Document:

Exhibit 10.2

 

 

INTERCREDITOR
AGREEMENT

 

THIS
INTERCREDITOR AGREEMENT (this “Agreement”) is entered into as of August 16, 2005,
by and among (i) Deutsche Bank AG New York Branch (“DBAG”), acting
in its capacity as Administrative Agent under the Credit Agreement (as
hereinafter defined) (together with its successors and assigns in such
capacity, the “Administrative Agent”), (ii) Deutsche Bank AG New
York Branch, acting in its capacity as collateral agent under the Security
Agreement (as hereinafter defined), and in its capacity as collateral agent
under the UK Debenture (as hereinafter defined) (together with its successors
and assigns in such capacity, the “Bank and Note Collateral Agent”), (iii) Deutsche
Bank AG New York Branch, as beneficiary for the benefit of the Secured
Creditors under the Mortgages (as hereinafter defined) (together with its
successors and assigns in such capacity, the “Mortgagee”) and (iv) HSBC
Bank USA, National Association (as successor to HSBC Bank USA), as trustee for
the holders of Senior Secured Notes (as defined below) issued under the Senior
Secured Notes Indenture (as hereinafter defined) (in such capacity, together
with its successors and assigns in such capacity, the “Senior Secured Notes
Trustee”), and is acknowledged and consented to by Huntsman International
LLC, a Delaware limited liability company (“Borrower”).

 

R E
C I T A L S

 

WHEREAS, Deutsche
Bank Trust Company Americas (“DB”), as First Priority Bank Agent, DB, as
First Priority Collateral Agent, DB, as Second Priority Bank Agent, DB, as
Second Priority Collateral Agent, DB, as Mortgagee, the Senior Secured Notes
Trustee and Borrower are parties to a Second Amended and Restated Intercreditor
Agreement dated as of October 14, 2004 (the “Prior Intercreditor
Agreement”);

 

WHEREAS, Huntsman
LLC, a Utah limited liability company (“HLLC”), has issued $455.4
million in aggregate principal amount of 11-5/8% Senior Secured Notes due 2010
(such notes, together with any exchange notes and additional notes (the “Senior
Secured Notes”)) issued under the Indenture dated as of September 30,
2003 among HLLC, the guarantors named therein and the Senior Secured Notes
Trustee (as amended, supplemented or otherwise modified from time to time, in
accordance with the terms hereof, the “Senior Secured Notes Indenture”);

 

WHEREAS, on the
Closing Date (as defined in the Credit Agreement), HLLC will merge with and
into the Borrower, with the Borrower as the surviving entity (the “Merger”);

 

WHEREAS,
contemporaneously herewith, Borrower, the Administrative Agent and the lenders
parties thereto are entering into the Credit Agreement to repay in full,
extinguish and replace (i) that certain Revolving Credit Agreement dated
as of October 14, 2004 by and among HLLC, DB, as administrative agent and
the lenders party thereto, (ii) that certain Credit Agreement dated as of October 14,
2004 by and among HLLC, DB, as administrative agent and collateral agent and
the lenders party thereto and (iii) that certain Credit Agreement dated as
of July 13, 2004 by and among Borrower, Huntsman International Holdings
LLC, the financial 

 

 

institutions party
thereto, DB, as administrative agent, and the co-lead arrangers, co-syndication
agents and co-documentation agents identified therein;

 

WHEREAS,
contemporaneously herewith, in order to secure the Obligations (as defined
herein), Borrower, certain subsidiaries of Borrower parties thereto and the
Bank and Note Collateral Agent are entering into a Collateral Security
Agreement (as amended, replaced, modified, extended, renewed, supplemented,
restated or replaced (in connection with a Refinancing or otherwise) or
otherwise modified from time to time, the “Security Agreement”);

 

WHEREAS,
contemporaneously herewith, Borrower and certain subsidiaries of Borrower are
granting certain mortgages to secure the Obligations; and

 

WHEREAS, the Bank
and Note Collateral Agent, the Administrative Agent, the Mortgagee, the Senior
Secured Notes Trustee and Borrower desire to enter into this Agreement for the
purpose of setting forth the rights and obligations of the Collateral Agents
(as defined herein) and the respective secured parties with respect to the
Collateral.

 

NOW, THEREFORE, in
consideration of the premises and the mutual agreements set forth herein, and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree as follows:

 

Section 1.              Defined Terms.  As used in
this Agreement, the following terms shall have the following meanings (all such
meanings to be equally applicable to both the singular and plural forms of the
terms defined):

 

“Administrative Agent”
shall have the meaning set forth in the first paragraph of this Agreement.

 

“Assignor” shall
mean any Assignor (as defined in the Security Agreement).

 

“Bank and Note
Collateral Agent” shall have the meaning set forth in the first paragraph
of this Agreement.

 

“Bank Obligations”
shall mean Bank Obligations (as defined in the Security Agreement), together
with any obligations incurred to evidence any refunding, Refinancing,
replacement or successive refunding, Refinancing or replacement thereof.

 

“Bank Secured
Creditors” shall mean all holders of the Bank Obligations.

 

“Bankruptcy Code”
shall mean the provisions of Title 11 of the United States Code, 11 U.S.C. 101
et seq. or any other applicable bankruptcy, insolvency or similar laws.

 

“Bankruptcy Event”
shall mean the occurrence of any of the events described in Sections 10.1(e) or
(f) of the Credit Agreement.

 

“Bankruptcy Proceeding”
shall mean, with respect to any Person, any proceeding commenced, without the
application or consent of such Person, in any court, seeking the liquidation,
reorganization, debt arrangement, dissolution, winding up, or composition or
readjustment of debts of such Person, the appointment of a trustee, receiver,
custodian, 

 

2

 

liquidator,
assignee, sequestrator or the like for such Person or any substantial part of
its assets, or any similar action with respect to such person under any law
(foreign or domestic) relating to bankruptcy, insolvency, reorganization,
winding up or composition or adjustment of debts or any voluntary case or other
proceeding under any applicable bankruptcy, insolvency, reorganization, debt
arrangement, dissolution or other similar law now or hereafter in effect.

 

“Borrower” shall
have the meaning provided in the first paragraph of this Agreement.

 

“Collateral” shall
mean the property from time to time consisting of Collateral (as defined in the
Security Agreement), the Mortgaged Property (as defined in the Mortgages) and
any other property from time to time pledged pursuant to any Security Document
other than the Excluded Collateral.

 

“Collateral Agents”
shall mean the Bank and Note Collateral Agent and the Mortgagee.

 

“Credit Agreement”
shall mean that certain Credit Agreement by and among Borrower, DBAG, as
administrative agent, Deutsche Bank Securities Inc., as joint lead arranger and
joint book runner, Citigroup Global Markets Inc., as co-syndication agent, joint
lead arranger and joint book runner, and Credit Suisse, as co-syndication agent
and joint book runner and the lenders parties thereto, together with any
agreement or agreements from time to time executed by Borrower to evidence any
refunding, Refinancing, replacement or successive refunding, Refinancing or
replacement of all or any part of the Bank Obligations, together with any
amendments, replacements, modifications, extensions, renewals or supplements
to, or restatements of, any of the foregoing.

 

“Credit Documents”
shall mean the Loan Documents, the Senior Secured Note Indenture and the notes
issued thereunder.

 

“Credit Party”
shall mean any Credit Party (as defined in the Credit Agreement).  The term “Credit Parties” shall have a
correlative meaning.

 

“DB” shall have
the meaning set forth in the Recitals hereto.

 

“DBAG” shall have
the meaning set forth in the first paragraph of this Agreement.

 

“Excluded Collateral”
shall mean the Collateral (as defined in the Pledge Agreement).

 

“Fully Paid” shall
mean, with respect to any Obligation, that the obligee of such Obligation shall
have certified to the Bank and Note Collateral Agent that such Obligation has
terminated and that there remain no obligations of any kind whatsoever of the
Borrower or any Credit Party with respect thereto (other than contingent
indemnification obligations as to which no claims shall have accrued or shall
be pending).

 

“Instructing Group”
shall mean the Instructing Group (as defined in the Security Agreement).

 

3

 

“Lender” shall
mean any Lender as defined in the Credit Agreement, together with its
respective successors and assigns in such capacity.

 

“Liens” shall mean
Liens as defined in the Credit Agreement.

 

“Loan Documents”
shall mean the Loan Documents (as defined in the Credit Agreement) and all
other documents, instruments and agreements now or hereafter evidencing or
securing the whole or any part of the Bank Obligations (including, without
limitation, each of the loan documents as defined in any principal agreement
evidencing the Bank Obligations, including any documents evidencing or securing
any complete, partial or successive refunding, Refinancing or replacement of
the Bank Obligations, together with any amendments, replacements,
modifications, extensions, renewals or supplements to, or restatements of, any
of the foregoing).

 

“Mortgagee” shall
have the meaning set forth in the first paragraph of this Agreement.

 

“Mortgages” shall
mean Mortgages (as defined in the Credit Agreement).

 

“Obligations”
shall mean the Bank Obligations and the Senior Secured Notes Obligations.

 

“Other Collateral
Agent” shall mean (i) with respect to the Bank and Note Collateral
Agent, the Mortgagee and (ii) with respect to the Mortgagee, the Bank and
Note Collateral Agent.

 

“Person” shall
mean Person as defined in the Credit Agreement.

 

“Pledge Agreement”
shall mean Pledge Agreement as defined in the Credit Agreement.

 

“Prior Intercreditor
Agreement” shall have the meaning set forth in the Recitals hereto.

 

“Refinance” shall
mean, with respect to any Obligation, to refinance, extend, renew, repay,
prepay, redeem, defease or retire, or to issue indebtedness in exchange or
replacement for, such Obligation.  “Refinancing”
has a correlative meaning.

 

“Secured Creditors”
shall mean all holders of the Obligations.

 

“Security Agreement”
shall have the meaning set forth in the Recitals hereto.

 

“Security Documents”
shall mean the Security Agreement and all other Security Documents as defined
in the Credit Agreement, other than the Pledge Agreement and the UK Pledge
Agreements.

 

“Senior Secured
Noteholders” shall mean the holders of the Senior Secured Notes
Obligations.

 

4

 

“Senior Secured Notes”
shall have the meaning set forth in the Recitals hereto.

 

“Senior Secured Notes
Indenture” shall have the meaning set forth in the Recitals hereto.

 

“Senior Secured Notes
Obligations” shall mean Senior Secured Notes Obligations as defined in the
Security Agreement.

 

“Senior Secured Notes
Trustee” shall have the meaning set forth in the first paragraph of this
Agreement.

 

“UK Debenture”
shall mean UK Debenture as defined in the Credit Agreement.

 

“UK Pledge Agreements”
shall mean UK Pledge Agreements as defined in the Credit Agreement.

 

“Uniform Commercial
Code” shall mean the Uniform Commercial Code as in effect from time tom
time in the relevant jurisdiction.

 

Section 2.              Lien Priorities.

 

(a)           (i)            The
parties hereto hereby agree that, notwithstanding the time, order or method of
creation, attachment or perfection of the respective security interests and/or
Liens granted in favor of the Collateral Agents to secure the Obligations or
the filing or recording of financing statements or other Security Documents;
the validity or enforceability of the security interests and Liens granted in
favor of the Collateral Agents or the Secured Creditors; the dating, execution
or delivery of any agreement, document or instrument granting any Collateral
Agent or Secured Creditor security interests and/or Liens in or on any or all
of the property or assets of any pledgor; the date on which any indebtedness is
extended; the giving or failure to give notice of the acquisition or expected
acquisition of any purchase money or other security interest; any provision of
the Uniform Commercial Code, including any rule for determining priority
thereunder or under any other law or rule governing the relative
priorities of secured creditors, including with respect to real property or
fixtures; any provision set forth in any Loan Document or the Senior Secured
Notes Indenture or the Senior Secured Notes; or the possession or control by
any Collateral Agent or Secured Creditor or any bailee of all or any part of
any Collateral as of the date hereof or otherwise, the Liens granted on the
Collateral under the Security Documents to secure the Obligations shall at all
times secure the Bank Obligations and the Senior Secured Note Obligations on a
pari passu basis.

 

(ii)           Notwithstanding
the terms of any Loan Document or the Senior Secured Notes Indenture, in the
event of any enforcement of any Liens or in connection with a Bankruptcy
Proceeding, all proceeds of Collateral, including the proceeds of any
collection, sale or disposition of the Collateral or any portion thereof in
connection with the exercise of remedies under the Security Documents or
otherwise and any proceeds or recoveries under any title insurance policy(ies)
insuring any Mortgage, shall be distributed in accordance with Section 8.5
of the Security Agreement.

 

5

 

(iii)          In
the event that the Administrative Agent or the Senior Secured Note Trustee
receives the proceeds of any Collateral in contravention of the preceding
paragraph (ii), it shall hold such proceeds in trust for, and promptly turn
over such proceeds (in the same form as received, with any necessary
non-recourse endorsement) to the proper Person in accordance with the
provisions of clause (ii) above; provided, however, that in
the event such Person fails to provide any such endorsement, the Administrative
Agent, or the Senior Secured Notes Trustee, as the case may be, or any of its
respective officers or employees, is hereby irrevocably authorized to make the
same (which authorization, being coupled with an interest, is irrevocable).

 

(iv)          Each
of the parties hereto acknowledges that the Lien priorities provided in this
Agreement shall not be affected or impaired in any manner whatsoever,
including, without limitation, on account of (A) the invalidity,
irregularity or unenforceability of all or any part of the Loan Documents, the
Senior Secured Notes Indenture or the Senior Secured Notes; (B) any
amendment, change or modification of any Loan Document, the Senior Secured
Notes Indenture or the Senior Secured Notes; or (C) any impairment,
modification, change, exchange, release or subordination of or limitation on,
any liability of, or stay of actions or lien enforcement proceedings against,
any Credit Party, its property, or its estate in bankruptcy resulting from any
bankruptcy, arrangement, readjustment, composition, liquidation,
rehabilitation, similar proceeding or otherwise involving or affecting any
Credit Party.

 

(b)           Each
Collateral Agent hereby appoints each other as agent for purposes of perfecting
its respective security interests, Liens and claims in the Collateral (in each
case, whether such Collateral was delivered to the Bank and Note Collateral
Agent or the Mortgagee, as the case may be, prior to, on or after the date
hereof), in each case to the extent that such perfection may be obtained by
possession or control and hereby acknowledges that it holds possession of such
Collateral, including, without limitation, any instruments, for the benefit of
the other Collateral Agent.

 

(c)           The
parties hereto shall not challenge or question in any proceeding the validity,
perfection, priority or enforceability of this Agreement, as a whole, or any
term or provision contained herein or the validity or enforceability of any
Lien, Mortgage or financing statement in favor of any Collateral Agent or the
relative priority of any such Lien or Mortgage.

 

(d)           In
the event of any Refinancing of the Bank Obligations, the Senior Secured Notes
Trustee, for itself and the Senior Secured Noteholders, does hereby confirm
(and, upon request, agrees to reconfirm at any time) the continued
applicability of the provisions hereof, including the pari passu nature of the
Liens securing the Senior Secured Notes Obligations and the Liens securing any
Bank Obligations incurred or refinanced as a result of such Refinancing.  In connection with any Refinancing of all or
any portion of the Secured Obligations prior to the occurrence of a Bankruptcy
Event, the Senior Secured Notes Trustee, on behalf of itself and each Senior
Secured Noteholder, shall, if requested by Borrower or the existing or new
holders of the Bank Obligations, execute an intercreditor agreement or amend
and restate this Agreement in a manner that is substantially similar to this
Agreement with the lenders under such Refinancing.

 

(e)           [Reserved].

 

6

 

(f)            The
Senior Secured Notes Trustee, on behalf of itself and the Senior Secured
Noteholders, hereby waives any requirement on the part of the Bank and Note
Collateral Agent or the Lenders in respect of marshalling of assets
constituting Collateral upon any exercise of remedies by the Bank and Note
Collateral Agent or the Bank Secured Creditors and, except as expressly set
forth herein, any requirement that the Bank and Note Collateral Agent or any
Bank Secured Creditor exercise remedies with respect to collateral security for
the Obligations in any particular order or any particular manner.

 

(g)           Nothing
in this Agreement shall relieve any Assignor from the performance of any term,
covenant, condition or agreement on such Assignor’s part to be performed or
observed under or in respect of any of the Collateral pledged by it or from any
liability to any Person under or in respect of any of such Collateral or impose
any obligation on any Collateral Agent to perform or observe any such term,
covenant, condition or agreement on such Assignor’s part to be so performed or
observed or impose any liability on any Collateral Agent for any act or
omission on the part of such Assignor relative thereto or for any breach of any
representation or warranty on the part of such Assignor contained in this
Agreement or any other Loan Document or the Senior Secured Notes Indenture, or
in respect of the Collateral pledged by it. 
The obligations of each Assignor described in this paragraph shall
survive the termination of this Agreement and the discharge of such Assignor’s
other obligations hereunder.

 

Section 3.              Certain Intercreditor Agreements
Regarding Refinancing of Bank Obligations, Amendments to Loan Documents and
Related Matters.

 

(a)           The
Senior Secured Notes Trustee agrees, acknowledges and consents that, until the
Bank Obligations are Fully Paid, at any time and from time to time without the
consent of or notice to the Senior Secured Notes Trustee or any Senior Secured
Noteholder and, without incurring responsibility to the Senior Secured Notes
Trustee or any Senior Secured Noteholder, and without impairing or releasing
the obligations hereunder, any or all of the Loan Documents and/or any or all
of the Bank Obligations thereunder may be Refinanced, refunded, replaced,
amended, extended, renewed, restated, supplemented or otherwise modified in any
way whatsoever, including, without limitation, to:

 

(i) shorten
or extend the final maturity of all or any part of the Bank Obligations, (ii) modify
the amortization of the principal amount of all or any part of the Bank
Obligations, (iii) to the extent permitted by the Senior Secured Notes
Indenture, increase the principal amount of the Bank Obligations, or otherwise
provide for additional advances and grant any lien, mortgage, pledge,
hypothecation, collateral assignment, security interest, encumbrance, charge,
deposit arrangement or other similar encumbrance to secure any such increased
indebtedness and, irrespective of the time, order or method of creation,
attachment or perfection thereof or the filing or recording thereof, make any
such lien, mortgage, pledge, hypothecation, collateral assignment, security
interest, encumbrance, charge, deposit arrangement or other similar
encumbrance, in each case subject to Section 2, including the lien
priorities set forth set forth therein, (iv) raise the standard or default
interest rates applicable to all or any part of the Bank Obligations, (v) impose
any additional fees or penalties upon Borrower or any of its subsidiaries or
increase the amount of or rate for any fees or penalties provided for in the
Loan Documents, (vi) retain or obtain a lien, mortgage, pledge,
hypothecation, collateral assignment, security

 

7

 

interest,
encumbrance, charge, deposit arrangement or other similar encumbrance on any
property to secure any of the Obligations, (vii) enter into any new,
replaced, amended, extended, renewed, restated, supplemented or otherwise
modified Loan Documents, (viii) change the manner, place or terms of
payment or extend the time of payment of, or renew or alter, all or any of the
Bank Obligations or otherwise Refinance, refund, replace, amend, extend, renew,
restate, supplement or otherwise modify in any manner, or grant any waiver,
forbearance or release with respect to, all or any part of the Bank Obligations
or any Loan Document, (ix) retain or obtain the primary or secondary
obligation of any other Person with respect to any of the Bank Obligations, (x)
release any Person liable in any manner under or in respect of Bank Obligations
or, acting in accordance with the relevant Security Documents, release or
compromise any obligation of any nature of any Person with respect to any of
the Obligations, (xi) except to the extent in violation of the Senior Secured
Notes Indenture, sell, exchange, not perfect or otherwise deal with any
property at any time pledged, assigned or mortgaged to secure or otherwise securing,
all or any part of the Obligations, including without limitation, any
Collateral, (xii) subject to Section 4, release its security
interest in, or surrender, release or permit any substitution or exchange for,
all or any part of any property securing any Obligations, or release,
compromise, alter or exchange any obligations of any nature of any Person with
respect to any such property, (xiii) amend or grant any waiver or release with
respect to, or consent to any departure from, any guaranty of all or any of the
Bank Obligations, (xiv) grant any lien, mortgage, pledge, hypothecation,
collateral assignment, security interest, encumbrance, charge, deposit
arrangement or other similar encumbrance, (xv) exercise or refrain from
exercising any rights or remedies against and release from obligations of any
type (other than the Senior Secured Notes Obligations), Borrower or any of its
subsidiaries or any other Person, (xvi) replace the Administrative Agent, Bank
and Note Collateral Agent, Mortgagee or any Lender, whether or not in
connection with a Refinancing and (xvii) otherwise manage and supervise the
Bank Obligations in accordance with such person’s usual practices, modified
from time to time as such person deems appropriate under the circumstances.

 

(b)           The
Senior Secured Notes Trustee, for itself and on behalf of the Senior Secured
Noteholders, hereby irrevocably constitutes and appoints the Bank and Note
Collateral Agent and any officer or agent of the Bank and Note Collateral
Agent, with full power of substitution, as its true and lawful attorney-in-fact
with full irrevocable power and authority in the place and stead of the Senior
Secured Notes Trustee or such holder or in the Bank and Note Collateral Agent’s
own name, from time to time in the Bank and Note Collateral Agent’s discretion,
for the purpose of carrying out the terms of this Section 3, to
take any and all appropriate action and to execute and record any and all
documents and instruments which may be necessary or desirable to accomplish the
purposes of this Section 3, including, without limitation, any
financing statements, endorsements or other instruments of transfer or
release.  In connection therewith, the
Bank and Note Collateral Agent acknowledges its appointment under Section 11.03
of the Senior Secured Notes Indenture as “Second Priority Collateral Agent” for
the benefit of the Senior Secured Notes Trustee and the holders of the Senior
Secured Notes, subject to all terms and conditions set forth in the Senior
Secured Notes Indenture.

 

(c)           In
connection with any Refinancing, refunding, replacement, amendment, extension,
renewal, restatement, supplement or other modification of all or any portion of
the Obligations prior to the occurrence of a Bankruptcy Event, the Senior
Secured Notes Trustee, on behalf of each Senior Secured Noteholder, does hereby
(i) confirm (and, upon written request,

 

8

 

agrees to reconfirm at any time) the continued
applicability of the provisions hereof and (ii) consent to any successor,
replacement or assignee of the Administrative Agent or Mortgagee becoming party
to this Agreement and/or the Security Agreement or any Loan Document (including
by execution of an assignment or joinder agreement or other equivalent instrument)
without any additional consent or approval of the Senior Secured Notes Trustee;
provided, however, that, notwithstanding the foregoing, the
Senior Secured Notes Trustee shall, if requested, in writing, by the Borrower,
the Administrative Agent, or the Mortgagee (or any successor, replacement or
assignee thereof), or any existing or new holder of Obligations, upon receipt
of the documents required by Section 9.06 of the Senior Secured Notes
Indenture, execute an intercreditor agreement, or an amendment to or
restatement of this Agreement substantially similar to this Agreement
(incorporating such amendments, modifications, waivers or variances which do
not materially adversely affect the rights and benefits of the holders of the
Senior Secured Notes in a different manner than the other Secured Creditors).

 

Section 4.              Release of Liens.

 

(a)           Subject
to the provisions of Section 4(b), each of the Bank and Note
Collateral Agent and the Mortgagee may, at any time or from time to time,
acting in accordance with the Security Agreement, or, in the case of any
Mortgage, the terms of the Credit Agreement, as the case may be, release any
Liens held by such Collateral Agent against all or any portion of the
Collateral.

 

(b)           If
(i) the Bank and Note Collateral Agent releases the Liens on all
Collateral in respect of all Bank Obligations, or (ii) all Bank
Obligations are Fully Paid, then all the Liens on the Collateral securing the
Senior Secured Notes Obligations will be automatically released and terminated
and the Bank and Note Collateral Agent shall have no further duties or
obligations under the Security Documents; provided, however, in
the case of either clause (i) or (ii) above, if a Default or Event of
Default shall have occurred and be continuing under the Senior Secured Notes
Indenture, the Liens on the Collateral securing the Senior Secured Notes
Obligations shall not be released and the Security Agreement shall not
terminate until such time as the Default or Event of Default is cured or waived
in accordance with the Senior Secured Notes Indenture.

 

(c)           Subject
to Section 4(b), the Senior Secured Notes Trustee agrees that its
consent shall not be required in connection with the release of all or any
portion of the Collateral at any time, including, without limitation, any time
that a Default or Event of Default shall have occurred and be continuing under
the Senior Secured Notes Indenture.

 

Section 5.              Notice of Intent to Foreclose.

 

(a)           The
Bank and Note Collateral Agent will give the Senior Secured Notes Trustee notice
of its intent to enforce any Lien upon any of the Collateral.  The notice required by this Section 5(a) shall
be required to be given by the Bank and Note Collateral Agent only if it
intends to:

 

(i)            deliver
to any Credit Party written notice of its intent to enforce a Lien in full or
partial satisfaction of any obligation secured thereby;

 

9

 

(ii)           commence
legal action against any Credit Party for foreclosure or replevin or other
enforcement of a Lien; or

 

(iii)          take
possession of or title to, or deliver to any third party possession of or title
to, any real or personal property of any Credit Party (other than possession of
cash in accounts expressly contemplated by the Credit Documents or possession
of property by the Administrative Agent as a means of perfection);

 

(b)           The
notice required by Section 5(a):

 

(i)            shall
not be required in any other instance or as to any other action or event
(including, for purposes of illustration and not by way of limitation, any
incurrence, payment or acceleration of any of the Obligations or any amendment
or waiver of the terms thereof, any exercise of a right of setoff, any
notification to account debtors to make payment directly to the secured party
or any other exercise of collection rights or the institution of any other
legal proceedings, including suit to collect any debt or claim or the
commencement of any bankruptcy case, receivership or insolvency proceeding);

 

(ii)           need
only state that it is given pursuant to the provisions of this Agreement and
that Lien enforcement action may be taken by the party giving the notice, and
need not disclose or describe the action to be taken; and

 

(iii)          shall
be given at least five (5) business days prior to the date on which any enforcement
action described above is taken, except that a party may give such notice
promptly after taking such enforcement action if it in good faith believes that
immediate enforcement action is or may be required to protect its interest in
the property subject to its Liens.

 

(c)           No
liability or defense shall arise, no Lien shall be lost, invalidated or
impaired, and no action taken in enforcement of a Lien shall be annulled, set
aside, affected, or impaired, as a result of any notice required by this Agreement
not being given or being defectively given.

 

Section 6.              [Reserved].

 

Section 7.              Exercise of Remedies - Senior
Secured Notes Trustee.

 

(a)           Notwithstanding
anything to the contrary in this Agreement or the Senior Secured Notes
Indenture, until the Bank Obligations are Fully Paid and, so long as all Liens
securing the Senior Secured Notes Obligations have not been released, (i) neither
the Senior Secured Notes Trustee nor any Senior Secured Noteholder shall have
any right or power to exercise or seek to exercise any rights or remedies
(including setoff or recoupment) with respect to any Collateral (other than to
receive a share of the Proceeds (as defined in the Security Agreement or the
applicable Mortgage, as the case may be) of such Collateral, if any, as and
when provided in the Security Agreement or the applicable Mortgage, as the case
may be), including, without limitation, the following: (w) to institute any
action or proceeding with respect to any Collateral, including, without
limitation, any action of foreclosure, (x) contest, protest or object to (1) any
foreclosure proceeding or action brought by the Administrative Agent or any
Collateral Agent, (2) the exercise of any right under any lockbox
agreement, control agreement, landlord waiver or bailee’s letter or similar
agreement or arrangement to which the Administrative Agent or any

 

10

 

Lender is a party, or (3) any other exercise by
any such party of any rights and remedies relating to the Collateral under any
Loan Document or otherwise, (y) object to the forbearance by the Administrative
Agent or any Lender from bringing or pursuing any foreclosure proceeding or
action or any other exercise of any rights or remedies relating to the
Collateral or (z) demand, accept or obtain any lien, mortgage, pledge,
hypothecation, collateral assignment, security interest, encumbrance, charge,
deposit arrangement or other similar encumbrance on any Collateral (other than
from time to time as granted pursuant to the Security Agreement or the
Mortgages); and (ii) the Collateral Agents acting at the direction of the
Administrative Agent and the Lenders shall have the exclusive right to enforce
rights, exercise remedies (including, without limitation, setoff, recoupment
and the right to credit bid any Obligations) and make determinations regarding
release (subject to Section 4), disposition, or restrictions with
respect to the Collateral without any consultation with or the consent of the
Senior Secured Notes Trustee or any Senior Secured Noteholder.  In exercising rights and remedies with
respect to the Collateral, the Administrative Agent and the Lenders may (acting
in accordance with the terms of the applicable Loan Documents) enforce the
provisions of the Loan Documents and exercise remedies thereunder, all in such
order and in such manner as they may determine in the exercise of their sole
discretion.  Such exercise and
enforcement shall include, without limitation, the rights of an agent or other
representative appointed by them to sell or otherwise dispose of Collateral
upon foreclosure, to incur expenses in connection with such sale or
disposition, and to exercise all the rights and remedies of a secured lender
under the Uniform Commercial Code of any applicable jurisdiction and of a
secured creditor under bankruptcy or similar laws of any applicable
jurisdiction.

 

(b)           [Reserved].

 

(c)           The
Senior Secured Notes Trustee, for itself and on behalf of the Senior Secured
Noteholders, agrees that the Senior Secured Notes Trustee and the Senior
Secured Noteholders will not take any action that would hinder any exercise of
remedies undertaken by the Collateral Agents under the Security Documents or by
the Administrative Agent or the Lenders under the Loan Documents, including any
sale, lease, exchange, transfer or other disposition of the Collateral, whether
by foreclosure or otherwise.

 

(d)           Without
limiting the generality of the foregoing, in any bankruptcy case of a pledgor
of Collateral, neither the Senior Secured Notes Trustee nor the Senior Secured
Noteholders shall directly or indirectly (i) object to the terms of any
use of cash collateral or debtor in possession financing consented to by the
Administrative Agent, or file any pleading with respect to use of cash collateral
or debtor in possession financing without the prior express written consent of
the Administrative Agent in each instance, provided the Senior Secured
Notes Obligations and Bank Obligations are treated similarly in connection with
any such use of cash collateral or financing, (ii) object to any adequate
protection, including additional or replacement liens or administrative
priority claims, consented to by the Administrative Agent, or file any pleading
with respect to any such adequate protection, without the prior express written
consent of the Administrative Agent in each instance, provided the
Senior Secured Notes Obligations and Bank Obligations are treated similarly in
connection with any such adequate protection, (iii) seek relief from the
automatic stay, or object to any relief from the automatic stay requested by
the Administrative Agent, with respect to any portion of the Collateral,
without the prior express written consent of the Administrative Agent in each
instance, provided the Senior Secured Notes 

 

11

 

Obligations and Bank Obligations are treated similarly
in connection with any such motion, (iv) object to any sale of all or any
portion of the Collateral consented to by the Administrative Agent, or file any
pleading with respect to the sale of all or any portion of the Collateral,
without the prior express written consent of the Administrative Agent in each
instance, provided the Senior Secured Notes Obligations and Bank
Obligations are treated similarly in connection with any such sale, or (v) appear
and be heard on any matter in such case in a manner inconsistent with the terms
and provisions of this Agreement.

 

(e)           Unless
and until all Bank Obligations have been Fully Paid, the Administrative Agent
and the Lenders shall have the sole and exclusive right, subject to the rights
of the Borrower under the Loan Documents, to adjust settlement for any
insurance policy governing the Collateral in the event of any loss thereunder
and to approve any award granted in any condemnation or similar proceeding
affecting the Collateral.

 

Section 8.              [Reserved].

 

Section 9.              [Reserved].

 

Section 10.            Disclaimers, Etc.

 

(a)           Each
party executing this Agreement agrees, for itself and on behalf of the relevant
Secured Creditors, that (i) the Bank and Note Collateral Agent shall have
the right to act in the manner that the Instructing Group may direct
(regardless of whether any Secured Creditor or any holder represented thereby
agrees, disagrees or abstains with respect to such direction), (ii) the
Bank and Note Collateral Agent shall have no liability for acting in accordance
with such direction (provided such action does not, on its face,
conflict with the express terms of this Agreement) and (iii) no Secured
Creditor or any holder represented thereby shall have any liability to any
other Secured Creditor or any holder represented thereby for any such
direction.

 

(b)           For
the avoidance of doubt, Bank and Note Collateral Agent may at any time request
directions from the Instructing Group as to any course of action or other
matter relating hereto or as to any Security Document.  Except as otherwise expressly specified in
this Agreement, any such directions given by the Instructing Group shall be
binding on the Secured Creditors for all purposes as described in this
Agreement.

 

(c)           The
provisions of Article XI of the Security Agreement are incorporated herein
by reference thereto.

 

(d)           Notwithstanding
the use of the term “Agent” herein and/or in any Loan Document, it is expressly
understood and agreed that no Collateral Agent shall have any fiduciary
responsibilities to any Secured Creditor by reason of this Agreement, the
Security Agreement or any Loan Document and that each Collateral Agent is
merely acting as the contractual representative of the applicable Secured
Creditors with only those duties as are expressly set forth in this Agreement
and the Security Agreement and Mortgages, as the case may be.  In its capacity as the Secured Creditors’
contractual representative, no Collateral Agent assumes any fiduciary duties to
any of the Secured Creditors and each is acting as an independent contractor,
the rights and duties of which are limited to those expressly set forth in this
Agreement and the Security Agreement and Mortgages, as the case may be.  Each party

 

12

 

hereto, for itself and on behalf of the relevant
Secured Creditors hereby agrees not to assert a claim against a Collateral
Agent on any agency theory or any other theory of liability for breach of
fiduciary duty, all of which claims each party hereto, on behalf of each
Secured Creditor, hereby waives.  In
addition, no Collateral Agent shall have any implied duties to any Secured Creditor
or any obligation to any Secured Creditor to take any action hereunder or under
the Security Agreement or Mortgage, except any action specifically provided
herein or therein to be taken by such Collateral Agent.

 

Section 11.            Notices of Default and of Payment
in Full of Indebtedness.  Each party hereto agrees to use reasonable
efforts to give to the others
copies of any written notices of default, termination, demand for payment,
redemption, acceleration, foreclosure, exercise of remedies and any other
written notice of a like nature, which may be given under or pursuant to the
terms of any of the applicable Loan Documents or the Senior Secured Notes
Indenture and of any notice contemplated under the definition of the term “Fully
Paid” herein, in each case concurrently with, or as soon as practicable after,
the giving of such notice to such party; provided, however, that
no failure of any party to give a copy of any such notice as provided herein
shall in any event affect the validity or effectiveness of the notice or render
the party liable to any other party in any respect or relieve any party of its
obligations and agreements contained herein; provided, further, however,
that in no event shall this Section 11 require the delivery of any
notices to Borrower.

 

Section 12.            Notices.  All notices
and communications hereunder shall be sent or delivered by mail, telecopier or
overnight courier service and all such notices and communications shall (i) in
the case of a notice or communication sent by mail, be effective three Business
Days following deposit with proper prepaid postage in the mail; (ii) in
the case of a notice or communication sent by telecopier, be effective when
sent, provided appropriate confirmation is received by the sender; and (iii) in
the case of a notice or communication sent by overnight courier, be effective
on the date of delivery.  All notices,
requests, demands or other communications shall be in writing and addressed as
follows:

 

(i)          If
to the Bank and Note Collateral Agent, Mortgagee or Administrative Agent:

 

Deutsche
Bank AG New York Branch

60 Wall Street, 2nd Floor

NYC60 - 0219

New York, New York 10005

Attention:  Chris Towery

Telephone No.:  (212) 250-0839

Telecopier No.:  (212) 797-0070

 

13

 

with a
copy to:

 

Winston &
Strawn LLP

35 West Wacker Drive

Chicago, Illinois 60601

Attention:  Charles B. Boehrer

Telephone Number:  (312) 558-5600

Telecopier Number:  (312) 558-5700

 

(ii)           If
to the Senior Secured Notes Trustee:

 

HSBC
Bank USA, National Association

452
Fifth Avenue

Corporate
Trust

New
York, New York  10018

Attention:  Gloria Alli

Telephone:  (212) 525-1404

Telecopier No.:  (212) 525-1300

 

with a
copy to:

 

Pryor
Cashman Sherman & Flynn LLP 

410 Park Avenue 

New York, New York 10022

Attention:  Ronald T. Sarubbi
Telephone No.:  (212) 326-0490

Telecopier No.:  (212) 798-6307

 

or at such other address
or to any such successor or assign as any party may designate by notice to the
other party in accordance with the provisions hereof.  In the event that any Secured Creditor shall
be required by the Uniform Commercial Code or any other applicable law to give
notice to the Borrower or any other Secured Creditor of the intended
disposition of any Collateral, such notice shall be given as provided in the
Security Agreement and ten days notice shall be deemed to be commercially
reasonable.  Each Secured Creditor,
including the Senior Secured Notes Trustee, hereby appoints the Bank and Note
Collateral Agent as its agent and representative for purposes of giving and
receiving notices under the Security Documents.

 

(a)           Upon
written request from the Bank and Note Collateral Agent, the Senior Secured
Notes Trustee agrees to promptly notify the Bank and Note Collateral Agent of (i) the
aggregate amount of principal and interest outstanding and other amounts owing
with respect to the Senior Secured Notes and the amount, if any, then due and
payable under the Senior Secured Notes Indenture, as at such date as the Bank
and Note Collateral Agent may specify and (ii) any payment received by the
Senior Secured Notes Trustee to be applied to the principal of or interest on
the amounts due with respect to the Senior Secured Notes.

 

Section 13.            GOVERNING LAW.  THIS
AGREEMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF
NEW YORK, 

 

14

 

AND FOR ALL PURPOSES SHALL BE
CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS AND DECISIONS OF SAID STATE.

 

Section 14.            CONSENT TO JURISDICTION.  THE
PARTIES HERETO HEREBY CONSENT TO THE JURISDICTION OF ANY STATE OR FEDERAL COURT
LOCATED WITHIN THE CITY OF NEW YORK, STATE OF NEW YORK AND IRREVOCABLY AGREE
THAT ALL ACTIONS OR PROCEEDINGS RELATING TO THIS AGREEMENT SHALL BE LITIGATED
IN SUCH COURTS.  EACH PARTY HERETO
ACCEPTS FOR AND IN CONNECTION WITH ITS PROPERTIES, GENERALLY AND
UNCONDITIONALLY, IN ANY SUCH ACTIONS OR PROCEEDINGS, THE EXCLUSIVE JURISDICTION
OF THE AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON CONVENIENS, AND
IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION
WITH THIS AGREEMENT, AND WITH ANY JUDGMENT SUBJECT TO RIGHTS OF APPEAL IN THE
JURISDICTIONS SET FORTH ABOVE.

 

Section 15.            WAIVER OF JURY TRIAL.  THE
PARTIES HERETO HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY
CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT, OR ANY
DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS AGREEMENT.  THE PARTIES HERETO ALSO WAIVE ANY BOND OR
SURETY OR SECURITY UPON SUCH BOND THAT MIGHT, BUT FOR THIS WAIVER, BE REQUIRED
OF THE PARTIES HERETO.  THE SCOPE OF THIS
WAIVER IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE
FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS AGREEMENT,
INCLUDING, WITHOUT LIMITATION, CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY
CLAIMS, AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS.  THE PARTIES HERETO EACH ACKNOWLEDGE THAT THIS
WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT
EACH HAS ALREADY RELIED ON THE WAIVER IN ENTERING INTO THIS AGREEMENT AND THAT
EACH WILL CONTINUE TO RELY ON THE WAIVER IN THEIR RELATED FUTURE DEALINGS.  THE PARTIES HERETO FURTHER WARRANT AND
REPRESENT THAT EACH HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL, AND THAT
EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING
CONSULTATION WITH LEGAL COUNSEL.  THIS
WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY
OR IN WRITING, AND THE WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT.  IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE
FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.

 

Section 16.            Section Titles.  The section titles
contained in this Agreement are and shall be without substantive meaning or
content of any kind whatsoever and are not a part of the Agreement between the
parties hereto.

 

Section 17.            Counterparts.  This
Agreement and any amendments, waivers, consents or supplements may be executed
in any number of counterparts and by different parties

 

15

 

hereto in separate counterparts,
each of which when so executed and delivered shall be deemed an original, but
all of which counterparts together shall constitute but one and the same
instrument.

 

Section 18.            Severability.  The
invalidity, illegality or unenforceability of any provision in or obligation
under this Agreement shall not affect or impair the validity, legality or
enforceability of the remaining provisions or obligations under this Agreement.

 

Section 19.            Assignment.  This
Agreement shall be binding upon, and inure to the benefit of, the Secured
Creditors and their respective successors and assigns regardless of whether
such successors or assigns are signatories hereto.  The term “Borrower” as used herein shall also
refer to the permitted successors and assigns of the Borrower, including,
without limitation, a receiver, trustee, custodian or
debtor-in-possession.  The Secured
Creditors shall have the right to assign, transfer or grant participations in
part or all of the senior debt owed to them, the security therefor and their
rights hereunder.  This Agreement shall
be binding upon and enure to the benefit of the Secured Creditors and their
successors and assigns.

 

Section 20.            Conflict with Other Agreements.  The parties
hereto agree that in the event of any conflict between the provisions of this
Agreement and the provisions of any Loan Document, the provisions of this
Agreement shall control.

 

Section 21.            Amendments and Waivers.  This
Agreement constitutes the entire agreement of the parties hereto with respect
to the subject matter hereof and does not affect any rights and remedies except
as expressly provided herein. This Agreement shall be amended, modified or
waived only with the written consent of the Bank and Note Collateral Agent
(with such written requisite consent of the Lenders as may be required pursuant
to Section 12.1 of the Credit Agreement), except that (i) written
consent of the Senior Secured Notes Trustee shall be required if the amendment,
modification or waiver or variance would materially adversely affect the rights
and benefits of the Senior Secured Notes Trustee or the Senior Secured
Noteholders in a different manner from the other Secured Creditors; and (ii) written
consent of the Borrower shall be required if the amendment, modification or
waiver would impose, or have the effect of imposing, on the Borrower more
restrictive covenants or greater obligations than those applicable to the
Borrower under this Agreement or any of the Loan Documents as of the date
hereof.  No waiver shall be deemed to be
made by either Collateral Agent of their respective rights hereunder, unless
the same shall be in writing signed by such Collateral Agent (acting in
accordance with this Section 21), and each waiver, if any, shall be
a waiver only with respect to the specific instance involved and shall in no
way impair the rights of such Collateral Agent, in any other respect at any
other time.

 

Section 22.            Miscellaneous.  This
Agreement is solely for the purpose of defining the relative rights and
priorities of the parties hereto and that of the Secured Creditors and their
respective successors and assigns with respect to the Collateral, and no other
Person shall have any right, benefit, priority or interest under, or because of
the existence of, this Agreement.  It is
expressly acknowledged and agreed that the Bank and Note Collateral Agent may
be referred to in one or more Security Documents by other defined terms,
including, without limitation, the “Collateral Agent” or “Security Trustee”.  No such use of such different terminology is
intended to affect the enforcement of this Agreement or any other Security

 

16

 

Document.  This Agreement shall not inure to the benefit
of the Borrower nor to any Subsidiary of the Borrower, nor to their respective
successors and assigns.  The parties
hereto agree and acknowledge that they shall not challenge or question in any
proceeding the validity, perfection, priority or enforceability of this
Agreement, as a whole, or any term or provision contained herein.  Without limiting the terms of this Agreement,
the parties intend that this Agreement shall be enforceable in a bankruptcy
proceeding, including pursuant to Section 510(a) of the Bankruptcy
Code.

 

Section 23.            Termination. 
Upon the one hundred
twenty-first (121st) day after all
Bank Obligations have been Fully Paid, this Agreement shall immediately
terminate and cease to be effective and the Administrative Agent, the Lenders,
the Senior Secured Noteholders, the Senior Secured Notes Trustee, and the
Credit Parties shall be released from their respective obligations hereunder
(other than such obligations that by their terms are stated to survive the
termination of this Agreement); provided, however, (a) this
Agreement shall be automatically reinstated if at any time payment of, in whole
or in part, any of the Bank Obligations are challenged by the initiation of any
suit or proceeding by any party, or are rescinded or must otherwise be restored
or returned by the Administrative Agent or any Lender as a preference,
fraudulent conveyance or otherwise under any bankruptcy, insolvency or similar
law, or under any other state or federal law, the common law or any ruling in
equity, all as though such payment had not been made, and in such event, all
reasonable documented costs and expenses (including, without limitation, any
reasonable documented legal fees and disbursements) incurred by the
Administrative Agent or any Lender in defending any such action or proceeding
or enforcing such reinstatement shall be deemed included as part of the Bank
Obligations, and the Administrative Agent, each Lender, the Senior Secured
Notes Trustee and the Senior Secured Noteholders shall each account for any
payments received in respect of the Collateral prior to such reinstatement and (b) immediately
after all Bank Obligations have been Fully Paid, the terms of this Agreement
shall no longer be applicable to restrict any action or failure to act by the
Senior Secured Notes Trustee and the Senior Secured Noteholders with respect to
the Collateral subject to the immediately preceding clause (a).

 

Section 24.            Effect of this Agreement.  Each party hereto hereby acknowledges
that this Agreement replaces in its entirety the Prior Intercreditor Agreement.

 

 

[signature pages follow]

 

17

 

IN WITNESS WHEREOF, the
parties hereto have caused this Agreement to be duly executed and delivered by
their duly authorized representatives as of the day and year first above
written.

 

	
   

  	
  DEUTSCHE BANK AG NEW YORK BRANCH,

  
	
   

  	
    as Administrative Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Marguerite Sutton

  	
   

  
	
   

  	
   

  
	
   

  	
  Name: Marguerite Sutton

  
	
   

  	
   

  
	
   

  	
  Title: Director

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  DEUTSCHE BANK AG NEW YORK BRANCH, 

    as Bank and Note Collateral Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Marguerite Sutton

  	
   

  
	
   

  	
   

  
	
   

  	
  Name: Marguerite Sutton

  
	
   

  	
   

  
	
   

  	
  Title: Director

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  DEUTSCHE BANK AG NEW YORK BRANCH,

     as Mortgagee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Marguerite Sutton

  	
   

  
	
   

  	
   

  
	
   

  	
  Name: Marguerite Sutton

  
	
   

  	
   

  
	
   

  	
  Title: Director

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  HSBC BANK USA, NATIONAL ASSOCIATION,

    as Senior Secured Notes Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Frank J. Godino

  	
   

  
	
   

  	
   

  
	
   

  	
  Name: Frank J. Godino

  
	
   

  	
   

  
	
   

  	
  Title: Vice President

  
					

 

A-1

 

	
  Acknowledged and
  Agreed:

  	
   

  
	
   

  	
   

  
	
  HUNTSMAN INTERNATIONAL
  LLC

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Sean Douglas

  	
   

  	
   

  
	
   

  	
   

  
	
  Name: Sean
  Douglas

  	
   

  
	
   

  	
   

  
	
  Title: Vice
  President and Treasurer

  	
   

  
				

 

2Exhibit 10.3

 

 

COLLATERAL
SECURITY AGREEMENT

 

dated as of
August 16, 2005

 

 

by and
among

 

HUNTSMAN
INTERNATIONAL LLC,

 

CERTAIN
SUBSIDIARIES OF HUNTSMAN INTERNATIONAL LLC

 

FROM TIME
TO TIME PARTY HERETO

 

and

 

DEUTSCHE
BANK AG NEW YORK BRANCH,

AS
COLLATERAL AGENT

 

 

TABLE OF
CONTENTS

 

	
  ARTICLE I

  	
   

  
	
   

  	
  SECURITY INTERESTS

  	
   

  
	
   

  	
   

  	
   

  
	
  1.1

  	
  Grant of Security Interests

  	
   

  
	
  1.2

  	
  Delivery of Pledged Stock and Pledged Intercompany Notes

  	
   

  
	
  1.3

  	
  Continued Performance by Assignor

  	
   

  
	
  1.4

  	
  Power of Attorney

  	
   

  
	
  1.5

  	
  Intercreditor Agreement

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE II

  	
   

  
	
   

  	
  GENERAL REPRESENTATIONS, WARRANTIES AND COVENANTS

  	
   

  
	
   

  	
   

  	
   

  
	
  2.1

  	
  General Representations, Warranties and Covenants

  	
   

  
	
  2.2

  	
  Reliance

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE III

  	
   

  
	
   

  	
  SPECIAL PROVISIONS CONCERNING RECEIVABLES;
  CONTRACT RIGHTS; INSTRUMENTS

  	
   

  
	
   

  	
   

  	
   

  
	
  3.1

  	
  Additional Representations and Warranties

  	
   

  
	
  3.2

  	
  Maintenance of Records

  	
   

  
	
  3.3

  	
  Instruments

  	
   

  
	
  3.4

  	
  Direction to Account Debtors; Contracting Parties, etc.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV

  	
   

  
	
   

  	
  SPECIAL PROVISIONS CONCERNING MARKS

  	
   

  
	
   

  	
   

  	
   

  
	
  4.1

  	
  Additional Representations and Warranties

  	
   

  
	
  4.2

  	
  Divestitures

  	
   

  
	
  4.3

  	
  Infringements

  	
   

  
	
  4.4

  	
  Preservation of Marks

  	
   

  
	
  4.5

  	
  Maintenance of Registration

  	
   

  
	
  4.6

  	
  Future Registered Marks

  	
   

  
	
  4.7

  	
  Remedies

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE V

  	
   

  
	
   

  	
  SPECIAL PROVISIONS CONCERNING PATENTS, COPYRIGHTS
  AND TRADE SECRETS

  	
   

  
	
   

  	
   

  	
   

  
	
  5.1

  	
  Additional Representations and Warranties

  	
   

  
	
  5.2

  	
  Infringements

  	
   

  
	
  5.3

  	
  Preservation of Patents

  	
   

  
	
  5.4

  	
  Prosecution of Patent Applications

  	
   

  
	
  5.5

  	
  Other Patents and Copyrights

  	
   

  
	
  5.6

  	
  Remedies

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI

  	
   

  
	
   

  	
  PROVISIONS CONCERNING PLEDGED SECURITIES

  	
   

  

 

i

 

	
  6.1

  	
  Pledge of Notes and Additional Stock

  	
   

  
	
  6.2

  	
  Capital Stock

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII

  	
   

  
	
   

  	
  PROVISIONS CONCERNING ALL COLLATERAL

  	
   

  
	
   

  	
   

  	
   

  
	
  7.1

  	
  Protection of Collateral Agent’s Security

  	
   

  
	
  7.2

  	
  Warehouse Receipts Non-negotiable

  	
   

  
	
  7.3

  	
  Right to Initiate Judicial Proceedings, etc.

  	
   

  
	
  7.4

  	
  Appointment of a Receiver

  	
   

  
	
  7.5

  	
  Further Actions

  	
   

  
	
  7.6

  	
  Financing Statements

  	
   

  
	
  7.7

  	
  Control

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VIII

  	
   

  
	
   

  	
  REMEDIES UPON OCCURRENCE OF EVENT OF DEFAULT

  	
   

  
	
   

  	
   

  	
   

  
	
  8.1

  	
  Default

  	
   

  
	
  8.2

  	
  Remedies; Obtaining the Collateral Upon Default

  	
   

  
	
  8.3

  	
  Remedies; Disposition of the Collateral

  	
   

  
	
  8.4

  	
  Waiver of Claims

  	
   

  
	
  8.5

  	
  Application of Proceeds

  	
   

  
	
  8.6

  	
  Remedies Cumulative

  	
   

  
	
  8.7

  	
  Discontinuance of Proceedings

  	
   

  
	
  8.8

  	
  Collateral Agent’s Calculations

  	
   

  
	
  8.9

  	
  Adjustments

  	
   

  
	
  8.10

  	
  Sharing Arrangements

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE IX

  	
   

  
	
   

  	
  INDEMNITY

  	
   

  
	
   

  	
   

  	
   

  
	
  9.1

  	
  Indemnity

  	
   

  
	
  9.2

  	
  Indemnity Obligations Secured by Collateral; Survival

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE X

  	
   

  
	
   

  	
  OTHER AGREEMENTS WITH COLLATERAL AGENT

  	
   

  
	
   

  	
   

  	
   

  
	
  10.1

  	
  Compensation and Expenses

  	
   

  
	
  10.2

  	
  Stamp and Other Taxes

  	
   

  
	
  10.3

  	
  Filing Fees, Excise Taxes, Etc.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE XI

  	
   

  
	
   

  	
  THE COLLATERAL AGENT

  	
   

  
	
   

  	
   

  	
   

  
	
  11.1

  	
  Appointment of the Collateral Agent

  	
   

  
	
  11.2

  	
  Acceptance of Appointment

  	
   

  
	
  11.3

  	
  Further Assurances

  	
   

  
	
  11.4

  	
  Exculpatory Provisions

  	
   

  
	
  11.5

  	
  Delegation of Duties

  	
   

  
	
  11.6

  	
  Reliance by Collateral Agent

  	
   

  
	
  11.7

  	
  Limitations on Duties of the Collateral Agent

  	
   

  
	
  11.8

  	
  Assets to Be Held in Trust

  	
   

  

 

ii

 

	
  11.9

  	
  Resignation and Removal of the Collateral Agent

  	
   

  
	
  11.10

  	
  Status of Successors to the Collateral Agent

  	
   

  
	
  11.11

  	
  Merger of the Collateral Agent

  	
   

  
	
  11.12

  	
  Additional Co-Agents; Separate Agents

  	
   

  
	
  11.13

  	
  Collateral Agent as UK Security Trustee

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE XII

  	
   

  
	
   

  	
  TERMINATION; RELEASES OF COLLATERAL

  	
   

  
	
   

  	
   

  	
   

  
	
  12.1

  	
  Release of Certain Security

  	
   

  
	
  12.2

  	
  Termination Upon Satisfaction

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE XIII

  	
   

  
	
   

  	
  LIMITED RIGHTS OF SECURED PARTIES; PROOFS OF CLAIM

  	
   

  
	
   

  	
   

  	
   

  
	
  13.1

  	
  Limited Rights of Secured Parties

  	
   

  
	
  13.2

  	
  Filing of Claims

  	
   

  
	
  13.3

  	
  Collection of Claims

  	
   

  
	
  13.4

  	
  Limitations

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE XIV

  	
   

  
	
   

  	
  MISCELLANEOUS

  	
   

  
	
   

  	
   

  	
   

  
	
  14.1

  	
  Notices

  	
   

  
	
  14.2

  	
  Waiver; Amendment

  	
   

  
	
  14.3

  	
  Obligations Absolute

  	
   

  
	
  14.4

  	
  Successors and Assigns

  	
   

  
	
  14.5

  	
  Headings Descriptive

  	
   

  
	
  14.6

  	
  Severability

  	
   

  
	
  14.7

  	
  Conflict With Other Agreements

  	
   

  
	
  14.8

  	
  Governing Law

  	
   

  
	
  14.9

  	
  Consent to Jurisdiction and Service of Process; Waiver of Jury Trial

  	
   

  
	
  14.10

  	
  Assignor’s Duties

  	
   

  
	
  14.11

  	
  Counterparts

  	
   

  
	
  14.12

  	
  No Action by Secured Parties

  	
   

  
	
  14.13

  	
  Definitions; Interpretation

  	
   

  
	
  14.14

  	
  Conflicts with the Credit Agreement

  	
   

  
	
  14.15

  	
  References to this Agreement in Other Documents

  	
   

  
	
   

  	
   

  	
   

  
	
  PLEDGED INTERCOMPANY NOTES

  	
   

  
	
   

  	
   

  	
   

  
	
  INTERCREDITOR AGREEMENT

  	
   

  

 

iii

 

	
  ANNEXES

  	
   

  
	
   

  	
   

  
	
  ANNEX A

  	
  -

  	
  Definitions

  	
   

  
	
  ANNEX B

  	
  -

  	
  Trademarks and Patents

  	
   

  
	
  ANNEX C

  	
  -

  	
  Copyrights

  	
   

  
	
   

  	
   

  
	
  SCHEDULES

  	
   

  
	
   

  	
   

  
	
  SCHEDULE A

  	
  -

  	
  Existing Hedging Agreements

  	
   

  
	
  SCHEDULE B

  	
  -

  	
  Intercompany Notes

  	
   

  
	
  SCHEDULE C

  	
  -

  	
  Capital Stock

  	
   

  
	
  SCHEDULE 2.1(f)

  	
  -

  	
  Chief Executive Office

  	
   

  
	
  SCHEDULE 2.1(g)

  	
  -

  	
  Location of Inventory and Equipment

  	
   

  
	
  SCHEDULE 2.1(h)

  	
  -

  	
  Aircraft, Vehicles, Vessels, Barges, Railcars and Rolling Stock

  	
   

  
	
  SCHEDULE 2.1(i)

  	
  -

  	
  Trade and Fictitious Names

  	
   

  
	
  SCHEDULE 2.1(j)

  	
  -

  	
  State of Incorporation

  	
   

  
	
  SCHEDULE 2.1(k)

  	
  -

  	
  Commercial Tort Claims

  	
   

  
	
  SCHEDULE 4.1

  	
  -

  	
  Marks

  	
   

  
	
  SCHEDULE 5.1(A)

  	
  -

  	
  Patents

  	
   

  
	
  SCHEDULE 5.1(B)

  	
  -

  	
  Copyrights

  	
   

  
	
   

  	
   

  
	
  EXHIBITS

  	
   

  
	
   

  	
   

  
	
  EXHIBIT A

  	
  -

  	
  Form of Supplement to Security Agreement

  	
   

  
	
  EXHIBIT B

  	
  -

  	
  Intercreditor Agreement

  	
   

  
						

 

iv

 

COLLATERAL
SECURITY AGREEMENT

 

COLLATERAL SECURITY AGREEMENT (as amended, restated, supplemented,
replaced or otherwise modified from time to time, this “Agreement”),
dated as of August 16, 2005, is by and among each of the undersigned
(each, an “Assignor” and, together with any other entity that becomes a
party hereto pursuant to Section 14.2(d) hereof, collectively,
the “Assignors”) and DEUTSCHE BANK AG NEW YORK BRANCH, as Collateral
Agent for the benefit of (i) the Lenders and the Administrative Agent
under the Credit Agreement hereinafter referred to; (ii) the Senior
Secured Notes Trustee, for the benefit of itself and the holders of the Senior
Secured Notes; (iii) if one or more Lenders (or any Affiliate thereof) has
heretofore entered into or hereafter enters into one or more Interest Rate
Agreements or Other Hedging Agreements permitted pursuant to Section 8.2(e) of
the Credit Agreement with, or guaranteed by, the Borrower or any of its
Subsidiaries, any such Lender or Lenders or any Affiliate of such Lender or
Lenders (even if the respective Lender subsequently ceases to be a Lender under
the Credit Agreement for any reason) so long as any such Lender or Affiliate
participates in the extension of such Interest Rate Agreements or Other Hedging
Agreements and their subsequent assigns, if any (collectively, the “Secured
Hedging Agreements”); and (iv) one or more financial institutions from
time to time party to Overdraft Facilities Agreements with, or guaranteed by,
the Borrower or any of its Subsidiaries (collectively the “Secured Parties”
or the “Secured Party”).  The
meaning of capitalized terms used herein shall be determined in accordance with
Section 14.13 hereof.

 

W I  T  N  E
S  S  E  T  H:

 

WHEREAS, Huntsman International LLC, a Delaware
limited liability company (the “Borrower” or the “Company”), the
financial institutions (the “Lenders”) from time to time party thereto,
Deutsche Bank AG New York Branch, as administrative agent (together with any
successor agent, the “Administrative Agent”), Deutsche Bank Securities
Inc., as joint lead arranger and joint book runner, Citigroup Global Markets
Inc., as co-syndication agent, joint lead arranger and joint book runner and
Credit Suisse, as co-syndication agent and joint book runner, are
contemporaneously herewith entering into a Credit Agreement dated as of the
date hereof (the “Credit Agreement”, as the same may hereafter be
amended, modified, extended, renewed, replaced, restated, waived or
supplemented from time to time, and including any agreement extending the
maturity of or restructuring of all or any portion of the Indebtedness under
such agreement or any successor agreements);

 

WHEREAS, Huntsman LLC, a Utah limited liability
company, (“HLLC”) has issued $455.4 million in aggregate principal
amount of Senior Secured Notes due 2010 (together with any additional notes
issued under the Senior Secured Notes Indenture (as hereinafter defined) which
are permitted to be issued under the Credit Agreement, the “Senior Secured
Notes”) under an Indenture, dated as of September 30, 2003, among
Borrower, the Assignors parties thereto as guarantors, and HSBC Bank USA, as
trustee thereunder (such trustee and any successor trustee thereunder, the “Senior
Secured Notes Trustee”, and such indenture, as amended, restated,
supplemented, refinanced, replaced or otherwise modified from time to time, the
“Senior Secured Notes Indenture”);

 

1

 

WHEREAS, the Assignors party to the Senior Secured
Notes Indenture have guaranteed the obligations of HLLC under the Senior
Secured Notes Indenture;

 

WHEREAS, the Borrower or any of its Subsidiaries may
have from time to time before the date hereof, entered into, or guaranteed, one
or more Interest Rate Agreements or Other Hedging Agreements each as described
on Schedule A hereto (collectively, the “Existing Hedging
Agreements”);

 

WHEREAS, on the Closing Date, HLLC will merge with
and into the Borrower, with the Borrower as the surviving entity;

 

WHEREAS, the Borrower or any of its Subsidiaries may
at any time and from time to time enter into, or guarantee, one or more
Interest Rate Agreements or Other Hedging Agreements;

 

WHEREAS, the Borrower or any of its Subsidiaries may
at any time and from time to time enter into, or guarantee, one or more loan
agreements evidencing the Overdraft Facilities (the “Overdraft Facilities
Agreements”);

 

WHEREAS, pursuant to the Subsidiary Guaranty, each
Assignor (other than the Borrower) has jointly and severally guaranteed to the
Secured Parties (other than the Senior Secured Notes Trustee and the holders of
the Senior Secured Notes) the payment when due of all obligations of Borrower
and the other Assignors under or with respect to the Loan Documents, the
Secured Hedging Agreements and the Overdraft Facilities Agreements; 

 

WHEREAS, Huntsman Headquarters Corporation has
guaranteed to the Secured Parties (other than the Senior Secured Notes Trustee
and the holders of the Senior Secured Notes) the payment when due of all
obligations of Borrower and the other Assignors under or with respect to the
Loan Documents, the Secured Hedging Agreements and the Overdraft Facilities
Agreements; and

 

WHEREAS, each Assignor desires to execute this
Agreement in order to satisfy the conditions under the Credit Agreement and the
Senior Secured Notes Indenture.

 

NOW, THEREFORE, in consideration of the extensions
of credit to be made to each Assignor and other benefits accruing to each
Assignor, the receipt and sufficiency of which are hereby acknowledged, each
Assignor hereby covenants and agrees with the Collateral Agent for the benefit
of the Secured Parties as follows:

 

ARTICLE I

 

SECURITY
INTERESTS

 

1.1          Grant of Security Interests.  (a) As
collateral security for the prompt and complete payment and performance of the
Secured Obligations when due, and to induce the Administrative Agent and the
Lenders to enter into the Credit Agreement and to make the Loans and provide
the other financial accommodations to Borrower contemplated therein, each such
Assignor does hereby grant, pledge, assign and transfer unto the Collateral
Agent, in its capacity

 

2

 

as Collateral Agent
hereunder for the benefit of the Secured Parties, a continuing security
interest of first priority in all of the right, title and interest of such
Assignor in, to and under all of the following, whether now existing or
hereafter from time to time arising, and whether now owned or hereafter from
time to time acquired or created:  (i) all
cash, accounts, deposits, Deposit Accounts, Investment Property, securities
accounts, securities and insurance policies now or at any time hereafter in the
possession or under control of such Assignor or its respective bailees and any
interest therein, (ii) each and every Receivable, (iii) all
Contracts, together with all Contract Rights arising thereunder, and all equity
and debt securities and other interests in any and all Unrestricted
Subsidiaries, (iv) all Inventory, (v) any cash collateral account
established with respect to such Assignor and all monies, securities and
instruments deposited or required to be deposited in such cash collateral
account, (vi) all Equipment, (vii) all Marks, together with the
registrations and right to all renewals thereof, and the goodwill of the
business of such Assignor symbolized by the Marks and all Intellectual Property
Causes of Action, (viii) all Patents and Copyrights, and all reissues,
renewals or extensions thereof, (ix) all computer programs and all
intellectual property rights therein and all other proprietary information,
including, but not limited to, Trade Secrets, (x) all vehicles, aircraft,
vessels, barges, railcars, rolling stock and Fixtures, together with accessions
thereto and replacement parts therefor, (xi) (A) all Intercompany Notes
described in Schedule B (as it may, from time to time, be
supplemented in accordance with the terms hereof), all other Intercompany Notes
and all other promissory notes owing to such Assignor; (B) (1) all
Capital Stock described in Schedule C (as it may, from time to
time, be supplemented in accordance with the terms hereof) and (2) all
other Capital Stock; and (C) all Stock Rights, (xii) all books and
records, customer lists, ledger cards, credit files, print-outs, and other
materials and records pertaining to any of the foregoing, whether now owned or
hereafter acquired, (xiii) all other Goods, General Intangibles, Chattel Paper,
Documents and Instruments, (xiv) all Letter-of-Credit Rights, (xv) any
Commercial Tort Claims described on Schedule 2.1(k), (xvi) all
other personal property of such Assignor, whether now owned or hereafter
acquired, (xvii) all documents of title evidencing or issued with respect to
any of the foregoing, and (xviii) all Proceeds and products of any and all of
the foregoing (including, without limitation, all insurance and claims for
insurance effected or held for the benefit of such Assignor in respect thereof)
(all of the above, as limited below in Sections 1.1(c) and 1.1(d),
collectively, the “Collateral”); provided, however, that
the security interests granted hereunder shall only cover any Assignor’s right,
title and interest in any asset subject to liens described in clause (2) of
Section 8.1(h) of the Credit Agreement, to the extent that the Lender
(as defined in that certain Loan Agreement by and among Huntsman Headquarters
Corporation, Huntsman Petrochemical Corporation, Huntsman Chemical Corporation,
Huntsman Packaging Corporation and U.S. Bank of Utah dated as of December 17,
1996 (the “Headquarters Loan Agreement”) has consented to the grant by
Huntsman Headquarters Corporation of a security interest in any Collateral (as
defined in the Headquarters Loan Agreement) hereunder.

 

(b)           The security interests of the Collateral
Agent under this Agreement extend to all Collateral of the kind which is the
subject of this Agreement (but subject to the limitations contained in this
Agreement) which the Assignor may acquire at any time during the continuation
of this Agreement.

 

(c)           The Collateral shall not include any
property or assets (whether tangible or intangible, including without
limitation, Capital Stock) or any right, title or interest in respect thereof (i) which
constitutes the Capital Stock (as defined in the Senior Secured Notes
Indenture)

 

3

 

of Subsidiaries (as
defined in the Senior Secured Notes Indenture) of the Borrower or of any
Guarantor (as defined in the Senior Secured Notes Indenture), or any Stock
Rights or Proceeds thereof in any such Capital Stock, (ii) which is
subject to an agreement that expressly prohibits the assignment thereof, or the
creation of a security interest therein (including, without limitation,
Receivables (and Deposit Accounts holding proceeds of those Receivables)
subject to a Permitted Accounts Receivables Securitization), (iii) to the
extent that any law or regulation applicable to such rights or property
prohibits the assignment thereof or the creation of a security interest therein
and (iv) to the extent that such collateral is not required to be pledged
under Section 7.11(a), (c) or (d) of the Credit Agreement;
provided, however, that such rights and property described in the preceding
clauses (ii) and (iii) shall be excluded from the Collateral only to
the extent and for so long as such agreement (in the case of clause (ii)) or
such law (in the case of clause (iii)) continues to expressly prohibit the
creation of such security interest, and upon the expiration of such
prohibition, the rights and property as to which such prohibition previously
applied shall automatically be included in the Collateral, without further
action on the part of the Assignor or the Collateral Agent; provided,
further, that the Capital Stock of LPC pledged by TAI shall constitute
Collateral, except that the exercise of any rights or remedies with respect to
the Capital Stock of LPC shall be subject to the transfer restrictions set
forth in the Joint Venture Agreement dated as of October 18, 1993 between
TAI and Kronos Louisiana, Inc.

 

(d)           Notwithstanding Sections 1.1(a) and
(b), for the avoidance of doubt, Collateral shall not include Capital
Stock and equity interests, or portion thereof, of Persons organized outside
the United States which would otherwise be required to be pledged to the
Collateral Agent pursuant to the terms hereof (“Foreign Equity Interests”)
but which are pledged pursuant to collateral documents (“Foreign Pledge
Documents”) governed by the laws of a jurisdiction other than any State or
Federal laws of the United States of America.

 

1.2          Delivery of Pledged Stock and Pledged
Intercompany Notes.  The Pledged Intercompany Notes
listed on Schedule B and the certificates representing the Pledged
Stock listed on Schedule C (other than the shares of capital stock
of foreign entities which are not certificated) shall be delivered to the
Collateral Agent contemporaneously herewith together with appropriate undated
note powers and stock powers duly executed in blank.  Neither the Collateral Agent nor any Secured
Party shall be obligated to preserve or protect any rights with respect to the
Pledged Intercompany Notes or the Pledged Stock or to receive or give any
notice with respect thereto whether or not the Collateral Agent or any Secured
Party is deemed to have knowledge of such matters.  The Collateral Agent agrees to hold such
Pledged Stock, the Pledged Intercompany Notes and any other Collateral in its
possession for the benefit of the Secured Parties.

 

1.3          Continued Performance by Assignor. 
The assignments and security interests under this Agreement granted to
the Collateral Agent shall not relieve any Assignor from the performance of any
term, covenant, condition or agreement on such Assignor’s part to be performed
or observed under or in respect of any of the Collateral pledged by it
hereunder or from any liability to any Person under or in respect of any of
such Collateral or impose any obligation on the Collateral Agent to perform or
observe any such term, covenant, condition or agreement on such Assignor’s part
to be so performed or observed or impose any liability on the Collateral Agent
for any act or omission on the part of such Assignor relative thereto or for
any breach of any representation or warranty on the part of such Assignor
contained in this

 

4

 

Agreement or any other
Loan Document, or in respect of the Collateral pledged by it hereunder or made
in connection herewith or therewith.  

 

1.4          Power of Attorney. 
By way of securing its obligations hereunder, each Assignor hereby
constitutes and appoints the Collateral Agent its true and lawful attorney,
irrevocably, with full power after the occurrence of and during the continuance
of an Event of Default (in the name of such Assignor or otherwise), in the
Collateral Agent’s discretion, to take any action and to execute any instrument
which the Collateral Agent may reasonably deem necessary or advisable to
accomplish the purposes of this Agreement, which appointment as attorney is
coupled with an interest.

 

1.5          Intercreditor Agreement. 
Each of the Secured Parties agrees that all the rights hereunder are
subject to the terms of the Intercreditor Agreement, a copy of which is
attached as Exhibit B hereto (as amended, modified, supplemented,
replaced or restated, the “Intercreditor Agreement”).

 

ARTICLE II

 

GENERAL
REPRESENTATIONS, WARRANTIES AND COVENANTS

 

2.1          General Representations, Warranties
and Covenants.  In addition to and not in limitation of the
representations and warranties of any Assignor set forth in any other Debt
Document to which such Assignor is a party, each Assignor represents, warrants
and covenants to the Collateral Agent, which representations, warranties and
covenants shall survive execution and delivery of this Agreement, as follows:

 

(a)           Incorporation of Credit
Agreement Representations.  The
representations and warranties set forth in Article VI of the Credit
Agreement as they relate to such Assignor or to the Loan Documents to which
such Assignor is party, each of which representations is incorporated herein by
reference, are true and correct in all material respects and the Collateral
Agent shall be entitled to rely on such representations and warranties as if
fully set forth herein. 

 

(b)           Title to Debt and Notes. 
Such Assignor is the direct and sole legal and equitable owner of any
and all Pledged Debt and Pledged Intercompany Notes indicated on Schedule B
as being owned by it.  Such Assignor has
the authority to pledge and deliver such Pledged Debt to the Collateral Agent
pursuant hereto.

 

(c)           Title to Pledged Stock. 
Such Assignor is the record and beneficial owner of each share of the
Pledged Stock indicated on Schedule C as being owned by it.  All of such shares of the Pledged Stock are
duly authorized, validly issued, fully paid and non-assessable (or, with
respect to foreign entities, to the extent such concepts are applicable under
the laws under which such entities are organized).  Such Assignor has all requisite rights,
power, and authority to pledge and deliver such Pledged Stock to the Collateral
Agent pursuant hereto (or, with respect to the shares of capital stock of any
foreign entities that are not certificated, to execute, deliver, record and
register any and all pledges or charges on such shares which are necessary or
advisable to create a first priority perfected security interest (subject to
clauses (i) and (vi) of the

 

5

 

definition of “Customary
Permitted Liens” in the Credit Agreement) in such shares).  Each Assignor indicated on Schedule C
as owning shares in a foreign entity has executed and delivered and will
promptly following the date hereof record and register, any and all pledges,
charges and other instruments necessary to create valid, continuing, perfected
Liens (or the equivalent rights under the applicable laws of the relevant
foreign jurisdictions) on such Pledged Stock (subject to clauses (i) and (vi) of
the definition of “Customary Permitted Liens” in the Credit Agreement) in favor
of the Collateral Agent, for the benefit of the Collateral Agent and the
Secured Parties.

 

(d)           Necessary Filings. 
Subject to the limitations described in Section 6.21(a) of the
Credit Agreement, all documents and instruments for all filings, registrations
and recordings necessary or appropriate to create, preserve, protect and
perfect the security interests granted by the Assignors to the Collateral Agent
hereby in respect of the Collateral have been delivered by the Assignors to the
Collateral Agent, and, upon the Collateral Agent’s accomplishing of all such
filings, registrations and recordings, the security interests granted to the
Collateral Agent for the benefit of the Collateral Agent and the Secured
Parties pursuant to this Agreement in and to the Collateral constitute or shall
constitute perfected security interests therein and is or shall be entitled to
all the rights, priorities and benefits afforded by the UCC or other relevant
law as enacted in any relevant jurisdiction to perfected security interests;
provided, however, that the parties agree that no Assignor shall have any
obligation hereunder to take any actions to perfect the security interests
granted by such Assignor to the Collateral Agent hereunder in any Excluded
Foreign or Transportation Assets.

 

(e)           Other Financing
Statements.  As of the date hereof, there is no financing
statement (or similar statement or instrument of registration under the law of
any jurisdiction) on file or of record in any relevant jurisdiction covering or
purporting to cover any interest of any kind in the Collateral, except for (i) those
evidencing Permitted Liens and (ii) financing statements evidencing Liens
released on the date hereof (or for which a UCC-3 termination statement or
other release satisfactory to the Collateral Agent shall have been previously
filed or delivered to the Collateral Agent on the date hereof) and, so long as
any of the Secured Obligations are in effect, no Assignor will authorize to be
filed in any public office any financing statement (or similar statement or
instrument of registration under the law of any jurisdiction) or statements
relating to the Collateral, except financing statements filed to or to be filed
in respect of and covering the security interests granted hereby by such
Assignor or for those evidencing Permitted Liens.

 

(f)            Chief Executive Office;
Records.  The chief executive office of each Assignor
is located at the address indicated on Schedule 2.1(f) hereto
for such Assignor.  No Assignor shall
move its chief executive office until (i) it shall have given to the
Collateral Agent not less than 30 days’ (or such shorter period as may be
acceptable to the Collateral Agent) prior written notice of its intention to do
so, clearly describing such new location and providing such other information
in connection therewith as the Collateral Agent may reasonably request, (ii) with
respect to such new location, it shall have taken all action, reasonably
satisfactory to the Collateral Agent, to maintain the security interests of the
Collateral Agent in the Collateral intended to be granted and perfected hereby
at all times fully perfected and in full force and effect, (iii) at the
reasonable request of the Collateral Agent, it shall have furnished an opinion
of counsel acceptable to the Collateral Agent to the effect that all financing
or continuation

 

6

 

statements and amendments
or supplements thereto have been filed in the appropriate filing office or
offices, and all other actions (including, without limitation, the payment of
all filing fees and taxes, if any, payable in connection with such filings)
have been taken, in order to perfect (and maintain the perfection and priority
of) the security interests granted hereby and (iv) the Collateral Agent
shall have received evidence that all other actions (including, without
limitation, the payment of all filing fees and taxes, if any, payable in
connection with such filings) have been taken, in order to perfect (and
maintain the perfection and priority of) the security interests granted hereby.

 

(g)           Location of Inventory
and Equipment.  All Inventory and Equipment held in the
United States of America on the date hereof by each Assignor is located at one
of the locations shown on Schedule 2.1(g) hereto, or at
locations that house Inventory and Equipment having a book value of less than
$1,000,000.  Each Assignor agrees that
all Inventory and Equipment (other than Inventory in transit in the ordinary
course of business or with a book value of less than $1,000,000) now held or
subsequently acquired by it shall be kept at (or shall be in transport to) any
one of the locations shown on Schedule 2.1(g) hereto, at
locations that house Inventory and Equipment having a book value of less than
$1,000,000, or at such new location as such Assignor may establish in
accordance with the last sentence of this Section 2.1(g).  Any Assignor may establish a new location for
Inventory and Equipment only if (i) it shall have given to the Collateral
Agent not less than 15 days (or such shorter period as may be acceptable to the
Collateral Agent) prior written notice of its intention so to do, clearly
describing such new location and providing such other information in connection
therewith as the Collateral Agent may request, (ii) with respect to such
new location, it shall have taken all action reasonably satisfactory to the
Collateral Agent to maintain the security interests of the Collateral Agent in
the Collateral intended to be granted hereby at all times fully perfected and
in full force and effect, (iii) at the reasonable request of the
Collateral Agent, it shall have furnished an opinion of counsel reasonably acceptable to the Collateral Agent to the
effect that all financing or continuation statements and amendments or
supplements thereto have been filed in the appropriate filing office or
offices, and (iv) the Collateral Agent shall have received reasonable evidence that all other actions
(including, without limitation, the payment of all filing fees and taxes, if
any, payable in connection with such filings) have been taken, in order to
perfect (and maintain the perfection and priority of) the security interests
granted hereby.

 

(h)           Vehicles, Aircraft,
Vessels and Railcars.  All aircraft, vehicles, vessels,
barges, railcars and rolling stock owned by each Assignor (other than the
Excluded Transportation Assets) are identified under such Assignor’s name on Schedule 2.1(h).  Each Assignor agrees that in the event it
acquires or otherwise holds title to any vehicles, aircraft, vessels, barges,
railcars or rolling stock (other than the Excluded Transportation Assets) not
otherwise identified on Schedule 2.1(h), such Assignor shall (A) give
the Collateral Agent prompt written notice thereof, clearly describing such new
vehicles, aircraft, vessel, barges, railcars or rolling stock, and shall
provide such other information in connection therewith as the Collateral Agent
may request, and (B) take all actions reasonably satisfactory to the
Collateral Agent to cause the security interest in the Collateral granted by it
hereby to be, and continue at all times to be, fully perfected and in full
force and effect.  The Collateral Agent
hereby agrees, on behalf of the Secured Parties, that the Assignors shall not
be obligated to perfect the Collateral Agent’s security interests in Excluded
Transportation Assets; provided, however, that each Assignor agrees, within ten
(10) days of its receipt of a written request from the Collateral

 

7

 

Agent after the
occurrence and during the continuance of an Event of Default, to take any and
all actions necessary or reasonably requested by the Collateral Agent,
including the execution and delivery of all documents and instruments necessary
or reasonably requested by the Collateral Agent, to perfect the Collateral
Agent’s security interests in any or all Excluded Transportation Assets owned
by such Assignor.

 

(i)            Trade Names; Change of
Name.  No Assignor has or operates in any
jurisdiction, or in the preceding 12 months has had or has operated in any
jurisdiction, under any trade names, fictitious names or other names
(including, without limitation, any names of divisions or operations) except
its legal name and such other trade, fictitious or other names as are listed
under its name on Schedule 2.1(i). 
The true and correct corporation identification number (if applicable)
or other applicable formation identification number (if applicable) of each
Assignor, the exact legal name of each Assignor as it appears in official
filings in the state of its incorporation or organization and the jurisdiction
of incorporation or organization of each Assignor is set forth on Schedule 2.1(i).  No Assignor shall change its legal name or
assume or operate in any jurisdiction under any trade, fictitious or other name
in any manner which might make any financing statement or continuation
statement filed in connection therewith misleading within the meaning of Article 9
of the UCC until (i) it shall have given to the Collateral Agent not less
than 30 days’ prior written notice of its intention so to do, clearly
describing such new name and the jurisdictions in which such new name shall be
used and providing such other information in connection therewith as the Collateral
Agent may reasonably request, (ii) with respect to such new name, it shall
have taken all action to maintain the security interests of the Collateral
Agent in the Collateral intended to be granted hereby at all times fully
perfected and in full force and effect, (iii) at the reasonable request of
the Collateral Agent, it shall have furnished an opinion of counsel reasonably acceptable to the Collateral Agent to the
effect that all financing or continuation statements and amendments or
supplements thereto have been filed in the appropriate filing office or
offices, and (iv) the Collateral Agent shall have received evidence
reasonably satisfactory to it that all other actions (including, without
limitation, the payment of all filing fees and taxes, if any, payable in
connection with such filings) have been taken, in order to perfect (and
maintain the perfection and priority of) the security interests granted hereby.

 

(j)            State of Incorporation. 
The jurisdiction of incorporation or formation of each Assignor as of
the date hereof is listed Schedule 2.1(j).  Without limiting the prohibitions on mergers
involving the Assignors contained in the Credit Agreement, no Assignor shall
reincorporate or reorganize itself under the laws of any jurisdiction other than
the jurisdiction in which it is incorporated or organized as of the date hereof
unless (i) it shall have given to the Collateral Agent not less than 30
days’ prior written notice of its intention to do so, clearly describing such
new state of incorporation or formation, as the case may be, and providing such
other information in connection therewith as the Collateral Agent may
reasonably request, (ii) with respect to such new state of incorporation
or formation, as the case may be, it shall have taken all action, reasonably
satisfactory to the Collateral Agent, to maintain the security interest of the
Collateral Agent in the Collateral intended to be granted and perfected hereby
at all times fully perfected and in full force and effect, (iii) at the
reasonable request of the Collateral Agent, it shall have furnished a customary
opinion of counsel reasonably acceptable to the Collateral Agent to the effect
that all financing or continuation statements and amendments or supplements
thereto have been filed in the appropriate filing office or offices, and all
other actions (including, without limitation, the payment of all filing fees
and taxes, if any, payable in connection with

 

8

 

such filings) have been
taken, in order to perfect (and maintain the perfection and priority of) the
security interest granted hereby and (iv) the Collateral Agent shall have
received evidence reasonably satisfactory to it that all other actions
(including, without limitation, the payment of all filing fees and taxes, if
any, payable in connection with such filings have been taken, in order to
perfect (and maintain the perfection and priority of) the security interest
granted hereby.

 

(k)           Commercial Tort Claims. 
No Assignor has any Commercial Tort Claims, except as listed on Schedule 2.1(k).

 

2.2          Reliance. 
All agreements, statements, representations and warranties made by each
Assignor herein or in any certificate or other instrument delivered by such
Assignor or on its behalf under this Agreement shall be considered to have been
relied upon by the Secured Parties and shall survive the execution and delivery
of this Agreement, the other Loan Documents, the Senior Secured Notes
Indenture, the Senior Secured Notes, the Secured Hedging Agreements and the
Overdraft Facilities Agreements regardless of any investigation made by the
Secured Parties or on their behalf.

 

ARTICLE III

 

SPECIAL
PROVISIONS CONCERNING RECEIVABLES;

CONTRACT RIGHTS; INSTRUMENTS

 

3.1          Additional Representations and
Warranties.  The Assignors hereby agree with respect
to the Receivables that as of the time when each Receivable arises, each
Assignor shall be deemed to have represented and warranted to the Collateral
Agent that such Receivable, and all records, papers and documents relating
thereto (if any) are genuine and in all respects what they purport to be, and
that all papers and documents (if any) relating thereto (i) will, to the
best of such Assignor’s knowledge, represent the genuine, legal, valid and
binding obligation of the account debtor evidencing indebtedness unpaid and
owed by the respective account debtor arising out of the performance of labor
or services or the sale or lease and delivery of the merchandise listed
therein, or both; (ii) will be the only original writings evidencing and
embodying such obligation of the account debtor named therein (other than
copies created for general accounting purposes); (iii) will, to the best
of such Assignor’s knowledge, evidence true and valid obligations, enforceable
in accordance with their respective terms; and (iv) will be in compliance
and will conform in all material respects with all Requirements of Law.

 

3.2          Maintenance of Records. 
Each Assignor will keep and maintain at its own cost and expense
satisfactory and complete records of its Receivables and Contracts (other than
Contracts that do not constitute Collateral), including, but not limited to,
the originals (where available) of all documentation (including each Contract,
other than Contracts that do not constitute Collateral) with respect thereto,
records of all payments received, all credits granted thereon, all merchandise
returned and all other dealings therewith, and that such Assignor will make the
same available on such Assignor’s premises to the Collateral Agent for
inspection, at such Assignor’s own cost and expense, at any and all reasonable
times upon demand.  Upon the occurrence
and during the continuance of an Event of Default and at the reasonable request
of the Collateral Agent, each Assignor shall, at its own cost and expense,
deliver all tangible

 

9

 

evidence of its
Receivables and Contract Rights (including, without limitation, all documents
evidencing the Receivables and all Contracts, other than Contracts that do not
constitute Collateral) and such books and records to the Collateral Agent or to
its representatives (copies of which evidence and books and records may be
retained by such Assignor).  Upon the Collateral
Agent’s reasonable request, each Assignor shall legend, in form and manner
reasonably satisfactory to the Collateral Agent, the Receivables and the
Contracts, as well as books, records and documents of such Assignor evidencing
or pertaining to such Receivables and Contracts with an appropriate reference
to the fact that such Receivables and Contracts have been assigned to the
Collateral Agent and that the Collateral Agent has security interests therein.

 

3.3          Instruments. 
If any Assignor owns or acquires any Instrument (other than a promissory
note) constituting Collateral with a fair market value in excess of $100,000,
such Assignor will within thirty (30) days notify the Collateral Agent thereof,
and upon request by the Collateral Agent will promptly, and in any event within
thirty (30) days (unless otherwise extended at the discretion of the Collateral
Agent) deliver such Instrument to the Collateral Agent appropriately endorsed
to the order of the Collateral Agent as further security hereunder.

 

3.4          Direction to Account Debtors; Contracting
Parties, etc.  Upon the occurrence and during the
continuance of an Event of Default, if the Collateral Agent so directs any
Assignor, such Assignor agrees (x) to cause all payments on account of the
Receivables and Contracts to be made directly to the Collateral Agent or, upon
direction of the Collateral Agent, to a separate cash collateral account
established with respect to such Assignor, (y) that the Collateral Agent may,
at its option, directly notify the obligors with respect to any Receivables
and/or under any Contracts to make payments with respect thereto as provided in
preceding clause (x), and (z) that the Collateral Agent may enforce collection
of any such Receivables and Contracts and may adjust, settle or compromise the
amount of payment thereof, in the same manner and to the same extent that such
Assignor might have done, and, without notice to or assent by such Assignor,
the Collateral Agent may apply any or all amounts then in, or thereafter
deposited in, any cash collateral so paid to the Collateral Agent or account in
the manner provided in Section 8.5. 
The costs and expenses (including reasonable attorneys’ fees) of
collection, whether incurred by an Assignor or the Collateral Agent, shall be
borne by the applicable Assignor.

 

ARTICLE IV

 

SPECIAL
PROVISIONS CONCERNING MARKS

 

4.1          Additional Representations and
Warranties.  Each Assignor represents and warrants to
the Collateral Agent as of the date hereof (or, in the case of an Assignor made
party hereto pursuant to its execution of a supplement hereto in accordance
with Section 14.2(d), as of the date of such supplement) that (a) it
is the true and lawful exclusive owner of the registrations and pending
applications for Marks listed under its name in Schedule 4.1,
except where the failure to do so could not reasonably be expected to have a
Material Adverse Effect, (b) said listed registrations and pending
applications for Marks include all the registrations or pending applications in
the United States Patent and Trademark Office that such Assignor now owns in
connection with its business, (c) to its knowledge, it owns or is licensed
to use all Marks that it uses, except where the failure to do so could not
reasonably be expected to have a Material

 

10

 

Adverse Effect, (d) except
as indicated on Schedule 4.1, it is aware of no third party claim
that any aspect of such Assignor’s present or contemplated business operations
infringes or will infringe any Mark in any manner that is reasonably likely to
have a Material Adverse Effect, (e) the Marks listed under its name in Schedule 4.1
are subsisting, have not been canceled, and, to its knowledge, valid, except
with respect to any such Marks that are not necessary or material to the
operation or financial condition of Assignor’s business and (f) it owns or
is licensed to use all United States trademark registrations and applications
that it uses, except where the failure to do so could not reasonably be
expected to have a Material Adverse Effect.  Each Assignor hereby grants to the Collateral
Agent an absolute power of attorney to sign, upon the occurrence and during the
continuance of an Event of Default, any document which may be required by the
United States Patent and Trademark Office in order to effect an absolute
assignment of all right, title and interest in each Mark and associated
goodwill, and record the same.  Each
Assignor agrees to update Schedule 4.1 from time to time (but no
less frequently than annually) to reflect any new information required to be
indicated thereon and will provide such supplement to the Collateral Agent in
the form required by the Collateral Agent.

 

4.2          Divestitures.  Each Assignor hereby agrees not to divest itself of
any material right under any Significant Mark absent prior written approval of
the Collateral Agent, except in accordance with the Credit Agreement.

 

4.3          Infringements. 
Each Assignor agrees, promptly upon learning thereof, to notify the
Collateral Agent in writing of the name and address of, and to furnish such
pertinent non-privileged information that may be available with respect to, any
party who may be infringing or otherwise violating any of such Assignor’s
rights in and to any Significant Mark, or with respect to any party claiming
that such Assignor’s use of any Significant Mark violates any property right of
that party, in each case to the extent that such Assignor reasonably believes
that, with respect to such infringement, if determined adversely to such
Assignor, it could reasonably be expected to have a Material Adverse Effect.

 

4.4          Preservation of Marks.  Each Assignor shall have the duty to: (a) prosecute
diligently any trademark application or service mark application that is a part
of the Significant Marks pending as of the date hereof or hereafter; (b) make
application for registration of trademarks or service marks which are necessary
or material to the operation or financial condition of such Assignor’s
business; and (c)  use its best efforts to maintain in full force and
effect the Significant Marks and the licenses therefor.

 

4.5          Maintenance of Registration. 
Each Assignor shall, at its own expense, diligently process all
documents required by the Trademark Act of 1946, 15 U.S.C. §§ 1051 et seq.
to maintain trademark registrations, including but not limited to affidavits of
use and applications for renewals of registration in the United States Patent
and Trademark Office for all of its Significant Marks pursuant to 15 U.S.C. §§ 1058(a),
1059 and 1065, and shall pay all fees and disbursements in connection therewith
and shall not abandon any such filing of any affidavit of use or any such
application of renewal for any of its Significant Marks prior to the exhaustion
of all reasonable administrative and judicial remedies without prior written
consent of the Collateral Agent, except as otherwise permitted under Section 4.4
herein.

 

11

 

4.6          Future Registered Marks. 
Each Assignor shall, on an annual basis, deliver to the Collateral Agent
(a) a copy of each Significant Mark registration issued after the date
hereof to such Assignor as a result of any application now or hereafter pending
before the United States Patent and Trademark Office, and (b) a grant of
security in such Significant Mark to the Collateral Agent in the manner
provided herein, confirming the grant thereof hereunder, the form of such grant
to be substantially the same as the form hereof.

 

4.7          Remedies.  If an Event of Default shall occur and be continuing,
the Collateral Agent may, subject to the provisions of Article VIII by
written notice to any Assignor, take any or all of the following actions: (i) declare
the entire right, title and interest of such Assignor in and to each of its
Marks, together with the goodwill of the business associated therewith,
together with all trademark rights and rights of protection to the same,
vested, in which event such rights, title and interest shall immediately vest,
in the Collateral Agent for the benefit of the Secured Parties, in which case
the Collateral Agent shall be entitled to exercise the power of attorney
referred to in Section 4.1 to execute, cause to be acknowledged and
notarized and record said absolute assignment with the applicable agency; (ii) take
and use or sell its Marks and the goodwill of such Assignor’s business
symbolized by its Marks and the right to carry on the business and use the
assets of such Assignor in connection with which its Marks have been used; and (iii) direct
such Assignor to refrain, in which event such Assignor shall refrain, from
using its Marks in any manner whatsoever, directly or indirectly, and execute
such other and further documents that the Collateral Agent may request to
further confirm this and to transfer ownership of its Marks and registrations
and any pending trademark application in the United States Patent and Trademark
Office or any equivalent government agency or office to the Collateral
Agent.  Notwithstanding any provision in
this Agreement to the contrary, no Assignor shall be required to file or take
other action to perfect in any foreign jurisdiction the Liens with respect to
any Marks, Patents or Copyrights other than filings with the United States
Patent and Trademark Office or the United States Copyright Office and no
representation or warranty shall be construed to require the foregoing or
breached by the failure to so file or take such other action; provided,
however, that each Assignor agrees, within ten (10) days of its receipt of
a written request from the Collateral Agent after the occurrence and during the
continuance of an Event of Default, to take any and all actions necessary or
reasonably requested by the Collateral Agent, including the execution and
delivery of all documents and instruments necessary or reasonably requested by
the Collateral Agent, to perfect the Collateral Agent’s security interests in
any or all Marks owned by such Assignor which have not previously been
perfected.

 

ARTICLE V

 

SPECIAL
PROVISIONS CONCERNING

PATENTS, COPYRIGHTS AND TRADE SECRETS

 

5.1          Additional Representations and
Warranties.  Each Assignor represents and warrants that
upon the recordation of each Grant of Security Interest in United States
Trademarks and Patents in the form of Annex B hereto in the United
States Patent and Trademark Office and the recordation of a Grant of Security
Interest in United States Copyrights in the form of Annex C hereto in
the United States Copyright Office, together with filings of appropriate UCC
financing statements pursuant to this Agreement, all filings, registrations and
recordings necessary or appropriate to perfect the security interests granted
to the Collateral

 

12

 

Agent in the United
States Patents and United States Copyrights covered by this Agreement under
federal law will have been accomplished to the extent such perfection may be
obtained under federal law.  Each
Assignor agrees to execute such a Grant of Security Interest in United States
Significant Trademarks and Significant Patents covering all right, title and
interest in each United States Patent of such Assignor and to record the same,
and to execute such a Grant of Security Interest in United States Significant
Copyrights covering all right, title and interest in each United States
Copyright of such Assignor and to record the same. Each Assignor hereby grants to the Collateral Agent an
absolute power of attorney to sign, upon the occurrence and during the
continuance of an Event of Default, any document which may be required by the
United States Patent and Trademark Office or the United States Copyright Office
in order to effect an absolute assignment of all right, title and interest in
each Patent and Copyright owned by such Assignor, and record the same.  Each Assignor agrees to update Schedule 5.1
from time to time at the request of the Collateral Agent (but no less
frequently than annually) to reflect any new information required to be
indicated thereon and will provide such supplement to the Collateral Agent in
the form required by the Collateral Agent.

 

5.2          Infringements. 
Each Assignor agrees, promptly upon learning thereof, to furnish the
Collateral Agent in writing with all pertinent non-privileged information
available to such Assignor with respect to any infringement or other violation
by any third party of such Assignor’s rights in and to any Significant Patent
or Significant Copyright, or with respect to any third-party claim that
practice of any Significant Patent or Significant Copyright by such Assignor
violates any property right of that party, or with respect to any
misappropriation of any Trade Secret of such Assignor or any third-party claim
that such Assignor’s practice of any Trade Secret violates any property right
of a third party, in each case, to the extent that such Assignor reasonably
believes that such infringement or violation, if determined adversely to such
Assignor, could reasonably be expected to have a Material Adverse Effect.  Each Assignor further agrees, consistent with
good business practice, to diligently prosecute any Person infringing any
Significant Patent or Significant Copyright or any Person misappropriating any
of such Assignor’s Trade Secrets to the extent that such Assignor reasonably
believes that such infringement or misappropriation is material to its business.

 

5.3          Preservation of Patents. 
Each Assignor shall have the duty to: (a) prosecute diligently any
Patent or Copyright application that is pending as of the date hereof or
hereafter which is necessary or material to the operation or financial condition
of such Assignor’s business; (b) make application for Patents and
Copyrights which are necessary or material to the operation or financial
condition of such Assignor’s business; and (c) use its best efforts to
maintain in full force and effect the Significant Patents, the Significant
Copyrights and the licenses therefor that are or shall be necessary or material
to the operation or financial condition of such Assignor’s business.  At its own expense, each Assignor shall make
timely payment of all post-issuance fees required pursuant to 35 U.S.C. § 41
to maintain in force rights under each Significant Patent.

 

5.4          Prosecution of Patent Applications. 
At its own expense, each Assignor shall diligently prosecute all
applications for all Significant Patents.

 

5.5          Other Patents and Copyrights. 
Each Assignor shall, at the request of the Collateral Agent (but no less
frequently than annually), deliver to the Collateral Agent (a) a copy

 

13

 

of the first page of
each Significant Patent or Significant Copyright issued after the date hereof
and (b) a grant of security in any such Significant Patent or Significant
Copyright, or application thereof as the case may be, to the Collateral Agent,
confirming the grant thereof hereunder, the form of such grant to be
substantially the same as the form hereof.

 

5.6          Remedies. 
If an Event of Default shall occur and be continuing, the Collateral
Agent may, subject to the provisions of Article VIII, by written notice to
any Assignor, take any or all of the following actions: (i) declare the
entire right, title, and interest of such Assignor in each of its Patents and
Copyrights vested in the Collateral Agent for the benefit of the Secured
Parties, in which event such right, title, and interest shall immediately vest
in the Collateral Agent for the benefit of the Secured Parties, in which case
the Collateral Agent shall be entitled to exercise the power of attorney
referred to in Section 5.1 to execute, cause to be acknowledged and
notarized and record said absolute assignment with the applicable agency; (ii) take,
practice, use or sell its Patents and Copyrights; and (iii) direct such
Assignor to refrain, in which event such Assignor shall refrain, from
practicing its Patents or using its Copyrights directly or indirectly, and such
Assignor shall execute such other and further documents as the Collateral Agent
may request further to confirm this and to transfer ownership of its Patents
and Copyrights to the Collateral Agent for the benefit of the Secured Parties.

 

ARTICLE VI

 

PROVISIONS
CONCERNING PLEDGED SECURITIES

 

From the date hereof and continuing thereafter until
this Agreement is terminated pursuant to Section 12.2, each
Assignor covenants and agrees with the Collateral Agent and the Secured Parties
as follows:

 

6.1          Pledge of Notes and Additional Stock. 
If any Assignor shall acquire in any manner any promissory notes
evidencing Indebtedness in excess of $1,000,000 (including any Intercompany
Notes), such Assignor shall forthwith (and without the necessity for any
request or demand by the Collateral Agent or any Secured Party) deliver such
promissory notes or Intercompany Notes, as the case may be, to or for the
benefit of the Collateral Agent in the same manner as described in Section 1.2,
together with a supplement to Schedule B reflecting the addition of
such additional Intercompany Notes whereupon such promissory notes or
Intercompany Notes shall be deemed to be pledged promissory notes or Pledged
Intercompany Notes for all purposes hereunder. 
To the extent required by the Credit Agreement, if any Assignor shall at
any time acquire any additional shares of the Capital Stock of any class
pledged or required to be pledged hereunder, other than Capital Stock described
in Section 1.1(c)(i), whether such acquisition shall be by
purchase, exchange, reclassification, dividend, or otherwise, or acquire any
new Capital Stock, such Assignor shall forthwith (and without the necessity for
any request or demand by the Collateral Agent or any Secured Party) (a) unless
such shares are uncertificated shares of a foreign entity, deliver such share
certificates to the Collateral Agent in the same manner as described in Section 1.2,
or (b) if such shares are uncertificated shares of Capital Stock of a
foreign entity, take all actions necessary to grant to the Collateral Agent a
perfected security interest in such shares (including the execution, delivery,
recording and registering of a pledge or a charge on shares with any and all
appropriate company or governmental offices) together with, in either case, a
supplement to Schedule C reflecting the

 

14

 

addition of such
additional share certificates of Capital Stock, whereupon such additional share
certificates of Capital Stock shall be deemed to be Pledged Stock for all
purposes hereunder.  Each Assignor will
hold in trust for the Collateral Agent and the Secured Parties upon receipt and
immediately thereafter deliver to the Collateral Agent any instrument
evidencing or constituting Collateral (except, so long as no Event of Default
has occurred and is continuing, ordinary cash dividends, if any, paid with
respect to the Pledged Stock and the Stock Rights and payments in respect of
the pledged promissory notes (including the Pledged Intercompany Notes), in
each case as permitted by the Credit Agreement).

 

6.2          Capital Stock.

 

(a)           Registration of Capital
Stock.  At any time after the occurrence and during
the continuance of an Event of Default, each Assignor will, to the extent
permitted by the Requirements of Law, permit any registerable Capital Stock
constituting Collateral to be registered in the name of the Collateral Agent or
its nominee at the option of the Collateral Agent.

 

(b)           Exercise of Rights in
Capital Stock.  Subject to Article VIII, each
Assignor will permit the Collateral Agent or its nominee at any time after the
occurrence and during the continuance of an Event of Default, without notice,
to exercise all voting and corporate rights relating to the Capital Stock
constituting Collateral, including, without limitation, exchange, subscription
or any other rights, privileges, or options pertaining to any shares of the
Capital Stock and the Stock Rights as if it were the absolute owner thereof.

 

ARTICLE VII

 

PROVISIONS
CONCERNING ALL COLLATERAL

 

7.1          Protection of Collateral Agent’s
Security.  Each Assignor covenants that it will do
nothing to impair the rights of the Collateral Agent in the Collateral
hereunder.  Each Assignor assumes all
liability and responsibility in connection with the Collateral acquired by it
and the liability of such Assignor to satisfy its Secured Obligations shall in
no way be affected or diminished by reason of the fact that such Collateral may
be lost, destroyed, stolen, damaged or for any reason whatsoever unavailable to
such Assignor, except due to the gross negligence or willful misconduct of the
Collateral Agent.

 

7.2          Warehouse Receipts Non-negotiable. 
Each Assignor agrees that if any warehouse receipt or receipt in the nature
of a warehouse receipt is issued with respect to any of its Inventory, such
warehouse receipt or receipt in the nature thereof shall either (a) not be
“negotiable” (as such term is used in Section 7-104 of the UCC as in
effect in any relevant jurisdiction or under other relevant law), or (b) if
negotiable, the security interest of the Collateral Agent in such warehouse
receipt shall be perfected to the reasonable satisfaction of the Collateral
Agent if the value of Inventory housed at such warehouse is greater than
$1,000,000.

 

7.3          Right to Initiate Judicial
Proceedings, etc.  Upon the
occurrence and during the continuance of an Unmatured Event of Default or an
Event of Default, the Collateral Agent shall have the exclusive right,
obligation and power to institute and maintain, and it shall

 

15

 

institute and maintain
such suits and proceedings as directed by the Instructing Group pursuant to
this Agreement to protect and enforce the rights vested in it by this Agreement
for the benefit of the Secured Parties.

 

7.4          Appointment of a Receiver. 
After the occurrence and during the continuance of an Event of Default,
the Collateral Agent may be appointed as a receiver of any or all of the
Collateral in a judicial proceeding. 
Notwithstanding the appointment of a receiver, the Collateral Agent
shall be entitled to retain possession and control of all cash held by or
deposited with it or its agents or co-agents pursuant to any provision of this
Agreement or any Mortgage.

 

7.5          Further Actions. 
Subject to the last sentence of Sentence 2.1(h), each Assignor
will, at its own expense, make, execute, endorse, acknowledge, file and/or
deliver to the Collateral Agent from time to time such lists, descriptions and
designations of its Collateral, warehouse receipts, receipts in the nature of
warehouse receipts, bills of lading, documents of title, vouchers, invoices,
schedules, confirmatory assignments, conveyances, financing statements,
transfer endorsements, powers of attorney, certificates, reports and other
assurances or instruments and take such further steps relating to the
Collateral and other property or rights covered by the security interest hereby
granted by such Assignor, which the Collateral Agent deems reasonably
appropriate or advisable to perfect, preserve, realize upon or protect its
security interest in the Collateral, within seven days after any request by the
Collateral Agent or such earlier date as may be required by law or necessary to
preserve or protect the security interests in the Collateral granted by such
Assignor pursuant to this Agreement. 
Without limiting the foregoing, upon the institution of any action,
claim or proceeding that could reasonably be expected to result in a material
Commercial Tort Claim, Assignors will deliver to Collateral Agent an amended Schedule 2.1(k)
(which Schedule shall be deemed to be amended upon such delivery) setting
forth a brief description of the nature of the case, the parties and the case
number if one has been assigned by the applicable court.

 

7.6          Financing Statements. 
Each Assignor agrees to authorize and deliver to the Collateral Agent
such financing statements, in form acceptable to the Collateral Agent, as the
Collateral Agent may from time to time request as are necessary or desirable in
the reasonable opinion of the Collateral Agent to establish and maintain a
valid, enforceable, first priority perfected security interest in its
Collateral (except that no Assignor shall be required to perfect the security interests
granted by it hereunder in any Excluded Foreign or Transportation Assets) in
favor of the Collateral Agent for the benefit of the Secured Parties and as
provided herein and the other rights and security contemplated hereby all in
accordance with the Uniform Commercial Code as enacted in any and all relevant
jurisdictions or any other relevant law. 
Each Assignor will pay any applicable filing fees, recordation taxes and
expenses relating to its Collateral. 
Each Assignor authorizes the Collateral Agent to file and deliver any
such financing statements without the signature of such Assignor where
permitted by law.  The Assignors
authorize the filing of any financing statement that the Collateral Agent deems
necessary or advisable and such financing statements may include super-generic
descriptions of the Collateral.

 

7.7          Control. 
To the extent required under Section 9-313 of the Uniform
Commercial Code, where any Collateral with a fair market value of greater than
$5,000,000 is in the possession of a third party, each Assignor will join with
the Collateral Agent in notifying the

 

16

 

third party of the
Collateral Agent’s security interests and will use its commercially reasonable
efforts to obtain an acknowledgement from the third party that it is holding
the Collateral for the benefit of the Collateral Agent.  Upon request of the Collateral Agent, each
Assignor will cooperate with the Collateral Agent in obtaining control with
respect to Collateral consisting of:  (i) Investment
Property (to the extent “control” within the meaning of Sections 8-106 and 9-106
of the UCC can be obtained with respect to such Investment Property); (ii) Letter-of-Credit
Rights; and (iii) Electronic Chattel Paper.  In the event any Assignor is the beneficiary
of any individual letter of credit in excess of $250,000 (or letters of credit
in excess of $1,000,000 in the aggregate), such Assignor shall enter into a
tri-party agreement with the Collateral Agent and the issuer or confirmation
bank for such letter of credit with respect to Letter-of-Credit Rights related
to such letter of credit assigning such Letter-of-Credit Rights to the
Collateral Agent and directing all payments thereunder to the Collateral
Account, all in form and substance reasonably satisfactory to the Collateral
Agent.

 

ARTICLE VIII

 

REMEDIES
UPON OCCURRENCE OF EVENT OF DEFAULT

 

8.1          Default.

 

(a)           Unless and until an Event of Default
shall occur and be continuing and subject to the last sentence of Section 6.1
above, each Assignor shall be entitled to receive all cash dividends or other
distributions on its Pledged Stock except (i) distributions made in
Capital Stock on such Pledged Stock resulting from stock dividends on or
subdivision, combination or reclassification of the outstanding Capital Stock
of any corporation or as a result of any merger, consolidation, acquisition or
other exchange of assets of any corporation unless the requirements of the next
sentence are complied with; and (ii) all sums paid in respect of such
Pledged Stock upon liquidation or dissolution, repurchase, retirement or
redemption, other than as permitted by Section 8.3 of the Credit
Agreement.  All such sums, dividends,
distributions, proceeds or property described in the immediately preceding
clauses (i) and (ii) shall, if received by any Assignor, be held in
trust for the benefit of the Collateral Agent and Secured Parties and shall
forthwith be delivered to the Collateral Agent (accompanied by proper
instruments of assignment and/or stock powers executed by such Assignor in
accordance with the Collateral Agent’s instructions) to be held subject to the
terms of this Agreement.  Upon the
occurrence and during the continuance of a Event of Default, the Collateral
Agent shall be entitled to receive all payments of whatever kind made upon or
with respect to any Collateral and to hold such payments as Collateral or apply
such payments pursuant to the terms of this Agreement.

 

(b)           At any time after an Event of Default has
occurred and is continuing, the Collateral Agent shall be entitled upon
delivery of a written certification from the Administrative Agent to the
Collateral Agent certifying that an Event of Default has occurred and is
continuing (a “Default Certification”) to exercise, or to refrain from
exercising, any right, remedy, trust or power available to or conferred on the
Collateral Agent hereunder and in connection herewith or under any Mortgage and
in connection therewith, to direct the time, method and place of conducting any
proceeding for any right or remedy available to the Collateral Agent under this
Agreement or any such Mortgage or of exercising any trust or power conferred on
the Collateral

 

17

 

Agent under this
Agreement or any such Mortgage, or for the appointment of a receiver, or to
direct the taking or refraining from taking of any other action authorized by
this Article VIII.

 

(c)           So long as no Event of Default has
occurred and is continuing, the Assignors shall have the sole and exclusive
right to vote and give consents with respect to all of their respective Pledged
Securities and to consent to, ratify or waive notice of any and all
meetings.  Upon the occurrence and during
the continuance of an Event of Default, the Collateral Agent, on behalf of the
Secured Parties, shall have the exclusive right, but shall not be obligated, (i) to
vote and give consents with respect to any merger, consolidation, liquidation
or reorganization of the issuer of any Pledged Stock and, in connection
therewith, to join in and become a party to any plan of recapitalization,
reorganization, or readjustment (whether voluntary or involuntary) as shall
seem desirable to the Collateral Agent, to protect or further their interests
in respect of the Collateral, (ii) to deposit the Collateral under any
such plan, and (iii) to make any exchange, substitution, cancellation or
surrender of the Collateral required by any such plan and to take such action
with respect to the Collateral as may be required by any such plan or for the
accomplishment thereof, and no such disposition, exchange, substitution,
cancellation or surrender shall be deemed to constitute a release of the
Collateral from the Liens of this Agreement.

 

8.2          Remedies; Obtaining the Collateral Upon
Default.  Each Assignor agrees that if any Event of
Default shall have occurred and be continuing, then and in every such case,
subject to any mandatory requirements of applicable law then in effect, the
Collateral Agent, acting at the direction of the Instructing Group, shall have,
in addition to any rights now or hereafter existing under applicable law, and
shall have all rights as a secured creditor under the Uniform Commercial Code
in all relevant jurisdictions and may also:

 

(a)           personally, or by agents or attorneys,
immediately take or retake, as the case may be, possession of such Assignor’s
Collateral or any part thereof, from such Assignor or any other Person who then
has possession of any part thereof with or without notice or process of law, and
for that purpose may enter upon such Assignor’s premises where any of such
Collateral is located and remove the same and use in connection with such
removal any and all services, supplies, aids and other facilities of the
Assignor; and

 

(b)           in addition to any rights the Collateral
Agent may have under Section 3.4, instruct the obligor or obligors
on any agreement, instrument or other obligation (including, without
limitation, the Receivables and the Contracts) constituting such Assignor’s
Collateral to make any payment required by the terms of such agreement,
instrument or other obligation directly to the Collateral Agent or to a cash
collateral account and may exercise any and all remedies of such Assignor in
respect of such Collateral; and

 

(c)           withdraw all monies, securities and
instruments in any cash collateral account for application to the Secured
Obligations in accordance with Section 8.5 hereof; and

 

(d)           sell, assign or otherwise liquidate, or
direct any Assignor to sell, assign or otherwise liquidate, any or all of the
Collateral or any part thereof, and take possession of the proceeds of any such
sale or liquidation; and

 

18

 

(e)           take possession of the Collateral or any
part thereof, by directing any Assignor in writing to deliver the same to the
Collateral Agent at any place or places designated by the Collateral Agent, in
which event such Assignor shall at its own expense:

 

(i)            forthwith cause the same to be moved to
the place or places so designated by the Collateral Agent and there delivered
to the Collateral Agent, and

 

(ii)           store and keep any such Collateral so
delivered to the Collateral Agent at such place or places pending further
action by the Collateral Agent as provided in Section 8.3 hereof,
and

 

(iii)          while such Collateral shall be so stored
and kept, provide such guards and maintenance services as shall be necessary to
protect the same and to preserve and maintain them in good condition; and

 

(f)            in addition to any rights the Collateral Agent
may have under Sections 4.7 and 5.7, license or sublicense (to
the extent not in violation of the license), whether on an exclusive or
nonexclusive basis, any Marks (together with associated goodwill), Patents or
Copyrights included in such Collateral for such term and on such conditions and
in such manner as the Collateral Agent shall in its sole judgment determine;

 

it
being understood that each Assignor’s obligation so to deliver such Collateral
is of the essence of this Agreement and that, accordingly, upon application to
a court of equity having jurisdiction, the Collateral Agent shall be entitled
to a decree requiring specific performance by each Assignor of said obligation.

 

8.3          Remedies; Disposition of the
Collateral.  Any Collateral repossessed by the Collateral
Agent under or pursuant to Section 8.2 and any other Collateral
whether or not so repossessed by the Collateral Agent, may be sold, assigned,
leased or otherwise disposed of under one or more contracts or as an entirety,
and without the necessity of gathering at the place of sale the property to be
sold, and in general in such manner, at such time or times, at such place or
places and on such terms as the Collateral Agent may, in compliance with any
mandatory requirements of applicable law, determine to be commercially
reasonable.  Subject to mandatory
requirements of applicable laws then in effect, any of the Collateral may be
sold, leased or otherwise disposed of in the condition in which the same existed
when taken by the Collateral Agent or after any overhaul or repair at the
expense of the relevant Assignor which the Collateral Agent shall determine to
be commercially reasonable.  Subject to
mandatory requirements of applicable laws then in effect, any such disposition
that shall be a private sale or other private proceeding permitted by such
requirements shall be made upon not less than ten (10) days’ written
notice to the applicable Assignor specifying the time at which such disposition
is to be made and the intended sale price or other consideration therefor, and
shall be subject, for the ten (10) days after the giving of such notice,
to the right of the applicable Assignor or any nominee of such Assignor to
acquire the Collateral involved at a price or for such other consideration at
least equal to the intended sale price or other consideration so
specified.  Subject to mandatory
requirements of applicable laws then in effect, any such disposition that shall
be a public sale permitted by such requirements shall be made upon not less than
ten (10) days’ written notice to the applicable Assignor specifying the
time and place of such sale and, in the absence of

 

19

 

applicable requirements
of law, shall be by public auction (which may, at the Collateral Agent’s
option, be subject to reserve), after publication of notice of such auction not
less than ten (10) days prior thereto in two newspapers of general
circulation in Salt Lake City, Utah, the City of New York and in such other
locations as may be necessary in order for the sale to be “commercially
reasonable” (as such term is used in Article 9 of the Uniform Commercial
Code). To the extent not prohibited by any Requirement of Law, the Collateral
Agent or any Secured Party may bid for (for cash or as credit against the
amount owing to it) and become the purchaser of the Collateral or any item
thereof, offered for sale in accordance with this Section without
accountability to the applicable Assignor. 
If, under mandatory requirements of applicable law, the Collateral Agent
shall be required to make disposition of the Collateral within a period of time
which does not permit the giving of notice to the applicable Assignor as
hereinabove specified, the Collateral Agent need give such Assignor only such
notice of disposition as shall be reasonably practicable in view of such
mandatory requirements of applicable law. 
Each Assignor agrees to do or cause to be done all such other acts and
things as may be reasonably necessary to make such sale or sales of all or any
portion of the Collateral pledged by it valid and binding and in compliance
with any and all Requirements of Law, all at such Assignor’s expense.  Proceeds of any sale or other disposition of
Collateral pursuant hereto shall be applied in accordance with Section 8.5.

 

8.4          Waiver of Claims.  Except as otherwise provided in this Agreement, EACH
ASSIGNOR HEREBY WAIVES, TO THE EXTENT PERMITTED BY THE REQUIREMENTS OF LAW,
NOTICE AND JUDICIAL HEARING IN CONNECTION WITH THE COLLATERAL AGENT’S TAKING
POSSESSION OR THE COLLATERAL AGENT’S DISPOSITION OF ANY OF THE COLLATERAL
PURSUANT TO SECTION 8.2, INCLUDING, WITHOUT LIMITATION, ANY AND ALL
PRIOR NOTICE AND HEARING FOR ANY PRE-JUDGMENT REMEDY OR REMEDIES, and in
connection therewith, each Assignor hereby further waives, to the extent
permitted by law:

 

(a)           all damages occasioned by such taking of
possession except any damages which are the direct result of the gross
negligence or willful misconduct of the Collateral Agent, its employees or
agents;

 

(b)           all other requirements as to the time,
place and terms of sale or other requirements with respect to the enforcement
of the Collateral Agent’s rights hereunder; and

 

(c)           all rights of redemption, marshaling,
appraisement, valuation, stay, extension or moratorium now or hereafter in
force under any applicable law in order to prevent or delay the enforcement of
this Agreement or the absolute sale of the Collateral or any portion thereof,
and such Assignor, for itself and all who may claim under it, insofar as it or
they now or hereafter lawfully may, hereby waives the benefit of all such laws.

 

Any
sale of, or the grant of options to purchase, or any other realization upon,
any Collateral shall operate to divest all right, title, interest, claim and
demand, either at law or in equity, of the applicable Assignor therein and
thereto, and shall be a perpetual bar both at law and in equity against such
Assignor and against any and all Persons claiming or attempting to claim the
Collateral so sold, optioned or realized upon, or any part thereof, from,
through and under such Assignor.

 

20

 

8.5          Application of Proceeds.

 

(a)           Subject to Section 1.5, all
moneys collected by the Collateral Agent (or, to the extent any Mortgage to
which any Assignor is a party requires proceeds of Assets under such agreement
to be applied in accordance with the provisions of this Agreement, then by such
Mortgagee under such other agreement) upon any sale or other disposition of the
Assets, together with all other moneys received by the Collateral Agent
hereunder, shall be applied as follows:

 

(i)            first, to the payment to the Collateral
Agent or the Administrative Agent an amount equal to (A) any and all sums
advanced by the Collateral Agent in order to preserve the Collateral or
preserve its security interests in the Collateral; and (B) in the event of
any proceeding for the collection or enforcement of any indebtedness,
obligations, or liabilities of any Assignor with respect to any portion of the
Secured Obligations after an Event of Default shall have occurred and be
continuing, the reasonable expenses of taking, holding, preparing for sale or
lease, selling or otherwise disposing of or realizing on the Collateral, or of
any exercise by the Collateral Agent of its rights hereunder, together with
reasonable attorneys’ fees and court costs;

 

(ii)           second, to the extent proceeds remain
after the application pursuant to the preceding clause (i), an amount equal to
the outstanding Primary Obligations shall be paid to the Secured Parties as
provided in Section 8.5(d) hereof, with each Secured Party
receiving an amount equal to such outstanding Primary Obligations or, if the
proceeds are insufficient to pay in full all such Primary Obligations, its Pro Rata
Share of the amount remaining to be distributed;

 

(iii)          third, to the extent proceeds remain
after the application pursuant to the preceding clauses (i) and (ii), an
amount equal to the outstanding Secondary Obligations shall be paid to the
Secured Parties as provided in Section 8.5(d), with each Secured
Party receiving an amount equal to its outstanding Secondary Obligations or, if
the proceeds are insufficient to pay in full all such Secondary Obligations,
its Pro Rata Share of the amount remaining to be distributed; and

 

(iv)          fourth, to the extent proceeds remain
after the application pursuant to the preceding clauses (i) through (iii),
inclusive, and following the termination of this Agreement pursuant to Section 12.2,
to the relevant Assignor or to whomever may be lawfully entitled to receive
such surplus, or as a court of competent jurisdiction may direct.

 

(b)           For purposes of this Agreement (i) ”Pro
Rata Share” shall mean, when calculating a Secured Party’s portion of any
distribution or amount, that amount (expressed as a percentage) equal to a
fraction, the numerator of which is the then unpaid amount of such Secured
Party’s Primary Obligations or Secondary Obligations, as the case may be, and
the denominator of which is the then outstanding amount of all Primary
Obligations or Secondary Obligations, as the case may be, (ii) ”Primary
Obligations” shall mean (A) in the case of the Credit Agreement
Obligations, all principal of, and interest on, all Loans (together with all
interest accrued thereon) under the Credit Agreement, and all fees, (B) in
the case of the Senior Secured Notes Obligations, all principal of, and
interest on, all Senior Secured Notes (together

 

21

 

with all interest accrued
thereon), and (C) in the case of the Secured Hedging Obligations and
Overdraft Facilities Obligations, all amounts due under the Secured Hedging
Agreements and the Overdraft Facilities Agreements (other than indemnities,
fees (including, without limitation, attorneys’ fees) and similar obligations
and liabilities) and (iii) ”Secondary Obligations” shall mean all
Obligations other than Primary Obligations.

 

(c)           If any payment to any Secured Party of
any distribution would result in overpayment to such Secured Party, such excess
amount shall instead be distributed in respect of the unpaid Primary
Obligations or Secondary Obligations, as the case may be, of the other Secured
Parties, with each Secured Party whose Primary Obligations or Secondary
Obligations, as the case may be, have not been paid in full to receive an
amount equal to such excess amount multiplied by a fraction the numerator of
which is the unpaid Primary Obligations or Secondary Obligations, as the case
may be, of such Secured Party and the denominator of which is the unpaid
Primary Obligations or Secondary Obligations, as the case may be, of all
Secured Parties entitled to such distribution.

 

(d)           All payments required to be made
hereunder shall be made (i) if to the Lenders or the Administrative Agent,
to the Administrative Agent under the Credit Agreement for the account of the
Lenders or the Administrative Agent, as the case may be, (ii) if to the
holders of the Senior Secured Notes or the Senior Secured Notes Trustee, to the
Senior Secured Notes Trustee, and (iii) if to any other Secured Party, to
the trustee, paying agent or other similar representative (each a “Representative”)
for such other Secured Party or, in the absence of such a Representative, such
applicable Secured Party.

 

(e)           For purposes of applying payments
received in accordance with this Section 8.5, the Collateral Agent
shall be entitled to rely upon (i) the Administrative Agent under the
Credit Agreement, (ii) the Senior Secured Notes Trustee and (iii) the
other applicable Secured Parties for a determination (which the Administrative
Agent, and the other Secured Parties agree (or shall agree) to provide upon
request of the Collateral Agent) of the outstanding Primary Obligations and
Secondary Obligations owed to the Administrative Agent, Lenders, holders of the
Senior Secured Notes, Senior Secured Notes Trustee or the other applicable
Representatives or Secured Parties, as the case may be.  Unless it has actual knowledge (including by
way of written notice from a Secured Party to the contrary), the Administrative
Agent, the Senior Secured Notes Trustee and each other applicable
Representative or Secured Party, in furnishing information pursuant to the
preceding sentence, and the Collateral Agent, in acting hereunder, shall be
entitled to assume that no Secondary Obligations are outstanding.

 

(f)            Each Secured Party hereby agrees that,
notwithstanding the order of filing of the financing statements evidencing the
granting of security interests hereunder or any other priority to which such Secured
Party may otherwise be entitled, (i) the proceeds of the Collateral shall
be distributed in accordance with the provisions of this Section 8.5,
(ii) the Collateral Agent shall have discretion to apply proceeds of
Collateral in such a manner as is necessary to give effect to this Section 8.5,
and (iii) any proceeds of the Collateral received by it other than from
the Collateral Agent shall be held in trust and immediately turned over to the
Collateral Agent for application in accordance with the provisions of this Section 8.5.

 

22

 

(g)           This Agreement is made with full recourse
to each Assignor and pursuant to and upon all the warranties, representations,
covenants and agreements on the part of such Assignor contained herein, in the
other Loan Documents, the Senior Secured Notes Indenture, the Senior Secured
Notes and, as applicable, the Secured Hedging Agreements, the Overdraft
Facilities Agreements and otherwise in connection herewith or therewith.

 

(h)           It is understood and agreed that the
Assignors shall remain liable to the extent of any deficiency between the
amount of the proceeds of the Collateral hereunder and the aggregate amount of
the sums referred to in clauses (i) through (iii) inclusive, of Section 8.5(a).

 

8.6          Remedies Cumulative.  Each and every right, power and remedy hereby
specifically given to the Collateral Agent shall be in addition to every other
right, power and remedy specifically given under this Agreement, the Secured
Hedging Agreements, the other Loan Documents, the Senior Secured Notes
Indenture or now or hereafter existing at law or in equity, or by statute and
each and every right, power and remedy whether specifically herein given or
otherwise existing may be exercised from time to time or simultaneously and as
often and in such order as may be deemed expedient by the Collateral
Agent.  All such rights, powers and
remedies shall be cumulative and the exercise or the beginning of the exercise
of one shall not be deemed a waiver of the right to exercise any other or
others.  No delay or omission of the
Collateral Agent in the exercise of any such right, power or remedy and no
renewal or extension of any of the Secured Obligations and no course of dealing
between the relevant Assignor and the Collateral Agent or any holder of any of
the Secured Obligations shall impair any such right, power or remedy or shall
be construed to be a waiver of any Event of Default or an acquiescence
therein.  No notice to or demand on any
Assignor in any case shall entitle it to any other or further notice or demand
in similar or other circumstances or constitute a waiver of any of the rights
of the Collateral Agent to any other or further action in any circumstances
without notice or demand.  In the event
that the Collateral Agent shall bring any suit to enforce any of its rights
hereunder and shall be entitled to judgment, then in such suit the Collateral
Agent may recover expenses, including attorneys’ fees, and the amounts thereof
shall be included in such judgment.

 

8.7          Discontinuance of Proceedings. 
In case the Collateral Agent shall have instituted any proceeding to
enforce any right, power or remedy under this Agreement by foreclosure, sale,
entry or otherwise, and such proceeding shall have been discontinued or
abandoned for any reason or shall have been determined adversely to the
Collateral Agent, then and in every such case the relevant Assignor, the
Collateral Agent and each holder of any of the Secured Obligations shall be
restored to their former positions and rights hereunder with respect to the
Collateral subject to the security interests created under this Agreement, and
all rights, remedies and powers of the Collateral Agent shall continue as if no
such proceeding had been instituted.

 

8.8          Collateral Agent’s Calculations.

 

(a)           For the purpose of determining the amount
of the Secured Obligations to be used as a basis for applying Proceeds
hereunder, promptly after the date that the Collateral Agent receives a Default
Certification, the Collateral Agent shall send a copy thereof to each
Representative, and each such recipient shall deliver to the Collateral Agent
certifications as to

 

23

 

the Secured Obligations
owed to the Secured Parties for which such Representative acts, subject to an
adjustment as a result of the provisions of Section 8.8(b).

 

(b)           The Collateral Agent may rely on the
certifications supplied by any Representative pursuant to Section 8.8(a),
and the Collateral Agent shall have no liability to any Secured Party for
actions taken in reliance on such information. 
All distributions made by the Collateral Agent pursuant to Section 8.1
and the other provisions of this Agreement shall (subject to any decree of any
court of competent jurisdiction) be final as between the Collateral Agent and
such Representative, and the Collateral Agent shall have no duty to inquire as
to the application by any Representative or Secured Party of any amounts
distributed to it.  Notwithstanding
anything else in this Agreement to the contrary, upon a determination by a
court of competent jurisdiction (including any court having jurisdiction in any
proceeding against any Assignor under the Bankruptcy Code) as to any
distributions payable to any Representative or Secured Party, any and all
subsequent distributions with respect to such Secured Party shall be made in
accordance therewith.  If, at any time,
the Collateral Agent reasonably determines in its sole discretion that an
allocation or distribution previously made pursuant to Section 8.1
or any other provisions of this Agreement was based on a mistake of fact, the
Collateral Agent may in its discretion, but shall not be obligated to, adjust
subsequent allocations and distributions thereunder so that, on a cumulative
basis, the Representative or Secured Parties receive the distributions to which
they would have been entitled if such mistake of fact had not been made.

 

(c)           Any amounts held by the Collateral Agent
from time to time hereunder shall be invested in Cash or Cash Equivalents.

 

8.9          Adjustments. 
Solely for the purpose of determining any allocation being made pursuant
to Section 8.1, any Proceeds previously allocated but not
distributed until the distribution that is the subject of the allocation has been
effected shall be deducted from the amount of the unpaid Secured Obligations in
respect of which such Proceeds previously allocated but not distributed are
allocated.  In the event the Collateral
Agent is unable to distribute any Proceeds, such Proceeds not distributed shall
be held in trust for the benefit of the Person entitled to distribution thereof
until the termination of this Agreement under Section 12.2, at
which time the Collateral Agent shall give notice to such Person that Proceeds
allocated to such Person remain in the custody of the Collateral Agent, and if
such Person thereafter fails to request a distribution of such Proceeds within
one hundred twenty (120) days after receipt by such Person of such notice, the
Collateral Agent shall distribute all such Proceeds to the applicable Assignor.

 

8.10        Sharing Arrangements.

 

(a)           The Secured Parties agree that the
provisions of this Agreement with respect to allocations and distributions of
Proceeds to the Secured Parties shall prevail notwithstanding any event or
circumstance, including, without limitation, in the event that, through the
operation of any bankruptcy, reorganization, insolvency or other laws or
otherwise, the Collateral Agent’s security interest in the Assets or the
Collateral is avoided in whole or in part or is enforced with respect to some,
but not all of the Secured Obligations then outstanding.

 

24

 

(b)           In furtherance of the foregoing, the
Secured Parties agree that none of them shall be entitled to benefit from any
avoidance action affecting or otherwise relating to any distribution or
allocation otherwise payable to another Secured Party (but for the effect of
such avoidance action) in accordance with this Article VIII
(including any Section hereof) or any other provisions of this Agreement,
whether by preference or otherwise, it being understood and agreed that the
benefit of any such avoidance action otherwise allocable to them shall instead
be allocated and turned over to such other Secured Party.

 

ARTICLE IX

 

INDEMNITY

 

9.1          Indemnity.

 

(a)           Each Assignor, jointly and severally,
will indemnify and hold harmless the Collateral Agent, and each Secured Party
and each director, officer, employee, partner, advisor, agent, attorney,
trustee and Affiliate of the Collateral Agent, and each Secured Party (each
such Person an “Indemnified Party”) from and against all losses, claims,
damages, penalties, obligations (including removal or remedial actions),
expenses or liabilities which arise out of, in any way relate to, or result
from the transactions contemplated by this Agreement, any of the other Loan
Documents, the Senior Secured Notes Indenture or the Senior Secured Notes or in
any other way connected with the administration of the transactions
contemplated hereby or thereby or the enforcement of any of the terms of, or
the preservation of any rights thereof, or in any way relating to or arising
out of the manufacture, ownership, ordering, purchase, delivery, control,
acceptance, lease, financing, possession, operation, condition, sale, return or
other disposition, or use of the Collateral (including, without limitation,
latent or other defects, whether or not discoverable), any contract claim or,
to the maximum extent permitted under applicable law, the violation of the laws
of any country, state or other governmental body or unit, or any tort
(including, without limitation, claims arising or imposed under the doctrine of
strict liability, or for or on account of injury to or the death of any Person
(including any Indemnitee), or property damage) and to reimburse each
Indemnified Party upon their demand, for any Attorney Costs incurred in
connection with investigating, preparing to defend or defending any such loss,
claim, damage, liability, action or claim; provided, however,
that no Indemnified Party shall have the right to be so indemnified hereunder
for any loss, claim, damage, penalties, obligations, expense or liability to
the extent it arises or results from the gross negligence or willful misconduct
or bad faith of such Indemnified Party as finally determined by a court of
competent jurisdiction.  If any action, suit
or proceeding arising from any of the foregoing is brought against the
Collateral Agent, any Secured Party or any other Indemnified Party, the
Assignors will, if requested by the Collateral Agent, any Secured Party or any
such Indemnified Party, resist and defend such action, suit or proceeding or
cause the same to be resisted and defended by counsel reasonably satisfactory
to the Person or Persons indemnified or intended to be indemnified.  Each Indemnified Party shall, unless the
Collateral Agent, a Secured Party or other Indemnified Party has made the
request described in the preceding sentence and such request has been complied
with, have the right to employ its own counsel (or (but not as well as) staff
counsel) to investigate and control the defense of any matter covered by such
indemnity and the reasonable fees and expenses of such counsel shall be at the
expense of the indemnifying party. 
Excluding any liability to the extent arising out of the gross
negligence, willful

 

25

 

misconduct or bad faith
of any Indemnified Party as finally determined by a court of competent
jurisdiction, the Assignors further, jointly and severally, agree to indemnify
and hold each Indemnified Party harmless from all loss, cost (including
Attorney Costs), liability and damage whatsoever incurred by any Indemnified
Party by reason of any violation of any Environmental Laws or Environmental
Permits or for the Release or threatened Release of any Contaminants into the
environment for which any Assignor has any liability or which occurs upon the
Mortgaged Property or which is related to any property currently or formerly
owned, leased or operated by or on behalf of any Assignor, or by reason of the
imposition of any Environmental Lien in respect of the property of any Assignor
or which occurs by a breach of any of the representations, warranties or
covenants relating to environmental matters contained herein, provided that,
with respect to any liabilities arising from acts or failure to act for which
any Assignor is strictly liable under any Environmental Law or Environmental
Permit, the Assignors’ obligation to each Indemnified Party under this
indemnity shall likewise be without regard to fault on the part of any
Assignor.  If any Assignor shall fail to
do any act or thing which it has covenanted to do hereunder or any
representation or warranty on the part of any Assignor contained herein or in
any other Loan Document shall be breached, the Collateral Agent may (but shall
not be obligated to) do the same or cause it to be done or remedy any such
breach, and may expend its funds for such purpose, and will use its best
efforts to give prompt written notice to the Borrower that it proposes to take
such action.  Any and all amounts so
expended by the Collateral Agent shall be repaid to it by the Assignors
promptly upon the Collateral Agent’s demand therefor, with interest at the
Default Rate in effect from time to time during the period including the date
so expended by the Collateral Agent to the date of repayment.  To the extent that the undertaking to
indemnify, pay or hold harmless the Collateral Agent or any Secured Party as
set forth in this Section 9.1 may be unenforceable because it is
violative of any law or public policy, the Assignors shall make the maximum contribution
to the payment and satisfaction of each of the indemnified liabilities which is
permissible under applicable law.  Except
as specifically provided for in the Loan Documents, no party hereto shall be
entitled to recover from any other party hereto any amount in respect of
exemplary, punitive, special, indirect, remote, or speculative damages,
including lost profits.

 

(b)           If the Collateral Agent has been
requested or instructed pursuant to this Agreement or any Loan Document to
take, or to refrain from taking, any action pursuant to this Agreement or any
Loan Document, (i) each Assignor agrees to, and (ii) the Secured
Parties ratably in accordance with the amount of the Secured Obligations owing
to them and with respect to which they have a security interest, if the
Instructing Group has made such request or given such instruction, agree to,
and hereby do indemnify and hold harmless the Collateral Agent to the fullest
extent permitted by applicable law, from and against any and all liability,
loss, costs, damages, attorneys’ fees, fines, claims, judgments, amounts paid
in settlement in connection with any threatened, pending or completed claim,
action, suit, proceeding or investigation, whether criminal, civil or
administrative, and expenses of whatever kind or nature which the Collateral
Agent may sustain or incur by reason of or in connection with the Collateral
Agent’s acting or refraining to act in accordance with such request or
instruction other than sustained or incurred by reason of the Collateral Agent’s
gross negligence, willful misconduct or bad faith; provided that the
obligations of the Secured Parties under this Section 9.1(b) shall
become enforceable against them if and only if and to the extent that (x) the
Assignors fail to pay the obligations arising under this Section 9.1(b) in
accordance with the terms hereof and of the

 

26

 

Mortgages and (y) the
unallocated Proceeds from the Collateral are insufficient to pay the
obligations arising under this Section 9.1(b).

 

(c)           Without limiting the application of Section 9.1(a) hereof,
each Assignor agrees, jointly and severally, to pay, or reimburse the
Collateral Agent for any and all reasonable fees, costs and expenses of
whatever kind or nature incurred in connection with the creation, preservation
or protection of the Collateral Agent’s Liens on, and security interests in,
the Collateral, including, without limitation, all reasonable fees and taxes in
connection with the recording or filing of instruments and documents in public
offices, payment or discharge of any taxes or Liens upon or in respect of the
Collateral, premiums for insurance with respect to the Collateral and all other
reasonable fees, costs and expenses in connection with protecting, maintaining
or preserving the Collateral and the Collateral Agent’s interests therein,
whether through judicial proceedings or otherwise, or in defending or
prosecuting any actions, suits or proceedings arising out of or relating to the
Collateral.

 

(d)           Without limiting the application of Section 9.1(a) hereof,
each Assignor agrees, jointly and severally, to pay, indemnify and hold each
Indemnitee harmless from and against any loss, costs, damages and expenses
which such Indemnitee may suffer, expend or incur in consequence of or growing
out of any misrepresentation by any Assignor in any Hedging Agreement or any
Overdraft Facilities Agreement or in any writing contemplated by or made or
delivered pursuant to or in connection with any Hedging Agreement or any
Overdraft Facilities.

 

9.2          Indemnity Obligations Secured by
Collateral; Survival.  Any amounts
paid by any Indemnitee as to which such Indemnitee has the right to
reimbursement shall constitute Obligations secured by the Collateral prior to
the release of the Collateral pursuant to the terms hereof.  The indemnity obligations of each Assignor
contained in this Article IX shall continue in full force and
effect notwithstanding the full payment of all the Loans under the Credit
Agreement, the full payment of the Senior Secured Notes, the termination of all
Secured Hedging Agreements, the termination and payment in full of the
Overdraft Facilities and the payment of all other Obligations and
notwithstanding the discharge thereof or any other termination of this
Agreement and the Mortgages, including pursuant to Section 12.2
and, as to any Collateral Agent, the resignation or removal thereof.

 

ARTICLE X

 

OTHER
AGREEMENTS WITH COLLATERAL AGENT

 

10.1        Compensation and Expenses.

 

(a)           The Assignors, jointly and severally,
hereby agree to pay to the Collateral Agent, upon acceptance by the Collateral
Agent of the obligations created by this Agreement and thereafter until all
Proceeds are distributed and the security interests created by this Agreement
are terminated, from time to time, upon demand, all of the reasonable costs and
expenses of the Collateral Agent (including the reasonable fees and
disbursements of its counsel and such special counsel as the Collateral Agent
reasonably elects to retain) (i) arising in connection with

 

27

 

the preparation,
execution, delivery, modification, restatement, amendment or termination of
this Agreement, each Mortgage and each Security Document or the enforcement
(whether in the context of a civil action, adversary proceeding, bankruptcy,
workout or otherwise) of any of the provisions hereof or thereof or (ii) incurred
or required to be advanced in connection with the preservation, protection,
realization on or defense of the Assets, the Collateral and of the Collateral
Agent’s rights hereunder and under the Mortgages and the Security Documents,
and in and to the Assets and the Collateral (collectively, the “Collateral
Agent Costs”).  The Collateral Agent’s
compensation shall not be limited by any law relating to compensation of a
collateral agent.  The obligations of the
Assignors under this Section 10.2 shall survive the termination of
the other provisions of this Agreement and the Mortgages.

 

(b)           When the Collateral Agent incurs expenses
or renders services after an order for relief with respect to any Assignor
shall have been entered under any applicable bankruptcy, insolvency or other
similar law, the expense and the compensation for the Collateral Agent’s
services are intended to constitute expenses of administration under any
bankruptcy law.

 

10.2        Stamp and Other Taxes. 
Each Assignor agrees to indemnify and hold harmless the Collateral Agent
and each Secured Party from and against any present or future claim for
liability for any stamp or other similar tax (other than taxes described in
clauses (i) through (vi) of Section 4.7(a) of the Credit
Agreement) and any penalties or interest with respect thereto which may be
assessed, levied or collected by any jurisdiction in connection with this
Agreement, any Mortgage and all other Security Documents or the attachment or
perfection of the security interests granted by such Assignor in any Assets or
Collateral, the Mortgaged Property and all collateral under any and all other
Security Documents.  The obligations of
the Assignors under this Section 10.2 shall survive the termination
of the other provisions of this Agreement, the Mortgages and the other Security
Documents.

 

10.3        Filing Fees, Excise Taxes, Etc.  Each Assignor agrees to pay or to reimburse the
Collateral Agent and each Secured Party for any and all amounts in respect of
all (i) search, filing, recording and registration fees, and (ii) taxes,
excise taxes, sales taxes and other similar imposts (other than taxes described
in clauses (i) through (vi) of Section 4.7(a) of the Credit
Agreement), in each case, which may be payable or determined to be payable in
respect of the execution, delivery, performance and enforcement of this
Agreement and each Mortgage and the other Security Documents and agrees to save
the Collateral Agent and each Secured Party harmless from and against any and
all liabilities with respect to or resulting from any delay in paying or
omission to pay such taxes and fees.  The
obligations of the Assignors under this Section 10.3 shall survive
the termination of the other provisions of this Agreement, the Mortgages and
the other Security Documents.

 

ARTICLE XI

 

THE
COLLATERAL AGENT

 

11.1        Appointment of the Collateral Agent. 
Each of the Secured Parties by its acceptance of the benefits hereof,
hereby appoints Deutsche Bank AG New York Branch to serve as the Collateral
Agent for such Person and authorizes the Collateral Agent to act as agent for
such Person, subject to the provisions of this Agreement, for the purpose of
enforcing the

 

28

 

Secured Parties’
respective rights in the Assets and the Collateral and the obligations of the
Assignors hereunder and under the other Loan Documents to which any of the
Assignors is a party.

 

11.2        Acceptance of Appointment. 
Deutsche Bank AG New York Branch, for itself and its successors, hereby
accepts its appointment as Collateral Agent upon the terms and conditions
hereof, including those contained in Articles IX, X and XI.

 

11.3        Further Assurances.  Each Secured
Party agrees to execute, from time to time, further instruments and documents
and to take, from time to time, all further action to evidence that the Secured
Obligations owed to such Secured Party have been fully paid and satisfied and
any commitments in respect thereof have been terminated, and as to any other
matters that may be necessary or reasonably requested in writing by the
Collateral Agent, in order to carry out or give effect to the provisions of
this Agreement.  The Collateral Agent
shall be entitled to conclusively rely on any such instruments, documents or
information believed by it in good faith to be genuine and duly authorized.

 

11.4        Exculpatory Provisions.

 

(a)           The Collateral Agent shall not be
responsible in any manner whatsoever for the correctness of any recitals,
statements, representations or warranties contained herein or in the Mortgages
or in any other Security Document. The Collateral Agent makes no
representations as to the value or condition of the Collateral or Assets or any
part thereof, or as to the title of the respective Assignors thereto or as to
the security afforded by the Mortgages or this Agreement, or as to the
validity, execution (except its own execution), enforceability, legality or sufficiency
of this Agreement, any Mortgage or of the Secured Obligations, and the
Collateral Agent shall incur no liability or responsibility in respect of any
such matters.  The Collateral Agent shall
not be responsible for insuring the Assets or Collateral or for the payment of
taxes, charges, assessments or liens upon the Assets or Collateral or otherwise
as to the maintenance of the Assets or Collateral, except that (i) in the
event the Collateral Agent enters into possession of a part or all of the Assets
or Collateral, the Collateral Agent shall preserve the part in its possession
and (ii) the Collateral Agent will promptly, and at its own expense, take
such action as may be necessary to duly remove and discharge (by bonding or
otherwise) any lien on any part of the Collateral resulting from claims against
it (whether individually or as Collateral Agent, as the case may be) not
related to the administration of the Collateral or (if so related) resulting
from negligence or willful misconduct on its part.

 

(b)           The Collateral Agent shall not be
required to ascertain or inquire as to the performance by any Assignor of any
of the covenants or agreements contained herein, in any Mortgage or in any Debt
Instrument.  Whenever it is necessary, or
in the opinion of the Collateral Agent advisable, for the Collateral Agent to
ascertain the amount of, or whether the term “Fully Paid” applies to, any
Secured Obligations, the Collateral Agent may rely on a certificate of the
respective Secured Party or Representative with respect thereto.  Each Secured Party and each Representative
agrees to provide any such certificate so requested by the Collateral Agent, to
the extent such information is contained on the books and records of the party
requested to deliver such certificate, and to notify the Collateral Agent when
those Secured Obligations owed to it are Fully Paid.

 

29

 

(c)           Beyond its duties set forth in this
Agreement and as may be required by law as to the custody of the Assets or
Collateral and the accounting to each Assignor and the Secured Parties for
moneys received by it hereunder, the Collateral Agent shall have no duty to any
Assignor or to the Secured Parties as to any of the Assets or Collateral in its
possession or control or in the possession or control of any agent or nominee
of it or any income thereof or as to the preservation of rights against prior
parties or any other rights pertaining thereto, except as required by
Requirements of Law.  To the extent,
however, that the Collateral Agent or an agent or nominee of the Collateral
Agent maintains possession or control of any of the Assets or Collateral at any
office of any Assignor, the Collateral Agent shall, or shall instruct such
agent or nominee to, grant such Assignor access to (but not possession of) such
Assets that such Assignor requires for the normal conduct of its business,
which right of access may be revoked by the Collateral Agent at any time an
Event of Default has occurred and is continuing.

 

11.5        Delegation of Duties.  The Collateral Agent may execute any of the powers
hereof and perform any duty hereunder either directly or by or through agents,
nominees or attorneys-in-fact.  The
Collateral Agent shall be entitled to advice of counsel concerning all matters
pertaining to such powers and duties. 
The Collateral Agent shall not be responsible for the negligence or
misconduct of any agents, nominees or attorneys-in-fact selected by it without
gross negligence or willful misconduct.

 

11.6        Reliance by Collateral Agent.

 

(a)           Whenever in the administration of this
Agreement or the Collateral of or security provided by this Agreement the
Collateral Agent shall deem it necessary or desirable that a matter be proved
or established with respect to any Assignor in connection with the taking,
suffering or omitting of any action hereunder by the Collateral Agent, such
matter (unless other evidence in respect thereof be herein specifically
prescribed) may be deemed to be conclusively provided or established by a certificate
of a Responsible Officer of such Assignor.

 

(b)           The Collateral Agent may rely, and shall
be fully protected in acting, upon any resolution, statement, certificate,
instrument, opinion, report, notice, request, consent, order, bond or other
paper or document which it believes in good faith to be genuine and to have
been signed or presented by the proper party or parties or, in the case of
telecopies, to have been sent by the proper party or parties.  In the absence of its gross negligence or
willful misconduct, the Collateral Agent may conclusively rely, as to the truth
of the statements and the correctness of the opinions expressed therein, upon
any certificates or opinions furnished to the Collateral Agent and conforming
to the requirements of this Agreement or any Mortgage or as set forth on such
Person’s books and records.

 

(c)           If the Collateral Agent has been
requested to take any action pursuant to this Agreement, any Mortgage or any
other Security Document, the Collateral Agent shall not be under any obligation
to exercise any of the rights or powers vested in the Collateral Agent by this
Agreement or any Mortgage unless the Collateral Agent shall have been provided,
by the party making such request, adequate security against the costs, expenses
and liabilities which may be incurred by it in compliance with such request or
direction, including such reasonable advances as may be requested by the
Collateral Agent.

 

30

 

11.7        Limitations on Duties of the Collateral Agent.

 

(a)           The Collateral Agent shall be obliged to
perform such duties and only such duties as are specifically set forth in this
Agreement or in any Mortgage or any other Security Document.  The Collateral Agent shall not be required to
give any consent or take any discretionary action hereunder or under any
Mortgage unless the Collateral Agent has received written instructions from the
Instructing Group, and no implied covenants or obligations shall be read into
this Agreement or any Mortgage against the Collateral Agent.

 

(b)           The Collateral Agent shall furnish to the
Secured Parties promptly upon receipt thereof a copy of each material
certificate or other paper furnished to the Collateral Agent by any Assignor
under, in respect of or pursuant to this Agreement, any Mortgage or any of the
Collateral, unless by the terms hereof or of any Mortgage or other Security
Document, a copy of the same is required to be furnished by some other Person
directly to the Secured Parties, or the Collateral Agent shall have determined
that the same has already been so furnished. 
The Collateral Agent agrees to hold in strict confidence all non-public
information obtained from any Assignor, pursuant to this Section 11.7,
except to the extent that disclosure is permitted hereunder, may be permitted
under the Mortgage, the Debt Instruments or is required by law or by any
Governmental Authority (in which event the Collateral Agent will promptly
provide the applicable Assignor with notice of such disclosure unless
prohibited from doing so by such Governmental Authority).

 

11.8        Assets to Be Held in Trust.  All Assets received by the Collateral Agent under or
pursuant to any provision of this Agreement or any Mortgage shall be held in
trust for the benefit of the Secured Parties for the purposes for which they
were paid or are held, but Assets and Collateral, including Proceeds, need not
be segregated from other property held by the Collateral Agent except to the
extent required by law or as necessary to preserve the Liens with respect to
the Assets and Collateral.  The
Collateral Agent shall have no liability for interest on any money received by
the Collateral Agent hereunder except to the extent actually received by it
from time to time from investments made in accordance with the provisions
hereof, the Mortgages or any other Security Document.

 

11.9        Resignation and Removal of the Collateral Agent.

 

(a)           The Collateral Agent may at any time, by
giving thirty (30) days’ prior written notice, resign and be discharged of the
responsibilities hereby created, such resignation to become effective upon the
appointment of a successor agent or agents with the Company’s consent (such
consent not to be unreasonably withheld or delayed) and the acceptance of such
appointment by such successor agent or agents. 
The appointment of a successor agent or agents shall be within the
discretion of the Instructing Group.  The
Collateral Agent may be removed at any time and a successor agent appointed by
the Instructing Group; provided that the Collateral Agent shall be
entitled to its fees and expenses to the date of removal.  If no agent or agents shall be appointed and
approved within thirty (30) days from the date of the giving of the aforesaid
notice of resignation or within (30) days from the date of such removal, the
Collateral Agent shall, or the Instructing Group may, apply to any court of
competent jurisdiction to appoint a successor agent or agents to act until such
time, if any, as a successor agent or agents shall have been appointed as above
provided.  Any successor agent or agents
so appointed by such court

 

31

 

shall immediately and
without further act be superseded by any successor agent or agents appointed by
the Instructing Group as above provided.

 

(b)           If at any time the Collateral Agent shall
become incapable of acting, or if at any time a vacancy shall occur in the
office of the Collateral Agent for any other cause, a successor agent or agents
may be appointed by the Instructing Group with the Company’s consent (such
consent not to be unreasonably withheld or delayed), and the powers, duties,
authority and title of the predecessor agent or agents terminated and canceled
without procuring the resignation of such predecessor agent or agents, and
without any formality (except as may be required by applicable law) other than
the appointment and designation of a successor agent or agents in writing, duly
acknowledged, delivered to the predecessor agent or agents, and filed for record
in each public office, if any, in which this Agreement is required to be
filed.  If no agent or agents shall be
appointed and approved within thirty (30) days from the date the Collateral
Agent becomes incapable of acting or a vacancy shall occur in the office of
Collateral Agent, any Assignor or any Secured Party may apply to any court of
competent jurisdiction to appoint a successor agent or agents to act until such
time, if any, as a successor agent or agents shall have been appointed as above
provided.  Any successor agent or agents
so appointed by such court shall immediately and without further act be
superseded by any successor agent or agents approved by the Instructing Group
as above provided.

 

(c)           The appointment and designation referred
to in Section 11.9(a) or 11.9(b) shall, after any
required filing, be full evidence of the right and authority to make the same
and of all the facts therein recited, and this Agreement shall vest in such
successor agent or agents, without any further act, deed or conveyance, all of
the estate and title of its predecessor or their predecessors, and upon such
filing for record the successor agent or agents shall become fully vested with
all the estates, properties, rights, powers, trusts, duties, authority and
title of its predecessor or their predecessors; but such predecessor or
predecessors shall, nevertheless, on the written request of the Instructing
Group, or its or their successor agent or agents, execute and deliver an
instrument transferring to such successor or successors all the estates,
properties, rights, powers, trusts, duties, authority and title of such
predecessor or predecessors hereunder and shall deliver all securities and
moneys held by it or them to such successor agent or agents.  Should any deed, conveyance or other
instrument in writing from any Assignor or from the Secured Parties, as
applicable, be required by any successor agent or agents for more fully and
certainly vesting in such successor agent or agents the estates, properties,
rights, powers, trusts, duties, authority and title vested or intended to be
vested in the predecessor agent or agents, any and all such deeds, conveyances
and other instruments in writing shall, on request of such successor agent or
agents, be executed, acknowledged and delivered by such Assignor and the
Secured Parties, as applicable.

 

(d)           Any required filing for record of the
instrument appointing a successor agent or agents as hereinabove provided shall
be at the joint and several expense of the Assignors.  The resignation of any agent or agents and
the instrument or instruments removing any agent or agents, together with all
other instruments, deeds and conveyances provided for in this Article XI
shall, if required by law, be forthwith recorded, registered and filed by and
at the joint and several expense of the Assignors, wherever this Agreement is
recorded, registered and filed.

 

32

 

(e)           The Collateral Agent’s obligations
hereunder are limited to the extent set forth in Section 12.15 of the
Credit Agreement.

 

11.10      Status of Successors to the Collateral Agent. 
Every successor to the Collateral Agent appointed pursuant to Section 11.9
and every co-agent appointed pursuant to Section 11.9 shall be a
bank or trust company in good standing and having power so to act, incorporated
under the laws of the United States or any state thereof or the District of
Columbia, and having its principal corporate trust office within the
forty-eight (48) contiguous states or the District of Columbia and shall also
have capital, surplus and undivided profits of not less than FOUR HUNDRED
MILLION DOLLARS ($400,000,000).

 

11.11      Merger of the Collateral Agent.  Any corporation into which the Collateral Agent shall
be merged, or with which it shall be consolidated, or any corporation resulting
from any merger or consolidation to which the Collateral Agent shall be a
party, shall be the Collateral Agent under this Agreement without the execution
or filing of any paper or any further act on the part of the parties hereto.

 

11.12      Additional Co-Agents; Separate Agents.

 

(a)           If at any time or times it shall be
necessary or prudent in order to conform to any law of any jurisdiction in
which any of the Collateral shall be located, or the Collateral Agent shall be
advised by counsel, satisfactory to it, that it is so necessary or prudent in
the interest of the Secured Parties or the Instructing Group shall in writing
so request, or the Collateral Agent shall deem it desirable for its own
protection in the performance of its duties hereunder, the Collateral Agent,
each Assignor shall execute and deliver all instruments and agreements
necessary or proper to constitute another bank or trust company, or one or more
Persons approved by the Collateral Agent and the Instructing Group either to
act as co-agent or co-agents of all or any of the Collateral, jointly with the
Collateral Agent originally named herein or any successor or successors, or to
act as separate agent or agents of any such property.

 

(b)           Every separate agent and every co-agent,
other than any agent which may be appointed as successor to the Collateral
Agent, shall, to the extent permitted by law, be appointed and act and be such,
subject to the following provisions and conditions, namely:

 

(i)            all rights, powers, duties and
obligations conferred upon the Collateral Agent in respect of the custody,
control and management of moneys, papers or securities shall be exercised
solely by the Collateral Agent, or its successors as the Collateral Agent hereunder;

 

(ii)           all rights, powers, duties and
obligations conferred or imposed upon the Collateral Agent hereunder shall be
conferred or imposed and exercised or performed by the Collateral Agent and
such separate agent or separate agents or co-agent or co-agents, except to the
extent that under any law of any jurisdiction in which any particular act or
acts are to be performed the Collateral Agent shall be incompetent or
unqualified to perform such act or acts, in which event such rights, powers,
duties and obligations shall be exercised and performed by such separate agent
or separate agents or co-agent or co-agents;

 

33

 

(iii)          notwithstanding anything to the contrary
contained herein, no power given or provided hereby to any such co-agent or
co-agents or separate agents may be exercised by it or them, except jointly
with, or with the consent in writing of, the Collateral Agent;

 

(iv)          no agent hereunder shall be personally
liable by reason of any act or omission of any other agent hereunder; and

 

(v)           the Collateral Agent, at any time by an
instrument in writing, executed by the Collateral Agent, may accept for itself
and on behalf of the Secured Parties the resignation of or remove any such
separate agent or co-agent, and in that case, by an instrument in writing
executed by the Collateral Agent, may appoint a successor to such separate
agent or co-agent, as the case may be, anything herein contained to the
contrary notwithstanding.  The Secured
Parties hereby irrevocably appoint the Collateral Agent, their agent and
attorney to act for them in respect of such separate agent or co-agent or
separate agents or co-agents as above provided.

 

11.13      Collateral Agent as UK Security Trustee.

 

(a)           In this Agreement, any rights and
remedies exercisable by, any documents to be delivered to, or any other
indemnities or obligations in favor of the Collateral Agent shall be, as the
case may be, exercisable by, delivered to, or be indemnities or other
obligations in favor of, the Collateral Agent (or any other Person acting in
such capacity) in its capacity as the UK Security Trustee to the extent that
the rights, deliveries, indemnities or other obligations relate to the UK
Security Documents or the security thereby created.  Any obligations of the Collateral Agent (or
any other Person acting in such capacity) in this Agreement shall be
obligations of the Collateral Agent in its capacity as UK Security Trustee to
the extent that the obligations relate to the UK Security Documents or the
security thereby created.  Additionally,
in its capacity as UK Security Trustee, the Collateral Agent (or any other
Person acting in such capacity) shall have (i) all the rights, remedies
and benefits in favor of the Collateral Agent contained in the provisions of
the whole of this Article XI; (ii) all the powers of an
absolute owner of the security constituted by the UK Security Documents and (iii) all
the rights, remedies and powers granted to it and be subject to all the
obligations and duties owed by it under the UK Security Documents and/or any of
the Loan Documents.

 

(b)           Each Lender and the Collateral Agent
hereby appoint the UK Security Trustee to act as its trustee under and in
relation to the UK Security Documents and to hold the assets subject to the
security thereby created as trustee for itself and other Secured Parties on the
trusts and other terms contained in the UK Security Documents and each Secured
Party hereby irrevocably authorizes the UK Security Trustee to exercise such
rights, remedies, powers and discretions as are specifically delegated to the
UK Security Trustee by the terms of the UK Security Documents together with all
such rights, remedies, powers and discretions as are reasonably incidental
thereto.

 

(c)           Any reference in this Agreement to Liens
stated to be in favor of the Collateral Agent shall be construed so as to
include a reference to Liens granted in favor of the UK Security Trustee.

 

34

 

(d)           The Lenders agree that at any time that
the UK Security Trustee shall be a Person other than the Collateral Agent, such
other Person shall have the rights, remedies, benefits and powers granted to
the Collateral Agent in its capacity as the UK Security Trustee in this
Agreement.

 

(e)           Nothing in this Section 11.13
shall require the UK Security Trustee to act as a trustee at common law or to
be holding any property on trust, in any jurisdiction outside the United States
or the United Kingdom which may not operate under principles of trust or where
such trust would not be recognized or its effects would not be enforceable.

 

ARTICLE XII

 

TERMINATION;
RELEASES OF COLLATERAL

 

12.1        Release of Certain Security.  Subject to the provisions of Section 12.15 of the
Credit Agreement, upon receipt by the Collateral Agent from time to time of a
request from an Assignor for the release of any specific portion of the
Collateral or the Liens in any Collateral granted by such Assignor pursuant to
any Security Document (including, without limitation, Liens on Collateral being
sold in accordance with the Credit Agreement), and upon the concurrence of the
Administrative Agent under the Credit Agreement that such release is required
or permitted under the terms of the Credit Agreement, the Collateral Agent shall
release all right, title and interest of the Collateral Agent, as the case may
be, in, to and under such Collateral, and the Liens of the Collateral Agent
therein shall automatically terminate and shall revert to the applicable
Assignor. Following such termination or release, the Collateral Agent shall,
upon the written request of such Assignor, or upon the written request or
instructions of the Instructing Group, execute such instruments and take such
other actions as are necessary or desirable to terminate Liens and otherwise
effectuate and evidence the release of the specified portions of the Collateral
(including, without limitation, delivering to the respective Assignor all
Collateral in the possession of the Collateral Agent).  Any such delivery shall be without warranty
of, or recourse to, the Collateral Agent, other than a representation that
there are no Liens on such property attributable to the Collateral Agent.  Such termination and release shall be without
prejudice to the rights of the Collateral Agent to charge and be reimbursed for
any expenditure which it may thereafter incur in connection therewith.

 

12.2        Termination Upon Satisfaction. 
Upon receipt by the Collateral Agent of evidence satisfactory to it that
all Credit Agreement Obligations are Fully Paid, and either (a) all Senior
Secured Notes Obligations are Fully Paid or (b) no Default or Event of
Default (as defined in the Senior Secured Notes Indenture) has occurred and is
continuing (and has not been waived) under the Senior Secured Notes Indenture,
this Agreement shall (except with respect to any provisions which expressly
survive such termination) terminate and all right, title and interest of the
Collateral Agent in, to and under the Collateral and the Liens of the
Collateral Agent therein including without limitation any Liens on Collateral
securing the Senior Secured Notes Obligations) shall automatically be released
and terminated and shall revert to the respective Assignors and the Collateral
Agent shall have no further obligations hereunder.  In such event, the Collateral Agent, at the
request and expense of the Assignors, will execute and deliver to the
Assignors, a proper instrument or instruments acknowledging the satisfaction
and

 

35

 

termination of this
Agreement, and will duly assign, transfer and deliver to the respective
Assignors all of the Collateral held by the Collateral Agent hereunder.  Such termination and release shall be without
prejudice to the right of the Collateral Agent to charge and be reimbursed for
any expenditure which it might thereafter incur in connection therewith.  As used in this Agreement, the term “Termination
Date” shall mean the date upon which this Agreement shall have terminated
in accordance with the first sentence of this Section 12.2.

 

ARTICLE XIII

 

LIMITED
RIGHTS OF SECURED PARTIES; PROOFS OF CLAIM

 

13.1        Limited Rights of Secured Parties. 
The Secured Parties by their acceptance of the benefits hereof agree
that the only right a Secured Party has under this Agreement is for the Secured
Obligations to be secured by the Assets or Collateral pledged for the period
and to the extent provided for in the Mortgages and this Agreement, and to have
Proceeds, if any, distributed to the Secured Parties for the benefit of the
Secured Parties to the extent, at the times and as provided in Section 8.5.  Each of the Secured Parties by their
acceptance of the benefits hereof acknowledges and agrees that it shall have no
right to individually direct the Collateral Agent to take or refrain from
taking any action hereunder, under any mortgage or under any other security
document or with respect to any Assets or Collateral and that all rights with
respect thereto shall be vested solely in the Collateral Agent or the
Collateral Agent acting at the direction of the Instructing Group.

 

13.2        Filing of Claims.  Upon the
written request of all or any of the Secured Parties, the Collateral Agent may
file such proofs of claim and other papers or documents as may be necessary or
advisable in order to have the claims of the Secured Parties making such
request allowed in any judicial proceedings relating to any Assignor, its
creditors or its property.  However,
nothing herein contained shall prevent any Secured Party from filing such
proofs of claim and other papers or documents as may be determined by the
Secured Party in order to have the claims of such Secured Party allowed in any
judicial proceedings relating to any Assignor. 
The Collateral Agent may file such proofs of claims and other papers or
documents as may be necessary or advisable in order to have the claims of the
Collateral Agent, its agents and counsel allowed in any judicial proceedings
relating to any Assignor (or any other obligor under the Secured Obligations),
its creditors or its property; provided that the rights described in this
sentence shall relate only to claims relating to the Collateral Agent Costs and
the fees and expenses of the Collateral Agent’s agents and counsel in their
respective individual capacities under this Agreement and the Mortgages.

 

13.3        Collection of Claims. 
The Collateral Agent shall be entitled and empowered to collect and
receive any monies or other property payable or deliverable on any such claims
filed by the Collateral Agent pursuant to Section 13.2 and to
distribute the same in accordance with the parties’ legal rights, and any
custodian in any such judicial proceedings is hereby authorized by each Secured
Party to make such payments to the Collateral Agent and, in the event that the
Collateral Agent shall consent to the making of such payments directly to the
Secured Parties, to pay to the Collateral Agent any amount due to it for the
Collateral Agent Costs, and the fees and expenses of the Collateral Agent’s
agents and counsel, and any other amounts due the Collateral Agent under this
Agreement.

 

36

 

13.4        Limitations.  Nothing
herein contained shall be deemed to authorize the Collateral Agent to authorize
or consent to or accept or adopt on behalf of any Secured Party (other than any
Secured Party that is an Affiliate of Company) any plan of reorganization or
arrangement, adjustment or composition affecting the Secured Obligations or the
rights of any holder thereof, or to authorize the Collateral Agent to vote in
respect of the claim of any Secured Party in any such proceeding.

 

ARTICLE XIV

 

MISCELLANEOUS

 

14.1        Notices.  Except where
telephonic instructions or notices are authorized herein to be given, all
notices, demands, instructions and other communications required or permitted
to be given to or made upon any party hereto or any other Person shall be in
writing and shall be personally delivered or sent by registered or certified
mail, postage prepaid, return receipt requested, or by a reputable overnight or
courier delivery service, or by telecopier, and shall be deemed to be given for
purposes of this Agreement on the third day after deposit in registered or
certified mail, postage prepaid, and otherwise on the day that such writing is
delivered or sent to the intended recipient thereof, or in the case of notice
delivered by telecopy, upon completion of transmission with a copy of such
notice also being delivered under any of the methods provided above, all in
accordance with the provisions of this Section 14.1.  All notices, requests, demands or other
communications shall be in writing and addressed as follows:

 

(a)           if to any Assignor:

 

c/o Huntsman International
LLC

500 Huntsman Way

Salt Lake City, Utah 84108

Attention: General Counsel

Telephone: (801) 584-5700

Telecopy: (801) 758-9031

 

with a copy to:

 

Vinson & Elkins, L.L.P.

2300 First City Tower, 1001 Fannin

Houston, Texas 77002-6760

Attention: 
Mark Spradling

Telephone: 
(713) 758-2828

Telecopy: 
(713) 615-5545

 

37

 

(b)           if to the Collateral Agent:

 

Deutsche Bank AG New York Branch

60 Wall Street

New York, New York 10005

Attention: 
John Anos

Telephone: (212) 469-2750

Telecopy: (212) 469-3632

 

with a copy to:

 

Winston & Strawn LLP

35 West Wacker Drive

Chicago, Illinois 60601

Attention: 
Charles B. Boehrer

Telephone: (312) 558-5989

Telecopy: (312) 558-5700

 

(c)           if to the Administrative Agent, any Lender or
the Senior Secured Notes Trustee, either (A) to the Administrative Agent,
at the address of the Administrative Agent specified in the Credit Agreement, (B) at
such address as such Lender shall have specified in the Credit Agreement, or (C) to
the Senior Secured Notes Trustee, at the address of the Senior Secured Notes
Trustee specified in the Senior Secured Notes Indenture;

 

(d)           if to any other Secured Party, directly to
such Secured Party at such address as such Secured Party shall have specified
in writing to the Assignors and the Collateral Agent;

 

or
at such other address as shall have been furnished in writing by any Person
described above to the party required to give notice hereunder.

 

14.2        Waiver; Amendment.

 

(a)           None of the terms and conditions of this
Agreement may be changed, waived, modified or varied in any manner whatsoever
unless in writing duly signed by each Assignor directly affected thereby
(acting in compliance with the terms of the Credit Agreement) and the
Collateral Agent (with the written consent of (i) the Required Lenders, or
to the extent required by Section 12.1 of the Credit Agreement, all the
Lenders and (ii) the Senior Secured Notes Trustee if (x) the change,
waiver, modification or variance would materially adversely affect the rights
and benefits of the Senior Secured Notes Trustee or the holders of the Senior
Secured Notes in a different manner than the other Secured Parties or (y) the
Credit Agreement Obligations have been Fully Paid).  Notwithstanding the foregoing, any change,
waiver, modification or variance materially adversely affecting the rights and
benefits of a class of Secured Party (and not all classes of Secured Parties in
a like or similar manner) shall require the written consent of all holders of
obligations in such class of Secured Party (or, in the case of the Senior
Secured Notes, only the Senior Secured Notes Trustee).

 

38

 

(b)           The Assignors and the Collateral Agent,
at any time and from time to time, may enter into additional security documents
or one or more agreements supplemental hereto or to any Mortgage for the
purpose of subjecting additional property to a lien in favor of the Collateral
Agent for the benefit of any or all of the Secured Parties.

 

(c)           Notwithstanding the provisions of Section 14.2(a) hereof,
and without the consent of any Person, the Collateral Agent and the Assignors
may, from time to time, enter into written agreements supplemental hereto or to
the Mortgages for the purpose of (w) supplementing the information set forth in
any Schedule hereto, (x) making any ministerial or clarifying modification
to this Agreement or any Mortgage, including, but not limited to, clarifying or
correcting clerical or typographical errors in this Agreement or any Mortgage;
(y) permitting the release of the Collateral Agent’s Liens in or on any Asset (“Release
(Correction)”) that was never owned by the applicable Assignor or that was
never intended by the parties hereto to have been pledged or given as security
pursuant hereto or the Mortgages or (z) releasing Collateral from the security
interests of this Agreement pursuant to the terms hereof.  At least thirty (30) days (in such shorter
period as may be acceptable to the Collateral Agent) prior to executing any
supplemental agreement pursuant to the terms of this Section 14.2(c),
the effect of which agreement is to permit a Release (Correction), the
Collateral Agent and the Secured Parties shall be entitled to receive a
certificate (upon which the Collateral Agent may conclusively rely) from a
Responsible Officer of the respective Assignor certifying (i) that such
property was never owned by such Assignor or (ii) that such property was
never intended to have been pledged or given as security pursuant hereto or the
Mortgages.  Any such supplemental
agreement shall be binding upon each Assignor, the Secured Parties, the
Collateral Agent and their respective successors and assigns.

 

(d)           Notwithstanding the foregoing, any Person
who hereafter becomes a Domestic Subsidiary of the Company shall, in accordance
with Section 7.11(d) of the Credit Agreement become a party to this
Agreement by execution of a supplement to this Agreement in the form of Exhibit A
(with only such changes thereto as are agreed to by the Collateral Agent),
whereupon such Person shall be deemed an Assignor for all purposes hereunder.

 

(e)           Assignors may amend and supplement the
Schedules hereto to reflect changes resulting from transactions to the extent
permitted by the Credit Agreement (and the other Loan Documents) provided that (i) notice
and copies of any such amendments and supplements are provided to the
Collateral Agent and the Administrative Agent and (ii) no such amendment
or supplement shall be prohibited by the Senior Secured Notes Indenture.

 

14.3        Obligations Absolute. 
The obligations of each Assignor hereunder shall remain in full force
and effect without regard to, and shall not be impaired by, (a) any
bankruptcy, insolvency, reorganization, arrangement, readjustment, composition,
liquidation or the like of such Assignor; (b) any exercise or
non-exercise, or any waiver of, any right, remedy, power or privilege under or
in respect of this Agreement, any other Loan Document, the Senior Secured Notes
Indenture, the Senior Secured Notes or any Secured Hedging Agreement except as
specifically set forth in a waiver granted pursuant to Section 14.2
hereof; or (c) any amendment to or modification of any Loan Document, the
Senior Secured Notes Indenture, the Senior Secured Notes or any Secured Hedging
Agreement or any security for any of the Obligations, whether or not any
Assignor shall have notice or knowledge of any of the foregoing.

 

39

 

14.4        Successors and Assigns. 
This Agreement shall be binding upon the parties hereto and their
respective successors and assigns and shall inure to the benefit of the
Collateral Agent, each Secured Party and each Assignor and their respective
successors and assigns, provided that no Assignor may transfer or assign any or
all of its rights or obligations hereunder without the written consent of the
Instructing Group.

 

14.5        Headings Descriptive. 
The headings of the several sections of this Agreement are inserted for
convenience only and shall not in any way affect the meaning or construction of
any provision of this Agreement.

 

14.6        Severability.  Any provision
of this Agreement which is prohibited or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining provisions
hereof, and any such prohibition or unenforceability in any jurisdiction shall
not invalidate or render unenforceable such provision in any other
jurisdiction.

 

14.7        Conflict With Other Agreements.  The parties agree that in the event of any conflict
between the provisions of this Agreement and the provisions of any Mortgage,
the provisions of this Agreement shall control.

 

14.8        Governing Law. 
THIS
AGREEMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF
NEW YORK, AND FOR ALL PURPOSES SHALL BE CONSTRUED IN ACCORDANCE WITH THE
INTERNAL LAWS AND DECISIONS OF SAID STATE.

 

14.9        Consent to Jurisdiction and Service of Process; Waiver
of Jury Trial.

 

(A)          EACH PARTY HERETO HEREBY IRREVOCABLY SUBMITS TO THE
NONEXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR NEW YORK STATE COURT
SITTING IN THE CITY OF NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, AND HEREBY IRREVOCABLY
AGREES THAT ALL CLAIMS IN RESPECT TO SUCH ACTION OR PROCEEDING MAY BE HEARD
AND DETERMINED IN ANY SUCH UNITED STATES FEDERAL OR NEW YORK STATE COURT AND
EACH PARTY HERETO IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING, WITHOUT
LIMITATION, ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF
FORUM NON CONVENIENS WHICH ANY OF THEM MAY NOW OR HEREAFTER HAVE TO THE
BRINGING OF ANY SUCH ACTION OR PROCEEDING IN SUCH RESPECTIVE JURISDICTIONS.

 

(B)          AS A METHOD OF SERVICE, EACH PARTY HERETO IRREVOCABLY
CONSENTS TO THE SERVICE OF ANY AND ALL PROCESS IN ANY SUCH ACTION OR PROCEEDING,
BROUGHT IN ANY SUCH UNITED STATES FEDERAL OR NEW YORK STATE COURT BY THE
DELIVERY OF COPIES OF SUCH PROCESS TO THE ASSIGNORS OR THE COLLATERAL AGENT, AS
THE

 

40

 

CASE MAY BE, AT THE ADDRESSES SPECIFIED IN SECTION 14.1
OR BY CERTIFIED MAIL DIRECT TO SUCH RESPECTIVE ADDRESSES.

 

(C)          EACH PARTY HERETO HEREBY EXPRESSLY WAIVES ANY RIGHT TO A
TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHT, POWER
OR REMEDY UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT.  THE TERMS AND THE PROVISIONS
OF THIS SECTION CONSTITUTE A MATERIAL INDUCEMENT TO LENDERS ENTERING INTO
THIS AGREEMENT.

 

14.10      Assignor’s Duties. 
It is expressly agreed, anything herein contained to the contrary notwithstanding,
that each Assignor shall remain liable to perform all of the obligations, if
any, assumed by it with respect to the Collateral and the Collateral Agent
shall not have any obligations or liabilities with respect to any Collateral by
reason of or arising out of this Agreement, nor shall the Collateral Agent be
required or obligated in any manner to perform or fulfill any of the
obligations of any Assignor under or with respect to any Collateral.

 

14.11      Counterparts.  This Agreement
may be executed in any number of counterparts and by the different parties
hereto on separate counterparts, each of which when so executed and delivered
shall be an original, but all of which shall together constitute one and the
same instrument.

 

14.12      No Action by Secured Parties. 
The Secured Parties agree not to take any action whatsoever to enforce
any term or provision hereof, of any Mortgage or of any other Security Document
or to enforce any rights in respect of the Collateral, except through the
Collateral Agent and in accordance with this Agreement.

 

14.13      Definitions; Interpretation.

 

(a)           Unless otherwise defined herein,
capitalized terms used herein shall have the respective meanings ascribed
thereto in Annex A or, if not defined herein or in Annex A, as
defined in the Credit Agreement.

 

(b)           The definitions set forth herein
(including those set forth in Annex A) shall be equally applicable
equally applicable to both the singular and plural forms of the defined
terms.  In the computation of periods of
time from a specified date to a later specified date, the word “from” means “from
and including” and the words “to” and “until” each mean “to but excluding.”  The words “herein,” “hereof” and words of
similar import as used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision in this Agreement.  References to “Articles”, “Sections”, “paragraphs”,
“Exhibits” and “Schedules” in this Agreement shall refer to Articles, Sections,
paragraphs, Exhibits and Schedules of this Agreement unless otherwise expressly
provided; references to Persons include their respective permitted successors
and assigns or, in the case of governmental Persons, Persons succeeding to the
relevant functions of such persons; and all references to statutes and related
regulations shall include any amendments of same and any successor statutes and
regulations.  Unless otherwise expressly
provided herein, references to constitutive and Organizational Documents and to
agreements (including the Loan Documents) and other contractual instruments
shall be deemed

 

41

 

to include subsequent
amendments, restatements, extensions, supplements and other modifications
thereto, but only to the extent that such amendments, restatements, extensions,
supplements and other modifications are not prohibited by any Loan Document..

 

14.14      Conflicts with the Credit Agreement. 
To the extent of any conflict between any provision of this Agreement
and any provision of the Credit Agreement, the Credit Agreement shall govern to
the extent of such inconsistency.

 

14.15      References to this Agreement in Other Documents.  This Agreement is (a) the “First Priority
Security Agreement” and the “Second Priority Security Agreement”, each as
defined in the Senior Secured Notes Indenture, (b) the “Security Agreement”
as defined in the Credit Agreement and (c) the “Security Agreement” as
defined in the Intercreditor Agreement.

 

 

[SIGNATURE PAGES FOLLOW]

 

42

 

IN WITNESS WHEREOF, the parties hereto have caused this
Collateral Security Agreement to be executed on their behalf as of the date
first referred to above.

 

 

	
   

  	
  DEUTSCHE BANK AG NEW YORK BRANCH,

  
	
   

  	
  as Collateral Agent,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Marguerite Sutton

  	
   

  
	
   

  	
  Name: Marguerite Sutton

  
	
   

  	
  Title: Director

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  DEUTSCHE BANK AG NEW YORK BRANCH, as

  
	
   

  	
  Administrative Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Marguerite Sutton

  	
   

  
	
   

  	
  Name: Marguerite Sutton

  
	
   

  	
  Title: Director

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  DEUTSCHE BANK AG NEW YORK BRANCH,

  
	
   

  	
  as UK Security Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Marguerite Sutton

  	
   

  
	
   

  	
  Name: Marguerite Sutton

  
	
   

  	
  Title: Director

  

 

 

Signature Page to
Collateral Security Agreement

 

 

	
   

  	
  HUNTSMAN INTERNATIONAL LLC,

  
	
   

  	
  as an Assignor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Sean Douglas

  	
   

  
	
   

  	
  Name: Sean Douglas

  
	
   

  	
  Title: Vice President and Treasurer

  

 

 

Signature Page to
Collateral Security Agreement

 

 

	
  HUNTSMAN FUELS, L.P.

  	
   

  
	
  By: Petrostar Fuels LLC,
  its General Partner

  	
   

  
	
  PETROSTAR FUELS LLC

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Samuel D. Scruggs

  	
   

  	
   

  
	
  Name: Samuel D. Scruggs

  	
   

  
	
  Title: Vice President

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  EXECUTED as a deed

  	
   

  
	
  TIOXIDE AMERICAS INC.

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ L. Russell Healy

  	
   

  	
   

  
	
  Name: L. Russell Healy

  	
   

  
	
  Title: Vice President and Treasurer

  	
   

  
	
   

  	
   

  
	
  Witnessed by:

  	
  /s/ Mykel Mason

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  EXECUTED as a deed by

  	
  )

  	
   

  
	
  TIOXIDE GROUP

  	
  )

  	
   

  
	
  acting by:

  	
  )

  	
   

  
	
   

  	
   

  
	
  /s/ J. Kimo Esplin

  	
   

  	
  J. Kimo Esplin, Director

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  /s/ L. Russell Healy

  	
   

  	
  L. Russel Healy, Director

  	
   

  
										

 

 

Signature Page to
Collateral Security Agreement

 

 

	
  AIRSTAR CORPORATION

  
	
  EUROFUELS LLC

  
	
  EUROSTAR INDUSTRIES LLC

  
	
  HUNTSMAN AUSTRALIA INC.

  
	
  HUNTSMAN CHEMICAL COMPANY LLC

  
	
  HUNTSMAN CHEMICAL FINANCE CORPORATION

  
	
  HUNTSMAN CHEMICAL PURCHASING CORPORATION

  
	
  HUNTSMAN EA HOLDINGS LLC

  
	
  HUNTSMAN ENTERPRISES, INC.

  
	
  HUNTSMAN ETHYLENEAMINES LTD.

  
	
  By: Huntsman EA Holdings
  LLC, its General Partner

  
	
  HUNTSMAN EXPANDABLE POLYMERS COMPANY, LC

  
	
  By: Huntsman International
  Chemicals Corporation, its Sole Member and Manager

  
	
  HUNTSMAN FAMILY CORPORATION

  
	
  HUNTSMAN GROUP HOLDINGS FINANCE CORPORATION

  
	
  HUNTSMAN GROUP INTELLECTUAL PROPERTY HOLDINGS CORPORATION

  
	
  HUNTSMAN HEADQUARTERS CORPORATION

  
	
  HUNTSMAN INTERNATIONAL CHEMICALS CORPORATION

  
	
  HUNTSMAN INTERNATIONAL FINANCAL LLC

  
	
  HUNTSMAN INTERNATIONAL FUELS, L.P.

  
	
  By: Eurofuels LLC, its
  General Partner

  
	
  HUNTSMAN INTERNATIONAL SERVICES CORPORATION

  
	
  HUNTSMAN INTERNATIONAL TRADING CORPORATION

  
	
  HUNTSMAN MA INVESTMENT CORPORATION

  
	
  HUNTSMAN MA SERVICES CORPORATION

  
	
  HUNTSMAN PETROCHEMICAL CANADA HOLDINGS CORPORATION

  
	
  HUNTSMAN PETROCHEMICAL CORPORATION

  
	
  HUNTSMAN PETROCHEMICAL FINANCE CORPORATION

  
	
  HUNTSMAN PETROCHEMICAL PURCHASING CORPORATION

  
	
  HUNTSMAN POLYMERS CORPORATION

  
	
  HUNTSMAN POLYMERS HOLDINGS CORPORATION

  
	
  HUNTSMAN PROCUREMENT CORPORATION

  
	
  HUNTSMAN PROPYLENE OXIDE HOLDINGS LLC

  
	
  HUNTSMAN PROPYLENE OXIDE LTD.

  
	
  By: Huntsman Propylene
  Oxide Holdings LLC, its General Partner

  
	
  HUNTSMAN PURCHASING, LTD.

  
	
  By: Huntsman Procurement
  Corporation, its General Partner

  
	
  HUNTSMAN TEXAS HOLDINGS LLC

  
	
  JK HOLDINGS CORPORATION

  
	
  PETROSTAR INDUSTIRES LLC

  
	
  POLYMER MATERIALS INC.

  
	
   

  
	
   

  
	
  By:

  	
  /s/ Sean Douglas

  	
   

  
	
  Name:  Sean Douglas

  
	
  Title: 
  Vice President

  

 

 

Signature Page to
Collateral Security Agreement

 

 

ANNEX A

 

DEFINITIONS

 

“Administrative Agent” shall have the meaning provided in the
recitals to this Agreement.

 

“Agreement” shall have the meaning provided in the first
paragraph of this Agreement.

 

“Assets” means, collectively, the Collateral, the
Mortgaged Property (as defined in the Credit Agreement) and all collateral
under any and all other Security Documents in favor of the Collateral Agent or,
as the context requires, any one or more items thereof.

 

“Assignor” shall have the meaning provided in the first
paragraph of this Agreement.

 

“Bankruptcy Code” means Title 11 of the United States Code, as
codified in 11 U.S.C. § 101 et seq., as amended from time to time.

 

“Bank Obligations” means all Credit Agreement Obligations, all
Overdraft Facilities Obligations and all Secured Hedging Obligations.

 

“Borrower” shall have the meaning provided in the
recitals to this Agreement.

 

“Capital Stock”
means, with respect to any Person, any and all shares, interests,
participations, rights in or other equivalents (however designated) in such
Person’s capital stock, partnership interests, membership interests or other
equivalent interests and any rights (other than debt securities convertible
into or exchangeable for capital stock), warrants or options exchangeable for
or convertible into any such ownership interests.

 

“Chattel Paper” has the meaning provided in the UCC.

 

“Collateral” has the meaning ascribed to it in Section 1.1
of this Agreement.

 

“Collateral Agent” means Deutsche Bank AG New York Branch, in
its capacity as collateral agent under this Agreement for the benefit of the
Secured Parties, until one or more successors are appointed pursuant to Article XII
of this Agreement and thereafter shall mean such successor or successors and
all successors thereto.

 

“Collateral Agent Costs” has the meaning ascribed to it in Section 10.1(a) of
this Agreement.

 

“Commercial Tort Claim” means any commercial tort claim which any
Assignor now owns or hereafter acquires, including any such claims listed on Schedule 2.1(k)
(as such Schedule may be amended from time to time in accordance with Section 7.5
or otherwise).

 

A-1

 

“Company” shall have the meaning provided in the first
paragraph of this Agreement.

 

“Contract Rights” with respect to any Assignor, means all
rights of such Assignor (including, without limitation, all rights to payment)
under each Contract.

 

“Contracts”
means all contracts between an Assignor and one or more additional parties,
including, without limitation, (i) each partnership agreement to which
such Assignor is a party, (ii) each Hedging Agreement to which such
Assignor is a party; (iii) any Overdraft Facilities Agreement, and (iv) the
Foreign Intercompany Loan Documents.

 

“Copyrights” means any copyright registered with the
United States Copyright Office, as well as any application for a United States
copyright registration made with the United States Copyright Office.

 

“Credit Agreement” shall have the meaning provided in the
recitals to this Agreement.

 

“Credit Agreement Obligations” means all liabilities of any Assignor now or
hereafter arising under the Credit Agreement and all of the other Debt
Documents, whether for principal, interest (including Post-Petition Interest),
fees, expenses, indemnities or otherwise, and whether primary, secondary,
direct, indirect, contingent, fixed or otherwise (including obligations of
performance).

 

“Debt Documents”  shall
mean and include, respectively, the Credit Agreement, the Loan Documents, and
all other documents, instruments and agreements now or hereafter evidencing or
securing the whole or any part of the Credit Agreement Obligations (including,
without limitation, each of the loan documents as defined in any principal
agreement evidencing Credit Agreement Obligations), including any documents
evidencing or securing any complete, partial or successive refunding,
refinancing or replacement of the Credit Agreement Obligations and any
amendments, modifications, renewals or extensions of any of the foregoing.

 

“Debt Instruments” means all documents, instruments or other
evidence of indebtedness issued in respect of the Secured Obligations, as they
may be amended, restated, supplemented or otherwise modified from time to time.

 

“Default Certification” has the meaning ascribed to it in Section 8.1(b) of
this Agreement.

 

“Deposit Accounts” has the meaning provided in Article 9
of the UCC.

 

“Documents” has the meaning provided in the UCC.

 

“Electronic Chattel Paper” has the meaning provided in the UCC.

 

“Equipment”
means any “equipment”, as such term is defined in the UCC and, in any event,
shall include, but shall not be limited to, all machinery, equipment,
furnishings, movable trade fixtures and vehicles and any and all additions,
substitutions and replacements of

 

A-2

 

any
of the foregoing, wherever located, together with all attachments, components,
parts, equipment and accessories installed thereon or affixed thereto.

 

“Event of Default” shall mean any Event of Default under, and
as defined in, the Credit Agreement or the Senior Secured Notes Indenture and
shall in any event, without limitation, include any payment default on any of
the Secured Obligations after expiration of any applicable grace period.

 

“Excluded Foreign
or Transportation Assets” means the following Collateral,
collectively:

 

(i)            all property of the Assignors located at its
cement manufacturing facility in Armenia, to the extent that a security
interest therein granted by the Company may be perfected only by actions taken
under the laws of jurisdictions other than the United States or any state or
subdivision thereof;

 

(ii)           Inventory located outside of the United
States and having an aggregate book value for all Assignors together of less
than $20,000,000; and

 

(iii)          Excluded Transportation Assets.

 

“Excluded
Transportation Assets” means, titled vehicles, vessels, aircraft,
railcars, rolling stock and other assets and properties owned by Assignors in
which a security interest may not be perfected through the filing of financing
statements under the UCC and which have an aggregate fair market value from
time to time of less than $5,000,000 for all Assignors together.

 

“Existing Hedging Agreements” shall have the meaning provided in the recitals
to this Agreement.

 

“Fixtures” has the meaning provided in the UCC.

 

“Fully Paid” means with respect to any Secured
Obligations, that the respective obligee of such Obligation or its
representative (which representative shall be, in the case of the Bank
Obligations, the Administrative Agent, and in the case of the Senior Secured
Notes Obligations, the Senior Secured Notes Trustee) shall have certified to
the Collateral Agent that such Obligation has terminated and that there remain
no obligations of any kind whatsoever of the Borrower with respect thereto
(other than contingent indemnification obligations as to which no claims shall
have accrued or be pending).

 

“General Intangibles” has the meaning provided in the UCC and in
any event includes all claims, rights, powers, privileges, authority, options,
security interests, liens and remedies under any partnership agreement to which
an Assignor is a party or with respect to any partnership of which an Assignor
is a partner.

 

“Goods” has the meaning provided in the UCC.

 

“Headquarters Loan Agreement” shall have the meaning provided in the
recitals to this Agreement.

 

A-3

 

“HLLC” shall have the meaning provided in the
recitals to this Agreement.

 

“Indemnified Party” shall have the meaning provided in Section 9.1
of this Agreement.

 

“Instructing Group” means (i) unless and until the Credit
Agreement Obligations have been Fully Paid, as of any date of determination
thereof, the Administrative Agent or Required Lenders (or, to the extent
required by Section 12.1 of the Credit Agreement, all the Lenders) and (ii) after
the date on which the Credit Agreement Obligations have been Fully Paid, the
Senior Secured Notes Trustee.

 

“Instrument” has the meaning provided in Article 9
of the UCC.

 

“Intellectual Property Causes of
Action” with respect
to any Assignor, means any and all causes of action for infringements of
Patents, Trademarks, Copyrights, or Trade Secrets of such Assignor.

 

“Intercreditor Agreement” shall have the meaning provided in Section 1.5
of this Agreement.

 

“Inventory” shall mean all “inventory” as such term is
defined in Article 9 of the UCC, now owned or hereafter acquired by any
Assignor and, in any event, shall include, but shall not be limited to, all
merchandise, inventory and goods, and all additions, substitutions and
replacements thereof, wherever located, together with all goods, supplies,
incidentals, packaging materials, labels, materials and any other items used or
usable in manufacturing, processing, packaging or shipping same; in all stages
of production — from raw materials through work-in-process to finished goods —
and all products and proceeds of whatever sort and wherever located and any
portion thereof which may be returned, rejected, reclaimed or repossessed by
the Collateral Agent from any Assignor’s customers.

 

“Investment Property” shall have the meaning as provided in Article 9
of the UCC and shall include, without limitation (i) all securities,
whether certificated or uncertificated, including, without limitation, stocks,
bonds, interests in limited liability companies, partnership interests,
treasury securities, certificates of deposit, and mutual fund shares; (ii) all
securities entitlements of any Assignor, including without limitation, the
rights of any Assignor to any securities account and the financial assets held
by a securities intermediary in such securities account and any free credit
balance or other money owing by any securities intermediary with respect to
that account; (iii) all securities accounts held by any Assignor; (iv) all
commodity contracts held by Assignor; and (v) all commodity accounts held
by any Assignor.

 

“Lenders” has the meaning ascribed to such term in the
recitals to this Agreement.

 

“Letter-of-Credit Rights” shall have the meaning as provided in Article 9
of the UCC.

 

“Marks” shall mean any trademarks and service marks
and trade names which are registered in the United States Patent and Trademark
Office or in any similar office or agency of the United States or any state
thereof or any political subdivision thereof and any application

 

A-4

 

for
such trademarks and service marks, as well as any unregistered marks used by
any Assignor in the United States and trade dress including logos, designs,
trade names, company names, business names, fictitious business names and other
business identifiers in connection with which any of these registered or
unregistered marks are used in the United States.

 

“Mortgage” means (i) when referring to the
Mortgaged Property, one of the Mortgages (ii) otherwise, the Security
Documents (other than this Agreement), including the Mortgages.

 

“Overdraft Facilities” means facilities relating to Indebtedness
permitted pursuant to Section 8.2(n) of the Credit Agreement, including,
without limitation, guarantees thereof.

 

“Overdraft Facilities Agreements” shall have the meaning provided in the
recitals to this Agreement.

 

“Overdraft Facilities Obligations” means all obligations of the Company or any
of its Subsidiaries under and with respect to the Overdraft Facilities (whether
direct or through a guarantee).

 

“Patents” means any patent issued by the United States
Patent and Trademark Office, as well as any application for a United States
patent registration pending with the United States Patent and Trademark Office
together with any issue, reexamination, re-issue, continuation, continuation
in-part, division, improvement or extension thereof.

 

“Pledged Debt” means the indebtedness as evidenced by the
Pledged Intercompany Notes.

 

“Pledged Intercompany Notes” means the Intercompany Notes described on Schedule B
hereto, as it may, from time to time, be supplemented in accordance with the
terms of this Agreement.

 

“Pledged Securities” means, collectively, the Pledged
Intercompany Notes, all other pledged promissory notes, and the Pledged Stock.

 

“Pledged Stock” means the certificated shares of Capital
Stock described in Schedule C hereto, as it may, from time to time,
be supplemented in accordance with the terms of the Agreement, and any other
shares of Capital Stock pledged to the Collateral Agent under this Agreement.

 

“Post-Petition Interest” shall mean interest accruing in respect of
Secured Obligations after the commencement of any bankruptcy, insolvency,
receivership or similar proceedings by or against the Company, at the rate
applicable to such Secured Obligations pursuant to the applicable Debt
Documents or the Senior Secured Notes Indenture, as applicable, whether or not
such interest is allowed as a claim enforceable against Company in a bankruptcy
case under the Bankruptcy Code, and any other interest that would have accrued
but for the commencement of such proceedings.

 

A-5

 

“Primary Obligations” has the meaning provided in Section 8.5(b) of
this Agreement.

 

“Pro Rata Share” has the meaning provided in Section 8.5(b) of
this Agreement.

 

“Proceeds” shall have the meaning ascribed to it in Article 9
of the UCC and, in any event, shall include, but not be limited to (a) any
and all proceeds of any insurance, indemnity, warranty or guaranty payable to
the Collateral Agent or any Assignor from time to time with respect to any of
the Assets, (b) any and all payments (in any form whatsoever) made or due
and payable to any Assignor from time to time in connection with any
requisition, confiscation, condemnation, seizure or forfeiture of all or any
part of the Assets by any Governmental Authority (or any Person acting under
color of Governmental Authority), and (c) any and all other amounts from
time to time paid or payable to any Assignor or the Collateral Agent under or
in connection with any of the Assets.

 

“Receivables” means any “account” as such term is defined
in the UCC, and, in any event, shall include, but shall not be limited to, all
rights to payment of a monetary obligation, whether or not earned by
performance; (i) for property that has been or is to be sold, leased,
licensed, assigned or otherwise disposed of; (ii) for services rendered or
to be rendered; (iii) for a policy of insurance issued or to be issued,
including health care insurance receivables (as such term is defined in the
UCC); (iv) for a secondary obligations incurred or to be incurred;  (v) for energy provided or to be provided;
(vi) for the use or hire of a vessel under charter or other contract; (vii) arising
out of the use of a credit card or information contained on or for use with the
card; or (viii) as winnings in a lottery or other game of chance operated
or sponsored by a State, governmental unit of a State, or person licensed or
authorized to operate the game by a State or governmental unit of a State,
whether now in existence or arising from time to time hereafter, including,
without limitation, such rights evidenced by an account, note, contract,
security agreement, chattel paper, or other evidence of indebtedness or
security, together with (i) all security pledged, assigned, hypothecated
or granted to or held to secure the foregoing; (ii) all right, title and interest
in and to any goods, the sale of which gave rise thereto; (iii) all
guarantees, endorsements and indemnifications on, or of, any of the foregoing; (iv) all
powers of attorney for the execution of any evidence of indebtedness or
security or other writing in connection therewith; (v) all books, records,
ledger cards, and invoices relating thereto; (vi) all evidences of the
filing of financing statements and other statements and the registration of
other instruments in connection therewith and amendments thereto, notices to
other creditors or secured parties, and certificates from filing or other
registration officers; (vii) all credit information, reports and memoranda
relating thereto; and (viii) all other writings related in any way to the
foregoing.

 

“Representative” has the meaning ascribed to it in Section 8.5(d) of
this Agreement.

 

“Secondary Obligations” shall have the meaning provided in Section 8.5(b) of
this Agreement.

 

“Secured Hedging Agreements” has the meaning provided in the first
paragraph of this Agreement.

 

A-6

 

“Secured Hedging Obligations” means all obligations of the Company or any
of its Subsidiaries under and with respect to the Secured Hedging Agreements
(whether direct or through a guarantee).

 

“Secured Obligations” means, collectively, the Bank Obligations
and the Senior Secured Notes Obligations.

 

“Secured Party” shall have the meaning provided in the first
paragraph of this Agreement.

 

“Senior Secured Notes” shall have the meaning provided in the
recitals to this Agreement.

 

“Senior Secured Notes Indenture” shall have the meaning provided in the
recitals to this Agreement.

 

“Senior Secured Notes Obligations” means all indebtedness, obligations and
liabilities of any Assignor now or hereafter owing pursuant to the Senior
Secured Notes Indenture and the Senior Secured Notes (including, without
limitation, premium, if any, interest (including Post-Petition Interest with
respect to the foregoing)), fees, costs, expenses and all indemnification and
reimbursement obligations of any Assignor under the Senior Secured Notes
Indenture and the Senior Secured Notes.

 

“Senior Secured Notes Trustee” shall have the meaning provided in the
recitals to this Agreement.

 

“Significant Copyrights” shall mean, at any time, those Copyrights
which the relevant Assignor believes in its reasonable judgment to be material
to its business at such time.

 

“Significant Marks” shall mean, at any time, those Marks which
the relevant Assignor believes in its reasonable judgment to be material to its
business at such time.

 

“Significant Patents” shall mean, at any time, those Patents which
the relevant Assignor believes in its judgment to be material to its business
at such time.

 

“Stock Rights” means any stock, any dividend or other
distribution and any other right or property which an Assignor shall receive or
shall become entitled to receive for any reason whatsoever with respect to, in
substitution for or in exchange for any shares of Pledged Stock and any stock,
any right to receive stock and any right to receive earnings, in which an
Assignor now has or hereafter acquires any right, issued by an issuer of the
Pledged Stock.

 

“Termination Date” shall have the meaning provided in Section 12.2
of this Agreement.

 

“Trade Secrets” means any know-how, technology, product
formulations, procedures and product and manufacturing specifications or
standards utilized in the manufacture, production and packaging of products,
including, without limitation, formulas for the composition and manufacture of
products sold under the Marks.

 

A-7

 

“Uniform Commercial Code” or “UCC”
shall mean the Uniform Commercial Code as now or hereafter in effect from time
to time in the State of New York; provided, however, that if by
reason of mandatory provisions of law, any or all of the attachment, perfection
or priority of, or remedies with respect to, the Collateral Agent’s security
interests in any Collateral is governed by the Uniform Commercial Code as
enacted and in effect in any other jurisdiction, the term “Uniform Commercial
Code” or “UCC” shall mean the Uniform Commercial Code as enacted and in effect
in such other jurisdiction solely for purposes of the provisions thereof
relating to such attachment, perfection, priority or remedies.

 

“Unmatured Event of Default”  means
an event, act or occurrence which with the giving of notice or the lapse of
time (or both) would become an Event of Default.

 

A-8

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00089-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00089-of-00352.parquet"}]]