC termination statements,
if any, necessary to release all security interests and other rights of any
Person in the Receivables, Contracts or Related Security previously granted by
any Originator.

 

7.             Executed copies of Collection Account Agreements for each
Lock-Box and Collection Account.

 

8.             A favorable opinion of legal counsel for the Originators
reasonably acceptable to the Administrative Agent which addresses the following
matters and such other matters as the Administrative Agent may reasonably
request:

 

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

 

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

 

(c)           the existence of a “true sale” of the Receivables from each
Originator to the Buyer under the Receivables Sale Agreement;

 

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

 

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

 

10.           Executed copies of 1. all consents from and authorizations by any
Persons and 2. 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 Administrative Agent, as its assignee) and directing
warehousemen to allow Buyer (and the Administrative Agent, as its assignee) to
inspect and make copies from such Originator’s books and records maintained at
off-site data processing or storage facilities.

 

SA-2

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