UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549



                                    FORM 10-K

 [ X ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
                                   ACT OF 1934

For the fiscal year ended: December 31, 2002   Commission file number:      1-71
                          --------------------                            ------


                              BORDEN CHEMICAL, INC.



              New  Jersey                                   13-0511250
           -------------------              ----------------------------------
        (State of incorporation)           (I.R.S. Employer Identification No.)

180  East  Broad  St., Columbus, OH 43215                   614-225-4000
---------------------------------------------    -----------------------------
(Address  of  principal  executive  offices)   (Registrant's  telephone  number)


           SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:

Title  of  each  class               Name  of  each exchange on which registered
----------------------             ---------------------------------------------
8  3/8%  Sinking Fund Debentures             New York Stock Exchange


           SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
                                      NONE

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding  12  months  (or  for such shorter period that the registrant was
required  to  file  such  reports),  and  (2)  has  been  subject to such filing
requirements  for  the  past  90  days.      Yes    X      No
                                                   ---        ---

Indicate  by  check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein and will not be contained, to the best
of  registrant's  knowledge,  in  any  amendment  to  this  Form  10-K.  [x].

Indicate  by  check  mark  whether  the  registrant  is an accelerated filer (as
defined  in  Exchange  Act  Rule  12b-2)      Yes               No X
                                                    -----         ---

Aggregate market value in thousands of the voting stock held by nonaffiliates of
the  Registrant  based  upon  the  average bid and asked prices of such stock on
March 27, 2003:  $0.

Number  of  shares of common stock, par value $0.01 per share, outstanding as of
the  close  of  business  on  March 27, 2003:200,895,628

                       DOCUMENTS INCORPORATED BY REFERENCE

       Document                                                     Incorporated
       --------                                                     ------------
        none                                                             none


               The  Exhibit  Index  is  Located  herein  at sequential pages 83
through  86.

















<PAGE>
                              BORDEN CHEMICAL, INC.

                                      INDEX



<TABLE>
<CAPTION>




<S>                                                                                                     <C>
PART I
Item 1 - Business                                                                                        3
Item 2 - Properties                                                                                      6
Item 3 - Legal Proceedings                                                                               6
Item 4 - Submission of Matters to a Vote of Security Holders                                             8

PART II
Item 5 - Market for the Registrant's Common Equity and Related Stockholder Matters                       9
Item 6 - Selected Financial Data                                                                        10
Item 7 - Management's Discussion and Analysis of Financial Condition and Results of Operations          11
Item 7A -Quantitative and Qualitative Disclosures about Market Risk                                     25
Item 8 - Financial Statements and Supplementary Data                                                    26
         BORDEN CHEMICAL, INC. CONSOLIDATED FINANCIAL STATEMENTS
         Consolidated Statements of Operations, years ended December 31, 2002, 2001 and 2000            26
         Consolidated Balance Sheets, December 31, 2002 and 2001                                        28
         Consolidated Statements of Cash Flows, years ended December 31, 2002, 2001 and 2000            30
         Consolidated Statements of Shareholders' Equity, years ended December 31, 2002, 2001 and 2000  32
         Notes to Consolidated Financial Statements                                                     34
         Independent Auditors' Report .                                                                 67
Item 9 - Changes in and Disagreements with Accountants on Accounting and Financial Disclosure           68

PART III
Item 10 - Directors and Executive Officers of the Registrant                                            68
Item 11 - Executive Compensation                                                                        71
Item 12 - Security Ownership of Certain Beneficial Owners and Management                                76
Item 13 - Certain Relationships and Related Transactions                                                77
Item 14 - Controls and Procedures                                                                       77
Certificate Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                                   80
PART IV
Item 15 - Exhibits, Financial Statement Schedules and Reports on Form 8-K                               82
Signatures                                                                                              89
</TABLE>









































                                     PART I
ITEM  1.   BUSINESS
--------   --------
(dollars  in  thousands  except  per  share  data)

Current  Description  Summary
-----------------------------

The  Company,  Borden Chemical, Inc. (formerly Borden, Inc.) was incorporated on
April  24,  1899.  After  the  third quarter 2001 sale of the Consumer Adhesives
business  ("Consumer  Adhesives")  to an affiliate, the Company's sole remaining
business  is  the  Chemical  business.  The  Company is engaged primarily in the
manufacture  and  distribution  of  forest  products  and  industrial  resins,
formaldehyde,  coatings  and other specialty and industrial chemicals worldwide.
The  Company's  executive  and  administrative  offices are located in Columbus,
Ohio.  Chemical  production  facilities are located throughout the United States
and  in  many  foreign  countries.

In  fourth  quarter  2001,  the  Company  merged  with  its subsidiaries, Borden
Chemical  Holdings,  Inc. and Borden Chemical, Inc.,  executed certain financial
transactions  with  its  parent,  Borden Holdings, Inc. ("BHI"), and changed its
name  to  Borden  Chemical, Inc. (the "Corporate Reorganization") reflecting the
fact  that  the only remaining business of the Company is the Chemical business.
The  Corporate  Reorganization  simplified the legal structure, strengthened the
capital  structure  and  reduced  overhead  costs of the Company. As part of the
Corporate  Reorganization,  certain  functions  were  downsized,  eliminated  or
transferred  to  a separate legal entity, Borden Capital, Inc. ("Capital"), also
owned  by  the  Company's  parent.  Subsequent  to the Corporate Reorganization,
Capital  provided  certain  management,  consulting  and  board services for the
Company  as  well as for other entities owned by Kohlberg, Kravis, Roberts & Co.
(KKR) and charged fees to the Company and the other entities for these services.

During  the  2002  year,  the  Company's  parent  decided to wind down Capital's
operations,  with the cessation of operations expected to occur during the first
half  of  2003.  Certain  management,  consulting  and board services previously
provided  to  the Company by Capital will be assumed by the Company, while other
such  services  will continue to be provided to the Company by KKR for an annual
fee.

Beginning in 2002, the Company reports three operating segments rather than one,
as  previously  reported,  to  better reflect the ongoing internal organization.
Prior  periods  have  been  restated  to  reflect  this  change.  See Note 21 to
Consolidated  Financial  Statements.

Historical  Perspective
-----------------------

On  March  14, 1995, affiliates of KKR acquired control of the Company.  In late
1995,  the  Company  began the process of redesigning its operating structure in
order  to  maximize  value for its owners and determined that certain businesses
did  not fit into its long-term strategic plan.  At the end of 1995, the Company
consisted  of  the  following  business segments: Chemical, Food, Other Consumer
Products, Decorative Products, Dairy and businesses held for sale.  All of these
businesses  were  subsequently  sold  except  for  Chemical.

The  Company  has  made  various  acquisitions  and  divestitures  and  has also
undertaken  numerous  plant  closing  and other business realignment initiatives
primarily  related  to  the Chemical business (discussed below).  Following is a
summary  by  year  of  the  Company's  significant transactions impacting recent
years'  operations.

In  1997,  the  Company  acquired  Melamine Chemicals, Inc., a major producer of
melamine  crystal,  for  which a substantial amount of production was to be used
internally  to  produce  forest  products  and  industrial  resins.

In  1998,  the  Company sold Decorative Products (the entire Decorative Products
segment)  to  an  unrelated  third party.  Also that year the Company acquired a
melamine  resins  and  compounds  business (a component of the Chemical segment)
from  Sun  Coast  Industries,  Inc.

In  1999, the Company acquired Blagden Chemicals, LTD. in the United Kingdom and
Spurlock Industries, Inc. in the U.S. (both Chemical segment).  Blagden produces
formaldehyde,  forest  products  and  industrial  resins.  Spurlock  produces
formaldehyde  and  forest  products  resins.

In  2000,  the  Company  acquired the formaldehyde and certain other assets from
Borden  Chemical  and Plastic Operating Limited Partnership, an affiliate of the
Company,  and  East  Central  Wax,  an  unrelated wax emulsions producer for the
forest  products  business  (both  Chemical segment).  In 2000, the Company also
acquired  certain  assets  and  liabilities  of  a  Canadian based business that
produces  various  consumer adhesive and glue products (included in the Consumer
Adhesives  segment  prior  to  its  sale).

In  August  2001,  an  option,  sold  to BW Holdings, LLC ("BWHLLC") in 1996, to
purchase  74%  of  the  common  shares of Consumer Adhesives was exercised.  The
Company  is  controlled by BWHLLC.  At the same time, another company controlled
by  BWHLLC  purchased  the  remaining  26%  of  Consumer Adhesives common shares
(collectively  the "Consumer Adhesives Sale").  At December 31, 2001 the Company
still  held  a  $110,000  investment  in Consumer Adhesives preferred stock.  On
March  1,  2002,  the  Consumer  Adhesives  preferred  stock  was redeemed for a
$110,000  note  receivable from Consumer Adhesives.  On March 12, 2002, the note
receivable  was sold to BHI for $110,000 in cash plus accrued interest, with the
proceeds  being used to repay affiliated debt.  Consequently, Consumer Adhesives
is  reported  as  a discontinued operation in the Company's financial statements
for  all  periods presented. Also in 2001, the Company and Delta-HA, Inc. merged
their  North  American  foundry  resins  and  coatings  businesses  to  form
HA-International  in  which  the  Company  has  a  75%  interest.

Chemical  Realignment  and  Corporate  Reorganization
-----------------------------------------------------

In  addition  to  acquisitions and divestitures discussed above, the Company has
undertaken  numerous  plant  closing  and other business realignment initiatives
primarily  related to the Chemical business.  These initiatives were designed to
improve  the  effectiveness and efficiency of the Chemical business and to focus
the  Company's  resources  on  its  core  strengths.  Such  business realignment
charges  have  consisted  primarily  of  employee  severance,  plant closure and
environmental  remediation  costs  and  asset  write-offs.  The Company has also
recently  completed  a reorganization of its corporate headquarters function and
its  capital  structure.  The  following  is  a  brief  overview  of  business
realignment  activities  since  1999.

In 1999, the Company recorded $41,572 of business realignment charges related to
the  closure  of  Chemical  plants in Brazil, Uruguay and the Philippines and to
discontinue  a  domestic  Chemical  plant  construction  project.

In 2000, the Company recorded $38,100 of business realignment charges related to
the closure of two forest products plants in the U.S., a formaldehyde and resins
plant in the U.K. resulting from the Blagden acquisition, and a formaldehyde and
resins  plant  in  Argentina.

In  2001,  the Company recorded $126,408 of business realignment charges related
primarily  to the closures of its melamine crystal plant and two forest products
plants  in  the  U.S., realignment of its North American workforce organization,
reorganization  of  its corporate headquarters and the discontinuance of a plant
construction  project.  The  largest  component  of the 2001 charge is a $98,163
impairment  of  melamine crystal fixed assets, spare parts and goodwill that was
the  result  of  the  Company's strategic decision late in 2001 to sell or close
this  plant  and  to enter into a long-term contractual arrangement with a major
supplier  for  a  substantial  portion  of the Company's future melamine crystal
needs.

In  2001,  the Company also completed a significant capital restructuring, which
consisted  primarily  of  a  capital contribution of $614,369 of preferred stock
held by the Company's parent.  The significant impact of this transaction was to
eliminate  future required annual preferred dividend payments of  $73,724.  Also
as  part  of the capital restructuring, the Company's parent made a cash capital
contribution and purchased certain financial assets from the Company for cash in
amounts  that management believed approximated fair value. The cash contribution
and  the  cash received from sale of assets allowed the Company to substantially
repay  its  affiliated  debt  as  of  December  31,  2001.

In  March  2002, the Company further paid down its affiliated debt with proceeds
received  from the sale, to its parent, of its remaining financial investment in
Consumer  Adhesives.

PRODUCTS
Below  are  the  Company's  primary  products  by  operating  segment:

North  American  Forest  Products:  formaldehyde  and  forest  products  resins.

North  American  Performance Resins:  specialty, oilfield, industrial, nonwoven,
laminate  and  foundry  resins,  and  UV  coatings.

International:  formaldehyde,  forest  product  and  performance  resins.

MARKETING  AND  DISTRIBUTION
Domestic  products  are  sold  primarily  by in-house sales forces to industrial
users. To the extent practicable, international distribution techniques parallel
those  used  in  the  United  States.  However,  raw  materials,  production
considerations,  pricing  competition,  government  policy  toward  industry and
foreign  investment,  and  other  factors may vary substantially from country to
country.

COMPETITION
The  Company  is  the  leading  global  producer of thermosetting resins for the
forest  products  industry  and  a  leading producer of thermosetting resins for
industrial and foundry applications. These resins are used to bind or coat other
materials  during  the  manufacturing  process.  The Company is also the world's
largest  producer  of  formaldehyde.  Approximately  50%  of the formaldehyde is
consumed  internally to produce thermosetting resins, with the remainder sold to
third  parties.  UV Coatings are produced for fiber optics coating applications.
The  Company  manufactures  and distributes its products worldwide with the most
significant  markets  being  North  America,  Western  Europe,  Latin  America,
Australia,  and  Malaysia and, generally, holds a leading market position in the
areas  in  which it competes. Resins are provided to a wide variety of customers
for  use  in  the  manufacture  of  structural  building  panels, medium density
fiberboard,  particle  board,  laminate  veneers, insulation binders, automotive
brakes,  and  to  coat  cores  and molds in the metal casting process. The major
competitors are Ashland Specialty Chemical Company, Georgia Pacific Corporation,
Dynea,  and  several  regional  domestic  and  international competitors. Price,
customer  service  and  product  performance  are the primary areas in which the
Company  competes.

MANUFACTURING  AND  RAW  MATERIALS
The  primary  raw  materials used by the Company, in all operating segments, are
methanol,  phenol and urea. Raw materials are available from numerous sources in
sufficient  quantities  but are subject to price fluctuations that cannot always
be  passed  on  to  customers.

The  Company  uses  long-term  purchase agreements for its primary and other raw
materials  in  certain circumstances to assure availability of adequate supplies
at  specified  prices.

CUSTOMERS
The  Company  does not depend on any single customer nor is any business limited
to  a  particular  group  of  customers, the loss of which would have a material
adverse  effect on the business. The primary customers consist of manufacturers,
and  the  business  is  generally  not  seasonal.

PATENTS  AND  TRADEMARKS
The  Company  owns  various  patents,  trademark  registrations  and  patent and
trademark applications in all operating segments around the world which are held
for use or currently used in its operations. A majority of the patents relate to
the  development of new products and processes for manufacturing and use thereof
and  will expire at various times between 2003 and 2013. No individual patent is
considered  to  be  material.

RESEARCH  AND  DEVELOPMENT
Research and development expenditures were $19,080, $22,717 and $22,202 in 2002,
2001  and  2000,  respectively.  Development  and  marketing of new products are
carried  out  at the business unit level and integrated with quality control for
existing  product  lines.

EMPLOYEES
At  December  31,  2002,  the  Company  had  approximately  2,600  employees.
Relationships  with  union  and  non-union  employees  are  generally  good.

WHERE  YOU  CAN  FIND  MORE  INFORMATION
Our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports
on Form 8-K and amendments to those reports are available to the public from the
Securities  and  Exchange  Commission  at  its website http://sec.gov or free of
charge  from  Investor  Relations  which  can  be accessed through the Company's
internet  website  at  http://bordenchem.com.
                     ------------------------





































ITEM  2.   PROPERTIES
-------    ----------

As  of  December  31,  2002,  the  Company operated 27 domestic production and
manufacturing  facilities  in  16  states, the most significant being a plant in
Louisville,  Kentucky.  In  addition, the Company operated 21 foreign production
and  manufacturing  facilities  primarily  in  Canada,  South  America,  Europe,
Australia  and  Malaysia.

The  Company's  manufacturing  and  processing  facilities  are  generally  well
maintained and effectively utilized. Substantially all facilities are owned. The
Company  leases  its  corporate  headquarters  in  Columbus,  Ohio.

The Company is actively engaged in complying with environmental protection laws,
as  well as various federal, state and foreign statutes and regulations relating
to  manufacturing,  processing and distributing its many products. In connection
with  this,  the Company incurred capital expenditures of $3,641 in 2002, $1,190
in  2001  and  $752  in  2000.  The  Company  estimates $8,047 will be spent for
capital  expenditures  in  2003  for  environmental  controls at its facilities.

ITEM  3.  LEGAL  PROCEEDINGS
-------   ------------------

Environmental  Proceedings
--------------------------
The  Company  has  been  notified that it is or may be a potentially responsible
party  with  respect  to  the  cleanup  of  approximately  35  sites  in  active
proceedings brought under the Comprehensive Environmental Response, Compensation
and  Liability Act ("CERCLA") or similar state environmental laws. The Company's
ultimate liability will depend on many factors including its volumetric share of
waste,  the  financial  viability  of other responsible parties, the remediation
methods  and  technology  used,  the  amount  of  time  necessary  to accomplish
remediation and the availability of insurance coverage. While the Company cannot
predict  with certainty the total cost of such cleanup, the Company has recorded
liabilities  of approximately $34,000 and $35,000 at December 31, 2002 and 2001,
respectively,  for  environmental  remediation  costs for these sites in amounts
that  it  believes  are  probable  and reasonably estimable.  Based on currently
available  information  and analysis, the Company believes that it is reasonably
possible  that  costs  associated with such sites may exceed current reserves by
amounts  ranging  from insignificant to approximately $26,000, in the aggregate.
This  estimate  of  the  range  of  reasonably possible additional costs is less
certain  than  the  estimates  upon  which  reserves  are based, and in order to
establish  the  upper  limit  of  such  range, assumptions less favorable to the
Company  among  the  range  of  reasonably  possible  outcomes  were  used.  In
estimating  both  its  current  reserves  for  environmental remediation and the
possible  range  of  additional  costs, the Company has not assumed that it will
bear  the  entire  cost  of  remediation of every site to the exclusion of other
known  potentially  responsible parties who may be jointly and severally liable.
The  ability  of  other  potentially responsible parties to participate has been
taken  into  account, based generally on the parties' probable contribution on a
per  site  basis.

In  addition  to  the  35  sites  referenced  above,  the  Company is conducting
voluntary  clean-ups  at  approximately  20  other  locations.  The  Company has
accrued  approximately  $10,000  and  $8,400  at  December  31,  2002  and 2001,
respectively,  for  remediation  and restoration liabilities at these locations.
Based on currently available information and analysis, the Company believes that
it  is  reasonably  possible  that  costs  associated with such sites may exceed
current reserves by amounts ranging from insignificant to approximately $13,000,
in the aggregate if assumptions less favorable to the Company among the range of
reasonable  possible  outcomes  were  used.  (See  Note  24  to the Consolidated
Financial  Statements).

During  the fourth quarter of 2002, the Company settled its involvement in three
superfund  sites  by  making  payments  totaling  $750.

Private actions against the Company and numerous other defendants are pending in
U.S.  District  Court  in Baton Rouge, Louisiana, alleging personal injuries and
property  damage  in  connection  with  a  waste  disposal  site  in  Louisiana.

On  October  22,  2002  the  U.S.  Bankruptcy Court for the District of Delaware
approved a Settlement Agreement among the Company, Borden Chemicals and Plastics
Operating  Limited Partnership ("BCPOLP"), BCP Management, Inc. ("BCPM"), the US
Environmental  Protection  Agency  and the Louisiana Department of Environmental
Quality,  whereby  the Company agreed to perform certain of BCPOLP's obligations
with  respect  to environmental remediation at BCPOLP's Geismar, Louisiana site.

Affiliate  Bankruptcy  Proceedings
----------------------------------

The  Company's  subsidiary,  BCP Management, Inc. ("BCPM"), filed for protection
under  Chapter  11  of  the  United States Bankruptcy Code, in the United States
Bankruptcy  Court  for  the  District  of Delaware  on March 22, 2002.  BCPM has
served as the general partner of Borden Chemicals and Plastics Operating Limited
Partnership  ("the Partnership") which was created in November 1987 and operated
as  a  commodity chemicals producer.  On April 3, 2001 the Partnership filed for
protection  under Chapter 11 of the United States Bankruptcy Code, in the United
States  Bankruptcy Court for the District of Delaware.  On February 5, 2003, the
US Bankruptcy Court approved a Joint Plan of Liquidation for the Partnership and
BCPM  (the "Joint Plan") which provides for the transfer of the remaining assets
of both entities, including preference, avoidance and other claims against third
parties  (including  the Company) to separate liquidating agents for liquidation
and  distribution  to their creditors.  The Company's ownership interest in BCPM
will  be  extinguished  and  no  distributions  from  BCPM  to  the  Company are
anticipated.  The  Company  recorded charges totaling $30,000 for calendar years
2000  and  2001 to reduce the value of the Company's investment in BCPM to zero.
No  claims  have  been  filed  against  the  Company  in  connection  with these
bankruptcy proceedings; however, no assurance can be given that such claims will
not  be  made  in  the  future.

Imperial  Home  Decor  Group
-----------------------------

In  1998, pursuant to a merger and recapitalization transaction sponsored by The
Blackstone  Group ("Blackstone") and financed by Chase Manhattan Bank ("Chase"),
Borden Decorative Products Holdings, Inc. ("BDPH"), a wholly owned subsidiary of
the Company, was merged with an acquisition vehicle created by Blackstone, which
subsequently  merged  with  Imperial Wallcoverings to create Imperial Home Decor
Group  ("IHDG").  Blackstone  provided  $84,500  in  equity  and  Chase provided
$295,000  in  senior  financing.  Borden received approximately $314,400 in cash
and 11% of IHDG common stock for its interest in BDPH.  On January 5, 2000, IHDG
filed  for  reorganization  under Chapter 11 of the U. S. Bankruptcy Code.  IHDG
emerged  from bankruptcy in April 2001.  The IHDG Litigation Trust (the "Trust")
was  created  pursuant  to  the plan of reorganization in the IHDG bankruptcy to
pursue  preference  and  other  avoidance  claims  on  behalf  of  the unsecured
creditors  of  IHDG.  In  November  2001,  the Trust filed a lawsuit against the
Company  and certain of its affiliates seeking to have the IHDG recapitalization
transaction  voided  as  a fraudulent conveyance and asking for a judgment to be
entered  against  the  Company  for  $314,400, plus interest, costs and attorney
fees.  Discovery  is  pending in the case with a cut-off currently scheduled for
December  2003.  The  Company  believes  it  has  strong defenses to the Trust's
allegations  and  intends  to  defend  the  case  vigorously.

Brazilian  Excise  Tax  Administrative  Appeal
----------------------------------------------

In  1992,  the  State  of  Sao Paolo Tax Bureau issued an assessment against the
Company's  primary  Brazilian subsidiary claiming that excise taxes were owed on
certain  intercompany  loans  made  for  centralized  cash  management purposes,
characterized  by the Tax Bureau as intercompany sales.  Until 1996, discussions
continued  between the subsidiary's management and the Tax Bureau which resulted
in  a  downward  adjustment  in  the  assessment,  at  which  time the Company's
Brazilian  subsidiary filed an administrative appeal seeking cancellation of the
assessment  and,  alternatively,  a  new  audit  of  the  company's records.  In
December  2001,  following  completion  of  the second audit, the Administrative
Court  upheld  the  assessment  in  the  amount  of  $R  40,600,  including tax,
penalties,  monetary  correction  and  interest,  or  approximately $11,000.  In
September  2002,  the  Company's Brazilian subsidiary filed a second appeal with
the  highest  level  administrative  court,  again  seeking  cancellation of the
assessment  on  the grounds that it was unlawfully issued.  The Company believes
it  has  a  strong  defense  against  the  assessment and will pursue the appeal
vigorously;  however,  no assurance can be given that the assessment will not be
upheld.

Other  Legal  Proceedings
-------------------------

The  Company is involved in other litigation throughout the United States, which
is  considered  to  be  in  the  ordinary  course  of  business.  There has been
increased publicity about asbestos liabilities faced by manufacturing companies.
As  a  result  of  the  bankruptcies  of  many  asbestos  producers, plaintiffs'
attorneys  are  increasing  their  focus on peripheral defendants, including the
Company.  The  Company  believes it has adequate reserves and insurance and does
not  believe  it  has  a  material  asbestos  exposure.

Anticipated  Impact
-------------------

Management  believes,  based  upon  the  information it currently possesses, and
taking  into  account its established reserves for estimated liability, that the
ultimate  outcome  of  the  foregoing  environmental  and  legal proceedings and
actions is unlikely to have a material adverse effect on the Company's financial
position  or  operating  results.











ITEM  4.    SUBMISSION  OF  MATTERS  TO  A  VOTE  OF  SECURITY  HOLDERS
--------    -----------------------------------------------------------

During  the  fourth  quarter of 2002, no matters were submitted to a vote of the
Company's  security  holders.


















































































                                     PART II

ITEM  5.  MARKET  FOR  THE  REGISTRANT'S  COMMON  EQUITY
--------------------------------------------------------
AND  RELATED  STOCKHOLDER  MATTERS
----------------------------------

The  Company's authorized common stock consists of 300,000,000 shares with a par
value  of  $0.01  per  share. As of December 31, 2002, 200,923,628 common shares
were  issued and outstanding, of which 99.0% are controlled by affiliates of KKR
with  the  remainder  held  by thirteen members of management. No shares of such
common  stock trade on any exchange. The Company declared no dividends on common
stock  in  2002  and declared $36,434 and $61,578 in dividends in 2001 and 2000,
respectively.  The  Company's  ability  to  pay dividends on its common stock is
restricted  by  its Loan and Security Agreement with certain banks (see Notes 12
and  16  to  the  Consolidated  Financial  Statements).

The  following  table  contains certain information regarding the Company's 1996
Stock  Purchase  and Option Plan for Key Employees, which is administered by the
Compensation  Committee  of  the  Board  of Directors and which provides for the
purchase  or grant of stock and stock-based awards to employees or other persons
having a unique relationship with the Company or its subsidiaries.  (See Note 17
to  the  Consolidated  Financial  Statements).

                                        EQUITY COMPENSATION PLAN INFORMATION
<TABLE>
<CAPTION>
                                                                                                  Number of securities
                                                                                                  remaining available for
                                                                                                  future issuance under
                                    Number of securities to           Weighted-average            equity compensation
                                    be issued upon exercise           exercise price of           plans (excluding
                                    of outstanding options,           outstanding options,        securities reflected in
   Plan Category                    warrants and rights               warrants and rights         column (a))
----------------------------------------------------------------------------------------------------------------------------------
<S>                                        <C>                              <C>                           <C>
                                           (a)                              (b)                           (c)
Equity compensation
plans approved by                         3,624,440                        $3.54                       5,897,559
security holders
----------------------------------------------------------------------------------------------------------------------------------

Equity compensation
plans not approved by                        N/A                           N/A                              N/A
security holders
----------------------------------------------------------------------------------------------------------------------------------
Total                                     3,624,440                                                    5,897,559
</TABLE>








































ITEM  6.   SELECTED  FINANCIAL  DATA
--------   -------------------------
<TABLE>
<CAPTION>
===================================================================================================================================
FIVE  YEAR  SELECTED  FINANCIAL  DATA

The following represents five year selected financial data for the Company.  See
pages  14 through 18 for items impacting comparability between 2002, 2001 and 2000.



CONSOLIDATED                          FOR THE YEARS          2002          2001          2000 (1)          1999 (2)          1998
===================================================================================================================================

<S>                                      <C>                 <C>           <C>             <C>             <C>                <C>
SUMMARY OF EARNINGS
Net sales                                              $1,247,885      $1,372,141      $1,377,845        $1,274,740     $1,320,520
(Loss) income from continuing operations                   (6,758)       (136,604)        (72,259)           44,547          9,122
(Loss) applicable to common stock                         (36,583)       (186,646)        (39,750)          (20,778)       (11,092)
----------------------------------------------------------------------------------------------------------------------------------
Basic and diluted (loss) income per common share
from continuing operations                             $    (0.03)     $    (0.69)     $    (0.36)       $     0.22     $     0.05
Basic and diluted (loss) per common share                   (0.18)          (0.94)          (0.20)            (0.10)         (0.06)
----------------------------------------------------------------------------------------------------------------------------------
Dividends per share
     Common share                                      $      -        $     0.18      $     0.31        $     0.32     $     0.30
     Preferred series A                                       -              2.52            3.00              3.00           3.00
----------------------------------------------------------------------------------------------------------------------------------
Average number of common shares
     outstanding during the year                          200,458         198,997         198,975           198,975        198,975
----------------------------------------------------------------------------------------------------------------------------------
FINANCIAL STATISTICS

Total assets                                           $1,011,780      $1,123,278      $1,520,597        $1,737,906     $2,022,334
Long-term debt                                            523,287         532,497         530,530           541,074        551,963
----------------------------------------------------------------------------------------------------------------------------------
<FN>


(1)     In 2000, the Company acquired a formaldehyde operation from Borden Chemicals and Plastics Operating Limited
Partnership  and  East  Central  Wax,  a  wax  emulsions  producer  for the forest products segment of the Chemical
business.

(2)   In  1999,  the  Company acquired Blagden Chemical, LTD in the United Kingdom and Spurlock Industries, Inc. in
the  U.S.
</TABLE>







































ITEM  7.  MANAGEMENT'S  DISCUSSION  AND  ANALYSIS  OF  FINANCIAL
--------  ------------------------------------------------------
          CONDITION  AND  RESULTS  OF  OPERATIONS
          ---------------------------------------

CRITICAL  ACCOUNTING  POLICIES:
-------------------------------
The Company's significant accounting policies are more fully described in Note 3
to  the  Consolidated  Financial  Statements.  As  disclosed  in  Note  3 to the
Consolidated  Financial  Statements,  preparation  of  financial  statements  in
conformity  with generally accepted accounting principles requires management to
make  estimates  and  assumptions about future events that affect the amounts of
reported  assets,  liabilities, revenues and expenses, as well as the disclosure
of  contingent  assets  and  liabilities,  in  the  financial  statements  and
accompanying  notes.  Estimating  and  predicting  future  events  requires  the
exercise  of  judgment and cannot be done with absolute certainty; consequently,
there can be no assurance that actual results will not differ significantly from
estimated  results.

The  most  significant accounting policies, which reflect significant management
estimates,  in  determining  reported  amounts  in  the  Consolidated  Financial
Statements  and/or  Notes  thereto  are  as  follows:

Asset  impairments  -  The  Company periodically evaluates the recoverability of
property,  equipment and investments by assessing whether the carrying value can
be  recovered  over  its  remaining  useful  life  through  the  expected future
undiscounted  operating  cash  flows of the underlying business.  Any impairment
loss  required  is  determined  by  comparing the carrying value of the asset to
operating  cash  flows  on a discounted basis.  The Company adopted SFAS No. 142
"Goodwill  and Other Intangible Assets" in 2002 which requires the determination
of  estimated  fair  values  of reporting units as assessed against the carrying
amount of the assets and liabilities of the reporting units.  This resulted in a
goodwill  impairment  charge  of  $29,825  related  to  the  Company's  European
reporting unit.  The utilization of different methods, procedures or assumptions
in  determining  estimated  fair  value  could  have  resulted  in a charge of a
different  amount.

Business  realignment  liabilities  -  The  Company  has continued to review and
adjust its structure and streamline its operations to improve financial results.
During  this  process,  the  Company  has recorded costs to close or consolidate
facilities,  write-down  assets  and reflect employee severance costs, partially
offset  by  proceeds  of  related  asset  sales.

Environmental  remediation  and  restoration  liabilities  -  Accruals  for
environmental matters are recorded when it is probable that a liability has been
incurred  and  the  amount  of  the  liability can be reasonably estimated.  The
Company  has  accrued approximately $44,000 and $43,400 at December 31, 2002 and
2001,  respectively, for all probable environmental remediation, indemnification
and  restoration  liabilities,  which  is  management's  best  estimate of these
liabilities.  Based on currently available information and analysis, the Company
believes  that  it  is  reasonably  possible  that  costs  associated  with such
liabilities may exceed current reserves by amounts that may prove insignificant,
or  by amounts, in the aggregate, of up to approximately $39,000.  This estimate
of  the  range  of reasonably possible additional costs is less certain than the
estimates  upon  which  reserves  are based, and in order to establish the upper
limit  of  such range, assumptions less favorable to the Company among the range
of  reasonably  possible  outcomes  were  used.

Income  tax  assets  and  liabilities  - Deferred income taxes represent the tax
effect  of  temporary  differences  between  amounts  of  assets and liabilities
recognized  for financial reporting purposes and such amounts recognized for tax
purposes.  Deferred tax assets are reduced by a valuation allowance when, in the
opinion  of  management,  it is more likely than not that some portion or all of
the  deferred  tax  assets will not be realized.  The Company has tax strategies
that  it  would  execute  before  any  deferred  tax  assets  would  go  unused.
Additionally  in  the  normal  course  of business various federal and state tax
authorities  review  the Company's tax returns.  Significant judgment is used in
estimating  the  accruals  necessary  for  such  tax  exposures.

Pension and postretirement assets and liabilities - The Company utilizes various
weighted  average  rates  in  determining net pension expense and postretirement
benefit  obligations,  as  well  as certain percentage rate increases for health
care  costs.  Historically,  these estimates have proven reasonable but there is
no  assurance  that  these  estimates  will  be  as accurate as in the past.  In
determining  net  pension  expense,  the Company used a discount rate of 7.2% in
2002  as  compared  to  7.7% for 2001 and 2000 and an expected long-term rate of
return  on  plan  assets  of  8.3%  as  compared  to 8.7% for 2001 and 2000.  In
determining  the present value of year-end pension obligations discount rates of
6.5%  and  7.2%  were  used  in 2002 and 2001, respectively.  For postretirement
benefit  obligations,  the Company used a weighted average discount rate of 6.5%
for  2002  as  compared  to  7.25%  for  2001.

Related  party  transactions - The Company records related party transactions at
amounts that management believes approximates fair value and are at amounts that
are not more favorable or unfavorable than could be obtained from third parties.
The  specifics  of  each  major  transaction  and  the  basis for accounting are
described  in  the  notes  to  the  financial  statements.
RESULTS  OF  OPERATIONS  BY  SEGMENT:
------------------------------------

Beginning in 2002, the Company reports three operating segments rather than one,
as  previously  reported,  to  better reflect the ongoing internal organization.
Prior  periods  have  been  restated to reflect this change.  The three segments
reported  are  North American Forest Products, North American Performance Resins
Group  and  International.  In  addition,  Corporate  and  Other  is  reported
separately.  The  product  lines  included in the North American Forest Products
segment  are  formaldehyde and forest products resins.  The key business drivers
in  the  North  American  Forest  Products segment are housing starts, furniture
demand, panel production capacity and chemical sector operating conditions.  The
North  American  Performance  Resins Group segment includes specialty, oilfield,
industrial,  nonwoven,  laminate  and  foundry  resins, and UV coatings.  In the
North  American  Performance  Resins Group segment, the key business drivers are
housing  starts,  auto  builds, active gas drilling rigs, fiber optic demand and
the general industrial sector.  The International segment consists of operations
in Latin America, Europe and Asia Pacific.  Principal countries of operation are
Brazil,  the  United  Kingdom,  Malaysia  and  Australia.  Product lines include
forest  product  and  performance resins.  In the International segment, the key
business  drivers  are export levels, panel production capacity, housing starts,
furniture  demand  and  the  local  political  environment.  Corporate and Other
represents  general  and administrative expenses and income and expenses related
to  divested  businesses.

The  threat  of  potential  military  action  or  war,  as well as the attendant
political  activity has created an atmosphere of economic uncertainty throughout
the  world.  This  environment can significantly affect the macro drivers of our
business.  A  prolonged  downturn or change in macro drivers may have a material
adverse  effect on our financial position, cash flow or results of operations in
any  reporting  period.

Following  is  a  comparison of net sales, operating income (loss), depreciation
and  amortization  and  EBITDA  by  reportable business segment for the Company:

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------
NET  SALES  TO  UNAFFILIATED  CUSTOMERS:

---------------------------------------------------------------------------------------------------
                                              2002                   2001                  2000
---------------------------------------------------------------------------------------------------
<S>                                           <C>                    <C>                     <C>

North American Forest Products             $  634,619            $  656,694            $  610,183
North American Performance Resins             340,791               409,081               386,187
International                                 264,541               282,629               314,852
Businesses sold or distributed                  7,934                23,737                66,623
                                           -----------           ------------          -----------
                                          $ 1,247,885            $ 1,372,141           $1,377,845
---------------------------------------------------------------------------------------------------
</TABLE>

<TABLE>
<CAPTION>

OPERATING  INCOME  (LOSS):
---------------------------------------------------------------------------------------------------
                                              2002                   2001                  2000
---------------------------------------------------------------------------------------------------
<S>                                           <C>                    <C>                    <C>

North American Forest Products             $ 72,302              $  83,559             $ 38,447
North American Performance Resins            32,106                 59,923               84,551
International                                12,388                (16,671)              (7,210)
Corporate and other                         (75,883)               (88,367)             (68,300)
Businesses sold or distributed               (7,205)              (113,939)              (8,749)
                                           -----------           ------------          -----------
                                           $ 33,708              $ (75,495)            $ 38,739
---------------------------------------------------------------------------------------------------
</TABLE>















<TABLE>
<CAPTION>

DEPRECIATION  AND  AMORTIZATION  EXPENSE:
---------------------------------------------------------------------------------------------------

                                              2002                   2001                  2000
---------------------------------------------------------------------------------------------------
<S>                                           <C>                    <C>                    <C>

North American Forest Products             $ 19,259              $  19,950             $ 18,514
North American Performance Resins             9,929                 11,314                9,394
International                                10,305                 11,766               11,634
Corporate and other                           8,454                  9,021                8,237
Businesses sold or distributed                 -                     7,310                7,912
                                           -----------           ------------          -----------
                                           $ 47,947              $  59,361             $ 55,691
---------------------------------------------------------------------------------------------------
</TABLE>


EBITDA  information  is presented with the Company's segment disclosures because
it  is  the  basis  for  a  primary  measure used by the Company to evaluate its
operating  results  and is determined by adding depreciation and amortization to
Operating  Income  (Loss).


<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------
EBITDA:
---------------------------------------------------------------------------------------------------

                                              2002                   2001                  2000
---------------------------------------------------------------------------------------------------
<S>                                           <C>                    <C>                    <C>


North American Forest Products             $ 91,561              $ 103,509             $ 56,961
North American Performance Resins            42,035                 71,237               93,945
International                                22,693                 (4,905)               4,424
Corporate and other                         (67,429)               (79,346)             (60,063)
Businesses disposed of                       (7,205)              (106,629)                (837)
                                          ----------            -----------           -------------
TOTAL EBITDA                               $ 81,655              $ (16,134)            $ 94,430
                                          ==========            ===========           ==========
---------------------------------------------------------------------------------------------------

</TABLE>







































Included  within  EBITDA  are  the  following expenses, income, gains and losses
related  to  business  realignment activities undertaken by the Company, pension
curtailment  expenses  and  certain  other  significant  charges.

<TABLE>
<CAPTION>




SIGNIFICANT AND UNUSUAL ITEMS
IMPACTING EBITDA (1)
----------------------------------------------------------------------------------------------------------------------------------
(EXPENSE) INCOME
----------------------------------------------------------------------------------------------------------------------------------

                                        PLANT
2002                                   CLOSURE (2)         SEVERANCE           IMPAIRMENTS             OTHER              TOTAL
------------------------------------------------------------------------------------------------------------------------------
<S>                                      <C>                   <C>                <C>                   <C>                 <C>
North American Forest Products      $   (1,107)           $   (250)           $     -               $      -         $  (1,357)
North American Performance Resins       (1,950)               (102)              (1,040)                   -             (3,092)
International                             (379)               (795)              (5,275)                   -             (6,449)
Corporate and other (3)                    -                (2,118)                 -                  (13,600)         (15,718)
Businesses sold, distributed or
closed                                   (6,683)                                    -                      -             (6,683)
                                    ------------          ---------           ----------             ----------       ----------
     Total                          $   (10,119)          $ (3,265)           $  (6,315)             $ (13,600)       $ (33,299)
                                    ============          ==========          ===========            ===========      ==========

2001

North American Forest Products      $     3,934           $ (2,080)           $     -                $     -          $   1,854
North American Performance Resins         2,433             (2,632)              (2,885)                                 (3,084)
International                           (20,020)              (179)                                     (2,303)         (22,502)
Corporate and other (3)                     875             (7,691)                                    (16,300)         (23,116)
Businesses sold, distributed or
closed                                                                          (98,163)               (19,028)        (117,191)
                                    ------------          ---------           ----------             ----------       ----------
     Total                          $   (12,778)          $(12,582)           $(101,048)             $ (37,631)       $(164,039)
                                    ============          ==========          ===========            ===========      ==========

2000

North American Forest Products      $   (15,461)          $   -               $    -                 $ (25,330)       $ (40,791)
North American Performance Resins        (1,827)                                                                         (1,827)
International                           (20,682)                                                                        (20,682)
Corporate and other (3)                    (130)                                                        (6,242)          (6,372)
Businesses sold, distributed or
closed                                                                                                  (3,561)          (3,561)
                                    ------------          ---------           ----------             ----------       ----------
     Total                          $   (38,100)          $   -               $     -                $ (35,133)       $ (73,233)
                                    ============          ==========          ===========            ===========      ==========

<FN>

(1)     See  pages  15  through  20  of  the  Management's  Discussion  and Analysis of Financial Condition and Results of
Operations  for  further  information  concerning  these  items.
(2)     Plant  closure  costs  include  fixed asset write-offs, plant employee severance and demolition, environmental and
other  related  costs,  offset  by  any  pre-tax  gain  on  the  sale  of  assets  associated  with  a  closed  plant.
(3)     The  Other  amounts  for  Corporate  represent  pension curtailment charges.  Also included in 2000 were $2,616 of
reserve  reductions  for  businesses  previously  sold.
</TABLE>
























2002  VS.  2001
<TABLE>
<CAPTION>


NET  SALES VARIANCE                    2002 AS A PERCENTAGE INCREASE (DECREASE) FROM 2001
------------------------------------------------------------------------------------------------------------------
                                          VOLUME        PRICE/MIX       TRANSLATION       OTHER      TOTAL
------------------------------------------------------------------------------------------------------------------
<S>                                        <C>            <C>              <C>             <C>          <C>
------------------------------------------------------------------------------------------------------------------
North American Forest Products             6.9%          (8.8%)           (1.5%)                      (3.4%)
North American Performance Resins        (13.9%)         (2.8%)                                      (16.7%)
International                              0.9%          (0.2%)           (4.5%)          (2.6%)      (6.4%)
</TABLE>



North  American  Forest  Products
---------------------------------

North  American  Forest  Product  sales  decreased by $22,075 or 3.4% in 2002 as
decreasing  prices more than offset a volume increase.  The lower selling prices
were  due  to  lower  raw  material prices in the first half of 2002 compared to
2001.  A  portion  of  the Segment's sales are sold under contracts that provide
for  monthly  or  quarterly  selling  price  adjustments based on published cost
indices  for  the  Company's  primary  raw materials (i.e., methanol, phenol and
urea).   In  addition,  competitive  pricing  pressures  negatively impacted the
renewal  of  two  large  long-term  customer contracts in 2002.  Sales were also
negatively  impacted by foreign currency translation due to the weaker US dollar
in  relation  to  the  Canadian  dollar  in  2002  versus  2001.

The  decreases  were  partially  offset  by  increased  volumes which had a 6.9%
positive  impact  on  sales.  Share  gains  and strong demand driven by a strong
housing  sector  were  the  drivers  of  the  volume  increase.

EBITDA  decreased  by  $11,948  or 11.5% versus 2001.  Decreased margins due  to
competitive  pressures,  increasing raw material costs in the second half of the
year and increased insurance and benefit costs  were the principal causes of the
EBITDA  decrease.  Although  raw  material  price increases can contractually be
passed  on to customers, in periods of rising prices there can be a negative lag
effect  due  to  matching  in  timing of the cost increases and contract pricing
trigger  points.    In  addition,  2002  was  negatively  impacted  by $1,107 of
demolition  and  site  cleanup costs related to previously closed facilities and
$250  of severance related to a headcount reduction program, while 2001 included
a  positive  impact from business realignment activities of $1,854, as a $10,500
gain  on  the  sale  of  a closed facility more than offset costs related to the
closure  of  facilities  and  severance  related  to  headcount  reductions.

North  American  Performance  Resins
------------------------------------

North  American  Performance  Resin sales decreased by $68,290, or 16.7% in 2002
versus  2001 due to volume mix and lower selling prices.  While absolute volumes
increased,  a  decrease  in specialty oilfield and UV coatings volumes  led to a
13.9%  decrease  in  sales.  The  volume  decline in oilfield products is due to
reduced  drilling  activity  in  2002 compared to 2001. The UV coatings products
volume  decline  is a result of significantly lower demand for fiber optic cable
in  2002 compared to 2001.  The expected demand outlook for UV coatings products
remains  flat  through  2003  consistent  with the demand for fiber optic cable.
Lower  selling  prices  also  negatively impacted sales by 2.8% due to lower raw
material  costs  in  the first half of the year that were passed on to customers
under  raw  material  based  contracts.

 EBITDA  declined  by  $29,202  or  41% in 2002 due primarily to the decrease in
specialty  oilfield  and UV coatings volumes discussed above.  This decrease was
partially  offset by improved processing costs related to decreased energy costs
and  synergies  realized  as  a  result  of  the  2001  foundry  acquisition.

International
-------------

International  sales  decreased  $18,088 or 6.4% in 2002  due primarily to lower
selling  prices  and  volumes  in  Europe  and Asia, the absence of sales from a
business  in  Ecuador  sold  in  the  third quarter of 2001 and foreign currency
translation in Latin America.  The lower selling prices were the result of lower
average  raw  material costs compared to the same period of 2001 and competitive
pressures  in  Europe.

EBITDA  from International businesses improved $27,598 in 2002 due to a decrease
in  costs  related  to  plant  restructurings  and  impairments  and  improved
operational  results  in  all  regions.  Plant  closure  costs  and  impairments
decreased  by  $14,366  in 2002 compared to 2001 as 2001 plant consolidations in
the  UK and Latin America were completed in 2002.  The remaining improvements in
EBITDA  were primarily attributable to improved margins relating to the positive
spread  between  selling prices and raw material costs for the first half of the
year  and  improved  processing costs in Europe due to the plant consolidations.


Corporate  and  Other
---------------------

Corporate  and Other expenses decreased by $11,917 to a loss of $67,429 in 2002.
The  improvement  is  driven  by  the  absence  of $7,691 of severance and other
charges  related  to the corporate reorganization in 2001, a $2,700 reduction in
pension  settlement  charges  related  to  divested  businesses and the positive
effect  of  the  2001  and  2002  headcount  and cost reduction measures.  These
improvements  were partially offset by increased management fees of $5,500 which
reflect  severance  and  wind  down  costs  related to the phase out of Capital.

Businesses  sold,  distributed  or  closed
------------------------------------------

The  businesses  sold,  distributed  or  closed  classification  represents  the
Company's  infrastructure  management  services  business,  printing  inks  and
melamine  business  results  as well as changes in estimates or costs related to
businesses  previously  divested.  The  distribution  of  the  infrastructure
management  services business occurred in the first quarter of 2000, the sale of
the  printing  inks  business  occurred  in  the  fourth quarter of 2000 and the
closure  of the melamine business occurred in  January of 2002.  The decrease in
losses  attributed  to  businesses  sold,  distributed  or  closed is due to the
absence  in  2002  of  an  impairment  charge of $98,163 related to the melamine
crystal  fixed  assets,  spare parts and goodwill recorded in 2001 and a $19,028
charge that reflects management's estimate of probable environmental remediation
costs  that  the  Company  incurred  related  to  a  previously  owned business.

2001  VS.  2000
<TABLE>
<CAPTION>


NET  SALES  VARIANCE                    2001 AS A PERCENTAGE INCREASE (DECREASE) FROM 2000
------------------------------------------------------------------------------------------------------------------
                                            VOLUME          PRICE/MIX          TRANSLATION     OTHER      TOTAL
------------------------------------------------------------------------------------------------------------------
<S>                                          <C>              <C>                 <C>           <C>         <C>

North American Forest Products              (5.4%)            8.6%               (1.3%)         5.7%        7.6%
North American Performance Resins           (3.8%)            5.5%                              4.3%        6.0%
International                               (7.0%)            9.3%              (10.3%)        (2.2%)     (10.2%)
</TABLE>


North  American  Forest  Products
---------------------------------

North  American Forest Product sales increased $46,511 or 7.6% in 2001 driven by
increased prices and the full year impact of two acquisitions made in the second
half  of  2000.  The  higher average selling prices reflect significantly higher
raw  material  costs  during  the  first  half  of  the  year.  A portion of the
Segment's  sales  are sold under contracts that provide for monthly or quarterly
selling  price  adjustments  based  on  published cost indices for the Company's
primary  raw  materials (i.e., methanol, phenol and urea).  The acquisition of a
formaldehyde  plant  and  certain  other  assets of Borden Chemicals and Plastic
Operating  Limited  Partnership in the third quarter of 2000 and the acquisition
of  East Central Wax in the fourth quarter of 2000 provided incremental sales of
approximately  $35,000.

These  increases  were  partially  offset  by  decreased volumes as slowdowns in
housing  starts  and  the  general  chemical  sector negatively impacted demand.
Sales  were  also  negatively  impacted  by  increased  competition  and foreign
currency  translation.  The  translation  impact  was  a result of a weakened US
dollar  versus  the  Canadian  dollar  in  2002  compared  to  2001.

EBITDA  increased  $46,548  or  81.7%  in  2001 principally due to a decrease of
$19,395  relating  to  plant  closure  costs and the absence of a $25,330 charge
taken in 2000 to exit certain long term raw material purchase contracts in order
to  take  advantage  of  more  favorable pricing opportunities.  Excluding these
charges,  EBITDA increased 1.9% as the impacts of decreasing raw material prices
in the second half of the year and the full year effect of the acquisitions more
than  offset  the  volume  declines  and  the  effects  of higher energy prices.


North  American  Performance  Resins
------------------------------------

North American Performance Resins sales increased $22,894 or 5.9% in 2001 due to
improved  mix  and  the  acquisition  of  a foundry resin business in the second
quarter  of  2001.  The  improved  mix  was the result of a larger proportion of
higher priced specialty oilfield product sales in 2001 due to increased drilling
activity.  The  increase  in  drilling  activity was driven by the significantly
higher  natural  gas  prices  in  the  first  quarter  of  the  year.  Partially
offsetting  these  increases  were decreased sales due to volume declines in the
foundry,  industrial resin and UV coatings businesses resulting from declines in
auto production, generally weaker industrial construction and electronics market
conditions  and  declines  in  fiber  optic  cable  demand.

EBITDA  decreased  by  $22,708  or  24.2% in 2001 driven by the volume decrease,
increased energy costs and manufacturing and SG&A costs related to the formation
and  integration  of  the  HA-International  joint  venture.

International
-------------

Sales  from  International  businesses  declined  $32,223 or 10.2% in 2001.  The
decline  was driven by volume declines in Latin America, Asia and Europe and the
negative  impact  of  foreign  currency translation due to a weaker US dollar in
2001  compared  to  2000 versus the Brazil Real, UK pound and Australian dollar.

EBITDA  declined  $9,329  in 2001 compared to 2000 principally due to the volume
declines  and  the foreign currency translation impact discussed above.  In both
2000  and  2001 EBITDA was negatively impacted by approximately $20,000 of plant
closure  costs  related  to  manufacturing  restructurings  in  the UK and Latin
America.

Corporate  and  Other
---------------------

Corporate expenses increased $19,283 to a loss of $79,346 in 2001.  The increase
reflects  settlement  and  curtailment charges of $16,300 in 2001 related to the
sale  of  Foods and the absence of a 2000 gain of $10,500 on the sale of certain
rights  to  harvest  shellfish.  A  gain of $4,400 on the sale of a common stock
equity investment held by the Company and the absence of 2000 pension settlement
and  curtailment charges of $8,858 related to the sale of Wise partially negated
these  declines.  Also in 2001, $7,763 of charges related to severance and other
charges  related to the corporate reorganization and headcount reduction program
contributed  to  the  decline.

NON-OPERATING  EXPENSES  AND  INCOME  TAX  EXPENSE:
---------------------------------------------------
<TABLE>
<CAPTION>

NON-OPERATING  EXPENSES

---------------------------------------------------------------------------------------------------
                                                 2002                2001                 2000
---------------------------------------------------------------------------------------------------
<S>                                              <C>                 <C>                    <C>

Interest expense                             $  47,315            $  51,613           $  62,654
Affiliated interest expense, net                 1,402               11,488              19,146
Other non-operating expense (income)            (5,989)               1,841             (26,370)
Investment write-downs and other
     charges                                       -                 27,000              67,969
                                              ---------           ----------           ---------
                                             $  42,728            $  91,942           $ 123,399
---------------------------------------------------------------------------------------------------
</TABLE>



2002  vs.  2001
---------------

Non-Operating  Expenses
-----------------------

Non-operating  expenses  decreased  $49,214  in the year ended December 31, 2002
compared  to  the year ended December 31, 2001.  Interest expense and affiliated
interest  expense  decreased  in  2002 by $4,298 and $10,086 respectively due to
lower  average  borrowing  levels.  Other non-operating income of $5,989 in 2002
included  a  gain  on an interest rate swap of $1,722, interest income of $2,269
and  a  $2,741  gain  on  the  repurchase  of  debt  in  the  open  market.  The
non-operating  loss  in  2001  of  $1,841  consisted  primarily of a $1,762 loss
incurred on an interest rate swap.  Also included in 2001 non-operating expenses
was  $27,000  of  investment  write-downs.  This  amount  consisted of a $10,000
charge  related  to the write-down of the Company's investment in BCPM (See Note
24  to  the Consolidated Financial Statements) and $17,000 of charges related to
the  write-down  of  a  receivable  and  preferred  stock  investment  in  WKI.

2001  vs.  2000

Non-operating  expenses decreased by $31,457 in the year ended December 31, 2001
compared  to  the year ended December 31, 2000.  Interest expense and affiliated
interest  expense  decreased  in 2001 by $11,041 and $7,658, respectively due to
lower  average  borrowings.  Other  non-operating  (income)  was $26,370 in 2000
versus an expense of $1,841 in 2001.  The 2000 income amount of $26,370 included
$12,884  of  interest  income,  $6,435  of  preferred  stock  dividends  from an
affiliate,  and  $4,902  of  a  gain  on  an  interest rate swap that settled in
September  2000.  Also  included  in  2000 non-operating expenses was $67,969 of
investment  write-downs  which  consisted  of  a  $20,000  charge related to the
write-down  of the Company's investment in BCPM (See Note 24 to the Consolidated
Financial  Statements)  and  $47,969  of  write-downs  of  the  preferred  stock
investment  in  WKI Holding Company, Inc. (WKI) (See Note 11 to the Consolidated
Financial  Statements).

<TABLE>
<CAPTION>

INCOME  TAX  (BENEFIT)  EXPENSE
---------------------------------------------------------------------------------------------------
                                             2002                   2001                     2000
---------------------------------------------------------------------------------------------------
<S>                                          <C>                    <C>                       <C>

Income tax (benefit)                     $  (2,262)             $  (30,833)              $ (12,401)
Effective tax rate.                             25%                     18%                     15%
---------------------------------------------------------------------------------------------------
</TABLE>


2002
----
The  2002  consolidated tax rate reflects a valuation allowance recorded against
the  deferred  benefit  of  certain  deferred interest expense deductions in the
amount  of  $16,672  that  is  no  longer  likely  to  be  utilized due to usage
limitations imposed by the Internal Revenue Code.  This expense is offset by the
reversal  of  a  $20,000 reserve that had been related to U.S. Federal and state
income  tax  audits  that  have  since  been  resolved.

2001
----
The  2001  consolidated  tax  rate reflects a write-down of the fixed assets and
non-deductible  goodwill  of  $31,692  related  to  a  melamine plant due to its
indefinite  shut-down.  The rate also reflects the impact of earnings related to
the  expected sale of a foreign business that are not expected to be permanently
reinvested in foreign locations and the inability to utilize foreign tax credits
associated  with  those  earnings  due to usage limitations.  These expenses are
offset  by  the  reversal  of  a  $14,388  reserve that had been related to U.S.
Federal  and  state  income  tax  audits  that  have  since  been  resolved.

2000
----
The 2000 income tax rate reflects a settlement reached with the Internal Revenue
Service  ("IRS") and the impact of usage limitations on foreign tax credits.  As
a  result  of  a  settlement  reached with the IRS, the Company recorded net tax
expense  of  $5,000  consisting  of  valuation  reserves recorded on foreign tax
credits  of  $30,000  that  are  no  longer likely to be utilized, substantially
offset  by  a $25,000 reduction of amounts established for tax issues related to
the divestiture of certain segments of the Company's business that are no longer
considered  necessary.  In addition, approximately $10,000 of income tax expense
was  recorded  on  foreign source income because related foreign tax credits are
not  expected  to  be  utilized  within  the  expiration  period.

CASH  FLOWS:
------------
<TABLE>
<CAPTION>

Cash provided by (used in):
---------------------------------------------------------------------------------------------------
<S>                                                  <C>                 <C>                  <C>
                                                     2002               2001                  2000
---------------------------------------------------------------------------------------------------
     Operating activities                       $    10,360          $   95,120          $  22,944
     Investing activities                            81,464             210,981           (195,746)
     Financing activities                          (101,716)           (308,403)             5,006
                                                  ----------           ---------          ---------
Net change in cash and cash
equivalents                                     $    (9,892)         $   (2,302)         $(167,796)
                                                  ==========           =========          ==========
</TABLE>


OPERATING
---------

2002  vs.  2001
---------------
Operating  activities  provided  cash  of $10,360 in 2002 compared to $95,120 of
cash  provided  in 2001.  The decrease was due to decreases in earnings adjusted
for  non-cash  items,  tax  refunds received and cash generated from net trading
capital.  In  2002 cash tax payments were $978 compared to a net refund received
of  $36,186 in 2001.  Cash from net trading capital decreased by $44,494 in 2002
due  to  higher  sales  volumes  and comparisons against an abnormally high 2001
level of inventory and receivable reductions.  In addition 2002 included $25,054
of  cash  restructuring  payments  which  was  an  increase  of  $846 from 2001.
Partially  offsetting  this  was a decrease in net cash interest paid in 2002 of
$23,330.


2001  vs.  2000
---------------
Operating  activities  provided  cash  of $95,120 in 2001 compared to $22,944 of
cash  provided  in  2000,  an  improvement  of  $72,176.  The  most  significant
components  of  this  improvement  are  cash  taxes  received of $36,186 in 2001
compared to cash taxes paid of $19,175 in 2000, increased cash flows in accounts
receivable  of  $59,348  due  to  improved  collection efforts and collection of
higher  raw  material costs passed through to customers in the first half of the
year,  the  absence  of  a  2000 payment of $25,330 to exit certain raw material
supply  contracts  and  improved cash flows in inventory of $27,193 due to lower
raw  material  costs  and  a  $12,302  cash  receipt  from Foods to assume the
liability for claims under certain employee benefit plans.  Partially offsetting
these  improvements were a $49,122 increase in outflows in trade payables due to
reduced  payment  terms  with  new raw material suppliers and lower raw material
costs,  increased cash restructuring payments in 2001 of  $15,861, increased net
interest  paid  of  $6,363  and  the  absence  of  2000  cash receipts from CCPC
Acquisition  Corp.  and  Wise  (see  below).

INVESTING

2002  vs.  2001
---------------
Net  cash  provided  by  investing  activities in 2002 was $81,464 compared with
$210,981  in  2001.  The  2002  cash  inflow  was  provided  by  selling  a note
receivable  from  Elmer's of $110,000 to the Company's parent, and selling other
assets  for  $10,237  to  unrelated  parties,  offset by capital expenditures of
$38,773.  In  comparison,  in  2001  cash  of  $160,888  was received related to
selling certain non-operating assets to the Company's parent and $96,977 of cash
was  received  primarily  from  the  sale  of  the common stock of Elmer's to an
affiliate.  These  inflows  were  offset by capital expenditures of $47,408.  In
2003,  the  company  expects  to  incur  capital  expenditures  of approximately
$45,000.

2001  vs.  2000
---------------
Investing  activities provided cash of $210,981 in 2001 compared to cash used of
$195,746  in  2000.  The  $406,727  improvement  is  primarily  due to increased
proceeds  from  the sale of assets of $150,978, the absence of 2000 acquisitions
for  $118,148,  increased proceeds from the divestiture of businesses of $86,031
and  reduced  capital  expenditures of $57,141.  The increased proceeds from the
sale  of  assets  were  due  to  the sale of loans receivable from affiliates at
managements  estimate of their fair value of $75,747, the sale of a common stock
equity  investment  held  by the Company for the market value of $64,141 and the
sale  of  land  and  other assets associated with closed plants of $14,000.  The
loans  to  affiliates  and $55,187 of the common stock equity investment held by
the Company were sold to the Company's parent.  The absence of acquisitions made
by  Consumer  Adhesives  and Chemical in 2000 improved cash flows by $118,148 in
2001.  Divestiture  proceeds  of  $96,977,  primarily  from the sale of Consumer
Adhesives, exceeded 2000 proceeds of $10,946, which relate primarily to the sale
of  the  printing  inks business.  Further contributing to the improvement was a
reduction  in  capital  expenditures  of  $57,141 primarily due to reduced plant
expansion  projects.

FINANCING  ACTIVITIES

2002  vs.  2001
---------------
In  2002  the  Company  had financing cash outflows of $101,716 compared to 2001
outflows  of  $308,403.  The  2002  outflows  are  primarily  due to the $66,165
increase  in restricted cash and the payment of a $31,581 note due to BCPM.  The
2001  outflows are primarily the result of repaying affiliated loans of $212,432
and  preferred  dividend  payments  of  $73,724.

The  Company  cancelled  its  preferred stock in 2001 and does not expect to pay
common  stock dividends during 2003.  Additionally, the Company expects to repay
outstanding  affiliated  borrowings  as  restricted  cash  balances  become
unrestricted  throughout  2003.

2001  vs.  2000
---------------
Financing  activities used cash of $308,403 in 2001 compared to cash provided of
$5,006  in  2000.  The  $313,409  increase  in cash used is primarily due to net
repayments  of affiliate loans of $212,432 in 2001 compared to net borrowings of
$86,703 in 2000, 2001 net short-term debt repayments of $41,763 compared to 2000
net short-term debt borrowings of $33,269 and a reduction in 2001 long-term debt
borrowings  of  $64,600.  Affiliate  activity  in 2001 is comprised primarily of
repayments  to  Foods  of $125,050 and BWHLLC of $73,355 and additional loans to
WKI of $18,900.  These increased uses were partially offset by reduced long-term
debt  repayments  of $86,000, lower 2001 common stock dividends paid of $13,000,
the absence of a $10,242 distribution to the Company's parent made in 2000 and a
2001  cash  capital  contribution  from  the  Company's  parent  of  $17,000.



LIQUIDITY  AND  CAPITAL  RESOURCES:
-----------------------------------

In  the  third  quarter of 2002, the Company entered into a new three-year asset
based  revolving  credit  facility  dated  September  23,  2002 (the "New Credit
Facility")  which  provides for a maximum borrowing of $175,000.  The New Credit
Facility  replaces  the  uncommitted letter of credit facility (discussed below)
and  the  prior $250,000 Credit Facility that expired on July 13, 2002.  The New
Credit  Facility is secured with inventory and accounts receivable in the United
States, Canada and the United Kingdom and a portion of property and equipment in
Canada and the United Kingdom.  The New Credit Facility contains restrictions on
dividends,  limitations  of  borrowings  from affiliates, limitations on capital
expenditures  ($65,000  in 2003) and payment of management fees ($5,000 per year
in  2003 and beyond) in addition to a minimum trailing twelve-month fixed charge
coverage  ratio  of  1.5  to 1.0 if aggregate availability is less than $25,000.

Under  the  uncommitted  letter  of  credit  facility, the Company provides cash
collateral  equivalent  to  101% of letters of credit outstanding, or $67,049 at
December  31,  2002.  This  amount  was  classified  as  restricted  cash on the
Consolidated Balance Sheet as of December 31, 2002.  The letters of credit under
this  facility  are in the process of being cancelled and reissued under the New
Credit Facility.  As the cash collateral becomes unrestricted, the Company plans
to  use  the  cash  to  repay  borrowings  from  Foods.

Currently,  the  Company has borrowed $84,680 from Foods  at an interest rate of
1.3125%  as  of  December  31,  2002.  When  all  letters  of  credit  under the
uncommitted  letter  of  credit  facility  have  been  cancelled, the New Credit
Facility  limits  the borrowings from affiliates to a maximum of $30,000 and the
reissued  letters  of  credit  ($66,385  at  December  31, 2002) will reduce the
borrowing  availability.  As  of  December  31,  2002,  the  maximum  borrowing
allowable  under  the  New  Credit  Facility  was $137,127 of which $123,836 was
unused  and  available.  Thus,  if the letters of credit had been reissued under
the  New Credit Facility and the newly unrestricted cash collateral were used to
pay  down  the  Foods debt, at December 31, 2002, the availability under the New
Credit Facility would have been $57,451 and additional allowable borrowings from
affiliates  would  have  been  $12,369.

Additional  credit  agreements  are  executed  by  the  Company's  international
locations.  As  of  December  31,  2002,  these  locations had credit facilities
totaling  $22,032.  Of this amount $17,614 (net of a $2,126 term loan and $2,292
of  other  draws  on  the lines of credit) was available to fund working capital
needs  and  capital  expenditures.

With  the  expiration  of  the  $250,000 Credit Facility in July 2002, Foods was
automatically  released  from  its  obligation  to  guarantee the payment of the
Company's  outstanding  publicly  held  debt.  On  March  1,  2002,  the Company
redeemed  its  investment  in  Consumer Adhesives preferred stock for a $110,000
note  receivable.  Subsequently,  the  note receivable was sold to the Company's
parent  for  cash of $110,000 plus accrued interest with the proceeds being used
to  repay  affiliated  debt.

In  the  fourth  quarter  of  2001,  the Company's parent contributed all of the
outstanding shares of preferred stock, plus accrued dividends, to the Company as
a  capital  contribution,  thereby  eliminating future annual preferred dividend
payments  of  $73,724.

In the fourth quarter of 2002, the Company repurchased $7,368 of its outstanding
publicly  held  bonds for $4,510 plus fees.  A $2,741 gain on the extinguishment
of  the  bonds  was  recognized.  The  Company and or affiliates of the Company,
including  entities  controlled  by  KKR, may in the future, depending on market
conditions,  purchase  additional  senior  unsecured notes of the Company in the
open  market  or  by  other  means.

In connection with the recent performance of equity markets in which assets
supporting the U.S. pension benefit obligations of the Company's defined benefit
plans are invested, the Company has projected the minimum annual funding
requirements imposed by Federal laws and regulations. In preparing the
projections, assumptions included an 8.5% annual rate of return on assets for
the years 2003 through 2006 and that there were no other changes in the law or
plan provisions. Minimum annual funding requirements under these assumptions
ranged from a low of $0 in 2003 to a high of $21,900 in 2006 with a total
funding requirement for the five years ended in 2007 of $65,100.


The Company has net operating loss carryforwards and alternative minimum tax
credits for U.S. Federal tax purposes which can offset $154,920 of future
taxable income. The Company, therefore, does not expect to have to pay any U.S.
Federal income taxes over the next several years.

The  Company's  planned  2003 capital expenditures are approximately $45,000 and
include  plans  to  continue to increase plant production capacity as necessary.
Capital  expenditures  will  be  financed  through operations and, if necessary,
available  lines  of  credit  or  borrowings  from  affiliates.

The  Company  expects  to  have  enough  liquidity  to  fund  working  capital
requirements  and  support  capital expenditures over the three year term of the
New  Credit  Facility  with  cash received from operations and amounts available
under  the  New  Credit  Facility  and  from  affiliates.  However,  there is no
assurance  that  borrowings from affiliates will be available in future periods.

A summary of the Company's obligations at December 31, 2002 is contained in Note
12  to  the  Consolidated  Financial  Statements.

RISK  MANAGEMENT

The  Company  enters  into  various  financial  instruments,  primarily to hedge
interest  rate  risk and foreign currency exchange risk. The Company also enters
into raw materials purchasing contracts and contracts with customers to mitigate
commodity  price  risks.

FOREIGN  EXCHANGE  RISK

In  2002  and 2001, international operations accounted for approximately 35% and
34%  of  the Company's sales. As a result, there is exposure to foreign exchange
risk  on transactions that are denominated in a currency other than the business
unit's  functional  currency.  Such  transactions  include  foreign  currency
denominated  imports  and  exports  of  raw  materials  and finished goods (both
intercompany  and  third  party), and loan payments (both intercompany and third
party).  In  all  cases,  the  functional currency is the unit's local currency.

It  is the Company's policy to reduce foreign currency cash flow exposure due to
exchange  rate  fluctuations  by  hedging  firmly  committed  foreign  currency
transactions  wherever  economically  feasible.  The  use  of forward and option
contracts  protects  cash flows against unfavorable movements in exchange rates,
to  the  extent of the amount under contract. The Company does not hedge foreign
currency  exposure  in  a  manner  that  would  entirely eliminate the effect of
changes  in  foreign  currency  exchange  rates on net income and cash flow. The
Company  does  not  speculate  in  foreign  currency  and does not hedge foreign
currency  translation  or  foreign  currency  net  assets  and  liabilities. The
counterparties  to  the  forward  contracts  are  financial  institutions  with
investment  grade  credit  ratings.

Foreign  exchange  risk  is  also mitigated because the Company operates in many
foreign  countries,  reducing  the concentration of risk in any one currency. In
addition,  foreign  operations  have  limited  imports and exports, reducing the
potential  impact  of  foreign  currency  exchange rate fluctuations. With other
factors being equal, such as the performance of individual foreign economies, an
average  10%  foreign exchange increase or decrease in any one country would not
materially  impact operating results or cash flow. Although considered unlikely,
an  average  10%  foreign  exchange  increase  or  decrease in all countries may
materially  impact  operating  results  of  the  Company.

In  accordance  with  current accounting standards, the Company recognizes gains
and  losses  arising  from  forward  and  option  contracts on a quarterly basis
through  the  Consolidated  Statement  of  Operations.

A  summary  of  forward currency and option contracts outstanding as of December
31,  2002 and 2001 follows. Fair values are determined from quoted market prices
at  December  31,  2002  and  2001.
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------------------
                                              2002                                                      2001
                            ---------------------------------------------------      ---------------------------------------------
                            AVERAGE        AVERAGE                                   AVERAGE       AVERAGE
                            DAYS           CONTRACT     FORWARD   FAIR VALUE         DAYS          CONTRACT    FORWARD   FAIR VALUE
                            TO MATURITY    RATE         POSITION  LOSS               TO MATURITY   RATE        POSITION  LOSS
                            -----------    --------     --------  ----------         -----------   ---------   --------  ----------
<S>                            <C>          <C>          <C>       <C>                <C>            <C>         <C>       <C>
CURRENCY TO SELL
 FOR U.S. DOLLARS
-----------------

British Pound                   31           1.60       $ 36,916  $ (231)               59           1.45    $  50,987   $ (87)

CURRENCY TO SELL
FOR CDN DOLLARS
-----------------
British Pound                   31           2.51       $ 23,163  $ (171)                -             -          -          -
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>


INTEREST  RATE  RISK

The  Company has utilized interest rate swaps to lower funding costs or to alter
interest  rate exposures between fixed and floating rates on long-term debt. The
Company  does  not enter into speculative swaps or other financial contracts. As
of  December  31,  2002  there  were  no interest rate swaps outstanding.  As of
December  31, 2001, one interest rate swap was outstanding with a notional value
of  $24,286.

Fair  values  of the swaps are independently provided using estimated mid-market
levels.  Under  interest  rate  swaps,  the Company agrees with other parties to
exchange,  at  specified  intervals,  the  difference between the fixed rate and
floating  rate  interest  amounts calculated by reference to the agreed notional
principal  amount.  The  Company  paid 13.7% and received 1.86% in 2002 and paid
13.7%  and  received 4.5% in 2001. The remaining outstanding swap as of December
31,  2001  matured  on  December  1,  2002.

The  interest  rate on most debt agreements is fixed. A 10% increase or decrease
in  the  interest  rate of the variable debt agreements would have an immaterial
effect  on  the  Company's  net  income. The fair value of publicly held debt is
based on the price at which the bonds are trading at December 31, 2002 and 2001.
All  other  debt fair values are determined from quoted market interest rates at
December  31,  2002  and  2001.

A  summary  of  the  Company's outstanding debt as of December 31, 2002 and 2001
follows:
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------------------
                                                 2002                                                        2001
                        ------------------------------------------------                  ----------------------------------------
                                                Weighted                                                    Weighted
                                                Average         Fair                                        Average         Fair
Year                             Debt           Interest Rate   Value                      Debt             Interest Rate   Value
------------------------------------------------------------------------                  ----------------------------------------
<S>                             <C>               <C>             <C>                       <C>               <C>              <C>

2002                        $    -                           $     -                     $  3,078             8.3%        $ 3,078
2003                            2,779            10.7%           2,779                       -                -              -
2004                              607            13.8              602                       -                -              -
2005                              607            13.8              602                       -                -              -
2006                              300            13.8              298                      3,356             13.3          4,640
2007                               11            14.3               11                        -               -              -
2008 and thereafter           521,762             8.5          340,756                    529,141              8.5        361,281
                             ---------                         -------                    --------                       --------
                            $ 526,066                        $ 345,048                   $535,575                         $368,999
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>


The  Company  does  not  use  derivative  financial  instruments  in  investment
portfolios.  Cash  equivalent  investments are placed with instruments that meet
credit  quality  standards. These standards are established within the Company's
investment policies, which also limit the exposure to any one issue. At December
31,  2002,  the  Company  had  $70,133  invested primarily in time deposits with
average  maturity  periods of 7 days and average rates at 1.2%.  At December 31,
2001,  the  Company  had $6,920 invested primarily in marketable securities with
average maturity periods of 43 days and average rates of 6.4%.  Due to the short
maturity  of the Company's cash equivalents and restricted cash investments, the
carrying  value  on  these  investments approximates fair value and the interest
rate  risk is not significant. A 10% increase or decrease in interest returns on
invested  cash  would  have an immaterial effect on the Company's net income and
cash  flow  at  December  31,  2002  and  2001.

COMMODITY  RISK

The  Company  is  exposed to price risks associated with raw material purchases,
most  significantly  with  methanol,  phenol  and  urea.  For  the commodity raw
materials,  the  Company  has purchase contracts, with periodic price adjustment
provisions.  In 2002, suppliers were committed under contract to provide 100% of
the  Company's  estimated methanol and urea requirements.  Phenol suppliers were
committed  to  providing  up  to 100% of estimated requirements and provided the
flexibility  to  purchase  a certain percentage of the Company needs in the spot
market.  For 2003, the Company has negotiated stronger competitive price clauses
in  certain contracts, which will allow it to buy outside the contract if market
pricing  falls  below  contract pricing and other contracts have min-max monthly
volume  commitments  which  will  allow the Company to take further advantage of
spot  pricing.  The  commodity  risk  also  is moderated through use of customer
contracts  with  selling price provisions that are indexed to publicly available
indices  for these commodity raw materials as discussed on pages 15 and 16.  Any
commodity  futures  that the Company may enter into are approved by the Board of
Directors.

The  Company  has  entered  into  a  long-term  contractual arrangement with the
leading  global  melamine  crystal  producer  to  supply a minimum of 70% of the
Company's  worldwide  melamine crystal requirements.  The melamine crystal to be
purchased  under the agreement will be sourced from numerous supplier production
sites  and  the  temporary  or  permanent  loss of any individual site would not
likely  have  a  material adverse impact on the Company's ability to satisfy its
melamine  crystal  needs.

In  the  fourth  quarter  of  2000,  the  Company entered into fixed rate, fixed
quantity contracts to secure a portion of future natural gas usage at certain of
the  Company's  facilities.  The  contracts were entered into to partially hedge
the  Company's risk associated with natural gas price fluctuations in peak usage
months through March 2003.  Gas purchases under these contracts totaled $671 and
$853  in  2002 and 2001, with $402 and $1,073 future commitments at December 31,
2002  and  2001,  respectively.

Additionally,  the  Company  expanded its natural gas hedging activities in June
2001  to hedge a portion of natural gas purchases for all of North America.  The
Company  entered  into  futures  contracts with varying settlement dates through
November  2002 to purchase natural gas.  The contracts are settled for cash each
month  based  on the closing market price on the last day the contract trades on
the  New  York  Mercantile  Exchange.  Commitments settled under these contracts
totaled $1,210 and $1,716 in 2002 and 2001, respectively and related losses were
$264  and  $610  in 2002 and 2001.  There were no future commitments under these
contracts  at  December  31, 2002 and $520 of future commitments at December 31,
2001.

Gains and losses on commodity futures contracts are recognized each month as gas
is  used.  Future  commitments  are  marked to market on a quarterly basis.  The
Company  also  recorded a gain of $16 and a loss $545 for the difference between
the  fair value and carrying value of future natural gas commitments at December
31,  2002  and  2001,  respectively.

EQUITY  PRICE  RISK

At  December 31, 2001, the Company held a preferred stock investment of $110,000
in  Consumer  Adhesives.  Subsequently, on March 1, 2002, the Consumer Adhesives
preferred  stock  was  redeemed  for  a  $110,000  note receivable from Consumer
Adhesives.  On  March  12,  2002,  the note receivable was sold to the Company's
parent  for cash of $110,000 plus accrued interest.  During 2001, a common stock
equity investment of the Company was sold for $64,141.  Of the $64,141, sales to
third-party  investors  totaling $8,954 were made in 2001 resulting in a pre-tax
gain  of  $3,772 ($2,780 after-tax).  The remaining $55,187 of the sale was made
to  the  Company's parent as part of the Corporate Reorganization (see Note 5 to
the  Consolidated  Financial  Statements).  In  addition,  the remaining $10,000
investment  in  preferred  stock  of  WKI  was  written-off  during the year and
transferred  to  the  Company's  parent  at  its  fair  value.

The  Company  reviews  the  carrying  value  of  investments  in accordance with
existing  accounting  guidance  that requires investments to be adjusted to fair
value  if  the decline in value is considered to be "other than temporary" based
on certain criteria.  The Company recorded investment write downs of $10,000 and
$47,969  in  2001  and  2000,  respectively.

A summary of investments as of December 31, 2002 and 2001 follows. Fair value is
based  on  the  market stock price as of December 31, 2002 and 2001 for publicly
traded common stock.  Fair value for other investments is based on other similar
financial  instruments.


<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------
                                              2002                                2001
                                     --------------------------       --------------------------
                            DATE          CARRYING          FAIR         CARRYING          FAIR
DESCRIPTION                 ACQUIRED      VALUE             VALUE        VALUE             VALUE
-----------                 --------      --------          -----       --------         ----------

<S>                          <C>            <C>               <C>          <C>              <C>

Cost method securities      8/13/01          -                -        $   110,000      $  110,000
---------------------------------------------------------------------------------------------------------
</TABLE>


Readers  are  cautioned  that  forward-looking  statements  contained  under the
heading  of  "Risk Management" should be read in conjunction with the disclosure
under  the  heading:  "Forward-Looking  and  Cautionary  Statements".

RECENTLY  ISSUED  ACCOUNTING  STANDARDS
---------------------------------------

In July 2001, the Financial Accounting Standards Board ("FASB") issued Statement
of Financial Accounting Standards ("SFAS") No. 143, "Accounting for Asset
Retirement Obligations," which addresses financial accounting and reporting for
obligations associated with the retirement of tangible long-lived assets and the
associated asset retirement costs. Under this Statement, an asset retirement
obligation is recognized at its fair value in the period in which it is
incurred. Asset retirement costs are capitalized as part of the carrying amount
of the long-lived asset and a related amortization expense is recognized in
future periods. This Statement is effective for the Company for financial
statements issued for fiscal years beginning after January 1, 2003. The Company
does not expect implementation of SFAS No. 143 to have a significant impact on
its result of operation or financial condition.

In  January  2002,  the  Company  adopted  SFAS  No.  142,  "Goodwill  and Other
Intangible  Assets".  SFAS  No.  142  specifies  that  goodwill  and  certain
intangibles  with indefinite lives no longer be amortized but instead be subject
to  periodic  impairment  testing.  (See  Note  6  to the Consolidated Financial
Statements).

In May 2002, the FASB issued SFAS No. 145, "Rescission of FASB Statements No. 4,
44  and 64, Amendment of FASB Statement No. 13, and Technical Correction".  This
statement  rescinds  the  aforementioned Statements and amends SFAS No. 13.  The
provisions  of  this Statement related to SFAS No. 4 "Reporting Gains and Losses
from  Extinguishment of Debt" are effective for fiscal years beginning after May
15,  2002 but early application is encouraged.  The Company has adopted SFAS No.
145 and has reported a gain related to the repurchase of its publicly held bonds
(See  Note  12  to  the  Consolidated  Financial  Statements).

In June 2002, the FASB issued SFAS No. 146, "Accounting for Costs Associated
with Exit or Disposal Activities." This Statement nullifies Emerging Issue Task
Force Issue No. 94-3, "Liability Recognition for Certain Employee Termination
Benefits and Other Costs to Exit an Activity (including Certain Costs Incurred
in a Restructuring)." The principle difference between this Statement and EITF
94-3 relates to the requirements for recognition of the liability for costs
associated with exit or disposal activities. Specifically, the liability for a
cost associated with an exit or disposal activity is no longer recognized at the
commitment date. Instead, the liability is recognized when the liability is
incurred as defined by FASB Concept Statement No. 6, Elements of Financial
Statements. The provisions of this Statement are effective for exit or disposal
activities initiated after December 31, 2002, with early application encouraged.
Retroactive application of this Statement is prohibited. Any exit and disposal
activities initiated under EITF 94-3 shall continue to be accounted for under
the provisions of this EITF. The Company will follow the guidelines set forth in
SFAS No. 146.


In November 2002, the FASB issued Interpretation No. 45, "Guarantor's Accounting
and  Disclosure  Requirements  for  Guarantees, Including Indirect Guarantees of
Indebtedness  of Others" ("FIN 45").  FIN 45 requires a guarantor to recognize a
liability,  at the inception of the guarantee, for the fair value of obligations
it  has  undertaken  in  issuing  the  guarantee  and also include more detailed
disclosures  with  respect  to  guarantees.  FIN  45 is effective for guarantees
issued  or modified after December 31, 2002.  The disclosure requirements of FIN
45  are  effective for financial statements for interim or annual periods ending
after  December  15,  2002.  The Company has provided additional disclosure with
respect  to  guarantees  in Note 23 to the Consolidated Financial Statements and
has  not  yet  determined if the adoption of the liability recognition provision
will  have  any  material  impact  on  the  Company's  results  of operations or
financial  condition.

In  December  2002,  the  FASB  issued SFAS No. 148, "Accounting for Stock-Based
Compensation  -  Transition  and  Disclosure". SFAS No. 148 provides alternative
methods  of  transition for a voluntary change to the fair value based method of
accounting  for  stock-based  employee  compensation  and  amends the disclosure
requirements  of  SFAS  No. 123.  The transition provisions of this SFAS No. 148
are  effective for fiscal years ending after December 15, 2002.  The Company has
elected  not  to voluntarily change to the fair value based method of accounting
for  stock-based  compensation  at  this  time.  The  Company  has  included the
additional  disclosure  requirements  in  Notes  3  and  17  to the Consolidated
Financial  Statements.

In January 2003, the FASB issued Interpretation No. 46, "Consolidation of
Variable Interest Entities" ("FIN 46") to expand upon and strengthen existing
accounting guidance that addresses when a company should include in its
financial statements, the assets, liabilities and activities of another entity.
FIN No. 46 requires existing unconsolidated variable interest entities to be
consolidated by their primary beneficiaries if the entities do not effectively
disperse risks among parties involved. The consolidation requirements of FIN 46
apply immediately to variable interest entities created after January 31, 2003
and to older entities in the first fiscal year or interim period beginning after
June 15, 2003. The Company does not expect the implementation of FIN 46 to have
a significant impact on its results of operations and financial condition.

FORWARD-LOOKING  AND  CAUTIONARY  STATEMENTS
--------------------------------------------

The  Company  and  its  officers  may,  from  time to time, make written or oral
statements regarding the future performance of the Company, including statements
contained  in  this  report  and  the  Company's  other  reports  filed with the
Securities  and  Exchange  Commission.  Investors  should  be  aware  that these
statements, which may include words such as "expects" or "outlook", are based on
currently  available  financial,  economic,  and competitive data and on current
business  plans.  Such  statements are inherently uncertain and investors should
recognize  that  events  could  cause  the  Company's  actual  results to differ
materially  from  those  projected  in  forward-looking statements made by or on
behalf  of the Company.  Such risks and uncertainties are primarily in the areas
of  results  of operations by business unit, including decreases in the level of
housing  starts  and  auto  builds,  the  impact of imports of wood products and
furniture  to  the United States, and the impact of raw material price increases
on  the  Company's  operations,  liquidity, legal and environmental liabilities.








ITEM  7A:   QUANTITATIVE  AND  QUALITATIVE  DISCLOSURES  ABOUT  MARKET  RISK
---------   ------------------------------------------------------------------

Refer  to  the  "Risk  Management"  section  included  in  Item 7 - Management's
Discussion  and  Analysis  of  Financial  Condition  and  Results  of Operation.


















































































<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------------------
ITEM  8.   FINANCIAL  STATEMENTS  AND  SUPPLEMENTARY  DATA
--------   -----------------------------------------------
CONSOLIDATED  STATEMENTS  OF  OPERATIONS
BORDEN  CHEMICAL,  INC.

                                                                                            Year ended December 31,
(In thousands, except per share data)                                             2002                2001            2000
----------------------------------------------------------------------------------------------------------------------------------
<S>                                                                              <C>                 <C>            <C>
  Net sales                                                                 $  1,247,885         $ 1,372,141     $  1,377,845
  Cost of goods sold                                                             968,657           1,060,642        1,056,804
                                                                             --------------       --------------   ---------------

  Gross margin                                                                   279,228             311,499          321,041
                                                                             --------------       --------------   ---------------

  Distribution expense                                                            61,927              63,929           63,776
  Marketing expense                                                               42,503              42,046           46,191
  General & administrative expense                                               109,237             127,967          131,382
  Loss (gain) on sale of assets                                                      282              (3,772)         (10,095)
  Loss on divestiture of businesses                                                  -                 2,303              945
  Business realignment expense and impairments                                    19,699             126,408           38,100
  Other operating expense                                                         11,872              28,113           12,003
                                                                             --------------       --------------   ---------------

  Operating income (loss)                                                         33,708             (75,495)          38,739
                                                                             --------------       --------------   ---------------

  Interest expense                                                                47,315              51,613           62,654
  Affiliated interest expense, net of affiliated interest
       income of $455, $3,050 and $1,817, respectively                             1,402              11,488           19,146
  Other non-operating (income) expense                                            (5,989)              1,841          (26,370)
  Investment write-downs and other charges                                          -                 27,000           67,969
                                                                             --------------       --------------   ---------------

  (Loss) from continuing operations
       before income tax                                                          (9,020)           (167,437)         (84,660)
  Income tax (benefit) expense                                                    (2,262)            (30,833)         (12,401)
                                                                             --------------       --------------   ---------------

  Loss from continuing operations                                                 (6,758)           (136,604)         (72,259)
                                                                             --------------       --------------   ---------------

  Discontinued operations:
       Income from operations, net of tax                                           -                 11,804           13,233
       Gain on disposal, net of tax                                                 -                    -             93,000
                                                                             --------------       --------------   ---------------

  (Loss) income before cumulative effect of change in
       accounting principle                                                       (6,758)           (124,800)          33,974

  Cumulative effect of change in accounting principle                            (29,825)                -               -
                                                                             --------------       --------------   ---------------

  Net (loss) income                                                              (36,583)           (124,800)          33,974

  Preferred stock dividends                                                         -                (61,846)         (73,724)
                                                                             --------------       --------------   ---------------

  Net loss applicable to common stock                                       $    (36,583)        $  (186,646)    $    (39,750)
                                                                             ==============       ==============   ===============
</TABLE>
























<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------------------
CONSOLIDATED  STATEMENTS  OF  OPERATIONS
(CONTINUED)
BORDEN  CHEMICAL,  INC.

                                                                                         Year ended December 31,
(In thousands, except per share data)                                  2002                         2001                    2000
----------------------------------------------------------------------------------------------------------------------------------
<S>                                                                    <C>                           <C>                     <C>
  Basic and Diluted Per Share Data
------------------------------------
  Loss from continuing operations                                 $   (0.03)                    $   (0.69)             $   (0.36)
  Discontinued operations:
       Income from operations, net of tax                               -                            0.06                   0.06
       Gain on disposal, net of tax                                     -                             -                     0.47
                                                                  -----------                    -----------            ----------

  (Loss) income before cumulative effect of change
    in accounting principle                                           (0.03)                        (0.63)                  0.17

  Cumulative effect of change in accounting principle                 (0.15)                          -                       -
                                                                  -----------                    -----------            ----------

  Net (loss) income                                                   (0.18)                        (0.63)                  0.17
  Preferred stock dividends                                             -                           (0.31)                 (0.37)
                                                                  -----------                    -----------            ----------

  Net loss applicable to common stock                             $   (0.18)                    $   (0.94)             $   (0.20)
                                                                  ===========                    ===========            ==========

  Dividends per common share                                     $      -                       $    0.18              $    0.31
  Dividends per preferred share                                  $      -                       $    2.52              $    3.00

  Average number of common shares outstanding
       during the period - basic                                    200,458                       198,997                198,975

  Average number of common shares outstanding                       200,458                       198,997                198,975
       during the period - dilutive
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
See  Notes  to  Consolidated  Financial  Statements











































<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------------------
CONSOLIDATED  BALANCE  SHEETS
BORDEN  CHEMICAL,  INC.

(In  thousands)

                                                                      December 31,                              December 31,
ASSETS                                                                  2002                                         2001
----------------------------------------------------------------------------------------------------------------------------------
<S>                                                                     <C>                                                <C>
CURRENT ASSETS
  Cash and equivalents                                             $   14,740                                        $  24,632
  Restricted cash                                                      67,049                                              -
  Accounts receivable (less allowance for doubtful
       accounts of $12,219 in 2002 and $16,659 in 2001)               170,822                                          164,137
  Accounts receivable from affiliates                                   5,840                                            7,077
  Inventories:
       Finished and in-process goods                                   45,178                                           54,184
       Raw materials and supplies                                      41,079                                           38,050
  Deferred income taxes                                                28,869                                           27,396
  Other current assets                                                 13,232                                            9,231
                                                                   ---------------                                ----------------
                                                                      386,809                                          324,707
                                                                   ---------------                                ----------------

INVESTMENTS AND OTHER ASSETS
  Investments in affiliates                                              -                                             110,000
  Deferred income taxes                                               118,368                                          125,764
  Other assets                                                         19,615                                           24,604
                                                                   ---------------                                ----------------
                                                                      137,983                                          260,368
                                                                   ---------------                                ----------------

PROPERTY AND EQUIPMENT
  Land                                                                 31,964                                           30,124
  Buildings                                                            98,313                                           98,309
  Machinery and equipment                                             649,782                                          652,076
                                                                   ---------------                                ----------------
                                                                      780,059                                          780,509
  Less accumulated depreciation                                      (340,321)                                        (322,952)
                                                                   ---------------                                ----------------
                                                                      439,738                                          457,557

GOODWILL                                                               39,640                                           71,399
OTHER INTANGIBLE ASSETS                                                 7,610                                            9,247
                                                                   ---------------                                ----------------

TOTAL ASSETS                                                       $1,011,780                                       $1,123,278
                                                                   ===============                                ================
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>


See  Notes  to  Consolidated  Financial  Statements

































<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------------------
CONSOLIDATED  BALANCE  SHEETS
BORDEN  CHEMICAL,  INC.

(In  thousands,  except  share  data)

                                                                                December 31,                       December 31,
LIABILITIES AND SHAREHOLDERS' (DEFICIT) EQUITY                                    2002                                 2001
----------------------------------------------------------------------------------------------------------------------------------
<S>                                                                                <C>                              <C>
CURRENT LIABILITIES
  Accounts and drafts payable                                                 $   113,549                          $   124,690
  Accounts payable to affiliates                                                    2,580                                  750
  Debt payable within one year                                                      2,779                                3,078
  Loans payable to affiliates                                                      84,680                               78,550
  Note payable to unconsolidated subsidiary                                          -                                  34,181
  Other current liabilities                                                        97,932                              106,958
                                                                               --------------                     ----------------
                                                                                  301,520                              348,207
                                                                               --------------                     ----------------

OTHER LIABILITIES
  Long-term debt                                                                  523,287                              532,497
  Non-pension post-employment benefit obligations                                 145,384                              150,916
  Other long-term liabilities                                                     202,482                              188,963
                                                                               --------------                     ----------------
                                                                                  871,153                              872,376
                                                                               --------------                     ----------------
COMMITMENTS AND CONTINGENCIES (SEE NOTE 24)

SHAREHOLDERS' (DEFICIT) EQUITY
  Common stock - $0.01 par value: authorized 300,000,000 shares,
       Issued 200,923,628 and 199,121,749 shares in 2002 and
       2001, respectively                                                           2,009                                1,990
  Paid in capital                                                               1,172,344                            1,106,789
  Receivable from parent                                                         (463,516)                            (404,817)
  Deferred compensation                                                            (2,679)                                -
  Accumulated other comprehensive income                                         (165,637)                            (134,436)
  Accumulated deficit                                                            (703,414)                            (666,831)
                                                                               --------------                     ----------------
                                                                                 (160,893)                             (97,305)
                                                                               --------------                     ----------------

TOTAL LIABILITIES AND SHAREHOLDERS' (DEFICIT) EQUITY                          $ 1,011,780                          $ 1,123,278
                                                                               ===============                    ================
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>


See  Notes  to  Consolidated  Financial  Statements




































<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------------------
CONSOLIDATED  STATEMENTS  OF  CASH  FLOWS
BORDEN  CHEMICAL,  INC.

                                                                                       Year ended December 31,
(In thousands)                                                           2002                    2001                       2000
----------------------------------------------------------------------------------------------------------------------------------
<S>                                                                       <C>                    <C>                         <C>
CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES
  Net (loss) income                                                $   (36,583)              $   (124,800)             $  33,974
  Adjustments to reconcile net income to net
   cash from (used in) operating activities:
     (Gain) on disposal of discontinued operations, net of tax            -                          -                   (93,000)
      Loss on divestiture of businesses                                   -                         2,303                    945
      Loss (gain) on the sale of assets                                    282                     (3,772)               (10,095)
      Deferred tax provision (benefit)                                  16,023                    (25,883)                18,826
      Depreciation and amortization                                     47,947                     59,361                 55,691
      Deferred compensation expense                                        892                        -                      -
      Business realignment,impairments and other                        19,699                    126,408                 38,100
      Environmental remediation reserve                                   -                        19,028                    -
      Unrealized (gain) loss on interest rate swap                      (1,722)                     1,762                 (4,902)
      Investment write-downs and other charges                          29,825                     27,000                 67,969
  Net change in assets and liabilities:
      Trade receivables                                                (12,596)                    31,698                (27,650)
      Inventories                                                        2,552                     14,679                (12,514)
      Trade payables                                                    (8,303)                   (20,230)                28,892
      Income taxes                                                     (21,780)                    44,130                (47,922)
      Other assets                                                      (2,571)                   (71,103)                21,516
      Other liabilities                                                (23,305)                    14,519                (37,812)
  Cash provided (used) by discontinued operations                          -                           20                 (9,074)
                                                                      -----------                -------------          ----------
                                                                        10,360                     95,120                 22,944
                                                                      -----------                -------------          ----------

CASH FLOWS FROM (USED IN) INVESTING ACTIVITIES
  Capital expenditures                                                 (38,773)                   (47,408)              (104,549)
  Proceeds from the divestiture of businesses                             -                        96,977                 10,946
  Purchase of businesses                                                  -                           -                 (118,148)
  Proceeds from the sale of assets                                      10,237                    160,888                  9,910
  Proceeds from sale of note receivable to an affiliate                110,000                        -                     -
  Collection (purchase) of affiliate's receivables                        -                           500                   (500)
  Return from affiliate, net                                              -                            24                  6,595
                                                                      -----------                -------------          ----------
                                                                        81,464                    210,981               (195,746)
                                                                      -----------                -------------          ----------

CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES
  Net short-term debt borrowings (repayments)                            1,255                    (41,763)                33,269
  Borrowings of long-term debt                                            -                        57,400                122,000
  Repayments of long-term debt                                         (10,764)                   (54,000)              (140,000)
  Affiliated borrowings/receipts (repayments/loans)                      6,130                   (212,432)                86,703
  Payment of note payable to unconsolidated subsidiary                 (31,581)                       -                       -
  Increase in restricted cash                                          (66,165)                      (884)                    -
  Interest received from parent                                            -                       48,578                 48,578
  Common stock dividends paid                                              -                      (48,578)               (61,578)
  Preferred stock dividends paid                                           -                      (73,724)               (73,724)
  Repurchases net of sale of common stock to management                   (591)                       -                       -
  Capital contribution from (distribution to) parent                       -                       17,000                (10,242)
                                                                      -----------                -------------          ----------
                                                                      (101,716)                  (308,403)                 5,006
                                                                      -----------                -------------          ----------
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>























<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------------------
CONSOLIDATED  STATEMENTS  OF  CASH  FLOWS  (CONTINUED)
BORDEN  CHEMICAL,  INC.

                                                                                       Year ended December 31,
(In thousands)                                                                    2002                 2001             2000
----------------------------------------------------------------------------------------------------------------------------------
<S>                                                                               <C>                   <C>               <C>
  (Decrease) in cash and equivalents                                         $   (9,892)            $   (2,302)     $ (167,796)
  Cash and equivalents at beginning
      of year                                                                    24,632                 26,934         194,730
                                                                              ----------             -----------      ------------
  Cash and equivalents at end
      of year                                                               $    14,740             $   24,632      $   26,934
                                                                              ==========             ===========      ============


SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
  Cash paid (received):
      Interest, net                                                         $    46,928             $   70,258      $   63,895
      Income taxes, net                                                             978                (36,186)         19,175
  Non-cash activity:
        Capital contribution by parent                                           24,440                 21,038          44,352
        Contribution of preferred stock and accrued dividend by parent             -                   620,922             -
        Accrued dividends on investment in affiliate                               -                      -              6,435
        Distribution of net assets of infrastructure management
           services business to the Company's parent                               -                      -              6,035
        Reclassification of minimum pension liability adjustment
           (to)/from shareholders' equity                                       (17,075)               (66,580)          1,779
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

See  Notes  to  Consolidated  Financial  Statements











































<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------------------
CONSOLIDATED  STATEMENTS  OF  SHAREHOLDERS'  (DEFICIT)  EQUITY
BORDEN  CHEMICAL,  INC.

(In  thousands)
----------------------------------------------------------------------------------------------------------------------------------
                                                                                               Accumulated
                                              Preferred     Common     Paid-in     Receivable     Other     Accumulated
                                                Stock        Stock     Capital       from     Comprehensive   Deficit      Total
                                                                                     Parent       Income
----------------------------------------------------------------------------------------------------------------------------------
<S>                                              <C>           <C>       <C>         <C>         <C>           <C>           <C>
Balance, December 31, 1999                  $ 614,369     $ 1,990      $ 355,722  $ (414,937)  $(52,498)   $(440,435)    $64,211
----------------------------------------------------------------------------------------------------------------------------------
Net income                                                                                                    33,974      33,974

Translation adjustments and other                                                                (9,558)                  (9,558)

Minimum pension liability (net of $958 tax)                                                       1,779                    1,779
                                                                                                                         ---------

COMPREHENSIVE INCOME                                                                                                      26,195
                                                                                                                         ---------

Preferred stock dividends                                                                                    (73,724)    (73,724)

Common stock dividends                                                   (61,578)                                        (61,578)

Other distributions                                                      (16,277)                                        (16,277)

Interest accrued on notes from parent (net of $17,488 tax)                31,090                                          31,090

Capital contribution from parent                                          44,352                                          44,352
----------------------------------------------------------------------------------------------------------------------------------

Balance, December 31, 2000                  $ 614,369     $ 1,990      $ 353,309  $(414,937)   $(60,277)   $(480,185)    $14,269
----------------------------------------------------------------------------------------------------------------------------------
Net income                                                                                                  (124,800)   (124,800)

Translation adjustments and other                                                                (6,849)                  (6,849)

Cumulative effect of change in accounting principle (net of $1,900 tax)                          (3,300)                  (3,300)

Derivative activity (net of $1,300 tax)                                                           2,570                    2,570

Minimum pension liability (net of $36,090 tax)                                                  (66,580)                 (66,580)
                                                                                                                         ---------

COMPREHENSIVE INCOME                                                                                                    (198,959)
                                                                                                                         ---------

Preferred stock dividends                                                                                    (61,846)    (61,846)

Common stock dividends                                                   (36,434)                                        (36,434)

Interest accrued on notes from parent (net of $13,784 tax)                24,674     10,120                               34,794

Gain on Consumer Adhesives Sale to affiliate (net of $37,428 tax)         94,847                                          94,847

Gain on sale of common stock equity investment to
     affiliate (net of $5,600 tax)                                        10,197                                          10,197

Common stock and warrants issued to management                             1,236                                           1,236

Capital contribution from parent of
    preferred stock and accrued dividend      (614,369)                  620,922                                           6,553

Capital contribution from parent                                          38,038                                          38,038
----------------------------------------------------------------------------------------------------------------------------------
Balance, December 31, 2001                  $    -          $1,990    $1,106,789  $(404,817)   $(134,436)  $(666,831)   $(97,305)
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

See  Notes  to  Consolidated  Financial  Statements












<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------------------
CONSOLIDATED  STATEMENTS  OF  SHAREHOLDERS'  (DEFICIT)  EQUITY
BORDEN  CHEMICAL,  INC.

(In  thousands)
----------------------------------------------------------------------------------------------------------------------------------
                                                                                      Accumulated
                                        Common    Paid-in     Receivable                 Other          Accumulated
                                         Stock    Capital      from       Deferred   Comprehensive       Deficit        Total
                                                               Parent   Compensation    Income
----------------------------------------------------------------------------------------------------------------------------------
Balance, December 31, 2001             $  1,990  $ 1,106,789  $(404,817)   $  -        $  (134,436)    $ (666,831)    $ (97,305)
----------------------------------------------------------------------------------------------------------------------------------
<S>                                      <C>        <C>           <C>         <C>         <C>               <C>           <C>
Net income                                                                                                (36,583)      (36,583)

Translation adjustments and other                                                          (14,856)                     (14,856)

Derivative activity (net of $401 tax)                                                          730                          730

Minimum pension liability (net of $9,194 tax)                                              (17,075)                     (17,075)
                                                                                                                      ------------

COMPREHENSIVE INCOME                                                                                                    (67,784)
                                                                                                                      ------------

Repurchases of common stock from management  (1)      (1,341)                                                            (1,342)

Restricted stock issued to management        16        3,555                   (3,571)                                      -

Interest accrued on notes from parent
     (net of tax $20,545)                             38,154    (58,699)                                                (20,545)

Compensation expense on restricted stock                                          892                                       892

Common stock issued to management             4          747                                                                751

Capital contribution from parent                      24,440                                                             24,440
----------------------------------------------------------------------------------------------------------------------------------
Balance, December 31, 2002             $  2,009  $ 1,172,344  $(463,516)   $   (2,679) $  (165,637)    $ (703,414)    $(160,893)
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>


See  Notes  to  Consolidated  Financial  Statements








































NOTES  TO  CONSOLIDATED  FINANCIAL  STATEMENTS
(DOLLARS  IN  THOUSANDS  EXCEPT  SHARE  AND  PER  SHARE  DATA)

1.     BACKGROUND

The  Company,  Borden Chemical, Inc. (formerly Borden, Inc.) was incorporated on
April  24,  1899.  After  the sale of the Consumer Adhesives business segment in
2001 to an affiliate, the sole remaining business of the Company is the Chemical
business,  which  is  engaged primarily in manufacturing, processing, purchasing
and  distributing  forest  products and industrial resins, formaldehyde, coating
and other specialty and industrial chemicals worldwide.  The Company's executive
and  administrative  offices  are located in Columbus, Ohio. Chemical production
facilities  are  located  throughout  the  United  States  and  in  many foreign
countries.

On March 14, 1995,  affiliates of Kohlberg Kravis Roberts & Co. ("KKR") acquired
control  of  the  Company.  In  late  1995,  the  Company  began  the process of
redesigning  its  operating  structure in order to maximize value for its owners
and  determined that certain businesses did not fit into its long-term strategic
plan.  At  the  end  of  1995,  the  Company consisted of the following business
segments:  Chemical,  Food,  Other Consumer Products, Decorative Products, Dairy
and  businesses  held  for  sale.  A  group of centralized corporate departments
located  in  Columbus, Ohio provided certain governance and other administrative
services  to  all the Company's operating business units and businesses held for
sale.  As of the end of 2000, all business segments had been divested except the
Chemical  and  Consumer  Adhesives  segments.  In  2001  the  Consumer Adhesives
segment  was divested (see below), leaving the Chemical segment as the Company's
sole  remaining  business.

The  Company's  immediate  parent  is  Borden Holdings, Inc. ("BHI"), which is a
wholly  owned subsidiary of BW Holdings, LLC ("BWHLLC"), an entity controlled by
KKR.

Beginning  in  the  third  quarter  of 2002, the Company reports three operating
segments rather than one, as in the prior 2002 interim period reports, to better
reflect  the  ongoing  internal  organization  (See  Note  21).  Prior  periods
operating  segment  information  has  been  restated  to  reflect  this  change.

In  the  fourth quarter of 2001, the Company merged with its subsidiaries Borden
Chemical  Holdings,  Inc.  ("BCHI")  and Borden Chemical, Inc. ("BCI"), executed
certain  financial  transactions  with its parent and changed its name to Borden
Chemical,  Inc.  (the  "Corporate  Reorganization") reflecting the fact that the
only  remaining  business  of the Company is the Chemical business (see Note 5).
The  Corporate Reorganization was undertaken to simplify the legal structure and
strengthen the capital structure of the Company and to reduce overhead costs. As
part  of  the  Corporate  Reorganization,  certain  functions  were  downsized,
eliminated  or  transferred  to  a  separate  legal entity, Borden Capital, Inc.
("Capital"),  also  owned  by  the Company's parent. Subsequent to the Corporate
Reorganization,  Capital  provided  certain  management,  consulting  and  board
services  to the Company as well as other entities owned by KKR and charged fees
to  the  Company  and  the  other  entities  for  these  services.

During  the 2002 year, BHI decided to completely wind down Capital's operations,
with  the  cessation  of  operations  expected to occur during the first half of
2003.  Certain  management, consulting and board services previously provided to
the Company by Capital will be assumed by the Company, while other such services
will  continue to be provided to the Company by KKR for an annual fee of $3,000.

On  August  13,  2001,  an  option sold to BWHLLC in 1996 to purchase 74% of the
common  shares of Consumer Adhesives was exercised for $54,120.  Also, on August
13, 2001, a company controlled by BWHLLC purchased the remaining 26% of Consumer
Adhesives'  common  shares  for  $40,000  (collectively  "the Consumer Adhesives
Sale").  In  addition  to  the  cash  proceeds  received,  the  Company retained
continuing investments in Consumer Adhesives in the form of notes receivable and
preferred  stock.  Prior  to the Consumer Adhesives Sale, these investments were
eliminated  in the Consolidated Financial Statements.  The notes receivable from
Consumer  Adhesives  were  sold to the Company's parent on November 19, 2001 for
$57,691  (see Note 5). The carrying value of the preferred stock was $110,000 at
December  31,  2001.  The  preferred  stock  was redeemed on March 1, 2002 for a
$110,000  note  receivable from Consumer Adhesives.  On March 12, 2002, the note
receivable  was  sold  to  BHI  for cash of $110,000 plus accrued interest. As a
result  of  the  Consumer  Adhesives  Sale  and subsequent sale of the preferred
stock,  Consumer  Adhesives  is  reflected  as  a  discontinued operation in the
Consolidated  Financial  Statements  for  all  periods presented. During 2001, a
pre-tax gain of $132,275 ($94,847 after-tax) was recognized in equity due to the
affiliated  nature  of  the  transaction.

2.     NATURE  OF  OPERATIONS

The  Company  is  engaged primarily in manufacturing, processing, purchasing and
distributing  forest  products and industrial resins, formaldehyde, coatings and
other  specialty  and  industrial  chemicals  worldwide.  Prior  to the Consumer
Adhesives  Sale,  the  Company  also  manufactured,  processed,  purchased  and
distributed  consumer  glues  and  adhesives  in  North  America  (see  Note 1).

Domestic products are sold by in-house sales forces throughout the United States
to  industrial  users.  To  the  extent  practicable, international distribution
techniques  parallel  those  used  in  the United States and are concentrated in
Canada,  Western  Europe,  Latin  America,  Australia  and  Malaysia.

At  December  31, 2002, 27 of a total 48 manufacturing and processing facilities
are  located in the United States and in 2002 approximately 65% of the Company's
sales  were  generated  in  the  United  States.

3.     SUMMARY  OF  SIGNIFICANT  ACCOUNTING  POLICIES

Significant  accounting  policies  followed by the Company, as summarized below,
are  in  conformity  with  generally  accepted  accounting  principles.

PRINCIPLES  OF CONSOLIDATION - The Consolidated Financial Statements include the
accounts  of the Company and its subsidiaries, after elimination of intercompany
accounts and transactions. The Company's share of the net earnings of 20% to 50%
owned  companies  is  included  in  income  on  an  equity  basis.

USE OF ESTIMATES - The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements as well as the reported amounts of revenues and expenses during the
reporting period. The most significant estimates reflected in the financial
statements include asset impairments, environmental remediation liabilities,
related party transactions, deferred tax assets and liabilities and related
valuation allowances and other tax accruals, and pension and post-retirement
assets and liabilities. Other estimates include valuation allowances for
accounts receivable and inventories and general insurance liabilities. Actual
results could differ from these estimated amounts.

CASH  AND  EQUIVALENTS  -  The  Company  considers all highly liquid investments
purchased  with  an  original  maturity  of  three  months  or  less  to be cash
equivalents.  Included in the Company's cash equivalents and restricted cash are
interest  bearing  time  deposits  of  $70,133  in 2002 and $6,920 in 2001.  The
effect  of  exchange  rate  changes  on  cash  is  not  material.

INVENTORIES  -  Inventories  are  stated  at  lower  of  cost or market. Cost is
determined  using  the  first-in,  first-out  method.

PROPERTY  AND  EQUIPMENT  -  Land,  buildings,  and  machinery and equipment are
carried  at cost. Depreciation is recorded on the straight-line basis by charges
to expense at rates based on estimated useful lives of properties (average rates
for  buildings  3%;  machinery and equipment 6%). Major renewals and betterments
are  capitalized.  Maintenance,  repairs  and  minor  renewals  are  expensed as
incurred.

INTANGIBLES - The excess of purchase price over net tangible and identifiable
intangible assets of businesses acquired is carried as Goodwill in the
Consolidated Balance Sheet. Prior to January 1, 2002, it was the Company's
policy to carry goodwill arising prior to November 1, 1970, at cost, while
goodwill arising after that date was amortized on a straight-line basis over not
more than 40 years. Certain trademarks, patents and other intangible assets used
in the operations of the business are carried as Other Intangible Assets in the
Consolidated Balance Sheet. These intangible assets were amortized on a
straight-line basis over the shorter of the legal or useful life of the asset.

As  of  January  1,  2002,  the Company adopted SFAS No. 142 "Goodwill and Other
Intangible  Assets".  (See  Note  6)

IMPAIRMENT - The Company periodically evaluates the recoverability of long-lived
assets  by  assessing  whether  the  carrying  value  can  be recovered over its
remaining  useful  life  through the expected future undiscounted operating cash
flows  of the underlying business. Any impairment loss required is determined by
comparing  the  carrying  value  of  the  asset  to  operating  cash  flows on a
discounted  basis.  The  Company  adopted  SFAS  No.  144,  "Accounting  for the
Impairment  or  Disposal  of Long-Lived Assets", as of January 1, 2002 (See Note
8).

GENERAL  INSURANCE  -  The  Company  is  generally  self-insured  for losses and
liabilities  relating  to  workers'  compensation,  health  and  welfare claims,
physical  damage  to  property, business interruption and comprehensive general,
product  and  vehicle  liability.  The  Company maintains insurance policies for
certain items exceeding deductible limits.  Losses are accrued for the estimated
aggregate  liability  for claims using certain actuarial assumptions followed in
the  insurance  industry  and  the  Company's  experience.

REVENUE  RECOGNITION  -  Revenues  are  recognized when products are shipped and
title  and  risk  of  loss  transfers  to  the  buyer.

SHIPPING  AND  HANDLING - The Company records freight billed to customers in net
sales.  Shipping  costs  are  incurred  to  move  the  Company's  products  from
production and storage facilities to the customers.  Handling costs are incurred
from the point the product is removed from inventory until it is provided to the
shipper  and generally include costs to store, move and prepare the products for
shipment.  The  Company  incurred shipping costs of  $61,927 in 2002, $63,929 in
2001 and $63,776 in 2000.  These costs are classified as distribution expense in
the  Consolidated  Statements of Operations.  Due to the nature of the Company's
business,  handling  costs  incurred  prior  to  shipment  are  not significant.

FOREIGN CURRENCY TRANSLATIONS - Assets and liabilities of foreign affiliates are
translated at the exchange rates in effect at the balance sheet date, and income
and  expenses  are  translated  at  average exchange rates prevailing during the
year.  The  effect  of  translation  is  accounted  for  as  an  adjustment  to
shareholders'  equity.

In  addition,  the  Company  incurred  realized  and  unrealized  net  foreign
transaction  losses (gains) aggregating $1,307 in 2002,  $912 in 2001 and ($200)
in  2000.

INCOME  TAXES  - The Company files a consolidated U.S. Federal Income Tax return
with  its  parent,  BHI.  Income  tax  expense  is  based on reported results of
operations  before  income taxes. Deferred income taxes represent the tax effect
of  temporary  differences  between amounts of assets and liabilities recognized
for  financial  reporting purposes and such amounts recognized for tax purposes.
Deferred  tax  balances  are adjusted to reflect tax rates, based on current tax
laws,  that  will  be  in effect in the years in which temporary differences are
expected  to  reverse.  Deferred tax assets are reduced by a valuation allowance
when, in the opinion of management, it is more likely than not that some portion
or  all  of  the  deferred  tax  assets  will  not  be  realized.

DERIVATIVE  FINANCIAL  INSTRUMENTS  -  The Company primarily uses three types of
derivatives:  interest  rate  swaps  (which effectively convert a portion of the
Company's variable rate obligations to fixed), forward exchange contracts (which
reduce  the  Company's  cash flow exposure to changes in foreign exchange rates)
and  natural  gas  futures  (which  reduce  the  Company's cash flow exposure to
changes  in  natural gas prices).  The Company does not hold or issue derivative
financial  instruments  for trading purposes.  The Company has not elected hedge
accounting  for  any  derivatives; consequently, all derivatives are measured at
fair value and recorded on the balance sheet as an asset or liability, depending
upon  the  Company's  underlying  rights  or  obligations.

STOCK-BASED  COMPENSATION  -  The  Company accounts for stock-based compensation
under  APB  25  and  has adopted the disclosure-only provisions of SFAS No. 123,
"Accounting  for  Stock-Based Compensation" ("SFAS No. 123").  In December 2002,
the  FASB  issued  SFAS  No.  148,  "Accounting  for  Stock-Based Compensation -
Transition  and  Disclosure,  an  amendment  of  SFAS No. 123" ("SFAS No. 148").


<PAGE>
The  following  table  sets forth the required annual reconciliation of reported
and  Pro  Forma  Net  Income  and  EPS  under  SFAS  No.  148:

<TABLE>
<CAPTION>

----------------------------------------------------------------------------------------------------------------------------------
                                                               2002                       2001                       2000
----------------------------------------------------------------------------------------------------------------------------------
<S>                                                            <C>                        <C>                         <C>
NET (LOSS) APPLICABLE TO COMMON STOCK                    $   (36,583)                 $  (186,646)               $ (39,750)
     Add:  Stock-based employee compensation expense
     included in reported net income, net of related tax
     benefit                                                       9                          -                      -

     Deduct: Total stock-based employee compensation
     expense determined under fair value based method for all
     awards granted since January 1, 1996 net of related tax
     effects                                                     (94)                        (382)                    (735)
                                                         -------------------------------------------------------------------------
Pro Forma Net Income                                     $   (36,668)                 $  (187,028)               $ (40,485)
                                                         =========================================================================
Average shares outstanding - basic                           200,458                      198,997                  198,975
Average share outstanding - diluted                          200,458                      198,997                  198,975

Per share as reported (basic and diluted)                $     (0.18)                 $     (0.94)               $   (0.20)
Per share pro forma (basic and diluted)                  $     (0.18)                 $     (0.94)               $   (0.20)
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>



EARNINGS  PER  SHARE - Basic and diluted net income attributable to common stock
is  computed  by  dividing  net  income by the weighted average number of common
shares outstanding during the period. At December 31, 2002, 198,400 warrants and
3,426,040  options to purchase common shares of the Company were outstanding and
not considered dilutive.  At December 31, 2001, 1,039,864 warrants and 6,871,380
options  to  purchase  common  shares  of  the  Company were outstanding and not
considered dilutive.  Prior to 2001, options issued by subsidiaries that enabled
the  holder  to  obtain  stock of the subsidiary were assumed to be exercised if
they  were  dilutive.  As  of  December  31,  2001,  as a result of the Consumer
Adhesives Sale (see Note 1) and the Corporate Reorganization (see Note 5), there
were no options to purchase subsidiary stock outstanding.  At December 31, 2000,
there  were 5,488,750 options to purchase subsidiary stock outstanding, of which
1,106,250  were in the money but anti-dilutive due to the net loss for the year.

The  Company's  diluted  EPS  is  calculated  as  follows:

<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------------------
                                                             2002                             2001                        2000
----------------------------------------------------------------------------------------------------------------------------------
<S>                                                          <C>                               <C>                         <C>
Net loss applicable to common shareholders             $   (36,583)                       $   (186,646)               $  (39,750)

Effect of dilutive options                                    -                                   -                          -
                                                         ----------                         -----------                 ----------
Diluted EPS - Numerator                                $   (36,583)                       $   (186,646)               $  (39,750)
                                                         ==========                         ===========                 ==========
Weighted average shares - Denominator                      200,458                             198,997                    198,975
                                                         ==========                         ===========                 ==========
Diluted EPS                                            $     (0.18)                       $      (0.94)               $     (0.20)
                                                         ==========                         ===========                 ==========
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>


CONCENTRATIONS  OF  CREDIT RISK - Financial instruments that potentially subject
the  Company  to  concentrations of credit risk consist principally of temporary
cash  investments and accounts receivable. The Company places its temporary cash
investments  with high quality institutions and, by policy, limits the amount of
credit  exposure  to  any  one  institution.  Concentrations of credit risk with
respect to accounts receivable are limited, due to the large number of customers
comprising  the  Company's  customer  base  and  their  dispersion  across  many
different  industries  and  geographies.  The Company generally does not require
collateral  or  other  security  to  support  customer  receivables.

RECENTLY  ISSUED  ACCOUNTING  STANDARDS

In  July  2001,  the  FASB issued SFAS No. 143, "Accounting for Asset Retirement
Obligations", which addresses financial accounting and reporting for obligations
associated  with the retirement of tangible long-lived assets and the associated
asset retirement costs.  Under this Statement, an asset retirement obligation is
recognized  at  its  fair  value  in  the period in which it is incurred.  Asset
retirement  costs  are  capitalized  as  part  of  the  carrying  amount  of the
long-lived  asset  and, as such, a related amortization expense is recognized in
future periods.  This Statement is effective for financial statements issued for
fiscal  years  beginning  after  January  1,  2003.  The Company does not expect
implementation  of  SFAS  No.143  to have a significant impact on its results of
operation  or  financial  condition.

In  January  2002,  the  Company  adopted  SFAS  No.  142,  "Goodwill  and Other
Intangible  Assets".  SFAS  No.  142  specifies  that  goodwill  and  certain
intangibles  with indefinite lives no longer be amortized but instead be subject
to  periodic  impairment  testing.  See  Note  6.

In May 2002, the FASB issued SFAS No. 145, "Rescission of FASB Statements No. 4,
44 and 64, Amendment of FASB Statement No. 13, and Technical Corrections".  This
statement  rescinds  the  aforementioned Statements and amends SFAS No. 13.  The
provisions  of  this Statement related to SFAS No. 4 "Reporting Gains and Losses
from  Extinguishment of Debt" are effective for fiscal years beginning after May
15,  2002 but early application is encouraged.  The Company has adopted SFAS No.
145  and  has  reported a gain related to the repurchase of publicly held bonds.
See  Note  12.

In June 2002, the FASB issued SFAS No. 146, "Accounting for Costs Associated
with Exit or Disposal Activities." This Statement nullifies Emerging Issue Task
Force Issue No. 94-3, "Liability Recognition for Certain Employee Termination
Benefits and Other Costs to Exit an Activity (including Certain Costs Incurred
in a Restructuring)." The principle difference between this Statement and EITF
94-3 relates to the requirements for recognition of the liability for costs
associated with exit or disposal activities. Specifically, the liability for a
cost associated with an exit or disposal activity is no longer recognized at the
commitment date. Instead, the liability is recognized when the liability is
incurred as defined by FASB Concept Statement No. 6, "Elements of Financial
Statements". The provisions of this Statement are effective for exit or disposal
activities initiated after December 31, 2002, with early application encouraged.
Retroactive application of this Statement is prohibited. Any exit and disposal
activities initiated under EITF 94-3 shall continue to be accounted for under
the provisions of this EITF. The Company will follow the guidelines set forth in
SFAS No. 146.

In November 2002, the FASB issued Interpretation No. 45, "Guarantor's Accounting
and  Disclosure  Requirements  for  Guarantees, Including Indirect Guarantees of
Indebtedness  of Others" ("FIN 45").  FIN 45 requires a guarantor to recognize a
liability,  at the inception of the guarantee, for the fair value of obligations
it  has  undertaken  in  issuing  the  guarantee  and also include more detailed
disclosures  with  respect  to  guarantees.  FIN  45 is effective for guarantees
issued  or modified after December 31, 2002.  The disclosure requirements of FIN
45  are  effective for financial statements for interim or annual periods ending
after  December  15,  2002.  The Company has provided additional disclosure with
respect  to  guarantees in Note 23 and has not yet determined if the adoption of
the  new  rules  will  have  any  material  impact  on  the Company's results of
operations  or  financial  condition.

In  December  2002,  the  FASB  issued SFAS No. 148, "Accounting for Stock-Based
Compensation  -  Transition  and  Disclosure". SFAS No. 148 provides alternative
methods  of  transition for a voluntary change to the fair value based method of
accounting  for  stock-based  employee  compensation  and  amends the disclosure
requirements  of  SFAS  No. 123.  The transition provisions of this SFAS No. 148
are  effective for fiscal years ending after December 15, 2002.  The Company has
elected  not  to voluntarily change to the fair value based method of accounting
for  stock-based  compensation  at  this  time.  The  Company  has  included the
additional  disclosure  requirements  in  Notes  3  and  17.

In January 2003, the FASB issued Interpretation No. 46, "Consolidation of
Variable Interest Entities" ("FIN 46") to expand upon and strengthen existing
accounting guidance that addresses when a company should include in its
financial statements, the assets, liabilities and activities of another entity.
FIN No. 46 requires existing unconsolidated variable interest entities to be
consolidated by their primary beneficiaries if the entities do not effectively
disperse risks among parties involved. The consolidation requirements of FIN 46
apply immediately to variable interest entities created after January 31, 2003
and to older entities in the first fiscal year or interim period beginning after
June 15, 2003. The Company does not expect the implementation of FIN 46 to have
a significant impact on its results of operations and financial condition.


RECLASSIFICATION  - Certain prior year amounts have been reclassified to conform
with  the  2002  presentation.

4.     CHANGE  IN  REPORTING  ENTITY

The Company's subsidiary, BCP Management, Inc. ("BCPM"), filed for protection
under Chapter 11 of the United States Bankruptcy Code, in the United States
Bankruptcy Court for the District of Delaware on March 22, 2002. BCPM has served
as the general partner of Borden Chemicals and Plastics Operating Limited
Partnership ("the Partnership") which was created in November 1987 and operated
as a commodity chemicals producer. On April 3, 2001 the Partnership filed for
protection under Chapter 11 of the United States Bankruptcy Code, in the United
States Bankruptcy Court for the District of Delaware. On February 5, 2003, the
U.S. Bankruptcy Court approved a Joint Plan of Liquidation for the Partnership
and BCPM (the "Joint Plan") which provides for the transfer of the remaining
assets of both entities, including preference, avoidance and other claims
against third parties (including the Company) to separate liquidating agents for
liquidation and distribution to their creditors. The Company's ownership
interest in BCPM will be extinguished and no distributions from BCPM to the
Company are anticipated. The Company recorded charges totaling $30,000 for
calendar years 2000 and 2001 to reduce the value of the Company's investment in
BCPM to zero. No claims have been filed against the Company in connection with
these bankruptcy proceedings; however, no assurance can be given that such
claims will not be made in the future.


As a result of the bankruptcy of BCPM, the Company no longer consolidates BCPM
in its Financial Statements but rather accounts for BCPM under the equity method
of accounting for all periods presented. There is no impact on previously
reported amounts of net (loss) income as a result of the deconsolidation, while
the impact on the Consolidated Balance Sheet at December 31, 2001 is to reduce
both total assets and liabilities by $6,167. The Company's equity-method
investment in BCPM was written down to $0 in 2001.

5.     CORPORATE  REORGANIZATION

In the fourth quarter of 2001, the Company merged with its subsidiaries BCHI and
BCI,  executed  certain  financial  transactions with its parent and changed its
name  to  Borden  Chemical,  Inc.  reflecting  the  fact that the only remaining
business  of  the Company is the Chemical business. The Corporate Reorganization
was  undertaken  to  simplify  the  legal  structure  and strengthen the capital
structure  of the Company and to reduce overhead costs. As part of the Corporate
Reorganization, certain functions were downsized, eliminated or transferred to a
separate  legal  entity, Capital, also owned by the Company's parent. Subsequent
to the Corporate Reorganization, Capital provided certain management, consulting
and  board  services  to  the Company as well as other entities owned by KKR and
charged  fees  to  the  Company  and the other entities for these services.  The
Company  provides  certain  administrative  services to Capital. The Company was
charged  a  management  fee of $9,000 in 2002, payable quarterly in arrears, for
the  net  cost  of  the  services.

In  2001,  the  Company's  parent  contributed  all  of the outstanding Series A
Cumulative  Preferred  Stock  ("Preferred  Stock") plus accumulated dividends of
$6,553  to the Company as a capital contribution. Prior to this, the Company had
24,574,751  shares  of  Preferred  Stock outstanding with a total of 100,000,000
shares  authorized.  Each  share  had  a  liquidation  preference of $25 and was
entitled  to  cumulative dividends at an annual rate of 12% payable quarterly in
arrears.  The  significant  impact of this transaction was to eliminate required
annual  future  preferred  dividend  payments  of  $73,724.

In 2001, as part of the Corporate Reorganization, the Company recorded severance
costs  of $1,501 for workforce reductions and additional costs of $2,044 related
to  the  Corporate  Reorganization.  These  amounts  are  classified as business
realignment, impairments and other in the Consolidated Statements of Operations.

In  conjunction with the Corporate Reorganization in the fourth quarter of 2001,
the  Company  sold  certain  assets  to  its parent for cash. The Company sold a
common  stock  equity  investment  for  $55,187  resulting  in a pre-tax gain of
$15,797  ($10,197  after-tax) that is recorded as an increase to Paid-in-Capital
due  to the affiliated nature of the transaction. Notes receivable from Consumer
Adhesives were sold for their carrying amount of $57,691,  and a loan receivable
from WKI Holding Company, Inc. ("WKI") (see Note 22) of $25,056 was sold for its
fair value of $18,056.  Prior to the sale in 2001, the Company recorded a $7,000
charge  which  is included in investment writedowns and other charges to reflect
the  decline  in  fair value of the WKI loan receivable.  On March 12, 2002, the
Company  used  the proceeds of $110,000 from the sale to the Company's parent of
its  remaining investment in Consumer Adhesives, to further repay its affiliated
debt.  All assets sales were sold at management's best estimate of fair value at
the  date  of  sale.

In  2001,  the  Company  paid  Capital $8,741 to assume certain liabilities, the
estimated  fair  value  at  the date of sale, net of certain assets transferred,
including  accounts  receivable  from WKI of $3,594.  These liabilities were for
accrued  compensation,  certain  employee  benefit  obligations  and  accrued
liabilities  associated  with  the  transferred  employees  and  functions.

In  2002,  the  Company's  parent  decided  to  completely  wind  down Capital's
operations,  with the cessation of operations expected to occur during the first
half  of  2003.  Certain  management,  consulting  and board services previously
provided  to  the Company by Capital will be assumed by the Company, while other
such  services  will continue to be provided to the Company by KKR for an annual
fee  of  $3,000.  The  Company  recorded  a  charge  of  $5,500 related to costs
allocable  to  the  Company  in  connection  with  the  cessation  of  Capital's
operations.

Beginning  in  1996,  key subsidiaries of the Company issued stock options under
their  individual Stock Purchase and Option Plans for Key Employees. The options
held by Chemical employees became options of the Company effective with the 2001
Corporate  Reorganization  (see  Note 17).  In addition, the Company settled the
minority  interest  liability  related  to  the  ownership  of shares in BCHI by
management  of BCHI by exchanging shares of the Company's stock and common stock
warrants for the BCHI shares held by management. This resulted in an increase to
Paid-in-Capital  for  2001  of  $1,236,  the  book  value of the liability which
approximates  fair  value.

6.     GOODWILL  AND  INTANGIBLE  ASSETS

As  of  January  1,  2002  the  Company adopted SFAS No. 142 "Goodwill and Other
Intangible  Assets".  Consequently,  subsequent to January 1, 2002, goodwill and
identifiable  intangible  assets  with  indefinite  useful  lives  are no longer
amortized  and  identifiable  assets with finite useful lives are amortized over
their  respective  useful  lives.

The  Company's  recorded  goodwill  of  $71,399 as of December 31, 2001 had been
recorded in conjunction with numerous business acquisitions.  In accordance with
the  implementation  of SFAS No. 142, the Company tested goodwill for impairment
as  of January 1, 2002.  As required by the new accounting principle, to perform
the  goodwill  impairment  test the Company identified the appropriate reporting
units,  assigned  assets  and  liabilities (including goodwill) to the reporting
units,  determined  estimated  fair  values of the reporting units, and assessed
whether  the  estimated  fair value of each reporting unit was more or less than
the  carrying  amount of the assets and liabilities assigned to the units.  As a
result of this test, the fair value of each reporting unit exceeded the carrying
amount  of  assets  and  liabilities assigned, except for the Company's European
reporting  unit.  Based  on  the excess of the carrying value over the estimated
fair  value  of  its  European  reporting  unit, the Company recorded a goodwill
impairment  charge  of  $29,825  which  represents  100%  of the January 1, 2002
carrying  amount.  There  was  no tax benefit recognized in conjunction with the
impairment  charge.  This impairment charge is reported as the cumulative effect
of  change  in accounting principle in the Consolidated Statements of Operations
and  the  goodwill  amount at December 31, 2002 has been reduced by this amount.

To determine estimated fair values of the Company's reporting units, the Company
engaged mergers and acquisition professionals employed by Capital, an affiliate
of the Company. The valuations were performed using a standard methodology based
largely on comparable company analysis. Comparable company analysis ascribes a
value to an entity by comparing certain operating metrics of the entity to those
of a set of comparable companies in the same industry. Using this method, market
multiples and ratios based on operating, financial and stock market performance
are compared across different companies and to the entity being valued. The
Company employed a comparable analysis technique commonly used in the investment
banking and private equity industries to estimate the values of its reporting
units - the EBITDA (earnings before interest, taxes, depreciation and
amortization) multiple technique. Under this technique, estimated values are the
result of an EBITDA multiple derived from this process applied to an appropriate
historical EBITDA amount.

The  following  table provides a comparison of 2002, 2001 and 2000 as if the new
accounting  principle  were  applied  to  the  prior  year  periods:


<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------------------
                                                                     YEAR ENDED DECEMBER 31,
----------------------------------------------------------------------------------------------------------------------------------
                                                  2002                             2001                            2000
----------------------------------------------------------------------------------------------------------------------------------
<S>                                               <C>                              <C>                             <C>

Reported net (loss) income                 $     (36,583)                   $   (124,800)                      $  33,974
Add back goodwill amortization                      -                              3,712                           2,877
                                                ---------                      ----------                        --------
Adjusted net (loss) income                       (36,583)                       (121,088)                         36,851

Add back cumulative effect of
     change in accounting principle               29,825                            -                               -
                                                ---------                      ----------                        --------
Adjusted net (loss) income before
     cumulative effect of change
     in accounting principle               $      (6,758)                   $   (121,088)                      $  36,851
                                               ==========                      ==========                        ========
Basic and diluted per share data:
Reported net (loss) income                 $       (0.18)                   $      (0.63)                      $    0.17
Add back goodwill amortization                       -                              0.02                            0.02
                                                ---------                      ----------                        --------
Adjusted net (loss) income                         (0.18)                          (0.61)                           0.19
Add back cumulative effect of
     change in accounting principle                 0.15                              -                               -
                                                ---------                      ----------                        --------
Adjusted net (loss) income before
     cumulative effect of change
     in accounting principle               $       (0.03)                   $     (0.61)                       $    0.19
                                               ==========                      ==========                        ========
</TABLE>




The  changes  in the carrying amount of goodwill for the year ended December 31,
2002  are  as  follows:


<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------------------------
                                                    North                   North
                                                    American                American
                                                    Forest                  Performance
                                                    Products                Resins               International           Total
                                                   -----------             -----------            ----------         -----------
<S>                                                    <C>                    <C>                    <C>                  <C>
Goodwill balance at December 31, 2001            $   20,713              $   19,487             $   31,199           $ 71,399
Less goodwill impairment recognized
upon adoption of SFAS No. 142                            -                      -                  (29,825)           (29,825)
Other acquisitions/divestitures                          -                   (1,343)                   -               (1,343)
Foreign currency translation                              6                     -                     (597)              (591)
                                                   -----------             -----------            ----------         -----------
Goodwill balance at December 31, 2002            $   20,719              $   18,144             $       777          $  39,640
                                                   ===========             ===========            ===========        ===========
</TABLE>






















Intangible  assets,  which  will  continue  to  be  amortized,  consist  of  the
following:
<TABLE>
<CAPTION>

----------------------------------------------------------------------------------------------------------------------
                                                At December 31, 2002                        At December 31, 2001
                                   ----------------------------------------     --------------------------------------
                                            Gross                                     Gross
                                           Carrying         Accumulated               Carrying          Accumulated
                                           Amount           Amortization              Amount            Amortization
                                          ---------         ----------              ----------            ----------
<S>                                         <C>               <C>                      <C>                   <C>
Intangible assets:

     Customer list and contracts        $   6,559        $    3,736               $   6,559              $   2,824
     Formulas and technology                6,524             4,331                   6,524                  3,730
     Unrecognized prior service cost        2,657               153                   2,657                    -
     Other                                    744               654                     744                    683
                                          ---------         ----------              ----------            ----------
                                        $  16,484        $    8,874               $  16,484              $   7,237
                                          =========         ==========              ==========            ==========
----------------------------------------------------------------------------------------------------------------------
</TABLE>



The  impact  of  foreign  currency  translation  adjustments  is  included  in
accumulated  amortization.

Aggregate  intangible  amortization expense for the year ended December 31, 2002
and  2001  was  $  1,555  and  $  1,653  respectively.

Estimated  annual  intangible  amortization  expense for 2003 through 2007 is as
follows:
<TABLE>
<CAPTION>

<S>                    <C>

2003                 $1,634
2004                  1,634
2005                    969
2006                    350
2007                    183
</TABLE>



7.     BUSINESS  ACQUISITIONS

All  of the Company's acquisitions described below have been accounted for using
the  purchase  method  of accounting.  Accordingly, results of operations of the
acquired entities have been included from the date of acquisition and any excess
of  purchase  price  over  the  sum of amounts assigned to identified assets and
liabilities  has  been  recorded  as  goodwill.  The  pro  forma  effects of the
acquisitions  are  not  material.

In  2001,  the  Company  and  Delta-HA, Inc. merged their North American foundry
resins  and  coatings  businesses.  In  conjunction  with the merger the Company
recognized  an  accrual of approximately $7,000 to restructure operations of the
acquired  entity,  minority  interest  liability  of $4,500 to recognize the 25%
minority  interest,  and  recorded  goodwill  of  approximately  $9,000.

In  2000,  the  Company  acquired the formaldehyde and certain other assets from
BCPOLP,  an affiliate of the Company, for $23,764 and acquired East Central Wax,
Inc.,  a  manufacturer  of  wax  emulsions  for  the wood products industry, for
$2,900.  Both  acquisitions  were  for  cash.  No goodwill was recorded with the
BCPOLP  asset  acquisition  and  $1,894  was  recorded with the East Central Wax
acquisition.

Also  in 2000, the Company acquired certain assets and liabilities of a Canadian
based Consumer Adhesives business for $91,484 in cash. The business manufactured
glue,  glue  sticks,  paints,  tapes  and  craft/stationery  products  at  its
manufacturing  facility  in  Ontario,  Canada.  Goodwill  recorded  with  the
acquisition  was  $16,254.  This  business was sold in conjunction with the 2001
Consumer  Adhesives  Sale  (see  Note  9).

8.     DIVESTITURES,  BUSINESS  REALIGNMENT  AND  ASSET  IMPAIRMENTS

In  2002,  management continued to review and adjust its structure to streamline
its  operations  in  order  to  improve  business financial results and maximize
returns  to  owners  of  the  Company.  As a result of this process, the Company
committed  to certain business realignment activities. Management of the Company
expects  to  continue to review its operating structure and strategic options in
2003.


Divestitures
------------

The  following  schedule summarizes the net cash proceeds, pre-tax and after-tax
gains  and  losses associated with business divestiture activities over the last
three  years.

<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------------------
                                            NET CASH PROCEEDS                                               GAIN (LOSS)
                                    -----------------------------------                       ------------------------------------
                                    2002           2001           2000                          2002            2001        2000
                                  --------      ---------       --------                      --------        --------   ---------
<S>                                 <C>            <C>            <C>                           <C>              <C>          <C>
CONTINUING OPERATIONS
Ecuador                           $  -        $  5,275                                     $      -        $ (2,303)
Printing Inks                                                 $  10,330                                                 $ (3,561)
Commercial & industrial
     Wallcoverings                                                                                                          2,000
     Other                                                          616                                                       616
                                  --------      ---------       --------                      --------        --------   ---------
TOTAL CONSOLIDATED PRE-TAX        $  -         $  5,275       $  10,946                      $    -          $ (2,303)  $    (945)
                                  --------      ---------       --------                      --------        --------   ---------

CONSOLIDATED AFTER-TAX (LOSS)                                                                $    -          $ (2,839)  $    (519)
                                                                                              =========       =========  =========
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

In 2001, the Company divested its chemical operation in Ecuador. Proceeds from
the sale of the Ecuador chemical business were $5,275, resulting in a pre-tax
loss of $2,303 ($2,839 after-tax).

In 2000, the Company sold its chemical printing inks business for $10,330,
resulting in a pre-tax loss of $3,561 ($2,172 after-tax), and distributed 100%
of its ownership in its infrastructure management services business to its
parent, which was treated as a dividend at the recorded net book value of
$16,277.

Also in 2000, gains on divestitures prior to 2000 of $2,616 were recognized.

Business Realignment, Impairments and Other
-------------------------------------------

During  2002,  the  Company recorded business realignment, impairments and other
expense  of  $19,699,  consisting of business realignment expense of $13,384 and
non-cash  asset  impairment charges of $6,315.   Of the total $19,699 of expense
recorded in 2002, $7,557 was recorded in the fourth quarter, $2,082 in the third
quarter,  $5,401  in  the  second  quarter  and  $4,659  in  the  first quarter.

Provided below is a rollforward of business realignment reserve activity
for 2002:

<TABLE>
<CAPTION>
<BTB>
----------------------------------------------------------------------------------------------------------------------------------
                                                   RESERVES                                                            RESERVES
                                                   DECEMBER 31,             2002                     2002              DECEMBER 31,
                                                   2001                   EXPENSE(1)              CHARGES (2)          2002
----------------------------------------------------------------------------------------------------------------------------------
<S>                                                 <C>                      <C>                     <C>                    <C>

Plant closure costs (3)                        $   14,067                $   10,119             $   (14,618)          $   9,568
Other severance and employee costs                  8,360                     3,265                  (7,629)              3,996
                                                -----------               ----------              ----------            ----------
                                               $   22,427                $   13,384             $   (22,247)          $   13,564
----------------------------------------------------------------------------------------------------------------------------------
<FN>

(1)     Excludes  $6,315  of  non-cash  impairment  charges
(2)     Non  cash  charges  to  the  restructuring  reserve  totaled  $2,217
(3)     Plant  closure  costs  include  fixed  asset  write-offs, plant employee severance and demolition,
environmental  and other related costs, offset by any pre-tax gain on the sale of assets associated with a
closed  plant.
</TABLE>


Plant  closure  expense  in 2002 of $10,119 consists of $12,584 of plant closure
costs  primarily  related  to  the  closure  of  the  melamine  crystal business
facility, partially offset by a pre-tax gain on the sale of land associated with
a  previously  closed  plant  of  $2,465  ($1,602 after-tax).  The $12,584 plant
closure  costs  include  plant  employee  severance  of  $2,721  and demolition,
environmental  and  other  costs  of  $9,863.  Additionally,  included  in plant
closure  costs  is a $1,099 increase to the reserve related to revised estimates
of  environmental  clean-up  and  demolition  for  several  locations  closed in
previous  years.

In fourth quarter 2002, the Company recorded an expense of $5,275 related to the
impairment  of  fixed  assets  of  international  manufacturing  facilities  in
accordance  with  SFAS  No.  144  "Accounting  for the Impairment or Disposal of
Long-Lived  Assets".  Also  in  the  fourth  quarter,  the Company increased its
impairment  charge  by  $1,040  related  to  a  new  plant  facility  for  which
construction  was  discontinued in 2001.  This impairment charge was required to
reflect  the  current  estimated net recoverable value of the land and building.

During  2001,  the  Company recorded business realignment, impairments and other
expense  of  $126,408, consisting of business realignment expense of $25,360 and
non-cash  asset  impairment  charges  of  $101,048.

Provided  below  is  a  rollforward of business realignment reserve activity for
2001:
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------------------
                                                   RESERVES                                                            RESERVES
                                                   DECEMBER 31,             2001                     2001              DECEMBER 31,
                                                   2000                   EXPENSE(1)              CHARGES              2001
----------------------------------------------------------------------------------------------------------------------------------
<S>                                                 <C>                      <C>                     <C>                    <C>

Plant closure costs (2)                        $   32,292                $   12,778             $   (31,003)          $   14,067
Other severance and employee costs                  -                        12,582                  (4,222)               8,360
                                                -----------               ----------              ----------            ----------
                                               $   32,292                $   25,360             $   (35,225)          $   22,427
----------------------------------------------------------------------------------------------------------------------------------
<FN>

(1)     Excludes  $101,048  of  non-cash  impairment  charges
(2)     Plant  closure  costs  include fixed asset write-offs, plant employee severance and demolition,
environmental and other related costs, offset by any pre-tax gain on the sale of assets associated with
a  closed  plant.
</TABLE>


Business  realignment  expense  in  2001 of $25,360 consists of $12,778 of plant
closure  costs and $12,582 of severance and other employee costs.  Plant closure
costs  include  fixed  asset  write-offs of $11,863, plant employee severance of
$  1,862,  and  demolition, environmental and other costs of $9,560, offset by a
pre-tax  gain  on  the  sale  of  land associated with a closed plant of $10,507
($6,515  after-tax).

In  fourth  quarter 2001, the Company announced that it had decided to offer for
sale  its  wholly  owned  subsidiary,  Melamine  Chemicals,  Inc. ("MCI"), which
manufactured  melamine  crystal  at  a  plant  in  Louisiana.  For  economic and
strategic  purposes,  the  Company  has  entered  into  a  long-term contractual
arrangement,  which  took  effect  January  1, 2002, with a major supplier for a
substantial portion of its future melamine crystal needs.  As of the end of 2001
no  sale  had  been  negotiated  and  in  January  2002, the plant was shut-down
indefinitely.  Under  SFAS No. 121, "Accounting for the Impairment of Long-Lived
Assets and for Long-Lived Assets to be Disposed Of", the Company recorded a 2001
expense  of  $98,163  for  impairment  of melamine fixed assets, spare parts and
goodwill  of  $62,527,  $2,935  and $32,701, respectively.  The Company incurred
additional employee and environmental costs in the first quarter 2002 related to
the  MCI  closure, as discussed above.  Also in fourth quarter 2001, the Company
discontinued  construction  of  a  new  plant and recorded a charge of $2,885 of
engineering,  construction  and other costs to reflect estimated net recoverable
value  of  the  land  and  building.

9.     DISCONTINUED  OPERATIONS

The  summary  of  discontinued  operations  below  includes  Consumer Adhesives'
results  through  August  2001,  the  date  of  the  Consumer  Adhesives  Sale:

<TABLE>
<CAPTION>

----------------------------------------------------------------------------------------------------------------------------------
                                                   2002                              2001                              2000
----------------------------------------------------------------------------------------------------------------------------------
<S>                                                 <C>                              <C>                                  <C>

Net sales                                      $    -                            $   106,307                        $    137,980
                                               ===========                         ============                       ============
Income before income taxes                     $    -                            $    17,404                        $     19,082
Income tax expense                                  -                                  5,600                               5,849
                                               -----------                        -------------                      -------------
Income from discontinued
     Operations                                $    -                            $    11,804                        $     13,233
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>


Proceeds  from  the  Consumer Adhesives sale were $94,120, net of cash sold with
the business, resulting in a pre-tax gain of $132,275 ($94,847 after-tax), which
was recorded in Paid-in-Capital due to the affiliated nature of the transaction.
In addition to the amounts shown above, gains and losses (net of tax) recognized
on  the  sale  of  discontinued  operations  are  included  separately  in  the
Consolidated  Statements  of  Operations.

The  Company recognized $93,000 as a gain on disposal of discontinued operations
in  2000.  As a result of a settlement reached with the Internal Revenue Service
in the second quarter of 2000, amounts established for tax issues related to the
prior  divestiture  of certain segments of the Company's business were no longer
considered  necessary.  A portion of these amounts was classified as gain on the
sale  of  discontinued operations in 2000, consistent with the classification of
these  amounts  when  established.

10.     OTHER  COMPREHENSIVE  INCOME

Other  comprehensive  income  includes  the  following  items:
<TABLE>
<CAPTION>

----------------------------------------------------------------------------------------------------------------------------------
                                                      2002                               2001                             2000
----------------------------------------------------------------------------------------------------------------------------------
<S>                                                    <C>                             <C>                                <C>

 Foreign currency translation adjustments        $  (14,856)                        $  (12,649)                       $  (9,558)
 Reclassification adjustments                           -                                5,800                             -
 Cumulative effect of change in accounting
    principle                                           -                               (3,300)                            -
 Derivative activity                                    730                              2,570                             -
 Minimum pension liability                          (17,075)                           (66,580)                           1,779
                                                  -----------                         -----------                       -----------
                                                $   (31,201)                        $  (74,159)                       $  (7,779)
                                                  ===========                         ===========                       ===========
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>


The  2001  reclassification  adjustment  reflects  the  accumulated  translation
adjustment  recognized  on  the  sale  of  the  Company's operations in Ecuador.

The cumulative effect of change in accounting principle represents the impact of
the adoption of Statement of Financial Accounting Standards No. 133, "Accounting
for  Derivative  Instruments  and  Hedging Activities," on January 1, 2001.  The
Company  recorded a pre-tax initial transition adjustment to Other Comprehensive
Income  of  $5,200  ($3,300  net  of  tax) of which $1,131 ($730 net of tax) and
$3,870  ($2,570  net  of  tax) was reclassified into earnings for the year ended
December  31,  2002  and  2001,  respectively.

The components of accumulated other comprehensive income as of December 31, 2002
and 2001 are as follows:


<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------
                                               2002                                     2001
                                         -----------------                        -----------------
<S>                                              <C>                                   <C>
Cumulative foreign currency
     translation adjustments           $      (81,537)                               $   (66,681)
Minimum pension liability, net of tax         (84,100)                                   (67,025)
Cumulative derivative activity                   -                                          (730)
                                         -----------------                        -----------------
                                       $     (165,637)                               $  (134,436)
                                         =================                        =================
---------------------------------------------------------------------------------------------------
</TABLE>

11.     INVESTMENTS  IN  AFFILIATES

Investment  in  affiliates  at  December  31,  2001  represents  the  Company's
investment  in Consumer Adhesives preferred stock.  In March 2002, the preferred
stock  was  redeemed for a note receivable, which was then sold to the Company's
parent,  along  with  accrued  interest,  at what management believes to be fair
value  (see  Note  5).

The  Company  sold a common stock equity investment in 2001 for $64,141.  Of the
total  proceeds, $8,954 was received from sales to third parties and $55,187 was
received  from the Company's parent as part of the Corporate Reorganization (see
Note  5).  Because the sale was to a related party, the gain of $15,797 ($10,197
net  of  tax)  on  the  sale  to its parent is included in shareholders' equity.

The Company continuously reviews the carrying value of investments in accordance
with  accounting guidance that requires investments to be adjusted to fair value
if  the  decline  in  value  is considered to be "other than temporary" based on
certain  criteria.  In  2001,  the  Company  wrote-off  the  remaining  $10,000
investment  in WKI Holding Company, Inc. (WKI) preferred stock, wrote-off $7,000
of  a loan receivable from WKI and wrote-off the remaining $10,000 investment in
BCPM.  In  2000,  the  Company  wrote-off $47,969 of investment in WKI preferred
stock  and  $20,000  of  investment  in  BCPM.  The  write-offs are reflected in
Investment  write-downs  and  other  charges  in  the Consolidated Statements of
Operations.


12.     DEBT, LEASE  OBLIGATIONS, UNCONDITIONAL PURCHASE OBLIGATIONS AND RELATED
COMMITMENTS

Debt  outstanding  at  December  31,  2002  and  2001  is  as  follows:
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------------------
                                                            2002                                                   2001
                                                  -------------------------                             --------------------------
                                                                 Due Within                                            Due Within
                                                  Long-Term      One Year                                Long-Term     One Year
                                                 -----------     ----------                              ----------   ------------
<S>                                                  <C>            <C>                                     <C>            <C>
9.2% Debentures due 2021                         $  114,800                                              $ 117,050

7.875% Debentures due 2023                          246,782                                                250,000

Sinking fund debentures:
     8-3/8% due 2016                                 78,000                                                 78,500
     9-1/4% due 2019                                 47,295                                                 48,695

Industrial Revenue Bonds (at an average rate of
9.5% in 2002 and 2001)                               34,885                                                 34,885     $  1,400

Other (at an average rate of  13.8% in 2002 and
13.3% in 2001)                                        1,525                                                  3,367
----------------------------------------------------------------------------------------------------------------------------------
Total current maturities of long-term debt                                                                                1,400

Short-term debt (primarily foreign bank loans
    at an average rate of  10.7%)                                $    2,779                                               1,678
----------------------------------------------------------------------------------------------------------------------------------
Total debt                                       $  523,287      $    2,779                              $ 532,497     $  3,078
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>


During  the  fourth  quarter  of  2002,  the  Company  repurchased $7,368 of the
outstanding  publicly  held  bonds  for  $4,510 plus fees.  A $2,741 gain on the
extinguishment of the bonds was recognized in the fourth quarter and is included
in  other  non-operating  income.

In  the  third  quarter of 2002, the Company entered into a new three-year asset
based  revolving  credit  facility  dated  September  23,  2002 (the "New Credit
Facility") which provides for a maximum borrowing of $175,000, including letters
of  credit.  The  New  Credit Facility replaces the uncommitted letter of credit
facility  (discussed  below) and the prior $250,000 Credit Facility that expired
on  July  13,  2002.  The  New  Credit  Facility  is  secured with inventory and
accounts  receivable  in  the United States, Canada and the United Kingdom and a
portion  of  property  and  equipment in Canada and the United Kingdom.  The New
Credit  Facility  contains  restrictions on dividends, limitations on borrowings
from  affiliates  ($30,000  after  letters  of  credit  are  reissued under this
facility), capital expenditures ($65,000 in 2003) and payment of management fees
($5,000  per  year  in  2003  and  beyond)  in  addition  to  a minimum trailing
twelve-month fixed charge coverage ratio of 1.5 to 1.0 if aggregate availability
is  less  than  $25,000.  The  credit  facility  will be used to fund short-term
working  capital  needs  and capital improvements.  As of December 31, 2002, the
maximum  borrowing  allowable  under  this credit facility was $137,127 of which
$123,836  was  unused and available.  If the letters of credit had been reissued
under  the  New  Credit  Facility  and  the  newly  unrestricted cash collateral
(discussed  below)  were  used  to  pay down the affiliate debt, at December 31,
2002, the availability under the New Credit Facility would have been $57,451 and
additional  allowable  borrowings  from  affiliates  would  have  been  $12,369.

Under the terms of the New Credit Facility the Company has the ability to borrow
funds  at  either  the  prime rate plus an applicable margin or at LIBOR plus an
applicable  margin.  The  Company  must designate which option it chooses at the
time  of  the  borrowing.  Currently  the  applicable  margin for any prime rate
borrowing  is  75  basis points and for any LIBOR borrowing is 225 basis points.
As of December 31, 2002 there are no borrowings outstanding under either option.
For  letters  of  credit issued under the New Credit Facility the Company pays a
per  annum  fee  equal to the LIBOR applicable margin, or 2.25%, plus a fronting
fee  of .125%.  In addition, the Company pays a .50% per annum fee on the amount
of  the  revolving loan commitment less any borrowings or outstanding letters of
credit.

The  uncommitted  letter  of  credit  facility mentioned above, initially in the
amount of $45,000, was increased in second quarter 2002 to $85,000.  The Company
was  required  to  provide  cash collateral equivalent to 101% of the letters of
credit  outstanding under this facility.  The fees under this facility were 1/2%
per  annum  of  the amount of the letters of credit outstanding.  The letters of
credit  are  in the process of being cancelled and reissued under the New Credit
Facility.  As  the  letters  of  credit  are  cancelled  and  cash  is no longer
restricted  as  collateral,  the  Company  plans to use the cash to pay-down its
loans  payable  to  affiliates.

As  mentioned  above,  the  Company's  prior  credit  facility  in the amount of
$250,000  expired  July  13, 2002.  Under the terms of that facility, the Borden
Foods affiliate guaranteed the payment of amounts due under the credit facility.
Upon  the  expiration  of  the  facility,  the  Foods  guarantee  obligation was
released,  which  automatically released Foods from the corresponding obligation
to  guarantee  the  payment  of  the  Company's  outstanding publicly held debt.

Additional  credit  agreements  are  executed  for  the  Company's international
locations.  As  of  December  31,  2002,  these  locations had credit facilities
totaling  $22,032.  Of  this  amount  $17,614  (net of $2,126 in a term loan and
$2,292  in  other draws on the line of credit) was available for borrowing under
these  credit  agreements.  The  Company's  international  units  incurred  no
commitment  fees  in  2002.

Purchase  Obligations
---------------------
In  fourth  quarter  2000,  the  Company entered into fixed rate, fixed quantity
contracts to secure a portion of future natural gas usage at certain facilities.
The contracts were entered into to partially hedge the Company's risk associated
with natural gas price fluctuations in peak usage months.  Contracts covered the
period  from  October  2000  through  March  2003.  Gas  purchases  under  these
contracts totaled $671 and $853 in 2002 and 2001, with $402 and $1,073 of future
commitments  at  December  31,  2002  and  2001,  respectively.  These contracts
covered  approximately  86%  in 2002 and between 75% and 85% of 2001 natural gas
usage  during  the  periods  of  the  contracts  at  those  facilities.

Due  to a sharp increase in natural gas prices in 2000, the Company expanded its
natural  gas  hedging  activities in June 2001 to hedge a portion of natural gas
purchases  for all of North America.  The Company entered into futures contracts
with varying settlement dates through November 2002.  The contracts were settled
for  cash  each  month  based  on  the  closing market price on the last day the
contract  trades  on the New York Mercantile Exchange.  The Company used futures
contracts  to  hedge  43%  of  its  2002  North  American  natural  gas  usage.
Approximately  24%  of  the Company's 2001 North American natural gas usage from
June  through December was hedged through futures contracts. Commitments settled
under  these contracts totaled $1,210 and $1,716 in 2002 and 2001, respectively.
There  were no future commitments under these contracts at December 31, 2002 and
$520  of  future  commitments  at  December  31,  2001.

Aggregate  maturities  of  total  debt,  minimum  annual rentals under operating
leases  and  unconditional  purchase obligations for natural gas at December 31,
2002,  for  the  Company  is  as  follows:

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------
                                                       MINIMUM                     PURCHASE
                                                       RENTALS  UNDER              OBLIGATIONS  FOR
                               DEBT                    OPERATING LEASES            NATURAL GAS
---------------------------------------------------------------------------------------------------
<S>                            <C>                          <C>                           <C>
2003                        $  2,779                    $    15,310                 $     402
2004                             607                         14,820                        -
2005                             607                         14,374                        -
2006                             300                         13,391                        -
2007                              11                         12,994                        -
2008 and thereafter.         521,762                          4,623                        -
                             ----------                  -------------                 ------------
                            $526,066                    $    75,512                 $      402
---------------------------------------------------------------------------------------------------
</TABLE>


Rental  expense amounted to $14,399, $19,566 and $22,941 in 2002, 2001 and 2000,
respectively.















13.     INCOME  TAXES

Comparative  analysis  of  the Company's income tax expense (benefit) related to
continuing  operations  follows:
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------------------
                                                  CURRENT                                                  DEFERRED
                                   ------------------------------------                 ------------------------------------------
                                   2002          2001          2000                        2002             2001            2000
----------------------------------------------------------------------------------------------------------------------------------
<S>                                <C>           <C>           <C>                         <C>               <C>            <C>

Federal                        $   (29,479)   $  (363)     $  (28,511)                  $  12,040       $   (25,800)    $  15,295
State and Local                       (380)    (4,365)         (1,493)                        187              (805)       (1,304)
Foreign                             11,574       (222)         (1,223)                      3,796               722         4,835
                                -----------    --------     ----------                   ---------        -----------    ---------
                               $   (18,285)   $(4,950)     $  (31,227)                  $  16,023       $   (25,883)    $  18,826
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>



The  Company's  income  tax expense (benefit) related to discontinued operations
was  $0,  $5,500 and $5,781 in 2002, 2001 and 2000, respectively.  The Company's
income  tax  expense  from  the  gain on disposal of discontinued operations was
$37,428  in  2001, which is reflected as a reduction to Shareholders' Equity due
to  the  affiliated nature of the transaction (see Note 1). The Company's income
tax  (benefit) related to the disposal of discontinued operations was $93,000 in
2000.

A  reconciliation  of  the  Company's difference between income taxes related to
continuing operations computed at Federal statutory tax rates and provisions for
income  taxes  is  as  follows:
<TABLE>
<CAPTION>

----------------------------------------------------------------------------------------------------------------------------------
                                                      2002                            2001                            2000
----------------------------------------------------------------------------------------------------------------------------------
<S>                                                   <C>                              <C>                             <C>
Income taxes computed at
Federal statutory tax rate                       $   (3,157)                       $   (58,602)                   $   (29,631)
State tax provision, net of
Federal benefits                                       (193)                            (5,842)                        (2,710)
Foreign tax differentials                             3,502                              1,187                          1,887
Foreign source income also subject
to U.S. taxation                                      1,777                             12,397                         13,053
Losses and other expenses
not deductible for tax                                 (863)                             2,723                            -
Impairment                                             -                                31,692                            -
Valuation Allowance                                  16,672                                -                           30,000
Adjustment of prior estimates                       (20,000)                           (14,388)                       (25,000)
----------------------------------------------------------------------------------------------------------------------------------
Income Tax (benefit) expense                   $    (2,262)                        $   (30,833)                   $   (12,401)
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>



The  2002  consolidated tax rate reflects a valuation allowance recorded against
the  deferred  benefit  of  certain  deferred interest expense deductions in the
amount  of  $16,672  that  is  no  longer  likely  to  be  utilized due to usage
limitations imposed by the Internal Revenue Code.  This expense is offset by the
reversal  of  a  $20,000 reserve that had been related to U.S. Federal and state
income  tax  audits  that  have  since  been  resolved.

The  2001  consolidated  tax  rate reflects a write-down of the fixed assets and
non-deductible  goodwill  of  $31,692  related  to  a  melamine plant due to its
indefinite  shut-down.  The rate also reflects the impact of earnings related to
the  expected sale of a foreign business that are not expected to be permanently
reinvested in foreign locations and the inability to utilize foreign tax credits
associated  with  those  earnings  due to usage limitations.  These expenses are
offset  by  the  reversal  of  a  $14,388  reserve that had been related to U.S.
Federal  and  state  income  tax  audits  that  have  since  been  resolved.

The 2000 income tax rate reflects a settlement reached with the Internal Revenue
Service  ("IRS") and the impact of usage limitations on foreign tax credits.  As
a  result  of  a  settlement  reached with the IRS, the Company recorded net tax
expense  of  $5,000  consisting  of  valuation  reserves recorded on foreign tax
credits  of  $30,000  that  are  no  longer likely to be utilized, substantially
offset  by  a $25,000 reduction of amounts established for tax issues related to
the divestiture of certain segments of the Company's business that are no longer
considered  necessary.  In addition, approximately $10,000 of income tax expense
was  recorded  on  foreign source income because related foreign tax credits are
not  expected  to  be  utilized  within  the  expiration  period.

The  domestic  and  foreign  components  of  the  Company's  (loss)  income from
continuing  operations  before  income  taxes,  and  the  effect  of  change  in
accounting  principle  of  $29,825,  are  as  follows:

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------
                                        2002                    2001                     2000
---------------------------------------------------------------------------------------------------
<S>                                      <C>                     <C>                          <C>
Domestic                           $   (42,929)           $   (165,478)            $   (89,876)
Foreign                                 33,909                  (1,959)                  5,216
                                    ------------            ------------             --------------
                                   $    (9,020)           $   (167,437)            $   (84,660)
---------------------------------------------------------------------------------------------------
</TABLE>







The tax effects of the Company's significant temporary differences, and loss and
credit  carryforwards, which comprise the deferred tax assets and liabilities at
December  31,  2002  and  2001,  are  as  follows:
<TABLE>
<CAPTION>

---------------------------------------------------------------------------------------------------
                                                      2002                                  2001
---------------------------------------------------------------------------------------------------
<S>                                                   <C>                                      <C>
ASSETS
Non-pension post-employment benefit
  Obligations                                     $  52,411                              $  53,830
Divestiture reserve                                   9,942                                  6,645
Accrued expenses and other expenses                  80,753                                 83,937
Foreign accrued expenses, pensions and
   other expenses                                       637                                  3,589
Loss and credit carryforwards                       169,302                                207,101
Pension liability                                    23,071                                  9,019
                                                  -----------                            ----------
Gross deferred tax assets                           336,116                                364,121
Valuation allowance                                 (89,321)                              (110,387)
                                                  -----------                            ----------
                                                    246,795                                253,734


LIABILITIES
Property, plant, equipment and intangibles           76,107                                 73,856
Foreign property, plant, equipment/other              5,975                                  7,018
Certain foreign intangibles                           (527)                                   (710)
Prepaid pension                                        293                                       0
Deferred gain on sale of BCP partnership interest    17,264                                 17,672
Other prepaids                                        1,827                                  2,590
                                                  -----------                            ----------
Gross deferred tax liabilities                      100,939                                100,426
---------------------------------------------------------------------------------------------------
Net asset                                         $ 145,856                              $ 153,308
---------------------------------------------------------------------------------------------------
</TABLE>



The Company's net deferred tax asset at December 31, 2002 was $145,856.  Of this
amount,  $146,790  represents net domestic deferred tax assets related to future
tax  benefits.  The  Company's  deferred  tax  asset  related to loss and credit
carryforwards,  net  of  valuation  allowance  is  $79,981.  This  is  comprised
primarily  of  net  operating loss carryforwards of $21,090 for U.S. federal tax
purposes,  which  will  begin expiring in 2021; foreign tax credit carryovers of
$12,054,  which  were  generated  in  1998  and will expire in 2004; minimum tax
credits  of $33,132, available indefinitely; and other carryforwards of $13,705.
Realization  of  the  entire  net  domestic  deferred  tax asset is dependent on
generation  of  approximately  $419,400  of  future  taxable  income.

Since  1995,  the Company has generated taxable losses from operations offset in
some  years by substantial taxable gains from the sales of operating businesses.
These sales have occurred as a result of the business strategy to streamline the
organization  and  focus  its business on Chemical related products.  Management
believes  the  expectation  of future gains from dispositions will fully utilize
the  Company's  deferred  tax  assets.

Loss  and  credit  carryforwards as well as the related valuation allowance have
both  decreased  from  2001  principally  due  to the decision by the Company to
deduct  certain  Foreign tax credits rather than treat them as credits available
to  offset future U.S. Income Tax.  In addition, the Company has determined that
it's  ability  to  utilize a deferred tax asset for deferred interest expense is
not,  "more  likely  than  not" realizable due to limitations on utilization for
this  specific asset.  As such, the Company recorded a valuation reserve on this
asset  of  $16,672  in  the  fourth  quarter  of  2002.

The  Company  has not recorded income taxes applicable to undistributed earnings
of  foreign subsidiaries that are indefinitely reinvested in foreign operations.
Undistributed  earnings  permanently reinvested amounted to $150,101 at December
31,  2002.

14.     PENSION  AND  RETIREMENT  SAVINGS  PLANS

Most  U.S. employees of the Company are covered under a non-contributory defined
benefit  plan  ("the  U.S.  Plan"). The U.S. Plan provides benefits for salaried
employees  based  on eligible compensation and years of credited service and for
hourly  employees based on years of credited service. Certain employees in other
countries  are  covered  under  other  contributory and non-contributory defined
benefit  foreign  plans  that,  in  the  aggregate,  are  insignificant.

The  Company  also  provides  a  defined contribution plan to its U.S. employees
("the  Retirement  Savings  Plan").  Eligible  salaried and hourly employees may
contribute  up  to  5%  of  their  pay  (7%  for certain longer service salaried
employees), as basic contributions to the plan.  The Company contributes monthly
to  the  plan  an  amount  equal  to  at  least  50%  and  up  to  100% of basic
contributions.  The  Company  has  the  option  to make additional contributions
based  upon  financial  performance.  Charges  to  operations  for  matching
contributions  under the Retirement Savings Plan in 2002, 2001 and 2000 amounted
to  $5,647,  $5,289  and  $6,159,  respectively.

The Company's funding of its pension plans equals or exceeds the minimum funding
requirements  imposed  by  Federal  and  foreign  laws  and  regulations.

Former associates of Foods and current and former associates of Consumer
Adhesives continue to participate in the U.S. Plan, which is sponsored by
BWHLLC. The U.S. Plan remains the liability of the Company, and Foods and
Consumer Adhesives reimburse the Company for the annual expense associated with
their respective participants in this plan. Therefore, the following tables
summarizing the pension activities for the Company's defined benefit pension
plans include the liabilities and assets relating to these affiliates. However,
the expense table excludes the expense relating to Foods, for all years
presented, and to Consumer Adhesives for 2002. The expense for Foods was $624,
$952 and $2,086 for 2002, 2001 and 2000, respectively. The Consumer Adhesives
expense for 2001 and 2000 is insignificant.

During 2002, the Company recognized a settlement charge of $13,600 related to
lump sum payments made by the U.S. Plan. During 2001, the Company recorded
settlement and curtailment charges of $10,700 relating to the partial settlement
of U.S. Plan liabilities for Foods, and an additional $5,600 settlement for
other lump sum payments made by the U.S. Plan. In 2000 a settlement charge of
$8,858 was recorded relating to the settlement of the liability for Wise
Holdings, Inc., as well as other lump sum settlements made during 2000.




































Following  is  a  rollforward  of  the  assets  and  benefit  obligations of the
Company's  defined  benefit  plans  for  the  years  ended  December  31,  :
<TABLE>
<CAPTION>

---------------------------------------------------------------------------------------------------
                                                             2002                      2001
---------------------------------------------------------------------------------------------------
<S>                                                           <C>                        <C>

CHANGE IN BENEFIT OBLIGATION

Benefit obligation at beginning of year                 $   288,107                $   306,342

Service cost                                                  3,844                      4,283
Interest cost                                                19,148                     21,997
Actuarial losses                                              4,693                     16,164
Foreign currency exchange rate changes                           84                       (193)
Benefits paid                                               (28,942)                   (45,753)
Plan amendments                                                 330                        146
Settlements/curtailments                                    (23,900)                   (19,879)
Special termination benefits                                    -                        5,000
                                                       --------------               ---------------
                                                        $   263,364                $    288,107
                                                       --------------               ---------------
CHANGE IN PLAN ASSETS

Fair value of plan assets at beginning of year          $   260,540                $    386,855
Actual return on plan assets                                (18,000)                    (60,085)
Foreign currency exchange rate changes                           34                        (176)
Employer contribution                                         1,099                       1,099
Benefits paid                                               (28,942)                    (45,753)
Settlements/curtailments                                    (23,900)                    (21,400)
                                                       --------------               ---------------
Fair value of plan assets at end of year                $   190,831                $    260,540
                                                       --------------               ---------------

Plan assets less than benefit obligation               $   (72,533)                $    (27,567)

Unrecognized net actuarial loss                            131,658                      103,624
Unrecognized initial transition gain                            13                           24
Unrecognized prior service cost                              2,534                        2,657
                                                       --------------               ---------------
Net amount recognized                                  $    61,672                 $     78,738
---------------------------------------------------------------------------------------------------
</TABLE>



The  year end obligations were calculated using a 6.5% and 7.2% rate at December
31,  2002  and  2001,  respectively.





Amounts  recognized in the balance sheets, after reclassification of the prepaid
pension  asset  to  reflect  a minimum pension liability adjustment, consist of:
<TABLE>
<CAPTION>


---------------------------------------------------------------------------------------------------
                                                           2002                           2001
---------------------------------------------------------------------------------------------------
<S>                                                         <C>                            <C>
Accrued benefit liability                              $   (70,216)                   $  (27,149)
Intangible asset                                             2,504                         2,657
Accumulated other comprehensive income                     129,384                       103,230
                                                        -----------                    ------------
Net amount recognized                                  $    61,672                    $   78,738
---------------------------------------------------------------------------------------------------
</TABLE>














Plan  assets  consist  primarily of equity securities and corporate obligations.

Following  are  the  components of net pension expense recognized by the Company
for  the  years  ended  December  31,:
<TABLE>
<CAPTION>


----------------------------------------------------------------------------------------------------------------------------------
                                                                 2002                             2001                    2000
----------------------------------------------------------------------------------------------------------------------------------
<S>                                                               <C>                             <C>                     <C>
Service cost                                                   $  3,602                        $  3,352                $  2,923

Interest cost on projected benefit
     obligation                                                  16,727                          18,701                  18,758
Expected return on assets                                       (19,386)                        (22,925)                (21,359)
Amortization of prior service cost                                  395                             436                     515
Amortization of initial transition asset                             12                            (122)                   (238)
Recognized actuarial loss                                         4,096                           3,706                   6,386
Settlement/curtailment loss                                      13,600                          16,300                   8,858
Special termination benefits                                          6                             -                       -
                                                               --------------                  ------------           -----------
Net pension expense                                            $ 19,052                        $ 19,448                $ 15,843
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

The weighted average rates used to determine net pension expense for the
Company were as follows:

<TABLE>
<CAPTION>

----------------------------------------------------------------------------------------------------------------------------------
                                                                   2002                        2001                       2000
----------------------------------------------------------------------------------------------------------------------------------
<S>                                                                 <C>                         <C>                         <C>
Discount rate                                                       7.2%                        7.7%                        7.7%
Rate of increase in future compensation levels                      4.5%                        4.7%                        4.7%
Expected long-term rate of return on plan assets                    8.3%                        8.7%                        8.7%
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

Most  employees  not  covered by the Company's plans are covered by collectively
bargained  agreements,  which  are  generally  effective  for  five years. Under
Federal pension law, there would be continuing liability to these pension trusts
if  the  Company  ceased  all or most participation in any such trust, and under
certain  other  specified  conditions. The Consolidated Statements of Operations
include charges of $504, $367 and $244 in 2002, 2001 and 2000, respectively, for
payments  to  pension trusts on behalf of employees not covered by the Company's
plans.

15.     NON-PENSION  POSTRETIREMENT  BENEFIT

The  Company  provides  certain  health and life insurance benefits for eligible
domestic  and Canadian retirees and their dependents. The cost of postretirement
benefits is accrued during employees' working careers. Domestic participants who
are  not  eligible  for  Medicare are provided with the same medical benefits as
active  employees,  while  those who are eligible for Medicare are provided with
supplemental  benefits. The Company has reserved the right to amend or terminate
the  plans  under  which  medical  benefits  are  provided to domestic retirees.
Canadian  participants  are  provided with supplemental benefits to the national
healthcare  plan  in  Canada.  The  domestic postretirement medical benefits are
contributory;  the  Canadian medical benefits are non-contributory. The domestic
and  Canadian  postretirement  life  insurance  benefits  are  non-contributory.
Benefits  are  funded  on  a  pay-as-you-go  basis.





















Following  is  a  rollforward  of  the changes in the Non-Pension Postretirement
Benefit  Obligations  of  the  Company  for  the  years  ended  December  31,:

<TABLE>
<CAPTION>

---------------------------------------------------------------------------------------------------
                                                        2002                           2001
<S>                                                      <C>                           <C>
---------------------------------------------------------------------------------------------------
CHANGE IN BENEFIT OBLIGATION
Benefit obligation at beginning of year            $   128,499                      $   108,103
Service cost                                                64                               45
Interest cost                                            8,822                            7,923
Contributions by plan participants                       2,797                            2,752
Actuarial losses                                         5,240                           16,365
Benefits paid                                          (13,818)                         (12,798)
Foreign Exchange                                             5                              (23)
Divestitures                                              -                              (2,009)
Assumption of liability from Foods                        -                               8,141
                                                   --------------                    --------------

Benefits obligation at end of year                     131,609                          128,499

Unrecognized net actuarial gain                            496                            4,879
Unrecognized prior service benefit                       7,214                           10,572
                                                   --------------                    --------------
Accrued postretirement
     obligation at end of year                     $   139,319                      $   143,950
---------------------------------------------------------------------------------------------------
</TABLE>


Also  included  in the Consolidated Balance Sheets at December 31, 2002 and 2001
are  other  post-employment  benefit  obligations  of  $6,065  and  $6,966,
respectively.

The  Company assumed the remaining domestic post-retirement benefit liability of
$8,141  from Foods in December 2001.  In 2002, Foods reimbursed the Company $509
for  the  expense  related  to  Foods'  participants.

A  6.5%  and  7.25%  weighted  average discount rate was used in determining the
postretirement  benefit  obligation at December 31, 2002 and 2001, respectively.
For  measurement  purposes,  health care costs are assumed to increase 5.25% for
pre-65 benefits and 8.25% for post-65 benefits in 2002 grading down gradually to
a  constant  5.25%  annual  increase  by the year 2008 for post-65 benefits. The
comparable assumptions for the prior year were 8.75% and 5.25% by the year 2008.

The  net  postretirement (benefit) expense table excludes the expense related to
Foods,  for all years presented, and to Consumer Adhesives from date of sale in
2001.  Following  are  the  components  of  net postretirement (benefit) expense
recognized  by  the  Company  for  2002,  2001  and  2000:
<TABLE>
<CAPTION>

---------------------------------------------------------------------------------------------------
                                                          2002              2001           2000
---------------------------------------------------------------------------------------------------
<S>                                                       <C>                <C>             <C>

Service Costs                                           $    64            $    44        $    44

 Interest cost on projected benefit
     obligation                                           8,249              7,884          7,343
 Amortization of prior service benefit                   (3,294)            (8,923)        (9,348)
 Recognized actuarial gain                                   (1)              (523)        (1,894)
 Settlement / curtailment gain                              -                 (487)        (1,075)
                                                        ----------       ----------      ----------
 Net postretirement (benefit) expense                   $ 5,018            $(2,005)       $(4,930)
---------------------------------------------------------------------------------------------------

</TABLE>














Assumed  health  care  cost trend rates have a significant effect on the amounts
reported  for  health  care  plans. A one-percentage-point change in the assumed
health  care  cost  trend  rates  would  have  the  following  effects:

<TABLE>
<CAPTION>

----------------------------------------------------------------------------------------------------------------------------------
                                                                      1% increase                                1% decrease
                                                                -------------------------                   ----------------------
<S>                                                                    <C>                                            <C>
Effect on total service cost and interest cost components          $        564                                    $   (511)
Effect on postretirement benefit obligation                               7,926                                      (7,160)
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

16.     SHAREHOLDERS'  (DEFICIT)  EQUITY

Common  Stock  and  Warrants
----------------------------
The  Company  has  200,923,628 shares of $0.01 par value common stock issued and
outstanding and 300,000,000 shares authorized.  At December 31, 2002, management
held  a  total  of  1,948,634  common shares of the Company, including 1,587,301
shares  of  restricted stock granted during 2002.  During 2002, the Company sold
333,333  shares to management at the estimated fair value of $2.25 per share. In
2002 the Company repurchased shares and retired warrants at amounts greater than
fair  market  value  and  recognized  compensation  expense  of  $487.

Preferred  Stock
----------------
On  November  19,  2001, the Company's parent contributed all of the outstanding
Preferred Stock plus accumulated dividends of $6,553 to the Company as a capital
Contribution (See  Note  5).  The  Company  declared  preferred  stock  cash
dividends  of  $0,  $61,846  and  $73,724  in 2002, 2001 and 2000, respectively.

Other  Shareholders'  Equity
----------------------------
The  Company  declared  common  stock  cash dividends of $0, $36,434 and $61,578
during  2002,  2001  and  2000,  respectively.  The dividends were recorded as a
charge  to  paid-in  capital  to  reflect  a  return of capital to the Company's
parent.

At  December  31,  2002, the Company held $404,817 of notes receivable from BHI,
which  accrue  interest  at  12%  per  year,  payable  quarterly,  and mature on
September  29,  2005.  The  notes were received from affiliates of the Company's
parent  as  proceeds from the 1996 sales of Wise and Foods and from the issuance
of  options on the common stock of the Consumer Adhesives business and of Borden
Decorative Products Holdings, Inc.  Receivable from Parent (shown as a reduction
in  the  Consolidated  Statements  of  Shareholders'  (Deficit) Equity) includes
accrued interest of $58,699, $0 and $10,120 related to these notes receivable at
December  31,  2002, 2001 and 2000.  Paid-in Capital includes the related net of
tax interest income of $38,154, $24,674 and $31,090 for the years ended December
31,  2002, 2001 and 2000.  In the Company's 2001 Annual Report on Form 10-K, the
Company  expressed  its  intention  to  cancel this note receivable, therefore a
valuation  allowance  was  placed  on the accrued interest at that date.  During
2002,  the  Company  decided  to  defer  canceling  the  note, and reversed this
valuation  allowance  and  resumed accruing the related interest.  Historically,
BHI  funded  the  payment  of  the interest on the note through common dividends
received  from the Company.  BHI has not made a payment on the accrued interest,
nor  has  the  Company  paid  an  associated  dividend  since  October 15, 2001.

During  2002 the Company granted 1,587,301 shares of restricted stock to certain
management  members.  The shares become unrestricted on the third anniversary of
the  grant  date.  Deferred compensation expense of $3,571 related to this grant
is being amortized over the three-year vesting period. At December 31, 2002, the
unamortized  deferred  compensation  was  $2,679.

BHI  contributed  tax  benefits  to  the Company of $20,890, $21,038 and $44,045
during  2002,  2001  and  2000,  respectively.  The  Company  is included in its
parent's  tax  return  and the deductible interest expense on the parent's notes
payable  reduces  the  Company's  tax  liability.  During 2002, the Company also
recorded  a  capital contribution from BHI of $3,550 (net of tax) related to the
allocation  of  Capital wind-down costs to the Company, which the Company has no
responsibility  to  fund  (see  Note  22).

In  addition  to  the  contribution of the tax benefits, discussed above, during
2001  the Company's parent contributed Preferred Stock and accumulated dividends
totaling  $620,922  and $17,000 of cash as a capital contribution in conjunction
with  the  Corporate  Reorganization.

During  1996  the Company sold an option to BWHLLC to purchase what was then all
of  the  common  stock of the Consumer Adhesives business for $54,120, which was
110%  of  the  August 16, 1996 fair market value of the common stock. The option
was  issued at fair value with a five-year expiration.  During 2000, the Company
made  a  capital contribution to the Consumer Adhesives business in exchange for
additional shares of stock.  On August 13, 2001, the option was exercised and an
affiliate  of  the  Company  purchased  the remaining 26% of Consumer Adhesives'
common shares issued in 2000, for $40,000.  The related pre-tax gain of $132,275
($94,847 after-tax) was recorded in paid-in capital as of December 31, 2001 (see
Note  1).
The  Corporate Reorganization resulted in the issuance of shares of common stock
of  the  Company  and  warrants  to  purchase common stock to certain management
members,  in  exchange  for  the  shares they held in BCHI.  This resulted in an
increase  to  paid-in  capital  for  $1,236,  the value of the minority interest
liability  that  represented  their  previous  interest  in  BCHI.

During 2000, the Company distributed 100% of its ownership in the infrastructure
management  services  business  to  the  Company's parent.  The distribution was
recorded  at  net book value of $16,277, including $8,557 owed by the Company to
the infrastructure management services business in accordance with a tax sharing
agreement.  Subsequent  to  the distribution, substantially all of the assets of
the  infrastructure  management  services  business were sold to a subsidiary of
Interliant,  Inc.  Subsequent  to  this  sale,  the  remaining  assets  of  the
infrastructure management services business, with a net book value of $307, were
contributed  back  to  the  Company  from  the  Company's  parent.

The  Company  recorded  a  net  of  tax  minimum pension liability adjustment of
$17,075,  $66,580  and  ($1,779) for 2002, 2001 and 2000, respectively, relating
to  underfunded  pension  plans,  which  is  reflected  in  accumulated  other
comprehensive  income.

17.      STOCK  OPTION  PLANS  AND  OTHER  STOCK  BASED  COMPENSATION

Stock  Options
--------------
Beginning  in  1996,  key subsidiaries of the Company issued stock options under
their  individual Stock Purchase and Option Plans for Key Employees. Under these
plans,  equity  in  the Chemical and infrastructure management services business
units  was sold to key management personnel. Fixed stock options were granted to
purchase  additional  shares  at  exercise  prices  between  $5.00 and $7.50. In
addition,  each  company  granted  fixed  stock options to employees under their
respective  broad-based  option  plans.  The  options  were issued with exercise
prices  at  or  above  fair  market  value,  with  vesting  over  five  years.

The  options  granted  to  Chemical  employees  became  options  of  the Company
effective  with the Corporate Reorganization.  The conversion of Chemical shares
and  options provided Chemical management with equivalent intrinsic value in the
Company  at  the new measurement date.  Accordingly, no compensation expense was
recorded.  The  strike  prices  of these options have a range of $4.13 to $5.00,
which  exceeds  estimated  fair  market  value.

During  2002,  an  additional  1,492,000  options were granted to key employees,
including  1,176,000  performance  options.  The  2002  options have an exercise
price  of $2.25 per share, and were granted at estimated fair market value.  The
performance options vest after the fifth anniversary of the grant date, however,
vesting  is  accelerated  upon  the  achievement of certain EBITDA targets.  The
remaining  options  vest  ratably  over  five  years.  In  accordance  with FASB
Interpretation  No.  44  ("FIN44")  options  granted  after July 1, 2001 require
variable  accounting.  The  expense  relating to these options for 2002 was $14.
As of December 31, 2002 there are 3,426,040 options outstanding on the Company's
common  stock  and  5,897,559  shares  available  for  future  grants.

The  liability  for  options  relating to the infrastructure management services
business  was  included  in the distribution of this business, and these options
were  subsequently  exercised  upon  the  sale of that business by the Company's
parent.

The  Company  accounts  for  stock-based  compensation  under APB No. 25 and has
adopted  the  disclosure-only  provisions  of  SFAS  No.  123  "Accounting  for
Stock-Based  Compensation".  To  determine  compensation  cost  for  2002 option
grants  according  to  SFAS  No.  123,  the  fair  value of each option grant is
estimated  on  the  date  of grant using the Black-Scholes options pricing model
with  a  risk-free  weighted average interest rate of 5.0% and expected lives of
five  years.  The  2001  Corporate  reorganization resulted in a new measurement
date  for  the  options  outstanding  at  that  time  for  purposes of measuring
compensation expense.  To determine compensation cost according to SFAS No. 123,
the fair value of each option was estimated as of the measurement date using the
Black-Scholes  option-pricing  model  with a risk free weighted average interest
rate  of  4.37%  and  expected  lives  of  five  years (See  Note  3).
















Information  regarding  the  management stock option plans for the Company is as
follows:

<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------------------
                                                         2002                          2001                         2000
                                                ----------------------        ----------------------        ----------------------
                                                          Weighted                       Weighted                       Weighted
                                                          Average                        Average                        Average
                                                          Exercise                       Exercise                       Exercise
                                               Shares     Price                Shares    Price              Shares      Price
----------------------------------------------------------------------------------------------------------------------------------
<S>                                             <C>          <C>                <C>        <C>               <C>         <C>
Options outstanding, beginning of year       6,871,380    $ 4.38             4,382,500    $ 5.43            5,380,155   $  5.37
     Options exercised                           -           -                  -           -                   -           -
     Options granted                         1,492,000      2.25                -           -                   -           -
     Option conversion                           -           -               4,451,880      4.38                -           -

     Options relating to distributed
     business                                    -           -                  -           -                (564,655)     5.00
     Options forfeited                      (4,937,340)     4.28            (1,963,000)     5.09              (433,000)    5.22
     Options outstanding end of year         3,426,040      3.59             6,871,380      4.38             4,382,500     5.43
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>


The  option  conversion  relates  to  the increase in options as a result of the
Corporate Reorganization (see Note 5).  Options relating to distributed business
represents options for the infrastructure management services business which was
distributed  to  the  Company's  parent  during  2000  (see  Note  22).

At  December  31, 2002 there were 1,472,824 options exercisable, with a range of
exercise  prices  of  $4.13 to $5.00, a weighted average exercise price of $4.51
and  a  weighted  average remaining life of 4 years.  At December 31, 2001 there
were  5,213,104 options exercisable, with a range of exercise prices of $4.13 to
$5.00,  a  weighted  average  exercise  price  of  $4.26  and a weighted average
remaining  life  of  5  years.

Unit  Appreciation  Rights
--------------------------
Certain  current  and  former  employees  of  the Company hold unit appreciation
rights  ("UAR's") granted by the Company in BWHLLC during the years 1996 - 2000.
The  UAR's  have a ten-year life with vesting periods ranging from 4 to 5 years.
The  UAR's  are  accounted  for  under  the  liability  method  as prescribed by
Accounting  Principles  Board  Opinion  No.  25, "Accounting for Stock Issued to
Employees"  ("APB No. 25"), and any compensation expense incurred in conjunction
with  the  UAR's  will  be  reflected  in  the  Statements of Operations for the
Company.  For 2002, 2001 and 2000, the Company has not recorded any compensation
expense  attributable  to the UAR's.  There were 13,383,461 UAR's outstanding at
December  31,  2002  and  no  UAR's  available  for  future  grants.

18.     DERIVATIVE  FINANCIAL  INSTRUMENTS

The effect on the Company's other Comprehensive income from adoption of SFAS No.
133  as  of  January  1,  2001  was  a  charge of $5,200 ($3,300 net of tax), as
discussed  further  in  Note  10.  As  of  December  31,  2002,  the Company had
derivative  liabilities  of  $402  classified  as  other current liabilities and
derivative  gains  of  $16  classified  as  other  assets.

Interest  Rate  Swaps
---------------------
The  Company  enters  into  interest rate swaps to alter interest rate exposures
between  fixed  and floating rates on long-term debt. Under interest rate swaps,
the  Company  agrees with other parties to exchange, at specified intervals, the
difference  between  fixed rate and floating rate interest amounts calculated by
reference  to  an  agreed  notional  principal  amount.  The  notional amount of
interest  rate  swaps  was  $0  at December 31, 2002 and $24,286 at December 31,
2001.  The  remaining swap at December 31, 2001 matured on December 1, 2002. The
net  impact  of  interest  rate  swaps was an increase in the Company's interest
expense  of $2,566 in 2002, $2,215 in 2001 and $6,663 in 2000. The year-end fair
value  of  the  interest  rate  swap  was a loss of $2,711 at December 31, 2001.















The following table summarizes the weighted average interest rates for the swaps
used  by the Company.  Variable rates change with market conditions and may vary
significantly  in  the  future.

<TABLE>
<CAPTION>

---------------------------------------------------------------------------------------------------
                                                   2002               2001                2000
---------------------------------------------------------------------------------------------------
<S>                                                 <C>                <C>                   <C>
Pay fixed swaps
Average rate paid                                  13.7%             13.7%                 10.5%
Average rate received                               1.9%              4.5%                  6.3%
---------------------------------------------------------------------------------------------------
</TABLE>


An  interest  rate swap, having a notional amount of $200,000, no longer met the
criteria  for  hedge accounting and was marked to market prior to termination on
September  1,  2000. On that date the Company recognized a gain of $4,902 in the
Consolidated  Statement  of  Operations.

Foreign  Exchange
-----------------
International  operations  account  for  a  significant portion of the Company's
revenue  and operating income. It is the policy of the Company to reduce foreign
currency  cash  flow  exposure  due  to  exchange  rate  fluctuations by hedging
anticipated  and  firmly  committed  transactions wherever economically feasible
(within the risk limits established in the Company's policy). The Company enters
into  forward  and  option  contracts to buy and sell foreign currencies only to
reduce  foreign  exchange  exposure  and  protect  the U.S. dollar value of such
transactions  to  the  extent of the amount under contract.  These contracts are
part  of  a  worldwide  program  to minimize foreign currency exchange operating
income  and  balance  sheet  exposure.

Gains  and  losses  arising  from  contracts are recognized on a quarterly basis
through the Consolidated Statement of Operations (see Note 3).  The Company does
not  hold  or  issue  derivative  financial  instruments  for  trading purposes.

At  December  31,  2002  and  2001,  the  Company  had  $60,079  and  $50,987,
respectively,  of  notional value of forward foreign currency exchange contracts
outstanding. The unsecured contracts mature within 12 months and are principally
with  banks.  The  Company  is  exposed  to  credit  loss  in  the  event  of
non-performance by the other parties to the contracts. The Company evaluates the
credit worthiness of the counterparties' financial condition and does not expect
default  by  the  counterparties.

Option  and  Commodity  Future  Contracts
-----------------------------------------
The  Company  is  exposed  to  price  fluctuations associated with raw materials
purchases,  most  significantly  with  methanol,  phenol  and  urea.  For  these
commodity raw materials, the Company has purchase contracts, with periodic price
adjustment  provisions.  The Company also adds selling price provisions that are
indexed  to publicly available indices on customer contracts for these commodity
raw  materials.  The  Board  of  Directors  approves  all  commodity futures and
commodity  commitments.

In  the  fourth  quarter  of  2000,  the  Company entered into fixed rate, fixed
quantity contracts to secure a portion of future natural gas usage at certain of
the  Company's  facilities.  The  contracts were entered into to partially hedge
the  Company's risk associated with natural gas price fluctuations in peak usage
months through March 2003.  Gas purchases under these contracts totaled $671 and
$853  in  2002 and 2001, with $402 and $1,073 future commitments at December 31,
2002  and  2001,  respectively.

Additionally,  the  Company  expanded its natural gas hedging activities in June
2001  to hedge a portion of natural gas purchases for all of North America.  The
Company  entered  into  futures  contracts with varying settlement dates through
November  2002 to purchase natural gas.  The contracts are settled for cash each
month  based  on the closing market price on the last day the contract trades on
the  New  York  Mercantile  Exchange.  Commitments settled under these contracts
totaled $1,210 and $1,716 in 2002 and 2001, respectively and related losses were
$264  and  $610  in 2002 and 2001.  There were no future commitments under these
contracts  at  December  31, 2002 and $520 of future commitments at December 31,
2001.

Gains and losses on commodity futures contracts are recognized each month as gas
is  used.  Future  commitments  are  marked to market on a quarterly basis.  The
Company  also  recorded a gain of $16 and a loss $545 for the difference between
the  fair value and carrying value of future natural gas commitments at December
31,  2002  and  2001,  respectively.




19.     FAIR  VALUE  OF  FINANCIAL  INSTRUMENTS

The following table presents the carrying or notional amounts and fair values of
the  Company's  financial  instruments  at  December 31, 2002 and 2001. The fair
value  of a financial instrument is the estimated amount at which the instrument
could  be exchanged in a current transaction between willing parties, other than
in  a  forced or liquidation sale. Fair values are determined from quoted market
prices  where  available  or  based  on  other  similar  financial  instruments.

The carrying amounts of cash and cash equivalents, accounts receivable, accounts
payable  and  other  accruals  are considered reasonable estimates of their fair
values.  The  carrying  value  of  the  loans  receivable  from  and  payable to
affiliates  approximates  fair  values  as  management  believes  the loans bear
interest  at  market  interest  rates.

The  following  table includes financial instrument carrying and fair values for
the  Company.
<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------
                                               2002                                     2001
                                 ------------------------------            ------------------------
                                    Carrying          Fair                   Carrying         Fair
                                     Amount          Value                    Amount         Value
                                   -------------  ----------               -------------  ---------
<S>                                   <C>             <C>                      <C>             <C>
Nonderivatives
Assets
     Investment securities        $    -            $  -                   $  110,000    $  110,000

Liabilities
     Debt                            526,066          345,048                 535,575       368,999

                                    Notional          Fair                   Notional         Fair
                                     Amount          Value (Loss)              Amount      Value (Loss)
                                   -------------    ------------           -------------   ---------
Derivatives relating to:
Foreign currency contracts - loss $   60,079        $    (402)             $   50,987    $      (87)
Interest rate swaps - loss             -               -                       24,286        (2,711)
---------------------------------------------------------------------------------------------------
</TABLE>


20.     SUPPLEMENTAL  INFORMATION

<TABLE>
<CAPTION>

----------------------------------------------------------------
                                2002         2001        2000
----------------------------------------------------------------
<S>                             <C>           <C>           <C>
Depreciation                 $  46,392    $  53,996   $  51,519
Amortization                     1,555        5,365       4,172
Research and Development        19,080       22,717      22,202
----------------------------------------------------------------
</TABLE>



21.     SEGMENT  AND  GEOGRAPHIC  DATA

Beginning in 2002, the Company reports three operating segments rather than one,
as  previously  reported,  to  better reflect the ongoing internal organization.
Prior  years  have  been  restated  to  reflect this change.  The three segments
reported  are  North American Forest Products, North American Performance Resins
Group  and  International.  In  addition,  Corporate  and  Other  is  reported
separately.  The  product  lines  included in the North American Forest Products
segment  are  formaldehyde and forest products resins.  The key business drivers
in  the  North  American  Forest  Products segment are housing starts, furniture
demand, panel production capacity and chemical sector operating conditions.  The
North  American  Performance  Resins  Group  includes  specialty,  oilfield,
industrial,  nonwoven,  laminate  and  foundry  resins, and UV coatings.  In the
North  American  Performance  Resins Group segment, the key business drivers are
housing  starts,  auto  builds, active gas drilling rigs, fiber optic demand and
the general industrial sector.  The International segment consists of operations
in Latin America, Europe and Asia Pacific.  Principal countries of operation are
Brazil,  the  United  Kingdom,  Malaysia  and  Australia.  Product lines include
forest  product  and  performance resins.  In the International segment, the key
business  drivers  are export levels, panel production capacity, housing starts,
furniture  demand  and  the  local  political  environment.  Corporate and Other
represents  general  and administrative expenses and income and expenses related
to  divested  businesses.

In  the  consolidated  financial  information that follows, the businesses sold,
distributed  or  discontinued  classification  includes  the  Company's melamine
crystal  business,  which  facility  was  closed on January 11, 2002.  Operating
results  subsequent  to  the closure date represent revenue and related expenses
from  the  sale  of  inventory.  The  classification also includes the Company's
printing  inks  business  through  the  date  of  its  sale  in  2000  and  the
infrastructure  management  services  business  prior to its distribution to the
Company's  parent  in  2000.

EBITDA  information  is presented with the Company's segment disclosures because
it  is  a  primary  measure  used  by the Company to evaluate operating results.
EBITDA  represents  the  sum  of  Operating  Income  (loss) and depreciation and
amortization  presented  in  the  tables  below.


OPERATING  SEGMENTS:
--------------------
<TABLE>
<CAPTION>

SALES  TO  UNAFFILIATED  CUSTOMERS:

---------------------------------------------------------------------------------------------------
                                             2002                   2001                 2000
---------------------------------------------------------------------------------------------------
<S>                                          <C>                     <C>                   <C>
North American Forest Products          $  634,619              $  656,694            $  610,183
North American Performance Resins          340,791                 409,081               386,187
International                              264,541                 282,629               314,852
Businesses sold or distributed               7,934                  23,737                66,623
                                        -------------           ------------           ------------
                                        $1,247,885              $1,372,141            $1,377,845
---------------------------------------------------------------------------------------------------
</TABLE>


<TABLE>
<CAPTION>

OPERATING  INCOME  (LOSS):

---------------------------------------------------------------------------------------------------
                                             2002                   2001                 2000
---------------------------------------------------------------------------------------------------
<S>                                          <C>                     <C>                    <C>

North American Forest Products          $  72,302               $   83,559            $   38,447
North American Performance Resins          32,106                   59,923                84,551
International                              12,388                  (16,671)               (7,210)
Corporate and other                       (75,883)                 (88,367)              (68,300)
Businesses sold or distributed             (7,205)                (113,939)               (8,749)
                                        -------------           ------------           ------------
                                        $  33,708               $  (75,495)           $   38,739
---------------------------------------------------------------------------------------------------
</TABLE>

<TABLE>
<CAPTION>

DEPRECIATION  AND  AMORTIZATION  EXPENSE:
---------------------------------------------------------------------------------------------------
                                             2002                   2001                 2000
---------------------------------------------------------------------------------------------------
<S>                                           <C>                   <C>                  <C>
North American Forest Products          $  19,259               $   19,950            $   18,514
North American Performance Resins           9,929                   11,314                 9,394
International                              10,305                   11,766                11,634
Corporate and other                         8,454                    9,021                 8,237
Businesses sold or distributed                -                      7,310                 7,912
                                        -------------           ------------           ------------
                                        $  47,947               $   59,361            $   55,691
---------------------------------------------------------------------------------------------------
</TABLE>

















<TABLE>
<CAPTION>

EBITDA:
---------------------------------------------------------------------------------------------------

                                             2002                   2001                 2000
---------------------------------------------------------------------------------------------------
<S>                                          <C>                     <C>                    <C>
North American Forest Products          $  91,561               $  103,509            $   56,961
North American Performance Resins          42,035                   71,237                93,945
International                              22,693                   (4,905)                4,424
Corporate and other                       (67,429)                 (79,346)              (60,063)
Businesses disposed of                     (7,205)                (106,629)                 (837)
                                        -------------           ------------           ------------
TOTAL EBITDA                            $  81,655               $  (16,134)           $   94,430
                                        =============           ============           ============
</TABLE>


<TABLE>
<CAPTION>


TOTAL  ASSETS  AT  YEAR  END:
---------------------------------------------------------------------------------------------------
                                              2002                   2001                 2000
---------------------------------------------------------------------------------------------------
<S>                                           <C>                     <C>                 <C>
North American Forest Products          $  329,574               $  319,846            $  375,568
North American Performance Resins          205,385                  211,477               202,454
International                              205,612                  247,380               290,147
Corporate and other                        270,976                  329,280               399,995
Businesses sold or distributed                 233                   15,295               123,809
Discontinued Operations                       -                        -                  128,624
                                         -------------           ------------          ------------
                                        $1,011,780               $1,123,278            $1,520,597
---------------------------------------------------------------------------------------------------
</TABLE>

<TABLE>
<CAPTION>

CAPITAL  EXPENDITURES:
---------------------------------------------------------------------------------------------------
                                              2002                   2001                 2000
---------------------------------------------------------------------------------------------------
<S>                                            <C>                   <C>                   <C>
North American Forest Products            $ 17,322               $    9,791            $   44,376
North American Performance Resins           13,744                   11,577                10,306
International                                5,691                   15,660                31,859
Corporate and other                          2,016                    5,016                 9,880
Businesses sold or distributed                 -                        604                 2,840
Discontinued operations                        -                      4,760                 5,288
                                         -------------           ------------          ------------
                                          $ 38,773               $   47,408            $  104,549
---------------------------------------------------------------------------------------------------
</TABLE>


The  Company  reports  and manages its business through three operating segments
which  do  cross  geographic boundaries.  The following tables reflect sales and
long-lived  assets  by  major  geographic  area:

<TABLE>
<CAPTION>

SALES  TO  UNAFFILIATED  CUSTOMERS:  (1)

---------------------------------------------------------------------------------------------------
                                              2002                   2001                 2000
---------------------------------------------------------------------------------------------------
<S>                                           <C>                   <C>                    <C>
United States                             $ 812,667              $  908,427            $  907,168
Canada                                      170,677                 181,085               155,825
Other International                         264,541                 282,629               314,852
                                         -------------           ------------          ------------
Total                                     $1,247,885             $1,372,141            $1,377,845
---------------------------------------------------------------------------------------------------
<FN>

(1)  For purposes of geographic disclosures, sales are attributed to the country
in  which  individual  business  locations  reside.
</TABLE>

<TABLE>
<CAPTION>

LONG-LIVED  ASSETS:  (2)
---------------------------------------------------------------------------------------------------
                                              2002                   2001                 2000
---------------------------------------------------------------------------------------------------
<S>                                            <C>                   <C>                   <C>

United States                             $  276,514             $  283,423            $  364,502
Canada                                        51,042                 53,913                60,783
Other International                          112,182                120,221               130,880
                                         -------------           ------------          ------------
Total                                     $  439,738             $  457,557            $   556,165
---------------------------------------------------------------------------------------------------
<FN>

(2)  Long-lived assets include property, plant and equipment, net of accumulated
depreciation.
</TABLE>



22.     RELATED  PARTY  TRANSACTIONS

Corporate  Reorganization  Transactions
---------------------------------------

The Corporate Reorganization included certain financial transactions between the
Company  and  its  parent  (see  Note  5).

Financing  and  Investing  Arrangements
---------------------------------------

Borden  Foods  Holding Corporation ("Foods"), an affiliate of the Company, loans
cash  to  the  Company,  under  an  Affiliate Borrowing Agreement. The loans are
evidenced  by a demand promissory note with interest at a variable rate per year
equal  to  the  daily  operating Fed Funds Rate as reported by "Telerate" (or an
agreed  upon  alternative  reporting  system)  on  each  day  the  note  remains
outstanding.  Interest  is  calculated on the daily unpaid principal balance and
is  paid  on Friday of each week and on the last day of each month.  These loans
are  recorded as loans payable to affiliates in the Consolidated Balance Sheets.
Foods had $84,680 at an interest rate of 1.3125% and $78,550 at an interest rate
of  2.125%  loaned  to  the  Company  at  December  31,  2002,  2001  and 2000,
respectively.  The  Company  recorded  affiliated  interest  expense  of $1,857,
$14,538  and $20,963 related to amounts loaned by affiliates for the years ended
December  31,  2002,  2001 and 2000, respectively.  The significant reduction in
affiliated interest expense is due to lower average borrowings by the Company in
2002.

As  a  guarantor  of  the  Company's debt, Foods received an annual fee from the
Company  of $1,050 in 2001 and 2000.  Under the terms of the guarantee agreement
between  Foods  and  the  Company,  Foods  was  automatically  released from the
obligation  to  guarantee the payment of the Company's outstanding publicly held
debt  upon  Foods being released from the obligation to guarantee the payment of
amounts  due  under the Company's $250,000 Credit Agreement that expired on July
13,  2002.

In  the  first  quarter of 2002, the Company settled in full its note payable to
BCPM  (the "Note") in the form of cash payments of $31,581 and $2,600 of certain
set-offs  asserted  by  the  Company  against  amounts due under the Note.  BCPM
acknowledged  the  validity  and  enforceability  of  certain  set-offs asserted
against  amounts due under the Note by the Company; the Company waived the right
to  assert  certain  other set-offs against amounts due under the Note; and BCPM
and the Company exchanged mutual releases with respect to the Note.  A committee
comprised  solely  of  independent directors of BCPM, represented and advised by
separate  and  independent counsel, reviewed and agreed to the above provisions
(See  Note  4).

In  the Company's 2001 Annual Report on Form 10-K, the Company expressed that it
intended  to  cancel a $404,817 note receivable (plus accrued interest) from its
parent,  BHI,  which  is accounted for as a reduction from equity.  In the third
quarter  of  2002,  the Company decided to defer canceling this note receivable.
Historically, BHI funded the interest due the Company on the note through common
dividends  received  from the Company.  The Company continues to accrue interest
on  the  note  receivable,  however, quarterly interest has not been paid, since
October  15,  2001.

At  December  31, 2001, the Company had a $110,000 preferred stock investment in
Consumer  Adhesives,  an  affiliate  of  the  Company.  The  preferred stock was
redeemed  on  March  1,  2002  for  a  $110,000  note  receivable  from Consumer
Adhesives.  On  March  12,  2002,  the  note  receivable  was  sold  to BHI, the
Company's  parent,  for cash proceeds of $110,000 plus accrued interest of $455.

In  the  third  quarter  2000 the Company entered into a $40,000 credit facility
with  WKI  maturing  on December 31, 2000.  This facility was extended through a
series  of  amendments  through  April  16, 2001.  Effective April 12, 2001 this
facility was amended and restated extending the maturity date to March 31, 2004.
The  facility  was further amended effective July 2, 2001 to increase the amount
available  to $50,000.  In accordance with the terms of the restated and amended
agreement,  the  facility  was  reduced  to  $25,000 on August 12, 2001 with the
perfection  of  certain  pledged  collateral.  The  Company  received  a  second
priority  lien  on  that  same  collateral.  On  September  25, 2001 the Company
extended  an  additional  $3,000  unsecured  credit  facility to WKI maturing on
October  25, 2001.  That facility was increased to $13,000 effective October 26,
2001  maturing on December 28, 2001.  No borrowings occurred under the unsecured
facilities  and  the  facility  was  transferred  to  the  Company's  parent  in
conjunction  with  the  Corporate  Reorganization  (See  Note  5).

Administrative  Service,  Management  and  Consulting  Arrangements
-------------------------------------------------------------------

Prior  to  the Corporate Reorganization, KKR rendered management, consulting and
board services to the Company for an annual fee of $10,000, payable quarterly in
arrears.  The  2001  fee  through  the  date of the Corporate Reorganization was
$9,167.  At December 31, 2001, $1,667 is included in accounts payable to Capital
for  the  two  months  of  fourth  quarter  2001  fees  prior  to  the Corporate
Reorganization.  Effective with the Corporate Reorganization, the Company was no
longer  charged  directly  for  any  KKR  fees.  However,  with the cessation of
operations  by  Capital  (discussed  below),  in  2003  KKR will provide certain
management,  consulting and board services directly to the Company for an annual
fee  of  $3,000.

As  a  result  of  the  Corporate  Reorganization  in  2001,  Capital  provided
management,  consulting  and  board  services  to  the  Company, and the Company
provided  certain  administrative  services  to  Capital.  Capital  charged  the
Company  an annual fee of $9,000, payable quarterly in arrears, which represents
the  net  amount  of  Capital's  services  less  the Company's cost of providing
administrative  services  to  Capital.  Charges  incurred  for one month of such
services in 2001 subsequent to the Corporate Reorganization were $750.  Included
in  accounts  payable  was  $2,250  and  $1,711  at  December  31, 2002 and 2001
respectively  for  the annual fee due to Capital under this arrangement.  During
2002  the Company's parent made a decision to cease the operations of Capital by
the  end  of  the  first  half of 2003.  This decision resulted in the immediate
recognition by Capital of incremental expenses and liabilities related primarily
to  severance  and  rent  obligations.  These incremental expenses are the legal
obligation  of  Capital  and  will  be  funded by Capital and the Company is not
responsible  for settling these liabilities.  The Company's allocated portion of
Capital's  incremental costs is $5,500 and has been recognized by the Company as
additional  management  fee  for  financial  reporting  purposes with the offset
recorded  as  a  capital  contribution  to  the  Company,  by  BHI.

The  Company  incurs  certain  costs  on  Capital's  behalf and is reimbursed by
Capital  for  100%  of these costs.  Included in accounts receivable at December
31,  2002  and  2001  is  a  $2,298  and  $554  receivable  for  these expenses.

The  Company provides administrative services to Foods under a revised agreement
effective for 2002.  The total fee under this agreement is based on the level of
services  provided, which was significantly reduced from those services provided
in  2001.  Additionally, the Company also provided services to Wise prior to its
sale by BWHLLC in 2000.  Fees received for these services are offset against the
Company's  general  and  administrative  expenses,  and totaled $120, $1,000 and
$1,167  for  the  years  ended  December  31, 2002, 2001 and 2000, respectively.

In  2001  and  2000,  the  Company rendered management, consulting and financial
services  to  World  Kitchen  Holding Company, Inc. ("WKI"), an affiliate of the
Company,  for  an  annual  fee  of  $2,500  depending  upon WKI reaching certain
operating  criteria.  In  addition,  WKI also reimbursed the Company for certain
expenses paid on its behalf.  In November 2001, Capital purchased the management
fee  receivable of $1,667 from the Company plus receivables for expenses paid on
WKI's  behalf  in  the  amount  of  $1,927.  Total  fees  received  under  this
arrangement  were  $0  and $2,500 for 2001 and 2000, respectively and are offset
against  the  Company's  general  and  administrative  expenses.

Other  Transactions  and  Arrangements
--------------------------------------

Prior  to  Consumer  Adhesives  Sale  (See  Note  1),  the  Company and Consumer
Adhesives  were  parties  to  a  tax  sharing  agreement.  Under this agreement,
Consumer  Adhesives  paid  income  taxes to the Company as if Consumer Adhesives
filed  stand-alone  federal and state income tax returns.  At December 31, 2002,
Consumer  Adhesives had no liability to the Company for unpaid federal and state
income  tax.

During  2001,  the  Company  received  payments  of  $ 11,802 from Foods for its
calculated portion of the Company's net pension liability. In the fourth quarter
of  2001,  the  Company  received $12,302 from Foods to assume the liability for
payment  of  claims made under essentially all of Foods' employee benefit plans.
As  of  December  31,  2001, the Company owed $106 to Foods for reimbursement of
payments  made  on  its  behalf.  No  amounts were owed to Foods at December 31,
2002.

As  described in Note 8, the Company acquired certain assets from BCP in 2000. A
wholly owned subsidiary of the Company serves as the general partner of BCP (See
Note 4). The purchase price of these assets is considered to be at fair value as
determined by an independent appraisal.  During 2002, 2001 and 2000, the Company
purchased  $2,012,  $11,026  and  $102,540  of  raw materials from BCP. In
addition,  the  Company paid $25,330 in 2000 to BCP to exit certain raw material
purchase  contracts.

In  February  2000,  the  Company  distributed  100%  of  its  ownership  in the
infrastructure  management  services  business  to  the  Company's  parent.  The
distribution was recorded at net book value of $16,277, including $8,557 owed by
the  Company  to  the  infrastructure management services business in accordance
with a tax sharing agreement.  Subsequent to the distribution, substantially all
of  the assets of the infrastructure management services business were sold to a
subsidiary  of  Interliant,  Inc.  in  exchange for $2,500 in cash and 1,041,179
shares of Interliant, Inc. stock.  In June 2000, the remaining net assets of the
infrastructure management services business, with a net book value of $307, were
contributed  back  to  the  Company  from  the  Company's  parent.

23.     GUARANTEES  AND  INDEMNIFICATIONS

Standard  Guarantees  /  Indemnifications
-----------------------------------------

In  the ordinary course of business, the Company enters into numerous agreements
that contain standard guarantees and indemnities whereby the Company indemnifies
another  party  for,  among  other  things,  breaches  of  representations  and
warranties.  Such  guarantees  or  indemnifications  are  granted  under various
agreements,  including  those  governing  (i)  purchases  and sales of assets or
businesses,  (ii)  leases  of  real  property,  (iii)  licenses  of intellectual
property  and  (iv)  long-term  supply  agreements.  The  guarantees  or
indemnifications issued are for the benefit of the (i) buyers in sale agreements
and sellers in purchase agreements, (ii) landlords in lease contracts, and (iii)
licensees  in  license  agreements  and  (iv)  customers  in  long-term  supply
agreements.

In addition, these parties may also be indemnified against any third party claim
resulting from the transaction that is contemplated in the underlying agreement.
While  some  of  these guarantees extend only for the duration of the underlying
agreement,  many  survive  the expiration of the term of the agreement or extend
into  perpetuity  (unless subject to a legal statute of limitations).  There are
no  specific limitations on the maximum potential amount of future payments that
the Company could be required to make under these guarantees, nor is the Company
able  to  develop an estimate of the maximum potential amount of future payments
to  be  made under these guarantees as the triggering events are not subject to
predictability.  With  respect  to certain of the aforementioned guarantees, the
Company  has  reimbursement  agreements  from  its  parent  entity, or maintains
insurance  coverage  that  mitigates  any  potential  payments  to  be  made.

In  addition  the  Company  has agreed to indemnify KKR for any claims resulting
from  its  services to the Company.  The indemnification does not expire and the
Company  is  not  able  to  determine  a  maximum  exposure under the agreement.
However,  the Company does have an indemnification agreement from its parent for
any  amounts  that  it  must  pay  under  the  KKR  indemnity  relating  to WKI.

Subsidiary  Guarantees
----------------------

The  Company  guarantees  the  bank debt of one of its Brazilian subsidiaries at
Banco  Itau  S.A.  up  to  a  maximum  U.S.  equivalent  of  US  $6,700.

Warranties
----------

The  Company  does  not make express warranties on its products, other than that
they  comply  with the Company's specifications, and therefore does not record a
warranty  liability.  Adjustments  for  product  quality  claims  in general are
handled  through  routine  procedures  and  charged  against sales revenues upon
occurrence.

24.     COMMITMENTS  AND  CONTINGENCIES

ENVIRONMENTAL  MATTERS  -  The  Company  like  others  in similar businesses, is
subject  to  extensive  Federal,  state  and  local  environmental  laws  and
regulations.  Although  environmental  policies  and  practices  are designed to
ensure  compliance  with  these  laws  and  regulations, future developments and
increasingly  stringent  regulation could require the Company to make additional
unforeseen  environmental  expenditures.  Accruals for environmental matters are
recorded  when  it is probable that a liability has been incurred and the amount
of  the  liability  can  be  reasonably  estimated.  Environmental  accruals are
routinely  reviewed  on  an interim basis as events and developments warrant and
are  subjected  to  a  comprehensive  review  annually  during the fiscal fourth
quarter.

 In  1987,  under an Environmental Indemnity Agreement (EIA) between the Company
and  BCP,  the Company agreed, subject to certain conditions and limitations, to
indemnify BCP from certain environmental liabilities incurred at BCP facilities,
which  were  previously owned by the Company, on or before November 30, 1987 and
share  on  an equitable basis those arising from facts or circumstances existing
and  requirements  in  effect  both prior to and after such date. On October 22,
2002  the United States Bankruptcy Court for the District of Delaware approved a
Settlement  Agreement  among  the  Company,  BCPOLP,  BCPM,  the  United  States
Environmental  Protection  Agency  and the Louisiana Department of Environmental
Quality,  where  the  company  agreed to perform certain of BCPOLP's obligations
with  respect  to  environmental conditions at BCPOLP's Geismar, Louisiana site.

The  Company  has accrued approximately $44,000 and $43,400 at December 31, 2002
and  2001,  respectively,  for  all  probable  environmental  remediation,
indemnification and restoration liabilities at approximately 55 locations, 35 of
which are active proceedings brought under CERCLA or similar state environmental
laws.  Of these amounts, $5,400 and $2,400 at December 31, 2002 and December 31,
2001,  respectively,  relate  to  environmental  remediation  and  restoration
liabilities that are included in the Company's business realignment reserve (See
Note  8).  This  is  management's  best  estimate of these liabilities. Based on
currently  available  information  and analysis, the Company believes that it is
reasonably  possible  that  costs  associated  with  such liabilities may exceed
current  reserves by amounts that may prove insignificant, or by amounts, in the
aggregate,  of  up  to  approximately  $39,000.

Because the Company's operations involve the use, handling, processing, storage,
transportation  and  disposal  of hazardous materials, the Company is subject to
extensive environmental regulation at the Federal and State level and is exposed
to  the  risk  of claims for environmental remediation or restoration as well as
claims  of injury from direct exposure to such materials or products produced by
the  Company  and from indirect exposure when such materials or its products are
incorporated  into other companies' products.  In addition, the Company's former
ink, wallcoverings, film, phosphate mining and processing, thermoplastics, food,
dairy  and  other  manufacturing operations,  were also subject to environmental
regulations  and  posed  similar  risks  for  claims.  There can be no assurance
that,  as  a  result  of former, current or future operations, there will not be
additional  environmental  remediation  or  restoration liabilities or claims of
personal injury by employees or members of the public due to exposure or alleged
exposure  to  such  materials  or  to  the  Company's  products.

LEGAL  MATTERS  -  The  Company has recorded $3,045 and $2,794 in liabilities at
December  31,  2002  and  2001  respectively,  for  legal  costs in amounts that
management  believes are probable and reasonably estimable. Actual costs are not
expected  to  exceed  these  amounts.  In  addition,  there  has  been increased
publicity  about  asbestos  liabilities  faced by manufacturing companies.  As a
result  of  the bankruptcies of many asbestos producers, plaintiff attorneys are
increasing  their  focus  on  peripheral defendants, including the Company.  The
Company  believes it has adequate reserves and insurance and does not believe it
has  a  material  asbestos  exposure.

In  1998, pursuant to a merger and recapitalization transaction sponsored by The
Blackstone  Group ("Blackstone") and financed by Chase Manhattan Bank ("Chase"),
Borden Decorative Products Holdings, Inc. ("BDPH"), a wholly owned subsidiary of
the Company, was merged with an acquisition vehicle created by Blackstone, which
subsequently  merged  with  Imperial Wallcoverings to create Imperial Home Decor
Group  ("IHDG").  Blackstone  provided  $84,500  in  equity  and  Chase provided
$295,000  in  senior  financing.  Borden received approximately $314,400 in cash
and 11% of IHDG common stock for its interest in BDPH.  On January 5, 2000, IHDG
filed  for  reorganization  under Chapter 11 of the U. S. Bankruptcy Code.  IHDG
emerged  from bankruptcy in April 2001.  The IHDG Litigation Trust (the "Trust")
was  created  pursuant  to  the plan of reorganization in the IHDG bankruptcy to
pursue  preference  and  other  avoidance  claims  on  behalf  of  the unsecured
creditors  of  IHDG.  In  November  2001,  the Trust filed a lawsuit against the
Company  and certain of its affiliates seeking to have the IHDG recapitalization
transaction  voided  as  a fraudulent conveyance and asking for a judgment to be
entered  against  the  Company  for  $314,400, plus interest, costs and attorney
fees.  Discovery  is  pending in the case with a cut-off currently scheduled for
December  2003.  The  Company  believes  it  has  strong defenses to the Trust's
allegations  and  intends  to defend the case vigorously.  The Company believes,
based  upon  the information it currently possesses, and taking into account its
established  reserves  for  estimated liability and its insurance coverage, that
the  ultimate  outcome  of  the foregoing proceedings and actions is unlikely to
have  a  material  adverse  effect  on  the  Company's  financial  statements.

OTHER  -  The  Company's  subsidiary,  BCP  Management, Inc. ("BCPM"), filed for
protection  under Chapter 11 of the United States Bankruptcy Code, in the United
States  Bankruptcy  Court for the District of Delaware  on March 22, 2002.  BCPM
has  served  as  the  general partner of Borden Chemicals and Plastics Operating
Limited  Partnership  ("the Partnership") which was created in November 1987 and
operated  as  a  commodity chemicals producer.  On April 3, 2001 the Partnership
filed  for  protection under Chapter 11 of the United States Bankruptcy Code, in
the United States Bankruptcy Court for the District of Delaware.  On February 5,
2003,  the  US  Bankruptcy  Court  approved  a Joint Plan of Liquidation for the
Partnership  and  BCPM (the "Joint Plan") which provides for the transfer of the
remaining  assets  of  both  entities, including preference, avoidance and other
claims  against  third  parties  (including the Company) to separate liquidating
agents  for  liquidation  and  distribution  to  their creditors.  The Company's
ownership  interest  in BCPM will be extinguished and no distributions from BCPM
to  the  Company are anticipated.  The Company recorded charges totaling $30,000
for calendar years 2000 and 2001 to reduce the value of the Company's investment
in  BCPM  to  zero.  No claims have been filed against the Company in connection
with  these bankruptcy proceedings; however, no assurance can be given that such
claims  will  not  be  made  in  the  future.

In 1992, the State of Sao Paolo Tax Bureau issued an assessment against the
Company's primary Brazilian subsidiary claiming that excise taxes were owed on
certain intercompany loans made for centralized cash management purposes,
characterized by the Tax Bureau as intercompany sales. Since that time the
subsidiary and the Tax Bureau have held discussions and the subsidiary has filed
an administrative appeal seeking cancellation of the assessment. In December
2001, the Administrative Court upheld the assessment in the amount of $R40,600,
including tax, penalties, monetary correction and interest, or approximately
$11,000. In September 2002, the subsidiary filed a second appeal with the
highest level administrative court, again seeking cancellation of the
assessment. The Company believes it has a strong defense against the assessment
and will pursue the appeal vigorously; however, no assurance can be given that
the assessment will not be upheld.











































































QUARTERLY  FINANCIAL  DATA  (UNAUDITED)

The  following  represents  Quarterly  Financial  Data  for  the  Company:
<TABLE>
<CAPTION>

2002 QUARTERS                                         FIRST (1)              SECOND                THIRD                 FOURTH
----------------------------------------------------------------------------------------------------------------------------------
<S>                                                     <C>                 <C>                   <C>                      <C>
Net sales                                         $   296,091          $    309,567            $  327,187            $  315,040
----------------------------------------------------------------------------------------------------------------------------------
Gross profit (2)                                       59,050                57,631                53,865                46,755
----------------------------------------------------------------------------------------------------------------------------------
Business realignment, and other impairments             4,659                 5,401                 2,082                 7,557
Loss on divestiture of businesses                        -                      -                     -                      -
----------------------------------------------------------------------------------------------------------------------------------
Income (loss) from continuing operations               (1,887)                2,698                 3,234               (10,803)
----------------------------------------------------------------------------------------------------------------------------------
Discontinued operations:
     Income from operations, net of tax                  -                      -                     -                      -
----------------------------------------------------------------------------------------------------------------------------------
Net income (loss)                                     (31,712)                2,698                 3,234               (10,803)
----------------------------------------------------------------------------------------------------------------------------------
Preferred stock dividends                                -                      -                     -                      -
----------------------------------------------------------------------------------------------------------------------------------
Net (loss) income applicable to common stock          (31,712)                2,698                 3,234               (10,803)
----------------------------------------------------------------------------------------------------------------------------------
Basic and diluted, per share of common stock:
Income (loss) from continuing operations                (0.01)                 0.01                  0.02                 (0.05)
Discontinued operations:
      Income from operations, net of tax                 -                      -                     -                      -
Net (loss) income applicable to common stock      $     (0.16)         $       0.01            $     0.02            $    (0.05)
Dividends per common share                               -                      -                     -                      -
Dividends per preferred share                            -                      -                     -                      -
Average number of common shares outstanding           199,158               199,361               199,416               200,964
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>


<TABLE>
<CAPTION>


2001 QUARTERS                                         FIRST                  SECOND                THIRD                 FOURTH(3)
----------------------------------------------------------------------------------------------------------------------------------
<S>                                                     <C>                 <C>                   <C>                      <C>
Net sales                                         $   361,097          $    377,836            $  336,8327            $  296,376
----------------------------------------------------------------------------------------------------------------------------------
Gross profit (2)                                       57,961                63,407                64,234                61,968
----------------------------------------------------------------------------------------------------------------------------------
Business realignment, and other impairments            (4,056)               13,956                10,696               105,812
Loss on divestiture of businesses                        -                      -                   2,177                   126
----------------------------------------------------------------------------------------------------------------------------------
Income (loss) from continuing operations                  375               (27,468)                2,950              (112,461)
----------------------------------------------------------------------------------------------------------------------------------
Discontinued operations:
     Income from operations, net of tax                   470                 5,739                 4,370                 1,225
----------------------------------------------------------------------------------------------------------------------------------
Net income (loss)                                         845               (21,729)                7,320              (111,236)
----------------------------------------------------------------------------------------------------------------------------------
Preferred stock dividends                              18,431                18,431                18,431                 6,553
----------------------------------------------------------------------------------------------------------------------------------
Net (loss) income applicable to common stock          (17,586)              (40,160)              (11,111)             (117,789)
----------------------------------------------------------------------------------------------------------------------------------
Basic and diluted, per share of common stock:
Income (loss) from continuing operations                 -                    (0.14)                 0.01                 (0.56)
Discontinued operations:
      Income from operations, net of tax                 -                     0.03                  0.02                   0.01
Net (loss) income applicable to common stock            (0.09)                (0.20)                (0.06)                 (0.59)
Dividends per common share                               0.06                   -                    0.12                   -
Dividends per preferred share                     $      0.75          $       0.75            $     0.75             $     0.27
Average number of common shares outstanding           198,975               198,975               198,975               199,070
----------------------------------------------------------------------------------------------------------------------------------
<FN>

(1)     As  described  in Note 6, the Company recorded a goodwill impairment charge of $29,825 in the first quarter
to  reduce  by  100%  the  carrying  amount as of January 1, 2002 of its European reporting unit.  There was no tax
benefit  recognized  in  conjunction  with  the  impairment  charge.
(2)     Gross  profit  is  defined  as  gross  margin  less  distribution  expense.
(3)     As  described  in  Note  8,  the  Company's fourth quarter 2001 results include a $98,163 impairment charge
related to the shut-down of the melamine crystal plant and a $19,028 charge related to a previously owned business.
</TABLE>








                          INDEPENDENT AUDITORS' REPORT




To  the  Board  of  Directors
and  Shareholders  of  Borden  Chemical,  Inc.


We have audited the accompanying consolidated balance sheets of Borden Chemical,
Inc. (a subsidiary of Borden Holdings, Inc.) and subsidiaries as of December 31,
2002  and  2001,  and  the  related  consolidated  statements  of  operations,
shareholders'  (deficit)  equity,  and cash flows for each of the three years in
the  period  ended  December  31,  2002.  These  financial  statements  are  the
responsibility of the Company's management.  Our responsibility is to express an
opinion  on  these  financial  statements  based  on  our  audits.

We conducted our audits in accordance with auditing standards generally accepted
in  the  United  States  of  America.  Those  standards require that we plan and
perform  the  audit  to  obtain reasonable assurance about whether the financial
statements are free of material misstatement.  An audit includes examining, on a
test  basis,  evidence  supporting  the amounts and disclosures in the financial
statements.  An audit also includes assessing the accounting principles used and
significant  estimates  made  by  management,  as well as evaluating the overall
financial  statement  presentation.  We  believe  that  our  audits  provide  a
reasonable  basis  for  our  opinion.

In  our  opinion,  such consolidated financial statements present fairly, in all
material  respects,  the  financial  position  of  Borden  Chemical,  Inc.  and
subsidiaries  at December 31, 2002 and 2001, and the results of their operations
and  their  cash  flows for each of the three years in the period ended December
31,  2002  in  conformity  with  accounting principles generally accepted in the
United  States  of  America.

As  discussed  in  Note  3 to the consolidated financial statements, the Company
changed  its  method  of  accounting for goodwill and other intangible assets in
2002  to  conform  to  Statement  of  Financial  Accounting  Standard  No.  142.




DELOITTE  &  TOUCHE  LLP

Columbus,  Ohio
March  12,  2003









































ITEM  9.        CHANGES  IN  AND  DISAGREEMENTS  WITH  ACCOUNTANTS
--------        --------------------------------------------------
                ON  ACCOUNTING  AND  FINANCIAL  DISCLOSURE
                ------------------------------------------

                None


                                    PART III

ITEM  10.     DIRECTORS  AND  EXECUTIVE  OFFICERS  OF  THE  REGISTRANT
---------     --------------------------------------------------------

Set  forth  below are the names and ages of the Directors and Executive Officers
of  the  Company  as  of  March  1, 2003, and the positions and offices with the
Company  currently  held  by  each of them.  Their terms of office extend to the
next  Annual  Meeting  of  the  Board of Directors or until their successors are
elected.

                                                                      Served  in
                                                     Age  on          Present
                                                     Dec.  31,        Position
    Name                  Position  &  Office          2002            Since
 ----------     -----------------------------         -----             -----

C.  R.  Kidder         Chairman of the Board            58              1995
B.  F.  Carroll        Director                         31              2001
K.  M.  Kelley         Director                         44              2001
H.  R.  Kravis         Director                         58              1995
P.  J.  Norris         Director                         55              2001
G.  R.  Roberts        Director                         59              1995
J.  K.  Saer           Director                         46              2001
S.  M.  Stuart         Director                         43              1995
C.  O.  Morrison       Director,                        47              2002
                       President  and  Chief  Executive  Officer
W.  H.  Carter         Director,                        49              1995
                       Executive  Vice  President  and Chief  Financial  Officer
W.  F.  Stoll,  Jr.    Director,                        54              1996
                       Executive  Vice  President  and General Counsel
J.  M.  Kaestle        Executive  Vice  President-      47              2001
                       Global  Resins
J.  P.  Bevilaqua      Executive  Vice President-       47              2002
                       Performance  Resins
E.  G.  Huller         Vice  President  -               55              2001
                       Global  Supply  Chain  Management
R.  H.  Glaser         Vice  President  -               42              2002
                       Strategy  and  Development
A.  J.  Miles          Vice  President-                 51              2001
                       Environmental  Health  &  Safety
J.  A.  Sonnett        Vice  President  -               46              2001
                       Human  Resources


C.  Robert  Kidder  was  elected  a  Director,  Chairman  of the Board and Chief
Executive  Officer  of  the  Company  on January 10, 1995.  In November, 2001 he
became  an  employee  and President of Borden Capital, Inc., a subsidiary of the
Company's  parent,  and  continued  to  serve  as  the Company's Chief Executive
Officer  through March 2002. He is also a director of WKI Holding Company, Inc.,
Electronic  Data  Systems Corporation and Morgan Stanley.  He is a member of the
Executive,  Nominating  and  Compensation  Committees  of  the  Board.

Brian F. Carroll was elected a Director of the Company November 20, 2001. He has
been an executive with Kohlberg, Kravis, Roberts & Co., since July 1999. From
September 1997 to June 1999 he attended the Stanford University Graduate School
of Business. Before attending graduate school, from March 1995 to July 1997, he
worked for Kohlberg Kravis Roberts & Co. He is also a director of AEP
Industries, Inc. He is Chairman of the Compensation Committee and a member of
the Audit Committee of the Board.

Kevin  M.  Kelley  served  as  Executive  Vice President, Corporate Strategy and
Development  of  the  Company  from  April  5,  1999 to November 24, 2001. Since
November 24, 2001 he has been employed as Executive Vice President and Treasurer
of Borden Capital, Inc., a subsidiary of the Company's parent.  He was elected a
director of the Company November 20, 2001. From April 1996 to March 1999, he was
Managing  Director  of  Ripplewood  Holdings  LLC.  He is also a director of AEP
Industries,  Inc.  He  is  a  member  of  the  Executive Committee of the Board.

Henry R. Kravis acted as Chairman of the Board of the Company from December 21,
1994, to January 10, 1995. He has been a member of KKR & Co., LLC since 1996,
was a General Partner of Kohlberg, Kravis, Roberts & Co. from its establishment
through 1995 and has been a General Partner of KKR Associates, L.P. since its
establishment. He is also a Director of Accuride Corporation, Alliance Imaging,
Inc., Amphenol Corporation, The Boyds Collection, Ltd., Evenflo Company Inc.,
KinderCare Learning Centers, Inc., KSL Recreation Corporation, PRIMEDIA Inc.,
Sotheby's Holdings, Inc., and Willis Group Holdings Limited. He is a member of
the Executive Committee of the Board. Messrs. Kravis and Roberts are first
cousins.

Paul  J. Norris was elected a director of the Company November 20, 2001.  He was
elected  President  and  Chief Executive Officer of W.R. Grace & Co. in November
1998 and became Chairman in January 1999.  Prior to joining W.R. Grace & Co., he
was  Senior Vice President of Allied Signal Incorporated and served as President
of  its  specialty  chemicals  business  from  January 1997 to November 1998. In
addition  to serving as a director of the Company, he performs advisory services
for  Kohlberg, Kravis,  Roberts  &  Co.  A significant portion of these advisory
services  relate  to the investment by affiliates of Kohlberg, Kravis, Roberts &
Co.  in  the  Company.  Mr.  Norris  is  a  member  of  the  Audit and Executive
Committees  of  the  Board.

George R. Roberts has been a member of KKR & Co., LLC since 1996, was a General
Partner of Kohlberg, Kravis, Roberts & Co. from its establishment through 1995,
and has been a General Partner of KKR Associates, L.P. since its establishment.
He is also a Director of The Boyds Collection, Ltd., DPL, Inc., KinderCare
Learning Centers, Inc., KSL Recreation Corporation, Owens-Illinois, Inc.,
PRIMEDIA Inc., Safeway, Inc., and Willis Group Holdings Limited. Messrs. Kravis
and Roberts are first cousins.

John K. Saer was elected a director of the Company November 20, 2001. He has
been a director with Kohlberg, Kravis, Roberts & Co. since January 2001. Prior
to that, from 1993 to December 2000 he was with KSL Recreation Corporation,
serving as Chief Financial Officer beginning in December 1996. He is a member of
the Executive, and Compensation Committees and is Chairman of the Audit and
Nominating Committees of the Board. He is also a Director of KSL Recreation
Corporation.

Scott M. Stuart has been a member of KKR & Co., LLC since 1996. He began his
employment with Kohlberg, Kravis, Roberts & Co. as an Executive in 1986. He is
also a Director of The Boyds Collection, Ltd., and DPL, Inc.(The Dayton Power &
Light Co.). He is a member of the Executive Committee of the Board.

Craig  O.  Morrison  was  elected  President  and Chief Executive Officer of the
Company  effective  March  25,  2002.  Prior to joining the Company he served as
President  and  General Manager of Alcan Packaging's Pharmaceutical and Cosmetic
Packaging  business  from  1999 to 2002.  From 1993 to 1998 he was President and
General  Manager  for  Van Leer Containers, Inc. He is a member of the Executive
and  Nominating  Committees  of  the  Board.

William  H.  Carter  was  elected  Executive  Vice President and Chief Financial
Officer  effective  April  3,  1995  and  a  director  November  20,  2001.

William  F.  Stoll,  Jr.  was  elected Senior Vice President and General Counsel
effective  July  1,  1996  and  promoted to Executive Vice President in December
2000.  He was elected a director of the Company November 20, 2001.  He is also a
director  of  AEP  Industries,  Inc.

John  M. Kaestle was elected an Executive Vice President of the Company November
24,  2001.  He  joined the Company's subsidiary, Borden Chemical, Inc., in March
2001  as Executive Vice President - Forest Products Group.  Prior to joining the
Company,  he  served  as  Vice President Containerboard Sales and Logistics, and
Chief  Financial  Officer,  Containerboard  Packaging  and Recycling Division of
Weyerhauser  Company,  from  1981  to  2001.

Joseph  P.  Bevilaqua  was elected a Vice President of the Company April 1, 2002
responsible for Corporate Strategy and Development.  In September 2002 he became
Vice  President  responsible for the Performance Resins Group.  Prior to joining
the  Company, he served as Vice President & General Manager of Alcan Packaging's
plastics  packaging business from February 2000 to March 2002.  From August 1998
to December 1999 he served as Vice President & General Manager of North American
Plastics  for  Russell-Stanley  Corporation.  Prior  to  that  he  held  various
positions  with  Woodbridge  Foam  Corporation,  from  1992-1997.

Edward  G. Huller was elected a Vice President of the Company November 24, 2001.
He  served  as  Vice President -Global Supply Chain Management for the Company's
subsidiary,  Borden  Chemical, Inc., beginning in May 1999.  Prior to that, from
1991-1999,  he  held  various positions at Dow Chemical, including Global Supply
Chain  Director  for  the  Chlor-Alkali  business.

Raymond H. Glaser was elected Vice President of Corporate Strategy & Development
in  August 2002.  Prior to joining the Company he served as Director of Business
Development  for  W.R.  Grace  & Co. from October 1999 to August 2002.  Prior to
that,  he  worked in several capacities from May 1996 to October 1999 for Allied
Signal's  Performance  Polymers division, including as Director of New Ventures.

Andrew  J.  Miles  was elected a Vice President of the Company November 24, 2001
responsible  for Health, Safety and Environmental compliance.  He served as Vice
President-  Health, Safety and Environmental (HS&E) for the Company's subsidiary
Borden  Chemical,  Inc., beginning in November 2000.  Prior to that he served as
Director  of  HS&E for Great Lakes Chemical, from May 1998 to November 2000, and
Vice  President of HS&E for Dexter Packaging Products from October 1992 to March
1998.

Judy  A.  Sonnett  was elected a Vice President of the Company November 24, 2001
responsible  for Human Resources.  She was Vice President of Human Resources for
the  Company's  subsidiary,  Borden  Chemical, Inc., beginning in November 1998.
From  1995  to  November  1998,  she worked in Human Resources for W.L. Gore and
Associates.


















































































ITEM  11.     EXECUTIVE  COMPENSATION
---------     -----------------------


During  2002,  Mr.  Kidder  served  as  the  Registrant's acting Chief Executive
Officer  until  March 25 when Mr. Morrison joined the Company.  Mr. Kidder's and
Mr.  Carter's  compensation  for  the  year  was paid by Borden Capital, Inc., a
subsidiary  of  the  Registrant's  parent.  The  Registrant  paid  a total of $9
million  to  Borden  Capital,  Inc. in 2002 for management services. The amounts
shown  in  the  following  table  as  compensation  to Mr. Kidder and Mr. Carter
represent  the portion of the Borden Capital fee related to services provided by
Mr.  Kidder  as  interim  CEO and Chairman, and by Mr. Carter as Chief Financial
Officer.  In  addition  to  Mr.  Kidder,  the  following  table provides certain
summary  information  concerning  compensation  of  the  Company's current Chief
Executive  Officer  and the next four most highly compensated Executive Officers
as  of  December  31,  2002  (the  "Named  Executive  Officers") for the periods
indicated.
<TABLE>
<CAPTION>
==================================================================================================================================
                                                          SUMMARY COMPENSATION TABLE
==================================================================================================================================
<S>                                  <C>      <C>      <C>         <C>                           <C>                         <C>
                                                  ANNUAL COMPENSATION                        LONG-TERM OMPENSATION
                                     =======================================          =================================
                                                                                                   AWARDS        PAYOUTS
                                                                                            ==================   =======
                                                                         OTHER ANNUAL    RESTRICTED  SECURITIES         ALL OTHER
                                                                         COMPENSATION    STOCK       UNDERLYING   LTIP  COMPENSA
NAME AND PRINCIPAL POSITION                  YEAR      SALARY    BONUS                   AWARDS      OPTIONS/SARS PAYOUTS  TION
                                                        ($)       ($)        ($)           ($)         (#)         ($)     ($)(2)
==================================================================================================================================
C.R. Kidder                                 2002   (4) 486,495   1,297,944  (1) 80,191       None        0       None   4,419,351
Chairman and former Chief Executive         2001 (6) 1,092,000     644,280      98,815       None        0       None      62,970
Officer                                     2000     1,194,063           0      87,757       None        (3)     None      99,503
----------------------------------------------------------------------------------------------------------------------------------
C.O. Morrison(5)                            2002       375,000     300,000           0 (7) 2,380,952  1,386,667  None      54,076
President and Chief Executive Officer
----------------------------------------------------------------------------------------------------------------------------------
W.H. Carter                                 2002   (4) 506,154 (8) 670,363           0       None       None     None     825,449
Executive Vice President and                2001       486,250     215,890           0       None       None     None      34,907
Chief Financial Officer                     2000       462,538     200,000           0       None       None     None      31,878
----------------------------------------------------------------------------------------------------------------------------------
W.F. Stoll, Jr                              2002       417,599 (8) 414,913           0       None       None     None     449,205
Executive Vice President and General        2001       409,000     180,068           0       None       None     None      19,571
Counsel                                     2000       387,425      90,000           0       None       None     None      22,260
----------------------------------------------------------------------------------------------------------------------------------
J.M. Kaestle                                2002       260,096     108,150           0       None       None     None       5,048
Executive Vice President, Forest Products   2001       188,461     158,157           0       None       None     None       3,365
Group
----------------------------------------------------------------------------------------------------------------------------------
E.G. Huller                                 2002       268,707      80,580           0       None       None     None      15,129
Vice President, Supply Chain Management     2001       261,626      93,502           0       None       None     None      14,339
==================================================================================================================================
<FN>

(1)     Includes $60,000 pursuant to the Executive Perquisite Benefit Plan and $20,191 not paid
to  Mr.  Kidder  but  allocable  to  his  personal  use  of  company  aircraft.
(2)     Except  as  stated  herein,  amounts  shown  in this column for 2002 consist of matching
company  contributions  to  the  Retirement  Savings Plan and the executive supplemental benefit
plans.  The  amount  shown for Mr. Kidder also includes a stay bonus of $1,718,880 and severance
of  $2,605,537  both of which were accrued but not paid in 2002.  The amount for Mr. Carter also
includes  a  stay  bonus of $785,137 which was accrued but not paid in 2002.  The amount for Mr.
Stoll  also includes a stay bonus of $419,480 which was accrued but not paid in 2002. The amount
shown  for  Mr. Kaestle is solely related to unused vacation.  The amount shown for Mr. Morrison
includes  $38,521  for  reimbursed  moving  expenses.
(3)     Unit  appreciation rights in BW Holdings, LLC held by Mr. Kidder are not exercisable for
units  or  stock.
(4)     Represents amount of payment from the Registrant to Borden Capital for services provided
by  Mr.  Kidder as interim CEO and Chairman.  Mr. Kidder received aggregate salary from   Borden
Capital of $1,247,424 in 2002.  100% of Mr. Carter's salary was paid by Borden Capital funded by
fees  paid  by  the  Company.
(5)     Mr. Morrison was elected President and Chief Executive Officer effective March 25, 2002.
(6)     Represents  salary  through  November 15, at which time Mr. Kidder became an employee of
Borden  Capital,  Inc.  His  aggregate  salary  for  2001  was  $1,248,000.
(7)     Mr.  Morrison's  restricted  stock  consists of 1,058,201 shares.  There is no published
market  value of the Registrant's shares at Dec. 31. Dividends are not payable on the restricted
shares.  See  description  in  "Employment,  Termination and Change in Control Arrangements" for
other  terms  of  Mr.  Morrison's restricted stock, which vests after three years of employment,
unless  he  is  terminated  without  cause,  in  which  event  vesting  is  accelerated.
(8)     A  portion  of the bonus payments made to Messrs. Carter ($417,263) and Stoll ($225,000)
were  paid  by  Borden  Capital,  Inc.,  funded  by  fees  paid  by the Company, as described in
"Employment,  Termination and Change in Control Arrangements".  $30,500 of the bonus paid to Mr.
Stoll  was  paid  by  Borden  Capital,  Inc.  for  services  provided  to  affiliates.
</TABLE>

                                               OPTION GRANTS IN LAST FISCAL YEAR
                                               ---------------------------------
<TABLE>
<CAPTION>
The following table provides information on option grants during 2002 to the Named Executive Officers.
==================================================================================================================================
                                                       INDIVIDUAL GRANTS
==================================================================================================================================
<S>                       <C>                      <C>                      <C>                  <C>                       <C>
                     # OF SECURITIES      % OF TOTAL OPTIONS/SAR'S
                       UNDERLYING           GRANTED TO EMPLOYEES                                                    GRANT DATE (1)
                      OPTIONS/SAR'S            FISCAL YEAR            EXERCISE OR BASE PRICE     EXPIRATION       PRESENT VALUE $
NAME                     GRANTED                                            ($/SHARE)               DATE
                           (#)
==================================================================================================================================
C. R. KIDDER                0                        N/A                      N/A                   N/A                N/A
----------------------------------------------------------------------------------------------------------------------------------
C.O. MORRISON       1,386,667                        93%                     $2.25                3/31/12             $679,467
----------------------------------------------------------------------------------------------------------------------------------
W. H. CARTER                0                        N/A                      N/A                   N/A                N/A
----------------------------------------------------------------------------------------------------------------------------------
W. F. STOLL                 0                        N/A                      N/A                   N/A                N/A
----------------------------------------------------------------------------------------------------------------------------------
J.M KAESTLE                 0                        N/A                      N/A                   N/A                N/A
----------------------------------------------------------------------------------------------------------------------------------
E.G.HULLER                  0                        N/A                      N/A                   N/A                N/A
==================================================================================================================================
<FN>
(1)  The  fair  value  of  each option grant is estimated on the date of grant using the Black-Scholes
option  pricing  model  with  risk  free  interest  rates  of  5.00%, dividend rates of 0.0%, expected
volatility  of  0.01%  and  expected  life  of  five  years.

==================================================================================================================================

                              OPTION EXERCISE IN LAST FISCAL YEAR AND FY-END OPTION VALUES
                              ------------------------------------------------------------

The following table provides information on option exercises during 2002 by the Named Executive Officers and the value of their
unexercised options at December 31, 2002.
==================================================================================================================================
                                      # OF SECURITIES UNDERLYING                                  VALUE OF UNEXERCISED IN-THE-
                                      UNEXERCISED OPTIONS/SARS AT                                 MONEY OPTIONS/SARS AT FISCAL
                                            FISCAL YEAR END                                                YEAR END ($)
==================================================================================================================================
NAME                           EXERCISABLE                  UNEXERCISABLE                      EXERCISABLE         UNEXERCISABLE
==================================================================================================================================
C.R. KIDDER                         0                      12,225,730(1)                           0                        0
----------------------------------------------------------------------------------------------------------------------------------
C.O. MORRISON                       0                       1,386,667                              0                $27,733.34
----------------------------------------------------------------------------------------------------------------------------------
W.H. CARTER                         0                               0                              0                         0
----------------------------------------------------------------------------------------------------------------------------------
W.F. STOLL                          0                               0                              0                         0
----------------------------------------------------------------------------------------------------------------------------------
J.M. KAESTLE                        0                               0                              0                         0
----------------------------------------------------------------------------------------------------------------------------------
E.G.HULLER                          0                               0                              0                         0
==================================================================================================================================

 (1)  Represents  unit  appreciation  rights  in  BW  Holdings,  LLC,  which  are  not  exercisable  for  units  or  stock.
</TABLE>




























RETIREMENT  BENEFITS,  COMPENSATION  OF  DIRECTORS,  EMPLOYMENT, TERMINATION AND
--------------------------------------------------------------------------------
CHANGE  IN  CONTROL  ARRANGEMENTS, COMPENSATION COMMITTEE INTERLOCKS AND INSIDER
--------------------------------------------------------------------------------
PARTICIPATION
-------------

The  Long-Term  Incentive Plans-Awards In Last Fiscal Year table is not included
since  the  Registrant  has  no  long-term  incentive  plan.

Retirement  Benefits
--------------------
The  Borden Employees Retirement Income Plan ("ERIP") for salaried employees was
amended  as  of  January  1,  1987, to provide benefit credits of 3% of earnings
which  are  less  than  the  Social  Security  wage base for the year plus 6% of
earnings  in  excess  of the wage base. Earnings include annual incentive awards
paid currently but exclude any long-term incentive awards.  Benefits for service
through December 31, 1986, are based on the plan formula then in effect and have
been  converted  to  opening balances under the plan.  Both opening balances and
benefit  credits  receive interest credits at one-year Treasury bill rates until
the  participant  commences  receiving  benefit payments. For the year 2002, the
interest  rate  as  determined  in  accordance with the plan language was 2.18%.
Benefits  vest  after completion of five years of employment for employees hired
on  or  after  July  1,  1990.

The  Company  has supplemental plans which will provide those benefits which are
otherwise  produced by application of the ERIP formula, but which, under Section
415 or Section 401 (a)(17) of the Internal Revenue Code, are not permitted to be
paid through a qualified plan and its related trust.  The supplemental plan also
provides  a  pension  benefit using the ERIP formula based on deferred incentive
compensation  awards  and  certain  other  deferred  compensation, which are not
considered  as  part  of  compensation  under  the  ERIP.

The  total  projected  annual benefits payable under the formulas of the ERIP at
age  65  without  regard to the Section 415 or 401(a)(17) limits and recognizing
supplemental pensions as described above, are as follows for the Named Executive
Officers  of  the  Company  in  2002:  C.  R. Kidder - $175,893, C.O. Morrison -
$78,112,  W.  H.  Carter  -  $125,223,  W.F.  Stoll - $60,820 (not including the
special  employment  contract  benefit described below), J.M. Kaestle - $42,368,
and  Huller-  $24,347.

The  Company has a special retirement arrangement with Mr. Stoll, Executive Vice
President  and  General  Counsel.  Under  this  arrangement,  the  Company  will
calculate  the  benefit  Mr. Stoll would have received from his former employer,
using  predetermined  assumptions,  and  deduct  from this amount the retirement
benefits accrued under the Borden Retirement Programs. Any shortfall in benefits
will  be paid by the Company as a non-qualified benefit. Special provisions also
apply  in  the  event  of  death  or  disability.

In  addition,  certain Executive Officers receive Company matching contributions
on  the  first  7%  of  contributions  to  the Retirement Savings Plan.  Company
matching  contributions  on  employee contributions in excess of 5% are provided
under the supplemental plans.  This benefit is not provided if the executive has
any  other  pension  benefit  guarantee.

Compensation  of  Directors
---------------------------
In  2002,  Messrs. Kravis, Roberts, Stuart, Saer and Carroll received Board fees
ranging  in  the  aggregate from $10,000 to $30,000.  No additional compensation
was  paid  for  committee participation or special assignments. Fees for Messrs.
Kelley's  and  Kidder's  services as Directors were paid as part of a management
fee  paid  by  the  Company  to Borden Capital, Inc. as described under "Certain
Relationships  and  Related  Transactions". Directors who were also employees of
the  Company  received  no  remuneration  for  serving  as  directors.

Directors  who  served prior to March 15, 1995 and who were not employees of the
Company  are  provided,  upon attaining age 70, annual benefits through a funded
grantor  trust  equal  to their final annual retainer if they served in at least
three  plan  years.  Such  benefits  can  continue  for  up  to  15  years.

Employment,  Termination  and  Change  in  Control  Arrangements
----------------------------------------------------------------
The  Company has an arrangement with Mr. Morrison that provides for his services
as  President and Chief Executive Officer beginning March 2002.  Under the terms
of  the  agreement Mr. Morrison was provided with relocation assistance, a bonus
opportunity,  an  equity  investment  opportunity,  and a 2001 incentive payment
guarantee.  Pursuant  to  this arrangement Mr. Morrison purchased 222,222 shares
of  the  Company's  common stock at $2.25 per share and received 210,667 options
granted  at  $2.25  per share.  Mr. Morrison also received 1,176,000 performance
options  at  $2.25  per share which vest at the earlier of five years, or in 33%
increments  when  the Company meets EBITDA targets of $170 million, $190 million
and  $210  million.  In  addition  Mr.  Morrison was granted 1,058,201 shares of
restricted  stock  which  vest  after  three  years of employment, at which time
one-half  of the shares may be sold to the Company.  The remaining shares may be
sold  to the Company after four years of employment.  The value of the shares is
to  be  determined  based  upon  a  formula,  and  is  capped,  under  certain
circumstances,  at  $2  million.  In  the  event  Mr.  Morrison's  employment is
terminated  without  cause, the vesting of the restricted shares is accelerated.
Dividends are not payable on the restricted shares. In the event that the return
on  Mr.  Morrison's  equity investment in the Company is negative, due solely to
certain  specified  circumstances,  the  arrangement  requires  the  Company  to
purchase  his  investment  at  a  price  equal  to  his initial investment.  The
arrangement  also  entitles  Mr. Morrison to receive a perquisite payment in the
amount of $40,000 annually, usual and customary health and pension benefits, and
provides for eighteen months severance based on monthly base salary in the event
of  termination  of  employment  for  reasons  other  than  for  cause.

In  March  2003,  an  agreement  was  reached  with  Mr.  Kidder relating to his
termination  of employment with Borden Capital, Inc. Mr. Kidder will continue as
Chairman  of  the  Board  of  the Company.  The agreement provides for two years
severance  pay totaling $2,565,888 and a stay bonus of $1,718,880, both of which
will  be paid in a lump sum on April 11, 2003.  Under the terms of the agreement
Mr.  Kidder  is  provided with a country club golf membership, office space,
outplacement  services,  pay for unused vacation, and continued COBRA healthcare
coverage through March 2005 at rates charged to active employees.  The agreement
also  provides  that  Mr. Kidder's investment in BW Holdings, LLC will be valued
upon  the  wind-up  of  that  entity.

The  Company  has  an  arrangement  with Mr. Stoll relating to his employment as
Executive  Vice President and General Counsel.  Under the terms of the agreement
Mr.  Stoll  is entitled to a stay bonus equal to $644,000 payable from 2002-2005
or  upon  termination  for  reasons  other  than  for cause.  The agreement also
provides  for annual incentive plan participation, an annual perquisites payment
of  $30,000,  five  weeks  vacation,  and  twenty-four  months  of  base  salary
severance.  In  addition Mr. Stoll has a special pension arrangement pursuant to
which  the  Company  will  calculate  the  pension  benefit Mr. Stoll would have
received  from  his former employer, using predetermined assumptions, and deduct
from  this amount the retirement benefits accrued under the Company's retirement
programs.  Any  shortfall  in  benefits  will  be  paid  by  the  Company  as  a
non-qualified  benefit.  Special  provisions also apply in the event of death or
disability.

The  Company  has  an  agreement  with  Mr. Carter relating to his employment as
Executive  Vice  President  and Chief Financial Officer.  Under the terms of the
agreement  Mr.  Carter  is  entitled to a stay bonus equal to $1,200,000 payable
from  2002-2005  or  upon  termination  for  reasons  other than for cause.  The
agreement  also  provides  for  annual incentive plan and management equity plan
participation,  an annual perquisites payment of $30,000, and twenty-four months
of  base  salary  severance.

The  Company  entered  into  an  agreement  effective  Nov. 24, 2001 with Borden
Capital,  Inc., a subsidiary of the Company's parent, which is described in Item
13.  Certain  Relationships and Related Transactions.   Certain fees paid by the
Company under this agreement fund compensation arrangements described above with
Messrs. Kidder, Carter and Stoll which entitle them to stay-bonus payments which
total  $1,718,880,  $1,200,000  and $ 644,000 respectively over a four year time
period  from  2002-2005  or  upon  termination  of employment without cause.  In
addition,  in  2002, the Company's fee funded payments from Borden Capital, Inc.
for  the salaries of Messrs. Kidder and Carter and incentive payments to Messrs.
Kidder  and  Stoll.

Compensation  Committee  Interlocks  and  Insider  Participation
----------------------------------------------------------------
Messrs. Carroll and Saer are members of the Company's Compensation Committee and
both  are employees of Kohlberg Kravis Roberts & Co.  See "Certain Relationships
and  Related  Transactions."  Mr.  Kidder, the former Chief Executive Officer of
the  Company,  is  also  a  member  of  the  Compensation  Committee.




























ITEM  12.    SECURITY  OWNERSHIP  OF  CERTAIN  BENEFICIAL  OWNERS  AND
---------    ---------------------------------------------------------
MANAGEMENT
----------

The  following  table  sets  forth  certain information regarding the beneficial
ownership of the Registrant's Common Stock and other equity securities issued by
affiliated entities, as of March 1, 2003, by (a) persons known to the Registrant
to  be the beneficial owners of more than five percent of the outstanding voting
stock  of the Registrant,  (b) each director of the Registrant,  (c) each of the
Named  Executive  Officers  of the Registrant during the 2002 fiscal year of the
Registrant  and  (d) all directors and executive officers of the Registrant as a
group. Except as otherwise noted, the persons named in the table below have sole
voting and investment power with respect to all securities shown as beneficially
owned  by  them.

            Name  of                                  Beneficial  Ownership
         Beneficial  Owner                            of  Equity  Securities
       -------------------                       ------------------------------
                                                     Shares/Units     Percent
                                                      ------------     -------

KKR  Associates  (1)                                  198,974,994       99.0
  9  West  57th  Street
  New  York,  New  York  10019
C.  Robert  Kidder                                        369,569  (2)    *
Henry  R.  Kravis  (1)                                      -0-           *
George  R.  Roberts  (1)                                    -0-           *
Scott  M.  Stuart  (1)                                      -0-           *
Brian  F.  Carroll                                          -0-           *
John  K.  Saer                                              -0-           *
Paul  J.  Norris                                            -0-           *
Kevin  M.  Kelley                                           -0-           *
Craig  O.  Morrison                                     1,322,556  (3)    *
William  H.  Carter                                         -0-           *
William  F.  Stoll,  Jr.                                    -0-           *
John  M.  Kaestle                                           -0-           *
Edward  G.  Huller                                          -0-           *
All  Directors  and  Executive  Officers                       (4)        *
   as  a  group

 *     Beneficial  ownership  does  not  exceed  1.0% of the respective class of
securities.
(1) The Registrant's Common Stock shown as beneficially owned by KKR Associates
is directly held by Borden Holdings, Inc., a Delaware corporation which is
wholly owned by BW Holdings, LLC, a Delaware limited liability company, the
managing member of which is a limited partnership, of which KKR Associates is
the sole general partner and as to which it possesses sole voting and investment
power. KKR Associates is also the beneficial owner of 632,000,000 units of BW
Holdings, LLC. KKR Associates is a limited partnership of which Messrs. Todd
Fisher, Edward A. Gilhuly, Perry Golkin, James H. Greene, Jr., Johannes Huth,
Henry R. Kravis, Robert I. MacDonnell, Michael W. Michelson, Alexander Navab,
Paul E. Raether, Neil Richardson, George R. Roberts, and Scott M. Stuart are the
general partners. Such persons may be deemed to share beneficial ownership of
the shares shown as owned by KKR Associates. The foregoing persons disclaim
beneficial ownership of any such shares.
(2) Represents units in BW Holdings, LLC.
(3) As of March 1, Mr. Morrison beneficially owned 1,280,423 shares of
common stock of the Registrant, and 42,133 shares subject to currently
exercisable stock options.
(4) Equity securities beneficially owned by all
directors and executive officers as a group consist of: 369,569 units of BW
Holdings, LLC, 1,920,634 shares of the Registrant, and 63,199 shares of the
Registrant subject to currently exercisable options.























ITEM  13.   CERTAIN  RELATIONSHIPS  AND  RELATED  TRANSACTIONS
---------   --------------------------------------------------

All  of  the Company's common stock is owned by a holding company which is owned
by  an  affiliate  of  KKR  Associates,  a New York limited partnership of which
Messrs.  Todd  Fisher,  Edward  A.  Gilhuly, Perry Golkin, James H. Greene, Jr.,
Johannes  Huth,  Henry  R.  Kravis,  Robert I. MacDonnell, Michael W. Michelson,
Alexander  Navab, Paul E. Raether, Neil Richardson, George R. Roberts, and Scott
M.  Stuart  are  the  general  partners.  KKR  Associates  has  sole  voting and
investment power with respect to such shares. Messrs. Kravis, Roberts and Stuart
are  directors  of  the  Company.

The  Company  entered  into  an  agreement  effective  Nov. 24, 2001 with Borden
Capital,  Inc.  ("Capital")  a  subsidiary  of  the  Company's  parent,  for the
provision of management, consulting and board services by Capital to the Company
and for the provision of administrative services by the Company to Capital.  The
cost  of  these  services  in  2002  was  a  net expense to the Company of $14.5
million.   Included  in  this  fee  are  fees  for Mr. Kelley's and Mr. Kidder's
services as directors of the Company, and certain compensation arrangements with
Messrs.  Kidder,  Carter  and  Stoll  which  entitle them to payments totaling $
1,718,880,  $1,200,000  and  $644,000  respectively over a four year period from
2002-2005,  or  upon  termination  of  employment  without cause. In addition, a
portion  of  Mr.  Kidder's salary and all of  Mr. Carter's salary is included in
the  above mentioned fee.  Mr. Kidder, Chairman of the Company, is an officer of
Capital.

In  2000,  the  Company  made a loan to Mr. Carter, Executive Vice President and
Chief  Financial  Officer,  in  the  amount  of  $375,000, of which $225,000 was
secured  with  a  mortgage on his residence. The interest rate applicable to the
loan  was  prime less .25%. The full amount of the loan plus accrued interest as
of  May  31,  2002,  totaling  $417,263,  has  been  repaid  by  Mr.  Carter.



ITEM  14.  CONTROLS  AND  PROCEDURES
------------------------------------

ANNUAL  EVALUATION  OF  OUR  DISCLOSURE  CONTROLS  AND  INTERNAL  CONTROLS
Within  the  90  days  prior  to  the  date  of this Annual Report on Form 10-K,
management  evaluated  the  effectiveness  of  the  design  and operation of the
Company's  disclosure  controls  and  procedures  and  the internal controls and
procedures  for financial reporting. This controls evaluation was done under the
supervision  and with the participation of the Chief Executive Officer (CEO) and
Chief  Financial Officer (CFO). Following are the conclusions of the CEO and the
CFO  about the effectiveness of our disclosure controls and internal controls as
of  March  13,  2003.

CEO  AND  CFO  CERTIFICATIONS
Appearing  immediately following the Signatures section of this Annual Report on
Form  10-K  there  are certifications of the CEO and the CFO. The certifications
are  required  in accordance with Section 302 of the Sarbanes-Oxley Act of 2002.
This  section  of  the  Annual Report is the information concerning the controls
evaluation  referred  to  in the Section 302 certifications and this information
should  be  read  in  conjunction with the Section 302 certifications for a more
complete  understanding  of  the  topics  presented.

DISCLOSURE  CONTROLS  AND  INTERNAL  CONTROLS
Disclosure  controls  are  procedures  that  are  designed with the objective of
ensuring  that  information  required to be disclosed in reports filed under the
Securities  Exchange  Act  of  1934,  or  the  Exchange Act, such as this Annual
Report,  is recorded, processed, summarized and reported within the time periods
specified  in  the  SEC's rules and forms. Disclosure controls are also designed
with  the  objective  of  ensuring  that  such  information  is  accumulated and
communicated  to  management, including the CEO and CFO, as appropriate to allow
timely decisions regarding required disclosure. Internal controls are procedures
which are designed with the objective of providing reasonable assurance that the
Company's  transactions  are  properly  authorized,  its  assets are safeguarded
against  unauthorized or improper use and transactions are properly recorded and
reported, all to permit the preparation of the Company's financial statements in
conformity  with  generally  accepted  accounting  principles.

LIMITATIONS  ON  THE  EFFECTIVENESS  OF  CONTROLS
The  Company's  management,  including the CEO and the CFO, does not expect that
the  disclosure  controls  or  internal  controls will prevent all error and all
fraud.  A control system, no matter how well conceived and operated, can provide
only  reasonable,  not  absolute,  assurance  that the objectives of the control
system  are  met.  Additionally,  controls  can  be  circumvented by the acts of
individuals  or  by  collusion  of  two or more people.  Because of the inherent
limitations  in  all  control systems, including the realities that judgments in
decision-making  can  be faulty, and that breakdowns can occur because of simple
error  or mistake, no evaluation of controls can provide absolute assurance that
all  control issues and instances of fraud, if any, within the Company have been
detected.

SCOPE  OF  THE  CONTROLS  EVALUATION
The  evaluation  of our disclosure controls and our internal controls by our CEO
and  our  CFO  included  a review of all previously existing controls as well as
those  recently implemented by the Company and the effect of the controls on the
information  generated for use in this Annual Report on Form 10-K. In the course
of  the controls evaluation, management sought to identify data errors, controls
problems  or  acts  of  fraud and to confirm that appropriate corrective action,
including process improvements, were being undertaken. The internal controls are
also  evaluated  on  an ongoing basis by the internal audit department, by other
personnel in the finance department and by the Company's independent auditors in
connection  with  their  audit and review activities. The overall goals of these
various  evaluation  activities are to monitor the Company's disclosure controls
and  internal  controls  and to make modifications as necessary, with the intent
being  that the disclosure controls and the internal controls will be maintained
as  dynamic systems that change (including with improvements and corrections) as
conditions  warrant. Among other matters, management sought in its evaluation to
determine  whether  there  were  any  "significant  deficiencies"  or  "material
weaknesses"  in  the  Company's  internal controls, or whether any acts of fraud
involving  personnel  who  have a significant role in the internal controls were
identified.  This  information  was  important  both for the controls evaluation
generally and because Items 5 and 6 in the Section 302 certifications of the CEO
and  the  CFO  require that the CEO and the CFO disclose such information to the
Board's Audit Committee and to the independent auditors and to report on related
matters  in  this section of the Annual Report on Form 10-K. In the professional
auditing  literature,  "significant deficiencies" are referred to as "reportable
conditions."  These  are  control  issues  that could have a significant adverse
effect on the ability to record, process, summarize and report financial data in
the  financial  statements.  A  "material  weakness"  is defined in the auditing
literature  as  a  particularly  serious reportable condition where the internal
control  does  not  reduce to a relatively low level the risk that misstatements
caused by error or fraud may occur in amounts that would be material in relation
to  the  financial  statements  and  not  be  detected within a timely period by
employees  in  the  normal  course  of  performing  their  assigned  functions.
Management  also  sought  to  deal  with  other controls matters in the controls
evaluation  and,  in  each  case  if  a problem was identified, to consider what
revision,  improvement  and/or  correction  to  make  in accordance with ongoing
procedures.

CONCLUSIONS
Based upon the controls evaluation, the CEO and CFO have concluded that, subject
to  the limitations noted above, the Company's disclosure controls are effective
to  ensure  that  material  information relating to the Company is made known to
management,  including  the CEO and the CFO, particularly during the period when
the  Company's  periodic  reports  are  being  prepared,  and that the Company's
internal  controls  are  effective  to  provide  reasonable  assurance  that the
Company's financial statements are fairly presented in conformity with generally
accepted  accounting  principles.  Further,  since  the  date  of  the  controls
evaluation  to  the  date  of this Annual Report, there have been no significant
changes in internal controls or in other factors that could significantly affect
internal  controls,  including any corrective actions with regard to significant
deficiencies  and  material  weaknesses.






































               CHIEF EXECUTIVE OFFICER'S SECTION 302 CERTIFICATION

I,  Craig O. Morrison, Chief Executive Officer of Borden Chemical, Inc., certify
that:

1.     I have reviewed this Annual Report on Form 10-K of Borden Chemical, Inc.;

2.     Based  on  my  knowledge,  this annual report does not contain any untrue
statement  of  material  fact or omit to state a material fact necessary to make
the  statements  made, in light of the circumstances under which such statements
were  made,  not  misleading  with  respect to the period covered by this annual
report;

3.     Based  on  my  knowledge,  the  financial statements, and other financial
information  included  in  this  annual  report,  fairly present in all material
respects  the  financial  condition, results of operations and cash flows of the
registrant  as  of,  and  for,  the  periods  presented  in  this annual report;

4.     The  registrant's  other  certifying  officer  and  I are responsible for
establishing  and  maintaining disclosure controls and procedures (as defined in
Exchange  Act  Rules  13a-14  and  15d-14)  for  the  registrants  and  we have:

a.     Designed  such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated subsidiaries,
is  made  known  to  us by others within those entities, particularly during the
period  in  which  this  annual  report  is  being  prepared
b.     Evaluated  the  effectiveness of the registrant's disclosure controls and
procedures  as  of a date within 90 days prior to the filing date of this annual
report  (the  "Evaluation  Date");  and
c.     Presented  in  this  annual  report  our  conclusions  based  upon  the
effectiveness  of the disclosure controls and procedures based on our evaluation
as  of  the  Evaluation  Date;

5.     The  registrant's other certifying officer and I have disclosed, based on
our most recent evaluation, to the registrant's auditors and the audit committee
of  registrant's  board  of  directors  (or  persons  performing  the equivalent
functions):

a.     All  significant  deficiencies  in  the  design  or operation of internal
controls  which  could  adversely  affect  the  registrant's  ability to record,
process,  summarize  and  report  financial  data  and  have  identified for the
registrant's  auditors  any  material  weaknesses  in  internal  controls  and
b.     Any  fraud,  whether  or  not material, that involved management or other
employees who have a significant role in the registrant's internal controls; and

6.     The  registrant's  other  certifying officer and I have indicated in this
annual  report whether there were significant changes in internal controls or in
other  factors  that  could significantly affect internal controls subsequent to
the  date  of  our most recent evaluation, including any corrective actions with
regard  to  significant  deficiencies  and  material  weaknesses.



Date:  March  27,  2003

                              /s/ Craig O. Morrison
                              -------------------------
                              Craig  O.  Morrison
                              Chief  Executive  Officer






























               CHIEF FINANCIAL OFFICER'S SECTION 302 CERTIFICATION


I,  William H. Carter, Chief Financial Officer of Borden Chemical, Inc., certify
that:

1.     I have reviewed this Annual Report on Form 10-K of Borden Chemical, Inc.;

2.     Based  on  my  knowledge,  this annual report does not contain any untrue
statement  of  material  fact or omit to state a material fact necessary to make
the  statements  made, in light of the circumstances under which such statements
were  made,  not  misleading  with  respect to the period covered by this annual
report;

3.     Based  on  my  knowledge,  the  financial statements, and other financial
information  included  in  this  annual  report,  fairly present in all material
respects  the  financial  condition, results of operations and cash flows of the
registrant  as  of,  and  for,  the  periods  presented  in  this annual report;

4.     The  registrant's  other  certifying  officer  and  I are responsible for
establishing  and  maintaining disclosure controls and procedures (as defined in
Exchange  Act  Rules  13a-14  and  15d-14)  for  the  registrants  and  we have:

a.     Designed  such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated subsidiaries,
is  made  known  to  us by others within those entities, particularly during the
period  in  which  this  annual  report  is  being  prepared
b.     Evaluated  the  effectiveness of the registrant's disclosure controls and
procedures  as  of a date within 90 days prior to the filing date of this annual
report  (the  "Evaluation  Date");  and
c.     Presented  in  this  annual  report  our  conclusions  based  upon  the
effectiveness  of the disclosure controls and procedures based on our evaluation
as  of  the  Evaluation  Date;

5.     The  registrant's other certifying officer and I have disclosed, based on
our most recent evaluation, to the registrant's auditors and the audit committee
of  registrant's  board  of  directors  (or  persons  performing  the equivalent
functions):

a.     All  significant  deficiencies  in  the  design  or operation of internal
controls  which  could  adversely  affect  the  registrant's  ability to record,
process,  summarize  and  report  financial  data  and  have  identified for the
registrant's  auditors  any  material  weaknesses  in  internal  controls  and
b.     Any  fraud,  whether  or  not material, that involved management or other
employees who have a significant role in the registrant's internal controls; and

6.     The  registrant's  other  certifying officer and I have indicated in this
annual  report whether there were significant changes in internal controls or in
other  factors  that  could significantly affect internal controls subsequent to
the  date  of  our most recent evaluation, including any corrective actions with
regard  to  significant  deficiencies  and  material  weaknesses.



Date:  March  27,  2003

                               /s/ William H. Carter
                              --------------------------
                              William  H.  Carter
                              Chief  Financial  Officer






























                                     PART IV

ITEM  15.     EXHIBITS,  FINANCIAL  STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
---------     ------------------------------------------------------------------

(a)     List  of  documents  filed  as  part  of  this  report
        ------------------------------------------------------

 1.     Financial  Statements
            ---------------------

All  financial  statements  of the registrant are set forth under Item 8 of this
Report  on  Form  10-K.

2.     Financial  Statement  Schedules
       -------------------------------

Report  of  Independent  Auditors  (page  85)

For  the  three  years  ended  December  31,  2002:
     Schedule  II  -  Valuation  and  Qualifying  Accounts  (page  86)

3.    Exhibits





























































15  (A)  EXHIBITS,  FINANCIAL  STATEMENT  SCHEDULES,  AND  REPORTS  ON  FORM 8-K
--------------------------------------------------------------------------------

Management  contracts,  compensatory plans and arrangements are listed herein at
Exhibits  (10)(  iv  )  through  (10)(xvii).


     (3)(i)          Restated Certificate of Incorporation dated March 14, 1995,
and Certificate of Amendment of Restated Certificate of Incorporation dated June
23, 1995, both incorporated herein by reference from Exhibit (3) to the June 30,
1995  Form  10-Q.

       (ii)          By-Laws  dated  November  4,  2002.

     (4)(i)          Form  of  Indenture  dated  as  of  January  15,  1983,  as
supplemented by the First Supplemental Indenture dated as of March 31, 1986, and
the  Second  Supplemental  Indenture, dated as of June 26, 1996, relating to the
$200,000,000  8-3/8%  Sinking  Fund  Debentures due 2016, incorporated herein by
reference  from  Exhibits  (4)(a)  and  (b)  to  Amendment No. 1 to Registration
Statement  on  Form  S-3,  File  No. 33-4381 and Exhibit (4)(iv) to the June 30,
1996,  Form  10-Q.

       (ii)          Form  of  Indenture  dated  as  of December 15, 1987, as
supplemented  by the First Supplemental Indenture dated as of December 15, 1987,
and  the  Second  Supplemental  Indenture  dated as of February 1, 1993, and the
Third  Supplemental  Indenture dated as of June 26, 1996, incorporated herein by
reference  from  Exhibits  (4)(a) through (d) to  Registration Statement on Form
S-3,  File  No.  33-45770, and Exhibit (4)(iii) to the June 30, 1996, Form 10-Q,
relating  to  the  following  Debentures  and  Notes:

                    (a)     The  $150,000,000 9-1/4% Sinking Fund Debentures due
                            2019.

                    (b)     The  $200,000,000  9-1/5%  Debentures  due  2021.

                    (c)     The  $250,000,000  7-7/8%  Debentures  due  2023.

     (iii)          Form  of  Indenture  relating  to  Senior  Securities,
incorporated  herein by reference from Exhibit 4.1 to the Company's Registration
Statement  on  Form  S-3,  File  No.  33-57577.

      (iv)          Form  of  Indenture  relating to Subordinated Securities
incorporated  herein by reference from Exhibit 4.2 to the Company's Registration
Statement  on  Form  S-3,  File  No.  33-57577.


    (10)(i)        Loan  and  Security  Agreement dated September 23, 2002 among
Borden Chemical,  Inc.,  Borden  Chemical  Canada,  Inc.,  Borden  Chemical  UK
Limited,  Borden  Chemical  GB  Limited,  and  Fleet  Capital  Corporation,
as  Lender  and  Agent  for  the  other  lenders  thereto,  incorporated  herein
by  reference  to  Exhibit  (10)(i)  to  the  September  30,  2002  Form  10-Q.

    (ii)          Credit  Agreement  dated as of December 15, 1994 amended
and  restated  as  of July 14, 1997, incorporated herein by reference to Exhibit
(10)(ii)  to  the  June  30,  1997  Form  10-Q.

   (iii)          Stockholders  Agreement,  dated as of June 20, 1996, by
and  among  Borden,  Inc. and J. Brendan Barba, Paul M. Feeny, David MacFarland,
Robert  Cron,  Kenneth  J.  Avia,  Melanie K. Barba, John Powers, Lauren Powers,
Carolyn Vegliante and Lawrence Noll, incorporated herein by reference to Exhibit
2  to  Schedule  13D,  dated  July  1,  1996.  File  No.  005-37385.

    (iv)          Amended  and  Restated  1996 Unit Incentive Plan for Key
Employees  of  Borden,  Inc.  and  Associated  Persons,  as  of  June  29, 1999,
incorporated herein by reference to Exhibit (10)(v) to the 1999 Form 10-K Annual
Report.

     (v)          Amended  and  Restated  1996  Unit Incentive Plan for Key
Employees  of  Borden,  Inc.  and  Associated  Persons,  as of December 31, 2000
incorporated  herein  by  reference  to  Exhibit  (10)(vi) to the 2000 Form 10-K
Annual  Report.

    (vi)         1994  Stock  Option  Plan  incorporated  by reference to
Exhibit  (10)(v)  to  the  1993  Form  10-K  Annual  Report.

   (vii)         Executive  Supplemental  Pension  Plan  Amended  and
Restated  as of January, 1996 incorporated by reference to Exhibit (10)(xiii) to
the  1998  Form  10-K  Annual  Report.

  (viii)         Advisory  Directors  Plan, incorporated herein by reference
from  Exhibit  (10)(viii)  to  the  1989  Form  10-K  Annual  Report.

   (ix)          Advisory  Directors  Plan  Trust Agreement, incorporated
herein  by  reference from Exhibit (10)(ix) to the 1988 Form 10-K Annual Report.


    (x)          Management  Agreements
                 ----------------------

     (a)     Employment  Agreement  with  W.  F. Stoll, Jr., dated June 6, 1996,
incorporated  by  reference  to Exhibit (10)(vi) to the June 30, 1996 Form 10-Q.

     (b)     Summary  of  Terms  of  Employment for Mr. Morrison incorporated by
reference  from  Exhibit (10)(i) to the Form 10-Q for the period ended March 31,
2002.

     (c)     Pay  Agreement  and Release of M. E. Ducey dated December 20, 2001,
incorporated  by  reference  from  Exhibit  (xi)(c) to the 2001 Form 10-K Annual
Report.

(d)  Summary  Terms of Employment for Joseph P. Bevilaqua dated January 7, 2002.

(e)  Summary  Terms  of  Employment  for  C.R.  Kidder  dated  March  2003.


   (xi)        2000  Management  Incentive  Plan  for  Borden  Capital
Management  Partners incorporated herein by reference to Exhibit (10)(xv) to the
2000  Form  10-K  Annual  Report.

   (xii)       1996  Stock  Purchase and Option Plan for Key Employees of Borden
Chemical,  Inc.,  and  Subsidiaries,  as  amended  March  2002,  incorporated by
reference  to  Exhibit  (10)  (xvi)  to  the  2001 Form 10-     K Annual Report.

   (xiii)      Form  of Warrant issued November 24, 2001 to purchase common
stock of Borden  Chemical,  Inc., incorporated herein by reference to Exhibit
(10)(xxi) to the  2001  Form  10-K  Annual  Report.

     (xiv)    Form  of  Management  Stockholder  Agreement incorporated
by reference from  Exhibit  (10)  (xxii)  to  the  2001  Form  10-K
Annual  Report.

     (xv)     Form  of  Non-Qualified  Stock  Option  Agreement  incorporated by
reference  from  Exhibit  (10)  (xxiii)  to  the  2001  Form 10-K Annual Report.

    (xvii)     Perquisite  Benefits  Policy,  incorporated by reference to
Exhibit  (10)(xviii)  to  the  2001  Form  10-K  Annual  Report.

    (xviii)    Certificate of Merger of Borden Chemical Holdings, Inc. into
Borden, Inc.  November 21, 2001incorporated by reference from Exhibit (10)
(xvii)to the 2001  Form  10-K  Annual  Report.

    (xix)      Consulting  Agreement  dated  August  21, 1995, incorporated
herein by reference  to  Exhibit  10  to  the  September  30,  1995
Form  10-Q.

     (xx)      Amendment  dated  May  30,  2002 to Consulting Agreement
with Kohlberg, Kravis,  Roberts  &  Co.,  LP dated August 21, 1995,
incorporated by reference to Exhibit  (10)  to  the  June  30,  2002
Form  10-Q.

   (xxi)       Joint  Management Services Agreement dated October 1,  2001
between Borden Chemical, Inc. and Borden Capital, Inc., incorporated by
reference  to  Exhibit  (10)  (xiv)  to  the  2001  Form  10-K  Annual  Report.

   (xxii)     Pledge  and  Assignment Agreement, dated as of January 18, 2002,
made by  Borden  Chemical,  Inc.  (formerly  known  as  Borden,  Inc.),
a New Jersey Corporation  (the  "Pledgor"),  to  Credit  Suisse First Boston,
incorporated by reference  to  Exhibit  (10)  (xix)  to  the  2001  Form  10-K
Annual  Report.

   (xxiii)     Reimbursement  agreement  for  Uncommitted Letter of Credit
Facility between  Credit  Suisse  First  Boston,  New York Branch dated
January 18, 2002, incorporated  by  reference  to  Exhibit  (10)(xx)  to
the 2001 Form 10-K Annual Report.

   (xxiv)     First  Amendment,  dated  as  of March 27, 2002, to the
Reimbursement agreement  for Uncommitted letter of Credit Facility between
Credit Suisse First Boston,  New  York  Branch  dated January 18, 2002,
incorporated by reference to Exhibit  (10)(ii)  to  the  March  31,  2002
Form  10-Q.

    (xxv)      Second  Amendment,  dated  as  of April 30, 2002, to
the Reimbursement agreement  for Uncommitted letter of Credit Facility
between Credit Suisse First Boston,  New  York  Branch  dated
January 18, 2002, incorporated by reference to Exhibit  (10)(iii)  to
the  March  31,  2002  Form  10-Q.

    (xxvi)     Master  Asset  Conveyance  and Facility Support Agreement
dated as of December  20,  2002  between  the  Company  and  Borden
Chemicals  and Plastics Operating  Limited  Partnership.

    (xxvii)     Environmental  Servitude  Agreement  dated  as  of
December 20, 2002 between  the  Company  and  Borden  Chemicals
and  Plastics  Operating  Limited Partnership.

    (xxviii)    Settlement  Agreement  dated  September 13, 2002 among
the Company, Borden  Chemicals  and  Plastics  Operating Limited
Partnership, BCP Management, Inc.,  the  U.S.  E.P.A., and the Louisiana
Department of Environmental Quality.

     (21)       Subsidiaries  of  Registrant.

     (23)(i)    Accountants'  Consent.

     (99)       Certificates  Pursuant  to  18  U.S.C.  Section 1350, as
Adopted  pursuant  to  Section  906  of  the  Sarbanes-Oxley  Act  of  2002.

     (27)       Financial  Data  Schedule

Item  15(b)     Reports  on  Form  8-K
                ----------------------
                No reports on Form 8-K were filed during fourth quarter 2002.
















































































                          INDEPENDENT AUDITORS' REPORT



To  the  Board  of  Directors
and  Shareholders  of  Borden  Chemical,  Inc.



We have audited the consolidated financial statements of Borden Chemical, Inc.
(a subsidiary of Borden Holdings, Inc.) and subsidiaries as of December 31, 2002
and 2001, and for each of the three years in the period ended December 31, 2002,
and have issued our report thereon dated March 12, 2003 (which report expresses
an unqualified opinion and includes an explanatory paragraph regarding the
Company's adoption in 2002 of Statement of Financial Accounting Standard No.
142); such financial statements and report are included elsewhere in this Form
10-K. Our audits also included the financial statement schedule of Borden
Chemical, Inc. and subsidiaries, listed in Item 15. This consolidated financial
statement schedule is the responsibility of the Company's management. Our
responsibility is to express an opinion based on our audits. In our opinion,
such consolidated financial statement schedule, when considered in relation to
the basic financial statements taken as a whole, presents fairly in all material
respects the information set forth therein.


DELOITTE  &  TOUCHE  LLP

Columbus,  Ohio
March  12,  2003

























































SCHEDULE  II  -  VALUATION  AND  QUALIFYING  ACCOUNTS
<TABLE>
<CAPTION>
<BTB>
----------------------------------------------------------------------------------------------------------------------------------
<S>                                    <C>                         <C>                    <C>                            <C>
                                       Balance                   Charged to                                           Balance
                                 December 31, 1999                Expense                Write-offs             December 31, 2000
----------------------------------------------------------------------------------------------------------------------------------
Allowance for
doubtful accounts                     $10,972                      $3,735                $(2,053)                    $12,654
----------------------------------------------------------------------------------------------------------------------------------
                                       Balance                   Charged to                                           Balance
                                 December 31, 2000                Expense                Write-offs             December 31, 2001
----------------------------------------------------------------------------------------------------------------------------------
Allowance for
doubtful accounts                     $12,654                      $5,175                $(1,170)                   $16,659
----------------------------------------------------------------------------------------------------------------------------------
                                       Balance                   Charged to                                           Balance
                                  December 31, 2001               Expense                Write-offs             December 31, 2002
----------------------------------------------------------------------------------------------------------------------------------
Allowance for doubtful accounts       $16,659                      $ (690)               $(3,750)                   $12,219
----------------------------------------------------------------------------------------------------------------------------------

</TABLE>
























































                        SIGNATURES




     Pursuant  to  the  requirements  of  Section  13 or 15(d) of the Securities
Exchange  Act  of  1934, the Company has duly caused this report to be signed on
its  behalf  by  the  undersigned,  thereunto  duly  authorized.


                       BORDEN,  INC.
                          /s/ William H. Carter
                       By----------------
                       William  H.  Carter
                       Executive  Vice  President  and
                       Chief  Financial  Officer (Principal  Financial  Officer)

Date:  March  28,  2003


     Pursuant  to  the requirements of the Securities Exchange Act of 1934, this
report  has  been signed below by the following persons on behalf of the Company
and  in  the  capacities  indicated,  on  the  date  set  forth  above.


Signature           Title                            Signature           Title
---------           -----                            ---------           -----


/s/ C. Robert Kidder                                 /s/ Craig O. Morrison
----------------- Chairman of the Board              ----------------- Director
C. Robert Kidder                                     Craig  O.  Morrison
/s/ Henry R. Kravis                                  /s/ Paul J. Norris
----------------- Director                           ----------------- Director
Henry  R.  Kravis                                    Paul  J.  Norris
/s/ John K. Saer                                     /s/ Kevin M. Kelley
----------------- Director                           ----------------- Director
John  K.  Saer                                       Kevin  M.  Kelley
/s/ George R. Roberts                                /s/ Brian F. Carroll
----------------- Director                           ----------------- Director
George  R.  Roberts                                  Brian  F.  Carroll
/s/ Scott M. Stuart                                  /s/ William H. Carter
----------------- Director                           ----------------- Director
Scott  M.  Stuart                                    William  H.  Carter
/s/ William F. Stoll Jr.
----------------- Director
William  F.  Stoll  Jr.









































                                                            EXHIBIT  (3)(II)

                                                      As  of  November  4,  2002

                                     BY-LAWS

                                       OF

                              BORDEN CHEMICAL, INC.
                             (Formerly Borden, Inc.)


                                    ARTICLE I

                                     OFFICES

     Places  of  business or offices may be established at any time by the board
of  directors  (the  Board)  at  any  place  or  places where the Corporation is
qualified  to  do  business  or  where  qualification  is  not  required.

                                   ARTICLE II

                            MEETINGS OF SHAREHOLDERS

     SECTION  1.  An  annual  meeting  of  the  shareholders for the election of
directors  and  for  the transaction of such other business as may properly come
before  the meeting shall be held upon not less than the ten nor more than sixty
days written notice of the time, place and purposes of the meeting.  The meeting
shall  be  held  at  such time and place as shall be designated by the Board and
specified  in  the  notice  of  the  meeting.

     SECTION  2.  Special  meetings  of shareholders shall be held at such place
and  at  such  time as shall be fixed by resolution of the Board with respect to
each  such  meeting  and may be called at any time by the Chairman of the Board,
Chief  Executive  Officer  or  President  or  a  majority of the directors.  Any
special  meeting  of  shareholders shall be held upon not less than ten nor more
than  sixty  days written notice of the time, place, and purpose of the meeting.

     SECTION 3.  Except as otherwise provided by law or the Restated Certificate
of  Incorporation  of the Company, at all meetings of the shareholders, in order
to  constitute  a  quorum, there shall be present, either in person or by proxy,
shareholders  entitled  to  cast  a  majority  of  the  votes  at  such meeting.

     SECTION  4.  At all meetings of the shareholders, each shareholder shall be
entitled to one vote for each share of the capital stock standing in his name on
the  books  of  the  Company,  except  as  otherwise  provided  by  the Restated
Certificate  of  Incorporation  of  the  Company.

     SECTION  5.  At  all  meetings of the shareholders any shareholder shall be
entitled  to  vote  by  proxy.  Every  proxy shall be executed in writing by the
shareholder  or  his  agent except that a proxy may be given by a shareholder or
his agent by telegram or cable or by any means of electronic communication which
results  in  a  writing.

     SECTION 6.  For the purpose of determining the shareholders entitled to (a)
notice  of or to vote at any meeting of shareholders or any adjournment thereof,
(b)  give  a  written  consent  to  any action without a meeting, or (c) receive
payment  of  any  dividend  or allotment of any right, or for the purpose of any
other  corporate  action  or event, the Board may fix, in advance, a date as the
record date for any such determination of shareholders.  Such dates shall not be
more than sixty nor less than ten days before the date of such meeting, nor more
than  sixty  days  prior  to  any  other  action.  The  record date to determine
shareholders  entitled  to  give  a written consent may not be more than 60 days
before  the  date  fixed  for tabulation of the consents or, if no date has been
fixed  for  tabulation,  more than 60 days before the last day on which consents
received  may  be  counted.

     If  no  record  date  is  so  fixed by the Board, (a) the record date for a
meeting of shareholders shall be the close of business on the day next preceding
the  day  on  which  notice  is  given,  or, if no notice is given, the day next
preceding  the  day  on  which  the meeting is held, and (b) the record date for
determining shareholders for any other purpose shall be at the close of business
on  the  day  on  which the resolution of the Board relating thereto is adopted.

     When  a determination of shareholders of record entitled to notice of or to
vote  at  any meeting of shareholders has been made as provided in this Section,
such  determination  shall  apply  to  any adjournment thereof, unless the Board
fixes  a  new  record  date  under  this  Section  for  the  adjourned  meeting.

     SECTION  7.  The  affirmative  vote  of  a  majority  of  votes cast by the
shareholders  shall  be required to authorize or approve any action or matter to
be  voted  upon  by  the shareholders, except that directors shall be elected as
provided  by  law.

     SECTION  8.  Unless  otherwise  determined  by  resolution  of  the  Board,

(a)     the  Chairman  of  the  Board  shall,  or shall designate an appropriate
officer of the Company to, call any annual or special meeting of shareholders to
order,  act  as  Chairman of any such meeting of the shareholders, determine the
order  of  business  of  any  such meeting, and determine the rules of order and
procedure  to  be  followed  in  the  conduct  of  any  such  meeting;  and

 (b)     the  Secretary  or  an  Assistant Secretary of the Company shall act as
Secretary  of  the  meeting.

     Nothing  in  this  section  shall prohibit the Chairman of the meeting from
changing  the  order  in  which  business  shall  be  presented  to the meeting.

     SECTION  9.  The  shareholders may act without a meeting by written consent
or  consents  pursuant to N.J.S. 14A:5-6.  The written consent or consents shall
be  filed  in  the  minute  book.

                                   ARTICLE III

                                    DIRECTORS

     SECTION  1.  The business and affairs of the Company shall be managed by or
under  the direction of a Board of Directors consisting of not less than one nor
more  than  fifteen  directors.  Subject  to  the  provisions  of  the  Restated
Certificate  of  Incorporation of the Company, the members of the Board shall be
elected  at  each  annual  meeting of shareholders of the Company to hold office
until  the  next annual meeting, and the term of each director shall be from the
time  of his election and qualification until the annual meeting of shareholders
next succeeding his election and until his successor shall have been elected and
shall  have  qualified.  The Chairman of the Board shall be elected by the Board
from  time  to time and shall serve as Chairman of the Board until his successor
shall  have  been  elected  and shall have qualified.  The Chairman of the Board
shall  be  a  director, and may serve as an officer or otherwise be an employee.

SECTION  2.  If the office of any director is not filled at an annual meeting or
becomes  vacant,  or  if  new  directorships  resulting  from an increase in the
authorized number of directors are created, the remaining directors (even though
less than a quorum) by a majority vote, or the sole remaining director, may fill
such  directorship.  A  director  so  elected  shall  hold office until the next
annual  meeting of shareholders and until his successor is elected and qualified
in  his  stead.   Any  directorship not filled by the Board may be filled by the
shareholders  at  an  annual  meeting  or  at  a special meeting called for that
purpose.

     SECTION  3.  The  Board shall have the power to remove a director for cause
and  to  suspend  a director pending a final determination that cause exists for
removal.

     SECTION  4.  There shall be an annual meeting of the Board for the election
of  officers  and  for such other business as may be brought before the meeting,
immediately  after  the  annual  meeting  of  shareholders.

SECTION  5.  Regular  meetings  of  the Board may be held without notice at such
time  and  place  as  shall  from  time  to  time  be  determined  by the Board.

     SECTION  6.  Special meetings of the Board may be called by the Chairman of
the  Board,  Chief  Executive Officer, President or by any two directors at such
time  and place as specified in a notice delivered personally or by telephone to
each  director,  or mailed, telegraphed or sent by facsimile transmission to his
address  upon  the  books of the Company, at least two days prior to the time of
holding  the  meeting.  The  notice  of  meeting  need not, but may, specify the
purpose  of  the  meeting.

     SECTION  7.  A  majority  of  directors  shall  constitute a quorum for the
transaction  of  business.  Any  action  approved  by a majority of the votes of
directors present at a meeting at which a quorum is present, shall be the act of
the  Board.

     SECTION  8.  The Board may act without a meeting if, prior or subsequent to
the  action,  each  member  of the Board consents in writing to the action.  The
written  consent  or  consents  shall  be  filed  in  the  minute  book.

     SECTION 9.  Any director may participate in a meeting of the Board by means
of conference telephone or any other means of communication by which all persons
participating  in  the  meeting  are  able  to  hear  each  other.

                                   ARTICLE IV

                                    OFFICERS

     SECTION  1.  The  officers  of the Company may consist of a Chief Executive
Officer, a President, one or more Vice Presidents, a Secretary, a Treasurer, and
a General Controller and one or more Assistant Secretaries, Assistant Treasurers
and  Assistant  General  Controllers.  The said officers shall be elected at the
annual  meeting  of the Board by a majority vote of the Board and shall serve at
the  pleasure  of the Board and shall be subject to removal at any time, with or
without  cause,  provided,  however, that the Board may at its pleasure omit the
election  of  any  of the foregoing officers not required by law. One person may
hold  more  than  one  office.

     SECTION  2.  The  said officers shall have the powers and shall perform all
the  duties  incident  to  their  said respective offices and shall perform such
other  duties  as  shall  from  time  to  time be assigned to them by the Board.

SECTION  3.  The  Chairman or, in his absence, a director selected by a majority
of  the  Directors, shall preside at meetings of the Board.  Each Vice President
or  other  officer shall have general charge of such departments or divisions of
the  Company's  business, or shall perform such duties, as may from time to time
be  determined  by the Chief Executive Officer and they shall be responsible for
the  proper  administration  of their respective departments or divisions to the
Chief  Executive  Officer.  Departmental  managers  shall be responsible for the
proper  administration  of  their  departments to the officer in charge thereof.

     SECTION  4.  During  the  absence of the Chief Executive Officer, the Chief
Executive  Officer  shall  designate, in writing to the Corporate Secretary, the
officer who shall be vested with all the powers of such office in respect of the
signing  and  execution of any contracts or other papers requiring the signature
of  any  such  absent  officer.  In  the  event  of any prolonged absence of any
officer of the Company, the Board may delegate his powers or duties to any other
executive  officer,  or  to any director, during such absence, and the person so
delegated  shall,  for the time being, be the officer whose powers and duties he
so  assumes.

     SECTION  5.  The Board may create such other offices as they may determine,
elect  or  provide  for  the election of officers to fill the same, define their
powers and duties and fix their tenures of office.  The Board may also create or
provide  for  the  creation of (1) administrative divisions, and (2) offices and
committees  for  any such divisions and may elect or provide for the election of
officers  and committee members to fill the positions so created, define or make
provision for the duties to be performed by such officers and committees and the
powers  to  be  exercised by them and fix or make provision for their tenures of
office.  The  Board  may delegate to the Chief Executive Officer or to any other
officer  or  any committee of the Company the power to exercise some, any or all
of  the powers granted to the Board by the foregoing provisions of this Section.
The  Chief  Executive  Officer  in turn may delegate to any other officer or any
committee  of  the  Company the power to exercise some, any or all of the powers
delegated  to  him  by  the  Board  pursuant to the foregoing provisions of this
Section.

                                    ARTICLE V

                                   COMMITTEES

     SECTION  1.  There  shall  be an Executive Committee consisting of three or
more  directors.  The  membership of this Committee shall consist of such number
of  directors  as  the  Board  may, by a resolution adopted by a majority of the
entire  Board,  elect  from  time to time and their terms of office shall be for
such  periods  as the Board may designate.  A majority of all the members of the
Committee  shall constitute a quorum for the transaction of business.  The Board
or  Executive  Committee members shall elect the Chairman of the Committee.  The
Committee  shall  determine  its  own  procedure  and  shall meet on call by the
Chairman  of  the Committee or by any two members of the Committee.  In addition
to  any  general or special duties that may from time to time be delegated to it
by  the  Board,  the  Committee  shall,  subject to the laws of the State of New
Jersey,  have  and  may  exercise  the  powers of the Board during the intervals
between  the  meetings of the Board, including the periodic review of management
organization.


SECTION  2.  There  shall  be  an  Audit  Committee  comprised  of  two  or more
directors.  The  members  shall  be  elected  by  the  Board,  or  the Executive
Committee,  either  of  which shall also elect the Chairman of the Committee.  A
majority  of  the  members  shall  constitute  a  quorum  of  the  Committee.

The  Committee  shall  assist  the  Board  in  fulfilling  its  fiduciary
responsibilities  relating  to  accounting  policies,  auditing  and  reporting
practices  for  the  Company  and  shall,  through  regularly scheduled meetings
provide  a  direct  line  of  communication  between the Board and the Company's
independent  accountants,  as  well  as  the internal auditor.  It shall receive
management's  recommendation  of the independent auditing firm for the next year
and  make  its  recommendation  to  be  approved  by  the  Board.

     It  shall  review  with  the  independent  auditing  firm  the scope of its
examination,  the consolidated financial statements prior to the approval of the
annual report by the Board, the competence and adequacy of financial, accounting
and  internal  audit  management  and  control  procedures  of  the  Company,
recommendations  of  the independent auditors and management's response thereto,
the internal audit function and such other matters relating to financial reports
as  it  deems appropriate.  It will require that serious differences between the
independent  auditors  and  the  management  be  reported  to  it.

     SECTION  3.  There shall be a Committee on Officers' Compensation comprised
of  three  or  more  directors. The members shall be elected by the Board or the
Executive  Committee,  either  of  which  shall  also  elect the Chairman of the
Committee. A majority of the members shall constitute a quorum of the Committee.

     The Committee shall establish salaries for elected officers of the Company.
It shall be responsible for the administration of the Management Incentive Plan,
other  incentive  compensation  plans  and  related  subjects.  It  shall  also
supervise  and  administer  such  employee benefits plans as the Chief Executive
Officer  or  the  Board  shall,  from  time  to  time,  direct.

     SECTION 4. The Board may, by resolution adopted by a majority of the entire
Board,  appoint  additional  committees,  each  of  which shall have one or more
members.  The  Committees of the Board shall each keep a record of their actions
and  proceedings,  and  all  their actions shall be reported to the Board at its
next  ensuing meeting; except that, when the meeting of the Board is held within
2  days after the committee meeting, such report shall, if not made at the first
meeting,  be  made  to  the Board at its second meeting following such committee
meeting.  (amd.11/14/02)

                                   ARTICLE VI

                                WAIVERS OF NOTICE

     Any  notice  required  by  these  by-laws,  by  the Restated Certificate of
Incorporation,  or  by  the New Jersey Business Corporation Act may be waived in
writing  by  any  person  entitled  to  notice.  The  waiver, or waivers, may be
executed  either  before  or after the event with respect to which the notice is
waived.  Each  director  or  shareholder attending a meeting without protesting,
prior to its conclusion, the lack of proper notice, shall be deemed conclusively
to  have  waived  notice  of  the  meeting.


                                   ARTICLE VII

                         DEPOSITORIES, CHECKS AND NOTES

     SECTION  1.  The Chairman of the Board, Chief Executive Officer, President,
Chief  Financial  Officer,  Treasurer  or  an Assistant Treasurer of the Company
shall  each  have  the  authority  to  designate banks, trust companies or other
depositories  in  which funds of the Company shall be deposited to the credit of
the  Company.  All  checks,  drafts and orders for the payment of money shall be
signed  by any one of the aforesaid officers, or by such other person or persons
as  the  Board  or  anyone  of  the  aforesaid  officers  may  from time to time
designate.  Subject  to  such limitations, restrictions and safeguards as any of
the  aforesaid  officers  shall prescribe, signatures in the case of all checks,
drafts  and  orders  for  the  payment  of  money  may  be facsimile signatures.

     SECTION  2.  The signature of any officer upon any bond, debenture, note or
similar instrument executed on behalf of the Company may be a facsimile whenever
authorized  by  the  Board.

                                  ARTICLE VIII

                                    DIVIDENDS

     Subject  to  the  provisions  of  law  and  the  Restated  Certificate  of
Incorporation  of  the Company, the Board shall have the power in its discretion
to  declare  and  pay  dividends  upon the shares of stock of the Company of any
class  in  cash, in its own shares, in its bonds or in other property, including
the shares or bonds of other corporations.  Anything in the Restated Certificate
of  Incorporation or these by-laws to the contrary notwithstanding, no holder of
any  share  of  stock  of  the  Company of any class shall have any right to any
dividend  thereon  unless such dividend shall have been declared by the Board as
aforesaid.

                                   ARTICLE IX

                                      SEAL

     The  seal  of  the Company shall be circular in form with the words "Borden
Chemical,  Inc.  New  Jersey  1899"  on  the  circumference.  (amd.11/04/02)

                                    ARTICLE X

                                      STOCK

     SECTION  1.  Certificates  of  stock  shall  be  issued  and  signed by the
Chairman  of  the  Board, Chief Executive Officer, President or a Vice President
and  may  be  countersigned  by  the  Treasurer or an Assistant Treasurer or the
Secretary  or  an  Assistant  Secretary  and  may be sealed with the seal of the
Company  or  a  facsimile  thereof.  Any  or  all signatures upon a certificate,
including  those of a stock transfer agent or a registrar, may be facsimile.  In
case  any  officer or officers or any transfer agent or registrar of the Company
who  shall  have  signed,  or whose facsimile signature or signatures shall have
been  used  on any certificate or certificates shall cease to be such officer or
officers,  or  such transfer agent or registrar, for whatever cause, before such
certificate  or  certificates  shall  have  been  delivered, such certificate or
certificates  may  nevertheless  be issued and delivered as though the person or
persons who signed such certificate or certificates or whose facsimile signature
or  signatures shall have been used thereon had not ceased to be such officer or
officers  or  such  transfer  agent  or  registrar,  as  the  case  may  be.

     SECTION  2.  All  transfers  of  stock  shall be made upon the books of the
Company  upon  surrender  to  the Company of the certificate or certificates for
such  stock,  duly  endorsed  or  accompanied  by proper evidence of succession,
assignment  or  authority  to  transfer.

     SECTION  3.  Every  person claiming a stock certificate in lieu of one lost
or  destroyed shall give notice to the Company of such loss and destruction, and
shall also file in the office of the Company an affidavit as to his ownership of
the stock represented by the certificate, and of the facts which go to prove its
loss  or destruction.  He shall, if required by the Board of Directors, give the
Company  a  bond  or agreement of indemnity in a form to be approved by counsel,
with or without sureties and in such amount as may be determined by the Board or
by  an  officer  in  whom  authority therefor shall have been duly vested by the
Board  against  all  loss, cost and damage which may arise from issuing such new
certificate.  The  officers of the Company, if satisfied from the proof that the
certificate is lost or destroyed, may then issue to him a new certificate of the
same  tenor  as  the  one  lost  or  destroyed.

SECTION  4.  The Board shall have the power and authority to make all such rules
and  regulations  as  it  may  deem expedient concerning the issue, transfer and
registration  of  certificates  for  shares of the capital stock of the Company.
The  Board  may  appoint  transfer  agents  and  registrars of transfer, and may
require  any  or  all  stock  certificates  to  bear  the signature or facsimile
signature  of  any  such  transfer  agent  and  any such registrar of transfers.

     SECTION 5.  Unless the Board by specific resolution provides otherwise, all
shares  of  the  Company,  which  are  reacquired  pursuant  to  the  New Jersey
Corporation  Act,  Section  l4A:7-l6  by  purchase,  by  redemption  or by their
conversion  into other shares of the Company, shall remain authorized and issued
shares  and  shall  be  considered  treasury  shares.










                                   ARTICLE XI

                                   FISCAL YEAR

     SECTION  1.  The fiscal year of the Company shall commence on the first day
of  January  in each year and end on the following thirty-first day of December.

     SECTION  2.  It  shall  be  the  duty of the principal financial officer to
submit a full report of the financial condition of the Company for the preceding
fiscal  year  at  a  meeting  of  the  Board  preceding  the  annual  meeting of
shareholders.


                                   ARTICLE XII

                              AMENDMENTS TO BY-LAWS

     SECTION  1.  These  by-laws are subject to the provisions of the New Jersey
Business  Corporation  Act  and  the  Corporation's  Restated  Certificate  of
Incorporation,  as  each  may be amended from time to time.  If any provision in
these  by-laws  is  inconsistent  with  a  provision in that Act or the Restated
Certificate  of  Incorporation,  the  provision  of  that  Act  or  the Restated
Certificate  of  Incorporation  shall  govern.

     SECTION  2.  These  by-laws  may  be  altered,  amended, or repealed by the
shareholders  or  the  Board.  Any by-law adopted or amended by the shareholders
may  be  amended  or  repealed  by  the  Board,  unless  the  resolution  of the
shareholders  adopting  the  by-law  expressly  reserves to the shareholders the
right  to  amend  or  repeal  it.













                                               Exhibit 10(x)(d)

                       SUMMARY OF TERMS OF EMPLOYMENT FOR
                                 JODY BEVILAQUA
                             Revised January 7, 2002


Title:     Strategic  Planning, Borden Chemical, Inc. reporting to the President
           and  CEO  of  BCI

Start  Date:     March  2002,  coordinated  with  the  start  of  the  new  CEO.

Location:     Headquarters  is located in Columbus, OH. Home purchase and moving
              assistance are provided under the BCI relocation program. Since
              you are about to complete the sale of your current home you will
              be able to immediately work with BCI's  relocation  company  upon
              accepting  this  offer.

              Temporary living and travel expenses will also be provided for you
              and your family  for  a  reasonable  transition  period.  It is
              anticipated that you will relocate  to  Columbus  in  the  near
              future.

Base  Salary:     $250,000  annually  with  a  review  each  year,  beginning in
                  March  2003.

Bonus  Opportunity:     Participation  in  the annual BCI incentive program at a
                        target  of 40% of base salary; participation during the
                        first year will be based on  total  year  results,  but
                        will  be pro-rated to reflect the period worked; awards
                        are  authorized  by the Compensation Committee of the
                        Board and are made based  on  achievement  against
                       financial targets (EBITDA and ROGI) and business metrics;
                        the  opportunity  can  reach  up to a 200% payout based
                        on performance exceeding  targets.

Equity  Investment:     The  long-term  incentive plan has been designed to have
                        highly attractive rewards for achieving the BCI business
                        plan. In your case, you will  have  an  opportunity to
                        invest up to $250,000 in shares of BCI stock at a
                        purchase  price of $2.25 per share. A portion of your
                        investment may be financed through  Fifth  Third  Bank,
                        which  has  an  attractive program for equity plan
                        participants.

                        Based  on  an  investment  of  $250,000,  you  will
                        receive 111,111 shares. Additionally,  you  will
                        receive  105,333  options  with  a strike  price  of
                        $2.25.  These options, along with your equity
                        investment, are targeted  to  generate  a  pre-tax
                        return of nearly $1.0 MM if the base business plan  is
                        achieved over a five-year period. Your investment is
                        requested prior to beginning  your Borden career. Once
                        you invest, options will vest and the shares will
                        become  unrestricted  ratably  over  five  years.

                        In  addition,  529,100  shares of restricted stock will
                        be granted at a price of $2.25  per  share.  All of
                        these shares will become unrestricted (vest) upon the
                        completion  of  your third full year at Borden Chemical.
                        One half (50%) of these shares  will  be liquid at the
                        time of vesting. The remaining 50% will be liquid at
                        the  end  of  your  fourth  full year. After your third
                        anniversary with the company, you may choose to sell
                        your vested shares to the company. The value you receive
                        would  be  determined  by applying a multiple of 7.6
                        times the trailing 12-month  EBITDA.  The  value  would
                        be  set at the time you request your first payment.  Any
                        subsequent payments would be made using the same
                        valuation. Prior to  a  regular  liquidity  event,
                        shares may be sold up to a total value of $1.0 million.

                        Assuming  BCI's  strategic  plan  is achieved, the total
                        value of the restricted shares  is  estimated  to be
                        $3.0 million in 2006. If the company terminates you
                        for  reasons  other  than  cause,  one  third  of your
                        shares will be treated as unrestricted  upon  the
                        completion  of  12  months  of  employment  and will be
                        purchased  by  the  company  by  applying  a  multiple
                        of 7.6 times the trailing 12-month  EBITDA.  Thereafter,
                        the remaining shares become unrestricted in four equal
                        installments  at the completion of 18 months, 24 months,
                        30 months and 36 months  of  service.

                        In  the  event  you  die  or  become totally disabled
                        while participating in the equity  plan,  you  become
                        fully  vested  in  each  component  of  the  plan.

                        In  the  event  that  the return on your equity plan
                        investment is negative, due solely  to the existence
                        of a preexisting material condition or liability, which
                        as  part  of  or  in  combination  with Other  Net
                        Liabilities  significantly  exceeds the dollar amounts
                        for Other Net Liabilities included in the attached
                        projections, the Company will purchase your investment
                        at  a  price  equal  to  your  initial investment. In
                        the event this occurs, the proceeds from the repurchase
                        of shares from your original investment will  be
                        included  in  the  return  of  the $250,000. Your
                        unvested options and restricted  shares  will  be
                        cancelled  at  that  time.

                        Taken  together, the core equity plan, the
                        "Performance Options", the restricted shares,  and
                        the  dividends  on the shares owned provide an
                        opportunity to earn approximately  $4.4 MM if strategic
                        plan goals are met. This opportunity is over 17.6  times
                        your  investment.

                        Note:  You  will  receive  formal equity plan offering
                       documents prior to making your  investment.  These
                       documents  govern  administration of the plan and will
                       superscede  this  summary.

Perquisite  Allowance: A  cash allowance of $25,000 will be paid annually to
                      cover  perquisites  of  your  choosing.  Typical  uses
                     include  a  car lease,  country  club,  dining  club,  etc.

Benefits:              Summary: You will receive a detailed summary of BCI
                       benefits at an orientation  by Judy Sonnett, VP HR BCI,
                       upon your hire; highlights of the plans are  noted
                       below  with actual benefits subject to the terms and
                       conditions of the individual  plan  documents,
                        including  vesting  and  eligibility  periods.

                      Medical:Provided  through  the  Borden,  Inc.  Total
                      Family Protection  Plan.  Current  coverage  choices
                      are  a  PPO  or  an      HMO.

                      Dental:  Provided  through  the  Borden,  Inc.  Total
                      Family  Protection  Plan. Current-coverage  choices  are
                      a  scheduled  benefit  plan  or  an  R&C  plan.

                      Pension  Plan:  Pension  benefits  are  provided  under
                      the Borden,  Inc.  Employees  Retirement  Income  Plan,
                      a  cash account  plan.  The  plan  formula  is  3%  up
                      to  the  Social Security  Wage  Base  and  6%  over  the
                      Social  Security  Wage Base  (the  2002  SSWB  is
                      $84,900).

                      401  K  Savings:  Savings  plan  benefits  are  provided
                      under  the Borden,  Inc.  Retirement  Savings  Plan.  The
                      company  match  is $1.00  for  each  dollar  on  the
                      first  5%  of  employee      contributions.

                     SERP:  Pension  and savings plan benefits for salary in
                     excess of the IRS Annual Plan  Compensation  Limit  are
                     provided  under  the  Borden,  Inc.  Executive
                     Supplemental  Pension  Plan.  (2002  IRS  Annual  Plan
                     Compensation  Limit  is $200,000).


 Life  Insurance:  Basic  life  coverage  is  two  times  benefits  pay  at
                   an  employee  cost  of  9  1/2  for  each  $1,000  of
                   coverage.  You may  purchase  supplemental  insurance
                   coverage  if  desired.

Disability:        Salary  Continuance  coverage  is  provided;  benefit
                   is  company  paid.  Long  Term  Disability  coverage
                   with  a replacement  ratio  of  60%  on  $200,000  of
                   income.

Vacation:          3  weeks.

Severance:        In  the event you are terminated by the company for reasons
                  other than  for  cause, you would be eligible to receive
                  severance for 12 months based on  your  monthly  base  salary
                  in  effect  at  that  time.

Alcan  Incentive  In  the event that Alcan does not make an incentive payment
                  for Treatment:     2001  or  makes a substantially reduced
                  payment, Borden will make up  the difference between the
                  payment and your target, which is $63,750 (30% of your
                  current  base  salary  of  $212,800). All  BCI  employees  are
                  required to successfully complete a pre-employment drug
                  screening  and  background  check;  Judy  Sonnett  will
                  make  the  appropriate arrangements.

Transition:       The  Borden  team  is  eager  to  work  with  you  on  a
                  smooth transition.






Offered:       /s/ C. Robert Kidder          Date:  1/8/02
               ------------------------          ---------
              C.  Robert  Kidder


Accepted:   /s/ Joseph P. Bevilaqua          Date:  1/9/02
           ---------------------------             -------
           Joseph P. Bevilaqua





























































March 11, 2003
                                                           Exhibit 10(x)(e)



                                    AGREEMENT

This  agreement contains all the understandings between C. Robert Kidder ("you")
and  Borden Capital, Inc., or one of its parents, subsidiaries or affiliates and
their  officers, employees and agents (referred to individually and collectively
as  the "Company"), in connection with the termination of your employment.  This
agreement  provides  the  specific details of certain payments to be received by
you  and  the  conditions  agreed  to  by you for the receipt of those payments.

     In  consideration for the mutual promises and valuable consideration below,
and  with  the intent to be legally bound, you and the Company agree as follows:

1.  Your  employment  with  the  Company  will terminate on March 31, 2003 (your
"termination  date").

2.  a)  The  Company  will  pay  you  a  gross  total  amount  of
Two-Million-Five-Hundred-Sixty-Five-Thousand-Eight-Hundred-Eighty-Eight  Dollars
($2,565,888.00) in termination payments to be paid to you in a lump sum on April
11, 2003.  This amount represents (24) months of pay at your current annual base
pay  of  One-Million-Two-Hundred-Eighty-Two-Thousand-Nine-Hundred-Forty-Four
Dollars  ($1,282,944.00).  For  the  purpose of this Agreement, your  "Severance
Period"  is  defined as the period beginning on your termination date and ending
March  29,  2005.  You  are  considered  to  be released by the Company prior to
liquidation  and,  therefore,  provided  that  you  continue to work through the
termination  date,  you  will  receive  a
One-Million-Seven-Hundred-Eighteen-Thousand-Eight-Hundred-Eighty  Dollar
($1,718,880.00)  payment  as  a  "stay  bonus",  payable  by  April  11,  2003.
Deductions as required by law will be made from all termination payments and the
"stay  bonus".  Also,  deductions  for  cash  advances  and other money due  the
Company  and  as  permitted  by  statute  or  regulation,  will be made from the
termination  payments.

b)  Your  period  of  COBRA  eligibility  begins on your termination date and is
available  to  you  for 18 months from that date.  Continued healthcare coverage
during  your  severance  period  is  part of the 18 months of continued coverage
provided  by COBRA.  As you have a 24-month coverage extension in your severance
agreement,  the full COBRA coverage time allotment will be satisfied during your
severance  period.  During your 24-month severance period, the cost of continued
coverage  will  be  the  same  as  the  amount  charged  to  active  employees.


     I elect  X decline_________ the above described medical/dental continuation
             --
at  normal  active  associate  contribution  rates.

c)  If  you  have  elected  to  continue  your medical coverage under the Borden
Chemical, Inc. Total Family Protection Plan during your entire severance period,
at  the end of your severance period you may if you so elect, participate in the
Borden  Chemical,  Inc.  Retiree  Medical Plan.  Your coverage under the Retiree
Medical  plan  can  be  maintained:
a.     As  long  as  Borden  Chemical, Inc. offers retiree medical coverage, and
b.     Provided  you  make  your  monthly  retiree contributions by the due date
In  the  event you elect to continue COBRA coverage after your severance period,
you  will forfeit your eligibility to participate in the Borden Chemical Retiree
Medical  Program.

d)  Any  money due from Company benefit plans will be paid to you in addition to
the  amount  under  this  agreement  in accordance with the terms of such plans.

e)  During  your  severance  period  the  Company  will  provide  you  with  an
outplacement  assistance  program  with  an outplacement service selected by the
Company  and  for  a  fee  determined  and  paid  by the Company.  The Company's
obligation in this regard shall be limited to the payment of the determined fees
for  such  outplacement  services.  The  Company  shall  not  be  considered  as
guarantor  or  as  warranting the results of the services provided, and you will
hold  the  Company  harmless  from, and waive any claims against the Company, in
connection  with  the  services  provided  by  such  consultants.

f)  You  agree  to  conduct  yourself  in  a manner which does not disparage the
Company,  nor  is  damaging  to  or  otherwise  contrary  to  the Company's best
interests.  And  you  agree  that  this  agreement  is strictly confidential and
neither  you nor the Company will reveal its terms except in connection with the
Company's SEC filing requirements or an official investigation or legal process.
You also agree to immediately return to the Company credit cards, keys, records,
policy  and  procedure  manuals,  business  contracts,  and other documentation,
information, any copies of such documentation, and any property belonging to the
Company.

g)  You  agree to accept the money and benefits paid to you under this agreement
as  full  settlement  of all claims and causes of action, if any, arising out of
your  employment  by  the  Company  and  the  termination  of  that  employment.

h)  You  agree that you are entering into this agreement and release as your own
free  decision  in  order  to  receive the payments and other benefits described
above.  You  understand  that,  except  for  those payments and benefits legally
required,  the Company would not make these payments or extend these benefits to
you  without  your  voluntary  consent  to  this  agreement.

i)  You  agree  that by signing this agreement, you are giving up your right to,
and  agreeing  not  to,  file  charges  or  lawsuits  with respect to any matter
occurring  on or before the effective date of this agreement, including, but not
limited to, discrimination you believe you have suffered due to age, disability,
race,  sex,  religion,  national origin or for any other reason occurring during
your employment by the Company or pertaining the termination of that employment,
including  but  not  limited to, any and all claims under Title VII of the Civil
Rights Act of 1964, the Age Discrimination in Employment Act, the Equal Pay Act,
the  National  Labor Relations Act, the Rehabilitation Act of 1973, Section 1981
of  the  Civil Rights Act of 1866, the Civil Rights Act of 1991, Executive Order
11246  and  any  other executive order, the Americans with Disabilities Act, the
Family  and  Medical  Leave  Act  of  1993, the Worker Adjustment and Retraining
Notification  Act,  the  Older  Workers  Benefit  Protection Act, the Fair Labor
Standards  Act, the Ohio Wage Discrimination Law, the Ohio Civil Rights Act, all
as  amended,  and under any other federal, state, or local ordinance, regulation
or  law,  and under any contract, and under any theory of libel, slander, breach
of contract, wrongful discharge, detrimental reliance, intentional infliction of
emotional  distress,  tort,  or any other theory under the common law and claims
for uncompensated expenses, litigation and court costs, severance pay, incentive
or bonus pay, overtime pay or any other form of compensation, with the exception
of  any  claim  the  law  precludes  you  from  waiving  by  agreement.

j)  You  agree  that,  should  you breach this agreement by filing any charge or
complaint or beginning any suit as described in the previous paragraphs, without
waiving  the Company's right to seek to enforce this agreement, the Company will
have  no  further obligation to provide you with additional termination payments
or  the  completion  bonus or any other consideration that may be due under this
agreement  and  all  other  provisions  of this agreement will remain in effect.

k)  You  understand  that this agreement will not prevent you from: (1) filing a
charge  of  age discrimination with the Equal Employment Opportunity Commission;
(2)  cooperating  with  the  Equal  Employment  Opportunity  Commission  in  an
investigation into alleged age discrimination; or (3) testifying in any cause of
action  when  required to do so by valid subpoena or other compulsory process of
law.  However,  you agree that, by entering in to this agreement, you waive your
right  to recover any damages or other relief in any claim or suit brought by or
through  the Equal Employment Opportunity Commission or any other federal, state
or  local agency on behalf of Employee under federal, state or local law, except
where  prohibited  by  law.

3.  You  understand  that  you  are  100%  vested in your original investment of
369,569  units  and  7,391,380  UAR's, and 50% vested in your July, 2000 BWH LLC
grant  of  4,834,350  UARs.  Your investment and grant will be treated under the
terms  of  the  Plans.  You will receive the value of these UARs, if any, at the
wind-up  of  the  BWH  LLC  portfolio.

4.  You  will  be  paid  for  earned  (accrued) but unused vacation on the first
scheduled  payroll  after
your  termination  date.

5.  You  acknowledge your execution of a Borden Security Agreement dated July 9,
2001  copy  attached,  and  your  continuing  obligations  under  the agreement.

6.   In  deciding whether to accept this agreement, you understand that you have
forty-five  (45)  days to seek the advice and counsel from an attorney if you so
choose  or  to  otherwise  consider  the  terms  of  this  agreement.

7.  You  agree  that  this  agreement  will  be construed under Ohio Law, unless
otherwise  controlled  by federal law, and that any action brought by you or the
Company under this agreement may be filed and maintained only in the appropriate
court  having jurisdiction over Franklin County, Ohio.  You also agree that this
agreement contains the entire agreement between you and the Company, and that it
may  be  changed  only  in  a  writing  signed  by  you  and  the  Company.

8.  Should  any  provision of this agreement, other than your release and waiver
of  claims  against  the  Company,  be declared or determined by any court to be
illegal  or  invalid,  the validity of the remaining parts shall not be affected
thereby,  and the illegal or invalid part shall be deemed not to be part of this
agreement.












9.  This  agreement  shall  not  become  effective  until  after  seven (7) days
following  the  date  that  you sign the agreement.  Prior to that time, you may
elect  to  revoke  this  agreement by signing and dating the Cancellation Notice
below  and  delivering  it  to  the  Company.


     Very  truly  yours,
                              Borden  Capital,  Inc.

                              By:  /s/  Ellen  German  Berndt
                                   --------------------------
                              Ellen  German  Berndt,  Secretary



ACCEPTED:

/s/  C.  Robert  Kidder
-----------------------
                                                WITNESS:
Date  March  28,  2003                         /s/  George  F.  Knight
      ----------------                         -----------------------
at  Columbus,  Ohio                         George  F.  Knight


                               CANCELLATION NOTICE
(To  cancel  this  Agreement  sign and deliver this copy of the Agreement to the
Company  within  7  days  of  the  date  you  signed  the  Agreement.)

I  hereby  cancel  this  Agreement.

________________                    __________________
Date                                            Signature
---------------------------------------------------------





















































                              Addendum to Agreement
                              ---------------------

     In further consideration of the mutual promises and agreements contained in
the  Agreement  dated March 28, 2003 between C. Robert Kidder ("Mr. Kidder") and
Borden  Capital,  Inc. (the "Company") in connection with the termination of Mr.
Kidder's  employment  (the  "Agreement"),  the  parties  agree  as  follows:

1.     The  Company  will  transfer  to  Mr.  Kidder  all rights to the existing
membership  in  the  New  Albany Country Club currently used by Mr. Kidder.  Mr.
Kidder  will  be  solely  responsible  for all charges, dues or assessments with
respect  to  such  membership,  whether incurred prior to or after the transfer.

2.     The  Company  will  provide  office  space in the Borden Building for Mr.
Kidder  and one administrative assistant for as long as he is providing services
to  current  or former affiliates of the Company; provided, however, the Company
may terminate this benefit on a change of control of Borden Chemical, Inc. or if
space  becomes  unavailable  in  the  Borden  Building.

     This  Addendum  is  an  integral  part  of  the  Agreement.

Accepted:                                       Borden  Capital,  Inc.




/s/ C. Robert Kidder                           By:  /s/ William H. Carter
----------------------                              ----------------------
C.  Robert  Kidder                              William  H.  Carter
                                                Director
Date:  3-28-03
       -------































































                                                             EXHIBIT  10  (XXVI)









                             MASTER ASSET CONVEYANCE
                                       AND
                           FACILITY SUPPORT AGREEMENT
                          DATED AS OF DECEMBER 20, 2002
                                     BETWEEN
                              BORDEN CHEMICAL, INC.
                                       AND
           BORDEN CHEMICALS AND PLASTICS OPERATING LIMITED PARTNERSHIP



































































                                TABLE OF CONTENTS
                                                                            Page
                                                                            ----

ARTICLE  I:   DEFINITIONS     103
ARTICLE  II:   REPRESENTATIONS  AND  WARRANTIES     106
2.1.     Representations  and  Warranties  of  BCP     106
2.2.     Representations  and  Warranties  of  BCI     106
2.3.     No  Other  Representations  or  Warranties     107
ARTICLE  III:   COVENANTS     107
3.1.     Real  Property  Conveyances     108
3.2.     Other  Asset  Conveyances     108
3.3.     Utilities  Conveyances     108
3.4.     Reciprocal  Servitude  Agreement     108
3.5.     Waste  Water  Assets     109
3.6.     Geismar  Environmental  Allocation  Agreement     109
3.7.     Environmental  Servitude  Agreement     109
3.8.     Certain  Fees.     109
3.9.     Further  Assurances     109
ARTICLE  IV:   CLOSING
4.1.     Conditions  Precedent  to  Obligations  of  Parties.     110
4.2.     Conditions  Precedent  to  the  Obligation  of  BCI     110
4.3.     Conditions  Precedent  to  the  Obligation  of  BCP     110
4.4.     Closing.     111
ARTICLE  V:   TERMINATION     111
5.1.     Termination     111
ARTICLE  VI:   MISCELLANEOUS     111
6.1.     Notices     111
6.2.     Severability     113
6.3.     Counterparts     113
6.4.     Entire  Agreement;  No  Third  Party  Beneficiaries     113
6.5.     Governing  Law     113
6.6.     Consent  to  Jurisdiction     113
6.7.     Assignment     114
6.8.     Expenses     114

SCHEDULES
---------

Schedule  2.1(d)                    Permitted  Liens  on  BCP  Exchange Property

Schedule  2.2(d)                    Permitted  Liens  on  BCI  Exchange Property
Schedule  3.2               Methanol  Maintenance  Shop  Tools  and  Equipment

Schedule  3.10               Terms  of  Conveyance  Instruments

EXHIBITS
--------
EXHIBIT  A-1                    Real Property and Improvements to be Conveyed to
BCI
EXHIBIT  A-2                    Real  Property  to  be  Conveyed  to  BCP
EXHIBIT  B                    Utilities
EXHIBIT  C                    Operating  Agreement  and  Lease
EXHIBIT  D                    Geismar  Environmental  Allocation  Agreement
EXHIBIT  E                    Environmental  Servitude  Agreement
EXHIBIT  F                    Location  of  BCI  Formaldehyde  Pipeline
EXHIBIT  G                    Settlement  Agreement



































                             MASTER ASSET CONVEYANCE
                                       AND
                           FACILITY SUPPORT AGREEMENT
     MASTER  ASSET  CONVEYANCE  AND  FACILITY  SUPPORT  AGREEMENT  , dated as of
December  __,  2002  ("Master  Agreement"), between BORDEN CHEMICAL, INC., a New
Jersey corporation with an office at 180 East Broad Street, Columbus, Ohio 43215
(hereinafter  "BCI")  and  BORDEN  CHEMICALS  AND  PLASTICS  OPERATING  LIMITED
PARTNERSHIP,  a  Delaware limited partnership with offices at Highway 73 and 30,
Geismar,  Louisiana,  70734  (hereinafter  "BCP").
                                   WITNESSETH:
     WHEREAS,  on April 3, 2001, BCP filed a voluntary petition for relief under
Chapter  11 of the Bankruptcy Code, 11 U.S.C. Sections 101-1330 (the "Bankruptcy
Code),  in  the United States Bankruptcy Court for the District of Delaware (the
"Bankruptcy  Court")  under case number 01-1268 (the "Bankruptcy Case"); and BCP
is  continuing  in  possession  or  its  properties  and  acting  as a debtor in
possession  pursuant  to  sections  1107  and  1108  of  the  Bankruptcy  Code;
     WHEREAS,  BCP owns a chemical manufacturing and production facility located
in or near Geismar, Ascension Parish, Louisiana, consisting of approximately 370
acres  (the  "Geismar  Facility");
     WHEREAS,  BCP  previously  used  the Geismar Facility for the production of
certain  chemical  products;
     WHEREAS,  BCP  continues  to  own and operate certain assets at the Geismar
Facility,  including  water  treatment  assets  used  for  treatment  of process
wastewater  and  of  certain  storm  water  and  groundwater associated with the
Geismar  Facility;
     WHEREAS,  BCI  owns  and  operates  (i)  plants  for  the  manufacture  of
formaldehyde  (ii)  a  methanol  tank  farm  (iii) a barge dock and (iv) related
assets  located at or near the Geismar Facility (collectively, the "Formaldehyde
Plant");
     WHEREAS,  the  Formaldehyde  Plant  has been afforded access to the support
assets  of  the  Geismar  Facility  and  the  general  facility support services
provided  by  BCP  in  connection  with BCP's operation of the Geismar Facility;
     WHEREAS,  on  June  11,  1998,  in  United  States  v. Borden Chemicals and
Plastics  Operating  Limited  Partnership,  No.  94-2592-A-M2, the United States
District  Court  for  the  Middle District of Louisiana entered a consent decree
(the "Consent Decree") between BCP, the United States and the State of Louisiana
in  resolution of certain environmental claims relating to the Geismar Facility;
WHEREAS,  although  certain  obligations  under  the  Consent  Decree  have been
completed,  certain obligations under the Consent Decree remain to be performed;
WHEREAS, the parties wish to facilitate the orderly and efficient implementation
of  the  work  at  the  Geismar  Facility  called  for under the Consent Decree;
WHEREAS,  this  Master  Agreement  and  the transactions contemplated herein are
subject  to the prior approval of the Bankruptcy Court, after notice and hearing
in  the  Bankruptcy  Case  (the  "Bankruptcy  Court  Approval");  and
WHEREAS,  upon  Bankruptcy  Court Approval, BCP and BCI desire to consummate the
transactions  contemplated by this Master Agreement in accordance with the terms
and  conditions  hereinafter  set  forth.
NOW,  THEREFORE, in order to implement the foregoing and in consideration of the
mutual  representations,  warranties, covenants and agreements contained herein,
the  parties  hereto  agree  as  follows:
                           ARTICLE I.     DEFINITIONS
     "Affiliate" means a Person that directly, or indirectly through one or more
intermediaries,  controls, or is controlled by, or is under common control with,
a  specified  Person.  For  the  purposes hereof, the term "control" (including,
with  correlative  meanings, the terms "controlling", "controlled by" and "under
common  control with"), as applied to any Person, means the possession, directly
or  indirectly,  of the power to direct or cause the direction of the management
or  policies  of that Person, whether through the ownership of voting securities
or  by  contract  or  otherwise.
"Bankruptcy  Case"  shall have the meaning set forth in the first whereas clause
above.
"Bankruptcy  Code"  shall have the meaning set forth in the first whereas clause
above.
"Bankruptcy  Court" means the United States Bankruptcy Court for the District of
Delaware.
"Bankruptcy  Court  Approval"  shall  have  the  meaning  set forth in the tenth
whereas  clause  above.
"BCI"  shall  have  the  meaning  set  forth  in  the  preamble  above.
"BCI  Exchange Property" means the real property set forth on Exhibit A-2 hereof
to  be  conveyed  to  BCP  pursuant  to the provisions of Section 3.1(b) hereof.
"BCP"  shall  have  the  meaning  set  forth  in  the  preamble  above.
"BCP  Exchange  Property"  means the real property and improvements set forth on
Exhibit  A-1  hereof to be conveyed to BCI pursuant to the provisions of Section
3.1(a)  hereof.
"BCP  Site"  means  the Geismar Facility, after giving effect to the conveyances
described  in  Section  3.1  hereof.
"Closing"  shall  have  the  meaning  set  forth  in  Section  4.4  hereof.
"Closing  Date"  shall  have  the  meaning  set  forth  in  Section  4.4 hereof.
"Consent  Decree" shall have the meaning set forth in the seventh whereas clause
above.
"Environmental  Servitude Agreement" means the Environmental Servitude Agreement
entered  into  by  BCP  and  BCI  on  the Closing Date substantially in the form
attached  hereto  as  Exhibit  E.
"Formaldehyde  Plant"  shall  have  the  meaning  set forth in the fifth whereas
clause  above.
"Geismar  Environmental Allocation Agreement" means the Environmental Allocation
Agreement  entered  into by BCP and BCI on the Closing Date substantially in the
form  attached  hereto  as  Exhibit  D.
"Geismar Facility" shall have the meaning set forth in the second whereas clause
above.
"Governmental  Authority"  means  any  domestic  or  foreign, national, federal,
provincial,  state,  parish, municipal or other local government or body and any
division,  agent,  commission,  board  or authority of any quasi-governmental or
private  body  exercising  any  statutory,  regulatory,  expropriation or taxing
authority  under the authority of any of the foregoing, any domestic or foreign,
international,  judicial,  quasi-judicial,  arbitration or administrative court,
tribunal,  commission,  board  or panel acting under the authority of any of the
foregoing.
"Governmental  Approval" means any approval, consent, license, permit, waiver or
other  authorization  issued,  granted,  given or otherwise made available by or
under  the  authority  of  any  Governmental  Authority  or pursuant to any Law.
"Law"  means  any  law  (including  common law), statute, code, ordinance, rule,
regulation,  authorization  or  other  requirement  of a Governmental Authority.
"Lien"  or  "Liens"  means  any  lien, pledge, mortgage, deed of trust, security
interest,  claim,  lease,  charge,  option,  right  of  first refusal, easement,
servitude,  transfer  restriction,  encumbrance  or  any  other  restriction  or
limitation  whatsoever.
"Master  Agreement"  shall  have  the  meaning  set forth in the preamble above.
"Methanol  Plant"  means  the  land  leased by BCI to BCP pursuant to the Ground
Lease  dated  July  28,  2000.
"Monochem  Substation" means the main electrical substation operated by Monochem
on  a  1.865  acre  parcel  of  land  it  owns  at  the  Geismar  Facility  .
"Permit"  means any approval, authorization, consent, license, permit, franchise
or  certificate  required  by  or  issued  by  any  Governmental  Authority.
"Permitted  Liens"  means  those Liens described in Schedules 2.1(d) and 2.2(d).
"Person"  means  any  individual, firm, unincorporated organization, corporation
(including  any  not  for  profit  corporation), general or limited partnership,
limited  liability  company,  joint venture, estate, trust, association or other
entity  (including  any  Governmental  Authority).
"Reciprocal  Servitude  Agreement" shall mean the Reciprocal Servitude Agreement
and  Assignment  of  Servitudes,  dated  July  28, 2000, between BCI and BCP, as
amended.
"Settlement  Agreement" means the Settlement Agreement to be entered into by and
between  BCP,  BCP  Management,  Inc.,  BCI,  the United States on behalf of the
Environmental  Protection  Agency  and the Louisiana Department of Environmental
Quality  in  the  form  attached  hereto  as  Exhibit  G.
"Shop  Tools"  shall  have  the  meaning  set  forth  in  Section  3.2  hereof.
"Utilities"  means those pipe racks, pipelines, utility lines, cables, conduits,
switchgear  and  feeders  described  in  Exhibit  B  attached  hereto.

                            REPRESENTATIONS AND WARRANTIES
                        Representations and Warranties of BCP
                        -------------------------------------
     .BCP  hereby  represents  and  warrants  to  BCI  as  follows:
     -
     Partnership Existence and Power. BCP is a Delaware limited partnership duly
     -------------------------------
formed  and validly existing and in good standing under the laws of the State of
Delaware and upon Bankruptcy Court Approval shall have all requisite partnership
power  and  authority  to  execute  this  Master  Agreement  and  consummate the
transactions  contemplated  hereby.
     Authorization.  Subject  to  Bankruptcy  Court Approval, (i) the execution,
delivery and performance by BCP of this Master Agreement and the consummation by
BCP  of the transactions contemplated hereby are within BCP's partnership powers
and have been duly authorized by all necessary partnership action on the part of
BCP  and  (ii)  this  Master  Agreement  constitutes,  and  each other agreement
executed  and  delivered or to be executed and delivered by BCP pursuant to this
Master  Agreement  will,  upon such execution and delivery, constitute, a legal,
valid  and  binding obligation of BCP enforceable against BCP in accordance with
its  terms.
     Conflicts.  Subject to Bankruptcy Court Approval, none of the execution and
     ---------
delivery  by  BCP of this Master Agreement, the consummation of the transactions
contemplated hereby, or compliance by BCP with any of the provisions hereof will
(i)  conflict  with,  or  result  in  the  breach  of,  any  provision  of  the
organizational  documents  of  BCP;  (ii)  conflict with, violate, result in the
breach  or  termination  of,  or  constitute  a  default  under  any note, bond,
mortgage,  indenture,  license,  agreement  or other instrument or obligation to
which  BCP  is  a  party  or  by which BCP or any of its properties or assets is
bound;  (iii)  violate  any  statute,  rule,  regulation, order or decree of any
Governmental  Authority;  or  (iv)  result  in the creation of any Lien upon the
properties or assets of BCP other than those arising under or in connection with
the  Operating Agreement and Lease, the Environmental Servitude Agreement or the
Reciprocal  Servitude Agreement or the Liens referenced in Sections 3.4, 3.5 and
3.7  hereof.  Except  as  set  forth  on  Section  4.1(b),  no  consent, waiver,
approval,  order,  Permit or authorization of, or declaration or filing with, or
notification to, any Person or Governmental Authority is required on the part of
BCP  in  connection with the execution and delivery of this Master Agreement, or
the  compliance  by  BCP,  with  any  of  the  provisions  hereof.
     BCP  Exchange  Property.  BCP  has good and marketable fee title to all BCP
     -----------------------
Exchange  Property,  free and clear of all Liens of any nature whatsoever except
(i)  Permitted  Liens  set  forth on Schedule 2.1(d), (ii) such imperfections of
title  and  Liens as do not materially detract from or materially interfere with
the  use  of  the  properties  subject thereto or affected thereby, or otherwise
materially  impair  the  business  operations  involving  such  properties.
     Tangible  Personal Property and Utilities.  BCP (i) has good and marketable
     -----------------------------------------
title to all tangible personal property and Utilities that are to be conveyed to
BCI  pursuant  to Sections 3.2 and 3.3 free and clear of all Liens and (ii) upon
consummation of the transactions contemplated by this Master Agreement, BCI will
obtain good and marketable title to, and be entitled to continue to use all such
tangible  personal  property  and  Utilities  free  and  clear  of  all  Liens.
                        Representations and Warranties of BCI
                        -------------------------------------
     .  BCI  hereby  represents  and  warrants  to  BCP  as  follows:
     -
     Corporate  Existence and Power. BCI is a New Jersey corporation duly formed
     ------------------------------
and  validly  existing  and  in good standing under the laws of the State of New
Jersey  and  has  all  requisite  corporate  power and authority to execute this
Master  Agreement  and  consummate  the  transactions  contemplated  hereby.
     Authorization.  The  execution,  delivery  and  performance  by BCI of this
     -------------
Master  Agreement  and  the consummation by BCI of the transactions contemplated
hereby  are  within  BCI's corporate powers and have been duly authorized by all
necessary  corporate  action  on  the  part  of  BCI.  This  Master  Agreement
constitutes,  and  each other agreement executed and delivered or to be executed
and delivered by BCI pursuant to this Master Agreement will, upon such execution
and  delivery,  constitute,  a  legal,  valid  and  binding  obligation  of  BCI
enforceable  against BCI in accordance with its terms, except to the extent that
such  enforceability  may  be limited by bankruptcy, insolvency, reorganization,
moratorium  or  other  Laws relating to or affecting creditors' rights generally
and  by  general  equitable  principles.
     Conflicts.  None  of  the  execution  and  delivery  by  BCI of this Master
     ---------
Agreement,  the  consummation  of  the  transactions  contemplated  hereby,  or
     -
compliance  by  BCI with any of the provisions hereof will (i) conflict with, or
     -
result  in  the breach of, any provision of the organizational documents of BCI;
(ii)  conflict  with,  violate,  result  in  the  breach  or  termination of, or
constitute  a  default  under  any  note,  bond,  mortgage,  indenture, license,
agreement  or other instrument or obligation to which BCI is a party or by which
BCI  or  any  of  its  properties or assets is bound; (iii) violate any statute,
rule,  regulation, order or decree of any Governmental Authority; or (iv) result
in  the  creation  of  any  Lien upon the properties or assets of BCI other than
those arising under or in connection with the Operating Agreement and Lease, the
Environmental  Servitude  Agreement or the Reciprocal Servitude Agreement or the
Liens  referenced in Section 3.4 hereof.  Except as set forth on Section 4.1(b),
no  consent, waiver, approval, order, Permit or authorization of, or declaration
or  filing  with,  or  notification  to, any Person or Governmental Authority is
required  on  the  part  of BCI in connection with the execution and delivery of
this  Master  Agreement,  or  the  compliance by BCI, with any of the provisions
hereof.
     BCI  Exchange  Property.  BCI  has good and marketable fee title to all BCI
     -----------------------
Exchange  Property,  free and clear of all Liens of any nature whatsoever except
(i)  Permitted  Liens  set  forth on Schedule 2.2(d), (ii) such imperfections of
title  and  Liens as do not materially detract from or materially interfere with
the  use  of  the  properties  subject thereto or affected thereby, or otherwise
materially impair the use of the properties subject thereto or affected thereby,
or  otherwise  materially  impair  the  business  operations  involving  such
properties.
                        No Other Representations or Warranties
                        --------------------------------------
     .  Except  for the representations and warranties contained in this Article
     -
II,  neither  BCP  nor  BCI,  nor  any  of their respective officers, directors,
employees,  agents  or  representatives,  made any representations or warranties
with  respect  to  the  execution  and  delivery of this Master Agreement or the
transactions  contemplated  hereby.
                                      COVENANTS
     In  consideration  of the mutual agreements and covenants set forth herein,
each  of  BCP  and  BCI  agree  as  follows:
                              Real Property Conveyances
                              -------------------------
     .  (a)  Subject  to  the terms and conditions of this Master Agreement, BCP
     -
agrees  that  at  the  Closing  it will convey to BCI the BCP Exchange Property.
(B)SUBJECT TO THE TERMS AND CONDITIONS OF THIS MASTER AGREEMENT, BCI AGREES THAT
         AT THE CLOSING IT WILL CONVEY TO BCP THE BCI EXCHANGE PROPERTY.


                               Other Asset Conveyances
                               -----------------------
     .  At  the Closing, BCP shall convey and deliver to BCI all of the methanol
     -
maintenance shop tools and equipment described on Schedule 3.2 hereto (the "Shop
Tools").
                                Utilities Conveyances
                                ---------------------
     .  BCP  agrees that, at the Closing, BCP shall convey to BCI the pipelines,
     -
utility  lines, cables, conduits, switchgear, and feeders described in Exhibit B
hereto  (collectively,  the  "Utilities").
                            Reciprocal Servitude Agreement
                            ------------------------------
     .The parties hereby agree that at the Closing, they shall amend and restate
     -
the  Reciprocal  Servitude  Agreement  in  order  to:
ratify  and  confirm  the  reciprocal  servitudes granted by BCP and BCI to each
other,  to ratify and confirm any servitudes granted by BCP to BCI and to ratify
and  confirm  any  servitudes  granted  by  BCI  to  BCP;
grant  to  BCI  a servitude for the location of Utilities on the BCP Site and to
give  BCI  the  right  to operate, maintain, alter, repair, replace, improve and
remove  the  Utilities  on BCP's land and the right to use for this purpose, and
maintain  alter,  repair,  replace and improve any and all pipe racks upon which
such  Utilities  are  located;
acknowledge  the new property boundaries between BCP and BCI created by the real
property  conveyances  described  in  Section  3.1  above;
grant  to BCI a servitude for the location of one additional 4 inch pipeline for
the  conveyance of formaldehyde across the BCP Site, at the approximate location
shown  in  Exhibit  F hereof and to provide BCI the right to construct, operate,
maintain,  alter,  repair,  replace,  improve  and  remove such pipeline for the
conveyance  of formaldehyde across BCP's land, at the approximate location shown
in  Exhibit  F  hereof;
grant  to BCI a servitude for the location of one electrical feeder across BCP's
land  and  running from the Monochem Substation to the Formaldehyde Plant and to
provide  BCI  the right to construct, operate, maintain, alter, repair, replace,
improve  and  remove  such  electrical feeder across BCP's land running from the
Monochem  Substation  to  the  Formaldehyde  Plant;
provide  that  any  purchaser  of  the  Geismar Facility shall have the right of
access  to and shared use of the Utilities as necessary for the operation of the
Geismar  Facility  and the right to be allocated such portion of the capacity of
the  Utilities  as  needed  for  such  operation,  subject  to  such purchaser's
agreement  to  pay  its  proportionate  share  of  the  costs  of  operating,
maintaining,  repairing,  replacing  and  improving  such  Utilities;  and
provide  that  all servitudes described in the Reciprocal Servitude Agreement as
amended  shall  have  a  perpetual duration until abandoned by BCI and shall not
terminate with the cessation of the exchange of utility services between BCI and
BCP.
     Waste  Water  Assets
     --------------------
     .  Each of BCP and BCI agree to enter into an Operating Agreement and Lease
     -
on  the  Closing  Date  substantially  in  the  form  of  Exhibit  C  hereto.
Section  1.01     Geismar Environmental Allocation AgreementOn the Closing Date,
                  ------------------------------------------
each  of  BCP  and  BCI agree to enter into the Geismar Environmental Allocation
Agreement  substantially  in  the  form  of  Exhibit  D  hereto.
     Environmental  Servitude  Agreement
     -----------------------------------
        On  the  Closing  Date,  each  of  BCP  and  BCI  agree to enter into an
Environmental Servitude Agreement substantially in the form of Exhibit E hereto.
                                    Certain Fees.
                                    -------------
      BCI  hereby  agrees  to  bear  all  reasonable  costs  associated with the
transfer or conveyance by BCP of any easement, covenant or other right of way to
BCI  in  connection with the transactions contemplated by this Master Agreement.
     Further  Assurances
     -------------------
     .  From time to time, and as and when requested by either party hereto, the
     -
other  party  shall  execute and deliver, or cause to be executed and delivered,
all  such  documents  and  instruments and shall take, or cause to be taken, all
such  further  actions  as  such  other  party  may reasonably deem necessary or
desirable to consummate and make effective the transactions contemplated by this
Master  Agreement.
     Terms  of  Conveyance.  The exchange of real property and the conveyance of
     ---------------------
tangible  personal  property  and  Utilities hereunder shall be made without any
warranties,  express  or  implied, except as to the grantor's own acts, but with
full  substitution  and  subrogation  to  all rights or cause of actions against
prior  owners.  To  give  effect  thereto,  the  exchange  of  property  and the
conveyance of other property between the parties hereto shall contain provisions
substantially  as  set  forth  in  Schedule  3.10  hereto,  and  the  conveyance
instrument  for  the exchange of property shall recite that the value of the BCP
Exchange  Property is equal in value to the BCI Exchange Property, the Utilities
and  the Shop Tools, coupled with the performance of obligations by BCI pursuant
to  this  Master  Agreement.
          Discharge  of Liens. Except for Permitted Liens, all Liens against the
          --------------------
BCP  Exchange  Property,  the Utilities and the Shop Tools shall be released and
discharged  by  the Bankruptcy Court in connection with such court's approval of
the  Settlement  Agreement.

                                       CLOSING
                   Conditions Precedent to Obligations of Parties.
                   -----------------------------------------------
       The  respective  obligations  of each of the parties hereto to consummate
the  transactions  contemplated  by  this  Master  Agreement  are subject to the
satisfaction  or  waiver,  at  or  prior  to  the  Closing  Date, of each of the
following  conditions:
     No  Injunction.  At  the  Closing  Date,  there  shall  be  no  injunction,
     --------------
restraining order or decree of any nature of any court or Governmental Authority
     ---
of  competent  jurisdiction  that  is  in effect that restrains or prohibits the
consummation  of  the  transactions  contemplated  by  this  Master  Agreement;
provided,  however,  that  the  party invoking this condition shall use its best
           -------
efforts to have any such injunction, order or decree vacated or denied (it being
understood that nothing in this Section 4.1(a) shall be construed as limiting or
affecting  any  provision  of  the  Settlement  Agreement).
     Governmental  Approvals.  (I)  Each  of  the  United  States  Department of
     -----------------------
Justice,  the  United  States  Environmental Protection Agency and the Louisiana
Department  of  Environmental  Quality,  as well as BCP, BCI and BCP Management,
Inc., shall have executed the Settlement Agreement attached hereto as Exhibit G,
and  the  Settlement  Agreement shall have been approved by the Bankruptcy Court
and  shall  have  become  effective  by  its  terms.
(i)     This  Master  Agreement  (including  the  Exhibits and Schedules hereto)
shall  have  been  approved  by  the  Bankruptcy  Court.
     Conditions  Precedent  to  the  Obligation  of  BCI
     ---------------------------------------------------
     .  The  obligation  of  BCI  to consummate the transactions contemplated by
     -
this  Master  Agreement is subject to the satisfaction or waiver, at or prior to
the  Closing  Date,  of  each  of  the  following  additional  conditions:
     Accuracy  of  Representations  and  Warranties.  The  representations  and
     ----------------------------------------------
warranties  of  BCP contained in this Master Agreement shall be true and correct
     -
in  all  material  respects  as of the Closing Date as if made at and as of such
date.
     Performance of Covenants.  BCP shall have complied in all material respects
     ------------------------
with  all of its covenants and obligations contained in this Master Agreement to
be  complied  with  by  it  prior  to  or  on  the  Closing  Date.
     Certificate.  BCI  shall  have  received  a certificate from BCP, dated the
     -----------
Closing  Date,  executed  on  behalf  of  BCP  by its chief executive officer/an
authorized  signatory  to the effect that the conditions specified in paragraphs
(a)  and  (b)  above  have  been  satisfied.
     Conditions  Precedent  to  the  Obligation  of  BCP
     ---------------------------------------------------
     .The  obligation of BCP to consummate the transactions contemplated by this
     -
Master Agreement is subject to the satisfaction or waiver by BCP, at or prior to
the  Closing  Date,  of  each  of  the  following  additional  conditions:
     Accuracy  of  Representations  and  Warranties.  The  representations  and
     ----------------------------------------------
warranties  of  the  BCI  contained  in  this Master Agreement shall be true and
     -
correct  in all material respects as of the Closing Date as if made at and as of
such  date.
     Performance of Covenants.  BCI shall have complied in all material respects
     ------------------------
with  all  covenants  and  obligations  contained in this Master Agreement to be
complied  with  by  it  prior  to  or  at  the  Closing  Date.
     Certificate.  BCP  shall  have  received  a  certificate  of BCI, dated the
     -----------
Closing  Date,  executed  on  behalf  of  BCI  by its chief executive officer/an
authorized  signatory  to the effect that the conditions specified in paragraphs
(a)  and  (b)  above  have  been  satisfied.
     Closing.
     --------
     Subject  to  the  satisfaction or waiver of all of the conditions precedent
set  forth  in  this  Article  IV,  the  closing ("Closing") of the transactions
contemplated  by this Master Agreement shall take place at the offices of BCI at
180 East Broad Street, Columbus,  Ohio, or at such other location as the parties
agree,  at  10:00am  on a date specified by the parties in writing (the "Closing
Date")  which  will  be no later than the 10th day following the satisfaction or
waiver  of all of the conditions precedent set forth in this Article IV.  At the
Closing,  the  parties  will cause each of the transactions contemplated by this
Master  Agreement not already consummated to be consummated.  Subject to Article
V,  the  failure  to  consummate  the  transactions  contemplated by this Master
Agreement on or prior to the Closing Date shall not result in the termination of
this  Master Agreement nor relieve any party of any obligation under this Master
Agreement.

                                     TERMINATION
                                     Termination
                                     -----------
     .  (a  )  General.  This  Master  Agreement  may  be  terminated  and  the
     -
transactions  contemplated hereby abandoned at any time prior to the Closing (i)
     -
by  mutual  written  consent  of  BCP  and BCI, (ii) by either BCP or BCI if the
Closing  has  not  occurred  on or prior to the 120th day following execution of
this  Master  Agreement;  provided,  however, that the party seeking termination
pursuant  to  this  Section  5.1(a)(ii)  in  not  in  breach  of  any  of  its
representations,  warranties,  covenants  or agreements contained in this Master
Agreement, or (iii) by either BCP or BCI if this Master Agreement shall have not
been  approved  by  the  Bankruptcy  Court on or prior to the 90th day following
execution  of  this  Master  Agreement.
(b)     Termination  Procedure.  In  the  event  of  termination  of this Master
        ----------------------
Agreement  by  any  party  hereto  pursuant  to this Section 5.1, written notice
thereof  shall  be  given promptly to the other party in accordance with Section
6.1  hereof  and the transactions contemplated by this Master Agreement shall be
terminated, without further action by any party; provided, however, that nothing
                                                 --------  -------
herein  shall  relieve  any  party  from  liability  for  any  breach  hereof.
     Survival  of  Certain  Provisions.  The  provisions  of  this Article V and
     ---------------------------------
Section  6.8  shall  survive  any  termination  of  this  Master  Agreement.

                                    MISCELLANEOUS
     Notices
     .  All notices under this Master Agreement shall be in writing and shall be
sent  registered  or  certified mail, return receipt requested, addressed to the
proper  party  shown  below,  unless  the  name  or said address shall have been
changed  by  written  notice:

If  to  BCI:
BORDEN  CHEMICAL,  INC.
180  East  Broad  Street
Columbus,  Ohio  43215
Attn:  President
with  copies  to:
BORDEN  CHEMICAL,  INC.
180  East  Broad  Street
Columbus,  Ohio  43215
Attn:  General  Counsel
If  to  BCP:
BORDEN  CHEMICALS  AND  PLASTICS  OPERATING  LIMITED  PARTNERSHIP
c/o  BCP  Management,  Inc.
Vorys,  Sater,  Seymour  and  Pease,  LLP
52  East  Gay  Street
Columbus,  OH  43216
Attn:  Joseph  D.  Lonardo

with  copies  to:

Lemle  &  Kelleher
601  Poydras  Street,  21st  Floor
New  Orleans,  LA  70130
Attn:  Mr.  E.  L.  Edwards

          and

     Jones,  Day,  Reavis  &  Pogue
     3500  SunTrust  Plaza
     303  Peachtree  Street,  N.E.
     Atlanta,  Georgia  30308-3242
     Attn:  Mr.  Neil  P.  Olack

SECTION  1.02     SEVERABILITY
                  ------------
     .  The  provisions  of this Master Agreement and the Schedules and Exhibits
     -
attached hereto shall be deemed severable and the invalidity or unenforceability
of  any  provision  shall not affect the validity or enforceability of the other
provisions  hereof.  If  any  provision  of this Master Agreement or any Exhibit
hereto,  or  the application thereof to any Person or any circumstance, is found
to  be invalid or unenforceable in any forum having jurisdiction, (i) a suitable
and  equitable provision shall be substituted therefor in order to carry out, so
far  as  may  be  valid or enforceable, such provision and (ii) the remainder of
this  Master Agreement and the application of such provision to other Persons or
circumstances  shall  not  be  affected  by such invalidity or unenforceability,
except to the extent of the mitigation provided for in clause (i) nor shall such
invalidity  or  unenforceability  affect  the validity or enforceability of such
provision,  or  the  application  thereof,  in  any  other  jurisdiction.
     COUNTERPARTS
     ------------
     .  This  Master Agreement may be executed in one or more counterparts, each
     -
of  which shall be deemed an original and all of which shall, taken together, be
considered  one  and  the  same  agreement.
     ENTIRE  AGREEMENT;  NO  THIRD  PARTY  BENEFICIARIES
     ---------------------------------------------------
     .  Except  for any other agreements entered into by the parties on the date
     -
hereof,and  except  for such prior agreements identified on Schedule 6.4 of this
Master  Agreement (the "Ancillary Agreements"), which Ancillary Agreements shall
not  be  modified, altered or affectedin any way by this Master Agreement or any
of its Exhibits or Schedulesunless expresslyprovided by this Master Agreement or
its  Exhibits or Schedules,this Master Agreement, together with its Exhibits and
Schedules  (i)  constitutes  the entire agreement as of the time of execution of
this  Master  Agreement  and supersedes all prior agreements and understandings,
both  written  and  oral,  among  BCP  and  BCI  with  respect to the matters or
conditions  addressed  herein (including the matters and conditions addressed in
the Schedules and Exhibits hereto) and (ii) except as provided in the Settlement
Agreement  or the Geismar Environmental Allocation Agreement, is not intended to
confer  upon  any  Person  other  than the parties hereto any rights or remedies
hereunder.  Enforcement  of this Master Agreement and its Exhibits and Schedules
shall  be the exclusive remedy of the parties with respect to any claim or cause
of  action  arising  out  of  any  such  matters  or  conditions.
     GOVERNING  LAW
     --------------
     .  This Agreement shall be governed by and construed in accordance with the
     -
laws  of  the  State  of  Louisiana.
     CONSENT  TO  JURISDICTION
     -------------------------
     .  Each  of  the  parties  hereto  irrevocably  submits  to  the  exclusive
     -
jurisdiction  of  the  Bankruptcy  Court for the purposes of any suit, action or
     -
other  proceeding  arising  out  of  this  Master  Agreement  or any transaction
contemplated  hereby.  Each of the parties hereto further agrees that service of
any process, summons, notice or document by U.S. registered mail to such party's
respective  address  set  forth  in  Section  6.1  shall be effective service of
process  for any action, suit or proceeding with respect to any matters to which
it has submitted to jurisdiction as set forth above in the immediately preceding
sentence.  Each of the parties hereto irrevocably and unconditionally waives any
objection  to  the laying of venue of any action, suit or proceeding arising out
of  this  Master Agreement or the transactions contemplated hereby or thereby in
the  Bankruptcy Court, and hereby further irrevocably and unconditionally waives
and agrees not to plead or claim in any such court that any such action, suit or
proceeding  brought in any such court has been brought in an inconvenient forum.
                                      ASSIGNMENT
                                      ----------
     .Neither  this  Master  Agreement  nor  any  of  the  rights or obligations
     -
hereunder  shall  be  assigned  by  any  of the parties hereto without the prior
     -
written  consent  of  BCI,  in the case of any assignment by BCP, or BCP, in the
case  of  any  assignment  by BCI, as applicable.  This Master Agreement will be
binding  upon,  inure  to  the  benefit of and be enforceable by the parties and
their  respective successors and permitted assigns.  Any attempted assignment in
violation  of  the  terms of this Section 6.7 shall be null and void, ab initio.
     EXPENSES
     --------
     .  Except  as  otherwise  expressly  specified  elsewhere  in  this  Master
     -
Agreement,  all  costs  and  expenses  incurred  in  connection with this Master
     -
Agreement  and  the  transactions contemplated by this Master Agreement shall be
     -
paid  by  the  party  incurring  such  cost  or  expense.






















IN  WITNESS  WHEREOF,  the parties have caused this Agreement to be executed and
--------------------------------------------------------------------------------
delivered  by  their  duly authorized officers to be effective as of the day and
--------------------------------------------------------------------------------
year  first  above  written.
----------------------------

BORDEN  CHEMICAL,  INC.

By:  ____________________________

Its:  _____________________________


BORDEN  CHEMICALS  AND  PLASTICS
OPERATING  LIMITED  PARTNERSHIP
By:  BCP  Management,  Inc.,  General  Partner

By:  ______________________________

Its:  ______________________________



































































                                                                     EXHIBIT A-1
                         REAL PROPERTY AND IMPROVEMENTS
                              TO BE CONVEYED TO BCI
     1.372  acres of land immediately north of the methanol maintenance building
(see  attached  metes  and  bounds  description).
     Four  stainless  tanks east of the formaldehyde plant and the approximately
0.25  acres  of  land  area  they occupy (the exact dimensions of which shall be
determined  by  survey).
     Demineralized  water  storage  tank  and the approximately 40 ft. by 40 ft.
parcel  of land area it occupies at the northeast corner of Formaldehyde Plant 3
with  two  pumps  (the exact dimensions of which shall be determined by survey).
     VE  Flare and the 0.009 acres of land it occupies (as shown as Inset "D" on
"Map  Showing Parcels 1, 2 and 3 Being a Portion of Borden Chemical and Plastics
Property  Located  in Sec. 11, T-10-S, R-2-E, Ascension Parish, Louisiana" drawn
be  Neel-Schaffer,  Inc.,  Brown & Butler Engineers, Planners, and dated July 6,
2000,  revised  July  20,  2000,  July  25,  2000  and  July  27,  2000).
     The  following  improvements  located on the Methanol Plant site previously
leased  from  BCI: (i) the methanol maintenance shop and (ii) carbon steel tanks
on south side of the Methanol Plant (four 350,000 gallon tanks and three smaller
tanks).  These  improvements  will  not be removed by BCP when it dismantles the
Methanol  Plant.































































                          METES AND BOUNDS DESCRIPTION
     OF
     A  CERTAIN  TRACT  OR  PARCEL  OF  LAND  CONTAINING
     1.372  ACRES  AND  BEING  DESIGNATED  AS  PARCEL  4
     LOCATED  IN  SECTION  11
     TOWNSHIP  10  SOUTH  -  RANGE  2  EAST
     ASCENSION  PARISH,  LOUISIANA

     A  certain  tract  or  parcel  of  land  containing  1.372  acres and being
designated as Parcel 4, located in Section 11, Township 10 South - Range 2 East,
Ascension  Parish,  Louisiana, and being more particularly described as follows:
From  a  POINT OF REFERENCE being the intersection of the southerly right of way
line  of  LA  Hwy.  73  and  the  westerly right of way line of Illinois Central
Railroad proceed North 58 17'16" West a distance of 25.41' to a point and corner
at  Plant  Grid  Coordinates  North  4154.04-East  2000.72;
thence proceed North 41 58'10" East a distance of 779.62' to a point and corner;
thence proceed North 42 25'10" East a distance of 1578.94' to a point and corner
at  Plant  Grid  Coordinates  North  4173.08-East  4359.39;
thence  proceed  South 47 16'00" East a distance of 302.96' to a set P-K nail at
Plant  Grid  Coordinates  North 3870.12-East 4359.39 and the POINT OF BEGINNING.
thence  proceed  N  42  13'57'' E a distance of 237.19' to a point and corner at
Plant  Grid  Coordinates  North  3872.19-East  4596.58;
thence  proceed  S  47  48'31'' E a distance of 122.95' to a point and corner at
Plant  Grid  Coordinates  North  3749.25-East  4597.73;
thence  proceed  S  71  20'17''  E a distance of 14.08' to a point and corner at
Plant  Grid  Coordinates  North  3736.39-East  4603.47;
thence  proceed  S  46  58'33'' E a distance of 113.60' to a point and corner at
Plant  Grid  Coordinates  North  3622.80-East  4602.90;
thence  proceed  S  42  44'00'' W a distance of 243.51' to a point and corner at
Plant  Grid  Coordinates  North  3622.80-East  4359.39;
     thence  proceed  N 47 16'00'' W a distance of 247.33' to a point and corner
at  Plant  Grid  Coordinates  North  3870.12-East  4359.39;  being  the POINT OF
BEGINNING  and  containing 1.372 acres more or less and is more fully shown on a
map  by  Neel-Schaffer,  Inc./Brown  & Butler, dated June 13, 2000, revised thru
xxxxxxx,  2002  and  titled  "Map Showing Parcels 1,2, 3 & 4, Being a Portion of
Borden  Chemical  and  Plastics  Property,  Located  In  Section  11,  T10S-R2E,
Ascension  Parish,  Louisiana."


















































                                                                     EXHIBIT A-2
                       REAL PROPERTY TO BE CONVEYED TO BCP

                          METES AND BOUNDS DESCRIPTION
     OF
     A  CERTAIN  TRACT  OR  PARCEL  OF  LAND  CONTAINING
     4.053  ACRES  AND  BEING  DESIGNATED  AS  PARCEL  3-B
     LOCATED  IN  SECTION  11
     TOWNSHIP  10  SOUTH  -  RANGE  2  EAST
     ASCENSION  PARISH,  LOUISIANA

     A  certain  tract  or  parcel  of  land  containing  4.053  acres and being
designated  as  Parcel  3-B,  located in Section 11, Township 10 South - Range 2
East,  Ascension  Parish,  Louisiana,  and  being more particularly described as
follows:
From  a  POINT OF REFERENCE being the intersection of the southerly right of way
line  of  LA  Hwy.  73  and  the  westerly right of way line of Illinois Central
Railroad proceed North 58 17'16" West a distance of 25.41' to a point and corner
at  Plant  Grid  Coordinates  North  4154.04-East  2000.72;
thence proceed North 41 58'10" East a distance of 779.62' to a point and corner;
thence proceed North 42 25'10" East a distance of 1578.94' to a point and corner
at  Plant  Grid  Coordinates  North  4173.08-East  4359.39;
thence proceed South 47 16'00" East a distance of 747.92'' to a point and corner
at  Plant  Grid  Coordinates  North  3425.16-East  4359.39;
thence proceed N 42 42'52'' E a distance of 242.51' to the POINT OF BEGINNING at
Plant  Grid  Coordinates  North  3425.25-East  4601.89;
thence  proceed  N  42  42'52'' E a distance of 484.10' to a point and corner at
Plant  Grid  Coordinates  North  3425.40-East  5086.05;
thence  proceed  S  47  16'09''  E a distance of 91.90' to a point and corner at
Plant  Grid  Coordinates  North  3333.50-East  5086.05;
thence  proceed  S  42  46'05''  W a distance of 97.45' to a point and corner at
Plant  Grid  Coordinates  North  3333.56-East  4988.60;
thence  proceed  S  47  23'57'' E a distance of 220.79' to a point and corner at
Plant  Grid  Coordinates  North  3112.78-East  4989.11;
thence  proceed  N  42  41'48'' E a distance of 129.43' to a point and corner at
Plant  Grid  Coordinates  North  3112.86-East  5118.54;
thence  proceed  S  47  06'21''  E a distance of 52.67' to a point and corner at
Plant  Grid  Coordinates  North  3060.19-East  5118.40;
thence proceed S 42 11'09'' W a distance of 5.97' to a point and corner at Plant
Grid  Coordinates  North  3060.13-East  5112.42;
thence  proceed  S  47  01'39''  E a distance of 94.77' to a point and corner at
Plant  Grid  Coordinates  North  2965.36-East  5112.03;
thence  proceed  S  42  41'53'' W a distance of 429.98' to a point and corner at
Plant  Grid  Coordinates  North  2965.09-East  4682.05;
thence  proceed  N  47  24'32'' W a distance of 319.42' to a point and corner at
Plant  Grid  Coordinates  North  3284.52-East  4681.25;
thence  proceed  S  42  40'48''  W a distance of 25.06' to a point and corner at
Plant  Grid  Coordinates  North  3284.49-East  4656.19;
thence  proceed  N  47  19'12''  W a distance of 64.74' to a point and corner at
Plant  Grid  Coordinates  North  3349.23-East  4656.13;
thence  proceed  S  42  40'48''  W a distance of 54.62' to a point and corner at
Plant  Grid  Coordinates  North  3349.18-East  4601.51;
     thence  proceed  N  46  56'16''  W  a  distance  of  76.06' to the POINT OF
BEGINNING  containing  4.053 acres more or less and is more fully shown on a map
by  Neel-Schaffer, Inc./Brown & Butler, dated June 13, 2000, revised thru xxxxx,
2002  and  titled  "Map  Showing  Parcels  1,2, 3 & 4, Being a Portion of Borden
Chemical  and  Plastics  Property,  Located  In  Section 11, T10S-R2E, Ascension
Parish,  Louisiana."































                                                                       EXHIBIT B
                                    UTILITIES




















































































                                                                       EXHIBIT C

                          OPERATING AGREEMENT AND LEASE



















































































                                                                       EXHIBIT D

                   GEISMAR ENVIRONMENTAL ALLOCATION AGREEMENT




















































































                                                                       EXHIBIT E

                        ENVIRONMENTAL SERVITUDE AGREEMENT






















































































                                                                       EXHIBIT F

                      LOCATION OF BCI FORMALDEHYDE PIPELINE
                                  July 3, 2002

                          METES AND BOUNDS DESCRIPTION
                         OF THE CENTERLINE OF A PROPOSED
                 4" FORMALDEHYDE PIPELINE ACROSS THE PROPERTY OF
                          BORDEN CHEMICALS & PLASTICS,
                             LOCATED IN SECTION 11,
                        TOWNSHIP 10 SOUTH - RANGE 2 EAST,
                           ASCENSION PARISH, LOUISIANA


The  centerline  of  a  proposed 4" Formaldehyde pipeline across the property of
Borden  Chemicals and Plastics, located in Section 11, Township 10 South - Range
2  East,  Ascension  Parish, Louisiana, and being more particularly described as
follows:
FIRST:
------
     From  a  POINT  OF  REFERENCE  being  a  concrete  monument  located at the
intersection  of  the northerly right of way line of "E" Avenue and the westerly
right of way line of 40th Street at Plant Grid Coordinates N 1084.01 - E 3956.00
proceed  along  the  westerly  right  of way line of 40th Street N 47 16'00" W a
distance  of 1,975.95' to a point and corner at Plant Grid Coordinates N 3059.96
-  E  3956;  thence  proceed S 42 44'00" W a distance of 221.36' to the POINT OF
BEGINNING  at  Plant  Grid  Coordinates  N  3059.96  -  E  3734.64;
     From  said  POINT OF BEGINNING, thence proceed N 42 44'00'' E a distance of
22.93'  to  a  point and corner at Plant Grid Coordinates N 3059.96 - E 3757.57;
     thence  proceed S 47 16'00'' E a distance of 6.94' to a point and corner at
Plant  Grid  Coordinates  N  3053.03  -  E  3757.57;
thence  proceed  N  42  44'00''  E a distance of 10.36' to a point and corner at
Plant  Grid  Coordinates  N  3053.03  -  E  3767.93;
thence proceed N 47 16'00'' W a distance of 6.94' to a point and corner at Plant
Grid  Coordinates  N  3059.96  -  E  3767.93


















































     thence proceed N 42 44'00'' E a distance of 45.89' to a point and corner at
Plant  Grid  Coordinates  N  3059.96  -  E  3813.82;
thence proceed S 47 16'00'' E a distance of 6.01' to a point and corner at Plant
Grid  Coordinates  N  3053.96  -  E  3813.82;
thence  proceed  N  42  44'00''  E a distance of 13.21' to a point and corner at
Plant  Grid  Coordinates  N  3053.96  -  E  3827.03;
thence  proceed  N  02  16'00''  W a distance of 26.98' to a point and corner at
Plant  Grid  Coordinates  N  3073.04  -  E  3846.11;
thence  proceed  N  42  44'00''  E a distance of 13.96' to a point and corner at
Plant  Grid  Coordinates  N  3073.04  -  E  3860.08;
thence proceed N 47 16'00'' W a distance of 3.67' to a point and corner at Plant
Grid  Coordinates  N  3076.71  -  E  3860.08;
thence  proceed  N  42  44'00''  E a distance of 84.93' to a point and corner at
Plant  Grid  Coordinates  N  3076.71  -  E  3945.01;
thence proceed S 47 16'00'' E a distance of 2.05' to a point and corner at Plant
Grid  Coordinates  N  3074.65  -  E  3945.01;
thence  proceed  N  42  44'00''  E a distance of 16.33' to a point and corner at
Plant  Grid  Coordinates  N  3074.65  -  E  3961.34;
thence  proceed  S  47  16'00'' E a distance of 100.91' to a point and corner at
Plant  Grid  Coordinates  N  2973.74  -  E  3961.34;
thence proceed S 42 44'00'' W a distance of 1.55' to a point and corner at Plant
Grid  Coordinates  N  2973.74  -  E  3959.79;
thence  proceed  S  47  16'00'' E a distance of 204.30' to a point and corner at
Plant  Grid  Coordinates  N  2769.44  -  E  3959.79;
thence proceed N 42 44'00'' E a distance of 7.24' to a point and corner at Plant
Grid  Coordinates  N  2769.44  -  E  3967.03;





























































     thence  proceed S 47 16'00'' E a distance of 8.52' to a point and corner at
Plant  Grid  Coordinates  N  2760.93  -  E  3967.03;
thence proceed S 42 44'00'' W a distance of 7.24' to a point and corner at Plant
Grid  Coordinates  N  2760.93  -  E  3959.79;
thence  proceed  S  47  16'00'' E a distance of 380.34' to a point and corner at
Plant  Grid  Coordinates  N  2380.58  -  E  3959.79;
thence proceed N 42 44'00'' E a distance of 7.15' to a point and corner at Plant
Grid  Coordinates  N  2380.58  -  E  3966.94;
thence proceed S 47 16'00'' E a distance of 8.49' to a point and corner at Plant
Grid  Coordinates  N2372.09  -  E  3966.94;
thence proceed S 42 44'00'' W a distance of 7.15' to a point and corner at Plant
Grid  Coordinates  N  2372.09  -  E  3959.79;
thence  proceed  S  47  16'00''  E a distance of 43.26' to a point and corner at
Plant  Grid  Coordinates  N  2328.83  -  E  3959.79;
thence proceed N 42 44'00'' E a distance of 6.82' to a point and corner at Plant
Grid  Coordinates  N  2328.83  -  E  3966.61
thence  proceed  S  47  16'00''  E a distance of 87.08' to a point and corner at
Plant  Grid  Coordinates  N  2241.74  -  E  3966.61;
thence proceed S 42 44'00'' W a distance of 4.40' to a point and corner at Plant
Grid  Coordinates  N  2241.74  -  E  3962.21;
thence  proceed  S  47  16'00'' E a distance of 145.35' to a point and corner at
Plant  Grid  Coordinates  N  2096.39  -  E  3962.21;
thence  proceed  N  87  44'00''  E a distance of 14.30' to a point and corner at
Plant  Grid  Coordinates  N  2086.28  -  E  3972.32;
thence  proceed  S  47  16'00''  E a distance of 77.15' to a point and corner at
Plant  Grid  Coordinates  N  2009.14  -  E  3972.32;





























































     thence proceed S 02 16'00'' E a distance of 15.47' to a point and corner at
Plant  Grid  Coordinates  N  1998.20  -  E  3961.38;
thence  proceed  S  47  16'00''  E a distance of 87.19' to a point and corner at
Plant  Grid  Coordinates  N1911.01  -  E  3961.38;
thence proceed S 42 44'00'' W a distance of 6.20' to a point and corner at Plant
Grid  Coordinates  N  1911.00  -  E  3955.19;
thence  proceed S 47 16'00'' E a distance of 61.00' to a point and corner on the
Property  Line  between Borden Chemicals and Plastics and Uniroyal Chemicals Co.
Inc.  at  Plant  Grid  Coordinates  N  1850.00  -  E  3955.19;
SECOND:
-------
     From  a  POINT  OF  REFERENCE  being  a  concrete  monument  located at the
intersection  of  the northerly right of way line of "E" Avenue and the westerly
right of way line of 40th Street at Plant Grid Coordinates N 1084.01 - E 3956.00
proceed  along  the  westerly  right  of way line of 40th Street N 47 16'00" W a
distance  of  677.07'  to  the  POINT  OF  BEGINNING at Plant Grid Coordinates N
1761.08  -  E  3956;
     From  said  POINT  OF  BEGINNING,
thence proceed N 42 44'00'' E a distance of 7.36' to a point and corner at Plant
Grid  Coordinates  N  1761.08  -  E  3963.36;
thence  proceed  S  47  16'00''  E a distance of 39.87' to a point and corner at
Plant  Grid  Coordinates  N  1721.20  -  E  3963.36;
thence proceed N 42 44'00'' E a distance of 6.48' to a point and corner at Plant
Grid  Coordinates  N  1721.20  -  E  3969.84;
thence  proceed  S  47  16'00'' E a distance of 116.51' to a point and corner at
Plant  Grid  Coordinates  N  1604.69  -  E  3969.84;
thence proceed S 42 44'00'' W a distance of 6.17' to a point and corner at Plant
Grid  Coordinates  N  1604.69  -  E  3963.67;































































     thence proceed S 47 16'00'' E a distance of 23.06' to a point and corner at
Plant  Grid  Coordinates  N  1581.63  -  E  3963.67;
thence proceed N 42 44'00'' E a distance of 6.17' to a point and corner at Plant
Grid  Coordinates  N  1581.63  -  E  3969.84
thence  proceed  S  47  16'00'' E a distance of 317.18' to a point and corner at
Plant  Grid  Coordinates  N  1264.45  -  E  3969.84
thence proceed S 42 44'00'' W a distance of 6.42' to a point and corner at Plant
Grid  Coordinates  N  1264.45  -  E  3963.42;
thence  proceed  S  47  16'00''  E a distance of 22.65' to a point and corner at
Plant  Grid  Coordinates  N1241.81  -  E  3963.42;
thence proceed N 42 44'00'' E a distance of 6.42' to a point and corner at Plant
Grid  Coordinates  N  1241.81  -  E  3969.84;
thence proceed S 47 16'00'' E a distance of 131.81' to a point and corner on the
property  line  between  Borden Chemicals and Plastics and Uniroyal Chemical Co.
Inc.at  Plant  Grid  Coordinates  N  1110.00  -  E  3969.84

The  above  description  based  on  drawings  provided  the  Surveyor  by  R & D
Consulting,  Inc.  and  titled  "Offsites 4" Formaldehyde Line to BASF - Plan of
Pipeline  Centerline".  Drawing  Number  SK-6672-01  through  Drawing  Number
SK-6672-04,  dated  June  2002.




     Gerald  W.  Middleton,  Jr.,  P.L.S.
 LA  Reg.  No.  4856



























































                                                           EXHIBIT  G

                              SETTLEMENT AGREEMENT




















































































                                                                 SCHEDULE 2.1(d)

                    PERMITTED LIENS ON BCP EXCHANGE PROPERTY

Liens arising under of in connection with the Reciprocal Servitude Agreement and
Assignment  of Servitudes, dated July 28, 2000, between BCI and BCP, as amended.



















































































                                                                 SCHEDULE 2.2(d)

                    PERMITTED LIENS ON BCI EXCHANGE PROPERTY

Liens arising under or in connection with the Reciprocal Servitude Agreement and
Assignment  of Servitudes, dated July 28, 2000, between BCI and BCP, as amended.















































































                                                                    SCHEDULE 3.2

                  METHANOL MAINTENANCE SHOP TOOLS AND EQUIPMENT
One  overhead  five  ton  bridge  crane  currently  installed  in  the  methanol
maintenance  shop.


















































































                                                  SCHEDULE  3.10
                      TERMS OF EACH CONVEYANCE INSTRUMENTS

This exchange of property or conveyance of property, as the case may be, is made
and  accepted  (i) without any warranty as to title except against the act(s) of
each  transferor, but with substitution and subrogation in and to all the rights
and  actions  of  warranty  which  each  transferor  has or may have against all
preceding  owners and vendors, and (ii) each conveyance is made and accepted "AS
IS,  WHERE  IS"  without  any warranties of any kind whatsoever as to the use or
condition  of  the property transferred or any of the component parts thereof or
the  absence  of apparent or hidden defects in such property, including, without
limitation,  the  environmental  condition  of  such  property.  Each transferee
hereby  waives  (i)  the warranty against hidden defects or redhibitory vices in
the  property  acquired otherwise imposed by Article 2475 of the Louisiana Civil
Code  or  other  applicable  law,  and  (ii) any rights it may otherwise have in
redhibition  pursuant  to Articles 2530 through 2548 of the Louisiana Civil Code
or  other  applicable  law, and release the transferor of such property from any
liability  which  may  otherwise  arise  out  of  such  warranty  and  rights in
connection with the conveyance of such property.  Each party hereto declares and
acknowledges  that  such  waivers and release of liability constitute a material
part  of  the  consideration  for  the exchange of property hereunder, that such
waivers  and  release  of  liability  and  the  legal  effect  thereof have been
explained  in  detail,  and that each party has voluntarily and knowingly agreed
thereto.  Each  party  hereby  acknowledges  and  confirms that it has had ample
opportunity  to inspect fully the property acquired, has inspected such property
to the extent the transferee desires, is purchasing such property in its present
condition  "AS  IS  -  WHERE  IS"  with  all  defects, and does hereby waive and
relinquish,  to  the fullest extent permitted by law, any and all rights to void
the  exchange  or  to claim damages or the return of the property transferred by
the  complainant on account of any latent, hidden, or apparent vice or defect in
the  property  acquired.























































                           PRIOR ANCILLARY AGREEMENTS

A.     January  26,  2000  Agreement  to Sell and Purchase with respect to BCI's
acquisition  of  land  from BCP in or near Ascension Parish, Geismar, Louisiana.

B.           January 26, 2000 Act of Cash Sale by BCP to BCI with respect to the
BCI's  acquisition  of  land  from the BCP in or near Ascension Parish, Geismar,
Louisiana.

C.     January  26,  2000 Environmental Indemnity Agreement between BCI and BCP.

D.     January  26,  2000  Indemnity  with Respect to Liens between BCI and BCP.
E.     January  26,  2000  Ticor Title Insurance affidavit of title of BCP.

F.     On  June  27, 2000 Conveyance and Transfer Agreement between BCI and  BCP
with  respect  to  BCI's  acquisition  of  additional  land  from BCP at or near
Geismar,  Ascension  Parish,  Louisiana,  including  BCP's existing formaldehyde
plants,  dock  and  tankage.

G.     July  28, 2000 Act of Cash Sale between BCI and BCP with respect to BCI's
acquisition  of  additional  land from BCP at or near Geismar, Ascension Parish,
Louisiana,  including  BCP's  existing  formaldehyde  plants,  dock and tankage.
H.     July  28,  2000  Utilities  and  Services  Agreement between BCI and BCP.
I.     July  28,  2000  Barge  Dock  Agreement  between  BCI  and  BCP.
J.     July  28,  2000  Ground  Lease  between  BCI  and  BCP.

K.     July 28, 2000 Reciprocal Servitude Agreement and Assignment of Servitudes
between  BCI  and  BCP.

L.     July  28,  2000  Environmental  Indemnity  Agreement between BCI and BCP.

M     July  28,  2000  Control  Room  Agreement  between  BCI  and  BCP.
N.     July  28,  2000  Act of Declaration of Separate Ownership between BCI and
BCP.

O.     July 28, 2000 Amendment to Intercompany Agreement among the
BCP, Borden Chemical and Plastics Limited Partnership, Borden, Inc., BCI and BCP
Management,  Inc.

P.     July  28,  2000  Mutual Release and Termination Agreement between BCI and
BCP.

Q.     July  28,  2000 Assignment and Assumption Agreement between
BCI  and  BCP.
R.            July  28,  2000  Bill  of  Sale  delivered  by  BCP  to  BCI.
S.            July 28, 2000 Bill of Sale (Pipelines) delivered
by  BCP  to  BCI.

T     Mutual Aid Agreement dated October 31, 2000 between the
BCI  and  BCP.





































                                                     Exhibit  (xxvii)

                        ENVIRONMENTAL SERVITUDE AGREEMENT


     THIS ENVIRONMENTAL SERVITUDE AGREEMENT ("Agreement") dated as of the 20 day
of  December,  2002,  by  and  between  Borden  Chemicals and Plastics Operating
Limited  Partnership,  a  Delaware  limited  partnership  ("BCP"),  and  Borden
Chemical,  Inc.,  a  New  Jersey  corporation  ("BCI").

                                    ARTICLE 1

                             PRELIMINARY STATEMENTS
                             ----------------------


1.1     BCP  owns  that  certain  real  property  located  in  Ascension Parish,
Louisiana  (the  "BCP Site") as described as Parcels 3-B, 5, 6 and 7 on the "Map
Showing  Resubdivision  of  Parcel  3  and  the Remainder of Borden Chemical and
Plastics  Property  into Parcels 3-A, 3-B, 5, 6, & 7 Located in Section 49 & 50,
T-9-S, R-2-E, and Sec. 3 & 11, T-10-S, R-2-E, Ascension Parish, Louisiana" drawn
by  Neel-Schaffer,  Inc.,  Brown & Butler Engineers, Planners, and dated July 6,
2000,  revised July 20, 2000, July 25, 2000, July 27, 2000, July 31, 2000, March
15,  2002,  July  17,  2002,  July  18,  2002, August 10, 2002, August 20, 2002,
October  31,  2002, November 5, 2002 and December 4, 2002, which map is recorded
with  the  Clerk of Court and Recorder of Mortgages for the Parish of Ascension,
State  of  Louisiana  as  Entry  #  531263.

1.2     On  June  11,  1998,  in  United States v. Borden Chemicals and Plastics
                                  ----------------------------------------------
Operating  Limited  Partnership,  No.  94-2592-A-M2,  the United States District
    ---------------------------
Court  for  the  Middle  District  of  Louisiana  entered  a consent decree (the
"Consent  Decree")  between  BCP,  the United States and the State of Louisiana.

1.3     The  Consent  Decree  requires  BCP to implement at the BCP Site certain
"Interim  Measures,"  including  but  not  limited  to:

1.3.1     The  operation  of  a shallow groundwater recharge and recovery system
(the  "Groundwater  Recovery System"), including but not limited to the five (5)
recovery  trenches  and  seven  (7)  extraction  wells  identified on Exhibit A,
attached  hereto  and  made  a  part  hereof, and the groundwater recharge units
("GRUs")  depicted  upon  Exhibit  A.

1.3.2     Operation  of  a  Norco Aquifer Monitoring and Containment System (the
"Norco System") consisting of a system of extraction and monitoring wells in the
locations  on  the  BCP  Site  identified  on  Exhibit  A.

1.3.3     Construction  and operation of an "S" Zone Groundwater Recovery System
(the  "S Zone System") consisting of one or more vertical or horizontal wells or
an  alternate  system  approved  by  the  Louisiana  Department of Environmental
Quality  ("LDEQ")  and  United  States  Environmental Protection Agency ("EPA").

1.3.4     Remediation of mercury contaminated soils at a portion of the BCP Site
in  the  general  area  depicted  on  Exhibit  A.

1.3.5     A  Remediation  Investigation  ("RI") and a Remediation Measures Study
("RMS")  at  a  portion  of  the  BCP  Site  and  the performance of appropriate
investigation  and  remediation  measures  required or approved by LDEQ and EPA.

1.4     As  of  the date even herewith BCI and BCP entered into an Environmental
Allocation  Agreement  (the  "Environmental  Allocation  Agreement") whereby BCI
agreed  to  (i)  perform  certain  of BCP's obligations for the Interim Measures
under the Consent Decree and (ii) investigate and remediate any contamination of
soil or groundwater, existing prior to the date hereof, at or emanating from any
solid  waste management unit ("SWMU") at the BCP Site identified in Attachment A
to  the  Consent  Decree.

1.5     The  parties  desire  to  enter  into  this Agreement for the purpose of
establishing  the  rights  and obligations of BCI with respect to the use of the
BCP  Site for performance of its obligations, under the Environmental Allocation
Agreement.  The  parties  also  desire to enter into this Agreement to set forth
the  rights  of  BCP  and  any  subsequent  owners  of  the  BCP  Site.

1.6     Wherever  this Agreement refers to a subsequent owner of the BCP Site or
to a sale of the BCP Site, such reference shall include any subsequent owners of
all  or  a  portion of the BCP Site and/or any sale of all or any portion of the
BCP  Site.

NOW THEREFORE, in consideration of the mutual covenants and conditions contained
herein,  and  for  other  good  and  valuable  consideration,  the  receipt  and
sufficiency  of  which  are  hereby  acknowledged, BCP and BCI agree as follows:




                                    ARTICLE 2

                                   SERVITUDES
                                   ----------

2.1     General  Access  Servitude.  BCP  hereby  grants  to  BCI  a
        --------------------------
servitudeoverservitude over, upon, across, and above the BCP Site for ingress to
        -----------
and  egress  from,  and  use  of,  the BCP Site as BCI may reasonably require to
perform  its  obligations  underobligations  under  the Environmental Allocation
Agreement.  To  the  extent  access  to  the BCP Site is required by EPA or LDEQ
under  Paragraph  67  of  the  Consent  Decree  for  any purpose relating to the
implementation,  monitoring or enforcement of the Consent Decree, such servitude
of  access  shall  extend  also  to  the  EPA or LDEQ and their representatives,
including  contractors.

2.2     Groundwater  Recovery  System. BCP grants to BCI a servitude to operate,
        -----------------------------
construct,  build,  replace, repair and maintain the Groundwater Recovery System
at  or  upon the BCP Site, provided, however, that BCI will bear the risk of all
existing  site  conditions, including but not limited to, the possible existence
of  underground  facilities.

2.3     Norco  System.  BCP  grants  to  BCI  a servitude to operate, construct,
        -------------
build,  replace,  repair  and maintain the Norco System at or upon the BCP Site.

2.4     S  Zone  System.  BCP  grants  to BCI a servitude to operate, construct,
        ---------------
build,  replace,  repair and maintain the S Zone System at or upon the BCP Site.

2.5     RI  /  RMS  / SWMUs. BCP grants to BCI a servitude to perform the RI and
        -------------------
RMS  at  or upon the BCP Site and to conduct an investigation of the soils and /
or  groundwater  at  or  emanating  from  any  SWMU  on  the  BCP  Site.

2.6     Remediation.  BCP grants to BCI a servitude to conduct upon the BCP Site
        -----------
such  remediation of soil and groundwater as is necessary for BCI to perform its
obligations  under  the  Environmental  Allocation Agreement, including, but not
limited  to, excavation of soils, management or treatment of soils, installation
of  extraction  and/or  monitoring  wells, sampling of soils and/or groundwater,
extraction  of  groundwater,  treatment  of  groundwater  and  installation  and
maintenance  of covers, caps or barriers, provided, however, that BCI shall take
all reasonable steps to minimize any disruption of or material adverse impact on
the  operations  conducted  by  BCP  and  any  subsequent owner of the BCP Site.

2.7     Utilities. BCI shall have the  rightthe right and servitude to transport
        ---------
across  the  BCP  Site  such  utilities  as  are necessary  fornecessary for the
operation  of  the  Groundwater Recovery System, Norco System and S Zone System,
including but not limited to water, air, telephone, electricity, steam, nitrogen
and  natural  gas,  and  for  such  purpose  shall have the right to utilize the
existing  utility  lines  which  service  the Groundwater Recovery System, Norco
System  and  S  Zone  System,  and  the  right  to make repairs, replacements or
improvements  to  such utility lines and the right to install additional utility
lines  for  this  purpose,  provided,  however,  that  the  location of any such
additional  utility  lines  shall  be  subject  to  prior approval by BCP or any
subsequent owner of the BCP Site, which shall not be unreasonably conditioned or
withheld.

2.8     Relocation.  To the extent it is necessary for BCI  toBCI to perform its
        ----------
obligations  under  the  Environmental  Allocation Agreement, BCI shall have the
right  to  relocate  or  expand any elements of the Groundwater Recovery System,
Norco System and S Zone System, to additional or alternative portions of the BCP
Site;  provided,  however,  such  relocation  or  expansion shall be designed to
minimize  any  disruption of or material adverse impact on the BCP operations or
any  operations  conducted  by a subsequent owner of the BCP Site; and provided,
further,  that  such relocation shall be subject to prior approval by BCP or any
subsequent  owner  of  the  BCP  Site,  which approval shall not be unreasonably
withheld  or  conditioned.

2.9     General Conditions Governing Servitudes.  All of the rights of servitude
        ----------------------------------------
granted  above shall be subject to the following limitations:  (i) Except in the
case  of  emergency the rights of access to the BCP Site shall be exercised only
at  reasonable  times,  consistent  with established or customary practices, and
persons exercising rights of access to the BCP Site shall comply with all safety
and  security  procedures,  practices and requirements of BCP and any subsequent
owner  of  the  BCP  Site  (ii)  the  rights  of  servitude granted above may be
exercised  by employees, agents, contractors, subcontractors, invitees and other
persons  under  BCI's control and direction, but BCI shall remain liable for any
damages  caused by such persons, and (iii) any work at the BCP Site by BCI shall
be  performed  in  compliance  with  applicable laws and permits and, unless the
manner  of  performing the work is otherwise directed by the LDEQ or EPA, normal
engineering  practices.

                                    ARTICLE 3

                                COVENANTS OF BCP
                                ----------------

3.1     Interference  and  Designation of Access to and Use of the BCP Site. The
        -------------------------------------------------------------------
exercise  of  the  servitudes  herein  granted  shall  be undertaken by BCI in a
reasonable  manner  which minimizes any disruption of or material adverse impact
on  anyon  any  operations being conducted by BCP or any subsequent owner of the
BCP Site.  No owner of the BCP Site shall, at any time, engage in any activities
which  unreasonably  interfere with or obstruct BCI's exercise of the servitudes
herein  granted.  To  the  extent  practical  and in order to give effect to the
foregoing  sentences,  prior  to BCI's exercise of its rights hereunder and from
time to time thereafter, BCI and BCP or  anyor any subsequent owner or owners of
the  BCP  Site  will  meet  and  negotiate in good faith to establish the means,
methods  and  procedures  that  are  reasonably  required by all parties for the
exercise of their respective rights hereunder.  In addition, certain uses of the
BCP Site require the consent of the owner or owners of the BCP Site, as provided
in  Section  4.4,  below

3.2     Sensitive Areas.  BCP understands that certain areas within the BCP Site
        ---------------
have  been  designated as Sensitive Areas on Exhibit C [such Sensitive Areas are
the  woodlined ditch, withdraw trenches, slurry wall around back wash ponds, the
GRUs  and the street, parking area and VCM Plant Area 1 (direct chlorination and
EDC  distillation  area) north and east of the VCM-E control room].  BCP further
understands  that  those  Sensitive  Areas  may  be  subject of investigation or
remediation  by  BCI  pursuant  to  the Environmental Allocation Agreement.  BCP
agrees,  on  behalf  of itself and any subsequent owner of the BCP Site, that it
will (i) provide BCI with advance notice of any major construction projects that
BCP  or  any  subsequent  owner  may  undertake  in those  designated "Sensitive
Areas",  ,  which notice BCI shall treat as confidential information,  (ii)  not
undertake  major  construction  projects  within the Sensitive Areas without the
prior  written  consent  of  BCI,  which  consent  shall  not  be  unreasonably
conditioned  or  withheld  and (iii) consult with BCI in advance with respect to
major construction projects to be undertaken in areas of the BCP Site other than
within  the  Sensitive  Areas  in  order  to minimize the impact that such major
construction  projects may have on BCI's implementation of its obligations under
the  Environmental  Allocation  Agreement.

3.3     Releases.  BCP,  or  any subsequent owner of the BCP Site, will give BCI
        --------
written notice of any reportable releases at the BCP Site at the same time as it
submits  notice  to  applicable  governmental  authorities.

3.4     Deed  Restrictions.  If requested by BCI, BCP or any subsequent owner of
        ------------------
the  BCP Site will execute deed restrictions that would limit the use of the BCP
Site  to  comparable  industrial  purposes,  except  for  any  area approved for
non-industrial  uses  by  the  EPA  and  the LDEQ surrounding the Administration
Buildingexcept  for  any  area  surrounding  the  Administration  Building where
industrial  use  is  not  required  by  EPA  and  LDEQ.


                                    ARTICLE 4

                                COVENANTS OF BCI
                                ----------------

4.1     Compliance  With  Laws.  All  activities hereunder shall be performed by
        ----------------------
BCI  in  compliance with all applicable requirements of all applicable laws.  To
the  extent approved by the EPA or LDEQ, or any other governmental entity having
jurisdiction,  BCI  shall  be  entitled  to  base its compliance with applicable
requirements  governing clean-up standards by reference to  risk-based standards
for  comparable  industrial  sites.

4.2     Damages Occurring on or to the BCP Site.  BCI will repair or replace any
        ---------------------------------------
damage  or injury on or to the BCP Site or to any improvements thereon,  and BCI
will  be  responsible for any damages to person or other property resulting from
BCI's  exercising  its  rights  under  this  Environmental  Servitude Agreement.

4.3     Closure.  At  the  end  of  the  term  of  this  Environmental Servitude
        -------
Agreement, BCI will remove all equipment operated by it hereunder to slab level,
plug  and abandon any wells according to the requirements of applicable laws and
regulations  then  in  effect  and perform such other closures of the facilities
operated  by  it hereunder that are required  by applicable laws and regulations
then  in  effect.

4.4     Coordination.  BCI  shall  provide  BCP  and any subsequent owner of any
        ------------
affected  portion of the BCP Sitewith prior notice of and opportunity to comment
on  any  material  plans  being  submitted, material meetings or phone calls for
negotiations being conducted, or material work being implemented pursuant to the
Environmental  Allocation Agreement, and BCP and any such subsequent owner shall
have the right, but not the obligation, to participate at its own expense in any
such  meetings or phone calls.  BCI will provide BCP, or any subsequent owner of
the  BCP  Site,  with  a copy of any proposed work plan for any investigation or
remediation activities it proposes to conduct on the BCP Site in sufficient time
for  BCP,  or such subsequent owner, to prepare and submit comments to BCI prior
to  submission to governmental authorities.  BCI shall be solely responsible for
the  proper design, construction or completion of any such work. If any proposed
investigation  or  remediation  activities  outside  the  Sensitive  Areas would
materially  and  adversely  affect  BCP's  operations, or any subsequent owner's
operations  on  the  BCP  Site, consent to such action must first be obtained by
BCI,  provided, however, that such consent shall not unreasonably be conditioned
or  withheld.  BCI  shall  conduct  its  activities  hereunder  so  as  not  to
unreasonably  interfere with or obstruct the use or development of the BCP Site.

4.5     Insurance.
        ---------

4.5.1     BCI  shall  provide  and  maintain:
(i)     Worker's  Compensation  Insurance  at Statutory limits under the laws of
the  state  of  Louisiana, and Employer's Liability Insurance with limits of not
less  than  $1,000,000,  and
(ii)     Comprehensive  General  Liability  Insurance  with  bodily  injury  and
property coverage  limits of not less than $10,000,000 combined single limit per
occurrence

4.5.2     The  insurance to be provided pursuant to this Section may be provided
pursuant  to  blanket  insurance  policies  or  may  be  self-insured; provided,
however,  in  no event shall the protection afforded by such blanket policies or
self  insurance be less than otherwise required hereunder; provided further that
if  BCI  retains  any  part  of  the  risks  to  be insured in this Section as a
self-insurer or under such blanket policies BCI shall have the same liability as
an  insurer  would  have  to  the extent, if any, that such retention results in
insurance  for  less  than  the  full  amounts  required  in  this  Section.

4.5.3     Certificates  of  insurance evidencing the coverage required hereunder
shall be delivered to BCP and replacement certificates shall be delivered within
ten (10) days prior to the expiration of any of the insurance policies evidenced
by  such  certificates.

4.5.4     BCP and any future owner of any affected portion of the BCP Site shall
be  named  an  additional  insured  on  all  such policies of insurance as their
interests  may  appear.

4.6     Taxes.  BCI  shall  pay all taxes, assessments, levies, charges, similar
        -----
impositions,  imposed by any authority having direct power to tax, including any
city,  parish,  state  or  federal government, as against any legal or equitable
interest  of  BCI  in  any  fixtures,  equipment or improvements operated by BCI
hereunder, but not any taxes, assessments, levies, charges, similar impositions,
imposed  with  respect to the land or immovables comprising the BCP Site, or any
of  BCP's  federal, state or local income or franchise taxes, all of which shall
be  paid  by  BCP.

                                    ARTICLE 5
                                    ---------

                                      TERM
                                      ----

5.1     Term. The term of this Agreement and the servitudes hereby created shall
        ----
commence  on  the date hereof and extend until BCI has completed the performance
of  the  last  of  its obligations under the Environmental Allocation Agreement.

5.2     Failure  To  Perform.  The  parties  hereby  agree that, notwithstanding
        --------------------
anything  contained  herein to the contrary, the failure, or alleged failure, of
either  party  to  perform any or all of its respective obligations under, or to
observe  any  of  its  covenants  or  agreements  contained  in,  this  grant of
servitudes  shall  never serve or be used or claimed as a ground for claiming or
declaring that the servitudes herein granted, or any of them, have terminated or
are terminable by either party, it being understood and agreed that none of such
obligations,  covenants  or  agreements  is a condition to the continued use and
enjoyment  of  such  servitudes  in  accordance herewith and that any losses and
damages  suffered  by  either  party arising out of such breach of or failure to
observe  any  or  all of such obligations, covenants and agreement shall entitle
the  injured  party  to all available remedies, except the remedy of terminating
said  servitudes,  in  whole  or  in  part,  which  remedy  is hereby waived and
released.






                                    ARTICLE 6
                                    ---------

                                  MISCELLANEOUS
                                  -------------

6.1     Successor  and Assigns. Each and all of the provisions contained in this
        ----------------------
Agreement  (i)  will  create  servitudes upon the BCP Site and will be covenants
running  with  the  land;  and  (ii)  will  bind  every  person  having any fee,
leasehold,  or  other interest in any portion of the BCP Site to the extent that
such  portion  is affected by any term, covenant, or provision set forth in this
Agreement.

6.2     Further  Assurances.  The  parties  agree that, upon reasonable request,
        -------------------
they will do such further acts and deeds, and will execute, acknowledge, deliver
and  record  such other document and instruments, as may be reasonably necessary
from  time  to time to evidence, confirm or carry out the intent and purposes of
this  Agreement and to otherwise confer upon the parties full enjoyment of their
respective  rights  hereunder.

6.3     Interpretation. The parties agree that each party and its attorneys have
        --------------
reviewed and revised this Agreement and that the normal rule of construction, to
the  effect  that  any ambiguities are resolved against the drafting party, will
not  be  employed  in  the  interpretation  of  this  Agreement.

6.4     Applicable Law. This Agreement will be governed by, construed under, and
        --------------
enforced  in  accordance  with the laws of the State of Louisiana, excluding the
conflicts-of-law  provisions  hereof.

6.5     Section Headings. Section and other headings contained in this Agreement
        ----------------
are  for  reference  purposes only and will not in any way affect the meaning or
interpretation  of  this  Agreement.

6.6     Notice.  Any  notice  or other communication permitted or required to be
        ------
given  or  made by any Party to the other Party hereunder must be in writing and
may  be  given  by  hand delivery, overnight express mail, telecopy transmission
(with  written  confirmation  of delivery), or certified or registered U.S. mail
(with  postage paid and return receipt requested). Notices will be deemed given,
in the case of (i) by hand delivery or telecopy transmission, upon receipt, (ii)
overnight  or  express mail, on the next business day after timely delivery to a
recognized  overnight  delivery  service,  and  (iii)  U.S. mail, upon the third
business day after deposit with the U.S. postal service. For purposes of notice,
the addresses and telecopy numbers of the parties will, until names or addresses
are  changed  by  delivery  of  a  notice  hereunder,  be  set  forth  below:

     If  to     Borden  Chemical,  Inc.:
     180  East  Broad  Street
     Columbus,  Ohio  43215
     Attention:  General  Counsel
     Telecopy:  614-627-8374

If  to     BCP
     c/o  BCP  Management,  Inc.
Vorys,  Sater,  Seymour  and  Pease,  LLP
52  East  Gay  Street
Columbus,  OH  43216
Attention:  Joseph  D.  Lonardo
Telecopy:  (614)464-6530

With  a  copy  to:
     Lemle  &  Kelleher
     601  Poydras  Street,  21st  Floor
     New  Orleans,  LA  70130
     Attention:  Mr.  E.  L.  Edwards
     Telecopy:  (504)584-9142

and

Jones,  Day,  Reavis  &  Pogue
3500  SunTrust  Plaza
303  Peachtree  Street,  N.E.
Atlanta,  Georgia  30308-3242
     Attn:  Mr.  Neil  P.  Olack

6.7     No  Waiver.  The  failure  by  any  party  to  enforce any of its rights
        ----------
hereunder  will not be deemed to be a waiver of such rights, unless waiver is an
express  written  waiver  signed  by the waiving party. Waiver of any one breach
will  not  be deemed to be a waiver of any other breach of the same or any other
provision  hereof.

6.8     Severability.  If any provision of this Agreement is held to be illegal,
        ------------
invalid,  or  unenforceable  under  present  or future applicable law, or by any
court,  agency  or  other  governmental  authority, such provision will be fully
severable  and this Agreement will be construed and enforced as if such illegal,
invalid  or  unenforceable  provision had never comprised a part hereof, and the
remaining  provisions of this Agreement will remain in full force and effect and
will  not  be affected by the illegal, invalid, or unenforceable provision or by
its  severance  form  this Agreement. Furthermore, in lieu of each such illegal,
invalid, or unenforceable provision there will be added automatically as part of
this  Agreement a provision as similar in terms to such severed provision as may
be possible, such that this Agreement, with such added provision, will be legal,
valid,  and  enforceable  in  accordance  with  applicable  law.

6.9     Counterparts.  This  Agreement  may  be  executed  in  one  or  more
        ------------
counterparts,  all  of  which  will  be  deemed  to  be  an  original.
        ----

6.10     Implied  Consent. Wherever in this Agreement the consent or approval of
         ----------------
a party is required, unless otherwise expressly provided herein, such consent or
approval  will  not  be unreasonably withheld, conditioned or delayed. Except as
otherwise  provided  in the Agreement, if a Party having the right of consent or
approval  hereunder  fails  to give such consent or approval or specific written
grounds for disapproval within the applicable time period (or, if no time period
is provided, within 21 days of receipt of the request therefor), such Party will
be  deemed  to  have  given  its approval or consent. Any request for consent or
approval  will:  (a)  be  in  writing; (b) specify the section hereof which will
require  that  such notice be given or that consent or approval be obtained; (c)
clearly  and  conspicuously  state  that the failure to respond to the notice or
request  within  the  stated  time  period  will be deemed the equivalent of the
recipient's  approval  or consent to the subject matter of the notice or request
for  approval  or  consent; and (d) be accompanied by such background data as is
reasonable  necessary  to  enable  the  recipient  to  make an informed decision
thereon.

6.11     No Joint Venture. This Agreement will not create or be deemed to create
         ----------------
any  partnership, joint venture, or joint enterprise between BCP and BCI, and to
the  extent  such a relationship may be deemed to have been created, BCP and BCI
hereby  expressly disdain such relationship. The only relationship created under
this  Agreement  will  be  that  of  grantor  and  grantee  with  respect to the
servitudes  established  hereunder.

6.12     Assignment.  This Agreement will be binding upon and will insure to the
         ----------
benefit  of  the  respective  Parties  hereto  and  such  parties' successor and
assigns.









































IN  WITNESS  WHEREOF  the  Parties hereto have executed this Agreement as of the
date  written  below.

Signed  by  Borden  Chemicals  and  Plastics  Operating  Limited  Partnership in
Geismar,  Louisiana,  on  ________________,  2002.

WITNESSES  AS  TO  BCP               BORDEN  CHEMCIALS  AND
----------------------
                              PLASTICS  OPERATING  LIMITED
                              PARTNERSHIP
          By  BCP  Management,  Inc.,  General  Partner

_______________________________          By:  _______________________________
                              Name:  _____________________________
_______________________________          Title:  ______________________________


                                 ACKNOWLEDGMENT

STATE  OF  LOUISIANA
PARISH  OF  ASCENSION

     On  this  ____th  day  of  __________,  2002, before me, the undersigned, a
Notary  Public  for  the  aforesaid  Parish,  personally  appeared
_____________________  the  ________________  of  BCP  Management,  Inc., in its
capacity  as  general partner of Borden Chemicals and Plastics Operating Limited
Partnership,  a Delaware limited partnership, known to me to be the person whose
name  is subscribed to the within instrument, and that he executed the foregoing
instrument  in  his authorized capacity as such ______________________ and he is
known  to  me  (or proved to me on the basis of satisfactory evidence) to be the
person who executed the same and acknowledged to me that he executed the same in
his  authorized  capacity.

     WITNESS  my  hand  and  official  seal.

                              __________________________________
                              Notary  Public

                              My  Commission  Expires:  _____________
                              [Notarial  Seal]













































IN  WITNESS  WHEREOF  the  Parties hereto have executed this Agreement as of the
date  written  below.

Signed  by  Borden  Chemical, Inc. in Columbus, Ohio, on ________________, 2002.

WITNESSES  AS  TO  BCI               BORDEN  CHEMCIAL,  INC.
----------------------               -----------------------

___________________----____________
                              By:  _______________________________
                              Name:  _____________________________
_______________________________          Title:  ______________________________
-------------------------------


                                 ACKNOWLEDGMENT

STATE  OF  OHIO
COUNTY  OF  FRANKLIN

     On  this  ____th  day  of  __________,  2002, before me, the undersigned, a
Notary  Public  for  the  aforesaid  County,  personally  appeared
________________________  of  Borden  Chemical,  Inc., a New Jersey corporation,
known  to me to be the person whose name is subscribed to the within instrument,
and that he executed the foregoing instrument in his authorized capacity as such
__________________________ (title) and he is known to me (or proved to me on the
basis  of  satisfactory  evidence)  to  be  the person who executed the same and
acknowledged  to  me  that  he  executed  the  same  in his authorized capacity.

     WITNESS  my  hand  and  official  seal.

                              __________________________________
                              Notary  Public

                              My  Commission  Expires:  _____________
                              [Notarial  Seal]

















































                                                        Exhibit 10(xxviii)

                          UNITED STATES BANKRUPTCY COURT
                          FOR THE DISTRICT OF DELAWARE
_________________________________________
     )
IN  RE:          )
)     JOINTLY  ADMINISTERED
BORDEN  CHEMICALS  AND  PLASTICS     )
OPERATING  LIMITED  PARTNERSHIP     )     CASE  NO.  01-1268  (PJW)
ET  AL.,          )
)     CHAPTER  11
           DEBTORS.     )
_________________________________________     )

                              SETTLEMENT AGREEMENT
                              --------------------

     THIS  SETTLEMENT  AGREEMENT is entered into by and between Borden Chemicals
and  Plastics  Operating  Limited  Partnership  ("BCP"),  a  debtor  and
debtor-in-possession  in  the  above  captioned chapter 11 case; BCP Management,
Inc.  ("BCPM"), the general partner of BCP and a debtor and debtor-in-possession
in  a  separate  chapter 11 case; Borden Chemical, Inc ("BCI")/FORMERLY KNOWN AS
BORDEN, INC.; the United States on behalf of the Environmental Protection Agency
("EPA");  and  the  Louisiana  Department  of  Environmental Quality ("La.DEQ").
WHEREAS,  on  April 3, 2001, BCP filed a petition for relief under chapter 11 of
the  Bankruptcy  Code,  11  U.S.C.    101  et  seq.  (the "Bankruptcy Code") and
                                           --  ---
thereafter  continued  in  the  management  and  operation  of  its business and
properties  pursuant  to  Sections  1107  and  1108  of  the  Bankruptcy  Code;
WHEREAS,  on  October 16, 2001, the United States, on behalf of the EPA, filed a
proof  of  claim  in  the  above-captioned  case  with respect to inter alia the
                                                                  ----- ----
alleged  release  of  hazardous waste into the environment from the BCP property
("Geismar  Property")  located  in  Geismar,  Louisiana  ("Proof of Claim") (see
Exhibit  1  hereto, "Proof of Claim of the United States on behalf of the United
States  Environmental  Protection  Agency"  (dated  October  15,  2001));
WHEREAS,  the  Proof of Claim asserts a claim related to the liability of BCP to
EPA under the Resource Conservation and Recovery Act ("RCRA"), 42 U.S.C.    6921
et  seq.;  the  Comprehensive Environmental Response, Compensation and Liability
--  ---
Act  ("CERCLA"),  42  U.S.C.    9601  et seq.; and the Clean Air Act ("CAA"), 42
--                                    -- ---
U.S.C.    7401  et  seq.;
--              --  ---
WHEREAS, on March 22, 2002, BCPM filed a petition for relief under chapter 11 of
the  Bankruptcy Code and thereafter continued in the management and operation of
its business and properties pursuant to Sections 1107 and 1108 of the Bankruptcy
Code;
WHEREAS,  on  June  11,  1998,  the  United States District Court for the Middle
District  of  Louisiana entered a consent decree between BCP, the United States,
and  the  State  of  Louisiana ("Consent Decree")  (see Exhibit 2 hereto, United
                                                    ---                   ------
States  v.  Borden  Chemicals  and  Plastics  Operating Limited Partnership, No.
   ------------------------------------------------------------------------
94-2592-A-M2  (Consent  Decree,  M.D. La. June 11, 1998)), to which BCI is not a
   --
party;
WHEREAS,  although  certain  obligations  under  the  Consent  Decree  have been
completed,  other  obligations  under the Consent Decree remain to be performed;
WHEREAS,  the  United  States  intended  its  filing of the Proof of Claim to be
protective  in  nature  as  to  BCP's  injunctive  obligations under the Consent
Decree;
WHEREAS,  it  is  the  position  of  the  United  States  that court-ordered and
regulatory  obligations  of  BCP are mandatory injunctive obligations of BCP for
which  proofs  of claim need not be filed under the Bankruptcy Code, but BCP and
BCPM  dispute  this  position;
WHEREAS,  BCP and Borden, Inc. entered into an environmental indemnity agreement
dated  as  of  November  30,  1987 under which each agreed to certain rights and
obligations  with  respect  to  one  another concerning environmental conditions
relating  to the Geismar Property (see Exhibit 3 hereto, Environmental Indemnity
                                  ----
Agreement  between  BCP  and  Borden,  Inc.  (dated  as  of November 30, 1987));
WHEREAS, the parties hereto, without admission of liability by any party, desire
to  settle,  compromise  and  resolve the Proof of Claim and any other proofs of
claim with respect to the Consent Decree that have been filed or could have been
filed  in  the above-captioned case by or on behalf of EPA and La.DEQ, and EPA's
mandatory  injunctive  claim  contained in the Consent Decree, and to facilitate
the  orderly  and  efficient  implementation of the work at the Geismar Property
called  for  by  the  Consent  Decree;
NOW,  THEREFORE,  in  consideration of the mutual promises contained herein, and
for  other  good  and  valuable  consideration  receipt  of  which  is  hereby
acknowledged;
IT  IS  HEREBY  STIPULATED  and agreed to by and between the parties as follows:
     1.  Irrespective  of  the  provisions of Section III of the Consent Decree,
BCI,  BCPM and BCP and their successors and assigns commit to the EPA and La.DEQ
that  they  shall  comply  with  their  respective obligations under the Geismar
Environmental Allocation Agreement, Exhibit D to the Master Asset Conveyance and
Facility  Support Agreement, which agreement  (including Exhibit D and the other
exhibits  thereto)  is  Exhibit  4  hereto.
     2.  BCI  agrees  as  follows:
          A.  BCI  shall,  at its sole cost and expense and without contribution
from  BCP  or  BCPM,  carry out, to the extent not already implemented, the work
called  for  in  the Interim Measures Section (Section VII, paragraphs 19-58) of
the  Consent  Decree,  provided that as between BCI, on the one hand, and BCP or
BCPM  (or  any  other  entity owning or occupying all or any part of the Geismar
Property)  on  the  other,  BCI shall have the authority to plan, negotiate, and
implement  any  such work, provided further, however, that BCI shall provide BCP
with  prior  notice  of  and  opportunity to comment on any material plans being
submitted, material meetings or phone calls for negotiations being conducted, or
material work being implemented pursuant to the foregoing proviso, and BCP shall
have the right, but not the obligation, to participate at its own expense in any
such  meetings or phone calls.   It is understood that this Settlement Agreement
does  not  render  BCI  a party to the Consent Decree, but that BCI is obligated
under  this  Settlement  Agreement  with  respect  to  the  Interim  Measures as
prescribed  in the Consent Decree.  It is also understood that BCI's obligations
under  this  Settlement  Agreement  with  respect  to  the  Interim  Measures as
prescribed  in  the  Consent  Decree  shall include the obligations of BCP under
Sections I, IV, V, VIII, IX, X, XIII through XIX, and XXI of the Consent Decree,
to  the  extent  such  obligations  are  applicable to the implementation of the
Interim Measures as prescribed in the Consent Decree.   It is further understood
that  BCI's  obligations  under  this  Settlement  Agreement with respect to the
Interim  Measures  as  prescribed  in  the  Consent Decree shall not include any
environmental  condition  caused  after  the  effective  date of this Settlement
Agreement  by  any  person other than BCI; provided, however, that the migration
after  the effective date of this Settlement Agreement of contamination released
at  or  from the Geismar Property prior to the effective date of this Settlement
Agreement  shall  not  constitute  such  an environmental condition, unless such
migration  is  caused  by  the  acts  of  any  person other than BCI and BCI has
exercised  due  diligence  to  prevent  such  acts.
          B.  To the extent not addressed pursuant to the foregoing paragraph A,
BCI  shall,  at  its  sole cost and expense and without contribution from BCP or
BCPM,  investigate  and  remediate  any  contamination  of  soil  or groundwater
existing  on  or prior to the date of this Settlement Agreement, at or emanating
from  any solid waste management unit ("SWMU") identified in Attachment A of the
Consent  Decree  (a  particular  SWMU  so  identified is referred to herein as a
"SWMU"  followed  by the number or numbers designating it in Attachment A of the
Consent  Decree),  as  required  by  legal requirements applicable to the SWMUs,
including RCRA; provided that BCI shall have no obligation hereunder to become a
RCRA  permit  holder (it being understood that this shall not relieve BCI of any
obligation  to  obtain  such a permit if BCI operates a RCRA-regulated unit that
requires  such  a  permit), and provided further that as between BCI, on the one
hand,  and  BCP or BCPM (or any other entity owning or occupying all or any part
of  the  Geismar  Property)  on the other, BCI shall have the authority to plan,
negotiate,  and  implement  any  such  work, provided further, however, that BCI
shall  provide  BCP  with  prior  notice  of  and  opportunity to comment on any
material  plans  being  submitted,  material  meetings  or  phone  calls  for
negotiations being conducted, or material work being implemented pursuant to the
foregoing  proviso,  and  BCP  shall  have the right, but not the obligation, to
participate  at  its  own  expense  in  any  such  meetings  or  phone  calls.
     3.  BCP  agrees  as  follows:
          A.  BCP  shall,  at its sole cost and expense and without contribution
from  BCI, carry out the Supplemental Environmental Projects ("SEPs") called for
in  paragraph  71 under the Consent Decree, including closure in accordance with
Louisiana  state  laws  and regulations and, to the extent applicable, any other
legal  requirements,  of  the  underground injection units that constitute SWMUs
21-31;  provided  that  to  the  extent  such  closure  entails investigation or
remediation  of  soil or groundwater contamination that is subject to paragraphs
2.A  or  2.B  above,  such  investigation  or  remediation  shall  be  BCI's
responsibility.
          B.  BCP  shall,  at its sole cost and expense and without contribution
from  BCI,  undertake  the  closure,  in  accordance with the RCRA Part B permit
application  covering  such units and, to the extent applicable, any other legal
requirements,  of  the  following  SWMUs:  (1)      Sphere  Tank  (SWMU 1);  (2)
Bullet  Tank  (SWMU  2);  (3) VCR Day Tank (SWMU 3); and (4) VCR Unit (SWMU 19),
provided  that  with respect to SWMUs 1, 3 and 19, BCP shall not be obligated to
undertake such closure to the extent not required under applicable law by reason
of  a  transfer  to  a third party; and provided further that to the extent such
closure  entails  investigation  or  remediation  of  soil  or  groundwater
contamination that is subject to paragraphs 2.A or 2.B above, such investigation
or  remediation  shall  be  BCI's  responsibility.
          C.  BCP  shall,  at its sole cost and expense and without contribution
from  BCI,  undertake the decommissioning (as defined in Exhibit C to the Master
Asset  Conveyance  and  Facility  Support  Agreement, which agreement (including
exhibit  C  and  the  other  exhibits thereto) is Exhibit 4 hereto) of all SWMUs
identified  in  Attachment  A of the Consent Decree, with the exception of:  (1)
SWMUs  1-3,  19,  and  21-31,  which are referenced and addressed in 3.A and 3.B
above;  (2)  former  tank  farm  spill  tank  (SWMU  39);  (3) Monochem plant pH
equalization  sump (SWMU 41); (4) Salvage Yard (SWMU 50); (5) former Morton Salt
Plant  (under  formaldehyde  plant)  (SWMU 60 (BCP 54)); (6) methanol tank (SWMU
66);  and  (7)  various  SWMUs  associated  with  the wastewater treatment plant
(including  groundwater recharge units) (SWMUs 7-16, 32-38, 47, 56 (BCP 58), 57,
and  64  (BCP  65)).
     4.  In  consideration  of  the work that will be performed by BCI under the
terms  of  this  Settlement  Agreement,  and  except as specifically provided in
Paragraphs 5 and 6 of this Settlement Agreement, the United States and the State
of  Louisiana  covenant  not to sue or to take administrative action against BCI
for  claims  specifically  alleged  (without regard to the fact that such claims
were  not alleged against BCI) in the Plaintiffs' complaints in United States v.
                                                                ----------------
Borden  Chemicals  and  Plastics  Operating  Limited  Partnership  et  al.,  No.
--------------------------------------------------------------------------
94-2592-A-M2  (M.D.  La.) (Exhibits 5 and 6 hereto), the action that resulted in
--------
the  Consent  Decree,  as  if  such  claims  had been alleged against BCI.  This
covenant  not to sue is expressly conditioned upon the complete and satisfactory
performance  by  BCI  of  its  obligations  under this Settlement Agreement with
respect  to  the  Interim  Measures  Section  (Section VII, paragraphs 19-58) as
prescribed  in the Consent Decree, including the Attachments thereto, and may be
voided at any time prior to completion of such obligation if BCI fails to comply
with any of the requirements of this Settlement Agreement.  This covenant not to
sue  extends  only to BCI and its successors and assigns, and does not extend to
any  other  persons.
     5.  Subject  to  the  covenant  not  to sue in the preceding paragraph, the
United  States  and  the State of Louisiana retain all authority and reserve all
rights to take any and all actions authorized by law to protect human health and
the  environment.  Except  as  provided  in  paragraph  4  of  this  Settlement
Agreement,  the entry of this Settlement Agreement shall not limit or constitute
a waiver of any rights or remedies, or otherwise preclude the rights or remedies
of the United States or the State of Louisiana, and this Settlement Agreement is
without  prejudice to the United States' and the State of Louisiana's rights and
remedies  against  BCI, including but not limited to (1) the right to impose any
permit  requirements,  including  corrective  action  requirements under Section
3004(u)  and  (v)  of  RCRA,  42 U.S.C.   6924(u) and (v) or comparable State of
Louisiana  law if BCI operates a RCRA-regulated unit that requires such a permit
at  the Geismar Facility, (2) the right to require corrective action pursuant to
Sections  3008(h) and 7003 of RCRA, 42 U.S.C.    6928(h) and 6973; (3) the right
to  take  any  action  pursuant  to  the  Comprehensive  Environmental Response,
Compensation and Liability Act of 1980, as amended ("CERCLA"), 42 U.S.C.    9601
et seq., (4) the right to pursue remedies available to the United States and the
-- ---
State  of  Louisiana  for  any  violation  of  this Settlement Agreement, or any
federal  or  State  law,  regulation  or  permitting  condition not specifically
alleged  in  the  Plaintiffs' Complaints and resolved by the Consent Decree, and
(5)  the  right of the State of Louisiana to pursue any rights or remedies under
LEQA.  The  United  States  and the State of Louisiana reserve authority to take
any  action  authorized  by  law  if  there  may  be an imminent and substantial
endangerment  in connection with hazardous waste or hazardous constituents at or
from  the  Geismar  Property.
     6.  The  rights  reserved  to  the United States and the State of Louisiana
include  the  right  to  disapprove  of  work  performed by BCI pursuant to this
Settlement  Agreement.   BCI  shall  be  responsible  for obtaining any Federal,
State,  or  local  permit(s)  that  may  be  necessary  for BCI to undertake its
obligations under this Settlement Agreement with respect to the Interim Measures
as  prescribed  in  the  Consent  Decree.
     7.  Nothing  in  this Settlement Agreement shall be construed to modify any
provision of the Consent Decree.  Nor shall this Settlement Agreement create any
rights  in,  or  grant  any  cause  of action to, any person not a party to this
Settlement  Agreement, or release or waive any claim, cause of action, demand or
defense  in  law  or equity that any party to this Settlement Agreement may have
against  any  person(s)  or  entity  not  a  party to this Settlement Agreement.
     8.  Nothing  in  this Settlement Agreement shall be construed to permit any
third  party  purchaser  of the Geismar Property to avoid any ongoing statutory,
regulatory,  or  permit  obligations  under  RCRA,  the  Clean Air Act, or other
environmental provisions applicable to the ownership or operation of the Geismar
Property.
9.  The United States, the State of Louisiana, BCP, BCPM, or BCI may enforce the
terms  of  this  Settlement  Agreement,  including  the  Geismar  Environmental
Allocation  Agreement  which is incorporated herein, prior to the effective date
of  the plans of reorganization or liquidation of BCP and BCPM in the bankruptcy
court in which BCP's and BCPM's bankruptcy petitions have been filed; otherwise,
the  enforcement  of  this  Settlement  Agreement  shall be in the United States
District  Court  for the Middle District of Louisiana.  After the effective date
of  the  plans  of reorganization or liquidation, BCP, BCPM and BCI agree not to
contest  the  jurisdiction  of  the  United States District Court for the Middle
District  of  Louisiana  to  enforce  the  terms  of  this Settlement Agreement.
Nothing  in  this  Settlement  Agreement or the Geismar Environmental Allocation
Agreement  shall  relieve  BCP  of  any  obligations  under  the Consent Decree,
provided,  however,  that  to  the extent BCI is obligated under this Settlement
Agreement  or  the  Geismar  Environmental Allocation Agreement to carry out the
work  called  for  in  the Interim Measures Section of the Consent Decree and is
fulfilling  or  has  completed  such obligations, EPA and La.DEQ agree that they
will  not  take any action against BCP to enforce any obligation of BCP to carry
out  such  work.
10.   The  parties  retain the right to seek to enforce terms of this Settlement
Agreement  and  to  take  any  action  authorized  by  Federal  or State law not
inconsistent  with the terms of this Settlement Agreement to achieve or maintain
compliance  with  the  terms  and  conditions  of  this  Settlement  Agreement.
11.  This  Settlement  Agreement  will  be  subject to Bankruptcy Court approval
pursuant  to  Bankruptcy  Rule  9019.
     12.  This Settlement Agreement will be lodged with the Bankruptcy Court and
submitted  for  public  comment in the Federal Register for a period of not less
                                       ------- --------
than  fifteen  (15)  days.   The United States reserves the right to withdraw or
withhold  its  consent if the public comments regarding the Settlement Agreement
disclose facts or considerations which indicate that the Settlement Agreement is
inappropriate,  or  improper,  or  inadequate.  Subject  to paragraph 14 of this
Settlement Agreement, BCP, BCPM, and BCI consent to the entry of this Settlement
Agreement  without further notice.  After the public comment period, unless upon
review  of the public comments the United States determines that this Settlement
Agreement is inappropriate, the United States will move the Bankruptcy Court for
approval  of  this  Settlement  Agreement.
     13.  Upon  approval  of  this Settlement Agreement by the Bankruptcy Court,
the  Proof  of  Claim filed by the United States related to the Geismar Property
shall  be  deemed  resolved.
14.  This Settlement Agreement shall become effective upon the later to occur of
(a)  approval  by  the  Bankruptcy Court, and (b) closing under the Master Asset
Conveyance  and Facility Support Agreement.  If this Settlement Agreement is not
approved  by  the  Bankruptcy  Court, or if the closing does not occur under the
Master  Asset  Conveyance  and  Facility  Support  Agreement,  this  Settlement
Agreement  shall  be  of  no force and effect, whereupon nothing herein shall be
deemed an admission of any fact or waiver of any right of any party with respect
to  the  matters  contained  herein.
15.  This  Settlement Agreement may not be amended, modified or supplemented, in
whole  or  in  part, without the prior written consent of the parties hereto and
the  approval  of  the  Bankruptcy  Court.  To  the  extent  applicable to BCI's
obligations under this Settlement Agreement with respect to the Interim Measures
prescribed  by  the  Consent  Decree,  changes  to  the  technical  and schedule
provisions of this Settlement Agreement (incorporated by reference, in paragraph
2.A  above,  from the Consent Decree) may be made without approval by the Court,
upon  written  agreement  between  BCI,  EPA  and  La.DEQ.
SO  ORDERED  THIS  22nd  DAY  OF  October,  2002.

                       /s/_________________________________
                          JUDGE  PETER  J.  WALSH
                         U.S.  BANKRUPTCY  JUDGE




















































                                                        FOR  THE  UNITED  STATES
                                                        OF  AMERICA


                                          THOMAS  L.  SANSONETTI
                                          Assistant  Attorney  General
                                          U.S.  Department  of  Justice
                                          Environment  and  Natural  Resources
                                          Division


                                          /s/  Richard  Gladstein
                                          -----------------------
                                          RICHARD  GLADSTEIN
                                          Trial  Attorney
                                         Environmental  Enforcement  Section
                                         U.S.  Department  of  Justice
                                         P.O.  Box  7611
                                         Ben  Franklin  Station
                                         Washington,  D.C.  20044
                                         (202)  514-5409

                                         RICHARD  G.  ANDREWS
                                         United  States  Attorney
                                         District  of  Delaware

                                          ELLEN  SLIGHTS
                                         Assistant  United  States  Attorney
                                         Office  of  United  States  Attorney
                                         1201  Market  Street
                                         Suite  1100
                                         P.O.  Box  2046
                                         Wilmington,  DE  19899-2046
                                         OF  COUNSEL:
TERRY  SYKES
Associate  Regional  Counsel
EPA  Region  VI
Suite  1200
1445  Ross  Ave.
Dallas,  TX  75202
















































                                          FOR  THE  STATE  OF  LOUISIANA
                                          DEPARTMENT  OF  ENVIRONMENTAL
                                          QUALITY


                                          HERMAN  ROBINSON,
                                          GENERAL  COUNSEL  (#2077)



DATED:  September  4,  2002              /s/___________________________
                                          -------------------
                                         CHRISTOPHER  A.  RATCLIFF,
                                         Attorney  Supervisor
                                         Office  of  the  Secretary
                                         Legal  Affairs  Division
                                         Louisiana  Department  of
                                         Environmental  Quality
                                         P.O.  Box  82282
                                         Baton  Rouge,  Louisiana
                                         70884-2282




































































                                                    ATTORNEY  FOR  DEBTORS
                                                  AND  DEBTORS  IN  POSSESSION


                                                       DUANE  MORRIS  LLLP



DATED:  September  13,  2002       /s/_________________________________
                                   --------------------
                                 Michael  R.  Lastowski,  Esq.  (DE  I.D.  3892)
                                 1100  North  Market  Street,  Suite  1200
                                 Wilmington,  Delaware  19801
                                 Telephone:  (302)  657-4927
                                 Facsimile:  (302)  657-4901
                                 Email:  mlastowski@duanemorris.com

                                 and

                                 David  G.  Heiman  (OH-0038271)
                                 JONES,  DAY,  REAVIS  &  POGUE
                                 North  Point
                                 901  Lakeside  Avenue
                                 Cleveland,  Ohio  44114
                                 Telephone:  (216)  586-3939

                                 Neil  P.  Olack  (GA  551250)
                                 Brett  J.  Berlin  (GA  006764)
                                 JONES,  DAY,  REAVIS  &  POGUE
                                 3500  SunTrust  Plaza
                                 303  Peachtree  Street,  N.E.
                                 Atlanta,  Georgia   30308-3242
                                 Telephone:  (404)  521-3939




















































                                      Counsel  for  BCP  Management,  Inc.


                                     BLANK  ROME  COMISKY  &  MCCAULEY  LLP



DATED:  September  13,  2002        /s/_______________________________
                                    --------------------
                                    Michael  D.  DeBaecke,  Esquire  (No.  3186)
                                    1201  Market  Street,  Suite  800
                                    Wilmington,  DE    19801
                                   (302)  425-6400

                                              and

                                   Robert  J.  Sidman,  Esq.  (OH-0017390)
                                   Vorys,  Sater,  Seymour  &  Pease  LLP
                                   52  East  Gay  Street  (P.O.  Box  1008)
                                   Columbus,  Ohio    43215  (43216-1008
                                   (614)  464-6422




































































                                          BORDEN  CHEMICAL,  INC.



DATED:  September  13,  2002      /s/____________________________________
                                 --------------------
                                 John  C.  Phillips,  Jr.  (Bar  No.  110)
                                 Phillips  Goldman  &  Spence,  P.A.
                                 1200  N.  Broom  Street
                                 Wilmington,  DE  19806-4204
                                (302)  655-4200

                                 Mark  J.  Thompson
                                 William  T.  Russell,  Jr.
                                 SIMPSON  THACHER  &  BARTLETT
                                 425  Lexington  Avenue
                                 New  York,  NY  10017-3954
                                 Tel:  (212)  455-7070
                                 Of  Counsel

                                 Attorneys  for  Borden  Chemical,  Inc.
































































                                                                     EXHIBIT  21
                   BORDEN  CHEMICAL,  INC.,  CONSOLIDATED

        SUBSIDIARIES  OF  REGISTRANT  AS  OF  DECEMBER  31,  2002
      -------------------------------------------------------------


                                       The  percentage  of      State  or  other
                                       voting  securities       jurisdiction  of
                                       owned,  or  other        incorporation
Subsidiaries of Registrant:             basis of control        or organization
---------------------------            ----------------        ----------------

BCP  Management,  Inc.                          100                 Delaware
      BCP  Finance  Corporation                 100                 Delaware
BDS  Two,  Inc.                                 100                 Delaware
Borden  Chemical  Canada,  Inc.                 100                 Canada
Borden  Chemical  Foundry,  Inc.                100                 Delaware
     HA-International,  LLC                      75                 Pennsylvania
Borden  Chemical  Investments,  Inc.            100                 Delaware
Borden  Chemical  International,  Inc.          100                 Delaware
     Borden  Chemical  Australia  (Pty.)  Ltd   100                 Australia
         Borden/AEP  Australia  Superannuation
        (Pty)  Limited                          100                 Australia
Borden  Chemical  Foreign
         Sales  Corp.  V.  I.,  Inc.            100                 US  V.I.
Borden  Chemical  Holdings  (China)  Limited    100                 Hong  Kong
Borden  Chemical  Holdings  (Panama),  S.A.     100                 Panama
     Alba  Adesivos  Industria  E
        Comercio  Ltda.                         100                 Brazil
     Borden  Quimica  Industria  e
        Comercio  Ltda.                          99                 Brazil
     Borden  Chemical  (M.)  Sdn.  Bhd.         100                 Malaysia
     Borden  Chemical  Resinas,  Panama,  S.R.L.
                                                100                 Panama
     Quimica  Borden  Argentina  S.A.           100                 Argentina
Borden  Chemical  Philippines,  Inc.             98                 Philippines
Borden  Chimie,  S.A.                            98                 France
Borden  International  Holdings,  Ltd.          100                 UK
     Borden  Chemical  GB,  Ltd.                100                 UK
     Borden  Chemical  U.K.  Limited            100                 UK
        Borden  Bray,  Ltd.                     100                 Ireland
Compania  Quimica  Borden,  S.A.                100                 Panama
Gun  Ei  Borden  International  Resin  Co.  Ltd.  5                 Japan
Melamine  Chemicals,  Inc.                      100                 Delaware
Quimica  Borden  Espana,  S.A.                  100                 Spain
     Borden  Division  de  Consumo,  S.A.       100                 Spain

NOTE:     The above subsidiaries have been included in Registrant's Consolidated
Financial  Statements  on  a  consolidated  or equity basis as appropriate.  The
names of certain subsidiaries, active and inactive, included in the Consolidated
Financial Statements and of certain other subsidiaries not included therein, are
omitted  since  when  considered in the aggregate as a single subsidiary they do
not  constitute  a  significant  subsidiary.





































                          INDEPENDENT AUDITORS' CONSENT



We consent to the incorporation by reference in Registration Statement No.
33-57577 of Borden Chemical, Inc. (formerly Borden, Inc.) on Form S-3 of our
reports for Borden Chemical, Inc. dated March 12, 2003 (which report on the
Consolidated Financial Statements expresses an unqualified opinion and includes
an explanatory paragraph regarding the Company's adoption of Statement of
Financial Accounting Standard No. 142), appearing in this Annual Report on Form
10-K of Borden Chemical, Inc. for the year ended December 31, 2002.


DELOITTE  &  TOUCHE  LLP

Columbus,  Ohio
March  27,  2003


































































                                                                   Exhibit  99




                            CERTIFICATION PURSUANT TO
                             18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002


     In  connection  with  the  Annual  Report  of  Borden  Chemical,  Inc. (the
"Company") on Form 10-K for the period ended December 31, 2002 as filed with the
Securities  and  Exchange  Commission  on  the  date  hereof (the "Report"), the
undersigned, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section  906  of  the  Sarbanes-Oxley  Act  of  2002,  that:

1.     The  Report  fully  complies with the requirements of Section 13(a) or 15
(d)  of  the  Securities  Exchange  Act  of  1934;  and

2.     The  information contained in the Report fairly presents, in all material
respects,  the  financial  condition  and  results of operations of the Company.


/s/ Craig O. Morrison
-------------------------
Craig  O.  Morrison
Chief  Executive  Officer
March  27,  2003



























































                                                                   Exhibit  99




                            CERTIFICATION PURSUANT TO
                             18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002


     In  connection  with  the  Annual  Report  of  Borden  Chemical,  Inc. (the
"Company") on Form 10-K for the period ended December 31, 2002 as filed with the
Securities  and  Exchange  Commission  on  the  date  hereof (the "Report"), the
undersigned, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section  906  of  the  Sarbanes-Oxley  Act  of  2002,  that:

1.     The  Report  fully  complies with the requirements of Section 13(a) or 15
(d)  of  the  Securities  Exchange  Act  of  1934;  and

2.     The  information contained in the Report fairly presents, in all material
respects,  the  financial  condition  and  results of operations of the Company.


/s/ William H. Carter
-------------------------
William  H.  Carter
Chief  Financial  Officer
March  27,  2003