Document:

EX-10.1

 

Exhibit 10.1

Termination and Release Agreement

     Termination and Release Agreement dated as of April 9, 2008 (this “Agreement”), by
and among The Scotts Company, LLC, a limited liability company organized under the laws of
Ohio (the “Company”), The Scotts Miracle-Gro Company, a company organized under the laws
of Ohio (the “Parent”), and LaSalle Bank National Association (the “Bank”), a bank
organized under the laws of the United States of America. Capitalized terms shall have the
meanings assigned to such terms in the Purchase Agreement (as defined below).

     Whereas, pursuant to the Master Accounts Purchase Agreement dated as of April 11,
2007, as amended, by and among the Company, the Parent and the Bank (the “Purchase Agreement”), the
Company has sold, and through the Effective Date will continue to sell interests in its Purchased
Receivables (the “Released Receivables”) to the Bank;

     Whereas, the parties to the Purchase Agreement wish to terminate the rights and
obligations of the Company, the Parent and the Bank under the Purchase Agreement and to terminate
each blocked account agreement and to have the Bank reconvey to the Company the Released
Receivables on the terms and conditions set forth herein;

     Whereas, the parties to the Purchase Agreement consent to the termination of the
rights and obligations of the Company, the Parent and the Bank under the Purchase Agreement and to
the termination of the blocked account agreement and the reconveyance of the Released Receivables;

     Whereas, pursuant to the Purchase Agreement, the Company granted security interests
and other rights in the Released Receivables and certain bank accounts to the Bank;

     Whereas, the Company wishes to have the above-mentioned security interests released
and such other rights to be terminated;

     Whereas, the Bank desires to sell and assign to the Company all of the Released
Receivables upon the terms and conditions hereinafter set forth; and

     Now, Therefore, for good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, it is hereby agreed by and among the parties hereto as follows:

 

 

     Section 1. Release from Purchase Agreement and Blocked Account Agreements.

     (a) The Bank hereby releases and discharges, effective as of the Effective Date, any and all
right, title and interest that it may now or hereafter have or may now or hereafter be entitled to
by virtue of the Purchase Agreement in all receivables and all other assets and property of the
Company, including without limitation the Released Receivables, and does hereby declare the same
fully released and discharged on the Effective Date from any and all security interests created by
virtue of or in connection with the Purchase Agreement.

     (b) The Bank does hereby release and discharge, effective as of the Effective Date, any and
all right, title and interest that it may have or be entitled to by virtue of or in connection with
the Purchase Agreement, in the blocked account agreement(s) in the related Blocked Account(s) named
on Schedule I hereto (the “Released Blocked Accounts”).

     Section 2. Release of Liens. From and after the Effective Date, the Bank agrees to execute
and deliver, or deliver, as the case may be, to the Company or the Parent proper financing
statements (Form UCC-3) or other instruments or documents, if any, necessary to release all
security interests and other rights of the Bank in and to the Released Receivables and any other
assets or property of the Company, pursuant to the Purchase Agreement or otherwise.

     Section 3. Sale of Receivables. Without recourse, representation or warranty (except as set
forth below), the Bank hereby agrees to sell, assign, transfer and convey to the Company on the
Effective Date, and the Company hereby purchases from the Bank all of the Bank’s right, title and
interest to and under such Released Receivables outstanding on the Effective Date, and all proceeds
of the foregoing. The Bank hereby represents that the Bank has not encumbered or transferred any
right, title or interest in and to the Released Receivables.

     Section 4. UCC Financing Statement. The Bank agrees to execute and deliver, on the Effective
Date, to the Company any proper financing statements (Form UCC-1 or other similar form) or other
instruments or documents, if any, with respect to Released Receivables sold by the Bank hereunder
meeting the requirements of applicable state law in such manner and in such jurisdiction as are
necessary to perfect and protect the interests of the Company and to deliver either the originals
of such financing statements or a file-stamped copy of such financing statements or other evidence
of such filings to the Company.

     Section 5. Conditions Precedent. This Termination and Release shall become effective on the
date (“Effective Date”) of satisfaction of the following conditions precedent: (i) the execution
and delivery hereof by the Company, the Bank and the Parent and (ii) if paid on or before 1:00 p.m.
(Central Standard Time) on April 9, 2008, the receipt of $288,052,797.07 in immediately available
funds, constituting payment in full of the outstanding amount of the Released Receivables and

$210,248.54 in immediately available funds, constituting all other amounts owing to the Bank under
the Purchase Agreement.

     Section 6. Further Assurances. The Bank hereby agrees to execute any and all further
documents, agreements and instruments prepared by the Company, and take all further action

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(at the
expense of the Company) that may be required by law or otherwise, necessary or desirable to give
effect to this Agreement and effectuate the termination of the blocked account agreements.

     Section 7. Governing Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York.

     Section 8. Execution in Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall constitute an original and all of which, when taken together,
shall constitute one agreement. Delivery of an executed counterpart of a signature page of this
Agreement shall be effective as delivery of a manually executed counterpart of this Agreement.

     Section 9. Beneficiaries. This Agreement shall be binding upon and inure to the benefit of
the Bank, the Parent, and the Company and their respective successors and assigns. .

     Section 10. Headings. Section headings in this Termination and Release are included for
convenience of reference only and are not part of this agreement for any other purpose.

     Section 11. Miscellaneous. The Company agrees to pay on demand all costs and expenses
(including reasonable fees and expenses of counsel) of or incurred by the Bank in connection with
the negotiation, preparation, execution and delivery of this Agreement.

     The undersigned each agree and confirm that all references in the Purchase Agreement
to the “Termination Date” shall be deemed to refer to the Effective Date.

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     In Witness Whereof, the parties hereto have executed and delivered this Termination
and Release Agreement as of the date first written above.

	 	 	 	 	 
	 	LaSalle Bank National Association

 	 
	 	By:  	/s/ Mike B. Delaney
 	 
	 	 	Name:  	Mike Delaney   	 
	 	 	Title:  	Vice President 	 
	 
	 	The Scotts Company LLC

 	 
	 	By:  	/s/ David C. Evans
 	 
	 	 	Name:  	David C. Evans   	 
	 	 	Title:  	C.F.O. 	 
	 
	 	The Scotts Miracle-Gro Company

 	 
	 	By:  	/s/ David C. Evans
 	 
	 	 	Name:  	David C. Evans   	 
	 	 	Title:  	C.F.O. 	 

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Schedule I

Released Company & Lock-Box Accounts

	 	 	 	 	 
	                   Bank 	 	Collection Account
	JPMorgan Chase Bank, N.A.
	 	 	744446444	 
	JPMorgan Chase Bank, N.A.
	 	 	744446493	 
	JPMorgan Chase Bank, N.A.
	 	 	744446519	 

-5-EX-10.2

 

Exhibit
10.2

  

 

Master Accounts Receivable Purchase Agreement

among

Bank of America, N.A.

(the “Bank”)

and

The Scotts Company LLC

(the “Company”)

and

The Scotts Miracle-Gro Company

(the “Parent”)

Dated as of April 9, 2008

 

 

 

Table of Contents

	 	 	 	 	 
	Section	 	Heading	 	Page
	Section 1.

	 	Definitions and Interpretation
	 	1
	 
	 	 	 	 
	Section 2.

	 	The Agreement
	 	8
	 
	 	 	 	 
	Section 3.

	 	Conditions Precedent
	 	8
	 
	 	 	 	 
	Section 4.

	 	Purchase of Receivables
	 	9
	 
	 	 	 	 
	Section 5.

	 	Limited Liability
	 	15
	 
	 	 	 	 
	Section 6.

	 	The Company as Servicer and Agent of Bank
	 	16
	 
	 	 	 	 
	Section 7.

	 	Payments
	 	18
	 
	 	 	 	 
	Section 8.

	 	Changes in Circumstances
	 	19
	 
	 	 	 	 
	Section 9.

	 	Further Assurances
	 	20
	 
	 	 	 	 
	Section 10.

	 	Representations and Warranties
	 	21
	 
	 	 	 	 
	Section 11.

	 	Covenants
	 	24
	 
	 	 	 	 
	Section 12

	 	Partial Invalidity
	 	27
	 
	 	 	 	 
	Section 13.

	 	No Bank Liability for Contract
	 	27
	 
	 	 	 	 
	Section 14.

	 	Notices, Addresses, Language
	 	27
	 
	 	 	 	 
	Section 15.

	 	Fees, Costs and Indemnity
	 	28
	 
	 	 	 	 
	Section 16

	 	Calculations and Certificate
	 	31
	 
	 	 	 	 
	Section 17.

	 	Set-Off
	 	31
	 
	 	 	 	 

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	Section	 	Heading	 	Page
	Section 18.

	 	Termination
	 	31
	 
	 	 	 	 
	Section 19.

	 	Miscellaneous
	 	33
	 
	 	 	 	 
	Section 20.

	 	Governing Law
	 	35
	 
	 	 	 	 
	Section 21.

	 	Optional Repurchase
	 	36
	 
	 	 	 	 
	Section 22.

	 	Guaranty
	 	37
	 
	 	 	 	 
	Section 23.

	 	Removal; Reinstatement of Debtor
	 	38
	 
	 	 	 	 
	Section 24.

	 	Confidentiality
	 	39

	 	 	 	 	 
	Schedule 1

	 	—
	 	Purchase Request
	Schedule 2

	 	—
	 	Conditions Precedent
	Schedule 3

	 	—
	 	UCC Details Schedule
	Schedule 4

	 	—
	 	Form of Portfolio Report

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Master Accounts Receivable Purchase Agreement

     Master Accounts Receivable Purchase Agreement, dated as of April 9, 2008 (this
“Agreement”), among The Scotts Company, LLC, a limited liability company organized under
the laws of Ohio (the “Company”), The Scotts Miracle-Gro Company, a company organized
under the laws of Ohio (the “Parent”), and Bank of America, N.A. (the “Bank”), a bank
organized under the laws of the United States of America.

     Whereas, the Company and LaSalle Bank National Association (“LaSalle”) entered into
that certain Master Accounts Receivable Purchase Agreement dated as of April 11, 2007 (the “LaSalle
Agreement”) pursuant to which the Company sold to LaSalle certain receivables.

     Whereas, on the date hereof LaSalle is assigning all of the outstanding receivables
purchased pursuant to the terms of the LaSalle Agreement to the Company pursuant to that certain
Termination and Release Agreement dated the date hereof.

     Whereas, after the date hereof and subject to the terms and conditions of this
Agreement, the Company shall sell to the Bank and the Bank shall purchase from the Company, on a
revolving basis, certain Purchased Receivables.

     Whereas, the transactions hereunder shall constitute a true sale of the Purchased
Receivables, providing the Bank with the full risks and benefits of ownership of the Purchased
Receivables without recourse to the Company, except as may otherwise be set forth herein.

     Now, Therefore, in consideration of the above premises and for other good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties
hereto hereby agree as follows:

Section 1. Definitions and Interpretation.

     In this Agreement and each Schedule:

     “Adverse Claim” means any Encumbrance on a Purchased Receivable other than those arising under
this Agreement.

     “Agreed Base Value” shall be an amount equal to the product of (a) the difference between (i)
the full Original Amount of the Receivable being purchased less (ii) the Trade Credit Amount times
(b) 100% less the Agreed Dilution Percentage.

     “Agreed Dilution Percentage” is equal to 5.0% or such other percentage agreed on, from time to
time, by the Bank and the Company.

 

 

     “Agreement Amount” means the maximum aggregate Funded Amounts of all Purchased Receivables as
set forth below during the relevant time periods, as such amount may be reduced from time to time
pursuant to the terms of Section 4.3(d) hereof:

	 	 	 	 	 	 	 	 	 	 	 
	January
	 	$	40,000,000	 	 	July	 	$	200,000,000	 
	February
	 	$	125,000,000	 	 	August	 	$	100,000,000	 
	March
	 	$	275,000,000	 	 	September	 	$	75,000,000	 
	April
	 	$	300,000,000	 	 	October	 	$	75,000,000	 
	May
	 	$	300,000,000	 	 	November	 	$	30,000,000	 
	June
	 	$	300,000,000	 	 	December	 	$	10,000,000	 

     “Agreement Office” means the office through which the Bank will perform its obligations under
this Agreement.

     “Approved Debtor” means each Person listed on the Approved Debtor Certificate, excluding any
Approved Debtor removed therefrom pursuant to the terms of Section 23 hereof and including any
Debtor reinstated therein as an Approved Debtor pursuant to the terms of Section 23 hereof.

     “Approved Debtor Certificate” means the Approved Debtor Certificate of even date herewith
executed by the Bank and the Company.

     “Approved Participants” means Sumitomo Mitsui Banking Corporation, Calyon New York Branch, BNP
Paribas, New York Branch and The Bank of Nova Scotia.

     “Blocked Accounts” means each account opened by the Company in its name for each Approved
Debtor with JPMorgan Chase Bank, N. A. or such other bank approved by the Bank for the purpose of
collecting the Purchased Receivables of such Approved Debtor and which shall be subject to a
blocked account agreement with the Bank.

     “Business Day” means a day on which banks are open for business in Chicago, New York and, in
the case of the determination of LIBOR, London.

     “Closing Date” means the date of this Agreement or such later Business Day upon which each
condition described on Schedule 2 shall be satisfied or waived in a manner acceptable to the Bank
in its reasonable discretion.

     “Collections” means all payments made on each Purchased Receivable and any other payments,
receipts or recoveries (including any casualty insurance proceeds) by, or on behalf of, any Debtor
or otherwise with respect to any Purchased Receivable.

     “Contract” means a contract or purchase order between the Company and a Debtor, as the same
may be amended and supplemented from time to time in accordance with the terms hereof, out of which
has arisen one or more Purchased Receivables.

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     “Cost of Funds” means, with respect to any Purchased Receivable(s), the rate, as determined by
the Bank as of the purchase date of such Purchased Receivable(s) (which determination shall be
conclusive and binding on the Company absent manifest error) at which Dollars of a term comparable
to the period of time from the purchase date to the Maturity Date for such Receivable(s) and in an
amount comparable to the Purchase Price for such Receivable(s) are generally available to the Bank.

     “Credit Agreement” means that certain Amended and Restated Credit Agreement dated as of
February 7, 2007, among the Parent, the subsidiary borrowers from time to time party thereto, the
several lenders from time to time party thereto, JPMorgan Chase Bank, N.A., as administrative agent
and the various lenders from time to time to the party thereto.

     “Debtor” means a person obligated to make payments in respect of a Receivable.

     “Debtor Sublimits” means the sublimits for each Approved Debtor listed on the Approved Debtor
Certificate.

     “Dilution” means any discount, adjustment, set-off, counterclaim, deduction, reduction,
warranty issue or refusal to pay not arising from such Debtor’s Financial Inability to Pay, which
would have the effect of reducing the amount of part or all of any Purchased Receivable owed by a
Debtor.

     “Dollar, USD” and “$” shall mean the lawful currency of the United States of America.

     “Downgrade” means each rating category reduction by a nationally recognized rating agency of
the long-term unsecured, unenhanced indebtedness rating of any Person, for example, a rating
reduction from “A-” (or its equivalent) to “BBB” (or its equivalent) would constitute two
Downgrades for purposes of this Agreement.

     “Encumbrance” means a mortgage, assignment, security interest, pledge, lien or other
encumbrance securing any obligation of any person or any other type of adverse claim or
preferential arrangement (including, without limitation, title transfer and retention arrangements)
having a similar effect.

     “Final Collection Date” means the date, following the termination of purchases under this
Agreement, on which all amounts to which the Bank shall be entitled in respect of Purchased
Receivables and all other amounts owing to the Bank hereunder and under the other Transaction
Documents are paid in full.

     “Financial Inability to Pay” means a Debtor’s failure to pay a Receivable as a result
of a deterioration in such Debtor’s credit quality as evidenced by an event where such Debtor
(A)(i) is dissolved (other than pursuant to a consolidation, amalgamation or merger); (ii) becomes
insolvent or is unable to pay its debts or fails or admits in writing its inability generally to
pay its debts as they become due; (iii) makes a general assignment, arrangement or composition with
or for the benefit of its creditors; (iv) institutes or has instituted against it a proceeding
seeking judgment of insolvency or bankruptcy or any other relief under any

-3-

 

bankruptcy or insolvency
law or other similar law affecting creditor’s rights, or a petition is presented for its
winding-up or liquidation, and, in the case of any such proceeding or petition instituted or
presented against it, such proceeding or petition (aa) results in a judgment of insolvency or
bankruptcy or the entry of an order for relief or the making of an order for its winding up or
liquidation or (bb) is not dismissed, discharged, stayed or restrained in each case within 30 days
of the institution or presentation thereof; (v) has a resolution passed for its winding-up,
official management or liquidation; (vi) seeks or becomes subject to the appointment of an
administrator, provisional liquidator, conservator, receiver, trustee, custodian or other similar
official for it or for all or substantially all of its assets; (vii) has a secured party take
possession of all or substantially all its assets or has a distress, execution, attachment,
sequestration or other legal process levied, enforced or sued on or against all or substantially
all its assets and such secured party maintains possession, or any such process is not dismissed,
discharged, stayed or restrained, in each case within 30 days thereafter, (viii) causes or is
subject to any event with respect to it which, under the applicable laws of any jurisdiction, has
an analogous effect to any of the events specified in clauses (i) to (vii) (inclusive); (ix) takes
any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of
the foregoing acts; or (x) at any time that the long-term unenhanced, unsecured indebtedness rating
of such Debtor is “CCC” (or its equivalent) or lower, fails to pay 10% or more of the aggregate
amount of Purchased Receivables owed by it, for more than 90 days beyond the relevant Maturity
Dates thereof (unless such Debtor claims, and the Company agrees, such failure to pay is a result
of a commercial dispute related to such Purchased Receivables), or (B) fails, after giving effect
to any applicable grace period for the relevant obligation(s) of such Debtor (other than such
Receivable), to make, when due, any payments equal to or exceeding $10,000,000 under such
obligations.

     “Funded Amount” means the aggregate amount of Purchase Prices paid by the Bank hereunder, less
the Collections, if any, theretofore paid to and received by the Bank.

     “Governmental Authority” means any nation or government, any state or other political
subdivision thereof and any entity exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government.

     “Invoice” means an invoice issued by the Company to a Debtor for payment for goods or services
supplied pursuant to a Contract between the Company and such Debtor.

     “Law” means any law (including common law), constitution, statute, treaty, regulation, rule,
ordinance, order, injunction, writ, decree or award of any Governmental Authority.

     “LIBOR” means in relation to a Purchased Receivable for any period:

     (a) the applicable Screen Rate for the relevant period; or

     (b) (if no Screen Rate is available) the arithmetic mean of the rates (rounded upwards
to four decimal places) at which the Bank was offering deposits for the relevant period in
an amount comparable to the Purchased Receivables or overdue amount in Dollars to leading
banks in the London interbank market.

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     “Margin” means 0.80% per annum, subject to the right of the Bank, upon the occurrence of a
Downgrade relating to any Account Debtor that does not otherwise cause a Termination Event, on 30
days’ prior written notice to the Company to revise the margin applicable to subsequent purchases
hereunder.

     “Maturity Date” means, with respect to a Purchased Receivable, the date on which such
Purchased Receivable becomes due and payable by the Debtor.

     “Monsanto Agreement” means the Amended and Restated Exclusive Agency and Marketing Agreement
by and between The Monsanto Company and the Company.

     “Monsanto Receivables” means accounts receivable (and all related proceeds) originated and
owned by The Monsanto Company of an Approved Debtor and otherwise subject to the terms of the
Monsanto Agreement.

     “Moody’s” means Moody’s Investors Service, Inc.

     “Original Amount” means, in relation to a Purchased Receivable, the amount owing from the
Debtor in respect of such Purchased Receivable being the aggregate amount payable under the
relevant Invoice.

     “Outstanding Amount” means the aggregate amount from time to time in Dollars of the Original
Amounts of all Purchased Receivables which are outstanding. For the avoidance of doubt, the
Outstanding Amount of any Purchased Receivable shall not be reduced as a result of any write-down
or write-off of such Purchased Receivable by the Bank.

     “Outstanding Net Amount” means, as of any date of determination, the amount equal to the
difference between (x) the product of (a) the difference between (i) the aggregate Outstanding
Amount of Purchased Receivables less (ii) the aggregate Trade Credit Amounts times (b) 100% less
the most recently calculated Agreed Dilution Percentage less (y) the aggregate Discount as most
recently calculated for the Purchased Receivables.

     “Participation Agreement” is defined in Section 19 hereof.

     “Person” means an individual, partnership, corporation, limited liability company, business
trust, joint stock company, trust, unincorporated association, joint venture, Governmental
Authority or other entity of whatever nature.

     “Portfolio Report” means a report, substantially in the form of Schedule 4, signed by an
officer of the Company and which shall contain, inter alia, the list of Receivables which have been
determined to be Purchased Receivables hereunder as well as a list of all relevant Invoices.

     “Purchase Price” means, in relation to any Purchased Receivable, the purchase price computed
and payable in accordance with Section 4.1 hereof.

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     “Purchased Receivable” means, at any time, any Receivable sold by the Company and acquired by
the Bank under this Agreement.

     “Purchase Request” means a request for purchase in the form attached hereto as Schedule 1.

     “Receivable” means the indebtedness of an Approved Debtor to the Company arising under a
Contract which is evidenced by an Invoice (including the right to receive payment of any interest
or finance charges or other liabilities of such Debtor under the Contract), all Related Assets with
respect thereto, and all Collections and other proceeds with respect to the foregoing.

     “Related Assets” means, with respect to the Receivables (i) all related rights and remedies
under or in connection with the Contract with respect thereto including bills of lading, bills of
exchange, promissory notes and accessions, (ii) all guaranties, suretyships, letters of credit,
security, liens and other arrangements supporting payment thereof, (iii) all Sales Records
(including electronic records) with respect thereto, (iv) all related insurance, and (v) all
proceeds of the foregoing.

     “Replacement Receivables” are Receivables purchased with the proceeds of Collections purchased
between two Settlement Dates as provided in Section 4.2.

     “Repurchase Event” means, with respect to a Purchased Receivable:

     (i) any representation or warranty made by the Company in Section 10 of this Agreement
with respect to such Receivable is inaccurate, incorrect or untrue, in any material respect,
on any date as of which it is made or deemed to be made; or

     (ii) the Company fails to comply with any of its covenants with respect to such
Receivable set forth in Section 11 of this Agreement; or on any day the Original Amount of
such Purchased Receivable (i) is reduced or adjusted as a result of any defective, rejected,
returned, repossessed or foreclosed merchandise, any defective or rejected services, any
discount or other adjustment by the Company (including on account of credits, rebates,
chargebacks, inventory transfers, allowances for early payments and other allowances) or any
obligation of the Company owed to the applicable Debtor to make such a discount or
adjustment, (ii) is reduced or cancelled as a result of a setoff, deduction or counterclaim
in respect of any claim by the Debtor thereof against the Company (whether such claim arises
out of the same or a related or an unrelated transaction) or (iii) otherwise is less than
the amount reported by the Company in (or for purposes of) any settlement statement
delivered pursuant to this Agreement (for any reason other than receipt of Collections on
such Purchased Receivable or such Purchased Receivable being written off as uncollectible
based on Debtor’s Financial Inability to Pay); provided, however, that to the extent that
the occurrence of any matter described in the foregoing paragraphs (i) or (ii) would
otherwise result in a Repurchase Event, no Repurchase Event with respect to any such
Purchased Receivable shall occur if the amount of any such adjustment caused by the
occurrence of such event has already been

-6-

 

included in the calculation of the Purchase Price paid with respect to such Purchased
Receivable.

     “S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc.

     “Sales Records” means the accounts, all sales ledgers, purchase and sales day books, sales
invoices, supply contracts and other related books and records of the Company relating to a Debtor
and on an individual Purchased Receivable basis for the purpose of identifying amounts paid or to
be paid in respect of such Purchased Receivable.

     “Screen Rate” means the interest rate for Dollar deposits for a three month period which is
displayed on the screen displays designated “LIBOR01” and “ICAP01” of the Reuters service (or such
other page which may replace them for the purpose of displaying British Bankers’ Association
Interest Settlement Rates or US Dollar Swaps Rates for Dollar deposits in the London interbank
market).

     “Settlement Date” means, in respect of any Settlement Period, the Wednesday of the calendar
week following such Settlement Period (or, if such Wednesday is not a Business Day, the immediately
succeeding Business Day) or such other date as the Bank and the Company may from time to time agree
to, provided that (i) with respect to the initial purchase hereunder, the date of such purchase
shall be the initial Settlement Date and (ii) on or after the Termination Date, the Bank may select
Settlement Dates by notice to the Company.

     “Settlement Period” means (a) with respect to the initial purchase, a period from the date of
such purchase pursuant to Section 4.1 to the Wednesday of the calendar week following the calendar
week in which such purchase is made (or, if such Wednesday is not a Business Day, the immediately
succeeding Business Day) or as otherwise agreed between the Bank and the Company and (b)
thereafter, each period commencing on the last day of the immediately preceding such period and
ending on the next Settlement Date or as otherwise agreed between the Bank and the Company,
provided, however, that at any time the Bank and the Company may mutually agree to select any
different period as the Settlement Period; provided, further, however, that if such agreement is
not reached within 10 days, a Termination Event may be declared by the Bank.

     “Stated Termination Date” means April 8, 2009, or such later date as may be extended by mutual
agreement of the Bank and the Company.

     “Tax” means any present or future withholding tax, levy, impost, duty or other tax or charge
of any similar nature (including but not limited to any interest or penalty payable in connection
with any failure to pay any of the same); and Taxation shall be construed accordingly.

     “Termination Date” means the earliest to occur of (i) termination of this Agreement pursuant
to Section 18, (ii) the Stated Termination Date and (iii) the Business Day designated by the
Company with no less than thirty (30) days prior notice to the Bank.

-7-

 

     “Termination Event” means any of the events set forth in Section 18.

     “Trade Credit Amount” means, with respect to a Purchased Receivable, the Dollar amount from
time to time accrued on the books and records of the Company and as reported to the Bank on each
Portfolio Report as a trade credit, trade allowance, return allowance or similar arrangement
between the Company and the related Approved Debtor that might result in a reduction of such
Purchased Receivable in the future.

     “Transaction Document” means each of this Agreement, each Purchase Request, each Portfolio
Report, the blocked account agreements, the Approved Debtor Certificate and all related documents.

     “UCC” means the Uniform Commercial Code as from time to time in effect in the State of New
York.

Section 2. The Agreement.

     Section 2.1. Prior to the Termination Date, subject to the terms and conditions of this
Agreement, the Company hereby sells and assigns to the Bank, and the Bank hereby agrees to
purchase, in each case, up to the Agreement Amount and subject to the applicable Debtor Sublimits
(it being understood that the Outstanding Amount of the Purchased Receivables when sold and
purchased will be greater than the Agreement Amount), a 100% interest in all of the present and
future Receivables of each Approved Debtor (subject to the removal of an Approved Debtor pursuant
to the terms of Section 23) and as identified in the most recent Portfolio Report delivered to the
Bank under this Agreement or as identified in such other manner acceptable to the Bank; provided,
however, that in any event the Receivables purchased and sold hereunder with respect to an Approved
Debtor shall be deemed to be the Receivables of such Approved Debtor with the earliest due date
(based upon their net invoice value excluding all accruals for any discounts).

Section 3. Conditions Precedent.

     Section 3.1. The Company shall not be entitled to request the Bank to make the initial
purchase of Purchased Receivables unless:

     (a) the Bank has received all of the documents listed in Schedule 2 in form and
substance reasonably satisfactory to it;

     (b) the representations and warranties made by the Company in Section 10 of this
Agreement are true and correct as of the Closing Date;

     (c) the Bank has received the fees and other amounts payable by the Company pursuant to
Section 15;

     (d) the Company shall have established the segregated Blocked Accounts for the
collection of the Purchased Receivables;

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     (e) no Termination Event shall have occurred; and

     (f) the Closing Date falls at least one Business Day after the date of the delivery of
the initial Purchase Request and initial Portfolio Report to the Bank. Such Portfolio
Report shall list the Receivables requested to be purchased in a format and contain such
information as shall be reasonably satisfactory to Bank.

     Section 3.2. No purchase shall be made hereunder unless:

     (a) the Bank has received a Purchase Request in connection with the initial purchase
and any incremental purchase that increases the then current Funded Amount.

     (b) The aggregate of the Outstanding Net Amount of the Receivables referred to in the
Portfolio Report (after giving effect to such purchase) as of the applicable purchase date
will not exceed the Agreement Amount or the Debtor Sublimits on the applicable purchase
date.

     (c) The Invoices referred to in the Portfolio Report each have a date certain for
payment which is no more than 90 days from the relevant purchase date, and are denominated
in Dollars.

Section 4. Purchase of Receivables.

     Section 4.1. The Bank shall pay a Purchase Price to the Company for the Purchased Receivables
sold to the Bank, equal to the Agreed Base Value less any other amounts owing to the Bank
hereunder. With respect to the payment of Discount by the Company, the Bank has agreed that
Discount will be payable in arrears in installments on each Settlement Date. The “Discount” will
equal the product of (1) the Agreed Base Value of the Purchased Receivables to be purchased on such
date, (2) the applicable LIBOR plus, the Margin (computed on the basis of a 360-day year), and (3)
a fraction the numerator of which is the weighted average number of days until Purchased
Receivables are due and the denominator of which is 360. Notwithstanding the foregoing, for only
the initial purchase hereunder, Discount shall be calculated using Cost of Funds (computed on the
weighted average tenor of the Purchased Receivables) and not the applicable LIBOR. Two Business
Days prior to each Settlement Date, the Bank shall determine the applicable LIBOR for the
subsequent Settlement Period. The Company shall be entitled, to the extent collected by the
Company, to receive and retain, an amount equal to Collections on the Purchased Receivables in
excess of the Agreed Base Value of such Purchased Receivables, such amounts to first be applied to
the delivery to the Company of any Trade Credit Amounts due to the Company, as applicable, with the
remainder of such amounts to be paid to the Company as a servicing fee. Without limiting the
liability and obligations of the Company hereunder, the Bank shall be entitled to offset against
and deduct from such excess all amounts owing by the Company to the Bank under this Agreement and
the Transaction Documents. So long as the

Company is acting as servicer for the Purchased Receivables, the Company will be entitled to retain
such excess (less such offsets and deductions) as the Purchased Receivables are collected. Should
the Bank terminate the Company’s appointment as servicer, the Bank will pay to the

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Company such
excess over and above the amounts which the Bank is entitled to offset, upon collection of all
amounts owing in respect of the Purchased Receivables.

     The parties agree that the calculation of Agreed Base Value of Purchased Receivables included
Trade Credit Amounts which the Approved Debtors have historically been entitled to receive if
certain conditions in the future are met. To the extent that such Approved Debtors are not
entitled to receive any such Trade Credit Amounts, or in the event that any such Approved Debtors
are entitled to receive such Trade Credit Amounts but elect not to apply the corresponding Trade
Credit Amount to the reduction of any payment made on a Purchased Receivable, and the Collections
with respect to such Purchased Receivable include any such corresponding Trade Credit Amount, the
amount thereof shall be attributable to and paid to the Company.

     Section 4.2. Until the Termination Date, Collections may be used by the Company, as servicer,
and as agent for and on account of the Bank, to purchase from the Company Receivables of Approved
Debtors that meet all of the requirements contained herein applicable to the initial Purchased
Receivables (“Replacement Receivables”), which Replacement Receivables shall be held for the
exclusive benefit and account of the Bank to the same extent as the original Purchased Receivables
and shall constitute Purchased Receivables for all purposes of the Agreement. For purposes of
maintaining the perfection of the Bank’s interest in any Purchased Receivables and the proceeds
thereof, the Bank hereby appoints the Company as its agent in respect of any Collections prior to
such Collections being used to purchase Replacement Receivables, provided that the Company’s sole
duty as such agent shall be to hold such Collections in trust for the benefit of the Bank or to
purchase Replacement Receivables as aforesaid.

     Section 4.3. (a) The Company will instruct all Debtors under the Purchased Receivables to make
all payments on account thereof to the relevant Blocked Accounts. Each Invoice shall also require
that payments be made to the relevant Blocked Accounts. All Collections will be received and held
in the Blocked Accounts in the name of and for the Bank as the owner thereof and, except as
otherwise provided in this Agreement, will be applied in the manner set forth in (b) below. The
Bank may suspend or terminate all of the Company’s right, power and interest in a Blocked Account
at any time upon the occurrence and during the continuance of a Termination Event.

     (b) Prior to the Termination Date, all of the Collections deposited into the Blocked Accounts
shall be swept daily and transferred into the Company’s operating account, as designated by the
Company to the financial institution maintaining such Blocked Accounts and the Bank hereby directs
the Company to, no later than on the Business Day following the day on which Collections are
received in such operating account, pay, apply or reserve for payment, as the case may be, such
Collections as follows:

     (i) first, reserve for payment to the Bank at the next Settlement Date, an amount on
account of the Discount equal to the portion of the Discount accrued (calculated prior to
the Collections of Purchased Receivables being distributed in accordance with this Section
4.3(b)) to such day for all Settlement Periods, to the extent

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any part thereof has not been
previously paid to the Bank, and the Company agrees to hold such amount in trust for the
Bank;

     (ii) second, with respect to any Collections of Purchased Receivables which include any
Trade Credit Amounts owing to the Company, reserve for payment to the Company for such
corresponding Trade Credit Amounts; and

     (iii) third, reserve for payment to the Bank at the next Settlement Date the amount of
any Dilutions which may have accrued or been granted in relation to the relevant Receivables
that were not otherwise accounted for in the calculation of Purchase Price and all other
amounts which may be owing to the Bank under this Agreement or any other Transaction
Document; and

     (iv) fourth, subject to the conditions precedent to each purchase set out in this
Agreement, pay to or for the account of the Company, on the Bank’s behalf, the remaining
balance of such Collections (“Net Daily Collections”) for the purchase of all right, title
and interest of the Company in Replacement Receivables at the price determined in accordance
with Section 4.1.

     Notwithstanding the foregoing, the Bank may at any time upon the occurrence and during the
continuance of any Termination Event direct the Company to cease, and at all times after the
Termination Date, the Company shall cease, paying the Purchase Price for Replacement Receivables
title to which has not yet transferred to the Bank pursuant hereto with Net Daily Collections and,
in each case, the Company shall remit and hold all Collections (including, without limitation,
Collections received relating to Trade Credit Amounts) in the Blocked Accounts until the Final
Collection Date all in accordance with and subject to Section 18.4. The Company shall comply in
all respects with each such direction. The Company’s interest in any Collections relating to Trade
Credit Amounts or that it would otherwise receive as its servicing fee shall at all times following
the occurrence of a Termination Event be subordinate to the Bank’s interest in the Collections
until the Final Collection Date.

     (c) While the Company is acting in the capacity of Servicer, any amounts in respect of the
payment of any Discount or Net Daily Collections shall be deemed to have been paid to the Company
and deposited into the Blocked Account immediately upon receipt thereof by the Company.

     (d) Without limiting any other rights of the Bank, the Company may upon five Business Days
prior written notice to the Bank request (a “Reduction Request”) that (i) the Aggregate Amount for
any particular period(s) be decreased in increments of $5,000,000 so long as the Aggregate Amount
as so reduced is no less than the Funded Amount as of the date of such reduction and/or (ii) the
purchase of Replacement Receivables from Net Daily Collections be suspended until such time as the
then current Funded Amount is reduced to the Agreement
Amount stipulated in the Reduction Request. Upon the expiry of such five Business Days, if in the
Reduction Request the Company has requested a suspension of the purchase of Replacement
Receivables, Net Daily Collections shall not be used to pay for any purchase of any Receivables in
respect of which title has not already transferred to the Bank pursuant hereto but shall be

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retained in the Blocked Account until the Funded Amount is so reduced. Any amount so retained
shall be paid to the Bank on each Settlement Date following the date specified in the Reduction
Request until the Funded Amount is so reduced.

     (e) The Company agrees to give and grant all conveyances, assignments and transfers, by way of
sale of title to and ownership in the Purchased Receivables as may be necessary to give effect to
the purchases hereunder. Except as set forth in Section 21, at no time shall the Company have any
right, title or interest in or to, or be the owner of, any Purchased Receivable. If any action is
required to be taken to effect such conveyances, assignments and transfers, such action shall be
taken at the expense of the Company. For the avoidance of doubt, it is hereby confirmed that the
sale, assignment and transfer of Purchased Receivables pursuant hereto is intended to be absolute
and unconditional and is not intended by the parties to be and should not be construed as a loan or
the grant of collateral security for a loan.

     (f) The Bank agrees that at no time shall the Bank have any rights or interest in any Monsanto
Receivables and that the Company shall at all times be entitled to any collections deposited into
the Blocked Accounts related to Monsanto Receivables; provided, however, that if at any time after
the Termination Date, an Approved Debtor does not make a full payment on the Purchased Receivables
and the Monsanto Receivables and the Approved Debtor shall have not otherwise stated to which
accounts receivable the payment should be applied and the Company has notified the Bank that the
Company has not determined pursuant to the terms of this Agreement and the Monsanto Agreement as to
which accounts receivable the payment should be applied, the Bank agrees that such payment shall be
applied on a pro rata basis to the Purchased Receivables and the Monsanto Receivables of such
Approved Debtor.

     Section 4.4. (a) The Company and the Bank shall settle amounts owing as between them hereunder
on each Settlement Date.

     (b) The Company shall deliver to the Bank prior to the Closing Date the initial Portfolio
Report, in the form of a hard copy or electronically in a manner acceptable to the Bank, as at the
last day of the immediately preceding week.

     (c) Thereafter:

     (i) three Business Days prior to each Settlement Date; and

     (ii) within five Business Days following the Termination Date,

the Company shall deliver to the Bank, in the form of a hard copy or electronically in a manner
acceptable to the Bank, a Portfolio Report as at the following dates (or on the date otherwise
agreed between the Company and the Bank):

     (iii) as at the last day of the immediately preceding Settlement Period (in the case of
paragraph (i) above);

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     (iv) as at the Company’s close of business on the day immediately preceding the
Termination Date (in the case of paragraph (ii) above).

     (d) To the extent available from Collections, if, on any Settlement Date, the Outstanding Net
Amount of all Purchased Receivables as at the last day of the immediately preceding Settlement
Period is less than the Funded Amount as at such day, the Company shall immediately (and in any
event by not later than 10:00 a.m. (New York time) on the Business Day immediately following such
Settlement Date) pay to the Bank by a deposit in US Dollars to the Bank’s account the amount by
which the Funded Amount exceeds the Outstanding Net Amount of all Purchased Receivables as at such
Settlement Date.

     (e) If, on any Settlement Date, the Outstanding Net Amount of all Purchased Receivables as at
the last day of the immediately preceding Settlement Period is more than the Funded Amount as at
such day, the Bank shall, subject to the terms and conditions set forth in this Agreement, pay by
deposit to the Company’s operating account the amount by which the Outstanding Net Amount of all
Purchased Receivables exceeds the Funded Amount as set forth in the related Purchase Request.

     (f) On each Settlement Date, to the extent available from Collections:

     (i) the Company shall pay to the Bank by deposit to the Bank’s account an amount equal
to the portion of all Discount accrued (calculated prior to the Collections of Purchased
Receivables being distributed) to such Settlement Date for all Settlement Periods, to the
extent any part thereof has not been previously paid;

     (ii) the Company shall pay to the Bank by deposit to the Bank’s account an amount equal
to the aggregate amount of all Dilutions granted or accrued during the Settlement Period
ended on such Settlement Date that were not otherwise accounted for in the calculation of
Purchase Price; and

     (iii) to the extent that the Bank has received any Collections directly, so long as no
Termination Event has occurred, the Bank shall pay to the Company by deposit to the
Company’s operating account (as designated by the Company) an amount equal to the aggregate
amount of all Trade Credit Amounts that the Company is entitled to receive that have been
received by the Bank from such Collections.

     (g) At any time following the occurrence and continuation of a Termination Event, the Company
shall in any event on demand of the Bank pay to the Bank an amount equal to the amount by which the
Funded Amount at any time exceeds the Outstanding Net Amount of all Purchased Receivables at such
time. Such difference shall be paid by the Company to the Bank not later than the three Business
Days following notice from the Bank to the Company.

     Section 4.5. (a) On the date hereof, title to all currently existing Receivables of the
Approved Debtors set forth in the initial Portfolio Report originated by the Company shall,
ipso facto, and without any further action on the part of the Company or the Bank transfer to the
Bank to the extent necessary so that the Outstanding Net Amount of all Purchased Receivables is

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equal to the Funded Amount (such Funded Amount being calculated as if the initial Purchase had been
completed).

     (b) On each Business Day following the date hereof, title to all Receivables of the Approved
Debtors originated by the Company, and not already transferred to the Bank pursuant hereto, shall,
ipso facto, and without any further action on the part of the Company or the Bank, to the extent
necessary so that at all times the Outstanding Net Amount of all Purchased Receivables is equal to
the Funded Amount. If at any time the sale of all of the Receivables by the Company hereunder is
limited by the Agreement Amount and/or the applicable Debtor Sublimit, the Receivables of such
Approved Debtor originated by the Company that are otherwise purchased and sold hereunder up to
such limitations shall be deemed to be the Receivables of such Approved Debtor with the earliest
due date (based upon their net invoice value excluding all accruals for any discounts).

     Section 4.6. (a) The Company will from time to time within 5 days following any request,
furnish the Bank with a calculation of the amounts paid or held for or in trust for the Bank by the
Company under this Agreement.

     (b) The Company will provide the Bank with such other reports, information, documents, books
and records as the Bank may reasonably request and which may be lawfully disclosed or provided to
the Bank, including, without limitation, a certificate signed by its officers attesting to: the
balance owing on each Purchased Receivable, the maturity date of each Purchased Receivable and the
fact that the goods sold and/or services provided under the terms of the relevant Contracts were
shipped in accordance with the terms of such Contracts, a copy of the purchase order or sales order
and invoices relating to each Purchased Receivable, a copy of the bill of lading and any other
shipping document relating to the Purchased Receivable and all billings, statements, correspondence
and memoranda directed to the customer in relation to each Purchased Receivable and after the
Termination Date, a full accounting of daily Collections received.

     Section 4.7. The Bank is irrevocably authorized by the Company to keep records of all
purchases, which records shall be consistent with all information set forth in the Portfolio
Reports delivered to the Bank, and evidence the dates and amounts of purchases and the applicable
Discount in effect from time to time. Such records shall be presumptive evidence but the failure
to record any purchase shall not limit or otherwise affect any obligations of the Company hereunder
or the Debtor’s obligations to make payments on the Purchased Receivables when due.

     Section 4.8. The Company will, from time to time, at its expense, promptly execute and deliver
all instruments and documents and take all action that may be reasonably necessary and that the
Bank may reasonably request, in order to perfect, protect or more fully evidence the Bank’s
ownership of the Purchased Receivables, or to enable the Bank to exercise or enforce any of its
rights hereunder.

     Section 4.9. By effecting the payment under Section 4.1 and Section 4.2, the Bank shall
complete the purchase of all right, title and interest, whether now owned or hereafter acquired

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and wherever located, in, to and under such Purchased Receivables, without recourse, except as set
forth in Sections 5.2, 7.2, 7.4, 8 and 15. By accepting such payment, the Company shall be
conclusively deemed to sell, set over, assign, transfer and convey to the Bank and its successors
and assigns, without recourse, except as set forth in Sections 5.2, 7.2, 7.4, 8 and 15, all of its
right, title and interest in, to and under such Purchased Receivable.

     Section 4.10. Any payment by a Debtor in respect of any indebtedness owed by it to the Company
in respect of Purchased Receivables shall, except as otherwise specified by such Debtor or required
by the related Contract or law, be applied, first, as a Collection of any Purchased Receivable or
Purchased Receivables then outstanding of such Debtor in the order of the age of such Purchased
Receivables, starting with the oldest of such Purchased Receivables and, second, to any other
indebtedness of such Debtor to the Company in respect of Purchased Receivables. The Company shall
direct each Debtor to make all payments in respect of Purchased Receivables to a Blocked Account
which shall be a special segregated account under the control of the Bank or its affiliates.

Section 5. Limited Liability.

     Section 5.1. Except as set forth in Sections 5.2, 7.2, 7.4, 8 and 15, the purchase and sale of
Purchased Receivables under this Agreement shall be without recourse to the Company. The Company
and the Bank intend the transactions hereunder to constitute true sales of Purchased Receivables,
providing the Bank with the full risks and benefits of ownership of the Purchased Receivables (such
that the Purchased Receivables would not be property of the Company’s estate in the event of its
bankruptcy).

     Section 5.2. Deemed Collections/Repurchase Obligation.

          5.2.1 If a Repurchase Event with respect to a Purchased Receivable occurs under clause (ii) of
the definition thereof and the related reduction, adjustment, cancellation or setoff relates only
to a portion of the Outstanding Amount and not the entire Outstanding Amount, the Company shall be
deemed to have received on such day a Collection on such Purchased Receivable in the amount of such
reduction, adjustment, cancellation or setoff. All such Collections deemed received by the Company
under this Section 5.2.1 shall be remitted by the Company to such account, as directed by the Bank
in accordance with Section 6.1. On receipt of all amounts referred to above, the Bank shall (at
the cost and expense of the Company) execute such documents as may be necessary to re-assign that
portion of the applicable Purchased Receivables which represents the amounts so paid without
recourse, representation or warranty (except as to the title thereto by the Bank), to the Company.

          5.2.2 Except as set forth in Section 5.2.1 with respect to partial reductions, adjustments,
cancellations or setoffs of any Outstanding Amount, if a Purchased Receivable remains unpaid and a
Repurchase Event with respect to such Purchased Receivable has occurred, the Bank may, by written
notice, require the Company to pay to the Bank in respect of such Purchased Receivable, as directed
by the Bank, an amount equal to the Purchase Price of such

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Purchased Receivable (or so much of it as was paid by the Bank to the Company and remains unpaid),
less the amount of the unearned portion of the related Discount, if any, if such Purchased
Receivable is being repurchased by the Company prior to the due date of such Purchased Receivable
as computed pursuant to Section 4.1 hereof and if such Purchased Receivable is being repurchased by
the Company after the due date of such Purchased Receivable, together with interest thereon at the
interest rate specified in Section 7.6 from the due date to the date of the Company’ payment in
full thereof, and any other amounts then payable by the Company hereunder including breakage costs
under Section 7.4, whereupon such amount shall become due and payable from the Company to the Bank
on the date specified in such notice and shall be paid into an account specified by the Bank. On
receipt of all amounts referred to above, the Bank shall (at the cost and expense of the Company)
execute such documents as may be necessary to re-assign the applicable Purchased Receivables
without recourse, representation or warranty (except as to the title thereto by the Bank), to the
applicable account of the Company.

     Section 5.3. True Sale. It is the intention of the parties hereto that such purchase made
hereunder shall constitute a sale and assignment of the related Purchased Receivable (and not
merely a pledge), which sale and assignment is absolute, irrevocable and without recourse except as
set forth in Sections 5.2, 7.2, 7.4, 8 and 15 and shall provide the Bank with the full benefits of
ownership of such Purchased Receivable. In the event that, notwithstanding the intent of the
parties, such purchase is deemed by a court of competent jurisdiction to constitute a pledge rather
than a sale and assignment, the Company does hereby grant to the Bank, in order to secure all the
obligations of the Company to the Bank hereunder, a first priority security interest in, to and on,
the Purchased Receivables and the products and proceeds thereof including, without limitation, all
Collections, all Trade Credit Amounts, all Related Assets and all other monies, instruments,
securities, documents, investment property, financial assets and other property related to the
Purchased Receivables from time to time on deposit in or credited to the Blocked Accounts or any
other accounts and all other such property relating to the Purchased Receivables or any of them.

Section 6. The Company as Servicer and Agent of Bank.

     Section 6.1. Appointment of Servicer. Notwithstanding the sale of Purchased Receivables
pursuant to this Agreement, the Company shall continue to be responsible for the servicing and
administration of the Purchased Receivables sold by it as agent and trustee for the Bank, all on
the terms set out in this Agreement and, subject to the right of the Bank to terminate the Company
as servicer, agent and trustee pursuant to this Agreement at any time following the occurrence of a
Termination Event, subject to the termination provisions of Section 6.3. In its capacity as
servicer, the Company shall:

     (a) direct each Debtor of the Purchased Receivables to make all payments thereon to the
Blocked Accounts;

     (b) immediately pay over to the Blocked Accounts any Collections of Purchased
Receivables received by the Company which shall be received in trust for the Bank;

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     (c) promptly upon becoming aware thereof, to notify the Bank in the event that all or
any part of any Purchased Receivable is not paid in full on the Maturity Date thereof;

     (d) comply with the terms and provisions of Section 4 hereof with regard to
Collections, actions to be taken at each Settlement Date and the purchase of Replacement
Receivables; and

     (e) provide the Bank with a weekly reconciliation and Portfolio Report setting forth
the list of Purchased Receivables and reconciling Collections made to the Blocked Accounts
pursuant to paragraph (a) above in form and in substance as agreed upon between the Bank and
the Company.

     Section 6.2. Effect of Agency. The possession by the Company or its transferee or agent of
products or proceeds (including Collections) of any Purchased Receivable shall be deemed to be
“possession by the secured party” for purposes of perfecting such security interest pursuant to the
UCC or other applicable law. Notifications to persons holding such property, and acknowledgments,
receipts or confirmations from persons holding such property, shall be deemed to be notifications
to, or acknowledgments, receipts or confirmations from, bailees or agents (as applicable) of, the
Bank or its transferee for the purpose of perfecting such security interest under the UCC as in
force in the relevant jurisdiction and other applicable law.

     Section 6.3. Termination of Appointment. The Bank may at any time following the occurrence of
a Termination Event, or, immediately if upon the bankruptcy or insolvency of the Company or the
Parent (however evidenced), (i) at its discretion give notice to each Debtor and take any lawful
action to collect any Purchased Receivable sold from the Company directly from the respective
Debtor and (ii) by notice in writing terminate the appointment of the Company as its servicer and
agent for the servicing of Purchased Receivables, in which case the Company undertakes to the Bank
not to interfere with such servicing or collection of any Purchased Receivable nor attempt to
receive, nor itself make collection from the Debtor in respect of such Purchased Receivables. The
Company shall have the option to repurchase all, or any portion of, Purchased Receivables sold by
it upon any termination of the Company as servicer at the Repurchase Price as set forth in
Section 21.1, provided no bankruptcy or insolvency (however evidenced) has occurred with respect to
the Company or the Parent. The Company hereby grants and conveys to the Bank an irrevocable power
of attorney (coupled with an interest) authorizing and permitting the Bank, at its option, with or
without notice to the Company, to do any one of the following: (a) endorsing the name of the
Company upon any checks or other Receivables, (b) endorsing the name of the Company on any freight
or express bill or bill of lading relating to any Purchased Receivables; (c) taking all action as
the Bank deems appropriate, including, without limitation, the execution and filing of financing
statements in the name of and on behalf of the Company to perfect any of the security interests
granted to the Bank herein. The Company agrees that neither the Bank nor the attorney-in-fact will
be liable for any acts of
commission or omission nor for any error of judgment or mistake of fact or law except to the extent
the same constitutes gross negligence or willful misconduct.

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     Section 6.4. Company Books and Records. The Company shall maintain its applicable books and
records, including but not limited to any computer files and master data processing records, or
written records thereof, so that such records that refer to Purchased Receivables sold hereunder
shall indicate clearly that the Company’s right, title and interest in such Receivables have been
sold to the Bank. Indication of the Bank’s ownership of Purchased Receivables shall be deleted
from or modified on the Company’s records when, and only when, the Purchased Receivables shall have
been paid in full or the Bank’s ownership of such Receivables shall have been repurchased by the
Company from the Bank.

Section 7. Payments.

     Section 7.1. Place and Time.

          7.1.1. All payments to be made by the Company to the Bank pursuant to this Agreement shall be
made on the date such amount is due by not later than 12:00 noon (eastern standard time at the
place of payment) to such account as specified by the Bank.

          7.1.2. All payments to be made by the Bank pursuant to this Agreement shall be made on the
date such amount is due by not later than 3:00 p.m. (eastern standard time at the place of payment)
to the account of the Company notified to the Bank by the Company.

     Section 7.2. Deduction; Withholding; Grossing Up.

          7.2.1. Subject to Section 7.2.2, all sums payable by the Company to the Bank pursuant to or in
connection with any Transaction Document shall be paid in full, free and clear of all deductions,
set-off or withholdings whatsoever except only as may be required by law.

          7.2.2. If any deduction or withholding is required by law in respect of any payment due from
the Company to the Bank pursuant to or in connection with any Transaction Document, the Company
shall:

     (a) ensure that the deduction or withholding is made and that it does not exceed the
minimum legal requirement;

     (b) pay, or procure the payment of, the full amount deducted or withheld to the
relevant taxation or other authority in accordance with the applicable law;

     (c) increase the payment in respect of which the deduction or withholding is required
so that the net amount received by the Bank after the deduction or withholding (and after
taking account of any further deduction or withholding which is required to be made as a
consequence of the increase) shall be equal to the amount which the payee would have been
entitled to receive in the absence of any requirement to make any deduction or withholding;
and

     (d) promptly deliver or procure the delivery to the Bank of receipts evidencing each
deduction or withholding which has been made.

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     Section 7.3. Payments in Dollars. All payments to be made by the Company and the Debtors in
respect of a Purchased Receivable, whether of interest or principal, shall be made in Dollars.

     Section 7.4. Breakage Cost Indemnity. The Company agrees to indemnify the Bank on demand
against any loss or expense (including, but not limited to, any loss of the Margin or any other
loss or expense sustained or incurred or to be sustained or incurred by the Bank in liquidating or
employing deposits acquired or contracted for to effect or maintain its acquisition of Purchased
Receivables or any part thereof) which the Bank has sustained or incurred as a consequence of (i) a
purchase of Receivables not being made following the delivery of any Purchase Request to the Bank
by reason of the non-fulfillment of any of the conditions precedent or otherwise or (ii) a
repurchase of Purchased Receivables by the Company prior to the end of the applicable Reset Period.

     Section 7.5. Business Days. Any amounts which but for this Section 7.5 would fall due for
payment under this Agreement on a day other than a Business Day shall be payable on the succeeding
Business Day unless such Business Day would fall into a new calendar month, then such payment shall
be due on the preceding Business Day. Interest calculations shall, where necessary, be adjusted
accordingly.

     Section 7.6. Default Interest.

          7.6.1. In the event that any amount payable by the Company hereunder or under any of the other
Transaction Documents (including, without limitation, payment of Collections not paid to the Bank
when received) remains unpaid for five (5) Business Days after the Bank provides notice to the
Company that such amounts are past due, the Bank shall charge, and the Company shall pay, interest
(“Default Interest”) from time to time on any such unpaid amount due from the Company to the Bank
during the period from (and including) the due date thereof to, but excluding the date payment is
received by the Bank in full, at a rate equal to the aggregate of (i) the prime commercial rate as
from time to time quoted by the Bank, and (ii) 2% per annum.

          7.6.2. Such Default Interest shall be payable ON DEMAND and, if no prior demand is made, on
the last Business Day of each calendar month. The Bank is authorized to charge any such amount of
Default Interest due to any account of the Company on the books of the Bank or any affiliate
thereof and to deduct any such amount from any amount which would otherwise be due from the Bank to
the Company from time to time under this Agreement.

Section 8. Changes in Circumstances.

     Section 8.1. Increased Costs.

          8.1.1. The Company, shall, within three Business Days of a demand by the Bank, pay the amount
of any Increased Costs incurred by the Bank as a result of (i) the introduction of
or any change in (or in the interpretation, administration or application of) any law or regulation
or (ii) compliance with any law or regulation made after the date of this Agreement.

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          8.1.2. In this Agreement “Increased Costs” means (i) a reduction in the rate of return for the
Bank from the transactions contemplated in the Transaction Documents or on the Bank’s overall
capital; (ii) an additional or increased cost imposed by regulatory or administrative action; or
(iii) a reduction of any amount due and payable under any Transaction Document or by the Debtor
under the Purchased Receivables, which in each case is incurred or suffered by the Bank to the
extent that it is attributable to the Bank having entered into any Transaction Document or funding
any purchase of Purchased Receivables or being exposed to any Debtor in respect of Purchased
Receivables and/or performing any of its obligations under any Transaction Document.

     Section 8.2. Increased Cost Claims.

          8.2.1. If the Bank intends to make a claim pursuant to Section 8.1 (“Increased Costs”) it
shall notify the Company of the event giving rise to such claim and provide a certificate
confirming the amount of its Increased Costs.

     Section 8.3. Exceptions.

          8.3.1. Section 8.2 does not apply to the extent any Increased Cost is (i) attributable to a
Tax Deduction required by law to be made by the Company, (ii) compensated for by Section 7.2; or
(iii) attributable to the willful breach by the Bank of any law or regulation; or (iv) attributable
to increased costs as a result of the income tax, franchise tax or similar obligations of the Bank.

     In this Section 8.3 a “Tax Deduction” means a deduction or withholding for or on account of
Tax from a payment under a Transaction Document.

Section 9. Further Assurances.

     Section 9.1. The Company agrees that from time to time, at its expense, it will promptly
execute and deliver all further instruments and documents, and take all further action, that the
Bank may reasonably request in order to perfect, protect or more fully evidence the transactions
contemplated hereby, or to enable the Bank to exercise or enforce any of its rights with respect to
the Purchased Receivables. Without limiting the generality of the foregoing, upon the request of
the Bank, the Company will file such financing or continuation statements, or amendments thereto or
assignments thereof, and such other instruments or notices as required under U.S. or local law, as
may be necessary or appropriate to perfect and preserve the interests of the Bank in the Purchased
Receivables, free and clear of Adverse Claims.

     Section 9.2. The Company hereby authorizes the Bank or its designee to file one or more
financing or continuation statements, and amendments thereto and assignments thereof and such other
instruments or notices as referred to in Section 9.1, relative to all or any of the Purchased
Receivables now existing or hereafter arising in the name of the Company.

-20-

 

Section 10. Representations and Warranties.

     Section 10. General Representations and Warranties. The Company hereby makes, and on each
purchase date and Settlement Date shall be deemed to make, the following representations and
warranties for the benefit of the Bank as of the Closing Date and each subsequent purchase date and
Settlement Date with reference to the facts and circumstances then existing (with the understanding
that, with respect to any such representation or warranty which relates to any Purchased
Receivable, such representations and warranties are deemed to have been made by the Company only as
of the date of the purchase of such Purchased Receivable by the Bank):

     (a) It is duly organized and validly existing and registered under the laws of its
jurisdiction of organization and has the full right, power and authority to own its property
and assets and carry on its business as it is now being conducted, to enter into the
Transaction Documents, to perform and observe all of the matters and things provided for
therein, including the sale to the Bank of the Purchased Receivables and it has taken all
necessary steps to duly authorize the execution of this Agreement and the other Transaction
Documents and the transactions contemplated hereby.

     (b) This Agreement and each other Transaction Document has been duly authorized by the
Company and executed and delivered by the proper officer(s) of the Company and constitute
or, as the case may be, will, when made, constitute its legal, valid and binding obligations
enforceable in accordance with its terms.

     (c) The Company is the legal and beneficial owner of each Purchased Receivable sold by
it and, on the date of the sale of the Purchased Receivables to the Bank, the Purchased
Receivables shall be transferred to the Bank free and clear as of the date of such sale, of
any Adverse Claim.

     (d) Each Purchased Receivable is generated from a sale to an Approved Debtor and shall
be freely assignable and shall constitute amounts due and payable by the Debtor on the
relevant Maturity Date (which shall not exceed 90 days from the earliest of (i) the date of
sale or (ii) dispatch of the goods by the Company) and each Contract, Purchased Receivable
and Invoice complies in all material respects with all applicable laws and regulations.

     (e) The making and performance of this Agreement and each Transaction Document and the
transactions contemplated hereby will not (as to the best of the Company’s knowledge as to
(i)) violate any provision of (i) any law, regulation, order or decree of any governmental
authority, agency or court or (ii) its organizational documents or (iii) any agreement,
mortgage, indenture or other agreement to which it is a party or affecting the Company or
any of its assets or properties nor will such making and performance with or without the
passage of time or the giving of notice or other conditions, constitute an event of default
or termination event (howsoever described) under any of the foregoing or result in the
creation, imposition or enforceability of any Encumbrance over any of its assets, except in
favor of the Bank.

-21-

 

     (f) Each Invoice as issued in respect of each Purchased Receivable sold by it was
properly issued in accordance with the Contract and evidences that the amount specified in
such invoice will be due and payable to the Company in Dollars on and as of the Purchase
Date without the need for any other action, delivery of goods or performance of services by
the Company with respect to the Outstanding Amount set forth in such Invoice.

     (g) Each Contract and Receivable was originated in the ordinary course of the Company’s
business and in accordance with the Company’s credit and collection policy.

     (h) The Company has performed all of its material obligations under the Contract
relating to Purchased Receivables and in particular and without limitation it has delivered
all goods and services to the country of the Debtor as are due and required under such
Contract with respect to the face amount set forth in such Invoice.

     (i) The obligations of the Debtor in respect of each Purchased Receivable have not, as
of the date of the Bank’s purchase thereof, been prepaid in whole or in part.

     (j) As of the date the sale of such Receivable to the Bank, the goods supplied under
the Contract giving rise thereto are not subject to any retention of title or equivalent
clauses exercisable by the Company or, to the Company’s knowledge, any third parties, which
may adversely affect the interests of the Bank and at the time of sale by the Company to the
Bank, no Purchased Receivable is subject to a volume or other discount (except to the extent
that the amount of any Trade Credit Amount has already been taken into account in
determining the Funded Amount of the Purchased Receivable as set forth in the Portfolio
Report) or subject to any claim by, or dispute with, the Debtor.

     (k) As of the date the sale of such Receivable to the Bank, each applicable Contract
giving rise thereto is in full force and effect as of such date, and the Company is not in
breach thereof or in default thereunder in a manner that would result in the Debtor being
entitled to exercise any set off rights or counterclaim or to withhold, extend or delay
payment on any Purchased Receivable; and, as of such date, there are no disputes, offsets,
counterclaims or defenses of the Debtor known to the Company with respect to any Purchased
Receivable (if any Purchased Receivable is more than 60 days past due, other than as a
result of a Debtor’s Financial Inability to Pay, it shall be presumed that the Debtor has
asserted a contractual claim or dispute).

     (l) Under the laws of or applicable to the jurisdiction of its organization in force
as at the date hereof, the claims of the Bank against the Company in relation to each
Purchased Receivable will rank at least pari passu with the claims of all its other
unsecured creditors save those whose claims are preferred solely by any bankruptcy,
insolvency, liquidation or other similar laws of general application.

     (m) Under the laws of or applicable to the jurisdiction of organization in force as at
the date hereof, the Company will not be required to make any deduction or withholding from
any payment it makes to the Bank in respect of any Purchased

-22-

 

Receivable or the Contract giving rise thereto, and the Company has all consents and
licenses necessary to perform its obligations thereunder.

     (n) As of the date the sale of such Receivable to the Bank, neither the Company nor, to
the actual knowledge of the Company, any Approved Debtor, is insolvent nor has any
insolvency or bankruptcy event occurred with respect to the Company or such Debtor, nor is
the Debtor past due under any payment obligation to the Company with respect to any related
Purchased Receivable nor has the Debtor rescheduled or extended the due date of any such
Purchased Receivable.

     (o) The Company has indicated, or will indicate as of the date of such sale, on its
books and records, as appropriate, that the Purchased Receivables have been sold by the
Company to the Bank (or its successors and assigns).

     (p) The transactions contemplated by this Agreement are being consummated by the
Company in order to raise capital to carry out the Company’s ordinary business, with no
contemplation of being or becoming insolvent and with no intent to hinder, delay or defraud
any of its present or future creditors. By virtue of the Company’s right to receive any
payment of the Purchase Price for each Purchased Receivable as provided in Section 4 hereof,
the Company has received reasonably equivalent value for the Purchased Receivables sold by
it.

     (q) On the date of the sale of each Purchased Receivable by the Bank, the Bank shall
acquire a valid ownership interest or a first perfected security interest in each Purchased
Receivable free and clear of any Adverse Claim; and, upon transfer of ownership of such
Purchased Receivable from the Company to the Bank, no financing statement or other similar
instrument or other filing or recordation covering any such Purchased Receivable or any
interest therein, is on file in any recording office except such as may be filed pursuant to
this Agreement or except as to which a release or disclaimer in form satisfactory to the
Bank has been provided, or as to which the Bank has consented.

     (r) The Company’s jurisdiction of organization and “location” for purposes of the UCC,
or other relevant local law, is the State of Ohio (or at such other location, notified to
the Bank in accordance with Section 11.1(n)), in a jurisdiction where all actions required
by Section 9.1 have been completed). Except as described in Schedule 3, (i) the Company has
no trade names, fictitious names, assumed names or “doing business as” names and (ii) the
Company has not changed its jurisdiction of organization or location or its name, identity
or corporate structure within the four months prior to the date of this Agreement. The
Company’s federal taxpayer identification number or other registration number is as set
forth in Schedule 3.

     (s) All information provided by the Company to the Bank with respect to the Purchased
Receivables (including without limitation relating to the applicable Debtor’s past payment
history and commercial relationship with such Debtor) is true and accurate in all material
respects and nothing has been given or withheld that would result in the information
provided being untrue or misleading in any material respect.

-23-

 

     (t) The representations made or deemed to be made by the Company in each Transaction
Document are and remain correct in all material respects as of the date made.

     (u) With respect to the Company’s obligations hereunder, no consent, license,
authorization, registration, legalization, notification to, declaration with, approval or
permit of, any governmental authority, agency or instrumentality (including any central
banking or other monetary authority) is required by the Company in connection with its
execution, delivery and performance, and the validity or enforceability of the Company’s
obligations under the Transaction Documents, the Company’s sale of the Purchased
Receivables, or the transactions contemplated thereby.

     (v) The sale of the Purchased Receivables by the Company to the Bank under the
Transaction Documents would, under the law applicable to the Company as of the date of the
sale thereof, constitute a true sale or other absolute transfer of the Purchased Receivables
by the Company (except to the extent set forth in Section 21) to the Bank and upon each
purchase by the Bank, the Bank shall acquire a legally valid ownership interest or a first
perfected security interest in each Purchased Receivable, free and clear of any lien, claim
or other encumbrance without any need on the part of the Company or the Bank to (i) except
as may be required under the applicable Contracts, notify the account debtors on the
Purchased Receivables or (ii) except as may be required under applicable disclosure
requirements, file, register or record the Transaction Documents or the sale of the
Purchased Receivables under the laws applicable to the Company.

     (w) The obligation of the Company to remit payments received from the Debtors on the
Purchased Receivables in U.S. dollars to the Bank in the United States, either directly or
through the Blocked Accounts as designated by the Bank is legally valid under the laws
applicable to the Company and no foreign exchange registrations or approvals are necessary
to effectuate such U.S. dollar payments.

Section 11. Covenants.

     Section 11. General Covenants. The Company hereby agrees, at all times prior to the Final
Collection Date:

     (a) to duly perform all its obligations under the relevant Contract in respect of each
Purchased Receivable, so that each such Receivable remains a legal, valid and binding
obligation of the Debtor enforceable against the Debtor in accordance with its terms, to
inform the Bank of any material breach or default by the Company or the Debtor, within five
Business Days after it becomes aware of any such breach or default and to take all measures
necessary and consistent with the terms of the Contract to minimize or prevent any loss
which may be incurred by the Bank in the event of nonperformance of the Contract or
nonpayment of an invoice by the Company or the Debtor arising out of a dispute between the
Company and the Debtor thereunder;

     (b) after the date of the Company’s sale of the related Purchased Receivable, not to
amend any applicable Contract related thereto in any manner or have any dealing or other
arrangement with the Debtor that, as between the Company and the Debtor, is

-24-

 

intended to, or will, affect the collectibility of the Purchased Receivable or the
Outstanding Amount or the due date for payment of any Purchased Receivable, cancel or
terminate such Contract and not to, or purport to, terminate, revoke or vary any term or
condition of or extend the Maturity Date by more than 30 days (so long as in no event shall
the Maturity Date be extended beyond 90 days from the date of purchase of such Purchased
Receivable) of any Purchased Receivable without the prior consent in writing of the Bank, if
the same could adversely affect the financial value or economic return to the Bank in
respect of the Purchased Receivable;

     (c) not to create or suffer to exist any Adverse Claim over all or any of the Company’s
rights, title and interest in and to any Purchased Receivable or the Contract in respect of
such Purchased Receivable or any lock-box or other account to which any Collections of any
Purchased Receivables are sent (unless otherwise agreed to by the Bank) and not to, or
purport to, assign, transfer or otherwise deal with any of its rights in respect of any such
Contract or any Purchased Receivable other than in favor of the Bank, and Company shall
provide the Bank with a release or disclaimer of any Adverse Claim purportedly created by
any other Person over any Purchased Receivable;

     (d) to ensure that it has shipped all goods in respect of each Purchased Receivable in
conformity with all applicable laws and regulations (including without limitation import and
export laws and regulations);

     (e) to keep and maintain proper accounts and Sales Records and Invoices in connection
with each Purchased Receivable in an up to date form (including details of each Invoice
specified in the Portfolio Report) and ensure that they are retained in suitable storage and
that they indicate:

     (i) which Receivables are Purchased Receivables;

     (ii) details of all Purchased Receivables which are specified in the Portfolio
Reports; and

     (iii) that such Purchased Receivables have been sold to the Bank, and to
provide the Bank with a quarterly report regarding a receivables aging, delinquency,
write-offs, Receivables rolled forward and dilution report in the form attached as
Appendix I as to the Purchased Receivables showing a loss to liquidation ratio
(monthly write-offs over collections), delinquency ratio (Receivables more than 90
days past due over closing Receivables balance) and dilution ratio (monthly credit
memos over sales) within 5 days of the close of each month in a form satisfactory to
the Bank, or as may otherwise be approved by the Bank;

     (f) to devote and assure that there is devoted to the servicing of Purchased
Receivables at least the same amount of time and attention and that there is exercised at
least the same level of skill, care and diligence in their servicing, as if it were
servicing those receivables legally and beneficially owned by it;

-25-

 

     (g) to comply with any reasonable directions, orders and instructions (including any
procedures for the administration and commencement and continuation of legal or other
proceedings against the Debtor to enforce payment of Purchased Receivables) given by the
Bank and to take such action on the Bank’s behalf as the Bank may request to procure the
ordinary course collection of such accounts as directed by the Bank;

     (h) to use all reasonable efforts to recover and enforce payment of any or all
Purchased Receivables and provide such reasonably requested information as to assist the
Bank to recover and enforce payment of any or all Purchased Receivables (including at the
request of the Bank joining in and being a party to any legal or other action which the Bank
has taken or wishes to take against the Debtor with the Bank being entitled to full control
of such action);

     (i) to take such action as may reasonably be required by applicable law to perfect a
full legal assignment to the Bank of such Purchased Receivable, such that, among other
things, the Bank shall be entitled to receive or take action to recover all Purchased
Receivables outstanding from the Debtor without the Company being required to join in, being
a party to or taking in its own name legal action against the Debtor;

     (j) upon the reasonable request of the Bank, to mark its accounting records evidencing
or relating to the Purchased Receivables with a legend evidencing that the Purchased
Receivables have been sold in accordance with this Agreement;

     (k) to provide information and reports as reasonably requested by the Bank reasonably
related to the transactions contemplated by this Agreement, of which information and reports
shall be complete and accurate in all material respects, including without limitation,
annual audited financial statements for the Company and its consolidated subsidiaries within
120 days after the end of each fiscal year or as soon as available if earlier and unaudited
financial statements for the Company and its consolidated subsidiaries within 60 days after
the end of each fiscal quarter or as soon as available if earlier;

     (l) (i) at any time during regular business hours and upon reasonable prior notice, to
permit the Bank or any of its agents or representatives, (A) to examine and make copies of
and abstracts from the Company’s records relating to Purchased Receivables, including the
Contracts and Sales Records, and (B) to visit the offices and properties of the Company for
the purpose of examining such records and to discuss matters relating to Purchased
Receivables or the Company’ performance hereunder with any of the officers or employees of
the Company having knowledge of such matters; and (ii) without limiting the provisions of
clause (i), from time to time on request of the Bank, permit certified public accountants or
other auditors acceptable to the Bank to conduct, at the Company’s expense, a review of the
Company’s books and records; provided that such examinations, visits and reviews by the Bank
or accountants shall occur no more than once a year during any period of time that there is
no default by the Company of its obligations hereunder; and

-26-

 

     (m) to keep its jurisdiction of organization and chief executive office at the location
referred to in Schedule 3 or, upon 30 days’ prior written notice to the Bank, at such other
location in a jurisdiction where all action required by Section 9.1 shall have been
completed; and not change its name except upon like notice and after all action required by
Section 9.1 shall have been completed.

Section 12. Partial Invalidity

     If at any time any provision of the Transaction Documents shall be adjudged by any court or
other competent tribunal to be illegal, invalid or unenforceable, the validity, legality, and
enforceability of the remaining provisions hereof shall not in any way be affected or impaired nor
shall the legality, validity or enforceability of such provisions under the law of any other
jurisdiction be in any way affected or impaired thereby and the parties hereto will use their best
efforts to revise the invalid provision so as to render it enforceable in accordance with the
intention expressed in this Agreement.

Section 13. No Bank Liability for Contract

     The Company hereby acknowledges and agrees that the Bank shall not be in any way responsible
for the performance of any Contract and the Bank shall not have any obligation to intervene in any
dispute arising out of the performance of any Contract. Any claim which the Company may have
against any Debtor or any other party, including any successors or assignees, and/or the failure of
the Debtor to fulfill its respective obligations under each Contract shall not affect the
obligations of the Company to perform its obligations and make payments under this Agreement and
shall not be used as a defense or as set-off, counterclaim or cross-complaint as against the
performance or payment of any of its obligations.

Section 14. Notices, Addresses, Language

     Section 14.1 Notices, Addresses. (a) All notices, requests and demands given or made under the
Transaction Documents shall be given or made in writing and unless otherwise stated shall be made
by telefax or letter using the address as specified below or such other address as the party may
designate to the other party:

	 	 	 	 	 
	 

	 	To the Company
	 	The Scotts Company LLC
	 

	 	          or the Parent:	 	 
	 

	 	Attention:
	 	Treasurer
	 

	 	Street Address:
	 	14111 Scottslawn Road
	 

	 	 	 	Marysville, Ohio 43041
	 

	 	Facsimile:
	 	937-578-5754

-27-

 

	 	 	 	 	 
	 

	 	To the Bank:
	 	Bank of America, N.A.
	 

	 	Attention:
	 	Michael Delaney
	 

	 	Street Address:
	 	231 South LaSalle Street, 10th Floor
	 

	 	 	 	Chicago, Illinois 60604
	 

	 	Facsimile:
	 	415-503-5114
	 
	 	 	 	 
	 

	 	With a Copy to:
	 	Bank of America, N.A.
	 

	 	Attention:
	 	Florette Lauer
	 

	 	Street Address:
	 	1000 W. Temple Street
	 

	 	 	 	Los Angeles, CA 90012
	 

	 	Facsimile:
	 	213-580-8362

     (b) All notices, requests and demands shall be deemed to have been duly given or made when
dispatched by telefax when the confirmation showing the completed transmission received or, if
mailed via a reputable international courier, when it has been left at the relevant address or five
(5) Business Days after being delivered to such reputable international courier, in an envelope
addressed to the applicable person at that address and to the attention of the person(s) set forth
above.

     (c) The Company and the Bank shall promptly inform each other of any changes in their
respective addresses or facsimile numbers specified hereabove.

     Section 14.2. English Language. Each communication and document made or delivered by one
party to another pursuant to this Agreement shall be in the English language or accompanied by a
translation thereof into English (certified by an officer of the person making or delivering the
same) as being a true and accurate translation thereof.

Section 15. Fees, Costs and Indemnity.

     Section 15.1. Fees. (a) The Company shall also pay to the Bank on the date of each purchase
hereunder an administrative fee equal to 0.05% per annum (computed on the basis of a year of
360-days and actual days elapsed) on the Outstanding Amount of the Purchased Receivables.

     (b) The Company shall also pay to the Bank a fee equal to 0.125% per annum (computed on the
basis of a year of 360 days and actual days elapsed) on the amount by which the daily average of
the Agreement Amount exceeds the daily average of the Funded Amount, such fee to be
payable annually in arrears on each April 10 (commencing April 10, 2009) and on the Termination
Date, provided, however, that if the annual average daily Funded Amount during the preceding period
shall be 75% or more of the average daily Agreement Amount, such fee shall be waived by the Bank as
to such period.

     (c) The Company shall also pay to the Bank on the Termination Date a termination fee if the
Termination Date occurs prior to April 8, 2009, as a result of the Company exercising its

-28-

 

voluntary right to terminate by designating a Termination Date hereunder in an amount equal to the
lesser of (i) $120,000 and (ii) 0.125% times the daily average Agreement Amount for the period from
the Termination Date through April 8, 2009.

     Section 15.2. Costs and Expenses. All costs, charges and expenses, including reasonable fees
and expenses of legal counsel, audit and due diligence expenses, in relation to the preparation,
execution and enforcement of the Transaction Documents and each Purchased Receivable by the Bank
shall be paid by the Company to the Bank on demand on a full indemnity basis whether or not any
Receivables are purchased hereunder.

     Section 15.3. Duties and Taxes. All stamp, documentary, registration or other like Taxes
(excluding taxes upon or measured by the net income of the Bank), including withholding taxes and
any penalties, additions, fines, surcharges or interest relating thereto, or any notarial fees
which are imposed or chargeable on or in connection with this Agreement or any other Transaction
Document or any other document executed pursuant hereto or thereto shall be paid by the Company, it
being understood and agreed that the Bank shall be entitled but not obliged to pay any such Taxes
(whether or not they are its primary responsibility), and the Company, jointly and severally, shall
on demand indemnify the Bank against those Taxes and against any costs and expenses so incurred by
it in discharging them.

     Section 15.4. Indemnity. The Company agrees to indemnify, defend and save harmless the Bank
(including each of its branches, affiliates, officers, directors, employees or other agents, the
“Indemnified Party”), other than for such Indemnified Party’s own gross negligence or wilful
misconduct, forthwith on demand, from and against any and all related losses, claims, damages,
liabilities, costs and expenses (including, without limitation, all attorneys’ fees and expenses,
expenses incurred by their respective credit recovery groups (or any successors thereto) and
expenses of settlement, litigation or preparation therefor) which any Indemnified Party may incur
or which may be asserted against any Indemnified Party by any person (including, without
limitation, any Debtor or any other person whether on its own behalf or derivatively on behalf of
the Company) arising from or incurred in connection with any of the following events:

     (i) the failure to vest in the Bank a first priority perfected ownership interest or
security interest in each Purchased Receivable, free and clear of any Adverse Claim;

     (ii) the commingling by the Company of Collections of Purchased Receivables at any time
with other funds of the Company or other Person, provided that the Bank hereby acknowledges
the lien on the Collections deposited in the Blocked Accounts of Receivables not sold under
this Agreement of JPMorgan Chase Bank, N.A., as Administration Agent under the terms of the
Credit Agreement, or the failure of the Company to direct any Debtor to make payment on
Purchased Receivables to the Blocked Account;

     (iii) any representation or warranty made by the Company pursuant to this Agreement is
inaccurate, incorrect or untrue in any material respect;

-29-

 

     (iv) any failure of the Company to perform any of its duties or obligations hereunder;
or the violation of any applicable law, rule or regulation with respect to any Purchased
Receivable or the related Contract;

     (v) for failure to promptly execute when reasonably requested to do so by the Bank, of
any document or instrument confirming the sale to the Bank under applicable law with respect
to the Purchased Receivables;

     (vi) (1) any claim or dispute resulting from the sale of the merchandise or services
related to any Purchased Receivable or the furnishing or failure to furnish such merchandise
or services including, without limitation, any discount (other than a discount already taken
into account in determining the Purchase Price of a Purchased Receivable as set forth in a
Portfolio Report), (2) any adjustment, offset, withholding tax, deduction, counterclaim,
warranty issue or refusal of an Approved Debtor to pay not arising from the Financial
Inability to Pay of such Debtor; or (3) any products liability claim arising out of or in
connection with merchandise or services that are the subject of any Purchased Receivable (if
any Receivable is more than 60 days past due, other than as a result of the Financial
Inability to Pay of the Debtor, it shall be presumed that such Debtor has asserted a
contractual claim or dispute);

     (vii) any tax or governmental fee or charge (but not including taxes upon or measured
by net income of the Bank), all interest and penalties thereon or with respect thereto, and
all out-of-pocket costs and expenses, including the reasonable fees and expenses of counsel
in defending against the same, which may arise by reason of any act or omission by the
Company with respect to the purchase or ownership of any Purchased Receivable or in any
goods which secure any Purchased Receivable;

     (viii) any investigation, litigation or proceeding related to any act or omission by
the Company with respect to this Agreement or the transactions contemplated hereby except to
the extent that such investigation, litigation or proceeding arises due to the Bank’s gross
negligence or willful misconduct;

     (ix) any material defect in authenticity or any material discrepancy between the
records at the Company in respect of the Purchased Receivables or the documents issued by
the Company supporting the Purchased Receivables and the information provided to the Bank by
the Company or any failure by the Company to provide the Bank with information regarding the
Purchased Receivables;

     (x) any claim or dispute arising out of or in connection with the Monsanto Agreement;
and

     (xi) any and all reasonable out-of-pocket costs and expenses, including reasonable
legal fees and court costs, incurred by the Bank in enforcing the obligations of the Company
under this Agreement and the other Transaction Documents;

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provided that nothing in this Section 15.4 shall be deemed to provide indemnity to the Bank for credit losses resulting from the Financial Inability to Pay of any Debtor.

Section 16. Calculations and Certificate.

     Section 16.1. Accounts. Absent manifest error in any litigation or arbitration proceedings
arising out of or in connection with a Transaction Document or a Purchased Receivable, the entries
made in the accounts maintained by the Bank are presumptive evidence of the matters to which they
relate.

     Section 16.2. Certificates and Determinations. Any certification or determination by the Bank
of a rate or amount under any Transaction Document is, in the absence of manifest error, conclusive
evidence of the matters to which it relates.

Section 17. Set-Off. 

     The Company hereby authorizes the Bank to apply any credit balance (in whatever currency
denominated) on any account of the Company with the Bank or any affiliate of the Bank in
satisfaction of any sum due and payable by the Company pursuant to the terms of this Agreement.
For this purpose the Bank is authorized to purchase at its spot rate of exchange with the moneys
standing to the credit of any such account Dollars or such other currencies as may be necessary to
effect such application.

Section 18. Termination.

     Section 18.1. The following events or occurrences shall constitute Termination Events:

          (a) the Company or the Parent shall fail to pay, within five (5) calendar days of the
date when due, any amount greater than $100,000 under this Agreement, including, without
limitation, amounts payable by the Company in its capacity as servicer or under the
indemnity for breaches of any warranties or covenants contained in this Agreement;

          (b) the Company or the Parent is in default (i) beyond the period of grace, if any, in
the payment of any indebtedness exceeding $25,000,000, or (ii) under any agreement or
instrument relating to any such indebtedness the result of which would allow the holder
thereof to accelerate the payment of such indebtedness prior to its stated maturity;

          (c) the Company or the Parent (i) shall generally fail to pay its debts as they become
due, (ii) has commenced against it any bankruptcy or insolvency proceeding which is not
dismissed within 60 days or commences any bankruptcy or insolvency proceeding, (iii) has any
receiver, trustee, liquidator or other similar person appointed for itself or a substantial
portion of its property or (iv) takes any action to effectuate or authorize any of the
foregoing;

-31-

 

          (d) any Adverse Claim shall occur as to any of the Purchased Receivables or proceeds
thereof, which results in Collections thereof being reduced by an amount in excess of 10% of
the Funded Amount thereof;

          (e) (i) the Company or Parent, as applicable, breaches any covenant set forth in
Section 4, 5.2, 6.1, 9.1, 15.4 or 22(a) of this Agreement and such breach shall continue for
fifteen (15) calendar days after a responsible officer of the Company has knowledge thereof,
(ii) the Company breaches any covenant set forth in Section 11(c), (g), (i), (k), (l), or
(m) of this Agreement and such breach shall continue for thirty (30) calendar days after a
responsible officer of the Company has knowledge thereof or (iii) the Company breaches any
covenant set forth in Section 11(h) of this Agreement or any similar covenant which
requires, or upon the request of the Bank would require, the Company to file or join in any
lawsuit against, or take any other legal action against, any Approved Debtor and such breach
shall continue for thirty (30) calendar days after a responsible officer of the Company has
knowledge thereof;

          (f) the failure of the Company and the Bank to mutually agree to a more frequent
Settlement Period within five (5) calendar days of the Company’s receipt of written request
from the Bank;

          (g) the failure by the Parent to own 100% of the outstanding equity interests of the
Company;

          (h) default in the due observance or performance by the Parent of the covenant set
forth in Section 22(b) of this Agreement;

          (i) the issuance by Moody’s or S&P of three or more Downgrades of its rating of an
Approved Debtor (other than Home Depot, Inc.) or the suspension or withdrawal of its rating
of such Approved Debtor or the issuance by Moody’s or S&P of two or more Downgrades of its
rating of Home Depot, Inc. or the suspension or withdrawal of such rating;

          (j) an Approved Debtor is in default due to a Financial Inability to Pay of an amount
equal to or greater than $3,000,000 with respect to its payment of any prior Purchased
Receivables; and

          (k) the final termination of any blocked account agreement relating to a Blocked
Account without the Bank’s prior written consent.

     Section 18.2. Upon the occurrence of any Termination Event, the Bank may immediately terminate
its agreement to purchase additional Receivables and the authority of the Company to purchase
Replacement Receivables. Notwithstanding any other provision hereof, this Agreement shall continue
in full force and effect with respect to Purchased Receivables already purchased and all other
rights, benefits and entitlements of the Bank expressed or implied to continue after such
termination until the Final Collection Date.

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     Section 18.3. Upon the termination of this Agreement, the Bank will have, in addition to its
rights and remedies hereunder and under the other Transaction Documents, all other rights and
remedies under applicable laws and otherwise, which rights and remedies will be cumulative.

     Section 18.4. Without limiting the rights of the Bank, on the Termination Date, and on each
day thereafter, the Company, subject to the terms and conditions of this Agreement, will hold or
deposit in trust in the Blocked Accounts, for the benefit of the Bank, the Collections of Purchased
Receivables received by the Company on each such day and the Bank may withdraw all such amounts
from the Blocked Account upon giving the notice required under the relevant Blocked Account
Agreement. After the Bank has delivered any notice of termination under Section 18.1, Company
shall not exercise any right of set-off or compensation with respect to any sum owing to the Bank.

     Section 18.5. On the Termination Date, and at all times thereafter, all Purchased Receivables
described in Section 4.5(b), inclusive of those Purchased Receivables which are identified as
Purchased Receivables in the Portfolio Report to be delivered by the Company to the Bank as of the
Company’s close of business on the day immediately preceding the Termination Date shall, subject to
verification and approval by the Bank and this Section 18.5, be the Total Purchased Receivables
(the “Total Purchased Receivables”) for all purposes of this Agreement.

          If, on and at any time after the Termination Date and after the identification of the Total
Purchased Receivables, the Bank or the Company determines that, as of the Termination Date, the
Outstanding Net Amount of the Total Purchased Receivables is or was less than the Funded Amount at
such time, the Company shall immediately pay to the Bank by a deposit to Bank’s account the amount
by which the Funded Amount exceeds the Outstanding Net Amount of the Total Purchased Receivables as
at the Termination Date.

          If the Company fails to pay such amount, the list of the Total Purchased Receivables shall be
amended to include such amount of additional Receivables from the Approved Debtors as is necessary
to make the Outstanding Net Amount of the Total Purchased Receivables equal to the Funded Amount as
at the Termination Date.

     Section 18.6. Notwithstanding anything contained in this Agreement to the contrary, upon the
occurrence of a Termination Event under 18.1(i) or (j) with respect to a particular Approved
Debtor, the Bank’s agreement hereunder to purchase additional Receivables and the authority of the
Company to purchase Replacement Receivables hereunder shall not terminate pursuant to the terms of
Section 18.2 with respect to the other Approved Debtors.

Section 19. Miscellaneous

     Section 19.1. Assignments and Transfers. (a) The Bank may at any time assign, transfer or
participate (including by way of novation) any of its rights and obligations under the Transaction
Documents to another bank or financial institution; provided that the Bank shall notify the Company
in writing at least fifteen days prior to such assignment, transfer or

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participation and obtain the Company’s written consent thereto (so long as no Termination Event has
occurred and is continuing and has not otherwise been waived or cured), which consent shall not be
unreasonably withheld or delayed, and, if the Company so elects, the Company shall have fifteen
days from the date of such notice to repurchase any outstanding Purchased Receivables from the Bank
at the Purchase Price as set forth in Section 21.1 with respect to any amounts outstanding from
each Debtor in relation to each Purchased Receivable, plus any other amounts outstanding from the
Company to the Bank under this Agreement, including breakage costs under Section 7.4. Any
sub-participation by the Bank, each Approved Participant or any other participant shall be subject
to the notice and consent requirements set forth in the prior sentence, and the other provisions of
this Section 19.1, including the last sentence hereof. The Company agrees that each participant
shall be entitled to the benefit of Sections 7.2, 7.4 and 8 to the same extent as if it were the
Bank hereunder; provided, however, that a participant shall not be entitled to receive any greater
payment under such Sections than the Bank would have been entitled to receive with respect to the
participation sold to such participant, unless the sale of the participation to such participant is
made with the Company’s prior written consent. Notwithstanding anything contained herein to the
contrary, the Company hereby consents to the Bank’s participation of its rights and obligations
under the Transaction Documents to the Approved Participants pursuant to the terms of the
Participation Agreement dated as of the date hereof (the “Participation Agreement”) between the
Bank and the Approved Participants. The Bank agrees that it shall not (i) assign, transfer or
participate any of its rights or obligations hereunder after the date hereof in any manner that
allows any such assignee, transferee or participant to directly enforce any rights or remedies of
the Bank hereunder against the Company or the Parent, or (ii) permit or agree to any amendments or
modifications to the Participation Agreement which change any of the voting rights and percentages
in Section 11 thereof.

          (b) The Company may not assign or otherwise transfer its rights, benefits or obligations or
any of them under the Transaction Documents.

          (c) Subject to the foregoing, this Agreement shall be binding on and shall inure to the
benefit of each party hereto and its successors and assigns.

     Section 19.2. Waivers, Remedies Cumulative. No failure to exercise, nor any delay in
exercising, on the part of the Bank, any right or remedy under the Transaction Documents shall
operate as a waiver thereof, nor shall any single or partial exercise of any right or remedy
prevent any further or other exercise thereof or the exercise of any other right or remedy. The
rights and remedies herein provided are cumulative and not exclusive of any rights or remedies
provided by law.

     Section 19.3. Accounting Treatment. The Company agrees and acknowledges that it is a
sophisticated party in relation to this Agreement and that it has taken independent legal and
accounting advice in relation to the accounting treatment to be applied to this Agreement. It is
agreed that the Company has not relied on any representation of the Bank in this regard.

     Section 19.4. Third Party Rights. Other than as approved in this Agreement, no person not a
party to this Agreement shall be deemed a third party beneficiary hereof.

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     Section 19.5. Counterparts. Each Transaction Document may be executed in any number of
counterparts, and by the different parties thereto on separate counterparts; each such counterpart
shall be deemed an original and all of such counterparts taken together shall be deemed to
constitute one and the same instrument. A facsimile or electronic copy of an executed counterpart
of this Agreement shall be effective as an original for all purposes.

     Section 19.6. Entire Agreement. This Agreement constitutes the entire Agreement between the
parties hereto in relation to the Agreement and supersedes all previous proposals, agreements and
other written and oral communications in relation thereto.

     Section 19.7. Exclusion of Liability. In no event shall the Bank be liable for any loss of
profits, business, data or information or for any remote, incidental, indirect, special or
consequential damages.

     Section 19.8. Continuing Obligations. The Company shall remain liable to perform all
obligations assumed by it under each Contract, and the Bank shall be under no obligation of any
kind whatsoever thereunder or be under any liability whatsoever in the event of any failure by the
Company to perform its obligations thereunder.

     Section 19.9. USA Patriot Act. The Bank hereby notifies the Company that pursuant to the
requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26,
2001)) (the “Act”), it is required to obtain, verify, and record information that identifies the
Company, which information includes the name and address of the Company and other information that
will allow the Bank to identify the Company in accordance with the Act.

Section 20. Governing Law

     Section 20.1. This Agreement shall be governed by and construed in accordance with the laws of
the State of New York without regard to the principles of conflicts of law thereof (other than
Section 5-1401 of the New York General Obligations Law).

     Section 20.2. Any litigation based hereon, or arising out of, under or in
connection with this Agreement, may be brought and maintained in the courts of the State of
New York sitting in New York County, New York or in the United States district court for the
Southern District of New York; provided that any suit seeking enforcement against any receivables
or other property may be brought, at the Bank’s option, in the courts of any jurisdiction where
such receivables or other property may be found. The Company and the Parent hereby expressly and
irrevocably submit to the jurisdiction of the courts of the State of New York sitting in New York
County, New York and of the United States district court for the Southern District of New York for
the purpose of any such litigation. The Company and the Parent further irrevocably consent to the
service of process by registered mail, postage prepaid, to the address specified in Section 14.1 of
this Agreement (or such other address as they shall have specified in writing to the Bank as their
address for notices hereunder) or by personal service within or without the State of New York. The
Company, the Parent and the Bank expressly and irrevocably waive, 

-35-

 

to the fullest extent permitted by law, any objection which they may now or hereafter have to
the laying of venue of any such litigation brought in any such court and any claim that any such
litigation has been brought in an inconvenient forum.

     Section 20.3. The Company, the Parent and the Bank hereby waive any right to a
trial by jury in any action or proceeding to enforce or defend any rights under this Agreement or
any application, instrument, document, amendment or agreement delivered or which may in the future
be delivered in connection herewith or arising from any banking relationship existing in connection
with this Agreement, and agree that any such action or proceeding shall be tried before a court and
not before a jury.

Section 21. Optional Repurchase

     Section 21.1. In the event that (i) the Bank gives notice to the Company of its intention to
replace the Company as servicer and agent, (ii) the Bank informs the Company that it will not
purchase any other Receivables due to a Termination Event, (iii) a Purchased Receivable is past
due, or (iv) any bankruptcy or insolvency (however evidenced) of the Company or the Parent shall
occur, the Company may, at its option, repurchase all of the outstanding Purchased Receivables from
the Bank for an amount equal to the Purchase Price of such Purchased Receivables (or so much of it
as was paid by the Bank to the Company and remains unpaid), less the amount of the unearned portion
of the related Discount, if any, if such Purchased Receivable is being repurchased by the Company
prior to the due date of such Purchased Receivable as computed pursuant to Section 4.1 hereof and
if such Purchased Receivable is being repurchased by the Company after the due date of such
Purchased Receivable, together with interest thereon at the interest rate specified in Section 7.6
from the due date to the date of the Company’s payment in full thereof, and any other amounts then
payable by the Company hereunder, including, breakage costs under Section 7.4, whereupon such
amount shall become due and payable from the Company to the Bank on the date specified in such
notice and shall be paid into such account specified by the Bank.

     Section 21.2. In addition to the foregoing, the Company shall have the right at any time
before or after a Termination Event, at its option, to repurchase all or a portion of the
outstanding Purchased Receivables from the Bank for an amount equal to the Purchase Price of such
Purchased Receivables (or so much of it as was paid by the Bank to the Company and remains unpaid),
less the amount of the unearned portion of the related Discount, if any, if such Purchased
Receivable is being repurchased by the Company prior to the due date of such Purchased Receivable
as computed pursuant to Section 4.1 hereof and if such Purchased Receivable is being repurchased by
the Company after the due date of such Purchased Receivable, together with interest thereon at the
interest rate specified in Section 7.6 from the due date to the date of the Company’s payment in
full thereof, and any other amounts then payable by the Company hereunder, including, breakage
costs under Section 7.4, whereupon such amount shall become due and payable from the Company to the
Bank on the date specified in such notice and shall be paid into such account specified by the
Bank.

-36-

 

Section 22. Guaranty; Parent Covenant.

          (a) Parent is the owner of the Company. Parent hereby unconditionally and irrevocably
guarantees to the Bank the due and punctual payment, performance and observance by the Company of
all of the terms, covenants, conditions, agreements, representations, warranties, indemnities and
undertakings on the part of the Company to be performed or observed under this Agreement,
including, without limitation, the punctual payment when due of all obligations of the Company now
or hereafter existing under this Agreement, whether for indemnification payments, fees, expenses,
repurchase obligations or otherwise (all of the foregoing being collectively referred to as the
“Obligations”). In the event that the Company shall fail in any manner whatsoever to perform or
observe any of the Obligations when the same shall be required to be performed or observed under
this Agreement (subject to any applicable cure periods), then upon the written demand of the Bank,
Parent shall perform, cause to be performed or make payment to allow such Obligations to be
performed.

          Parent further agrees that nothing contained herein shall prevent the Bank from foreclosing on
its security interest in or lien on any asset, if any, or from exercising any other rights
available to it under this Agreement or any other instrument of security, if any, and the exercise
of any of the aforesaid rights and the completion of any foreclosure proceedings shall not
constitute a discharge of any of Parent’s obligations hereunder; it being the purpose and intent of
Parent that its obligations hereunder shall be absolute, independent and unconditional under any
and all circumstances. Neither Parent’s obligations hereunder nor any remedy for the enforcement
thereof shall be impaired, modified, changed, released or limited in any manner whatsoever by an
impairment, modification, change, release or limitation of the liability of the Company or by
reason of the bankruptcy or insolvency of the Company. Parent waives any and all notices of the
creation, renewal, extension or accrual of or increase in any of the Obligations and notice of or
proof of reliance by Bank upon this Section 22(a) or acceptance of this Section 22(a). This
Agreement shall conclusively be deemed to have been created, contracted or incurred, or renewed,
extended, amended or waived, in reliance upon this Section 22(a). All dealings between the Company
and Parent, on the one hand, and the Bank, on the other hand, likewise shall be conclusively
presumed to have been had or consummated in reliance upon this Section 22(a).

          Parent hereby waives any and all presentments, demands, notices, and protests against Parent,
and any requirement that the Bank commence or exhaust any remedies against the Company or any
collateral securing the Obligations. Parent’s liability hereunder shall be unconditional
irrespective of (i) any lack of enforceability of the Obligations, (ii) any law, regulation rights
with respect thereto, and (iii) any other circumstance which might otherwise constitute a defense
available to, or discharge of, the Company or Parent. This guarantee is a guarantee of payment and
performance and not of collection and shall remain in full force and effect until payment in full
of the Obligations. The Obligations of Parent under this Section 22(a) does rank and will rank
pari passu in priority of payment with all other unsecured and unsubordinated obligations for
borrowed money of Parent.

          All payments under this Section 22(a) by Parent shall be made by Parent on the date when due
and shall be made in lawful currency of the United States of America and in

-37-

 

immediately available
and freely transferable funds at the payment office of the Bank in the United States of America as
from time to time specified in writing by the Bank.

          (b) From and after the date hereof and so long as this Agreement is in effect, except to the
extent compliance in any case or cases is waived in writing by the Bank, the Parent agrees that it
will, for the benefit of the Bank, comply with, abide by, and be restricted by all the agreements,
covenants, obligations and undertakings of the Parent contained in the provisions of Section 6.10
of the Credit Agreement, inclusive, regardless of whether any indebtedness is now or hereafter
remains outstanding thereunder, or the Credit Agreement shall have terminated, all of which
provisions, together with the related definitions, exhibits and ancillary provisions, are
incorporated herein by reference, mutatis mutandis, and made a part hereof to the same extent and
with the same force and effect as if the same had been herein set forth in their entirety, and will
be deemed to continue in effect for the benefit of the Bank irrespective of whether the Credit
Agreement remains in effect, and without regard or giving effect to any amendment or modification
of such provisions or any waiver of compliance therewith, no such amendment, modification or waiver
to in any manner constitute an amendment, modification or waiver of the provisions thereof as
incorporated herein unless consented to in writing by the Bank; provided, that said provisions for
purposes of the incorporation described herein shall be amended in the following respects:

     (i) the term “Borrower” appearing in said provisions shall mean and refer to the
Parent;

     (ii) the term “Lenders” or “Administrative Agent” appearing in said provisions shall
mean and refer to Bank as defined in this Agreement;

     (iii) the term “Agreement” appearing in said provisions shall mean and refer to this
Agreement; and

     (iv) the term “herein” or “hereof” appearing in said provisions shall mean and refer to
this Agreement.

Other than as hereinabove amended, any terms contained in the provisions of the Credit Agreement
incorporated herein which are defined in the Credit Agreement shall have the same meaning herein as
in the Credit Agreement.

Section 23. Removal; Reinstatement of Debtor.

          From time to time, the Company may request that one or more Approved Debtors be removed as
“Approved Debtors” from the Approved Debtor Certificate hereunder by delivery to the Bank of
written notice of such request, which notice shall set forth the date on which such Approved
Debtors shall be removed therefrom (a “Removal Date”), which date shall be no earlier than ten days
after the date such notice was delivered. At any time after the applicable
Removal Date for a Debtor that was once an Approved Debtor and prior to the Termination Date,
so long as no Termination Event has occurred, the Company may reinstate such Debtor as an “Approved
Debtor” in the Approved Debtor Certificate by delivery to the Bank of written

-38-

 

notice of such
request, which notice shall set forth the date on which such Debtor shall become an “Approved
Debtor”, which date shall be no earlier than ten days after the date such notice was delivered.
Upon any such removal or reinstatement of an Approved Debtor, a corresponding reduction or
reinstatement, as applicable, shall be made to the related Debtor Sublimit; provided, however, that
with respect to any reinstatement of the related Debtor Sublimit, such Debtor Sublimit shall not be
reinstated in an amount greater than the Debtor Sublimit in effect on the applicable Removal Date.

Section 24. Confidentiality.

          Each party hereto agrees to hold the Transaction Documents and all non-public information
received by it in connection therewith from any other party hereto or its agents or representatives
in confidence and agrees not to provide any Person with copies of any Transaction Document or such
non-public information other than to (i) any officers, directors, members, managers, employees or
outside accountants, auditors or attorneys thereof, (ii) any prospective or actual assignee or
participant which (in each case) has signed a confidentiality agreement containing provisions
substantively identical to this Section 24 or has agreed to be subject to the terms of this
Section 24, and (iii) Governmental Authorities with appropriate jurisdiction (including filings
required under securities laws). Notwithstanding the above stated obligations, provided that the
other parties hereto are given notice of the intended disclosure or use, the parties hereto will
not be liable for disclosure or use of such information which such Person can establish by tangible
evidence: (i) was required by law, including pursuant to a valid subpoena or other legal process,
(ii) was in such Person’s possession or known to such Person prior to receipt or (iii) is or
becomes known to the public through disclosure in a printed publication (without breach of any of
such Person’s obligations hereunder).

[Remainder of Page Intentionally Left Blank]

-39-

 

     In Witness Whereof, the parties have executed this Agreement by their undersigned,
duly authorized officers on the date first above written:

	 	 	 	 	 
	 	Bank of America, N.A.

 	 
	 	By:  	/s/ Mike B. Delaney
 	 
	 	 	Title: Vice President  	 
	 	 	 	 
	 
	 	The Scotts Company LLC

 	 
	 	By:  	/s/ David C. Evans
 	 
	 	 	Title:  C.F.O.  	 
	 	 	 	 
	 
	 	The Scotts Miracle-Gro Company

 	 
	 	By:  	/s/ David C. Evans
 	 
	 	 	Title:  C.F.O.  	 
	 	 	 	 
	 

-40-

 

Schedule 1

Purchase Request

                    , 20__

Bank of American, N.A.

231 South LaSalle Street, 10th Floor

Chicago, Illinois 60604

Attn:  Michael Delaney

     Re:       Request for Purchase

Ladies and Gentlemen:

     We refer to the Master Accounts Receivable Purchase Agreement among Bank of America, N.A., The
Scotts Company LLC and The Scotts Miracle-Gro Company, dated as of April 9, 2008 (the “Purchase
Agreement”). Terms defined in the Purchase Agreement shall have the same meaning herein as defined
in such Purchase Agreement.

     The undersigned Company hereby requests that the Bank purchase on                     , 20___, (the
“Purchase Date”), the Purchased Receivables set forth on Schedule I attached hereto, in accordance
with, and subject to, the terms and provisions of the Purchase Agreement. The undersigned Company
hereby makes the representations and warranties set forth in Section 10 of the Purchase Agreement
for the benefit of the Bank, as of the Purchase Date, and further state that such representations
and warranties are true and correct as of such Purchase Date.

     Executed and delivered by the undersigned Company as of the date first above written.

	 	 	 	 	 
	 	

The Scotts Company LLC 

 	 
	 	By:  	 	 
	 	 	Title: 
	 
	 	 	 	 
	 

 

 

Schedule 2

Conditions Precedent

     The Bank shall have received each of the following, in form and substance satisfactory to it:

     (a) Executed counterparts of this Agreement and the other Transaction Documents.

     (b) Certified copies of resolutions of the Company’s and Parent’s board of directors or
members authorizing this Agreement and the Bank having received executed copies of this
Agreement and the other Transaction Documents and authorizing a person or persons to sign or
otherwise attest the due execution of those documents including any subsequent notices and
acknowledgements to be executed or delivered pursuant to this Agreement, the other
Transaction Documents and any other documents to be executed or delivered by the Company
pursuant hereto or thereto together with an officer incumbency and specimen signature
certificate, all in form satisfactory to the Bank.

     (c) Legal opinions of outside special counsel to the Company relating to the
enforceability of the Transaction Documents, and the perfection of the ownership and
security interests created hereby, and of outside special counsel or internal counsel to the
Company relating to the power and authority of Company to enter into the Transaction
Documents and its performance thereunder, in each case in form and in substance satisfactory
to it.

     (d) Blocked Account Agreements signed by the Company in form satisfactory to the Bank.

     (e) Acknowledgement copies of such UCC financing statements or other filings as are
required under Section 9.1, such lien search reports as the Bank shall deem advisable with
respect to the Company, and releases of any Adverse Claim on the Purchased Receivables shown
in such reports.

     (f) An acknowledgment from JPMorgan Chase Bank, N.A., as agent under the existing
working capital credit facility agreement (the “Credit Agreement”), that all Purchased
Receivables shall be deemed to be “Sold Receivables” under the Credit Agreement and that
this Agreement constitutes a “Receivables Purchase Agreement” under the Credit Agreement.

 

 

Schedule 3

UCC Details Schedule

UCC Information

	 	 	 	 	 
	(a) Name:

	 	 	The Scotts Company LLC

	 
	 	 	 	 
	(b) Chief Executive Office:

	 	 	14111 Scottslawn Road

	 

	 	 	Marysville, Ohio 43041

	 
	 	 	 	 
	(c) State of Organization:

	 	 	Ohio

	 
	 	 	 	 
	(d) Organizational ID No.:

	 	 	1503259	 
	 
	 	 	 	 
	(e) Tradenames:

	 	 	None

	 
	 	 	 	 
	(f) Changes in Location, Name and Corporate Organization:

	 	 	None

 

 

Schedule 4

Form of Portfolio Report

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