ex10_5.htm


     

    
      
        EXHIBIT
10.5

        
          Amended
and Restated Revolving Credit Agreement

        

        
          


        

        

          
            

          

        

      

    

    


    This
AMENDED AND RESTATED REVOLVING
CREDIT AGREEMENT is dated as of May 28, 2004 (as amended, supplemented or
otherwise modified from time to time, this “Agreement”), among UNION
CARBIDE CORPORATION, a New York corporation (“Carbide” or “Borrower”), as borrower, THE
DOW CHEMICAL COMPANY, a Delaware corporation (“TDCC” or “Lender”), as lender, and
UNION CARBIDE SUBSIDIARY C, INC., UNION CARBIDE CHEMICALS & PLASTICS
TECHNOLOGY CORPORATION, UCMG LLC, AND CATALYSTS, ADSORBENTS AND PROCESS SYSTEMS,
INC. as the SUBSIDIARY GUARANTORS.

     

     

    W
I T N E S S E T H:

     

    WHEREAS, Lender and Borrower are
parties to a Revolving Credit Agreement dated as of March 25, 2003, which was
previously amended pursuant to the First Amendment to Revolving Credit Agreement
dated as of March 25, 2003, and pursuant to the Second Amendment to Revolving
Credit Agreement dated as of January 1, 2004 (as in effect immediately prior to
the date hereof, the “Credit
Agreement”);

     

    WHEREAS,
TDCC wishes to continue lending funds to Carbide from time to time, and Carbide
wishes to continue borrowing such funds on the terms and conditions set forth in
this Agreement;

     

    WHEREAS, under Section 10.5 of the
Credit Agreement, TDCC has the right at any time and from time to time, to set
off and apply any and all funds at any time held, and other indebtedness or
other amounts at any time owing by TDCC to Carbide, against any and all amounts
owing by Carbide to TDCC, and TDCC will, prior to the effectiveness of this
Agreement and as a condition precedent to its effectiveness, exercise its set
off right in an amount equal to $184,173,699.83 of its obligations to Carbide
under the Amended and Restated Revolving Loan Agreement among Carbide, as
lender, and TDCC, as borrower, dated as of December 1, 2001, as amended (such
exercise of a set off right as described in this clause, the “Lender Set
Off”);

     

    WHEREAS, Lender will release certain
collateral previously pledged by Borrower to secure its obligations under the
Credit Agreement, some of which will be released on the Effective Date
contemporaneously with the Lender Set Off, and some of which will be released
following the Effective Date upon the build up of cash collateral pursuant to
the terms and conditions of this Agreement and the Amended and Restated Pledge
and Security Agreement;

     

    WHEREAS,
to the extent that existing collateral is released and replaced by substituting
Collateral, it is the intent of the parties to this Agreement that such
replacement of collateral be deemed an exchange or substitution of property of
equal or lesser value, consummated contemporaneously with the partial release of
the existing collateral.

     

    NOW, THEREFORE, in consideration of the
premises and the covenants and agreements contained herein, the parties hereto
hereby agree as follows:

     

     

    ARTICLE
I

    DEFINITIONS,
INTERPRETATION AND ACCOUNTING TERMS

     

    Section
1.1.                      Defined
Terms.  As
used in this Agreement, the following terms have the following meanings (such
meanings to be equally applicable to both the singular and plural forms of the
terms defined):

     

    “Account” has the meaning
specified in the UCC.

     

    “Affiliate” means, with
respect to any Person, any other Person which, directly or indirectly, controls,
is controlled by or is under common control with such Person and each officer,
director or general partner of such Person.  For the purposes of this
definition, “control” means the possession of the power to direct or cause the
direction of management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise.  For
purposes hereof, Borrower and its Subsidiaries shall not be deemed to be
Affiliates of Lender and Lender’s other Affiliates.

     

    “Agreement” has the meaning
specified in the preamble to this Agreement.

     

    “Amended and Restated Pledge and
Security Agreement” means the Amended and Restated Pledge and Security
Agreement dated as of the date hereof, between Borrower and Lender, as amended
from time to time.

     

    “Applicable Rate” means, as of
any date of determination, LIBOR plus 2.5%.

     

    “Approved Deposit Account”
means each bank account established or maintained by Borrower with a bank
acceptable to Lender for purposes of receivables collection and subject to a
Deposit Account Control Agreement.

     

    


    
      
        
           


        

        
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    “Asset Sale” has the meaning
specified in Section 8.3.

     

    “Bankruptcy Code” means Title
11, United States Code, as amended from time to time.

     

    “Business Day” means a day of
the year on which banks are not required or authorized to close in New York
City.

     

    “Capital Lease” means, with
respect to any Person, any lease of property by such Person as lessee which
would be accounted for as a capital lease on a balance sheet of such Person
prepared in conformity with GAAP.

     

    “Capital Lease Obligations”
means, with respect to any Person, the capitalized amount of all obligations of
such Person or any of its Subsidiaries under Capital Leases, as determined on a
consolidated basis in conformity with GAAP.

     

    “Cash Collateral Account”
means each bank account in respect of which Lender is the “customer” (as defined
in Section 4-104 of the UCC) of the depository bank and that is designated by
Lender for purposes of holding the Deposited Cash Collateral in accordance with
Section 7.9(a) hereof.

     

    “Cash Collateralized Credit
Enhancements” means, as of any determination date, the portion of all
Credit Enhancement Contingent Liabilities that is fully cash collateralized in
the amounts and pursuant to the other relevant terms and conditions set forth in
Section 7.9(a) hereof as of such date, regardless of whether Lender has drawn,
borrowed against or otherwise used such cash collateral pursuant to Section
7.9(c).

     

    “Cash Equivalents” means (a)
securities issued or fully guaranteed or insured by the United States government
or any agency thereof, (b) certificates of deposit, eurodollar time deposits,
overnight bank deposits and bankers’ acceptances of any commercial bank
organized under the laws of the United States, any state thereof, the District
of Columbia, any foreign bank, or its branches or agencies (fully protected
against currency fluctuations) which, at the time of acquisition, are rated at
least “A-1” by Standard & Poor’s Rating Services (“S&P”) or “P-1” by Moody’s
Investors Services, Inc. (“Moody’s”), (c) commercial
paper of an issuer rated at least “A-1” by S&P or “P-1” by Moody’s, and (d)
shares of any money market fund that (i) has at least 95% of its assets invested
continuously in the types of investments referred to in clauses (a) through (c)
above, (ii) has net assets of not less than $1,000,000,000 and (iii) is rated at
least “A-1” by S&P or “P-1” by Moody’s; provided, however, that the
maturities of all obligations of the type specified in clauses (a) above shall
not exceed 1 year and in clauses (b) and (c) above shall not exceed 270
days.

     

    “Change of Control” means (x)
any direct or indirect transfer or change of ownership interest in Borrower that
results in Lender owning, directly or indirectly, less than eighty percent (80%)
of the voting rights and economic interest of Borrower, or (y) control of
Borrower is removed from Lender’s board of directors or any entity other than
Lender or a Lender Affiliate replaces a majority of the directors that
constitute Borrower’s board of directors.

     

    “Code” means the Internal
Revenue Code of 1986 (or any successor legislation thereto), as amended from
time to time.

     

    “Collateral” means all
property and interests in property and proceeds thereof now owned or hereafter
acquired by Borrower in or upon which a Lien is granted under any of the
Collateral Documents.

     

    “Collateral Documents” means
the Amended and Restated Pledge and Security Agreement, the Subsidiary
Guarantees, any Deposit Account Control Agreement, any agreements governing the
Cash Collateral Accounts, and any other document executed and delivered by
Borrower or any of its Subsidiaries granting a Lien on any of such Person’s
property to secure payment of the Obligations of Borrower
hereunder.

     

    “Commitment” means the
commitment of Lender to make Loans in the aggregate principal amount outstanding
not to exceed $1,000,000,000 and as such amount may be reduced or increased
pursuant to this Agreement.

     

    “Constituent Documents” means,
with respect to any Person, (i) the articles/certificate of incorporation (or
the equivalent organizational documents) of such Person, (ii) the by-laws (or
the equivalent governing documents) of such Person and (iii) any document
setting forth the manner of election and duties of the directors or managing
members of such Person (if any) and the designation, amount and/or relative
rights, limitations and preferences of any class or series of such Person’s
Stock.

     

    “Contractual Obligation” of
any Person means any obligation, agreement, undertaking or similar provision of
any Security issued by such Person or of any agreement, undertaking, contract,
lease, indenture, mortgage, deed of trust or

     

    


    
      
        
           


        

        
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    other
instrument (excluding any Loan Document) to which such Person is a party or by
which it or any of its property is bound or to which any of its properties is
subject.

     

    “Credit Agreement” has the
meaning specified in the preamble to this Agreement.

     

    “Credit Enhancement” means any
indemnity, letter of credit, guarantee or other credit enhancement or financial
accommodation made or extended by Lender in favor of a third party as security
for obligations of Borrower or its Subsidiary to such third party.

     

    “Credit Enhancement Contingent
Liabilities” means, at any time with respect to the Credit Enhancements,
the amount of contingent liabilities owed by Borrower to Lender at such time
pursuant to the Reimbursement Agreements relating to the Credit Enhancements,
but excluding the sum of all Reimbursement Obligations.

     

    “Credit Enhancement
Obligations” means, at any time with respect to any Credit Enhancement,
the liability at such time of Borrower to Lender with respect to such Credit
Enhancement, whether or not any such liability is contingent, and includes the
sum of all Reimbursement Obligations and Credit Enhancement Contingent
Liabilities relating to such Credit Enhancement Obligation.

     

    “Credit Enhancement Request”
has the meaning specified in Section 2.4(c).

     

    “Customary Permitted Liens”
means, with respect to any Person, any of the following Liens:

     

    (a)    
      Liens with respect to the payment of taxes,
customs duties, assessments or governmental charges in all cases which are not
yet due or which are being contested in good faith by appropriate proceedings
and with respect to which adequate reserves or other appropriate provisions are
being maintained to the extent required by GAAP;

     

    (b)           Liens
of landlords arising by statute and liens of suppliers, mechanics, carriers,
materialmen, warehousemen or workmen and other liens imposed by law created in
the ordinary course of business for amounts not yet due or which are being
contested in good faith by appropriate proceedings and with respect to which
adequate reserves or other appropriate provisions are being maintained to the
extent required by GAAP;

     

    (c)           deposits
made in the ordinary course of business in connection with worker’s
compensation, unemployment insurance or other types of social security benefits
or to secure the performance of bids, tenders, sales, contracts (other than for
the repayment of borrowed money) and surety, appeal, customs or performance
bonds;

     

    (d)           encumbrances
arising by reason of zoning restrictions, easements, licenses, reservations,
covenants, rights-of-way, utility easements, building restrictions and other
similar encumbrances on the use of real property which do not materially detract
from the value of such real property or interfere with the ordinary conduct of
the business conducted and proposed to be conducted at such real
property;

     

    (e)           encumbrances
arising under leases or subleases of real property which do not in the aggregate
materially detract from the value of such real property or interfere with the
ordinary conduct of the business conducted and proposed to be conducted at such
real property;

     

    (f)           financing
statements of a lessor’s rights in and to personal property leased to such
Person in the ordinary course of such Person’s business;

     

    (g)           expired
financing statements and financing statements filed for precautionary purposes
in respect of operating leases; and

     

    (h)           Liens
in favor of banks which arise under Article 4 of the New York UCC on items in
collection and documents relating thereto and proceeds thereof.

     

    “Debt Issuance” means the
incurrence of indebtedness for borrowed money by Carbide or any of its
Subsidiaries, other than Intercompany Indebtedness.

     

    “Default” means any event
which with the passing of time or the giving of notice or both would become an
Event of Default.

     

    


    
      
        
           


        

        
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    “Deposit Account Control
Agreement” has the meaning specified in the Amended and Restated Pledge
and Security Agreement.

     

    “Deposited Cash Collateral”
means the cash collateral posted by Borrower in accordance with Section 7.9(a),
regardless of whether Lender has drawn, borrowed against or otherwise used such
cash collateral pursuant to Section 7.9(c).

     

    “Document” has the meaning
specified in the Amended and Restated Pledge and Security
Agreement.

     

    “Effective Date” has the
meaning specified in Section 3.1.

     

    “Equipment” has the meaning
specified in the UCC.

     

    “Equity Issuance” means the
issue or sale of any Stock of Borrower or any of its Subsidiaries to any Person
other than Borrower or any of its Subsidiaries.

     

    “Event of Default” has the
meaning specified in Section 9.1.

     

    “Fair Market Value” means (a)
with respect to any asset or group of assets (other than a marketable Security)
at any date, the value of the consideration obtainable in a sale of such asset
at such date assuming a sale by a willing seller to a willing purchaser dealing
at arm’s length and arranged in an orderly manner over a reasonable period of
time having regard to the nature and characteristics of such asset, as
reasonably determined by the Board of Directors of Borrower, or, if such asset
shall have been the subject of a relatively contemporaneous appraisal by an
independent third party appraiser, the basic assumptions underlying which have
not materially changed since its date, the value set forth in such appraisal,
and (b) with respect to any marketable Security at any date, the closing sale
price of such Security on the Business Day next preceding such date, as
appearing in any published list of any national securities exchange or the
Nasdaq Stock Market or, if there is no such closing sale price of such Security,
the final price for the purchase of such Security at face value quoted on such
business day by a financial institution of recognized standing which regularly
deals in securities of such type selected by Lender.

     

    “Future Facility” means a
credit or other financing facility (other than the facility governed by this
Agreement) provided by Lender to Borrower after the Effective Date.

     

    “GAAP” means generally
accepted accounting principles in the United States of America as in effect from
time to time set forth in the opinions and pronouncements of the Accounting
Principles Board and the American Institute of Certified Public Accountants and
the statements and pronouncements of the Financial Accounting Standards Board,
or in such other statements by such other entity as may be in general use by
significant segments of the accounting profession, which are applicable to the
circumstances as of the date of determination.

     

    “General Intangible” has the
meaning specified in the UCC.

     

    “Governmental Authority” means
any nation or government, any state or other political subdivision thereof and
any entity exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government.

     

    “Guaranty Obligation” means,
as applied to any Person, any direct or indirect liability, contingent or
otherwise, of such Person with respect to any Indebtedness of another Person, if
the purpose or intent of such Person in incurring the Guaranty Obligation is to
provide assurance to the obligee of such Indebtedness that such Indebtedness
will be paid or discharged, or that any agreement relating thereto will be
complied with, or that any holder of such Indebtedness will be protected (in
whole or in part) against loss in respect thereof including, (a) the direct or
indirect guaranty, endorsement (other than for collection or deposit in the
ordinary course of business), co-making, discounting with recourse or sale with
recourse by such Person of Indebtedness of another Person and (b) any liability
of such Person for Indebtedness of another Person through any agreement
(contingent or otherwise) (i) to purchase, repurchase or otherwise acquire such
Indebtedness or any security therefore, or to provide funds for the payment or
discharge of such Indebtedness (whether in the form of a loan, advance, stock
purchase, capital contribution or otherwise), (ii) to maintain the solvency or
any balance sheet item, level of income or financial condition of another
Person, (iii) to make take-or-pay or similar payments, if required, regardless
of non-performance by any other party or parties to an agreement, (iv) to
purchase, sell or lease (as lessor or lessee) property, or to purchase or sell
services, primarily for the purpose of enabling the debtor to make payment of
such Indebtedness or to assure the holder of such Indebtedness against loss, or
(v) to supply funds to or in any other manner invest in such other Person
(including to pay for property or services irrespective of whether such property
is received or such services are

     

    


    
      
        
           


        

        
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    rendered),
if in the case of any agreement described under subclause (i), (ii), (iii), (iv)
or (v) of clause (b) of this sentence the primary purpose or intent thereof is
as described in the preceding sentence.  The amount of any Guaranty
Obligation shall be equal to the amount of the Indebtedness so guaranteed or
otherwise supported.

     

    “Indebtedness” of any Person
means without duplication (a) all indebtedness of such Person for borrowed
money,  (b) all obligations of such Person evidenced by notes, bonds,
debentures or similar instruments or which bear interest, (c) all reimbursement
obligations and other obligations with respect to letters of credit, bankers’
acceptances, surety bonds and performance bonds, whether or not matured, (d) all
indebtedness for the deferred purchase price of property or services, other than
trade payables and accrued expenses incurred in the ordinary course of business
which are not overdue, (e) all indebtedness of such Person created or arising
under any conditional sale or other title retention agreement with respect to
property acquired by such Person (even though the rights and remedies of the
seller or lender under such agreement in the event of default are limited to
repossession or sale of such property), (f) all Capital Lease Obligations of
such Person, (g) all Guaranty Obligations of such Person, (h) all obligations of
such Person to purchase, redeem, retire, defease or otherwise acquire for value
any Stock or Stock Equivalents of such Person, valued, in the case of redeemable
preferred stock, at the greater of its voluntary or involuntary liquidation
preference plus accrued and unpaid dividends, and (i) all Indebtedness referred
to above secured by (or for which the holder of such Indebtedness has an
existing right, contingent or otherwise, to be secured by) any Lien upon or in
property (including Accounts and General Intangibles) owned by such Person, even
though such Person has not assumed or become liable for the payment of such
Indebtedness.

     

    “Indemnitees” has the meaning
specified in Section 10.3.

     

    “Indentures” means,
collectively, (a) the Indenture dated as of June 1, 1995 between Borrower and
Chemical Bank, as trustee, as amended, and (b) the Indenture dated as of August
1, 1992 between Union Carbide Plastics and Chemical Company, Inc., as issuer,
Carbide (as guarantor) and Chemical Bank, as trustee, as amended, in each case
as further amended from time to time.

     

    “Insurance Event” means any
event that results in the Borrower or its Subsidiaries receiving Net Cash
Proceeds of the type described in clause (b) of the definition of Net Cash
Proceeds.

     

    “Intercompany Indebtedness”
means Indebtedness owed by Borrower to one of its Subsidiaries or to Borrower by
one of its Subsidiaries.

     

    “Inventory” has the meaning
specified in the UCC.

     

    “Investment” means, with
respect to any Person, (a) any purchase or other acquisition by that Person of
(i) any Security issued by, (ii) a beneficial interest in any Security issued
by, or (iii) any other equity ownership interest in, any other Person, (b) any
purchase by that Person of all or a significant part of the assets of a business
conducted by another Person, (c) any loan, advance (other than prepaid expenses,
accounts receivable and similar items made or incurred in the ordinary course of
business as presently conducted), or capital contribution by that Person to any
other Person, including all Indebtedness to such Person arising from a sale of
property by such Person other than in the ordinary course of its business and
(d) any deposit with a financial institution.

     

    “Investment Property” has the
meaning specified in the Amended and Restated Pledge and Security
Agreement.

     

    “IRS” means the Internal
Revenue Service of the United States or any successor thereto.

     

    “Lender Set Off” has the
meaning specified in the preamble to this Agreement.

     

    “LIBOR” means, with respect to
any calculation of interest under Section 2.11(a), the
rate for deposits in U.S. Dollars for a period of one month which appears on the
Telerate page 3750 as of 11:00 a.m., London time, on the date that is two
Business Days prior to the first day of the applicable period for which such
interest is payable.

     

    “Lien” means any mortgage,
deed of trust, pledge, hypothecation, assignment, charge, deposit arrangement,
encumbrance, lien (statutory or other), security interest or preference,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever intended to assure payment of any Indebtedness or other
obligation, including any conditional sale or other title retention agreement,
the interest of a lessor under a Capital Lease, any financing lease having
substantially the same economic effect as any of the foregoing, and the filing
of any financing statement under the Uniform Commercial Code or comparable law
of any jurisdiction naming the owner of the asset to which such Lien relates as
debtor but excluding any right of set-off.

     

    


    
      
        
           


        

        
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    “Loan” means any loan made by
Lender under this Agreement, it being agreed that, except as provided in Section 2.4(f), (i) a
Credit Enhancement Obligation shall not be a Loan, and (ii) the Univation
Undertaking shall not be a Loan.

     

    “Loan Availability” means, as
of any time, the Commitment in effect at such time less the sum of (a) the
aggregate principal amount of Loans outstanding at such time, (b) the aggregate
amount of Credit Enhancement Obligations (other than Credit Enhancement
Obligations that have become Loans pursuant to Section 2.4(f)) outstanding as of
such time, and (c) the unused Univation Commitment.

     

    “Loan Documents” means,
collectively, this Agreement, any and all Notes, the Collateral Documents, any
and all Reimbursement Agreements (and any other agreements between Borrower and
Lender related to such Reimbursement Agreements), and each certificate,
agreement or document executed by Borrower and delivered to Lender in connection
with or pursuant to any of the foregoing.

     

    “Material Adverse Change”
means a material adverse change in any of (a) the business, condition (financial
or otherwise), operations, performance, prospects, assets, liabilities or
properties of Borrower and its Subsidiaries, taken as a whole, (b) the legality,
validity or enforceability of any Loan Document, (c) the perfection or priority
of the Liens granted pursuant to the Collateral Documents (except as expressly
permitted hereby or thereby), (d) the ability of Borrower to repay the
Obligations, or (e) the rights and remedies of Lender under the Loan
Documents.

     

    “Material Adverse Effect”
means an effect or circumstance that results in or causes, or could reasonably
be expected to result in or cause, a Material Adverse Change.

     

    “Monthly Report” means a
report prepared by Lender at the end of each calendar month setting forth as of
the relevant date (i) the aggregate amount of the Credit Enhancement Contingent
Obligations, (ii) the aggregate amount of all Loans outstanding; (iii) the
amount of the Deposited Cash Collateral, (iv) the Cash Collateralized Credit
Enhancements, and (v) upon the satisfaction of the conditions for the release of
the Step 2 Released Collateral pursuant to Section 2.3(ii) of the Amended and
Restated Pledge and Security Agreement, a statement to the effect that such
conditions have been met, all in form and substance reasonably satisfactory to
Lender.

     

    “Net Cash Proceeds” means (a)
proceeds received by Borrower or its Subsidiaries after March 25, 2003 in cash
or Cash Equivalents from any Asset Sale (other than Asset Sales permitted under
Section 8.3),
net of (x) the reasonable cash costs of sale, assignment or other disposition,
and (y) any amount required to be paid or prepaid on Indebtedness (other than
the Obligations) secured by the assets subject to such Asset Sale; provided, however, that the
evidence of each of (x) and (y) are provided to Lender in form and substance
satisfactory to it; (b) proceeds of insurance (other than proceeds in respect of
business interruption) covering property constituting Collateral (net of (i)
reasonable expenses incurred directly in the collection thereof and (ii) (to the
extent permitted hereby) contractually required payments of Indebtedness (other
than the Obligations) secured by a Lien on the insured property (that is prior
to any Lien granted under the Collateral Documents or is otherwise permitted by
this Agreement) on account of the loss of or damage to any such assets or
property, and payments of compensation for any such assets or property taken by
expropriation, condemnation or eminent domain, to the extent such proceeds or
payments exceed $100 million in the aggregate; and (c) proceeds received
after March 25, 2003 by Borrower or its Subsidiaries in cash or Cash Equivalents
from (i) any Equity Issuance, or (ii) any Debt Issuance (except for Indebtedness
permitted under clauses (a) through (f) of Section 8.1), in
each case net of brokers’ and advisors’ fees and other costs incurred in
connection with such transaction; provided, however, that
satisfactory evidence of such costs is provided to Lender.

     

    “Obligations” means all
advances, debts, liabilities, obligations, covenants and duties owing by
Borrower to Lender of every type and description, arising under this Agreement
or under any other Loan Document, including all fees and expenses and all
interest, charges, expenses, fees, attorneys’ fees and disbursements and other
sums chargeable to Borrower hereunder, whether direct or indirect, absolute or
contingent, or due or to become due.

     

    “Permit” means any permit,
approval, authorization, license, variance or permission required from a
Governmental Authority under an applicable Requirement of Law.

     

    “Person” means an individual,
partnership, corporation (including a business trust), joint stock company,
estate, trust, limited liability company, unincorporated association, joint
venture or other entity, or a Governmental Authority.

     

    “Reimbursement Agreement” has
the meaning specified in Section 2.4(e).

     

    “Reimbursement Obligations”
means, at any time with respect to any Credit Enhancement or the Univation
Reimbursement Obligation, all matured reimbursement or repayment obligations of
Borrower to Lender then owing under the

     

    


    
      
        
           


        

        
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    Reimbursement
Agreement or the Univation Reimbursement Agreement relating to such Credit
Enhancement or the Univation Undertaking, as applicable, as a result of Lender
having advanced funds  to the beneficiary of such Credit Enhancement,
or in the case of the Univation Undertaking, advanced funds or provided services
or other items of value.

     

    “Remaining Contingent
Liabilities” has the meaning specified in Section
7.9(a).

     

    “Reorganization Agreement”
means the Univation Reorganization Agreement dated as of December 4, 2000, among
Exxon Chemical Licensing Company, ExxonMobil Chemical Company, Lender, Borrower,
Union Carbide Subsidiary C, Inc. and Univation Technologies, LLC.

     

    “Requirement of Law” means,
with respect to any Person, all federal, provincial, state, local and foreign
laws, rules and regulations, orders, judgments, decrees and other determinations
of any Governmental Authority or arbitrator, applicable to or binding upon such
Person or any of its property or to which such Person or any of its property is
subject.

     

    “Responsible Officer” means,
with respect to any Person, any of the principal executive officers, managing
members or general partners of such Person, but in any event, with respect to
financial matters, the chief financial officer, treasurer or controller of such
Person.

     

    “Scheduled Termination Date”
means May 28, 2005.

     

    “SEC Reports” has the meaning
specified in Section
4.3.

     

    “Security” means any Stock,
Stock Equivalent, voting trust certificate, bond, debenture, note or other
evidence of Indebtedness, whether secured, unsecured, convertible or
subordinated, or any certificate of interest, share or participation in, or any
temporary or interim certificate for the purchase or acquisition of, or any
right to subscribe to, purchase or acquire, any of the foregoing, but shall not
include any evidence of the Obligations.

     

    “Step 2 Released Collateral”
has the meaning specified in the Amended and Restated Pledge and Security
Agreement.

     

    “Stock” means shares of
capital stock (whether denominated as common stock or preferred stock),
beneficial, partnership or membership interests, participations or other
equivalents (regardless of how designated) of or in a corporation, partnership,
limited liability company or equivalent entity, whether voting or
non-voting.

     

    “Stock Equivalents” means all
securities convertible into or exchangeable for Stock and all warrants, options
or other rights to purchase or subscribe for any Stock, whether or not presently
convertible, exchangeable or exercisable.

     

    “Subsidiary” means, with
respect to any Person, any affiliated entity that is controlled by such Person,
directly or indirectly, through one or more intermediaries, where “control”
means the possession, direct or indirect, of the power to direct or cause the
direction of the management and policies of such Person. For purposes hereof,
Borrower and its Subsidiaries shall not be deemed to be Subsidiaries of Lender
and Lender’s other Subsidiaries.

     

    “Subsidiary Guarantee” means
the Subsidiary Guarantee dated as of March 25, 2003, executed and delivered by
the Subsidiary Guarantors in favor of Lender, as amended from time to
time.

     

    “Subsidiary Guarantors” means,
collectively, the Subsidiaries of Borrower identified as Subsidiary Guarantors
on the signature pages hereto; provided, however, that UCMG
LLC and Catalysts, Adsorbents and Process Systems, Inc. will cease to be
Subsidiary Guarantors upon the release of the Step 2 Released
Collateral.

     

    “Termination Date” means the
earliest of (a) the Scheduled Termination Date, (b) 30 days following written
notice of termination from the Lender pursuant to Section 2.3(b),
(c) the date of termination of the Commitment by the Borrower pursuant to Section 2.3(a), and
(d) the date on which the Obligations become due and payable pursuant to Section 9.2.

     

    “UCC” has the meaning
specified in the Amended and Restated Pledge and Security
Agreement.

     

    “UCSC Loan Agreement” means,
the Loan Agreement, effective as of January 1, 2004, between the Lender and
Union Carbide Subsidiary C, Inc., a Delaware corporation and wholly owned
subsidiary of the Borrower.

     

    “Univation Commitment” has
the meaning specified in the UCSC Loan Agreement.

     

    


    
      
        
           


        

        
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    “Univation Reimbursement
Agreement” has the meaning specified in Section 2.4(e)(ii).

     

    “Univation Reimbursement
Obligation” has the meaning specified in Section 2.4(e)(ii).

     

    “Univation Undertaking”
means, the undertakings and agreements, whether financial or otherwise, made by
Lender in Article 2 of the Reorganization Agreement.

     

    Section
1.2.                      Computation of Time
Periods.  In
this Agreement, in the computation of periods of time from a specified date to a
later specified date, the word “from” means “from and including” and the words
“to” and “until” each mean “to but excluding” and the word “through” means “to
and including.”

     

    Section
1.3.                      Certain
Terms..

     

    (a)      The
words “herein,” “hereof,” “hereto” and “hereunder” and similar words
refer to this Agreement as a whole, and not to any particular Article, Section,
subsection or clause in, this Agreement.

     

    (b)      References
in this Agreement to an Exhibit, Schedule, Article, Section, subsection or
clause refer to the appropriate Exhibit or Schedule to, or Article, Section,
subsection or clause in this Agreement.

     

    (c)      References
in this Agreement to a Loan Document shall include all appendices, exhibits and
schedules thereto, and, unless specifically stated otherwise, all amendments,
restatements, supplements or other modifications thereto, and as the same may be
in effect at any and all times such reference becomes operative.

     

    (d)      References
in this Agreement to any statute shall be to such statute as amended or modified
and in effect at the time any such reference is operative.

     

    (e)      The
term “including” when
used in any Loan Document means “including without limitation” except when used
in the computation of time periods.

     

    (f)      The
terms “Lender” and
“Borrower” include
their respective successors.

     

     

    ARTICLE
II

    LOANS

     

    Section
2.1.                      Commitment.  On
the terms and subject to the conditions contained in this Agreement, Lender
agrees to make Loans to Borrower from time to time on any Business Day during
the period from the Effective Date until the Termination Date in an aggregate
amount not to exceed at any time outstanding the Commitment; provided, however, that at no
time shall Lender be obligated to make a Loan to Borrower to the extent that the
aggregate principal amount of Loans outstanding, after giving effect to such
Loan, would exceed the Loan Availability at such time. Within the limits of the
Commitment, amounts of Loans repaid may be reborrowed under this Section
2.1.

     

    Notwithstanding
the foregoing, if at any time the Lender is required to make a payment with
respect to the Univation Undertaking, the Commitment will be increased by the
amount of that payment, even if the Commitment has been otherwise terminated
under Section 2.3 hereof.  If the Commitment has been increased
pursuant to the foregoing and any repayment is made by the Borrower with respect
to the Univation Undertaking, the Commitment will be reduced by the amount of
such repayment but, subject to the Lender’s rights under Section 2.3, will not
be reduced below the original Commitment (it being understood that the
Commitment may be increased again in respect of subsequent payments required to
be made by Lender with respect to the Univation Undertaking).

     

    Section
2.2.                      Borrowing
Procedures.  Subject
to the terms and conditions set forth herein, each Loan shall be made in
accordance with the intercompany cash management program then in effect between
Borrower and Lender. Lender may, by written notice to Borrower, require Borrower
to deliver to Lender at least 10 days’ written notice (and no more than 20 days’
written notice) of any and all requested Loans or Credit Enhancements in excess
of $15,000,000 (whether in one Loan or Credit Enhancement or in a series of
related Loans or Credit Enhancements) that are to be used for payments to be
made to Persons other than Lender and its Affiliates.  Any such notice
shall state the purpose for such requested Loan or Credit Enhancement (and with
respect to any Credit Enhancement, any other information required to be provided
pursuant to

     

    


    
      
        
           


        

        
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    Section 2.4(c)
below).  In the event Lender elects not to make any of such Loans or
Credit Enhancements to Borrower, Lender agrees to give Borrower notice of such
election at least 5 days prior to the requested borrowing date.

     

    Section
2.3.                      Reduction and Termination of
Commitment.

     

    (a)      Borrower
or Lender may, upon written notice to the other party at any time terminate in
whole or reduce in part the unused portion of the Commitment.  Any
such termination or reduction in the Commitment shall be effective immediately
upon delivery of such notice, whereupon (i) in the case where the Commitment is
terminated, the obligation of Lender to make any Loan (including any Loan
request outstanding at such time) or provide any Credit Enhancement pursuant to
Section 2.4
shall immediately terminate, and (ii) in the case where the Commitment is
reduced, the obligation of Lender to make any Loan shall immediately be limited
to the amount of such reduced Commitment.

     

    (b)      In
the event of termination of the Commitment pursuant to Section 2.3(a),
Lender may, at any time and from time to time, demand payment from Borrower of
all or any part of the outstanding Loans together with all accrued and unpaid
interest thereon; provided that the repayment date shall be specified in
Lender’s notice and at least 30 days following Borrower’s receipt of written
notice from Lender.

     

    (c)      Upon
any mandatory prepayment of Loans required pursuant to Section 2.8(a) as the
result of an Asset Sale involving Collateral, the Commitment shall be
permanently reduced by an amount equal to the lesser of (i) 50% of the Net Cash
Proceeds received in such Asset Sale and (ii) the amount of the Commitment then
in effect.

     

    (d)      Upon
any mandatory prepayment of Loans required pursuant to Section 2.8(a) as the
result of an Insurance Event, the Commitment shall be permanently reduced by an
amount equal to the lesser of (i) 50% of the Net Cash Proceeds received as a
result of such Insurance Event and (ii) the amount of the Commitment then in
effect.

     

    Section
2.4.                      Credit
Enhancements.

     

    (a)      On
the terms and subject to the conditions contained in this Agreement, Lender
agrees to provide one or more Credit Enhancements at the request of Borrower
from time to time during the period commencing on the Effective Date and ending
on the earlier of the Termination Date and 30 days prior to the Scheduled
Termination Date; provided,
however, that Lender shall not be under any obligation to provide any
Credit Enhancement if:

     

    (i)      the
applicable conditions contained in Sections 3.1 and
3.2 are not
then satisfied;

     

    (ii)      after
giving effect to the issuance of such Credit Enhancement, the aggregate
principal amount of Loans outstanding would exceed the Loan
Availability;

     

    (iii)                 Lender,
in its sole discretion, is not satisfied with the relevant documentation
proposed to evidence such Credit Enhancement; or

     

    (iv)                 the
issuance of such Credit Enhancement shall have the effect of preventing the
occurrence of an Event of Default under Section 9.1(g) or
remedying any such Event of Default.

     

    (b)      In
no event shall the term of any Credit Enhancement be more than one year after
the date of issuance thereof; provided, however, that any
Credit Enhancement with a one-year term may provide for the renewal thereof for
additional one-year periods.

     

    (c)      In
connection with the provision of each Credit Enhancement, Borrower shall give
the Lender at least 10 days’ prior written notice (a “Credit Enhancement Request”),
in such written or electronic form as is acceptable to Lender, of the requested
Credit Enhancement.  Such notice shall describe in reasonable detail
the purposes of such Credit Enhancement, the nature and amount of the underlying
obligation, the proposed effective date of such requested Credit Enhancement
(which day shall be a Business Day), the date on which such Credit Enhancement
is to expire (which date shall be a Business Day), and the Person for whose
benefit the requested Credit Enhancement is to be provided.

     

     

     

    


    
      
        
           


        

        
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    (d)     
Subject to Section
2.2 and the satisfaction of the conditions set forth in this Section 2.4,
Lender shall, on the requested date, provide a Credit Enhancement on behalf of
Borrower.

     

    (e)      (i)
Prior to the issuance of any Credit Enhancement by Lender, and as a condition of
such issuance, Borrower shall have delivered to Lender a reimbursement
agreement, in such form as Lender may require (each a “Reimbursement Agreement”),
signed by Borrower, and such other documents or items as may be required
pursuant to the terms thereof.  In the event of any conflict between
the terms of any Reimbursement Agreement and this Agreement, the terms of this
Agreement shall govern.

     

    (ii)
In addition to the Reimbursement Agreements contemplated by Section 2.4(e)(i),
Borrower and Lender are parties to a Reimbursement Agreement effective as of
January 1, 2004 (the “Univation Reimbursement
Agreement”) pursuant to which Borrower has a reimbursement obligation
(the “Univation Reimbursement
Obligation”) for any funds, services or other goods provided to Exxon
Chemical Licensing Company, ExxonMobil Chemical Company, Union Carbide
Subsidiary C, Inc. or Univation Technologies, LLC pursuant to the Univation
Undertaking.  Notwithstanding the terms of the Univation Reimbursement
Agreement, the Univation Undertaking shall not be treated as a Credit
Enhancement under this Agreement, including, without limitation, for the
purposes of Section 2.10 (Fees).

     

    (f)      At
such time as Lender is required to advance funds, services, or other items of
value pursuant to any Credit Enhancement or the Univation Undertaking, such
Credit Enhancement or used portion of the Univation Undertaking shall become a
Reimbursement Obligation, and Borrower agrees to pay to Lender the amount of all
Reimbursement Obligations on demand with interest thereon, irrespective of any
claim, set-off, defense or other right which such Borrower may have at any time
against Lender or any other Person.  In the event that Lender makes
any payment under any Credit Enhancement or the Univation Undertaking and
Borrower shall not have repaid such amount to Lender pursuant to this clause (f)
or such payment is rescinded or set aside for any reason, such Reimbursement
Obligation shall be payable on demand with interest thereon computed from the
date on which such Reimbursement Obligation arose to the date of repayment in
full at the rate of interest applicable to past due Loans during such period,
and then Lender shall, notwithstanding whether or not the conditions precedent
set forth in Section 3.2
shall have been satisfied (which conditions precedent Lender hereby irrevocably
waives), be deemed to have made a Loan to Borrower in the principal amount of
such unpaid Reimbursement Obligation.

     

    (g)      Borrower’s
obligation to pay each Reimbursement Obligation shall be absolute, unconditional
and irrevocable, and shall be performed strictly in accordance with the terms of
this Agreement, under any and all circumstances whatsoever, including the
occurrence of any Default or Event of Default, and irrespective of:

     

    (i)      any
lack of validity or enforceability of any Credit Enhancement or the Univation
Undertaking or any Loan Document, or any term or provision therein;

     

    (ii)      any
amendment or waiver of or any consent to or departure from all or any of the
provisions of any Credit Enhancement or the Univation Undertaking or any Loan
Document (provided,
that any such amendment shall have been approved in writing by Borrower if the
effect of such amendment would have resulted in an increase in Borrower’s
applicable Credit Enhancement Obligations);

     

    (iii)     
the existence of any claim, right of set-off, defense or other right that
Borrower or any of its Subsidiaries or other party guaranteeing, or otherwise
obligated with, Borrower, any Subsidiary or other Affiliate thereof or any other
Person may at any time have against the beneficiary under any Credit Enhancement
or the Univation Undertaking, Lender or any other Person, whether in connection
with this Agreement, any other Loan Document or any other related or unrelated
agreement or transaction;

     

    (iv)      any
document presented under a Credit Enhancement or the Univation Undertaking
proving to be forged, fraudulent, invalid or insufficient in any respect or any
statement therein being untrue or inaccurate in any respect;

     

     

     

    


    
      
        
           


        

        
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    (v)     
 payment by Lender under a Credit Enhancement or the Univation Undertaking
against presentation of a document that does not comply with the terms of such
Credit Enhancement or the Univation Undertaking; and

     

    (vi)      any
other act or omission to act or delay of any kind of Lender or any other Person
or any other event or circumstance whatsoever, whether or not similar to any of
the foregoing, that might, but for the provisions of this Section, constitute a
legal or equitable discharge of Borrower’s obligations hereunder.

     

    Any
action taken or omitted to be taken by Lender under or in connection with any
Credit Enhancement or the Univation Undertaking shall not form the basis of any
resulting liability of Lender to Borrower.  In determining whether
documents presented under a Credit Enhancement or the Univation Undertaking
comply with the terms thereof, Lender may accept documents that appear on their
face to be in order, without responsibility for further investigation,
regardless of any notice or information to the contrary and, in making any
payment under any Credit Enhancement or the Univation Undertaking, Lender may
rely exclusively on the documents presented to it under such Credit Enhancement
or the Univation Undertaking as to any and all matters set forth therein,
including reliance on the amount therein requested to be paid under such Credit
Enhancement or the Univation Undertaking, whether or not the amount due to the
beneficiary thereunder equals such amount and whether or not any document
presented pursuant to such Credit Enhancement or the Univation Undertaking
proves to be insufficient in any respect, if such document on its face appears
to be in order.

     

    Section
2.5.                      Repayment of
Loans.  Borrower
shall repay the entire unpaid principal amount of the Loans on the Termination
Date or on such earlier date that the Loans become due and payable
hereunder.

     

    Section
2.6.                      Evidence of Debt,
Obligations of Borrower.

     

    (a)      Lender
shall maintain in accordance with its usual practice an account or accounts
evidencing Indebtedness of Borrower to Lender resulting from each Loan by Lender
from time to time under this Agreement, including the amounts of principal and
interest payable and paid to Lender from time to time under this
Agreement.  The entries made in any such account or accounts shall, to
the extent permitted by applicable law, be prima facie evidence of the existence
and amounts of the obligations recorded therein absent manifest error; provided, however, that the
failure of Lender to maintain such accounts or any error therein shall not in
any manner affect the obligations of the Borrowers to repay the Loans in
accordance with their terms.

     

    (b)      Notwithstanding
any other provision of this Agreement, in the event that Lender requests that
Borrower execute and deliver a promissory note or notes payable to Lender in
order to evidence the Indebtedness owing to Lender by Borrower hereunder,
Borrower will promptly execute and deliver a note or notes to Lender evidencing
any Loans of Lender, substantially in the form of Exhibit B.

     

    Section
2.7.                      Optional
Prepayments.  Borrower
may (in addition to the obligations under Section 2.8),
prepay the outstanding principal amount of the Loans at any time in whole or in
part without prepayment premium or penalty.

     

    Section
2.8.                      Mandatory
Prepayments.

     

    (a)      Upon
receipt by Borrower or any of its Subsidiaries of Net Cash Proceeds arising from
an Asset Sale (other than Asset Sales permitted by Section 8.3),
Equity Issuance, Debt Issuance or Insurance Event, Borrower shall immediately
prepay its Loans such that the aggregate amount of all such payments is equal to
100% of such Net Cash Proceeds.  Any such mandatory prepayment shall
be applied in accordance with Section 2.11(c)
below.

     

    (b)      If
at any time the aggregate principal amount of Loans exceeds the Commitment then,
at such time Borrower shall prepay its Loans then outstanding such that the
aggregate amount of all such payments is equal to such excess.  Any
such mandatory prepayment shall be applied in accordance with Section 2.11(c)
below.

     

    (c)      Borrower
agrees that all available funds in an Approved Deposit Account of Borrower shall
be applied on a daily basis in accordance with Section 2.11(c).  If
there are no Loans outstanding and no other Obligations are then due and
payable, then the funds in such Approved Deposit Account shall be retained in
such Approved Deposit Account.

     

     

     

    


    
      
        
           


        

        
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    Section 2.9.                      Interest.

     

    (a)      Rate of
Interest.  All Loans and the outstanding amount of all other
Obligations shall bear interest at the Applicable Rate as in effect from time to
time, (i) in the case of Loans, on the unpaid principal amount thereof from the
date such Loans are made and (ii) in the case of such other Obligations, from
the date such other Obligations are due and payable until, in all cases, paid in
full.

     

    (b)      Interest
Payments.  Interest accrued on each Loan shall be payable in
cash in arrears (i) on the twenty-fifth day of each calendar month, commencing
on April 25, 2003, and (ii) if not previously paid in full, at maturity (whether
by acceleration or otherwise) of such Loan.

     

    (c)      Default
Interest.  Notwithstanding the rates of interest specified in
Section 2.9(a)
or elsewhere herein, effective immediately upon the occurrence of an Event of
Default, and for as long thereafter as such Event of Default shall be
continuing, the principal balance of all Loans and the amount of all other
Obligations due and payable shall bear interest at a rate which is two percent
(2%) per annum in excess of the rate of interest applicable to such Obligations
from time to time.

     

    


     

    Section
2.9.                      Fees.

     

    (a)      Credit Enhancement
Fees.  With respect to each Credit Enhancement provided by
Lender hereunder, Borrower agrees to pay Lender a fee accruing at a rate per annum equal to two and
one-half percent (2.5%) of the maximum Credit Enhancement Contingent Liabilities
of Borrower to Lender outstanding from time to time under each such Credit
Enhancement, payable in arrears (A) on the first day of each calendar month
commencing on the first such day following the issuance of each such Credit
Enhancement and (B) on the Termination Date; provided, that the fee
accruing on the portion of the aggregate Credit Enhancements Contingent
Liabilities that is equal to the Deposited Cash Collateral shall be equal to one
and a quarter percent (1.25%),  provided, further, that
during the continuance of an Event of Default, all of such fees shall be
increased by two percent (2%) per annum and shall be payable on
demand.

     

    (b)      No Other
Fees.  Except as expressly provided in Section 2.10(a), no
fees of any kind will be paid by Borrower to Lender or any of Lender’s
Affiliates, pursuant to this Agreement or otherwise, as a result of the
financial accommodations provided by Lender under this Agreement or any other
Loan Document, including any unused commitment fees, closing fees, funding fees,
monitoring fees, documentation fees or other fees.

     

    (c)      Cash Collateralized Credit
Enhancements Rolled Into Future Facility. With respect to the closing of
any Future Facility, Lender agrees that it will not charge any commitment fee on
the portion of the commitment related to the Credit Enhancements that are rolled
into the Future Facility to the extent such Credit Enhancements are Cash
Collateralized Credit Enhancements, provided, however, that this clause (c) will
be effective only with respect to one Future Facility.

     

    Section
2.10.                      Payments and Computations;
Protective Advances.

     

    (a)      All
computations of interest and fees shall be made by Lender on the basis of a year
of 360 days, in each case for the actual number of days (including the first day
but excluding the last day) occurring in the period for which such interest and
fees are payable.  Each determination by Lender of an interest rate
hereunder shall be conclusive and binding for all purposes, absent manifest
error.

     

    (b)      Whenever
any payment hereunder shall be stated to be due on a day other than a Business
Day, such payment shall be made on the next succeeding Business Day, and such
extension of time shall in such case be included in the computation of payment
of interest or fees, as the case may be.

     

    (c)      Subject
to the provisions of Section 2.11(d)
and (except as otherwise provided in Section 2.8 or
2.9), all
payments and any other amounts received by Lender from or for the benefit of
Borrower shall be applied: first, to repay the
then outstanding principal amount of such Loans (including Reimbursement
Obligations that are deemed Loans in accordance with Section 2.4(f)) until all
Loans shall have been repaid in full; second, to any other
Obligations then due and

     

     

    


    
      
        
           


        

        
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    payable;
third, subject
to the discretion of Borrower as set forth in Section 7.9(a), to
provide cash collateral for all outstanding Credit Enhancement Obligations in
the manner set forth in Section 7.9(a)
until all such Credit Enhancement Obligations have been fully cash
collateralized in the manner set forth therein.

     

    (d)      After
the occurrence and during the continuance of an Event of Default, upon either
(A) the written direction of Lender or (B) the acceleration of the Obligations
pursuant to Section 9.2, all
payments in respect of any Obligations, all funds on deposit in any Approved
Deposit Account, all funds on deposit in the Cash Collateral Accounts and all
other proceeds of Collateral shall be applied in the following
order:

     

    (i)      first,
to pay Obligations in respect of any expense reimbursements or indemnities then
due to Lender;

     

    (ii)      second,
to pay Obligations in respect of any fees then due to the Lender under Section
2.10(a);

     

    (iii)                 third,
to pay interest then due and payable in respect of the Loans and Reimbursement
Obligations;

     

    (iv)                 fourth,
to pay or prepay principal payments on Loans and Reimbursement Obligations and
to provide cash collateral for outstanding Credit Enhancement Contingent
Liabilities in the manner described in Section 7.9(a);
and

     

    (v)      fifth,
to the ratable payment of all other Obligations.

     

    (e)      Notwithstanding
anything to the contrary set forth herein, all repayments of any Loans shall be
applied first to repay any portion of such Loans that is not secured by
Collateral under the Amended and Restated Pledge and Security Agreement and then
to repay the portion of such Loans that is secured by Collateral thereunder, it
being the parties’ intent that the portion of such Loans last remaining unpaid
shall be secured thereby.

     

     

    ARTICLE
III

    CONDITIONS
TO EFFECTIVENESS OF THIS AGREEMENT

     

    Section
3.1.                      Conditions Precedent to the
Effectiveness of this Agreement.  This
Agreement shall become effective on the date (the “Effective Date”) on which all
of the following conditions precedent have been first satisfied (unless waived
by Lender or the time for satisfaction thereof has been extended by Lender), it
being agreed by Borrower and Lender that the conditions precedent in this
Section 3.1 are deemed met as of the date of this Agreement:

     

    (a)      Certain
Documents.  Lender shall have received on the Effective Date
each of the following, each dated the Effective Date unless otherwise indicated
or agreed to by Lender, in form and substance satisfactory to
Lender:

     

    (i)      this
Agreement, duly executed and delivered by Borrower, Lender and each of the
Subsidiary Guarantors;

     

    (ii)      the
Amended and Restated Pledge and Security Agreement, duly executed and delivered
by Borrower and Lender;

     

    (iii)                 a
certificate of the Secretary or an Assistant Secretary of Borrower certifying
and attaching (A) the names and true signatures of each officer of Borrower
authorized to execute and deliver Loan Documents required hereunder to be
executed and delivered by or on behalf of Borrower, (B) the resolutions of
Borrower’s Board of Directors approving and authorizing the execution, delivery
and performance of this Agreement and the other Loan Documents and the
transactions contemplated by this Agreement, and (C) a copy of the Constituent
Documents of Borrower; and

     

    (iv)                 such
other certificates, documents, agreements and information respecting Borrower as
Lender may reasonably request.

     

    


    
      
        
           


        

        
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    (b)      Lender Set Off. Lender will
have exercised the Lender Set Off, and the proceeds of the Lender Set Off shall
have been deposited in a Cash Collateral Account in accordance with Section
7.9(a) and shall constitute Deposited Cash Collateral.

     

    (c)      Consents,
Etc.  Borrower shall have received all consents and
authorizations required pursuant to any material Contractual Obligation with any
other Person and shall have obtained all consents and authorizations of, and
effected all notices to and filings with, any Governmental Authority, in each
case, as may be necessary to allow Borrower lawfully (A) to execute, deliver and
perform, in all material respects, their respective obligations hereunder and
under the other Loan Documents, and (B) to create and perfect the Liens on the
Collateral to be owned by each of them in the manner and for the purpose
contemplated by the Loan Documents.

     

    Section
3.2.                      Conditions Precedent to Each
Loan and Credit
Enhancement.  The
obligation of Lender to make any Loan or provide any Credit Enhancement on any
date (including the Effective Date) is subject to the satisfaction of all of the
following conditions precedent (unless waived by Lender or the time for
satisfaction thereof has been extended by Lender):

     

    (a)      Credit Enhancement
Request.  With respect to any Credit Enhancement, Lender shall
have received a duly executed Credit Enhancement Request.

     

    (b)      Representations and
Warranties; No Defaults.  The following statements shall be
true on the date of such Loan or Credit Enhancement, both before and after
giving effect thereto and to the application of the proceeds from any such Loan
and to such Credit Enhancement:

     

    (i)      the
representations and warranties set forth in Article IV and
in the other Loan Documents shall have been true and correct on and as of the
Effective Date and shall be true and correct in all material respects on and as
of such date with the same effect as though made on and as of such date, except
to the extent such representations and warranties expressly relate to an earlier
date; and

     

    (ii)      no
Default or Event of Default has occurred and is continuing.

     

    (c)      No Material Adverse Change
or Effect.  Lender shall be satisfied that there shall have
occurred no Material Adverse Change or Material Adverse Effect since March 25,
2003.

     

    (d)      No Legal
Impediments.  The making of the Loan or Credit Enhancement on
such date does not violate any Requirement of Law on the date of such Loan or
Credit Enhancement and is not enjoined, temporarily, preliminarily or
permanently.

     

    The
acceptance by Borrower of the proceeds of each Loan made in accordance with
Section 2.2,
and each submission by Borrower of a Credit Enhancement Request and the issuance
of each Credit Enhancement requested therein, shall be deemed to constitute a
representation and warranty by Borrower as to the matters specified in Section 3.2(b)
on the date of the making of such Loan or Credit Enhancement.

     

     

    ARTICLE
IV

    REPRESENTATIONS
AND WARRANTIES

     

    To
induce Lender to enter into this Agreement, Borrower represents and warrants to
Lender that, on and as of the Effective Date, after giving effect to the making,
or the continuation, of the Loans on the Effective Date and on and as of each
date as required by Section 3.2(b)(i):

     

    Section
4.1.                      Corporate Existence;
Compliance with Law.  Borrower
(a) is duly organized, validly existing and in good standing under the laws of
the State of New York; (b) is duly qualified as a foreign corporation and in
good standing under the laws of the States of Connecticut, West Virginia,
Louisiana and Texas; (c) has all requisite power and authority and the legal
right to own, pledge, mortgage and operate its properties, to lease the property
it operates under lease and to conduct its business as now or currently proposed
to be conducted, except where the failure to do so would not in the aggregate
have a Material Adverse Effect; (d) is in compliance with its Constituent
Documents; (e) is in compliance with all applicable

     

    


    
      
        
           


        

        
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     Requirements
of Law except where the failure to be in compliance would not in the aggregate
have a Material Adverse Effect; and (f) has all necessary licenses, permits,
consents or approvals from or by, has made all necessary filings with, and has
given all necessary notices to, each Governmental Authority having jurisdiction,
to the extent required for the ownership, operation and conduct referred to in
clause (c) above, except for licenses, permits, consents, approvals or filings
which can be obtained or made by the taking of ministerial action to secure the
grant or transfer thereof or the failure to obtain or make would not in the
aggregate have a Material Adverse Effect.

     

    Section
4.2.                      Corporate Power;
Authorization; Enforceable Obligations.

     

    (a)      The
execution, delivery and performance by Borrower of the Loan Documents and the
consummation of the transactions contemplated thereby:

     

    (i)      are
within Borrower’s corporate, limited liability company, partnership or other
powers;

     

    (ii)      have
been duly authorized by all necessary corporate action, including the consent of
shareholders where required;

     

    (iii)     do
not and will not (A) contravene Borrower’s or any of its Subsidiaries’
respective Constituent Documents, (B) violate any other applicable Requirement
of Law applicable to Borrower, or any order or decree of any Governmental
Authority or arbitrator applicable to Borrower, (C) conflict with or result in
the breach of, or constitute a default under, or result in or permit the
termination or acceleration of, any material Contractual Obligation of Borrower
or any of its Subsidiaries, except where such conflict, breach, default,
termination or acceleration would not have a Material Adverse Effect, or (D)
result in the creation or imposition of any Lien upon any of the property of
Borrower or any of its Subsidiaries, other than those in favor of Lender
pursuant to the Collateral Documents; and

     

    (iv)     do
not require the consent of, authorization by, approval of, notice to, or filing
or registration with, any Governmental Authority or any other Person and, with
respect to the Collateral, filings required to perfect the Liens created by the
Collateral Documents.

     

    (b)      This
Agreement has been, and each of the other Loan Documents will have been upon
delivery thereof pursuant to the terms of this Agreement, duly executed and
delivered by Borrower.  This Agreement is, and the other Loan
Documents will be, when delivered hereunder, the legal, valid and binding
obligation of Borrower, enforceable against Borrower in accordance with its
terms.

     

    Section
4.3.                      Litigation.  Except
for litigation disclosed in any report, schedule, form or registration statement
filed by Borrower with the Securities and Exchange Commission (collectively, the
“SEC Reports”), there
are no pending or, to the knowledge of Borrower, threatened actions,
investigations or proceedings affecting Borrower or any of its Subsidiaries
before any court, Governmental Authority or arbitrator which would reasonably be
expected to be adversely determined and which, if adversely determined, would
have a Material Adverse Effect.  The performance of any action by
Borrower required or contemplated by any of the Loan Documents is not restrained
or enjoined (either temporarily, preliminarily or permanently).

     

    Section
4.4.                      No
Defaults.

     

    (a)      Neither
Borrower nor any of its Subsidiaries is in default under or with respect to any
Contractual Obligation owed by it and, to the knowledge of Borrower, no other
party is in default under or with respect to any Contractual Obligation owed to
Borrower or its Subsidiaries, other than, in either case, those defaults which
in the aggregate would not have a Material Adverse Effect.

     

    (b)      No
Default or Event of Default has occurred and is continuing.

     

    


    
      
        
           


        

        
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    Section
4.5.                      Use of Proceeds.  The
proceeds of the Loans are being used by Borrower and its Subsidiaries solely for
their respective businesses consistent with past custom and practice and arising
out of the Borrower and its Subsidiaries’ normal operation of their respective
businesses.

     

     

    ARTICLE
V

    [INTENTIONALLY
OMITTED]

     

     

    ARTICLE
VI

    REPORTING
COVENANTS

     

    As
long as any of the Obligations (in respect of Loans, interest or fees thereon
and expenses related thereto) or the Commitments remain outstanding, unless the
Lender otherwise consents in writing, Borrower agrees with Lender
that:

     

    Section
6.1.                      Default
Notices.  As
soon as practicable, and in any event within two Business Days after a
Responsible Officer of Borrower has actual knowledge of the existence of any
Default, Event of Default or other event which has had a Material Adverse Effect
or which has any reasonable likelihood of causing or resulting in a Material
Adverse Change, Borrower shall give Lender notice specifying the nature of such
Default or Event of Default or other event, including the anticipated effect
thereof, which notice, if given by telephone, shall be promptly confirmed in
writing on the next Business Day.

     

    Section
6.2.                      Asset
Sales.  Prior
to any Asset Sale (other than any Asset Sale permitted by Section 8.3),
Borrower shall send Lender a notice (a) describing such Asset Sale or the
nature and material terms and conditions of such transaction and
(b) stating the estimated Net Cash Proceeds anticipated to be received by
Borrower or any of its Subsidiaries, and (c) identifying the assets being sold
and whether they constitute Collateral.

     

    Section
6.3.                      Other
Information.  Borrower
will provide Lender with such other information respecting the business,
properties, condition, financial or otherwise, or operations of Borrower or any
of its Subsidiaries as Lender may from time to time reasonably
request.

     

    Section
6.4.                      Monthly
Report.  Within
10 days after the end of each calendar month, Lender will deliver a Monthly
Report with respect to such calendar month.

     

     

    ARTICLE
VII

    AFFIRMATIVE
COVENANTS

     

    As
long as any of the Obligations (in respect of Loans, interest or fees thereon
and expenses related thereto) or the Commitments remain outstanding, unless the
Lender otherwise consents in writing, Borrower agrees with Lender
that:

     

    Section
7.1.                      Preservation of Corporate
Existence, Etc.  Borrower
shall, and shall cause each of its Subsidiaries to, preserve and maintain its
corporate, partnership, limited liability company or other existence, rights
(charter and statutory) and franchises, except (i) as permitted by Sections 8.3 and
8.4 and (ii)
the abandonment of such existence, rights and franchises which are no longer
necessary or desirable to the conduct of the business of Borrower or its
Subsidiaries and (iii) as to which the abandonment of such existence, rights or
franchises would not in the aggregate have a Material Adverse
Effect.

     

    Section
7.2.                      Compliance with Laws,
Etc.  Borrower
shall, and shall cause each of its Subsidiaries to, comply with all applicable
Requirements of Law, Contractual Obligations and Permits (and maintain in full
force and effect all contracts constituting such Contractual Obligations and
such Permits), except where the failure so to comply would not in the aggregate
have a Material Adverse Effect.

     

    Section
7.3.                      Conduct of
Business.  Borrower
shall, and shall cause each of its Subsidiaries to, (a) conduct its business in
the ordinary course and substantially in accordance with past practice and (b)
use its reasonable efforts, in the ordinary course and substantially in
accordance with past practice, to preserve its business and the goodwill and
business of the customers, advertisers, suppliers and others having business
relations with Borrower or any of its Subsidiaries, except in

     

    


    
      
        
           


        

        
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    each
case where the failure to comply with the covenants in each of clauses (a) and
(b) above would not in the aggregate have a Material Adverse
Effect.

     

    Section
7.4.                      Access.  Borrower
shall from time to time, permit, and shall cause each of its Subsidiaries to
permit, Lender or any of its agents or representatives, within one Business Day
after written notification of the same (except that during the continuance of an
Event of Default, no such notice shall be required) to (a) examine and make
copies of and abstracts from the records and books of account of Borrower and
each of its Subsidiaries, (b) visit the properties of Borrower and each of its
Subsidiaries, (c) discuss the affairs, finances and accounts of Borrower and
each of its Subsidiaries with any of their respective officers or directors, and
(d) communicate directly with Borrower’s independent certified public
accountants; provided,
however, that Borrower may participate in such communication unless a
Default or Event of Default has occurred and is continuing.  Borrower
shall authorize its independent certified public accountants (and any of its
Subsidiaries’ accountants) to disclose to Lender any and all financial
statements and other information of any kind, as Lender reasonably requests from
Borrower or any of its Subsidiaries and which such accountants may have with
respect to the business, financial condition, results of operations or other
affairs of Borrower or any of its Subsidiaries.

     

    Section
7.5.                      Keeping of
Books.  Borrower
shall keep, and shall cause each of its Subsidiaries to keep, proper books of
record and account, in which full and correct entries shall be made in
conformity with GAAP of all financial transactions and the assets and business
of Borrower and each such Subsidiary.

     

    Section
7.6.                      Application of
Proceeds.  Without
the prior written consent of Lender, Borrower and its Subsidiaries shall use the
entire amount of the proceeds of the Loans as provided in Section 4.5.

     

    Section
7.7.                      Further
Assurances.  Promptly
upon the reasonable request by Lender, Borrower shall, and shall ensure that
each of its Subsidiaries shall, take such action as Lender may request
(including the execution, amendment, delivery, filing and registration of any
Loan Document or other document, certificate, agreement or instrument) in order
to correct any material defect or error which may be discovered which impairs,
or may fail to provide, the intended legality, effectiveness, accuracy,
perfection or priority of any Loan Document.

     

    Section
7.8.                      Approved Deposit Accounts
and Cash Management System.

     

    (a)      Borrower
and Lender agree to continue the intercompany cash management program in effect
as of the date of this Agreement. As soon as reasonably practicable, Borrower
shall ensure that bank accounts and cash management systems shall be implemented
and maintained as reasonably requested by Lender, including the establishment of
Cash Collateral Accounts and/or Approved Deposit Accounts.

     

    (b)      Lender
shall have a perfected first priority lien on the Approved Deposit
Accounts.  During the continuance of any Default or Event of Default,
as long as any of the Obligations or the Commitment remain outstanding, neither
Borrower nor any Person or entity claiming by, through or under Borrower shall
have any control over the use of, or any right to effect a withdrawal from, any
Approved Deposit Account.

     

    (c)      At
any time and from time to time, Lender may require Borrower and its Subsidiaries
to deposit all or any lesser portion of their cash into Approved Deposit
Accounts and, for purposes thereof (i) to create additional Approved Deposit
Accounts and/or (ii) promptly to convert all or any lesser portion of their Cash
Equivalents into cash.

     

    Section
7.9.                      Credit Enhancements and Cash
Collateral.

     

    (a)      On
a daily basis, Borrower agrees, at all times and from time to time following the
Effective Date and subject to Section 2.11(c), to deposit any cash, other
amounts and credit balances of Borrower, and Borrower hereby instructs Lender to
deposit cash, other amounts and credit balances of Borrower held by Lender, into
one or more Cash Collateral Accounts, until there is Deposited Cash Collateral
in an amount equal to the sum of (a) 105% of the sum of all outstanding Credit
Enhancement Obligations which are denominated in U.S. dollars, and (b) 125% of
the sum of all outstanding Credit Enhancement Obligations (if any) which are
denominated in currencies other than U.S. dollars; provided, that in its
discretion Borrower may at any time and from time to time elect not to deposit
(and may request Lender not to deposit) any cash, other amounts and credit
balances of Borrower in a Cash Collateral Account; provided, further, that such
request shall not

     

    


    
      
        
           


        

        
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    otherwise
alter the requirements of this Section 7.9(a) or the conditions to the release
of the Step 2 Released Collateral. Such Deposited Cash Collateral shall bear
interest for the benefit of Borrower at a rate per annum equal to LIBOR plus
0.125%, which interest shall be payable monthly and shall accrue regardless of
whether Lender has drawn, borrowed against or otherwise used all or part of such
Deposited Cash Collateral pursuant to Section 7.9(c).  Lender may (but
shall be under no obligation to) from time to time after the deposit of the
Deposited Cash Collateral, apply all or part of such Deposited Cash Collateral
then held to the payment of any amounts, in accordance with Section 2.11(c), as
shall have become or shall become due and payable by Borrower to
Lender.  Lender shall promptly give written notice of any such
application; provided, however, that the failure to give such written notice
shall not invalidate any such application. To the extent that Borrower has
Credit Enhancements that are not fully cash collateralized in accordance with
this Section 7.9(a) and elects not to deposit (or requests Lender not to
deposit) any cash, other amounts and credit balances of Borrower in a Cash
Collateral Account, such cash, other amounts and credit balances not deposited
in a Cash Collateral Account will be deposited in an Approved Deposit
Account.

     

    (b)      Following
the end of each calendar month following the Effective Date, Lender shall
determine the aggregate amount of the Credit Enhancement Obligations outstanding
at the end of such calendar month (the “Remaining Contingent
Liabilities”) and, if the Deposited Cash Collateral exceeds an amount
equal to the sum of (a) 105% of the sum of all Remaining Contingent Liabilities
which are denominated in U.S. dollars and (b) 125% of the sum of all Remaining
Contingent Liabilities (if any) which are denominated in currencies other than
U.S. dollars, Lender shall release such excess to Borrower within 30 days of the
end of such calendar month. Any determination of Remaining Contingent
Liabilities hereunder shall be conclusive and binding for all purposes, absent
manifest error. Except as provided in the foregoing sentence, neither Borrower
nor any Person claiming on behalf of or through Borrower, nor any Person other
than Lender, shall have any right to withdraw any portion of the Deposited Cash
Collateral at any time prior to the termination of all outstanding Credit
Enhancements.  Lender will deliver to Borrower the Deposited Cash
Collateral or any other cash collateral held by Lender (including any amounts
Lender has drawn, borrowed against or otherwise used) within 15 days after the
date in which all obligations of Lender with respect to any underlying Credit
Enhancement are released and not renewed by Lender and all Obligations related
thereto have been indefeasibly terminated.

     

    (c)      Borrower
and Lender hereby agree that, subject to the terms and conditions of this
Agreement, Lender shall be allowed in its discretion to draw, borrow against and
otherwise use and apply funds in any Cash Collateral Account (and any other cash
collateral provided by Borrower) for Lender’s purposes. With respect to the Cash
Collateralized Credit Enhancements, the sole security with respect to the face
value of the Cash Collateralized Credit Enhancements shall be the Deposited Cash
Collateral, and no other portion of the Collateral shall be available as
security in respect of the Cash Collateralized Credit Enhancements, provided
that the remaining Collateral shall continue to secure all other Obligations
relating to or associated with such Cash Collateralized Credit
Enhancements.

     

    (d)      Lender
shall have a perfected first priority lien on the Cash Collateral Account and on
all cash, other amounts therein and credit balances thereto.  As long
as any of the Obligations or the Commitment remain outstanding, neither Borrower
nor any Person or entity claiming by, through or under Borrower, nor any Person
other than Lender shall have any control over the use of, or any right to effect
a withdrawal from, the Cash Collateral Account. Lender shall at all times have
control, and be permitted to use, draw, close, and otherwise exclusively
administer and be the depositary bank’s customer (as defined in Section 4-104 of
the UCC) with respect to the Cash Collateral Account.

     

    (e)      Borrower
and Lender hereby acknowledge that upon the deposit of certain additional cash
collateral in a Cash Collateral Account pursuant to the terms and conditions of
the Amended and Restated Pledge and Security Agreement, the Step 2 Released
Collateral shall be released.

     

     

    ARTICLE
VIII

    NEGATIVE
COVENANTS

     

    As
long as any of the Obligations (in respect of Loans, interest or fees thereon
and expenses related thereto) or the Commitments remain outstanding, unless the
Lender otherwise consents in writing, Borrower agrees with Lender
that:

     

    Section
8.1.                      Indebtedness.  Borrower
will not, and will not permit any of its Subsidiaries to, directly or indirectly
create, incur, assume or otherwise become or remain directly or indirectly
liable with respect to any Indebtedness except:

     

    


    
      
        
           


        

        
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    (a)      the Obligations;

     

    (b)      Indebtedness
existing as of March 25, 2003;

     

    (c)      Capital
Lease Obligations and purchase money Indebtedness incurred by Borrower or its
Subsidiaries to finance the acquisition of real property or Equipment in an
aggregate outstanding principal amount not to exceed $20,000,000 at any
time;

     

    (d)      renewals,
extensions, refinancings and refundings of Indebtedness permitted by clause (b)
or (c) of this Section 8.1;
provided, however, that
any such renewal extension, refinancing or refunding is in an aggregate
principal amount not greater than the principal amount of, including as to
weighted average maturity, than the Indebtedness being renewed, extended,
refinanced or refunded;

     

    (e)      Indebtedness
arising under any performance or surety bond entered into in the ordinary course
of business;

     

    (f)      Intercompany
Indebtedness; and

     

    (g)      unsecured
Indebtedness not otherwise permitted under this Section 8.1 in
an aggregate outstanding principal amount not to exceed $20,000,000 at any
time.

     

    Section
8.2.                      Liens,
Etc.  Borrower
will not, and will not permit any of its Subsidiaries to, create or suffer to
exist, any Lien upon or with respect to any of its properties or assets, whether
now owned or hereafter acquired, or assign, or permit any of its Subsidiaries to
assign, any right to receive income, except for:

     

    (a)      Liens
created pursuant to the Loan Documents;

     

    (b)      Liens
existing on the date of this Agreement;

     

    (c)      Customary
Permitted Liens;

     

    (d)      purchase
money Liens granted by Borrower or any Subsidiary of Borrower (including the
interest of a lessor under a Capital Lease and Liens to which any property is
subject at the time of Borrower’s or such Subsidiary’s acquisition thereof)
securing Indebtedness permitted under Section 8.1(b),
(c) or (d) and limited in
each case to the property purchased with the proceeds of such purchase money
Indebtedness or subject to such Capital Lease;

     

    (e)      judgment
Liens to the extent the underlying judgment does not constitute an Event of
Default under Section 9.1(g);
and

     

    (f)      any
Lien securing the renewal, extension, refinancing or refunding of any
Indebtedness secured by any Lien permitted by clause (d) of this Section 8.2
without any change in the assets subject to such Lien.

     

    Section
8.3.                      Sale of
Assets.  Borrower
will not, and will not permit any of its Subsidiaries to, sell, convey,
transfer, lease or otherwise dispose of, any of its assets or any interest
therein (including the sale or factoring at maturity or collection of any
accounts) to any Person, or permit or suffer any other Person to acquire any
interest in any of its assets (any such disposition being an “Asset Sale”),
except:

     

    (a)      the
sale or disposition in the ordinary course of business of Inventory or Cash
Equivalents;

     

    (b)      the
sale or disposition of Equipment which has become obsolete or is replaced in the
ordinary course of business;

     

    (c)      the
lease or sublease of real property or personal property which does not
constitute a sale and leaseback;

     

    


    
      
        
           


        

        
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    (d)      assignments
and licenses of intellectual property of Borrower and its Subsidiaries in the
ordinary course of business;

     

    (e)      any
other Asset Sales (including any disposition of assets to a joint venture by
Borrower or its Subsidiaries) the aggregate Fair Market Value of which shall not
exceed $100,000,000; and

     

    (f)      additional
Asset Sales by Borrower and its Subsidiaries (other than in respect of (i)
property subject to Liens under the Collateral Documents and (ii) property
subject to Liens securing Indebtedness of Borrower or such Subsidiary) to
Borrower or any of its Subsidiaries.

     

    Section
8.4.                      Restrictions on Subsidiary
Distributions; No New Negative Pledge.  Other
than pursuant to the Loan Documents and any agreements governing any purchase
money Indebtedness or Capital Lease Obligations permitted by clause (b), (c), or
(d) of Section 8.1 (in
which latter case, any prohibition or limitation shall only be effective against
the assets financed thereby) or in connection with an Asset Sale which is
permitted under Section 8.3 (in
respect only of the assets subject thereto) or pursuant to customary
anti-assignment provisions contained in leases or licenses permitted under this
Agreement or as otherwise contained, at the date hereof, in the Indentures or in
or any other agreement by which the Borrower or any of its Subsidiaries is bound
that is in effect as of the Effective Date, Borrower will not, and will not
permit any of its Subsidiaries to, (a) agree to enter into or suffer to exist or
become effective any consensual encumbrance or restriction of any kind on the
ability of such Subsidiary to pay dividends or make any other distribution or
transfer of funds or assets or make loans or advances to or other Investments
in, or pay any Indebtedness owed to, Borrower or any other Subsidiary of
Borrower or (b) enter into or suffer to exist or become effective any agreement
which prohibits or limits the ability of Borrower or any Subsidiary to create,
incur, assume or suffer to exist any Lien upon any of its property, assets or
revenues, whether now owned or hereafter acquired, to secure the Obligations,
including any agreement which requires other Indebtedness or Contractual
Obligations to be equally and ratably secured with the Obligations.

     

    Section
8.5.                      Payment of Junior
Indebtedness.  Borrower
will not, and will not permit any of its Subsidiaries to, purchase, redeem,
retire or otherwise acquire for value, or set apart any money for a sinking,
defeasance or other analogous fund for the purchase, redemption, retirement or
other acquisition of, or make any voluntary payment or prepayment of the
principal of or interest on, or any other amount owing in respect of
Indebtedness of the Borrower or its Subsidiaries, except for regularly scheduled
principal or interest payments owing with respect to Indebtedness permitted
under Section 8.1(a),
(b), (d), (f) or (g) or payments owing
in respect of Capital Lease Obligations permitted under Section
8.1.

     

     

    ARTICLE
IX

    EVENTS
OF DEFAULT

     

    Section
9.1.                      Events of
Default.  Each
of the following events shall be an Event of Default:

     

    (a)      Borrower
shall fail to pay any principal of any Loan when the same becomes due and
payable; or

     

    (b)      Borrower
shall fail to pay any interest on any Loan, any fee under any of the Loan
Documents or any other Obligation  (other than one referred to in
clause (a) above) and such non-payment continues for a period of five Business
Days after the due date therefore; or

     

    (c)      any
representation or warranty made or deemed made by Borrower in any Loan Document
or by Borrower (or any of its officers) in connection with any Loan Document
shall prove to have been incorrect in any material respect when made or deemed
made; or

     

    (d)      Borrower
shall fail to perform or observe any term, covenant or agreement contained in
this Agreement or in any other Loan Document (other than the payment obligations
referred to in clauses (a) and (b) above) if such failure shall remain
unremedied for 30 days after the earlier of the date on which (A) a Responsible
Officer of Borrower becomes aware of such failure or (B) written notice thereof
shall have been given to Borrower by Lender; or

     

    (e)      (i)
Borrower or any of its Subsidiaries shall fail to make any payment on any
Indebtedness (other than the Obligations) of Borrower or any such Subsidiary (or
any Guaranty Obligation in respect of Indebtedness of any other 

     

    
      
        
           


        

        
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    Person)
having a principal amount of $12,500,000 or more, when the same
becomes due and payable (whether by scheduled maturity, required prepayment,
acceleration, demand or otherwise); or (ii) any other event shall occur or
condition shall exist under any agreement or instrument relating to any such
Indebtedness, if the effect of such event or condition is to accelerate, or to
permit the acceleration of, the maturity of such Indebtedness; or (iii) any such
Indebtedness shall become or be declared to be due and payable, or required to
be prepaid or repurchased (other than by a regularly scheduled required
prepayment), prior to the stated maturity thereof; or

     

    (f)      Borrower
or any of its Subsidiaries shall generally not pay its debts as such debts
become due, or shall admit in writing its inability to pay its debts generally,
or shall make a general assignment for the benefit of creditors, or any
proceeding shall be instituted by or against Borrower or any of its Subsidiaries
seeking to adjudicate it a bankrupt or insolvent, or seeking liquidation,
winding up, reorganization, arrangement, adjustment, protection, relief or
composition of it or its debts or any similar relief under any law relating to
bankruptcy, insolvency or reorganization or relief of debtors, or seeking the
entry of an order for relief or the appointment of a custodian, receiver,
trustee, administrative receiver, liquidator, provisional liquidator,
administrator, custodian or other similar official for it or for any substantial
part of its property and, in the case of any such proceedings instituted against
Borrower or any of its Subsidiaries (but not instituted by it), either such
proceedings shall remain undismissed or unstayed for a period of 30 days or any
of the actions sought in such proceedings shall occur; or Borrower or any of its
Subsidiaries shall authorize any of the actions set forth above in this
subsection (f); or

     

    (g)      one
or more judgments or orders (or other similar process) involving, in any single
case or in the aggregate, an amount in excess of $50,000,000 (in the case of a money
judgment), or which would have a Material Adverse Effect (in the case of a
non-money judgment) to the extent not covered by insurance, bonded or otherwise
fully provided for, shall be rendered against one or more of Borrower and its
Subsidiaries and shall remain unpaid and either (i) enforcement proceedings
shall have been commenced and be continuing by any creditor upon such judgment
or order or (ii) there shall be any period of 30 consecutive days during which a
stay of enforcement of such judgment or order, by reason of a pending appeal or
otherwise, shall not be in effect (unless during such period such judgment or
order shall have been vacated, satisfied, discharged or bonded pending appeal);
or

     

    (h)      any
material provision (as determined by Lender) of any Collateral Document after
delivery thereof pursuant to this Agreement or any other Loan Document shall for
any reason cease to be valid and binding on, or enforceable against, Borrower or
Borrower shall so state in writing; or

     

    (i)      after
a valid Lien has been created on any Collateral, any Collateral Document shall
for any reason cease to create a valid Lien on any of the Collateral purported
to be covered thereby or, except as permitted by the Loan Documents, such Lien
shall cease to be a perfected and first priority Lien or Borrower shall so state
in writing; or

     

    (j)      any
Change of Control.

     

    Section
9.2.                      Remedies.

     

    (a)      During
the continuance of any Event of Default other than an Event of Default of the
type described in Section 9.1(f) or
(j), Lender may
by notice to Borrower declare the Loans, all interest thereon and all other
amounts and Obligations payable under this Agreement to be forthwith due and
payable, whereupon the Loans, all such interest and all such amounts and
Obligations shall become and be forthwith due and payable, without presentment,
demand, protest or further notice of any kind, all of which are hereby expressly
waived by Borrower.

     

    (b)      During
the continuance of any Event of Default of the type described in Section 9.1(f) or
(j), all Loans,
all interest thereon and all other amounts and Obligations payable under this
Agreement shall automatically be due and payable without action of the Lender,
without presentment, demand, protest or notice of any kind, all of which are
hereby expressly waived by Borrower.

     

    (c)      In
addition to the remedies set forth above, Lender may exercise any remedies
provided for by the Collateral Documents in accordance with the terms thereof or
any other remedies provided by applicable law.

     

    
      
        
           


        

        
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    ARTICLE
X

    MISCELLANEOUS

     

    Section
10.1.                      Amendment, Waivers,
Etc.  No
amendment, waiver or consent shall, unless in writing and signed by the party
against whom enforcement is sought, affect the rights or obligation of such
party under this Agreement or the other Loan Documents.

     

    Section
10.2.                      Expenses.

     

    (a)      Borrower
agrees upon demand to pay, or reimburse the Lender for, all of Lender’s
reasonable expenses of every type and nature (other than fees and expenses of
legal counsel) reasonably incurred by Lender in connection with (i) the
preparation, negotiation and execution of the Loan Documents, (ii) the
interpretation of this Agreement (including, without limitation, the
satisfaction or attempted satisfaction of any of the conditions set forth in
Article III), the Loan Documents and any Credit Enhancement and the making
of the Loans or Credit Enhancements hereunder; (iii) the creation, perfection or
protection of the Liens under the Loan Documents; (iv) the ongoing
administration of this Agreement, the Loans and the Credit Enhancements; (v) the
protection, collection or enforcement of any of the Obligations or the
enforcement of any of the Loan Documents; (vi) the commencement, defense or
intervention in any court proceeding relating in any way to the Obligations,
Borrower, this Agreement or any of the other Loan Documents; (vii) the response
to, and preparation for, any subpoena or request for document production with
which Lender is served or deposition or other proceeding in which Lender is
called to testify, in each case, relating in any way to the Obligations,
Borrower, this Agreement or any of the other Loan Documents; and (viii) any
amendments, consents, waivers, assignments, restatements, or supplements to any
of the Loan Documents and the preparation, negotiation, and execution of the
same.

     

    (b)      Borrower
further agrees to pay, or reimburse the Lender for, all of Lender’s reasonable
expenses of every type and nature (other than fees and expenses of legal
counsel) reasonably incurred by Lender in connection with (i) enforcing any Loan
Document or Obligation or any security therefore or exercising or enforcing any
other right or remedy available by reason of an Event of Default; (ii)
refinancing or restructuring the credit arrangements provided hereunder in the
nature of a “work-out” or in any insolvency or bankruptcy proceeding; (iii)
commencing, defending or intervening in any litigation or in filing a petition,
complaint, answer, motion or other pleadings in any legal proceeding relating to
the Obligations or Borrower and related to or arising out of the transactions
contemplated hereby or by any of the other Loan Documents; and (iv) taking any
other action in or with respect to any suit or proceeding (bankruptcy or
otherwise) described in clauses (i) through (iii) above.

     

    Section
10.3.                      Indemnities.

     

    (a)      Borrower
agrees to indemnify and hold harmless Lender and each of its directors,
officers, employees, agents, representatives, attorneys, consultants and
advisors of or to any of the foregoing (each such Person being an “Indemnitee”) from and against
any and all claims, damages, liabilities, obligations, losses, penalties,
actions, judgments, suits, costs, disbursements and expenses of any kind or
nature (including reasonable fees and disbursements of counsel to any such
Indemnitee, but excluding taxes imposed on or measured by the Indemnitee’s net
income and franchise taxes, imposed on it, by the jurisdiction (or any political
subdivision thereof) under the laws of which such Indemnitee is organized or in
which its principal office is located) which may be imposed on, incurred by or
asserted against any such Indemnitee in connection with or arising out of any
investigation, litigation or proceeding, whether or not any such Indemnitee is a
party thereto, whether direct, indirect, or consequential and whether based on
any federal, state or local law or other statutory regulation, securities or
commercial law or regulation, or under common law or in equity, or in contract,
tort or otherwise, relating to or arising out of this Agreement, any other Loan
Document, any Obligation, any Credit Enhancement or any act, event or
transaction related or attendant to any thereof, or the use or intended use of
the proceeds of the Loans or in connection with any investigation of any
potential matter covered hereby (collectively, the “Indemnified
Matters”).

     

    (b)      Borrower
agrees that any indemnification or other protection provided to any Indemnitee
pursuant to this Agreement or any other Loan Document shall (i) survive payment
in full of the Obligations and (ii) inure to the benefit of any Person who was
at any time an Indemnitee under this Agreement or any other Loan
Document.

     

    
      
        
           


        

        
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    Section
10.4.                      Limitation of
Liability.  Borrower
agrees that no Indemnitee shall have any liability (whether direct or indirect,
in contract, tort or otherwise) to Borrower or any of its Subsidiaries or any of
their present or future equity holders or creditors for or in connection with
the transactions contemplated hereby and in the other Loan
Documents.

     

    Section
10.5.                      Right of
Set-off.  Lender
is hereby authorized at any time and from time to time, to the fullest extent
permitted by law, to set off and apply any and all funds at any time held by and
other indebtedness or other amounts at any time owing by Lender or its
Affiliates to or for the credit or the account of Borrower or any Subsidiary of
Borrower against any and all of the Obligations and any other indebtedness or
other amounts at any time owing by Borrower or any Subsidiary of Borrower as a
result of any other transaction, now or hereafter existing, whether or not
Lender or its Affiliates shall have made any demand under this Agreement, any
other Loan Document, or any other agreement or contract, and although such
Obligations, indebtedness or other amounts or obligations may be unmatured.
Lender agrees promptly to notify Borrower (and, if applicable, such Subsidiary
of Borrower) after any such set-off and application is made by Lender; provided,
however, that the failure to give such notice shall not affect the validity of
such set-off and application.  The rights of Lender under this Section
10.5 are in addition to the other rights and remedies (including other rights of
set-off under Section 2.10 (a) of the Amended and Restated Revolving Loan
Agreement between Borrower (as lender) and Lender  (as borrower)
effective as of January 1, 2004, and any other rights of set-off) which Lender
may have.  In the event any amount is set-off against any unmatured
Credit Enhancement Obligation, the amount set-off against such unmatured Credit
Enhancement Obligation shall be used to cash collateralize such Credit
Enhancement Obligation in accordance with Section 7.9(a).

     

    Section
10.6.                      Notices,
Etc.  All
notices, demands, requests and other communications provided for in this
Agreement shall be given in writing and addressed to the party to be notified as
follows:

     

    (a)      if
to Borrower:

     

    Union Carbide Corporation

    400 West Sam Houston Parkway
South

    Houston, Texas 77042

    Attention: Treasurer

    


    with copies (which shall not
constitute notice to Borrower) to:

    


    Union Carbide Corporation

    400 West Sam Houston Parkway
South

    Houston, Texas 77042

    Attention: General
Counsel

    


    and

    


    Cleary, Gottlieb, Steen &
Hamilton

    One Liberty Plaza

    New York, New York 10006

    Attention: Yvette P. Teofan,
Esq.

    


    (b)      if
to Lender, to:

     

    The Dow Chemical Company

    2030 Dow Center

    Midland, Michigan 48674

    Attention: Treasurer

    


    with copies (which shall not
constitute notice to Lender) to:

    


    The Dow Chemical Company

     

    
      
        
           


        

        
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    2030 Dow Center

    Midland,
Michigan  48674

    Attention: Manager of Financial
Law

    


    and

    


    Kirkland & Ellis
LLP

    153 East 53rd
Street

    Citigroup Center

    New York, New York 10022

    Attention: Kimberly P. Taylor,
Esq.

    


    or
at such other address as shall be notified in writing to Borrower and
Lender.  All such notices and communications shall be effective upon
personal delivery (if delivered by hand, including any overnight courier
service), or when deposited in the mails (if sent by mail); provided, however, that
notices and communications to Lender pursuant to Article II or
IX shall not be
effective until received by Lender.

     

    Section
10.7.                      No Waiver;
Remedies.  No
failure on the part of Lender to exercise, and no delay in exercising, any right
hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise of any such right preclude any other or further exercise thereof or the
exercise of any other right.  The remedies herein provided are
cumulative and not exclusive of any remedies provided by law.

     

    Section
10.8.                      Binding
Effect.  This
Agreement shall become effective on the Effective Date and thereafter this
Agreement shall be binding upon and inure to the benefit of Borrower and Lender
and their respective successors and assigns, except that Borrower shall not have
the right to assign its rights hereunder or any interest herein without the
prior written consent of Lender.

     

    Section
10.9.                      Reaffirmation.  The
Subsidiary Guarantors hereby acknowledge and agree that, except as expressly
amended and restated hereby, all Loan Documents remain in full force and effect
in accordance with their terms, and the execution, delivery and effectiveness of
this Agreement shall not, except as otherwise expressly provided herein, operate
as a waiver of any right, power or remedy of Lender under any of the Loan
Documents, nor constitute a waiver of any provision of any of the Loan Documents
except as expressly modified by this Agreement. By its execution of this
Agreement, each Subsidiary Guarantor confirms and reaffirms its obligations
under the Loan Documents to which it is a party in accordance with their
respective terms.

     

    Section
10.10.                    Governing
Law.  This
Agreement and the rights and obligations of the parties hereto shall be governed
by, and construed and interpreted in accordance with, the law of the State of
New York.

     

    Section
10.11.                    Submission to
Jurisdiction.  Any
legal action or proceeding with respect to this Agreement or any other Loan
Document may be brought in the courts of the State of New York or of the United
States of America for the Southern District of New York, and, by execution and
delivery of this Agreement, the Borrower hereby accepts for itself and in
respect of its property, generally and unconditionally, the jurisdiction of the
aforesaid courts.  The parties hereto hereby irrevocably waive any
objection, including any objection to the laying of venue or based on the
grounds of forum non conveniens, which any of them may now or hereafter have to
the bringing of any such action or proceeding in such respective
jurisdictions.

     

    Section
10.12.                    Waiver of Jury
Trial.  EACH
OF THE LENDER AND BORROWER IRREVOCABLY WAIVES TRIAL BY JURY IN ANY ACTION OR
PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT.

     

    Section
10.13.                     Marshaling; Payments Set
Aside.  Lender
shall not be under any obligation to marshal any assets in favor of Borrower or
any other party.  To the extent that Borrower makes a payment or
payments to Lender in respect of Obligations or Lender receives payment from the
proceeds of the Collateral or exercise their rights of setoff, and such payment
or payments or the proceeds of such enforcement or setoff or any part thereof
are subsequently invalidated, declared to be fraudulent or preferential, set
aside or required to be repaid to a trustee, receiver or any other party, then
to the extent of 

     

    
      
        
           


        

        
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    such
recovery, the obligation or part thereof originally intended to be satisfied,
and all Liens, right and remedies therefore, shall be revived and continued in
full force and effect as if such payment had not been made or such enforcement
or set-off had not occurred.

     

    Section
10.14.                     Section
Titles.  The
Section titles contained in this Agreement are and shall be without substantive
meaning or content of any kind whatsoever and are not a part of the agreement
between the parties hereto.

     

    Section
10.15.                     Execution in
Counterparts.  This
Agreement may be executed in any number of counterparts and by different parties
in separate counterparts, each of which when so executed shall be deemed to be
an original and all of which taken together shall constitute one and the same
agreement.  Signature pages may be detached from multiple separate
counterparts and attached to a single counterpart so that all signature pages
are attached to the same document.

     

    Section
10.16.                     Entire
Agreement.  This
Agreement, together with all of the other Loan Documents and all certificates
and documents delivered hereunder or thereunder, embodies the entire agreement
of the parties and supersedes all prior agreements and understandings relating
to the subject matter hereof.

     

    


    
      
        
           


        

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

     

    


    
      	
              LENDER:

               

              THE
      DOW CHEMICAL COMPANY

               

               

              By:  /s/  J. P.
      REINHARD

              Name:     J.
      P. Reinhard

              Title:       Executive
      Vice President and

              Chief Financial
      Office

               

               

              BORROWER:

               

              UNION
      CARBIDE CORPORATION

               

               

              By:  /s/  EDWARD
      W. RICH

              Name:     Edward
      W. Rich

              Title:      
      Chief Financial Officer, Vice President and Treasurer

               

            	
              SUBSIDIARY
      GUARANTORS:

               

              UNION
      CARBIDE SUBSIDIARY C, INC.

               

               

              By:  /s/  JOHN P.
      YIMOYINES

              Name:         John
      P. Yimoyines

              Title:           President

               

               

              UNION
      CARBIDE CHEMICALS & PLASTICS TECHNOLOGY CORPORATION

               

               

              By:  /s/  ALEX J.
      MAKAI

              Name:        
      Alex J. Makai

              Title:           President

               

               

              UCMG
      LLC

               

               

              By:  /s/  DANIEL
      C. SCHEID

              Name:         Daniel
      C. Scheid

              Title:           President

               

               

              CATALYSTS,
      ADSORBENTS AND PROCESS SYSTEMS, INC.

               

               

              By:  /s/  JOHN P.
      YIMOYINES

              Name:         John
      P. Yimoyines

              Title:           President

               

            


    

    


     

    


    
      
        
           


        

        
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    EXECUTION
COPY

    


    EXHIBIT
B

    


    FORM
OF NOTE

    


    $____________________                                                                                   As
of _____________, 200__

    


    


    FOR
VALUE RECEIVED, the undersigned, UNION CARBIDE CORPORATION, a New York
corporation (“Borrower”), promises to pay
to THE DOW CHEMICAL COMPANY, a Delaware corporation (hereinafter, “Lender”), at the office of
Lender in Midland, Michigan or such other place as Lender may designate in
writing to the Borrower, the principal sum of
_________________________

    ________________________________AND___/100s
DOLLARS ($_________________) in United Sates

    Funds,
or, if less, so much thereof as may from time to time be outstanding, plus
interest as hereinafter provided.

    


    Capitalized terms used but not defined
herein shall have the meanings specified in the Revolving Credit Agreement dated
as of May 28, 2004, and entered into by and between Borrower and Lender (as the
same may be amended, modified, supplemented or restated from time to time, the
“Credit
Agreement”).

    


    All principle amounts and other amounts
then outstanding hereunder shall be due and payable on the Termination
Dated.

    


    Borrower shall also repay principle
outstanding hereunder from time to time as provided by Section 2.8 of the Credit
Agreement.

    


    Borrower shall be entitled to borrow
and re-pay Loans evidenced hereunder pursuant to the terms and conditions of the
Credit Agreement.  Prepayment of the principle amount of any Loans may
be made only as provided in the Credit Agreement.

    


    Borrower hereby promises to pay
interest on the unpaid principle amount hereof as provided in Section 2.9 of the
Credit Agreement.  Overdue principle and overdue interest shall bear
interest payable on DEMAND at the default rate as provided in the Credit
Agreement.

    


    In no event shall the amount of
interest due or payable hereunder exceed the maximum rate of interest allowed by
Requirement of Law, and in the event any such payment is inadvertently made by
Borrower or inadvertently received by Lender, then such excess sum shall be
credited as a payment of principle, unless Borrower shall notify Lender in
writing that it elects to have such excess sum returned forthwith.  It
is the express intent hereof that Borrower not pay and Lender not receive,
directly or indirectly in any manner whatsoever, interest in excess of that
which may legally be paid by Borrower under Requirements of Law.

    


    All parties now or hereafter liable
with respect to this Note, whether Borrower, any guarantor, endorser, or any
other Person or entity, hereby waive presentment for payment, demand, notice of
non-payment or dishonor, protest and notice of protest.

    


    


    


    
      
        
           


        

        
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    No delay or omission on the part of
Lender or any holder hereof in exercising its rights under this Note, or delay
or omission on the part of Lender in exercising its rights under the Credit
Agreement or under any other Loan Document, or course of conduct relating
thereto, shall operate as a waiver of such rights or any other right of Lender
or any holder hereof, nor shall any waiver by Lender or any holder hereof of any
such right or rights on any one occasion be deemed a bar to, or waiver of, the
same right or rights on any future occasion.

    


    Borrower promises to pay all reasonable
costs of collection, including reasonable attorneys’ fees, should this Note be
collected by or through an attorney-at-law or under advice
therefrom.

    


    Time is of the essence of this
Note.

    


    This Note evidences Loans under, and is
entitled to the benefits and subject to the terms of, the Credit Agreement,
which contains provisions with respect to the acceleration of the maturity of
this Note upon the happening of certain stated events, and provisions for
prepayment.  This Note is secured by and is also entitled to the
benefits of the Collateral Documents and any other agreement or instrument
providing collateral for the Loans, whether now or hereafter in existence, and
any filings, instruments, agreements, and documents related thereto and
providing collateral for the Loans.

    


    To the extent there are inconsistencies
between this Note and the Credit Agreement, the Credit Agreement shall
govern.

    


    THIS NOTE SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW
YORK.

    


    EACH OF THE LENDER AND THE BORROWER
IRREVOCABLY WAIVES TRAIL BY JURY IN ANY ACTION OR PRECEEDING WITH RESPECT TO
THIS NOTE OR THE CREDIT AGREEMENT.

    


    


    IN WITNESS WHEREOF, a duly authorized
officer of Borrower has executed this Note as of the day and year first above
written.

    


    


    


    BORROWER:                                                                UNION
CARBIDE CORPORATION

    


    By:  ____________________________

    Name:

    Title:

    


     

    


    
      
        
           


        

        
          120