exhibi1026.htm


    EXHIBIT
10.26

     

    EXECUTION
COPY

     

    
 

    FIRST
AMENDMENT

     

    Dated
as of November 4, 2009

     

    to

     

    TRANSFER
AND ADMINISTRATION AGREEMENT

     

    Dated
as of November 13, 2008

     

    


     

    This
FIRST AMENDMENT (this “Amendment”) dated as
of November 4, 2009 is entered into among ASHLAND INC., a Kentucky corporation
(“Ashland”),
CVG CAPITAL II LLC, a Delaware limited liability company (“SPV”), the Investors,
Letter of Credit Issuers, Managing Agents and Administrators party hereto, and
BANK OF AMERICA, N.A., as Agent for the Investors.

     

    RECITALS

     

    WHEREAS,
the parties hereto have entered into a certain Transfer and Administration
Agreement dated as of November 13, 2008 (as amended, supplemented or otherwise
modified from time to time, the “TAA”);

     

    WHEREAS,
the parties hereto wish to make certain changes to the TAA as herein
provided;

     

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

     

    SECTION
1. Definitions.  All
capitalized terms not otherwise defined herein are used as defined in the
TAA.

     

    SECTION
2. Changes to
TAA.  Effective as of the date the conditions specified in
Section 3
hereof are satisfied, the TAA is hereby amended as follows:

     

    2.1. The
following new definition is hereby added to Section 1.1 of the TAA in its
appropriate alphabetical placement:

     

    “Valvoline Credit”
means a credit applied to all or a portion of a Receivable owed by a distributor
for products related to Ashland’s Valvoline business unit after the original
sale of such products to such distributor and such distributor has delivered
such products (or a portion of such products) to a third-party Obligor on an
Originator’s behalf and such delivery has resulted in the creation of a new
Receivable from such third-party Obligor; provided that the third-party Obligor
must be an Obligor with all Receivables owing to the Originators financed solely
by this Receivables Facility.”

     

    2.2. The
definition of “Commitment Termination Date” in Section 1.1 is hereby amended by
replacing the date “November 12, 2009” with the date “November 3, 2010” in such
definition.

     

    2.3. The
definition of “Consolidated EBITDA” in Section 1.1 of the TAA is hereby amended
by:

     

    (i)  replacing clause (viii)
thereof in its entirety as follows:  “(viii) restructuring and
integration charges not to exceed $80,000,000 in the aggregate during the three
fiscal year period ending September 30, 2011 (and such amounts may be included
pursuant to this clause (b) in the
calculation of Consolidated EBITDA for any Measurement Period after September
30, 2011 that includes one or more quarters prior to September 30, 2011 in which
such charges were incurred),”; and

     

    (ii)  adding the following
immediately prior to the comma in clause (ix) thereof: “and non-cash equity
compensation expense”.

     

    2.4. Section
2.17(g) is hereby amended by adding the following clause (iii)
thereto:

     

    “(iii)           In
the event the aggregate Cash Collateral amounts on deposit exceed the Letter of
Credit Liability, such excess amount shall be deposited into the Collection
Account and distributed pursuant to Section 2.12.”

     

    2.5. Clause
(c) of the definition of “Termination Date” in Section 1.1 of the TAA is hereby
amended and restated in its entirety as follows:

     

    “(c) the Commitment Termination
Date”

     

    2.6. The
definition of “Alternate Rate” in Section 2.4(b) of the TAA is hereby amended by
replacing the number “1.75” with the number “2.0” in the introductory paragraph
of such definition.

     

    2.7. Clause
(j) of Section 8.1 of the TAA is hereby amended by replacing the number “9.00”
with the number “12.00” in such definition.

     

    2.8. The
definition of “Dilution” in Schedule II of the TAA is hereby amended and
restated in its entirety as follows:

     

    ““Dilution” means, on
any date, an amount equal to the sum, without duplication, of the aggregate
reduction effected on such day in the Unpaid Balances of the Receivables
attributable to any non-cash items including credits, rebates, billing errors,
sales or similar taxes, cash discounts, volume discounts, allowances, disputes
(it being understood that a Receivable is “subject to dispute” only if and to
the extent that, in the reasonable good faith judgment of the applicable
Originator (which shall be exercised in the ordinary course of business) such
Obligor’s obligation in respect of such Receivable is reduced on account of any
performance failure on the part of such Originator), set-offs, counterclaims,
chargebacks, returned or repossessed goods, sales and marketing discounts,
warranties, any unapplied credit memos and other adjustments that are made in
respect of Obligors; provided
that writeoffs or credits related to (i) an Obligor’s bad credit or (ii) a
Valvoline Credit shall not constitute Dilution (provided that if a Valvoline
Credit is applied in accordance with the definition thereof and the aggregate of
the new Receivable generated in connection with the issuance of such Valvoline
Credit owing from the third-party Obligor and the remaining balance of the
Receivable from the applicable distributor (after giving effect to the credit
and any delivery allowance) is less than the balance of the original Receivable
from the distributor, such excess shall constitute Dilution); provided further that
writeoffs or credits related to pricing adjustments shall not constitute
Dilution so long as (a) such pricing adjustments are treated as sale reversals,
(b) the pricing adjustment is processed the same calendar week during which the
related Receivable was generated and (c) the Servicer must deliver a Servicer
Report in any calendar week in which a pricing adjustment is
processed.”

     

    2.9. The
definition of “Dilution Horizon Ratio” in Schedule II of the TAA is hereby
amended by amending and restating clause (ii) as follows:  “(ii) the
Aggregate Unpaid Balance of Eligible Receivables as of such Month End
Date.”

     

    2.10. The
definition of “Minimum Percentage” in Schedule II of the TAA is hereby amended
by replacing the word “four” with the word “five” in clause (a) of such
definition.

     

    2.11. The
definition of “Stress Factor” in Schedule II of the TAA is hereby amended by
replacing the number “2.0” with the number “2.25” in such
definition.

     

    2.12. Exhibit
F-1 of the TAA is hereby amended per Exhibit A of this
Amendment.

     

    SECTION
3. Conditions
Precedent.  Section 2 hereof
shall become effective on the date on which the Agent shall have received a
counterpart (or counterparts) of this Amendment, executed and delivered by each
of the parties hereto, or other evidence satisfactory to the Agent of the
execution and delivery of this Amendment by such parties.

     

    SECTION
4. Miscellaneous.

     

    4.1. Representations and
Warranties.  The SPV hereby represents and warrants that (i)
this Amendment constitutes a legal, valid and binding obligation of the SPV,
enforceable against it in accordance with its terms and (ii) upon the
effectiveness of this Amendment, no Termination Event or Potential Termination
Event shall exist.

     

    4.2. References to
TAA.  Upon the effectiveness of this Amendment, each reference
in the TAA to “this Agreement”, “hereunder”, “hereof”, “herein”, or words of
like import shall mean and be a reference to the TAA as amended hereby, and each
reference to the TAA in any other document, instrument or agreement executed
and/or delivered in connection with the TAA shall mean and be a reference to the
TAA as amended hereby.

     

    4.3. Effect on
TAA.  Except as specifically amended above, the TAA and all
other documents, instruments and agreements executed and/or delivered in
connection therewith shall remain in full force and effect and are hereby
ratified and confirmed.

     

    4.4. No
Waiver.  The execution, delivery and effectiveness of this
Amendment shall not operate as a waiver of any right, power or remedy of any
Agent or any Investor under the TAA or any other document, instrument or
agreement executed in connection therewith, nor constitute a waiver of any
provision contained therein, except as specifically set forth
herein.

     

    4.5. Governing
Law.  This Amendment, including the rights and duties of the
parties hereto, shall be governed by, and construed in accordance with, the
internal laws of the State of New York (without reference to the conflicts of
law principles thereof other than Section 5-1401 of the New York General
Obligations Law).

     

    4.6. Successors and
Assigns.  This Amendment shall be binding upon and shall
inure to the benefit of the parties hereto and their respective successors and
assigns.

     

    4.7. Headings.  The
Section headings in this Amendment are inserted for convenience of reference
only and shall not affect the meaning or interpretation of this Amendment or any
provision hereof.

     

    4.8. Counterparts.  This
Amendment may be executed by the parties hereto in several counterparts,
each of which shall be deemed to be an original and all of which shall
constitute together but one and the same agreement.

     

     

    IN
WITNESS WHEREOF, the parties have caused this Amendment to be executed by their
respective officers thereunto duly authorized, as of the date first above
written.

     

    
      
        	 	 	 	
                 CVG
      CAPITAL II LLC, as SPV

                 

              	 
	 	 	 	
                By: 
      /s/ Lynn P. Freeman

              	 
	 	 	 	
                Name: 
      Lynn P. Freeman

              	 
	 	 	 	
                Title: 
      President

              	 


      

       

       

      
        	 	 	 	
                 ASHLAND
      INC., individually and as Servicer

                 

              	 
	 	 	 	
                By: 
      /s/ J. Kevin Willis

              	 
	 	 	 	
                Name: 
      J. Kevin Willis

              	 
	 	 	 	
                Title: 
      Treasurer

              	 


      

       

      
        	 	 	 	
                 ASHLAND
      INC., individually and as Originator

                 

              	 
	 	 	 	
                By: 
      /s/ J. Kevin Willis

              	 
	 	 	 	
                Name: 
      J. Kevin Willis

              	 
	 	 	 	
                Title: 
      Treasurer

              	 


      

       

      
        	 	 	 	
                YC
      SUSI TRUST, as a Conduit Investor and an 

                Uncommitted
      Investor

                 

              	 
	 	 	 	
                By:  
      Bank of America, National Association,

                  
       as Administrative Trustee

              	 
	 	 	 	 	 
	 	 	 	 By: 
      /s/ William Van Beek	 
	 	 	 	
                Name: 
      William Van Beek

              	 
	 	 	 	
                Title: 
      Principal

              	 


      

       

      
        	 	 	 	
                 LIBERTY
      STREET FUNDING LLC, as a Conduit 

                Investor
      and Uncommitted Investor

                 

              	 
	 	 	 	
                By: 
      /s/ Jill A. Russo

              	 
	 	 	 	
                Name: 
      Jill A. Russo

              	 
	 	 	 	
                Title: 
      Vice President

              	 


      

       

      
         

        
          	 	 	 	
                  BANK
      OF AMERICA, NATIONAL 

                  ASSOCIATION,
      as Agent, as a Letter of Credit 

                  Issuer,
      as a Managing Agent, Administrator and 

                  Committed
      Investor for the Bank of America 

                  Investor
      Group

                   

                	 
	 	 	 	
                  By: 
      /s/ William Van Beek

                	 
	 	 	 	
                  Name: 
      William Van Beek

                	 
	 	 	 	
                  Title: 
      Principal 

                	 
	 	 	 	
                   

                  Commitment: 
      $102,000,000

                	 


        

         

        
           

          
            	 	 	 	
                    THE
      BANK OF NOVA SCOTIA, as a Letter of 

                    Credit
      Issuer and as a Managing Agent, 

                    Administrator
      and Committed Investor for the 

                    Scotia
      Investor Group

                     

                  	 
	 	 	 	
                    By: 
      /s/ Michael Eden

                  	 
	 	 	 	
                    Name: 
      Michael Eden

                  	 
	 	 	 	
                    Title: 
      Director

                  	 
	 	 	 	
                     

                    Commitment: 
      $102,000,000

                  	 


          

        

      

    

     

                                    

         

     

    


    
      
        
        

      

      
        
        

         


      

      
        
        

      

    

    Exhibit
A

    


    Form of Servicer
Report

    


    (See attached)