EX-10.1






AMENDMENT NO. 5 TO CREDIT AND GUARANTY AGREEMENT




AMENDMENT NO. 5 TO CREDIT AND GUARANTY AGREEMENT (this “Amendment”), dated as of December 15,
2006, among Kraton Polymers LLC, a Delaware limited liability company (“Company”), each of the
Guarantors listed on the signature pages hereto, the Lenders party hereto, and UBS AG, Stamford
Branch (“UBS”), as administrative agent and collateral agent (“Agent”).



RECITALS



WHEREAS, Company, the Guarantors, the Lenders, Goldman Sachs Credit Partners L.P. and UBS
Securities LLC, as Lead Arrangers, and UBS, as Agent, entered into the Credit and Guaranty
Agreement dated as of December 23, 2003 (as amended pursuant to that certain Amendment No. 1 to
Credit and Guaranty Agreement dated as of March 4, 2004, that certain Amendment No. 2 to Credit and
Guaranty Agreement dated as of October 21, 2004, that certain Amendment No. 3 to Credit and
Guaranty Agreement dated as of February 16, 2006 and that certain Amendment No. 4 to Credit and
Guaranty Agreement dated as of May 12, 2006, and as further amended, restated supplemented or
otherwise modified from time to time, the “Credit Agreement”);



WHEREAS, Company desires to (i) form a limited partnership organized under the laws of the
Netherlands (“New Holding Dutch CV”) of which Company will own, directly and/or indirectly
through one or more of its wholly-owned Domestic Subsidiaries all of the outstanding Capital Stock
(provided that New Holding Dutch CV will in any event have at least two partners), (ii) contribute
to the undivided community of property (onverdeelde goederenrechtelijke gemeenschap) created
pursuant to the formation documents for New Holding Dutch CV, 100% of the Capital Stock of Kraton
Polymers Holdings BV, a company organized under the laws of the Netherlands (“KP Holdings
BV”), and (iii) cause New Holding Dutch CV and Kraton Polymers U.S. LLC to enter into a
qualified cost sharing agreement substantially in principle in the form attached hereto as
Annex I (the actions described in clause (i) through (iii ) above are collectively referred
to herein as the “Restructuring”);



WHEREAS, Company, the Guarantors, the Requisite Lenders and Agent have agreed to amend and
waive certain provisions of the Credit Agreement, in each case, as provided herein.



NOW, THEREFORE, in consideration of the premises made hereunder, and for good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto,
intending to be legally bound, hereby agree as follows:



Section 1. Definitions. Unless otherwise expressly defined herein, all capitalized
terms used herein and defined in the Credit Agreement shall be used herein as so defined.



Section 2. Amendment to Section 1.1. Section 1.1 of the Credit Agreement is hereby
amended as follows:



(a) The definitions of each of the following new terms shall be inserted in alphabetical order
and shall read in their entirety as follows:



“Cost Sharing Agreement” means that certain qualified cost sharing agreement to be entered
into between New Holding Dutch CV and Kraton Polymers U.S. LLC substantially in the form of Exhibit
P.



“Fifth Amendment Effective Date” means December 15, 2006.



“KP Holdings BV” means Kraton Polymers Holdings BV, a company organized under the laws of the
Netherlands, 100% of the Capital Stock of which is (a) immediately prior the Restructuring, owned
by Company and (b) immediately after the Restructuring, owned for the account of New Holding Dutch
CV.



“New Holding Dutch CV” means a limited partnership organized under the laws of the Netherlands
of which Company will own, directly and/or indirectly through one or more of its wholly-owned
Domestic Subsidiaries all of the outstanding Capital Stock.



“Restructuring” means (i) the formation by Company, through two or more of its wholly-owned
Domestic Subsidiaries, of New Holding Dutch CV, (ii) the contribution by Company to the undivided
community of property (onverdeelde goederenrechtelijke gemeenschap) created pursuant to the
formation documents for New Holding Dutch CV of 100% of the Capital Stock of KP Holdings BV and
(iii) the execution of the Cost Sharing Agreement by the parties thereto.



Section 3. Amendment to Section 6.9. (i) Clause (f) of Section 6.9 of the Credit
Agreement is hereby amended by deleting the word “and” at the end of such provision and (ii) clause
(g) of Section 6.9 of the Credit Agreement is hereby amended by deleting the period at the end of
such provision and inserting the following: “; and (h) the Restructuring, including the
transactions contemplated by, or incidental to, the Cost Sharing Agreement.”



Section 4. Amendment to Section 6.12. (i) Clause (g) of Section 6.12 of the Credit
Agreement is hereby amended by deleting the word “and” at the end of such provision and (ii) clause
(h) of Section 6.12 of the Credit Agreement is hereby amended by deleting the period at the end of
such provision and inserting the following: “; and (i) any transaction necessary to effect the
Restructuring, including the transactions contemplated by, or incidental to, the Cost Sharing
Agreement as in effect on the Fifth Amendment Effective Date.”



Section 5. Amendment to Section 6.15. Clause (a) of Section 6.15 of the Credit
Agreement is hereby amended by inserting the words “or the Cost Sharing Agreement after the Fifth
Amendment Effective Date (except for any amendment, restatement, supplement or other modification
to, or waiver that does not adversely affect the interests of the Lenders in any material respect)”
after the words “Fourth Amendment Effective Date” in the fourth line thereof.



Section 6. Amendment to Article V. Article V of the Credit Agreement is hereby
amended by adding a new Section 5.13 as follows:



“5.13. Pledge of Shares of New Holding Dutch CV. On or prior to a date that is 90 days after
the Fifth Amendment Effective Date (or such extended period of up to 60 days as agreed to by the
Administrative Agent in its reasonable discretion), Company shall (i) take all actions and execute
and deliver all such documents, instruments, agreements and certificates necessary to grant to
(and, to the extent relevant under applicable law, to perfect) a First Priority Lien in favor of,
Collateral Agent, for the benefit of Secured Parties, under a deed of pledge governed by the laws
of the Netherlands in form and substance reasonably satisfactory to Collateral Agent, in the
Capital Stock of New Holding Dutch CV, in the form of a right of pledge (pandrecht) over 65% of
each financial claim from each holder of Capital Stock of New Holding Dutch CV under the formation
documents for New Holding Dutch CV and against all other holders of Capital Stock of New Holding
Dutch CV, including but not limited to entitlements in the undivided community of property
(onverdeelde goederenrechtelijke gemeenschap) of the New Holding Dutch CV, including but not
limited to its right to any (i) payments of profits, (ii) distribution of reserves, (iii)
liquidation proceeds, and (iv) any other payments or distributions, whether present or future,
whether actual or contingent      , to the extent permitted by applicable law.”



Section 7. Consent to the Restructuring. Pursuant to 10.05(a) of the Credit
Agreement, upon the effectiveness of this Amendment in accordance with Section 7 below, the Lenders
hereby (i) consent to the Restructuring and (ii) in connection with the Restructuring, consent to
the release, cancellation and termination of the pledge of the Capital Stock of KP Holdings BV made
by Company in favor of the Collateral Agent for the benefit of the Secured Parties, which the
parties hereto agree shall be so released, cancelled and terminated upon the effectiveness of this
Amendment.



Section 8. Conditions Precedent. This Amendment shall become effective upon
satisfaction of each of the following conditions precedent:



(a) Agent shall have received all of the following, in form and substance satisfactory to
Agent:



(i) Amendment Documents. This Amendment and each other instrument, document or
certificate required by Agent, duly executed and delivered by Company, the Guarantors, the
Requisite Lenders and any other Person in connection with this Amendment;



(ii) Cost Sharing Agreement. The Agent shall have received a fully executed or
conformed copy of the Cost Sharing Agreement; the Cost Sharing Agreement shall be in full force and
effect, shall include terms and provisions reasonably satisfactory to Agent and no provision
thereof shall have been modified or waived in any respect determined by Agent to be material
without the consent of Agent; and



(ii) Additional Information. Such additional documents, instruments and information
as Agent may reasonably request to effect the transactions contemplated hereby.



(b) After giving effect to this Amendment, the representations and warranties contained herein
and in the Credit Documents shall be true and correct in all material respects as of the date
hereof as if made on the date hereof (except for those which by their terms specifically refer to
an earlier date, in which case such representations and warranties shall have been true and correct
in all material respects as of such earlier date).



(c) All corporate proceedings taken in connection with the execution and delivery of this
Amendment and all other agreements, documents and instruments executed and/or delivered pursuant
thereto, and all legal matters incident thereto, shall be reasonably satisfactory to Agent.



(d) No Default or Event of Default shall have occurred and be continuing after giving effect
to this Amendment.



Section 9. Representations and Warranties. Company hereby represents and warrants to
Agent and the Lenders that, as of the date hereof and after giving effect to this Amendment, (a)
all representations and warranties set forth in the Credit Agreement and in any other Credit
Document are true and correct in all material respects as if made again on and as of such date
(except those, if any, which by their terms specifically relate only to an earlier date, in which
case such representations and warranties shall have been true and correct in all material respects
as of such earlier date), (b) no Default or Event of Default has occurred and is continuing, and
(c) the Credit Agreement (as amended by this Amendment), and all other Credit Documents are and
remain legal, valid, binding and enforceable obligations of the Credit Parties in accordance with
the terms thereof except as may be limited by bankruptcy, insolvency, reorganization, moratorium or
similar laws relating to or limiting creditors’ rights generally or by equitable principles
(regardless of whether enforcement is sought in equity or at law).



Section 10. Survival of Representations and Warranties. All representations and
warranties made in this Amendment or any other Credit Document shall survive the execution and
delivery of this Amendment, and no investigation by Agent or the Lenders shall affect the
representations and warranties or the right of Agent and the Lenders to rely upon them. If any
representation or warranty made in this Amendment is false in any material respect as of the date
made or deemed made, then such shall constitute an Event of Default under the Credit Agreement.



Section 11. Reference to Agreement. Each of the Credit Documents, including the
Credit Agreement, and any and all other agreements, documents or instruments now or hereafter
executed and/or delivered pursuant to the terms hereof or pursuant to the terms of the Credit
Agreement as amended hereby, are hereby amended so that any reference in such Credit Documents to
the Credit Agreement, whether direct or indirect, shall mean a reference to the Credit Agreement as
amended hereby. This Amendment shall constitute a Credit Document under the Credit Agreement.



Section 12. Costs and Expenses. Company shall pay on demand all reasonable,
documented, out-of-pocket costs and expenses of Agent and the Lead Arrangers (including the
reasonable fees, costs and expenses of counsel to Agent) incurred in connection with the
preparation, execution and delivery of this Amendment.



Section 13. Governing Law. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES THEREOF.



Section 14. Execution. This Amendment may be executed in any number of counterparts
and by different parties hereto in separate counterparts, each of which when so executed shall be
deemed to be an original and all of which taken together shall constitute one and the same
agreement. Delivery of an executed counterpart of a signature page to this Amendment by telecopier
shall be effective as delivery of a manually executed counterpart of this Amendment. This
Amendment shall be binding upon each signatory hereto, its successors and assigns.



Section 15. Certain Waivers. Each of Company and each Guarantor hereby agrees that
neither Agent nor any Lender shall be liable under a claim of, and hereby waives any claim against
Agent and the Lenders based on, lender liability (including, but not limited to, liability for
breach of the implied covenant of good faith and fair dealing, fraud, negligence, conversion,
misrepresentation, duress, control and interference, infliction of emotional distress and
defamation and breach of fiduciary duties) as a result of the consents and amendments contained in
Sections 2 through 5 above and any discussions or actions taken or not taken by Agent or the
Lenders on or before the date hereof or the discussions conducted in connection therewith, or any
course of action taken by Agent or any Lender in response thereto or arising therefrom;
provided, that the foregoing waiver shall not include the waiver of any claims which are
based on the gross negligence or willful misconduct of Agent or any Lender or any of their
respective agents. This Section 15 shall survive the execution and delivery of this Amendment and
the other Credit Documents and the termination of the Credit Agreement.



Section 16. Limited Effect. This Amendment relates only to the specific matters
expressly covered herein, shall not be considered to be a waiver of any rights or remedies any
Lender may have under the Credit Agreement or under any other Credit Document, and shall not be
considered to create a course of dealing or to otherwise obligate in any respect any Lender to
execute similar or other amendments or grant any waivers under the same or similar or other
circumstances in the future.



Section 17. Ratification by Guarantors. Each of the Guarantors acknowledges that its
consent to this Amendment is not required, but each of the undersigned nevertheless does hereby
agree and consent to this Amendment and to the documents and agreements referred to herein. Each
of the Guarantors agrees and acknowledges that (i) notwithstanding the effectiveness of this
Amendment, such Guarantor’s Guaranty shall remain in full force and effect without modification
thereto and (ii) nothing herein shall in any way limit any of the terms or provisions of such
Guarantor’s Guaranty or any other Credit Document executed by such Guarantor (as the same may be
amended from time to time), all of which are hereby ratified, confirmed and affirmed in all
respects. Each of the Guarantors hereby agrees and acknowledges that no other agreement,
instrument, consent or document shall be required to give effect to this Section 17. Each of the
Guarantors hereby further acknowledges that Company, Agent and any Lender may from time to time
enter into any further amendments, modifications, terminations and/or waivers of any provisions of
the Credit Documents without notice to or consent from such Guarantor and without affecting the
validity or enforceability of such Guarantor’s Guaranty or giving rise to any reduction,
limitation, impairment, discharge or termination of such Guarantor’s Guaranty.



1



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



KRATON POLYMERS LLC



	 	 	 
	By:

	 	/s/ Joseph J. Waiter
	
 
	 	 
	Name:

Title:

	 	Joseph J. Waiter

Vice President and General Counsel






GUARANTORS:



POLYMER HOLDINGS LLC


ELASTOMERS HOLDINGS LLC


KRATON POLYMERS U.S. LLC


KRATON POLYMERS CAPITAL CORPORATION



	 	 	 
	By:

	 	/s/ Joseph J. Waiter
	
 
	 	 
	Name:

Title:

	 	Joseph J. Waiter

Vice President and General Counsel






AGENT:



UBS AG, STAMFORD BRANCH,



as Administrative Agent and as Lender



	 	 	 
	By:

	 	/s/ Irja R. Otsa
	
 
	 	 
	Name:

Title:

	 	Irja R. Otsa

Associate Director
	 
	 	 
	By:

	 	/s/ Mary E. Evans
	
 
	 	 
	Name:

Title:

	 	Mary E. Evans

Associate Director
	 
	 	 






2




ANNEX I




Form of Cost Sharing Agreement




RESEARCH AND DEVELOPMENT




COST SHARING AGREEMENT




This Research and Development Cost Sharing Agreement (the “Agreement”) is entered into
effective as of [December 30], 2006 (the “Effective Date”), by and between [Kraton Polymers U.S.
LLC, a Delaware company (“KP”); and [New Holding Dutch CV], a Dutch limited partnership organized
and existing under the laws of the Netherlands (“CV”).



RECITALS



WHEREAS, the parties are engaged in the business of designing, developing, manufacturing,
marketing, and selling products agreed by the Parties;



WHEREAS, the parties consider it beneficial that certain research and development activities
concerning technology to be developed and incorporated in such Products be conducted by the parties
for the benefit of each party;



WHEREAS, the parties recognize that other related third parties may purchase Products on arm’s
length terms and conditions;



WHEREAS, the parties desire to establish a structure whereby each party will share in the
research and development costs incurred on or after the Effective Date in order to further develop
the Existing Technology and to develop New Technology; and



WHEREAS, the parties intend to exploit the Intellectual Property rights, technology and other
intangible property rights developed in accordance with this Agreement in their respective
businesses;



NOW, THEREFORE, in consideration of the mutual covenants and obligations set forth, the
parties agree to be legally bound as follows:



1. Definitions



1.1 Covered Research. “Covered Research” shall mean those research and development
activities identified in Exhibit A to this Agreement, as may be modified from time to time
by the parties.



1.2 Current Products. “Current Products” shall mean those specific products that
exist on the Effective Date which are proprietary products of KP and KP subsidiaries included in
the KP consolidated U.S. Federal income tax return and those specific products that exist on the
Effective Date which are proprietary products of CV and CV subsidiaries.



1.3 Existing Technology. “Existing Technology” shall mean and include any and all
Intellectual Property which exists as of the Effective Date which is owned by KP and/or CV, or
licensed from other parties by KP and/or CV with rights to sublicense, and which is involved in the
manufacture, use or sale of Current Products, or sublicense of Intellectual Property, or is
otherwise in existence on the Effective Date.



1.4 Future Products. “Future Products” shall mean those products (including modified
or improved Current Products) that incorporate New Technology developed by or for KP and CV after
the Effective Date pursuant to the terms of this Agreement.



1.5 Intellectual Property. “Intellectual Property” shall mean and include any and all
intellectual property or proprietary rights, including but not limited to copyright rights
(including rights in audiovisual works), moral rights, patent rights (including patent applications
and disclosures), rights of priority, mask work rights, trade secret rights, know-how,
technologies, procedures, processes, designs, inventions, discoveries, and any and all trademarks,
trade names and other marketing intangibles, recognized in any country or jurisdiction in the
world.



1.6 New Technology. “New Technology” shall mean and include any and all Intellectual
Property which does not exist as of the Effective Date and is developed as a result of Covered
Research.



1.7 Products. “Products” shall mean Current Products and Future Products.



1.8 Territory. “Territory” shall mean everywhere in the world except the United
States of America.



2. Ownership of New Technology



The parties agree that, with respect to all New Technology developed by or for either of them,
CV shall beneficially and exclusively own all rights, title and interest in and to such New
Technology in the Territory and KP shall beneficially and exclusively own all rights, title and
interest outside the Territory. [Notwithstanding the foregoing, KP and CV herewith grant to one
another a nonexclusive, royalty-free license to the New Technology, including the right to
sublicense, to make, have made, and reproduce Products and for use in researching and developing
New Technology and Future Products worldwide.] The parties further agree to execute such documents
and to perform such other acts as may be necessary or desirable to evidence or effectuate the
foregoing division of ownership rights. Legal title to New Technology shall be held by [KP].



3. Allocation of Research and Development Costs



3.1 Allocation Percentage. Research and Development Costs shall be calculated in
accordance with Section 4 below. Each party shall be responsible for paying a percentage of the
Research and Development Costs (the “Allocation Percentage”), which shall be based on the
respective reasonably anticipated benefits to each party from the New Technology expected to be
created. [The Allocation Percentage for each party shall be a fraction, the numerator of which is
that party’s current year gross margin from New Technology and Existing Technology and the
denominator of which is the current year combined gross margin of the parties from New Technology
and Existing Technology.]



3.2 [Gross Margin. For purposes of Section 3.1, gross margin shall mean all gross
revenues accrued by the parties from the sale, lease or license of any Product to non-affiliates,
less cost of goods sold recorded on the legal entity books of each company, without regard to any
revenue and cost of goods sold that is deferred for consolidated financial statement purposes
(e.g., for sales to distributors still in distributor inventory), and less sales or use, VAT, GST,
or similar taxes imposed on sales, transportation and insurance charges billed separately to
customers, and credits, allowances and returns granted to customers in the period in which such
credits, discounts, allowances or returns are actually allowed or granted. In the case of sales,
leases or licenses of Products by affiliates of KP or CV, gross margin shall include the gross
margin received by all such affiliates in a distribution chain. In the case of royalties received
from the license of New Technology or Existing Technology to affiliates, gross margin shall exclude
the royalties received but shall include the gross margin received by such affiliates from the
sale, lease or license of any Products sold by such affiliates to non-affiliates. In the case of
licenses of New Technology or Existing Technology to non-affiliates, gross margin shall include all
such royalties received.]



3.3 Computation of Payment. Each company’s Allocation Percentage, multiplied by total
Research and Development Costs, will be its total share. Each company’s actual Research and
Development Costs will be subtracted from the result of this calculation to determine each
company’s net cost sharing payment or reimbursement due.



3.4 Periodic Review and Adjustment. Each year the parties shall review, and when
appropriate, adjust the Allocation Percentages so that they continue to be based on the reasonably
anticipated benefits to each party. For purposes of the preceding sentence, adjustments may
include retroactive and/or prospective adjustments, as may be appropriate based on the parties’
determination.



4. Calculation of Research and Development Costs



4.1 General. The Research and Development Costs to be shared by the parties shall
consist of (i) Direct Costs, as defined in Section 4.2; and (ii) Indirect Costs, as defined in
Section 4.3, incurred by each party. All calculations shall be based on the calculations used by
KP.



4.2 Direct Costs. Direct Costs shall be those costs related directly to the research
and development of the New Technology. Examples of Direct Costs include, but are not necessarily
limited to, salaries, bonuses, other payroll costs and benefits, materials and supplies, and
consulting fees and fees paid under contract to persons other than KP subsidiaries included in the
KP consolidated U.S. Federal income tax return and CV subsidiaries that are disregarded for U.S.
Federal income tax purposes. In the case of KP subsidiaries included in the KP consolidated U.S.
Federal income tax return and CV subsidiaries that are disregarded for U.S. Federal income tax
purposes, Direct Costs shall exclude fees paid between such entities and include the costs incurred
by such entities related directly to the research and development of the New Technology.



4.3 Indirect Costs. Indirect Costs shall be those costs incurred by other departments
that benefit research or development activities. Examples of Indirect Costs include, but are not
necessarily limited to, occupancy costs, and the portion of overall corporate management expense
allocable to the research and development activities. Indirect Costs shall not include domestic or
foreign income taxes, interest expense, depreciation or amortization expense, or a charge for the
use or acquisition of intangible property.



4.4 Exclusions. Neither party shall be entitled to share in government subsidies
granted to another party, whether those subsidies take the form of direct payment of money, a
credit against tax liabilities, or some other form.



4.5 Stock-Based Compensation. For purposes of determining Research and Development
Costs, the parties agree to include stock-based compensation (as defined in United States Income
Tax Treasury Regulation Section 1.482-7(d)(2)(i) and (ii) (2003), as determined in accordance with
United States Income Tax Treasury Regulation Section 1.482-7(d)(2)(iii)(A)), to the extent that
such amounts are issued by [Polymers Holding LLC, a [Texas] corporation] and properly allocable to
Research and Development, and subject to Section 4.6.



4.6 Condition Subsequent. Stock-based compensation is being included in Research and
Development Costs pursuant to this Agreement solely in order to comply with Treas. Reg.
§ 1.482-7(d)(2) (2003). The parties acknowledge and agree that Treas. Reg. § 1.482-7(d)(2) (2003)
may be (a) held to be an invalid and arbitrary regulation by a final decision in a court of law
involving another taxpayer, including a U.S. Supreme Court decision, a decision by a U.S. Court of
Appeals of any Circuit upon denial of a writ of certiorari or lapse of time for filing such writ,
or a decision by a federal trial court upon lapse of time for filing a notice of appeal, or
(b) withdrawn by the Treasury Department (a “Triggering Event”). Within 90 days of a Triggering
Event, the parties shall refund as necessary among the parties an amount equal to the portion of
the cost sharing payments that were attributable to the inclusion of stock-based compensation
pursuant to Treas. Reg. §1.482-7(d)(2).



4.7 Records. Each party shall keep or cause to be kept complete and accurate records
pertaining to the manufacture, use and sale, license, rental or disposition of Products appropriate
to confirm all computations required by this Agreement. Each party shall make such records
available to the other party as may be reasonably requested. Each party may, at its own expense,
request an independent certified public accountant, selected by it and approved by the other party,
shall have access, at a place of the other party’s choosing during ordinary business hours, to such
records as may be reasonably requested. Neither the accountant nor the selected consultants shall
disclose to any information relating to the business of other party other than information relating
solely to the accuracy of the computations under this Agreement.



5. Payments of Allocated Research and Development Costs



Promptly after the close of each fiscal quarter, CV shall inform KP of any Research and
Development Costs incurred by CV during the immediately preceding fiscal quarter. KP shall
determine the amount that CV owes KP based on the Allocation Percentage according to Section 3. KP
shall notify CV of the amount owed by CV to KP hereunder for such quarter and CV shall pay such
amount within sixty (60) days of the end of the fiscal quarter. All payments shall be denominated
in U.S. dollars or euro equivalent, and shall be transferred in such manner as the parties may
mutually agree. Payments not made within sixty (60) days shall accrue interest at the short term
applicable federal rate as defined in § 1274(d) of the U.S. Internal Revenue Code of 1986, as
amended, compounded monthly until such amounts are paid.



6. Confidentiality



The New Technology contains confidential information of the parties (“Confidential
Information”). The parties agree to keep such Confidential Information confidential, and not to
disclose or make such available to any person, except persons who need to know such information to
carry out the intent of this Agreement. The parties agree that they will use the same level of
effort to protect such Confidential Information as they use to protect their own confidential
information of similar importance. The parties’ obligations under this section will not apply to
any information that: (i) was in the public domain at the time of communication or delivery of
such information to a party hereunder; (ii) becomes part of the public domain through no fault of
such party; (iii) was known to the receiving party prior to disclosure to it; (iv) is legally
obtained from a third party that is authorized to have or disclose such information; or (v) is
required to be disclosed by a governmental or judicial authority.



7. Disclaimer of Warranty



Neither party makes any warranty, express or implied, with respect to the Existing Technology
or the New Technology. EACH PARTY EXPRESSLY DISCLAIMS ALL EXPRESS OR IMPLIED WARRANTIES, INCLUDING
WITHOUT LIMITATION ANY WARRANTY OF OWNERSHIP, QUIET ENJOYMENT, MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE WITH RESPECT TO THE EXISTING TECHNOLOGY OR THE NEW TECHNOLOGY.



8. Limitations of Liability



NEITHER PARTY HERETO WILL BE LIABLE TO THE OTHER FOR ANY INDIRECT, SPECIAL, CONSEQUENTIAL, OR
INCIDENTAL DAMAGES ARISING OUT OF THE DEVELOPMENT, MANUFACTURE, USE, DISTRIBUTION, LICENSE OR SALE
OF THE EXISTING TECHNOLOGY OR THE NEW TECHNOLOGY, OR THE ACTIVITIES UNDERTAKEN BY IT PURSUANT TO
THIS AGREEMENT, WHETHER SUCH CLAIM ARISES IN TORT OR CONTRACT, OR ANY OTHER LEGAL THEORY,
REGARDLESS OF WHETHER SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY THEREOF.



9. Export Restrictions



The parties understand that implementation of this Agreement must conform with all applicable
laws and regulations relating to the transfer of technology and property rights from the United
States. The parties understand that KP is subject to regulation by agencies of the United States
government, including the United States Department of Commerce, which may prohibit export or
diversion to certain countries of the Existing Technology, the New Technology or Products. The
parties will not participate in any prohibited export or diversion.



10. Protection of Intellectual Property Rights



KP shall be primarily responsible for obtaining legal protection worldwide for all
Intellectual Property rights related to the New Technology (the “Worldwide Rights”). Any such
legal protection for the Worldwide Rights obtained shall be in the name of KP. If KP elects not to
obtain legal protection in any jurisdiction where CV believes such protection should be obtained,
then CV shall so inform KP in writing. If KP does not agree to promptly attempt to obtain such
protection, then CV may do so at its own cost, provided that such protection shall be in KP’s name
so long as KP takes any steps reasonably requested by CV to facilitate registration in KP’s name.
Any costs incurred by KP pursuant to this Section shall be allocated between the parties in
accordance with Sections 3 and 4 of this Agreement.



11. Relationship of the Parties



This Agreement is not intended to create a partnership or joint venture. CV and KP are
independent contractors and neither of them will be nor represent themselves to be the legal agent,
partner, joint venturer, or employee of the other party for any purpose. Neither party shall enter
into contracts in the name of, or otherwise bind, the other party with respect to matters covered
in this Agreement or otherwise. Neither party will be bound by, nor be liable to, any third person
for any act or any obligation or debt incurred by the other party, except to the extent
specifically agreed to in writing by the parties.



12. Term and Termination



This agreement shall continue in force until terminated as set forth herein. A party may
terminate its participation in this Agreement, by giving thirty days written notice to such effect
to the other party. Termination of this Agreement shall not affect a party’s ownership rights or
other rights in the New Technology, as described in Section 2 above. Sections 2, 6 through 11 and
13 shall survive termination of this Agreement.



13. General Provisions



13.1 Waiver. No term of this Agreement shall be waived and no breach excused by a
party unless such waiver or excuse is made in writing by such party. No consent, waiver or excuse
shall constitute a subsequent consent, waiver or excuse of a similar or different kind.



13.2 Integration and Modification. This is the entire Agreement between the parties
with respect to the subject matter hereof and may be modified only by a writing signed by the
parties.



13.3 Assignment. Neither party may assign, transfer or otherwise dispose of this
Agreement in whole or in part without the prior consent of the other party in writing, and such
consent will not be unreasonably withheld.



13.4 Severability. If any provision of this Agreement is determined to be
unenforceable by a court of competent jurisdiction, such provision shall be enforced to the maximum
extent possible and the remaining provisions of this Agreement shall remain in full force and
effect.



13.5 Applicable Law. This Agreement shall be governed by and construed in accordance
with the laws of the [State of Texas], United States of America, as between residents of [Texas],
excluding those laws related to choice of laws and conflict of laws. Each party hereby consents to
the jurisdiction of the state and federal courts of [Texas].



13.6 Notice. Any notice to be provided hereunder shall be provided in accordance with
the provisions of Exhibit B to this Agreement, as may be modified from time to time by the
parties.



IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their duly
authorized representatives.



Kraton Polymers U.S. LLC


By:      


Name: [     ]


Date:      


Place:      


Witness:     



New Holding Dutch CV


By:      


Name: [     ]


Date:      


Place:      


Witness:      



3




EXHIBIT A




COVERED RESEARCH




“Covered Research” shall mean all activities related to the research and development of
Intellectual Property conducted by or for the parties on or after the Effective Date, [except for
research and development activities conducted by or on behalf of      ]. Covered
Research shall include all research and development activities conducted by KP subsidiaries after
the Effective Date and during the period that they are included in the KP consolidated U.S. Federal
income tax return. Covered Research shall also include all research and development activities
conducted by CV subsidiaries after the Effective Date.


Kraton Polymers U.S. LLC


By:      


Name: [     ]


Date:      


Place:      


Witness:     



New Holding Dutch CV


By:      


Name: [     ]


Date:      


Place:      


Witness:      



4




EXHIBIT B




NOTICE PROVISIONS




Any notice to be provided shall be in English, and shall be provided by personal delivery or
express courier, and shall be deemed given when delivered or two days after deposit with the
express courier, respectively. All such notices shall be sent to the addresses specified below, or
such other address as a party may give in the manner set forth herein.



Kraton Polymers U.S. LLC


By:      


Name: [     ]


Date:      


Place:      


Witness:     



New Holding Dutch CV


By:      


Name: [     ]


Date:      


Place:      


Witness:      




5