Exhibit 10.1


 


EXECUTION
VERSION


 


Certain sections of this
document have been the subject of a confidential treatment request.  Any text that has been removed pursuant to
Rhodia’s confidential treatment request has been separately submitted to the U.S.
Securities and Exchange Commission. 
Deleted text herein is marked [“***”]. 
Where several pages of text have been deleted the number of pages
removed has been noted.


 


SECURED
CO-ORDINATION AGREEMENT


 


DATED 23RD DECEMBER, 2003


 


BETWEEN


 


RHODIA S.A.


the Company and the Guarantor


 


BORROWING GROUP MEMBERS


 


THE LENDERS


 


and


 


BNP PARIBAS


as Intercreditor Agent


 


and


 


FACILITY AGENTS


 


THIS AGREEMENT IS ENTERED INTO WITH THE BENEFIT OF AND
SUBJECT TO THE TERMS OF A SECURITY SHARING AGREEMENT AND SUBORDINATION
AGREEMENT WHEN ENTERED INTO


 


ALLEN
& OVERY


 


PARIS


 

















 


CONTENTS


 


	
  Clause

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	 

	
  1.

  	
   

  	
  Interpretation

  	
   

  	 

	
  2.

  	
   

  	
  Conditions
  precedent

  	
   

  	 

	
  3.

  	
   

  	
  Secured Intercreditor
  Period

  	
   

  	 

	
  4.

  	
   

  	
  Affected
  Facilities

  	
   

  	 

	
  5.

  	
   

  	
  Payments

  	
   

  	 

	
  6.

  	
   

  	
  New Guarantee

  	
   

  	 

	
  7.

  	
   

  	
  Mandatory
  prepayment and cancellation

  	
   

  	 

	
  8.

  	
   

  	
  Representations and
  warranties

  	
   

  	 

	
  9.

  	
   

  	
  Undertakings

  	
   

  	 

	
  10.

  	
   

  	
  Financial
  covenants

  	
   

  	 

	
  11.

  	
   

  	
  Default

  	
   

  	 

	
  12.

  	
   

  	
  The Administrative Parties

  	
   

  	 

	
  13.

  	
   

  	
  Expenses

  	
   

  	 

	
  14.

  	
   

  	
  Changes
  to the Parties

  	
   

  	 

	
  15.

  	
   

  	
  Amendments
  and waivers

  	
   

  	 

	
  16.

  	
   

  	
  Confidentiality

  	
   

  	 

	
  17.

  	
   

  	
  Stamp duties

  	
   

  	 

	
  18.

  	
   

  	
  Indemnities

  	
   

  	 

	
  19.

  	
   

  	
  Co-ordinating
  Committee

  	
   

  	 

	
  20.

  	
   

  	
  Severability

  	
   

  	 

	
  21.

  	
   

  	
  Counterparts

  	
   

  	 

	
  22.

  	
   

  	
  Notices

  	
   

  	 

						



 

















 


	
  23.

  	
   

  	
  Language

  	
   

  	 

	
  24.

  	
   

  	
  Jurisdiction

  	
   

  	 

	
  25.

  	
   

  	
  Waiver of immunity

  	
   

  	 

	
  26.

  	
   

  	
  Governing law

  	
   

  	 

	
  Schedules

  	
   

  
	
  1.

  	
   

  	
  Various Parties

  	
   

  	 

	
   

  	
   

  	
  Part 1

  	
  The Borrowing
  Group

  	
   

  	 

	
   

  	
   

  	
  Part
  2

  	
  The
  Original Obligors

  	
   

  	 

	
   

  	
   

  	
  Part 3

  	
  Original Lenders

  	
   

  	 

	
   

  	
   

  	
  Part 4

  	
  Facility Agents

  	
   

  	 

	
  2.

  	
   

  	
  Conditions precedent documents

  	
   

  	 

	
   

  	
   

  	
  Part
  1

  	
  Conditions
  Precedent documents to be provided in form and substance satisfactory to each
  Original Lender are marked with an asterisk (*)

  	
   

  	 

	
   

  	
   

  	
  Part 2

  	
  Conditions precedent
  documents

  	
   

  	 

	
   

  	
   

  	
  Part
  3

  	
  Additional
  Obligor Conditions Precedent Documents

  	
   

  	 

	
  3.

  	
   

  	
  The Existing Facilities, Affected Facilities
  and Exposures

  	
   

  	 

	
  4.

  	
   

  	
  Security—Existing Security Interests

  	
   

  	 

	
  5.

  	
   

  	
  Accession Agreement

  	
   

  	 

	
  6.

  	
   

  	
  Business Plan including Liquidity Analysis

  	
   

  	 

	
   

  	
   

  	
  Part 1

  	
  Rhodia Business
  Plan After Disposals

  	
   

  	 

	
   

  	
   

  	
  Part 2

  	
  Liquidity
  Analysis

  	
   

  	 

	
  7.

  	
   

  	
  Inter-Company Loans

  	
   

  	 

	
   

  	
   

  	
  Part 1

  	
  Intercompany
  Loans/Borrowings between Rhodia S.A. and its Subsidiaries

  	
   

  	 

	
   

  	
   

  	
  Part 2

  	
  Intercompany
  Loans/Borrowings between the Rhodia Subsidiaries (as of 30th November, 2003)

  	
   

  	 

	
  8.

  	
   

  	
  ERISA Events

  	
   

  	 

	
  9.

  	
   

  	
  Agreed Lease Amendment Principles

  	
   

  	 

	
  10.

  	
   

  	
  Form of Compliance Certificate

  	
   

  	 

	
  11.

  	
   

  	
  Agreed Security Principles

  	
   

  	 

	
   

  	
   

  	
  Part 1

  	
  General

  	
   

  	 

	
   

  	
   

  	
  Part 2

  	
  Secured Assets

  	
   

  	 

	
   

  	
   

  	
  Part 3

  	
  Beneficiaries

  	
   

  	 

	
   

  	
   

  	
  Part 4

  	
  Security Sharing Principles

  	
   

  	 

	
  Signatories

  	
   

  	
   

  
									



 

















 


THIS
AGREEMENT is dated
23rd December, 2003 between:


 


(1)                                  RHODIA S.A. (a company incorporated in France
(Registered No. 352-170-161) with its registered office at 26 quai Alphonse Le
Gallo 92100 Boulogne Billancourt) (the Company);


 


(2)                                  BORROWING GROUP MEMBERS listed in Part 2 of Schedule 1 (each an Original Obligor and together the Original Obligors);


 


(3)                                  RHODIA S.A. (the Guarantor);


 


(4)                                  THE FINANCIAL INSTITUTIONS listed in Part 3 of Schedule 1 (the Original Lenders);


 


(5)                                  BNP PARIBAS as intercreditor agent for the Lenders (in
this capacity the Intercreditor Agent);
and


 


(6)                                  AGENTS UNDER AFFECTED
FACILITIES listed in Part 4
of Schedule 1 (each a Facility Agent,
together the Facility Agents).


 


IT IS
AGREED as follows:


 

















 


1.                                      INTERPRETATION


 


1.1                               Definitions


 


In this Agreement:


 


Additional Obligor means a Borrowing Group Member which becomes an Obligor after the date
of this Agreement.


 


Accession Agreement means an agreement in the form of Schedule 5 (Accession Agreement)
with such amendments as the Intercreditor Agent may approve or reasonably
require.


 


Affected Facility means each of the facilities referred to in Schedule 3 and designated as
“Affected Facilities” and in respect of which the relevant Lender is a Party to
this Agreement.


 


Affected Facility Agreement means any Facility Agreement constituting or
evidencing any Affected Facility.


 


Affiliate means a Subsidiary or a Holding Company of a person or any other
Subsidiary of that Holding Company.


 


Agent
means the Intercreditor Agent and/or the Security Agent.


 


Agreed Lease Amendment Principles means the agreed lease amendment principles
set out in Schedule 9 (Agreed Lease Amendment Principles).


 


Agreed Security Principles means the security principles set out in
Schedule 11.


 


Asset
means:


 


(a)                                  each asset of the Group included in the Asset
Disposal Programme from time to time;


 


(b)                                 any shares or capital stock or equivalent in
any member of the Group; and


 


(c)                                  any assets which are disposed of under Clause
9.9(b)(iv), (but excluding, for the avoidance of doubt, assets disposed of
under Clause 9.9(b)(i), (ii) and (iii)).


 


Asset Disposal Programme means together:


 


(a)                                  an asset disposal programme generating net
cash proceeds of not less than €400,000,000 by no later than 30th June, 2004
(of which no less than €200,000,000 is actually received by the Company in cash
by that date without condition, with the balance to be received in cash, subject
only to satisfaction of conditions outside the control of the buyer or seller
(or their respective affiliates) under binding sale and purchase agreements
entered into prior to 30th June, 2004, and where such balance is actually
received in cash in any event on or before 31st December, 2004); and


 


(b)                                 an additional asset disposal programme
generating additional net cash proceeds of not less than €700,000,000 minus the
net cash proceeds generated from the first disposal programme referred to in
paragraph (a) above, to be received by the Company by no later than 31st
December, 2004,


 


in each case where net cash proceeds means cash proceeds net
of any Taxes payable in the financial year in which the disposal is effected or
proceeds received and reasonable third party costs and expenses attributable to
the disposal, receipt or recovery, as set out in reasonable detail in a
certificate provided to the Intercreditor Agent by the chief financial officer
of the Company.


 


Borrowing Group means each entity listed in Part 1 of Schedule 1.


 


Borrowing Group Member means each member of the Borrowing Group.


 


Business Day means a day (other than a Saturday or a Sunday) on which banks are
generally open for business in London and Paris and:


 


(a)                                  if on that day a payment in or a purchase of
a currency (other than Euro), is to be made, the principal financial centre of
that currency; or


 


(b)                                 if on that day a payment in or a purchase of
Euro is to be made, which is also a Target Day.


 


Business Plan means the business plan to be provided by the Company to the Lenders
as updated on a quarterly basis to include the liquidity analysis in the form
set out in Schedule 6 (Business Plan including Liquidity Analysis).


 

















 


Calculation Point means 5.00 p.m. (Paris time) on 30th November, 2003.


 


Code
means the United States Internal Revenue Code of 1986, as amended and the rules
and regulations promulgated thereunder from time to time in effect.


 


Commencement Date means the date on which the Intercreditor Agent provides the
notification to each Party as specified in Clause 2 (Conditions Precedent).


 


Compliance Certificate means a certificate signed by the chief
financial officer or statutory auditors of the Company, as applicable,
substantially in the form of Schedule 10.


 


Co-ordinating Committee means the committee appointed in accordance
with a co-ordinating committee letter dated 30th November, 2003.


 


Dangerous Substance means any radioactive emissions, noise and any natural or artificial
substance (in whatever form) the generation, transportation, storage, treatment
or disposal of which (whether alone or in combination with any other substance)
gives rise to a risk of causing harm to man or any other living organism or
damaging the Environment or public health or welfare including (without
limitation) any controlled, special, hazardous, toxic, radioactive or dangerous
waste.


 


Declared Default means (following a request by any Lender) a notification by the
Intercreditor Agent (acting on the instructions of the Majority Lenders) that
an Event of Default has occurred and is outstanding.


 


Default means (a) an Event of Default; or (b) an event or circumstance which
with the expiry of a grace period, the giving of notice, lapse of time,
determination of materiality or fulfilment of any other applicable condition
(or any combination of the foregoing) is likely to constitute an Event of
Default.


 


Derivative Deposit means, in relation to Lenders under Derivative Instruments referred to
in Schedule 3, the deposit or payment of collateral in an amount equal to the
positive difference (if any) by which that Lender’s Exposure in respect of
Derivative Instruments on the last Business Day of each calendar month exceeds
its maximum Exposure in respect of Derivative Instruments as set out against
its name in Schedule 3 up to a maximum aggregate amount not exceeding
€40,000,000 (or its equivalent in other currencies).


 


Derivative Instrument means any swap, cap, collar, floor, option,
forward or any other agreement or arrangement in the nature of a derivative
instrument.


 


Derivative Liability means, on any date and in respect of any Derivative Instrument between
any member of the Group, any Borrowing Group Member and any creditor, the
amount (if any) payable by that member of the Group or Borrowing Group Member
to that creditor on termination of that Derivative Instrument on that date (or
which would have been payable by that member of the Group or Borrowing Group
Member to that creditor had that Derivative Instrument been terminated on that
date) (where the amount shall be the “marked-to-market” value of that contract
or instrument and shall take into account the operation of any netting provisions
contained within that instrument or contract or master agreement including the
netting of one or more Derivative Instruments between the same creditor and
member of the Group or Borrowing Group Member under the same master agreement).


 


EMTN
means a Euro medium term note programme for the Company in an amount of
€1,800,000,000 as described in an offering circular dated 5th October, 2001.


 


Enforcement Action in respect of an Affected Facility means any of the following actions:


 


(a)                                  to submit a petition for (or vote in favour
of any resolution in any insolvency proceedings) or initiate or support or take
any steps with a view to any bankruptcy, insolvency, liquidation, business
reorganisation or rehabilitation, administration receivership, execution or dissolution
proceedings under any insolvency and composition laws or any similar
proceedings (or any analogous proceedings in any other jurisdiction) involving
the Company or any of its subsidiaries;


 


(b)                                 to serve a notice of a default, event of
default or termination event (howsoever described) on the relevant Borrowing
Group Member, to place on demand, to make demand for or accelerate the due date
for, or declare prematurely payable any moneys under any Affected Facility;


 


(c)                                  to commence or continue any action to enforce
the payment of any amount under any Affected Facility;


 

















 


(d)                                 where a breach of contract or
misrepresentation by a Borrowing Group Member under an Affected Facility
results in or from a default, event of default or termination event (howsoever
described), to commence or continue any legal action against that member for
repudiation or rescission of that Affected Facility or damages for loss (or
equivalent), in each case, as a consequence of that breach of contract or
misrepresentation;


 


(e)                                  to take any action to cancel any funded
commitment to lend or to close out or terminate or cancel any swap or similar
hedging arrangement, any guarantee, letter of credit or like commitment in
favour of a third party or any foreign exchange facility, in each case, under
any Affected Facility but excluding any action to close out or terminate any
swap or similar hedging arrangements where any Borrowing Group Member is “in
the money” as a result of close out or termination;


 


(f)                                    to exercise any right of appropriation,
amalgamation of accounts counter-claim or set-off in reduction of outstandings
under any Affected Facility, except that Lenders may continue to apply netting
arrangements in effect as at date of this letter in accordance with the
existing terms thereof; or


 


(g)                                 to take any action to perfect (except if
required to maintain a Security Interest then existing) or to enforce or make
any demand under any Security Interest or any guarantee, indemnity or like
commitment or similar support (except as contemplated by Clause 4.3(d)(iv))
given in connection with an Affected Facility by any Borrowing Group Member or
any other person.


 


Environment means all, or any of, the following media: the air (including air
within other natural or man-made structures above or below ground), water
(including, without limitation, ground and surface water) and land (including,
without limitation, surface and sub-surface soil).


 


Environmental Law means all laws (including, without limitation, common law),
regulations, directives, codes of practice, circulars, guidance notes and the
like having legal effect concerning the protection of human health, the
Environment, the conditions of the workplace or the generation, transportation,
storage, treatment or disposal of Dangerous Substances.


 


Environmental Licence means any permit, licence, authorisation,
consent or other approval required by any Environmental Law.


 


ERISA
means the United States Employee Retirement Income Security Act of 1974 and the
rules and regulations promulgated thereunder from time to time in effect.


 


ERISA Event means any event specified in Schedule 7 Part 2.


 


ERISA Affiliate means any trade or business (whether or not incorporated) that is
treated as a single employer together with the Company under section 414 of the
Code.


 


Euro
means the single currency of the Participating Member States.


 


Event of Default means an event or circumstance specified as such in this Agreement.


 


Excluded Facility means:


 


(a)                                  an uncommitted Facility which is not an
Affected Facility;


 


(b)                                 the Euro 12,420,000 term loan facility dated
21st January, 1995 between CCF and Rhodia Silicone backed by the European
Investment Bank;


 


(c)                                  any Unaffected Credit Facility to the extent
any reduction in Exposures under that Facility is refinanced in full at the
time of that reduction by an Unaffected Credit Facility with a final maturity
date no earlier than that of the refinanced Unaffected Credit Facility and on
terms which do not put or seek to put the creditor of the refinanced Unaffected
Credit Facility in a preferred position as against any Lender as provided in
Clause 4.7(b);


 

















 


(d)                                 any Unaffected Committed Facility to the
extent that:


 


(A)                              any reduction in Exposures under that
Facility is refinanced at the time of the reduction by an Unaffected Credit
Facility (i) with a final maturity date falling no earlier than both (x) the
Term Date; and (y) the final maturity date of the refinanced Facility; and (ii)
on terms that do not put or seek to put the creditor of the refinanced Facility
in a preferred position as against any Lender as provided in Clause 4.7(b); and


 


(B)                                the aggregate amount of Exposures under the
Unaffected Committed Credit Facilities is not less than 95% of the aggregate
amount of Exposures under the Unaffected Committed Facilities on the date of
this Agreement at any time;


 


(e)                                  any sale of receivables or forfaiting
Facility which is not an Affected Facility; and


 


(f)                                    each Refinanced Facility to the extent
prepaid in full by the Refinancing Facilities Agreement.


 


Existing Facility means those Facilities which exist at the date of this Agreement,
brief details of which are listed in Schedule 3.


 


Existing Facility Agreement means any agreement or instrument
constituting or evidencing any Existing Facility.


 


Existing Security Interests means any Security Interest granted by any
member of the Group or any Borrowing Group Member over any asset of that member
in respect of any Existing Facility as at the date of this Agreement which is
either over the assets leased under existing Lease Facilities or as listed in
Schedule 4.


 


Exposure in relation to any creditor under a Facility means at any time:


 


(a)                                  in relation to loan facilities, overdrafts
and credit lines made available to any Borrowing Group Member the actual
aggregate principal amount outstanding to that creditor at that time net of
credit balances to the extent of any netting arrangement in effect at the time;


 


(b)                                 in relation to guarantees, letters of credit
and similar financial accommodation issued by that creditor for the account of
any Borrowing Group Member the maximum aggregate contingent liability of that
creditor under that instrument at that time;


 


(c)                                  in relation to any other financial
accommodation made available to any member of the Borrowing Group, the maximum
aggregate net exposure or exposures or contingent liability of that creditor at
that time determined in accordance with the usual market practice and in
respect of a US synthetic lease shall be calculated by reference to the total
outstanding notes and unrepaid investment of each lessor and owner participant
thereunder;


 


(d)                                 in relation to any Derivative Instrument, the
Derivative Liability in respect thereof; and


 


(e)                                  for the avoidance of doubt, excluding, in
each case, all related interest, fees, commission, banking, legal and other
charges and expenses,


 


and provided that: (i) any
contingent claim (including without limitation a contingent claim with respect
to a guarantee or letter of credit facility) shall, until the contrary is
demonstrated to the reasonable satisfaction of the relevant creditor, be
calculated on the basis that the amount claimed corresponds to a principal
amount and the contingent claim will become payable in full; and (ii) if there
is a dispute between a Lender and the Company with respect to the calculation
of its Exposure that Lender and the Company shall appoint (at the cost of the
Company) an independent expert to act as an expert and not as an arbitrator to
determine the same. The determination by such expert shall be binding on the
parties.


 


Facility means any facility under which a member of the Group, any Relevant
Entity or any Joint Venture Entity has or may incur Financial Indebtedness or
under which there is recourse to a member of the Group in respect of Financial
Indebtedness.


 


Facility Agreement means any agreement or instrument constituting or evidencing any
Facility.


 


Fee Letter means the letter(s) dated on or about the date of this Agreement and
entered into between amongst others the Intercreditor Agent and the Company
setting out the amount of certain fees to be paid in connection with this
Agreement.


 


Finance Document means:


 


(a)                                  this Agreement;


 


(b)                                 an Accession Agreement;


 


(c)                                  the Security Sharing Agreement;


 

















 


(d)                                 each Security Document;


 


(e)                                  the Subordination Agreement;


 


(f)                                    the Fee Letter; and


 


(g)                                 any other document designated as such in
writing by the Company and the Intercreditor Agent.


 


Finance Party means a Lender, each Facility Agent, the Security Agent and the
Intercreditor Agent.


 


Financial Indebtedness means any indebtedness for or in respect of:


 


(a)                                  moneys borrowed and debit balances at banks;


 


(b)                                 any debenture, bond, note, loan stock or
other similar instrument;


 


(c)                                  any acceptance credit;


 


(d)                                 receivables sold or discounted (otherwise
than on a non-recourse basis) including, for the avoidance of doubt,
Securitisation Programmes and sale of receivables under Existing Facilities;


 


(e)                                  the acquisition cost of any asset to the
extent payable before or after its acquisition or possession by the party
liable where the advance or deferred payment is arranged primarily as a method
of raising finance or financing the acquisition of that asset;


 


(f)                                    any lease (including, without limitation, a
capital lease and each lease listed in Schedule 3) entered into primarily as a
method of raising finance or financing the acquisition of the asset leased;


 


(g)                                 any Derivative Instrument;


 


(h)                                 any amount outstanding under a Facility or
any amount raised through any other transaction (including any forward sale or
purchase agreement) which has the commercial effect of a borrowing or raising
of money;


 


(i)                                     any counter-indemnity obligation in respect
of any guarantee, indemnity, bond, letter of credit or any other instrument
issued by a bank or financial institution; or


 


(j)                                     any guarantee, indemnity or similar assurance
against financial loss of any person.


 


Group
means the Company and its Subsidiaries.


 


Group Structure Chart means the chart describing the capital and
share ownership of all the members of the Group and the Borrowing Group delivered
as a condition precedent under Schedule 2.


 


High Yield Bonds means the 7.625% US dollar denominated senior notes due 2010, the 8.0%
Euro denominated senior notes due 2010, the 8.875% US dollar denominated senior
notes due 2011 and the 9.25% Euro denominated senior notes due 2011 referred to
in Schedule 3.


 


Holding Company means, in relation to a person, a company in respect of which that
person is a Subsidiary.


 


Insolvency Event means any Event of Default specified in Clauses 11.7 (Insolvency) to
11.12 (Analogous proceedings) (inclusive).


 


Inter-Company Debt means any debt incurred by an Obligor and outstanding to an Affiliate
of the Company.


 


Joint Venture Entity means any unconsolidated subsidiary of the Company or joint venture
entity, in each case:


 


(a)                                  in which the Company owns or effectively
controls, directly or indirectly at least twenty per cent. (20%) of the capital
and voting rights; and


 

















 


(b)                                 in relation to the Financial Indebtedness of
which, no Borrowing Group Member has given a guarantee, indemnity or similar
assurance against financial loss.


 


Lease Facility means a lease facility appearing under the
sub-heading “Operating Lease” in Schedule 3.


 


Lease Under Construction Facility means an Existing Facility in relation to a
leasing of a site under construction.


 


Lender
means:


 


(a)                                  an Original Lender; or


 


(b)                                 any bank or financial institution which has
executed and delivered to the Intercreditor Agent an Accession Agreement in
accordance with Clause 14.3 (Transfers by Lenders) and Clause 14.4 (Accession),


 


in each case in its capacity
as a Lender under each Affected Facility to which it is party and not any other
Facility.


 


Lessor Reduction means, in relation to certain Lease Facilities, the reduction of
Exposure thereunder by provision of cash collateral or by way of an early
prepayment of rent or the purchase by the lessee of the assets leased in an
amount equal to 5 per cent. of the relevant lessor’s exposure under the
relevant lease as such Exposure is set out against its name under the heading
“Prepayable” in Schedule 3 to be made on or around the date of this Agreement
and on the Term Date.


 


Limited Recourse means customary recourse by any provider of Financial Indebtedness
incurred by a member of the Group in connection with securitisation of
receivables pursuant to the existing terms of an existing Securitisation
Programme referred to in Schedule 3 to the extent such recourse may be incurred
by that member of the Group in accordance with such terms on the date of this
Agreement.


 


Majority Lenders means, on any date on which a determination is to be made, Lenders
whose Exposures aggregate at least 66 2/3 per cent. of
the aggregate Exposures of all Lenders where the Exposures (converted into Euro
at the Spot Rate of Exchange) are calculated by reference to the amount and
Spot Rate of Exchange as at the last day of the month ending immediately prior
to the date on which a determination is to be made.


 


Material Adverse Effect means a material adverse effect on or
circumstance affecting:


 


(a)                                  the business, assets or financial condition
of the Company, a Material Subsidiary or the Group (taken as a whole); or


 


(b)                                 the ability of any Borrowing Group Member to
perform or comply with any of its payment obligations (after taking into
account any guarantee in relation to that payment obligation which is available
on demand) or to comply with or perform any other material obligation under any
Finance Document or any Facility Agreement; or


 


(c)                                  the validity or enforceability of any Finance
Document or any Facility Agreement or the effectiveness of any Security
Interest over the assets purported to be covered by any Security Document, or
the value of the security (taken as a whole).


 


Material Subsidiary means at any time any Subsidiary of the Company whose net assets or
EBITDA then equal or exceed 5 per cent. of the total net assets or EBITDA of
the Group.


 


For this purpose:


 


(i)                                     the net assets or EBITDA of the relevant
entity will be determined from its financial statements (consolidated if it has
Subsidiaries) upon which the latest audited financial statements of the Group
have been based;


 


(ii)                                  if a Subsidiary of the Company becomes a
member of the Group after the date on which the latest audited financial
statements of the Group have been prepared, the net assets or EBITDA of that
Subsidiary will be determined from its latest financial statements;


 


(iii)                               the total net assets or EBITDA of the Group
will be determined from its latest audited financial statements, adjusted
(where appropriate) to reflect the net assets or EBITDA of any company or
business subsequently acquired or disposed of; and


 

















 


(iv)                              if a Material Subsidiary disposes of all or
substantially all of its assets to another Subsidiary of the Company, it will
immediately cease to be a Material Subsidiary and the other Subsidiary (if it
is not already) will immediately become a Material Subsidiary; the subsequent
financial statements of those Subsidiaries and the Group will be used to
determine whether those Subsidiaries are Material Subsidiaries or not.


 


If there is a dispute as to
whether or not a company is a Material Subsidiary under paragraph (b) of this
definition, a certificate of the auditors of the Company will be, in the
absence of manifest error, conclusive.


 


For the purposes of the
above, each reference to EBITDA is to EBITDA as defined in Clause 10.1
(Financial covenant definitions).


 


Member
means, at any time, a member of the Co-ordinating Committee.


 


Multiemployer Plan means a multiemployer plan, as defined in Section 400(a)(3) of ERISA,
to which the Company or any ERISA Affiliate is making or accruing (or is
required to make or accrue) an obligation to make contributions, or has within
any of the preceding five plan years made or accrued (or was required to make
or accrue) an obligation to make contributions.


 


Obligor means: (i) the Company, an Original Obligor or an Additional Obligor
(in each case party to this Agreement); (ii) a Borrowing Group Member (whether
or not party to this Agreement) and (iii) for the purposes of Clause 11
(Default) only, any other member of the Group which is party to any Finance
Document.


 


Original Business Plan means the Business Plan provided on 30th
November, 2003 as validated by Ernst & Young.


 


Original Financial Statements means the consolidated financial statements
of the Company for the half-year ended 30th June, 2003 subject to a limited
review by the Company’s statutory auditors.


 


Overdraft Facilities means any overdraft facility provided by a creditor to any member of
the Group including any other facility which in the normal course of usage
operates on a fluctuating basis, together with any facility under which any
Finance Party guarantees such facility.


 


Participating Member States means a member state of the European
Communities that adopts or has adopted the Euro as its lawful currency under
the legislation of the European Union for European Monetary Union.


 


Party
means a party to this Agreement.


 


PBGC
means the Pension Benefit Guaranty Corporation referred to and defined in ERISA
or any successor thereto.


 


Permitted Reorganisation means an amalgamation, demerger, merger or
reconstruction involving the Company:


 


(a)                                  full details of which are provided by the
Company to the Intercreditor Agent in a timely manner prior to its taking
place; and


 


(b)                                 where the surviving entity (whether or not it
is the Company) has a long-term corporate credit rating from Standard &
Poor’s of BBB- or higher or an equivalent rating from Moody’s; and


 


(c)                                  in relation to which the Intercreditor Agent
has first received legal opinions from external counsel addressed to the
Finance Parties, in form and substance satisfactory to the Intercreditor Agent,
confirming:


 


(i)                                     either that the Company shall be the
surviving entity and that notwithstanding such amalgamation, demerger or
reconstruction, the Transaction Documents shall remain at all times the legal,
valid and binding obligations of the Company, enforceable in accordance with
their terms; or


 


(ii)                                  that upon such amalgamation, demerger or
reconstruction the surviving entity (not being the Company) will accede to the
obligations of the Company under the Transaction Documents in full and that the
Transaction Documents shall be the legal, valid and binding obligations of the
surviving entity, enforceable in accordance with their terms; and


 


(d)                                 where the place of incorporation and
registered head office of the surviving entity is within the European Union,


 


and to which the
Intercreditor Agent (acting on the instructions of the Requisite Lenders) has
given its prior written consent.


 

















 


Plan
means a Single Employer Plan or a Multiemployer Plan.


 


Prepayment Event means any of:


 


(a)                                  the entry by the Company into any
amalgamation, demerger, merger or reconstruction which is not a Permitted
Reorganisation (including, without limitation, an amalgamation, demerger,
merger or reconstruction resulting from or constituted by the Company making a
disposal or disposals of assets, or a Material Subsidiary making a disposal or
disposals of assets to the Company, in each case under Clause 9.9 (Disposals)
but excluding, for the avoidance of doubt, assets disposed of under Clause
9.9(b)(iv)); or


 


(b)                                 any person, or group of persons acting in
concert, acquiring more than 50% of the issued and fully paid up share capital
or voting rights in the Company; or


 


(c)                                  the direct or indirect sale, transfer,
conveyance or other disposition (other than by way of merger or consolidation
permitted by and made in accordance with the provisions of this Agreement) in
one or a series of related transactions, of all or substantially all of the
properties or assets or business of the Company and its Subsidiaries taken as a
whole; or


 


(d)                                 the adoption of a plan relating to the
liquidation or dissolution of the Company.


 


Refinanced Facilities means each of the Existing Facilities to be
refinanced under the Refinancing Facilities Agreement referred to in Schedule 3
as “Refinanced Facilities”.


 


Refinancing Facilities Agreement means the refinancing facilities agreement
to be entered into between, amongst others, the Company, each Borrowing Group
Member which is a borrower under the Refinanced Facilities and the Original
Lenders which are lenders under the Refinanced Facilities on terms set out in
the Refinancing Facilities Term Sheet in a form agreed between the parties
thereto.


 


Refinancing Facilities Term Sheet means the term sheet attached to the
refinancing facilities term sheet letter from the Lenders party thereto to the
Company dated on or around the date of this Agreement in respect of the
Refinancing Facilities Agreement, delivered to the Intercreditor Agent as a
condition precedent document under Schedule 2 for identification purposes only.


 


Relevant Entity means an unconsolidated subsidiary of the Company or joint venture
entity, in each case:


 


(a)                                  in which the Company owns or effectively
controls, directly or indirectly, at least twenty per cent. (20%) of the
capital and voting rights; and


 


(b)                                 in relation to the Financial Indebtedness of
which, a Borrowing Group Member has given a guarantee, indemnity or similar
assurance against financial loss.


 


Relevant Proportion in relation to an Affected Facility means the proportion which the
aggregate of the Exposures of the Lenders with respect to that Affected
Facility bears to the aggregate of the Exposures of all the Lenders in relation
to the Affected Facilities (and for these purposes, the Exposures are taken at
their Euro amount on any date on which a Relevant Proportion is ascertained).


 


Requisite Lenders means, at any date on which a determination is to be made, the Lenders
whose Exposures aggregate at least 50% of the aggregate Exposures of all
Lenders where the Exposures (converted into Euro at the Spot Rate of Exchange)
are calculated by reference to the amount and Spot Rate of Exchange as at the
last day of the month ending immediately prior to the date on which a
determination is to be made.


 


Rights Issue means any equity rights issue by the Company generating net cash
proceeds of no less than €300,000,000 to be launched by the Company by no later
than 15th May, 2004 where net cash proceeds means cash proceeds net of any
Taxes and third party costs and expenses attributable to the issue as set out
in reasonable detail in a certificate provided to the Intercreditor Agent by
the chief financial officer of the Company.


 


Secured Intercreditor Period means the period from the Commencement Date
up to and including the earlier of:


 


(a)                                  the Term Date; and


 


(b)                                 the date of notification of a Declared
Default by the Intercreditor Agent.


 

















 


Secured Intra Group Loan means a loan made by a member of the Group
which is or, in accordance with the Security Principles is intended to be,
subject to a Security Document.


 


Securitisation Programmes means each of the securitisation programmes
referred to under the heading “Securitisation Programmes” in Schedule 3
existing at the date of this Agreement.


 


Security Agent means the security agent appointed pursuant to the Security Sharing
Agreement.


 


Security Document means any document entered into by a member of the Group with the Security
Agent in an agreed form evidencing or creating a Security Interest over any of
its assets in accordance with the Agreed Security Principles.


 


Security Interest means any:


 


(a)                                  hypothèque, nantissement,
privilège, cession de créance à titre de garantie par bordereau
Dailly, “gage-espèces” or any sûreté
réelle or droit de rétention;


 


(b)                                 mortgage, pledge, lien, charge, assignment by
way of security or for the purpose of providing security, hypothecation, right
in security, security interest or (to the extent applicable) trust arrangement
for the purpose of providing security; and


 


(c)                                  other security agreement or other arrangement
having the effect of providing security (including, without limitation, cash
collateral and the deposit of moneys or property with a person with the primary
intention of affording such person a right of set-off).


 


Security Sharing Agreement means the security sharing agreement to be
entered into between, among others, the Company and the Finance Parties in an
agreed form in accordance with the Agreed Security Principles.


 


Single Employer Plan means a single employer plan, as defined in Section 400(a)(15) of
ERISA, that is subject to Title IV of ERISA and that (a) is maintained for the
employees of the Company or any ERISA Affiliate or which is subject to the
minimum funding requirements of Section 302 of ERISA or Section 412 of the Code
or (b) was so maintained and in respect of which the Company or any ERISA
Affiliate could reasonably be expected to have liability under Section 4069 of
ERISA in the event such plan has been or were to be terminated.


 


Spot Rate of Exchange means the Intercreditor Agent’s spot rate of
exchange for the purchase of the relevant currency with another currency at or
about 11.00 a.m. on a particular day.


 


Subordination Agreement means the subordination agreement to be
entered into between, among others, certain Obligors, the Senior Agent (as
defined therein) and the Senior Creditors (as defined therein) in an agreed
form.


 


Subsidiary means an entity from time to time of which a person has direct or
indirect control or owns directly or indirectly more than fifty per cent (50%)
of the share capital or similar right of ownership.


 


Target Day means a day on which the Trans-European Automated Real-Time Gross
Settlement Express Transfer payment system is open for the settlement of
payments in Euro.


 


Tax
means any tax, levy, impost, duty or other charge or withholding of a similar
nature (including any related penalty or interest).


 


Tax Deduction means a deduction or withholding for or on account of Tax from a
payment under a Finance Document.


 


Term Date means the earlier of:


 


(a)                                  15th May, 2004; and


 


(b)                                 the date on which the Refinanced Facilities
are unconditionally refinanced in full,


 


Provided that:


 


(A)                              where the Rights Issue is launched prior to
15th May, 2004 but where the net proceeds are not received on or prior to 15th
May, 2004, (1) if the Rights Issue has been fully underwritten or subscribed on
or prior to 15th May, 2004 on 


 

















 


customary market terms, the
Term Date in paragraph (a) above will be extended to the expected date of
receipt of such net proceeds; or (2) if the Rights Issue has not been fully
underwritten or subscribed on or prior to 15th May, 2004, the Intercreditor
Agent (at the request of the Company or any Finance Party, but acting on the
instructions of the Majority Lenders) may agree to extend the Term Date in
paragraph (a) above to the expected date of receipt of such net proceeds; and


 


(B)                                in any event the Term Date may not be
extended to a date falling after 30th June, 2004.


 


Testing Date has the meaning given to it in Clause 10.1 (Financial covenant
definitions).


 


Transaction Document means:


 


(a)                                  a Finance Document;


 


(b)                                 any underwriting or subscription agreements
(or other contractual arrangements having a similar effect) entered into in
relation to the Rights Issue;


 


(c)                                  any sale and purchase agreements (or other
contractual arrangements having a similar effect) entered into in relation to
the Asset Disposal Programme;


 


(d)                                 each Facility Agreement; or


 


(e)                                  any other document designated as such in
writing by the Company and the Intercreditor Agent.


 


Unaffected Committed Facilities means the Unaffected Credit Facilities
listed under the heading “Committed Bank lines” in Schedule 3 (as refinanced
from time to time after the date of this Agreement).


 


Unaffected Credit Facility means any debt or commercial paper Facility
which is not an Affected Facility with banks or other institutions for
revolving loans, term loans, overdraft facilities, letters of credit and
guarantee facilities and excluding, for the avoidance of doubt, the USPP, the
High Yield Bonds, EMTN and any other bonds, notes or similar instruments.


 


USPP
means the USD 215,000,000 note purchase agreement and USD 75,000,000 note purchase
agreement each dated 30th July, 2002, as amended.


 


Withdrawal Liability has the meaning specified in Part I of Subtitle E of Title IV of
ERISA.


 


1.2                               Construction


 


(a)                                  In this Agreement, unless the contrary
intention appears, a reference to:


 


(i)                                     acting in concert has the meaning given to it in Article
L.233-10 of the French Code de Commerce;


 


(ii)                                  documents being in an agreed form means documents (A) in a form
previously agreed in writing by or on behalf of the Intercreditor Agent and the
Company, or (B) in a form substantially as set out in any Schedule to any
Finance Document, or (C) (if not falling within (A) or (B) above) in form and
substance satisfactory to the Intercreditor Agent (acting on the instructions
of the Lenders);


 


an amendment includes a supplement, novation,
restatement or re-enactment and amended
will be construed accordingly;


 


assets
includes present and future properties, revenues and rights of every
description;


 


an authorisation includes an authorisation,
consent, approval, resolution, license, exemption, filing, registration or
notarisation;


 


control means the power to direct the management and policies of an entity,
whether through the ownership of voting capital, by contract or otherwise;


 


disposal means a sale, transfer, grant, lease or other disposal, whether
voluntary or involuntary, including, without limitation, a capital contribution
and “dispose” will be treated accordingly;


 

















 


indebtedness includes any obligation (whether as principal or as surety) for the
payment or repayment of money;


 


a person includes any individual, company, corporation,
unincorporated association or body (including a partnership, trust, joint
venture or consortium), government, state, agency, organisation or other entity
whether or not having separate legal personality;


 


a regulation includes any regulation, rule, official directive,
request or guideline (whether or not having the force of law but if not having
the force of law, being of a type with which any person to which it applies is
accustomed to comply) of any governmental, intra-governmental or supranational
body, agency, department or regulatory, self-regulatory or other authority or
organisation;


 


the equivalent in other currencies or like
terms, unless otherwise agreed or the context otherwise requires, means in
relation to any amount expressed to be denominated in a currency other than
Euro, the equivalent thereof in Euro converted at the Spot Rate of Exchange for
the notional purchase of Euro with the currency concerned in the Paris foreign
exchange market at or about 11.00 a.m. on the day on which any such calculation
falls to be made;


 


(iii)                               a currency is a reference to the lawful
currency for the time being of the relevant country;


 


(iv)                              a Default being outstanding means that it has not been remedied or waived;


 


(v)                                 a provision of law is a reference to that
provision as extended, applied, amended or re-enacted and includes any
subordinate legislation;


 


(vi)                              a Clause, a Subclause or a Schedule is a
reference to a clause or subclause of, or a schedule to, this Agreement;


 


(vii)                           a person includes its successors, permitted
assigns and permitted transferees;


 


(viii)                        a Finance Document, Transaction Document or
another document is a reference to that Finance Document, Transaction Document
or other document as amended or supplemented including without limitation by
this Agreement;


 


(ix)                                a time of day is a reference to Paris time;


 


(x)                                   for the purposes of Clause 4.2(a), pro rata basis means the amount by which
any Existing Facility is repaid, prepaid, redeemed, repurchased, purchased,
defeased or otherwise reduced below its Exposure at the Calculation Point
expressed as a percentage of such Existing Facility; and


 


(xi)                                for the purposes of Clause 8.25 (United
States laws) and Clause 9.29 (United States laws) Federal Power Act means the United States Federal Power Act of
1920, as amended, holding company, affiliate
and subsidiary company have the
meanings given to them in the PUHCA, investment
company and controlled
have the meanings given to them in the United States Investment Company Act of
1940, as amended, public utility
has the meaning given to it in the Federal Power Act and PUHCA means The Limited States Public
Utility Holding Company Act of 1935, as amended.


 


(b)                                 Unless the contrary intention appears, a
reference to a “month” or “months” is a reference to a period starting on one
day in a calendar month and ending on the numerically corresponding day in the
next calendar month or the calendar month in which it is to end, except that:


 


(i)                                     if the numerically corresponding day is not a
Business Day, the period will end on the next Business Day in that month (if
there is one) or the preceding Business Day (if there is not);


 


(ii)                                  if there is no numerically corresponding day
in that month, that period will end on the last Business Day in that month; and


 


(iii)                               notwithstanding sub-paragraph (i) above, a
period which commences on the last Business Day of a month will end on the last
Business Day in the next month or the calendar month in which it is to end, as
appropriate.


 


(c)                                  Unless the contrary intention appears:


 


(i)                                     reference to a Party will not include that
party if it has ceased to be a Party under this Agreement;


 

















 


(ii)                                  an amount in Euro is payable only in the Euro
unit;


 


(iii)                               a term used in any other Finance Document or
in any notice given in connection with any Finance Document has the same
meaning in that Finance Document or notice as in this Agreement;


 


(iv)                              if there is an inconsistency between this
Agreement and any other Finance Document, this Agreement will prevail;


 


(v)                                 any obligation of an Obligor under the
Finance Documents which is not a payment obligation remains in force for so
long as any payment obligation is or may be outstanding under the Finance
Documents; and


 


(vi)                              the headings in this Agreement do not affect
its interpretation.


 


1.3                               Third Party Rights


 


(a)                                  Unless expressly provided to the contrary in
a Finance Document, a person who is not a party to a Finance Document may not
enforce any of its terms under the Contracts (Rights of Third Parties) Act
1999.


 


(b)                                 Notwithstanding any term of any Finance
Document, the consent of any third party is not required for any variation
(including any release or compromise of any liability under) or termination of
that Finance Document.


 


1.4                               Security Sharing Agreement
and Subordination Agreement


 


This Agreement is to be
entered into with the benefit of and subject to the Security Sharing Agreement
and the Subordination Agreement.


 


2.                                      CONDITIONS PRECEDENT


 


(a)                                  The obligations and acknowledgements of each
Finance Party to any other Party under this Agreement are subject to the
condition precedent that the Intercreditor Agent has notified each Party that
it has received the documents and other matters set out in Part 1 of Schedule 2
in form and substance satisfactory to the Intercreditor Agent or (as required)
the Lenders. Each Lender undertakes to confirm to the Intercreditor Agent in
writing that it is satisfied with the relevant documents referred to in Part 1
of Schedule 2, promptly upon receipt of the same in a form and substance
satisfactory to it.


 


(b)                                 Unless otherwise expressly stated, the
obligations and undertakings of the Obligors (but not the Lenders) under this
Agreement shall take effect on the date of this Agreement and continue in full
force and effect until (i) the Term Date; or (ii) if a Default is outstanding
on the Term Date until no Default is outstanding.


 


3.                                      SECURED INTERCREDITOR PERIOD


 


3.1                               Duration


 


The undertakings in this
Clause remain in force during the Secured Intercreditor Period.


 


3.2                               No Enforcement Action


 


Subject to Clause 3.1
(Duration) no Finance Party shall take any Enforcement Action in respect of any
default, event of default or termination event (howsoever described) under the
Affected Facilities except in respect of a Default or an Event of Default under
and in accordance with this Agreement as permitted under Clause 11.20
(Enforcement Action) and otherwise in accordance with the Security Sharing
Agreement (when entered into).


 


3.3                               No additional Security Interest


 


(a)                                  Subject to Clause 3.1 (Duration) no Finance
Party shall take any cash collateral, cash cover, guarantee, indemnity or
Security Interest in respect of any Affected Facility.


 


(b)                                 Paragraph (a) does not apply to:


 


(i)                                     an Existing Security Interest;


 


(ii)                                  any Security Interest permitted under Clause
9.7(b)(iv) or (v);


 

















 


(iii)                               the Security Documents;


 


(iv)                              any guarantee existing on the date of this
Agreement and the guarantee given by the Guarantor under this Agreement; and


 


(v)                                 subject always to the provisions of the
Security Sharing Agreement, the provision of Lessor Reduction and/or Derivative
Deposit.


 


3.4                               Novation


 


Subject to Clause 3.1
(Duration), no Finance Party shall assign, transfer or novate all or any part
of its rights or obligations under any Affected Facility unless it has procured
that the assignee, transferee or person to whom its rights and/or obligations
are novated, is a Lender under this Agreement or, on that assignment, transfer
or novation, becomes a Lender, in each case, under and in accordance with the
provisions of this Agreement.


 


4.                                      AFFECTED FACILITIES


 


4.1                               Duration


 


Each Obligor agrees to be
bound by and the Company shall ensure that each of its Subsidiaries and each
Borrowing Group Member performs and complies with, the undertakings set out in
this Clause. The undertakings in this Clause shall, subject to the provisions
of Clause 2(b) (Conditions precedent) and 7.2(b)(iii) remain in force until the
Term Date. Subject to Clause 15 (Amendments and waivers) the consent of all
Finance Parties is required for any amendment or waiver of the undertakings in
this Clause. Subject to Clause 15 (Amendments and waivers) any amendment or
waiver not agreed by a Finance Party in respect of the undertakings in this
Clause shall not be binding on that Finance Party.


 


4.2                               Pro rata repayments


 


(a)                                  If the Exposure owed to any person by the
Company, a Borrowing Group Member or other member of the Group under a Facility
(other than an Excluded Facility) is repaid or prepaid (whether or not a voluntary
or mandatory prepayment), redeemed, repurchased, purchased, defeased (whether
by way of legal or covenant defeasance) or otherwise reduced below the Exposure
of that person as at the Calculation Point, the Company and each Borrowing
Group Member shall and the Company will procure that each Borrowing Group
Member will ensure that the Exposure of each Lender under the Affected
Facilities to which that Borrowing Group Member is a party will be repaid,
prepaid (whether or not a voluntary or mandatory prepayment), redeemed,
repurchased, purchased (whether by way of legal or covenant defeasance) or
otherwise reduced simultaneously by that Borrowing Group Member on a pro rata basis.


 


(b)                                 Paragraph (a) does not apply to any reduction
in the Exposures of any person which arises solely as a result of:


 


(i)                                     any fluctuation in Exposures under any
Overdraft Facility;


 


(ii)                                  subject to and in accordance with Clause
4.3(c), any fluctuation in Exposures under any foreign exchange Facilities or
Derivative Instrument including the unwinding or replacement of any Derivative
Instrument or master agreement relating thereto prior to its original scheduled
expiry date provided that, except in the case of a replacement or unwinding
permitted under Clause 4.3(c)(iv), at the time of unwinding or replacement and
after the operation of any netting provision contained in that Derivative
Instrument or master agreement relating to that Derivative Instrument, the net
Exposure is “in the money” for the relevant member of the Group;


 


(iii)                               any fluctuation in exchange rates between the
Calculation Point and the Commencement Date;


 


(iv)                              any reimbursement of an amount paid by a
creditor in respect of its Exposure set out against its name in Schedule 3 for
guarantees or letter of credits;


 


(v)                                 for the avoidance of doubt, the making of any
Derivative Deposit or Lessor Reduction;


 


(vi)                              subject to and in accordance with Clause 3.4
(Novation), any person transferring, novating or assigning its Exposures to any
person under any Facility Agreement;


 


(vii)                           operation of law;


 

















 


(viii)                        any application of Excess Proceeds as defined
in and subject to and in accordance with clause 4.10 of the High Yield Bonds
and this Agreement;


 


(ix)                                subject to and in accordance with Clause
4.3(d), any letter of credit, confirmation or guarantee expiring at its
original maturity to the extent not required to be extended, replaced or
renewed by the relevant Borrowing Group Member;


 


(x)                                   subject to and in accordance with Clause
4.4(a), original scheduled payments of rent under leasing Facilities;


 


(xi)                                subject to and in accordance with Clause
4.4(b), any fluctuations in Exposures under the Securitisation Programmes;


 


(xii)                             prepayments under Lease Under Construction
Facilities in a maximum aggregate amount equal to €15,000,000 (or its
equivalent in other currencies);


 


(xiii)                          a mandatory prepayment required to be made
under a Lease Facility with the sale proceeds from a disposal of an asset
leased under that Lease Facility or a payment required to be made under a Lease
Facility following the exercise of a purchase option by the lessee thereunder
in respect of assets sold or contracted to be sold to a person outside the
Group;


 


(xiv)                         the transfer of Affected Facilities from
Rhodia Ying Long to Rhodia China Co. Limited; or


 


(xv)                            the transfer of the loan drawn under the
Primester Facility from Primester to the Company and to the extent Primester
has previously acceded to this Agreement as an Additional Obligor from the
Company to Primester.


 


(c)                                  Paragraph (a) does not apply to any reduction
in the Exposures of any person under any Facility which is made with the prior
written consent of the Requisite Lenders.


 


(d)                                 Paragraph (a) does not apply to any Facility
made to a Borrowing Group Member from the date on which the disposal of that
Borrowing Group Member occurs and that Borrowing Group Member shall no longer
be a Borrowing Group Member for the purposes of this Agreement from that date.


 


4.3                               Maintenance of Affected
Facilities


 


Subject to the provisions of
this Agreement, the Affected Facilities will be maintained at the level (and in
the currency) of Exposures as at the Calculation Point and otherwise on the
following basis:


 


	
   

  	
  (a)

  	
  (i)

  	
  each Affected Facility
  will, on maturity or roll-over dates, be renewed or rolled over in accordance
  with the terms of the relevant Affected Facility;

  



 


(ii)                                  any drawstop (howsoever described) under each
Affected Facility other than in respect of (A) an Event of Default referred to
in Clause 11.20(a) or (B) any Declared Default shall be suspended and have no
effect for such purpose;


 


(iii)                               in the case of a renewal of a maturity or a
roll-over under an Affected Facility, the new maturity or roll-over date shall
be renewed or rolled-over in accordance with Clause 4.6 (Renewals and
Roll-Overs); and


 


(iv)                              on any renewal or roll-over there will be no
change in the level or currency of Exposures under the relevant Affected
Facility as at the Calculation Point.


 


(b)                                 Undrawn or unutilised portions of any
Affected Facility in excess of the maximum Exposure as at the Calculation Point
in respect of any Affected Facility as set out in Schedule 3, whether,
committed or uncommitted, shall be permanently cancelled on the date of this
Agreement (save where necessary to maintain the level of principal Exposure
under the relevant Facility) and no fees or costs shall be payable on such
amounts with effect therefrom.


 


	
   

  	
  (c)

  	
  (i)

  	
  Existing foreign exchange
  facilities and Derivative Instruments will continue to be made available up
  to the maximum net Exposure of the Lender concerned as at the Calculation
  Point;

  



 


(ii)                                  Derivative Instruments that expire may be
extended or replaced by the same Obligor up to the maximum Exposure of the
applicable Lender as at the Calculation Point;


 

















 


(iii)                               payments on original scheduled due dates
under any foreign exchange facilities and Derivative Instruments will continue
to be made (including by way of netting if so provided in the relevant instrument)
in accordance with their terms; and


 


(iv)                              the Company will provide Derivative Deposit
in favour of the relevant Lender where required by that Lender and the amounts
of such collateral will be adjusted (upwards or downwards by the payment or
release of such collateral as the case may be) at the latest on the first
Business Day of each calendar month (commencing with January, 2004) PROVIDED
THAT where the aggregate amount of Derivative Deposit provided pursuant to this
Clause would (but for the limitations under this Agreement) otherwise have
exceeded €40,000,000 (or its equivalent in other currencies) then the Company:


 


(A)                              may substitute; or


 


(B)                                if required by that Lender shall unwind with
a corresponding payment as the case may be,


 


that or another Derivative
Instrument (at the cost and expense of the Company) so that the aggregate
amount of Derivative Deposit which the Company is to provide is equal to or
less than €40,000,000 (or its equivalent in other currencies).


 


Prior to any substitution or
unwinding of a Derivative Instrument, the cost and expense thereof and in the
case of an unwinding the corresponding payment shall be agreed between the
relevant Lender and the Company. In the absence of such agreement such amount
shall be determined by an independent third party expert appointed by the
Company and relevant Lender (at the cost of the Company) to act as an expert
and not as an arbitrator for such purpose.


 


	
   

  	
  (d)

  	
  (i)

  	
  Existing documentary
  letter of credit facilities, confirmation facilities, bond facilities and
  guarantee facilities will continue to be made available (in the same
  currency) up to the maximum Exposure of the applicable Lender under such
  facilities (as applicable) as at the Calculation Point subject to and in
  accordance with paragraph (d)(ii) below;

  



 


(ii)                                  if any letter of credit, confirmation or
guarantee expires it shall (A) if required by the relevant Borrowing Group
Member at any time during the Secured Intercreditor Period or (B) in the case
of an “extend or pay” letter of credit, confirmation or guarantee if the Lender
has the option to extend or pay, in each case, be extended (whether by way of
re-issue or replacement or otherwise) within the maximum Exposure of the
applicable Lender to a date no earlier than the Term Date;


 


(iii)                               any scheduled payment of interest, fees and
commission in respect of any letter of credit facilities, confirmation
facilities, bond facilities and guarantee facilities will continue to be made
in accordance with their terms; and


 


(iv)                              if any Lender makes a payment under any such
letter of credit facilities, confirmation facilities, bond facilities and
guarantee facilities in favour of the beneficiary, that Lender may in
accordance with the terms of that Affected Facility make a claim on the
relevant Borrowing Group Member for reimbursement of any sum paid or otherwise
treat any such sum paid by it as an advance of that amount to that member
bearing interest with a margin at the rate set out in Clause 4.5 (Interest,
fees and commission).


 


(e)                                  Affected Facilities that are Overdraft
Facilities will be made available and continue to be operated in accordance
with the net and gross limits (and in the currency) as at the Calculation Point
up to the maximum utilised amount under such Overdraft Facilities at the Calculation
Point.


 


(f)                                    This Clause 4.3 does not apply to any
Affected Facility which is made to a Borrowing Group Member from the date on
which the disposal of that Borrowing Group Member occurs and that Borrowing
Group Member shall no longer be a Borrowing Group Member from that date.


 


4.4                               Continuation of other
Facilities


 


(a)                                  Original scheduled payments of rent
(including for the avoidance of doubt the capital/principal element of any rent
or payment under Lease Facilities referred to in Schedule 3) shall continue to
be made in accordance with their terms under the relevant Lease Facilities.


 

















 


(b)                                 The Company shall maintain the Securitisation
Programmes and related back-up lines in force at the date of this Agreement in
accordance with their terms.


 


4.5                               Interest, fees and
commission


 


(a)                                  Subject to paragraphs (b) and (c), interest,
fees, commissions and costs and expenses accrued under any Facility will be
paid promptly as they fall due in accordance with that Facility. Any payment
shall be made by the relevant Obligor free and clear and without deduction for
or on account of any taxes.


 


(b)                                 Any amount advanced to any Obligor under any
Existing Facility in accordance with Clause 4.3(d)(iv) will be repayable at the
end of the Secured Intercreditor Period.


 


(c)                                  The aggregate of the margin over the
applicable base rate, facility fee, guarantee fee or commission applicable to
each Affected Facility, as the case may be (excluding Derivative Instruments,
the Lease Facilities and the Securitisation Programmes), from the date of this
Agreement will be the greater of (i) such margin, facility fee, guarantee fee
or commission applicable to each Affected Facility on the date of this
Agreement; and (ii) 3.05 per cent. per annum on the relevant Exposure and
otherwise in accordance with its terms.


 


(d)                                 The Company will pay to each Lender directly
on the date of the signing of this Agreement a flat fee calculated and payable
in accordance with the Fee Letter.


 


(e)                                  The Company shall pay to the Intercreditor
Agent (for its own account) agency fees in the manner and amount agreed in the
Fee Letter.


 


(f)                                    From the Commencement Date, the interest
period for each Affected Facility:


 


(i)                                     shall be rolled over for periods of one month
in accordance with its terms;


 


(ii)                                  where a roll-over date falls within one month
of 26th March, 2004, the next interest period shall be shortened to fall on
that date and will be monthly thereafter; and


 


(iii)                               after 26th March, 2004, the payment dates for
interest, any facility fee, guarantee fee or commission applicable to each
Affected Facility during the Secured Intercreditor Period will be re-aligned so
that due dates for their payment will fall on the same roll-over date.


 


(g)                                 Where a letter of credit or guarantee or
equivalent facility continues beyond the Term Date without the benefit of a
counter-guarantee under the Refinancing Facilities Agreement or any other
guarantee or cash deposit, the guarantee fee or commission referred to in
paragraph (c) above shall continue beyond the Term Date.


 


4.6                               Renewals and Roll-Overs


 


(a)                                  The final maturity date of any Affected
Facility which occurs during the Secured Intercreditor Period shall be extended
to a date corresponding to the Term Date.


 


(b)                                 Any roll-over date which occurs under an
Affected Facility during the Secured Intercreditor Period shall be adjusted to
occur on the date referred to in Clause 4.5(f).


 

















 


(c)                                  The final maturity date of each Refinanced
Facility shall be amended to occur on a date corresponding to the Term Date.


 


4.7                               Undertakings of the
Borrowing Group


 


Each Borrowing
Group Member shall and will procure that each of its Subsidiaries will ensure
that throughout the term of this Agreement and subject always to the Security
Sharing Agreement and the Subordination Agreement (when entered into):


 


(a)                                  subject to Clause 9.7(b) and Clause 9.16(d),
no Security Interest or guarantee indemnity or like commitment, in any such
case of whatever nature, shall be created or permitted to subsist by the
Company or any of its Subsidiaries in favour of any person under a Facility;


 


(b)                                 it shall not put or seek to put any creditor
under any Facility in a preferred position as against any Lender in particular,
but without limitation, any covenant or default provision more favourable to
the counterparty in respect of a Facility than those under this Agreement,
unless at the same time this Agreement is amended to substantially the same
extent and on substantially the same terms as provided to that counterparty;


 


(c)                                  no Borrowing Group Member shall make any
payment of or otherwise discharge any principal amount due or owing by it to
any other member of the Group or a Relevant Entity:


 


(i)                                     if in respect of a Secured Intra Group Loan
at any time; and


 


(ii)                                  if not in respect of a Secured Intra Group
Loan except:


 


(A)                              whilst no Default is outstanding if made in
accordance with the cash pooling arrangements existing at the date of this
Agreement or if made with respect to sales and purchases of goods, services or
trade receivables in its ordinary course of trading and which does not result
in a Default; and


 


(B)                                otherwise as permitted by and in accordance
with Clause 9.19 (Repayments of inter-group Financial Indebtedness),


 


unless otherwise agreed by
the Requisite Lenders; and


 


(d)                                 no amendment is made to, no interest amounts
payable are increased and no scheduled maturity or repayment dates are advanced
under any Facility on or after the date of this Agreement, in each case, except
as expressly set out herein.


 


4.8                               Restoration


 


If the Exposure of any
Lender reduces from its Exposure as at the Calculation Point other than in
accordance with this Agreement and the Security Sharing Agreement, the Lenders
will take such action as is necessary to ensure that the Exposure of that
Lender is restored as if reduced subject to and in accordance with this
Agreement and the Security Sharing Agreement.


 


4.9                               Acknowledgements by each
Party


 


(a)                                  Subject to Clauses 4.3(c) and 4.3(d) nothing
contained in this Agreement will oblige any Lender to make any further advance,
or extend any credit to, any member of the Group.


 


(b)                                 Except as amended or supplemented by this
Agreement, the Facility Agreements remain in full force and effect.


 


(c)                                  Each Finance Document and Facility Agreement
is subject to this Agreement. If there is any conflict between any other
Finance Document or Facility Agreement and this Agreement, this Agreement shall
prevail.


 


4.10                        Override


 


(a)                                  Clause 7 (Mandatory prepayment and
cancellation), Clause 8 (Representations and warranties), Clause 9
(Undertakings) and Clause 10 (Financial covenants) shall (i) take effect from
the date of this Agreement; and (ii) with effect from the Commencement Date and
throughout the Secured Intercreditor Period shall override any representations
and warranties or undertakings in the Affected Facility Agreements which relate
to the same or corresponding subject (but not otherwise).


 

















 


(b)                                 The terms of each Affected Facility
(including, in each case without limitation, the Affected Facility Agreements)
are only overridden to the extent set out in paragraph (a) above and in all
other respects the terms of each Affected Facility shall except as amended or
supplemented by or in accordance with another provision of this Agreement
otherwise remain in full force and effect.


 


(c)                                  Nothing in this Agreement shall override,
amend or replace any provision of an Affected Facility relating to the purpose
for which the relevant Affected Facility may be used.


 


(d)                                 No Finance Document nor any act or omission
of any Finance Party during the Secured Intercreditor Period will constitute a
waiver by that Finance Party of any rights or remedies available to it under
any Transaction Document to which it is a party and those rights and remedies
are reserved by the Finance Parties.


 


4.11                        Amendments to Affected
Facilities


 


(a)                                  If this Agreement is not fully effective with
respect to any Affected Facility under its governing law or the place of
incorporation of the applicable Borrowing Group Member this Agreement shall
operate as a separate or collateral contract between each of the parties to the
Affected Facility and the parties thereto shall (at the cost and expense of the
Company) and the Company shall procure that the applicable Borrowing Group
Member does promptly take all such reasonable steps and actions as may be necessary
to give full effect to the terms of this Agreement under such governing law or
place of incorporation including, without limitation, amendments to the terms
of the corresponding Affected Facility Agreements under and in accordance with
its governing law or place of incorporation.


 


(b)                                 Each Lender authorises its Facility Agent (if
any) to make any amendment required to be made pursuant to paragraph (a) above
under the Affected Facility Agreement to which it is a party.


 


4.12                        Negotiation in good faith


 


If an event or circumstance
occurs before 15th May, 2004 which could have a material impact (whether
positive or negative) on the appropriateness of the Company’s refinancing plan
as contemplated by the Rights Issue, the Asset Disposal Programme and the Refinancing
Facilities Term Sheet, as determined by the Majority Lenders and the Company,
without prejudice to their rights under the Transaction Documents, the Lenders
and the Company will negotiate in good faith with a view to agreeing
appropriate amendments to that refinancing plan.


 


4.13                        Term Date Prepayment


 


Each Obligor shall and the
Company shall ensure that each Borrowing Group Member shall ensure that an
amount equal to 5 per cent. of the Exposure under each of the Affected
Facilities listed under the heading “Prepayable” in Schedule 3 (other than the
Refinanced Facilities) and calculated by reference to the amount set out under
the heading “Exposure” in Schedule 3 is prepaid and cancelled on the Term Date.


 


5.                                      PAYMENTS


 


5.1                               Place


 


Unless otherwise expressly
stated, all payments by an Obligor or a Lender under the Finance Documents
shall be made to the Intercreditor Agent at such office or bank in a principal
financial centre of the country of the relevant currency as it may notify to
that Obligor or Lender for this purpose. Each Obligor and each Facility Agent
shall provide satisfactory evidence to the Intercreditor Agent of each and all
payments made under a Facility Agreement. Unless otherwise expressly stated in
this Agreement, all other payments shall continue to be made as provided in
that Affected Facility (as amended pursuant to this Agreement).


 


5.2                               Funds


 


Payments to the
Intercreditor Agent shall be made for value on the due date at such times and
in such funds as the Intercreditor Agent may specify to the Party concerned as
being customary at the time for the settlement of transactions in the relevant
currency in the place for payment.


 

















 


5.3                               Distribution


 


Where a sum is to be paid to
the Intercreditor Agent under the Finance Documents for another Party, the
Intercreditor Agent is not obliged to pay that sum to that Party until it has
established that it has actually received that sum. The Intercreditor Agent
may, however, assume that the sum has been paid to it in accordance with this
Agreement, and, in reliance on that assumption, make available to that Party a
corresponding amount. If the sum has not been made available but the
Intercreditor Agent has paid a corresponding amount to another Party, that
Party shall forthwith on demand by the Intercreditor Agent refund the
corresponding amount together with interest on that amount from the date of
payment to the date of receipt, calculated at a rate determined by the
Intercreditor Agent to reflect its cost of funds.


 


5.4                               Currency


 


(a)                                  A repayment or prepayment of any amount under
a Facility is payable in the currency in which the Facility is denominated on
its due date.


 


(b)                                 Interest is payable in the currency in which
the relevant amount in respect of which it is payable is denominated.


 


(c)                                  Amounts payable in respect of costs, expenses
and Taxes and the like are payable in the currency in which they are incurred.


 


(d)                                 Any other amount payable under the Finance
Documents is, except as otherwise provided in this Agreement, payable in Euro.


 


5.5                               Set-off and counterclaim


 


All payments made by an
Obligor under the Finance Documents shall be made without set-off or
counterclaim.


 


5.6                               Taxes


 


(a)                                  Each Obligor must make all payments to be
made by it under the Finance Documents without any Tax Deduction, unless a Tax
Deduction is required by law.


 


(b)                                 If a Tax Deduction is required by law to be
made on a payment by an Obligor or any Finance Party to a Finance Party under
the Finance Documents, the amount of the payment due from the Obligor will be
increased to an amount which (after making the Tax Deduction) leaves an amount
equal to the payment which would have been due if no Tax Deduction had been
required.


 


(c)                                  Any amount (including fees, costs and
expenses) payable under a Finance Document by an Obligor is exclusive of any
Tax (including value added tax) which might be chargeable in connection with
that amount. If any such tax is chargeable, the Obligor must pay to the Finance
Party (in addition to and at the same time as paying that amount) an amount
equal to the amount of that Tax.


 


5.7                               Non-Business Days


 


If a payment under the
Finance Documents is due on a day which is not a Business Day, the due date for
that payment shall instead be the next Business Day in the same calendar month
(if there is one) or the preceding Business Day (if there is not).


 


5.8                               Taux effectif global


 


In respect of a Borrowing
Group Member which is incorporated in France, for the purpose of Articles
L.313-1, L.313-2, R 313-1 and R 313-2 of the Consumer Code (Code de la Consommation), each Party
acknowledges that:


 


(a)                                  by virtue of certain characteristics of the
Facilities (including, without limitation, the variable interest rate and that
member’s right to select the duration of an interest period), the
re-calculation taux effectif global
in respect of a Facility for that member as a result of the adjustments
referred to in Clause 4.5 (Interest, fees and commission), above cannot be
calculated on the date of this Agreement, but that, an indicative calculation
of the taux effectif global,
based on assumptions as to the period rate (taux
de période) and the period (durée
de période), will be
set out in a letter from the Lender or its agent (as the case may be) to the
relevant Borrowing Group Member; and


 


(b)                                 that letter shall form part of the Facility
to which it applies.


 

















 


6.                                      NEW
GUARANTEE


 


6.1                               Guarantee


 


(a)                                  Subject to paragraph (b) below, the Guarantor
irrevocably and unconditionally:


 


(i)                                     guarantees to each Finance Party under the
Affected Facility Agreements to which such Finance Party is party, punctual
performance by each Borrowing Group Member which is party thereto of all its
payment obligations thereunder as amended or supplemented by this Agreement
(including without limitation pursuant to Clause 4.5 (whether or not such amendment
or supplement is effective));


 


(ii)                                  undertakes with that Finance Party that,
whenever that Borrowing Group Member does not pay any amount when due under or
in connection with that Affected Facility Agreement, it must immediately on
demand by the Intercreditor Agent pay that amount as if it were the principal
obligor; and


 


(iii)                               indemnifies that Finance Party immediately on demand against any cost,
loss or liability suffered by that Finance Party if any obligation guaranteed
by it is or becomes unenforceable, invalid or illegal or any amendment or
supplement of a payment obligation under an Affected Facility made or intended
to be made pursuant to this Agreement including without limitation Clause 4.5,
is not effective for any reason; the amount of the cost, loss or liability
under this indemnity will be equal to the amount that Finance Party would
otherwise have been entitled to recover.


 


(b)                                 The guarantee given by the Guarantor under
this Clause 6 is supplemental to and does not substitute or replace any other
guarantee existing at the date of this Agreement.


 


6.2                               Continuing guarantee


 


This guarantee is a
continuing guarantee and will extend to the ultimate balance of all sums
payable by each Borrowing Group Member under the Affected Facility Agreements to
which it is party, regardless of any intermediate payment or discharge in whole
or in part.


 


6.3                               Reinstatement


 


(a)                                  If:


 


(i)                                     any discharge (whether in respect of the
obligations of any Borrowing Group Member or any security for those obligations
or otherwise) is made in whole or in part; or


 


(ii)                                  any arrangement is made on the faith of any
payment, security or other disposition which is avoided or must be restored on
insolvency, liquidation or otherwise without limitation,


 


the liability of the Guarantor will continue as if the discharge or
arrangement had not occurred.


 


(b)                                 Each Finance Party may concede or compromise
any claim that any payment, security or other disposition is liable to
avoidance or restoration.


 


6.4                               Waiver of defences


 


The obligations of the
Guarantor under this Clause 6 will not be affected by any act, omission or
thing which, but for this provision, would reduce, release or prejudice any of
its obligations under this Clause 6 (whether or not known to it or any Finance
Party). This includes:


 


(a)                                  any time or waiver granted to, or composition
with, any Obligor or other person;


 


(b)                                 any release of an Obligor or other person
under the terms of any composition or arrangement;


 


(c)                                  the taking, variation, compromise, exchange,
renewal or release of, or refusal or neglect to perfect, take up or enforce,
any rights against, or security over assets of, any Obligor or other person;


 


(d)                                 any non-presentation or non-observance of any
formality or other requirement in respect of any instrument or any failure to
realise the full value of any security;


 


(e)                                  any incapacity or lack of power, authority or
legal personality of or dissolution or change in the members or status of an
Obligor or any other person;


 


(f)                                    any amendment (however fundamental) of a Transaction
Document or any other document or security;


 


(g)                                 any unenforceability, illegality or
invalidity of any obligation of any person under any Transaction Document or
any other document or security; or


 

















 


(h)                                 any insolvency or similar proceedings.


 


6.5                               Immediate recourse


 


The Guarantor waives any
right it may have of first requiring any Finance Party (or any trustee or agent
on its behalf) to proceed against or enforce any other right or security or
claim payment from any person before claiming from the Guarantor under this
Clause.


 


6.6                               Appropriations


 


Until all amounts which may
be or become payable by the Obligors under the Transaction Documents to the
Finance Parties have been irrevocably paid in full, each Finance Party (or any
trustee or agent on its behalf) may:


 


(a)                                  without affecting the liability of the
Guarantor under this Clause 6:


 


(i)                                     refrain from applying or enforcing any other
moneys, security or rights held or received by that Finance Party (or any
trustee or agent on its behalf) in respect of those amounts; or


 


(ii)                                  apply and enforce them in such manner and
order as it sees fit (whether against those amounts or otherwise); and


 


(b)                                 hold in an interest-bearing suspense account
any moneys received from the Guarantor or on account of the Guarantor’s
liability under this Clause 6.


 


6.7                               Non-competition


 


Unless:


 


(a)                                  all amounts which may be or become payable by
the Obligors under the Transaction Documents to the Finance Parties have been
irrevocably paid in full; or


 


(b)                                 the Intercreditor Agent otherwise directs,


 


the Guarantor will not, after a claim has been made or by virtue of any
payment or performance by it under this Clause 6:


 


(i)                                     be subrogated to any rights, security or
moneys held, received or receivable by any Finance Party (or any trustee or
agent on its behalf); or


 


(ii)                                  claim, rank, prove or vote as a creditor of
any Obligor or its estate in competition with any Finance Party (or any trustee
or agent on its behalf).


 


The Guarantor must hold in
trust for and immediately pay or transfer to the Intercreditor Agent for the
Finance Parties any payment or distribution or benefit of security received by
it (A) contrary to paragraphs (i) or (ii) above or (B) with respect to any
contribution or indemnity in respect of any payment made or moneys received on
account of the Guarantor’s liability under this Clause 6 or in respect of any
payment or distribution or security from or on account of any Borrowing Group
Member or any right of set-off as against any Borrowing Group Member, subject
to and in accordance with the Subordination Agreement and in accordance with
any directions given by the Intercreditor Agent.


 


6.8                               Termination


 


The provisions of this
Clause 6 shall continue in full force and effect and shall survive the
termination of this Agreement with respect to any Default which occurs on or
before the Term Date notwithstanding the expiry of the Secured Intercreditor
Period.


 


7.                                      MANDATORY PREPAYMENT AND CANCELLATION


 


7.1                               Prepayment Event


 


(a)                                  The Company will notify the Intercreditor
Agent promptly upon the occurrence of a Prepayment Event. Upon being notified
by the Company of a Prepayment Event, the Intercreditor Agent shall promptly
inform each Lender.


 

















 


(b)                                 Upon and at any time after having received
notice of a Prepayment Event from the Intercreditor Agent, each Lender, acting
through the Intercreditor Agent, may serve a notice of mandatory prepayment and
cancellation on the Company in respect of its Facility and:


 


(i)                                     on the date of the notice the commitment of
such Lender under its Facility shall be cancelled; and


 


(ii)                                  on the date falling 30 Business Days after
the date of service of such notice the Company shall prepay all participations
of such Lender in the Facility made to it in full through the Intercreditor
Agent together with any other amounts then due in connection with such
participations.


 


(c)                                  The Company and each Lender party to any
Derivatives Instruments or letter of credit facilities, confirmation
facilities, bond facilities and guarantee facilities will negotiate in good
faith with a view to providing to any such Lender the economic benefit of the
provisions of this Clause 7 if such Lender serves a notice on the Company for
such purpose.


 


(d)                                 If the Company seeks the consent of the
Lenders to a proposed Permitted Reorganisation, no Lender will unreasonably
delay in informing the Intercreditor Agent whether it consents to such proposed
Permitted Reorganisation.


 


7.2                               Disposals, equity and
capital market issues


 


(a)                                  Where a disposal is made by any member of the
Group of any Asset including a disposal made pursuant to the Asset Disposal
Programme, for which aggregate proceeds since the date of this Agreement exceed
€700,000,000 (or its equivalent in another currency), the Company must,
promptly on completion of that disposal, apply an amount equal to 50 per cent.
of the net disposal proceeds from any disposal which when aggregated with other
such disposal proceeds exceeds €700,000,000 (or its equivalent in other
currencies) in prepayment and/or cancellation of the principal amount of the
Affected Facilities in accordance with Clause 7.3 (Application of proceeds)
below.


 


(b)                                 (i)                                     Where the aggregate proceeds of a rights
issue launched by the Company prior to the Term Date exceed €300,000,000 (or
its equivalent in another currency), the Company must promptly apply an amount
equal to 25 per cent. of the net issuance proceeds of any issue in excess
of€300,000,000 in prepayment and/or cancellation of the principal amount of the
Affected Facilities in accordance with Clause 7.3 (Application of proceeds)
below.


 


(ii)                                  This paragraph (b) shall not apply in
relation to shares issued:


 


(A)                              in connection with employee share option
schemes; or


 


(B)                                to another member of the Group;


 


(iii)                               The provisions of this Clause 7.2(b) shall
survive termination of this Agreement and shall apply in respect of the net
proceeds of any such rights issue launched prior to the Term Date but which are
received after such date.


 


(c)                                  The Company must promptly upon receipt of the
same by any member of the Group apply an amount equal to 50 per cent. of the
net issuance proceeds of any issue of bonds or notes (including convertible
bonds or other equity-linked debt instruments), debt securities or other
capital markets instruments of any kind (whether publicly listed or privately
placed) by any member of the Group in prepayment and/or cancellation of the
principal amount of the Affected Facilities in accordance with Clause 7.3
(Application of proceeds) below.


 


(d)                                 In paragraphs (a), (b) and (c) above:


 


net disposal proceeds means any amount received by a member of the
Group as consideration for a disposal to a person which is not a Borrowing
Group Member, including the amount of any intercompany loan repaid to
continuing members of the Group and including any Financial Indebtedness
assumed or repaid, less all Taxes payable in the financial year in which the
disposal is effected or proceeds received and reasonable costs and expenses
incurred by members of the Group in connection with the disposal or receipt as
set out in reasonable detail in a certificate provided by the chief financial
officer of the Company; and


 


net issuance proceeds means any amount received by any member of
the Group less all Taxes and reasonable costs and expenses incurred by members
of the Group in connection with that receipt.


 

















 


7.3                               Application of proceeds


 


(a)                                  Where an amount (the Prepayment Amount) is to be applied in
prepayment and cancellation of the principal amount of the Affected Facilities
in accordance with Clauses 7.1 (Prepayment Event) and 7.2 (Disposals, equity
and capital market issues) above, the Company shall (subject to paragraphs (b)
and (c) below) prepay and/or cancel the principal amount of each such Affected
Facility in accordance with paragraph (d) below in an amount equal to that
Affected Facility’s Relevant Proportion of the Prepayment Amount on the day on
which the obligation under this Clause 7.3 to prepay and cancel arises.


 


(b)                                 Where the Prepayment Amount relates to net
disposal proceeds from the disposal of shares in a Borrowing Group Member (the Disposed Group Member), the Company must
ensure that the Borrowing Group Members apply that amount in prepayment and
cancellation pro rata according
to their respective Relevant Proportions of the Affected Facilities (other than
an Affected Facility made to that Disposed Group Member). For the purposes of
this Clause 7, any Facility made to a Disposed Group Member shall be deemed not
to be an Affected Facility on and following the date on which the disposal of
the Disposed Group Member occurs and the Disposed Group Member shall no longer
be a Borrowing Group Member from such date.


 


(c)                                  Where the Prepayment Amount relates to net
disposal proceeds from the disposal of an asset (other than shares in a
Borrowing Group Member), the Company must apply, and must ensure that the
Borrowing Group Members apply, an amount equal to such net disposal proceeds in
prepayment and cancellation pro rata
according to their respective Relevant Proportions of the Affected Facilities.


 


(d)                                 Any amount required by this Clause 7.3 to be
applied in prepayment and cancellation of an Affected Facility must be applied
by the Company to that Affected Facility (in accordance with its terms) first
in prepayment and cancellation of the principal amount outstanding under that
Affected Facility (if any) and second to any other amount in permanent
prepayment and cancellation thereof and thirdly in permanent cancellation of
undrawn amounts (if any) under that Affected Facility. Where the Company
prepays an amount outstanding under an Affected Facility pursuant to this
Clause it must at the same time permanently cancel the commitments of the
Lenders under that Affected Facility which correspond to the amount prepaid.


 


(e)                                  Any amount required by this Clause 7.3 to be
applied in prepayment and cancellation of the principal amount of an Affected
Facility and which is paid to or for the benefit of the relevant Lender shall,
for the purposes of this Agreement and irrespective of any other appropriation
of that amount by a Lender in connection with that Affected Facility, be taken
as having reduced that principal amount pro
tanto.


 


(f)                                    Where an amount is to be applied under this
Clause 7.3 in prepayment of any amount outstanding under the Affected
Facilities, unless the date on which the payment is to be made by the Company
is the last day of an interest period (as defined in the relevant Affected
Facility Agreement), that amount shall be paid through the Intercreditor Agent
into an interest bearing blocked and secured account in France in the name of
the Security Agent or the Intercreditor Agent. The Company irrevocably
authorises the Intercreditor Agent to apply any amount deposited with it under
this paragraph (f) towards prepayment of the Affected Facilities on the last
day of the relevant interest period (as defined in the relevant Affected
Facilities Agreement) or earlier at the discretion of the Intercreditor Agent.


 


(g)                                 For the purposes of this Clause 7.3, a
contingent claim of a Lender under an Affected Facility with respect to any
bond, letter of credit, guarantee or similar instrument is prepaid by the
Company providing cash cover in an interest bearing blocked and secured account
in the name of the Security Agent or the Intercreditor Agent in respect of that
claim to that Lender.


 


8.                                      REPRESENTATIONS AND WARRANTIES


 


8.1                               Representations and
warranties


 


Each Obligor makes the
representations and warranties set out in this Clause 8 in respect of itself
and each of its Subsidiaries to each Finance Party. In addition, the Company makes
the representations and warranties set out in this Clause 8 in respect of
itself and each Borrowing Group Member to each Finance Party.


 


8.2                               Status


 


(a)                                  It is a limited liability company, duly
incorporated and in good standing and validly existing under the laws of the
jurisdiction of its incorporation; and


 


(b)                                 it has the power to own its assets and carry
on its business as it is being conducted.


 

















 


8.3                               Powers and authority


 


It has the power to enter
into and perform, and has or will have taken at the relevant time all necessary
action to authorise the entry into, performance and delivery of, the
Transaction Documents and the Refinancing Facilities Term Sheet to which it is
or will be a party and the transactions contemplated by those documents.


 


8.4                               Legal validity


 


Each Transaction Document
and the agreements relating to the Refinancing Facilities Term Sheet to which
it is or will be a party constitutes, or when executed in accordance with its
terms will constitute, its legally binding, valid and enforceable obligation.


 


8.5                               Non-conflict


 


The entry into and
performance by it of, and the transactions contemplated by, the Transaction
Documents and the Refinancing Facilities Term Sheet do not and will not
conflict with:


 


(a)                                  any law or regulation or judicial or official
order; or


 


(b)                                 its or any of its Subsidiaries’
constitutional documents; or


 


(c)                                  any document which is binding upon it or any
of its or its Subsidiaries’ assets.


 


8.6                               No Default


 


(a)                                  No Default is outstanding on the date of this
Agreement or the Commencement Date and thereafter no Event of Default is
outstanding.


 


(b)                                 No event or circumstance is outstanding which
constitutes (or, with the giving of notice, lapse of time, determination of
materiality or the fulfilment of any other applicable condition or any
combination of the foregoing, might constitute) a default, termination event or
early prepayment event under any document which is binding on it or any of its
Subsidiaries.


 


(c)                                  Paragraphs (a) and (b) do not apply to
Defaults or events or circumstances the full details of which have been
notified in writing to the Intercreditor Agent and the Lenders prior to the
date of this Agreement.


 


8.7                               Authorisations


 


All authorisations required
by it or desirable in connection with the entry into, performance, validity and
enforceability of, and the transactions contemplated by, the Transaction
Documents and the implementation of the Refinancing Facilities Term Sheet, the
Asset Disposal Programme and the Rights Issue have been, or will be when necessary,
obtained or effected (as appropriate) and are, or will be when obtained or
effected, in full force and effect.


 


8.8                               Title


 


It and each member of the
Group has good title to, or valid leases of, or is otherwise entitled to use
all material assets necessary to conduct its business as it is conducted at the
date of this Agreement.


 


8.9                               Litigation


 


(a)                                  No litigation, arbitration or administrative
proceedings are current or, to its knowledge, pending or threatened against it
on the date of this Agreement and the Commencement Date which have or could
reasonably be expected to involve a claim or related claims in excess of
€15,000,000 (or its equivalent in other currencies) and thereafter which have
or could reasonably be expected to have a Material Adverse Effect.


 


(b)                                 Paragraph (a) does not apply to proceedings
the full details of which have been provided to the Intercreditor Agent.


 


8.10                        Pari Passu Ranking


 


Its obligations under the
Finance Documents rank and will rank at least pari
passu with all its other unsecured and unsubordinated obligations
except for obligations mandatorily preferred by law applying to companies
generally.


 

















 


8.11                        Taxes on payments


 


All amounts payable by each
Obligor under the Finance Documents can be made free and clear of and without
deduction for or on account of any Tax.


 


8.12                        Stamp duties


 


No stamp or registration
duty or similar taxes or charges are payable in its jurisdiction of
incorporation in respect of any Finance Document.


 


8.13                        Immunity


 


(a)                                  The execution by each Obligor of each Finance
Document constitutes, and its exercise of its rights and performance of its
obligations under each Finance Document will constitute, private and commercial
acts done and performed for private and commercial purposes; and


 


(b)                                 no Obligor will be entitled to claim immunity
from suit, execution, attachment or other legal process in any proceedings
taken in its jurisdiction of incorporation in relation to any Finance Document.


 


8.14                        No adverse consequences


 


(a)                                  It is not necessary under the laws of its
jurisdiction of incorporation:


 


(i)                                     in order to enable any Finance Party to
enforce its rights under any Finance Document; or


 


(ii)                                  by reason of the execution of any Finance
Document or the performance by it of its obligations under any Finance Document,


 


that any Finance Party
should be licensed, qualified or otherwise entitled to carry on business in its
jurisdiction of incorporation; and


 


(b)                                 no Finance Party is or will be deemed to be
resident, domiciled or carrying on business in its jurisdiction of
incorporation by reason only of the execution, performance and/or enforcement
of any Finance Document.


 


8.15                        Jurisdiction/governing law


 


(a)                                  Each Obligor’s:


 


(i)                                     irrevocable submission under Clause 24
(Jurisdiction) to the jurisdiction of the courts of England and the United
States;


 


(ii)                                  agreement that this Agreement is governed by
English law; and


 


(iii)                               agreement not to claim any immunity to which
it or its assets may be entitled,


 


are legal, valid and binding
under the laws of its jurisdiction of incorporation; and


 


(b)                                 any judgement obtained in England or in the
United States will be recognised and be enforceable by the courts of its
jurisdiction of incorporation.


 


8.16                        Security Interests and
guarantees


 


(a)                                  It is the legal and beneficial owner of the
property which it purports to charge pursuant to the Security Documents. No
Security Interests, third party rights, options, claims and competing interests
whatsoever exist over any of its assets other than as permitted by Clause 9.7
(Negative pledge).


 


(b)                                 The Security Interests granted or intended to
be granted under the Security Documents constitute first ranking security in
favour of the Finance Parties.


 


(c)                                  The guarantees given by any Borrowing Group
Member in respect of an Affected Facility continue in full force and effect
with respect to the Affected Facilities as supplemented by this Agreement.


 

















 


8.17                        Environmental matters


 


It has obtained any and all
Environmental Licences required for the carrying on of its business as
currently conducted and is in compliance in all material respects with (a) the
terms and conditions of such Environmental Licences and (b) all other
applicable Environmental Law which in each case, if not complied with, has, or
could reasonably be expected to have a Material Adverse Effect.


 


8.18                        Financial Statements and
Business Plan


 


(a)                                  The consolidated financial statements of the
Company most recently delivered to the Intercreditor Agent (which, at the date
of this Agreement, are the Original Financial Statements):


 


(i)                                     have been prepared in accordance with
accounting principles and practices generally accepted in its jurisdiction of
incorporation, consistently applied; and


 


(ii)                                  give a true and fair view of its financial
condition (consolidated, if applicable) as at the date to which they were drawn
up,


 


(b)                                 There has been no material adverse change in
the consolidated financial condition of the Group since the date of the
Original Business Plan.


 


(c)                                  The projections and forecasts contained in
the Business Plan most recently delivered to the Intercreditor Agent were made
in good faith and are based on reasonable assumptions and such Business Plan
does not as at its date omit any projections or forecasts which would make that
Business Plan misleading.


 


8.19                        Information


 


(a)                                  (Unless the Company has notified the
Intercreditor Agent (which shall notify the Lenders) in writing to the contrary
prior to the date of this Agreement, correcting the relevant inaccuracy or lack
of completeness) all written information (other than the Business Plan) (and
including all reports) provided to the Co-ordinating Committee or any other
Finance Party by or on behalf of an Obligor prior to the date of, and in
connection with, this Agreement (the Information)
was true, complete and accurate in all material respects as at the date it was
supplied.


 


(b)                                 All expressions of opinion contained in the
Information were made after careful consideration and were believed by the
Company or a Borrowing Group Member to be reasonable as at the date at which
they were stated to be given.


 


(c)                                  The financial projections contained in the
Information were prepared on the basis of assumptions believed by the Company
or a Borrowing Group Member to be reasonable and prudent as at the date at
which they were stated to be given.


 


(d)                                 Save as otherwise disclosed on or before the
date of delivery of the Information nothing has occurred since the date of that
Information (or, if applicable, the date of any factual information contained
therein as referred to therein) which, if disclosed, would make that
Information untrue or misleading in any material respect.


 


8.20                        Existing Facilities


 


(a)                                  The details in Schedule 3 given in relation
to each Existing Facility are, as at the date of this Agreement or, in the case
of the Exposures, the Calculation Point, true, accurate and complete.


 


(b)                                 Schedule 3 identifies each agreement under
which any member of the Group or Relevant Entity can incur or has outstanding
Financial Indebtedness or to which there is recourse in respect of Financial
Indebtedness to any Borrowing Group Member in each case on the date of this
Agreement.


 


8.21                        Asset Disposal Programme and
Rights Issue


 


The Company has no reason to
believe that the Asset Disposal Programme and Rights Issue cannot be completed
in full in accordance with the timetable applicable thereto and that any
authorisation or consent necessary for the disposal of an asset referred to in
the Asset Disposal Programme or for the launch and implementation of the Rights
Issue will not be forthcoming in time to allow that disposal or Rights Issue to
be implemented in accordance with that timetable.


 

















 


8.22                        Inter-Company Indebtedness


 


The list of Inter-Company
loans made to or by each Obligor provided to the Intercreditor Agent pursuant
to this Agreement, being on the date of this Agreement the list set out in
Schedule 7 (Inter Company Loans), is complete and correct in all material
respects as at its date.


 


8.23                        Solvency of Obligors


 


(a)                                  No proceedings of any nature are current or,
to its knowledge, pending or threatened, for the winding-up or dissolution
(other than a solvent winding up or dissolution) of, or in respect of any
insolvency proceeding of any nature relating to any Obligor or each of its
Subsidiaries.


 


(b)                                 It has not defaulted on any of its payment
obligations under any Facility and the Obligors and each of its Subsidiaries
are in a position to meet their respective scheduled payments as they fall due.


 


(c)                                  In relation to each Obligor (other than
Primester in the case of paragraphs (i) and (ii) below) and its Subsidiaries
incorporated or organised in the United States of America (on a consolidated
basis):


 


(i)                                     the aggregate amount of its debts (including
its obligations (if any) under the Finance Documents and the Facility
Agreements) is less than the aggregate value (being the lesser of fair present
valuation and present fair saleable value) of its assets (which for, avoidance
of doubt, include, without limitation, all rights of indemnification,
contribution and subrogation);


 


(ii)                                  its capital is not unreasonably small to
carry on its business as it is being conducted;


 


(iii)                               it did not incur (on the date incurred) and
will not incur, debts beyond its ability to pay as they mature; and


 


(iv)                              it has not made a transfer or incurred any
obligation under any Finance Document or Facility Agreement with the intent to
hinder, delay or defraud any of its present or future creditors.


 


Terms used in this paragraph
(c) have the meanings given to them in the United States Bankruptcy Code of
1978, as amended, and applicable fraudulent conveyance laws in the United
States of America.


 


8.24                        Group Structure Chart


 


As at the date of this
Agreement, the Group Structure Chart describes the corporate ownership
structure of all members of the Group and the Borrowing Group and is true,
complete and correct in all material respects.


 


8.25                        United States laws


 


(a)                                  It is not:


 


(i)                                     a holding company, an affiliate of a holding
company or a subsidiary company of a holding company within the meaning of, or
otherwise subject to regulation under PUHCA;


 


(ii)                                  a public utility, or subject to regulation,
under the Federal Power Act;


 


(iii)                               an investment company or a company controlled
by an investment company; or


 


(iv)                              subject to regulation under any United States
Federal or State law or regulation that limits its ability to incur or
guarantee indebtedness.


 


(b)                                 ERISA


 


(i)                                     No ERISA Event that could reasonably be
expected to have a Material Adverse Effect has occurred or is reasonably
expected to occur with respect to any Plan.


 


(ii)                                  The present value of the benefit liabilities
under each Plan, as determined for the purposes of Schedule B (Actuarial
Information) to such Plan’s most recently completed annual report (Form 5500
Series) that has been filed with the required United States governmental
agencies, which Schedule B is complete and accurate in all material respects,
did not, as of the date of such valuation, exceed the fair market value of the
assets of such Plan by an amount that, when aggregated with any such excess
under any other Plan, could reasonably be expected to have a Material Adverse
Effect, and since the date of such valuation there has been no material adverse
change in such funding status that, when aggregated with any such change with
respect to any other Plan, could reasonably be expected to have a Material
Adverse Effect.


 

















 


(iii)                               Except as could not reasonably be expected to
have a Material Adverse Effect, neither it nor any ERISA Affiliate has incurred
or is reasonably expected to incur any Withdrawal Liability to any
Multiemployer Plan.


 


(iv)                              Except as could not reasonably be expected to
have a Material Adverse Effect, neither it nor any ERISA Affiliate has been
notified by the sponsor of a Multiemployer Plan that such Multiemployer Plan is
in reorganisation or has been terminated, within the meaning of Title IV of
ERISA, and no such Multiemployer Plan is reasonably expected to be in
reorganisation or to be terminated, within the meaning of Title IV of ERISA.


 


8.26                        Times for making
representations and warranties


 


The representations and warranties set out in this Clause 8:


 


(a)                                  are made by each Obligor on the date of this
Agreement; and


 


(b)                                 are deemed to be repeated by each Obligor on
the Commencement Date with reference to the facts and circumstances then
existing; and


 


(c)                                  except those made under Clause 8.6(b) (No
Default), Clause 8.8 (Title), Clause 8.11 (Taxes on payments), Clause 8.12
(Stamp duties), Clause 8.18(c) (Financial Statements and Business Plan), Clause
8.19 (Information), Clause 8.20 (Existing Facilities), Clause 8.21 (Asset
Disposal Programme and Rights Issue), Clause 8.23 (Solvency of Obligors) and
Clause 8.24 (Group Structure Chart) are deemed to be repeated on each roll-over
date determined in accordance with Clause 4.6 (Renewals and Roll-Overs) and in
the case of Clause 8.18(c) (Financial Statements and Business Plan), on each
date that a Business Plan is delivered after the Commencement Date, and in the
case of Clause 8.22 (Inter-Company Indebtedness) on each date that a list of
Inter-Company loans referred to therein is delivered after the Commencement
Date, in each case, with reference to the facts and circumstances then
existing.


 


9.                                      UNDERTAKINGS


 


9.1                               Duration


 


The undertakings in this
Clause 9 remain in force from the date of this Agreement until (i) the Term
Date; or (ii) if a Default is outstanding on the Term Date, until no Default is
outstanding.


 


9.2                               Financial information


 


(a)                                  The Company shall supply or procure that the
relevant member of the Group supplies to the Intercreditor Agent in sufficient
copies for the Lenders:


 


(i)                                     as soon as the same are available (and
subject to paragraph (B) below in any event within 60 days of the end of its
respective financial years):


 


(A)                              the audited consolidated financial statements
of the Company for the financial year; and


 


(B)                                the audited financial statements of each
Borrowing Group Member to the extent the same are required to be supplied under
the Facility Agreement to which it is party, subject to and in accordance with
its terms;


 


(ii)                                  as soon as the same are available (and in any
event with 60 days of the end of its respective financial half-years) the
revised consolidated financial statements of the Company and to the extent the
same are required to be supplied under the Facility Agreement to which it is
party, a Borrowing Group Member for that half-year;


 


(iii)                               as soon as the same are available (and in any
event within 60 days of the end of each of its respective financial quarters)
the consolidated financial statements of the Company and to the extent the same
are required to be supplied under the Facility Agreement to which it is party,
a Borrowing Group Member for that financial quarter;


 


(iv)                              as soon as they become available (and in any
event within 30 days of the end of each calendar month) a copy of its
management accounts for that calendar month which shall contain a profit and
loss statement and cashflow and liquidity;


 

















 


and


 


(v)                                 in respect of each Relevant Entity:


 


(A)                              as soon as the same are available (and in any
event within 120 days of the end of each financial year of each Relevant
Entity) the audited consolidated financial statements of that Relevant Entity
for that financial year; or


 


(B)                                if the audited consolidated financial
statements referred to in paragraph (A) above are not prepared by a Relevant
Entity, as soon as the same are available (and in any event within 60 days of
the end of each financial year of that Relevant Entity) the financial
statements of that Relevant Entity for that financial year; and


 


(C)                                provided the same are prepared by a Relevant
Entity and the Company is entitled to receive them, as soon as the same are
available (and in any event within 45 days of the end of each financial half
year of each Relevant Entity) the financial statements (consolidated if prepared)
of that Relevant Entity for that half year.


 


(b)                                 Subject to paragraph (c) below, the Company
shall ensure that:


 


(i)                                     each set of financial statements delivered by
it pursuant to paragraphs (a)(i) to (a)(iv) above:


 


(A)                              is prepared in accordance with accounting
principles and practices generally accepted in France consistently applied;


 


(B)                                shall give a true and fair view of the
financial condition of the Group as at the end of the period to which those
financial statements relate and of the results of its operations during that
period; and


 


(C)                                is (in the case of the financial statements
referred to in paragraph (a)(i)(A) above) audited by an internationally
recognised independent qualified firm of auditors.


 


(c)                                  The Company shall ensure that each set of
financial statements delivered pursuant to paragraph (a)(v) above is prepared
in accordance with either:


 


(i)                                     accounting principles and practices generally
accepted internationally if, in the place of establishment or incorporation of
the Relevant Entity concerned there is a legal requirement to do so; or


 


(ii)                                  if no such requirement exists, accounting
principles and practices generally accepted in the place of establishment or
incorporation of the Relevant Entity concerned,


 


in each case consistently applied
and shall give a true and fair view of the financial condition of the Relevant
Entity to which they relate as at the end of the period to which those accounts
relate and of the results of its operations during that period.


 


(d)                                 Together with each set of financial
statements delivered under paragraph (a)(i)(A) above, the Company shall deliver
a Compliance Certificate signed by its statutory auditors setting out in
reasonable detail (to the Intercreditor Agent’s reasonable satisfaction)
computations in respect of the definitions used in and for the purposes of
establishing compliance with the financial covenants in Clause 10 (Financial
covenants) as at the Testing Date (as defined in Clause 10) to which the
financial statements with which the relevant Compliance Certificate was
delivered were made.


 


(e)                                  Together with each set of financial
statements delivered under paragraph (a)(ii) above, the Company shall deliver a
Compliance Certificate signed by its chief financial officer setting out in
reasonable detail computations in respect of the definitions used in and for
the purposes of establishing compliance with the financial covenants in Clause
10 (Financial covenants) as at the Testing Date (as defined in Clause 10) to
which those financial statements were made up.


 


(f)                                    Together with each set of financial
statements delivered under paragraph (a)(i) and (a)(ii) above, the Company
shall deliver to the Intercreditor Agent a certificate listing the Material
Subsidiaries as determined from those financial statements.


 


(g)                                 The Company shall supply the Intercreditor
Agent (in sufficient copies for the Lenders) with:


 


(i)                                     an update of the Business Plan validated by
Ernst & Young (to include an analysis and projections of liquidity and
cash) on 31st December, 2003 and quarterly thereafter in accordance with the
agreed scope of work;


 


(ii)                                  (A) as soon as the same are available and in
any event within 12 Business Days of the end of each calendar month, details of
the amounts of consolidated gross and net cash available to the Company and the
Exposures under the Facilities commencing with the calendar month ending 31st
December, 2003; and (B) shall use its best efforts to supply monthly liquidity
and cash flow forecasts for each calendar month including a 12-month rolling
forecast for the next twelve months commencing with the calendar month ending
30th April, 2004;


 

















 


(iii)                               as soon as the same are available and in any
event within 10 Business Days of the end of each calendar month, a list of all
Inter-Company loans made to or by each Obligor as at the end of that calendar
month;


 


(iv)                              such information, access to personnel and
other assistance as is necessary to enable the Finance Parties to monitor the
cash flow of the Group and compare it with the liquidity and cash flow
forecast; and


 


(v)                                 such other information in respect of any of
the Obligors as the Intercreditor Agent (acting on the instructions of the
Majority Lenders) may reasonably request.


 


(h)                                 Promptly on the supply to the Intercreditor
Agent of the annual financial statements for the financial year of 2003, the
Company shall ensure the availability of senior management of the Company for a
presentation to the Lenders.


 


9.3                               Information-miscellaneous


 


Each Obligor shall and the
Company shall ensure that each Borrowing Group Member will supply to the
Intercreditor Agent in sufficient copies for the Lenders:


 


(a)                                  all notices and documents dispatched by it to
its shareholders (or any class of them) or its creditors (or any class of them)
at the same time as they are dispatched;


 


(b)                               (i)                                       to the extent legally permissible, any
report, notice or statement made or issued to any regulatory authority or stock
exchange of an Obligor promptly upon making or issuing the report, notice or
statement; and


 


(ii)                                  where the report, notice or statement refers
to the Lenders, the Company shall where legally permissible, give the
Intercreditor Agent opportunity to comment on the report, notice or statement
prior to its making or issue;


 


(c)                                  promptly, a copy of any material notification
received from any rating agency in respect of the Company’s long term credit
rating;


 


(d)                                 promptly upon becoming aware of them, details
of any material litigation, arbitration or administrative proceedings which are
current, threatened or pending which it is or may become involved in; and


 


(e)                                  promptly, such further information in the
possession or control of any member of the Group regarding its financial
condition, structure, business and management as any Finance Party may
reasonably request.


 


9.4                               Notification of Default


 


(a)                                  The Company or relevant Obligor shall,
promptly upon becoming aware of the occurrence of the same, notify the
Intercreditor Agent of:


 


(i)                                     any Default in respect of it or its
Subsidiaries (and the steps, if any, being taken to remedy it); or


 


(ii)                                  any event or circumstance which constitutes
(or, with the giving of notice, lapse of time, determination of materiality or
the fulfilment of any applicable condition or any combination of the foregoing,
might constitute) a default, termination event or early prepayment event under
any document which is binding on it or any of its Subsidiaries.


 


(b)                                 The Intercreditor Agent will promptly notify
each Lender (or where appropriate each Facility Agent acting on behalf of a
Lender) of any such Default or event or circumstance upon receipt of
notification from the Obligor.


 


(c)                                  Promptly upon any request by the
Intercreditor Agent (acting in good faith) the Company must supply to the
Intercreditor Agent a certificate, signed by two of its authorised signatories
on its behalf, certifying that no Default is outstanding or, if a Default is
outstanding, specifying the Default and the steps, if any, being taken to
remedy it.


 

















 


9.5                               Authorisations


 


Each Obligor shall and the
Company shall ensure that each Borrowing Group Member will promptly:


 


(a)                                  obtain, maintain and comply with the terms
of; and


 


(b)                                 supply certified copies to the Intercreditor
Agent of,


 


any authorisation required
or desirable under any law or regulation to enable it to enter into or to perform
its obligations under, or for the performance, validity or enforceability of,
and the transactions contemplated by, any Transaction Document and the
implementation of the Asset Disposal Programme, the Rights Issue and the
Refinancing Facilities Term Sheet.


 


9.6                               Pari passu ranking


 


Each Obligor shall and the
Company shall ensure that each Borrowing Group Member will procure that its
obligations under the Finance Documents and the Affected Facility Agreements do
and will rank at least pari passu
with all its other present and future unsecured and unsubordinated obligations,
except for obligations mandatorily preferred by law applying to companies
generally.


 


9.7                               Negative pledge


 


(a)                                  No Obligor shall, and the Company shall
procure that no other member of the Group or a Borrowing Group Member will,
create or permit to subsist any Security Interest on any of its assets.


 


(b)                                 Paragraph (a) does not apply to:


 


(i)                                     Existing Security Interests as set out in
Part 1 of Schedule 4 (List of Existing Security Interests);


 


(ii)                                  any lien arising by operation of law in the
ordinary course of business and securing amounts not more than 30 days overdue;


 


(iii)                               any Security Interest over assets granted or
to be granted in favour of a Finance Party under a Security Document or under
or in accordance with Clause 7.3(g);


 


(iv)                              any Security Interest over assets other than
those identified in the Agreed Security Principles or referred to in paragraph
(iii) above, to the extent necessary in order to maintain, refinance, replace or,
to the extent permitted by this Agreement, incur new Financial Indebtedness up
to a maximum aggregate amount of €60,000,000 (or its equivalent in other
currencies); or


 


(v)                                 any Derivative Deposit or Lessor Reduction.


 


9.8                               Transactions similar to
security


 


(a)                                  No Obligor shall, and the Company shall
procure that no other member of the Group or a Borrowing Group Member will:


 


(i)                                     sell, transfer or otherwise dispose of any of
its assets on terms whereby it is or may be leased to or re-acquired or
acquired by a member of the Group or any of its related entities; or


 


(ii)                                  sell, transfer or otherwise dispose of any of
its receivables on recourse terms,


 


in circumstances where the
transaction is entered into primarily as a method of raising finance or of
financing the acquisition of an asset.


 


(b)                                 Paragraph (a) above does not apply to any
disposal of receivables made in respect of the existing Securitisation
Programmes with Limited Recourse only.


 


9.9                               Disposals


 


(a)                                  No Obligor shall, and the Company shall
procure that no other member of the Group or a Borrowing Group Member will,
either in a single transaction or in a series of transactions, whether related
or not, dispose of all or any part of its assets.


 


(b)                                 Paragraph (a) does not apply to:


 

















 


(i)                                     disposal of stock-in-trade, business
inventories, fixtures and fittings, furniture and other office equipment, made
in the ordinary course of business of the disposing entity;


 


(ii)                                  disposal of assets (other than shares) in
exchange for other assets comparable or superior as to type, value and quality;


 


(iii)                               disposal of assets (other than the business
of the Company) or shares as part of an intra-group re-organisation from one
Obligor to another Obligor on arms’-length terms, in each case, subject to and
in accordance with Clause 9.11 (Mergers, acquisitions and intra-group
re-organisations);


 


(iv)                              disposal of assets for cash in accordance
with the Asset Disposal Programme and other disposal of assets for cash where
50% of the net proceeds of any such disposal are applied in mandatory
prepayment and cancellation of the Affected Facilities subject to and in
accordance with Clause 7.2 (Disposals, equity and capital market issues) of
this Agreement;


 


(v)                                 disposal of assets made in respect of the
existing Securitisation Programmes with Limited Recourse only;


 


(vi)                              disposal for cash on a non-recourse basis of
VAT credits; or


 


(vii)                           transactions with the prior written approval
of the Majority Lenders.


 


9.10                        Change of
business/registered office


 


(a)                                  The Company shall procure that no substantial
change is made to the general nature or scope of the business of the Company or
the Group (taken as a whole) from that carried on at the date of this
Agreement.


 


(b)                                 The Company shall not change its place of
incorporation or registered head office to one outside the European Union.


 


9.11                        Mergers, acquisitions and
intra-group re-organisations


 


(a)                                  No Obligor shall, and the Company shall
procure that no other member of the Group or a Borrowing Group Member will
enter into any amalgamation, demerger, merger, reconstruction or
re-organisation otherwise than under an intra-group re-organisation involving
the transfer of assets (including of a business other than the business of the
Company) and/or shares provided that such intra-group re-organisation:


 


(i)                                     unless a Permitted Reorganisation, does not
involve the Company;


 


(ii)                                  does not affect any of its assets which are
or are intended to be subject to Security Interests granted in favour of the
Lenders or, to the extent that it does affect any such assets, substitute
Security Interests are granted over assets of a greater or equivalent value
prior to such intra-group re-organisation (together with legal opinions) in
each case in a form and substance satisfactory to the Majority Lenders;


 


(iii)                               does not or is not reasonably likely to
result in a Material Adverse Effect or a Default;


 


(iv)                              does not affect any of the rights or remedies
of the Lenders under the Finance Documents or the Affected Facility Agreements;
and


 


(v)                                 where it involves a Borrowing Group Member
(other than by way of a transfer of its shares), the Lender or Lenders party to
a Facility with that Borrowing Group Member, have provided their prior written
consent.


 


(b)                                 Save as allowed by paragraph (c) below,


 


(i)                                     each Obligor which is not a Joint Venture
Entity shall not;


 


(ii)                                  each Obligor which is a Joint Venture Entity
shall use its best efforts not to; and


 


(iii)                               the Company shall ensure that no member of
the Group will, and to the fullest extent within its power or control that no Joint
Venture Entity will,


 


acquire any assets or
business or make any investment in any business, shares or other securities.


 

















 


(c)                                  Paragraph (b) above shall not prevent:


 


(i)                                     acquisitions or investments made in the
ordinary course of trade;


 


(ii)                                  acquisitions with an aggregate consideration
in any financial year of the Group not in excess of €10,000,000 or its
equivalent;


 


(iii)                               acquisitions made with the prior consent of
the Intercreditor Agent (acting on the instructions of the Majority Lenders);
or


 


(iv)                              capital contributions made to Relevant
Entities or Joint Venture Entities by way of inter-company loan or share
capital provided that the aggregate amount of such contributions made since the
date of this Agreement less the aggregate amount of (A) contributions repaid
directly or indirectly to the Company; and (B) the amount of any dividend
distributed directly or indirectly to the Company with respect to that capital
contribution to the extent in excess of the dividends projected to be received
by the Company and Subsidiaries on a fully consolidated basis by reference to
the Original Business Plan does not exceed at any time € 50,000,000 (or its
equivalent in another currency), taking into account any capital contributions
made under Clause 9.16 (Lending and borrowing).


 


9.12                        Capital expenditure


 


No Obligor (except if a
Relevant Entity) shall and the Company shall procure that no other member of
the Group shall incur any tangible or intangible capital expenditure except
where such capital expenditure in aggregate does not exceed 110 per cent. per
annum of the aggregate amount of capital expenditure per annum set out in the
Business Plan.


 


9.13                        Insurance


 


Each Obligor shall and the
Company shall ensure that each Material Subsidiary and each Borrowing Group
Member insures its business and assets with insurance companies to such an
extent and against such risks as companies engaged in a similar business
normally insure.


 


9.14                        Maintenance of status


 


Each Obligor shall, and the
Company shall procure that each Material Subsidiary and each Borrowing Group
Member will:


 


(a)                                  do all such things as are necessary to
maintain its corporate existence; and


 


(b)                                 ensure that it has the right and is duly
qualified to conduct its business as it is conducted in all applicable
jurisdictions.


 


9.15                        Amendments to Facilities


 


(a)                                  No Obligor shall and the Company shall ensure
that no Borrowing Group Member will agree to amend, or seek a waiver of, any
term of any Facility or exercise any right to terminate or reduce any amount
available for drawing under any Facility Agreement.


 


(b)                                 Paragraph (a) does not apply to:


 


(i)                                     any term of any Facility preventing any
Obligor from complying with its obligations under this Agreement; or


 


(ii)                                  any agreement to extend the maturity of any
Facility; or


 


(iii)                               any amendment required to be made under the
terms of this Agreement including, without limitation, under Clause 9.21(a)
(Rights Issue and Other Matters).


 


9.16                        Lending and borrowing


 


(a)                                  Subject to paragraphs (b) and (c) below, no
Obligor shall and the Company shall ensure that no member of the Group or any
Borrowing Group Member will make any loans or provide any other form of credit
(including, without limitation, vendor credit) to any person.


 


(b)                                 Paragraph (a) does not apply to loans or any
other form of credit provided to an Obligor in accordance with the
Subordination Agreement when entered into and otherwise in accordance with its
cash pooling arrangements.


 

















 


(c)                                  Paragraph (a) does not apply to capital
contributions made to Relevant Entities or Joint Venture Entities by way of
inter-company loan or share capital provided that the aggregate amount of
contributions made by way of share capital or inter-company loan since the date
of this Agreement less the aggregate amount of (A) such contributions repaid
directly or indirectly to the Company; and (B) the amount of any dividend
distributed directly or indirectly to the Company with respect to that capital
contribution to the extent in excess of the dividends expected to be received
by reference to the latest Business Plan, does not exceed at any time €
50,000,000 (and after the Term Date, subject to and in accordance with the
Refinancing Facilities Agreement, €90,000,000), taking into account any capital
contributions made under Clause 9.11 (Mergers, acquisitions).


 


(d)                                 Subject to the provisions of Clause 9.17(c),
no Obligor shall and the Company shall ensure that no Borrowing Group Member
will give any guarantee or indemnity to or for the benefit of any person in
respect of any obligation of any other person or enter into any document under
which it assumes any liability of any other person except under the Existing
Facilities and this Agreement.


 


9.17                        Financial Indebtedness


 


The Company shall not and it
shall ensure that no member of the Group will and, to the fullest extent within
its power or control, no Relevant Entity shall incur any Financial Indebtedness
(including, without limitation, guarantees of joint venture entities) except:


 


(a)                                  Financial Indebtedness outstanding under the
Existing Facilities at the date of this Agreement and the Refinancing
Facilities Agreement;


 


(b)                                 Financial Indebtedness owed to another member
of the Group on the date of this Agreement and thereafter in accordance with
its cash pooling arrangements and in each case which is subordinated subject to
and in accordance with the Subordination Agreement when entered into;


 


(c)                                  refinancing of Financial Indebtedness under
Unaffected Credit Facilities (other than Unaffected Committed Facilities)
existing at the date of this Agreement up to a maximum aggregate amount of
€50,000,000 (or its equivalent in other currencies) by an Unaffected Credit
Facility with a final maturity date no earlier than both (A) the Term Date; and
(B) the final maturity of the refinanced Unaffected Credit Facility and on
terms which do not put or seek to put the creditor of the refinanced Unaffected
Credit Facility in a preferred position as against any Lender;


 


(d)                                 refinancing of Financial Indebtedness under
Unaffected Committed Facilities by Unaffected Credit Facilities (i) with a
final maturity date falling no earlier than (x) the Term Date; or (y) the final
maturity date of the refinanced Facility; and (ii) on terms that do not put or
seek to put the creditor of the refinanced Facility in a preferred position as
against any Lender as provided in Clause 4.7(b);


 


(e)                                  Financial Indebtedness incurred by the
Company under any Facility which is not an Existing Facility which does not or
could not be expected to have a Material Adverse Effect or result in a Default;


 


(f)                                    Financial Indebtedness in respect of
Overdraft Facilities that may fluctuate in accordance with their terms up to
the maximum Exposure under such overdraft facilities as at the Calculation
Point;


 


(g)                                 Financial Indebtedness in respect of any
issue of bonds, notes, debt securities or capital markets instruments, 50% of
the net proceeds of which are applied pursuant to Clause 7.2(c) in mandatory
prepayment and cancellation of the Affected Facilities; or


 


(h)                                 any other Financial Indebtedness incurred
after the date of this Agreement, by a Subsidiary of the Company or a Relevant
Entity, which at any time does not exceed a maximum aggregate amount of
€50,000,000 (or its equivalent in other currencies).


 


9.18                        Shares and dividends


 


(a)                                  The Company shall not:


 


(i)                                     convene a meeting of shareholders to consider
a resolution to make any distribution or pay any dividend, or other payment (in
cash or in kind) in respect of any of its share capital or any management fees
or charges in favour of its shareholders’ or its shareholders’ Affiliates; or


 

















 


(ii)                                  reduce, redeem, repurchase or retire any of
its share capital.


 


(b)                                 The Company shall (to the fullest extent
permitted by applicable law):


 


(i)                                     procure that no Material Subsidiary enters
into any arrangement or agreement which may restrict its ability to declare,
make or pay any dividend on or in respect of its share capital (or any class of
its share capital) or restrict its ability to distribute any dividend; and


 


(ii)                                  procure that each Material Subsidiary will to
the extent necessary to ensure that the Company has funds available to it to
service its payment obligations under the Finance Documents and the Facility
Agreements, declare, make and pay in cash dividends in respect of its shares or
reimburse intercompany loans unless doing so will prevent that Material
Subsidiary from being able to meet its payment obligations which are then due and
payable and provided that (A) no more than an aggregate amount equal to €
150,000,000 (or its equivalent in other currencies) shall be distributed by
Rhodia Inc. by way of dividend or reimbursement of intercompany loans on and
after the date of this Agreement with sale proceeds from disposals of its
assets and (B) such reimbursement of intercompany loans shall be made in
priority to any such distribution of dividends.


 


9.19                        Repayments of inter-group
Financial Indebtedness


 


Subject to Clause 4.7(c), no
Obligor shall and the Company shall ensure that no Borrowing Group Member will
prepay or repay any amounts of Financial Indebtedness owed to its shareholders
or any member of the Group except directly or indirectly (including via Rhodia
Finances and Rhodia Financial Services Inc.) to the Company and otherwise to
the extent permitted in the Subordination Agreement.


 


9.20                        No set-off


 


No Obligor shall and the
Company shall ensure that no Borrowing Group Member will exercise any right of
set-off or counterclaim against any person nor agree to or permit any set-off
to occur without the prior written consent of the Majority Lenders except for:


 


(a)                                  any right of set-off or consolidation of
accounts which is (i) contractual or arising as a matter of law; or (ii) pursuant
to legally binding netting arrangements in force on the date of this Agreement
in each case with any person outside the Group; or


 


(b)                                 to the extent expressly permitted by the
Subordination Agreement.


 


9.21                        Rights Issue and Other
Matters


 


(a)                                  The Company shall:


 


(i)                                     launch the Rights Issue by no later than 15th
May, 2004;


 


(ii)                                  initiate and implement the Asset Disposal
Programme (in accordance with the terms of the definition thereof);


 


(iii)                               use its best endeavours to execute the
Refinancing Facilities Agreement on or before 15th January, 2004 and shall in
any event enter into the Refinancing Facilities Agreement by 15th February,
2004;


 


(iv)                              use its best endeavours to execute amendments
to the USPP documents to allow it to implement the Agreed Security Principles
on or before the 15th January, 2004; and


 


(v)                                 use its best endeavours to amend the leases
not inconsistent with the Agreed Lease Amendment Principles prior to entering
into the Refinancing Facilities Agreement and in any event on or before 15th February,
2004.


 


(b)                                 The Company shall notify the Intercreditor
Agent promptly upon becoming aware of:


 


(i)                                     any failure to obtain or maintain any
authorisation, consent or other condition necessary for the disposal of an
asset referred to in the Asset Disposal Programme or the launch and
implementation of the Rights Issue in order to enable the Asset Disposal
Programme and the Rights Issue to be implemented; or


 


(ii)                                  of any decision by it not to implement the
Asset Disposal Programme or the Rights Issue.


 

















 


9.22                        Joint Ventures


 


No Obligor will, and the
Company will ensure that no other member of the Group or a Borrowing Group
Member will, enter into or acquire any interest in any new joint venture,
partnership or similar arrangement except where any such interest is held
through an entity incorporated with limited liability and does not result in or
could not reasonably be expected to result in a breach of any other provisions
of any Finance Document.


 


9.23                        Compliance with laws


 


Each Obligor shall and the Company
shall ensure that each Material Subsidiary and each Borrowing Group Member will
comply in all material respects with all applicable laws and regulations of any
governmental authority, whether domestic or foreign, having jurisdiction over
it or any of its assets, where failure to comply with any such laws or
regulations has, or could be expected to have, in each case in the reasonable
opinion of the Majority Lenders, a Material Adverse Effect.


 


9.24                        Compliance with
Environmental Laws and Indemnity


 


(a)                                  Each Obligor shall and the Company shall
ensure that each Material Subsidiary and each Borrowing Group Member will:


 


(i)                                     obtain any and all Environmental Licences
required for the carrying on of its business as currently conducted; and


 


(ii)                                  comply in all material respects with (i) the
terms and conditions of such Environmental Licences and (ii) all other
applicable Environmental Law which in each case, if not complied with, has, or
could be expected to have, in each case in the reasonable opinion of the Majority
Lenders, a Material Adverse Effect or result in any liability for the Finance
Parties in excess of €5,000,000 in aggregate.


 


(b)                                 The Company shall indemnify each Finance
Party and their respective officers, employees, agents and delegates (together
the Indemnified Parties) against
any cost or expense suffered or incurred by them (except if caused by their own
negligence or wilful default) which:


 


(i)                                     arises by virtue of any actual or alleged
breach of any Environmental Law (whether by any Obligor, an Indemnified Party
or any other person); or


 


(ii)                                  arises by virtue of the release or threatened
release of, or exposure to, any Dangerous Substance stored or handled upon,
transported from, or otherwise associated with, the past or present facilities
or operations of any Obligor or Group member.


 


Each Indemnified Party may
rely on this Clause 9.24 and enforce its terms under the Contracts (Rights of
Third Parties) Act 1999.


 


9.25                        Arm’s-length terms


 


No Obligor will, and each
Obligor will ensure that no member of the Group or a Borrowing Group Member
will, enter into any transaction with any person except on ordinary commercial
terms and on the basis of arm’s-length arrangements, or enter into any
transaction whereby any Obligor or member of the Group might pay more than the
ordinary commercial consideration for any purchase or acquisition or might
receive less than full commercial consideration for its services or products.


 


9.26                        Access


 


Upon the occurrence of an
Event of Default which is continuing, each Obligor shall and the Company shall
ensure that each Material Subsidiary and each Borrowing Group Member must allow
any one or more representatives of the Intercreditor Agent and/or accountants
or other professional advisers appointed by the Intercreditor Agent (at the
Company’s risk and expense) to have access during normal business hours to the
assets, books and records of that member of the Group and to inspect the same.


 


9.27                        Security and Subordination


 


The Obligors shall and the
Company shall ensure that each relevant member of the Group will at their own
expense:


 


(a)                                  enter into the Security Sharing Agreement and
the Security Documents with the Finance Parties and other creditors under
Facilities which are to benefit from a Security Document under the Agreed
Security Principles as soon as reasonably practicable and in any event within
15 Business Days following the date on which it is not prevented from doing so
under the terms of the USPP;


 

















 


 


(b)                                 enter into the Subordination Agreement as
soon as reasonably practicable and in any event within 45 days of the date of
this Agreement; and


 


(c)                                  execute and do all such assurances, acts and
things as the Intercreditor Agent and the Security Agent may reasonably require
to effect the above including perfecting or protecting the security intended to
be afforded by the Security Documents and shall deliver to the Intercreditor
Agent and the Security Agent at the same time such directors’ and shareholders’
resolutions, title documents and other documents and legal opinions as set out
in Part 2 of Schedule 2 (Conditions precedent) and otherwise as the
Intercreditor Agent and the Security Agent may reasonably require in relation
to the same.


 


9.28                        ERISA Reporting Requirements


 


The following shall be
provided to the Intercreditor Agent:


 


(a)                           (i)                  promptly
and in any event within 10 Business Days after any Obligor or any ERISA
Affiliate knows or has reason to know that any ERISA Event has occurred that is
reasonably expected to have a Material Adverse Effect, a statement of the Chief
Financial Officer of the Obligor describing such ERISA Event and the action, if
any, that such Obligor or such ERISA Affiliate has taken and proposes to take
with respect thereto; and


 


(ii)                                  on the date any records, documents or other
information must be furnished to the PBGC with respect to any Plan pursuant to
Section 4010 of ERISA, a copy of such records, documents and information;


 


(b)                                 promptly and in any event within five
Business Days after receipt thereof by any Obligor or any ERISA Affiliate,
copies of each notice from the PBGC stating its intention to terminate any Plan
or to have a trustee appointed to administer any Plan;


 


(c)                                  promptly upon request of the Intercreditor
Agent/a Finance Party, copies of each Schedule B (Actuarial Information) to the
most recent annual report (Form 5500 Series) with respect to each Plan; and


 


(d)                                 promptly and in any event within five
Business Days after receipt thereof by any Obligor or any ERISA Affiliate from
the sponsor of a Multiemployer Plan, copies of each notice concerning (i) the
imposition of Withdrawal Liability by any such Multiemployer Plan that is
reasonably expected to have a Material Adverse Effect, (ii) the reorganisation
or termination, within the meaning of Title IV of ERISA, of any such Multiemployer
Plan that is reasonably expected to have a Material Adverse Effect or (iii) the
amount of liability incurred, or that may be incurred, by such Obligor or any
ERISA Affiliate in connection with any event described in Clause (i) or (ii).


 


9.29                        United States laws


 


(a)                                  The Company will not, either by act or
omission, become, or permit any other Obligor, to become, subject to regulation
under PUHCA.


 


(b)                                 The Company will not, either by act or
omission, become, or permit any other Obligor, to become, subject to regulation
under the Federal Power Act.


 


(c)                                  The Company will not, either by act or
omission, become, or permit any other Obligor to become, an investment company
or a company controlled by an investment company.


 


9.30                        Cash pooling / Inter-Company
loan arrangements


 


(a)                                  The Company shall use its best efforts to
maintain its existing cash pooling arrangements as are currently in force at
the date of this Agreement where failure to so maintain has or would be
reasonably likely to have a Material Adverse Effect.


 


(b)                                 The Company will ensure that all Secured
Intra Group Loans and, subject to and in accordance with the Subordination
Agreement, long-term Inter-Company Debt between any member of the Group which
is a creditor of an Obligor is documented in the form of the agreed
Inter-Company Debt loan agreement.


 


(c)                                  The Company will ensure that all
Inter-Company Debts between any member of the Group which is a creditor of the
Company are subject to the Subordination Agreement on or before incurring any such
Inter-Company Debt.


 

















 


10.                               FINANCIAL COVENANTS


 


10.1                        Financial covenant
definitions


 


In this Clause 10:


 


Adjusted EBITDAR means, in respect of a particular period, the Company’s EBITDAR
adjusted to reflect the EBITDAR of each Relevant Entity (Relevant Entity EBITDAR), provided that the
amount of such adjustment shall be pro rata
to the Company’s participation in the capital of the Relevant Entity.


 


Consolidated Net Indebtedness means, without double counting, the
aggregate of (A) the Company’s long term debt (including participating loans),
bank overdrafts, current portion of long term debt, (B) guarantees given with
respect to Financial Indebtedness of third parties or joint ventures in which
the Company is involved or the Company’s unconsolidated subsidiaries or
otherwise (C) outstanding amounts with respect to any securitisation programme,
sale of receivables and any outstanding amount under a lease (being defined as
the aggregate of the net present value of (i) lease rentals and (ii) the
residual value or lease balance of such lease) and (D) short term borrowings minus the aggregate of cash, short term
deposits, marketable securities, each as calculated from the items so described
in the English language version of the consolidated accounts of the Company
most recently delivered by the Company to the Intercreditor Agent under Clause
9.2 (Financial information).


 


EBITDA
means, in respect of a particular period, (before restructuring costs and after
cash impact of provisions other than provisions for restructuring) and in
respect of the Company or a Relevant Entity, the aggregate of the Company’s or
the Relevant Entity’s (as the case may be) (as determined from the accounts of
the Relevant Entity most recently delivered by the Company to the Intercreditor
Agent under Clause 9.2(a)(v)) Operating Income, Depreciation and Amortisation
of Assets, where:


 


(a)                                  Operating Income means net sales minus operating expenses
(operating expenses being production costs and expenses, administrative and
selling expenses, research and development expenses, Depreciation and
Amortisation of Assets, additional goodwill amortisation (if any) and provision
for environmental costs);


 


(b)                                 Depreciation and
Amortisation of Assets
means:


 


(i)                                     amortisation of acquisition goodwill and equity
goodwill in net income of affiliated companies;


 


(ii)                                  amortisation of patents, licenses,
trade-marks and software;


 


(iii)                               amortisation of other intangible assets;


 


(iv)                              depreciation of land, buildings and other
tangible assets;


 


(v)                                 additional goodwill amortisation (if any);
and


 


(vi)                              investments allowance.


 


EBITDAR means in respect of a particular period, EBITDA for that period plus
the aggregate amount of any lease rental payments paid or payable in that
period to the extent such payments are taken into account as an operating
expense in the calculation of EBITDA.


 


Net Financial Expenses means, in respect of a particular period,
Interest Expenses minus Interest
Income, where:


 


(a)                                  Interest Expenses means the aggregate of the Company’s
interest on financial debts and financing operations (being interest on loans
payable and bank overdrafts, financial expenses related to securitisations, the
interest element of lease rental payments, discounts of notes receivable and
amortisation of redemption premium) after capitalisation of financial expenses
related to the financing of certain assets and incorporated in the purchase
cost of such assets, excluding
penalties or commissions for loan prepayment, losses on financial instruments
such as interest rate options and interest rate swaps, interest payable on non
financial debts (commercial or other), loans issuing costs whether or not
spread over the duration of the loan, net losses on disposals of marketable
securities, decreases in the probable stock exchange value of trading
securities, losses on repurchase of shares, debentures and other securities
issued by the Company or its Subsidiaries; and


 






















 




(b)                                 Interest income means the Company’s interest income on

financial assets (loans receivable, debit balance on bank current accounts,

etc.), excluding income from non

financial receivables, gains on financial instruments such as interest rate

swaps or interest rate options, gains on disposal of marketable securities,

increase in the probable stock exchange value of trading securities, income

from marketable securities, gains on repurchase of shares, debentures or other

securities issued by the Company or its Subsidiaries,




 




each as calculated from the

items so described in the English language version of the consolidated

financial statements of the Company most recently delivered by the Company to

the Intercreditor Agent under Clause 9.2 (Financial information).




 




Ratio Period means each twelve month period ending on the date to which each set of

financial statements delivered by the Company pursuant to Clause 9.2 (Financial

information) was prepared.




 




Testing Date means 31st March, 30th June, 30th September and 31st December of each

year.




 




10.2                        Ratio of Consolidated Net

Indebtedness to Adjusted EBITDAR




 




The Company shall procure

that the ratio of its Consolidated Net Indebtedness to its Adjusted EBITDAR is

not, on each Testing Date in relation to any Ratio Period ending on that

Testing Date, greater than:




 




(a)                                  9.0:1.0 in respect of the Ratio Period ending

on 31st December, 2003; and




 




(b)                                 9.5:1.0 in respect of the Ratio Period ending

on 31st March, 2004.




 




10.3                        Ratio of EBITDAR to Net

Financial Expenses




 




The Company shall procure

that the ratio of its EBITDAR to its Net Financial Expenses is not, at the end

of each Ratio Period, less than:




 




(a)                                  2.0 to 1.0 in respect of the Ratio Period

ending on 31st December, 2003; and




 




(b)                                 1.75 to 1.0 in respect of the Ratio Period

ending on 31st March, 2004.




 




10.4                        Net Debt




 




The Company shall procure

that the Consolidated Net Indebtedness is not on each Testing Date greater

than:




 




(a)                                  €3,850,000,000 on the Testing Date falling on

31st December, 2003; and




 




(b)                                 €4,050,000,000 on the Testing Date falling on

31st March, 2004.




 




10.5                        Calculation and

interpretation




 




(a)                                  All the terms used in Clause 10.1 (Financial

covenant definitions) are to be calculated in accordance with the accounting

principles and practices applied in connection with the Original Financial

Statements, consistently applied.




 




(b)                                 The Company shall promptly notify the

Intercreditor Agent of:




 




(i)                                     each change in the accounting principles and

practices in accordance with which the Company’s consolidated financial

statements are prepared; and




 




(ii)                                  each change in the end of the Company’s

financial year.




 




(c)                                  Following each change of the type referred to

in paragraph (b) above, the Company shall:




 




(i)                                     procure that its chief financial officer or

(if the Intercreditor Agent so requests) its statutory auditors deliver with

the audited financial statements of the Company next delivered under Clause 9.2

(Financial information) (the New Accounts)

a certificate containing a description of the change in the basis on which the

Company’s consolidated financial statements are prepared from that used in the

preparation of the consolidated financial statements of the Company delivered

immediately prior to the change (the Old

Accounts) and information:




 





























 




(A)                              sufficient, in the reasonable opinion of the

Majority Lenders, to allow the Finance Parties to make an accurate comparison

of the Company’s financial position as set out in the Old Accounts and that set

out in the New Accounts and any adjustments necessary to ensure that the New

Accounts reflect the format, and/or basis used in the preparation, of the Old

Accounts; and




 




(B)                                sufficient, in the reasonable opinion of the

Intercreditor Agent, to enable the Intercreditor Agent to ascertain the

compliance by the Company with the financial covenants contained in Clauses

10.2 (Ratio of Consolidated Net Indebtedness to Adjusted EBITDAR) and 10.3

(Ratio of EBITDAR to Net Financial Expenses); and




 




(ii)                                  at the request of the Intercreditor Agent

(acting on the instructions of the Majority Lenders), negotiate in good faith

with the Intercreditor Agent with a view to agreeing such amendments to this

Clause 10 as may be necessary to ensure that the Finance Parties’ interests

under this Agreement are not prejudiced by such change.




 




(d)                                 If:




 




(i)                                     the Intercreditor Agent, acting reasonably,

disputes (1) the Company’s statutory auditors’ interpretation of any term in

Clause 10.1 (Financial covenant definitions) or any computation under this

Clause 10, in each case, contained in a certificate delivered by the Company

under Clause 9.2 (Financial information) or (2) any certificate or the contents

thereof delivered by the Company’s statutory auditors; or




 




(ii)                                  if no agreement is reached within 30 days of

a request by the Intercreditor Agent under paragraph (c)(ii) above),




 




the Intercreditor Agent may,

at the expense of the Company, instruct an independent expert (which shall be

an internationally recognised independent qualified firm of auditors) to act as

an expert and not as an arbitrator, and the determination of such expert shall

be final and binding on the Parties and, in the case of an instruction made

pursuant to paragraph (d)(ii) above, this Agreement will be amended to the

extent such expert advises to be necessary to ensure that the Finance Parties’

interests under this Agreement are not prejudiced by the change of the type

referred to in paragraph (b) above.




 




11.                               DEFAULT




 




11.1                           On and from the Commencement Date and (i)

until the Term Date; or (ii) if a Default is outstanding on the Term Date,

until no Default is outstanding, the expression Event of Default as defined in this Agreement shall supplement

all events of default or termination events (howsoever defined or described)

contained in the documentation relating to each Affected Facility as if such

Events of Default were set out therein mutatis

mutandis.




 




11.2                           Each of the events or circumstances set out

in this Clause 11 is an Event of Default (whether or not caused by any reason

whatsoever outside the control of any Obligor or any other person).




 




11.3                        Non-payment




 




An Obligor does not pay on

the due date any amount payable by it under any Finance Document or Facility

Agreement in the manner required under the Finance Documents or Facility

Agreements, unless the non-payment:




 




(a)                                  is caused by technical or administrative

error; and




 




(b)                                 is remedied within three Business Days of the

due date.




 




11.4                        Breach of other obligations




 




(a)       (i)                The

Company does not comply with any term of Clause 10 (Financial covenants) or

Clause 9.21 (Rights Issue and Other Matters); or




 




(ii)                                  at any time the projections set out in the

most recent Business Plan show that the Company will not be in compliance with

any term of Clause 10 (Financial covenants) on the then next Testing Date.




 




(b)                                 An Obligor does not comply with any of its

obligations (other than as referred to in paragraph (a) above) under any

Finance Document or any Facility Agreement not already referred to in paragraph

(a) above unless the non-compliance is capable of remedy and is remedied

within:




 





























 




(i)                                     fifteen calendar days of the earlier of the

Intercreditor Agent giving notice and the Obligor becoming aware of the

non-compliance; or




 




(ii)                                  where the non-compliance is in respect of an

Obligor’s obligations under a Facility Agreement, within the applicable grace

period provided in that Facility Agreement.




 




11.5                        Misrepresentation




 




(a)                                  A representation, warranty or statement made

or repeated in or in connection with any Finance Document or Facility

Agreements or in any document delivered by or on behalf of any Obligor under or

in connection with any Finance Document or Facility Agreement is incorrect in

any material respect when made or deemed to be made or repeated.




 




(b)                                 The Majority Lenders determine that a

representation, warranty or statement made or repeated in or in connection with

the Rights Issue or in any document delivered by or on behalf of any Obligor

under or in connection with the Rights Issue is incorrect in any material

respect when made or deemed to be made or repeated.




 




11.6                        Cross-default




 




(a)                                  Any of the following occurs in respect of any

Obligor or a Material Subsidiary:




 




(i)                                     any of its Financial Indebtedness is not paid

when due after the expiry of any applicable grace periods; or




 




(ii)                                  any event of default, termination event,

early repayment event or prepayment event or circumstance howsoever described

occurs under any document relating to its Financial Indebtedness (other than

this Agreement) including, without limitation, under the High Yield Bonds; or




 




(iii)                               any of its Financial Indebtedness is (or

becomes capable of being) declared prematurely due and payable or placed on

demand as a result of an event of default, termination event, early repayment

event or prepayment event (howsoever described) under the document relating to

that Financial Indebtedness including, without limitation, under the High Yield

Bonds; or




 




(iv)                              any commitment for, or underwriting of, any

Financial Indebtedness is cancelled or suspended as a result of an event of

default, termination event, early repayment event or prepayment event

(howsoever described) under the document relating to that Financial

Indebtedness; or




 




(v)                                 any Security Interest securing Financial

Indebtedness over any of its asset(s) becomes enforceable,




 




(b)                                 Provided that there shall only be an Event of

Default under this Clause 11.6, (i) if the aggregate amount of Financial

Indebtedness which is not paid when due or after the expiry of any applicable

grace period and/or to which that event of default, termination event, early

repayment event or prepayment event relates and/or which is (or becomes capable

of being) declared prematurely due and payable or placed on demand in each case

under paragraph (a) above exceeds €15,000,000 (or the equivalent in other

currencies) and (ii) in the case of a prepayment event in respect of Financial

Indebtedness under the High Yield Bonds, where (A) such Financial Indebtedness

has become due and payable or placed on demand; and (B) such prepayment event

does not relate to Excess Proceeds as defined in and paid in accordance with

clause 4.10 of the High Yield Bonds and this Agreement.




 




11.7                        Insolvency




 




Any of the following occurs

in respect of an Obligor or a Material Subsidiary:




 




(a)                                  it is, or is deemed for the purposes of any

law to be, unable to pay its debts as they fall due or insolvent (including

without limitation “en état de cessation des

paiements”);




 




(b)                                 it admits inability to pay its debts as they

fall due;




 




(c)                                  it suspends making payments on all or of its

or any class of its debts or announces an intention to do so;




 




(d)                                 a moratorium is declared in respect of any of

its indebtedness;




 




(e)                                  by reason of financial difficulties, applies

for, or is subject to, an amicable settlement or a “réglement amiable” pursuant to Article L-611-3 of the Code de Commerce of France, or begins

negotiations with one or more of its creditors with a view to the readjustment

or rescheduling of any of its indebtedness; or




 





























 




(f)                                    its situation becomes irremediably

compromised or it acts otherwise within the meaning of L-313-12 of the Code Monétaire et Financier.




 




11.8                        Insolvency proceedings




 




Any of the following occurs

in respect of an Obligor or a Material Subsidiary:




 




(a)                                  any step (including petition, proposal or

convening a meeting) is taken with a view to a composition, assignment or

arrangement with any of its creditors;




 




(b)                                 a meeting is convened for the purpose of

considering any resolution for (or to petition for) its winding-up,

administration or dissolution (including without limitation “dissolution, liquidation or redressement judiciaire”)

or any such resolution is passed;




 




(c)                                  any person presents a petition for its

winding-up or administration;




 




(d)                                 an order for its winding-up, administration,

dissolution or bankruptcy is made; or




 




(e)                                  a judgement is issued for the judicial

liquidation (“liquidation judiciaire”)

or the transfer of the whole of its business (“cession

de l’entreprise”); or




 




(f)                                    any other step (including petition, proposal

or convening a meeting) is taken with a view to its rehabilitation,

administration, custodianship, liquidation, winding-up or dissolution or any

other insolvency proceedings involving it.




 




11.9                        Appointment of receivers and

managers




 




Any of the following occurs

in respect of an Obligor or a Material Subsidiary:




 




(a)                                  any liquidator, trustee in bankruptcy,

judicial custodian, compulsory manager, receiver, administrative receiver,

administrator, administrateur judiciaire,

provisoire mandataire ad hoc, conciliateur or mandataire liquidateur or similar officer

is appointed in respect of it or any of its assets;




 




(b)                                 its directors or other officers request the

appointment of a liquidator, trustee in bankruptcy, judicial custodian,

compulsory manager, receiver, administrative receiver, administrator, administrateur judiciaire, provisoire mandataire ad

hoc, conciliateur or mandataire

liquidateur or similar officer; or




 




(c)                                  any other steps are taken to enforce any

Security Interest over any part of its assets.




 




11.10                 United States Bankruptcy

Laws




 




(a)                                  In this Subclause:




 




U.S. Bankruptcy Law means the United States Bankruptcy Code 1978 or any other United

States Federal or State bankruptcy, insolvency or similar law.




 




U.S. Obligor means an Obligor incorporated or organised under the laws of the

United States of America or any state of the United States of America

(including the District of Columbia).




 




Terms used in this Subclause

have the meanings given to them in the United States Bankruptcy Code 1978, as

amended, and applicable fraudulent conveyance laws in the United States of

America.




 




(b)                                 Any of the following occurs in respect of a

U.S. Obligor (other than Primester in the case of paragraphs (iv) or (v) below)

(on a consolidated basis):




 




(i)                                     it makes a general assignment for the benefit

of creditors;




 




(ii)                                  it commences a voluntary case or proceeding

under any U.S. Bankruptcy Law; or




 





























 




(iii)                               an involuntary case under any U.S. Bankruptcy

Law is commenced against it and is not controverted within 21 days or is not

dismissed or stayed within 45 days after commencement of the case; or




 




(iv)                              the aggregate amount of its debts (including

its obligations (if any) under the Finance Documents and the Facility

Agreements) is greater than the aggregate value (being the lesser of fair present

valuation and present fair saleable value) of its assets (which for, avoidance

of doubt, include, without limitation, all rights of indemnification,

contribution and subrogation); or




 




(v)                                 its capital is unreasonably small to carry on

its business as it is being conducted; or




 




(vi)                              it incurs debts beyond its ability to pay as

they mature on the date on which the debts were incurred; or




 




(vii)                           it has made a transfer or incurred an

obligation under a Finance Document or a Facility Agreement with the intent to

hinder, delay or defraud any of its present or future creditors.




 




11.11                 Creditors’ process




 




Any attachment,

sequestration, distress execution or analogous event or circumstance affects

any material asset(s) of an Obligor or a Material Subsidiary and which in the

reasonable opinion of the Majority Lenders has or could be expected to have a

Material Adverse Effect.




 




11.12                 Analogous proceedings




 




There occurs, in relation to

an Obligor or a Material Subsidiary, any event or circumstance anywhere which,

in the opinion of the relevant Lender or the Majority Lenders (acting in good

faith), appears to correspond with any of those mentioned in Clauses 11.7

(Insolvency) to 11.11 (Creditors’ process) (inclusive).




 




11.13                 Cessation of business




 




Any Obligor or a Material

Subsidiary ceases, or threatens to cease, to carry on all or a substantial part

of its business except in respect of the Asset Disposal Programme.




 




11.14                 Effectiveness of Finance

Documents and Facility Agreements




 




(a)                                  It is or becomes unlawful for an Obligor or

any other person (other than a Finance Party) to perform any of its obligations

under the Finance Documents or the Facility Agreements.




 




(b)                                 Any Finance Document or Facility Agreement is

not effective or is alleged by an Obligor to be ineffective for any reason.




 




(c)                                  An Obligor repudiates a Finance Document or

Facility Agreement or evidences an intention to repudiate a Transaction

Document.




 




(d)                                 A Security Document does not create the

security it purports to create in any respect considered by the Majority

Lenders to be materially adverse to the interests of the Finance Parties under

the Finance Documents or the Facility Agreements.




 




(e)                                  A guarantee of any Obligor is invalid or

unenforceable in any respect considered by the Majority Lenders to be

materially adverse to the interests of the Finance Parties under the Finance

Documents or the Facility Agreements.




 




(f)                                    The subordination provisions under the

Subordination Agreement or the ranking of security under the Security Documents

is not effective.




 




(g)                                 The Rights Issue is not completed by the Term

Date or the Company repudiates, declares or states in writing that it cannot or

does not intend to, or it becomes unlawful for the Company to, complete the

Rights Issue by the Term Date.




 




(h)                                 The Asset Disposal Programme is not initiated

or implemented in accordance with the terms of the definition thereof or the

Company repudiates, declares or states in writing that it cannot or does not

intend to, or it becomes unlawful for the Company to, initiate or implement the

Asset Disposal Programme in accordance with the terms of the definition

thereof.




 





























 




11.15                 Audit qualification




 




An Obligor’s auditors

qualify their report on any audited consolidated accounts of the relevant

Obligor in any manner whatsoever (except where such qualification is of a minor

technical or non-material nature) and (except in the case of the Company) where

that qualification is material in the context of the Group (taken as a whole).




 




11.16                 Shares and Dividends




 




A meeting of shareholders of

the Company is convened at which a resolution is passed to pay any dividend, or

other distribution (in cash or in kind) in respect of its share capital or any

management fees or charges in favour of its shareholders or its shareholders’

Affiliates.




 




11.17                 ERISA




 




(a)                                  Any Plan fails to satisfy the minimum funding

standards of ERISA or the Code for any plan year or part thereof or a waiver of

such standards or extension of any amortisation period is sought or granted

under section 412 of the Code; or




 




(b)                                 a notice of intent to terminate any Plan is,

or is reasonably expected to be, filed with the PBGC or the PBGC institutes

proceedings under ERISA section 4042 to terminate or appoint a trustee to

administer any Plan or the PBGC notifies the Company or any ERISA Affiliate

that a Plan may become a subject of any such proceedings; or




 




(c)                                  the aggregate accumulated benefit obligations

(as defined in Statement of Financial Accounting Standards 87) under all Plans

exceeds the fair market value of all assets of such Plans allocable to such

benefits by more than US$50,000,000, all determined as of the date of the most

recent financial statements for such Plans; or




 




(d)                                 the Company or any ERISA Affiliate incurs or

is reasonably expected to incur any liability pursuant to Title I or IV of

ERISA or the penalty or excise tax provisions of the Code relating to employee

benefit plans; or




 




(e)                                  the Company or any ERISA Affiliate withdraws

from any Multiemployer Plan; or




 




(f)                                    any member of the Group establishes or amends

any employee welfare benefit plan that provides post-employment welfare

benefits in a manner that would increase the liability of any member of the

Group thereunder,




 




and such events (whether

individually or taken together) could reasonably be expected to have a Material

Adverse Effect.




 




11.18                 Litigation




 




Any litigation, arbitration

or administrative proceeding or claim is threatened, pending, commenced or

ongoing against any Obligor, any Material Subsidiary or any of the assets of

the Group which in the opinion of the Majority Lenders has or could reasonably

be expected to have by itself or together with any other such proceedings or

claims to have a Material Adverse Effect.




 




11.19                 Material adverse change




 




Any event or circumstance

occurs after the date of this Agreement, which, in the opinion of the Majority

Lenders (acting in good faith) has, or could reasonably be expected to have, a

Material Adverse Effect.




 




11.20                 Enforcement Action




 




(a)                                  On and at any time after the occurrence of an

Event of Default and whilst the same is outstanding:




 




(i)                                     a Lender may, upon the occurrence of an Event

of Default under Clause 11.3 (Non-payment) or under Clauses 11.7 (Insolvency)

through to 11.12 (Analogous proceedings) (inclusive) or under Clause 11.14

(Effectiveness of Finance Documents);




 




(ii)                                  a Lender to Rhodia Inc. may upon the

occurrence of an Event of Default occurring under Clause 11.6 (Cross-default)

with respect to the USPP and any enforcement action having been taken with

respect to the guarantee of the USPP by Rhodia Inc.;




 




(iii)                               a Lender to Rhodia Inc. may upon the

occurrence of an Event of Default occurring under Clause 11.6 (Cross-default)

as a result of any Financial Indebtedness of the Company and/or Rhodia Holdings

Inc. and/or Rhodia Inc. exceeding €30,000,000 (or its equivalent in other

currencies) becoming due and payable before its stated maturity by way of a

declared default under the document relating to that Financial Indebtedness

after expiry of any applicable grace period;




 





























 




and




 




(iv)                              a Lender to Rhodia Inc. may if Rhodia Inc.

makes a payment or distribution on or after the date of this Agreement to the

Company with sale proceeds from disposals of its assets in an aggregate amount

exceeding €150,000,000 (or its equivalent in other currencies),




 




exercise any and all rights

and remedies (including without limitation subject to the Security Sharing

Agreement, taking any Enforcement Action) as it has under or in connection with

any Affected Facility subject to and in accordance with its terms.




 




(b)                                 On and at any time after notification by the

Intercreditor Agent of a Declared Default (which Intercreditor Agent shall

notify to all Parties if so instructed by the Majority Lenders) and whilst the

same is outstanding a Lender may:




 




(i)                                     exercise any and all rights and remedies

(including without limitation, subject to the Security Sharing Agreement, take

any Enforcement Action) as it has under or in connection with any Affected

Facility or otherwise; and/or




 




(ii)                                  take or instruct the Security Agent or

Intercreditor Agent to take such Enforcement Action as is permitted by and in

accordance with the Security Sharing Agreement and the other Finance Documents.




 




(c)                                  A Lender shall notify the Intercreditor Agent

before exercising the rights referred to in paragraphs (a) and (b) above.




 




(d)                                 The provisions of this Clause 11.20

(Enforcement Action) shall continue in full force and effect and shall survive

the termination of this Agreement with respect to any outstanding Default or

Declared Default notwithstanding the expiry of the Secured Intercreditor

Period.




 




12.                               THE ADMINISTRATIVE PARTIES




 




12.1                        Appointment and duties of

the Intercreditor Agent




 




(a)                                  Each Finance Party (other than the

Intercreditor Agent) irrevocably appoints the Intercreditor Agent to act as its

agent under the Finance Documents.




 




(b)                                 Each Finance Party (other than the

Intercreditor Agent) irrevocably authorises the Intercreditor Agent to:




 




(i)                                     perform the duties and to exercise the

rights, powers and discretions that are specifically given to it under the

Finance Documents, together with any other incidental rights, powers and

discretions; and




 




(ii)                                  execute each Finance Document in an agreed

form expressed to be executed by the Intercreditor Agent.




 




(c)                                  The Intercreditor Agent has only those duties

which are expressly specified in this Agreement. Those duties are solely of a

mechanical and administrative nature.




 




12.2                        The Members




 




Except as specifically

provided in the Finance Documents, no Member has any obligations of any kind to

any other Party in connection with any Finance Document.




 




12.3                        No fiduciary duties




 




Nothing in the Finance

Documents makes the Intercreditor Agent a trustee or fiduciary for any other

Party or any other person. The Intercreditor Agent need not hold in trust any

moneys paid to it for a Party or be liable to account for interest on those

moneys.




 




12.4                        Individual position of the

Intercreditor Agent




 




(a)                                  If it is also a Lender, the Intercreditor

Agent has the same rights and powers under the Finance Documents as any other

Lender and may exercise those rights and powers as though it were not an agent.




 




(b)                                 The Intercreditor Agent may:




 




(i)                                     carry on any business with any Obligor or its

related entities (including acting as an agent or a trustee for any other

financing); and




 




(ii)                                  retain any profits or remuneration it

receives under the Finance Documents or in relation to any other business it

carries on with any Obligor or its related entities.




 





























 




12.5                        Reliance




 




The Intercreditor Agent may:




 




(a)                                  rely on any notice or document believed by it

to be genuine and correct and to have been signed by, or with the authority of,

the proper person;




 




(b)                                 rely on any statement made by any person

regarding any matters which may reasonably be assumed to be within his

knowledge or within his power to verify;




 




(c)                                  engage, pay for and rely on professional

advisers selected by it (including those representing a Party other than the

Intercreditor Agent); and




 




(d)                                 act under the Finance Documents through its

personnel and agents.




 




12.6                        Majority Lenders’

instructions




 




(a)                                  The Intercreditor Agent is fully protected if

it acts on the instructions of the Majority Lenders or where expressly required

by the terms of the Finance Documents, the Lenders in the exercise of any

right, power or discretion or any matter not expressly provided for in the

Finance Documents. Any such instructions given by the Majority Lenders or the

Lenders as the case may be will be binding on all the Lenders. In the absence

of instructions, the Intercreditor Agent may act as it considers to be in the

best interests of all the Lenders.




 




(b)                                 The Intercreditor Agent is not authorised to

act on behalf of a Lender (without first obtaining that Lender’s consent) in

any legal or arbitration proceedings in connection with any Finance Document.




 




(c)                                  The Intercreditor Agent may require the

receipt of security satisfactory to it, whether by way of payment in advance or

otherwise, against any liability or loss which it may incur in complying with

the instructions of the Majority Lenders.




 




12.7                        Responsibility




 




(a)                                  The Intercreditor Agent is not responsible to

any other Finance Party for the adequacy, accuracy or completeness of:




 




(i)                                     any Finance Document or any other document;

or




 




(ii)                                  any statement or information (whether written

or oral) made in or supplied in connection with any Finance Document.




 




(b)                                 Without affecting the responsibility of any

Obligor for information supplied by it or on its behalf in connection with any

Finance Document, each Lender confirms that it:




 




(i)                                     has made, and will continue to make, its own

independent appraisal of all risks arising under or in connection with the

Finance Documents (including the financial condition and affairs of each

Obligor and its related entities and the nature and extent of any recourse

against any Party or its assets); and




 




(ii)                                  has not relied exclusively on any information

provided to it by the Intercreditor Agent in connection with any Finance

Document.




 




12.8                        Exclusion of liability




 




(a)                                  The Intercreditor Agent is not liable to any

other Finance Party for any action taken or not taken by it in connection with

any Finance Document, unless directly caused by its negligence or wilful

misconduct.




 




(b)                                 No Party may take any proceedings against any

officer, employee or agent of the Intercreditor Agent in respect of any claim

it might have against the Intercreditor Agent or in respect of any act or

omission of any kind by that officer, employee or agent in connection with any

Finance Document. Any officer, employee or agent of the Intercreditor Agent may

rely on this Subclause.




 





























 




12.9                        Default




 




(a)                                  The Intercreditor Agent is not obliged to

monitor or enquire whether a Default has occurred. The Intercreditor Agent is

not deemed to have knowledge of the occurrence of a Default.




 




(b)                                 If the Intercreditor Agent:




 




(i)                                     receives notice from a Party referring to

this Agreement, describing a Default and stating that the event is a Default;

or




 




(ii)                                  is aware of the non-payment of any principal

or interest or any fee payable to a Lender under this Agreement,




 




it must promptly notify the

Lenders.




 




12.10                 Information




 




(a)                                  The Intercreditor Agent must promptly forward

to the person concerned the original or a copy of any document which is

delivered to the Intercreditor Agent by a Party for that person.




 




(b)                                 Except where a Finance Document specifically

provides otherwise, the Intercreditor Agent is not obliged to review or check

the adequacy, accuracy or completeness of any document it forwards to another

Party.




 




(c)                                  Except as provided above, the Intercreditor

Agent has no duty:




 




(i)                                     either initially or on a continuing basis to

provide any Lender with any credit or other information concerning the risks

arising under or in connection with the Finance Documents (including any

information relating to the financial condition or affairs of any Obligor or

its related entities or the nature or extent of recourse against any Party or

its assets) whether coming into its possession before, on or after the date of

this Agreement; or




 




(ii)                                  unless specifically requested to do so by a

Lender in accordance with a Finance Document, to request any certificate or

other document from any Obligor.




 




(d)                                 In acting as the Intercreditor Agent, its

agency division is treated as a separate entity from its other divisions and

departments. Any information acquired by it which, in its opinion, is acquired

by it otherwise than in its capacity as the Intercreditor Agent may be treated

as confidential by the Intercreditor Agent and will not be treated as

information possessed by the Intercreditor Agent in its capacity as such.




 




(e)                                  Each Obligor irrevocably authorises the

Intercreditor Agent to disclose to the other Finance Parties any information

which, in its opinion (acting reasonably), is received by it in its capacity as

the Intercreditor Agent.




 




12.11                 Indemnities




 




(a)                                  Without limiting the liability of any Obligor

under the Finance Documents, each Lender must indemnify the Intercreditor Agent

for that share of any loss or liability incurred by it in acting as the

Intercreditor Agent, except to the extent that the loss or liability is caused

by its gross negligence or wilful misconduct. A Lender’s share of any loss or

liability is the proportion which the Exposure of the Lender bears to the

aggregate of the Exposures of all the Lenders.




 




(b)                                 The Intercreditor Agent may deduct from any

amount received by it for a Lender any amount due to the Intercreditor Agent

from that Lender under a Finance Document but unpaid.




 




12.12                 Compliance




 




The Intercreditor Agent may

refrain from doing anything (including the disclosure of any information) which

might, in its opinion, constitute a breach of any law or regulation or be otherwise

actionable at the suit of any person, and may do anything which, in its

opinion, is necessary or desirable to comply with any law or regulation.




 




12.13                 Resignation of the

Intercreditor Agent




 




(a)                                  The Intercreditor Agent may resign and

appoint any of its Affiliates as successor Intercreditor Agent by giving notice

to the Lenders and the Company.




 





























 




(b)                                 Alternatively, the Intercreditor Agent may

resign by giving notice to the Lenders and the Company, in which case the

Majority Lenders (after prior consultation with the Company) may appoint a

successor Intercreditor Agent.




 




(c)                                  If no successor Intercreditor Agent has been

appointed under paragraph (b) above within 30 days after notice of resignation

was given, the Intercreditor Agent (after prior consultation with the Company)

may appoint a successor Intercreditor Agent.




 




(d)                                 The person(s) appointing a successor

Intercreditor Agent must, if practicable, consult with the Company prior to the

appointment.




 




(e)                                  The resignation of the Intercreditor Agent

and the appointment of any successor Intercreditor Agent will both become

effective only when the successor Intercreditor Agent notifies all the Parties

that it accepts its appointment. On giving the notification, the successor

Intercreditor Agent will succeed to the position of the retiring Intercreditor

Agent and Intercreditor Agent will

mean the successor Intercreditor Agent.




 




(f)                                    The retiring Intercreditor Agent must, at its

own cost, make available to the successor Intercreditor Agent such documents and

records and provide such assistance as the successor Intercreditor Agent may

reasonably request for the purposes of performing its functions as the

Intercreditor Agent under the Finance Documents.




 




(g)                                 Upon its resignation becoming effective, this

Clause will continue to benefit a retiring Intercreditor Agent in respect of

any action taken or not taken by it in connection with the Finance Documents

while it was the Intercreditor Agent, and, subject to paragraph (f) above, it

will have no further obligations under any Finance Document.




 




(h)                                 The Majority Lenders may, by notice to the

Intercreditor Agent, require it to resign under paragraph (b) above.




 




12.14                 Relationship with Lenders




 




(a)                                  The Intercreditor Agent may treat each Lender

as a Lender, entitled to payments under this Agreement and as acting through

its Facility Office(s) until it has received not less than five Business Days’

prior notice from that Lender to the contrary.




 




(b)                                 The Intercreditor Agent may at any time, and

must if requested to do so by the Majority Lenders, convene a meeting of the

Lenders.




 




12.15                 Intercreditor Agent’s

management time




 




If the Intercreditor Agent

requires, any amount payable to the Intercreditor Agent by any Party under any

indemnity or in respect of any costs or expenses incurred by the Intercreditor

Agent under the Finance Documents after the date of this Agreement may include

the cost of using its management time or other resources and will be calculated

on the basis of such reasonable daily or hourly rates as the Intercreditor

Agent may notify to the relevant Party. This is in addition to any amount in

respect of fees or expenses paid or payable to the Intercreditor Agent under

any other term of the Finance Documents.




 




13.                               EXPENSES




 




13.1                        Initial and special costs




 




The Company shall forthwith

on demand pay the amount of all costs and expenses (including legal fees)

properly incurred by any Lender and the Intercreditor Agent in connection with:




 




(a)                                  the negotiation, preparation, printing and

execution of:




 




(i)                                     this Agreement and any other documents

referred to in this Agreement; and




 




(ii)                                  any other Finance Document (other than an

Accession Agreement) executed after the date of this Agreement; and




 




(b)                                 any amendment, waiver, consent or suspension

of rights (or any proposal for any of the foregoing) requested by or on behalf

of an Obligor and relating to a Finance Document or a document referred to in

any Finance Document.




 




13.2                        Enforcement costs




 




The Company shall forthwith

on demand pay to each Finance Party the amount of all costs and expenses

(including legal fees) incurred in connection with the enforcement of, or the

preservation of any rights under, any Finance Document.




 





























 




14.                               CHANGES TO THE PARTIES




 




14.1                        Transfer by Obligors




 




No Obligor may assign,

transfer or novate or dispose of any of, or any interest in, any of its rights

and/or obligations under the Finance Documents.




 




14.2                        Accession by Additional

Obligors




 




(a)                                  The Company must ensure that each Borrowing

Group Member (other than an Original Obligor) which is a party to an Affected

Facility becomes an Additional Obligor in the manner required by this Clause

14.2 as soon as reasonably practicable and in any event not later than 31st

January, 2004.




 




(b)                                 The relevant Borrowing Group Member will

become an Additional Obligor and be bound by all the obligations under the

Finance Documents as if it had been originally party to those documents as an

Obligor when the Intercreditor Agent notifies the other Finance Parties and the

Company that it has received all of the documents and evidence listed in Part 3

of Schedule 2 (Additional Obligor conditions precedent documents) in form and

substance satisfactory to it. The Intercreditor Agent must give this

notification as soon as reasonably practicable.




 




(c)                                  Delivery of an Accession Agreement, executed

by the relevant Borrowing Group Member and the Company, to the Facility Agent

constitutes confirmation by that Subsidiary and the Company that the

representations set out in Clause 8 which are to be repeated and under Clauses

8.19, 8.20 and 8.23 as if repeated are then correct.




 




(d)                                 Paragraph (a) does not apply to Primester for

as long as it has no loan outstanding under the Primester Facility.




 




14.3                        Transfers by Lenders




 




(a)                                  No Lender may assign, transfer or novate any

of its rights and/or obligations under any of the Finance Documents unless and

until the assignee or transferee has delivered a duly executed Accession

Agreement to the Intercreditor Agent.




 




(b)                                 Notwithstanding paragraph (a) above, no

Lender which is or is to become a party to the Refinancing Facilities Agreement

may assign, transfer or novate any of its rights and/or obligations under any

of the Finance Documents (except to an Affiliate which has delivered an

Accession Agreement pursuant to paragraph (a)) unless and until the Refinancing

Facilities Agreement has been executed by all parties thereto.




 




14.4                        Accession by Lenders




 




(a)                                  During the Secured Intercreditor Period, upon

the delivery to the Intercreditor Agent of a duly executed Accession Agreement

the bank or financial institution which is party to that Accession Agreement

will become a party to:




 




(i)                                     this Agreement; and, to the extent entered

into at that time,




 




(ii)                                  the Security Sharing Agreement;




 




(iii)                               the Subordination Agreement; and




 




(together the Agreements) as a Lender; or




 




(b)                                 Any person becoming a party to the Agreements

under paragraph (a) shall be entitled to the benefit of all the provisions and

bound by all of the obligations in the Agreements with effect from the date of

accession as if it had been an original party to those Agreements.




 




14.5                        Register




 




The Intercreditor Agent

shall keep a register of all the Parties and shall supply any other Party (at

that Party’s expense) with a copy of the register on request.




 





























 




15.                               AMENDMENTS AND WAIVERS




 




15.1                        Procedure




 




(a)                                  Except as provided in this Clause, any term

of a Finance Document may be amended or waived with the agreement of the

Company, the Intercreditor Agent and the Majority Lenders. The Intercreditor

Agent may effect, on behalf of any Finance Party, an amendment or waiver

permitted under this Clause.




 




(b)                                 The Intercreditor Agent shall promptly notify

the other Parties of any amendment or waiver effected under paragraph (a), and

any such amendment or waiver shall be binding on all the Parties.




 




15.2                        Exceptions




 




(a)                                  An amendment or waiver not agreed by a

Finance Party which:




 




(i)                                     relates to the definition of Insolvency Event, Majority Lenders, Finance Documents, Transaction Documents, Exposure, Enforcement Action

or Term Date (other than as

expressly provided in the definition thereof) in Clause 1.1 (Definitions);




 




(ii)                                  an extension of the date of payment of any

amount to a Lender payable under the Finance Documents;




 




(iii)                               relates to a reduction in the amount of any

payment of fees or other amount payable to a Lender under the Finance Documents

or Facility Agreement to which that Party is a party;




 




(iv)                              relates to Clause 3 (Secured Intercreditor

Period), Clause 4.1 (Affected Facilities), Clause 7 (Mandatory prepayment and

cancellation), Clause 11.3 (Non-payment), Clause 11.7 (Insolvency) through to

11.12 (Analogous proceedings) (inclusive), Clause 11.14 (Effectiveness of

Finance Documents) or Clause 11.20(a) (Enforcement Action);




 




(v)                                 relates to Clause 14.1 (Transfer by Obligors)

and Clause 14.3 (Transfers by Lenders);




 




(vi)                              relates to Clause 4.11 (Amendments to

Affected Facilities);




 




(vii)                           relates to a guarantee under this Agreement

or a Security Document in favour of that Finance Party or any of the Agreed

Security Principles;




 




(viii)                        relates to this Clause 15 (Amendments and

waivers); or




 




(ix)                                relates to a term or satisfaction of a

condition of a Finance Document which expressly requires the consent or

determination of that Party,




 




is not binding on that

Party.




 




(b)                                 An amendment or waiver which affects the

rights and/or obligations of the Intercreditor Agent, or the rights of the

Co-ordinating Committee in respect of Clauses 12.2 (The Members) and 19

(Co-ordinating Committee) may not be effected without respectively the prior

written consent of the Intercreditor Agent or the Co-ordinating Committee as

applicable.




 




15.3                        Waivers and remedies

cumulative




 




The rights of each Finance

Party under this Agreement:




 




(a)                                  may be exercised as often as necessary;




 




(b)                                 are cumulative and not exclusive of its

rights under the general law; and




 




(c)                                  may be waived only in writing and

specifically.




 




Delay in exercising or

non-exercise of any such right is not a waiver of that right.




 





























 




16.                               CONFIDENTIALITY




 




(a)                                  Each Finance Party must keep confidential the

terms of the Finance Documents and any information supplied to it by or on

behalf of any Obligor in connection with the Finance Documents. However, a

Finance Party is entitled to disclose information:




 




(i)                                     which is publicly available, other than as a

result of a breach by that Finance Party of this Clause;




 




(ii)                                  in connection with any legal, regulatory or

arbitration proceedings;




 




(iii)                               if required to do so under any law or

regulation;




 




(iv)                              to a government, banking, taxation or other

regulatory authority;




 




(v)                                 to its officers, directors, employees and

professional advisers;




 




(vi)                              to the extent allowed under paragraph (b)

below; or




 




(vii)                           with the agreement of the relevant Obligor.




 




The provisions of this

paragraph supersede and override any other confidentiality agreement or

undertaking signed between any Finance Party and any member of the Group in

respect of any information supplied pursuant to the Finance Documents except

information expressly provided to the Finance Parties prior to the date of this

Agreement subject to that other confidentiality agreement or undertaking.




 




(b)                                 A Finance Party may disclose to an Affiliate

or any person with whom it may enter, or has entered into, any kind of

transfer, participation or other agreement in relation to this Agreement (a participant):




 




(i)                                     a copy of this Agreement and any other

Finance Document to which it is a party; and




 




(ii)                                  any information which that Finance Party has

acquired under or in connection with any Finance Document.




 




However, before a

participant may receive any confidential information, it must agree with the

relevant Finance Party to keep that information confidential on the terms of

paragraph (a) above.




 




17.                               STAMP

DUTIES




 




The Company shall pay, and

forthwith on demand indemnify each Finance Party against any liability it

incurs in respect of, any stamp, registration and similar tax which is or

becomes payable in connection with the entry into, performance or enforcement

of any Finance Document.




 




18.                               INDEMNITIES




 




18.1                        Currency indemnity




 




(a)                                  Each Obligor must, as an independent

obligation, indemnify each Finance Party against any loss or liability

(including any exchange costs and taxes) which that Finance Party incurs as a

consequence of:




 




(i)                                     that Finance Party receiving an amount in

respect of an Obligor’s liability under the Finance Documents; or




 




(ii)                                  that liability being converted into a claim,

proof, judgement or order,




 




in a currency other than the

currency in which the amount is expressed to be payable under the relevant

Finance Document.




 




(b)                                 Unless otherwise required by law, each

Obligor waives any right it may have in any jurisdiction to pay any amount

under the Finance Documents in a currency other than that in which it is

expressed to be payable.




 




18.2                        Other indemnities




 




(a)                                  The Company must indemnify each Finance Party

against any loss or liability which that Finance Party incurs as a consequence

of:




 




(i)                                     the occurrence of any Default;




 





























 




(ii)                                  any failure by an Obligor to pay any amount

due under a Finance Document on its due date, including any resulting from any

distribution or redistribution of any amount among the Lenders under this

Agreement or under the Subordination Agreement.




 




(b)                                 The Company must indemnify the Intercreditor

Agent against any loss or liability incurred by the Intercreditor Agent as a

result of:




 




(i)                                     investigating any event which the

Intercreditor Agent reasonably believes to be a Default; or




 




(ii)                                  acting or relying on any notice which the

Intercreditor Agent reasonably believes to be genuine, correct and

appropriately authorised.




 




19.                               CO-ORDINATING COMMITTEE




 




(a)                                  It is acknowledged by each Lender and by each

Borrowing Group Member that:




 




(i)                                     each Member will be entitled to receive and

retain for its own use and benefit from Borrowing Group Members the fees in

respect of the performance of its respective role as such which have been

agreed prior to the date upon which this Agreement becomes effective;




 




(ii)                                  in connection with this Agreement and the

matters the subject hereof or referred to herein no Lender has relied upon

information or advice provided by any Member and to the extent it has any

relationship with that party in its capacity as a Member, none of the Members

shall be liable to any signatory for any action taken or omitted to be taken or

for the exercise of any discretion by it in connection with any matter

contemplated hereby and shall not be responsible for the efficiency, validity,

enforceability or sufficiency of this Agreement or any matter the subject

hereof or referred to in this Agreement; and




 




(iii)                               the Borrowing Group Members shall be jointly

and severally liable to reimburse each Member for all out-of-pocket expenses

(including the fees of professional advisers appointed to advise the

Co-ordinating Committee) together with value added tax thereon, if any, incurred

by it in connection with the performance of its role as such.




 




(b)                                 The provisions of Clause 12.2 (The Members)

and this Clause 19 shall survive termination of this Agreement and each Member

may rely upon and enforce Clauses 12.2 (The Members), Clause 15.2(b) and this

Clause under the Contracts (Rights of Third Parties Act) 1999.




 




20.                               SEVERABILITY




 




If a provision of any

Finance Document is or becomes illegal, invalid or unenforceable in any

jurisdiction, that shall not affect:




 




(a)                                  the legality, validity or enforceability in

that jurisdiction of any other provision of the Finance Documents; or




 




(b)                                 the legality, validity or enforceability in

other jurisdictions of that or any other provision of the Finance Documents.




 




21.                               COUNTERPARTS




 




Each Finance Document may be

executed in any number of counterparts, and this has the same effect as if the

signatures on the counterparts were on a single copy of the Finance Document.




 




22.                               NOTICES




 




22.1                        Giving of Notices




 




(a)                                  All notices or other communications under or

in connection with the Finance Documents shall be given in writing and, unless

otherwise stated, may be given in person, by post, facsimile or e-mail. Any

such notice will be deemed to be given as follows:




 




(i)                                     if delivered in person, at the time of

delivery;




 




(ii)                                  if posted, five days after being deposited in

the post, postage prepaid, in a correctly addressed envelope;




 




(iii)                               if by facsimile, when received in legible

form; and




 





























 




(iv)                              if by e-mail or any other electronic

communication, when received in legible form.




 




However, a notice given in

accordance with the above but received on a non-working day or after business

hours in the place of receipt will only be deemed to be given on the next

working day in that place.




 




(b)                                 For the purposes of the Finance Documents, an

electronic communication will be treated as being in writing.




 




(c)                                  Unless it is agreed to the contrary, any

consent or agreement required under a Finance Document must be given in

writing.




 




22.2                        Addresses for Notices




 




(a)                                  The address, facsimile number and e-mail

address of each Party (other than the Company and Intercreditor Agent) for all

notices under or in connection with the Finance Documents are those most

recently notified in writing by that Party for this purpose to the

Intercreditor Agent.




 




(b)                                 The contact details of the Company for this

purpose are:




 




Rhodia


26 quai Alphonse le Gallo


92100 Boulogne Billancourt Cedex




 




Facsimile number: +33 (1) 55

38 44 71 / 21




 




Attention: Chief Financial

Officer and General Counsel




 




(c)                                  The contact details of the Intercreditor

Agent for this purpose are:




 




BNP Paribas


European Agency/Middle Office Group


37, Place du Marché St. Honoré


75031 Paris Cedex 01




 




Facsimile number: + 33 (1)

42 98 43 17




 




Attention: Raymond

Banzon/Isabelle Blandin/Catherine Staneso




 




(d)                                 The Intercreditor Agent shall, promptly upon

request from any Party, give to that Party the address, facsimile number or

e-mail address of any other Party applicable at the time for the purposes of

this Clause.




 




22.3                        Obligors




 




(a)                                  All communications under the Finance

Documents to or from an Obligor must be sent through the Intercreditor Agent.




 




(b)                                 All communications under the Finance

Documents to or from an Obligor (other than the Company) must be sent through

the Company.




 




(c)                                  Each Obligor (other than the Company)

irrevocably appoints the Company to act as its agent:




 




(i)                                     to give and receive all communications under

the Finance Documents; and




 




(ii)                                  to sign all documents under or in connection

with the Finance Documents.




 




(d)                                 Any communication given to the Company in

connection with a Finance Document will be deemed to have been given also to

the other Obligors.




 




(e)                                  The Intercreditor Agent may assume that any

communication made by the Company is made with the consent of each other

Obligor.




 





























 




23.                               LANGUAGE




 




(a)                                  Any notice given under or in connection with

any Finance Document shall be in English.




 




(b)                                 Any Existing Facility if not in English shall

if requested by the Intercreditor Agent (acting in good faith) be accompanied

by a certified English translation and, for the purposes of this Agreement

only, the English translation shall prevail unless the document is a statutory

or other official document.




 




(c)                                  All other documents provided under or in

connection with any Finance Document shall be:




 




(i)                                     in English; or




 




(ii)                                  if not in English, accompanied by a certified

English translation and, in this case, the English translation shall prevail

unless the document is a statutory or other official document.




 




24.                               JURISDICTION




 




24.1                        Submission




 




For

the benefit of each Finance Party, each Obligor agrees that:




 




(a)                                  the courts of England have exclusive

jurisdiction to settle any disputes in connection with the Finance Documents

and the English Courts are the most appropriate and convenient courts to settle

any such disputes.




 




(b)                                 Without prejudice to paragraph (a) above and

for the benefit of each Finance Party, each Obligor agrees that any New York

State Court or Federal Court sitting in New York has jurisdiction to settle any

disputes in connection with this Agreement and accordingly submits to the

jurisdiction of those courts.




 




24.2                        Service of process




 




Without

prejudice to any other mode of service, each Obligor not incorporated in

England and Wales:




 




(a)                                  irrevocably appoints Rhodia Limited as its

agent for service of process in relation to any proceedings before the English

courts in connection with any Finance Document;




 




(b)                                 irrevocably appoints Rhodia Inc. as its agent

for service of process, where required, in relation to any proceedings before

any courts located in the State of New York in connection with any Finance

Document;




 




(c)                                  agrees that failure by the process agent to

notify the relevant Obligor of the process will not invalidate the proceedings

concerned;




 




(d)                                 consents to the service of process relating

to any such proceedings by prepaid posting of a copy of the process to its

address for the time being notified under Clause 22 (Notices).




 




If any person appointed as

process agent is unable for any reason to act as agent for service of process,

the Company (on behalf of all the Obligors) must immediately appoint another

agent on terms acceptable to the Intercreditor Agent. Failing this, the

Intercreditor Agent may appoint another agent for this purpose.




 




24.3                        Forum convenience and

enforcement abroad




 




Each Obligor:




 




(a)                                  waives objection to the English and New York

State and Federal Courts on grounds of inconvenient forum or otherwise as

regards proceedings in connection with a Finance Document; and




 




(b)                                 agrees that a judgement or order of an

English or New York State or Federal Court in connection with a Finance

Document is conclusive and binding on it and may be enforced against it in the

courts of any other jurisdiction.




 




24.4                        Non-exclusivity




 




Nothing in this Clause 24

limits the right of any Finance Party to bring proceedings against an Obligor

in connection with the Finance Documents:




 




(a)                                  in any other court of competent jurisdiction;

or




 




(b)                                 concurrently in more than one jurisdiction.




 





























 




25.                               WAIVER OF IMMUNITY




 




25.1                        Waiver of immunity




 




Each Obligor irrevocably and

unconditionally:




 




(a)                                  agrees that if a Finance Party brings

proceedings against it or its assets in relation to the Finance Documents, no

immunity from those proceedings (including, without limitation, suit,

attachment prior to judgement, other attachment, the obtaining of judgement,

execution or other enforcement) will be claimed by or on behalf of itself or

with respect to its assets;




 




(b)                                 waives any such right of immunity which it or

its assets now has or may subsequently acquire; and




 




(c)                                  consents generally in respect of any such

proceedings to the giving of any relief or the issue of any process in

connection with those proceedings, including, without limitation, the making,

enforcement or execution against any assets whatsoever (irrespective of its use

or intended use) of any order or judgment which may be made or given in those

proceedings.




 




25.2                        Waiver of trial by jury




 




THE OBLIGORS AND THE FINANCE

PARTIES WAIVE ANY RIGHTS THEY MAY HAVE TO A JURY TRIAL OR ANY CLAIM OR CAUSE OF

ACTION BASED ON OR ARISING FROM ANY FINANCE DOCUMENT OR THE TRANSACTIONS

CONTEMPLATED BY THE FINANCE DOCUMENTS. IN THE EVENT OF LITIGATION, THIS

AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO TRIAL BY THE COURT.




 




26.                               GOVERNING

LAW




 




This Agreement shall be

governed by English law.




 




This Agreement has been

entered into on the date stated at the beginning of this Agreement.




 





























 




SCHEDULE 1




VARIOUS PARTIES




PART 1




THE

BORROWING GROUP




 




	

  Country


  	

   


  	

  Borrowing

  Group Member


  
	

   


  	

   


  	

   


  
	

  Algeria


  	

   


  	

  RHODIA ALGERIE SPA


  
	

  Belgium


  	

   


  	

  RHODIA BELGIUM (ex

  RHONE-POULENC BELGIQUE)


  
	

  Belgium


  	

   


  	

  RHODIA CHEMIE N.V. (ex

  RHONE-POULENC CHEMIE N.V.)


  
	

  Brazil


  	

   


  	

  RHODIA BRASIL LTDA


  
	

  Brazil


  	

   


  	

  RHODIA POLIAMIDA E

  ESPECIALIDADES LTDA.


  
	

  Canada


  	

   


  	

  RHODIA CANADA INC. (ex

  RHONE-POULENC SPECIALTY CHEMICALS LTD) (ex ALKARIL CANADA LTD)


  
	

  China


  	

   


  	

  RHODIA CHINA CO. LIMITED


  
	

  China


  	

   


  	

  BAOTOU RHODIA RARE EARTH

  COMPANY LTD (ex BAOTOU LUXI RHONE RARE EARTHS CO LTD)


  
	

  China


  	

   


  	

  BEIJING RHODIA EASTERN

  CHEMICAL Co. Ltd (ex Beijing Rhodia Eastern Chemical Co Ltd)


  
	

  China


  	

   


  	

  JADE FINE CHEMICALS (Wuxi)

  Co. Ltd


  
	

  China


  	

   


  	

  LIYANG RHODIA FOUNDER RARE

  EARTH NEW MATERIAL CO LTD


  
	

  China


  	

   


  	

  RHODIA HENGCHANG

  (ZHANGJIAGANG) SPECIALTY CHEMICAL CO. LTD


  
	

  China


  	

   


  	

  RHODIA INTERNATIONAL

  TRADING


  
	

  China


  	

   


  	

  RHODIA SILICA QINGDAO Co

  Ltd (ex Rhodia Qingdao Silica Co Ltd)


  
	

  China


  	

   


  	

  RHODIA SPECIALTY CHEMICALS

  WUXI Co Ltd (ex RHONE-POULENC SPECIALTY CHEMICALS WUXI Co Ltd)


  
	

  China


  	

   


  	

  RHODIA WUXI PHARMACEUTICAL

  CO. LTD


  
	

  China


  	

   


  	

  RUOHAI (ZHEJIANG) FINE

  CHEMICALS CO. LTD


  
	

  China


  	

   


  	

  SHANGHAI LONGMA

  ENGINEERING PLASTICS CO LTD


  
	

  China


  	

   


  	

  YINGKOU YINGLONG CHEMICAL FIBER

  COMPANY LIMITED


  
	

  Colombia


  	

   


  	

  RHODIA COLOMBIA LTDA


  
	

  Denmark


  	

   


  	

  RHODIA DANMARK A/S


  
	

  Egypt


  	

   


  	

  RHODIA EGYPT CHEMICALS

  S.A.E. (ex RP EGYPT CHEMICALS)


  
	

  Egypt


  	

   


  	

  RHODIA EGYPT DISTRIBUTION


  
	

  France


  	

   


  	

  RHODIA S.A.


  
	

  France


  	

   


  	

  NOVACARB (ex Rhod M)


  
	

  France


  	

   


  	

  ORELIS (ex TECH SEP)


  
	

  France


  	

   


  	

  RHODIA ACETOL (ex

  RHONE-POULENC ACETOL)


  
	

  France


  	

   


  	

  RHODIA CHIMIE (ex

  RHONE-POULENC CHIMIE)


  
	

  France


  	

   


  	

  RHODIA ECO SERVICES (ex

  RHODIA FIN)


  
	

  France


  	

   


  	

  RHODIA ELECTRONICS AND

  CATALYSIS (ex Rhodia Terres Rares)


  
	

  France


  	

   


  	

  RHODIA ENERGY (ex RHOD E)


  
	

  France


  	

   


  	

  RHODIA ENGINEERING

  PLASTICS S.A.S.


  
	

  France


  	

   


  	

  RHODIA ETANCHEITE (ex

  RHONE-POULENC ETANCHEITE FRANCE)


  
	

  France


  	

   


  	

  RHODIA FOOD (ex TEXEL)


  
	

  France


  	

   


  	

  RHODIA HPCII (ex RHOD C)


  
	

  France


  	

   


  	

  RHODIA INTERMEDIAIRES (ex

  RHOD F)


  
	

  France


  	

   


  	

  RHODIA ORGANIQUE (ex RHONE

  J)


  
	

  France


  	

   


  	

  RHODIA P.I. BELLE ETOILE

  (ex RHODIA BELLE ETOILE)


  
	

  France


  	

   


  	

  RHODIA P.I. CHALAMPE (ex

  RHODIA ALSACHIMIE)


  
	

  France


  	

   


  	

  RHODIA PERFORMANCE FIBRES


  
	

  France


  	

   


  	

  RHODIA POLYAMIDE

  INTERMEDIATES (ex RHODIA FIBER AND RESIN INTERMEDIATES)


  
	

  France


  	

   


  	

  RHODIA PPMC (ex BEVALOID)


  
	

  France


  	

   


  	

  RHODIA RECHERCHES (ex RP

  RECHERCHES)


  
	

  France


  	

   


  	

  RHODIA SERVICES (ex

  RHODIA)


  
	

  France


  	

   


  	

  RHODIA SILICES (ex RHOD B)


  
	

  France


  	

   


  	

  RHODIA SILICONES (ex RHOD

  A)


  
	

  France


  	

   


  	

  RHODIGAZ


  
	

  France


  	

   


  	

  RHODITECH (ex RHOD D)


  
	

  Germany


  	

   


  	

  RHODIA ACETOW GMBH (ex

  RHONE-POULENC RHODIA AG)


  
	

  Germany


  	

   


  	

  RHODIA DEUTSCHLAND GmbH

  (ex RHONE-POULENC DEUTSCHLAND GmbH)


  
	

  Germany


  	

   


  	

  RHODIA SILICON GmbH (ex

  RHONE-POULENC SILICON GMBH)


  
	

  Great-Britain


  	

   


  	

  RHODIA CONSUMER

  SPECIALTIES LIMITED (ex Albright & Wilson UK Ltd)


  
	

  Great-Britain


  	

   


  	

  RHODIA ECO SERVICES

  LIMITED (ex Staveley Chemicals Ltd)


  
	

  Great-Britain


  	

   


  	

  RHODIA FOOD UK LIMITED (ex

  Sisyphus 014 Ltd)


  
	

  Great-Britain


  	

   


  	

  RHODIA HPCII UK LIMITED

  (ex Sisyphus 013 Ltd)


  
	

  Great-Britain


  	

   


  	

  RHODIA INDUSTRIAL

  SPECIALTIES (ex Sisyphus 012 Ltd)


  
	

  Great-Britain


  	

   


  	

  RHODIA LIMITED (ex

  Rhône-Poulenc Chemicals Ltd)


  
	

  Great-Britain


  	

   


  	

  RHODIA ORGANIQUE FINE

  LIMITED (ex Sisyphus 011 Ltd)


  
	

  Great-Britain


  	

   


  	

  RHODIA PHARMA SOLUTIONS

  LIMITED (ex Rhodia Chirex Ltd)


  
	

  Great-Britain


  	

   


  	

  RHODIA SEALANTS LIMITED

  (ex Rhône-Poulenc Vispak Ltd)


  
	

  Greece


  	

   


  	

  RHODIA HELLAS SA (ex

  Rhône-Poulenc Hellas S.A.)


  
	

  Guatemala


  	

   


  	

  RHODIA DE CENTROAMERICA

  S/A (EX— RHODIA GUATEMALA)


  
	

  Hong Kong


  	

   


  	

  RHODIA HONG KONG LIMITED

  (ex Rhône-Poulenc Asia Ltd)


  
	

  India


  	

   


  	

  ALBRIGHT & WILSON

  CHEMICALS INDIA LIMITED (ex Albright Morarji and Pandit Ltd)


  
	

  India


  	

   


  	

  RHODIA CHEMICALS INDIA LTD

  (ex Rhône-Poulenc Chemicals (India) Ltd)


  
	

  Italy


  	

   


  	

  RHODIA ENGINEERING

  PLASTICS Srl


  
	

  Italy


  	

   


  	

  RHODIA GERONAZZO SpA (ex

  RHONE-POULENC GERONAZZO Spa)


  
	

  Italy


  	

   


  	

  RHODIA ITALIA S.p.A. (ex

  Rhône-Poulenc Chimica)


  
	

  Italy


  	

   


  	

  RHODIA PERF FIBRES s.r.l.


  
	

  Italy


  	

   


  	

  RHODIA SILICONI ITALIA


  
	

  Ivory Coast


  	

   


  	

  RHODIA OUEST AFRIQUE


  
	

  Japan


  	

   


  	

  ANAN KASEI CO., LTD


  
	

  Japan


  	

   


  	

  RHODIA JAPAN LTD


  
	

  Japan


  	

   


  	

  RHODIA NICCA Ltd (ex

  RHONE-POULENC NICCA)


  
	

  Korea (South)


  	

   


  	

  RHODIA SILICA KOREA (ex

  Rhodia Kofran Ltd)


  
	

  Korea (South)


  	

   


  	

  RHODIA KOREA LTD (ex

  Rhône-Poulenc Korea Ltd)


  
	

  Korea (South)


  	

   


  	

  RHODIA POLYAMIDE CO Ltd


  
	

  Lebanon


  	

   


  	

  RHODIA MASHREK (ex Rhodia

  Liban Sal)


  
	

  Malaysia


  	

   


  	

  ALBRIGHT & WILSON

  (MALAYSIA) Sdn Bhd (ex Josen Chemical Sdn Bhd) / Rhodia Consummer Specialties

  (?)


  
	

  Malaysia


  	

   


  	

  RHODIA MALAYSIA SDN.BHD

  (ex RHONE-POULENC MALAYSIA SDN.BHD)


  
	

  Malaysia


  	

   


  	

  RHODIA SILICONES MALAYSIA

  SDN BHD (formerly Rhône-Poulenc Malaysia Sdn Bhd)


  
	

  Mexico


  	

   


  	

  RHODIA FOSFATADOS DE

  MEXICO S.A. DE CV


  
	

  Morocco


  	

   


  	

  RHODIA MAROC (ex

  RHONE-POULENC MAROC)


  
	

  Peru


  	

   


  	

  RHODIA PERU S/A


  
	

  Philippines


  	

   


  	

  RHODIA PHILIPPINES INC.


  
	

  Poland


  	

   


  	

  RHODIA FOOD BIOLACTA

  Sp.z.o.o. (ex BIOLACTA TEXEL)


  
	

  Romania


  	

   


  	

  RHODIA ROMANIA SRL (ex

  Rhône-Poulenc Romania SRL)


  
	

  Singapore


  	

   


  	

  RHODIA ASIA PACIFIC PTE

  LTD (ex Rhodia Consumer Specialties Asia Pacific Pte Ltd)


  
	

  Singapore


  	

   


  	

  RHODIA SINGAPORE PTE LTD

  (ex Rhône-Poulenc Singapore Pte Ltd)


  
	

  Slovak Republic


  	

   


  	

  RHODIA INDUSTRIAL YARNS,

  a.s.


  
	

  South Africa


  	

   


  	

  RHODIA SOUTH AFRICA (PTY)

  Ltd (ex RHONE-POULENC SOUTH AFRICA (PTY) LTD)


  
	

  Spain


  	

   


  	

  RHODIA HOME, PERSONAL CARE

  AND INDUSTRIAL INGREDIENTS ESPANA SA


  
	

  Spain


  	

   


  	

  RHODIA IBERIA SA (ex

  RHONE-POULENC INDUSTRIAL SA)


  
	

  Spain


  	

   


  	

  RHODIA IBERLATEX


  
	

  Spain


  	

   


  	

  RHODIA SILICONAS ESPANA

  S.A.


  
	

  Sweden


  	

   


  	

  RHODIA SVERIGE AB (ex

  Rhône-Poulenc Sverige AB)


  
	

  Switzerland


  	

   


  	

  RHODIA CAPITAL MARKET (ex

  RHONE-POULENC (SUISSE) S.A.)


  
	

  Switzerland


  	

   


  	

  RHODIA INDUSTRIAL YARNS

  A.G. (ex RHODIA FILTEC A.G.)


  
	

  Taiwan


  	

   


  	

  RHODIA ENGINEERING

  PLASTICS Co, Ltd


  
	

  Thailand


  	

   


  	

  RHODIA PPMC THAILAND (ex

  Awat Thai Ltd)


  
	

  Thailand


  	

   


  	

  RHODIA THAI INDUSTRIES LTD

  (ex Rhône-Poulenc Thai Industries Ltd)


  
	

  Thailand


  	

   


  	

  RHODIA THAILAND LTD (ex

  Rhône-Poulenc Chemicals (Thailand) Ltd)


  
	

  United Arab Emirates


  	

   


  	

  RHODIA FZE (ex Rhodia

  Trading FZE)


  
	

  United States


  	

   


  	

  PRIMESTER


  
	

  United States


  	

   


  	

  RHODIA ELECTRONICS AND

  CATALYSIS INC.


  
	

  United States


  	

   


  	

  RHODIA INC


  
	

  Venezuela


  	

   


  	

  RHODIA ACETOW VENEZUELA

  C.A.


  
	

  Venezuela


  	

   


  	

  RHODIA SILICES DE

  VENEZUELA C.A.


  





 





























 




PART 2




THE

ORIGINAL OBLIGORS




 




	

  Country


  	

   


  	

  Original

  Obligors


  
	

   


  	

   


  	

   


  
	

  Brazil


  	

   


  	

  RHODIA POLIAMIDA E

  ESPECIALIDADES LTDA.


  
	

  China


  	

   


  	

  RHODIA HENGCHANG

  (ZHANGJIAGANG) SPECIALTY CHEMICAL CO. LTD


  
	

  China


  	

   


  	

  RHODIA WUXI PHARMACEUTICAL

  CO. LTD


  
	

  China


  	

   


  	

  RHODIA CHINA CO. LIMITED


  
	

  France


  	

   


  	

  RHODIA S.A.


  
	

  Japan


  	

   


  	

  RHODIA JAPAN LTD


  
	

  Mexico


  	

   


  	

  RHODIA FOSFATADOS DE

  MEXICO S.A. DE CV


  
	

  Switzerland


  	

   


  	

  RHODIA CAPITAL MARKET (ex

  RHONE-POULENC (SUISSE) S.A.)


  
	

  Taiwan


  	

   


  	

  RHODIA ENGINEERING

  PLASTICS Co, Ltd


  
	

  United States


  	

   


  	

  RHODIA INC


  
	

  Venezuela


  	

   


  	

  RHODIA ACETOW VENEZUELA

  C.A.


  





 





























 




PART 3




ORIGINAL

LENDERS




 




	

  BNP PARIBAS


  
	

  CRÉDIT LYONNAIS S.A.


  
	

  CRÉDIT INDUSTRIEL ET

  COMMERCIAL


  
	

  BANQUE DE L’ECONOMIE DU

  COMMERCE ET DE LA MONETIQUE


  
	

  CSFB


  
	

  WACHOVIA


  
	

  BAYERISCHE LANDESBANK


  
	

  SOCIÉTÉ GÉNÉRALE


  
	

  THE BANK OF

  TOKYO-MITSUBISHI, LTD.


  
	

  FORTIS BANK N.V.


  
	

  NATEXIS BANQUES POPULAIRES


  
	

  CCF


  
	

  STANDARD CHARTERED BANK


  
	

  THE ROYAL BANK OF SCOTLAND

  PLC


  
	

  BANCO BILBAO VIZCAYA

  ARGENTARIA


  
	

  JPMORGAN CHASE BANK


  
	

  ING BANK N.V.


  
	

  UNICREDITO ITALIANO


  
	

  UFJ BANK NEDERLAND N.V.


  
	

  UFJ BANK LIMITED


  
	

  CITIBANK INTERNATIONAL PLC


  
	

  LANDES GIROZENTRALE


  
	

  COMERICA


  





 




PART 4




FACILITY

AGENTS




 




BNP PARIBAS




 





























 




SCHEDULE 2




CONDITIONS PRECEDENT DOCUMENTS




 




PART 1




CONDITIONS PRECEDENT DOCUMENTS TO BE PROVIDED IN FORM AND

SUBSTANCE SATISFACTORY




TO EACH ORIGINAL LENDER ARE MARKED WITH AN ASTERISK (*)




 




1.                                      Authorisations




 




1.1                                 A copy of the memorandum and articles of

association, certificate of incorporation and certificate of incorporation on

change of name (if any) or any other constitutional document of each Original

Obligor including, for any Original Obligor incorporated in France, a K-bis

extract from the Trade and Companies Registry related to it.




 




1.2                                 A copy of a resolution of the board of directors

of each Original Obligor authorising the entry into, execution and performance

of this Agreement and the Finance Documents to which it is a party, and related

or ancillary documents and authorising specified persons to execute those on

its behalf.




 




1.3                                 A certificate of an authorised signatory of

each Original Obligor or the Company on behalf of each Original Obligor

certifying:




 




(a)                                  that each document delivered under this

Schedule is correct, complete and in full force and effect as at a date no earlier

than the date of this Agreement;




 




(b)                                 that the execution of and assumption of

obligations under the Finance Documents will not result in any breach of any

restriction binding on that Obligor;




 




(c)                                  as to the identity and specimen signatures of

the directors and signatories of that Original Obligor;




 




(d)                                 that no Default is outstanding relating to

it; and




 




(e)                                  that the representations and warranties made

by it in the Finance Documents are correct.




 





























 




2.                                      Financial Information




 




(a)                                  A copy of the Original Financial Statements.




 




(b)                                 Consolidated management accounts, consisting

of a balance sheet, profit and loss account and cashflow for the Company.




 




(c)                                  * The final version (updated from the draft of

November, 2003) of the due diligence report of Ernst & Young dated 28th

November, 2003 together with confirmation from Ernst & Young that it can be

relied upon by the Finance Parties in form and substance satisfactory to the

Lenders.




 




3.                                      Agreements and documents




 




(a)                                  An original of this Agreement executed by each

Party.




 




(b)                                 An original of the Fee Letter(s) and the

letter attaching the agreed form of the Refinancing Facilities Term Sheet and

each Affected Facilities Agreement listed under heading “Committed Bank lines”

in Schedule 3, Securitisation Programme and Lease Facilities.




 




(c)                                  * An original of the agreed form of the

Refinancing Facilities Term Sheet.




 




(d)                                 Evidence that the amendments referred to in

Schedule 9 (Agreed Lease Amendments Principles) have become effective or waiver

and consent letters (and notices of satisfaction with conditions precedent

thereto where applicable) from each of the lessors under the Lease Facilities

to (i) this Agreement, (ii) the Agreed Lease Amendment Principles, (iii) the

Agreed Security Principles and (iv) the Refinancing Facilities Term Sheet.




 




4.                                      Legal opinions




 




* A legal opinion in the agreed form of

Shearman & Sterling LLP, legal advisers to the Company and the Obligors,

addressed to the Finance Parties in respect of the Company and Rhodia Inc.




 




5.                                      Miscellaneous




 




(a)                                  Confirmation that no insolvency proceedings

of the type referred to in Clauses 11.7 (Insolvency) and 11.12 (Analogous

proceedings) have been commenced against any Obligor or Material Subsidiary.




 




(b)                                 Evidence that any process agent referred to

in Clause 24.2 (Service of process) has accepted its appointment to be

appointed under this Agreement.




 




(c)                                  Evidence that all fees, expenses and costs

properly incurred and then due to any of the Finance Parties, the Lenders, the

Members and their legal advisors have been paid in full.




 




(d)                                 * Evidence that (A) an amount equal to 5 per

cent. of the Exposure under each of the Affected Facilities listed under the

heading “Prepayable” in Schedule 3 and calculated by reference to the amount

set out under the heading “Exposure” in Schedule 3 in respect of each Affected

Facility has been prepaid and corresponding commitment cancelled; and (B) the

Derivative Deposit (if any) in respect of each Lender (or Affiliate) which has

executed this Agreement has been deposited with the relevant Lender (or its

Affiliate).




 




(e)                                  * A copy of the Original Business Plan

(including liquidity/analysis).




 




(f)                                    A copy of the Group Structure Chart.




 




(g)                                 * Evidence of the status of the renegotiation

for the maintenance of and relevant waivers of covenants under the

Securitisation Programmes and back-up lines and USPP amendment discussions.




 




(h)                                 Due diligence reports with respect to the

Facility Agreements by Shearman & Sterling and Jones Day.




 




(i)                                     Information regarding cash pooling.




 




(j)                                     A copy of any other authorisation or other

document, opinion or assurance which the Intercreditor Agent has notified the

Company is considered in good faith to be necessary at that time in connection

with the entry into and performance of, and the transactions contemplated by,

any Transaction Document or for the validity and enforceability of any

Transaction Document.




 





























 




PART 2




CONDITIONS

PRECEDENT DOCUMENTS




 




In respect of the Security

Documents, Security Sharing Agreement or Subordination Agreement as the case

may be (the Relevant Documents)




 




1.                                      Relevant Documents




 




An original of each executed

Relevant Document.




 




2.                                      Authorisations




 




2.1                                 A copy of the memorandum and articles of

association, certificate of incorporation and certificate of incorporation on

change of name (if any) or any other constitutional document of each member of

the Group party to the Relevant Document including, for any party incorporated

in France, a K-bis extract from the Trade and Companies Registry related to it

(to the extent not already supplied under Schedule 2 Part 1).




 




2.2                                 A copy of a resolution of the board of

directors of each member of the Group party to the Relevant Documents

authorising the entry into, execution and performance of the Relevant Documents

to which it is a party, and related or ancillary documents and authorising

specified persons to execute those on its behalf.




 




2.3                                 A certificate of an authorised signatory of

each member of the Group party to the Relevant Documents certifying:




 




(a)                                  that each document delivered under this

Schedule is correct, complete and in full force and effect as at a date no

earlier than the date of the Relevant Document;




 




(b)                                 that the execution of and assumption of its

obligations under the Relevant Documents will not result in any breach of any

restriction binding on it;




 




(c)                                  as to the identity and specimen signatures of

its directors and signatories;




 




(d)                                 that no Default is outstanding relating to

it; and




 




(e)                                  that the representations and warranties made

by it in the Relevant Documents are correct.




 




3.                                      Security Documents




 




(a)                                  At least 2 copies (or, if required in the

relevant jurisdiction, such additional copies as are requested by the Finance

Parties) of the Security Documents to be entered into in accordance with the

Agreed Security Principles, each duly executed by the parties to it.




 




(b)                                 Registration requirements of Security

Documents effected.




 




(c)                                  Documents necessary for perfection of

Security Documents.




 




(d)                                 A copy of all notices required to be sent

under the Security Documents.




 




(e)                                  A copy of all transfers, share certificates

and stock transfer forms or equivalent relating to assets charged by the

Security Documents.




 




(f)                                    Evidence that each creditor has waived in

writing any negative pledge or other restriction in its favour that would or

could be breached by any member of the Group entering into the Security

Documents.




 




(g)                                 Copies of the Secured Intra Group Loans in an

agreed form.




 




4.                                      Legal opinions




 




(a)                                  A legal opinion in the agreed form of

Shearman & Sterling, legal advisers to the Company and the Obligors,

addressed to the Finance Parties.




 




(b)                                 Other legal opinions in the agreed form from

legal advisors to the Company or the Lenders with respect to the Security

Documents to be entered into as the Intercreditor Agent or Security Agent

considers desirable (acting in good faith).




 




5.                                      Miscellaneous




 




(a)                                  Evidence that any process agent referred to

in the Relevant Document has accepted its appointment to be appointed

thereunder.




 




(b)                                 Evidence that all fees, expenses and costs

properly incurred and then due to any of the Finance Parties, or other

creditors party to a Relevant Document, the Members and their legal advisors

have been paid in full.




 




(c)                                  A copy of any other authorisation or other

document, opinion or assurance which the Intercreditor Agent or Security Agent

(as the case may be) has notified the Company is considered in good faith to be

necessary in connection with the entry into and performance of, and the

transactions contemplated by, any Relevant Document or for the validity and

enforceability of any Relevant Document.




 





























 




PART 3




ADDITIONAL OBLIGOR CONDITIONS PRECEDENT DOCUMENTS




 




1.                                      An Accession Agreement duly executed by the

Company and the Additional Obligor.




 




2.                                      Authorisations




 




2.1                                 A copy of the memorandum and articles of

association, certificate of incorporation and certificate of incorporation on

change of name (if any) or any other constitutional document of each Additional

Obligor including, for any Additional Obligor incorporated in France, a K-bis

extract from the Trade and Companies Registry related to it.




 




2.2                                 A copy of a resolution of the board of

directors of each Additional Obligor authorising the entry into, execution and

performance of this Agreement and the Finance Documents to which it is a party,

and related or ancillary documents and authorising specified persons to execute

those on its behalf.




 




2.3                                 A certificate of an authorised signatory of

each Additional Obligor certifying:




 




(a)                                  that each document delivered under this

Schedule is correct, complete and in full force and effect as at a date no

earlier than the date of the Accession Agreement;




 




(b)                                 that the execution of and assumption of

obligations under the Finance Documents will not result in any breach of any

restriction binding on that Obligor;




 




(c)                                  as to the identity and specimen signatures of

the directors and signatories of that Additional Obligor;




 




(d)                                 that no Default is outstanding relating to

it; and




 




(e)                                  that the representations and warranties made

by it in the Finance Documents are correct.




 




3.                                      A legal opinion from legal advisers to the

Company with respect to the entry into of the Finance Documents by that

Additional Obligor with respect to the law of the place of its incorporation.




 




4.                                      Miscellaneous




 




(a)                                  Evidence that any process agent referred to

in the Finance Documents has accepted its appointment to be appointed

thereunder.




 




(b)                                 Evidence that all fees, expenses and costs

properly incurred and then due to any of the Finance Parties, or other

creditors party to a Finance Document, the Members and their legal advisors

have been paid in full.




 




(c)                                  A copy of any other authorisation or other

document, opinion or assurance which the Intercreditor Agent or Security Agent

(as the case may be) has notified the Company is considered in good faith to be

necessary in connection with the entry into and performance of, and the

transactions contemplated by, any Finance Document or for the validity and

enforceability of any Finance Document.




 





























 




Any text that has been deleted pursuant to

Rhodia's confidential treatment request is marked [“***”] herein and has been

separately submitted with the U.S. Securities and Exchange Commission.




 




SCHEDULE 3




THE EXISTING FACILITIES, AFFECTED FACILITIES AND EXPOSURES




 




[***]




 






















[3 PAGES DELETED, INCLUDING THIS PAGE, AND

FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED

WITH RESPECT TO THE OMITTED SCHEDULE.]




 





























 




SCHEDULE 4




SECURITY - EXISTING SECURITY INTERESTS




 




Existing Security Interests




 




More than 50% owned Subsidiaries




 




	

  Mature of the security interest


  	

   


  	

  Entity

  Enterprises


  	

   


  	

  Beneficiary


  	

   


  	

  Amount


  (EUR)


  	

   


  	

  Purpose*


  	

   


  
	

  Cash Deposit


  	

   


  	

  Rhodia

  Engineering  Plastics Taiwan Co. Ltd.


  	

   


  	

  BNP Paribas


  	

   


  	

  50,844


  	

   


  	

  NO


  	

   


  
	

  Fixed assets Mortgage


  	

   


  	

  Baotou

  Rhodia Rare Earth Co. Ltd.


  	

   


  	

  Bank of

  China


  	

   


  	

  2,968,668


  	

   


  	

  YES


  	

   


  
	

  Cash deposit


  	

   


  	

  Rhodia Wuxi

  Pharmaceutical Co. Ltd.


  	

   


  	

  Bank of

  China


  	

   


  	

  70,512


  	

   


  	

  YES


  	

   


  
	

  Cash deposit


  	

   


  	

  Rhodia

  Finance International B.V.


  	

   


  	

  Natexis

  Banques Popularies]


  	

   


  	

  10,579,529


  	

   


  	

  NO


  	

   


  
	

  Mortgage


  	

   


  	

  Rhodia

  Brazil


  	

   


  	

  Social

  Security Authority


  	

   


  	

  1,611,303


  	

   


  	

  NO


  	

   


  
	

  Equipments


  	

   


  	

  Rhodia

  Poliamida & Especialidados


  	

   


  	

  Tax Judicial

  Proceedings


  	

   


  	

  848,064


  	

   


  	

  NO


  	

   


  
	

  Cash deposit


  	

   


  	

  Rhodia

  Brazil + Rhodia Poliamida & Especialidados


  	

   


  	

  Judicial

  Proceedings


  	

   


  	

  9,490,208


  	

   


  	

  NO


  	

   


  
	

  Fixed Assets


  	

   


  	

  Rhodia

  Mexicana SA de CV


  	

   


  	

  Mexican

  Customs


  	

   


  	

  31,015,508


  	

   


  	

  NO


  	

   


  
	

  Cash deposit


  	

   


  	

  Rhodia SA


  	

   


  	

  Natexis


  	

   


  	

  1,491,000


  	

   


  	

  NO


  	

   


  
	

  Collateral Cash


  	

   


  	

  Rhodia

  Italia


  	

   


  	

  Mediobanca


  	

   


  	

  11,924,291


  	

   


  	

  NO


  	

   


  
	

  Cash Deposit


  	

   


  	

  Rhodia

  Silicones


  	

   


  	

  Credit

  Mutual-Sales of Receivables


  	

   


  	

  256,602


  	

   


  	

  NO


  	

   


  
	

  Cash Deposit


  	

   


  	

  Rhodia

  Silicas


  	

   


  	

  Credit

  Mutual-Sales of Receivables


  	

   


  	

  621,647


  	

   


  	

  NO


  	

   


  
	

  Cash Deposit


  	

   


  	

  Rhodia PPMC


  	

   


  	

  Credit

  Mutual-Sales of Receivables


  	

   


  	

  1,180,711


  	

   


  	

  NO


  	

   


  
	

  Cash Deposit


  	

   


  	

  Rhodia HPCII


  	

   


  	

  Credit

  Mutual-Sales of Receivables


  	

   


  	

  —


  	

   


  	

  NO


  	

   


  
	

  Cash Deposit


  	

   


  	

  Rhodia

  Polyamide Intermediates


  	

   


  	

  Credit

  Mutual-Sales of Receivables


  	

   


  	

  2,454,177


  	

   


  	

  NO


  	

   


  
	

  Cash Deposit


  	

   


  	

  Rhodia

  Performances Fibres


  	

   


  	

  Credit

  Mutual-Sales of Receivables


  	

   


  	

  20,083


  	

   


  	

  NO


  	

   


  
	

  Cash Deposit


  	

   


  	

  Rhodia

  Electronics & Catalysis


  	

   


  	

  Credit

  Mutual-Sales of Receivables


  	

   


  	

  783,884


  	

   


  	

  NO


  	

   


  
	

  Cash Deposit


  	

   


  	

  Rhodiatech


  	

   


  	

  Credit

  Mutual-Sales of Receivables


  	

   


  	

  160,860


  	

   


  	

  NO


  	

   


  
	

  Cash Deposit


  	

   


  	

  Rhodia Pi

  Belle Etoille


  	

   


  	

  Credit

  Mutual-Sales of Receivables


  	

   


  	

  140,565


  	

   


  	

  NO


  	

   


  
	

  Cash Deposit


  	

   


  	

  Rhodia Pi

  Chalampe


  	

   


  	

  Credit

  Mutual-Sales of Receivables


  	

   


  	

  12,963


  	

   


  	

  NO


  	

   


  
	

  Cash Deposit


  	

   


  	

  Rhodia Acetol


  	

   


  	

  Credit

  Mutual-Sales of Receivables


  	

   


  	

  164,195


  	

   


  	

  NO


  	

   


  
	

  Cash Deposit


  	

   


  	

  RHODIA

  ENERGY


  	

   


  	

  Credit

  Mutual-Sales of Receivables


  	

   


  	

  172,817


  	

   


  	

  NO


  	

   


  
	

  Cash Deposit


  	

   


  	

  RHODIA ECO

  SERVICES SULFURIQUE


  	

   


  	

  Credit

  Mutual-Sales of Receivables


  	

   


  	

  1,540,766


  	

   


  	

  NO


  	

   


  
	

  Cash deposit


  	

   


  	

  Rhodia Asia

  Pacifique Pte Ltd


  	

   


  	

  Standard

  Chartered Bank


  	

   


  	

  32,053


  	

   


  	

  NO


  	

   


  
	

  Cash deposit


  	

   


  	

  Albright

  & Wilson Chemicals India Ltd


  	

   


  	

  Various

  (electricity, Water, phone...)


  	

   


  	

  166,911


  	

   


  	

  NO


  	

   


  
	

  Total More than 50% owned Subsidiaries


  	

   


  	

   


  	

   


  	

   


  	

   


  	

  77,847,434


  	

   


  	

   


  	

   


  





 




Relevant Entities (less than 50% owned)

listed in Schedule 1




 




	

  Mature of the security interest


  	

   


  	

  Entity

  Enterprises


  	

   


  	

  Beneficiary


  	

   


  	

  Amount


  (EUR)


  	

   


  	

  Purpose*


  	

   


  
	

  Fixed assets


  	

   


  	

  Liyang

  Rhodia Founder Rare Earth Co. Ltd


  	

   


  	

  Banques

  chinoises (ICBC,ABC, UAC)


  	

   


  	

  20,055,604


  	

   


  	

  YES


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

  Total Relevant Entities (less than 50%

  owned)


  	

   


  	

   


  	

   


  	

   


  	

   


  	

  20,055,604


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

  TOTAL


  	

   


  	

   


  	

   


  	

   


  	

   


  	

  97,903,038


  	

   


  	

   


  	

   


  





 






















* YES if realted to financial

debt of Subsidiaries more than 50% owned or relevant Entities listed in

Schedule 1




 




95





























 




SCHEDULE 5




ACCESSION AGREEMENT




 




	

  To:


  	

  [INTERCREDITOR AGENT] as

  Intercreditor Agent


  
	

  From:


  	

  [PROPOSED

  LENDER][ADDITIONAL OBLIGOR] [and Company]


  





 




 




RHODIA

S.A.-Secured Co-ordination Agreement dated

[          ] (the Secured

Co-ordination Agreement).




 




We refer to the Secured Co-ordination

Agreement. This is an Accession Agreement.




 




Capitalised terms used in this Accession

Agreement have the same meaning as in the Secured Co-ordination Agreement.




 




We [Lender][Additional Obligor] hereby agree

to become a party to:




 




(a)                                  the Secured Co-ordination Agreement;




 




(b)                                 the Security Sharing Agreement; and




 




(c)                                  the Subordination Agreement.




 




(together the Agreements),




 




as * [a Lender][an Additional Obligor] and to

be bound by and comply with the terms of the Agreements as a

[Lender][Additional Obligor] in accordance with the terms of the Secured

Co-ordination Agreement.




 




[We confirm that as at

[                    ]

[today’s date] the following principal amounts were owing [to/by us] under the

following Facilities.




 




Details of Facility Principal Exposure




 




[                        ]

[                        ]

[**]




 




Our address for notices for the purposes of

the Secured Co-ordination Agreement is:




 




[                                                   ]




 




This Agreement is governed by English law.




 




[Appropriate execution provision for

Lender]***




 




Company




 




RHODIA S.A.




 




By:




 






















* Complete as applicable




 





























 




Any

text that has been deleted pursuant to Rhodia’s confidential treatment request

is marked [“***”] herein and has been separately submitted with the U.S.

Securities and Exchange Commission.




 




SCHEDULE 6




BUSINESS PLAN INCLUDING LIQUIDITY ANALYSIS




PART 1




RHODIA BUSINESS PLAN AFTER DISPOSALS




 




[***]




 






















[2 PAGES DELETED, INCLUDING THIS PAGE, AND

FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED

WITH RESPECT TO THE OMITTED PART OF THE SCHEDULE.]




 





























 




Any

text that has been deleted pursuant to Rhodia’s confidential treatment request

is marked [“***”] herein and has been separately submitted with the U.S.

Securities and Exchange Commission.




 




PART 2




LIQUIDITY

ANALYSIS




 




[***]




 






















[2 PAGES DELETED, INCLUDING THIS PAGE, AND

FILED SEPARATELY WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED

WITH RESPECT TO THE OMITTED PART OF THE SCHEDULE.]




 





























 




SCHEDULE 7




INTER-COMPANY LOANS




 




PART 1




INTERCOMPANY

LOANS/BORROWINGS BETWEEN RHODIA S.A. AND ITS SUBSIDIARIES




 




	

  Transaction


  	

   


  	

  Consolidation

  method


  	

   


  	

  Subsidiary


  	

   


  	

  Drawdown


  	

   


  	

  Maturity


  	

   


  	

  Interest


  	

   


  	

  Nominal

  Amount


  	

   


  	

  Currency


  Rate


  	

   


  	

  Closing

  Price


  	

   


  	

  Closing

  Amount


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Albright & Wilson

  Chemicals Pty Ltd


  	

   


  	

  21/11/03


  	

   


  	

  19/12/03


  	

   


  	

  5.07


  	

   


  	

  15,633,693.18


  	

   


  	

  AUD


  	

   


  	

  /1.65830


  	

   


  	

  9,427,542.17


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Performance Fibres

  GmbH


  	

   


  	

  28/11/03


  	

   


  	

  30/01/04


  	

   


  	

  2.645


  	

   


  	

  63,355.78


  	

   


  	

  CAD


  	

   


  	

  /1.55520


  	

   


  	

  40,738.03


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Non-conslidated


  	

   


  	

  Rhodia Financial Services


  	

   


  	

  21/11/03


  	

   


  	

  19/12/03


  	

   


  	

  0.055


  	

   


  	

  800,262.28


  	

   


  	

  CHF


  	

   


  	

  /1.54840


  	

   


  	

  516,831.75


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Industrial Yarns AG


  	

   


  	

  21/11/03


  	

   


  	

  15/12/03


  	

   


  	

  0.06333


  	

   


  	

  29,418,426.88


  	

   


  	

  CHF


  	

   


  	

  /1.54840


  	

   


  	

  18,999,242.37


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Industrial Yarns AG


  	

   


  	

  28/11/03


  	

   


  	

  15/12/03


  	

   


  	

  0.18


  	

   


  	

  3,500,000.00


  	

   


  	

  CHF


  	

   


  	

  /1.54840


  	

   


  	

  2,260,397.83


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Industrial Yarns AG


  	

   


  	

  27/11/03


  	

   


  	

  03/12/03


  	

   


  	

  0.05167


  	

   


  	

  15,000,000.00


  	

   


  	

  CHF


  	

   


  	

  /1.54840


  	

   


  	

  9,687,419.27


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Industrial Yarns AG


  	

   


  	

  28/11/03


  	

   


  	

  15/12/03


  	

   


  	

  0.04833


  	

   


  	

  1,066,139.70


  	

   


  	

  CHF


  	

   


  	

  /1.54840


  	

   


  	

  688,542.82


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Participation Et de Gestion


  	

   


  	

  30/06/03


  	

   


  	

  30/12/03


  	

   


  	

  0.01


  	

   


  	

  21,337,992.07


  	

   


  	

  CHF


  	

   


  	

  /1.54840


  	

   


  	

  13,780,671.71


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Chem Italia S.P.A.


  	

   


  	

  07/11/03


  	

   


  	

  01/12/03


  	

   


  	

  3.579


  	

   


  	

  15,500,000.00


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  15,500,000.00


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Iberia


  	

   


  	

  21/11/03


  	

   


  	

  19/12/03


  	

   


  	

  1.94


  	

   


  	

  10,034,730.51


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  10,034,730.51


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Engineering Plastics

  NV


  	

   


  	

  04/11/03


  	

   


  	

  04/12/03


  	

   


  	

  1.969


  	

   


  	

  17,637,894.77


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  17,637,894.77


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Acetow AG


  	

   


  	

  16/10/03


  	

   


  	

  16/01/04


  	

   


  	

  2.963


  	

   


  	

  5,000,000.00


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  5,000,000.00


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Acetow AG


  	

   


  	

  16/10/03


  	

   


  	

  16/01/04


  	

   


  	

  2.963


  	

   


  	

  5,000,000.00


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  5,000,000.00


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Chem Italia S.P.A.


  	

   


  	

  03/11/03


  	

   


  	

  01/12/03


  	

   


  	

  3.044


  	

   


  	

  40,000,000.00


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  40,000,000.00


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Chimie


  	

   


  	

  09/10/03


  	

   


  	

  07/10/04


  	

   


  	

  2


  	

   


  	

  185,000,000.00


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  185,000,000.00


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Finance


  	

   


  	

  01/08/03


  	

   


  	

  29/12/03


  	

   


  	

  1.818


  	

   


  	

  66,581,152.76


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  66,581,152.76


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Hpcii Espagne


  	

   


  	

  27/11/03


  	

   


  	

  29/12/03


  	

   


  	

  1.968


  	

   


  	

  2,742,946.03


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  2,742,946.03


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Deutschland GmbH


  	

   


  	

  28/11/03


  	

   


  	

  01/12/03


  	

   


  	

  1.968


  	

   


  	

  3,000,000.00


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  3,000,000.00


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Energy SAS


  	

   


  	

  28/11/03


  	

   


  	

  05/12/03


  	

   


  	

  3.393


  	

   


  	

  8,801.36


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  8,801.36


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Deutschland GmbH


  	

   


  	

  28/11/03


  	

   


  	

  01/12/03


  	

   


  	

  1.968


  	

   


  	

  1,800,000.00


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  1,800,000.00


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Siliconas Espana SA


  	

   


  	

  27/11/03


  	

   


  	

  29/12/03


  	

   


  	

  1.943


  	

   


  	

  2,172,626.25


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  2,172,626.25


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Iberlatex Espana


  	

   


  	

  27/11/03


  	

   


  	

  29/12/03


  	

   


  	

  1.943


  	

   


  	

  2,177,134.78


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  2,177,134.78


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Iberlatex Espana


  	

   


  	

  28/11/03


  	

   


  	

  29/12/03


  	

   


  	

  1.943


  	

   


  	

  4,390,455.29


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  4,390,455.29


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Iberia


  	

   


  	

  27/11/03


  	

   


  	

  10/12/03


  	

   


  	

  1.943


  	

   


  	

  8,000,000.00


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  8,000,000.00


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Intl Holdings BV


  	

   


  	

  28/11/03


  	

   


  	

  15/01/04


  	

   


  	

  1.9805


  	

   


  	

  21,034,469.41


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  21,034,469.41


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Siliconas Espana SA


  	

   


  	

  28/11/03


  	

   


  	

  29/12/03


  	

   


  	

  1.943


  	

   


  	

  4,401,007.82


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  4,401,007.82


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Deutschland GmbH


  	

   


  	

  27/11/03


  	

   


  	

  04/12/03


  	

   


  	

  1.988


  	

   


  	

  18,000,000.00


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  18,000,000.00


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Chimie


  	

   


  	

  02/09/03


  	

   


  	

  02/12/03


  	

   


  	

  2.026


  	

   


  	

  91,170,904.99


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  91,170,904.99


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Limited


  	

   


  	

  21/11/03


  	

   


  	

  19/12/03


  	

   


  	

  4.72031


  	

   


  	

  17,185,145.28


  	

   


  	

  GBP


  	

   


  	

  /0.69710


  	

   


  	

  24,652,338.66


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Limited


  	

   


  	

  26/11/03


  	

   


  	

  19/12/03


  	

   


  	

  4.71781


  	

   


  	

  195,087.29


  	

   


  	

  GBP


  	

   


  	

  /0.69710


  	

   


  	

  279,855.53


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Reorganisation Ltd


  	

   


  	

  28/11/03


  	

   


  	

  31/12/03


  	

   


  	

  4.7025


  	

   


  	

  223,026,510.90


  	

   


  	

  GBP


  	

   


  	

  /0.69710


  	

   


  	

  319,934,745.23


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Limited


  	

   


  	

  28/11/03


  	

   


  	

  01/12/03


  	

   


  	

  3.43719


  	

   


  	

  1,042,050.00


  	

   


  	

  GBP


  	

   


  	

  /0.69710


  	

   


  	

  1,494,835.75


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Limited


  	

   


  	

  28/11/03


  	

   


  	

  19/12/03


  	

   


  	

  4.68


  	

   


  	

  4,477,089.82


  	

   


  	

  GBP


  	

   


  	

  /0.69710


  	

   


  	

  6,422,449.89


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Limited


  	

   


  	

  28/11/03


  	

   


  	

  19/12/03


  	

   


  	

  4.68


  	

   


  	

  1,848,000.00


  	

   


  	

  GBP


  	

   


  	

  /0.69710


  	

   


  	

  2,650,982.64


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia ind. Yarns

  Daugavpils


  	

   


  	

  24/10/03


  	

   


  	

  03/12/03


  	

   


  	

  2.725


  	

   


  	

  2,510,547.87


  	

   


  	

  LVL


  	

   


  	

  /0.65550


  	

   


  	

  3,829,973.87


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Participations Chimiques

  c/o Sefige


  	

   


  	

  30/09/03


  	

   


  	

  29/12/03


  	

   


  	

  1.035


  	

   


  	

  481,569.65


  	

   


  	

  USD


  	

   


  	

  /1.19940


  	

   


  	

  401,508.80


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Performance Fibres

  GmbH


  	

   


  	

  28/11/03


  	

   


  	

  30/12/03


  	

   


  	

  0.99375


  	

   


  	

  138,766.10


  	

   


  	

  USD


  	

   


  	

  /1.19940


  	

   


  	

  115,696.26


  	

   


  
	

  Subsidiary Lender


  	

   


  	

  Fully consolidated


  	

   


  	

  Alaver


  	

   


  	

  25/06/03


  	

   


  	

  22/12/03


  	

   


  	

  1.49


  	

   


  	

  8,076,904.30


  	

   


  	

  USD


  	

   


  	

  /1.19940


  	

   


  	

  6,734,120.64


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Canada Inc


  	

   


  	

  30/09/03


  	

   


  	

  03/12/03


  	

   


  	

  4.93833


  	

   


  	

  14,278,400.00


  	

   


  	

  CAD


  	

   


  	

  /1.55520


  	

   


  	

  9,181,069.96


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Canada Inc


  	

   


  	

  28/10/03


  	

   


  	

  03/12/03


  	

   


  	

  4.98667


  	

   


  	

  2,000,000.00


  	

   


  	

  CAD


  	

   


  	

  /1.55520


  	

   


  	

  1,286,008.23


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Industrial Yarns AG


  	

   


  	

  21/11/03


  	

   


  	

  15/12/03


  	

   


  	

  0.06333


  	

   


  	

  2,000,000.00


  	

   


  	

  CHF


  	

   


  	

  /1.54840


  	

   


  	

  1,291,655.90


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Gesmo


  	

   


  	

  18/09/03


  	

   


  	

  18/12/03


  	

   


  	

  3


  	

   


  	

  5,362,224.53


  	

   


  	

  CHF


  	

   


  	

  /1.54840


  	

   


  	

  3,463,074.48


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Equity method


  	

   


  	

  Nylstar SAS


  	

   


  	

  30/09/03


  	

   


  	

  03/12/03


  	

   


  	

  3.153


  	

   


  	

  -300,000.00


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  -300,000.00


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Energy SAS


  	

   


  	

  07/11/03


  	

   


  	

  05/12/03


  	

   


  	

  3.393


  	

   


  	

  4,531,190.42


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  4,531,190.42


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Nederland


  	

   


  	

  21/11/03


  	

   


  	

  19/12/03


  	

   


  	

  3.365


  	

   


  	

  506,826.31


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  506,826.31


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Non-consolidated


  	

   


  	

  Rhodia Consomer Spec. BV


  	

   


  	

  31/10/03


  	

   


  	

  30/01/04


  	

   


  	

  3.453


  	

   


  	

  584,066.84


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  584,066.84


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Particitions


  	

   


  	

  29/10/03


  	

   


  	

  30/04/04


  	

   


  	

  3.508


  	

   


  	

  62,252,844.16


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  62,252,844.16


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Equity method


  	

   


  	

  Nylstar NV


  	

   


  	

  28/11/03


  	

   


  	

  29/12/03


  	

   


  	

  3.093


  	

   


  	

  17,037,219.65


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  17,037,219.65


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Engineering Plastics

  NV


  	

   


  	

  07/11/03


  	

   


  	

  08/11/04


  	

   


  	

  8.5


  	

   


  	

  15,500,000.00


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  15,500,000.00


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Finance Intl


  	

   


  	

  28/11/03


  	

   


  	

  29/12/03


  	

   


  	

  2.993


  	

   


  	

  67,063,725.17


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  67,063,725.17


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Eco Services

  Nederland B.V


  	

   


  	

  21/11/03


  	

   


  	

  19/12/03


  	

   


  	

  3.365


  	

   


  	

  4,500,000.00


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  4,500,000.00


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Industrial Yarns

  Slovakia A.S.


  	

   


  	

  28/11/03


  	

   


  	

  31/12/03


  	

   


  	

  3.393


  	

   


  	

  3,788,920.00


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  3,788,920.00


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Equity method


  	

   


  	

  Nylstar SAS


  	

   


  	

  03/09/03


  	

   


  	

  03/12/03


  	

   


  	

  3.153


  	

   


  	

  2,800,000.00


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  2,800,000.00


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Germany

  International


  	

   


  	

  31/12/02


  	

   


  	

  05/07/04


  	

   


  	

  5.2


  	

   


  	

  753,350,235.35


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  753,350,235.35


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Germany

  International


  	

   


  	

  30/06/03


  	

   


  	

  01/06/11


  	

   


  	

  9.345


  	

   


  	

  65,820,102.42


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  65,820,102.42


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Deutschland GMBH


  	

   


  	

  30/09/03


  	

   


  	

  30/12/03


  	

   


  	

  9.345


  	

   


  	

  44,000,000.00


  	

   


  	

  EUR


  	

   


  	

  1


  	

   


  	

  44,000,000.00


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Limited


  	

   


  	

  27/11/03


  	

   


  	

  19/12/03


  	

   


  	

  4.72031


  	

   


  	

  1,500,000.00


  	

   


  	

  GBP


  	

   


  	

  /0.69710


  	

   


  	

  2,151,771.63


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Limited


  	

   


  	

  25/11/03


  	

   


  	

  19/12/03


  	

   


  	

  4.72031


  	

   


  	

  1,761,080.13


  	

   


  	

  GBP


  	

   


  	

  /0.69710


  	

   


  	

  2,526,294.84


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Holding Limited


  	

   


  	

  02/01/02


  	

   


  	

  04/01/10


  	

   


  	

  6.301


  	

   


  	

  58,724,352.50


  	

   


  	

  GBP


  	

   


  	

  /0.69710


  	

   


  	

  84,240,930.28


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Holding Limited


  	

   


  	

  02/01/02


  	

   


  	

  05/01/09


  	

   


  	

  6.295


  	

   


  	

  62,438,838.28


  	

   


  	

  GBP


  	

   


  	

  /0.69710


  	

   


  	

  89,569,413.69


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Chirex Holdings Ltd


  	

   


  	

  03/09/01


  	

   


  	

  03/01/07


  	

   


  	

  6.28


  	

   


  	

  18,784,593.91


  	

   


  	

  GBP


  	

   


  	

  /0.69710


  	

   


  	

  26,946,770.78


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Holding Limited


  	

   


  	

  03/09/01


  	

   


  	

  03/01/07


  	

   


  	

  6.28


  	

   


  	

  50,573,906.67


  	

   


  	

  GBP


  	

   


  	

  /0.69710


  	

   


  	

  72,548,998.24


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Holding Limited


  	

   


  	

  03/09/01


  	

   


  	

  03/01/08


  	

   


  	

  6.3


  	

   


  	

  47,528,828.10


  	

   


  	

  GBP


  	

   


  	

  /0.69710


  	

   


  	

  68,180,789.13


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Holding Limited


  	

   


  	

  03/09/01


  	

   


  	

  03/01/06


  	

   


  	

  6.25


  	

   


  	

  53,815,799.10


  	

   


  	

  GBP


  	

   


  	

  /0.69710


  	

   


  	

  77,199,539.66


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Chirex Holdings Ltd


  	

   


  	

  03/09/01


  	

   


  	

  03/01/06


  	

   


  	

  6.25


  	

   


  	

  19,988,725.38


  	

   


  	

  GBP


  	

   


  	

  /0.69710


  	

   


  	

  28,674,114.73


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Chirex Holdings Ltd


  	

   


  	

  03/09/01


  	

   


  	

  04/01/05


  	

   


  	

  5.63


  	

   


  	

  21,653,612.00


  	

   


  	

  GBP


  	

   


  	

  /0.69710


  	

   


  	

  31,062,418.59


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Japan Ltd


  	

   


  	

  10/11/03


  	

   


  	

  05/12/03


  	

   


  	

  1.36


  	

   


  	

  1,000,236,250


  	

   


  	

  JPY


  	

   


  	

  /131.24000


  	

   


  	

  7,621,428.30


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Japan Ltd


  	

   


  	

  06/11/03


  	

   


  	

  05/12/03


  	

   


  	

  1.36


  	

   


  	

  1,900,448,875


  	

   


  	

  JPY


  	

   


  	

  /131.24000


  	

   


  	

  14,480,713.77


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Fosfatados de Mexico


  	

   


  	

  17/10/03


  	

   


  	

  19/12/03


  	

   


  	

  1.64


  	

   


  	

  -4,100,000.00


  	

   


  	

  USD


  	

   


  	

  /1.19940


  	

   


  	

  -3,418,375.85


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Energy SAS


  	

   


  	

  14/11/03


  	

   


  	

  05/12/03


  	

   


  	

  2.41


  	

   


  	

  200,000.00


  	

   


  	

  USD


  	

   


  	

  /1.19940


  	

   


  	

  166,750.04


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Inc


  	

   


  	

  13/11/03


  	

   


  	

  04/12/03


  	

   


  	

  2.16


  	

   


  	

  5,002,000.00


  	

   


  	

  USD


  	

   


  	

  /1.19940


  	

   


  	

  4,170,418.54


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia China


  	

   


  	

  10/11/03


  	

   


  	

  20/05/04


  	

   


  	

  2.55


  	

   


  	

  1,100,000.00


  	

   


  	

  USD


  	

   


  	

  /1.19940


  	

   


  	

  917,125.23


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Mexicana SA


  	

   


  	

  08/10/03


  	

   


  	

  18/12/03


  	

   


  	

  1.64


  	

   


  	

  2,774,186.25


  	

   


  	

  USD


  	

   


  	

  /1.19940


  	

   


  	

  2,312,978.36


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia de Mexico


  	

   


  	

  30/09/03


  	

   


  	

  18/12/03


  	

   


  	

  1.66


  	

   


  	

  20,343,655.03


  	

   


  	

  USD


  	

   


  	

  /1.19940


  	

   


  	

  16,961,526.62


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Fosfatados de Mexico


  	

   


  	

  30/09/03


  	

   


  	

  18/12/03


  	

   


  	

  1.66


  	

   


  	

  68,309,434.00


  	

   


  	

  USD


  	

   


  	

  /1.19940


  	

   


  	

  56,953,004.84


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Especialidados


  	

   


  	

  30/09/03


  	

   


  	

  18/12/03


  	

   


  	

  1.66


  	

   


  	

  2,643,403.97


  	

   


  	

  USD


  	

   


  	

  /1.19940


  	

   


  	

  2,203,938.61


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Engineering Plastics

  Co, LTD


  	

   


  	

  28/11/03


  	

   


  	

  30/01/04


  	

   


  	

  2.6675


  	

   


  	

  1,003,051.92


  	

   


  	

  USD


  	

   


  	

  /1.19940


  	

   


  	

  836,294.75


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Engineering Plastics

  Co, LTD


  	

   


  	

  18/09/03


  	

   


  	

  18/12/03


  	

   


  	

  2.64


  	

   


  	

  2,011,192.38


  	

   


  	

  USD


  	

   


  	

  /1.19940


  	

   


  	

  1,676,832.07


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Non-consolidated


  	

   


  	

  Rhodia Uruguay


  	

   


  	

  04/09/03


  	

   


  	

  04/12/03


  	

   


  	

  2.44563


  	

   


  	

  763,906.79


  	

   


  	

  USD


  	

   


  	

  /1.19940


  	

   


  	

  636,907.45


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Deutschland GmbH


  	

   


  	

  20/06/03


  	

   


  	

  22/12/03


  	

   


  	

  2.33875


  	

   


  	

  13,038,289.69


  	

   


  	

  USD


  	

   


  	

  /1.19940


  	

   


  	

  10,870,676.75


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Fully consolidated


  	

   


  	

  Rhodia Fosfatados de Mexico


  	

   


  	

  19/09/03


  	

   


  	

  19/12/03


  	

   


  	

  1.64


  	

   


  	

  39,142,502.53


  	

   


  	

  USD


  	

   


  	

  /1.19940


  	

   


  	

  32,635,069.64


  	

   


  
	

  Subsidiary Borrower


  	

   


  	

  Non-consolidated


  	

   


  	

  Rhodia Argentina S.A.


  	

   


  	

  15/09/03


  	

   


  	

  15/12/03


  	

   


  	

  1.64


  	

   


  	

  1,258,586.19


  	

   


  	

  USD


  	

   


  	

  /1.19940


  	

   


  	

  1,049,346.50


  	

   


  





 





























 




PART 2




INTERCOMPANY LOANS/BORROWINGS BETWEEN THE RHODIA SUBSIDIARIES




(AS OF 30th NOVEMBER, 2003)




 




	

  Lending

  entity


  	

   


  	

  Borrowing entity


  	

   


  	

  Amount (KEUR)


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

  Rhodia Finances


  	

   


  	

  Rhodia Inc.


  	

   


  	

  175,088


  	

   


  
	

  Rhodia Inc.


  	

   


  	

  Rhodia Holding Inc.


  	

   


  	

  148,187


  	

   


  
	

  Rhodia Ltd


  	

   


  	

  Rhodia Chirex Holdings Ltd


  	

   


  	

  64,800


  	

   


  
	

  Rhodia Financial Services

  Inc.


  	

   


  	

  Rhodia Inc.


  	

   


  	

  38,528


  	

   


  
	

  Rhodia Inc.


  	

   


  	

  Rhodia Pharma Solutions

  Inc.


  	

   


  	

  27,887


  	

   


  
	

  Rhodia Japan


  	

   


  	

  Anan Kasei Co Ltd


  	

   


  	

  16,417


  	

   


  
	

  Rhodia Acetow GmbH


  	

   


  	

  Alexil


  	

   


  	

  13,685


  	

   


  
	

  Rhodia Benelux


  	

   


  	

  Rhodia Finance

  International BV


  	

   


  	

  13,059


  	

   


  
	

  Rhodia Deutschland GmbH


  	

   


  	

  Rhodia Acetow GmbH


  	

   


  	

  10,871


  	

   


  
	

  Rhodia Inc.


  	

   


  	

  Rhodia Electronics &

  Catalysis Inc.


  	

   


  	

  6,542


  	

   


  
	

  Rhodia Financial Services

  Inc.


  	

   


  	

  Rhodia Ltd


  	

   


  	

  5,402


  	

   


  
	

  Rhodia Financial Services

  Inc.


  	

   


  	

  Rhodia Engineering

  Plastics Corp—USA


  	

   


  	

  5,003


  	

   


  
	

  Rhodia Iberia SA


  	

   


  	

  Rhodia HPCII—Espagne


  	

   


  	

  4,000


  	

   


  
	

  Rhodia China Co Ltd


  	

   


  	

  Beijing RP Eastern

  Chemical Ltd


  	

   


  	

  3,212


  	

   


  
	

  Rhodia China Co Ltd


  	

   


  	

  Rhodia Wuxi Pharmaceutical

  Co Ltd


  	

   


  	

  2,992


  	

   


  
	

  Rhodia Trading Australia


  	

   


  	

  Rhodia Australia Pty


  	

   


  	

  2,662


  	

   


  
	

  Rhodia Silicones Shangai

  Co Ltd


  	

   


  	

  Rhodia China Co Ltd


  	

   


  	

  2,153


  	

   


  
	

  Rhodia China Co Ltd


  	

   


  	

  Rhodia Silica Qingdao


  	

   


  	

  2,034


  	

   


  
	

  Rhodia Polyamide

  Intermediates


  	

   


  	

  Rhodia Recherches


  	

   


  	

  1,878


  	

   


  
	

  Rhodia Ltd


  	

   


  	

  Rhodia Asia-Pacific


  	

   


  	

  1,842


  	

   


  
	

  Rhodia Silicones Australia

  Pty Ltd


  	

   


  	

  Rhodia Australia Pty


  	

   


  	

  1,618


  	

   


  
	

  Rhodia Organique


  	

   


  	

  Rhodia Recherches


  	

   


  	

  1,585


  	

   


  
	

  Rhodia Inc.


  	

   


  	

  Rhodia Engineering

  Plastics Corp—USA


  	

   


  	

  1,537


  	

   


  
	

  Rhodia Brésil


  	

   


  	

  Rhodia Poliamida Brasil


  	

   


  	

  1,511


  	

   


  
	

  Conuben SL


  	

   


  	

  Rhodia Iberia SA


  	

   


  	

  1,350


  	

   


  
	

  Rhodia Acetow Venezuela SA


  	

   


  	

  Rhodia Silices de

  Venezuela C.A.


  	

   


  	

  1,302


  	

   


  
	

  Rhodia Hengchang Spec Chem


  	

   


  	

  Rhodia China Co Ltd


  	

   


  	

  1,169


  	

   


  
	

  Rhodia China Co Ltd


  	

   


  	

  Ruohai Fine Chemicals Co

  Ltd


  	

   


  	

  1,158


  	

   


  
	

  Rhodia Poliamida Ltda


  	

   


  	

  Rhodia Brésil


  	

   


  	

  1,090


  	

   


  
	

  Rhodia Silicones


  	

   


  	

  Rhodia Recherches


  	

   


  	

  1,039


  	

   


  
	

  A&W Thai Holding


  	

   


  	

  Rhodia Thai Industries Ltd


  	

   


  	

  1,003


  	

   


  
	

  Rhodia Food SAS


  	

   


  	

  Rhodia Recherches


  	

   


  	

  933


  	

   


  
	

  Rhodia Iberia SA


  	

   


  	

  Rhodia Iberlatex


  	

   


  	

  800


  	

   


  
	

  Rhodia Silicones


  	

   


  	

  GIE Osiris


  	

   


  	

  758


  	

   


  
	

  Rhodia Nicca


  	

   


  	

  Rhodia Japan


  	

   


  	

  621


  	

   


  
	

  Rhodia Brésil


  	

   


  	

  Alexil


  	

   


  	

  469


  	

   


  
	

  Rhodia PPMC SAS


  	

   


  	

  Rhodia Recherches


  	

   


  	

  468


  	

   


  
	

  Rhodia China Co Ltd


  	

   


  	

  Rhodia Specialty Chemicals

  Wuxi


  	

   


  	

  403


  	

   


  
	

  Rhodia Cons Spec Malaysia


  	

   


  	

  Rhodia Malaysia SDN BHD


  	

   


  	

  373


  	

   


  
	

  Rhodia China Co Ltd


  	

   


  	

  Baotou Rhodia Rare Earths

  Co., Ltd


  	

   


  	

  302


  	

   


  
	

  Rhoia Intern. Trading Co

  Ltd


  	

   


  	

  Rhodia China Co Ltd


  	

   


  	

  235


  	

   


  
	

  Rhodia Organique


  	

   


  	

  Rhodia Food SAS


  	

   


  	

  186


  	

   


  
	

  Rhodia HPCII


  	

   


  	

  Rhodia Recherches


  	

   


  	

  181


  	

   


  
	

  A&W Asia Pacific

  Holding


  	

   


  	

  Rhodia Asia Pacific Pte

  Ltd


  	

   


  	

  169


  	

   


  
	

  Rhodia Poliamida Ltda


  	

   


  	

  Rhodia Poliamida Brasil


  	

   


  	

  166


  	

   


  
	

  Rhodia Electronics &

  Catalysis


  	

   


  	

  Rhodia Recherches


  	

   


  	

  158


  	

   


  
	

  Rhodia Eco Services


  	

   


  	

  Rhodia Recherches


  	

   


  	

  100


  	

   


  
	

  Rhodia P.I. Belle Etoile


  	

   


  	

  Rhodia Recherches


  	

   


  	

  8


  	

   


  





 





























 




SCHEDULE 8




ERISA EVENTS




 




For the purpose of this Agreement, an ERISA Event means:




 




	

  (a)


  	

   


  	

  (i)


  	

   


  	

  the occurrence of a

  reportable event, within the meaning of Section 4043 of ERISA, with respect

  to any Plan unless the 30-day notice requirement with respect to such event

  has been waived by the PBGC or


  
	

   


  	

   


  	

  (ii)


  	

   


  	

  the requirements of

  Section 4043(b) of ERISA apply with respect to a contributing sponsor, as

  defined in Section 4001(a)(13) of ERISA, of a Plan, and an event described in

  paragraph (9), (10), (11), (12) or (13) of Section 4043(c) of ERISA is

  reasonably expected to occur with respect to such Plan within the following

  30 days;


  
	

  (b)


  	

   


  	

  the application pursuant

  to Section 412(d) of the Code or Section 303 of ERISA for a minimum funding

  waiver with respect to a Plan;


  
	

  (c)


  	

   


  	

  the provision by the

  administrator of any Plan of a notice of intent to terminate such Plan,

  pursuant to Section 4041(a)(2) of ERISA (including any such notice with

  respect to a plan amendment referred to in Section 4041(e) of ERISA);


  
	

  (d)


  	

   


  	

  the cessation of

  operations at a facility of any Obligor or any ERISA Affiliate in the

  circumstances described in Section 4062(e) of ERISA;


  
	

  (e)


  	

   


  	

  the withdrawal by any

  Obligor or any ERISA Affiliate from a Multiple Employer Plan during a plan

  year for which it was a substantial employer, as defined in Section

  4001(a)(2) of ERISA;


  
	

  (f)


  	

   


  	

  the imposition of a lien

  under Section 302(f) of ERISA with respect to any Plan;


  
	

  (g)


  	

   


  	

  the adoption of an

  amendment to a Plan requiring the provision of security to such Plan pursuant

  to Section 307 of ERISA; or


  
	

  (h)


  	

   


  	

  the institution by the

  PBGC of proceedings to terminate a Plan pursuant to Section 4042 of ERISA, or

  the occurrence of any event or condition described in Section 4042 of ERISA

  that constitutes grounds for the termination of, or the appointment of a

  trustee to administer, such Plan, provided, however, that the occurrence of

  the event or condition described in Section 4042(a)(4) of ERISA shall be an

  ERISA Event only if the PBGC has notified any Obligor or ERISA Affiliate that

  it intends to institute proceedings to terminate a Plan pursuant to such

  subsection.


  





 




 




SCHEDULE 9




AGREED LEASE AMENDMENT PRINCIPLES




 




Leases will be renegotiated and amended on a

bilateral basis within the framework of the arrangements under this Agreement

in accordance with the Term Sheets to be provided to the Intercreditor Agent on

or prior to the Commencement Date to include:




 




1.                                      Reduction:




 




(a)                                  5% at the time the consent and waiver letter

is supplied to the Intercreditor Agent on or prior to the Commencement Date;




 




(b)                                 5% on the Term Date;




 




(c)                                  Lease Term unchanged or shortened to be

co-terminus with the Refinancing Facilities Agreement.




 




2.                                      Security:




 




(a)                                  Guarantee of Rhodia S.A. on 100% of total

lease obligation (same as the one existing today);




 




(b)                                 to share in security offered to Finance

Parties under the Shared Security Documents in respect of 80% of obligations of

Rhodia S.A. under its guarantee, subject to and in accordance with the Agreed

Security Sharing Principles.




 




3.                                      Fees:




 




70bp payable at the signing

of the lease amendment or consent and waiver letter referred to above.




 




4.                                      Margin:




 




305bp on the debt component

of the lease up to March 2006.




 




5.                                      Covenants:




 




To be amended or

supplemented in line with agreed covenants under this Agreement and thereafter

the Refinancing Facilities Agreement.




 





























 




SCHEDULE 10




FORM OF COMPLIANCE CERTIFICATE




 




[To be reviewed, completed by Chief

Financial Officer/Auditors and to include details of definitions and

computations of financial covenants]




 




To: [AGENT]




 




From: [to be completed]




 




[DATE]




 




Dear Sirs




 




RHODIA

S.A.—Secured Co-ordination Agreement (the Secured Co-ordination Agreement)




 




I refer to the Secured Co-ordination

Agreement and in particular to Clause 10.1 (Financial covenant definitions),

Clause 10.2 (Ratio of Consolidated Net Indebtedness to Adjusted EBITDAR) and

Clause 10.3 (Ratio of EBITDAR to Net Financial Expenses) thereof.




 




Terms defined in the Secured Co-ordination

Agreement shall have the same meaning when used in this certificate.




 




I certify as follows:




 




1.                                       For the Ratio Period ending on [  •  ]:




 




(a)                                  the Borrower’s EBITDAR was

[          ];




 




(b)                                 the Borrower’s Adjusted EBITDAR was [            ];




 




(c)                                  the Borrower’s Consolidated Net Indebtedness

was [            ]; and




 




(d)                                 the Borrower’s Net Financial Expenses were

[            ].




 




Accordingly for the Ratio

Period referred to above:




 




(i)                                     the ratio of the Borrower’s EBITDAR to its

Net Financial Expenses was: [           

]; and




 




(ii)                                  the ratio of the Borrower’s Consolidated Net

Indebtedness to Adjusted EBITDAR was: [            ].




 




2.                                       The following table sets out the information

in relation to Relevant Entities used in the calculation of Adjusted EBITDAR

referred to at paragraph 1(b):




 




 




	

  Relevant Entity and place of


  incorporation/establishment


  	

   


  	

  Relevant

  Entity


  EBITDAR


  	

   


  	

  Borrower’s

  participation in the capital of the


  Relevant Entity


  	

   


  	

  Amount of

  adjustment to


  Borrower’s EBITDAR


  for Relevant Entity


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  





 




3.                                       The following components were used in the

calculation of the Borrower’s Consolidated Net Indebtedness:




 




(a)                                  Gross debt = [            ];




 




(b)                                 Cash position = [            ];




 




(c)                                  Sale of receivables = [            ];




 




(d)                                 Securitisation outstanding = [            ]; and




 




(e)                                  Leasing = [            ].




 




4.                                       The following components were used in the

calculation of the Borrower’s Net Financial Expenses:




 




(a)                                  Interest Expense including interest portion

of lease rentals = [            ]; and




 




(b)                                 Interest income = [            ].




 




 




Chief Financial Officer/Auditors




 





























 




SCHEDULE 11




AGREED SECURITY PRINCIPLES




 




PART 1




GENERAL




 




	

  Value:


  	

   


  	

  Based on a value-to-loan

  ratio of 2.5x (LTV Test);


  
	

  Secured

  Assets:


  	

   


  	

  Assets listed in Part 2 of

  this Schedule AND any additional assets of the Group required to obtain a

  Valuation Report confirming compliance with the LTV Test on the Security

  Testing Date;


  
	

  Valuation

  report:


  	

   


  	

  Report provided by a third

  party reputable international Corporate Finance Advisory firm appointed by

  Rhodia confirming the value of the Secured Assets (listed in Part 2 and any

  additional assets) on a going concern basis, on terms satisfactory to the

  Majority Secured Creditors;


  
	

  Security

  Testing Date:


  	

   


  	

  Date on which the Shared

  Security provided for in the SCA is Effective;


  
	

  Effective:


  	

   


  	

  Security package effective

  as per SCA;


  
	

  Beneficiaries:


  	

   


  	

  See Part 3 of this

  Schedule;


  
	

  Amount of

  Exposure secured:


  	

   


  	

  €1.2bn;


  
	

  Security

  Sharing:


  	

   


  	

  Beneficiaries

  of Security shall be party to a Security Sharing Agreement which shall

  legislate for limitations on and a procedure for Enforcement Action and a

  procedure for sharing of security between different creditor groups as set

  out tin Part 4.


  





 




 




 





























 




PART 2




 




SECURED

ASSETS




 




	

  GRANTOR OF

  SECURITY


  	

   


  	

  COMPANY/COMPANIES


  SECURED


  	

   


  	

  PROPOSED

  SECURITY


  	

   


  	

  VALUE


  SHARES


  (? M)(1)(2)


  	

   


  	

  VALUE


  INTERCO LOAN


  (? M)(1)


  	

   


  	

  TOTAL BOOK


  VALUE


  (? M)(1)


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

  Security granted by:


  •        Rhodia S.A. by way of a

  share pledge over shares of certain of its subsidiaries listed below as

  security for its obligations under the Finance Documents and Facility

  Agreements as principal or surety; and


  •        an intercompany borrower

  under an intercompany loan owed to the Company (referred to in the table

  below) over certain of its subsidiaries listed below as security for its

  obligations under the intercompany loan.


  	

   


  	

  Security granted by the

  Company by way of an assignment of intercompany loans owed to it as security

  for its obligations as principal debtor and, to the extent permitted by the

  governing law of the security, guarantor. 

  A cession by ILi Daily cannot secure the obligations of the Company as

  guarantor.


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

  Rhodia

  S.A. and Rhodia International GmbH


  	

   


  	

  Rhodia

  Acetow GmbH




  100% subsidiary of Rhodia

  S.A. owned indirectly through Rhodia Germany International GmbH and Sopargest

  S.A.


  	

   


  	

  •        Share pledge by Rhodia

  Germany International GmbH (RGI) of 85% of shares of Rhodia Acetow GmbH;


  	

   


  	

  Intercompany Loan in an

  amount no less than ?400 million made to the pledgor by Rhodia S.A.


  	

   


  	

  484


  	

   


  	

  0


  	

   


  	

  558


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

  •        Share pledge by Rhodia S.A.

  of 100% of shares of Sopargest S.A. which owns, among others, remaining 15%

  of shares of Rhodia Acetow GmbH.


  	

   


  	

   


  	

   


  	

  74


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

  Status: Operating company


  	

   


  	

  The share pledge granted by

  RGI is to be granted (A) by way of security for an intercompany loan in an

  amount not less than ?400m made by Rhodia S.A. to RGI or (B) by RGI

  directly by way of a limited recourse pledge, in each case to the fullest

  extent permitted by law.  To the

  extent not permitted alternative security of equivalent value will be

  substituted.


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

  Rhodia

  S.A.


  	

   


  	

  Rhodia

  Brazil Ltda




  100% direct subsidiary of

  Rhodia S.A.




  Status: Operating company


  	

   


  	

  •        Share pledge by Rhodia S.A.

  of 100% of shares of Rhodia Brazil Ltda (RBL)


  	

   


  	

  Intercompany loan by Rhodia

  S.A. to RBL of Japanese Yen 5,500,000,000 (?43,000,000) due 11/04.


  	

   


  	

  201


  	

   


  	

  43


  	

   


  	

  244


  	

   


  





 






















(1)  Book value as of September 30, 2003




(2)  Does not take into account any goodwill amortization or other

assets depreciation or amortization that may take place at a later date




 




112





























 




	

  GRANTOR OF

  SECURITY


  	

   


  	

  COMPANY/COMPANIES


  SECURED


  	

   


  	

  PROPOSED

  SECURITY


  	

   


  	

  VALUE


  SHARES


  (? M)(1)(2)


  	

   


  	

  VALUE


  INTERCO LOAN


  (? M)(1)


  	

   


  	

  TOTAL BOOK


  VALUE


  (? M)(1)


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

  Security granted by:


   


  •        Rhodia S.A. by way of a

  share pledge over shares of certain of its subsidiaries listed below as

  security for its obligations under the Finance Documents and Facility

  Agreements as principal or surety; and


   


  •        an intercompany borrower

  under an intercompany loan owed to the Company (referred to in the table

  below) over certain of its subsidiaries listed below as security for its

  obligations under the intercompany loan.


  	

   


  	

  Security granted by the

  Company by way of an assignment of intercompany loans owed to it as security

  for its obligations as principal debtor and, to the extent permitted by the

  governing law of the security, guarantor. 

  A cession by ILi Dailly cannot secure the obligations of the Company

  as guarantor.


   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

  Rhodia

  S.A. and Rhodia Participations SNC


  	

   


  	

  Rhodia

  Participations SNC


  	

   


  	

  [Share pledges granted by

  Rhodia S.A. over


  •        100% of shares of Rhodia

  Participations SNC;


   


  •        25% of shares of Rhodia

  Nederland](3)


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

  100% direct subsidiary of

  Rhodia SA


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

  Status: Holding company for

  Rhodia S.A.’s main French subsidiaries


  	

   


  	

  •        The ?654,000,000

  intercompany loan mentioned in the next column will be secured by share

  pledges by Rhodia Participation SNC of:


  	

   


  	

  Intercompany loan by Rhodia

  S.A. to Rhodia Participations:


  •    ?654,000,000 presently part

  of cash pooling loans will be converted into a medium term loan


  	

   


  	

   


  	

   


  	

  


  


  654


  	

   


  	

  


  


  654


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

  Rhodia

  Silicones S.A.S.


  	

   


  	

  •        Rhodia Silicones S.A.S.


  	

   


  	

   


  	

   


  	

  117


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

  Rhodia Silices

  S.A.S.


  	

   


  	

  •        Rhodia Silices S.A.S.


  	

   


  	

   


  	

   


  	

  37


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

  Rhodia

  Food S.A.S.


  	

   


  	

  •        Rhodia Food S.A.S.


  	

   


  	

   


  	

   


  	

  44


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

  Rhodia

  HPCII


  	

   


  	

  •        Rhodia HPCII


  	

   


  	

   


  	

   


  	

  21


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

  Rhodia

  Organique


  	

   


  	

  •        Rhodia Organique


  	

   


  	

   


  	

   


  	

  88


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

  Rhodia

  PPMC


  	

   


  	

  •        Rhodia PPMC


  	

   


  	

   


  	

   


  	

  46


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

  Rhodia

  Ecoservices


  	

   


  	

  •        Rhodia Ecoservices


  	

   


  	

   


  	

   


  	

  43


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

  Rhodia

  Electronics & Catalysis


  	

   


  	

  •        Rhodia Electronics &

  Catalysis


  	

   


  	

   


  	

   


  	

  42


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

  Rhodia

  Intermediates


  	

   


  	

  •        Rhodia Intermedites


  	

   


  	

   


  	

   


  	

  38


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

  Rhodia

  Meyhall


  	

   


  	

  •        Rhodia Meyhall


  	

   


  	

   


  	

   


  	

  22


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

  Rhodia

  Nederland


  	

   


  	

  •        75% of Rhodia Nederland


  	

   


  	

   


  	

   


  	

  39


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

  Rhodia

  Hengchang Zhangjiagang


  	

   


  	

  •        Rhodia Hengchang

  Zhangjiagang


  	

   


  	

   


  	

   


  	

  9


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

  Rhodia

  Italia


  	

   


  	

  •        Rhodia Italia


  	

   


  	

   


  	

   


  	

  18


  	

   


  	

   


  	

   


  	

   


  	

   


  





 






















(3)                                  Assets

to be granted as security in case expert valuation does not meet LTV Test of

2.5x in respect of the other Secured Assets on a going concern basis.




 




113





























 




 




	

  GRANTOR OF

  SECURITY


  	

   


  	

  COMPANY/COMPANIES


  SECURED


  	

   


  	

  PROPOSED

  SECURITY


  	

   


  	

  VALUE


  SHARES


  (? M)(1)(2)


  	

   


  	

  VALUE


  INTERCO LOAN


  (? M)(1)


  	

   


  	

  TOTAL BOOK


  VALUE


  (? M)(1)


  
	

   


  	

   


  	

   


  	

   


  	

  Security granted by: 


   


  •    Rhodia S.A. by way of a share pledge over

  shares of certain of its subsidiaries listed below as security for its

  obligations under the Finance Documents and Facility Agreements as principal

  or surety; and 


   


  •    an intercompany borrower under an

  intercompany loan owed to the Company (referred to in the table below) over

  certain of its subsidiaries listed below as security for its obligations

  under the intercompany loan.


  	

   


  	

  Security granted by the

  Company by way of an assignment of intercompany loans owed to it as security

  for its obligations as principal debtor and, to the extent permitted by the

  governing law of the security, guarantor. 

  A cession by ILi Dailly cannot secure the obligations of the Company

  as guarantor.


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

  Rhodia

  S.A.


  	

   


  	

  Rhodia

  Participations SNC Subsidiaries 


   


  Status: Operating companies


   


  Rhodia

  Silicones


  SASRhodia

  Silices


  SASRhodia

  Food SAS


   


  Rhodia

  HPCII


   


  Rhodia

  Organique


  	

   


  	

   


  	

   


  	

  Intercompany loans by

  Rhodia S.A. to each of the companies listed below which are presently part of

  cash pooling will be converted into medium term loans to be secured for:


   


  •    Rhodia Silicones SAS of €76,000,000




  •    Rhodia Silices SAS of €32,000,000




  •    Rhodia Food SAS of €39,000,000




  •    Rhodia HPCII of €29,000,000




  •    Rhodia Organique of €126,000,000


  	

   


  	

  


  


  


  


  


  


  


  


  


  


  


  


  


  0


  	

   


  	

  


  


  


  


  


  


  


  


  


  


  


  


  


  302


  	

   


  	

  


  


  


  


  


  


  


  


  


  


  


  


  


  302


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

  Rhodia

  S.A.


  	

   


  	

  Rhodianyl

  SNC


  	

   


  	

  •    [Share pledge of 100% of Rhodianyl](4)


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

  100% direct subsidiary of

  Rhodia SA


   


   


  	

   


  	

  •    The ?360,000,000 intercompany loan

  mentioned in the next column will be secured by:


  	

   


  	

  Intercompany loans by

  Rhodia S.A. to Rhodianyl which are presently part of cash pooling to be

  converted into medium term loans in an amount of ? 360,000,000.


  	

   


  	

   


  	

   


  	

  360


  	

   


  	

  360


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

  •    share pledge of 100% of Rhodia Eng.

  Plastics,


  	

   


  	

   


  	

   


  	

  32


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

  Status: Holding company for

  Rhodia S.A.’s Polyamide activities


  	

   


  	

  •    share pledge of 100% of Rhodia PI Chalampe

  (Rhodianyl SNC owns only 87%)


  	

   


  	

   


  	

   


  	

  93


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

  •    share pledge of 100% of Rhodia Polyamide

  Intermediares


  	

   


  	

   


  	

   


  	

  35


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

  •    share pledge of 100% of Rhodia Poliamida Especialidades

  (Rhodianyl owns only 50% of Rhodia Poliamida Especialidades Ltda)


  	

   


  	

   


  	

   


  	

  194


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

  •    To be released if Short Term Facility is

  not drawn in whole or in part or is cancelled in full by end of its

  availability period.


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  





 






















(4)                                  Assets

to be granted as security in case expert valuation does not meet LTV Test of

2.5x in respect of the other Secured Assets on a going concern basis.




 




114





























 




 




	

  GRANTOR OF

  SECURITY


  	

   


  	

  COMPANY/COMPANIES


  SECURED


  	

   


  	

  PROPOSED SECURITY


  	

   


  	

  VALUE


  SHARES


  (? M)(1)(2)


  	

   


  	

  VALUE


  INTERCO LOAN


  (? M)(1)


  	

   


  	

  TOTAL BOOK


  VALUE


  (? M)(1)


  
	

   


  	

   


  	

   


  	

   


  	

  Security granted by:




  •    Rhodia S.A. by way of a share pledge over

  shares of certain of its subsidiaries listed below as security for its obligations

  under the Finance Documents and Facility Agreements as principal or surety;

  and


   


  •    an intercompany borrower under an

  intercompany loan owed to the Company (referred to in the table below) over

  certain of its subsidiaries listed below as security for its obligations

  under the intercompany loan.


  	

   


  	

  Security granted by the

  Company by way of an assignment of intercompany loans owed to it as security

  for its obligations as principal debtor and, to the extent permitted by the

  governing law of the security, guarantor. 

  A cession by ILi Dailly cannot secure the obligations of the Company

  as guarantor.


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

  Rhodia

  S.A. and Rhodia Holdings Ltd.


  	

   


  	

  Rhodia

  Holdings Ltd.


  	

   


  	

  •    Share pledge by Rhodia S.A. of 100% of

  Rhodia Holdings Ltd.


  	

   


  	

  Intercompany loans by

  Rhodia S.A. to Rhodia Holdings Ltd as set out below:


  	

   


  	

  817


  	

   


  	

  391


  	

   


  	

  1,208


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

  100% direct subsidiary of

  Rhodia S.A.


  	

   


  	

  •    The ?390,847,013 (GBP 273,045,723)

  intercompany loans mentioned in the next column to be secured by share

  pledges granted by Rhodia Holding Ltd. over:


  	

   


  	

  •    GBP 58,724,352 due on 04/01/10


   


  •    GBP 62,438,838 due on 05/01/09


   


  •    GBP 47,528,828 due on 03/01/08


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

  Status: Holding company


  	

   


  	

  •    Rhodia Overseas Ltd.


  	

   


  	

  •    GBP 53,815,799 due on 03/01/06


  	

   


  	

  1


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

  •    Rhodia Ltd.


  	

   


  	

  •    GBP 50,537,906 due on 03/01/07.


  	

   


  	

  354


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

  •    Rhodia HPC ?? UK Ltd.


  	

   


  	

   


  	

   


  	

  8


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

  •    Rhodia Food UK Ltd.


  	

   


  	

   


  	

   


  	

  4


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

  •    Rhodia Ecoservices Ltd.


  	

   


  	

   


  	

   


  	

  26


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

  •    Rhodia Pharma Solutions (Holdings) Ltd.


  	

   


  	

   


  	

   


  	

  66


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

  •    Rhodia Consumer Specialities Ltd.


  	

   


  	

   


  	

   


  	

  1


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

  •    Rhodia Industrial Specialities Ltd.


  	

   


  	

   


  	

   


  	

  28


  	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

  Total


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

  3,326


  





 




115





























 




PART 3




BENEFICIARIES




 




	

  Affected Facilities (as per


  Schedule 3 of the SCA)


  	

   


  	

  Pre-term

  date(5)


  Exposure secured by shared


  security


  	

   


  	

  Post-term

  date


  Secured by


  Exposure


  shared security


  	

   


  	

  Pre-term

  date


  Non-shared security


  	

   


  	

  Post-term

  date


  Non-shared security


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

  Committed Bank lines/Refinancing Facilities Agreement


  	

   


  	

  100% of Exposure as set

  out in Schedule 3 of SCA


  	

   


  	

  As under the Refinancing

  Facilities Agreement


  	

   


  	

  Existing Security, if any,

  as per Part 1 of Schedule 4 of SCA under relevant Facility Agreement


  	

   


  	

  Existing security, if any,

  as per Part 1 of Schedule 4 of SCA under relevant Facility Agreement where

  not refinanced under the Refinancing Facilities Agreement


  
	

  Uncommitted Facilities including Overdraft Facilities


  	

   


  	

  100% of Exposure as set

  out in Schedule 3 of SCA as reduced in accordance with the SCA


  	

   


  	

  100% of Exposure at Term

  Date, not to exceed 100% of Exposure as set out in Schedule 3 of SCA as

  reduced in accordance with the SCA


  	

   


  	

  Existing security, if any,

  as per Part 1 of Schedule 4 of SCA under relevant Facility Agreement


  	

   


  	

  Existing security, if any,

  as per Part 1 of Schedule 4 of SCA under relevant Facility Agreement


  
	

  Leases


  	

   


  	

  80% of Exposure as set out

  in Schedule 3 of SCA (to include equity/recourse obligations) [as reduced in

  accordance with the SCA]


  	

   


  	

  80% of Exposure as set out

  in Schedule 3 of SCA as reduced in accordance with the SCA(6) [and after

  taking into account permitted lease payments during SCA]


  	

   


  	

  Existing security as per

  Part 1 of Schedule 4 of SCA under relevant Facility Agreement and where

  applicable 5% Lessor Reduction in accordance with Agreed Lease Agreeement

  Principles


  	

   


  	

  Existing security as per

  Part 1 of SCA under relevant Facility Agreement and where applicable 5%

  Lessor Reduction on Term Date


  
	

  Letters of credit/banking guarantees


  	

   


  	

  30% of Exposure as set out

  in Schedule 3 of SCA and 100% of that Exposure in respect of a claim made by

  a Lender following a payment under that letter of credit or guarantee by that

  Lender (except in respect of a payment under an “extend or pay” letter of

  creditor or guarantee made at the time of its maturity


  	

   


  	

  30% of Exposure as set out

  in Schedule 3 of SCA except for letters of credit/banking guarantees (i)

  maturing post-Term Date to be negotiated on a bilateral basis upwards or

  downwards on or around the maturity date or (ii) counter-indemnified under

  the Refinancing Facilities Agreement


  	

   


  	

  Existing security as per

  Part 1 of Schedule 4 of SCA under relevant Facility Agreement


  	

   


  	

  Existing security as per

  Part 1 of Schedule 4 of SCA under relevant Facility Agreement and cash

  collateral and/or a counter-guarantee under the Refinancing Facilities

  Agreement up to a maximum aggregate amount to be agreed


  
	

  Derivative Instruments


  	

   


  	

  100% of its Derivative

  Liability up to the maximum Exposure under that Derivative Instrument as set

  out in Schedule 3 of SCA


  	

   


  	

  100% of its Derivative

  Liability up to the maximum Exposure under that Derivative Instrument as set

  out in Schedule 3 of the SCA


  	

   


  	

  Derivative Deposit as per

  the SCA up to a maximum aggregate amount for all Derivative Instruments not

  exceeding Euros 40,000,000


  	

   


  	

  Derivative Deposit as per

  the SCA up to a maximum aggregate amount for all Derivative Instruments not

  exceeding the amount secured at the Term Date


  





 




 




	

  Non-Affected Facilities (as


  per Schedule 3 of the SCA)


  	

   


  	

  Pre-term

  date(5)


  Exposure secured by shared


  security


  	

   


  	

  Post-term

  date


  Secured by


  Exposure


  shared security


  	

   


  	

  Pre-term

  date


  Non-shared security


  	

   


  	

  Post-term

  date


  Non-shared security


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

  High Yield Bonds


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  
	

  USPP


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

   


  
	

  EMTN


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  
	

  Credit facilities (committed and uncommitted bank lines and

  overdrafts)


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  
	

  Securitisations


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  
	

  Sales of receivables/forfeiting


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  
	

  Operating leases


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  
	

  Letters of credit/banking guarantees


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  
	

  Forfeiting programmes


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  





 






















(5)                                  Dilution percentage Secured Debt to Shared

Security approximately 91/98%.




 




(6)                                  Schedule 3 will be updated to reflect agreed

commercial terms and Exposure as reduced.




 





























 




PART 4




SECURITY

SHARING PRINCIPLES




 




1.                                       Parties to the Security

Sharing Agreement:  The Company, the Senior Secured Creditors

(and relevant Facility/Security Agents), the Security Agent and the

Intercreditor Agent. The USPP Noteholders shall not be parties to, but may have

the benefit of, the provisions of the Security Sharing Agreement.




 




2.                                       Senior Secured Creditors:  The

creditors listed in the attached Schedule pre/post Term Date (as defined in the

SCA) including beneficiaries of both the Shared Security and the Non-Shared

Security.




 




3.                                       Majority Secured Creditors: 

Senior Secured Creditors who together represent 66.67% of outstanding

Exposure of the Senior Secured Creditors (including after the Term Date (but

not before) the commitments/outstandings under the Refinancing Facilities

Agreement).




 




4.                                       Security Agent:  To

be agreed.




 




5.                                      Security:




 




•                                          Shared Security-The Secured Assets as listed in Part 2 of

Schedule 11 of the SCA (including for these purposes the new Company Guarantee)

and any other assets designated as Shared Security by the Company and the

Intercreditor Agent in accordance with the SCA.




 




•                                          Non-Shared Security-The security listed in the attached Schedule

pre/post Term Date (as defined in the SCA) being the Existing Security (as

defined in the SCA) and any existing guarantees (including any existing

guarantees from the Company but excluding the Rhodia Inc and the Rhodia Holding

Inc. guarantee of the USPP) and any security interests/guarantees permitted to

be created by the SCA in respect of each Facility (other than the Shared

Security) and including equipment/assets subject to a lease but excluding, for

the avoidance of doubt, receivables under securitisation programmes.




 




6.                                      Secured Debt:




 




•                                          The aggregate amount of Exposure under each

Facility which is to be secured by the Shared Security up to the maximum amount

per Facility set out in the attached Schedule pre/post Term Date.




 




•                                          The maximum aggregate amount of Secured Debt

has been determined having regard to security interests permitted under the

senior High Yield Bonds being Euros 1.3 billion minus (i) up to €40 million of

Derivative Deposit permitted by SCA and (ii) up to €60 million of additional

non-Shared Security permitted by SCA.




 




•                                          The maximum aggregate amount of the present

value of net rental payments under leases(7) which can be secured as Secured

Debt is € 150 million.




 




 






















(7)                                  Only including Cranbury, SG Synthetic Lease

and Leasing “Chase”.




 




•                                          The USPP will not be Secured Debt for the

purposes of the Security Sharing Agreement and Security Documents (see point 12

below for treatment of USPP).




 




•                                          It is intended that the Shared Security will

secure any Exposure which was secured on the Shared Security and which is

replaced, refinanced, refunded or renewed to the fullest extent legally

possible.




 




7.                                      Ranking of Secured Debt:




 




•                                          The Senior Secured Creditors (including the

Participants in the Rhodia Inc Synthetic Lease) will rank pari passu in right of priority and

payment in respect of the Secured Debt secured by the Shared Security.




 




•                                          The pari

passu ranking of the Secured Debt secured by the Shared Security

will apply regardless of any matter or thing whatsoever which might otherwise

impact that ranking including, for example, the order of registration, notice or

execution of any document any fluctuation in the outstanding amount of, or any

intermediate discharge of, any Secured Debt.




 




8.                                      Consents:  The

Senior Secured Creditors will:




 




•                                          consent to the granting of the Shared

Security both pre-Term Date and post-Term Date;




 




•                                          co-operate (but not take or refrain from

taking action otherwise prejudicial to it) so that the Secured Debt continues

to be secured on the Shared Security until the Senior Discharge Date; and




 




•                                          consent to the granting of new security

permitted to be granted by the SCA and intended to benefit the lenders under

the Refinancing Facilities Agreement.




 




9.                                      Security Discharge

Date/Release:




 




•                                          The Security Sharing Agreement will apply

from the date of signature through to the Security Discharge Date as regards

the Security except that it will cease to apply to Non-Shared Security after

the Term Date (unless a default under the SCA is outstanding at such date) or

if all obligations in respect of the USPP have not been unconditionally paid or

discharged in full.




 




•                                          Security Discharge Date means the date on

which the Intercreditor Agent notifies the Company (acting on the instructions

of the Secured Creditors) in writing that all Secured Debt has been

unconditionally paid or discharged in full and that the total commitments under

the secured Facilities have been cancelled in full. Notwithstanding the

foregoing and with exceptions to be agreed, the Security shall not be released

except to the extent that all obligations in respect of the USPP have been unconditionally

paid or discharged in full.




 




•                                          The Security Sharing Agreement will provide a

release mechanism (to be agreed) for Shared Security assets on and to the

extent of a disposal permitted under and in accordance with the SCA pre-Term

date and/or the Refinancing Facilities Agreement post-Term Date and/or for the

purpose of the paragraph above.




 




•                                          For the purposes of the Shared Security, the

release date means the date on which the Security Agent notifies the Company

(acting on the instructions of the Secured Creditors) in writing that the long

term credit rating for the Company quoted by both Moody’s and S&P has

reached investment grade and provided that other security for all other

facilities (other than Non-Shared Security and existing guarantees) has been or

is simultaneously released.




 





























 




10.                               Enforcement of Shared

Security:




 




•                                          Until the Security Discharge Date, the

Security Agent and /or the Majority Secured Creditors shall have the exclusive

right to enforce the Shared Security and to give instructions to the Security

Agent to do the same, irrespective of whether any event of default or declared

default has occurred under any Facility.




 




•                                          The USPP Noteholders shall have no voting

rights under the Security Sharing Agreement nor any right to direct the

Security Agent or any Senior Secured Creditor in respect of any action relating

to the Shared Security and/or the Non-Shared Security.




 




11.                               Enforcement of Non-Shared

Security:




 




•                                          Until the Term Date (but not thereafter

unless a Default is outstanding under the SCA) no Senior Secured Creditor shall

enforce any Non-Shared Security or generally take any Enforcement Action (as

defined in the SCA) (other than as permitted by and in accordance with the SCA)

unless (i) the Majority Secured Creditors have agreed to the same in writing or

(ii) one or other of the following Events of Default is outstanding: a payment

default, an insolvency event, unenforceability, invalidity/failure to grant

priority ranking of lease security, failure to maintain required insurances or

lessor/participants good faith opinion that non-exercise of rights in respect

of non-shared security would jeopardise recovery of uncovered portion (20%) of

Secured Debt under the Shared Security. For the avoidance of doubt, the prior

written consent of the Majority Secured Creditors is not required by the USPP

Noteholders to claim on or enforce the Rhodia Inc. or Rhodia Holding Inc.

guarantees.




 




•                                          Rights and remedies shall be exercised and

enforcement action taken(8) against the Non-Shared Security (where such

Security has become enforceable) by the Senior Secured Creditor benefiting

therefrom prior to being entitled to receive any proceeds of any Shared

Security.




 






















(8)                                  Time period to be agreed.




 




•                                          There may be a limited number of exceptions

to the above principle, for example with respect to Leases and/or Derivative

Instruments where the Company cannot provide the required amount of Derivative

Deposit or a creditor action required to preserve a claim in

insolvency/liquidation.




 




12.                               USPP Noteholders/Trustee:




 




•                                          USPP Noteholders will benefit from the credit

enhancement of Rhodia Inc. and Rhodia Holding Inc. (the “USPP Guarantors”) (to

be agreed) and benefit from the provisions of the Security Sharing Agreement

but will not be Senior Secured Creditors or parties thereto.




 




•                                          The contractual turnover mechanism would

provide that the Senior Secured Creditors agree to turnover an amount of net

enforcement proceeds with regard to the Shared Security to the USPP Noteholders

calculated by reference to the relevant Exposures/recoveries (to be agreed) to

the extent the USPP Noteholders have been unable to recover any debt through

their recourse to any guarantor of the notes.




 




•                                          No Senior Secured Creditor would have any

obligation to turnover any amount which would otherwise become due under the

Security Sharing Agreement to the USPP noteholders where in its good faith

opinion it would not be able to maintain and/or enforce an unsecured claim for

the full amount otherwise to be turned-over (whether as a result of a clawback

risk or otherwise).




 





























 




•                                          The Company will indemnify and hold harmless

each Secured Senior Creditor in a form to be agreed for any amounts turned over

by it to the USPP Noteholders (such indemnity claim will not be secured as

Secured Debt). Standard subrogation/assignment provisions to be included in the

Security Sharing Agreement in respect of amounts turned over to USPP

Noteholders.




 




•                                          No representation or warranty would be made

by any Senior Secured Creditor (or relevant Facility/Security Agents), the

Security Agent or the Intercreditor Agent to the USPP noteholders as to the

legality, enforceability, collectibility or value, maintenance, enforcement,

release or discharge of the Security.




 




•                                          No Senior Secured Creditor (nor relevant

Facility/Security Agents), the Security Agent or the Intercreditor Agent would

have any obligation to the USPP noteholders to monitor business, assets,

condition, operations, prospects, credit or the Security and USPP noteholders

will expressly waive any rights/recourse in respect thereof.




 




•                                          The USPP Noteholders will exercise rights and

remedies and take enforcement action(9) against Rhodia Inc and any other

guarantor prior to being entitled to receive any amount of the turnover

proceeds in respect of the Shared Security mentioned above (see

Payments/distributions below).




 






















(9)                                  Time period to be agreed.




 




•                                          The prior written consent of the Majority

Secured Creditors is not required by the USPP Noteholders to claim on or

enforce the USPP Guarantors’ guarantees.




 




13.                               Payments/distributions:




 




•                                          Enforcement proceeds of Shared Security will

be paid to and distributed by the Intercreditor Agent/Security Agent.




 




•                                          Enforcement proceeds of Non-Shared Security

will be paid to and distributed by the relevant Facility Agent or paid to the

relevant Secured Creditor.




 




•                                          An escrow arrangement will need to be

established pending receipt of proceeds of enforcement of Shared Security to

ensure that proceeds are not distributed prior to enforcement action(10)

against Non-Shared Security/existing guarantees and to preserve Senior Secured

Creditors net entitlement to any distribution such that Senior Secured

Creditors benefiting from Non-Shared Security are not disadvantaged in relation

to any other Secured Creditors.




 






















(10)                            Time period to be agreed.




 




•                                          The order of application of enforcement

proceeds is to be agreed.




 




14.                               Loss Sharing:




 




•                                          Each Senior Secured Creditor must account for

and deduct the amount of proceeds received from the enforcement of the

Non-Shared Security/existing guarantees from its global individual Exposure for

the purposes of determining its pro rata

entitlement to any proceeds of enforcement from the Shared Security.




 




•                                          No obligation on a Senior Secured Creditor to

share proceeds received from the enforcement of the Non-Shared

Security/existing guarantees.




 




•                                          Recoveries from enforcement over secured

Intercompany Loans will be treated on a pari

passu basis between Secured Senior Creditors having Shared Security

notwithstanding that if taken by way of a French law security (Loi Dailly) assignment this can only

secure the direct borrowing obligations of the Company and cannot secure its’

obligations as guarantor.




 




•                                          For the purposes of the Security Sharing

Agreement, set-off against deposits shall be dealt with in the same way as if

Shared/non-Shared Security, as the case may be.




 




•                                          General principle of loss-sharing in respect

of Shared Security as per the SCA.




 




•                                          The loss-sharing provisions in respect of

Shared Security only shall also be for the benefit of the USPP Noteholders.




 





























 




15.                                 Security Agent: 

Customary provisions for the appointment of Security Agent and standard

indemnity and other protections to be included.




 




16.                                 Co-operation between Senior

Secured Creditors:  Customary provisions concerning notification

of default, termination events, prepayment events, notification of amount of

Secured Debt under each Facility and authorisation by the Company for Senior

Secured Creditors to disclose information to each other.




 




17.                                 Transfers: 

Customary provisions to ensure that any transferee from a Secured Senior

Creditor accedes to and is bound by the Security Sharing Agreement.




 




18.                                 Several obligations:  The

obligations of each Senior Secured Creditor are several and no liability for

the obligations of any other Senior Secured Creditor; failure by one Senior

Secured Creditor to perform not affect rights/obligations of any other person.




 




19.                                 Amendments/waivers: 

Appropriate quorum for amendments/waivers to Security Sharing

Agreement/release of security to be agreed. Certain amendments (to be agreed)

to be subject to the approval of the Required Holders (as defined in the USPP)




 




20.                                 Governing law and

Jurisdiction:  English law by way of deed. Jurisdiction

clause to track SCA.




 




	

  Affected Facilities (as per


  Schedule 3 of the SCA)


  	

   


  	

  Pre-term

  date(11)


  Exposure secured by shared


  security


  	

   


  	

  Post-term

  date


  Exposure


  secured by


  shared security


  	

   


  	

  Pre-term

  date


  Non-shared security


  	

   


  	

  Post-term

  date


  Non-shared security


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

  Committed Bank lines/Refinancing Facilities Agreement


  	

   


  	

  100% of Exposure as set

  out in Schedule 3 of SCA


  	

   


  	

  As under the Refinancing

  Facilities Agreement


  	

   


  	

  Existing Security, if any,

  as per Part 1 of Schedule 4 of SCA under relevant Facility Agreement


  	

   


  	

  Existing security, if any,

  as per Part 1 of Schedule 4 of SCA under relevant Facility Agreement where

  not refinanced under the Refinancing Facilities Agreement


  
	

  Uncommitted Facilities including Overdraft Facilities


  	

   


  	

  100% of Exposure as set

  out in Schedule 3 of SCA as reduced in accordance with the SCA


  	

   


  	

  100% of Exposure at Term

  Date, not to exceed 100% of Exposure as set out in Schedule 3 of SCA as

  reduced in accordance with the SCA


  	

   


  	

  Existing security, if any,

  as per Part 1 of Schedule 4 of SCA under relevant Facility Agreement


  	

   


  	

  Existing security, if any,

  as per Part 1 of Schedule 4 of SCA under relevant Facility Agreement


  
	

  Leases


  	

   


  	

  80% of Exposure as set out

  in Schedule 3 of SCA (to include equity/recourse obligations) [as reduced in

  accordance with the SCA]


  	

   


  	

  80% of Exposure as set out

  in Schedule 3 of SCA as reduced in accordance with the SCA(12) [and after

  taking into account permitted lease payments during SCA]


  	

   


  	

  Existing security as per

  Part 1 of Schedule 4 of SCA under relevant Facility Agreement and where

  applicable 5% Lessor Reduction in accordance with Agreed Lease Agreement

  Principles


  	

   


  	

  Existing security as per

  Part 1 of SCA under relevant Facility Agreement and where applicable 5%

  Lessor Reduction on Term Date


  
	

  Letters of credit/banking guarantees


  	

   


  	

  30% of Exposure as set out

  in Schedule 3 of SCA and 100% of that Exposure in respect of a claim made by

  a Lender following a payment under that letter of credit or guarantee by that

  Lender (except in respect of a payment under an “extend or pay” letter of

  creditor or guarantee made at the time of its maturity


  	

   


  	

  30% of Exposure as set out

  in Schedule 3 of SCA except for letters of credit/banking guarantees (i)

  maturing post-Term Date to be negotiated on a bilateral basis upwards or

  downwards on or around the maturity date or (ii) counter-indemnified under

  the Refinancing Facilities Agreement


  	

   


  	

  Existing security as per

  Part 1 of Schedule 4 of SCA under relevant Facility Agreement


  	

   


  	

  Existing security as per

  Part 1 of Schedule 4 of SCA under relevant Facility Agreement and cash

  collateral and/or a counter-guarantee under the Refinancing Facilities

  Agreement up to a maximum aggregate amount to be agreed


  
	

  Derivative Instruments


  	

   


  	

  100% of its Derivative

  Liability up to the maximum Exposure under that Derivative Instrument as set

  out in Schedule 3 of SCA


  	

   


  	

  100% of its Derivative

  Liability up to the maximum Exposure under that Derivative Instrument as set

  out in Schedule 3 of the SCA


  	

   


  	

  Derivative Deposit as per

  the SCA up to a maximum aggregate amount for all Derivative Instruments not

  exceeding Euros 40,000,000


  	

   


  	

  Derivative Deposit as per

  the SCA up to a maximum aggregate amount for all Derivative Instruments not

  exceeding the amount secured at the Term Date


  





 




 




	

  Non-Affected Facilities (as


  per Schedule 3 of the SCA)


  	

   


  	

  Pre-term

  date(11)


  Exposure secured by shared


  security


  	

   


  	

  Post-term

  date


  Exposure


  secured by


  shared security


  	

   


  	

  Pre-term

  date


  Non-shared security


  	

   


  	

  Post-term

  date


  Non-shared security


  
	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  	

   


  
	

  High Yield Bonds


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  
	

  USPP


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

   


  
	

  EMTN


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  
	

  Credit facilities (committed and uncommitted bank lines and overdrafts)


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  
	

  Securitisations


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  
	

  Sales of receivables/forfeiting


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  
	

  Operating leases


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  
	

  Letters of credit/banking guarantees


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  
	

  Forfeiting programmes


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  	

   


  	

  None


  





 






















(11)                            Dilution percentage Secured Debt to Shared

Security approximately 91/98%.




 




(12)                            Schedule 3 will be updated to reflect agreed

commercial terms and Exposure as reduced.




 





























 




SIGNATORIES




 




	

  The

  Company


  
	

   


  
	

  RHODIA S.A.


  
	

   


  
	

  By:


  
	

   


  
	

  Original

  Obligors


  
	

   


  
	

  RHODIA POLIAMIDA E

  ESPECIALIDADES LTDA.


  
	

   


  
	

  By:


  
	

   


  
	

  RHODIA HENGCHANG

  (ZHANGJIAGANG) SPECIALTY CHEMICAL CO. LTD


  
	

   


  
	

  By:


  
	

   


  
	

  RHODIA WUXI PHARMACEUTICAL

  CO. LTD


  
	

   


  
	

  By:


  
	

   


  
	

  RHODIA S.A.


  
	

   


  
	

  By:


  
	

   


  
	

  RHODIA JAPAN LTD


  
	

   


  
	

  By:


  
	

   


  
	

  RHODIA FOSFATADOS DE MEXICO

  S.A. DE CV


  
	

   


  
	

  By:


  
	

   


  
	

  RHODIA CAPITAL MARKET (ex

  RHONE-POULENC (SUISSE) S.A.)


  
	

   


  
	

  By:


  
	

   


  
	

  RHODIA ENGINEERING

  PLASTICS Co, Ltd


  
	

   


  
	

  By:


  
	

   


  
	

  RHODIA INC


  
	

   


  
	

  By:


  
	

   


  
	

  RHODIA ACETOW VENEZUELA

  C.A.


  
	

   


  
	

  By:


  
	

   


  
	

  RHODIA CHINA CO. LIMITED


  
	

   


  
	

  By:


  
	

   


  
	

  The

  Guarantor


  
	

   


  
	

  RHODIA S.A.


  
	

   


  
	

  By:


  
	

   


  
	

  Original

  Lenders


  
	

   


  
	

  BNP PARIBAS


  
	

   


  
	

  By:


  
	

   


  
	

  CRÉDIT LYONNAIS S.A.


  
	

   


  
	

  By:


  
	

   


  
	

  CRÉDIT INDUSTRIEL ET

  COMMERCIAL


  
	

   


  
	

  By:


  
	

   


  
	

  BANQUE DE L’ECONOMIE DU

  COMMERCE ET DE LA MONETIQUE


  
	

   


  
	

  By:


  
	

   


  
	

  CSFB


  
	

   


  
	

  By:


  
	

   


  
	

  WACHOVIA


  
	

   


  
	

  By:


  
	

   


  
	

  BAYERISCHE LANDESBANK


  
	

   


  
	

  By:


  
	

   


  
	

  SOCIÉTÉ GÉNÉRALE


  
	

   


  
	

  By:


  
	

   


  
	

  THE BANK OF

  TOKYO-MITSUBISHI, LTD.


  
	

   


  
	

  By:


  
	

   


  
	

  FORTIS BANK N.V.


  
	

   


  
	

  By:


  
	

   


  
	

  NATEXIS BANQUES POPULAIRES


  
	

   


  
	

  By:


  
	

   


  
	

  CCF


  
	

   


  
	

  By:


  
	

   


  
	

  STANDARD CHARTERED BANK


  
	

   


  
	

  By:


  
	

   


  
	

  THE ROYAL BANK OF SCOTLAND

  PLC


  
	

   


  
	

  By:


  
	

   


  
	

  BANCO BILBAO VIZCAYA

  ARGENTARIA


  
	

   


  
	

  By:


  
	

   


  
	

  JPMORGAN CHASE BANK


  
	

   


  
	

  By:


  
	

   


  
	

  ING BANK N.V.


  
	

   


  
	

  By:


  
	

   


  
	

  UNICREDITO ITALIANO


  
	

   


  
	

  By:


  
	

   


  
	

  UFJ NEDERLAND N.V.


  
	

   


  
	

  By:


  
	

   


  
	

  UFJ BANK LIMITED


  
	

   


  
	

  By:


  
	

   


  
	

  CITIBANK INTERNATIONAL PLC


  
	

   


  
	

  By:


  
	

   


  
	

  LANDES GIROZENTRALE


  
	

   


  
	

  By:


  
	

   


  
	

  COMERICA


  
	

   


  
	

  By:


  
	

   


  
	

  Intercreditor

  Agent


  
	

   


  
	

  BNP PARIBAS


  
	

   


  
	

  By:


  
	

   


  
	

  Agents

  under Affected Facilities


  
	

   


  
	

  BNP PARIBAS


  
	

   


  
	

  By: