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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended: December 31, 2017
◻ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from                       to                       
Commission File Number: 001-36473

Trinseo S.A.
(Exact name of registrant as specified in its charter)

Luxembourg	 	N/A	
(State or other jurisdiction of
incorporation or organization)	 	(I.R.S. Employer   Identification Number)	

1000 Chesterbrook Boulevard, Suite 300
Berwyn, PA 19312
(Address of Principal Executive Offices)
(610) 240-3200
(Registrant’s telephone number)

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class	 	Name of Each Exchange on Which Registered	
Ordinary Shares, par value $0.01 per share	 	New York Stock Exchange	
Securities registered pursuant to Section 12(g) of the Act:
None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    Yes  ☒    No  ◻ 
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.    Yes  ◻    No  ☒ 
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ◻ 
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  ☒    No  ◻ 
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  ☒ 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
 	 	 	 	 	 	
Large accelerated filer	☒	Accelerated filer	◻		 	
 	 	 	 	 	 	
Non-accelerated filer	◻  (Do not check if a smaller reporting company)	Smaller reporting company	◻	Emerging growth company	◻	
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ◻
Indicate by check mark whether the Company is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ◻    No  ☒ 
As of February 26, 2018, there were 43,280,500 shares of the registrant’s ordinary shares outstanding.
The aggregate market value of the voting and non-voting shares of the registrant held by non-affiliates of Trinseo S.A. computed by reference to the closing price of the registrant’s common stock on the New York Stock Exchange as of June 30, 2017 was approximately $3,000,992,078.

Documents Incorporated by Reference
Portions of the registrant’s definitive Proxy Statement for the 2018 Annual General Meeting of Shareholders to be filed with the Securities and Exchange Commission pursuant to Regulation 14A not later than 120 days after the end of the fiscal year covered by this Form 10-K are incorporated by reference in Part III, Items 10-14 of this Form 10-K.

 

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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This annual report on Form 10-K (“Annual Report”) contains forward-looking statements including, without limitation, statements concerning plans, objectives, goals, projections, strategies, future events or performance, and underlying assumptions and other statements, which are not statements of historical facts. Forward looking statements may be identified by the use of words like “expect,” “anticipate,” “intend,” “forecast,” “outlook,” “will,” “may,” “might,” “potential,” “likely,” “target,” “plan,” “contemplate,” “seek,” “attempt,” “should,” “could,” “would” or expressions of similar meaning. Forward-looking statements reflect management’s evaluation of information currently available and are based on our current expectations and assumptions regarding our business, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict. Specific factors that may impact performance or other predictions of future actions have, in many but not all cases, been identified in connection with specific forward-looking statements. Our actual results may differ materially from those contemplated by the forward-looking statements. They are neither statements of historical fact nor guarantees or assurances of future performance. Important factors that could cause actual results to differ materially from those in the forward-looking statements include economic, business, competitive, market and regulatory conditions and the following:
	·		volatility in costs or disruption in the supply of the raw materials or energy utilized for our products;	
	·		conditions in the global economy and capital markets;	
	·		strategic acquisitions or divestitures affecting current operations;	
	·		the execution of capital projects in accordance with the Company’s plan, budget and forecasts;	
	·		any disruptions in production at our manufacturing facilities;	
	·		changes in laws and regulations applicable to our business;	
	·		our continued reliance on our relationship with The Dow Chemical Company;	
	·		the stability of our joint ventures;	
	·		our current and future levels of indebtedness;	
	·		the restrictions on our operations due to our indebtedness;	
	·		liabilities and lawsuits resulting from our products or operations;	
	·		regulatory and statutory changes applicable to our raw materials and products;	
	·		expenditures related to changes to and our compliance with environmental, health and safety laws;	
	·		fluctuations in currency exchange rates;	
	·		any inability to continue technological innovation and successful introduction of new products;	
	·		local business risks in the different countries in which we operate;	
	·		any inability to protect our trademarks, patents or other intellectual property rights;	
	·		our infringement on the intellectual property rights of others;	
	·		data security breaches;	
	·		risks associated with our incorporation in Luxembourg;   and	
	·		other risks described in the “Risk Factors” section of this Annual Report.	
We derive many of our forward-looking statements from our operating budgets and forecasts, which are based upon many detailed assumptions. While we believe that our assumptions are reasonable, we caution that it is very difficult to predict the impact of known factors, and, it is impossible for us to anticipate all factors that could affect our actual results. Important factors that could cause actual results to differ materially from our expectations, or cautionary statements, are disclosed under the sections entitled “Risk Factors”, “Management’s Discussion and Analysis of Financial Condition and Results of Operations”, and “Quantitative and Qualitative Disclosures About Market Risk” in this Annual Report. All written and oral forward-looking statements attributable to us, or persons acting on our behalf, are expressly qualified in their entirety by the cautionary statements as well as other cautionary statements that are made from time to time in our other public communications. You should evaluate all forward-looking statements made in this Annual Report in the context of these risks and uncertainties.

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We caution you that the important factors referenced above may not contain all of the factors that are important to you. In addition, we cannot assure you that we will realize the results or developments we expect or anticipate or, even if substantially realized, that they will result in the consequences or affect us or our operations in the way we expect. The forward-looking statements included in this Annual Report are made only as of the date hereof. We undertake no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or otherwise, except as otherwise required by law.

 

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TABLE OF  CONTENTS
 
 	 	Page  	
Part I  	    	    	
Item 1.  	Business	
5	
Item 1A.  	Risk Factors	
20	
Item 1B.  	Unresolved Staff Comments	
30	
Item 2.  	Properties	
30	
Item 3.  	Legal Proceedings	
32	
Item 4.  	Mine Safety Disclosures	
32	
 	 	 	
Part II  	 	 	
Item 5.  	Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities	
32	
Item 6.  	Selected Financial Data	
36	
Item 7.  	Management’s Discussion and Analysis of Financial Condition and Results of Operations	
39	
Item 7A.  	Quantitative and Qualitative Disclosures About Market Risk	
60	
Item 8.  	Financial Statements and Supplementary Data	
62	
Item 9.  	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	
62	
Item 9A.  	Controls and Procedures	
62	
Item 9B.  	Other Information	
63	
 	 	 	
Part III  	 	 	
Item 10.  	Directors, Executive Officers and Corporate Governance	
63	
Item 11.  	Executive Compensation	
64	
Item 12.  	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	
64	
Item 13.  	Certain Relationships and Related Transactions, and Director Independence	
64	
Item 14.  	Principal Accounting Fees and Services	
64	
 	 	 	
Part IV  	 	 	
Item 15.  	Exhibits, Financial Statement Schedules	
65	
Item 16.  	Form 10-K Summary	
69	
Signatures  	
70	
Index to Consolidated Financial Statements  	F-1	

 

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Trinseo S.A.
Form 10-K Annual Report
For the Fiscal Year Ended December 31, 2017
Unless otherwise indicated or required by context, as used in this Annual Report, the term “Trinseo” refers to Trinseo S.A. (NYSE: TSE), a public limited liability company (société anonyme) existing under the laws of Luxembourg, and not its subsidiaries. The terms “Company,” “we,” “us” and “our” refer to Trinseo and its consolidated subsidiaries, taken as a consolidated entity and as required by context, may also include our business as owned by our predecessor, The Dow Chemical Company, for any dates prior to June 17, 2010. The terms “Trinseo Materials Operating S.C.A.” and “Trinseo Materials Finance, Inc.” refer to Trinseo’s indirect subsidiaries, Trinseo Materials Operating S.C.A., a Luxembourg partnership limited by shares incorporated under the laws of Luxembourg, and Trinseo Materials Finance, Inc., a Delaware corporation, and not their subsidiaries. All financial data provided in this Annual Report is the financial data of the Company, unless otherwise indicated.
Prior to our formation, our business was wholly owned by The Dow Chemical Company, which we refer to as, together with its affiliates, “Dow”. We refer to our predecessor business as “the Styron business.” On June 17, 2010, investment funds advised or managed by affiliates of Bain Capital Partners, LP (“Bain Capital”) acquired Dow Europe Holding B.V. and the Styron business. We refer to our acquisition by Bain Capital as the “Acquisition”. During 2016, Bain Capital Everest Manager Holding SCA (the “former Parent”), an affiliate of Bain Capital, divested its entire ownership in the Company in a series of secondary offerings to the market.
The Company may distribute cash to shareholders under Luxembourg law via repayments of equity or an allocation of statutory profits. Since the Company began paying dividends, all distributions have been considered repayments of equity under Luxembourg law.
Definitions of capitalized terms not defined herein appear in the notes to our consolidated financial statements. Specifically, refer to Note 10 in the consolidated financial statements for definitions of the Company’s debt facilities.

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PART  I
Item 1.    Business 
BUSINESS
The Company
Trinseo S.A. (NYSE: TSE) is a public limited liability company (société anonyme) formed in 2010 and existing under the laws of Luxembourg. Prior to our formation, our business was wholly owned by Dow. On June 17, 2010, investment funds advised or managed by affiliates of Bain Capital acquired our business and Dow Europe Holding B.V. During 2016, Bain Capital divested its entire ownership in the Company in a series of secondary offerings to the market.
We are a leading global materials company engaged in the manufacture and marketing of synthetic rubber, latex binders, and plastics, including various specialty and technologically differentiated products. We have leading market positions in many of the markets in which we compete. Our products are incorporated into a wide range of our customers’ products throughout the world, including tires and other products for automotive applications, carpet and artificial turf backing, coated paper, specialty paper and packaging board, food packaging, appliances, medical devices, consumer electronics and construction applications, among others. We have long-standing relationships with a diverse base of global customers, many of whom are leaders in their markets and rely on us for formulation, technological differentiation, and compounding expertise to find sustainable solutions for their businesses. Many of our products represent only a small portion of a finished product’s production costs, but provide critical functionality to the finished product and are often specifically developed to customer specifications. Therefore, we seek to regularly develop new and improved products and processes, supported by our intellectual property portfolio, designed to enhance our customers’ product offerings. We believe these product traits result in substantial customer loyalty for our products.
We have significant manufacturing and production operations around the world, which allow us to serve our global customer base. As of December 31, 2017, our production facilities included 30 manufacturing plants (which included a total of 75 production units) at 23 sites across 12 countries, including joint ventures and contract manufacturers. Additionally, as of December 31, 2017, we operated 11 research and development (“R&D”) facilities globally, including mini plants, development centers and pilot coaters, which we believe are critical to our global presence and innovation capabilities. Our significant global operations provide geographic revenue diversity, and diversity in end markets for our products. 

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Our Strategy
We believe that there are significant opportunities to improve our business globally and enhance our position as a leading global materials company engaged in the manufacture and marketing of standard, specialty and technologically differentiated emulsion polymers and plastics. The Company’s business strategy is to grow both organically and through the pursuit of strategic acquisitions and joint ventures that have attractive risk-adjusted returns that extend our leadership positions in attractive markets and geographies, while, when appropriate making strategic divestures or closures in non-performing businesses and geographies. The Company’s organic growth will be developed through strategic capital investments to extend our leadership position in select market segments and by innovation that provides technological differentiation to our customers who seek our technological and development capabilities to create specialty grades, new and sustainable products, and technologically differentiated formulations.
In order to support the Company’s strategic growth, we remain committed to maintaining a strong financial position with appropriate financial flexibility and liquidity. The Company employs a disciplined approach to capital allocation and deployment of cash that strives to balance the growth of our business and continued cash generation while providing attractive returns to our shareholders. The priorities for uses of available cash include the servicing of our debt, the funding of targeted growth initiatives, the continued payment of quarterly dividends to our shareholders, and the repurchase of our ordinary shares. Management expects that the combination of strong cash flow generation, continued profitability, and spending discipline will continue to provide the Company with flexibility to pursue its business strategy.
For 2017, the Company progressed on our strategic initiatives by:
	·		Commencing production of MAGNUM™ acrylonitrile-butadiene-styrene resins in our Zhangjiagang, China plant.	
	·		Acquiring API Applicazioni Plastiche Industriali S.P.A., or API Plastics, a manufacturer of soft-touch polymers and bioplastics, based in Mussolente, Italy. 	
	·		Increasing our global enhanced rubber production capabilities by adding 50 KT of new solution styrene-butadiene rubber, or SSBR, capacity.	
	·		Opening a new Plastics Research Center, which modernized two existing technical support centers and research lab operations in a single location at our Terneuzen, The Netherlands office location.	
	·		Divesting our 50% share in Sumika Styron Polycarbonate to Sumitomo Chemical Company Limited.	
	·		Completing a successful debt refinancing during the third quarter, which is expected to reduce annual cash interest by approximately $25.0 million.	
	·		Increasing our quarterly dividend to shareholders by 20% in June 2017, from $0.30 to $0.36 per share.	
	·		Using cash of approximately $89.0 million to repurchase from our shareholders nearly 1.4 million ordinary shares in a series of open market transactions.	
For more information regarding our strategic highlights see Item 7 – Management’s Discussion and Analysis of Financial Condition and Results of Operations – 2017 Highlights .
Business Segments and Products
For the financial periods provided in this Annual Report, we operated our business in two divisions: Performance Materials and Basic Plastics & Feedstocks. Our two divisions are of similar size in terms of sales, but have different margin profiles, different strategic focus, different value drivers and different operating requirements, with the Performance Materials segments focusing on accelerating growth and the Basic Plastics & Feedstocks segments focusing on increasing profitability. 
Effective October 1, 2016, the Performance Materials division includes the following reporting segments: Latex Binders, Synthetic Rubber, and Performance Plastics. The Basic Plastics & Feedstocks division includes the following reporting segments: Basic Plastics, Feedstocks, and Americas Styrenics. Prior period financial information for fiscal year

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2015 and prior included within this Annual Report was recast from its previous presentation to align with this organizational structure.
The following chart provides an overview of this organizational structure:

The major products in our Performance Materials division include: styrene-butadiene latex, or SB latex, and styrene-acrylate latex, or SA latex, in our Latex Binders segment; SSBR, emulsion styrene-butadiene rubber, or ESBR, nickel polybutadiene rubber, or Ni-PBR, and neodymium polybutadiene rubber, or Nd-PBR, in our Synthetic Rubber segment; and highly engineered compounds and blends products for automotive end markets, as well as consumer electronics, medical, electrical and lighting, which we collectively call consumer essential markets, or CEM, in our Performance Plastics segment. The major products in our Basic Plastics & Feedstocks division include: polystyrene, polycarbonate, or PC, acrylonitrile-butadiene-styrene, or ABS, and styrene-acrylonitrile, or SAN, in our Basic Plastics reporting segment; styrene monomer in our Feedstocks segment; and styrene and polystyrene in our Americas Styrenics reporting segment.
Refer to Note 18 in the consolidated financial statements for information regarding sales and Adjusted EBITDA by segment, which is the performance metric used by management to evaluate our segments’ performance, as well as sales and long-lived assets by geographic area.
Latex Binders Segment
Overview
We are a global leader in SB latex, holding a strong market position across the geographies and applications in which we compete, including the #2 position in SB latex capacity in Europe and the #1 position in capacity in North America. In 2017, approximately 43% of our Latex Binders segment’s sales were generated in Europe, 27% were generated in the United States, and the majority of the remaining net sales were generated in Asia.
Products and End Uses
We hold the #1 position for supplying SB latex for the coated paper market globally. SB latex is widely used as a binder for mineral pigments as it allows high coating speeds, improved smoothness, higher gloss level, opacity and water resistance that is valued in the product’s end use in advertising, magazines, and packaging board coatings.
We are also a leading supplier of latex binders to the carpet and artificial turf industries and offer a diverse range of products for use in residential and commercial broadloom, needlefelt, and woven carpet backings. We produce high solids SB latex, SA latex, vinylidene chloride, and butadiene-methacrylate latex products for the commercial and niche carpet markets. We incorporate vinyl acrylic latex in our formulations for its ignition-resistant properties, with the sourcing of vinyl acrylic latex readily available from a number of industry suppliers. SB latex is also used in flooring as an adhesive for carpet and artificial turf fibers.
We also offer a broad range of performance latex products, including SB latex, SA latex, and vinylidene chloride latex primarily for the adhesive, building and construction as well as the technical textile paper market, and have begun to implement the use of starch and associated new chemistries in paper coatings and carpet backing.

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Competition and Customers
Our principal competitors in our Latex Binders segment include BASF Group, Omnova Solutions Inc., and Synthomer plc. In this segment, we compete primarily based on our ability to offer differentiated and reliable products, the quality of our customer service and the length and depth of our relationships. We also believe our growth prospects could be enhanced if the recent trend of industry capacity reduction and consolidation continues.
We believe our Latex Binders segment is able to differentiate itself by offering customers value-added formulation and product development expertise. Our R&D team and Technical Services and Development team, which we refer to as TS&D, are able to use our two pilot coating facilities in Switzerland and the United States, three paper fabrication and testing labs in China, Switzerland and the United States, three carpet technology centers located near carpet producers in China, the United States and Switzerland, and two product development and process research centers, one each in Germany and the United States, to assist customers in designing new products and enhancing the manufacturing process. Many of our major customers rely on our dedicated R&D and TS&D teams to complement their limited in-house resources for formulation and reformulation tests and trials. We believe that this capability allows us to capture new business, strengthen our existing customer relationships and broaden our technological expertise.
Additionally, our global manufacturing capabilities are key in serving customers cost-effectively, as latex binders are costly to ship over long distances due to their high water content. We believe that our global network of service and manufacturing facilities is highly valued by our customers. We seek to capture the value of our R&D and TS&D services and manufacturing capabilities through our pricing strategy. In 2017, we estimate that more than half of net sales in this segment related to contracts that include raw material pass-through clauses.
Synthetic Rubber Segment
Overview
We are a significant producer of styrene-butadiene and polybutadiene-based rubber products and we have a leading European market position, providing approximately 52% of Western Europe’s SSBR capacity available for sale. While substantially all of our sales were generated in Europe in 2017, approximately 23% of these net sales were exported to Asia, 9% to North America, and 6% to Latin America.
Products and End Uses
Our Synthetic Rubber segment produces synthetic rubber products used in high-performance tires, impact modifiers and technical rubber products, such as conveyor belts, hoses, seals and gaskets. We participate significantly in the European synthetic rubber industry, where tire producers focus on high-performance and ultra high-performance tires and rely heavily on rubber suppliers to provide their supply of rubber. This is in contrast to North America, where tire manufacturers produce most of their required rubber. We have a broad synthetic rubber technology and product portfolio, focusing on specialty products, such as SSBR and Nd-PBR, while also producing core products, such as ESBR. Our synthetic rubber products are extensively used in tires, with approximately 82% of our net sales from this segment in 2017 attributable to the tire market. We estimate that 75% of these sales relate to replacement tires. We have strong relationships with many of the top global tire manufacturers and believe we have remained a supplier of choice as a result of our broad rubber portfolio and ability to offer technologically differentiated product and product customization capabilities. Other applications for our synthetic rubber products include polymer modification and technical rubber goods.
SSBR .  We sell SSBR products for high-performance and ultra high-performance tire applications. We produce both clear and oil extended SSBR through batch polymerization in our three SSBR production lines. We believe these processes provide leading and technologically differentiated solutions to tire manufacturers.
During the last seven years, we have been working closely with major tire producers around the world to develop multiple new SSBR grades, addressing key marketplace needs for improved tire fuel economy, grip, and abrasion characteristics, which we believe will lead to significant demand growth for our rubber products in Europe and around the world. We expect our synthetic rubber product mix to continue to shift to more advanced SSBR grades (from approximately 8% of total Synthetic Rubber volume sold in 2011 to 30% in 2017) in order to meet expected demand growth. In 2017, SSBR represented approximately 57% of total segment net sales.

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Performance tires represent an especially attractive market to rubber producers because they provide substantial value to end customers. In fact, the market for performance tires is expected to grow at a rate that is 2 to 3 times that of the total tire market. Tire manufacturers are expected to continually seek improvements in advanced rubber, which optimizes the combination of fuel economy and wet grip in order to meet EU regulations which set minimum requirements and are being phased in through 2020. Other jurisdictions have adopted or are considering similar legislation and are also beginning to adopt the tire labeling requirements that have become mandatory in Europe. We believe our growth prospects are enhanced by increasing demand for high performance tires, which are now more commonly used by automakers as original equipment manufacturer specified tires in their vehicles as a result of regulatory reforms in the EU, Japan and Korea that are aimed at improving fuel efficiency and reducing carbon dioxide emissions.
ESBR .  Our ESBR products are used in standard tires, technical goods, and footwear. Our ESBR product portfolio offers tire producers a comprehensive suite of synthetic rubber capabilities. For example, ESBR provides enhanced wet grip to tire treads and strength to the inner liner of tires, allowing the tires to be more easily processed. In 2017, ESBR represented approximately 34% of total segment net sales.
Ni-PBR and Nd-PBR .  Throughout much of 2017, we sold Ni-PBR products for use in standard tires, performance tires, technical goods and footwear. In 2017, Ni-PBR represented approximately 8% of total segment net sales. In November 2015, we completed the conversion of our Ni-PBR production capacity at our Schkopau, Germany facility to a swing line, allowing for the production of Ni-PBR as well Nd-PBR, a more advanced, higher margin polybutadiene rubber that is a key material in the latest generation of performance tires, and is also sold for use in industrial rubber goods and polymer modification. In 2017, we began trials of Nd-PBR production, and expect to increase sales in this area in the future.
Competition and Customers
Our principal competitors in our Synthetic Rubber segment include Asahi Kasei Corporation, JSR Corporation, ARLANXEO, Zeon Corporation, Kumho Petrochemical Co., Ltd., PetroChina Company Limited, Reliance Rubber Industries, Sinopec Corp., Versalis S.p.A and Synthos S.A. In our Synthetic Rubber segment, we compete primarily based on our ability to offer differentiated and reliable products, the quality of our customer service and the length and depth of our relationships. We maintain deep and long-standing relationships with a large number of multinational customers, including many of the top global tire manufacturers, as well as fast growing Asian tire manufacturers. Our relationships with our top customers, including with our predecessor business operated by Dow prior to the Acquisition (as defined in Note 1 in the consolidated financial statements), range from 10 to more than 20 years. Our top three customers in this segment accounted for 56% of our net sales in this reporting segment. The loss of one or more of these customers could have a material adverse effect on the performance of the Synthetic Rubber segment.
We believe we have remained a supplier of choice given our broad rubber portfolio, including technologically differentiated grades, and our product customization capabilities. Our R&D and TS&D teams use our broad rubber portfolio to develop differentiated specialty products for customers. Once implemented with a customer, these newly-developed specialty products cannot be easily replaced with a competitor’s product. As a result, we believe customers are likely to buy from us throughout the life cycle of specific tire models to avoid high switching costs and prevent repetition of the expensive development process.
Enhanced SSBR, which includes later generations of SSBR and functionalized SSBR and is used in the new generation of performance tires, is expected to approach 50% of the total SSBR market by 2019. We believe the Company is well-positioned to capture additional market share in the high-growth, high-performance tire application markets. We expect that demand for enhanced SSBR will grow at a rate in excess of supply, resulting in an expected increase in industry utilization rates.  
In order to address this anticipated demand, the Company has added 125 kMT of SSBR capacity since 2012, including an additional 50kT in SSBR capacity that came online in January 2018 at our Schkopau, Germany facility. By the second half of 2018, we also expect to have operational a new SSBR rubber pilot plant that will expedite the product development process from lab sample to commercialization by delivering sufficient quantities of new formulations without the need to interrupt production in our industrial lines.
While we export our rubber products worldwide, our production facilities currently are solely in Europe.  Therefore, we may face competitive challenges with rubber customers who would prefer local rubber manufacturers.

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We seek to capture the value of our R&D and TS&D services through our pricing strategy. We estimate that approximately 84% of net sales in this segment relate to contracts that include raw material pass-through clauses.
Performance Plastics Segment
Overview
We are a producer of highly engineered compounds and blends for automotive end markets, as well as consumer electronics, medical, electrical, and lighting, or CEM. In 2017, approximately 44% of our Performance Plastics segment’s net sales were generated in Europe, approximately 27% were generated in the United States, and approximately 19% were generated in Asia, with the remainder in other geographic areas, including Mexico and Canada.
Products and End Uses
Our Performance Plastics segment consists of compounds and blends and some specialized ABS grades. We have a significant position in PC/ABS blends, which combine the heat resistance and impact strength of PC with the easy-to-process qualities and resilience of ABS. Our Performance Plastics segment also compounds and blends our PC and ABS plastics into differentiated products for customers within these sectors, as well as compounds of polypropylene. We have also developed compounds containing post-consumer recycled polymers to respond to what we believe is a growing need for some customers to include recycled content in their products. We believe our ability to offer technologically differentiated products to meet customer needs sets us apart from our competitors, and with our history as a leading innovator in compounds and blends, we have established ourselves as a leading supplier of PC-based products.
For the automotive industry, we manufacture PC/ABS blends under the PULSE™ brand, and we innovate collaboratively with our customers to develop performance solutions to meet the industry’s needs, such as reducing the weight of vehicles. As a result, we are a key supplier of these products to leading automotive companies in North America and Europe, who tend to specify these products on a per car program platform basis, making it difficult to be displaced as a supplier once selected and providing us with relatively stable and predictable cash flows for several years during the production lifecycle. We are also accelerating our development of similar supply capabilities in growing areas such as China. Through our acquisition of API Plastics, we have added thermoplastic elastomers (TPEs) and other soft polymers to our product offerings to the automotive industry.
For the consumer electronics, electrical and lighting and medical device industries, we manufacture our products under the EMERGE™ brand, among others, and we believe that we have substantial growth opportunities in tablets, notebooks, smart phones and other handheld devices, and electrical and lighting and medical device components. In serving these markets, we leverage our polymer and compound technologies to meet increasingly stringent performance requirements along with the aesthetic and color-matching requirements which are crucial characteristics for the products involved.
Competition and Customers
Our principal competitors in our Performance Plastics segment are Covestro AG, Saudi Basic Industries Corporation, Borealis AG, Celanese Corporation, Shanghai Kumho Sunny Plastics Co., Ltd., Shanghai Pret Composites Co. Ltd., INEOS Styrolution, Lotte Chemical Corporation, and LyondellBasell. In our Performance Plastics segment, we compete primarily based on our ability to offer differentiated and reliable products, the quality of our customer service and the length and depth of our customer relationships.
We believe growth in the Performance Plastic segment is due to a number of factors, including consumer preference for lighter weight and impact-resistant products and the development of new consumer electronics and continuing growth in medical device applications. Additionally, we believe growth is bolstered by sustainability trends, such as the substitution of lighter-weight plastics for metal in automobiles. Therefore, we believe our history of innovation and our focus on differentiated products enhances our growth prospects in this segment. Our innovation has contributed to long-standing relationships with customers who are recognized leaders in their respective end-markets. We also believe our global facilities are a competitive advantage that allows us to provide customers with consistent grades across markets and positions us to strategically serve emerging markets.

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Basic Plastics Segment
Overview
Basic Plastics consists of styrenic-based polymers, including polystyrene, ABS, and SAN products, as well as PC. We do not anticipate investing in strategic growth initiatives in this segment in the near term. In 2017, approximately 70% of sales from our Basic Plastics segment were generated in Europe and an additional 25% of sales were generated in Asia.
Products and End Uses
Polystyrene .  We are a leading producer of polystyrene and focus on sales to injection molding and thermoforming customers. Our product offerings include a variety of general purpose polystyrenes, or GPPS, and HIPS, which is polystyrene that has been modified with polybutadiene rubber to increase its impact resistant properties. These products provide customers with performance and aesthetics at a low cost across applications, including appliances, packaging, including food packaging and food service disposables, consumer electronics and building and construction materials.
We believe our STYRON™ brand is one of the longest established brands in the industry and is widely recognized in the global marketplace. We believe our R&D efforts have resulted in valuable, differentiated solutions for our customers. For instance, during 2015, we developed an innovative STYRON X-TECH™ resin that allows manufacturers to reduce the thickness, yet enhance the thermoformability, of their plastic refrigerator and freezer liners. In 2017, polystyrene represented approximately 60% of total segment net sales.
Acrylonitrile-Butadiene-Styrene (ABS) .  We are a leading producer of ABS in Europe and are one of the few producers with a presence in North America. We produce mass ABS, or mABS, a variation of ABS that has lower conversion and capital costs compared to the more common emulsion ABS, or eABS, process, marketed under our MAGNUM™ brand. mABS has similar properties to eABS but has greater colorability, thermal stability and lower gloss. mABS products can be manufactured to stricter specifications because they are produced in a continuous process as opposed to the batch process used in eABS. mABS also has environmental benefits such as waste reduction and higher yields. In addition to our own mABS production capacity, we have licensed our proprietary mABS technology to other producers. During the fourth quarter of 2017, the Company announced the successful start-up of a MAGNUM™ ABS production line at our manufacturing plant at the Zhangjiagang, China site. This will add additional regional production capabilities to our overall portfolio, meeting customer needs for MAGNUM™ ABS in the Asia Pacific automotive, appliance, electronics, lighting and consumer goods markets.
Primary end uses for our ABS products include automotive and construction sheet applications. We maintain a significant share of ABS sales into these markets, which we believe is due to the differentiating attributes of our mABS products, our reputation as a knowledgeable supplier, our broad product mix and our customer collaboration and design capabilities. In 2017, ABS products represented approximately 19% of total segment net sales.
Styrene-Acrylonitrile .  SAN is composed of styrene and acrylonitrile, which together provide clarity, stiffness, enhanced ability to be processed, mechanical strength, barrier properties, chemical resistance and heat resistance. SAN is used mainly in appliances, consumer goods and construction sheets, due to its low-cost, clarity and chemical resistance properties. Within our Basic Plastics segment, we manufacture SAN under the TYRIL™ brand name for use in housewares, appliances, automotive, construction sheets, battery cases and lighting applications. In addition, TYRIL™ is suitable for self-coloring which adds value in many of these uses. In 2017, SAN represented approximately 9% of total segment net sales.
Polycarbonate .  PC has high levels of clarity, impact resistance and temperature resistance. PC can be used in its neat form (prior to any compounding or blending) for markets such as construction sheet, optical media and LED lighting. Additionally, PC can be compounded or blended with other polymers, such as ABS, which imparts specific performance attributes tailored to the product’s end-use.
Our products for glazing and construction sheets are marketed under the CALIBRE™ brand name and offer customers a combination of clarity, heat resistance and impact performance. Glazing and construction sheet represents our largest PC application, and is a key growth focus for us. Key end-markets include the construction industry, with additional opportunities for growth with compounded products in the medical device market, consumer electronics and other applications such as smart meter casings that require plastics with enhanced weatherability, ignition resistance and impact performance. In 2017, PC represented approximately 12% of total segment net sales.

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Competition and Customers
Our principal competitors in our Basic Plastics segment are INEOS Styrolution, Versalis S.p.A., Total S.p.A., Covestro AG, LG Chem Ltd., Elix Polymers, Sinopec Corp., Formosa Chemicals & Fibre Corp., Jiangsu Laidun Baofu Plastifying Co. Ltd., Saudi Basic Industries Corporation, Toray Industries, Inc., and Chi Mei Corporation. In our Basic Plastics segment, we compete primarily based on our ability to offer differentiated and reliable products, the quality of our customer service and the length and depth of our relationships.  
Our customer-centric model focuses on understanding customers’ needs and developing tailored solutions that create value for both parties. For durable applications, we focus our TS&D, R&D and marketing teams on product design engineering initiatives for developing and specifying plastics in the next generation of construction applications, appliances, automotive, and consumer electronics. In non-durable applications, we focus on innovative products that provide clear cost advantages to our customers, serving customers with our cost-advantaged technology and operating excellence. We have leveraged industry-leading product development and technology capabilities in many of our product lines in this segment to develop long-standing customer relationships with many of our customers, including a number who have purchased from us, including our predecessor business operated by Dow prior to the Acquisition, for more than 20 years. We believe that our global presence is an advantage, allowing us to provide customers with consistent product grades and positioning us to strategically serve growth economies.
We have a leading competitive position in many of the products in our Basic Plastics segment. However, for PC, we have a lower competitive position than those of our peers, which may ultimately impact our ability to implement an effective pricing strategy. The ABS market has also experienced a number of capacity rationalizations since 2006. These rationalizations, combined with improved end-market demand, have resulted in a substantial improvement in operating rates since the most recent global economic downturn. We believe the Company’s global footprint make the Basic Plastics segment well-positioned to compete in this market.
Feedstocks Segment
Overview
Our Feedstocks segment is primarily focused on the revenue and profitability related to the Company’s production and procurement of styrene monomer outside of North America. The Feedstocks segment supplied 15% of the styrene monomer capacity out of Europe in 2017. In 2018, the Company expects to produce approximately 700 kilotons of styrene in Western Europe and purchase approximately 185 kilotons of styrene in Asia on a raw material cost basis. With all other inputs remaining equal, a $50 per metric ton change in styrene margin over raw materials would be expected to impact our Feedstock reporting segment’s annual Adjusted EBITDA by approximately $35 million and $9 million in Europe and Asia, respectively.
Products and End Uses
Styrene monomer is a basic building block of plastics and a key input to many of the Company’s products. Styrene monomer is a key raw material for the production of polystyrene, expandable polystyrene, SAN resins, SA latex, SB latex, ABS resins, unsaturated polyethylene resins, and styrene-butadiene rubber.  
Competition and Customers
Our principal competitors in our Feedstocks segment are: INEOS Styrolution, Versalis S.p.A., Total S.p.A., BASF SE, Saudi Basic Industries Corporation, LyondellBasell, Repsol S.A., Sinopec Corp., and Royal Dutch Shell plc. The majority of styrene monomer produced within the Feedstocks segment is consumed by the Company in our own manufacturing activities.
Within styrene monomer, we believe there is a current and longer term trend towards higher styrene margins, due to demand growth, an aging industry asset base, and limited new capacity expected over the next several years that will allow the Company to remain competitive. Global styrene operating rates were approximately 86% in 2017 and are forecasted to increase slightly through 2020. These relatively high operating rates can result in periods of elevated margins due to planned or unplanned production outages.  

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Americas Styrenics Segment
Overview
This segment solely consists of the operations of our 50%-owned joint venture with Chevron Phillips Chemical Company, Americas Styrenics LLC (“Americas Styrenics”), which continues to be a leading producer in North America of both styrene and polystyrene. Specifically, Americas Styrenics is the #1 producer of polystyrene in North America. In 2017, Americas Styrenics supplied 17% of the styrene monomer capacity in North America. Additionally, we received $120.0 million in cash dividends from Americas Styrenics during 2017. We estimate that the contribution to our equity earnings from Americas Styrenics’ polystyrene business was approximately 40% in 2017, 51% in 2016, and 55% in 2015. This translates to a contribution from Americas Styrenics’ polystyrene business to our Adjusted EBITDA of approximately 8% in 2017, 11% in 2016, and 15% in 2015.
Products and End Uses
Styrene monomer is a basic building block of plastics and a key input to many of the Company’s products. Styrene monomer is a key raw material for the production of polystyrene, and in 2017 approximately 58% of the styrene monomer produced by Americas Styrenics is consumed in its own production of polystyrene. The remainder of Americas Styrenics’ product is sold as a key raw material to other manufacturers of polystyrene, expandable polystyrene, SB latex, ABS resins, unsaturated polyethylene resins, and styrene-butadiene rubber.  
Americas Styrenics also produces GPPS, high heat, high impact resin, and STYRON A-TECH™ polystyrene products. Major applications for these polystyrene products include appliances, food packaging, food service disposables, consumer electronics and building and construction materials.
Competition and Customers
Americas Styrenics’ principal competitors are INEOS Styrolution, Total S.p.A. and LyondellBasell. In our Americas Styrenics segment, we compete primarily based on our ability to offer differentiated and reliable products, the quality of our customer service and the length and depth of our relationships.
As a leading styrenics producer in North America, this segment is well-positioned to benefit from the recent consolidation dynamics in the styrene and polystyrene industries within the region. With global utilization rates expected to steadily improve as demand grows in end-markets, we believe opportunities will be created for us, given our scale and geographic reach that will benefit the Americas Styrenics segment. However, like many of competitors in the styrenics market, the aged assets associated with this segment may result in unplanned outages that may adversely impact our service levels and competitive position.
Seasonality
Some of our segments experience seasonality at various times during the year. For example, seasonal changes and weather conditions that typically affect the construction and building materials end markets may result in seasonally lower performance in our Latex Binders and Basic Plastics segments. Likewise, rising demand for consumer electronics for the year-end holiday season typically increases the demand for products within our Performance Plastics segment in the second half of the year. Additionally, certain segments may experience seasonality with respect to local holiday and vacation periods. Our Synthetic Rubber segment, for example, experiences some seasonality with its highest period of demand typically occurring during the first quarter of the year as inventories are built ahead of the summer season. The lowest period of demand normally occurs during the third quarter of the year due to the summer holidays.
Our Relationship with Dow
We have entered into certain agreements with Dow, including the Second Amended and Restated Master Outsourcing Services Agreement, which was modified on June 1, 2013 (“SAR MOSA”), the Amended and Restated MOD5 Computerized Process Control Software, Licenses and Services Agreement, with Rofan Services, Inc. which was modified on June 1, 2013 (“AR MOD5 Agreement”), site and operating services agreements (“SAR SSAs”), and supply agreements.

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The SAR MOSA provides for ongoing worldwide services from Dow, in areas such as information technology, enterprise resource planning, finance, environmental health and safety, training, customer service, marketing and sales support, supply chain and certain sourcing and transactional procurement services. This agreement is effective through December 31, 2020, with automatic two year renewals, barring six months’ notice of non-renewal provided by either party. Subsequent to June 1, 2015, the Company has the ability to terminate all or a portion of the services under the SAR MOSA, subject to payment of termination charges, noting that certain ‘highly integrated’ services follow a separate process for evaluation and termination. In addition, either party may terminate for cause, which includes a bankruptcy, liquidation or similar proceeding by the other party, for material breach which is not cured, or by Dow in the event of our failure to pay for the services thereunder. In the event of a change of control, as defined in the agreement, Dow has the right to terminate the SAR MOSA.
We use SAP’s Enterprise Resource Planning (“ERP”) software systems to support our operations worldwide and to manage our day-to-day business processes and relationships with customers and suppliers. Under the SAR MOSA, Dow provides us with ERP systems support, global data/voice network and server infrastructure for desktop computing, email, file sharing, intranet and internet website access, and mainframe and midrange computer access.
Under the AR MOD5 Agreement, Dow provides worldwide process control technology, including hardware, software licenses and support services, and related enterprise resource planning services. The AR MOD5 Agreement, with a term through December 2020, may be terminated by either party for cause, which includes a bankruptcy, liquidation or similar proceeding by the other party, for material breach which is not cured by us if we no longer wish to receive maintenance and support for any licensed software; or by Dow if we use the licensed software for any purposes other than Company business. Dow may terminate the maintenance and support terms at any time if we fail to make payments when due and the default is not corrected within 30 days from notice, or upon two years written notice us, if Dow has made the decision not to support the software systems, provided that Dow will use commercially reasonable efforts to assist us in locating and transitioning to an alternate service provider. While we are not permitted to use this automation technology for new plants or to substantially expand existing plants, we can use other technology solutions for those situations. We have converted nine of our plants from the AR MOD5 process control technology through a strategic external relationship with ABB Ltd. and expect to convert seven additional plants in 2018, with the remainder of our plants converted by 2020.
In addition, we entered into various site services agreements with Dow to provide site services to the Company at Dow owned sites, which were modified as of June 1, 2013 (the “Amendment Date”). Conversely, we entered into similar agreements with Dow in June 2010, where at Company owned sites, we provide such services to Dow. These SAR SSAs cover general services that are provided at specific facilities co-located with Dow, rather than organization-wide services, and include utilities, site administration, environmental health and safety, site maintenance and supply chain. In certain circumstances, the parties may adjust certain prices and volumes. These agreements generally have 25-year terms from the Amendment Date, with options to renew. These agreements may be terminated at any time by agreement of the parties, or, by either party, for cause, including a bankruptcy, liquidation or similar proceeding by the other party, or under certain circumstances for a material breach which is not cured. In addition, we may terminate for convenience any services that Dow has agreed to provide to us that are identified in any site services agreement as “terminable” with 12 months prior notice to Dow, dependent upon whether the service is highly integrated into Dow operations. Highly integrated services are agreed to be nonterminable. With respect to “nonterminable” services that Dow has agreed to provide to us, such as electricity and steam, we generally cannot terminate such services prior to the termination date unless we experience a production unit shut down for which we provide Dow with 15-months prior notice, or upon payment of a shutdown fee. Upon expiration or termination, we would be obligated to pay a monthly fee to Dow, which obligation extends for a period of 45 (in the case of expiration) to 60 months (in the case of termination) following the respective event of each site services agreement. The agreements under which Dow receives services from us may be terminated under the same circumstances and conditions.
For the years ended December 31, 2017, 2016, and 2015, we incurred a total of $236.4 million, $224.7 million, and $244.8 million in expenses under the SAR MOSA, AR MOD5 Agreement, and site services agreements (which include utilities), including $183.3 million, $174.8 million, and $194.1 million, respectively, for both the variable and fixed cost components of the site services agreements and $53.1 million, $49.9 million, and $50.7 million, respectively, covering all other agreements.
In addition, at the date of the Acquisition, we entered into a contract manufacturing agreement pursuant to which we operate and maintain our SAN facility in Midland, Michigan to produce products for Dow. This agreement has a 25-

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year term, with automatic renewals for five-year terms unless one party gives notice at least 18 months prior to the end of the period. We may terminate any operational service under the agreement in the event that we experience a production unit shutdown, with 15-months prior notice to Dow. Furthermore, the agreement may be terminated by mutual agreement between the parties, by either party on notice that the other party fails to cure non-performance or if the other party is in material breach of a material obligation under the agreement within certain parameters, or because of either party’s insolvency.
We have also entered into certain license agreements pursuant to which we have obtained exclusive licenses to use certain of Dow’s intellectual property in connection with the Styron business as it was conducted by Dow and non-exclusive licenses to use certain Dow intellectual property, other than patents, with respect to products outside of the Styron business as it was conducted by Dow prior to the Acquisition, subject to certain limitations. While our license rights are sufficient to allow us to operate our current business, new growth opportunities in latex binders and, to a lesser extent, plastics involving new products may fall outside of our license rights with Dow. Therefore, our ability to develop new products may be adversely impacted by intellectual property rights that have been retained by Dow.
For the years ended December 31, 2017, 2016, and 2015, purchases and other charges from Dow and its affiliated companies (excluding the SAR MOSA, AR MOD5 Agreement, and site services agreements) were approximately $1,120.8 million, $865.7 million, and $999.4 million, respectively. For the years ended December 31, 2017, 2016, and 2015, sales to Dow and its affiliated companies were approximately $235.2 million, $203.5 million, and $227.0 million, respectively.
We continue to leverage Dow’s scale and operational capabilities by procuring certain raw materials, utilities, site services, and other information technology and business services from Dow. In connection with the Acquisition, we entered into several agreements with Dow relating to the provision of certain products and services and other operational arrangements. Dow provides significant operating and other services, and certain raw materials used in the production of our products, under agreements that are important to our business. The failure of Dow to perform their obligations, or the termination of these agreements, could adversely affect our operations. Significant capital expenditures would be required to integrate these capabilities into our own operations.  See Item 1A— Risk Factors .
Sources and Availability of Raw Materials
The prices of our key raw materials are volatile and can fluctuate significantly over time. While the predominant reason for this volatility is the impact of market imbalances in supply and demand from time to time, energy prices may also impact the volatility of some of our raw materials. The table below shows our key raw materials by reporting segment.

 	 	 	Performance Materials	 	 	Basic Plastics & Feedstocks	 	
 	 	 	Latex	 	 	Synthetic	 	 	Performance	 	 	Basic	 	 	 	 	 	Americas	 	
 	 	 	Binders	 	 	Rubber	 	 	Plastics	 	 	Plastics	 	 	Feedstocks	 	 	Styrenics	 	
Benzene	 	 	 	 	 	 	 	 	 	 	 	 	 	 	X	 	 	X	 	
Bisphenol A	 	 	 	 	 	 	 	 	 	 	 	X	 	 	 	 	 	 	 	
Butadiene	 	 	X	 	 	X	 	 	 	 	 	 	 	 	 	 	 	 	 	
Ethylene	 	 	 	 	 	 	 	 	 	 	 	 	 	 	X	 	 	X	 	
Polycarbonate	 	 	 	 	 	 	 	 	X	 	 	 	 	 	 	 	 	 	 	
Styrenic resins	 	 	 	 	 	 	 	 	X	 	 	 	 	 	 	 	 	 	 	
Styrene	 	 	X	 	 	X	 	 	 	 	 	X	 	 	X	 	 	X	 	
We have supply contracts in place to help maintain our supply of raw materials at competitive market prices and seek to implement the most efficient and reliable raw material strategy for each of our segments, including maintaining a balance between contracted and spot purchases of raw materials. We also produce raw materials for use by our businesses, such as styrene monomer.  
In 2017, we obtained approximately 31% of our raw materials from Dow (based on aggregate purchase price). While Dow provides a significant portion of our raw materials to us pursuant to supply agreements, we have developed a comprehensive strategy for obtaining additional sources of supply where needed. Our 2010 agreements with Dow for

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ethylene, benzene, and butadiene have 10-year terms with automatic 2-year renewal provisions. Minimum and maximum monthly contract quantities were established based on historical consumption rates, and our pricing terms are based on commodity indices in the relevant geography.  
In 2017, Dow supplied us with approximately 97% of our benzene requirements and 100% of our ethylene requirements through 10-year contracts that commenced in 2010 and include automatic 2-year renewal provisions. Dow is our largest supplier for these materials in Europe, where we purchase directly from Dow’s existing butadiene extraction facilities pursuant to the terms of a 10-year contract that commenced in 2010 and includes an automatic 2-year renewal term. Other supply sources in Europe include major producers with contract terms of up to five years at competitive market prices. Supply to North America and Asia are exclusively from other major third party producers via supply contracts.
In addition to purchasing styrene through long-term strategic contracts and spot market purchases, we produce styrene internally from purchased ethylene and benzene at our own manufacturing sites. These sources provided 42%, 14%, and 44%, respectively, of our supply in 2017. With this mix of purchased and produced styrene, we seek to optimize our overall costs of securing styrene through efficient logistics, manufacturing economics and market dynamics.
BPA is the major raw material associated with PC production. This raw material is produced by a subsidiary of Olin Corporation and is supplied via pipeline to us through a supply contract in Europe that has an initial term expiring in December 2019.
Technology
Our R&D and TS&D activities across our segments focus on identifying needs in our customers’ end-markets. As part of our customer-centric model, our R&D/TS&D organization interfaces with our sales and marketing teams and directly with customers to determine their product requirements in light of trends in their industries and market segments. This information is used to select R&D/TS&D projects that are value-enhancing for both our customers and us.
Our R&D facilities support our technological capabilities. In addition to our two SB latex pilot coaters and our product development centers, certain of our businesses operate “mini plants” in Stade and Schkopau, Germany. These mini plants are used to make samples of experimental products for testing, which we believe is a critical step in our new product development process. In addition, in 2017, we opened a new Plastics Research Center, which modernized two existing technical support centers and research lab operations in a single location at our Terneuzen, The Netherlands office location.
R&D and TS&D costs are included in expenses as incurred. Our R&D and TS&D costs were $51.9 million, $51.0 million, and $51.9 million for the years ended December 31, 2017, 2016, and 2015, respectively.
Sales and Marketing
We have a customer-centric business model that has helped us to develop strong relationships with many customers. Our sales and marketing professionals are primarily located at our facilities or at virtual offices within their respective geographies. We have approximately 131 professionals working in sales and marketing around the world, along with approximately 74 customer service professionals and we sell our products to customers in approximately 80 countries. We primarily market our products through our direct sales force. Typically our direct sales are made by our employees in the regions closest to the given customer.
Intellectual Property
We evaluate on a case-by-case basis how best to utilize patents, trademarks, copyrights, trade secrets and other intellectual property in order to protect our products and our critical investments in research and development, manufacturing and marketing. We focus on securing and maintaining patents for certain inventions, while maintaining other inventions as trade secrets, derived from our customer-centric business model, in an effort to maximize the value of our product portfolio and manufacturing capabilities. Our policy is to seek appropriate protection for significant product and process developments in the major markets where the relevant products are manufactured or sold. Patents may cover

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products, processes, intermediate products and product uses. Patents extend for varying periods in accordance with the date of patent application filing and the legal life of patents in the various countries. The protection afforded, which may also vary from country to country, depends upon the type of subject matter covered by the patent and the scope of the claims of the patent.
In most industrial countries, patent protection may be available for new substances and formulations, as well as for unique applications and production processes. However, given the geographical scope of our business and our continued growth strategy, there are regions of the world in which we do business or may do business in the future where intellectual property protection may be limited and difficult to enforce. We maintain strict information security policies and procedures wherever we do business. These information security policies and procedures include data encryption, controls over the disclosure and safekeeping of confidential information, as well as employee awareness training. Moreover, we monitor our competitors’ products and, if circumstances were to dictate that we do so, we would vigorously challenge the actions of others that conflict with our patents, trademarks and other intellectual property rights.
The technologies we utilize in some of our business lines have been in use for many years (e.g., SB latex and ABS) and a number of our patents relating to such technologies have expired or will expire in within the next several years. As patents expire, or are allowed to lapse, the products and processes described and claimed in those patents become generally available for use by the public. We believe that the expiration of any single patent or family of patents that is scheduled to expire in the next 3 years would not materially adversely affect our business or financial results. We believe that our trade secrets relating to manufacturing and other processes used in connection with products to which expiring patents relate will continue to provide us with a competitive advantage after the expiration of these patents.
We use trademarks as a means of differentiating our products. We protect our trademarks against infringement where we deem appropriate. We have successfully registered the TRINSEO™ trademark in over 90 countries and have other trademark applications pending.
Dow has either transferred to us or granted perpetual, royalty-free licenses to us to use Dow’s intellectual property that was used by Dow to operate the Styron business prior to the Acquisition. This intellectual property includes certain processes, compositions and apparatus used in the manufacture of our products. In addition to our license rights to use Dow’s intellectual property related to the Styron business, we have obtained licenses to use Dow’s intellectual property to the extent necessary to perform our obligations under the contracts transferred to us in the Acquisition and to use such intellectual property (other than patents) for products outside of the Styron business as it was conducted by Dow prior to the Acquisition, subject to certain limitations. While we believe our license rights with respect to Dow’s intellectual property are sufficient to allow us to operate our current business, new growth opportunities in latex binders, and to a lesser extent plastics, involving new products may fall outside of our license rights with Dow. Therefore, our ability to develop new products may be impacted by intellectual property rights that have not been licensed to us by Dow. We have the right, with Dow’s cooperation, to directly enforce the patents that are exclusively licensed to us by Dow where infringement is primarily within the scope of our business; but nothing obligates Dow to enforce against third parties the intellectual property rights of Dow that are licensed to us on a non-exclusive basis or where the infringement is primarily outside the scope of our business.
Since our formation on June 17, 2010, we have focused our product innovation on our segments within the Performance Materials division, including Synthetic Rubber, Latex Binders and Performance Plastics. The intellectual property that we have created or acquired since the Acquisition is largely in these segments and covers areas such as material formulations, material process technologies and various end-use industrial applications.

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Environmental, Health, Safety and Product Stewardship
Obtaining, producing and distributing many of our products involve the use, storage, transportation and disposal of toxic and hazardous materials. We are subject to extensive, evolving and increasingly stringent national and local environmental and safety laws and regulations, which address, among other things, the following:
	·		emissions to the air;	
	·		discharges to soils and surface and subsurface waters;	
	·		other releases into the environment;	
	·		prevention, remediation or abatement of releases of hazardous materials into the indoor or outdoor environment;	
	·		generation, handling, storage, transportation, treatment and disposal of waste materials;	
	·		climate change impacts;	
	·		process and maintenance of safe conditions in the workplace;	
	·		registration and evaluation of chemicals;	
	·		production, handling, labeling or use of chemicals used or produced by us; and	
	·		stewardship of products after manufacture.	
We monitor compliance with applicable state, national, and international environmental, health and safety requirements and maintain policies and procedures to monitor and control environmental, health and safety risks, which may in some circumstances exceed the requirements imposed by applicable law. We have a strong environmental, health and safety organization with a staff of professionals who are responsible for environmental, health, safety and product regulatory compliance and stewardship in addition to the standards, tools and services purchased from Dow. We supplement our programs and Dow’s services with our participation in trade associations which monitor developments in legislation impacting our businesses. Additionally, our Supplier Code of Conduct includes our expectations for our suppliers to comply with applicable laws and regulations and encourages them to adhere to the highest principles of environmental responsibility.
We follow the American Chemistry Council Responsible Care® Guiding Principles for our global facilities and products and last received third party certification of our Responsible Care® Management System in September 2016. Many of our facilities have been certified to ISO 14001 and other ISO management systems. We have a mature corporate environmental, health and safety audit program for all of our facilities. We focus on emergency preparedness and crisis planning and drills, at both the facility and corporate level. We expect that stringent environmental regulations will continue to be imposed on us and our industry in general.
Sustainability and Climate Change
We recognize that climate change has had and will continue to have significant impacts on our environment, particularly as it relates to extreme weather conditions, rising sea levels, and regulations limiting the emission of greenhouse gases. In some jurisdictions, like Germany, we comply with extensive regulations required as a result of nationwide or local greenhouse gas targets and resource conservation requirements.
We track and publicly report our greenhouse gas emissions, water usage, and energy consumptions and our facilities work to improve our performance at reducing chemical emissions, water usage and energy consumption. Our Sustainability and Corporate Social Responsibility Report, which is available on our website, provides our most recent sustainability highlights for our products, performance and operations. The report also profiles how our products help our customers improve their own sustainability in areas such as LED lighting, green tires, building insulation, smart meters, life-saving medical devices, and lighter weight vehicles.
In recognition of the importance of sustainability, climate change and corporate social responsibility, we have established a multidisciplinary Sustainability Council, made up of a cross-functional group of Company leaders focused on sustainability, including the benefits and risks related to climate change and our corporate social responsibility programs. We do not expect the costs to comply with legislation enacted as a result of climate change and other sustainability efforts will be material to our operations and consolidated financial position.

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Chemical Registration and Regulation
We are also subject to a growing number of chemical control requirements globally, including the U.S. Toxic Substances Control Act (“TSCA”), which was recently amended, and requires companies to provide more information to the EPA as part of the EPA’s increased responsibilities regarding the assessment of chemical risks so that unreasonable risks can be mitigated. Registration, Evaluation, and Authorization of Chemicals (“REACH”), the regulatory system for chemical management in the EU, requires EU manufacturers and importers to disclose information on the properties of their substances that meet certain volume or toxicological criteria and register the information in a central database to be maintained by the European Chemicals Agency. Other jurisdictions have enacted legislation similar to REACH, including China, Japan and Korea.
Some of our products are also subject to food contact regulations or are used in the production of medical devices, for which our customers are regulated. We actively monitor the progress of these and other legislative developments.  We also maintain policies and programs to restrict the application of certain products in areas that could present safety or litigation risks, including a business risk review process to review new applications.
We also monitor the scientific and legislative dialogue around the safety of BPA, a feedstock material for PC. While this dialogue has taken place for a number of years, recently, it has focused on a concern by regulators and others that low levels of BPA could be released from plastics and impact human health and the environment. The European Chemicals Agency (“ECHA”) is now regulating the use of BPA under REACH. However, we have not seen a material impact on our products or manufacturing operations as a result. Additionally, we have not been significantly impacted by BPA’s appearance on the State of California’s Proposition 65 list because our products contain concentrations less than the Maximum Allowable Dose Levels, and therefore are not subject to the warning requirements of this regulation. After releasing for public comment a new comprehensive study in February 2018 which addressed the potential for health effects from long-term, low dose exposure to BPA, the U.S. Food and Drug Administration reaffirmed that BPA is safe at the current levels occurring in food for food contact applications. This study will now be available to inform the European Food Safety Authority (“EFSA”), which has been tasked by ECHA with reevaluating the toxicity of BPA.
We do not expect that the costs to comply with chemical control requirements will be material to our operations and consolidated financial position.
Environmental Remediation
Environmental laws and regulations require mitigation or remediation of the effects of the disposal or release of chemical substances. Under some of these regulations, as the current owner or operator of a property, we could be held liable for the costs of removal or remediation of hazardous substances on or under the property, without regard to whether we knew of or caused the contamination, and regardless of whether the practices that resulted in the contamination were permitted at the time they occurred. At our Allyn’s Point, Connecticut property we lease a portion of the property to our joint venture, Americas Styrenics, for its operations, which includes a regulated hazardous waste boiler. Potential liabilities resulting from our owner status are addressed through financial assurance mechanisms and other agreements. Many of our production sites have an extended history of industrial use, and it is impossible to predict precisely what effect these laws and regulations will have on us in the future. Soil and groundwater contamination has occurred at some of the sites, and might occur or be discovered at other sites. Subject to certain monetary and temporal limitations, Dow is obligated to indemnify and hold us harmless with respect to releases of hazardous material that existed at our sites prior to our separation from Dow in June 2010. However, we cannot be certain that Dow will fully honor the indemnity or that the indemnity will be sufficient to satisfy all claims that we may incur. In addition, we face the risk that future claims might fall outside of the scope of the indemnity, particularly if we experience a release of hazardous materials that occurs in the future or at any time after our separation from Dow. Except for minor monitoring activities that we are performing in Livorno, Italy pursuant to an agreement with Dow, we do not currently have any material obligations to perform environmental remediation on our properties, and any active remedial projects on our properties are being performed by Dow pursuant to its indemnification obligations or for any Superfund sites. We conduct comprehensive environmental due diligence for potential acquisitions to mitigate the risk of assuming obligations to conduct material levels of environmental remediation.

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Security
We recognize the importance of security and safety to our employees and the community. Physical security measures have been combined with process safety measures (including the use of technology), and emergency response preparedness into integrated security plans. We have conducted vulnerability assessments at our operating facilities in the U.S. and high priority sites worldwide and identified and implemented appropriate measures to protect these facilities from physical and cyber-attacks. Effort and resources in assessing security vulnerabilities and taking steps to reinforce security at our manufacturing facilities will continue to be required to comply with U.S. Department of Homeland Security (“DHS”) and other requirements.
We use Dow’s information security program and systems and have expanded our own information security resources, policies, programs and preparedness to respond to potential information security breaches and to maintain compliance with the increasing amount of data privacy laws and regulation.
Employees
As of December 31, 2017, we had 2,214 employees worldwide. Nearly 78% of our personnel are located at the various manufacturing sites, research and development, pilot coating, paper fabrication and testing and technology centers. The remaining employees are located at operating centers, virtual locations or geographically dispersed marketing and sales locations. Our Midland, Michigan site is the only U.S. facility with union representation for its 52 hourly operations personnel, and employees at certain of our locations are represented by work councils. We consider relations with our personnel and the various labor organizations to be good. There have been no labor strikes or work stoppages in these locations in recent history.
Available Information
Our annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, are available free of charge through the Investor Relations section of our website, www.trinseo.com, as soon as reasonably practicable after the reports are electronically filed or furnished with the U.S. Securities and Exchange Commission. We provide this website and the information contained in or connected to it for informational purposes only. That information is not part of this Annual Report.
Item 1A.    Risk Factors 
Risks Related to Our Business
Volatility in energy and the cost of the raw materials utilized for our products, or disruption in the supply of the raw materials utilized for our products, may adversely affect our financial condition and results of operations or cause our financial results to differ materially from our forecasts.
Our results of operations can be directly affected, positively and negatively, by volatility in the cost of our raw materials, which are subject to global supply and demand and other factors beyond our control. Our principal raw materials (benzene, ethylene, butadiene, BPA and styrene) together represent approximately 65% of our total cost of goods sold. Additionally, we use natural gas and electricity to operate our facilities and generate heat and steam for our various manufacturing processes. Crude oil prices also impact our raw material and energy costs. Generally, higher crude oil prices lead to higher costs of natural gas and raw materials, although some raw materials are impacted less than others. Volatility in the cost of energy or raw materials makes it more challenging to manage pricing and pass the increases on to our customers in a timely manner. We believe that rapid changes in pricing also can affect the volume our customers consume. As a result, our gross profit and margins could also be adversely affected and our financial results may differ materially from our forecasts.
We have long-term supply agreements with Dow for ethylene, benzene, and butadiene, which are critical raw materials to our business and expire in June 2020. These raw materials and other less critical materials amount to approximately 31% of our raw materials (based on aggregate purchase price). The remainder is purchased via other third-party suppliers on a global basis. As our Dow contracts and other third-party contracts expire, we may be unable to

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renew these contracts or obtain new long-term supply agreements on terms comparable or favorable to us, depending on market conditions, which may significantly impact our operations.  See Item 1— Business —   Sources and Availability of Raw Materials .
If the availability of any of our principal raw materials is limited, we may be unable to produce some of our products in the quantities demanded by our customers, which could have an adverse effect on plant utilization and our sales of products requiring such raw materials. Suppliers may have temporary limitations preventing them from meeting our requirements, and we may not be able to obtain substitute alternative suppliers in a timely manner or on favorable terms.
 
Conditions in the global economy and capital markets may adversely affect our results of operations, financial condition and cash flows.
Our products are sold in markets that are sensitive to changes in general economic conditions, such as sales of automotive and construction products. Downturns in general economic conditions can cause fluctuations in demand for our products, product prices, volumes and margins.
Turbulence in the credit markets, fluctuating commodity prices, volatile exchange rates and other challenges affecting the global economy can affect us and our customers. Instability in financial and commodity markets throughout the world may cause, among other things, severely diminished liquidity and credit availability, rating downgrades of certain investments and declining valuations and pricing volatility of others, volatile energy and raw materials costs, geopolitical issues and failure and the potential failure of major financial institutions. Adverse events affecting the health of the economy, including sovereign debt and economic crises, refugee crises, terrorism, Brexit, rising protectionism, and the threat of war, could have a negative impact on the health of the global economy. These developments, or the perception that any of them could occur, may have a material adverse effect on global economic conditions or on the stability of global financial markets. During any period of uncertainty or heightened market volatility, consumer confidence may decline which could lead to a decline in demand for our products or a shift to lower-margin products, which could adversely affect sales of our products and our profitability and could also result in impairments of certain of our assets.
Deterioration in the financial and credit market heightens the risk of customer bankruptcies and delay in payment. We are unable to predict the duration of the current economic conditions or their effects on financial markets, our business and results of operations. If economic conditions deteriorate, our results of operations, financial condition and cash flows could be materially adversely affected.
We may engage in strategic acquisitions or dispositions of certain assets and/or businesses that could affect our business, results of operations, financial condition and liquidity.
We may selectively pursue complementary acquisitions and joint ventures, each of which inherently involves a number of risks and presents financial, managerial and operational challenges, including, but not limited to:
	·		potential disruption of our ongoing business and distraction of management;	
	·		difficulty with integration of personnel and financial and other systems;	
	·		hiring additional management and other critical personnel; and	
	·		increasing the scope, geographic diversity and complexity of our operations.	
In addition, we may encounter unforeseen obstacles or costs in the integration of acquired businesses. Also, the presence of one or more material liabilities of an acquired company that are unknown to us at the time of acquisition may have a material adverse effect on our business or financial results. Our acquisition and joint venture strategy may not be successfully received by customers, and we may not realize any anticipated benefits from acquisitions or joint ventures.
We may also opportunistically pursue dispositions of certain assets and/or businesses, which may involve material amounts of assets or lines of business, and adversely affect our results of operations, financial condition and liquidity. If any such dispositions were to occur, under the terms of the Credit Agreement governing our Senior Credit Facility and the Indenture, we may be required to apply the proceeds of the sale to repay any borrowings under our Senior Credit Facility or our 2025 Senior Notes. Dispositions may also involve continued financial involvement in the divested business, such as through continuing equity ownership, transition service agreements, guarantees, indemnities or other

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current or contingent financial obligations. Under these arrangements, performance by the divested businesses or other conditions outside our control could affect our future financial results.
Capital projects may have lengthy deadlines during which market conditions may deteriorate between the capital expenditure’s approval date and the conclusion of the project, negatively impacting projected returns. If we are unable to execute on our capital projects within their expected budget and timelines, or if the market conditions assumed in our projections deteriorate, our business, financial condition, results of operations and cash flows could be materially and adversely affected.
Delays or cost increases related to capital spending programs involving engineering, procurement and construction of facilities or manufacturing lines could materially adversely affect our ability to achieve forecasted operating results. Project delays or budget overages may arise as a result of unpredictable events, which may be beyond our control, including, but not limited to:

	·		denial of or delay in receiving requisite regulatory approvals, licenses and/or permits;	
	·		unanticipated increases in the cost of construction materials, labor, or utilities;	
	·		disruptions in transportation of components or construction materials;	
	·		adverse weather conditions or natural disasters, equipment malfunctions, explosions, fires or spills affecting our facilities, or those of vendors or suppliers;	
	·		shortages of sufficiently skilled labor, or labor disagreements resulting in unplanned work stoppages; or	
	·		non-performance by, or disputes with, vendors, partners, suppliers, contractors or subcontractors.	
Furthermore, presumed demand for the technologies or products provided by the manufacturing facilities or lines being constructed may deteriorate during the project period. If we were unable to stay within a project’s overall timeline or budget, or if market conditions change, it could materially and adversely affect our business, financial condition, results of operations and cash flows.
Production at our manufacturing facilities could be disrupted for a variety of reasons. Disruptions could expose us to significant losses or liabilities.
The hazards and risks of disruption associated with chemical manufacturing and the related storage and transportation of raw materials, products and wastes exist in our operations and the operations of other occupants with whom we share manufacturing sites. These potential risks of disruption include, but are not necessarily limited to:
	·		pipeline and storage tank leaks and ruptures;	
	·		explosions and fires;	
	·		inclement or unusual weather and natural disasters, which may be aggravated by climate change;	
	·		terrorist attacks;	
	·		failure of mechanical, process safety and pollution control equipment;	
	·		failures or delays in properly implementing new technologies and processes;	
	·		chemical spills and other discharge or releases of toxic or hazardous substances or gases; and	
	·		exposure to toxic chemicals.	
These hazards could expose employees, customers, the community and others to toxic chemicals and other hazards, contaminate the environment, damage property, result in personal injury or death, lead to an interruption or suspension of operations, damage our reputation and adversely affect the productivity and profitability of a particular manufacturing facility or us as a whole, and result in the need for remediation, governmental enforcement, regulatory shutdowns, the imposition of government fines and penalties, and claims brought by governmental entities or third parties. Legal claims and regulatory actions could subject us to both civil and criminal penalties, which could affect our product sales, reputation and profitability. Furthermore, the environmental, health and safety compliance, management systems, and emergency response and crisis management plans we have in place may not address or foresee all potential risks or causes of disruption.
If disruptions occur, alternative facilities with sufficient capacity or capabilities may not be available, may cost substantially more or may take a significant time to start production. Each of these scenarios could negatively affect our business and financial performance. If one of our key manufacturing facilities is unable to produce our products for an extended period of time, our sales may be reduced by the shortfall caused by the disruption and we may not be able to

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meet our customers’ needs, which could cause them to seek other suppliers. Furthermore, to the extent a production disruption occurs at a manufacturing facility that has been operating at or near full capacity, the resulting shortage of our product could be particularly harmful because production at the manufacturing facility may not be able to reach levels achieved prior to the disruption. Our insurance policies may not fully insure against all potential causes of disruption due to limitations and exclusions in those policies. Therefore, incidents that significantly disrupt our operations may expose us to significant losses and/or liabilities.
We are subject to customs, international trade, export control, and antitrust laws that could require us to modify our current business practices and incur increased costs.
We are subject to numerous regulations, including customs and international trade laws, export/import control laws, and associated regulations. These laws and regulations limit the countries in which we can do business; the persons or entities with whom we can do business; the products which we can buy or sell; and the terms under which we can do business, including anti-dumping restrictions. In addition, we are subject to antitrust laws and zoning and occupancy laws that regulate manufacturers generally and/or govern the importation, promotion and sale of our products, the operation of factories and warehouse facilities and our relationship with our customers, suppliers and competitors. If any of these laws or regulations were to change or were violated by our management, employees, suppliers, buying agents or trading companies, the costs of certain goods could increase, or we could experience delays in shipments of our goods, be subject to fines or penalties, or suffer reputational harm, which could reduce demand for our products and hurt our business and negatively impact results of operations. In addition, in some areas we benefit from certain trade protections, including anti-dumping protection and the EU’s Authorized Economic Operator program, which provides expedited customs treatment for materials crossing national borders. If we were to lose these protections, our results of operations could be adversely affected.
Dow provides significant operating and other services, and certain raw materials used in the production of our products, under agreements that are important to our business. The failure of Dow to perform its obligations, or the termination of these agreements, could adversely affect our operations.
Prior to our inception, we were operated by Dow, which has provided and continues to provide services under certain agreements that are important to our business. We are a party to:
	·		The SAR MOSA, an outsourcing service agreement pursuant to which Dow provides certain administrative and business services to us for our operations;	
	·		The AR MOD5 agreement, an outsourcing service agreement pursuant to which Dow provides worldwide process control technology and related enterprise resource planning services;	
	·		supply and sales agreements pursuant to which Dow, among other things, provides us with raw materials, including ethylene, benzene, and butadiene; and	
	·		an operating services agreement pursuant to which Dow will operate and maintain certain of our facilities at Rheinmunster, Germany as well as employ and provide almost all of the staff for this facility.	
Under the terms of the above agreements, either party is permitted to terminate the applicable agreement in a variety of situations, including in the event of the other party’s uncured material breach, insolvency, change of control or cessation of operations. Should Dow fail to provide these services or raw materials, or should any of the above agreements be terminated, we would be forced to obtain these services and raw materials from third parties or provide them ourselves. Additionally, if Dow terminates agreements pursuant to which we are obligated to provide certain services, we may lose the fees received by us under these agreements. The failure of Dow to perform its obligations under, or the termination of, any of these contracts could adversely affect our operations and, depending on market conditions at the time of any such termination, we may not be able to enter into substitute arrangements in a timely manner, or on terms as favorable to us. For more information regarding our relationship with Dow, please see Item 1— Business — Our Relationship with Dow .
Joint ventures may not operate according to their business plans if we or our partners fail to fulfill our or their obligations, or differences in views among our joint venture partners result in delayed decisions, which may

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adversely affect our results of operations and may force us to dedicate additional resources to these joint ventures.
For the year ended December 31, 2017, we received dividends of $120.0 million from our Americas Styrenics joint venture. We may enter into additional joint ventures in the future. The nature of a joint venture requires us to share control with unaffiliated third parties. If joint venture partners do not fulfill their obligations, the affected joint venture may not be able to operate according to its business plan. In that case, our results of operations may be adversely affected and we may be required to increase the level of our commitment to the joint venture. Differences in views among joint venture participants and our inability to unilaterally implement sales and production strategies or determine cash distributions from joint ventures may significantly impact short-term and longer term financial results, financial condition and the value of our ordinary shares.
Our current and future level of indebtedness of our subsidiaries could adversely affect our financial condition.
As of December 31, 2017, our indebtedness totaled approximately $1.2 billion. Additionally, as of December 31, 2017, the Company had $360.2 million (net of $14.8 million outstanding letters of credit) of funds available for borrowings under our 2022 Revolving Facility, as well as $122.1 million of funds available for borrowings under our Accounts Receivable Securitization Facility. Our level of indebtedness could have important consequences, including, but not limited to:
	·		increasing our vulnerability to economic downturns and adverse industry conditions;	
	·		compromising our flexibility to capitalize on business opportunities and to react to competitive pressures, as compared to our competitors;	
	·		placing us at a disadvantage compared to other, less leveraged competitors or competitors with comparable debt at more favorable interest rates; and	
	·		increasing our cost of borrowing.	
Although the Senior Credit Facility and the Indenture governing our 2025 Senior Notes contain restrictions on the incurrence of additional indebtedness, these restrictions are subject to a number of qualifications and exceptions and the indebtedness incurred in compliance with these restrictions could be substantial. Also, we are not prevented from incurring obligations that do not constitute “indebtedness” as defined in the Senior Credit Facility or the Indenture, such as operating leases and trade payables. If new debt is added to our subsidiaries’ current debt levels, the risks related to indebtedness that we now face could intensify.
In addition, a substantial portion of our subsidiaries’ current indebtedness is secured by substantially all of our assets, which may make it more difficult to secure additional borrowings at reasonable costs. If we default or declare bankruptcy, after these obligations are met, there may not be sufficient funds or assets to satisfy our subordinate interests, including those of our shareholders. For more information regarding our indebtedness, please see Item 7— Management’s Discussion and Analysis of Financial Conditions and Results of Operations— Capital Resources, Indebtedness and Liquidity.
The terms of our subsidiaries’ indebtedness may restrict our current and future operations, particularly our ability to respond to change or to take certain actions.
The Indenture and the Credit Agreement governing the Borrowers’ Senior Credit Facility contain a number of covenants imposing certain restrictions on our subsidiaries’ businesses. These restrictions may affect our ability to operate our business and may limit our ability to take advantage of business opportunities. These agreements restrict, among other things, our subsidiaries’ ability to:
	·		sell assets;	
	·		incur additional indebtedness;	
	·		pay dividends to Trinseo S.A.;	
	·		make investments or acquisitions;	
	·		incur liens;	
	·		repurchase or redeem capital stock;	
	·		engage in mergers or consolidations;	
	·		materially alter the business they conduct;	

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	·		engage in transactions with affiliates; and	
	·		consolidate, merge or transfer all or substantially all of their assets.	
The ability of our subsidiaries to comply with the covenants and financial ratios and tests contained in the Indenture and Credit Agreement, to pay interest on indebtedness, fund working capital, and make anticipated capital expenditures depends on our future performance, which is subject to general economic conditions and other factors, some of which are beyond our control. There can be no assurance that our business will generate sufficient cash flow from operations or that future borrowings will be available under our Senior Credit Facility to fund liquidity needs in an amount sufficient to enable them to service their indebtedness. Furthermore, if we need additional capital for general corporate purposes or to execute on an expansion strategy, there can be no assurance that this capital will be available on satisfactory terms or at all.
A failure to repay amounts owed under the Senior Credit Facility or 2025 Senior Notes at maturity would result in a default. In addition, a breach of any of the covenants in the Senior Credit Facility or Indenture governing our 2025 Senior Notes or our inability to comply with the required financial ratios or limits could result in a default. If a default occurs, lenders may refuse to lend us additional funds and the lenders or noteholders could declare all of the debt and any accrued interest and fees immediately due and payable. A default under one of our subsidiaries’ debt agreements may trigger a cross-default under our other debt agreements. For more information regarding our indebtedness, please see Item 7— Management’s Discussion and Analysis of Financial Conditions and Results of Operations— Capital Resources, Indebtedness and Liquidity.
We may be subject to losses due to liabilities or lawsuits related to contaminated land we own or operate or arising out of environmental damage or personal injuries associated with exposure to chemicals or the release of chemicals.
Under the Comprehensive Environmental Response, Compensation and Liability Act, or CERCLA and similar statutes outside the U.S., the current or former owner or operator of a property contaminated by hazardous substance releases is subject to strict, unlimited, joint, several and retroactive liability for the investigation and remediation of the property, and also may be liable for natural resource damages associated with the releases. We also face the risk that individuals could seek damages for personal injury due to exposure to chemicals at our facilities, chemicals which have been released from our facilities, chemicals otherwise owned or controlled by us, or chemicals which allegedly migrated from products containing our materials. We may be subject to claims with respect to workplace exposure, workers’ compensation and other health and safety matters. Legal claims and regulatory actions could subject us to both civil and criminal penalties, which could affect our reputation as well as our results of operations, financial condition, and liquidity.
There are several properties which we now own on which Dow has been conducting remediation to address historical contamination. Those properties include Allyn’s Point, Connecticut; Dalton, Georgia; and Livorno, Italy. There are other properties with historical contamination that are owned by Dow that we lease for our operations, including our facility in Midland, Michigan. While we did not assume the liabilities associated with these properties in the U.S., because CERCLA and similar laws can impose liability for contamination on the current owner or operator of a property, even if it did not create the contamination, there is a possibility that a governmental authority or private party could seek to include us in an action or claim for remediation or damages, even though the contamination may have occurred prior to our ownership or occupancy. While Dow has agreed to indemnify us for liability for releases of hazardous materials that occurred prior to our separation from Dow, the indemnity is subject to monetary and temporal limitations, and we cannot be certain that Dow will fully honor the indemnity or that the indemnity will be sufficient to satisfy all claims that we may incur. In addition, we face the risk that future claims might fall partially or fully outside of the scope of the indemnity, particularly if there is a release of hazardous materials that occurs in the future or at any time after our separation from Dow or if the condition requiring remediation is attributable to a combination of events or operations occurring prior to and after our separation from Dow.
We are party to certain license agreements with Dow relating to intellectual property that is essential to our business. Because of this relationship, we may have limited ability to expand our use of certain intellectual property beyond the field of the license or to police infringement that may be harmful to our business.
In connection with the Acquisition, we acquired ownership of, or in some cases, a worldwide right and license to use, certain patents, patent applications and other intellectual property of Dow that were used by Dow to operate our

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business segments or held by Dow primarily for the benefit of our business segments, prior to the Acquisition. Generally, we acquired ownership of the intellectual property that was primarily used in our business segments and acquired a license to a more limited set of intellectual property that had broader application within Dow beyond our core business segments. Our license from Dow is perpetual, irrevocable, fully paid, and royalty-free. Furthermore, our license from Dow is exclusive within our business segments for certain patents and patent applications that were used by Dow primarily in the Styron business prior to the Acquisition, subject to licenses previously granted by Dow, and to certain retained rights of Dow, including Dow’s retained right to use patents and patent applications outside of our business segments and for internal consumption by Dow. Our license from Dow relates to polymeric compositions, manufacturing processes and end applications for the polymeric compositions; and is limited to use in defined areas corresponding to our current business segments excluding certain products and end-use application technology retained by Dow. Our ability to develop, manufacture or sell products and technology outside of these defined areas may be impeded by the intellectual property rights that have been retained by Dow, which could adversely affect our business, financial condition and results of operations. Additionally, infringement on these intellectual property rights could also impact our business and competitive position. We may not be able to enforce our rights, and Dow may be unwilling to enforce its rights, with respect to this intellectual property that has been licensed by Dow.
Regulatory and statutory changes applicable to our raw materials and products and our customers’ products could require material expenditures, changes in our operations and could adversely affect our financial condition and results of operations.
Changes in environmental, health and safety regulations, in jurisdictions where we manufacture and sell our products, could lead to a decrease in demand for our products. In addition to changes in regulations, health and safety concerns could increase the costs incurred by our customers to use our products and otherwise limit the use of these products, which could lead to decreased demand for these products. Such a decrease in demand likely would have an adverse effect on our business and results of operations. Materials such as acrylonitrile, ethylbenzene, styrene, butadiene, BPA and halogenated flame retardant are used in the manufacturing of our products and have come under scrutiny due to potentially significant or perceived health and safety concerns.
Additionally, these regulatory regimes currently require significant compliance expenditures by us, and changes applicable to our raw materials and products or our customers’ products could require significant additional expenditures by us, or changes in our operations.
Our products are also used in a variety of end-uses that have specific regulatory requirements such as those relating to products that have contact with food or medical device end-uses. Our customers or distributors may not follow our policies and advice regarding the safe use and application of our products, which may unknowingly expose us to third-party claims. We and many of the applications for the products in the end markets in which we sell our products are regulated by various national and local rules, laws and regulations, such as the TSCA. Changes in regulations could result in additional compliance costs, seizures, confiscations, recall or monetary fines, any of which could prevent or inhibit the development, distribution and sale of our products. Changes in environmental and safety laws and regulations banning or restricting the use of these residual materials in our products, or our customers’ products, could adversely affect our results of operations and financial condition. Failure to appropriately manage safety, human health, product liability and environmental risks associated with our products, product life cycles and production processes could adversely impact employees, communities, stakeholders, our reputation and the results of our operations.
Compliance with extensive and evolving environmental, health and safety laws may require substantial expenditures.
We use large quantities of hazardous substances, generate hazardous wastes and emit wastewater and air pollutants in our manufacturing operations. Consequently, our operations are subject to extensive environmental, health and safety laws and regulations at both the national and local level in multiple jurisdictions. Many of these laws and regulations have become more stringent over time and the costs of compliance with these requirements may increase, including costs associated with any capital investments for pollution control facilities. In addition, our production facilities and operations require operating permits, licenses or other approvals that may be subject to periodic renewal and, in circumstances of noncompliance, may be subject to revocation. The necessary licenses, permits or other approvals may not be issued or continue in effect, and any issued licenses, permits or approvals may contain more stringent limitations that restrict our operations or that require further expenditures to meet the permit requirements.

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This continuing focus on climate change in jurisdictions in which we operate could result in new, potentially diverging or inconsistent, environmental regulations that may negatively affect us. This could cause us to incur additional costs in complying with any new regulations, which may adversely impact our operations and financial condition.  Compliance with more stringent environmental requirements would likely increase our costs of transportation and storage of raw materials and finished products, as well as the costs of storage and disposal of wastes. Additionally, we may incur substantial costs, including penalties, fines, damages, criminal or civil sanctions and remediation costs for the failure to comply with these laws or permit requirements.
Fluctuations in currency exchange rates may significantly impact our results of operations and may significantly affect the comparability of our results between financial periods.
Our operations are conducted by subsidiaries in many countries. The results of the operations and the financial position of these subsidiaries are reported in the relevant foreign currencies and then translated into U.S. dollars at the applicable exchange rates for inclusion in our consolidated financial statements. The main currency to which we are exposed is the euro, noting that approximately 60% of our net sales were generated in Europe for the year ended December 31, 2017. To a lesser degree, we are also exposed to other currencies, including the Chinese yuan, Swiss franc, and Indonesian rupiah. The exchange rates between these currencies and the U.S. dollar in recent years have fluctuated significantly and may continue to do so in the future. A depreciation of these currencies against the U.S. dollar, in particular the euro, will decrease the U.S. dollar equivalent of the amounts derived from these operations reported in our consolidated financial statements and an appreciation of these currencies will result in a corresponding increase in such amounts. Because some of our raw material costs are procured in U.S. dollars rather than on these currencies, depreciation of these currencies may have an adverse effect on our profit margins or our reported results of operations. Conversely, to the extent that we are required to pay for goods or services in foreign currencies, the appreciation of such currencies against the U.S. dollar will tend to negatively impact our results of operations. In addition, currency fluctuations may affect the comparability of our results of operations between financial periods.
We incur currency translation risk whenever we enter into either a purchase or sale transaction using a currency other than the local currency of the transacting entity. From time to time, we enter into foreign exchange forward contracts to hedge fluctuations associated with certain monetary assets and liabilities, primarily accounts receivable, accounts payable and certain intercompany obligations. However, attempts to hedge against foreign currency fluctuation risk may be unsuccessful and result in an adverse impact to our operating results. Given the volatility of exchange rates, there can be no assurance that we will be able to effectively manage our currency translation risks or that any volatility in currency exchange rates will not have a material adverse effect on our financial condition or results of operations.
If we are not able to continue the technological innovation and successful commercial introduction of new products, our customers may turn to other producers to meet their requirements.
Our industry and the end markets into which we sell our products experience periodic technological changes and ongoing product improvements. Our customers may introduce new generations of their own products or require new technological and increased performance specifications that would require us to develop customized products. Innovation or other changes in our customers’ product performance requirements may also adversely affect the demand for our products. Our future growth will depend on our ability to gauge the direction of the commercial and technological progress in all key end markets, and upon our ability to successfully develop, manufacture and market products in such changing end markets. We need to continue to identify, develop and market innovative products on a timely basis to replace existing products in order to maintain our profit margins and our competitive position. We may not be successful in developing new products and technology that successfully compete with these materials, and our customers may not accept any of our new products. If we fail to keep pace with evolving technological innovations or fail to modify our products in response to our customers’ needs, then our business, financial condition and results of operations could be adversely affected as a result of reduced sales of our products.
As a global business, we are exposed to local business risks in different countries, which could have a material adverse effect on our financial condition or results of operations.
We have significant operations worldwide, including manufacturing facilities, R&D facilities, sales personnel and customer support operations. As of December 31, 2017, we operated, or others operated on our behalf, 30 manufacturing plants (which include a total of 75 production units) at 23 sites around the world, including in Colombia, Germany, The

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Netherlands, Belgium, Finland, Sweden, Italy, China, South Korea, Indonesia, Taiwan, and the United States. Our international operations are subject to risks inherent in doing business in foreign countries, including, but not necessarily limited to:
	·		new and different legal and regulatory requirements in local jurisdictions;	
	·		restrictive labor and employment laws;	
	·		uncertainties regarding interpretation and enforcement of laws and regulations;	
	·		variation in political and economic policy of the local governments and social conditions;	
	·		export duties or import quotas;	
	·		domestic and foreign customs and tariffs or other trade barriers;	
	·		potential staffing difficulties and labor disputes;	
	·		managing and obtaining support and distribution for local operations;	
	·		increased costs of transportation or shipping;	
	·		credit risk and financial conditions of local customers and distributors;	
	·		potential difficulties in protecting intellectual property;	
	·		risk of nationalization of private enterprises by foreign governments;	
	·		potential imposition of restrictions on investments;	
	·		potentially adverse tax consequences, including imposition or increase of withholding and other taxes on remittances and other payments by subsidiaries;	
	·		legal restrictions on doing business in or with certain nations, certain parties and/or certain products;	
	·		foreign currency exchange restrictions and fluctuations; and	
	·		local economic, political and social conditions, including the possibility of hyperinflationary conditions and political instability.	
We may not be successful in developing and implementing policies and strategies to address the foregoing factors in a timely and effective manner at each location where we do business. Consequently, the occurrence of one or more of the foregoing factors could have a material adverse effect on our international operations or upon our financial condition and results of operations.
Our operations in developing markets could expose us to political, economic and regulatory risks that are greater than those we may face in established markets. For example, we operate in some nations that have experienced significant levels of governmental corruption. Any failure by us to ensure that our employees and agents comply with applicable laws and regulations in foreign jurisdictions could result in substantial civil and criminal penalties or restrictions on our ability to conduct business in certain foreign jurisdictions or reputational damage, and our results of operations and financial condition could be materially and adversely affected.
Our business relies on intellectual property and other proprietary information and our failure to adequately protect or effectively enforce our rights could harm our competitive advantages with respect to the manufacturing of some of our products.
Our success depends to a significant degree upon our ability to protect, preserve and enforce our intellectual property rights, including patents, trademarks, licenses, trade secrets and other proprietary information of our business. However, we may be unable to prevent third parties from using our intellectual property and other proprietary information without our authorization or independently developing intellectual property and other proprietary information that is similar to or competes with ours. Any inability by us to effectively prevent the unauthorized use of our intellectual property and other proprietary information by others could reduce or eliminate any competitive advantage we have developed, cause us to lose sales or otherwise harm our business or goodwill. If it becomes necessary for us to initiate litigation to protect our proprietary rights, any proceedings could be burdensome and costly, and we may not prevail.
We may be unable to determine when third parties are using our intellectual property rights without our authorization, particularly our manufacturing processes. In addition, we cannot be certain that any intellectual property rights that we have licensed to third parties are being used only as authorized by the applicable license agreement. The undetected, unremedied, or unauthorized use of our intellectual property rights or the legitimate development or acquisition of intellectual property that is similar to or competes with ours by third parties could reduce or eliminate the

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competitive advantage we have as a result of our intellectual property, adversely affecting our financial condition and results of operations.
If we fail to adequately protect our intellectual property and other proprietary information, including our processes, apparatuses, technology, trade secrets, trade names and proprietary manufacturing know how, methods and compounds, through obtaining patent protection, securing trademark registrations and securing our trade secrets through the use of confidentiality agreements of appropriate scope and other means, our competitive advantages over other producers could be materially adversely affected. If we determine to take legal action to protect, defend or enforce our intellectual property rights, any suits or proceedings could result in significant costs and diversion of our resources and our management’s attention. We may not prevail in any such suits or proceedings. A failure to protect, defend or enforce our intellectual property rights could have an adverse effect on our financial condition and results of operations.
Our products may infringe the intellectual property rights of others, which may cause us to incur unexpected costs or prevent us from selling our products.
Many of our competitors have a substantial amount of intellectual property that we must continually strive to avoid infringing as we improve our own business processes and develop new products and applications. Although it is our policy and intention not to infringe valid patents of which we are aware, we cannot provide assurances that our processes and products and other activities do not and will not infringe issued patents (whether present or future) or other intellectual property rights belonging to others. There nonetheless could be third-party patents that cover our products, processes or technologies, and it is possible that we could be liable for infringement of such patents and could be required to take remedial or curative actions to continue our manufacturing and sales activities with respect to one or more products that are found to be infringing. We may also be subject to indemnity claims by our business partners arising out of claims of their alleged infringement of the patents, trademarks and other intellectual property rights of third parties in connection with their use of our products. Intellectual property litigation often is expensive and time-consuming, regardless of the merits of any claim, and our involvement in such litigation could divert our management’s attention from operating our business. If we were to discover that any of our processes, technologies or products infringe on the valid intellectual property rights of others, we may not be able to obtain the necessary licenses on acceptable terms, or at all, or be able to modify our processes or technologies or re-engineer our products in a manner that is successful in avoiding infringement. Moreover, if we are sued for infringement and lose, we could be required to pay substantial damages and/or be enjoined from using or selling the infringing products or technology. Any of the foregoing could cause us to incur significant costs and prevent us from selling our products and could have an adverse effect on our financial condition and results of operations.
Data security breaches could compromise sensitive information related to our business or the private information of our employees, vendors, and customers, which could adversely affect our business and our reputation.
Cyberattacks or data security breaches could compromise confidential, private, business critical information or cause a failure in our computer or operating systems that may disrupt our operations. We have attractive information assets, including intellectual property, trade secrets and other sensitive, business critical information. We face an ever growing risk of attack from outside our organization (including attack by organized crime, so-called “hacktivists,” and state-sponsored actors) using sophisticated technical and non-technical methodologies (including social engineering and “spear phishing” attacks). We also face risks from internal threats to information security, such as from negligent or dishonest employees or consultants. A successful cyberattack or other breach of security could result in the loss of critical business information and/or could negatively impact operations, which could have a negative impact on our financial results. Furthermore, in addition to using our own systems and infrastructure, we use information systems and infrastructure operated by third-party service providers, including Dow. If our third-party service providers experience an information security breach, depending on the nature of the breach, it could compromise confidential, business critical information or cause a disruption in our operations. In addition, the loss or disclosure of sensitive or private information about our employees, vendors, or customers as a result of such a breach may result in violations of various data privacy

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regulations and expose us to litigation, fines and other penalties. Therefore, any such disruptions to our operations or violations of data privacy laws could negatively impact our reputation and results of operations.
Risks Related to Our Ordinary Shares
We are a Luxembourg company and, as a result, shareholders may have difficulty effecting service of process or litigation against us or our officers and directors.
We are organized under the laws of the Grand Duchy of Luxembourg. Many of our assets are located outside the United States and some of our directors and officers reside outside the United States and most of their assets are located outside the United States. As a result, investors may find it more difficult to effect service of process within the United States upon us or these persons or to enforce outside the United States judgments obtained against us or these persons in U.S. courts, including judgments in actions predicated upon the civil liability provisions of the U.S. federal securities laws. Likewise, it may also be difficult for an investor to enforce in U.S. courts judgments obtained against us or these persons in courts located in jurisdictions outside the United States, including actions predicated upon the civil liability provisions of the U.S. federal securities laws. It may also be difficult for an investor to bring an original action in a Luxembourg court predicated upon the civil liability provisions of the U.S. federal securities laws against us or these persons. Luxembourg law does not recognize a shareholder’s right to bring a derivative action on behalf of a company.
Provisions in our organizational documents and Luxembourg law may deter takeover efforts or other actions that could be beneficial to shareholder value.
Our articles of association and Luxembourg law contain provisions that could make it harder for a third party to acquire us, even if doing so might be beneficial to our shareholders. These provisions include a classified board of directors, the ability of the board of directors to approve a merger or other acquisition and to issue additional ordinary shares without shareholder approval that could be used to dilute a potential hostile acquirer. As a result, you may lose your ability to sell your ordinary shares for a price in excess of the prevailing market price due to these protective measures, and efforts by shareholders to change the direction or management of the company may be unsuccessful.
Pursuant to Luxembourg corporate law, existing shareholders are generally entitled to pre-emptive subscription rights in the event of capital increases and issues of shares against cash contributions. However, our board of directors is authorized to waive, limit or suppress such pre-emptive subscription rights until May 13, 2019. Furthermore, our shareholders may renew, expand or amend this authorization, which could result in the extension of the waiver beyond the initial five year period, at a future general meeting of shareholders.
Item 1B.    Unresolved Staff Comments 
None.
  Item 2.    Properties   
We own and operate 61 production units at 16 sites around the world. In addition, we source products from another 14 production units at 7 joint venture sites. We also own or lease other properties, including office buildings, warehouses, research and development facilities, testing facilities and sales offices.

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The following table sets forth a list of our principal offices, production sites and other facilities as of December 31, 2017:

 	 	 	 	 	 	 	 	 	 	
Site Name	    	Location	    	Leased/owned	    	Products/Functions	    	Business Segments	 	
Corporate Offices	 	 	 	 	 	 	 	 	 	
Berwyn	 	USA (PA)	 	Leased	 	Global operating headquarters	 	Not applicable	 	
Hong Kong	 	Hong Kong	 	Leased	 	Regional operating center	 	Not applicable	 	
Horgen	 	Switzerland	 	Leased	 	Regional operating center	 	Not applicable	 	
Midland	 	USA (MI)	 	Leased	 	Regional operating center	 	Not applicable	 	
 	 	 	 	 	 	 	 	 	 	
Production Sites	 	 	 	 	 	 	 	 	 	
Boehlen*	 	Germany	 	Leased	 	Styrene monomer	 	Feedstocks	 	
Dalton	 	USA (GA)	 	Owned	 	Latex	 	Latex Binders	 	
Hamina	 	Finland	 	Owned	 	Latex	 	Latex Binders	 	
Hsinchu	 	Taiwan	 	Owned	 	Compounds and blends	 	Performance Plastics	 	
Merak++	 	Indonesia	 	Owned	 	Latex, Polystyrene	 	Latex Binders, Basic Plastics	 	
Midland*	 	USA (MI)	 	Leased	 	ABS, Latex, PC, Compounds and blends	 	Latex Binders, Performance Plastics, Basic Plastics	 	
Mussolente	 	Italy	 	Owned	 	Soft-touch polymers and bioplastics	 	Performance Plastics	 	
Norrkoping	 	Sweden	 	Owned	 	Latex	 	Latex Binders	 	
Rheinmunster*	 	Germany	 	Leased	 	Latex	 	Latex Binders	 	
Schkopau*	 	Germany	 	Leased	 	ESBR, SSBR, PBR, Polystyrene	 	Synthetic Rubber, Basic Plastics	 	
Stade*	 	Germany	 	Leased	 	PC	 	Basic Plastics	 	
Terneuzen*	 	The Netherlands	 	Leased	 	Compounds and blends, Latex, Styrene monomer, ABS	 	Latex Binders, Performance Plastics, Basic Plastics, Feedstocks	 	
Tessenderlo*	 	Belgium	 	Leased	 	Polystyrene	 	Basic Plastics	 	
Tsing Yi+	 	Hong Kong	 	Leased	 	Polystyrene	 	Basic Plastics	 	
Ulsan	 	Korea	 	Owned	 	Latex	 	Latex Binders	 	
Zhangjiagang*	 	China	 	Leased	 	Latex, Polystyrene, ABS	 	Latex Binders, Performance Plastics, Basic Plastics	 	
 	 	 	 	 	 	 	 	 	 	
R&D Facilities	 	 	 	 	 	 	 	 	 	
Dalton	 	USA (GA)	 	Owned	 	Latex	 	Latex Binders	 	
Hsinchu	 	Taiwan	 	Owned	 	Performance plastics	 	Performance Plastics	 	
Midland 1300	 	USA (MI)	 	Leased	 	Latex	 	Latex Binders	 	
Midland 1604	 	USA (MI)	 	Leased	 	Performance plastics and Latex	 	Performance Plastics,
Latex Binders	 	
Mussolente	 	Italy	 	Owned	 	Soft-touch polymers and bioplastics	 	Performance Plastics	 	
Rheinmunster	 	Germany	 	Leased	 	Latex	 	Latex Binders	 	
Samstagern	 	Switzerland	 	Leased	 	Latex	 	Latex Binders	 	
Schkopau	 	Germany	 	Leased	 	Synthetic rubber	 	Synthetic Rubber	 	
Shanghai	 	China	 	Leased	 	Latex	 	Latex Binders	 	
Terneuzen	 	The Netherlands	 	Leased	 	Performance plastics	 	Performance Plastics	 	
Tsing Yi	 	Hong Kong	 	Leased	 	Performance plastics	 	Performance Plastics	 	
 	 	 	 	 	 	 	 	 	 	
Joint Venture	 	 	 	 	 	 	 	 	 	
Americas Styrenics	 	 	 	 	 	 	 	 	 	
Allyn’s Point	 	USA (CT)	 	Leased	 	Polystyrene	 	Americas Styrenics	 	
Cartegena	 	Colombia	 	Owned	 	Polystyrene	 	Americas Styrenics	 	
Hanging Rock	 	USA (OH)	 	Leased	 	Polystyrene	 	Americas Styrenics	 	
Joliet	 	USA (IL)	 	Owned	 	Polystyrene	 	Americas Styrenics	 	
Marietta	 	USA (OH)	 	Owned	 	Polystyrene	 	Americas Styrenics	 	
St. James	 	USA (LA)	 	Owned	 	Styrene monomer	 	Americas Styrenics	 	
Torrance	 	USA (CA)	 	Leased	 	Polystyrene	 	Americas Styrenics	 	

* Facility co-located with Dow facilities under ground lease agreements. Plant facilities are owned by us.
+ Facility located on property owned by the applicable government.
++ Facility located on property under certification with right to build.
 
We believe that our properties and equipment are generally in good operating condition and are adequate for our present needs. Production capacity at our sites can vary depending upon product mix and operating conditions.

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Our global production facilities are certified to ISO 9001 standards. Our manufacturing facilities have established reliability and maintenance programs and leverage production between sites to maximize efficiency.
Our plants have similar layouts, technology and manufacturing processes, depending upon the product being manufactured. We believe this global uniformity creates a key competitive advantage for us, and helps lower overall operating costs.
Item 3.    Legal Proceedings   
From time to time we may be subject to various legal claims and proceedings incidental to the normal conduct of business, relating to such matters as product liability, antitrust, competition, waste disposal practices, release of chemicals into the environment and other matters that may arise in the ordinary course of our business. We currently believe that there is no litigation pending that is likely to have a material adverse effect on our business. Regardless of the outcome, legal proceedings can have an adverse impact on us because of defense and settlement costs, diversion of management resources and other factors.
Item 4.    Mine Safety Disclosures   
Not applicable.
PART II 
Item 5  .    Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities  
The principal market on which our ordinary shares is traded is the New York Stock Exchange, under the ticker symbol “TSE”. As of February 26, 2018, there were two record holders of our ordinary shares and 48,777,934 ordinary shares issued and 43,280,500 ordinary shares outstanding. By including persons holding shares in broker accounts under street names, however, we estimate that we have approximately 19,930 beneficial holders.
The table below sets forth the market prices and dividends declared for each quarter of 2017 and 2016.

 	    	Price Range	 	 	Dividends Declared	 	
 	    	High	    	Low	    	 	per share (1)	 	
2017	 	 	 	 	 	 	 	 	 	 	
Quarter ended March 31, 2017	 	$	72.60	 	$	59.25	 	$	0.30	 	
Quarter ended June 30, 2017	 	$	70.15	 	$	59.55	 	$	0.36	 	
Quarter ended September 30, 2017	 	$	72.05	 	$	57.70	 	$	0.36	 	
Quarter ended December 31, 2017	 	$	75.20	 	$	66.20	 	$	0.36	 	
 	 	 	 	 	 	 	 	 	 	 	
2016	 	 	 	 	 	 	 	 	 	 	
Quarter ended March 31, 2016	 	$	39.23	 	$	21.92	 	$	 —	 	
Quarter ended June 30, 2016	 	$	49.72	 	$	36.19	 	$	0.30	 	
Quarter ended September 30, 2016	 	$	60.02	 	$	41.60	 	$	0.30	 	
Quarter ended December 31, 2016	 	$	62.30	 	$	44.70	 	$	0.30	 	

	(1)		The dividends paid for the periods presented are considered repayments of equity under Luxembourg law.	
While the Company anticipates paying cash dividends for the foreseeable future, future determination to pay dividends or make other cash distributions to our shareholders will be at the discretion of our board of directors, subject to compliance with covenants in current and future agreements governing our indebtedness and applicable Luxembourg law, and will depend upon our results of operations, financial condition, capital requirements and other factors that our board of directors deems relevant. Further discussion of these restrictions is included in Item 7— Management’s Discussion and Analysis of Financial Conditions and Results of Operations .

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Performance Graph
The following performance graph reflects the comparative changes in the value from June 12, 2014, the first trading day of our ordinary shares on the NYSE, through December 31, 2017, assuming an initial investment of $100 and the reinvestment of dividends or other cash distributions, if any, in (1) our ordinary shares, (2) the S&P 500 Index, and (3) the S&P Small Cap 600 Chemicals Index. The share price performance shown in the graph is not necessarily indicative of future price performance.

 
Purchases of equity securities by the Company and affiliated purchasers

    Issuer Purchases of Equity Securities	
Period	 	Total number of shares purchased	 	Average price
paid per share	 	Total number of shares purchased as part of publicly announced plans or programs	 	Approximate number of shares that may yet be purchased under the plans or programs	
October 1 - October 31, 2017	 	 —	 	$	 —	 	 —	 	1,856,345	(1)	
November 1 - November 30, 2017	 	 —	 	$	 —	 	 —	 	1,856,345	(1)	
December 1 - December 31, 2017	 	346,257	 	$	72.12	 	346,257	 	1,510,088	(1)	
Total	 	346,257	 	$	72.12	 	346,257	 	 	 	

(1) The general meeting of our shareholders on June 21, 2017 authorized the Company to sunset the 2016 share repurchase authorization and replace it with a new authorization to repurchase up to 4.0 million ordinary shares at a price per share of not less than $1.00 and not more than $1,000. This authorization ends on June 21, 2020 or on the date of its renewal by a subsequent general meeting of shareholders. On June 22, 2017 the Company announced that

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the board of directors had authorized the Company to repurchase, subject to market and other conditions, up to 2.0 million shares over the subsequent 18 months under the 2017 share repurchase authorization.
Luxembourg Tax Considerations
Tax Regime Applicable to Capital Gains Realized Upon Disposal of Shares
The following is a summary discussion of the material Luxembourg tax considerations of the acquisition, ownership and disposition of your ordinary shares that may be applicable to you. It is not intended to be, nor should it be construed to be, legal or tax advice. This discussion is based on Luxembourg laws and regulations as they stand on the date of this report and is subject to any change in law or regulations or changes in interpretation or application thereof (and which may possibly have a retroactive effect). Investors should therefore consult their own professional advisers as to the effects of state, local or foreign laws and regulations, including Luxembourg tax law and regulations, to which they may be subject. As used herein, a “Luxembourg individual” means an individual resident in Luxembourg who is subject to personal income tax (impôt sur le revenu) on his or her worldwide income from Luxembourg or foreign sources, and a “Luxembourg corporate holder” means a company (that is, a fully taxable collectivité within the meaning of Article 159 of the Luxembourg Income Tax Law) resident in Luxembourg subject to corporate income tax (impôt sur le revenu des collectivités) on its worldwide income from Luxembourg or foreign sources. For purposes of this discussion, Luxembourg individuals and Luxembourg corporate holders of our ordinary shares are collectively referred to as “Luxembourg Holders.” A “non-Luxembourg Holder” means any investor in our ordinary shares other than a Luxembourg Holder.
Luxembourg individual holders . For Luxembourg individuals holding (together, directly or indirectly, with his or her spouse or civil partner or minor children) 10% or less of the share capital of Trinseo, capital gains will only be taxable if they are realized on a sale of shares, which takes place before their acquisition or within the first six months following their acquisition. The capital gain or liquidation proceeds will be taxed at progressive income tax rates. 
For Luxembourg individuals holding (together with his/her spouse or civil partner and minor children) directly or indirectly more than 10% of the capital of Trinseo, capital gains will be taxable at a special rate, if the disposal or liquidation takes place:
	·		within six months from the acquisition, the capital gain or liquidation proceeds will be taxed at progressive income tax rates (ranging from 0 to 42.0% for 2018).	
	·		after six months from the acquisition, the capital gain or the liquidation proceeds will be taxed at a reduced tax rate corresponding to half of the investor’s global tax rate and EUR 50,000 (doubled for taxpayers filing jointly) of gains realized over a ten-year period are exempt from taxation.	
Luxembourg corporate holders. Capital gains realized upon the disposal of shares by a Luxembourg corporate holder will in principle be subject to corporate income tax and municipal business tax. The combined applicable rate for Luxembourg corporate holders with taxable income in excess of EUR 30,000 will be 24.75% for fiscal year ended 2018 for a Luxembourg corporate holder established in Luxembourg-City. An exemption from such taxes may be available to the Luxembourg corporate holder pursuant to Article 166 of the Luxembourg Income Tax law subject to the fulfillment of the conditions set forth therein. The scope of the capital gains exemption may be limited in the cases provided by the Grand Ducal Decree of December 21, 2001. 
Non-Luxembourg Holders
An individual non-Luxembourg Holder of shares will only be subject to Luxembourg taxation on capital gains arising upon disposal of such shares if such holder has (together with his or her spouse or civil partner and underage children) directly or indirectly held more than 10% of the capital of Trinseo, at any time during the five years preceding the disposal, and either (i) such holder has been a resident of Luxembourg for tax purposes for at least 15 years and has become a non-resident within the five years preceding the realization of the gain, subject to any applicable tax treaty, or (ii) the disposal of shares occurs within six months from their acquisition (or prior to their actual acquisition), subject to any applicable tax treaty. If we and a U.S. relevant holder are eligible for the benefits of the Convention Between the Government of the Grand Duchy of Luxembourg and the Government of the United States for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income and Capital (the “Luxembourg-U.S.

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Treaty”), such U.S. relevant holder generally should not be subject to Luxembourg tax on the gain from the disposal of such shares unless such gain is attributable to a permanent establishment of such U.S. relevant holder in Luxembourg. Subject to any restrictions imposed by the substantially and regularly traded clause in the limitation on benefits article of the Luxembourg-U.S. treaty, we expect to be eligible for the benefits of the Luxembourg-U.S. Treaty.
A corporate non-Luxembourg Holder (that is, a collectivité within the meaning of Article 159 of the Luxembourg Income Tax Law), which has a permanent establishment, a permanent representative or fixed place of business in Luxembourg to which shares would be attributable, will bear corporate income tax and municipal business tax on a gain realized on a disposal of such shares as set forth above for a Luxembourg corporate holder. However, gains realized on the sale of the shares may benefit from the full exemption provided for by Article 166 of the Luxembourg Income Tax Law and by the Grand Ducal Decree of December 21, 2001 subject in each case to fulfillment of the conditions set out therein.
A corporate non-Luxembourg Holder, which has a permanent establishment, permanent representative or fixed place of business in Luxembourg to which the shares would be attributable will not be subject to any Luxembourg tax on a gain realized on a disposal of such shares unless such holder holds, directly or through tax transparent entities, more than 10% of the share capital of Trinseo, and the disposal of shares occurs within six months from their acquisition (or prior to their actual acquisition), subject to any applicable tax treaty. If we and a U.S. corporate holder without a permanent establishment in Luxembourg are eligible for the benefits of the Luxembourg-U.S. Treaty, such U.S. corporate holder generally should not be subject to Luxembourg tax on the gain from the disposal of such shares.
Tax Regime Applicable to Distributions
Withholding Tax. Dividend distributions by Trinseo are subject to a withholding tax of 15%. Distributions by the Company sourced from a reduction of capital as defined in Article 97 (3) of the Luxembourg Income Tax Law including, among others, share premium should not be subject to withholding tax provided that such reduction of capital is motivated by serious business reasons as meant in said provision. We or the applicable paying agent will withhold on a distribution if required by applicable law.
Where a withholding needs to be applied, the rate of the withholding tax may be reduced pursuant to the double tax treaty existing between Luxembourg and the country of residence of the relevant holder, subject to the fulfillment of the conditions set forth therein. If we and a U.S. relevant holder are eligible for the benefits of the Luxembourg-U.S. Treaty, the rate of withholding on distributions generally is 15% or 5% if the U.S. relevant holder is a beneficial owner that owns at least 10% of our voting stock. 
No withholding tax applies if the distribution is made to (i) a Luxembourg resident corporate holder (that is, a fully taxable collectivité within the meaning of Article 159 of the Luxembourg Income Tax Law), (ii) a corporation which is resident of a Member State of the European Union and is referred to by article 2 of the Council Directive of July 23, 1990 concerning the common fiscal regime applicable to parent and subsidiary companies of different member states (90/435/EEC), (iii) a corporation or a cooperative resident in Norway, Iceland or Liechtenstein and subject to a tax comparable to corporate income tax as provided by Luxembourg Income Tax Law, (iv) a corporation resident in Switzerland which is subject to corporate income tax in Switzerland without benefiting from an exemption, (v) a corporation subject to a tax comparable to corporate income tax as provided by Luxembourg Income Tax Law which is resident in a country that has concluded a tax treaty with Luxembourg and (vi) a Luxembourg permanent establishment of one of the above-mentioned categories, provided each time that at the date of payment, the holder has held or commits itself to continue to hold directly or through a tax transparent vehicle, during an uninterrupted period of at least twelve months, shares representing at least 10% of the share capital of Trinseo or which had an acquisition price of at least EUR 1,200,000.
Equity Repayment. The repayment of equity, by the Company is not treated as a dividend distribution under Luxembourg law, and therefore is not subject to any withholding tax, provided: (i) the Company has no statutory reserves or profits at the Company level, and (ii) the capital decrease is motivated by sound business reasons. The Company did not have any statutory profits or reserves as of December 31, 2017. In case the Company does not have sound business reasons to provide a repayment of equity, the entire amount repaid will be subject to a 15% withholding tax, unless the conditions for an exemption or a reduction from the withholding tax on dividends set forth above are met. 

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Luxembourg Holders
Dividend and liquidation proceeds are in principle taxable at the general income tax rates indicated above. A partial dividend exemption may be available to Luxembourg Holders pursuant to Article 115.15a of the Luxembourg Income Tax law or a full dividend exemption may be available to a Luxembourg corporate holder pursuant to Article 166 of the Luxembourg Income Tax law, subject to the fulfillment of the conditions set forth therein.
Non-Luxembourg Holders
Non-Luxembourg holders of the shares who have neither a permanent establishment, permanent representative nor a fixed place of business in Luxembourg to which the shares would be attributable are not liable for any Luxembourg tax on dividends paid on the shares, other than a potential withholding tax as described above.
Net Wealth Tax
Luxembourg Holders
Luxembourg net wealth tax will not be levied on a Luxembourg Holder with respect to the shares held unless the Luxembourg Holder is an entity subject to net wealth tax in Luxembourg.
Net wealth tax is levied annually at the rate of 0.5% on the net wealth of enterprises resident in Luxembourg, as determined for net wealth tax purposes. The shares may be exempt from net wealth tax subject to the conditions set forth by Article 60 of the Law of October 16, 1934 on the valuation of assets (Bewertungsgesetz), as amended.
Non-Luxembourg Holders
Luxembourg net wealth tax will not be levied on a non-Luxembourg Holder with respect to the shares held unless the shares are attributable to an enterprise or part thereof which is carried on through a permanent establishment or a permanent representative in Luxembourg.
Stamp and Registration Taxes
No registration tax or stamp duty will be payable by a holder of shares in Luxembourg solely upon the disposal of shares or by sale or exchange.
Item 6.    Selected Financial Data   
The following tables set forth our selected historical financial and operating data and other information, certain of which has been revised to correct immaterial errors included within previously issued financial statements. For more information on these revisions, refer to Note 2 in the consolidated financial statements included in this Annual Report.
The historical results of operations data for the years ended December 31, 2017, 2016, and 2015, and the historical balance sheet data as of December 31, 2017 and 2016 presented below were derived from our audited consolidated financial statements and the related notes thereto included elsewhere within this Annual Report. The historical results of operations data for the years ended December 31, 2014 and 2013 and the historical balance sheet data as of December 31, 2015, 2014, and 2013 were derived from our audited financial statements and the related notes thereto not included within this Annual Report. Our historical results are not necessarily indicative of the results to be expected for any future periods.
You should read the information contained in this table in conjunction with Item 7— Management’s Discussion and Analysis of Financial Condition and Results of Operations and the audited financial statements and the related notes thereto included elsewhere in this Annual Report.
Definitions of capitalized terms not defined herein appear in the notes to our consolidated financial statements.

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 	 	Year Ended	 	
 	 	December 31,	 	
(In millions, except per share data)	 	2017	 	2016	 	2015	 	2014	 	2013	 	
Statement of Operations Data:	  	 	 	    	 	 	    	 	 	    	 	 	    	 	 	 	
Net sales (1)	 	$	4,448.1	 	$	3,716.6	 	$	3,971.9	 	$	5,128.0	 	$	5,307.4	 	
Cost of sales (1)	 	 	3,794.1	 	 	3,129.0	 	 	3,502.8	 	 	4,830.6	 	 	4,949.4	 	
Gross profit	 	 	654.0	 	 	587.6	 	 	469.1	 	 	297.4	 	 	358.0	 	
Selling, general and administrative expenses	 	 	239.0	 	 	241.5	 	 	208.0	 	 	232.6	 	 	216.9	 	
Equity in earnings of unconsolidated affiliates	 	 	123.7	 	 	144.7	 	 	140.2	 	 	47.7	 	 	39.1	 	
Operating income	 	 	538.7	 	 	490.8	 	 	401.3	 	 	112.5	 	 	180.2	 	
Interest expense, net	 	 	70.1	 	 	75.0	 	 	93.2	 	 	124.9	 	 	132.0	 	
Loss on extinguishment of long-term debt (2)	 	 	65.3	 	 	 —	 	 	95.2	 	 	7.4	 	 	20.7	 	
Other expense (income), net	 	 	(7.8)	 	 	10.5	 	 	9.1	 	 	27.8	 	 	27.9	 	
Income (loss) before income taxes	 	 	411.1	 	 	405.3	 	 	203.8	 	 	(47.6)	 	 	(0.4)	 	
Provision for income taxes	 	 	82.8	 	 	87.0	 	 	70.2	 	 	19.7	 	 	21.8	 	
Net income (loss)	 	$	328.3	 	$	318.3	 	$	133.6	 	$	(67.3)	 	$	(22.2)	 	
Weighted average shares— basic	 	 	43.8	 	 	46.5	 	 	48.8	 	 	43.5	 	 	37.3	 	
Net income (loss) per share— basic	 	$	7.49	 	$	6.84	 	$	2.74	 	$	(1.55)	 	$	(0.60)	 	
Weighted average shares— diluted	 	 	45.0	 	 	47.5	 	 	49.0	 	 	43.5	 	 	37.3	 	
Net income (loss) per share— diluted	 	$	7.30	 	$	6.70	 	$	2.73	 	$	(1.55)	 	$	(0.60)	 	
Dividends per share	 	$	1.38	 	$	0.90	 	$	 —	 	$	 —	 	$	 —	 	

 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	 	Year Ended	 	
 	 	December 31,	 	
(In millions)	 	2017	 	2016	 	2015	 	2014	 	2013	 	
Other Financial Data:	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	 	
Depreciation and amortization	 	$	110.6	 	$	96.4	 	$	96.8	 	$	103.7	 	$	95.2	 	
Capital expenditures, net of subsidy (3)	 	 	147.4	 	 	123.9	 	 	107.1	 	 	98.6	 	 	54.8	 	
Balance Sheet Data:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Cash and cash equivalents	 	$	432.8	 	$	465.1	 	$	431.3	 	$	220.8	 	$	196.5	 	
Working capital (4)	 	 	1,019.6	 	 	890.7	 	 	839.8	 	 	748.7	 	 	810.2	 	
Total assets	 	 	2,772.0	 	 	2,421.3	 	 	2,270.7	 	 	2,367.9	 	 	2,588.4	 	
Debt (5)	 	 	1,199.7	 	 	1,187.4	 	 	1,207.8	 	 	1,202.2	 	 	1,336.4	 	
Total liabilities	 	 	2,097.2	 	 	1,973.6	 	 	1,879.0	 	 	2,044.4	 	 	2,243.0	 	
Total shareholders’ equity	 	 	674.8	 	 	447.7	 	 	391.7	 	 	323.6	 	 	345.5	 	

	(1)		Net sales and cost of sales increase or decrease, in part, based on fluctuations in raw material prices. Consistent with industry practice, and as permitted under agreements with many of our customers, raw material price changes are generally passed through to customers by means of corresponding price changes. See Item 7A— Quantitative and Qualitative Disclosures about Market Risk — Commodity Price Risk.	
	(2)		This charge for the year ended December 31, 2017 relates to the Company’s third quarter debt refinancing and was comprised of a $53.0 million call premium paid to retire the Company’s 2022 Senior Notes and a $12.3 million write-off of unamortized deferred financing fees and unamortized original issue discount. The charge for the year ended December 31, 2015 related to our May 2015 debt refinancing. The charge for the year ended December 31, 2014 related to the July 2014 redemption of $132.5 million in aggregate principal amount of the Company’s Senior Notes due 2019. And the charge for the year ended December 31, 2013, related to the January 2013 amendment of our 2018 Senior Secured Credit Facility and the repayment of $1,239.0 million of outstanding term loans.	
	(3)		Represents capital expenditures, net of government subsidies received for SSBR expansion of $2.2 million and $18.8 million for the years ended December 31, 2015 and 2013, respectively. No government subsidies were received for the other periods presented above. Included in capital expenditures for the year ended December 31, 2017 were amounts related to a number of key growth initiatives, including the Company’s ABS capacity expansion in China, a 50 KT increase to our global production capabilities in SSBR, and the opening of our new SSBR pilot plant in Germany. During the year ended December 31, 2016, the Company completed the upgrade of our legacy	

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enterprise resource planning (“ERP”) environment to the latest version of SAP, resulting in capitalized software of $57.4 million. The majority of the capital spending for this project occurred in 2016. For the year ended December 31, 2014, capital expenditures include approximately $26.1 million for the reacquisition of production capacity rights at the Company’s rubber production facility in Schkopau, Germany.	
	(4)		Working capital is defined as current assets minus current liabilities.	
	(5)		Balances presented for all periods within the “Debt” caption above reflect gross debt balances outstanding at each period end and are not net of unamortized deferred financing fees and unamortized original issue discount.	

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  Item 7.    Management’s Discussion and Analysis of Financial Condition and Results of Operations   
The following discussion summarizes the significant factors affecting the operating results, financial condition, liquidity and cash flows of our Company as of and for the periods presented below. The following discussion and analysis should be read in conjunction with Item 6 — “Selected Financial Data” and the audited consolidated financial statements and the accompanying notes thereto, included elsewhere within this Annual Report. The statements in this discussion regarding industry outlook, our expectations regarding our future performance, liquidity and capital resources and all other non-historical statements in this discussion are forward-looking statements and are based on the beliefs of our management, as well as assumptions made by, and information currently available to, our management. Actual results could differ materially from those discussed in or implied by forward-looking statements as a result of various factors, including those discussed below and elsewhere within this Annual Report, particularly in Item 1A—“Risk Factors.” Definitions of capitalized terms not defined herein appear in the notes to our consolidated financial statements.
2017 Highlights
We had record performance in fiscal year 2017, with net income of $328.3 million and Adjusted EBITDA of $642.5 million. Additionally, our Latex Binders, Basic Plastics, and Feedstocks segments each had record Adjusted EBITDA for the year. We continued to focus efforts on investing in growth areas, reducing costs through streamlining our portfolio and asset footprint, generating cash, and improving our net leverage and reducing interest expense. Refer to “Non-GAAP Performance Measures” below for further discussion of our use of non-GAAP measures in evaluating our performance. Other highlights of 2017 are described below.
2017 Debt Refinancing
During the third quarter, the Company executed a refinancing of our debt, including:
	·		Issuing $500.0 million aggregate principal amount of 5.375% 2025 Senior Notes;	
	·		Entering the new Senior Credit Facility, which consists of the $375.0 million 2022 Revolving Facility and the $700.0 million 2024 Term Loan B, bearing an interest rate of LIBOR plus 2.50%, subject to a 0.00% LIBOR floor; and	
	·		Using the net proceeds from the above along with available cash to redeem all outstanding indebtedness under our existing 2022 Senior Notes and to repay all outstanding borrowings under our existing 2020 Senior Credit Facility, together with a $53.0 million call premium on the 2022 Senior Notes, accrued and unpaid interest, and fees and other expenses related to the refinancing.	
Additionally, on September 1, 2017, the Company entered into certain fixed-for-fixed cross currency swaps (“CCS”), swapping U.S. dollar principal and interest payments on the newly issued 2025 Senior Notes for euro-denominated payments. Refer to Note 11 in the consolidated financial statements for further details.
The Company expects the aggregate cash interest savings from the refinancing and CCS to be approximately $25.0 million annually at current LIBO rates.
As a result of the refinancing, the Company recorded a loss on extinguishment of long-term debt of $65.3 million during the year ended December 31, 2017. Refer to Note 10 in the consolidated financial statements for further information.
Acquisition of API Plastics
On July 10, 2017, the Company completed the acquisition of API Plastics, for a gross purchase price of $90.6 million, inclusive of $8.4 million of cash acquired, yielding a net purchase price of $82.3 million which is subject to certain customary post-closing adjustments. API Plastics, based in Mussolente, Italy, is a manufacturer of soft-touch polymers and bioplastics, such as thermoplastic elastomers, or TPEs. TPEs can be molded over rigid plastics such as ABS and PC/ABS, which presents opportunities for complementary technology product offerings within our Performance Plastics segment. Refer to Note 3 in the consolidated financial statements for further information.

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Sale of Sumika Styron Polycarbonate
On January 31, 2017, the Company completed the sale of our 50% share in Sumika Styron Polycarbonate to Sumitomo Chemical Company Limited for total sales proceeds of approximately $42.1 million. As a result, the Company recorded a gain on sale of $9.3 million during the year ended December 31, 2017. In addition, the parties have entered into a long-term agreement to continue sourcing polycarbonate resin from Sumika Styron Polycarbonate to the Company’s Performance Plastics segment.
Share Repurchases and Dividends
In June 2017, the Company’s board of directors authorized an increase to our quarterly dividend, from $0.30 per share to $0.36 per share, a 20% increase. In addition, the board of directors authorized the repurchase of up to two million of the Company’s ordinary shares.
During the year ended December 31, 2017, under existing authority from our board of directors, the Company purchased approximately 1.4 million ordinary shares from our shareholders through a series of open market transactions for an aggregate purchase price of $88.9 million (with $1.3 million of additional repurchases not yet settled accrued on the consolidated balance sheet as of December 31, 2017). Additionally, during the year ended December 31, 2017, the Company’s board of directors declared quarterly dividends for an aggregate value of $1.38 per ordinary share, or $61.6 million.
 
Results of Operations
Results of Operations for the Years Ended December 31, 2017, 2016 and 2015
The table below sets forth our historical results of operations, and these results as a percentage of net sales for the periods indicated.
References to portfolio adjustments below represent the impacts of the Company’s acquisition and divestiture activity, including the acquisition of API Plastics and the sale of our joint venture Sumika Styron Polycarbonate during 2017, as well as the sale of our business in Brazil during 2016. Refer to the consolidated financial statements for further information.

 	 	 	 	Year Ended 	 	 	
 	 	 	 	December 31, 	 	 	
($ in millions)	    	 	 	2017	 	%	    	 	2016	 	%	    	    	2015	 	%	 	 	
Net sales	 	 	 	$	4,448.1	 	100	%  	 	$	3,716.6	 	100	%  	    	$	3,971.9	 	100	%  	 	
Cost of sales	 	 	 	 	3,794.1	 	85	%  	 	 	3,129.0	 	84	%  	 	 	3,502.8	 	88	%  	 	
Gross profit	 	 	 	 	654.0	 	15	%  	 	 	587.6	 	16	%  	 	 	469.1	 	12	%  	 	
Selling, general and administrative expenses	 	 	 	 	239.0	 	 5	%  	 	 	241.5	 	 7	%  	 	 	208.0	 	 5	%  	 	
Equity in earnings of unconsolidated affiliates	 	 	 	 	123.7	 	 3	%  	 	 	144.7	 	 4	%  	 	 	140.2	 	 4	%  	 	
Operating income	 	 	 	 	538.7	 	12	%  	 	 	490.8	 	13	%  	 	 	401.3	 	10	%  	 	
Interest expense, net	 	 	 	 	70.1	 	 2	%  	 	 	75.0	 	 2	%  	 	 	93.2	 	 2	%  	 	
Loss on extinguishment of long-term debt	 	 	 	 	65.3	 	 2	%  	 	 	 —	 	 —	%  	 	 	95.2	 	 2	%  	 	
Other expense (income), net	 	 	 	 	(7.8)	 	(0)	%  	 	 	10.5	 	 0	%  	 	 	9.1	 	 0	%  	 	
Income before income taxes	 	 	 	 	411.1	 	 9	%  	 	 	405.3	 	11	%  	 	 	203.8	 	 5	%  	 	
Provision for income taxes	 	 	 	 	82.8	 	 2	%  	 	 	87.0	 	 2	%  	 	 	70.2	 	 2	%  	 	
Net income	 	 	 	$	328.3	 	 7	%  	 	$	318.3	 	 9	%  	 	$	133.6	 	 3	%  	 	
2017 vs. 2016
Net Sales
Of the 20% increase, 18% was due to higher selling prices primarily from the pass through of higher raw material costs, including higher styrene and butadiene costs to customers across our segments. Additionally, 1% of the increase

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was due to slightly higher sales volume, as increases in Performance Plastics, Feedstocks, and Synthetic Rubber sales volume were partially offset by decreases in Latex Binders and Basic Plastics sales volume.
Cost of Sales
Of the 21% increase, 19% was attributable to higher prices for raw materials, primarily related to styrene monomer and butadiene, and an additional 1% of the increase was due to increased sales volume, primarily in Performance Plastics and Synthetic Rubber. Partially offsetting these increases was a 1% decrease related a curtailment gain recorded in the current year as a result of changes to certain of the Company’s pension plans in Europe.
Gross Profit
The increase was primarily attributable to higher margins per unit sold, especially within the Latex Binders, Basic Plastics, and Feedstocks segments, due to more favorable market conditions. Higher sales volume in Performance Plastics, Feedstocks, and Synthetic Rubber was partially offset by lower sales volume in Latex Binders and Basic Plastics, as well as margin compression in Performance Plastics, due to higher raw material costs, and in Synthetic Rubber, due to unfavorable raw material timing impacts.
Selling, General and Administrative Expenses
The $2.5 million year-over-year decrease is comprised of several offsetting factors. Restructuring expenses decreased by $15.9 million, noting $19.9 million in asset impairment and other charges recorded in the prior year as a result of our decision to cease manufacturing operations at our latex facility in Livorno, Italy, partially offset by $3.3 million in charges in the current year related to the upgrade and replacement of the Company’s compounding facility in Terneuzen, The Netherlands as well as an additional $3.1 million of charges related to the Livorno, Italy action discussed above (refer to Note 19 in the consolidated financial statements for further information). Additionally, we recorded a $3.1 million curtailment gain in the current year on certain of the Company’s pension plans in Europe. Offsetting the above decreases in expenses were increased costs incurred supporting growth initiatives of approximately $5.0 million, transaction and integration related costs of $3.4 million related to the API Plastics acquisition, and $3.6 million of asset impairment charges on certain long-lived assets within the Performance Plastics segment.
Equity in Earnings of Unconsolidated Affiliates
Equity earnings decreased in 2017, as equity earnings from Americas Styrenics decreased from $135.8 million in 2016 to $122.9 million in 2017, primarily due to the planned and extended first quarter styrene outage at its St. James, LA facility, including lower margins on second quarter sales of styrene purchased during the outage. Additionally, equity earnings from Sumika Styron Polycarbonate decreased from $8.9 million in 2016 to $0.8 million in 2017, as the Company completed the sale of our 50% share in the entity to Sumitomo Chemical Company Limited in January 2017, and therefore did not have an ownership interest in the joint venture for the majority of the year ended December 31, 2017. Refer to Note 4 in the consolidated financial statements for further information. 
Interest Expense, Net
The decrease was primarily attributable to a reduction in interest rates from the Company’s debt refinancing during the third quarter of 2017 as well as lower deferred financing fee amortization recorded into interest expense from our Accounts Receivable Securitization Facility. Refer to Note 10 in the consolidated financial statements for further information.
Loss on Extinguishment of Long-Term Debt
Loss on extinguishment of long-term debt was $65.3 million for the year ended December 31, 2017, which related to the Company’s debt refinancing during the third quarter of 2017. This amount was comprised of a $53.0 million call premium paid to retire the Company’s 2022 Senior Notes and a $11.5 million write-off of unamortized deferred financing fees related to these notes, as well as the write-off of $0.8 million of unamortized deferred financing fees and unamortized original issue discount related to the termination of the Company’s 2021 Term Loan B.

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Other Expense (Income), net
Other income, net for the year ended December 31, 2017 was $7.8 million, which primarily includes a $9.3 million gain related to the sale of the Company’s 50% share in Sumika Styron Polycarbonate in January 2017 (refer to Note 4 in the consolidated financial statements for further information). Additionally, net foreign exchange transaction gains for the period were $1.4 million, which included $20.6 million of foreign exchange transaction gains primarily due to the remeasurement of our euro denominated payables due to the relative changes in rates between the U.S. dollar and the euro during the period, offset by $19.2 million of losses from our foreign exchange forward contracts. Additionally, other expenses included $1.2 million of fees incurred in conjunction with the Company’s debt refinancing during the third quarter of 2017.
Other expense, net for the year ended December 31, 2016 was $10.5 million, primarily due to an impairment charge for the loss on sale of our latex binders and automotive businesses in Brazil of approximately $15.1 million. Refer to Note 3 in the consolidated financial statements for further information. Additionally, net foreign exchange transaction losses for the period were $1.8 million. Included in these net losses of $1.8 million were foreign exchange transaction losses of $5.5 million, primarily from the remeasurement of our euro denominated payables due to the relative changes in rates between the U.S. dollar and the euro during the period, offset by $3.7 million in gains from our foreign exchange forward contracts. Partially offsetting these net losses was $6.4 million of other income, which primarily related to the effective settlement of certain value-added tax positions during the period.
Provision for Income Taxes
Provision for income taxes for 2017 totaled $82.8 million resulting in an effective tax rate of 20%. Provision for income taxes for 2016 totaled $87.0 million resulting in an effective tax rate of 21%. The decrease in provision for income taxes was primarily due to the recording of a previously unrecognized tax benefit in the amount of $8.5 million, including penalties and interest , upon completion of the 2010 through 2013 audit with the German taxing authority during the year ended December 31, 2017. This decrease was partially offset by $3.1 million of one-time income tax expense related to the revaluation of our U.S. federal deferred tax assets and liabilities at the new U.S. federal corporate income tax rate of 21% in accordance with the enactment of the “Tax Cuts and Jobs Act” signed into law on December 22, 2017.
In addition, the decrease in provision for income taxes was partially offset by the tax effect on the increase in income before income taxes from, $405.3 million for the year ended December 31, 2016 to $411.1 million for the year ended December 31, 2017.
2016 vs. 2015
Net Sales
Of the 6% decrease in net sales, 5% was due to lower selling prices primarily due to the pass through of lower raw material costs, particularly lower styrene and butadiene costs to customers across our segments. Also impacting this reduction in net sales was a decrease of 1% due to sales volume, primarily within Performance Plastics and Basic Plastics.
Cost of Sales
Of the 11% decrease in cost of sales, 9% was attributable to lower prices for raw materials, primarily butadiene and styrene monomer, while an additional 1% of the decrease was due to lower sales volume primarily within Performance Plastics and Basic Plastics. Also contributing to the decrease was a 1% impact from the reduction in fixed costs due to prior year plant maintenance activities.
Gross Profit
The increase in gross profit was primarily attributable to higher margins across our segments, especially in styrene, styrenic polymers, and PC within Feedstocks and Basic Plastics. Partially offsetting this increase was an unfavorable volume impact, primarily within Performance Plastics and Basic Plastics.

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Selling, General and Administrative Expenses
The majority of the increase in SG&A expenses was due to $15.8 million of increased restructuring charges, primarily related to the Company’s decision to cease manufacturing activities at our latex binders facility in Livorno, Italy. In addition, $8.4 million of the increase was related to an increase in stock-based compensation expense, which included $2.9 million of one-time accelerated expense as a result of the complete liquidation of the former Parent’s ownership interest in the Company through secondary offerings. Refer to Notes 19 and 16, respectively, in the consolidated financial statements for further information. Also impacting this change were increased employee benefit costs, costs from additional resources supporting growth initiatives, and certain costs incurred to support secondary offerings of the former Parent.
Equity in Earnings of Unconsolidated Affiliates
Equity earnings increased slightly in 2016, as equity earnings from Americas Styrenics increased by $0.5 million, from $135.3 million in 2015 to $135.8 million in 2016, and equity earnings from Sumika Styron Polycarbonate increased by $4.0 million, from $4.9 million in 2015 to $8.9 million in 2016. The improvement in results from Sumika Styron Polycarbonate was primarily due to improved PC market conditions.
Interest Expense, Net
The decrease in interest expense, net was primarily attributable to the impact of the debt refinancing executed in May 2015, which reduced applicable interest rates. Refer to Note 10 in the consolidated financial statements for further information.
Loss on Extinguishment of Long-Term Debt
Loss on extinguishment of long-term debt was $95.2 million for the year ended December 31, 2015 related to the Company’s debt refinancing in May 2015. This amount was comprised of a $68.6 million call premium paid to retire the Company’s 2019 Senior Notes and a $25.9 million write-off of unamortized deferred financing fees related to these notes, as well as the write-off of $0.7 million of unamortized deferred financing fees related to the termination of the Company’s 2018 Revolving Facility.

Other Expense (Income), net
Other expense, net for the year ended December 31, 2016 was $10.5 million, primarily resulting from an impairment charge for the loss on sale of our latex binders and automotive businesses in Brazil of approximately $15.1 million. Refer to Note 3 in the consolidated financial statements for further information. Additionally, net foreign exchange transaction losses for the period were $1.8 million. Included in these net losses of $1.8 million were foreign exchange transaction losses of $5.5 million, primarily due to the remeasurement of our euro denominated payables due to the relative changes in rates between the U.S. dollar and the euro during the period, offset by $3.7 million in gains from our foreign exchange forward contracts. Partially offsetting these net losses was $6.4 million of other income, which primarily related to the effective settlement of certain value-added tax positions during the period.
Other expense, net for the year ended December 31, 2015 was $9.1 million, which consisted primarily of net foreign exchange transaction losses of approximately $10.4 million. These net foreign exchange transactions losses were comprised of foreign exchange transaction gains of $6.1 million primarily due to the remeasurement of our euro denominated payables due to the relative changes in rates between the U.S. dollar and the euro during the period, more than offset by losses of $16.5 million recorded during the period related to the Company’s foreign exchange forward contracts. Partially offsetting these net foreign exchange transactions losses was other miscellaneous income of $1.3 million.
Provision for Income Taxes
Provision for income taxes for 2016 totaled $87.0 million resulting in an effective tax rate of 21%. Provision for income taxes for 2015 totaled $70.2 million resulting in an effective tax rate of 34%. The increase in provision for income taxes was primarily due to the $201.5 million increase in income before income taxes, from $203.8 million for the year ended December 31, 2015 to $405.3 million for the year ended December 31, 2016.

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This increase in the provision for income taxes was partially offset by the impact of a higher proportion of income before taxes in 2016 being attributable to non-U.S. jurisdictions, particularly in Europe, where the statutory income tax rates are lower than the U.S. statutory income tax rate.
Additionally, this increase in the provision for income taxes in 2016 was offset by a net reduction of losses generated within companies which are not anticipated to provide a tax benefit to the Company in the future.  These losses are primarily generated within our holding companies incorporated in Luxembourg and our former primary operating company incorporated in Brazil. For the year ended December 31, 2016, these losses totaled approximately $65.1 million and included an impairment charge of $15.1 million for the estimated loss on the sale of Trinseo Brazil. Refer to Note 3 in the consolidated financial statements for further information.
For the year ended December 31, 2015, these losses totaled approximately $84.7 million and included payments made in our Luxembourg entities of $19.0 million related to a portion of the fees associated with the call premium paid to retire the Company’s 2019 Senior Notes and $5.6 million related to the write off of the related unamortized deferred financing fees (refer to Note 10 in the consolidated financial statements for further information). Also included in these losses was non-deductible interest of $28.1 million and stock-based compensation expense.
In addition, for the year ended December 31, 2015, the provision for income taxes was unfavorably impacted by the recognition of a valuation allowance of $7.3 million on the net deferred tax asset of one of our China subsidiaries during the fourth quarter, as this entity was in a three year cumulative loss position as of December 31, 2015.
Selected Segment Information
The Company’s reportable segments are as follows: Latex Binders, Synthetic Rubber, Performance Plastics, Basic Plastics, Feedstocks, and Americas Styrenics. Refer to Item 1— Business for a description of our segments, including a detailed overview, products and end uses, and competition and customers.
The following sections describe net sales, Adjusted EBITDA, and Adjusted EBITDA margin by segment for the years ended December 31, 2017, 2016, and 2015. Inter-segment sales have been eliminated. Refer to Note 18 in the consolidated financial statements for a detailed definition of Adjusted EBITDA and a reconciliation of income before income taxes to segment Adjusted EBITDA.
References to portfolio adjustments below represent the impacts of the Company’s acquisition and divestiture activity, including the acquisition of API Plastics and the sale of our joint venture Sumika Styron Polycarbonate during 2017, as well as the sale of our business in Brazil during 2016. Refer to the consolidated financial statements for further information.
 
Latex Binders Segment

 	 	Year Ended 	 	 	 	 	 	 	 	
 	 	December 31,	 	 	Percentage Change	 	 	 	 	
($ in millions)	    	2017	 	    	2016	 	    	2015	 	    	2017 vs. 2016	 	2016 vs. 2015	 	 	 	 	
Net sales	 	$	1,097.1	 	    	$	925.3	 	    	$	966.2	 	    	19	%  	(4)	%  	 	 	 	
Adjusted EBITDA	 	$	138.5	 	 	$	94.3	 	 	$	79.0	 	 	47	%  	19	%  	 	 	 	
Adjusted EBITDA margin	 	 	13	%  	 	 	10	%  	 	 	 8	%  	 	 	 	 	 	 	 	 	
2017 vs. 2016
Of the 19% increase in net sales, 25% was due to higher selling prices, primarily due to the pass through of higher butadiene and styrene costs to our customers. Offsetting this increase was a 4% decrease due to lower sales volume and a 3% decrease due to portfolio adjustments.
Full year Adjusted EBITDA was a record $138.5 million, noting stronger results from the Company’s diversified chemistries and cost actions, as well as improved market conditions in Asia. Specifically, Adjusted EBITDA increased by $44.2 million, or 47%, year-over-year primarily due to margin improvements resulting from favorable market conditions, particularly in Asia, which resulted in a 65% increase. Partially offsetting these margin improvements was a

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14% decrease due to lower sales volume, primarily within the North America and European paper and carpet markets. Portfolio adjustments resulted in a 3% decrease to Adjusted EBITDA.
2016 vs. 2015
The 4% decrease in net sales was due to lower selling prices, primarily due to the pass through of lower butadiene and styrene costs to our customers.
The increase in Adjusted EBITDA was primarily due to margin improvements of $12.2 million during the period, noting price increases in North America and freight and utility savings, particularly in Asia. Additionally, fixed cost improvements contributed to 3% of the increase, which includes the impact of the sale of our business in Brazil. Refer to Note 3 in the consolidated financial statements for further information.
Synthetic Rubber Segment

 	 	Year Ended 	 	 	 	 	 	 	 	
 	 	December 31,	 	 	Percentage Change	 	 	 	 	
($ in millions)	    	2017	 	    	2016	 	    	2015	 	    	2017 vs. 2016	 	2016 vs. 2015	 	 	 	 	
Net sales	 	$	582.8	 	    	$	450.7	 	    	$	474.6	 	    	29	%  	(5)	%  	 	 	 	
Adjusted EBITDA	 	$	83.3	 	 	$	110.9	 	 	$	93.0	 	 	(25)	%  	19	%  	 	 	 	
Adjusted EBITDA margin	 	 	14	%  	 	 	25	%  	 	 	20	%  	 	 	 	 	 	 	 	 	
2017 vs. 2016
Net sales increased 29% from the prior year, with higher selling prices contributing to 25% of the increase, primarily resulting from the pass through of higher butadiene and styrene costs to customers. Additionally, 3% of the increase was due to record sales volume which was a result of higher customer demand for SSBR, as well as higher sales of Ni-PBR.
The majority of the overall $27.6 million decrease in Adjusted EBITDA was primarily due to unfavorable raw material timing resulting from a favorable impact in the prior period compared to an unfavorable impact in the current period, which resulted in a 15% decrease due to lower margins. Higher fixed costs as well as sales volume mix resulted in a 10% decrease primarily from growth initiatives, including our SSBR capacity expansion and SSBR pilot plant development.
2016 vs. 2015
Of the 5% decrease in net sales, 5% was due to lower selling prices, primarily resulting from the pass through of lower butadiene and styrene costs to customers, and 1% of the decrease was due to an unfavorable currency impact as the euro weakened in comparison to the U.S. dollar. Partially offsetting these decreases was a 1% increase due to increased sales volume, as higher customer demand for SSBR and other products was partially offset by lower sales of Ni-PBR, as production decreased due to Nd-PBR plant trials.
The increase in Adjusted EBITDA was primarily due to improved fixed costs, which resulted in 11% of the increase, as the prior year included lower fixed cost absorption and higher maintenance costs due primarily to a planned turnaround. Additionally, improved margins contributed to 3% of the increase and higher sales volume contributed to 5% of the increase, which was primarily related to higher demand and availability of SSBR.
Performance Plastics Segment  

 	 	Year Ended 	 	 	 	 	 	 	 	
 	 	December 31,	 	 	Percentage Change	 	 	 	 	
($ in millions)	    	2017	 	    	2016	 	    	2015	 	    	2017 vs. 2016	 	2016 vs. 2015	 	 	 	 	
Net sales	 	$	808.3	 	    	$	693.4	 	    	$	742.8	 	    	17	%  	(7)	%  	 	 	 	
Adjusted EBITDA	 	$	122.4	 	 	$	136.2	 	 	$	107.6	 	 	(10)	%  	27	%  	 	 	 	
Adjusted EBITDA margin	 	 	15	%  	 	 	20	%  	 	 	14	%  	 	 	 	 	 	 	 	 	

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2017 vs. 2016
Of the 17% increase in net sales, 9% was due to record sales volume in 2017, primarily related to higher sales to the automotive markets in all regions and in the consumer electronics market in Asia. In addition, a 6% increase was due to higher selling prices primarily due to the pass through of higher raw material costs to our customers.
The overall decrease in Adjusted EBITDA of $13.8 million was the result of several factors. Unfavorable raw material timing led to lower margins for the period. In addition, the Company experienced margin compression, especially in the first half of the year, from increased costs of raw materials, not all of which were able to be passed through to our customers. These two factors contributed to a combined 28% decrease in Adjusted EBITDA due to lower margins compared to the prior year. The Company did note improved margins in the second half of the year, as raw material volatility subsided, along with our implementation of certain pricing initiatives. Additionally, increased fixed costs contributed to a 3% decrease in Adjusted EBITDA.
Partially offsetting these decreases was a 17% increase in Adjusted EBITDA due to record full year sales volume, noting growth to the automotive markets in all regions and in the consumer electronics market in Asia, and a 3% increase due to portfolio adjustments.
2016 vs. 2015
Of the 7% decrease in net sales, 4% was due to lower selling prices, primarily related to the pass through of lower raw material costs to our customers, and 3% was due to decreased sales volume, due to lower sales to the consumer electronics market in Asia.
The increase in Adjusted EBITDA was primarily due to a 25% increase due to higher margins, including favorable raw material timing, and a 6% increase due to improved fixed costs, which includes the impact of the sale of our business in Brazil (refer to Note 3 in the consolidated financial statements for further information). These increases were partially offset by a 5% decrease from lower sales volume, primarily caused by lower sales to the consumer electronics market in Asia, which were partially offset by higher sales to the automotive market.
Basic Plastics Segment

 	 	Year Ended 	 	 	 	 	 	 	 	
 	 	December 31,	 	 	Percentage Change	 	 	 	 	
($ in millions)	    	2017	 	    	2016	 	    	2015	 	    	2017 vs. 2016	 	2016 vs. 2015	 	 	 	 	
Net sales	 	$	1,552.2	 	    	$	1,352.7	 	    	$	1,478.1	 	    	15	%  	(8)	%  	 	 	 	
Adjusted EBITDA	 	$	156.7	 	 	$	148.2	 	 	$	115.6	 	 	 6	%  	28	%  	 	 	 	
Adjusted EBITDA margin	 	 	10	%  	 	 	11	%  	 	 	 8	%  	 	 	 	 	 	 	 	 	
2017 vs. 2016
Of the 15% increase in net sales, 15% was due to higher selling prices due to the pass through of higher styrene costs to customers, partially offset by a 2% decrease due to lower sales volume, primarily related to lower polystyrene sales in Asia, as we have increased our focus on higher margin business.
Full year Adjusted EBITDA was a record $156.7 million, noting favorable market dynamics across our polystyrene, polycarbonate, and ABS product lines, and strong year-over-year profitability, despite an $8.0 million reduction in Adjusted EBITDA due to the sale of Sumika Styron Polycarbonate during the first quarter of 2017.
Specifically, Adjusted EBITDA increased 6%, or $8.5 million, of which 20% was due to higher margins, primarily within ABS and polycarbonate. Partially offsetting this increase was a 6% decrease due to increased fixed costs, which includes start-up costs incurred related to our new ABS capacity in Asia. Lower sales volume resulted in a 2% decrease, primarily related to Asia polystyrene sales, with an increased focus on higher margins in Asia. Portfolio adjustments resulted in a 5% decrease in Adjusted EBITDA, which includes the impact of the sale of Sumika Styron Polycarbonate mentioned above.

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2016 vs. 2015
Of the 8% decrease in net sales, 6% was due to lower selling prices from the pass through of lower styrene costs to customers, and 2% of the decrease was due to lower sales volume, primarily related to lower polystyrene sales in Europe and Asia.
The increase in Adjusted EBITDA was primarily due to a 28% increase from higher margins in styrenic polymers and PC, and a 4% increase from equity earnings from our joint venture, Sumika Styron Polycarbonate, noting improved PC market conditions as well as favorable raw material timing. Partially offsetting these increases was a 4% decrease due to lower sales volume, primarily related to Europe and Asia polystyrene sales.
Feedstocks Segment

 	 	Year Ended 	 	 	 	 	 	 	 	
 	 	December 31,	 	 	Percentage Change	 	 	 	 	
($ in millions)	    	2017	 	    	2016	 	    	2015	 	    	2017 vs. 2016	 	2016 vs. 2015	 	 	 	 	
Net sales	 	$	407.7	 	    	$	294.5	 	    	$	310.2	 	    	38	%  	(5)	%  	 	 	 	
Adjusted EBITDA	 	$	110.5	 	 	$	80.2	 	 	$	51.3	 	 	38	%  	56	%  	 	 	 	
Adjusted EBITDA margin	 	 	27	%  	 	 	27	%  	 	 	17	%  	 	 	 	 	 	 	 	 	
2017 vs. 2016
The 38% increase in net sales was mainly due to the pass through of higher styrene prices, which contributed to 27% of the increase. Higher styrene-related sales volume also resulted in a 10% increase in net sales.
The increase in Adjusted EBITDA was primarily due to higher margins as a result of favorable market conditions, which resulted in a 44% increase in Adjusted EBITDA, slightly offset by a 7% decrease due to higher maintenance-related fixed costs.
2016 vs. 2015
The 5% decrease in net sales was due to lower selling prices, resulting from the pass through of lower styrene costs to customers.
The increase in Adjusted EBITDA was due to a 50% increase resulting from higher margins in styrene, as well as a 6% increase due to improved fixed costs.
Americas Styrenics Segment

 	 	Year Ended 	 	 	 	 	 	 	 	
 	 	December 31,	 	 	Percentage Change	 	 	 	 	
($ in millions)	    	2017	 	    	2016	 	    	2015	 	    	2017 vs. 2016	 	2016 vs. 2015	 	 	 	 	
Adjusted EBITDA*	 	$	122.9	 	 	$	135.8	 	 	$	135.3	 	 	(9)	%  	 0	%  	 	 	 	
* The results of this segment are comprised entirely of earnings from Americas Styrenics, our equity method investment. As such, Adjusted EBITDA related to this segment is included within “Equity in earnings of unconsolidated affiliates” in the consolidated statements of operations.
2017 vs. 2016
The decrease in Adjusted EBITDA was primarily due to the planned first quarter of 2017 styrene outage at the Americas Styrenics St. James, LA facility, which was extended in order to complete repairs on critical equipment. The facility came back online at full production in early April 2017. As a result of this extended outage, the Company incurred an unfavorable impact of approximately $23 million to Adjusted EBITDA, of which approximately $15 million was related to lost production margin and the remaining was related to sales of excess spot styrene following the outage.

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Partially offsetting the impact of this outage was an increase in Adjusted EBITDA due to higher styrene sales volume, including impacts from a stronger export market.
2016 vs. 2015
The slight increase in Adjusted EBITDA was due to increased equity earnings from our styrenics joint venture Americas Styrenics, as higher styrene margins and polystyrene volume were offset by lower polystyrene margins and the impacts of the second quarter planned styrene production outage.
Outlook
We expect strong performance for the Company in the first quarter of 2018 due to higher styrene margins, including impacts from planned and unplanned styrene production outages, as well as continued, healthy fundamentals across our segments. For full year 2018, we also expect continued strength in business fundamentals and higher overall profitability, noting significant contributions from our growth initiatives as well as favorable impacts from unplanned styrene outages in the first quarter. In addition, we expect continued strong cash generation for the year.
Additionally, effective for the first quarter of 2018, the Company realigned our reporting segments to reflect the new model under which the business will be managed and results will be reviewed by the chief executive officer, who is the Company’s chief operating decision maker. Under this new segmentation, we will continue to report operating results for six segments, four of which will remain unchanged from the Company’s current segmentation: Latex Binders, Synthetic Rubber, Feedstocks, and Americas Styrenics. The results of our Polystyrene business, which is currently included within the results of the Basic Plastics segment, will now be reported as a standalone segment. Performance Plastics, which previously consisted of compounds, blends, and ABS products sold to the automotive market, will now also include the remaining portion of our ABS business, as well as the results of our SAN and polycarbonate businesses. This segmentation change will provide enhanced clarity to investors by concentrating the Company’s more specialized plastics into a single reporting segment, while also reducing complexity as polycarbonate and ABS are the primary inputs into the downstream production of our compounds and blends. The Company’s quarterly report on Form 10-Q for the quarter ended March 31, 2018 will be presented under this new segmentation.
Non-GAAP Performance Measures
We present Adjusted EBITDA as a non-GAAP financial performance measure, which we define as income from continuing operations before interest expense, net; provision for income taxes; depreciation and amortization expense; loss on extinguishment of long-term debt; asset impairment charges; gains or losses on the dispositions of businesses and assets; restructuring; acquisition related costs and other items. In doing so, we are providing management, investors, and credit rating agencies with an indicator of our ongoing performance and business trends, removing the impact of transactions and events that we would not consider a part of our core operations.
There are limitations to using the financial performance measures such as Adjusted EBITDA. This performance measure is not intended to represent net income or other measures of financial performance. As such, it should not be used as an alternative to net income as an indicator of operating performance. Other companies in our industry may define Adjusted EBITDA differently than we do. As a result, it may be difficult to use this or similarly-named financial measures that other companies may use, to compare the performance of those companies to our performance. We compensate for these limitations by providing a reconciliation of this performance measure to our net income, which is determined in accordance with GAAP.  

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Adjusted EBITDA is calculated as follows for the years ended December 31, 2017, 2016, and 2015, respectively:

 	 	Year Ended	 	
 	 	December 31, 	 	
(In millions)	 	2017	    	2016	 	2015	  	
Net income	 	$	328.3	    	$	318.3	 	$	133.6	 	
Interest expense, net	 	 	70.1	 	 	75.0	 	 	93.2	 	
Provision for income taxes	 	 	82.8	 	 	87.0	 	 	70.2	 	
Depreciation and amortization	 	 	110.6	 	 	96.4	 	 	96.8	 	
EBITDA (a)	 	$	591.8	 	$	576.7	 	$	393.8	 	
Loss on extinguishment of long-term debt	 	 	65.3	 	 	 —	 	 	95.2	 	
Net loss (gain) on disposition of businesses and assets (b)	 	 	(9.7)	 	 	15.1	 	 	 —	 	
Restructuring and other charges (c)	 	 	6.0	 	 	23.5	 	 	0.8	 	
Acquisition transaction and integration costs (d)	 	 	4.7	 	 	 —	 	 	 —	 	
Asset impairment charges or write-offs (e)	 	 	4.3	 	 	 —	 	 	 —	 	
Other items (f)	 	 	(19.9)	 	 	(4.4)	 	 	2.2	 	
Adjusted EBITDA	 	$	642.5	 	$	610.9	 	$	492.0	 	

	(a)		EBITDA is a non-GAAP financial performance measure that we refer to in making operating decisions because we believe it provides our management as well as our investors and credit agencies with meaningful information regarding the Company’s operational performance. We believe the use of EBITDA as a metric assists our board of directors, management and investors in comparing our operating performance on a consistent basis. Other companies in our industry may define EBITDA differently than we do. As a result, it may be difficult to use EBITDA, or similarly-named financial measures that other companies may use, to compare the performance of those companies to our performance. We compensate for these limitations by providing reconciliations of our EBITDA results to our net income, which is determined in accordance with GAAP.	
	(b)		Net gain on disposition of businesses and assets during the year ended December 31, 2017 relates primarily to the sale of our 50% share in Sumika Styron Polycarbonate to Sumitomo Chemical Company Limited, for which the Company recorded a gain on sale of $9.3 million during the period. During the year ended December 31, 2016, the Company recorded impairment charges for the loss on sale of our primary operating entity in Brazil, which includes both latex binders and automotive businesses. Refer to Note 4 and Note 3, respectively, in the consolidated financial statements for further information .	
	(c)		Restructuring and other charges for the year ended December 31, 2017 relate to employee termination benefit and decommissioning charges incurred in connection with the decision to cease manufacturing activities at our latex binders manufacturing facility in Livorno, Italy, as well as employee termination benefit charges and contract termination charges related to the upgrade and replacement of the Company’s compounding facility in Terneuzen, The Netherlands. Restructuring and other charges for the year ended December 31, 2016 relate primarily to approximately $20.0 million in charges incurred in connection with the Livorno, Italy action discussed above. The remaining restructuring charges for 2016 relate to the Company’s decision to divest our operations in Brazil as well as the closure of our Allyn’s Point latex binders manufacturing facility. Restructuring and other charges for the year ended December 31, 2015 relate primarily to the polycarbonate restructuring within our Basic Plastics segment and employee termination benefit charges incurred in connection with the Allyn’s Point shutdown discussed above. Refer to Note 19 in the consolidated financial statements for further information regarding restructuring activities.	
Note that the accelerated depreciation charges incurred as part of both the upgrade and replacement of the Company’s compounding facility in Terneuzen, The Netherlands as well as the Allyn’s Point shutdown are included within the “Depreciation and amortization” caption above, and therefore are not included as a separate adjustment within this caption.
	(d)		Acquisition transaction and integration costs for the year ended December 31, 2017 relate to advisory and professional fees and a non-cash fair value inventory adjustment incurred in conjunction with the Company’s acquisition of API Plastics, which closed in July 2017. Refer to Note 3 in the consolidated financial statements for further information.	

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	(e)		Asset impairment charges for the year ended December 31, 2017 relate to the impairment of certain long-lived assets within the Company’s Performance Plastics segment.	
	(f)		Other items for the year ended December 31, 2017 primarily relate to a curtailment gain recorded on certain of the Company’s pension plans in Europe, offset by fees incurred in conjunction with the Company’s debt refinancing which was completed during the third quarter of 2017. Other items for the year ended December 31, 2016 include other income of $6.9 million from the effective settlement of certain value-added tax positions, offset by $2.5 million of fees incurred in conjunction with the Company’s secondary offerings completed during the year. Other items incurred for the year ended December 31, 2015 primarily consist of costs related to the process of changing our corporate name from Styron to Trinseo.	
Liquidity and Capital Resources
Cash Flows
The table below summarizes our primary sources and uses of cash for the years ended December 31, 2017, 2016, and 2015. We have derived the summarized cash flow information from our audited financial statements. The tables and discussions below have been recast as a result of our adoption of new cash flow guidance effective September 30, 2017 which was applied retrospectively. Refer to Note 2 of the consolidated financial statements for further information regarding this adoption.

 	 	Year Ended	 	
 	 	December 31, 	 	
(In millions)	    	2017	    	2016	    	2015	 	
Net cash provided by (used in):	 	 	 	 	 	 	 	 	 	 	
Operating activities	 	$	391.3	 	$	403.7	 	$	421.9	 	
Investing activities	 	 	(182.6)	 	 	(117.3)	 	 	(106.7)	 	
Financing activities	 	 	(253.0)	 	 	(247.6)	 	 	(94.8)	 	
Effect of exchange rates on cash	 	 	12.0	 	 	(5.0)	 	 	(9.9)	 	
Net change in cash and cash equivalents	 	$	(32.3)	 	$	33.8	 	$	210.5	 	
Operating Activities
Net cash provided by operating activities during the year ended December 31, 2017 totaled $391.3 million, inclusive of $120.0 million in dividends from Americas Styrenics, as well as dividends from Sumika Styron Polycarbonate, $8.9 million of which were classified as operating activities, with the remaining $0.9 million classified as investing activities. Refer to Note 4 in the consolidated financial statements for further information. Net cash used in operating assets and liabilities for the year ended December 31, 2017 totaled $126.7 million, noting increases in accounts receivable of $51.8 million and inventories of $80.2 million, respectively. The increase in accounts receivable was primarily due to the pass through of increased raw material prices to our customers while the increase in inventories was primarily a result of building inventories in advance of certain growth initiatives.
Net cash provided by operating activities during the year ended December 31, 2016 totaled $403.7 million, driven primarily due to improved net income for the period. Also impacting cash flow from operating activities for the period was $130.0 million in dividends from Americas Styrenics.  Net cash used in operating assets and liabilities for the year ended December 31, 2016 totaled $69.8 million, noting increases in accounts receivable of $96.4 million and inventories of $51.0 million, respectively, offset by an increase in accounts payable and other current liabilities of $57.1 million. The increase in accounts receivable was primarily due to higher sales and lower collections, due to timing, during the fourth quarter of 2016 compared to the same period in 2015. The increase in inventory was primarily due to increases in raw material prices in the fourth quarter of 2016 as compared to the same period in 2015. The increase in accounts payable and other current liabilities was primarily due to increases in raw material prices, as noted above, as well as timing of vendor payments.
Net cash provided by operating activities during the year ended December 31, 2015 totaled $421.9 million, primarily due to earnings for the period. Also impacting our cash from operating activities for the period was $125.0 million in dividends from Americas Styrenics. These increases were noted despite significant decreases to operating cash

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flows, including $81.7 million in interest payments made on our 2019 Senior Notes prior to their May 2015 retirement. Net cash provided by operating assets and liabilities for the year ended December 31, 2015 totaled $103.9 million, the most significant components of which were decreases in inventories of $97.2 million and decreases in accounts receivable of $65.1 million, offset by a decrease in accounts payable and other current liabilities of $71.9 million. Inventory decreased due to higher volume sold during the fourth quarter of 2015 when compared to the fourth quarter of 2014, as well as significant decreases in raw materials prices when comparing the periods. The decrease in accounts receivable is primarily due to lower sales and higher collections during the fourth quarter of 2015, compared to the fourth quarter of 2014, primarily due to decreasing raw material prices. The decrease in accounts payable and other current liabilities is primarily due to timing of payments as well as decreases in prices for raw materials purchases.
Investing Activities
Net cash used in investing activities for the year ended December 31, 2017 totaled $182.6 million, resulting from capital expenditures of $147.4 million and cash paid to acquire API Plastics of $82.3 million during the period, net of cash acquired (refer to Note 3 in the consolidated financial statements for further information). Offsetting these uses of cash was an increase from proceeds received of $42.1 million from the sale of Sumika Styron Polycarbonate during the year.
Net cash used in investing activities for the year ended December 31, 2016 totaled $117.3 million, resulting from capital expenditures of $123.9 million during the period, a significant portion of which related to our project to upgrade our legacy ERP environment to the latest version of SAP. Partially offsetting these capital expenditures were $1.8 million in proceeds received from the sale of our businesses in Brazil and dividends received from Sumika Styron Polycarbonate during the period, $4.8 million of which were classified as investing activities in the consolidated statement of cash flows, with the remaining $1.4 million classified as operating activities.
Net cash used in investing activities for the year ended December 31, 2015 totaled $106.7 million, consisting primarily of capital expenditures of $107.1 million during the period, net of proceeds received from a government subsidy of $2.2 million related to our capital expansion project at our rubber facility in Schkopau, Germany.
Financing Activities
Net cash used in financing activities during the year ended December 31, 2017 totaled $253.0 million. The most significant activity during the period related to the third quarter debt refinancing, which included net proceeds of $1,200.0 million from the issuance of our 2024 Term Loan B and our 2025 Senior Notes, offset by the retirement of our existing 2021 Term Loan B and 2022 Senior Notes totaling $1,238.5 million and deferred financing fees paid in conjunction with the refinancing of $21.5 million. The Company also paid a call premium of $53.0 million in conjunction with the redemption of the 2022 Senior Notes. In addition, we paid $88.9 million related to the repurchase of ordinary shares as well as $58.0 million of dividends. Partially offsetting these uses of cash was $9.3 million of proceeds received from the exercise of option awards.
Net cash used in financing activities during the year ended December 31, 2016 totaled $247.6 million. This activity was primarily from $215.1 million of payments related to the repurchase of ordinary shares during the period and $27.3 million of dividends paid, as well as $5.0 million of principal payments related to our 2021 Term Loan B.
Net cash used in financing activities during the year ended December 31, 2015 totaled $94.8 million. The most significant activity during the period related to the May 2015 debt refinancing, which included net proceeds of $1,215.4 million from the issuance of our 2021 Term Loan B and our 2022 Senior Notes, offset by the retirement of our existing 2019 Senior Notes totaling $1,192.5 million and deferred financing fees paid in conjunction with the refinancing of $28.2 million. Additionally, the Company paid a call premium of $68.6 million related to the retirement of the 2019 Senior Notes. During the period, we had net repayments of short-term borrowings of $18.4 million, which largely consisted of borrowings under our short-term revolving credit facility through our subsidiary in China. On a limited basis, we continued to utilize our Accounts Receivable Securitization Facility to fund our working capital requirements, with borrowings from and repayments of our Accounts Receivable Securitization Facility totaling $25.0 million during the period.

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Free Cash Flow
We use Free Cash Flow as a non-GAAP measure to evaluate and discuss the Company’s liquidity position and results. Free Cash Flow is defined as cash from operating activities, less capital expenditures. We believe that Free Cash Flow provides an indicator of the Company’s ongoing ability to generate cash through core operations, as it excludes the cash impacts of various financing transactions as well as cash flows from business combinations that are not considered organic in nature. We also believe that Free Cash Flow provides management and investors with a useful analytical indicator of our ability to service our indebtedness, pay dividends (when declared), and meet our ongoing cash obligations.
Free Cash Flow is not intended to represent cash flows from operations as defined by GAAP, and therefore, should not be used as an alternative for that measure. Other companies in our industry may define Free Cash Flow differently than we do. As a result, it may be difficult to use this or similarly-named financial measures that other companies may use, to compare the liquidity and cash generation of those companies to our own. We compensate for these limitations by providing a reconciliation to cash provided by operating activities, which is determined in accordance with GAAP.
Prior period information below has been recast from its previous presentation to reflect the Company’s current method for calculating Free Cash Flow. Prior to the third quarter of 2016, we calculated Free Cash Flow as cash from both operating and investing activities less the impact of changes in restricted cash. The Company believes our revised method is more aligned to investors’ common understanding of Free Cash Flow and allows for easier comparisons between the Company and its peers. Additionally, the Company has not reported material restricted cash balances since 2012 and is not expected to do so under its current practices.

 	 	Year Ended	 	
 	 	December 31, 	 	
(In millions)	    	2017	    	2016	    	2015	 	
Cash provided by operating activities	 	$	391.3	 	$	403.7	 	$	421.9	 	
Capital expenditures	 	 	(147.4)	 	 	(123.9)	 	 	(109.3)	 	
Free Cash Flow	 	$	243.9	 	$	279.8	 	$	312.6	 	
Refer to the discussion above for significant impacts to cash provided by operating activities for the years ended December 31, 2017, 2016, and 2015, respectively.  
 
Capital Resources, Indebtedness and Liquidity
We require cash principally for day-to-day operations, to finance capital investments and other initiatives, to purchase materials, to service our outstanding indebtedness, and to fund dividend payments to our shareholders. Our sources of liquidity include cash on hand, cash flow from operations, and amounts available under the Senior Credit Facility and the Accounts Receivable Securitization Facility (discussed further below).  
As of December 31, 2017 and 2016, we had $1,199.7 million and $1,187.4 million, respectively, in outstanding indebtedness and $1,019.6 million and $890.7 million, respectively, in working capital. In addition, as of December 31, 2017 and 2016, we had $128.3 million and $88.8 million, respectively, of foreign cash and cash equivalents on our consolidated balance sheets, outside of our country of domicile of Luxembourg, all of which is readily convertible into other foreign currencies, including the U.S. dollar. Our intention is not to permanently reinvest our foreign cash and cash equivalents. Accordingly, we record deferred income tax liabilities related to the unremitted earnings of our subsidiaries.
As noted in Note 10 of the consolidated financial statements, the Company completed a debt refinancing during the third quarter of 2017, the results of which are reflected in the table below. For a detailed description of the Company’s debt structure, borrowing rates, and expected future payment obligations, refer to Note 10 in the consolidated financial statements.
The following table outlines our outstanding indebtedness as of December 31, 2017 and 2016 and the associated interest expense, including amortization of deferred financing fees and debt discounts. Effective interest rates for the

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borrowings included in the table below exclude the impact of deferred financing fee amortization and certain other fees charged to interest expense (such as fees for unused commitment fees during the period).

 	 	As of and for the Year Ended	 	As of and for the Year Ended	 	
 	 	December 31, 2017	 	December 31, 2016	 	
 	 	 	 	Effective	 	 	 	 	 	Effective	 	 	 	
 	 	 	 	Interest	 	Interest	 	 	 	Interest	 	Interest	 	
($ in millions)	    	Balance	    	Rate	    	Expense	    	Balance	 	Rate	    	Expense	 	
Senior Credit Facility	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
2024 Term Loan B	 	$	698.3	 	3.9	%  	$	9.6	 	$	 —	 	 —	 	$	 —	 	
2022 Revolving Facility	 	 	 —	 	 —	 	 	1.0	 	 	 —	 	 —	 	 	 —	 	
2020 Senior Credit Facility	 	 	 	 	 	 	 	 	 	 	    	 	    	 	 	    	 	
2021 Term Loan B	 	 	 —	 	4.3	%  	 	15.9	 	 	491.5	 	4.3	%  	 	23.3	 	
2020 Revolving Facility	 	 	 —	 	 —	 	 	2.3	 	 	 —	 	 —	 	 	3.3	 	
2025 Senior Notes	 	 	500.0	 	5.4	%  	 	9.4	 	 	 —	 	 —	 	 	 —	 	
2022 Senior Notes	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
USD Notes	 	 	 —	 	6.8	%  	 	14.4	 	 	300.0	 	6.8	%  	 	21.1	 	
Euro Notes	 	 	 —	 	6.4	%  	 	18.8	 	 	394.3	 	6.4	%  	 	27.4	 	
Accounts Receivable Securitization Facility	 	 	 —	 	 —	 	 	2.8	 	 	 —	 	 —	 	 	3.3	 	
Other indebtedness	 	 	1.4	 	4.8	%  	 	0.1	 	 	1.6	 	4.8	%  	 	0.1	 	
Total	 	$	1,199.7	 	 	 	$	74.3	 	$	1,187.4	 	 	 	$	78.5	 	
Our Senior Credit Facility includes the 2022 Revolving Facility, which matures in September 2022, and has a borrowing capacity of $375.0 million. As of December 31, 2017, the Company had no outstanding borrowings, and had $360.2 million (net of $14.8 million outstanding letters of credit) of funds available for borrowing under this facility. Further, as of December 31, 2017, the Company is required to pay a quarterly commitment fee in respect of any unused commitments under the 2022 Revolving Facility equal to 0.375% per annum.
Also included in our Senior Credit Facility is our 2024 Term Loan B (with original principal of $700.0 million, maturing in September 2024), which requires scheduled quarterly payments in amounts equal to 0.25% of the original principal. During the year ended December 31, 2017, the Company made principal payments of $1.8 million on the 2024 Term Loan B, with an additional $7.0 million of scheduled future payments classified as current debt on the Company’s consolidated balance sheet as of December 31, 2017.
Our 2025 Senior Notes, as issued under the Indenture, include $500.0 million aggregate principal amount of 5.375% senior notes that mature on September 1, 2025. Interest on the 2025 Senior Notes is payable semi-annually on May 3 and November 3 of each year, commencing on May 3, 2018. These notes may be redeemed prior to their maturity at the option of the Company under certain circumstances at specific redemption prices. Refer to Note 10 in the consolidated financial statements for further information.
We also continue to maintain our Accounts Receivable Securitization Facility, as amended during the fourth quarter of 2017, which matures in May 2019 and contains a borrowing capacity is $150.0 million. As of December 31, 2017, there were no amounts outstanding under this facility, with approximately $122.1 million of funds available for borrowing, based on the pool of eligible accounts receivable.
The Senior Credit Facility and Indenture contain certain customary affirmative, negative and financial covenants. As of December 31, 2017, the Company was in compliance with all of these debt covenant requirements. Refer to Note 10 in the consolidated financial statements for further information on the details of these covenant requirements.
Our ability to raise additional financing and our borrowing costs may be impacted by short- and long-term debt ratings assigned by independent rating agencies, which are based, in significant part, on our performance as measured by certain credit metrics such as interest coverage and leverage ratios.
We and our subsidiaries, affiliates or significant direct or indirect shareholders may from time to time seek to retire or purchase our outstanding debt through cash purchases in the open market, privately negotiated transactions, exchange transactions or otherwise. Such repurchases or exchanges, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors. The amounts involved may be material.

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Trinseo Materials Operating S.C.A. and Trinseo Materials Finance, Inc. (the Issuers of our 2025 Senior Notes and Borrowers under our Senior Credit Facility) are dependent upon the cash generation and receipt of distributions and dividends or other payments from our subsidiaries and joint ventures in order to satisfy their debt obligations. There are no known significant restrictions by third parties on the ability of subsidiaries of the Company to disburse or dividend funds to the Issuers and the Borrowers in order to satisfy these obligations. However, as the Company’s subsidiaries are located in a variety of jurisdictions, the Company can give no assurances that our subsidiaries will not face transfer restrictions in the future due to regulatory or other reasons beyond our control.
The Senior Credit Facility and Indenture also limit the ability of the Borrowers and Issuers, respectively, to pay dividends or make other distributions to Trinseo S.A., which could then be used to make distributions to shareholders. During the year ended December 31, 2017, the Company declared total dividends of $1.38 per ordinary share (totaling $61.6 million), of which $16.9 million remains accrued as of December 31, 2017, and the majority of which will be paid in January 2018. These dividends are well within the available capacity under the terms of the restrictive covenants contained in the Senior Credit Facility and Indenture. Further, significant additional capacity continues to be available under the terms of these covenants to support expected future dividends to shareholders, should the Company continue to declare them.
The Company’s cash flow generation from operations continues to be strong (see discussion above). We believe that funds provided by operations, our existing cash and cash equivalent balances, and borrowings available under our 2022 Revolving Facility and our Accounts Receivable Securitization Facility will be adequate to meet planned operating and capital expenditures for at least the next 12 months under current operating conditions. Nevertheless, our ability to generate future cash and to pay our indebtedness and fund other liquidation needs is subject to certain risks described under Item 1A— Risk Factors . As of December 31, 2017 and 2016, we were in compliance with all the covenants and default provisions under our debt agreements.
Derivative Instruments
The Company’s ongoing global business operations and debt structure expose it to fluctuating foreign exchange rates as well as variability in interest rates. To manage this risk, the Company periodically enters into derivative financial instruments, such as foreign exchange forward contracts and interest rate swap agreements. A brief summary of these derivative financial instrument programs is described below; however, refer to Note 11 of the consolidated financial statements for further information. The Company does not hold or enter into financial instruments for trading or speculative purposes.
Foreign Exchange Forward Contracts
Certain subsidiaries have assets and liabilities denominated in currencies other than their respective functional currencies, which creates foreign exchange risk. Our principal strategy in managing exposure to changes in foreign currency exchange rates is to naturally hedge the foreign currency-denominated liabilities on our consolidated balance sheets against corresponding assets of the same currency such that any changes in liabilities due to fluctuations in exchange rates are offset by changes in their corresponding foreign currency assets. In order to further reduce our exposure, the Company also uses foreign exchange forward contracts to economically hedge the impact of the variability in exchange rates on our assets and liabilities denominated in certain foreign currencies. These derivative contracts are not designated for hedge accounting treatment.
Foreign Exchange Cash Flow Hedges
The Company also enters into forward contracts with the objective of managing the currency risk associated with forecasted U.S. dollar-denominated raw materials purchases by one of our subsidiaries whose functional currency is the euro. By entering into these forward contracts, which are designated as cash flow hedges, the Company buys a designated amount of U.S. dollars and sells euros at the prevailing market rate to mitigate the risk associated with the fluctuations in the euro-to-U.S. dollar foreign currency exchange rates.
Interest Rate Swaps
The Company enters into interest rate swap agreements to manage our exposure to variability in interest payments associated with the Company’s variable rate debt. Under these interest rate swap agreements, which are designated as

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cash flow hedges, the Company is effectively converting a portion of our variable rate borrowings into a fixed rate obligation to mitigate the risk of variability in interest rates.
Net Investment Hedge
As of December 31, 2017, the Company had certain fixed-for-fixed cross currency swaps outstanding, swapping U.S. dollar principal and interest payments on the Company’s 2025 Senior Notes for euro-denominated payments. These cross currency swaps have been designated as a hedge of the Company’s net investment in certain European subsidiaries. As such, changes in their fair value, to the extent effective, are recorded within the cumulative translation adjustment account as a component of accumulated other comprehensive income or loss (“AOCI”).
Contractual Obligations and Commercial Commitments
The following table reflects our contractual obligations as of December 31, 2017. Amounts we pay in future periods may vary from those reflected in the table:

(In millions)	 	Payments due by year	 	
Contractual Obligations as of December 31, 2017	    	2018	    	2019	    	2020	    	2021	    	2022	    	Thereafter	    	Total	 	
Purchase commitments (1)	  	$	1,480.1	  	$	1,007.5	  	$	866.6	  	$	4.8	  	$	 —	  	$	 —	  	$	3,359.0	 	
Long-term Indebtedness (2)	 	 	7.0	 	 	7.0	 	 	7.0	 	 	7.0	 	 	7.0	 	 	1,163.3	 	 	1,198.3	 	
Interest payments on long-term debt (net of interest rate swap effects) (3)	 	 	61.0	 	 	55.8	 	 	55.6	 	 	55.2	 	 	54.8	 	 	122.7	 	 	405.1	 	
Pension and other postretirement benefits (4)	 	 	5.5	 	 	21.2	 	 	6.2	 	 	5.7	 	 	6.5	 	 	50.5	 	 	95.6	 	
Minimum operating lease commitments and other obligations (5)	 	 	13.5	 	 	12.6	 	 	9.4	 	 	10.3	 	 	3.6	 	 	16.2	 	 	65.6	 	
Uncertain tax positions, including interest and penalties (6)	 	 	 —	 	 	 —	 	 	 —	 	 	 —	 	 	 —	 	 	5.7	 	 	5.7	 	
Total	 	$	1,567.1	 	$	1,104.1	 	$	944.8	 	$	83.0	 	$	71.9	 	$	1,358.4	 	$	5,129.3	 	

	(1)		We have certain raw material purchase contracts where we are required to purchase certain minimum volumes at the then prevailing market prices. These commitments range from 1 to 4 years. In certain raw material purchase contracts, we have the right to purchase less than required minimums and pay a liquidated damages fee, or, in case of a permanent plant shutdown, to terminate the contracts. In such cases these obligations would be less than the obligations shown in the table above.	
	(2)		As part of the third quarter of 2017 debt refinancing, we redeemed our existing 2021 Term Loan B and 2022 Senior Notes, replacing those borrowings with a $700.0 million 2024 Term Loan B due September 2024 and $500.0 million 2025 Senior Notes due September 2025. The 2024 Term Loan B requires scheduled quarterly payments in amounts equal to 0.25% of the original principal, or $7.0 million per year. The long-term indebtedness line included in the table above excludes the impacts of certain fixed-for-fixed cross currency swaps (discussed in Note 11 to the consolidated financial statements) as well as all other debt outstanding as of December 31, 2017 totaling $1.4 million.	
	(3)		Interest payments on debt are calculated for future periods using interest rates in effect as of December 31, 2017. The amounts above include estimated interest on the 2024 Term Loan B and the related effects of interest rate swap agreements, as well as interest on the 2025 Senior Notes. This line excludes the impacts of certain fixed-for-fixed cross currency swaps discussed in further detail in Note 11 to the consolidated financial statements. Interest on the 2024 Term Loan B is payable quarterly, while interest on the 2025 Senior Notes is payable semi-annually on May 3 rd and November 3 rd of each year.   Refer to Item 7A— Quantitative and Qualitative Disclosures about Market Risk for further discussion of interest rate and foreign currency risks. Certain of these projected interest payments may differ in the future based on changes in floating interest rates or other factors and events. Estimated interest payments do not include the 2022 Revolving Facility or Accounts Receivable Securitization Facility as amounts	

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outstanding under these facilities vary due to periodic borrowings and repayments. There are no amounts outstanding under either facility as of December 31, 2017.	
	(4)		Includes minimum contributions required to be made to the funded pension plans and expected benefit payments to the employees for unfunded pension plans. With respect to our minimum funding requirements under our pension obligations, we may elect to make contributions in excess of the minimum funding requirements in response to investment performance or changes in interest rates or when we believe that it is financially advantageous to do so and based on our other cash requirements. Our minimum funding requirements after 2017 will depend on several factors, including investment performance and interest rates. Our minimum funding requirements may also be affected by changes in applicable legal requirements. We also have payments due with respect to our postretirement benefit obligations, which we do not fund in advance. Rather, payments are made as costs are incurred by covered retirees. We expect benefit payments related to our postretirement benefit obligations to be $3.2 million through 2027. The payments identified above as subsequent to 2022 represent estimated pension and postretirement payments from 2023 through 2027. Also included in the above is a $16.0 million expected benefit obligation for payments estimated to be payable in 2019 under the Company’s non-qualified supplemental employee retirement plan. Refer to Note 15 in the consolidated financial statements for further information.	
	(5)		Excludes certain estimated future commitments under agreements with Dow, including the SAR MOSA, under which Dow provides administrative and operational services to us, and the 25-year SAR SSAs, under which Dow provides utilities and site services to certain of our facilities co-located with Dow. For more information regarding these agreements, including details regarding the rights of the Company and Dow to terminate said agreements, refer to Item 1— Business— Our Relationship with Dow .  	
As of December 31, 2017, we estimate our minimum obligation under the SAR MOSA to be approximately $16.9 million. Utilizing current year known costs and assuming that we continue with this agreement through its completion on December 31, 2020, we estimate our contractual obligations for the SAR MOSA to be approximately $47.0 million annually for 2018 through 2020.
Additionally, utilizing current year known costs and assuming that we continue with the SAR SSAs, we estimate our contractual obligations under these agreements to be approximately $186.0 million annually for 2018 through 2022, and a total of $2,877.1 million thereafter through June 2038.
Refer to Note 17 in the consolidated financial statements for further information.
	(6)		Due to uncertainties in the timing of the effective settlement of tax positions with the respective taxing authorities, we are unable to determine the timing of payments related to our uncertain tax positions, including interest and penalties. Amounts are therefore reflected in “Thereafter ”.	
Critical Accounting Policies and Estimates
Our discussion and analysis of results of operations and financial condition are based upon our financial statements, which have been prepared in accordance with GAAP. The preparation of these financial statements requires us to make estimates and judgments that affect the amounts reported. We base these estimates and judgments on historical experiences and assumptions believed to be reasonable under the circumstances. Actual results could vary from our estimates under different conditions. Our significant accounting policies, which may be affected by our estimates and assumptions, are more fully described in Note 2 in the consolidated financial statements. An accounting policy is deemed to be critical if it requires an accounting estimate to be made based on assumptions about matters that are highly uncertain at the time the estimate is made, and if different estimates that reasonably could have been used, or changes in the accounting estimates that are reasonably likely to occur periodically, could materially impact the financial statements. The following critical accounting policies reflect our most significant estimates and assumptions used in the preparation of the consolidated financial statements.
Pension Plans and Postretirement Benefits
We have various company-sponsored retirement plans covering substantially all employees. We also provide certain health care and life insurance benefits to retired employees in the United States. Prior to the divestiture of our latex binders and automotive businesses in Brazil in 2016 (refer to Note 3 in the consolidated financial statements), we also provided health care and life insurance benefits to retired employees in Brazil. The U.S.-based plan provides health

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care benefits, including hospital, physicians’ services, drug and major medical expense coverage, and life insurance benefits. We recognize the underfunded or overfunded status of a defined benefit pension or postretirement plan as an asset or liability in our consolidated balance sheets and recognize changes in the funded status in the year in which the changes occur through AOCI, which is a component of shareholders’ equity.
A settlement is a transaction that is an irrevocable action that relieves the employer (or the plan) of primary responsibility for a pension or postretirement benefit obligation, and that eliminates significant risks related to the obligation and the assets used to effect the settlement. The Company does not record settlement gains or losses during interim periods when the cost of all settlements in a year is less than or equal to the sum of the service cost and interest cost components of net periodic pension cost for the plan in that year.
Pension benefits associated with these plans are generally based on each participant’s years of service, compensation, and age at retirement or termination. The discount rate is an important element of expense and liability measurement. We evaluate our assumptions at least once each year, or as facts and circumstances dictate, and make changes as conditions warrant.
We determine the discount rate used to measure plan liabilities as of the December 31 measurement date for the pension and postretirement benefit plans. The discount rate reflects the current rate at which the associated liabilities could be effectively settled at the end of the year. We set our rate to reflect the yield of a portfolio of high quality, fixed-income debt instruments that would produce cash flows sufficient in timing and amount to settle projected future benefits. Using this methodology, we determined a weighted-average discount rate of 1.79% for pension and 3.68% for postretirement benefits to be appropriate as of December 31, 2017.
In 2016, we changed the method used to estimate the future service and interest cost components of net periodic benefit cost for our defined benefit pension and other postretirement benefit plans. Historically, we estimated the future service and interest cost components using a single weighted ‐ average discount rate derived from the yield curve that was used to measure the benefit obligation at the beginning of the period. For 2017 and beyond, we have elected to use a full yield curve approach in the estimation of these components of benefit cost by applying the specific spot rates along the yield curve used in the determination of the benefit obligation to the relevant projected cash flows. We have made this change to improve the correlation between projected benefit cash flows and the corresponding yield curve spot rates and to provide a more precise measurement of service and interest costs. This change did not affect the measurement of our total benefit obligations, as the change in the service cost and interest cost was entirely offset in the actuarial loss reported. We have accounted for this as a change in estimate that was applied prospectively beginning in the first quarter of 2017.
The weighted-average discount rates that we used to measure service cost for pension and postretirement plans during 2017 were 1.64% and 4.18%, respectively. The weighted-average discount rates that we used to measure interest cost for pension and postretirement plans during 2017 were 1.42% and 3.81%, respectively. Had we not changed our estimation approach, we would have utilized the December 31, 2016 liability discount rates of 1.65% for pension and 4.16% for postretirement benefits to determine service and interest cost. The changes to service cost and interest cost for 2017 associated with this change are not material to the consolidated financial statements.
We determine the expected long-term rate of return on assets by performing a detailed analysis of historical and expected returns based on the underlying assets, which generally are insurance contracts. We also consider our historical experience with the pension fund asset performance. The expected return of each asset class is derived from a forecasted future return confirmed by current and historical experience. The weighted-average long-term rate of return assumptions used for determining net periodic pension expense were 1.44% and 1.79% for 2017 and 2016, respectively. The decrease was primarily due to lower interest rates during 2017 on certain assets with guaranteed returns. Future actual pension expense will depend on the performance of the underlying assets and changes in future discount rates, among other factors.
Holding all other factors constant, a 0.25 percentage point increase (decrease) in the discount rate used to determine net periodic cost would decrease (increase) 2018 pension expense by approximately $1.4 million and $(1.2) million, respectively. Holding all other factors constant, a 0.25 percentage point increase (decrease) in the long-term rate of return on assets used to determine net periodic cost would decrease (increase) 2018 pension expense by approximately $0.1 million and $(0.1) million, respectively.

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As noted above, plan assets are invested primarily in insurance contracts that provide for guaranteed returns. As of December 31, 2017 and 2016, respectively, plan assets totaled $140.1 million and $114.2 million. Investments in the pension plan insurance are valued utilizing unobservable inputs, which are contractually determined based on cash surrender values, returns, fees, and the present value of the future cash flows of the contracts, and are classified as Level 3 investments.  
Business Combinations and Asset Impairments
Business Combinations
Acquisitions that qualify as a business combination are accounted for using the purchase accounting method. Amounts paid for an acquisition are allocated to the assets acquired and liabilities assumed based on their fair value as of the date of acquisition. Goodwill is recorded as the difference in the fair value of the acquired assets and liabilities assumed (net assets acquired) and the purchase price. Goodwill is not amortized, but is reviewed for impairment annually as of October 1st, or when events or changes in the business environment indicate that the carrying value of a reporting unit may exceed its fair value. Refer to discussion below for further information regarding asset impairments.
Under the purchase accounting method, the Company completes valuation procedures for an acquisition, often with the assistance of third-party valuation specialists, to determine the fair value of the assets acquired and liabilities assumed. These valuation procedures require management to make assumptions and apply significant judgment to estimate the fair value of the assets acquired and liabilities assumed. If the estimates or assumptions used should significantly change, the resulting differences could materially affect the fair value of net assets.
Specifically, the calculation of the fair value of tangible assets, including property, plant and equipment, utilizes the cost approach, which computes the cost to replace the asset, less accrued depreciation resulting from physical deterioration, and functional and external obsolescence. The calculation of the fair value of identified intangible assets is determined using cash flow models following the income approach. Significant inputs include estimated future cash flows, discount rates, royalty rates, growth rates, sales projections, retention rates, and terminal values, all of which require significant management judgment. Definite-lived intangible assets, which are primarily comprised of developed technology, customer relationships, manufacturing capacity rights, and software, are amortized over their estimated useful lives using the straight-line method and are assessed for impairment whenever events or changes in circumstances indicate the carrying value of the asset may not be recoverable.
Asset Impairments
As of December 31, 2017, net property, plant and equipment, net identifiable finite-lived intangible assets, and goodwill totaled $627.0 million, $207.5 million, and $72.5 million, respectively. Management makes estimates and assumptions in preparing the consolidated financial statements for which actual results will emerge over long periods of time. This includes the recoverability of long-lived assets employed in the business. These estimates and assumptions are closely monitored by management and periodically adjusted as circumstances warrant. For instance, expected asset lives may be shortened or impairment may be recorded based on a change in the expected use of the asset or performance of the related asset group.
We evaluate long-lived assets and identifiable finite-lived intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset or asset grouping may not be recoverable. In the event the carrying value of the asset exceeds its undiscounted future cash flows and the carrying value is not considered recoverable, impairment may exist. An impairment loss, if any, is measured as the excess of the asset’s carrying value over its fair value, generally based on a discounted future cash flow method, independent appraisals, etc.
In August 2016, we announced our plan to cease manufacturing activities at the Company’s latex binders manufacturing facility in Livorno, Italy. As a result, we determined that the long-lived assets at this facility, which included land and depreciable long-lived assets, should be assessed for impairment. This assessment indicated that the carrying value of the asset group was not recoverable when compared to the expected undiscounted cash flows from the operation and eventual disposition of these assets. The fair value of the depreciable assets was determined under the income approach, utilizing a discounted cash flow model. The key assumption in this model was cash flow projections, which were determined to be nil, as the plant ceased manufacturing operations in October 2016. The fair value of the land was determined utilizing a combination of the market and income approaches, utilizing key inputs such as recent comparable market transactions, expected date of sale, and discount rate. Based upon this assessment, for the year ended

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December 31, 2016, we recorded an impairment loss of approximately $13.7 million. The amount was included in “Selling, general and administrative expenses” in the consolidated statement of operations and was allocated entirely to the Latex Binders segment.
Through December 31, 2017, we have continued to assess the recoverability of certain assets, and concluded there are no additional significant events or circumstances identified by management that would indicate these assets are not recoverable. However, the current environment is subject to changing market conditions and requires significant management judgment to identify the potential impact to our assessment. If we are not able to achieve certain actions or our future operating results do not meet our expectations, it is possible that impairment charges may need to be recorded on one or more of our operating facilities.
Long-lived assets to be disposed of by sale are classified as held-for-sale and are reported at the lower of carrying amount or fair value less cost to sell, and depreciation is ceased. Long-lived assets to be disposed of in a manner other than by sale are classified as held-and-used until they are disposed.
As noted above, our goodwill impairment testing is performed annually as of October 1st at a reporting unit level. We perform more frequent impairment tests when events or changes in circumstances indicate that the fair value of a reporting unit has more likely than not declined below its carrying value. As of our annual assessment date of October 1, 2017, each of our reporting units had fair values that exceeded the carrying value of their net assets, indicating that no impairment of goodwill is warranted.
An impairment loss generally would be recognized when the carrying amount of the reporting unit’s net assets exceeds the estimated fair value of the reporting unit. The estimated fair value of a reporting unit is determined using a market approach and an income approach (under the discounted cash flow method). When supportable, the Company employs the qualitative assessment of goodwill impairment prescribed by ASC 350. As of December 31, 2017, our $72.5 million in total goodwill is allocated to our reportable segments as follows: $16.5 million to Latex Binders, $11.7 million to Synthetic Rubber, $36.4 million to Performance Plastics, and $7.9 million to Basic Plastics, with no amounts allocated to the Feedstocks or Americas Styrenics segments.
Factors which could result in future impairment charges, among others, include changes in worldwide economic conditions, changes in technology, changes in competitive conditions and customer preferences, and fluctuations in foreign currency exchange rates. These factors are discussed in Item 7A— Quantitative and Qualitative Disclosures about Market   Risk and Item 1A— Risk Factors included in this Annual Report
Income Taxes
We account for income taxes using the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences of temporary differences between the carrying amounts and tax bases of assets and liabilities using enacted rates. The effect of a change in tax rates on deferred taxes is recognized in income in the period that includes the enactment date.
On December 22, 2017, the “Tax Cuts and Jobs Act” was signed into law in the U.S.  This tax reform legislation includes a broad range of new tax laws affecting businesses, including corporate tax rates, business deductions, and international tax provisions. The Company has evaluated and accounted for all material impacts of this reform within the consolidated financial statements for the year ended December 31, 2017. The resulting impact was a one-time $3.1 million increase to tax expense related to the revaluation of the Company’s U.S. federal deferred tax assets and liabilities at the new U.S. federal corporate tax rate of 21%. There were no other applicable provisions of this newly enacted tax law that have a significant impact to the Company’s financial statements.
Deferred taxes are provided on the outside basis differences and unremitted earnings of subsidiaries outside of Luxembourg. All undistributed earnings of foreign subsidiaries and affiliates are expected to be repatriated as of December 31, 2017. Based on the evaluation of available evidence, both positive and negative, we recognize future tax benefits, such as net operating loss carryforwards and tax credit carryforwards, to the extent that realizing these benefits is considered to be more likely than not.  
As of December 31, 2017, we had deferred tax assets of $39.2 million, after valuation allowances of $149.6 million. In evaluating the ability to realize the deferred tax assets, we rely on, in order of increasing subjectivity, taxable income in prior carryback years, the future reversals of existing taxable temporary differences, tax planning strategies and forecasted taxable income using historical and projected future operating results.  

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As of December 31, 2017, we had deferred tax assets for tax loss carryforward of approximately $535.6 million, $42.1 million of which is subject to expiration in the years between 2018 and 2022. We continue to evaluate our historical and projected operating results for several legal entities for which we maintain valuation allowances on net deferred tax assets.  
We are subject to income taxes in Luxembourg, the United States and numerous foreign jurisdictions, and are subject to audit within these jurisdictions. Therefore, in the ordinary course of business there is inherent uncertainty in quantifying our income tax positions. The tax provision includes amounts considered sufficient to pay assessments that may result from examinations of prior year tax returns; however, the amount ultimately paid upon resolution of issues raised may differ from the amounts accrued. Since significant judgment is required to assess the future tax consequences of events that have been recognized in our financial statements or tax returns, the ultimate resolution of these events could result in adjustments to our financial statements and such adjustments could be material. Therefore, we consider such estimates to be critical in preparation of our financial statements.  
The financial statement effect of an uncertain income tax position is recognized when it is more likely than not, based on the technical merits, that the position will be sustained upon examination. Accruals are recorded for other tax contingencies when it is probable that a liability to a taxing authority has been incurred and the amount of the contingency can be reasonably estimated. Uncertain income tax positions have been recorded in “Other noncurrent obligations” in the consolidated balance sheets for the periods presented.  
Management judgment is required in determining our provision for income taxes, our deferred tax assets and liabilities, and any valuation allowance recorded against our deferred tax assets. The valuation allowance is based on our estimates of future taxable income and the period over which we expect the deferred tax assets to be recovered. Our assessment of future taxable income is based on historical experience and current and anticipated market and economic conditions and trends. In the event that actual results differ from these estimates or we adjust our estimates in the future, we may need to adjust our valuation allowance, which could materially impact our financial position and results of operations.  
Off-balance Sheet Arrangements
We do not have any off-balance sheet arrangements.
Recent Accounting Pronouncements
We describe the impact of recent accounting pronouncements in Note 2 to the consolidated financial statements, included elsewhere within this Annual Report.
Item 7A.    Quantitative and Qualitative Disclosures About Market Risk   
We are exposed to changes in interest rates and foreign currency exchange rates because we finance certain operations through fixed and variable rate debt instruments and denominate our transactions in a variety of foreign currencies. We are also exposed to changes in the prices of certain commodities that we use in production. Changes in these rates and commodity prices may have an impact on future cash flows and earnings. We manage these risks through normal operating and financing activities and, when deemed appropriate, through the use of derivative financial instruments. We do not enter into financial instruments for trading or speculative purposes.
By using derivative instruments, we are subject to credit and market risk. The fair market value of the derivative instruments is determined by using valuation models whose inputs are derived using market observable inputs, including interest rate yield curves, as well as foreign exchange and commodity spot and forward rates, and reflects the asset or liability position as of the end of each reporting period. When the fair value of a derivative contract is positive, the counterparty owes us, thus creating a receivable risk for us. We are exposed to counterparty credit risk in the event of non-performance by counterparties to our derivative agreements. We minimize counterparty credit (or repayment) risk by entering into transactions with various major financial institutions of investment grade credit rating.
Our exposure to market risk is not hedged in a manner that completely eliminates the effects of changing market conditions on earnings or cash flows.

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Interest Rate Risk
Given the Company’s debt structure, we have certain exposure to changes in interest rates. Refer to Note 10 in the consolidated financial statements for further information regarding the Company’s debt facilities.
On September 6, 2017, the Company issued the 2024 Term Loan B, which bears an interest rate of LIBOR plus 2.50%, subject to a 0.00% LIBOR floor. In order to reduce the variability in interest payments associated with the Company’s variable rate debt, during the third quarter of 2017, the Company entered into certain interest rate swap agreements to convert a portion of these variable rate borrowings into a fixed rate obligation. These interest rate swap agreements are designated as cash flow hedges, and as such, the contracts are marked to market at each reporting date and any unrealized gains or losses are included in AOCI to the extent effective, and reclassified to interest expense in the period during which the transaction effects earnings or it becomes probable that the forecasted transaction will not occur.
Based on weighted-average outstanding borrowings under the 2024 Term Loan B from the date of issuance through December 31, 2017, an increase in 100 basis points in the LIBO rate would have resulted in approximately $1.4 million of additional interest expense for the period, inclusive of the impact of the interest rate swap agreements discussed above.
Loans under the 2022 Revolving Facility, at the Borrowers’ option, may be maintained as (a) LIBO rate loans, which bear interest at a rate per annum equal to the LIBO rate plus the applicable margin (as defined in the Credit Agreement), if applicable, or (b) base rate loans which shall bear interest at a rate per annum equal to the base rate plus the applicable margin (as defined in the Credit Agreement). As of December 31, 2017, the Borrowers are required to pay a quarterly commitment fee in respect of any unused commitments under the 2022 Revolving Facility equal to 0.375% per annum. As of and throughout the year ended December 31, 2017, we had no variable rate debt issued under our 2022 Revolving Facility (or under our previous 2020 Revolving Facility) and as such we incurred no variable rate interest related to these facilities during the period.
Our Accounts Receivable Securitization Facility is subject to interest charges against both the amount of outstanding borrowings as well as the amount of available, but undrawn commitments under the facility. As a result of an amendment to the facility during the fourth quarter, as of December 31, 2017, fixed interest charges on outstanding borrowings for this facility are 1.95% plus variable commercial paper rates which vary by month and by currency, as outstanding balances can be denominated in euro and U.S. dollar. Fixed interest charges on available, but undrawn commitments for this facility are 1.0%. As of and throughout the year ended December 31, 2017, we had no variable rate debt issued under our Accounts Receivable Securitization Facility, and as such we incurred no variable rate interest related to this facility during the period.
Foreign Currency Risks
The Company’s ongoing business operations expose it to foreign currency risks, including fluctuating foreign exchange rates. Our primary foreign currency exposure is to the U.S. dollar to euro, noting that approximately 60% of our net sales were generated in Europe for the year ended December 31, 2017. To a lesser degree, we are also exposed to other currencies, including the Chinese yuan, Swiss franc, and Indonesian rupiah. To manage these risks, the Company periodically enters into derivative financial instruments such as foreign exchange forward contracts.
Certain subsidiaries have assets and liabilities denominated in currencies other than their respective functional currencies, which creates foreign exchange risk. Our principal strategy in managing exposure to changes in foreign currency exchange rates is to naturally hedge the foreign currency-denominated liabilities on our consolidated balance sheets against corresponding assets of the same currency such that any changes in liabilities due to fluctuations in exchange rates are offset by changes in their corresponding foreign currency assets. In order to further reduce our exposure, we also use foreign exchange forward contracts to economically hedge the impact of the variability in exchange rates on our assets and liabilities denominated in certain foreign currencies. These derivative contracts are not designated for hedge accounting treatment.
The Company also enters into forward contracts with the objective of managing the currency risk associated with forecasted U.S. dollar-denominated raw materials purchases by one of our subsidiaries whose functional currency is the euro. By entering into these forward contracts, which are designated as cash flow hedges, the Company buys a designated amount of U.S. dollars and sells euros at the prevailing market rate to mitigate the risk associated with the fluctuations in the euro-to-U.S. dollar foreign currency exchange rates. The qualifying hedge contracts are marked-to-

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market at each reporting date and any unrealized gains or losses are included in AOCI to the extent effective, and reclassified to cost of sales in the period during which the transaction affects earnings or it becomes probable that the forecasted transaction will not occur. For 2018, the Company has hedged approximately 60% of our exposure to the euro at a rate of 1.15. Inclusive of these hedges, a 1% change in the euro will impact our annual profitability by approximately $2.0 million on a pre-tax basis.
We have legal entities consolidated in our financial statements that have functional currencies other than U.S. dollar, our reporting currency. As a result of currencies fluctuating against the U.S. dollar, currency translation gains and losses are recorded in other comprehensive income, primarily as a result of the remeasurement of our euro functional legal entities as of December 31, 2017 and 2016.
Commodity Price Risk
We purchase certain raw materials such as benzene, ethylene, butadiene, BPA and styrene primarily under short- and long-term supply contracts. The pricing terms for these raw material purchases are generally determined based on commodity indices and prevailing market conditions within the relevant geography. The selling prices of our products are generally based, in part, on the current or forecasted costs of our key raw materials, but are often subject to a predetermined lag period for the pass through of these costs. As such, during periods of significant raw material price volatility, the Company may experience material volatility in earnings and cash flows due to the lag in passing through raw material costs, primarily benzene, ethylene, butadiene, and styrene. Assuming no changes in sales price, volume or mix, a hypothetical 10% change in the market price of our raw materials would have impacted cost of sales by approximately $300.0 million for the year ended December 31, 2017.
We mitigate the risk of volatility in commodity prices where possible by passing changes in raw material costs through to our customers by adjusting our prices or including provisions in our contracts that allow us to adjust prices in such a circumstance or by including pricing formulas which utilize commodity indices. Nevertheless, we may be subject to the timing differences described above for the pass through of these costs. In addition, even when raw material costs may be passed on to our customers, during periods of high raw material price volatility, customers without minimum purchase requirements with us may choose to delay purchases of our materials or, in some cases, substitute purchases of our materials with less costly products.
We do not currently enter into derivative financial instruments for trading or speculative purposes to manage our commodity price risk relating to our raw material contracts.
Item 8.    Financial Statements and Supplementary Data   
The financial statements and supplementary data required by Regulation S-X are included in Item 15- Exhibits, Financial Statements Schedules contained in Part IV of this Annual Report.
  Item 9.    Changes in and Disagreements with Accountants on Accounting and Financial Disclosure   
None.
Item 9A.    Controls and Procedures   
Evaluation of Disclosure Controls and Procedures
Our management is responsible for establishing and maintaining disclosure controls and procedures designed to provide reasonable assurance that information required to be disclosed by us in our reports that we file or submit under the Exchange Act (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended) is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures. Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the Company’s disclosure controls and procedures as of December 31, 2017. Based on that evaluation, the Chief Executive

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Officer and Chief Financial Officer concluded that our disclosure controls and procedures as of the end of the period covered by this Annual Report were effective to provide the reasonable level of assurance described above.  
Management’s Annual Report on Internal Control over Financial Reporting
Management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of the Company’s financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.
As discussed in Note 3 to the consolidated financial statements, in July 2017, the Company completed the acquisition of API Plastics. The Company began to integrate API Plastics into our internal control over financial reporting structure subsequent to the acquisition date and expects to complete this integration by June 2018. As permitted by the SEC, management has elected to exclude this acquisition from our assessment of the effectiveness of our internal control over financial reporting as of December 31, 2017. API Plastics constituted approximately 2% of the Company’s total assets as of December 31, 2017, and approximately 1% of the Company’s net sales for the year then ended.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with policies and procedures may deteriorate.
Management conducted an assessment of the Company’s internal control over financial reporting as of December 31, 2017 based on the framework in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on the assessment, management concluded that, as of December 31, 2017, the Company’s internal control over financial reporting is effective.
The effectiveness of the Company’s internal control over financial reporting as of December 31, 2017 has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report which appears herein.
Changes in Internal Control over Financial Reporting
There was no change in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act) that occurred during the quarter ended December 31, 2017 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.  
Item 9B.    Other Information   
None.
Part III 
Item 10.    Directors, Executive Officers and Corporate Governance   
The information required by this Item 10 is incorporated herein by reference from the sections captioned “Election of Directors,” “Corporate Governance,” “Stock Ownership Information,” and “Section 16(a) Beneficial Ownership Reporting Compliance” of the Company’s definitive proxy statement for the 2018 annual general meeting of shareholders to be filed with the Securities and Exchange Commission pursuant to Regulation 14A under the Securities Exchange Act of 1934 (the “2018 Proxy Statement” ).
Code of Ethics
The Company has adopted a Code of Business Conduct applicable to all of our directors, officers and employees, and a Code of Ethics for Senior Financial Employees applicable to our principal executive, financial and accounting officers, and all persons performing similar functions. A copy of each of those Codes is available on the Company’s corporate website at www.trinseo.com under Investor Relations—Corporate Governance—Ethics and Compliance. If we

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make any substantive amendments to these Codes, or grant any waivers, including any implicit waivers from the provisions of these Codes, we will make a disclosure on our website or in a report on Form 8-K. Our Code of Business of Conduct is supported by a number of subsidiary policies which are specifically referenced in the Code, and several of which are also available on our corporate website. Our website and the information contained on that site, or accessible through that site, are not incorporated into and are not a part of this Annual Report .
Item 11.    Executive Compensation 
The information required by this Item 11 will be contained in our 2018 Proxy Statement and is incorporated by reference herein.
Item 12.    Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters   
The information required by this Item 12 will be contained in our 2018 Proxy Statement and is incorporated by reference herein.  
Item 13.    Certain Relationships and Related Transactions, and Director Independence   
The information required by this Item 13 will be contained in our 2018 Proxy Statement and is incorporated by reference herein.  
Item 14.    Principal Accounting Fees and Services   
The information required by this Item 14 will be contained in our 2018 Proxy Statement and is incorporated by reference herein.  

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Part IV 
Item 15.    Exhibits, Financial Statement Schedules   
(a) The following documents are filed as part of this report:
1. Financial statements:
 
Report of Independent Registered Public Accounting Firm  	F-2	
Consolidated Balance Sheets as of December 31, 2017 and 2016  	F-4	
Consolidated Statements of Operations for the years ended December 31, 2017, 2016, and 2015  	F-5	
Consolidated Statements of Comprehensive Income (Loss) for the years ended December 31, 2017, 2016, and 2015  	F-6	
Consolidated Statements of Shareholders’ Equity for the years ended December 31, 2017, 2016, and 2015  	F-7	
Consolidated Statements of Cash Flows for the years ended December 31, 2017, 2016, and 2015  	F-8	
Notes to Consolidated Financial Statements for the years ended December 31, 2017, 2016, and 2015  	F-9	
Financial Statement Schedule – Schedule II. Valuation and Qualifying Accounts for the years ended December 31, 2017, 2016, and 2015  	F-57	

Americas Styrenics LLC	 	
Audited Consolidated Financial Statements	 	
Report of Independent Registered Public Accounting Firm  	F-58	
Consolidated Balance Sheets as of December 31, 2017 and 2016  	F-59	
Consolidated Statements of Comprehensive Income for the years ended December 31, 2017, 2016, and 2015  	F-60	
Consolidated Statements of Members’ Equity for the years ended December 31, 2017, 2016, and 2015  	F-61	
Consolidated Statements of Cash Flows for the years ended December 31, 2017, 2016, and 2015  	F-62	
Notes to Consolidated Financial Statements for the years ended December 31, 2017, 2016, and 2015  	F-63	

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2. Exhibits: The exhibits to this report are listed in the exhibit index below.
EXHIBIT INDEX

Exhibit
No.	 	Description	
3.1	 	Amended and Restated Articles of Association of Trinseo S.A., as amended (incorporated herein by reference to Exhibit 3.1 to the Quarterly Report filed on Form 10-Q, File No. 001-36473, filed August 3, 2017)	
 	 	 	
4.1	 	Indenture among Trinseo Materials Operating S.C.A., Trinseo Materials Finance, Inc. and The Bank of New York Mellon, as Trustee, dated as of August 29, 2017 (incorporated herein by reference to Exhibit 4.1 to the Current Report filed on Form 8-K, File No. 001-36473, filed September 5, 2017)	
 	 	 	
4.2	 	Form of Specimen Share Certificate of Trinseo S.A. (incorporated herein by reference to Exhibit 4.1 to Amendment No. 3 of the Registration Statement filed on Form S-1, File No. 333-194561, filed May 16, 2014)	
 	 	 	
10.1	 	Credit Agreement among Trinseo Materials Operating S.C.A., Trinseo Materials Finance, Inc. together with Trinseo Holdings S.à r.l., and Trinseo Materials S.à r.l., Deutsche Bank AG New York Branch, as administrative agent, collateral agent, L/C issuer and swing line lender, and the guarantors and lenders from time to time party thereto, dated as of September 6, 2017 (incorporated herein by reference to Exhibit 10.1 to the Current Report filed on Form 8-K, No. 001-36473, filed September 7, 2017)	
 	 	 	
10.2	 	Form of Cross-Currency Rate Swap Transaction Confirmation (incorporated herein by reference to Exhibit 10.2 to the Current Report filed on Form 8-K, File No. 001-36473, filed September 7, 2017)	
 	 	 	
10.3	 	Amended and Restated Employment Agreement, among Trinseo US Holding, Inc. and Christopher D. Pappas, dated December 20, 2017 (incorporated herein by reference to Exhibit 10.1 to the Current Report filed on Form 8-K, File No. 001-36473, filed December 27, 2017)	
 	 	 	
10.4	 	Employment Agreement between Trinseo LLC and Barry Niziolek, dated May 20, 2016 (incorporated herein by reference to Exhibit 10.1 to the Current Report filed on Form 8-K, File No. 001-36473, filed May 23, 2016)	
 	 	 	
10.5	 	Employment Agreement, dated September 14, 2015 by and between Trinseo Europe GmbH. and Timothy M. Stedman (incorporated herein by reference to Exhibit 10.11 to the Annual Report filed on Form 10-K, File No. 001-36473, filed March 11, 2016)	
 	 	 	
10.6	 	Employment Agreement, dated August 7, 2015, by and between Trinseo Europe GmbH and Hayati Yarkadas (incorporated herein by reference to Exhibit 10.12 to the Annual Report filed on Form 10-K, File No. 001-36473, filed March 11, 2016)	
 	 	 	
10.7	 	Employment Agreement, among Trinseo US Holding, Inc. (f/k/a Bain Capital Everest US Holding, Inc.) Bain Capital Everest Manager Holding SCA and Marilyn Horner, dated January 5, 2011 (incorporated herein by reference to Exhibit 10.12 to the Annual Report filed on Form 10-K, File No. 001-36473, filed March 10, 2015)	
 	 	 	
10.8	 	First Amendment to Employment Agreement, among Trinseo US Holding, Inc. (f/k/a Bain Capital Everest US Holding, Inc.) Bain Capital Everest Manager Holding SCA and Marilyn Horner, dated February 14, 2012 (incorporated herein by reference to Exhibit 10.13 to the Annual Report filed on Form 10-K, File No. 001-36473, filed March 10, 2015)	

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Exhibit
No.	 	Description	

10.9†	 	Second Amendment to Employment Agreement, among Trinseo US Holding, Inc., Trinseo S.A. and Marilyn Horner, dated December 20, 2017  	
 	 	 	
10.10†	 	Retention Award Letter Agreement, dated December 21, 2017, between Trinseo US Holding, Inc., Trinseo LLC and Marilyn Horner	
 	 	 	
10.11	 	Letter Agreement, dated March 1, 2016, between Trinseo S.A. and Marilyn N. Horner, defining retirement for purpose of equity awards (incorporated by reference to Exhibit 10.5 to the Quarterly Report filed on Form 10-Q, File No. 001-36473, filed May 5, 2016)	
 	 	 	
10.12	 	Employment Agreement, dated November 17, 2014, by and between Trinseo US Holding, Inc. (f/k/a Bain Capital Everest US Holding, Inc.) and Angelo N. Chaclas (incorporated herein by reference to Exhibit 10.10 to the Annual Report filed on Form 10-K, File No. 001-36473, filed March 11, 2016)	
 	 	 	
10.13*	 	Second Amended and Restated Master Outsourcing Services Agreement, among The Dow Chemical Company and Trinseo LLC (f/k/a Styron LLC) and Trinseo Holding B.V. (f/k/a Styron Holding B.V.), dated June 1, 2013 (incorporated herein by reference to Exhibit 10.19 to Amendment No. 2 to the Registration Statement filed on Form S-4, File No. 333-191460, filed December 17, 2013)	
 	 	 	
10.14*	 	Contract of Sale, by and between Americas Styrenics LLC and The Dow Chemical Company, dated December 1, 2009, as amended by that certain Amendment to and Consent to Partial Assignment, dated April 1, 2010 (incorporated herein by reference to Exhibit 10.20 to Amendment No. 2 to the Registration Statement filed on Form S-4, File No. 333-191460, filed December 17, 2013)	
 	 	 	
10.15*	 	Amended and Restated Ethylene Sales Contract (Europe), between Dow Europe GmbH and Trinseo Europe GmbH (f/k/a Styron Europe GmbH), dated June 17, 2010 (incorporated herein by reference to Exhibit 10.22 to Amendment No. 2 to the Registration Statement filed on Form S-4, File No. 333-191460, filed December 17, 2013)	
 	 	 	
10.16*	 	Amended and Restated Benzene Sales Contract (Europe), between Dow Europe GmbH and Trinseo Europe GmbH (f/k/a Styron Europe GmbH), dated June 17, 2010 (incorporated herein by reference to Exhibit 10.23 to Amendment No. 2 to the Registration Statement filed on Form S-4, File No. 333-191460, filed December 17, 2013)	
 	 	 	
10.17*	 	Amended and Restated Butadiene Sales Contract (Europe), between Dow Europe GmbH and Trinseo Europe GmbH (f/k/a Styron Europe GmbH), dated June 17, 2010 (incorporated herein by reference to Exhibit 10.27 to Amendment No. 2 to the Registration Statement filed on Form S-4, File No. 333-191460, filed December 17, 2013)	
 	 	 	
10.18*	 	Amended and Restated MOD5 Computerized Process Control Software Agreement, Licenses and Services, between Rofan Services Inc. and Trinseo LLC (f/k/a Styron LLC), dated as of June 17, 2010 (incorporated herein by reference to Exhibit 10.29 to the Registration Statement filed on Form S-4, File No. 333-191460, filed September 30, 2013)	
 	 	 	
10.19*	 	Amendment No. 1 to the Amended and Restated MOD5 Computerized Process Control Software Agreement, Licenses and Services, between Rofan Services Inc. and Trinseo LLC (f/k/a Styron LLC), dated as of June 1, 2013 (incorporated herein by reference to Exhibit 10.30 to Amendment No. 2 to the Registration Statement filed on Form S-4, File No. 333-191460, filed December 17, 2013)	

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Exhibit
No.	 	Description	

10.20*	 	Amended and Restated Styron License Agreement, among The Dow Chemical Company, Dow Global Technologies Inc. and Trinseo LLC (f/k/a Styron LLC), dated as of June 17, 2010. (incorporated herein by reference to Exhibit 10.31 to Amendment No. 2 to the Registration Statement filed on Form S-4, File No. 333-191460, filed December 17, 2013)	
 	 	 	
10.21†	 	Deed of Amendment, Restatement and Accession, dated December 21, 2017 entered into by and among Trinseo Europe GmbH, Trinseo Export GmbH, Trinseo Deutschland Anlagengesellschaft mbH, Trinseo Netherlands B.V., Trinseo LLC, Trinseo U.S. Receivables Company SPV LLC, Styron Receivables Funding Designated Activity Company, Trinseo Finance Luxembourg S.à r.l., Luxembourg, Zweigniederlassung Horgen, Regency Assets Designated Activity Company, HSBC Bank plc, Trinseo Holding S.à r.l., TMF Administration Services Limited and the Law Debenture Trust Corporation plc  	
 	 	 	
10.22	 	Form of Restoration and Elective Deferral Plan (incorporated herein by reference to Exhibit 10.35 to Amendment No. 2 to the Registration Statement on Form S-1, File No. 333-194561, filed May 5, 2014)	
 	 	 	
10.23	 	Performance Award (PA) Plan (incorporated herein by reference to Exhibit 10.36 to Amendment No. 2 to the Registration Statement on Form S-1, File No. 333-194561, filed May 5, 2014)  	
 	 	 	
10.24	 	Form of 2014 Omnibus Incentive Plan (incorporated herein by reference to Exhibit 10.34 to Amendment No. 3 to the Registration Statement on Form S-1, File No. 333-194561, filed May 16, 2014)	
 	 	 	
10.25	 	Trinseo S.A. Cash Incentive Plan (incorporated herein by reference to Exhibit 10.35 to Amendment No. 3 to the Registration Statement on Form S-1, File No. 333-194561, filed May 16, 2014)	
 	 	 	
10.26	 	Form of Indemnification Agreement for Directors and Officers (incorporated herein by reference to Exhibit 10.1 to the Quarterly Report on Form 10-Q, File No.001-36473, filed August 3, 2017)	
 	 	 	
10.27†	 	Form of Director Offer Letter	
 	 	 	
10.28	 	Form of Restricted Stock Unit Agreement for Directors (incorporated herein by reference to Exhibit 10.1 to the Quarterly Report on Form 10-Q, File No. 001-36473, filed May 3, 2017)	
 	 	 	
10.29	 	Form of Restricted Stock Unit Award Agreement for Executives (incorporated herein by reference to Exhibit 10.2 to the Quarterly Report filed on Form 10-Q, File No. 001-36473, filed May 3, 2017)	
 	 	 	
10.30	 	Form of Non-statutory Stock Option Award Agreement for Executives (incorporated herein by reference to Exhibit 10.3 to the Quarterly Report filed on Form 10-Q, File No. 001-36473, filed May 3, 2017)	
 	 	 	
10.31	 	Form of Performance Award Stock Unit Agreement for Executives (incorporated herein by reference to Exhibit 10.4 to the Quarterly Report filed on Form 10-Q, File No. 001-36473, filed May 3, 2017)	
 	 	 	
10.32	 	Form of Restricted Stock Unit Award Agreement for Employees (incorporated herein by reference to Exhibit 10.5 to the Quarterly Report filed on Form 10-Q, File No. 001-36473, filed May 3, 2017)	
 	 	 	
10.33	 	Form of Non-statutory Stock Option Award Agreement for Employees (incorporated herein by reference to Exhibit 10.6 to the Quarterly Report filed on Form 10-Q, File No. 001-36473, filed May 3, 2017)	

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Exhibit
No.	 	Description	

10.34	 	Form of Letter Agreement to Restricted Stock Unit Awardees regarding payment of dividend equivalents (incorporated herein by reference to Exhibit 10.38 to the Annual Report filed on Form 10-K, File No. 001-36473, filed March 1, 2017)	
 	 	 	
12.1†	 	Statement of Computation of Ratios of Earnings to Fixed Charges	
 	 	 	
21.1†	 	Subsidiaries of Trinseo S.A.	
 	 	 	
23.1†	 	Consent of Independent Registered Public Accounting Firm PricewaterhouseCoopers LLP	
 	 	 	
23.2†	 	Consent of Independent Registered Public Accounting Firm Deloitte & Touche LLP	
 	 	 	
31.1†	 	Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	
 	 	 	
31.2†	 	Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	
 	 	 	
32.1†	 	Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	
 	 	 	
32.2†	 	Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	
 	 	 	
101.INS†	 	XBRL Instance Document	
 	 	 	
101.SCH†	 	XBRL Taxonomy Extension Schema Document	
 	 	 	
101.CAL†	 	XBRL Taxonomy Extension Calculation Linkbase Document	
 	 	 	
101.DEF†	 	XBRL Taxonomy Extension Definition Linkbase Document	
 	 	 	
101.LAB†	 	XBRL Extension Label Linkbase Document	
 	 	 	
101.PRE†	 	XBRL Taxonomy Extension Presentation Linkbase Document	

* Application has been made to the Securities and Exchange Commission for confidential treatment of certain provisions of these exhibits. Omitted material for which confidential treatment has been requested has been filed separately with the Securities and Exchange Commission.
† Filed herewith.
Item 16.    Form 10-K Summary 
None.

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SIGNATURES 
Pursuant to the requirements of Section 13 or 15(d) of the Securities Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Date: March 1, 2018

 	TRINSEO S.A.	
 	 	 	
 	By:	/s/    Christopher D. Pappas	
 	Name:	Christopher D. Pappas	
 	Title:	President and Chief Executive Officer	
 
Pursuant to the requirements of the Securities Act of 1934, this report has been signed by the following persons in the capacities and on the dates indicated.

Signature	    	Title	    	Date    	
 	 	 	 	 	
/s/ Christopher D. Pappas	 	President and Chief Executive Officer	 	March 1, 2018	
Christopher D. Pappas	 	(Principal Executive Officer)	 	 	
 	 	 	 	 	
/s/ Barry J. Niziolek	 	Executive Vice President and Chief Financial Officer	 	March 1, 2018	
Barry J. Niziolek	 	(Principal Financial Officer)	 	 	
 	 	 	 	 	
/s/ Ryan J. Leib 	 	Vice President, Global Controller and Principal Accounting Officer	 	March 1, 2018	
Ryan J. Leib	 	(Principal Accounting Officer)	 	 	
 	 	 	 	 	
/s/ Joseph Alvarado	 	Director	 	March 1, 2018	
Joseph Alvarado	 	 	 	 	
 	 	 	 	 	
/s/ Jeffrey J. Cote	 	Director	 	March 1, 2018	
Jeffrey J. Cote	 	 	 	 	
 	 	 	 	 	
/s/ Pierre-Marie De Leener	 	Director	 	March 1, 2018	
Pierre-Marie De Leener	 	 	 	 	
 	 	 	 	 	
/s/ K’Lynne Johnson	 	Director	 	March 1, 2018	
K’Lynne Johnson	 	 	 	 	
 	 	 	 	 	
/s/ Philip R. Martens	 	Director	 	March 1, 2018	
Philip R. Martens	 	 	 	 	
 	 	 	 	 	
/s/ Donald T. Misheff	 	Director	 	March 1, 2018	
Donald T. Misheff	 	 	 	 	
 	 	 	 	 	
/s/ Henri Steinmetz	 	Director	 	March 1, 2018	
Henri Steinmetz	 	 	 	 	
 	 	 	 	 	
/s/ Stephen M. Zide	 	Director	 	March 1, 2018	
Stephen M. Zide	 	 	 	 	

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INDEX TO CONSOLIDATED FINANCIAL STATEMENTS 

Audited Consolidated Financial Statements	 	
Report of Independent Registered Public Accounting Firm  	F-2	
Consolidated Balance Sheets as of December 31, 2017 and 2016  	F-4	
Consolidated Statements of Operations for the years ended December 31, 2017, 2016, and 2015  	F-5	
Consolidated Statements of Comprehensive Income (Loss) for the years ended December 31, 2017, 2016, and 2015  	F-6	
Consolidated Statements of Shareholders’ Equity for the years ended December 31, 2017, 2016, and 2015  	F-7	
Consolidated Statements of Cash Flows for the years ended December 31, 2017, 2016, and 2015  	F-8	
Notes to Consolidated Financial Statements for the years ended December 31, 2017, 2016, and 2015  	F-9	
Financial Statement Schedule – Schedule II. Valuation and Qualifying Accounts for the years ended December 31, 2017, 2016, and 2015  	F-57	
 	 	
Americas Styrenics LLC*	 	
Audited Consolidated Financial Statements	 	
Report of Independent Registered Public Accounting Firm  	F-58	
Consolidated Balance Sheets as of December 31, 2017 and 2016  	F-59	
Consolidated Statements of Comprehensive Income for the years ended December 31, 2017, 2016, and 2015  	F-60	
Consolidated Statements of Members’ Equity for the years ended December 31, 2017, 2016, and 2015  	F-61	
Consolidated Statements of Cash Flows for the years ended December 31, 2017, 2016, and 2015  	F-62	
Notes to Consolidated Financial Statements for the years ended December 31, 2017, 2016, and 2015  	F-63	

* The audited financial statements of Americas Styrenics LLC as of December 31, 2017 and 2016 and for the years ended December 31, 2017, 2016 and 2015 have been included in this Annual Report in accordance with the requirements of Rule 3-09 of Regulation S-X.

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Report of Independent Registered Public Accounting Fir  m
 
To the Board of Directors and Shareholders of Trinseo S.A.
Opinions on the Financial Statements and Internal Control over Financial Reporting
We have audited the accompanying consolidated balance sheets of Trinseo S.A. and its subsidiaries as of December 31, 2017 and 2016, and the related consolidated statements of operations, comprehensive income (loss), shareholders’ equity and cash flows for each of the three years in the period ended December 31, 2017, including the related notes and financial statement schedule listed in the accompanying index (collectively referred to as the “consolidated financial statements”).  We also have audited the Company’s internal control over financial reporting as of December 31, 2017, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
In our opinion, based on our audits and the report of other auditors, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2017 and 2016, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2017 in conformity with accounting principles generally accepted in the United States of America.  Also in our opinion, based on our audit, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2017, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO. 
We did not audit the financial statements of Americas Styrenics LLC, a 50% equity investment of Trinseo S.A., as of and for the years ended December 31, 2017 and 2016, which is reflected in the consolidated financial statements of Trinseo S.A. as an equity method investment of $152.5 million and $149.7 million as of December 31, 2017 and 2016, respectively, and income from equity investment of $122.9 million, $135.8 million and $135.3 million for the years ended December 31, 2017, 2016 and 2015 respectively. Those statements were audited by other auditors whose report thereon has been furnished to us, and our opinion expressed herein, insofar as it relates to the amounts included for Americas Styrenics LLC, is based solely on the report of the other auditors.
Change in Accounting Principle
As discussed in Note 2 to the consolidated financial statements, the Company changed the manner in which it presents and classifies certain items in the consolidated statements of cash flows in 2017.
Basis for Opinions
The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in Management's Annual Report on Internal Control over Financial Reporting appearing under Item 9A.  Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company's internal control over financial reporting based on our audits.  We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. 
We conducted our audits in accordance with the standards of the PCAOB.  Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects. 
Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.  Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements.  Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.  Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the

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risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk.  Our audits also included performing such other procedures as we considered necessary in the circumstances.  We believe that our audits and the report of other auditors provide a reasonable basis for our opinions.
As described in Management’s Annual Report on Internal Control over Financial Reporting, management has excluded API Plastics from its assessment of internal control over financial reporting as of December 31, 2017 because it was acquired by the Company in a purchase business combination during 2017.  We have also excluded API Plastics from our audit of internal control over financial reporting.  API Plastics is a wholly-owned subsidiary whose total assets and total revenues excluded from management’s assessment and our audit of internal control over financial reporting represent approximately 2% and 1%, respectively, of the related consolidated financial statement amounts as of and for the year ended December 31, 2017.
Definition and Limitations of Internal Control over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.  A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.  Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ PricewaterhouseCoopers LLP
Philadelphia, PA
March 1, 2018
 
We have served as the Company’s auditor since 2010.

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TRINSEO S.A.
Consolidated Balance Sheets 
(In millions, except per share data)

 	 	December 31, 	 	
 	    	2017	    	2016	 	
Assets	 	 	 	 	 	    	 	
Current assets	 	 	 	 	 	 	 	
Cash and cash equivalents	 	$	432.8	 	$	465.1	 	
Accounts receivable, net of allowance	 	 	685.5	 	 	564.4	 	
Inventories	 	 	510.4	 	 	385.3	 	
Other current assets	 	 	17.5	 	 	18.1	 	
Total current assets	 	 	1,646.2	 	 	1,432.9	 	
Investments in unconsolidated affiliates	 	 	152.5	 	 	191.4	 	
Property, plant and equipment, net	 	 	627.0	 	 	510.0	 	
Other assets	 	 	 	 	 	 	 	
Goodwill	 	 	72.5	 	 	38.0	 	
Other intangible assets, net	 	 	207.5	 	 	177.3	 	
Deferred income tax assets	 	 	35.5	 	 	43.8	 	
Deferred charges and other assets	 	 	30.8	 	 	27.9	 	
Total other assets	 	 	346.3	 	 	287.0	 	
Total assets	 	$	2,772.0	 	$	2,421.3	 	
Liabilities and shareholders’ equity	 	 	 	 	 	 	 	
Current liabilities	 	 	 	 	 	 	 	
Short-term borrowings and current portion of long-term debt	 	$	7.0	 	$	5.0	 	
Accounts payable	 	 	436.8	 	 	378.0	 	
Income taxes payable	 	 	35.9	 	 	23.8	 	
Accrued expenses and other current liabilities	 	 	146.9	 	 	135.4	 	
Total current liabilities	 	 	626.6	 	 	542.2	 	
Noncurrent liabilities	 	 	 	 	 	 	 	
Long-term debt, net of unamortized deferred financing fees	 	 	1,165.0	 	 	1,160.4	 	
Deferred income tax liabilities	 	 	49.2	 	 	24.8	 	
Other noncurrent obligations	 	 	256.4	 	 	246.2	 	
Total noncurrent liabilities	 	 	1,470.6	 	 	1,431.4	 	
Commitments and contingencies (Note 14)	 	 	 	 	 	 	 	
Shareholders’ equity	 	 	 	 	 	 	 	
Ordinary shares, $0.01 nominal value, 50,000.0 shares authorized (December 31, 2017: 48.8 shares issued and 43.4 shares outstanding; December 31, 2016: 48.8 shares issued and 44.3 shares outstanding)	 	 	0.5	 	 	0.5	 	
Additional paid-in-capital	 	 	578.8	 	 	573.7	 	
Treasury shares, at cost (December 31, 2017: 5.4 shares; December 31, 2016: 4.5 shares)	 	 	(286.8)	 	 	(217.5)	 	
Retained earnings	 	 	527.9	 	 	261.2	 	
Accumulated other comprehensive loss	 	 	(145.6)	 	 	(170.2)	 	
Total shareholders’ equity	 	 	674.8	 	 	447.7	 	
Total liabilities and shareholders’ equity	 	$	2,772.0	 	$	2,421.3	 	
 
The accompanying notes are an integral part of these consolidated financial statements.

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TRINSEO S.A.
Consolidated Statements of Operations 
(In millions, except per share data)

 	 	Year Ended December 31,	 	
 	    	2017	    	2016	    	2015	 	
Net sales	 	$	4,448.1	    	$	3,716.6	 	$	3,971.9	 	
Cost of sales	 	 	3,794.1	 	 	3,129.0	 	 	3,502.8	 	
Gross profit	 	 	654.0	 	 	587.6	 	 	469.1	 	
Selling, general and administrative expenses	 	 	239.0	 	 	241.5	 	 	208.0	 	
Equity in earnings of unconsolidated affiliates	 	 	123.7	 	 	144.7	 	 	140.2	 	
Operating income	 	 	538.7	 	 	490.8	 	 	401.3	 	
Interest expense, net	 	 	70.1	 	 	75.0	 	 	93.2	 	
Loss on extinguishment of long-term debt	 	 	65.3	 	 	 —	 	 	95.2	 	
Other expense (income), net	 	 	(7.8)	 	 	10.5	 	 	9.1	 	
Income before income taxes	 	 	411.1	 	 	405.3	 	 	203.8	 	
Provision for income taxes	 	 	82.8	 	 	87.0	 	 	70.2	 	
Net income	 	$	328.3	 	$	318.3	 	$	133.6	 	
Weighted average shares- basic	 	 	43.8	 	 	46.5	 	 	48.8	 	
Net income per share- basic	 	$	7.49	 	$	6.84	 	$	2.74	 	
Weighted average shares- diluted	 	 	45.0	 	 	47.5	 	 	49.0	 	
Net income per share- diluted	 	$	7.30	 	$	6.70	 	$	2.73	 	
 	 	 	 	 	 	 	 	 	 	 	
Dividends per share	 	$	1.38	 	$	0.90	 	$	 —	 	
The accompanying notes are an integral part of these consolidated financial statements.

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TRINSEO S.A.
Consolidated Statements of Comprehensive Income (Loss) 
(In millions)

 	 	Year Ended December 31,	 	
 	 	2017	    	2016	    	2015	 	
Net income	    	$	328.3	    	$	318.3	 	$	133.6	 	
Other comprehensive income (loss), net of tax:	 	 	 	 	 	 	 	 	 	 	
Cumulative translation adjustments	 	 	24.5	 	 	(9.8)	 	 	(91.4)	 	
Net gain (loss) on cash flow hedges	 	 	(18.4)	 	 	6.7	 	 	5.6	 	
Pension and other postretirement benefit plans:	 	 	 	 	 	 	 	 	 	 	
Prior service credit arising during period (net of tax of $0, $0, and $0.2)	 	 	 —	 	 	 —	 	 	3.2	 	
Net gain (loss) arising during period (net of tax of $10.8, $(7.3), and $2.8)	 	 	31.8	 	 	(20.6)	 	 	4.7	 	
Amounts reclassified from accumulated other comprehensive income (loss)	 	 	(13.3)	 	 	3.3	 	 	3.4	 	
Total other comprehensive income (loss), net of tax	 	 	24.6	 	 	(20.4)	 	 	(74.5)	 	
Comprehensive income	 	$	352.9	 	$	297.9	 	$	59.1	 	
 
The accompanying notes are an integral part of these consolidated financial statements.

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TRINSEO S.A.
Consolidated Statements of Shareholders’ Equity 
(In millions, except per share data)

 	    	Shares	    	Shareholders' Equity	 	
 	 	Ordinary Shares Outstanding	 	Treasury Shares	 	Ordinary Shares	 	Additional
Paid-In Capital	 	Treasury Shares	 	Accumulated Other Comprehensive Income (Loss)	 	Retained Earnings (Accumulated Deficit)	 	Total	 	
Balance at December 31, 2014	 	48.8	 	 —	 	$	0.5	 	$	547.6	 	$	 —	 	$	(75.3)	 	$	(149.2)	 	$	323.6	 	
Net income	 	 —	 	 —	 	 	 —	 	 	 —	 	 	 —	 	 	 —	 	 	133.6	 	 	133.6	 	
Other comprehensive loss	 	 —	 	 —	 	 	 —	 	 	 —	 	 	 —	 	 	(74.5)	 	 	 —	 	 	(74.5)	 	
Stock-based compensation activity	 	 —	 	 —	 	 	 —	 	 	9.0	 	 	 —	 	 	 —	 	 	 —	 	 	9.0	 	
Balance at December 31, 2015	 	48.8	 	 —	 	$	0.5	 	$	556.6	 	$	 —	 	$	(149.8)	 	$	(15.6)	 	$	391.7	 	
Adoption of new accounting standard	 	 —	 	 —	 	 	 —	 	 	0.9	 	 	 —	 	 	 —	 	 	(0.9)	 	 	 —	 	
Net income	 	 —	 	 —	 	 	 —	 	 	 —	 	 	 —	 	 	 —	 	 	318.3	 	 	318.3	 	
Other comprehensive loss	 	 —	 	 —	 	 	 —	 	 	 —	 	 	 —	 	 	(20.4)	 	 	 —	 	 	(20.4)	 	
Stock-based compensation activity	 	 —	 	 —	 	 	 —	 	 	16.2	 	 	1.0	 	 	 —	 	 	 —	 	 	17.2	 	
Purchase of treasury shares	 	(4.5)	 	4.5	 	 	 —	 	 	 —	 	 	(218.5)	 	 	 —	 	 	 —	 	 	(218.5)	 	
Dividends on ordinary shares ($0.90 per share)	 	 —	 	 —	 	 	 —	 	 	 —	 	 	 —	 	 	 —	 	 	(40.6)	 	 	(40.6)	 	
Balance at December 31, 2016	 	44.3	 	4.5	 	$	0.5	 	$	573.7	 	$	(217.5)	 	$	(170.2)	 	$	261.2	 	$	447.7	 	
Net income	 	 —	 	 —	 	 	 —	 	 	 —	 	 	 —	 	 	 —	 	 	328.3	 	 	328.3	 	
Other comprehensive income	 	 —	 	 —	 	 	 —	 	 	 —	 	 	 —	 	 	24.6	 	 	 —	 	 	24.6	 	
Stock-based compensation activity	 	0.5	 	(0.5)	 	 	 —	 	 	5.1	 	 	17.5	 	 	 —	 	 	 —	 	 	22.6	 	
Purchase of treasury shares	 	(1.4)	 	1.4	 	 	 —	 	 	 —	 	 	(86.8)	 	 	 —	 	 	 —	 	 	(86.8)	 	
Dividends on ordinary shares ($1.38 per share)	 	 —	 	 —	 	 	 —	 	 	 —	 	 	 —	 	 	 —	 	 	(61.6)	 	 	(61.6)	 	
Balance at December 31, 2017	 	43.4	 	5.4	 	$	0.5	 	$	578.8	 	$	(286.8)	 	$	(145.6)	 	$	527.9	 	$	674.8	 	
The accompanying notes are an integral part of these consolidated financial statements.

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TRINSEO S.A.
Consolidated Statements of Cash Flows 
(In millions)

 	 	Year Ended December 31,	 	
 	 	2017	 	2016	 	2015	 	
Cash flows from operating activities	    	 	    	 	 	    	 	 	    	 	
Net income	 	$	328.3	 	$	318.3	 	$	133.6	 	
Adjustments to reconcile net income to net cash provided by operating activities	 	 	 	 	 	 	 	 	 	 	
Depreciation and amortization	 	 	110.6	 	 	96.4	 	 	96.8	 	
Amortization of deferred financing fees and issuance discount	 	 	5.1	 	 	5.8	 	 	7.7	 	
Deferred income tax	 	 	14.8	 	 	16.1	 	 	(0.1)	 	
Stock-based compensation expense	 	 	13.8	 	 	17.1	 	 	9.0	 	
Earnings of unconsolidated affiliates, net of dividends	 	 	5.3	 	 	(13.4)	 	 	(15.2)	 	
Unrealized net losses (gains) on foreign exchange forward contracts	 	 	2.6	 	 	3.2	 	 	(9.0)	 	
Loss on extinguishment of long-term debt	 	 	65.3	 	 	 —	 	 	95.2	 	
Loss (gain) on sale of businesses and other assets	 	 	(10.5)	 	 	14.9	 	 	 —	 	
Impairment charges	 	 	4.3	 	 	15.1	 	 	 —	 	
Pension curtailment and settlement gains	 	 	(21.6)	 	 	 —	 	 	 —	 	
Changes in assets and liabilities	 	 	 	 	 	 	 	 	 	 	
Accounts receivable	 	 	(51.8)	 	 	(96.4)	 	 	65.1	 	
Inventories	 	 	(80.2)	 	 	(51.0)	 	 	97.2	 	
Accounts payable and other current liabilities	 	 	9.3	 	 	57.1	 	 	(71.9)	 	
Income taxes payable	 	 	9.9	 	 	3.8	 	 	12.0	 	
Other assets, net	 	 	(4.5)	 	 	5.4	 	 	3.2	 	
Other liabilities, net	 	 	(9.4)	 	 	11.3	 	 	(1.7)	 	
Cash provided by operating activities	 	 	391.3	 	 	403.7	 	 	421.9	 	
Cash flows from investing activities	 	 	 	 	 	 	 	 	 	 	
Capital expenditures	 	 	(147.4)	 	 	(123.9)	 	 	(109.3)	 	
Cash paid to acquire a business, net of cash acquired	 	 	(82.3)	 	 	 —	 	 	 —	 	
Proceeds from capital expenditures subsidy	 	 	 —	 	 	 —	 	 	2.2	 	
Proceeds from the sale of businesses and other assets	 	 	46.2	 	 	2.0	 	 	0.8	 	
Distributions from unconsolidated affiliates	 	 	0.9	 	 	4.8	 	 	 —	 	
Other investing cash outflows	 	 	 —	 	 	(0.2)	 	 	(0.4)	 	
Cash used in investing activities	 	 	(182.6)	 	 	(117.3)	 	 	(106.7)	 	
Cash flows from financing activities	 	 	 	 	 	 	 	 	 	 	
Deferred financing fees	 	 	(21.5)	 	 	 —	 	 	(28.2)	 	
Short-term borrowings, net	 	 	(0.3)	 	 	(0.3)	 	 	(18.4)	 	
Purchase of treasury shares	 	 	(88.9)	 	 	(215.1)	 	 	 —	 	
Dividends paid	 	 	(58.0)	 	 	(27.3)	 	 	 —	 	
Proceeds from exercise of option awards	 	 	9.3	 	 	0.2	 	 	 —	 	
Withholding taxes paid on restricted share units	 	 	(0.3)	 	 	(0.1)	 	 	 —	 	
Net proceeds from issuance of 2024 Term Loan B	 	 	700.0	 	 	 —	 	 	 —	 	
Repayments of 2024 Term Loan B	 	 	(1.8)	 	 	 —	 	 	 —	 	
Repayments of 2021 Term Loan B	 	 	(492.5)	 	 	(5.0)	 	 	(2.5)	 	
Net proceeds from issuance of 2025 Senior Notes	 	 	500.0	 	 	 —	 	 	 —	 	
Repayments of 2022 Senior Notes	 	 	(746.0)	 	 	 —	 	 	 —	 	
Prepayment penalty on long-term debt	 	 	(53.0)	 	 	 —	 	 	(68.6)	 	
Net proceeds from issuance of 2021 Term Loan B	 	 	 —	 	 	 —	 	 	498.8	 	
Net proceeds from issuance of 2022 Senior Notes	 	 	 —	 	 	 —	 	 	716.6	 	
Repayments of 2019 Senior Notes	 	 	 —	 	 	 —	 	 	(1,192.5)	 	
Proceeds from Accounts Receivable Securitization Facility	 	 	 —	 	 	 —	 	 	25.0	 	
Repayments of Accounts Receivable Securitization Facility	 	 	 —	 	 	 —	 	 	(25.0)	 	
Cash used in financing activities	 	 	(253.0)	 	 	(247.6)	 	 	(94.8)	 	
Effect of exchange rates on cash	 	 	12.0	 	 	(5.0)	 	 	(9.9)	 	
Net change in cash and cash equivalents	 	 	(32.3)	 	 	33.8	 	 	210.5	 	
Cash and cash equivalents—beginning of period	 	 	465.1	 	 	431.3	 	 	220.8	 	
Cash and cash equivalents—end of period	 	$	432.8	 	$	465.1	 	$	431.3	 	
Supplemental disclosure of cash flow information	 	 	 	 	 	 	 	 	 	 	
Cash paid for income taxes, net of refunds	 	$	75.0	 	$	66.6	 	$	58.2	 	
Cash paid for interest, net of amounts capitalized	 	$	63.3	 	$	69.4	 	$	121.2	 	
Accrual for property, plant and equipment	 	$	15.6	 	$	35.6	 	$	14.2	 	
 
The accompanying notes are an integral part of these consolidated financial statements.

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TRINSEO S.A.
Notes to Consolidated Financial Statements   
(Dollars in millions, unless otherwise stated)
NOTE 1—ORGANIZATION AND BUSINESS ACTIVITIES
Organization
On June 3, 2010, Bain Capital Everest Manager Holding SCA, an affiliate of Bain Capital to which we refer to as the former Parent, was formed through investment funds advised or managed by Bain Capital. Dow Europe Holding B.V. (together with The Dow Chemical Company, “Dow”) retained an indirect ownership interest in the former Parent. Trinseo S.A. (“Trinseo”, and together with its subsidiaries, the “Company”) was also formed on June 3, 2010, incorporated under the existing laws of the Grand Duchy of Luxembourg. At that time, all ordinary shares of Trinseo were owned by the former Parent. On June 17, 2010, Trinseo acquired 100% of the former Styron business from Dow (the “Acquisition”), at which time, the Company commenced operations.
During the year ended December 31, 2016, the former Parent sold 37,269,567 ordinary shares pursuant to the Company’s shelf registration statement filed with the SEC. As such, the former Parent no longer holds an ownership interest in the Company.
Business Activities
The Company is a leading global materials company engaged in the manufacturing and marketing of synthetic rubber, latex binders, and plastics, including various specialty and technologically differentiated products. The Company develops synthetic rubber, latex binders, and plastics products that are incorporated into a wide range of products throughout the world, including tires and other products for automotive applications, carpet and artificial turf backing, coated paper and packaging board, food packaging, appliances, medical devices, consumer electronics and construction applications, among others.
The Company’s operations are located in Europe, North America, and Asia Pacific, supplemented by, Americas Styrenics, a styrenics joint venture with Chevron Phillips Chemical Company LP. Refer to Note 4 for further information regarding our investment in Americas Styrenics.
The Company has significant manufacturing and production operations around the world, which allow service to its global customer base. As of December 31, 2017, the Company’s production facilities included 30 manufacturing plants (which included a total of 75 production units) at 23 sites across 12 countries, including joint ventures and contract manufacturers. Additionally, as of December 31, 2017, the Company operated 11 research and development (R&D) facilities globally, including mini plants, development centers and pilot coaters.
The Company’s chief executive officer, who is the chief operating decision maker, manages the Company’s operations under two divisions, Performance Materials and Basic Plastics & Feedstocks. The Performance Materials division includes the following reportable segments: Latex Binders, Synthetic Rubber, and Performance Plastics. The Basic Plastics & Feedstocks division includes the following reportable segments: Basic Plastics, Feedstocks, and Americas Styrenics.
NOTE 2—BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation and Principles of Consolidation
The accompanying consolidated financial statements as of December 31, 2017 and 2016 and for each of the three years in the period ended December 31, 2017 are prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The consolidated financial statements of the Company contain the accounts of all entities that are controlled and variable interest entities (“VIEs”) for which the Company is the primary beneficiary. A VIE is defined as a legal entity that has equity investors that do not have sufficient equity at risk for the entity to support its activities without additional subordinated financial support or, as a group, the holders of the equity at risk lack (i) the power to direct the entity’s activities or (ii) the obligation to absorb the expected losses or the right to

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receive the expected residual returns of the entity. A VIE is required to be consolidated by a company if that company is the primary beneficiary. Refer to Note 10 for further discussion of the Company’s Accounts Receivable Securitization Facility, which qualifies as a VIE and is consolidated within the Company’s financial statements.
All intercompany balances and transactions are eliminated. Joint ventures over which the Company has the ability to exercise significant influence that are not consolidated are accounted for by the equity method.
Certain prior year amounts have been reclassified to conform to the current year presentation. Effective September 30, 2017, the Company adopted guidance that aims to eliminate diversity in practice for how certain cash receipts and payments are presented and classified in the consolidated statements of cash flows. Refer to the discussion below under “Recent Accounting Guidance” for the impact of this adoption to the Company’s consolidated statement of cash flows for the periods presented herein.
Revisions
In 2017, the Company corrected its accounting related to a contract manufacturing agreement with a customer that had been entered into in conjunction with the Acquisition, in order to properly adjust for an embedded direct financing lease as well as an unfavorable contract liability, which had not been previously identified. As this agreement has been in place since the Acquisition, this correction includes an adjustment to the original purchase price allocation, resulting in an increase to goodwill of $8.5 million. Additional impacts from this adjustment are described below.
The Company assessed the materiality of this correction to prior periods’ financial statements in accordance with SEC Staff Accounting Bulletin No. (SAB) 99, Materiality , and concluded that the corrections were not material to prior periods, either individually or in the aggregate, and therefore, amendments of previously filed reports are not required. Although the corrections were immaterial to prior periods, in accordance with SAB 108, Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements,  the Company has revised its previously reported consolidated financial statements and related notes thereto.
The following table details the effects of these revisions on impacted line items from the Company’s consolidated balance sheet as of December 31, 2016:

 	 	As of December 31, 2016	 	
Balance Sheet Caption	 	As Reported	 	Adjustment	 	As Revised	 	
Property, plant and equipment, net	    	$	513.8	    	$	(3.8)	    	$	510.0	 	
Goodwill	 	 	29.5	 	 	8.5	 	 	38.0	 	
Deferred income tax assets	 	 	40.2	 	 	3.6	 	 	43.8	 	
Deferred charges and other assets	 	 	24.4	 	 	3.5	 	 	27.9	 	
Total other assets	 	 	271.4	 	 	15.6	 	 	287.0	 	
Total assets	 	 	2,409.5	 	 	11.8	 	 	2,421.3	 	
Other noncurrent obligations	 	 	237.1	 	 	9.1	 	 	246.2	 	
Total noncurrent liabilities	 	 	1,422.3	 	 	9.1	 	 	1,431.4	 	
Retained earnings	 	 	258.5	 	 	2.7	 	 	261.2	 	
Total shareholders’ equity	 	 	445.0	 	 	2.7	 	 	447.7	 	
Total liabilities and shareholders’ equity	 	 	2,409.5	 	 	11.8	 	 	2,421.3	 	
The impact of the correction on the Company’s consolidated statements of operations and consolidated statements of cash flows was not significant, and therefore those statements have not been revised herein.
As this error originated in periods prior to those presented, “Accumulated Deficit” as of December 31, 2014 has been reduced from $151.9 million to $149.2 million, and “Accumulated Deficit” as of December 31, 2015 has been reduced from $18.3 million to $15.6 million.
In addition, the Company revised certain previously reported amounts included within Notes 7, 8, 13, and 18 in the consolidated financial statements to correct for the impact of the above adjustments. The Company concluded that its compliance with debt covenants would not have been affected by the adjustments above for any period.

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Use of Estimates in Financial Statement Preparation
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual amounts could differ from these estimates.
 
Concentration of Credit Risk
Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash equivalents and accounts receivable. The Company uses major financial institutions with high credit ratings to engage in transactions involving cash equivalents. The Company minimizes credit risk in its receivables by selling products to a diversified portfolio of customers in a variety of markets located throughout the world.
The Company performs ongoing evaluations of its customers’ credit and generally does not require collateral. The Company maintains an allowance for doubtful accounts for losses resulting from the inability of specific customers to meet their financial obligations, representing our best estimate of probable credit losses in existing trade accounts receivable. A specific reserve for doubtful receivables is recorded against the amount due from these customers. For all other customers, the Company recognizes reserves for doubtful receivables based on historical experience.
 
Financial Instruments
The carrying amounts of the Company’s financial instruments, including cash and cash equivalents, accounts receivable, accounts payable and accrued and other current liabilities, approximate fair value due to their generally short maturities.
The estimated fair value of the Company’s 2024 Term Loan B and 2025 Senior Notes (both of which are defined in Note 10) are determined using Level 2 inputs within the fair value hierarchy. Refer to Note 12 for the fair value of these debt instruments. When outstanding, the estimated fair values of borrowings under the Company’s 2022 Revolving Facility and Accounts Receivable Securitization Facility (both of which are defined in Note 10) are determined using Level 2 inputs within the fair value hierarchy. The carrying amounts of borrowings under the 2022 Revolving Facility and Accounts Receivable Securitization Facility approximate fair value as these borrowings bear interest based on prevailing variable market rates.
At times, the Company manages its exposure to changes in foreign currency exchange rates, where possible, by entering into foreign exchange forward contracts. Additionally, the Company manages its exposure to variability in interest payments associated with the Company’s variable rate debt by entering into interest rate swap agreements. When outstanding, all derivatives, whether designated in hedging relationships or not, are required to be recorded on the consolidated balance sheets at fair value. The fair value of the derivatives is determined from sources independent of the Company, including the financial institutions which are party to the derivative instruments. The fair value of derivatives also considers the credit default risk of the paying party. If the derivative is designated as a fair value hedge, the changes in the fair value of the derivative and the hedged item will be recognized in earnings. If the derivative is designated as a cash flow hedge, the effective portion of the change in the fair value of the derivative will be recorded in other comprehensive income and will be recognized in the consolidated statements of operations when the hedged item affects earnings.
As of December 31, 2017 and 2016, the Company had certain foreign exchange forward contracts outstanding that were not designated for hedge accounting treatment. As such, the settlements and changes in fair value of underlying instruments are recognized in “Other expense (income), net” in the consolidated statements of operations. For the years ended December 31, 2017 and 2015, the Company recognized losses related to these forward contracts of $19.2 million and $16.5 million, respectively, while for the year ended December 31, 2016 the Company recognized gains related to these forward contracts of $3.7 million.
As of December 31, 2017 and 2016, the Company had foreign exchange forward contracts which are designated as cash flow hedges. Additionally, as of December 31, 2017, the Company had interest rate swap agreements designated as cash flow hedges. As such, the qualifying hedge contracts are marked-to-market at each reporting date and any unrealized gains or losses are included in accumulated other comprehensive income or loss, or AOCI, to the extent effective. Amounts are reclassified to “Cost of sales”, in the context of foreign exchange forward contracts, and “Interest expense, net”, in the context of interest rate swap agreements, in the consolidated statements of operations in the period

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during which the transaction affects earnings or it becomes probable that the forecasted transaction will not occur. No interest rate swap agreements were outstanding as of December 31, 2016.
Forward contracts and interest rate swap agreements are entered into with a limited number of counterparties, each of which allows for net settlement of all contracts through a single payment in a single currency in the event of a default on or termination of any one contract. The Company records these foreign exchange forward contracts and interest rate swap agreements on a net basis, by counterparty within the consolidated balance sheets.
As of December 31, 2017, the Company has certain fixed-for-fixed cross currency swaps outstanding, swapping U.S. dollar principal and interest payments on the Company’s 2025 Senior Notes for euro-denominated payments. These cross currency swaps have been designated as a hedge of the Company’s net investment in certain European subsidiaries. As such, to the extent that these cross currency swaps are deemed to be highly effective hedges, changes in their fair value are recorded within the cumulative translation adjustment account as a component of AOCI. The resulting gain or loss will be subsequently reclassified into earnings when the hedged net investment is either sold or substantially liquidated. No cross currency swaps were outstanding as of December 31, 2016.
The Company presents the cash receipts and payments from hedging activities in the same category as the cash flows from the items subject to hedging relationships. As the items subject to economic hedging relationships are the Company’s operating assets and liabilities, the related cash flows are classified within operating activities in the consolidated statements of cash flows.
 
Foreign Currency Translation
For the majority of the Company’s subsidiaries, the local currency has been identified as the functional currency. For remaining subsidiaries, the U.S. dollar has been identified as the functional currency due to the significant influence of the U.S. dollar on their operations. Gains and losses resulting from the translation of various functional currencies into U.S. dollars are not recorded within the consolidated statements of operations. Rather, they are recorded within the cumulative translation adjustment account as a separate component of shareholders’ equity (AOCI) in the consolidated balance sheets. The Company translates asset and liability balances at exchange rates in effect at the end of the period and income and expense transactions at the average exchange rates in effect during the period. Gains and losses resulting from foreign currency transactions are recorded within the consolidated statements of operations.
For the years ended December 31, 2017 and 2015, the Company recognized net foreign exchange transaction gains of $20.6 million and $6.1 million, respectively, while for the year ended December 31, 2016, the Company recognized net foreign exchange transaction losses of $5.5 million. These amounts exclude the impacts of foreign exchange forward contracts discussed above. Gains and losses on net foreign exchange transactions are recorded within “Other expense (income), net” in the consolidated statements of operations.
 
Environmental Matters
Accruals for environmental matters are recorded when it is considered probable that a liability has been incurred and the amount of the liability can be reasonably estimated, based on current law and existing technologies. These accruals are adjusted periodically as assessment and remediation efforts progress, or as additional technical or legal information become available. Accruals for environmental liabilities are recorded within “Other noncurrent obligations” in the consolidated balance sheets at undiscounted amounts. As of December 31, 2017 and 2016, there were no accruals for environmental liabilities recorded.
Environmental costs are capitalized in recognition of legal asset retirement obligations resulting from the acquisition, construction or normal operation of a long-lived asset. Any costs related to environmental contamination treatment and clean-ups are charged to expense. Estimated future incremental operations, maintenance and management costs directly related to remediation are accrued when such costs are probable and reasonably estimable.
 
Cash and Cash Equivalents
Cash and cash equivalents generally include time deposits or highly liquid investments with original maturities of three months or less and no material liquidity fee or redemption gate restrictions.

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Inventories
Inventories are stated at the lower of cost or net realizable value (“NRV”), with cost being determined on the first-in, first-out (“FIFO”) method. NRV is calculated as the estimated selling price less reasonably predictable costs of completion, disposal and transportation. The Company periodically reviews its inventory for excess or obsolete inventory, and will write-down the excess or obsolete inventory value to its net realizable value, if applicable.
 
Property, Plant and Equipment
Property, plant and equipment are carried at cost less accumulated depreciation and less impairment, if applicable, and are depreciated over their estimated useful lives using the straight-line method.
Expenditures for maintenance and repairs are recorded in the consolidated statement of operations as incurred. Expenditures that significantly increase asset value, extend useful asset lives or adapt property to a new or different use are capitalized. These expenditures include planned major maintenance activity or turnaround activities that increase our manufacturing plants’ output and improve production efficiency as compared to pre-turnaround operations. As of December 31, 2017 and 2016, $11.6 million and $9.2 million, respectively, of the Company’s net costs related to turnaround activities were capitalized within “Deferred charges and other assets” in the consolidated balance sheets, and are being amortized over the period until the next scheduled turnaround.
The Company periodically evaluates actual experience to determine whether events and circumstances have occurred that may warrant revision of the estimated useful lives of property, plant and equipment. Engineering and other costs directly related to the construction of property, plant and equipment are capitalized as construction in progress until construction is complete and such property, plant and equipment is ready and available to perform its specifically assigned function. Upon retirement or other disposal, the asset cost and related accumulated depreciation are removed from the accounts and the net amount, less any proceeds, is charged or credited to income. The Company also capitalizes interest as a component of the cost of capital assets constructed for its own use.
 
Impairment and Disposal of Long-Lived Assets
The Company evaluates long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset or asset group may not be recoverable. When undiscounted future cash flows are not expected to be sufficient to recover an asset’s carrying amount, the asset is written down to its fair value based on a discounted cash flow analysis utilizing market participant assumptions. Refer to Note 12 for further information.
Long-lived assets to be disposed of by sale are classified as held-for-sale and are reported at the lower of carrying amount or fair value less cost to sell, and depreciation is ceased. Long-lived assets to be disposed of in a manner other than by sale are classified as held-and-used until they are disposed.
 
Goodwill and Other Intangible Assets
The Company records goodwill when the purchase price of a business acquisition exceeds the estimated fair value of net identified tangible and intangible assets acquired. Goodwill is tested for impairment at the reporting unit level annually, or more frequently when events or changes in circumstances indicate that the fair value of a reporting unit has more likely than not declined below its carrying value. The Company utilizes a market approach and an income approach (under the discounted cash flow method) to calculate the fair value of its reporting units. When supportable, the Company employs the qualitative assessment of goodwill impairment prescribed by ASC 350. The annual impairment assessment is completed using a measurement date of October 1 st . No goodwill impairment losses were recorded in the years ended December 31, 2017, 2016, and 2015.
Finite-lived intangible assets, such as developed technology, customer relationships, manufacturing capacity rights, and computer software for internal use are amortized on a straight-line basis over their estimated useful life and are reviewed for impairment or obsolescence if events or changes in circumstances indicate that their carrying amount may not be recoverable. If impaired, intangible assets are written down to fair value based on discounted cash flows. No intangible asset impairment losses were recorded in the years ended December 31, 2017, 2016, and 2015.
Acquired developed technology is recorded at fair value upon acquisition and is amortized using the straight-line method over the estimated useful life ranging from 9 years to 15 years. We determine amortization periods for developed

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technology based on our assessment of various factors impacting estimated useful lives and timing and extent of estimated cash flows of the acquired assets. This includes estimates of expected period of future economic benefit and competitive advantage related to existing processes and procedures at the date of acquisition. Significant changes to any of these factors may result in a reduction in the useful life of these assets.
Customer relationships are recorded at fair value upon acquisition and are amortized using the straight-line method over the estimated useful life of 19 years. We determine amortization periods for customer relationships based on our assessment of various factors impacting estimated useful lives and timing and extent of estimated cash flows of the acquired assets. This includes estimates of expected period of future economic benefit and customer retention rates. Significant changes to any of these factors may result in a reduction in the useful life of these assets.
Investments in Unconsolidated Affiliates
Investments in unconsolidated affiliates in which the Company has the ability to exercise significant influence (generally, 20% to 50%-owned companies) are accounted for using the equity method. Investments are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of the investment may not be recoverable. An impairment loss is recorded whenever a decline in fair value of an investment in an unconsolidated affiliate below its carrying amount is determined to be other-than-temporary.
As discussed below, in conjunction with the adoption of new cash flow guidance that aims to eliminate diversity in practice for how certain cash receipts and payments are presented and classified in the consolidated statements of cash flows, the Company made an accounting policy election to use the cumulative earnings approach for presenting distributions received from equity method investees, which is consistent with its existing approach.
Deferred Financing Fees
Capitalized fees and costs incurred in connection with the Company’s recognized debt liabilities are presented in the consolidated balance sheets as a direct reduction from the carrying value of those debt liabilities, consistent with debt discounts. Deferred financing fees related to the Company’s revolving debt facilities are included within “Deferred charges and other assets” in the consolidated balance sheets.
For the 2024 Term Loan B and 2025 Senior Notes (and the 2021 Term Loan B and 2022 Senior Notes, prior to their repayment in September 2017), deferred financing fees are amortized over the term of the agreement using the effective interest method, while for the 2022 Revolving Facility and the Accounts Receivable Securitization Facility, deferred financing fees are amortized using the straight-line method over the term of the respective facility. Amortization of deferred financing fees is recorded in “Interest expense, net” within the consolidated statements of operations.
 
Sales
Sales are recognized when the revenue is realized or realizable and the earnings process is complete, which occurs when risk and title to the product transfers to the customer, typically at the time shipment is made. As such, title to the product generally passes when the product is delivered to the freight carrier. Standard terms of delivery are included in contracts of sale, order confirmation documents and invoices. Taxes on sales are excluded from net sales.
Sales are recorded net of estimates for returns and price allowances, including discounts for prompt payment and volume-based incentives.
 
Cost of Sales
The Company classifies the costs of manufacturing and distributing its products as cost of sales. Manufacturing costs include raw materials, utilities, packaging, employee salary and benefits and fixed manufacturing costs associated with production. Fixed manufacturing costs include such items as plant site operating costs and overhead, production planning, depreciation and amortization, repairs and maintenance, environmental, and engineering costs. Distribution costs include shipping and handling costs. Freight and any directly related costs of transporting finished products to customers are also included within cost of sales. As discussed above, inventory costs are recorded within cost of sales utilizing the FIFO method.

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Selling, General and Administrative Expenses
Selling, general and administrative, or SG&A, expenses are generally charged to expense as incurred. SG&A expenses are the cost of services performed by the marketing and sales functions (including sales managers, field sellers, marketing research, marketing communications and promotion and advertising materials) and by administrative functions (including product management, R&D, business management, customer invoicing, human resources, information technology, legal and finance services, such as accounting and tax). Salary and benefit costs, including stock-based compensation, for these sales personnel and administrative staff are included within SG&A expenses. R&D expenses include the cost of services performed by the R&D function, including technical service and development, process research including pilot plant operations, and product development. The Company also includes restructuring charges within SG&A expenses.
Total R&D costs included in SG&A expenses were $51.9 million, $51.0, million and $51.9 million for the years ended December 31, 2017, 2016, and 2015, respectively.
The Company expenses promotional and advertising costs as incurred to SG&A expenses. Total promotional and advertising expenses were $1.5 million, $3.0 million, and $3.5 million for the years ended December 31, 2017, 2016, and 2015, respectively.
Restructuring charges included within SG&A expenses were $8.0 million, $23.9 million and $8.2 million for the years ended December 31, 2017, 2016, and 2015, respectively. Refer to Note 19 for further information.
 
Pension and Postretirement Benefits Plans
The Company has several defined benefit plans, under which participants earn a retirement benefit based upon a formula set forth in the plan. The Company also provides certain health care and life insurance benefits to retired employees mainly in the United States. Prior to the divestiture of our latex binders and automotive businesses in Brazil (refer to Note 3) we also provided health care and life insurance benefits to retired employees in Brazil. The U.S.-based plan provides health care benefits, including hospital, physicians’ services, drug and major medical expense coverage, and life insurance benefits.
Accounting for defined benefit pension plans and other postretirement benefit plans, and any curtailments and settlements thereof, requires various assumptions, including, but not limited to, discount rates, expected rates of return on plan assets and future compensation growth rates. The Company evaluates these assumptions at least once each year, or as facts and circumstances dictate, and makes changes as conditions warrant.
In 2016, the Company changed the method used to estimate the future service and interest cost components of net periodic benefit cost for our defined benefit pension and other postretirement benefit plans. As a result, beginning in 2017, the Company employed a full yield curve approach in the estimation of these components of benefit cost by applying the specific spot rates along the yield curve used in the determination of the benefit obligation to the relevant projected cash flows.
A settlement is a transaction that is an irrevocable action that relieves the employer (or the plan) of primary responsibility for a pension or postretirement benefit obligation, and that eliminates significant risks related to the obligation and the assets used to effect the settlement. When a settlement occurs, the Company does not record settlement gains or losses during interim periods when the cost of all settlements in a year is less than or equal to the sum of the service cost and interest cost components of net periodic benefit cost for the plan in that year.
 
Income Taxes
The provision for income taxes is determined using the asset and liability approach of accounting for income taxes. Under this approach, deferred taxes represent the future tax consequences expected to occur when the reported amounts of assets and liabilities are recovered or paid. The provision for income taxes represents income taxes paid or payable for the current year plus the change in deferred taxes during the year. Deferred taxes result from differences between the financial and tax basis of the Company’s assets and liabilities and are adjusted for changes in tax rates and tax laws when changes are enacted. For each tax jurisdiction in which the Company operates, deferred tax assets and liabilities are offset against one another and are presented as a single noncurrent amount within the consolidated balance sheets.

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Valuation allowances are recorded to reduce deferred tax assets when it is more likely than not that a tax benefit will not be realized. Provision is made for income taxes on unremitted earnings of subsidiaries and affiliates, unless such earnings are deemed to be indefinitely invested.
The Company recognizes the financial statement effects of uncertain income tax positions when it is more likely than not, based on the technical merits, that the position will be sustained upon examination. The Company accrues for other tax contingencies when it is probable that a liability to a taxing authority has been incurred and the amount of the contingency can be reasonably estimated. Interest accrued related to unrecognized tax and income tax related penalties are included in the provision for income taxes. The current portion of uncertain income taxes positions is recorded in “Income taxes payable” while the long-term portion is recorded in “Other noncurrent obligations” in the consolidated balance sheets.
 
Stock-based Compensation
Refer to Note 16 for detailed discussion regarding the Company’s stock-based compensation award programs. In connection with the Company’s initial public offering (“IPO”), the Company’s board of directors approved the 2014 Omnibus Plan. Since that time, certain equity grants have been awarded, comprised of restricted share units (“RSUs”), option awards, and performance share units (“PSUs”). Stock-based compensation expense recognized in our consolidated financial statements is based on awards that are ultimately expected to vest. The Company’s policy election is to recognize forfeitures as incurred, rather than estimating forfeitures in advance.
Compensation costs for the RSUs are measured at the grant date based on the fair value of the award and are recognized ratably as expense over the applicable vesting term. The fair value of RSUs is equal to the fair market value of the Company’s ordinary shares based on the closing price on the date of grant. Dividend equivalents will accumulate on RSUs during the vesting period, and will be payable in cash and will not accrue interest. Award holders have no right to receive the dividend equivalents unless and until the associated RSUs vest.
Compensation costs for the option awards are measured at the grant date based on the fair value of the award and is recognized as expense over the appropriate service period utilizing graded vesting. The fair value for option awards is computed using the Black-Scholes pricing model, whose inputs and assumptions are determined as of the date of grant.
Compensation costs for the PSUs are measured at the grant date based on the fair value of the award, which is computed using a Monte Carlo valuation model, and is recognized ratably as expense over the applicable vesting term. Dividend equivalents will accumulate on PSUs during the vesting period, and will be payable in cash and will not accrue interest. Award holders have no right to receive the dividend equivalents unless and until the associated PSUs vest.
 
Treasury Shares
The Company may, from time to time, repurchase its ordinary shares at prevailing market rates. Share repurchases are recorded at cost within “Treasury shares” within shareholders’ equity in the consolidated balance sheets. It is the Company’s policy that, as RSUs, PSUs, and option awards vest or are exercised, ordinary shares will be issued from the existing pool of treasury shares on a first-in-first-out basis. Refer to Note 16 for details of vesting for RSUs and PSUs as well as the exercises of option awards.
 
Recent Accounting Guidance
In May 2014, the Financial Accounting Standards Board (“FASB”) and the International Accounting Standards Board (“IASB”) jointly issued guidance which clarifies the principles for recognizing revenue and develops a common revenue standard for GAAP and International Financial Reporting Standards (“IFRS”). The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Additionally, the FASB has issued certain clarifying updates to this guidance, which the Company has considered as part of our adoption, which is effective as of January 1, 2018. The Company has completed its scoping assessment for the adoption of this guidance by conducting surveys with relevant stakeholders in the business, including commercial and finance leadership, reviewing a representative sample of revenue arrangements across all businesses, and identifying potential qualitative revenue recognition changes related to the new standard update. In completing this phase, the Company identified its major revenue streams, which are concentrated within individual product sales within

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each of our reportable segments. As a result of this work, the Company concluded that it will adopt this new guidance applying the modified retrospective approach. In addition, the Company has established key accounting policies and evaluated impacts on business processes, information technology, and controls resulting from the adoption of this new standard. Additionally, the Company does not expect the impacts of adoption will have a material impact on its consolidated financial statements. The Company remains in the process of assessing new disclosure requirements under this standard, which will be included in the Company’s quarterly report on Form 10-Q for the quarter ended March 31, 2018.
In July 2015, the FASB issued guidance which simplifies the subsequent measurement of inventory by replacing the lower of cost or market test with a lower of cost or net realizable value (“NRV”) test. NRV is calculated as the estimated selling price less reasonably predictable costs of completion, disposal and transportation. The Company adopted this guidance effective January 1, 2017, and the adoption did not have a material impact on the Company’s financial position or results of operations.
In February 2016, the FASB issued guidance related to leases that outlines a comprehensive lease accounting model and supersedes the current lease guidance. The new guidance requires lessees to recognize on the consolidated balance sheets lease liabilities and corresponding right-of-use assets for all leases with terms of greater than 12 months. It also changes the definition of a lease and expands the disclosure requirements of lease arrangements. This new guidance is effective for public companies for annual and interim periods beginning after December 15, 2018, with early adoption permitted. The new guidance must be adopted using a modified retrospective transition, and provides for certain practical expedients. The Company is in the process of assessing the impact on its consolidated financial statements from the adoption of the new guidance. However, as we are the lessee under various real estate, railcar, and other equipment leases, which we currently account for as operating leases, we anticipate an increase in the recognition of right-of-use assets and lease liabilities as a result of this adoption .  
In August 2016, the FASB issued guidance that aims to eliminate diversity in practice for how certain cash receipts and payments are presented and classified in the consolidated statements of cash flows. Additionally, the FASB has issued further guidance related to the presentation of restricted cash on the consolidated statement of cash flows. The Company adopted this guidance effective September 30, 2017 on a retrospective basis and the consolidated statements of cash flows for the periods presented herein reflect this adoption. The most significant impact of this adoption to the Company was the requirement to classify debt prepayment or extinguishment costs, which the Company had historically classified within cash flows from operating activities, as financing cash outflows. For the years ended December 31, 2017 and 2015, respectively, $53.0 million and $68.6 million of debt prepayment penalties are reflected as financing cash outflows. No debt prepayment penalties were incurred during the year ended December 31, 2016. Additionally, in conjunction with this adoption, the Company made an accounting policy election to use the cumulative earnings approach for presenting distributions received from equity method investees, which is consistent with its existing approach.
In January 2017, the FASB issued guidance that revises the definition of a business in order to assist in determining whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. Under the new guidance, fewer transactions are expected to be accounted for as business combinations. The Company adopted this guidance during the first quarter of 2017. We expect this adoption could affect conclusions reached for future transactions in several areas, including acquisitions and disposals.
In January 2017, the FASB issued guidance to simplify the accounting for goodwill impairment by removing Step 2 of the test, which requires a hypothetical purchase price allocation. As a result, a goodwill impairment will now be the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. The Company adopted this guidance during the first quarter of 2017, which did not have a material impact to the Company’s financial position or results of operations.
In March 2017, the FASB issued guidance that requires employers to present the service cost component of net periodic benefit cost in the same statement of operations line item as other employee compensation costs arising from services rendered during the period. The other components of net periodic benefit cost are to be presented outside of any subtotal of operating income. The Company adopted this guidance effective January 1, 2018 on a retrospective basis. As a result of this adoption, in future filings, the Company will reclassify approximately $13.7 million of net periodic benefit income for the year ended December 31, 2017 and $7.4 million of net periodic benefit cost for the year ended

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December 31, 2016 from “Cost of sales” and “Selling, general and administrative expenses”, collectively, to “Other expense (income), net” within the consolidated statements of operations.
In August 2017, the FASB issued significant amendments to existing hedge accounting guidance. Among other things, this guidance will make more financial and nonfinancial hedging strategies eligible for hedge accounting, amend presentation and disclosure requirements, and change how companies assess effectiveness. This guidance is required for public companies for annual and interim periods beginning after December 15, 2018, with early adoption permitted. The Company is currently assessing the timing and related impact of adopting this guidance on its financial position and results of operations.
In February 2018, the FASB issued guidance to address certain stranded income tax effects in AOCI resulting from the enactment of the U.S. “Tax Cuts and Jobs Act” signed into law on December 22, 2017. The amendment provides financial statement preparers with an option to reclassify stranded tax effects within AOCI, resulting from the reduction of the U.S. federal corporate income tax rate, to retained earnings. The amendment also includes disclosure requirements regarding the Company’s accounting policy for releasing income tax effects from AOCI. The amendment is effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2018. Early adoption is permitted, and the provisions of the amendment should be applied either in the period of adoption or retrospectively to each period in which the effect of the change in the U.S. federal corporate income tax rate in the “Tax Cuts and Jobs Act” is recognized. While the Company is still evaluating the provisions of this amendment, should the Company choose to adopt this guidance, it is not expected to have a material impact on the Company’s consolidated financial statements.
NOTE 3—ACQUISITIONS AND DIVESTITURES
The Acquisition
The Company accounted for the Acquisition (as discussed in Note 1) under the purchase method of accounting, whereby the purchase price paid, net of working capital adjustments, was allocated to the acquired assets and liabilities at fair value.
As part of the Acquisition, the Company has been indemnified for various tax matters, including income tax and value add taxes, as well as legal liabilities which have been incurred prior to the Acquisition. Conversely, certain tax matters which the Company has benefitted from are subject to reimbursement by Trinseo to Dow. These amounts have been estimated and provisional amounts have been recorded based on the information known during the measurement period; however, these amounts remain subject to change based on the completion of our annual statutory filings, tax authority review as well as a final resolution with Dow on amounts due to and due from the Company. Management believes the Company’s estimates and assumptions are reasonable under the circumstances, however, settlement negotiations or changes in estimates around pre-acquisition indemnifications could result in a material impact on the consolidated financial statements.
Acquisition of API Plastics
On July 10, 2017, the Company acquired 100% of the equity interest of API Applicazioni Plastiche Industriali S.p.A, or API Plastics, a privately held company. The gross purchase price for the acquisition was $90.6 million, inclusive of $8.4 million of cash acquired, yielding a net purchase price of $82.3 million, all of which was paid for in the year ended December 31, 2017. API Plastics, based in Mussolente, Italy, is a manufacturer of soft-touch polymers and bioplastics, such as thermoplastic elastomers (“TPEs”). TPEs can be molded over rigid plastics such as ABS and PC/ABS, which presents opportunities for complementary technology product offerings within our Performance Plastics segment. The acquisition was funded through existing cash on hand.
The Company allocated the purchase price of the acquisition to identifiable assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date. The excess of the purchase price over the aggregate fair values was recorded as goodwill. The Company calculated the fair value of the assets acquired using the income and cost approaches (or a combination thereof). Fair values were determined based on Level 3 inputs including estimated future cash flows, discount rates, royalty rates, growth rates, sales projections, retention rates and terminal values, all of which require significant management judgment.
The purchase price allocation is based upon preliminary information and is subject to change if additional

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information about the facts and circumstances that existed at the acquisition date becomes available. Additional information is being gathered to finalize these preliminary measurements, particularly with respect to property, plant and equipment, intangible assets, inventory, deferred income taxes and income taxes payable. Further adjustments may be necessary as a result of the Company’s on-going assessment of additional information related to the fair value of assets acquired and liabilities assumed, including goodwill, during the measurement period.
The following table summarizes the preliminary fair value measurement of the assets acquired and liabilities assumed as of the date of acquisition:

 	 	July 10,	 	
 	    	2017	 	
Cash and cash equivalents	 	$	8.4	 	
Accounts receivable	 	 	16.5	 	
Inventories	 	 	10.3	 	
Other current assets	 	 	0.8	 	
Property, plant, and equipment	 	 	23.3	 	
Other intangible assets (1)	 	 	 	 	
Customer relationships	 	 	14.0	 	
Developed technology	 	 	11.5	 	
Other amortizable intangible assets	 	 	3.5	 	
Total fair value of assets acquired	 	$	88.3	 	
 	 	 	 	 	
Accounts payable	 	$	12.2	 	
Income taxes payable	 	 	0.2	 	
Accrued expenses and other current liabilities	 	 	1.4	 	
Deferred income tax liabilities	 	 	11.3	 	
Other noncurrent obligations	 	 	1.3	 	
Total fair value of liabilities assumed	 	$	26.4	 	
Net identifiable assets acquired	 	$	61.9	 	
Goodwill (2)	 	 	28.7	 	
Net assets acquired	 	$	90.6	 	

	(1)		The expected lives of the acquired intangible assets are 19 years for customer relationships, 9 years for developed technology, and 3 years for other amortizable intangible assets.	
	(2)		Goodwill consists of expected operating synergies resulting from combining API Plastics with our existing businesses, and is allocated entirely to the Performance Plastics segment. None of the goodwill related to this acquisition will be deductible for income tax purposes.	
 
During the year ended December 31, 2017, transaction and integration costs related to advisory and professional fees incurred in conjunction with the API Plastics acquisition were $3.4 million, and were included within “Selling, general and administrative expenses” in the consolidated statement of operations. Additionally, during the year ended December 31, 2017, the Company recorded a $1.3 million non-cash fair value inventory adjustment related to the API Plastics acquisition which was included within “Cost of sales” in the consolidated statement of operations when the acquired inventory was sold.
Pro forma results of operations information has not been presented, as the effect of the API Plastics acquisition is not material. The operating results of API Plastics are included within the Company's consolidated statement of operations since the acquisition date of July 10, 2017 and were not material to the Company's results for the year ended December 31, 2017.
Divestiture of Brazil Business
During the second quarter of 2016, the Company signed a definitive agreement to sell Trinseo do Brasil Comercio de Produtos Quimicos Ltda. (“Trinseo Brazil”), its primary operating entity in Brazil which includes both a latex binders

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and automotive business. Under the agreement of sale, which closed on October 1, 2016, Trinseo Brazil was sold to a single counterparty, for a selling price that is subject to certain contingent consideration payments, which could be paid by the buyer over a 5-year period subsequent to the closing date, based on the results of the Trinseo Brazil latex binders business during that time.
As a result of this agreement, during the year ended December 31, 2016, the Company recorded impairment charges for the estimated loss on sale of approximately $15.1 million within “Other expense (income), net” in the consolidated statement of operations. The $15.1 million charge primarily relates to the unrecoverable net book value of property, plant and equipment along with certain working capital balances, and also includes $0.4 million of goodwill written off with the sale (entirely attributable to the Latex Binders segment).  This charge has been allocated as $9.4 million, $4.9 million, and $0.7 million to the Performance Plastics segment, Latex Binders segment, and Corporate, respectively. During the years ended December 31, 2017 and 2016, the Company has received $1.7 million and $1.8 million in proceeds from the sale of these businesses, respectively.
The results of operations associated with the latex binders and automotive businesses of Trinseo Brazil were not classified as discontinued operations as the decision to divest these businesses does not represent a strategic shift that has, or will have, a major effect on the Company’s financial position or results of operations.
NOTE 4—INVESTMENTS IN UNCONSOLIDATED AFFILIATES
During the year ended December 31, 2017, the Company had two joint ventures: Americas Styrenics, a styrene and polystyrene joint venture with Chevron Phillips Chemical Company LP, and Sumika Styron Polycarbonate, a polycarbonate joint venture with Sumitomo Chemical Company Limited. The results of Americas Styrenics are included within its own reporting segment, and the results of Sumika Styron Polycarbonate were included within the Basic Plastics reporting segment until the Company sold its 50% share of the entity in January 2017. Refer to the discussion below for further information about the sale of the Company’s share in Sumika Styron Polycarbonate during the first quarter of 2017.
Equity in earnings from unconsolidated affiliates was $123.7 million, $144.7 million and $140.2 million for the years ended December 31, 2017, 2016, and 2015, respectively.
Both of the unconsolidated affiliates are privately held companies; therefore, quoted market prices for their stock are not available. The summarized financial information of the Company’s unconsolidated affiliates is shown below. This table includes summarized financial information for Sumika Styron Polycarbonate through the date of sale in January 2017.

 	 	December 31,	 	
 	 	2017	 	2016	 	
Current assets	    	$	364.0	    	$	457.9	 	
Noncurrent assets	 	 	236.2	 	 	269.6	 	
Total assets	 	$	600.2	 	$	727.5	 	
Current liabilities	 	$	184.3	 	$	207.8	 	
Noncurrent liabilities	 	 	17.9	 	 	31.4	 	
Total liabilities	 	$	202.2	 	$	239.2	 	

 	 	 	 	 	 	 	 	 	 	 	
 	 	Year Ended	 	
 	 	December 31, 	 	
 	    	2017	    	2016	    	2015	 	
Sales	 	$	1,798.1	    	$	1,649.4	 	$	1,753.5	 	
Gross profit	 	$	243.6	 	$	318.5	 	$	318.1	 	
Net income	 	$	196.3	 	$	249.2	 	$	250.1	 	

Sales to unconsolidated affiliates for the years ended December 31, 2017, 2016, and 2015 were $3.6 million, $4.2 million and $2.5 million, respectively. Purchases from unconsolidated affiliates were $78.8 million, $157.4 million and $178.4 million for the years ended December 31, 2017, 2016 and 2015, respectively.

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As of December 31, 2017 and 2016, respectively, $0.1 million and $0.7 million due from unconsolidated affiliates was included in “Accounts receivable, net of allowance” and $4.7 million and $16.3 million due to unconsolidated affiliates was included in “Accounts payable” in the consolidated balance sheets.
Americas Styrenics
As of December 31, 2017 and 2016, respectively, the Company’s investment in Americas Styrenics was $152.5 million and $149.7 million, which was $46.4 million and $71.2 million less than the Company’s 50% share of Americas Styrenics’ underlying net assets. These amounts represent the difference between the book value of assets contributed to the joint venture at the time of formation (May 1, 2008) and the Company’s 50% share of the total recorded value of the joint venture’s assets and certain adjustments to conform with the Company’s accounting policies. This difference is being amortized over a weighted average remaining useful life of the contributed assets of approximately 2.8 years as of December 31, 2017. The Company received dividends from Americas Styrenics of $120.0 million, $130.0 million, and $125.0 million for the years ended December 31, 2017, 2016, and 2015, respectively.
Sumika Styron Polycarbonate
On January 31, 2017, the Company completed the sale of its 50% share in Sumika Styron Polycarbonate to Sumitomo Chemical Company Limited for total sales proceeds of approximately $42.1 million. As a result, the Company recorded a gain on sale of $9.3 million during the year ended December 31, 2017, which was included within “Other expense (income), net” in the consolidated statement of operations and was allocated entirely to the Basic Plastics segment. In addition, the parties have entered into a long-term agreement to continue sourcing polycarbonate resin from Sumika Styron Polycarbonate to the Company’s Performance Plastics segment.
As of December 31, 2016, the Company’s investment in Sumika Styron Polycarbonate was $41.7 million. Due to the sale in January 2017, the Company no longer has an investment in Sumika Styron Polycarbonate as of December 31, 2017. The Company received dividends from Sumika Styron Polycarbonate of $9.8 million and $6.2 million for the years ended December 31, 2017 and 2016, respectively. The Company received no dividends from Sumika Styron Polycarbonate for the year ended December 31, 2015.
NOTE 5—ACCOUNTS RECEIVABLE
Accounts receivable consisted of the following:

 	 	December 31,	 	
 	 	2017	 	2016	 	
Trade receivables	    	$	570.3	    	$	479.3	 	
Non-income tax receivables	 	 	79.3	 	 	55.2	 	
Other receivables	 	 	41.5	 	 	33.0	 	
Less: allowance for doubtful accounts	 	 	(5.6)	 	 	(3.1)	 	
Total	 	$	685.5	 	$	564.4	 	
 
The allowance for doubtful accounts was approximately $5.6 million and $3.1 million as of December 31, 2017 and 2016, respectively. For the years ended December 31, 2017, 2016, and 2015, respectively, the Company recognized bad debt expense of $1.5 million, $1.0 million, and $0.3 million.
NOTE 6—INVENTORIES
Inventories consisted of the following:

 	 	December 31, 	 	
 	    	2017	    	2016	 	
Finished goods	    	$	250.9	    	$	187.5	 	
Raw materials and semi-finished goods	 	 	226.7	 	 	168.8	 	
Supplies	 	 	32.8	 	 	29.0	 	
Total	 	$	510.4	 	$	385.3	 	

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NOTE 7—PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment consisted of the following:

 	 	Estimated Useful	 	December 31,	 	
 	 	Lives (Years)	 	2017	 	2016	 	
Land	    	Not applicable	    	$	40.8	    	$	35.0	 	
Land and waterway improvements	 	 1	-	20	 	 	16.4	 	 	14.6	 	
Buildings	 	 2	-	40	 	 	87.9	 	 	57.1	 	
Machinery and equipment (1)	 	 1	-	20	 	 	874.5	 	 	659.6	 	
Utility and supply lines	 	 1	-	10	 	 	8.1	 	 	7.3	 	
Leasehold interests	 	 1	-	45	 	 	41.9	 	 	39.2	 	
Other property	 	 1	-	 8	 	 	25.1	 	 	27.0	 	
Construction in process	 	Not   applicable	 	 	56.0	 	 	83.1	 	
Property, plant and equipment	 	 	 	 	 	 	1,150.7	 	 	922.9	 	
Less: accumulated depreciation	 	 	 	 	 	 	(523.7)	 	 	(412.9)	 	
Property, plant and equipment, net	 	 	 	 	 	$	627.0	 	$	510.0	 	

	(1)		Approximately 95% of our machinery and equipment had a useful life of three to ten years as of December 31, 2017 and 2016.	

 	 	 	 	 	 	 	 	 	 	 	
 	 	Year Ended	 	
 	 	December 31,	 	
 	 	2017	 	2016	 	2015	 	
Depreciation expense	    	$	77.9	    	$	71.3	    	$	74.9	 	
Capitalized interest	 	$	5.0	 	$	3.4	 	$	3.9	 	
 
NOTE 8—GOODWILL AND INTANGIBLE ASSETS
Goodwill
The following table shows changes in the carrying amount of goodwill, by segment, from December 31, 2015 to December 31, 2016 and from December 31, 2016 to December 31, 2017, respectively:

 	 	Performance Materials	 	Basic Plastics & Feedstocks	 	 	 	 	
 	 	Latex	 	Synthetic	 	Performance	 	Basic	 	 	 	Americas	 	 	 	 	
 	    	Binders	    	Rubber	    	Plastics	    	Plastics	    	Feedstocks	    	Styrenics	    	Total	 	
Balance at December 31, 2015	    	$	15.7	 	$	10.9	 	$	5.6	 	$	7.4	 	$	 —	 	$	 —	 	$	39.6	 	
Acquisitions/Divestitures (Note 3)	 	 	(0.4)	 	 	 —	 	 	 —	 	 	 —	 	 	 —	 	 	 —	 	 	(0.4)	 	
Foreign currency impact	 	 	(0.5)	 	 	(0.3)	 	 	(0.2)	 	 	(0.2)	 	 	 —	 	 	 —	 	 	(1.2)	 	
Balance at December 31, 2016	 	$	14.8	 	$	10.6	 	$	5.4	 	$	7.2	 	$	 —	 	$	 —	 	$	38.0	 	
Acquisitions/Divestitures (Note 3)	 	 	 —	 	 	 —	 	 	28.7	 	 	 —	 	 	 —	 	 	 —	 	 	28.7	 	
Foreign currency impact	 	 	1.7	 	 	1.1	 	 	2.3	 	 	0.7	 	 	 —	 	 	 —	 	 	5.8	 	
Balance at December 31, 2017	 	$	16.5	 	$	11.7	 	$	36.4	 	$	7.9	 	$	 —	 	$	 —	 	$	72.5	 	
Goodwill impairment testing is performed annually as of October 1st. In 2017, the Company performed its annual impairment test for goodwill and determined that the estimated fair value of each reporting unit was in excess of the carrying value indicating that none of the Company’s goodwill was impaired. The Company concluded there were no goodwill impairments or triggering events for the years ended December 31, 2017, 2016, and 2015.

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Other Intangible Assets
The following table provides information regarding the Company’s other intangible assets as of December 31, 2017 and 2016, respectively:

 	 	 	 	December 31, 2017	 	December 31, 2016	 	
 	 	Estimated	 	Gross	 	 	 	 	 	 	 	Gross	 	 	 	 	 	 	 	
 	 	Useful Life	 	Carrying	 	Accumulated	 	 	 	 	Carrying	 	Accumulated	 	 	 	 	
 	   	(Years)	   	Amount	   	Amortization	   	Net	   	Amount	   	Amortization	   	Net	 	
Developed technology (1)	 	9 - 15	 	$	201.6	 	$	(96.1)	 	$	105.5	 	$	166.2	 	$	(72.2)	 	$	94.0	 	
Customer Relationships (1)	 	19	 	 	14.7	 	 	(0.4)	 	 	14.3	 	 	 —	 	 	 —	 	 	 —	 	
Manufacturing Capacity Rights	 	 6	 	 	22.8	 	 	(13.9)	 	 	8.9	 	 	20.0	 	 	(8.9)	 	 	11.1	 	
Software	 	5 - 10	 	 	89.5	 	 	(25.2)	 	 	64.3	 	 	82.3	 	 	(15.1)	 	 	67.2	 	
Software in development	 	N/A	 	 	11.5	 	 	 —	 	 	11.5	 	 	4.8	 	 	 —	 	 	4.8	 	
Other (1)	 	 3	 	 	3.4	 	 	(0.4)	 	 	3.0	 	 	0.2	 	 	 —	 	 	0.2	 	
Total	 	 	 	$	343.5	 	$	(136.0)	 	$	207.5	 	$	273.5	 	$	(96.2)	 	$	177.3	 	

	(1)		Balances as of December 31, 2017 include assets acquired related to the acquisition of API Plastics. Refer to Note 3 for further information.	
During 2016, the Company completed an upgrade of our legacy ERP environment to the latest version of SAP. The total amount of capitalized software related to this project was $57.4 million, which is being amortized over its estimated useful life of approximately 9 years.
Amortization expense related to finite-lived intangible assets totaled $27.0 million, $21.3 million, and $18.5 million, for the years ended December 31, 2017, 2016, and 2015, respectively.
The following table details the Company’s estimated amortization expense for the next five years, excluding any amortization expense related to software currently in development:

Estimated Amortization Expense for the Next Five Years	 	
2018	 	2019	 	2020	 	2021	 	2022	 	
$	29.7	    	$	29.5	    	$	25.9	    	$	23.1	    	$	22.2	 	
 
NOTE 9—ACCOUNTS PAYABLE
Accounts payable consisted of the following:

 	 	December 31,	 	
 	 	2017	 	2016	 	
Trade payables	    	$	387.3	    	$	341.9	 	
Other payables	 	 	49.5	 	 	36.1	 	
Total	 	$	436.8	 	$	378.0	 	

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NOTE 10—DEBT
Refer to discussion below for details and definitions of the Company’s debt facilities, as well as details of the Company’s debt refinancing that occurred during the third quarter of 2017. The Company was in compliance with all debt related covenants as of December 31, 2017 and 2016.

 	 	 	 	 	 	December 31, 2017	 	
 	 	Interest Rate as of December 31, 2017	    	Maturity
Date	    	Carrying
Amount	    	Unamortized
Deferred
Financing
Fees (1)	    	Total Debt,
Less
Unamortized
Deferred
Financing
Fees	    	
Senior Credit Facility	 	 	 	 	 	 	 	 	 	 	 	    	 	 	
2022 Revolving Facility (2)	 	Various	 	September 2022	 	$	 —	 	$	 —	 	$	 —	 	
2024 Term Loan B	 	4.069%	 	September 2024	 	 	698.3	 	 	(18.3)	 	 	680.0	 	
2025 Senior Notes	 	5.375%	 	September 2025	 	 	500.0	 	 	(9.4)	 	 	490.6	 	
Accounts Receivable Securitization Facility (3)	 	Various	 	May 2019	 	 	 —	 	 	 —	 	 	 —	 	
Other indebtedness	 	Various	 	Various	 	 	1.4	 	 	 —	 	 	1.4	 	
Total debt	 	 	 	 	 	$	1,199.7	 	$	(27.7)	 	$	1,172.0	 	
Less: current portion	 	 	 	 	 	 	 	 	 	 	 	 	(7.0)	 	
Total long-term debt, net of unamortized deferred financing fees	 	 	 	 	 	 	 	 	 	 	 	$	1,165.0	 	

 	 	 	 	 	 	December 31, 2016	 	
 	 	Interest Rate as of December 31, 2016	    	Maturity
Date	    	Carrying
Amount	    	Unamortized
Deferred
Financing
Fees (1)	    	Total Debt,
Less
Unamortized
Deferred
Financing
Fees	    	
2020 Senior Credit Facility	 	 	 	 	 	 	 	 	 	 	 	    	 	 	
2020 Revolving Facility	 	Various	 	May 2020	 	$	 —	 	$	 —	 	$	 —	 	
2021 Term Loan B	 	4.250%	 	November 2021	 	 	491.5	 	 	(9.2)	 	 	482.3	 	
2022 Senior Notes	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
USD Notes	 	6.750%	 	May 2022	 	 	300.0	 	 	(5.7)	 	 	294.3	 	
Euro Notes	 	6.375%	 	May 2022	 	 	394.3	 	 	(7.1)	 	 	387.2	 	
Accounts Receivable Securitization Facility	 	Various	 	May 2019	 	 	 —	 	 	 —	 	 	 —	 	
Other indebtedness	 	Various	 	Various	 	 	1.6	 	 	 —	 	 	1.6	 	
Total debt	 	 	 	 	 	$	1,187.4	 	$	(22.0)	 	$	1,165.4	 	
Less: current portion	 	 	 	 	 	 	 	 	 	 	 	 	(5.0)	 	
Total long-term debt, net of unamortized deferred financing fees	 	 	 	 	 	 	 	 	 	 	 	$	1,160.4	 	

	(1)		This caption does not include deferred financing fees related to the Company’s revolving facilities, which are included within “Deferred charges and other assets” on the consolidated balance sheets and are amortized using the straight-line method over the term of the respective facility.	
	(2)		The Company had $360.2 million (net of $14.8 million outstanding letters of credit) of funds available for borrowing under this facility as of December 31, 2017. Additionally, the Company is required to pay a quarterly commitment fee in respect of any unused commitments under this facility equal to 0.375% per annum.	
	(3)		As a result of an amendment to the facility during the fourth quarter of 2017, the Accounts Receivable Securitization Facility has a borrowing capacity of $150.0 million as of December 31, 2017. Additionally, as of December 31, 2017, the Company had approximately $122.1 million of accounts receivable available to support this facility, based on the pool of eligible accounts receivable. In regards to outstanding borrowings, fixed interest charges are 1.95% plus variable commercial paper rates, while for available, but undrawn commitments, fixed interest charges are 1.0%, both of which were reduced as a result of the amendment in December 2017.	

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For the years ended December 31, 2017, 2016, and 2015, interest charges, amortization of deferred financing fees and debt discounts, and cash paid for interest by debt facility are included in the tables below. Interest charges and amortization of deferred financing fees and debt discounts are recorded within “Interest expense, net” in the consolidated statements of operations.

 	 	Year Ended December 31, 2017	
 	 	Interest expense	 	Amortization of deferred financing fees and debt discounts	 	Cash paid for interest	 	
Senior Credit Facility	 	 	 	 	 	 	 	 	 	 	
2022 Revolving Facility	 	$	0.7	 	$	0.3	 	$	
0.6	 	
2024 Term Loan B	 	 	8.8	 	 	0.8	 	 	
8.6	 	
2025 Senior Notes	 	 	9.1	 	 	0.3	 	 	 —	 	
Accounts Receivable Securitization Facility	 	 	2.8	 	 	 —	 	 	2.8	 	
2020 Senior Credit Facility	 	 	 	 	 	 	 	 	 	 	
2020 Revolving Facility	 	 	1.3	 	 	1.0	 	 	1.1	 	
2021 Term Loan B	 	 	14.6	 	 	1.3	 	 	14.7	 	
2022 Senior Notes	 	 	31.9	 	 	1.4	 	 	39.1	 	

 	 	Year Ended December 31, 2016	
 	 	Interest expense	 	Amortization of deferred financing fees and debt discounts	 	Cash paid for interest	 	
2020 Senior Credit Facility	 	 	 	 	 	 	 	 	 	 	
2020 Revolving Facility	 	$	1.8	 	$	1.5	 	$	1.6	 	
2021 Term Loan B	 	 	21.4	 	 	1.9	 	 	21.4	 	
2022 Senior Notes	 	 	46.6	 	 	1.9	 	 	47.2	 	
Accounts Receivable Securitization Facility	 	 	2.8	 	 	0.5	 	 	2.8	 	

 	 	Year Ended December 31, 2015	
 	 	Interest expense	 	Amortization of deferred financing fees and debt discounts	 	Cash paid for interest	 	
2020 Senior Credit Facility	 	 	 	 	 	 	 	 	 	 	
2020 Revolving Facility	 	$	1.3	 	$	1.0	 	$	1.3	 	
2021 Term Loan B	 	 	14.2	 	 	1.2	 	 	14.2	 	
2022 Senior Notes	 	 	30.5	 	 	1.2	 	 	22.8	 	
Accounts Receivable Securitization Facility	 	 	2.8	 	 	1.2	 	 	2.8	 	
2018 Revolving Facility	 	 	0.6	 	 	1.0	 	 	0.6	 	
2019 Senior Notes	 	 	38.3	 	 	2.1	 	 	81.7	 	
 
Total accrued interest on outstanding debt as of December 31, 2017 and 2016 was $9.3 million and $7.6 million, respectively. Accrued interest is recorded in “Accrued expenses and other current liabilities” within the consolidated balance sheets.
 
2020 Senior Credit Facility
On May 5, 2015, Trinseo Materials Operating S.C.A. and Trinseo Materials Finance, Inc. (together, the “Issuers” or the “Borrowers”), both wholly-owned subsidiaries of the Company, entered into a senior secured credit agreement, which provided senior secured financing of up to $825.0 million (the “2020 Senior Credit Facility”). The 2020 Senior Credit Facility provided for senior secured financing consisting of a (i) $325.0 revolving credit facility, with a $25.0 million swingline subfacility and a $35.0 million letter of credit subfacility (the “2020 Revolving Facility”) maturing in May 2020 and (ii) $500.0 million senior secured term loan B facility maturing in November 2021 (the “2021 Term Loan B”). In conjunction with this agreement, the Company terminated its previous credit agreement (the “2018 Senior Secured Credit Facility”) and revolving facility (the “2018 Revolving Facility”).

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In September 2017, upon completion of the refinancing transactions discussed below, the Company terminated the 2020 Senior Credit Facility. Prior to this termination, the Company had no outstanding borrowings under the 2020 Revolving Facility and had $490.0 million outstanding under the 2021 Term Loan B, excluding unamortized original issue discount. As a result of this termination, the Company recognized a $0.8 million loss on extinguishment of long-term debt, comprised entirely of the write-off of a portion of the existing unamortized deferred financing fees and unamortized original issue discount related to the 2021 Term Loan B. The remaining unamortized deferred financing fees and unamortized original issue discount for both the 2020 Revolving Facility and 2021 Term Loan B remain capitalized and will be amortized along with new deferred financing fees over the life of the new facilities, discussed in further detail below.
Senior Credit Facility
On September 6, 2017, the Issuers entered into a new senior secured credit agreement (the “Credit Agreement”), which provides senior secured financing of up to $1,075.0 million (the “Senior Credit Facility”). The Senior Credit Facility provides for senior secured financing consisting of a (i) $375.0 million revolving credit facility, with a $25.0 million swingline subfacility and a $35.0 million letter of credit subfacility maturing in September 2022 (the “2022 Revolving Facility”) and a (ii) $700.0 million senior secured term loan B facility maturing in September 2024 (the “2024 Term Loan B”). Amounts under the 2022 Revolving Facility are available in U.S. dollars and euros.
The 2024 Term Loan B bears an interest rate of LIBOR plus 2.50%, subject to a 0.00% LIBOR floor. Further, the 2024 Term Loan B requires scheduled quarterly payments in amounts equal to 0.25% of the original principal amount of the 2024 Term Loan B, with the balance to be paid at maturity. As of December 31, 2017, $7.0 million of the scheduled future payments related to this facility were classified as current debt on the Company’s consolidated balance sheet.
Loans under the 2022 Revolving Facility, at the Borrowers’ option, may be maintained as (a) LIBO rate loans, which bear interest at a rate per annum equal to the LIBO rate plus the applicable margin (as defined in the Credit Agreement), if applicable, or (b) base rate loans which shall bear interest at a rate per annum equal to the base rate plus the applicable margin (as defined in the Credit Agreement).
The Senior Credit Facility is collateralized by a security interest in substantially all of the assets of the Borrowers, and the guarantors thereunder, including Trinseo Materials S.à r.l., certain Luxembourg subsidiaries and certain foreign subsidiaries organized in the United States, The Netherlands, Hong Kong, Singapore, Ireland, Germany and Switzerland.
The Senior Credit Facility requires the Borrowers and their restricted subsidiaries to comply with customary affirmative, negative and financial covenants, including limitations on their abilities to incur liens; make certain loans and investments; incur additional debt (including guarantees or other contingent obligations); merge, consolidate liquidate or dissolve; transfer or sell assets; pay dividends and other distributions to shareholders or make certain other restricted payments; enter into transactions with affiliates; restrict any restricted subsidiary from paying dividends or making other distributions or agree to certain negative pledge clauses; materially alter the business we conduct; prepay certain other indebtedness; amend certain material documents; and change our fiscal year.
The 2022 Revolving Facility contains a financial covenant that requires compliance with a springing first lien net leverage ratio test. If the outstanding balance under the 2022 Revolving Facility exceeds 30% of the $375.0 million borrowing capacity (excluding undrawn letters of credit up to $10.0 million and cash collateralized letters of credit) at a quarter end, then the Borrowers’ first lien net leverage ratio may not exceed 2.00 to 1.00.
Fees incurred in connection with the issuance of the 2024 Term Loan B were $12.3 million. Due to a portion of the 2024 Term Loan B meeting the criteria for modification accounting, $1.2 million of these fees were expensed and included within “Other expense (income), net” in the consolidated statement of operations for the year ended December 31, 2017. The remaining $11.1 million of fees were capitalized and recorded within “Long-term debt, net of unamortized deferred financing fees” on the consolidated balance sheet, to be amortized along with the remaining $8.1 million of unamortized deferred financing fees from the 2021 Term Loan B. Capitalized fees related to the 2024 Term Loan B are being amortized over the 7.0 year term of the facility using the effective interest method.
Fees incurred in connection with the issuance of the 2022 Revolving Facility were $0.8 million and were capitalized and recorded within “Deferred charges and other assets” in the consolidated balance sheets. The new capitalized fees related to the 2022 Revolving Facility (along with $4.0 million of unamortized deferred financing fees from the 2020 Revolving Facility) are being amortized over the 5.0 year term of the facility using the straight-line

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method. Unamortized deferred financing fees related to the 2022 Revolving Facility were $4.5 million as of December 31, 2017.
2019 Senior Notes
In January 2013, the Company issued $1,325.0 million 8.750% senior notes due to mature on February 1, 2019 (the “2019 Senior Notes”). The proceeds from the issuance of the 2019 Senior Notes were used to repay all of the Company’s then outstanding term loans and related refinancing fees and expenses.
On May 13, 2015, using the net proceeds from the issuance of the 2021 Term Loan B discussed above, together with the net proceeds from the issuance of the 2022 Senior Notes (defined and discussed below) and available cash, the Company redeemed all outstanding borrowings under the 2019 Senior Notes, then totaling $1,192.5 million in principal, together with a call premium of $68.6 million (with a redemption price of 103% on the first $132.5 million and 106.097% on the remaining balance) and accrued and unpaid interest thereon of $29.6 million.
As a result, during the year ended December 31, 2015, the Company recorded a loss on extinguishment of long-term debt of $94.5 million, which includes the above $68.6 million call premium and a $25.9 million write-off of unamortized deferred financing fees related to the 2019 Senior Notes. Prior to the May 2015 redemption, fees and expenses incurred in connection with the issuance of 2019 Senior Notes were being amortized over the term of the 2019 Senior Notes using the effective interest rate method.
2022 Senior Notes
On May 5, 2015, the Issuers executed an indenture pursuant to which they issued $300.0 million aggregate principal amount of 6.750% senior notes due May 1, 2022 (the “USD Notes”) and €375.0 million aggregate principal amount of 6.375% senior notes due May 1, 2022 (the “Euro Notes”, and together with the USD Notes, the “2022 Senior Notes”).
On September 7, 2017, using the net proceeds from the issuance of the 2024 Term Loan B discussed above, together with the net proceeds from the issuance of the 2025 Senior Notes (defined and discussed below), and available cash, the Company redeemed all outstanding borrowings under the 2022 Senior Notes, totaling $746.0 million in USD-equivalent principal, together with a total combined call premium of $53.0 million (with a redemption price of approximately 106.572% on the USD Notes and a redemption price of approximately 107.459% on the Euro Notes), and accrued and unpaid interest thereon of $17.0 million, using applicable foreign exchange rates.
As a result of this redemption, during the year ended December 31, 2017, the Company recorded a loss on extinguishment of long-term debt of $64.5 million, which includes the above $53.0 million call premium and an $11.5 million write-off of unamortized deferred financing fees related to the 2022 Senior Notes. Prior to the September 2017 redemption, fees and expenses incurred in connection with the issuance of 2022 Senior Notes were being amortized over the term of the 2022 Senior Notes using the effective interest rate method.
2025 Senior Notes
On August 29, 2017, the Issuers executed an indenture (the “Indenture”) pursuant to which they issued $500.0 million aggregate principal amount of 5.375% senior notes due 2025 (the “2025 Senior Notes”) in a 144A private transaction exempt from the registration requirements of the Securities Act of 1933, as amended. Interest on the 2025 Senior Notes is payable semi-annually on May 3 and November 3 of each year, commencing on May 3, 2018. The 2025 Senior Notes mature on September 1, 2025.
At any time prior to September 1, 2020, the Issuers may redeem the 2025 Senior Notes in whole or in part, at their option, at a redemption price equal to 100% of the principal amount of such notes plus the relevant applicable premium as of, and accrued and unpaid interest to, but not including, the redemption date. At any time and from time to time after September 1, 2020, the Issuers may redeem the 2025 Senior Notes, in whole or in part, at a redemption price equal to the

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percentage of principal amount set forth below plus accrued and unpaid interest, if any, on the notes redeemed to, but not including, the redemption date:

12-month period commencing September 1 in Year  	 	Percentage	 	
2020	 	102.688	%  	
2021	 	101.792	%  	
2022	 	100.896	%  	
2023 and thereafter	 	100.000	%  	
At any time prior to September 1, 2020, the Issuers may redeem up to 40% of the aggregate principal amount of the 2025 Senior Notes at a redemption price equal to 105.375%, plus accrued and unpaid interest to, but not including, the redemption date, with the aggregate gross proceeds from certain equity offerings.
The 2025 Senior Notes are the Issuers’ senior unsecured obligations and rank equally in right of payment with all of the Issuers’ existing and future indebtedness that is not expressly subordinated in right of payment thereto. The 2025 Senior Notes will be senior in right of payment to any future indebtedness that is expressly subordinated in right of payment thereto and effectively junior to (a) the Issuers’ existing and future secured indebtedness, including the Company’s accounts receivable facility and the Issuers’ Senior Credit Facility (discussed above), to the extent of the value of the collateral securing such indebtedness and (b) all existing and future liabilities of the Issuers’ non-guarantor subsidiaries.
The Indenture contains customary covenants that, among other things, limit the Issuers’ and certain of their subsidiaries’ ability to incur additional indebtedness and guarantee indebtedness; pay dividends on, redeem or repurchase capital stock; make investments; prepay certain indebtedness; create liens; enter into transactions with the Issuers’ affiliates; designate the Issuers’ subsidiaries as Unrestricted Subsidiaries (as defined in the Indenture); and consolidate, merge, or transfer all or substantially all of the Issuers’ assets. The covenants are subject to a number of exceptions and qualifications. Certain of these covenants will be suspended during any period of time that (1) the 2025 Senior Notes have investment grade ratings (as defined in the Indenture) and (2) no default has occurred and is continuing under the Indenture. In the event that the 2025 Senior Notes are downgraded to below an investment grade rating, the Issuers and certain subsidiaries will again be subject to the suspended covenants with respect to future events.
Fees and expenses incurred in connection with the issuance of the 2025 Senior Notes were $9.7 million, which were capitalized and recorded within “Long-term debt, net of unamortized deferred financing fees” on the consolidated balance sheet, and are being amortized into “Interest expense, net” in the consolidated statements of operations over their 8.0 year term using the effective interest method.
Accounts Receivable Securitization Facility
In 2010, Styron Receivable Funding Ltd. (“SRF”), a VIE in which the Company is the primary beneficiary, executed an agreement for an accounts receivable securitization facility (“Accounts Receivable Securitization Facility”). As of December 31, 2017, the facility, as amended in December 2017, permitted borrowings by two of the Company’s subsidiaries, Trinseo Europe GmbH (“TE”) and Trinseo Export GmbH (“Trinseo Export”), up to a total of $150.0 million and has a maturity date of May 2019.
Under the facility, TE and Trinseo Export sell their accounts receivable to SRF. In turn, SRF may utilize these receivables as collateral to borrow from commercial paper conduits in exchange for cash. The Company has agreed to continue servicing the receivables for SRF. If utilized as collateral by SRF, the conduits have a first priority perfected security interest in such receivables and, as a result, the receivables will not be available to the creditors of the Company or its other subsidiaries.
NOTE 11—DERIVATIVE INSTRUMENTS
The Company’s ongoing business operations expose it to various risks, including fluctuating foreign exchange rates and interest rate risk. To manage these risks, the Company periodically enters into derivative financial instruments, such as foreign exchange forward contracts and interest rate swap agreements. The Company does not hold or enter into financial instruments for trading or speculative purposes. All derivatives are recorded in the consolidated balance sheets at fair value. Refer to Note 12 for fair value disclosures related to these instruments.

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Foreign Exchange Forward Contracts
Certain subsidiaries have assets and liabilities denominated in currencies other than their respective functional currencies, which creates foreign exchange risk. The Company’s principal strategy in managing its exposure to changes in foreign currency exchange rates is to naturally hedge the foreign currency-denominated liabilities on our consolidated balance sheets against corresponding assets of the same currency such that any changes in liabilities due to fluctuations in exchange rates are offset by changes in their corresponding foreign currency assets. In order to further reduce its exposure, the Company also uses foreign exchange forward contracts to economically hedge the impact of the variability in exchange rates on our assets and liabilities denominated in certain foreign currencies. These derivative contracts are not designated for hedge accounting treatment.
As of December 31, 2017, the Company had open foreign exchange forward contracts with a notional U.S. dollar equivalent absolute value of $225.8 million. The following table displays the notional amounts of the most significant net foreign exchange hedge positions outstanding as of December 31, 2017:

 	 	December 31, 	 	
Buy / (Sell) 	    	2017	 	
Chinese Yuan	 	$	(75.4)	 	
Euro	 	$	(62.1)	 	
Indonesian Rupiah	 	$	(23.0)	 	
Swiss Franc	 	$	14.8	 	
Japanese Yen	 	$	(11.1)	 	

Open foreign exchange forward contracts as of December 31, 2017 have maturities of less than three months.
Foreign Exchange Cash Flow Hedges
The Company also enters into forward contracts with the objective of managing the currency risk associated with forecasted U.S. dollar-denominated raw materials purchases by one of its subsidiaries whose functional currency is the euro. By entering into these forward contracts, which are designated as cash flow hedges, the Company buys a designated amount of U.S. dollars and sells euros at the prevailing market rate to mitigate the risk associated with the fluctuations in the euro-to-U.S. dollar foreign currency exchange rates. The qualifying hedge contracts are marked-to-market at each reporting date and any unrealized gains or losses are included in AOCI to the extent effective, and reclassified to cost of sales in the period during which the transaction affects earnings or it becomes probable that the forecasted transaction will not occur.
Open foreign exchange cash flow hedges as of December 31, 2017 have maturities occurring over a period of 12 months, and have a net notional U.S. dollar equivalent of $216.0 million.
Interest Rate Swaps
As discussed in Note 10, on September 6, 2017, the Company issued the 2024 Term Loan B, which bears an interest rate of LIBOR plus 2.50%, subject to a 0.00% LIBOR floor. In order to reduce the variability in interest payments associated with the Company’s variable rate debt, during the third quarter of 2017, the Company entered into certain interest rate swap agreements to convert a portion of these variable rate borrowings into a fixed rate obligation. These interest rate swap agreements are designated as cash flow hedges, and as such, the contracts are marked-to-market at each reporting date and any unrealized gains or losses are included in AOCI to the extent effective, and reclassified to interest expense in the period during which the transaction affects earnings or it becomes probable that the forecasted transaction will not occur.
As of December 31, 2017, the Company had open interest rate swap agreements with a net notional U.S. dollar equivalent of $200.0 million which had an effective date of September 29, 2017 and mature over a period of five years. Under the terms of the swap agreements, we are required to pay the counterparties a stream of fixed interest payments at a rate of 1.81%, and in turn, receive variable interest payments based on 1-month LIBOR (1.57% as of December 31, 2017) from the counterparties.

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Net Investment Hedge
Through August 31, 2017, the Company had designated a portion ( €280.0 million) of the original principal amount of the Company’s previous €375.0 million Euro Notes as a hedge of the foreign currency exposure of the Issuers’ net investment in certain European subsidiaries. Effective September 1, 2017, the Company de-designated the Euro Notes as a net investment hedge of the Issuers’ net investment in certain European subsidiaries, as the Euro Notes were redeemed on September 7, 2017 (refer to Note 10 for further information). Through the date of de-designation, this hedge was deemed to be highly effective, and changes in the Euro Notes’ carrying value resulting from fluctuations in the euro exchange rate were recorded as cumulative foreign currency translation loss of $24.1 million within AOCI.
On August 29, 2017, the Issuers executed an indenture pursuant to which they issued the $500.0 million 5.375% 2025 Senior Notes (refer to Note 10 for further information). Subsequently, on September 1, 2017, the Company entered into certain fixed-for-fixed cross currency swaps (“CCS”), swapping U.S. dollar principal and interest payments on the newly issued 2025 Senior Notes for euro-denominated payments. Under the terms of the CCS, the Company has notionally exchanged $500.0 million at an interest rate of 5.375% for €420 million at a weighted-average interest rate of 3.45% for approximately five years.
Effective September 1, 2017, the Company designated the full notional amount of the CCS (€420 million) as a hedge of the Issuers’ net investment in certain European subsidiaries. As the CCS were deemed to be highly effective hedges, changes in the fair value of the CCS were recorded as cumulative foreign currency translation loss of $17.5 million within AOCI as of December 31, 2017.
Summary of Derivative Instruments
Information regarding changes in the fair value of the Company’s derivative instruments, net of tax, including those not designated for hedge accounting treatment, is as follows:

 	 	Gain (Loss) Recognized in	 	Gain (Loss) Recognized in	 	 	
 	 	AOCI on Balance Sheet	 	Statement of Operations	 	 	
 	 	Year Ended December 31, 	 	Statement of Operations	
 	 	2017	 	2016	 	2015	 	2017	 	2016	 	2015	 	Classification	
Designated as Cash Flow Hedges	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Foreign exchange cash flow hedges	  	$	(21.3)	  	$	6.7	  	$	5.6	  	$	(2.0)	  	$	2.8	  	$	0.5	  	Cost of sales	
Interest rate swaps	 	 	2.9	 	 	 —	 	 	 —	 	 	(0.3)	 	 	 —	 	 	 —	 	Interest expense, net	
Total	 	$	(18.4)	 	$	6.7	 	$	5.6	 	$	(2.3)	 	$	2.8	 	$	0.5	 	 	
Net Investment Hedges	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Euro Notes	 	$	38.6	 	$	14.1	 	$	0.4	 	$	 —	 	$	 —	 	$	 —	 	 	
Cross-currency swaps	 	 	(17.5)	 	 	 —	 	 	 —	 	 	 —	 	 	 —	 	 	 —	 	 	
Total	 	$	21.1	 	$	14.1	 	$	0.4	 	$	 —	 	$	 —	 	$	 —	 	 	
Not Designated as Cash Flow Hedges	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Foreign exchange forward contracts	 	$	 —	 	$	 —	 	$	 —	 	$	(19.2)	 	$	3.7	 	$	(16.5)	 	Other expense (income), net	
Total	 	$	 —	 	$	 —	 	$	 —	 	$	(19.2)	 	$	3.7	 	$	(16.5)	 	 	
 
The Company recorded losses of $19.2 million and $16.5 million during the years ended December 31, 2017 and 2015, respectively, and gains of $3.7 million during the year ended December 31, 2016 from settlements and changes in the fair value of outstanding forward contracts (not designated as hedges) .   The activity from these forward contracts offset net foreign exchange transaction gains of $20.6 million and $6.1 million during the years ended December 31, 2017 and 2015, respectively, and losses of $5.5 million during the year ended December 31, 2016 which resulted from the remeasurement of the Company’s foreign currency denominated assets and liabilities. The cash settlements of these foreign exchange forward contracts are included within operating activities in the consolidated statements of cash flows.
As of December 31, 2017, the Company had no ineffectiveness related to its derivatives designated as hedging instruments. Further, the Company expects to reclassify in the next twelve months an approximate $11.2 million net loss from AOCI into earnings related to the Company’s outstanding foreign exchange cash flow hedges and interest rate swaps as of December 31, 2017 based on current foreign exchange rates.

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The following table summarizes the net unrealized gains and losses and balance sheet classification of outstanding derivatives recorded in the consolidated balance sheets:

 	 	December 31, 2017	   	December 31, 2016	 	
 	 	Foreign
Exchange	 	Foreign
Exchange	 	Interest	 	Cross-	 	 	 	Foreign
Exchange	 	Foreign
Exchange	 	 	 	
 	 	Forward	 	Cash Flow	 	Rate	 	Currency	 	 	 	Forward	 	Cash Flow	 	 	 	
Balance Sheet Classification	    	Contracts	       	Hedges	        	Swaps	    	Swaps	        	Total	     	Contracts	       	Hedges	        	Total	 	
Asset Derivatives:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Accounts receivable, net of allowance	 	$	0.1	 	$	 —	 	$	 —	 	$	10.8	 	$	10.9	 	$	1.7	 	$	11.0	 	$	12.7	 	
Deferred charges and other assets	 	 	 —	 	 	 —	 	 	3.0	 	 	 —	 	 	3.0	 	 	 —	 	 	 —	 	 	 —	 	
Total asset derivatives	 	$	0.1	 	$	 —	 	$	3.0	 	$	10.8	 	$	13.9	 	$	1.7	 	$	11.0	 	$	12.7	 	
Liability Derivatives:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Accounts payable	 	$	2.5	 	$	11.1	 	$	0.1	 	$	 —	 	$	13.7	 	$	0.5	 	$	 —	 	$	0.5	 	
Other noncurrent obligations	 	 	 —	 	 	 —	 	 	 —	 	 	28.3	 	 	28.3	 	 	 —	 	 	 —	 	 	 —	 	
Total liability derivatives	 	$	2.5	 	$	11.1	 	$	0.1	 	$	28.3	 	$	42.0	 	$	0.5	 	$	 —	 	$	0.5	 	
 
Forward contracts, interest rate swaps, and cross currency swaps are entered into with a limited number of counterparties, each of which allows for net settlement of all contracts through a single payment in a single currency in the event of a default on or termination of any one contract. As such, in accordance with the Company’s accounting policy, we record these derivative instruments on a net basis by counterparty within the consolidated balance sheets. Information regarding the gross amounts of the Company’s derivative instruments and the amounts offset in the consolidated balance sheets is as follows:

 	 	Gross Amounts	 	Gross Amounts	 	Net Amounts	 	
 	 	Recognized in the	 	Offset in the	 	Presented in the	 	
 	    	Balance Sheet	    	Balance Sheet	    	Balance Sheet	 	
Balance at December 31, 2017	 	 	 	 	 	 	 	 	 	 	
Derivative assets	 	$	14.5	 	$	(0.6)	 	$	13.9	 	
Derivative liabilities	 	 	42.6	 	 	(0.6)	 	 	42.0	 	
 	 	 	 	 	 	 	 	 	 	 	
Balance at December 31, 2016	 	 	 	 	 	 	 	 	 	 	
Derivative assets	 	$	23.4	 	$	(10.7)	 	$	12.7	 	
Derivative liabilities	 	 	11.2	 	 	(10.7)	 	 	0.5	 	
Refer to Notes 12 and 20 for further information regarding the fair value of the Company’s derivative instruments and the related changes in AOCI.
 
NOTE 12—FAIR VALUE MEASUREMENTS
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Assets and liabilities measured at fair value are classified using the following hierarchy, which is based upon the transparency of inputs to the valuation as of the measurement date.
Level 1—Valuation is based upon quoted prices (unadjusted) for identical assets or liabilities in active markets.
Level 2—Valuation is based upon quoted prices for similar assets and liabilities in active markets, or other inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.
Level 3—Valuation is based upon other unobservable inputs that are significant to the fair value measurement.

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The following table summarizes the basis used to measure certain assets and liabilities at fair value on a recurring basis in the consolidated balance sheets at December 31, 2017 and 2016:

 	 	December 31, 2017	 	
 	 	Quoted Prices in Active Markets for Identical Items	 	Significant Other Observable Inputs	 	Significant Unobservable Inputs	 	 	 	 	
Assets (Liabilities) at Fair Value	    	(Level 1)	    	(Level 2)	    	(Level 3)	    	Total	 	
Foreign exchange forward contracts—Assets	    	$	 —	    	$	0.1	    	$	 —	    	$	0.1	 	
Foreign exchange forward contracts—(Liabilities)	 	 	 —	 	 	(2.5)	 	 	 —	 	 	(2.5)	 	
Foreign exchange cash flow hedges—(Liabilities)	 	 	 —	 	 	(11.1)	 	 	 —	 	 	(11.1)	 	
Interest rate swaps—Assets	 	 	 —	 	 	3.0	 	 	 —	 	 	3.0	 	
Interest rate swaps—(Liabilities)	 	 	 —	 	 	(0.1)	 	 	 —	 	 	(0.1)	 	
Cross-currency swaps—Assets	 	 	 —	 	 	10.8	 	 	 —	 	 	10.8	 	
Cross-currency swaps—(Liabilities)	 	 	 —	 	 	(28.3)	 	 	 —	 	 	(28.3)	 	
Total fair value	 	$	 —	 	$	(28.1)	 	$	 —	 	$	(28.1)	 	

 	 	December 31, 2016	 	
 	 	Quoted Prices in Active Markets for Identical Items	 	Significant Other Observable Inputs	 	Significant Unobservable Inputs	 	 	 	 	
Assets (Liabilities) at Fair Value	    	(Level 1)	    	(Level 2)	    	(Level 3)	    	Total	 	
Foreign exchange forward contracts—Assets	 	$	 —	    	$	1.7	    	$	 —	    	$	1.7	 	
Foreign exchange forward contracts—(Liabilities)	 	 	 —	 	 	(0.5)	 	 	 —	 	 	(0.5)	 	
Foreign exchange cash flow hedges—Assets	    	 	 —	    	 	11.0	 	 	 —	 	 	11.0	 	
Total fair value	 	$	 —	 	$	12.2	 	$	 —	 	$	12.2	 	
 
The Company uses an income approach to value its derivative instruments, utilizing discounted cash flow techniques, considering the terms of the contract and observable market information available as of the reporting date, such as interest rate yield curves and currency spot and forward rates. Significant inputs to the valuation for these derivative instruments are obtained from broker quotations or from listed or over-the-counter market data, and are classified as Level 2 in the fair value hierarchy.
Nonrecurring Fair Value Measurements
The Company’s financial assets and liabilities measured at fair value on a nonrecurring basis as of December 31, 2016 were as follows:

 	 	December 31, 2016	 	 	 	 	
 	 	Quoted Prices in Active Markets for Identical Items
(Level 1)	 	Significant Other Observable Inputs
(Level 2)	 	Significant Unobservable Inputs
(Level 3)	 	Total Expense for the Year Ended December 31, 2016	 	
Assets:	 	 	 	 	 	 	 	 	 	 	 	 	 	
Livorno property, plant and equipment (Note 19)	 	$	 —	 	$	 —	 	$	11.0	 	$	13.7	 	
Total	 	$	 —	 	$	 —	 	$	11.0	 	$	13.7	 	
 
Refer to Note 19 for information regarding the Livorno plant restructuring announced during the third quarter of 2016. As a result, the Company determined that the long-lived assets at the Livorno latex binders facility, which included land and depreciable long-lived assets, should be assessed for impairment. This assessment indicated that the carrying

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value of the asset group was not recoverable when compared to the expected undiscounted cash flows from the operation and eventual disposition of these assets. Based upon our assessment, the Company concluded that the fair value of this asset group totaled $11.0 million as of December 31, 2016. As a result, the Company recorded an impairment loss on these assets of approximately $13.7 million for the year ended December 31, 2016. The amount was recorded within “Selling, general and administrative expenses” in the consolidated statement of operations and allocated entirely to the Latex Binders segment.
The fair value of the depreciable assets was determined under the income approach, utilizing a discounted cash flow model. The key assumption in this model was cash flow projections, which were determined to be nil, as the plant ceased manufacturing operations in October 2016. The fair value of the land was determined utilizing a combination of the market and income approaches, utilizing key inputs such as recent comparable market transactions, expected date of sale, and discount rate.
Fair Value of Debt Instruments
The following table presents the estimated fair value of the Company’s outstanding debt not carried at fair value as of December 31, 2017 and 2016, respectively:

 	    	As of	    	As of	 	
 	    	December 31, 2017	    	December 31, 2016	 	
2025 Senior Notes	 	$	518.8	 	$	 —	 	
2022 Senior Notes	 	 	 	 	 	 	 	
USD Notes	 	 	 —	 	 	315.0	 	
Euro Notes	 	 	 —	 	 	424.4	 	
2024 Term Loan B	 	 	705.7	 	 	 —	 	
2021 Term Loan B	 	 	 —	 	 	498.0	 	
Total fair value	 	$	1,224.5	 	$	1,237.4	 	
 
The fair value of the Company’s debt facilities above (each Level 2 securities) is determined using over-the-counter market quotes and benchmark yields received from independent vendors.
There were no other significant financial instruments outstanding as of December 31, 2017 and 2016.
NOTE 13—INCOME TAXES
Income before income taxes earned within and outside the United States is shown below:

 	 	Year Ended	 	
 	 	December 31,	 	
 	 	2017	 	2016	 	2015	 	
United States	    	$	138.0	    	$	137.2	    	$	105.2	 	
Outside of the United States	 	 	273.1	 	 	268.1	 	 	98.6	 	
Income before income taxes	 	$	411.1	 	$	405.3	 	$	203.8	 	

The provision for income taxes is composed of:

 	 	Year Ended	 	Year Ended	 	Year Ended	 	
 	 	December 31, 2017	 	December 31, 2016	 	December 31, 2015	 	
 	 	Current	 	Deferred	 	Total	 	Current	 	Deferred	 	Total	 	Current	 	Deferred	 	Total	 	
U.S. federal	  	$	33.5	  	$	6.9	  	$	40.4	  	$	24.8	  	$	15.6	  	$	40.4	  	$	28.3	  	$	0.2	  	$	28.5	 	
U.S. state and other	  	 	4.8	  	 	 —	  	 	4.8	  	 	4.0	  	 	1.4	  	 	5.4	  	 	4.5	  	 	 —	  	 	4.5	 	
Non-U.S.	  	 	29.7	  	 	7.9	  	 	37.6	  	 	42.1	  	 	(0.9)	  	 	41.2	  	 	37.5	  	 	(0.3)	  	 	37.2	 	
Total	  	$	68.0	  	$	14.8	  	$	82.8	  	$	70.9	  	$	16.1	  	$	87.0	  	$	70.3	  	$	(0.1)	  	$	70.2	 	

 

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The effective tax rate on pre-tax income differs from the U.S. statutory rate due to the following:

 	 	Year Ended December 31,	 	
 	 	2017	 	2016	 	2015	 	
Taxes at U.S. statutory rate (1)	  	$	143.9	  	$	141.9	  	$	71.4	 	
State and local income taxes	  	 	3.4	  	 	3.9	  	 	3.0	 	
Non U.S. statutory rates, including credits	  	 	(98.6)	  	 	(77.8)	  	 	(29.9)	 	
U.S. tax effect of foreign earnings and dividends	  	 	(1.6)	  	 	(1.7)	  	 	(1.9)	 	
Unremitted earnings	  	 	6.6	  	 	3.8	  	 	4.0	 	
Change in valuation allowances	  	 	34.0	  	 	6.2	  	 	24.3	 	
Uncertain tax positions	  	 	(10.7)	  	 	(1.8)	  	 	1.2	 	
Withholding taxes on interest and royalties	  	 	2.9	  	 	2.4	  	 	2.6	 	
U.S. manufacturing deduction	  	 	(3.6)	  	 	(2.9)	  	 	(3.0)	 	
Stock-based compensation	  	 	(1.1)	  	 	2.1	  	 	1.2	 	
Non-deductible interest	  	 	2.9	  	 	2.5	  	 	3.1	 	
Non-deductible other expenses	  	 	1.2	  	 	6.0	  	 	0.9	 	
Impact on foreign currency exchange	  	 	0.4	  	 	2.1	  	 	(3.5)	 	
Other—net (2)	  	 	3.1	  	 	0.3	  	 	(3.2)	 	
Total provision for income taxes	  	$	82.8	  	$	87.0	  	$	70.2	 	
Effective tax rate	  	 	20	%	 	21	%	 	34	%	

	(1)		The U.S. statutory rate has been used as management believes it is more meaningful to the Company.	
	(2)		Included in “Other-net” is $3.1 million of one-time income tax expense related to the revaluation of our U.S. federal deferred tax assets and liabilities at the new U.S. federal corporate income tax rate of 21% in accordance with the enactment of the “Tax Cuts and Jobs Act” signed into law on December 22, 2017. There were no other applicable provisions of this newly enacted tax law that have a significant impact to the Company’s financial statements.	
 
Deferred income taxes reflect temporary differences between the valuation of assets and liabilities for financial and tax reporting:

 	 	December 31,	 	
 	 	2017	 	2016	 	
 	 	Deferred	 	Deferred	 	Deferred	 	Deferred	 	
 	 	Tax	 	Tax	 	Tax	 	Tax	 	
 	 	Assets	 	Liabilities	 	Assets	 	Liabilities	 	
Tax loss and credit carry forwards	    	$	137.3	    	$	 —	    	$	104.4	    	$	 —	 	
Unremitted earnings	 	 	 —	 	 	17.2	 	 	 —	 	 	10.6	 	
Unconsolidated affiliates	 	 	 —	 	 	0.1	 	 	4.4	 	 	 —	 	
Other accruals and reserves	 	 	2.2	 	 	 —	 	 	5.2	 	 	 —	 	
Property, plant and equipment	 	 	 —	 	 	34.4	 	 	 —	 	 	44.3	 	
Goodwill and other intangible assets	 	 	 —	 	 	1.2	 	 	13.8	 	 	 —	 	
Deferred financing fees	 	 	12.9	 	 	 —	 	 	13.2	 	 	 —	 	
Employee benefits	 	 	36.4	 	 	 —	 	 	45.4	 	 	 —	 	
 	 	 	188.8	 	 	52.9	 	 	186.4	 	 	54.9	 	
Valuation allowance	 	 	(149.6)	 	 	 —	 	 	(112.6)	 	 	 —	 	
Total	 	$	39.2	 	$	52.9	 	$	73.8	 	$	54.9	 	

As of December 31, 2017 and 2016, all undistributed earnings of foreign subsidiaries and affiliates are expected to be repatriated.
Operating loss carryforwards amounted to $535.6 million in 2017 and $404.6 million in 2016. As of December 31, 2017, $42.1 million of the operating loss carryforwards were subject to expiration in 2018 through 2022, and $493.5 million of the operating loss carryforwards expire in years beyond 2022 or have an indefinite carryforward period. The Company had valuation allowances which were related to the realization of recorded tax benefits on tax loss

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carryforwards, as well as other net deferred tax assets, primarily from subsidiaries in Luxembourg and China, of $149.6 million as of December 31, 2017 and $112.6 million as of December 31, 2016.
For the years presented, a reconciliation of the beginning and ending amount of the unrecognized tax benefits is as follows:

Balance as of December 31, 2014	    	$	20.4	
Increases related to current year tax positions	 	 	1.3	
Decreases related to prior year tax positions	 	 	(1.6)	
Balance as of December 31, 2015	 	$	20.1	
Increases related to current year tax positions	 	 	0.1	
Increases related to prior year tax positions	 	 	4.0	
Decreases related to prior year tax positions	 	 	(6.0)	
Settlement of uncertain tax positions	 	 	(1.1)	
Decreases due to expiration of statues of limitations	 	 	(1.0)	
Balance as of December 31, 2016	 	$	16.1	
Increases related to current year tax positions	 	 	 —	
Increases related to prior year tax positions	 	 	0.9	
Decreases related to prior year tax positions	 	 	(8.0)	
Settlement of uncertain tax positions	 	 	(0.7)	
Decrease due to expiration of statutes of limitations	 	 	(1.3)	
Balance as of December 31, 2017	 	$	7.0	

In regard to unrecognized tax benefits, the Company recognized a benefit related to interest and penalties of $2.4 million during the year ended December 31, 2017, whereas the Company recognized expense related to interest and penalties of $0.9 million and $0.7 million during the years ended December 31, 2016 and 2015, respectively. Interest and penalties related to unrecognized tax benefits was included as a component of income tax expense in the consolidated statements of operations. As of December 31, 2017 and 2016, the Company had $0.9 million and $3.1 million, respectively, accrued for interest and penalties. To the extent that the unrecognized tax benefits are recognized in the future, $3.3 million will impact the Company’s effective tax rate.
As of December 31, 2017, the Company anticipates that it is reasonably possible that approximately $1.0 million to $2.0 million of unrecognized tax benefits, including the impact relating to accrued interest and penalties, could be realized within the next twelve months due to the expiration of the statute of limitations in certain jurisdictions.
During the year ended December 31, 2017, the Company recorded a previously unrecognized tax benefit in the amount of $8.5 million, including interest and penalties, upon completion of the 2010 through 2013 audit with the German taxing authority.
Tax years that remain subject to examination for the Company’s major tax jurisdictions are shown below.

Major Tax Jurisdictions	 	 	Earliest Open Year	
United States: Federal income tax	 	 	
2012	
Germany	 	 	
2014	
Switzerland	 	 	
2014	
Netherlands	 	 	
2017	
Luxembourg	 	 	
2011	
China	 	 	
2007	
Hong Kong	 	 	
2006	
Indonesia	 	 	
2011	
Italy	 	 	
2010	

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NOTE 14—COMMITMENTS AND CONTINGENCIES
Leased Property
The Company routinely leases premises for use as sales and administrative offices, warehouses and tanks for product storage, railcars, motor vehicles, and other equipment under operating leases. Rental expense for these leases was $16.2 million, $16.0 million and $18.4 million during the years ended December 31, 2017, 2016, and 2015, respectively.
Future minimum rental payments under operating leases with remaining non-cancelable terms in excess of one year are as follows:

 	    	Annual	 	
Year	 	Commitment	 	
2018	 	$	13.5	 	
2019	 	 	12.6	 	
2020	 	 	9.4	 	
2021	 	 	10.3	 	
2022	 	 	3.6	 	
Thereafter	 	 	16.2	 	
Total	 	$	65.6	 	

Environmental Matters
Accruals for environmental matters are recorded when it is probable that a liability has been incurred and the amount of the liability can be reasonably estimated, based on current law, existing technologies and other information. As of December 31, 2017 and 2016, the Company had no accrued obligations for environmental remediation and restoration costs. Pursuant to the terms of the Acquisition, the pre-closing environmental conditions were retained by Dow and the Company has been indemnified by Dow from and against all environmental liabilities incurred or relating to the predecessor periods. There are several properties which the Company now owns on which Dow has been conducting investigation, monitoring, or remediation to address historical contamination. Those properties include Allyn’s Point, Connecticut, Dalton, Georgia, and Livorno, Italy. There are other properties with historical contamination that are owned by Dow that the Company leases for its operations, including its facilities in Midland, Michigan, Schkopau, Germany, and Terneuzen, The Netherlands. No environmental claims have been asserted or threatened against the Company, and the Company is not a potentially responsible party at any Superfund Sites.
Inherent uncertainties exist in the Company’s potential environmental liabilities primarily due to unknown conditions, whether future claims may fall outside the scope of the indemnity, changing governmental regulations and legal standards regarding liability, and evolving technologies for handling site remediation and restoration. In connection with the Company’s existing indemnification, the possibility is considered remote that environmental remediation costs will have a material adverse impact on the consolidated financial statements.
There were no amounts recorded in the consolidated statements of operations relating to environmental remediation for the years ended December 31, 2017, 2016, and 2015.

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Purchase Commitments
In the normal course of business, the Company has certain raw material purchase contracts where it is required to purchase certain minimum volumes at current market prices. These commitments range from 1 to 4 years. The following table presents the fixed and determinable portion (based on current pricing) of the obligation under the Company’s purchase commitments as of December 31, 2017:

 	    	Annual	 	
Year	 	Commitment	 	
2018	 	$	1,480.1	 	
2019	 	 	1,007.5	 	
2020	 	 	866.6	 	
2021	 	 	4.8	 	
2022	 	 	 —	 	
Thereafter	 	 	 —	 	
Total	 	$	3,359.0	 	
 
In certain raw material purchase contracts, the Company has the right to purchase less than the required minimums and pay a liquidated damages fee, or, in case of a permanent plant shutdown, to terminate the contracts. In such cases, these obligations would be less than the obligations shown in the table above.
The Company has service agreements with Dow, some of which contain fixed annual fees. Refer to Note 17 for further information.
Litigation Matters
From time to time, the Company may be subject to various legal claims and proceedings incidental to the normal conduct of business, relating to such matters as product liability, antitrust/competition, past waste disposal practices and release of chemicals into the environment. While it is impossible at this time to determine with certainty the ultimate outcome of these routine claims, the Company does not believe that the ultimate resolution of these claims will have a material adverse effect on the Company’s results of operations, financial condition or cash flow.
Legal costs, including those legal costs expected to be incurred in connection with a loss contingency, are expensed as incurred.
NOTE 15—PENSION PLANS AND OTHER POSTRETIREMENT BENEFITS
Defined Benefit Pension Plans
Many of the Company’s employees are participants in various defined benefit pension plans which are administered and sponsored by the Company and are primarily in Germany, Switzerland, The Netherlands, Belgium, China and Japan.
Company employees who were not previously associated with the acquired pension and postretirement plans are generally not eligible for enrollment in these plans. Pension benefits are typically based on length of service and the employee’s final average compensation.
Other Postretirement Benefits
The Company provides certain health care and life insurance benefits to Dow-heritage employees in the United States when they retire. Prior to the 2016 divestiture of the Company’s latex binders and automotive businesses in Brazil (refer to Note 3 in the consolidated financial statements), the Company also provided health care and life insurance benefits to retired employees in Brazil.
In the U.S., the plan provides for health care benefits, including hospital, physicians’ services, drug and major medical expense coverage. In general, the plan applies to employees hired by Dow before January 1, 2008 and transferred to the Company in connection with the Acquisition, and who are at least 50 years old with 10 years of service. The plan allows for spouse coverage as well. If an employee was hired on or before January 1, 1993, the

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coverage extends past age 65. For employees hired after January 1, 1993 but before January 1, 2008, coverage ends at age 65. The Company reserves the right to modify the provisions of the plan at any time, including the right to terminate, and does not guarantee the continuation of the plan or its provisions.
Prior to the divestiture of operations in Brazil in 2016, the Company provided an insured medical benefit to all employees and eligible dependents under Brazil’s healthcare legislation, which grants the right to employees (and their beneficiaries) who have contributed towards the medical plan to extend medical coverage upon retirement or in case of involuntary dismissal. The extended medical plan must include the same level of coverage and other conditions offered to active employees, whereas former employees must assume 100% of the premium cost.
Assumptions
The weighted-average assumptions used to determine pension plan obligations and net periodic benefit costs are provided below:

 	 	Pension Plan Obligations	 	Net Periodic Benefit Costs	 	
 	 	December 31,	 	December 31,	 	
 	    	2017	    	2016	    	2015	    	2017	    	2016	    	2015	 	
Discount rate for PBO	 	1.79	%  	1.65	%  	2.06	%  	1.65	%  	2.06	%  	2.01	%	
Discount rate for service cost	 	N/A	 	N/A	 	N/A	 	1.64	%  	2.06	%  	2.01	%  	
Discount rate for interest cost	 	N/A	 	N/A	 	N/A	 	1.42	%  	2.06	%  	2.01	%  	
Rate of increase in future compensation levels	 	2.81	%  	2.61	%  	2.68	%  	2.61	%  	2.68	%  	2.71	%	
Expected long-term rate of return on plan assets	 	N/A	 	N/A	 	N/A	 	1.44	%  	1.79	%  	1.73	%	
 
The weighted-average assumptions used to determine other postretirement benefit (“OPEB”) obligations and net periodic benefit costs are provided below:

 	 	OPEB Obligations	 	Net Periodic Benefit Costs	 	
 	 	December 31,	 	December 31,	 	
 	    	2017	    	2016	    	2015	    	2017	    	2016	    	2015	 	
Discount rate for APBO	 	3.68	%  	4.16	%  	6.51	%  	4.16	%  	6.51	%  	6.40	%	
Discount rate for service cost	 	N/A	 	N/A	 	N/A	 	4.18	%  	6.51	%  	6.40	%  	
Discount rate for interest cost	 	N/A	 	N/A	 	N/A	 	3.81	%  	6.51	%  	6.40	%  	
Initial health care cost trend rate	 	6.70	%  	6.70	%  	8.19	%  	6.70	%  	8.19	%  	8.05	%	
Ultimate health care cost trend rate	 	5.00	%  	5.00	%  	5.26	%  	5.00	%  	5.26	%  	5.43	%	
Year ultimate trend rate to be reached	 	2023	 	2022	 	2023	 	2022	 	2023	 	2021	 	

We determine the discount rate used to measure plan liabilities as of the December 31 measurement date for the pension and postretirement benefit plans. The discount rate reflects the current rate at which the associated liabilities could be effectively settled at the end of the year. We set our rate to reflect the yield of a portfolio of high quality, fixed-income debt instruments that would produce cash flows sufficient in timing and amount to settle projected future benefits. In 2016, we changed the method used to estimate the future service and interest cost components of net periodic benefit cost for our defined benefit pension and other postretirement benefit plans. Historically, we estimated the future service and interest cost components using a single weighted ‐ average discount rate derived from the yield curve that was used to measure the benefit obligation at the beginning of the period. For 2017 and beyond, we have elected to use a full yield curve approach in the estimation of these components of benefit cost by applying the specific spot rates along the yield curve used in the determination of the benefit obligation to the relevant projected cash flows. We have made this change to improve the correlation between projected benefit cash flows and the corresponding yield curve spot rates and to provide a more precise measurement of service and interest costs. This change did not affect the measurement of our total benefit obligations, as the change in the service cost and interest cost was entirely offset in the actuarial loss reported.
The expected long-term rate of return on plan assets is determined by performing a detailed analysis of key economic and market factors impacting historical returns for each asset class and formulating a projected return based on factors in the current environment. Factors considered include, but are not limited to, inflation, real economic growth, interest rate yield, interest rate spreads, and other valuation measures and market metrics. The expected long-term rate of

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return for each asset class is then weighted based on the strategic asset allocation approved by the governing body for each plan. The historical experience with the pension fund asset performance is also considered.
A one-percentage point change in the assumed health care cost trend rate would have had a nominal effect on both service and interest costs, but would result in an approximate $0.4 million impact to the projected benefit obligation.
The net periodic benefit costs for the pension and other postretirement benefit plans for the years ended December 31, 2017, 2016, and 2015 were as follows:

 	 	Defined Benefit Pension Plans	 	Other Postretirement Benefit Plans	 	
 	 	December 31,	 	December 31,	 	
 	 	2017	 	2016	 	2015	 	2017	 	2016	 	2015	 	
Net periodic benefit cost	    	 	 	    	 	 	    	 	 	    	 	 	    	 	 	    	 	 	 	
Service cost	 	$	20.5	 	$	16.5	 	$	16.6	 	$	0.2	 	$	0.2	 	$	0.3	 	
Interest cost	 	 	4.9	 	 	5.5	 	 	5.2	 	 	0.3	 	 	0.4	 	 	0.5	 	
Expected return on plan assets	 	 	(1.7)	 	 	(2.0)	 	 	(1.6)	 	 	 —	 	 	 —	 	 	 —	 	
Amortization of prior service cost (credit)	 	 	(2.0)	 	 	(1.9)	 	 	(1.6)	 	 	0.1	 	 	0.1	 	 	0.1	 	
Amortization of net (gain) loss	 	 	5.6	 	 	4.4	 	 	5.5	 	 	(0.1)	 	 	(0.2)	 	 	 —	 	
Settlement and curtailment gain	 	 	(21.9)	(1)	 	 —	 	 	 —	 	 	 —	 	 	 —	 	 	 —	 	
Net periodic benefit cost	 	$	5.4	 	$	22.5	 	$	24.1	 	$	0.5	 	$	0.5	 	$	0.9	 	
Amounts recognized in other comprehensive income (loss)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net loss (gain)	 	$	(42.6)	 	$	24.8	 	$	(6.3)	 	$	(0.1)	 	$	1.9	 	$	(1.5)	 	
Amortization of prior service (cost) credit	 	 	2.0	 	 	1.9	 	 	1.6	 	 	(0.1)	 	 	(0.1)	 	 	(0.1)	 	
Amortization of net gain (loss)	 	 	(5.6)	 	 	(4.4)	 	 	(5.5)	 	 	0.1	 	 	0.2	 	 	 —	 	
Settlement and curtailment gain	 	 	21.9	(1)  	 	 —	 	 	 —	 	 	 —	 	 	 —	 	 	 —	 	
Prior service credit	 	 	 —	 	 	 —	 	 	(3.4)	(3)  	 	 —	 	 	 —	 	 	 —	 	
Acquisitions/divestitures	 	 	 —	 	 	0.2	(2)  	 	 —	 	 	 —	 	 	(1.1)	(2)  	 	 —	 	
Total recognized in other comprehensive income (loss)	 	 	(24.3)	 	 	22.5	 	 	(13.6)	 	 	(0.1)	 	 	0.9	 	 	(1.6)	 	
Net periodic benefit cost	 	 	5.4	 	 	22.5	 	 	24.1	 	 	0.5	 	 	0.5	 	 	0.9	 	
Total recognized in net periodic benefit cost and other comprehensive income (loss)	 	$	(18.9)	 	$	45.0	 	$	10.5	 	$	0.4	 	$	1.4	 	$	(0.7)	 	

	(1)		Approximately $21.6 million of this amount relates to a curtailment gain on certain of the Company’s pension plans in Europe recorded during the year ended December 31, 2017, of which $18.5 million was recorded within “Cost of sales” and $3.1 million was recorded within “Selling, general and administrative expenses” in the consolidated statement of operations. This curtailment is triggered by a plan amendment under which participants will not receive incremental benefits under the existing plan for service provided subsequent to December 31, 2017. Previous participants in the curtailed pension plan will be eligible to participate in a new multi-employer plan starting on January 1, 2018.	
	(2)		These amounts relate to the Company’s divestiture of its Brazilian business during 2016. As of December 31, 2016, the Company had no residual AOCI balances recorded related to the Brazilian pension and postretirement medical plans.	
	(3)		This amount is primarily related to a reduction in annuity conversion rates announced by the insurance provider for the pension plans in Switzerland. The impact of the change resulted in an adjustment to prior service credit in other comprehensive income as of December 31, 2015, which will be amortized to net periodic benefit cost over the estimated remaining service period of the employees.	

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The changes in the pension benefit obligations and the fair value of plan assets and the funded status of all significant plans for the years ended December 31, 2017 and 2016 were as follows:

 	 	Defined Benefit	 	Other Postretirement	 	
 	 	Pension Plans	 	Benefit Plans	 	
 	 	December 31,	 	December 31,	 	
 	 	2017	 	2016	 	2017	 	2016	 	
Change in projected benefit obligations	    	 	 	    	 	 	    	 	 	    	 	 	 	
Benefit obligation at beginning of period	 	$	303.3	 	$	265.5	 	$	6.7	 	$	7.6	 	
Service cost	 	 	20.5	 	 	16.5	 	 	0.2	 	 	0.2	 	
Interest cost	 	 	4.9	 	 	5.5	 	 	0.3	 	 	0.4	 	
Plan participants’ contributions	 	 	2.5	 	 	2.3	 	 	 —	 	 	 —	 	
Actuarial changes in assumptions and experience	 	 	(8.2)	 	 	27.6	 	 	(0.1)	 	 	1.9	 	
Benefits paid from fund	 	 	(1.4)	 	 	0.1	 	 	 —	 	 	 —	 	
Benefit payments by employer	 	 	(1.9)	 	 	(1.9)	 	 	 —	 	 	 —	 	
Acquisitions/divestitures	 	 	 —	 	 	(0.9)	 	 	 —	 	 	(4.0)	 	
Plan amendments	 	 	 —	 	 	 —	 	 	 —	 	 	 —	 	
Curtailments	 	 	(32.6)	 	 	 —	 	 	 —	 	 	 —	 	
Settlements	 	 	(5.2)	 	 	 —	 	 	 —	 	 	 —	 	
Other	 	 	3.0	 	 	 —	 	 	 —	 	 	 —	 	
Currency impact	 	 	36.8	 	 	(11.4)	 	 	 —	 	 	0.6	 	
Benefit obligation at end of period	 	$	321.7	 	$	303.3	 	$	7.1	 	$	6.7	 	
Change in plan assets	 	 	 	 	 	 	 	 	 	 	 	 	 	
Fair value of plan assets at beginning of period	 	$	114.2	 	$	100.5	 	$	 —	 	$	 —	 	
Actual return on plan assets	 	 	3.6	 	 	4.8	 	 	 —	 	 	 —	 	
Settlements	 	 	(5.2)	 	 	 —	 	 	 —	 	 	 —	 	
Employer contributions	 	 	15.3	 	 	12.8	 	 	 —	 	 	 —	 	
Plan participants’ contributions	 	 	2.5	 	 	2.3	 	 	 —	 	 	 —	 	
Benefits paid	 	 	(3.3)	 	 	(1.8)	 	 	 —	 	 	 —	 	
Other	 	 	 —	 	 	 —	 	 	 —	 	 	 —	 	
Currency impact	 	 	13.0	 	 	(4.4)	 	 	 —	 	 	 —	 	
Fair value of plan assets at end of period	 	 	140.1	 	 	114.2	 	 	 —	 	 	 —	 	
Funded status at end of period	 	$	(181.6)	 	$	(189.1)	 	$	(7.1)	 	$	(6.7)	 	
The net amounts recognized in the consolidated balance sheets as of December 31, 2017 and 2016 were as follows:

 	 	Defined Benefit	 	Other Postretirement	 	
 	 	Pension Plans	 	Benefit Plans	 	
 	 	December 31,	 	December 31,	 	
 	 	2017	 	2016	 	2017	 	2016	 	
Net amounts recognized in the balance sheets as of December 31	    	 	 	    	 	 	    	 	 	    	 	 	 	
Current liabilities	 	$	(2.2)	 	$	(1.6)	 	$	(0.1)	 	$	(0.1)	 	
Noncurrent liabilities	 	 	(179.4)	 	 	(187.5)	 	 	(7.0)	 	 	(6.6)	 	
Net amounts recognized in the balance sheet	 	$	(181.6)	 	$	(189.1)	 	$	(7.1)	 	$	(6.7)	 	
Accumulated benefit obligation at the end of the period	 	$	290.9	 	$	245.3	 	$	7.1	 	$	6.7	 	
Pretax amounts recognized in AOCI as of December 31:	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net prior service cost (credit)	 	$	(5.4)	 	$	(21.3)	 	$	0.3	 	$	0.4	 	
Net loss (gain)	 	 	65.8	 	 	106.0	 	 	(0.9)	 	 	(0.9)	 	
Total at end of period	 	$	60.4	 	$	84.7	 	$	(0.6)	 	$	(0.5)	 	

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Approximately $3.8 million and $1.1 million of net loss and net prior service credit, respectively, for the defined benefit pension plans and less than $0.1 million and $0.1 million of net gain and net prior service cost, respectively, for other postretirement benefit plans will be amortized from AOCI to net periodic benefit cost in 2018.
The estimated future benefit payments, reflecting expected future service, as appropriate, are presented in the following table:

 	    	 	 	    	 	 	    	 	 	    	 	 	    	 	 	    	2023	    	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	through	 	 	 	 	
 	 	2018	 	2019	 	2020	 	2021	 	2022	 	2027	 	Total	 	
Defined benefit pension plans	 	$	5.4	 	$	5.1	 	$	6.1	 	$	5.5	 	$	6.2	 	$	48.1	 	$	76.4	 	
Other postretirement benefit plans	 	 	0.1	 	 	0.1	 	 	0.1	 	 	0.2	 	 	0.3	 	 	2.4	 	 	3.2	 	
Total	 	$	5.5	 	$	5.2	 	$	6.2	 	$	5.7	 	$	6.5	 	$	50.5	 	$	79.6	 	

The Company estimates it will make cash contributions, including benefit payments for unfunded plans, of $6.3 million in 2018 to the defined benefit pension plans.
The following information relates to pension plans with projected and accumulated benefit obligations in excess of the fair value of plan assets as of December 31, 2017 and 2016:

Projected Benefit Obligation	 	December 31,	 	
Exceeds the Fair Value of Plan Assets  	 	2017	 	2016	 	
Projected benefit obligations	    	$	237.3	    	$	303.3	 	
Fair value of plan assets	 	$	55.8	 	$	114.2	 	

 	 	 	 	 	 	 	 	
Accumulated Benefit Obligation	 	December 31,	 	
Exceeds the Fair Value of Plan Assets	 	2017	 	2016	 	
Accumulated benefit obligations	    	$	206.4	    	$	184.2	 	
Fair value of plan assets	 	$	50.0	 	$	45.4	 	
 
Plan Assets
As of December 31, 2017 and 2016, respectively, plan assets totaled $140.1 million and $114.2 million, consisting of investments in insurance contracts. Investments in the pension plan insurance were valued utilizing unobservable inputs, which are contractually determined based on cash surrender values, returns, fees, and the present value of the future cash flows of the contracts.
Insurance contracts are classified as Level 3 investments. Changes in the fair value of these Level 3 investments during the years ended December 31, 2017 and 2016 are included in the “Change in plan assets” table above.
Concentration of Risk
The Company mitigates the credit risk of investments by establishing guidelines with investment managers that limit investment in any single issue or issuer to an amount that is not material to the portfolio being managed. These guidelines are monitored for compliance both by the Company and external managers. Credit risk related to derivative activity is mitigated by utilizing multiple counterparties and through collateral support agreements.
Supplemental Employee Retirement Plan
The Company established a non-qualified supplemental employee retirement plan in 2010. The net benefit costs recognized for the years ended December 31, 2017, 2016, and 2015 were $1.1 million, $1.1 million, and $1.0 million, respectively. Benefit obligations under this plan were $15.3 million and $15.1 million as of December 31, 2017 and 2016, respectively. As of December 31, 2017 and 2016, the amounts of net loss included in AOCI were $0.9 million and $1.8 million, respectively, with $0.9 million and $1.0 million amortized from AOCI into net periodic benefit costs during the years ended December 31, 2017 and 2016, respectively. Approximately $0.5 million is expected to be amortized from AOCI into net periodic benefit cost in 2018.

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Based on the Company’s current estimates, the estimated future benefit payments under this plan, reflecting expected future service, as appropriate, are presented in the following table:

 	    	2018	    	2019	    	2020	    	2021	    	2022	    	Thereafter	    	Total	 	
Supplemental employee retirement plan	 	$	 —	 	$	16.0	 	$	 —	 	$	 —	 	$	 —	 	$	 —	 	$	16.0	 	
 
Defined Contribution Plans
The Company also offers defined contribution plans to eligible employees in the U.S. and in other countries, including Hong Kong, Korea, The Netherlands, Taiwan and the United Kingdom. The defined contribution plans are comprised of a non-discretionary elective matching contribution component as well as a discretionary non-elective contribution component. Employees participate in the non-discretionary component by contributing a portion of their eligible compensation to the plan, which is partially matched by the Company. Non-elective contributions are made at the discretion of the Company and are based on a combination of eligible employee compensation and performance award targets. For the years ended December 31, 2017, 2016, and 2015, respectively, the Company contributed $8.4 million, $8.6 million, and $7.8 million to the defined contribution plans.
NOTE 16—STOCK-BASED COMPENSATION
Summary of Stock-based Compensation Expense
Stock-based compensation expense, which is recorded within “Selling, general and administrative expenses” in the consolidated statements of operations, was as follows for the years ended December 31, 2017, 2016, and 2015, respectively. Share amounts in the tables below are in whole numbers, unless otherwise indicated.

 	 	 	 	 	 	 	 	 	 	 	As of	 	
 	 	 	 	 	 	 	 	 	 	 	December 31, 2017	 	
 	 	Year Ended December 31,	 	Unrecognized	 	Weighted	 	
 	 	2017	 	2016	 	2015	 	Compensation Cost	 	Average Years	 	
2014 Omnibus Plan Awards	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
RSUs	 	$	8.6	 	$	5.3	 	$	2.1	 	$	9.3	 	1.6	 	
Option Awards	 	 	4.1	 	 	5.6	 	 	3.0	 	 	1.2	 	1.3	 	
PSUs	 	 	1.1	 	 	 —	 	 	 —	 	 	2.7	 	2.1	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Restricted Stock Awards Issued by the former Parent	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Time-based Restricted Stock Awards	    	 	 —	    	 	1.7	    	 	2.6	 	 	 —	 	 —	 	
Modified Time-based Restricted Stock Awards	 	 	 —	 	 	4.5	 	 	2.4	 	 	 —	 	 —	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Management Retention Awards	 	 	 —	 	 	 —	 	 	(1.1)	 	 	 —	 	 —	 	
Total stock-based compensation expense	 	$	13.8	 	$	17.1	 	$	9.0	 	 	 	 	 	 	
2014 Omnibus Plan
In connection with the IPO, the Company’s board of directors approved the 2014 Omnibus Plan, adopted on May 28, 2014, under which 4.5 million ordinary shares is the maximum number that may be delivered upon satisfaction of awards granted. Following the IPO, all equity-based awards granted by the Company will be granted under the 2014 Omnibus Plan, which provides for awards of stock options, share appreciation rights, restricted stock, unrestricted stock, stock units, performance awards, cash awards and other awards convertible into or otherwise based on ordinary shares of the Company. Since the IPO, the board of directors of the Company has approved equity award grants for certain directors, executives, and employees, including restricted share units (RSUs), options to purchase shares (options awards), and performance share units (PSUs).

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Restricted Share Units (RSUs)
The RSUs granted to executives and employees vest in full on the third anniversary of the date of grant, generally subject to the employee remaining continuously employed by the Company through the vesting date. RSUs granted to directors of the Company vest in full on the first anniversary of the date of grant. Upon a termination of employment due to the employee’s death or retirement or a termination of employment by the Company without cause in connection with a restructuring or redundancy or due to the employee’s disability prior to the vesting date, the RSUs will vest in full or in part, depending on the type of termination. In the event employment is terminated for cause, all unvested RSUs will be forfeited. When RSUs vest, shares are issued from the existing pool of treasury shares.
Compensation cost for RSUs is measured at grant date based on the fair value of the award and is recognized ratably as expense over the applicable vesting term. The fair value of RSUs is equal to the fair market value of the Company’s ordinary shares based on the closing price on the date of grant. Prior to November 2016, dividend and dividend equivalents did not accumulate on unvested RSUs. In November 2016, the board of directors approved an amendment to all outstanding RSUs, entitling each award holder to an amount equal to any cash dividend paid by the Company upon one ordinary share for each RSU held by the award holder (“dividend equivalents”). The dividend equivalents earned on the RSUs only include dividends paid after this amendment and the award holders have no right to receive the dividend equivalents unless and until the associated RSUs vest. The dividend equivalents will be payable in cash and will not accrue interest .   The impact of this amendment is immaterial to the consolidated financial statements.
The following table summarizes the award activity for RSUs during the year ended December 31, 2017:
 	 	 	 	 	 	
 	    	 	    	Weighted-Average	
 	 	 	 	Grant Date	
Restricted Share Units	 	Shares	 	Fair Value per Share	
Unvested, December 31, 2016	 	722,783	 	$	22.88	
Granted	 	110,767	 	 	70.85	
Vested	 	(50,331)	 	 	26.01	
Forfeited	 	(39,379)	 	 	28.67	
Unvested, December 31, 2017	 	743,840	 	$	29.50	

The following table summarizes the weighted-average grant date fair value per share of RSUs granted during the years ended December 31, 2017, 2016, and 2015 as well as the total fair value of awards vested during those periods:

 	 	Restricted Share Units	 	
 	    	Weighted-Average Grant Date	    	Total Fair Value	 	
 	 	Fair Value per Share	 	of Awards Vested	 	
 	 	of Grants during Period	 	during Period	 	
Year Ended December 31, 2017	 	$	70.85	 	$	1.3	 	
Year Ended December 31, 2016	 	$	28.39	 	$	0.5	 	
Year Ended December 31, 2015	 	$	18.67	 	$	0.2	 	
Option Awards
The option awards, which contain an exercise term of nine years from the date of grant, vest in three equal annual installments beginning on the first anniversary of the date of grant, generally subject to the employee remaining continuously employed on the applicable vesting date. Upon a termination of employment due to the employee’s death or retirement or a termination of employment by the Company without cause in connection with a restructuring or redundancy or due to the employee’s disability prior to a vesting date, the option awards will vest in full or will continue to vest on the original vesting schedule, depending on the type of termination. In the event employment is terminated for cause, all vested and unvested option awards will be forfeited. When option awards are exercised, shares are issued from the existing pool of treasury shares.

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Compensation cost for option awards is measured at the grant date based on the fair value of the award and is recognized as expense over the appropriate service period utilizing graded vesting.  The following table summarizes the activity for option awards during the years ended December 31, 2017, 2016 and 2015:

 	    	 	    	Weighted-Average	 	Weighted-Average	 	Aggregate	
 	 	 	 	Exercise Price	 	Contractual	 	Intrinsic	
Option Awards	 	Shares	 	per share	 	Term (years)	 	Value	
Outstanding as of December 31, 2014	 	 —	 	$	 —	 	 	 	 	 	 	
Granted	 	607,382	 	 	18.20	 	 	 	 	 	 	
Exercised	 	 —	 	 	 —	 	 	 	 	 	 	
Forfeited	 	(48,641)	 	 	18.14	 	 	 	 	 	 	
Outstanding as of December 31, 2015	 	558,741	 	$	18.20	 	 	 	 	 	 	
Granted	 	569,281	 	 	27.96	 	 	 	 	 	 	
Exercised	 	(11,562)	 	 	18.46	 	 	 	 	 	 	
Forfeited	 	(6,160)	 	 	22.90	 	 	 	 	 	 	
Outstanding as of December 31, 2016	 	1,110,300	 	$	23.18	 	 	 	 	 	 	
Granted	 	192,546	 	 	71.43	 	 	 	 	 	 	
Exercised	 	(446,715)	 	 	20.75	 	 	 	 	 	 	
Forfeited	 	(2,037)	 	 	46.21	 	 	 	 	 	 	
Outstanding as of December 31, 2017	 	854,094	 	$	35.27	 	 	
7.1	 	$	31.9	
Exercisable as of December 31, 2017	 	101,396	 	$	25.13	 	 	
6.8	 	$	4.8	
Expected to vest as of December 31, 2017	 	752,698	 	$	36.64	 	 	
7.2	 	$	27.1	

The range of exercise prices for the above option awards outstanding at December 31, 2017 is from $18.14 to $71.45. During the years ended December 31, 2017 and 2016, the Company received cash of $9.3 million and $0.2 million, respectively, from the exercise of option awards and the total intrinsic value of option awards exercised was $21.4 million and $0.4 million, respectively (noting no option awards were exercised in 2015).
The fair value for option awards is computed using the Black-Scholes pricing model, whose inputs and assumptions are determined as of the date of grant. Determining the fair value of the option awards requires considerable judgment, including estimating the expected term of said awards and the expected volatility of the price of the Company’s ordinary shares.
Since the Company’s equity interests were privately held prior to the IPO in June 2014, there is limited publicly traded history of the Company’s ordinary shares. Until such time that the Company can determine expected volatility based solely on the publicly traded history of its ordinary shares, expected volatility used in the Black-Scholes model for option awards granted is based on a combination of the Company’s historical volatility and similar companies’ stock that are publicly traded. The expected term of option awards represents the period of time that option awards granted are expected to be outstanding. For all grants of option awards presented herein, the simplified method was used to calculate the expected term, given the Company’s limited historical exercise data. The risk-free interest rate for the periods within the expected term of option awards is based on the U.S. Treasury yield curve in effect at the time of grant. The dividend yield is estimated based on historical and expected dividend activity.
The following are the weighted-average assumptions used within the Black-Scholes pricing model for grants during the years ended December 31, 2017, 2016 and 2015:

 	 	Year Ended	 	
 	 	December 31, 	 	
 	    	2017	 	2016	 	2015	 	
Expected term (in years)	 	5.50	 	5.50	 	5.50	 	
Expected volatility	 	35.00	%	40.00	%	45.00	%	
Risk-free interest rate	 	2.19	%	1.42	%	1.65	%	
Dividend yield	 	2.00	%  	0.60	%  	 —	 	
Utilizing the above assumptions, the weighted-average grant date fair value per option award granted in the years ended December 31, 2017, 2016 and 2015 was $20.61, $10.10 and $7.82, respectively.

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Performance Share Units (PSUs)
The Company granted PSUs for the first time during the year ended December 31, 2017. The PSUs, which are granted to executives, cliff vest on the third anniversary of the date of grant, generally subject to the executive remaining continuously employed by the Company through the vesting date and achieving certain performance conditions. The number of the PSUs that vest upon completion of the service period can range from 0 to 200 percent of the original grant, subject to certain limitations, contingent upon the Company’s total shareholder return (“TSR”) during the performance period relative to a pre-defined set of industry peer companies. Upon a termination of employment due to the executive’s death or retirement, or termination in connection with a change in control or other factors prior to the vesting date, the PSUs will vest in full or in part, depending on the type of termination and the achievement of the performance conditions. Dividend equivalents will accumulate on PSUs during the vesting period, will be paid in cash upon vesting, and do not accrue interest. When PSUs vest, shares will be issued from the existing pool of treasury shares. During the year ended December 31, 2017, a total of 50,937 PSUs were granted at a weighted-average fair value of $75.74 per award. No PSUs vested or were forfeited during the period.
The fair value for PSU awards is computed using a Monte Carlo valuation model, whose inputs and assumptions are determined as of the date of grant. Determining the fair value of the PSU awards requires considerable judgment, including estimating the expected volatility of the price of the Company’s ordinary shares, the correlation between the Company’s stock price and that of its peer companies, and the expected rate of interest. The expected volatility for each grant is determined based on the historical volatility of the Company’s common stock. The expected term of PSU awards represents the length of the performance period. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant for a duration equivalent to the performance period. The stock price is the closing price of the Company’s common stock on the grant date.
The following are the weighted-average assumptions used within the Monte Carlo valuation model for grants during the year ended December 31, 2017:

 	 	 	Year Ended	 	 	
 	 	 	December 31, 	 	 	
 	 	    	2017	 	 	
Expected term (in years)	 	 	3.00	 	 	
Expected volatility	 	 	39.00	%	 	
Risk-free interest rate	 	 	1.56	%	 	
Stock Price	 	$	71.45	 	 	
Utilizing the above assumptions, the total grant date fair value for PSU awards granted in the year ended December 31, 2017 was $3.9 million.
Restricted Stock Awards issued by the former Parent
On June 17, 2010, the former Parent authorized the issuance of up to 750,000 of its shares in restricted stock awards to certain key members of management. Any related compensation associated with these awards has since been allocated to the Company from the former Parent. Since the adoption of the 2014 Omnibus Plan in May 2014, discussed further above, restricted stock awards are no longer issued by the former Parent on behalf of the Company.  
During the year ended December 31, 2016, the former Parent completed the sale of its ordinary shares of the Company through secondary offerings, and as a result, no longer holds an ownership interest in the Company. Given that the former Parent sold its interest in the substantive assets of the Company, under the terms of the related securityholder agreements, vesting of all outstanding restricted stock awards was fully accelerated into the year ended December 31, 2016. There will be no additional grants or expense related to these awards in future periods.
Time-based Restricted Stock Awards
Prior to the full acceleration of vesting in 2016 noted above, the time-based restricted stock awards issued by the former Parent contained a service-based condition that required continued employment with the Company. Generally, these awards were to vest over three to five years of service, with a portion (20% to 40%) cliff vesting after the first one or two years, and the remaining portion vesting ratably over the subsequent service period. Compensation cost for the

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time-based restricted stock awards was measured at the grant date based on the fair value of the award and was recognized as expense over the appropriate service period utilizing graded vesting . 

The following table summarizes the weighted-average grant date fair value per share of time-based restricted stock awards granted during the years ended December 31, 2016 and 2015, as well as the total fair value of awards vested during those periods:  

 	 	Time-Based Restricted Stock	 	
 	    	Weighted-Average Grant Date	    	Total Fair Value	 	
 	 	Fair Value per Share	 	of Awards Vested	 	
 	 	of Grants during Period	 	during Period	 	
Year Ended December 31, 2016	 	 	N/A	(1)   	$	4.7	 	
Year Ended December 31, 2015	 	 	N/A	(1)   	$	5.1	 	

	(1)		There were no grants of time-based restricted stock awards by the former Parent during the years ended December 31, 2016 and 2015 as a result of the adoption of the 2014 Omnibus Plan.	
Modified Time-based Restricted Stock Awards
Prior to June 2014, the former Parent had issued performance-based restricted stock awards that contained provisions wherein vesting was subject to the full satisfaction of both time and performance vesting criterion. On June 10, 2014, prior to the completion of the Company’s IPO, the former Parent entered into agreements to modify the outstanding performance-based restricted stock awards to remove the performance-based vesting condition associated with such awards related to the achievement of certain investment returns (while maintaining the requirement for a change in control or IPO). This modification also changed the time-based vesting requirement associated with such awards to provide that any shares which would have satisfied the time-based vesting condition previously applicable on or prior to June 30, 2017 to instead vest on June 30, 2017, subject to the holder remaining continuously employed by the Company through such date. Any such awards that were subject to a time-based vesting condition beyond June 30, 2017 remained subject to those previous conditions. Henceforth, these awards have been described as modified time-based restricted stock awards.  
With the completion of the Company’s IPO in June 2014, the remaining performance condition associated with these modified time-based restricted stock awards was achieved. As a result, the Company began recognizing compensation expense on these awards, which was measured at the modification date based on their fair value. P rior to the full acceleration of vesting in 2016 noted above, compensation expense on these awards wa s being recognized over the appropriate service period utilizing graded vesting.
 
The following table summarizes the weighted-average grant date fair value per share of modified time-based restricted stock awards granted during the years ended December 31, 2016 and 2015, as well as the total fair value of awards vested during those periods:  

 	 	Modified Time-Based Restricted Stock	 	
 	    	Weighted-Average Grant Date	    	Total Fair Value	 	
 	 	Fair Value per Share	 	of Awards Vested	 	
 	 	of Grants during Period	 	during Period	 	
Year Ended December 31, 2016	 	 	N/A	(1)   	$	8.5	 	
Year Ended December 31, 2015	 	 	N/A	(1)   	$	0.3	 	

	(1)		There were no grants of modified time-based restricted stock awards by the former Parent during the years ended December 31, 2016 and 2015 as a result of the adoption of the 2014 Omnibus Plan .  	
 
Adoption of Accounting Standards Update  
Effective April 1, 2016, the Company adopted new accounting guidance issued by the FASB that simplifies several aspects of accounting for share-based payments. Among other things , as part of this adoption, the Company made an accounting policy election to recognize forfeitures as incurred, rather than estimating the forfeitures in advance.  The

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impact of this change was applied utilizing a modified retrospective approach, with an adjustment of $0.9 million recorded during the year ended December 31, 2016 to decrease opening retained earnings and increase opening additional paid-in-capital. All other impacts of this adoption were not material to the Company’s financial position and results of operations.
 
NOTE 17—RELATED PARTY AND DOW TRANSACTIONS
Related Party Transactions
During the year ended December 31, 2016, the former Parent sold 37,269,567 ordinary shares pursuant to the Company’s shelf registration statement filed with the SEC. As such, the former Parent no longer holds an ownership interest in the Company. In connection with these offerings, the Company incurred advisory, accounting, legal and printing expenses on behalf of the former Parent of $2.5 million during the year ended December 31, 2016. These expenses were included within “Selling, general and administrative expenses” in the consolidated statement of operations.
Dow Transactions
The Company has entered into certain agreements with Dow, including the Second Amended and Restated Master Outsourcing Services Agreement, which was modified on June 1, 2013 (or SAR MOSA), site and operating services agreements, and supply agreements.
The SAR MOSA provides for ongoing worldwide services from Dow in areas such as information technology, enterprise resource planning, finance, environmental health and safety, training, customer service, marketing and sales support, supply chain and certain sourcing and transactional procurement services. This agreement is effective through December 31, 2020, with automatic two year renewals, barring six months’ notice of non-renewal provided by either party. Subsequent to June 1, 2015, the Company has the ability to terminate all or a portion of the services under the SAR MOSA, subject to payment of termination charges, noting that certain ‘highly integrated’ services follow a separate process for evaluation and termination. Either party may terminate for cause, which includes a bankruptcy, liquidation or similar proceeding by the other party, for material breach which is not cured. Dow has the right to terminate the agreement in the event of failure by the Company to pay for the services or in the event of a change of control, as defined in the agreement. As of December 31, 2017, the Company’s estimated minimum contractual obligations under the SAR MOSA are approximately $16.9 million.
In addition, the Company entered into various site service agreements with Dow, as amended June 1, 2013 (the Second Amended and Restated Site Services Agreements, or SAR SSAs). Under the SAR SSAs, general site services are provided at specific facilities co-located with Dow including utilities, site administration, environmental health and safety, site maintenance and supply chain. Conversely, the Company entered into similar agreements with Dow, where at Company-owned sites, it provides such services to Dow. These agreements generally have 25-year terms from the date amended, with options to renew. These agreements may be terminated at any time by agreement of the parties, or, by either party, for cause, including a bankruptcy, liquidation or similar proceeding by the other party, or under certain circumstances for a material breach which is not cured. In addition, the Company may terminate for convenience any services that Dow has agreed to provide that are identified in any site services agreement as “terminable” with 12 months prior notice to Dow, dependent upon whether the service is highly integrated into Dow operations. Highly integrated services are agreed to be nonterminable. With respect to “nonterminable” services that Dow has agreed to provide to the Company, such as electricity and steam, the Company generally cannot terminate such services prior to the termination date unless the Company experiences a production unit shut down for which Dow is provided with 15-months prior notice, or upon payment of a shutdown fee. Upon expiration or termination, the Company would be obligated to pay a monthly fee to Dow, which obligation extends for a period of 45 (in the case of expiration) to 60 months (in the case of termination) following the respective event of each site services agreement. The agreements under which Dow receives services from the Company may be terminated under the same circumstances and conditions.

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The following tables detail expenses incurred during the years ended December 31, 2017, 2016, and 2015 under the SAR MOSA and SAR SSAs by financial statement line item:

 	 	Year Ended December 31, 2017	
Financial Statement Line Item	    	SAR MOSA	    	SAR SSAs	    	Total	
Cost of sales	    	$	39.8	    	$	179.2	    	$	219.0	
Selling, general, and administrative expenses	 	 	9.3	 	 	4.1	 	 	13.4	
Total	 	$	49.1	 	$	183.3	 	$	232.4	

 	 	 	 	 	 	 	 	 	 	
 	 	Year Ended December 31, 2016	
Financial Statement Line Item	    	SAR MOSA	    	SAR SSAs	    	Total	
Cost of sales	    	$	41.7	    	$	169.9	    	$	211.6	
Selling, general, and administrative expenses	 	 	5.6	 	 	4.9	 	 	10.5	
Total	 	$	47.3	 	$	174.8	 	$	222.1	

 	 	 	 	 	 	 	 	 	 	
 	 	Year Ended December 31, 2015	
Financial Statement Line Item	    	SAR MOSA	    	SAR SSAs	    	Total	
Cost of sales	    	$	42.9	    	$	188.6	    	$	231.5	
Selling, general, and administrative expenses	 	 	5.1	 	 	5.5	 	 	10.6	
Total	 	$	48.0	 	$	194.1	 	$	242.1	
The Company has transactions in the normal course of business with Dow and its affiliates. For the years ended December 31, 2017, 2016, and 2015, sales to Dow and its affiliated companies were approximately $235.2 million, $203.5 million, and $227.0 million, respectively. For the years ended December 31, 2017, 2016, and 2015, purchases from Dow and its affiliated companies were approximately $1,357.2 million, $1,090.4 million, and $1,244.2 million, respectively.
 
NOTE 18—SEGMENTS
The Company operates under two divisions: Performance Materials and Basic Plastics & Feedstocks. The Performance Materials division includes the following reporting segments: Latex Binders, Synthetic Rubber, and Performance Plastics. The Basic Plastics & Feedstocks division includes the following reporting segments: Basic Plastics, Feedstocks, and Americas Styrenics.
The Latex Binders segment produces SB latex and other latex polymers and binders, primarily for coated paper and packaging board, carpet and artificial turf backings, as well as a number of performance latex binders applications, such as adhesive, building and construction and the technical textile paper market. The Synthetic Rubber segment produces synthetic rubber products used predominantly in high-performance tires, impact modifiers and technical rubber products, such as conveyer belts, hoses, seals and gaskets. The Performance Plastics segment produces highly engineered compounds and blends and some specialized ABS grades for automotive end markets, as well as consumer electronics, medical, electrical and lighting, collectively consumer essential markets, or CEM. The Basic Plastics segment produces styrenic polymers, including polystyrene, basic ABS, and SAN products, as well as PC, all of which are used as inputs in a variety of end use markets.  The Basic Plastics segment also included the results of our 50%-owned joint venture, Sumika Styron Polycarbonate, until the Company sold its share in the entity in January 2017 (refer to Note 4 for further information). The Feedstocks segment includes the Company’s production and procurement of styrene monomer outside of North America, which is used as a key raw material in many of the Company’s products, including polystyrene, SB latex, ABS resins, SSBR, etc.  Lastly, the Americas Styrenics segment consists solely of the operations of our 50%-owned joint venture, Americas Styrenics, a producer of both styrene monomer and polystyrene in North America.
Asset, capital expenditure, and intersegment sales information is not reviewed or included with the Company’s reporting to the chief operating decision maker. Therefore, the Company has not disclosed this information for each reportable segment.

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 	 	Performance Materials	 	Basic Plastics & Feedstocks	 	 	 	 	 	 	 	
 	 	Latex	 	Synthetic	 	Performance	 	Basic	 	 	 	Americas	 	Corporate	 	 	 	 	
Year Ended	 	Binders	 	Rubber	 	Plastics	 	Plastics	 	Feedstocks	 	Styrenics	 	Unallocated	 	Total	 	
December 31, 2017	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	  	 	 	 	
Sales to external customers	 	$	1,097.1	 	$	582.8	 	$	808.3	 	$	1,552.2	 	$	407.7	 	$	 —	 	$	 —	 	$	4,448.1	 	
Equity in earnings (losses) of unconsolidated affiliates	 	 	 —	 	 	 —	 	 	 —	 	 	0.8	 	 	 —	 	 	122.9	 	 	 —	 	 	123.7	 	
Adjusted EBITDA (1)	 	 	138.5	 	 	83.3	 	 	122.4	 	 	156.7	 	 	110.5	 	 	122.9	 	 	 	 	 	 	 	
Investment in unconsolidated affiliates	 	 	 —	 	 	 —	 	 	 —	 	 	 —	 	 	 —	 	 	152.5	 	 	 —	 	 	152.5	 	
Depreciation and amortization	 	 	23.6	 	 	35.7	 	 	13.2	 	 	16.6	 	 	12.6	 	 	 —	 	 	8.9	 	 	110.6	 	
December 31, 2016	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Sales to external customers	 	$	925.3	 	$	450.7	 	$	693.4	 	$	1,352.7	 	$	294.5	 	$	 —	 	$	 —	 	$	3,716.6	 	
Equity in earnings (losses) of unconsolidated affiliates	 	 	 —	 	 	 —	 	 	 —	 	 	8.9	 	 	 —	 	 	135.8	 	 	 —	 	 	144.7	 	
Adjusted EBITDA (1)	 	 	94.3	 	 	110.9	 	 	136.2	 	 	148.2	 	 	80.2	 	 	135.8	 	 	 	 	 	 	 	
Investment in unconsolidated affiliates	 	 	 —	 	 	 —	 	 	 —	 	 	41.7	 	 	 —	 	 	149.7	 	 	 —	 	 	191.4	 	
Depreciation and amortization	 	 	23.8	 	 	34.7	 	 	6.1	 	 	15.7	 	 	10.6	 	 	 —	 	 	5.5	 	 	96.4	 	
December 31, 2015	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Sales to external customers	 	$	966.2	 	$	474.6	 	$	742.8	 	$	1,478.1	 	$	310.2	 	$	 —	 	$	 —	 	$	3,971.9	 	
Equity in earnings (losses) of unconsolidated affiliates	 	 	 —	 	 	 —	 	 	 —	 	 	4.9	 	 	 —	 	 	135.3	 	 	 —	 	 	140.2	 	
Adjusted EBITDA (1)	 	 	79.0	 	 	93.0	 	 	107.6	 	 	115.6	 	 	51.3	 	 	135.3	 	 	 	 	 	 	 	
Investment in unconsolidated affiliates	 	 	 —	 	 	 —	 	 	 —	 	 	39.0	 	 	 —	 	 	143.9	 	 	 —	 	 	182.9	 	
Depreciation and amortization	 	 	32.4	 	 	30.4	 	 	5.6	 	 	15.3	 	 	10.0	 	 	 —	 	 	3.1	 	 	96.8	 	

	(1)		The Company’s primary measure of segment operating performance is Adjusted EBITDA, which is defined as income from continuing operations before interest expense, net; provision for income taxes; depreciation and amortization expense; loss on extinguishment of long-term debt; asset impairment charges; gains or losses on the dispositions of businesses and assets; restructuring; acquisition related costs and other items. Segment Adjusted EBITDA is a key metric that is used by management to evaluate business performance in comparison to budgets, forecasts, and prior year financial results, providing a measure that management believes reflects core operating performance by removing the impact of transactions and events that would not be considered a part of core operations. Other companies in the industry may define Segment Adjusted EBITDA differently than the Company, and as a result, it may be difficult to use Segment Adjusted EBITDA, or similarly-named financial measures, that other companies may use to compare the performance of those companies to the Company’s segment performance.	
The reconciliation of income (loss) before income taxes to Segment Adjusted EBITDA is as follows:

 	 	 	 	
 	 	Year Ended December 31,	 	
 	    	2017	    	2016	 	2015	 	
Income before income taxes	 	$	411.1	 	$	405.3	 	$	203.8	 	
Interest expense, net	 	 	70.1	 	 	75.0	 	 	93.2	 	
Depreciation and amortization	 	 	110.6	 	 	96.4	 	 	96.8	 	
Corporate Unallocated (2)	 	 	91.8	 	 	94.8	 	 	89.8	 	
Adjusted EBITDA Addbacks (3)	 	 	50.7	 	 	34.2	 	 	98.2	 	
Segment Adjusted EBITDA	 	$	734.3	 	$	705.7	 	$	581.8	 	
 
(2)     Corporate unallocated includes corporate overhead costs and certain other income and expenses.

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(3)     Adjusted EBITDA addbacks for the years ended December 31, 2017, 2016, and 2015 are as follows:

 	 	Year Ended December 31,	 	
 	    	2017	    	2016	 	2015	 	
Loss on extinguishment of long-term debt (Note 10)	 	$	65.3	 	$	 —	 	$	95.2	 	
Net loss (gain) on disposition of businesses and assets (Notes 3 and 4)	 	 	(9.7)	 	 	15.1	 	 	 —	 	
Restructuring and other charges (Note 19)	 	 	6.0	 	 	23.5	 	 	0.8	 	
Acquisition transaction and integration costs (Note 3)	 	 	4.7	 	 	 —	 	 	 —	 	
Asset impairment charges or write-offs (a)	 	 	4.3	 	 	 —	 	 	 —	 	
Other items (b)	 	 	(19.9)	 	 	(4.4)	 	 	2.2	 	
Total Adjusted EBITDA Addbacks	 	$	50.7	 	$	34.2	 	$	98.2	 	
 
	(a)		Asset impairment charges for the year ended December 31, 2017 primarily related to the impairment of certain long-lived assets within the Company’s Performance Plastics segment.	
	(b)		Other items for the year ended December 31, 2017 primarily relate to a curtailment gain recorded on certain of the Company’s pension plans in Europe (refer to Note 15 for further information), offset by fees incurred in conjunction with the Company’s debt refinancing which was completed during the third quarter of 2017 . For the year ended December 31, 2016, other items include other income of $6.9 million from the effective settlement of certain value-added tax positions, offset by $2.5 million of fees incurred in conjunction with the Company’s secondary offerings completed during the year. For the year ended December 31, 2015, other items represents costs related to the process of changing our corporate name from Styron to Trinseo.	
 
Geographic Information
As of December 31, 2017, the Company operates 30 manufacturing plants (which include a total of 75 production units) at 23 sites in 12 countries, inclusive of joint ventures and contract manufacturers as well as 11 R&D facilities globally, including mini plants, development centers and pilot coaters. Sales are attributed to geographic areas based on the location where sales originated; long-lived assets are attributed to geographic areas based on asset location. The Company is incorporated under the existing laws of the Grand Duchy of Luxembourg, as discussed in Note 1, which therefore represents its country of domicile. The Company has no existing long-lived assets or sales generated from this country.

 	 	As of and for the Year Ended	 	
 	 	December 31,	 	
 	 	2017	 	2016	 	2015	 	
United States	    	 	    	    	 	    	    	 	    	 	
Sales to external customers	 	$	602.7	 	$	538.4	 	$	551.8	 	
Long-lived assets	 	 	43.2	 	 	49.2	 	 	51.2	 	
Europe	 	 	 	 	 	 	 	 	 	 	
Sales to external customers	 	$	2,688.9	 	$	2,229.5	 	$	2,373.2	 	
Long-lived assets	 	 	449.3	 	 	338.7	 	 	355.0	 	
Asia-Pacific	 	 	 	 	 	 	 	 	 	 	
Sales to external customers	 	$	1,051.4	 	$	811.8	 	$	889.5	 	
Long-lived assets	 	 	134.4	 	 	121.9	 	 	104.4	 	
Rest of World	 	 	 	 	 	 	 	 	 	 	
Sales to external customers	 	$	105.1	 	$	136.9	 	$	157.4	 	
Long-lived assets	 	 	0.1	 	 	0.2	 	 	8.1	 	
Total	 	 	 	 	 	 	 	 	 	 	
Sales to external customers (1)	 	$	4,448.1	 	$	3,716.6	 	$	3,971.9	 	
Long-lived assets (2)(3)	 	 	627.0	 	 	510.0	 	 	518.7	 	

	(1)		Sales to external customers in China represented approximately 7%, 8% and 7% of the total for the years ended December 31, 2017, 2016, and 2015, respectively. Sales to external customers in Germany represented	

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approximately 10%, 11% and 11% of the total for the years ended December 31, 2017, 2016, and 2015, respectively. Sales to external customers in Hong Kong represented approximately 13%, 10% and 11% of the total for the years ended December 31, 2017, 2016, and 2015, respectively.	
	(2)		Long-lived assets in China represented approximately 13%, 14%, and 8% of the total as of December 31, 2017, 2016, and 2015, respectively. Long-lived assets in Germany represented approximately 45%, 42%, and 42% of the total as of December 31, 2017, 2016, and 2015, respectively. Long-lived assets in The Netherlands represented approximately 15%, 14%, and 14% of the total as of December 31, 2017, 2016, and 2015, respectively.	
	(3)		Long-lived assets consist of property, plant and equipment, net.	
 
New Segmentation
Effective for the first quarter of 2018, the Company realigned its reporting segments to reflect the new model under which the business will be managed and results will be reviewed by the chief executive officer, who is the Company’s chief operating decision maker. Under this new segmentation, we will continue to report operating results for six segments, four of which will remain unchanged from the Company’s current segmentation: Latex Binders, Synthetic Rubber, Feedstocks, and Americas Styrenics. The results of our Polystyrene business, which is currently included within the results of the Basic Plastics segment, will now be reported as a standalone segment. Performance Plastics, which previously consisted of compounds, blends, and ABS products sold to the automotive market, will now also include the remaining portion of our ABS business, as well as the results of our SAN and polycarbonate businesses. This segmentation change will provide enhanced clarity to investors by concentrating the Company’s more specialized plastics into a single reporting segment, while also reducing complexity as polycarbonate and ABS are the primary inputs into the downstream production of our compounds and blends. The Company’s quarterly report on Form 10-Q for the quarter ended March 31, 2018 will be presented under this new segmentation.

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NOTE 19—RESTRUCTURING
Refer to the narrative below for discussion of the Company’s restructuring activities included in the tables below. Restructuring charges are included within “Selling, general and administrative expenses” in the consolidated statement of operations. The following table provides detail of the Company’s restructuring charges for the years ended December 31, 2017, 2016, and 2015, respectively:

 	 	 	 	 	 	 	 	 	 	 	Cumulative	 	 	 	
 	 	Year Ended December 31,	 	Life-to-date	 	 	 	
 	 	2017	 	2016	    	2015	    	Charges	    	Segment	 	
Terneuzen Compounding Restructuring	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Asset impairment/accelerated depreciation	 	$	
2.0	 	$	 —	 	$	 —	 	$	2.0	 	 	 	
Employee termination benefits	 	 	
0.5	 	 	 —	 	 	 —	 	 	0.5	 	 	 	
Contract terminations	 	 	
0.6	 	 	 —	 	 	 —	 	 	0.6	 	 	 	
Decommissioning and other	 	 	
0.2	 	 	
0.6	 	 	 —	 	 	0.8	 	 	 	
Terneuzen Subtotal	 	$	
3.3	 	$	
0.6	 	$	 —	 	$	3.9	 	Performance Plastics	 	
Livorno Plant Restructuring	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Asset impairment/accelerated depreciation	 	$	 —	 	$	
14.3	 	$	 —	 	$	14.3	 	 	 	
Employee termination benefits	 	 	
0.8	 	 	
4.6	 	 	 —	 	 	5.4	 	 	 	
Contract terminations	 	 	 —	 	 	
0.3	 	 	 —	 	 	0.3	 	 	 	
Decommissioning and other	 	 	
2.3	 	 	
0.7	 	 	 —	 	 	3.0	 	 	 	
Livorno Subtotal	 	$	
3.1	 	$	19.9	 	$	 —	 	$	23.0	 	Latex Binders	 	
Allyn's Point Restructuring	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Asset impairment/accelerated depreciation	 	$	 —	 	$	
0.6	 	$	
6.7	 	$	7.3	 	 	 	
Employee termination benefits	 	 	 —	 	 	
0.4	 	 	
0.4	 	 	0.8	 	 	 	
Contract terminations	 	 	 —	 	 	 —	 	 	 —	 	 	 —	 	 	 	
Decommissioning and other	 	 	
0.4	 	 	
1.7	 	 	 —	 	 	2.1	 	 	 	
Allyn's Point Subtotal	 	$	
0.4	 	$	
2.7	 	$	
7.1	 	$	10.2	 	Latex Binders	 	
Other Restructurings	 	 	
1.2	 	 	
0.7	 	 	
1.1	 	 	 	 	Various	 	
Total Restructuring Charges	 	$	
8.0	 	$	
23.9	 	$	
8.2	 	 	 	 	 	 	
The following tables provides a rollforward of the liability balances associated with the Company’s restructuring activities as of December 31, 2017 and 2016. Employee termination benefit and contract termination charges are recorded within “Accrued expenses and other current liabilities” in the consolidated balance sheets. No individual restructuring activity had a material liability balance as of December 31, 2017 or 2016.

 	    	Balance at	    	 	 	    	 	 	    	Balance at	 	
 	    	December 31, 2016	    	Expenses 	    	Deductions (1)	    	December 31, 2017	  	
Employee termination benefits	 	$	5.0	 	$	2.9	 	$	(6.5)	 	$	1.4	 	
Contract terminations	 	 	0.3	 	 	0.6	 	 	(0.3)	 	 	0.6	 	
Decommissioning and other	 	 	 —	 	 	3.2	 	 	(3.2)	 	 	 —	 	
Total	 	$	5.3	 	$	6.7	 	$	(10.0)	 	$	2.0	 	

 	    	Balance at	    	 	 	    	 	 	    	Balance at	 	
 	    	December 31, 2015	    	Expenses	    	Deductions (1)	    	December 31, 2016	 	
Employee termination benefits	 	$	0.4	 	$	5.7	 	$	(1.1)	 	$	5.0	 	
Contract terminations	 	 	 —	 	 	0.3	 	 	 —	 	 	0.3	 	
Decommissioning and other	 	 	 —	 	 	2.3	 	 	(2.3)	 	 	 —	 	
Total	 	$	0.4	 	$	8.3	 	$	(3.4)	 	$	5.3	 	

	(1)		Includes primarily payments made against the existing accrual, as well as immaterial impacts of foreign currency remeasurement.	

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Terneuzen Compounding Restructuring
In March 2017, the Company announced plans to upgrade its production capability for compounded resins with the construction of a new state-of-the art compounding facility to replace its existing compounding facility in Terneuzen, The Netherlands. The new facility is expected to start up by the end of 2018, with substantive production at the existing facility expected to cease by December 2018, followed by decommissioning activities in 2019.
The Company expects to incur incremental accelerated depreciation charges of approximately $1.1 million through the end of 2018, as well as estimated decommissioning and other charges of approximately $1.1 million throughout 2019, the majority of which are expected to be paid in late 2018 and throughout 2019.
Livorno Plant Restructuring
In August 2016, the Company announced its plan to cease manufacturing activities at its latex binders manufacturing facility in Livorno, Italy. This is a result of declining demand for graphical paper and is expected to provide improved asset utilization, as well as cost reductions within the Company’s European latex binders business. Production at the facility ceased in October 2016, followed by decommissioning activities which began in the fourth quarter of 2016.  
The Company does not expect to incur additional employee termination benefit charges related to this restructuring. The Company expects to incur additional decommissioning costs associated with this plant shutdown in 2018, the cost of which will be expensed as incurred.
Allyn’s Point Plant Shutdown
In September 2015, the Company approved the plan to close its Allyn’s Point latex binders manufacturing facility in Gales Ferry, Connecticut. This restructuring plan was a strategic business decision to improve the results of the overall Latex Binders segment due to continuing declines in the coated paper industry in North America. Production at the facility ceased at the end of 2015, followed by decommissioning activities which began in 2016.
The Company does not expect to incur additional employee termination benefit charges related to this restructuring. The Company expects to incur a limited amount of decommissioning costs associated with this plant shutdown in 2018, the cost of which will be expensed as incurred.
NOTE 20—ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)
The components of accumulated other comprehensive income (loss), net of income taxes, consisted of:

 	    	Cumulative	    	Pension & Other	    	 	 	 	 	 	
 	 	Translation	 	Postretirement Benefit	 	Cash Flow	 	 	 	 	
Years Ended December 31, 2017, 2016, and 2015	 	Adjustments	    	Plans, Net	    	Hedges, Net	    	Total	 	
Balance at December 31, 2014	 	$	(17.8)	 	$	(57.5)	 	$	 —	 	$	(75.3)	 	
Other comprehensive income (loss)	 	 	(91.4)	 	 	7.9	 	 	6.1	 	 	(77.4)	 	
Amounts reclassified from AOCI to net income (1)	 	 	 —	 	 	3.4	 	 	(0.5)	 	 	2.9	 	
Balance at December 31, 2015	 	$	(109.2)	 	$	(46.2)	 	$	5.6	 	$	(149.8)	 	
Other comprehensive income (loss)	 	 	(9.8)	 	 	(20.6)	 	 	9.5	 	 	(20.9)	 	
Amounts reclassified from AOCI to net income (1)	 	 	 —	 	 	3.3	 	 	(2.8)	 	 	0.5	 	
Balance at December 31, 2016	 	$	(119.0)	 	$	(63.5)	 	$	12.3	 	$	(170.2)	 	
Other comprehensive income (loss)	 	 	24.5	 	 	31.8	 	 	(20.7)	 	 	35.6	 	
Amounts reclassified from AOCI to net income (1)	 	 	 —	 	 	(13.3)	 	 	2.3	 	 	(11.0)	 	
Balance at December 31, 2017	 	$	(94.5)	 	$	(45.0)	 	$	(6.1)	 	$	(145.6)	 	

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	(1)		The following is a summary of amounts reclassified from AOCI to net income for the years ended December 31, 2017, 2016, and 2015:	
 	 	 	 	 	 	 	 	 	 	 	 	
 	 	Amount Reclassified from AOCI	 	 	
AOCI Components	    	Year Ended December 31,	 	Statement of Operations	
 	 	2017	    	2016	    	2015	    	Classification	
Cash flow hedging items	 	 	 	 	 	 	 	 	 	 	 	
Foreign exchange cash flow hedges	 	$	2.0	 	$	(2.8)	 	$	(0.5)	 	Cost of sales	
Interest rate swaps	 	 	0.3	 	 	 —	 	 	 —	 	Interest expense, net	
Total before tax	 	 	2.3	 	 	(2.8)	 	 	(0.5)	 	 	
Tax effect	 	 	 —	 	 	 —	 	 	 —	 	Provision for income taxes	
Total, net of tax	 	$	2.3	 	$	(2.8)	 	$	(0.5)	 	 	
 	 	 	 	 	 	 	 	 	 	 	 	
Amortization of pension and other postretirement benefit plan items	 	 	 	 	 	 	 	 	 	 	 	
Curtailment and settlement gain	 	$	(21.9)	 	$	 —	 	$	 —	 	(a)	
Prior service credit	 	 	(1.9)	 	 	(1.8)	 	 	(1.5)	 	(b)	
Net actuarial loss	 	 	6.4	 	 	5.2	 	 	6.4	 	(b)	
Acquisitions/divestitures	 	 	 —	 	 	1.0	 	 	 —	 	(c)	
Total before tax	 	 	(17.4)	 	 	4.4	 	 	4.9	 	 	
Tax effect	 	 	4.1	 	 	(1.1)	 	 	(1.5)	 	Provision for income taxes	
Total, net of tax	 	$	(13.3)	 	$	3.3	 	$	3.4	 	 	

	(a)		This amount primarily relates to the curtailment of certain of the Company’s pension plans in Europe. Refer to Note 15 for further information.	
	(b)		These AOCI components are included in the computation of net periodic benefit costs. Refer to Note 15 for further information.	
	(c)		This amount relates to the Company's divestiture of its Brazilian business during 2016. As of December 31, 2016, the Company had no residual AOCI balances recorded related to the Brazilian pension and postretirement medical plans.	
...
NOTE 21—EARNINGS PER SHARE
Basic earnings (loss) per ordinary share (“basic EPS”) is computed by dividing net income (loss) available to ordinary shareholders by the weighted average number of the Company’s ordinary shares outstanding for the applicable period. Diluted earnings (loss) per ordinary share (“diluted EPS”) is calculated using net income (loss) available to ordinary shareholders divided by diluted weighted-average ordinary shares outstanding during each period, which includes unvested RSUs, option awards, and PSUs. Diluted EPS considers the impact of potentially dilutive securities except in periods in which there is a loss because the inclusion of the potential ordinary shares would have an anti-dilutive effect.

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The following table presents basic EPS and diluted EPS for the years ended December 31, 2017, 2016, and 2015, respectively.

 	 	Year Ended	 	
 	 	December 31,	 	
(in millions, except per share data)	    	2017	    	2016	 	2015	 	
Earnings:	 	 	 	 	 	 	 	 	 	 	
Net income	 	$	328.3	 	$	318.3	 	$	133.6	 	
Shares:	 	 	 	 	 	 	 	 	 	 	
Weighted-average ordinary shares outstanding	 	 	43.8	 	 	46.5	 	 	48.8	 	
Dilutive effect of RSUs, option awards, and PSUs*	 	 	1.2	 	 	1.0	 	 	0.2	 	
Diluted weighted-average ordinary shares outstanding	 	 	45.0	 	 	47.5	 	 	49.0	 	
Income per share:	 	 	 	 	 	 	 	 	 	 	
Income per share—basic	 	$	7.49	 	$	6.84	 	$	2.74	 	
Income per share—diluted	 	$	7.30	 	$	6.70	 	$	2.73	 	

* Refer to Note 16 for discussion of RSUs, option awards, and PSUs granted to certain Company directors and employees.  The number of anti-dilutive shares that have been excluded in the computation of diluted earnings per share were 0.2 million, zero, and zero for the years ended December 31, 2017, 2016, and 2015, respectively. .
NOTE 22—SELECTED QUARTERLY FINANCIAL DATA (Unaudited)

 	    	First	    	Second	    	Third	    	Fourth	 	
(in millions, except per share data)	 	Quarter	 	Quarter	 	Quarter	 	Quarter	 	
2017	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net sales	 	$	1,104.5	 	$	1,145.2	 	$	1,096.6	 	$	1,101.8	 	
Gross profit	 	 	197.8	 	 	125.2	 	 	147.1	 	 	183.9	 	
Equity in earnings of unconsolidated affiliates	 	 	19.3	 	 	29.9	 	 	43.8	 	 	30.7	 	
Operating income	 	 	156.7	 	 	99.8	 	 	125.2	 	 	157.0	(3)	
Income before income taxes	 	 	146.6	(1)	 	79.0	 	 	41.5	(2)	 	144.0	(3)	
Net income	 	 	117.3	(1)	 	60.2	 	 	33.2	(2)	 	117.6	(3)(4)	
Net income per share- basic	 	$	2.66	(1)	$	1.37	 	$	0.76	(2)	$	2.69	(3)(4)	
Net income per share- diluted	 	$	2.59	(1)	$	1.34	 	$	0.74	(2)	$	2.63	(3)(4)	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	
2016	 	 	 	 	 	 	 	 	 	 	 	 	 	
Net sales	 	$	894.1	 	$	969.7	 	$	935.4	 	$	917.4	 	
Gross profit	 	 	139.7	 	 	169.7	 	 	140.4	 	 	137.8	 	
Equity in earnings of unconsolidated affiliates	 	 	35.0	 	 	38.6	 	 	36.7	 	 	34.4	 	
Operating income	 	 	120.2	 	 	156.1	 	 	103.2	(6)	 	111.3	(6)	
Income before income taxes	 	 	98.6	 	 	124.4	(5)	 	83.3	(5)(6)	 	99.0	(5)(6)(7)	
Net income	 	 	76.7	 	 	95.8	(5)	 	67.3	(5)(6)	 	78.5	(5)(6)(7)	
Net income per share- basic	 	$	1.58	 	$	2.04	(5)	$	1.47	(5)(6)	$	1.76	(5)(6)(7)	
Net income per share- diluted	 	$	1.56	 	$	2.00	(5)	$	1.43	(5)(6)	$	1.72	(5)(6)(7)	

	(1)		Includes a gain on sale of $9.3 million related to the sale of Sumika Styron Polycarbonate during the first quarter of 2017. Refer to Note 4 for further information.	
	(2)		Includes a $65.3 million loss on extinguishment of debt related to the third quarter of 2017 debt refinancing. Refer to Note 10 for further information.	
	(3)		Includes a $21.6 million gain related to the curtailment of certain of the Company’s pension plans in Europe. Refer to Note 15 for further information.	
	(4)		Includes an $8.5 million benefit related to the recording of a previously unrecognized tax benefit, including interest and penalties, during the fourth quarter of 2017. Refer to Note 13 for further information.	

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	(5)		Includes charges for the loss on sale of Trinseo Brazil of $12.9 million, $0.3 million, and $1.8 million during the second, third, and fourth quarters of 2016, respectively. Refer to Note 3 for further information.	
	(6)		Includes restructuring charges related to the Company’s decision to cease manufacturing activities at its latex binders manufacturing facility in Livorno, Italy of $16.0 million and $3.9 million during the third and fourth quarters of 2016, respectively. Refer to Note 19 for further information.	
	(7)		Includes other income of $6.9 million from the effective settlement of certain value-added tax positions during the fourth quarter of 2016	
...

 

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TRINSEO S.A.
SCHEDULE II—FINANCIAL STATEMENT SCHEDULE   
VALUATION AND QUALIFYING ACCOUNTS
(In Millions)

 	    	Balance at	    	Charged to	    	Deduction	    	Currency	    	Balance at	 	
 	 	Beginning of	 	Cost and	 	from	 	Translation	 	End of	 	
 	 	the Period	 	Expense	 	Reserves	 	Adjustments	 	the Period	 	
Allowance for doubtful accounts:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Year ended December 31, 2017	 	$	3.1	 	$	1.5	 	$	(0.1)	(a)  	$	1.1	 	$	5.6	 	
Year ended December 31, 2016	 	 	2.4	 	 	1.0	 	 	(0.1)	(a)  	 	(0.2)	 	 	3.1	 	
Year ended December 31, 2015	 	 	6.3	 	 	0.3	 	 	(3.3)	(a)  	 	(0.9)	 	 	2.4	 	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Tax valuation allowances:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Year ended December 31, 2017	 	$	112.6	 	$	35.6	 	$	 —	 	$	1.4	 	$	149.6	 	
Year ended December 31, 2016	 	 	85.1	 	 	27.7	 	 	 —	 	 	(0.2)	 	 	112.6	 	
Year ended December 31, 2015	 	 	66.9	 	 	22.1	 	 	 —	 	 	(3.9)	 	 	85.1	 	

	(a)		Amounts written off, net of recoveries.	

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM 
To the Board of Directors of and Members of
Americas Styrenics LLC
The Woodlands, Texas
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of Americas Styrenics LLC and its subsidiaries (the "Company") as of December 31, 2017 and 2016, the related consolidated statements of comprehensive income, members' equity, and cash flows for each of the three years in the period ended December 31, 2017, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2017 and 2016, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2017, in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinion
These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
 
We conducted our audits in accordance with the standards of the PCAOB and in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
 
Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
/s/ DELOITTE & TOUCHE LLP
Houston, Texas
February 14, 2018
We have served as the Company’s auditor since 2008.

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  AMERICAS STYRENICS LLC
CONSOLIDATED BALANCE SHEETS   
AS OF DECEMBER 31, 2017 AND 2016
(In millions of dollars)

 	 	 	 	 	 	 	 	
 	    	2017	    	2016	 	
ASSETS	 	 	 	 	 	 	 	
CURRENT ASSETS:	 	 	 	 	 	 	 	
Cash and cash equivalents	 	$	66.2	 	$	62.9	 	
Trade receivables (net of allowance of $3.1 in 2017 and $2.6 in 2016)	 	 	146.4	 	 	120.0	 	
Related company receivables	 	 	6.3	 	 	11.3	 	
Inventories	 	 	134.1	 	 	146.8	 	
Other current assets	 	 	11.0	 	 	13.8	 	
Total current assets	 	 	364.0	 	 	354.8	 	
NET PROPERTY, PLANT AND EQUIPMENT	 	 	224.1	 	 	233.5	 	
OTHER ASSETS:	 	 	 	 	 	 	 	
Deferred income taxes	 	 	0.8	 	 	1.8	 	
Other assets	 	 	11.3	 	 	13.2	 	
Total other assets	 	 	12.1	 	 	15.0	 	
TOTAL	 	$	600.2	 	$	603.3	 	
LIABILITIES AND MEMBERS’ EQUITY	 	 	 	 	 	 	 	
CURRENT LIABILITIES:	 	 	 	 	 	 	 	
Trade payables	 	$	111.6	 	$	69.1	 	
Related company payables	 	 	36.3	 	 	36.6	 	
Other payables	 	 	17.3	 	 	14.8	 	
Income taxes payable	 	 	6.3	 	 	5.3	 	
Accrued liabilities	 	 	12.8	 	 	17.4	 	
Total current liabilities	 	 	184.3	 	 	143.2	 	
POSTRETIREMENT BENEFIT LIABILITY	 	 	16.3	 	 	16.9	 	
OTHER LONG-TERM LIABILITIES	 	 	1.6	 	 	1.3	 	
Total liabilities	 	 	202.2	 	 	161.4	 	
COMMITMENTS AND CONTINGENCIES (Note 7)	 	 	 	 	 	 	 	
MEMBERS’ EQUITY:	 	 	 	 	 	 	 	
Members' equity	 	 	400.6	 	 	446.2	 	
Accumulated other comprehensive loss	 	 	(2.6)	 	 	(4.3)	 	
Total members’ equity	 	 	398.0	 	 	441.9	 	
TOTAL	 	$	600.2	 	$	603.3	 	
 
See notes to consolidated financial statements.

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  AMERICAS STYRENICS LLC
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME   
FOR THE YEARS ENDED DECEMBER 31, 2017, 2016, AND 2015
(In millions of dollars)

 	 	 	 	 	 	 	 	 	 	 	
 	    	2017	    	2016	    	2015	 	
Net sales	 	$	1,783.6	 	$	1,483.1	 	$	1,600.1	 	
Cost of sales	 	 	1,543.5	 	 	1,205.0	 	 	1,309.5	 	
Gross margin	 	 	240.1	 	 	278.1	 	 	290.6	 	
Technical service and development	 	 	2.4	 	 	2.4	 	 	2.5	 	
Selling and marketing	 	 	7.5	 	 	8.9	 	 	8.7	 	
Administrative	 	 	28.2	 	 	31.0	 	 	29.0	 	
Foreign exchange loss	 	 	0.4	 	 	0.6	 	 	4.7	 	
Other expense—net	 	 	0.6	 	 	0.3	 	 	2.0	 	
Operating income	 	 	201.0	 	 	234.9	 	 	243.7	 	
Interest income	 	 	0.2	 	 	0.2	 	 	0.1	 	
Income tax expense	 	 	(6.8)	 	 	(6.3)	 	 	(6.3)	 	
Net income	 	 	194.4	 	 	228.8	 	 	237.5	 	
Other comprehensive loss:	 	 	 	 	 	 	 	 	 	 	
Net actuarial gain (loss)	 	 	1.0	 	 	0.7	 	 	(0.5)	 	
Reclassification of actuarial loss to income	 	 	 —	 	 	0.1	 	 	—	 	
Reclassification of prior-service cost to income	 	 	0.7	 	 	0.7	 	 	0.7	 	
Net other comprehensive income (loss)—defined benefit plans	 	 	1.7	 	 	1.5	 	 	0.2	 	
Total comprehensive income	 	$	196.1	 	$	230.3	 	$	237.7	 	
 
See notes to consolidated financial statements.

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  AMERICAS STYRENICS LLC
CONSOLIDATED STATEMENTS OF MEMBERS’ EQUITY 
FOR THE YEARS ENDED DECEMBER 31, 2017, 2016, AND 2015
(In millions of dollars)

 	 	 	 	 	 	 	 	 	 	 	
 	    	 	    	Accumulated	    	 	 	 	
 	 	 	 	Other	 	 	 	 	
 	 	Members'	 	Comprehensive	 	 	 	 	
 	 	Equity	 	Loss	 	Total	 	
BALANCE—January 1, 2015	 	$	489.9	 	$	(6.0)	 	$	483.9	 	
Distribution to Members	 	 	(250.0)	 	 	 —	 	 	(250.0)	 	
Defined benefit plans—other comprehensive income	 	 	 —	 	 	0.2	 	 	0.2	 	
Net income	 	 	237.5	 	 	 —	 	 	237.5	 	
BALANCE—December 31, 2015	 	 	477.4	 	 	(5.8)	 	 	471.6	 	
Distribution to Members	 	 	(260.0)	 	 	 —	 	 	(260.0)	 	
Defined benefit plans—other comprehensive income	 	 	 —	 	 	1.5	 	 	1.5	 	
Net income	 	 	228.8	 	 	 —	 	 	228.8	 	
BALANCE—December 31, 2016	 	 	446.2	 	 	(4.3)	 	 	441.9	 	
Distribution to Members	 	 	(240.0)	 	 	 —	 	 	(240.0)	 	
Defined benefit plans—other comprehensive income	 	 	 —	 	 	1.7	 	 	1.7	 	
Net income	 	 	194.4	 	 	 —	 	 	194.4	 	
BALANCE—December 31, 2017	 	$	400.6	 	$	(2.6)	 	$	398.0	 	
 
See notes to consolidated financial statements.

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  AMERICAS STYRENICS LLC
CONSOLIDATED STATEMENTS OF CASH FLOWS   
FOR THE YEARS ENDED DECEMBER 31, 2017, 2016, AND 2015
(In millions of dollars)

 	 	 	 	 	 	 	 	 	 	 	
 	    	2017	    	2016	    	2015	 	
OPERATING ACTIVITIES:	 	 	 	 	 	 	 	 	 	 	
Net income	 	$	194.4	 	$	228.8	 	$	237.5	 	
Adjustments to reconcile net income to net cash provided by operating activities:	 	 	 	 	 	 	 	 	 	 	
Depreciation and amortization	 	 	42.4	 	 	41.0	 	 	39.0	 	
Net gain on disposal of assets	 	 	0.1	 	 	 —	 	 	0.4	 	
Deferred income taxes	 	 	1.0	 	 	1.0	 	 	(0.4)	 	
Allowance for doubtful accounts	 	 	0.4	 	 	(1.2)	 	 	(0.7)	 	
Changes in assets and liabilities that provided (used) cash:	 	 	 	 	 	 	 	 	 	 	
Trade receivables	 	 	(26.8)	 	 	9.3	 	 	33.4	 	
Related company receivables	 	 	5.0	 	 	(3.1)	 	 	7.1	 	
Inventories	 	 	12.6	 	 	(12.3)	 	 	(20.5)	 	
Trade payables	 	 	42.5	 	 	(8.1)	 	 	(21.4)	 	
Related company payables	 	 	(0.2)	 	 	4.9	 	 	(9.5)	 	
Other assets and liabilities	 	 	0.9	 	 	5.1	 	 	10.3	 	
Net cash provided by operating activities	 	 	272.3	 	 	265.4	 	 	275.2	 	
INVESTING ACTIVITIES:	 	 	 	 	 	 	 	 	 	 	
Capital expenditures	 	 	(29.2)	 	 	(22.5)	 	 	(36.5)	 	
Proceeds from settlement treated as reimbursement of capital expenditures (Note 7)	 	 	 —	 	 	 —	 	 	7.8	 	
Disposal of assets	 	 	0.2	 	 	0.1	 	 	 —	 	
Net cash used in investing activities	 	 	(29.0)	 	 	(22.4)	 	 	(28.7)	 	
FINANCING ACTIVITY—Distribution to Members	 	 	(240.0)	 	 	(260.0)	 	 	(250.0)	 	
Cash used in financing activity	 	 	(240.0)	 	 	(260.0)	 	 	(250.0)	 	
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	 	 	3.3	 	 	(17.0)	 	 	(3.5)	 	
CASH AND CASH EQUIVALENTS—Beginning of year	 	 	62.9	 	 	79.9	 	 	83.4	 	
CASH AND CASH EQUIVALENTS—End of year	 	$	66.2	 	$	62.9	 	$	79.9	 	
SUPPLEMENTAL CASH FLOW INFORMATION:	 	 	 	 	 	 	 	 	 	 	
Noncash investing activity—capital expenditures payable	 	$	4.3	 	$	2.1	 	$	2.9	 	
Cash paid for income taxes	 	$	4.5	 	$	4.7	 	$	3.3	 	
 
See notes to consolidated financial statements.

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  AMERICAS STYRENICS LLC
NOTES TO CONSOLIDATED FINANCIAL  STATEMENTS
AS OF DECEMBER 31, 2017 AND 2016, AND
FOR THE YEARS ENDED DECEMBER 31, 2017, 2016, AND 2015
(Amounts in millions of dollars)
 
1. FORMATION OF VENTURE
Effective May 1, 2008, Chevron Phillips Chemical Company LP (“CPChem”) and The Dow Chemical Company (“Dow”) joined forces in styrenics by creating Americas Styrenics LLC (the “Company”). Effective June 17, 2010, Dow sold its ownership in the Company to Trinseo LLC (formerly, Styron LLC). CPChem and Trinseo LLC are referred to herein as the “Members.” The Members share equally in the profits and losses of the Company.
2. NATURE OF OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES
Principles of Consolidation— The consolidated financial statements include the accounts of the Company and its subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The Company’s subsidiaries and partnership interests are as follows: Americas Styrenics Colombia Ltda, Americas Styrenics de Mexico, de R.L. de C.V., Americas Styrenics Canada Inc., and Americas Styrenics Industria e Comercico de Poliestireno Ltda (Brazil).
Nature of Operations —The Company was formed as a joint venture and focuses on styrenics (styrene and polystyrene) production, sales, and distribution in North America and South America.
Cash and Cash Equivalents —Included in cash and cash equivalents, from time to time, are short-term interest-bearing investments on deposit with financial institutions. There was $17.6 of interest-bearing investments at December 31, 2017 and 2016.
Trade Receivables —The Company’s United States’ customers are primarily in the packaging industry, but also consist of other chemical and plastics manufacturers. The Company’s foreign customers reside primarily in Argentina, Brazil, Chile, Colombia, and Mexico. The Company evaluates the creditworthiness of customers and in certain circumstances, may require letters of credit to support product sales. The Company maintains an allowance for doubtful accounts based on anticipated collection of its accounts receivable.
Inventories —Inventories at December 31, 2017 and 2016, were as follows:

 	    	2017	    	2016	 	
Finished goods	 	$	55.4	 	$	55.1	 	
Work in process	 	 	35.8	 	 	67.6	 	
Raw materials	 	 	30.7	 	 	13.5	 	
Supplies	 	 	12.2	 	 	10.6	 	
Total inventories	 	$	134.1	 	$	146.8	 	

Inventories are stated at the lower of cost or market. Finished products and work-in-process inventories include material, labor, and manufacturing overhead costs. US inventories are accounted for on a last-in, first-out (LIFO) basis. The reserves reducing inventories from a first-in, first-out (FIFO) basis to a LIFO basis amounted to $67.2 at December 31, 2017, and $31.4 at December 31, 2016. In 2017, the liquidation of certain of the Company’s LIFO inventory layers increased operating income by $6.3. Foreign inventories are accounted for on a FIFO basis.  

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Property, Plant, and Equipment —Upon formation of the Company, property, plant, and equipment were recorded at CPChem’s and Dow’s net book value. Current additions of property, plant, and equipment are recorded at cost. The Company provides for depreciation using the straight-line method at rates based on the estimated service lives of the various classes of assets (3–45 years). Expenditures for repairs and maintenance, including major maintenance commonly known as turnarounds, are expensed as incurred. Components of property, plant, and equipment at December 31, 2017 and 2016, are as follows:

 	    	2017	    	2016	 	
Land and waterway improvements	 	$	12.7	 	$	11.2	 	
Buildings	 	 	32.2	 	 	28.4	 	
Transportation and construction equipment	 	 	64.6	 	 	67.0	 	
Machinery and other equipment	 	 	880.4	 	 	862.8	 	
Utilities and supply lines/other property	 	 	14.4	 	 	10.9	 	
Construction in progress	 	 	19.5	 	 	17.6	 	
Total property, plant, and equipment	 	 	1,023.8	 	 	997.9	 	
Less accumulated depreciation	 	 	(799.7)	 	 	(764.4)	 	
Net property, plant, and equipment	 	$	224.1	 	$	233.5	 	

Income Taxes —The Company is treated as a flow-through partnership for U.S. federal income tax purposes and for most state income tax purposes. As such, the Company itself is not liable for U.S. federal income taxes. The Company files a U.S. partnership return which reflects each Member’s share of income or loss. The Members are responsible for reporting and paying any tax on their respective income tax returns. The Company is directly liable for certain state income and franchise taxes, foreign withholding, and foreign direct or indirect taxes.
The Company has foreign subsidiaries in Canada, Colombia, and Mexico. All foreign entities except the Canadian subsidiary have elected to be treated as disregarded foreign branches of the Company for U.S. purposes. As such, the income or loss of the respective disregarded entities will be included in the U.S. federal partnership return. The foreign subsidiaries are responsible for all applicable taxes on foreign operations, and these taxes have been provided for in the consolidated financial statements.
Accounting standards establish a "more-likely-than-not" recognition threshold that must be met before a tax benefit can be recognized in the financial statements. If a tax deduction is taken on a tax return, but does not meet the more-likely-than-not recognition threshold, an increase in income tax liability, above what is payable on the tax return, is required to be recorded. An uncertain tax position may also result in an asset which means that, after settlement, taxable income could be less than what was reported on the original tax return. The Company has not recorded any liabilities for uncertain tax positions.
Impairment of Long-Lived Assets —The Company evaluates the carrying value of long-lived assets to be held and used, including intangible assets, when events or circumstances warrant such a review. The carrying value of a long-lived asset to be held and used is considered impaired when the anticipated, separately identifiable undiscounted cash flows from such an asset are less than the carrying value of the asset. In that event, a loss is recognized based on the amount by which the carrying value exceeds the fair value of the long‑lived asset. Fair value is determined primarily using the anticipated cash flows discounted at a rate commensurate with the risk involved. No impairment was recorded in 2017, 2016, or 2015.
Asset Retirement Obligation —The Company assesses whether it has legal obligations associated with the retirement of tangible long-lived assets that result from the acquisition, construction, or development and/or the normal operation of a long-lived asset, including any legal obligations that require disposal of a replaced part that is a component of a tangible long-lived asset. At December 31, 2017 and 2016, the Company had no significant asset retirement obligations.
Insurance  —The Company maintains insurance for automobile risks, general liability, including products, directors, officers, workers’ compensation, and property. This insurance is placed with highly rated insurance carriers. The limits and deductibles are consistent for a company of this size and structure.

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  Foreign Currency —The functional currency for the Company’s foreign operations is the U.S. dollar, resulting in no currency translation adjustments. Foreign currency gains and losses are reflected in operations.
Use of Estimates —The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Fair Value of Financial Instruments —The carrying amounts reported in the balance sheets of cash and cash equivalents, accounts receivable and accounts payable approximate fair value because of the immediate or short-term maturity of these financial instruments.
Revenue Recognition —The Company recognizes revenue when there is evidence of a sales agreement, the delivery of goods has occurred, the sales price is fixed or determinable, and the collectability of revenue is reasonably assured. Revenue includes the selling price of the product and all related delivery charges paid by the customer. Freight costs and any directly related associated costs of transporting finished product to customers are recorded as “cost of sales.” Revenue is reduced at the time of sale for estimated customer‑related incentives (mostly volume-related incentives).
Subsequent Events —The Company has evaluated subsequent events through February 14, 2018, the date the financial statements were available to be issued.
3. RECENT ACCOUNTING GUIDANCE
Accounting Pronouncements Adopted During 2017
In July 2015, the Financial Accounting Standards Board (FASB) issued ASU No. 2015-11, Simplifying the Measurement of Inventory. This ASU requires entities to measure most inventory at the lower of cost and net realizable value, thereby simplifying the current guidance under which an entity must measure inventory at the lower of cost or market. ASU No. 2015-11 is effective for fiscal years beginning after December 15, 2016, and should be applied prospectively. We adopted the amendments in this ASU effective January 1, 2017, and the initial adoption of the amendment in this ASU did not have a significant impact on our consolidated financial statements.
Accounting Pronouncements Pending Adoption in Future Periods
In 2016, the FASB issued ASUs which amended ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606). ASU 2014-09, as amended, provides a comprehensive new revenue recognition model that requires revenue to be recognized in a manner that depicts the transfer of goods or services to a customer at an amount that reflects the consideration expected to be received in exchange for those goods or services. ASU 2014-09, as amended, is effective for fiscal years beginning after December 15, 2018 and permits early adoption by nonpublic entities. The ASU, as amended, permits retrospective application using either of the following methodologies: (i) restatement of each prior reporting period presented or (ii) recognition of a cumulative-effect adjustment as of the date of initial application. The Company is currently evaluating the impact of adopting the ASU, including the transition method to be applied.
In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842). This ASU will increase transparency and comparability among entities by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. This ASU will require lessees to recognize in the statement of financial position a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying asset for the lease term. ASU No. 2016-02 is effective for fiscal years beginning after December 15, 2019. Early adoption is permitted. Reporting entities are required to recognize and measure leases under these amendments at the beginning of the earliest period presented using a modified retrospective approach. The Company is currently evaluating the impact of adopting ASU No. 2016‑02.

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In March 2017, the FASB issued ASU No. 2017-07, Compensation—Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. The amendments in this ASU require that an employer report the service cost component of net periodic pension cost and net periodic postretirement benefit cost in the same line items as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net benefit cost are required to be presented in the income statement separately from the service cost component and outside of income from operations. The amendments in this ASU also allow only the service cost component to be eligible for capitalization when applicable (for example, as a cost of internally manufactured inventory or a self-constructed asset). The amendments in this ASU are effective for fiscal years beginning after December 15, 2017. The amendments in this ASU should be applied retrospectively for the presentation of the service cost component and the other components of net periodic pension cost and net periodic postretirement benefit cost in the income statement and prospectively, on and after the effective date, for the capitalization of the service cost component of net periodic pension cost and net periodic postretirement benefit cost in assets. We do not expect the adoption of this ASU to have a significant impact on our consolidated financial statements.
4. REVOLVING CREDIT FACILITY
The Company’s unsecured $50.0 revolving credit facility with Comerica Bank terminates in August 2020. Interest on amounts drawn under the facility equal, at the Company’s option, a margin over either the prime rate or the London InterBank Offered Rate-based rate (plus 125 basis points as of December 31, 2017) as defined in the credit agreement. There were no outstanding borrowings at December 31, 2017 or 2016.
5. INCOME TAXES
The components of income before taxes for the years ended December 31, 2017, 2016, and 2015, are as follows:

 	    	2017	    	2016	    	2015	 	
Domestic	 	$	188.2	 	$	215.0	 	$	240.3	 	
Foreign	 	 	13.0	 	 	20.1	 	 	3.5	 	
Total income before taxes	 	$	201.2	 	$	235.1	 	$	243.8	 	
 
The components of income tax expense for the years ended December 31, 2017, 2016, and 2015, are as follows:

 	    	2017	    	2016	    	2015	 	
State—current	 	$	0.2	 	$	0.2	 	$	0.2	 	
Foreign—current	 	 	5.6	 	 	5.1	 	 	6.5	 	
Foreign—deferred	 	 	1.0	 	 	1.0	 	 	(0.4)	 	
Total income tax expense	 	$	6.8	 	$	6.3	 	$	6.3	 	
 
The components of deferred income tax assets and liabilities at December 31, 2017 and 2016, are as follows:

 	    	2017	    	2016	 	
Inventory	 	$	0.7	 	$	1.2	 	
Fixed assets	 	 	 —	 	 	1.1	 	
Other temporary differences	 	 	0.1	 	 	(0.5)	 	
Deferred tax assets	 	$	0.8	 	$	1.8	 	

Undistributed earnings of foreign subsidiaries are not deemed to be permanently reinvested. Currently, undistributed earnings exist in the Canadian, Colombian, and Mexican subsidiaries. Future repatriation of earnings will not be subject to tax by the Company (but rather its Members); however, foreign withholding taxes may apply.

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6. EMPLOYEE BENEFIT PLANS
The Company provides reimbursement of medical and dental costs to retired employees. The Company’s plan, the Retiree Reimbursement Account (RRA), is an unfunded plan and is calculated at the time of the employee’s retirement based on years of credited service. The Company has the ability to change the benefits at any time. All employees are eligible, except for former Dow employees who choose to participate in The Dow Chemical Company Retiree Medical Care Program upon retirement. The Company uses a December 31 measurement date for the RRA.
At each of December 31, 2017 and 2016, the RRA had benefit obligations in the amount of $17.2 and $17.7, respectively. The Company contributed and paid benefits in the amount of $0.7 in 2017, $0.5 in 2016, and $0.4 in 2015.
At December 31, 2017 and 2016, amounts recognized in the consolidated balance sheets consist of:

 	    	2017	    	2016	 	
Current liabilities	 	$	(0.9)	 	$	(0.8)	 	
Noncurrent liabilities	 	 	(16.3)	 	 	(16.9)	 	
Total	 	$	(17.2)	 	$	(17.7)	 	

At December 31, 2017 and 2016, amounts recognized in accumulated other comprehensive loss were as follows:

 	    	2017	    	2016	 	
Net actuarial loss	 	$	0.6	 	$	1.6	 	
Prior service cost	 	 	2.0	 	 	2.7	 	
Total	 	$	2.6	 	$	4.3	 	

 
In 2018, $0.7 of estimated prior service cost will be amortized from accumulated other comprehensive loss into net periodic benefit cost.
Net periodic benefit cost and components of other amounts recognized in other comprehensive (income) loss were as follows:

 	    	2017	    	2016	    	2015	 	
Net periodic postretirement benefit cost	 	$	1.8	 	$	2.0	 	$	1.8	 	
Other changes in benefit obligations recognized in other comprehensive loss (income):	 	 	 	 	 	 	 	 	 	 	
Net actuarial (gain) loss	 	 	(1.0)	 	 	(0.7)	 	 	0.5	 	
Recognized actuarial loss	 	 	 —	 	 	(0.1)	 	 	 —	 	
Recognized prior-service cost	 	 	(0.7)	 	 	(0.7)	 	 	(0.7)	 	
Total recognized in other comprehensive (income) loss	 	 	(1.7)	 	 	(1.5)	 	 	(0.2)	 	
Total recognized in net periodic benefit cost and other comprehensive loss (income)	 	$	0.1	 	$	0.5	 	$	1.6	 	

Actuarial assumptions used to determine benefit obligations and net periodic benefit cost were as follows:

 	    	2017	    	2016	    	2015	 	
Discount rate used to determine net periodic benefit cost	 	3.82	%  	3.76	%  	3.65	%  	
Discount rate used to determine benefit obligation at December 31	 	3.49	%  	3.82	%  	N/A	 	

 	 	 	 	 	 	 	 	
 	    	2017	    	2016	    	2015	 	
Health Care Cost Assumptions	 	 	 	 	 	 	 	
Initial health care cost trend rate	 	7.65	%  	8.00	%  	8.00	%	
Ultimate health care cost trend rate	 	4.50	%  	4.50	%  	4.50	%	
Year ultimate reached	 	2027	 	2027	 	2023	 	

Estimated health care cost trend rates can have a significant effect on the amounts reported for the RRA.

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The Company expects to contribute approximately $0.9 to its RRA plan in 2018.
At December 31, 2017, the estimated future benefit payments, reflecting expected future service, as appropriate, are expected to be paid as follows:

2018	    	$	0.9	
2019	 	 	1.1	
2020	 	 	1.3	
2021	 	 	1.5	
2022	 	 	1.7	
2023 through 2027	 	 	9.5	
Total	 	$	16.0	

The Company also has a defined contribution employee savings plan and made discretionary contributions of $3.7 in 2017 and $3.5 in 2016 and 2015.
 
7. COMMITMENTS AND CONTINGENCIES
Commitments
The Company and its subsidiaries maintain outside service agreements and lease buildings, ground and easements, rail cars, and other vehicles under noncancelable operating leases, which expire on varying dates between 2018 and 2028.
Total future minimum annual rentals in effect at December 31, 2017, for noncancelable operating leases are as follows:

Years Ending December 31	    	 	    	
2018	 	$	12.6	
2019	 	 	7.0	
2020	 	 	4.8	
2021	 	 	3.7	
2022	 	 	2.7	
2023 and thereafter	 	 	9.5	
Total	 	$	40.3	
Expense for total rental and long-term commitments was $12.2, $9.3, and $7.6 for the years ended December 31, 2017, 2016, and 2015, respectively.
The Company has entered into long-term sales commitments and purchase agreements with several of its key suppliers, including its Members (see Note 8). The commitment contracts are for one- to three-year periods. Because the pricing and supply fluctuates with the commodity market, a definitive dollar value cannot be determined.
In addition, the Company has purchase commitments of $44.6 mainly related to certain feedstock, utility, and third party service costs. The Company does not consider purchase orders to be firm commitments. If the Company chooses to cancel a purchase order, it may be obligated to reimburse the vendor for unrecoverable outlays incurred prior to cancellation under certain circumstances.
Contingencies
The Company is a party to various legal proceedings and claims incidental to the normal conduct of its business. Management believes that the ultimate disposition of these matters will not have a material adverse effect on the Company’s consolidated financial position or results of operations.

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Pursuant to the contribution agreement, all preexisting environmental matters have been outlined for each site and any contingencies are the responsibility of Dow and CPChem. All subsequent obligations are the liability of the Company. No environmental reserve was recorded as of December 31, 2017, 2016, or 2015. During 2015, the Company received reimbursement from Dow of certain capital costs at one of its polystyrene facilities, totaling $7.8, which was recorded as a reduction of the carrying cost of the assets.
8. RELATED-PARTY TRANSACTIONS
The Company entered into various supply and purchase agreements with the Members and their affiliated companies. These agreements include sales and purchases of energy, raw materials, and services. A summary of transactions for the years ended December 31, 2017, 2016, and 2015, is as follows:

 	    	2017	    	2016	    	2015	 	
Net sales	 	$	82.9	 	$	134.4	 	$	161.4	 	
Purchases	 	 	386.1	 	 	384.0	 	 	483.3	 	
 
Balances receivable and payable to the Members are included in the consolidated financial statements as related company receivables and payables.
******

F-69

Exhibit 10.10

 
 	 
1000 Chesterbrook
Blvd, Suite 300
Berwyn, PA 19312	
 
Strictly Private & Confidential
December 21, 2017
Marilyn Horner
Re: Trinseo Retention Bonus
Dear Marilyn:
It is with great pleasure that I write to inform you that Trinseo US Holdings, Inc. and Trinseo LLC (collectively, “Trinseo” or the “Company”) wish to recognize your consistent performance and commitment to the Company, and reward and incentivize your continued employment in the form of the Retention Bonus set forth below.
Retention Bonus
In consideration for your continued employment in your current role as Senior Vice President, Human Resources with the Company through June 30, 2018 (the “Commitment Date”), you will be eligible for an individual, extraordinary (one time) conditional retention bonus of $100,000.00 (the “Retention Bonus”). Your eligibility for the Retention Bonus is subject to the terms and conditions set out below.
Terms and Conditions of Retention Bonus
1.      Retention Bonus Calculation and Pay-Out Schedule
The Retention Bonus is calculated and shall be paid out as set forth below:
A payment equal to the full amount will be paid to you in July 2018, on the next regular Company payroll cycle following the Commitment Date. The Retention Bonus will be made subject to withholding for applicable taxes.
2.      Conditions For Receiving a Retention Bonus
Your right to receive and retain the Retention Bonus is conditional upon and subject to:
	·		You sign and return this Retention Bonus agreement;	
	·		You continue in the Company’s employ through the Commitment Date or you are terminated from employment by Trinseo, other than for Cause, prior to the Commitment Date;	
	·		You have not terminated your employment with Trinseo prior to the Commitment Date; and	
	·		Your employment with Trinseo has not been terminated for Cause prior to the Commitment Date. “Cause” for purposes of this Retention Letter means dismissal by Trinseo for failing or refusing to perform any stated duty or instruction; violating any Trinseo policy; gross negligence in the performance of any of your principal duties or assignments; repeated	

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1000 Chesterbrook
Blvd, Suite 300
Berwyn, PA 19312	

unsatisfactory work performance; insubordinate conduct; disloyalty or dishonesty; violation of any agreement involving the Company; engaging in any conduct constituting a crime in connection with or in the course of your employment; conviction for any crime constituting a felony; unauthorized use of funds; being off work or unable to work with reasonable accommodation for more than sixty (60) days due to illness or injury; or any other conduct constituting cause within the meaning of common law.
3.      Confidentiality
The terms and conditions of the Retention Bonus are Confidential and in no circumstances should you disclose the contents of this Retention Letter to anyone, except your spouse, attorney, or accountant, unless written permission has been granted by the Company or except as may be permitted or required by applicable laws. The Company shall have the right to withhold and cancel the Retention Bonus or request the full return of any payment already made if the information is disclosed without authorization.
4.      Performance
You will continue to be employed as Senior Vice President, Human Resources, but you may have a change of title that is reflective of a change in scope and responsibilities. During your employment you will, to the best of your abilities, contribute your professional efforts, time and skill to the performance of your assigned duties.
5.      Compensation
The terms and conditions of your compensation will remain at a rate that is not less than the rate currently in effect. You will be paid (together with the respective part of the Retention Bonus where applicable and due) in accordance with Trinseo’s normal payroll schedule.
6.      Other Employment Terms
It is understood and agreed that this Retention Bonus does not supersede, amend, alter or replace any written agreement you signed dealing with your employment with the Company generally, or any restrictions on competition, assignment of or rights to inventions or other intellectual property, restrictions on solicitation or recruitment or employees or customers, restrictions on the use or disclosure of trade secrets or confidential information, or similar agreements or guaranty you employment for a specific term. You reaffirm your obligations under and agree to comply with the terms of all such agreements. If Trinseo or you sues to collect any amounts due and owing under this agreement, then the prevailing party shall be entitled to recover its reasonable attorneys and costs incurred in that lawsuit in addition to any other remedies.
This Retention Bonus does not in any way create a contract of employment or change your at-will employment relationship in any way, which means your employment relationship with Trinseo will continue to be terminable by you or the Company at any time, with or without cause or notice.

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1000 Chesterbrook
Blvd, Suite 300
Berwyn, PA 19312	

7.       Governing Law
 
This Retention Bonus agreement is accepted and entered into in Pennsylvania and shall be interpreted according to the laws of that State without regard to choice of law principles without reference to the conflicts of laws provisions thereof.
 
8.       Sole Discretion
 
No waiver, change in, or failure to enforce, any other similar agreement between the Company and any other employee shall grant you rights under this Retention Letter, nor entitle you to the same or similar treatment. The Company shall have the right to determine eligibility for a Retention Bonus under this Retention Letter in its sole discretion ,   and that decision shall be conclusive absent manifest error.
 
If you accept and agree to the terms and conditions of the Retention Letter, please sign below in the space provided and return a signed duplicate to Angelo Chaclas (SVP, CLO & Secretary) within seven (7) days of the date of this letter. If you have any further questions, please do not hesitate to contact me or Angelo.
 
I once again would like to thank you for your continued hard work and wish you every success for your future employment at Trinseo.

 	 	
Yours Sincerely,	 	
 	 	
/s/ Chris Pappas	 	
Chris Pappas	 	
President & CEO	 	

ACCEPTANCE
I confirm that I have read and that I understand the terms and conditions attached to the Retention Bonus (as defined above). I further confirm that I understand that acceptance of and agreement to said terms and conditions are part of being eligible for the Retention Bonus.

/s/ Marilyn Horn er	 	 	
 	 	 	
Signature	 	 	
 	 	 	
Printed Name: Marilyn Horn er	 	Date: 	Dec. 21, 2017	

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Exhibit 10.21
EXECUTION VERSION
DATED 21 DECEMBER 2017
TRINSEO EUROPE GMBH (formerly STYRON EUROPE GMBH)
(as a Swiss Seller, a Swiss Servicer and Chargor)
TRINSEO EXPORT GMBH
(as a Swiss Seller, a Swiss Servicer and Pledgor)
TRINSEO DEUTSCHLAND ANLAGENGESELLSCHAFT MBH (formerly STYRON DEUTSCHLAND
ANLAGENGESELLSCHAFT MBH)
(as German Seller and German Servicer)
TRINSEO NETHERLANDS B.V. (formerly STYRON NETHERLANDS B.V.)
(as Dutch Seller and Dutch Servicer)
TRINSEO LLC (formerly STYRON LLC)
(as U.S. Seller and U.S. Servicer)
TRINSEO U.S. RECEIVABLES COMPANY SPV LLC
(as U.S. Intermediate Transferor)
STYRON RECEIVABLES FUNDING DESIGNATED ACTIVITY COMPANY
(as Master Purchaser and Chargee)
TRINSEO FINANCE LUXEMBOURG S.À R.L., LUXEMBOURG, ZWEIGNIEDERLASSUNG HORGEN (formerly
STYRON FINANCE LUXEMBOURG S.À R.L., LUXEMBOURG, ZWEIGNIEDERLASSUNG HORGEN)
(as Investment Manager and Styron Noteholder)
REGENCY ASSETS DESIGNATED ACTIVITY COMPANY
(as Regency Noteholder)
HSBC BANK PLC
(as Cash Manager and Master Purchaser Account Bank)
TRINSEO HOLDING S.À R.L. (formerly STYRON HOLDING S.À R.L.)
(as Parent)
TMF ADMINISTRATION SERVICES LIMITED
(as Corporate Administrator and Registrar)
THE LAW DEBENTURE TRUST CORPORATION P.L.C.
(as Styron Security Trustee)

 	 	 	
 	DEED OF AMENDMENT AND RESTATEMENT	 	

 

CONTENTS

Clause	    	Page	
 	 	 	
1.       DEFINITIONS AND INTERPRETATION	 	
2	
2.       CONSENT TO THE STYRON SECURITY TRUSTEE	 	
3	
3.       AMENDMENTS	 	
4	
4.       AMENDMENTS TO BECOME EFFECTIVE	 	
4	
5.       REPRESENTATIONS AND WARRANTIES AND COVENANTS	 	
4	
6.       CONTINUITY AND FURTHER ASSURANCE	 	
5	
7.       COSTS, EXPENSES AND INDEMNIFICATION	 	
5	
8.       GOVERNING LAW AND JURISDICTION	 	
5	
9.       MISCELLANEOUS	 	
6	
SCHEDULE 1  CONDITIONS PRECEDENT LIST FOR TRINSEO AR SECURITISATION EIGHTH AMENDMENT	 	
7	
SCHEDULE 2  AMENDED AND RESTATED MASTER DEFINITIONS AND FRAMEWORK DEED	 	
10	

-  i  -

 

THIS DEED is dated 21 December 2017 and made between:
(1)        TRINSEO EUROPE GMBH (formerly STYRON EUROPE GMBH), a limited liability company incorporated in Switzerland, having its registered office at Zugerstrasse 231, CH-8810 Horgen, Switzerland, being an indirect wholly-owned subsidiary of the Parent (a “ Swiss Seller ”, a “ Swiss Servicer ” and “ Chargor ”);
(2)        TRINSEO EXPORT GMBH , a limited liability company incorporated in Switzerland, having its registered office at Zugerstrasse 231, CH-8810 Horgen,  Switzerland, being an indirect wholly-owned subsidiary of the Parent (a “ Swiss Seller ” and together with Trinseo Europe GmbH, the “ Swiss Sellers ”, a “ Swiss Servicer ” and together with Trinseo Europe GmbH, the “ Swiss Servicers ”, and “ Pledgor ”);
(3)        TRINSEO DEUTSCHLAND ANLAGENGESELLSCHAFT MBH (formerly STYRON DEUTSCHLAND ANLAGENGESELLSCHAFT MBH), incorporated in Germany as a limited liability company ( Gesellschaft mit beschränkter Haftung ), registered at the “local court ( Amtsgericht ) of Tostedt under HRB 202609 and having its business address at Kölner Straße 10, 65760 Eschborn, Germany (the “ German Seller ” and the “ German Servicer ”);
(4)        TRINSEO NETHERLANDS B.V. (formerly STYRON NETHERLANDS B.V.), a private company with limited liability ( besloten vennootschap met beperkte aansprakelijkheid ) incorporated in The Netherlands, having its corporate seat ( statutaire zetel ) in Terneuzen, The Netherlands and its registered office at Innovatieweg 14, 4542 NM Hoek (Terneuzen), The Netherlands (the “ Dutch Seller ” and the “ Dutch Servicer ”);
(5)        TRINSEO LLC (formerly STYRON LLC), a limited liability company formed under the laws of the State of Delaware, having its primary office at 1000 Chesterbrook Boulevard, Suite 300, Berwyn, Pennsylvania 19312, (the “ U.S. Seller ” and the “ U.S. Servicer ”);
(6)        TRINSEO U.S. RECEIVABLES COMPANY SPV LLC , a limited liability company organized under the laws of the State of Delaware, having its primary office at c/o Trinseo LLC at 1000 Chesterbrook Boulevard, Suite 300, Berwyn, Pennsylvania 19312, in its capacity as the U.S. Intermediate Transferor (the “ U.S. Intermediate Transferor ” and, together with the Swiss Sellers, the German Seller, the Dutch Seller and the U.S. Seller, the “ Sellers ”);
(7)        STYRON RECEIVABLES FUNDING DESIGNATED ACTIVITY COMPANY a company incorporated in Ireland with registration number 486138, whose registered office is at 3rd Floor, Kilmore House, Park Lane, Spencer Dock, Dublin 1, Ireland (the “ Master Purchaser ”, the “ Pledgee ”, and the “ Chargee ”);
(8)        TRINSEO FINANCE LUXEMBOURG S.À R.L., LUXEMBOURG, ZWEIGNIEDERLASSUNG HORGEN (formerly STYRON FINANCE LUXEMBOURG S.À R.L., LUXEMBOURG, ZWEIGNIEDERLASSUNG HORGEN), a Swiss branch, with offices located at Zugerstrasse 231, CH-8810, Horgen, Switzerland, of Trinseo Finance Luxembourg S.à r.l., a Luxembourg private limited liability company ( société à responsabilité limitée ) with registered office at 46A avenue John F. Kennedy, L-1855 Luxembourg, Grand Duchy of Luxembourg,

 

registered with the Luxembourg Register of Commerce and Companies under number B 151.012 and having a share capital of USD 10,025,001 (the “ Investment Manager ” and the “ Styron Noteholder ”);
(9)        REGENCY ASSETS DESIGNATED ACTIVITY COMPANY a company incorporated in Ireland with registration number 272959, whose registered office is at 6th Floor, Pinnacle 2, Eastpoint Business Park, Dublin 3, Ireland (the “ Regency Noteholder ”);
(10)      HSBC BANK PLC , a company incorporated in England and Wales (Company Number: 14259) having its registered office at 8 Canada Square, London El4 5HQ (the “ Cash Manager ” and the “ Master Purchaser Account Bank ”);
(11)      TRINSEO HOLDING S.À R.L.  (formerly STYRON HOLDING S.À R.L.), a Luxembourg private limited liability company ( société à responsabilité limitée ) with registered office at 46A avenue John F. Kennedy, L-1855 Luxembourg, Grand Duchy of Luxembourg, registered with the Luxembourg Register of Commerce and Companies under number B 153.582 and having a share capital of US$ 162,815,834.12 (the “ Parent ” and the “ Guarantor ”);
(12)      TMF ADMINISTRATION SERVICES LIMITED , a company incorporated in Ireland, whose registered office is at 3rd Floor, Kilmore House, Park Lane, Spencer Dock, Dublin 1, Ireland (the “ Corporate Administrator ” and the “ Registrar ”); and
(13)      THE LAW DEBENTURE TRUST CORPORATION P.L.C. , a company incorporated with limited liability in England and Wales, having its registered office at Fifth Floor, 100 Wood Street, London EC2V 7EX in its capacity as security trustee under the Styron Security Deed (the “ Styron Security Trustee ”),
(together the “ Parties ”).
IT IS AGREED as follows:
1.          DEFINITIONS AND INTERPRETATION
1.1        Definitions
1.2        In this Deed:
“ 2017 Amendment Effective Date ” means the date of this Deed.
“ Amendment Conditions Precedent ” means the conditions precedent set out in Schedule 1 hereto.
“ Amendments ” means the amendments being effected by this Deed. 
“ Original Master Definitions and Framework Deed ” means the Master Definitions and Framework Deed dated 12 August 2010 and amended on 17 August 2010, 24 May 2011, 4 July 2012, 30 May 2013, 25 June 2015, 4 February 2016 and 31 October 2016 between the Parties.

-  2  -

“ Seller and Servicer Party ” shall have the meaning given to it in Clause 14.1 of the Original Master Definitions and Framework Deed.
“ Transaction Documents ” shall have the meaning given to it in the Original Master Definitions and Framework Deed.
1.3        Incorporation of defined terms
(a)         Unless a contrary indication appears, a term defined in any other Transaction Document has the same meaning in this Deed.
(b)         The principles of construction set out in the Original Master Definitions and Framework Deed shall have effect as if set out in this Deed.
1.4        Clauses
In this Deed any reference to a “Clause” or a “Schedule” is, unless the context otherwise requires, a reference to a Clause or a Schedule to this Deed.
1.5        Designation
In accordance with the Original Master Definitions and Framework Deed, the Instructing Party and the Master Purchaser nominate this Deed a Transaction Document.
2.          CONSENT TO THE STYRON SECURITY TRUSTEE
Each of the Parties (other than the Styron Security Trustee):
(a)         confirms that it has formed its own view in relation to the Amendments without any reliance on the Styron Security Trustee;
(b)         confirms that it consents to the Amendments;
(c)         authorises and directs the Styron Security Trustee to consent to such Amendments and to execute this Deed to effect such Amendments;
(d)         agrees that the Styron Security Trustee shall not be responsible for any losses or Liabilities that may arise under this Deed, the Notes, or any Transaction Document as a result of implementing Clause 2(c) (and the Noteholders irrevocably waive any claims against the Styron Security Trustee in respect of such losses or Liabilities) and shall have no liability for the exercise or non- exercise of any trusts, powers, authorities or discretions vested in the Styron Security Trustee in connection with this Deed, the Amendments, any Transaction Document or any operation of law.

-  3  -

3.           AMENDMENTS 
3.1        Amendment of the Original Master Definitions and Framework Deed
With effect from the 2017 Amendment Effective Date the Original Master Definitions and Framework Deed shall be amended and restated so that it shall be read and construed for all purposes on the terms set out in Schedule 2 hereto.
4.          AMENDMENTS TO BECOME EFFECTIVE
4.1        The Amendments shall take place subject to the satisfaction or waiver by the Cash Manager of each of the Amendment Conditions Precedent (acting reasonably).
5.          REPRESENTATIONS AND WARRANTIES AND COVENANTS
5.1        The Master Purchaser represents and warrants on the terms of the Master Purchaser Warranties, by references to the facts and circumstances as at the 2017 Amendment Effective Date.
5.2        On the date of this Deed and on each Monthly Payment Date, each Trinseo Party represents and warrants that no Trinseo Party, any director or officer, or any employee, agent or Affiliate, of any Trinseo Party or any of its Subsidiaries is:
(a)        a Person that is, or is owned or controlled by Persons that are, the target/subject of any Sanctions; or
(b)        located, organised or resident in a country or territory that is, or whose government is, the target/subject of Sanctions, including, without limitation, currently, Cuba, Iran, North Korea, Sudan, Crimea and Syria.
5.3        On the date of this Deed and on each Monthly Payment Date, each Trinseo Party represents and warrants that no Trinseo Party, nor to the knowledge of any Trinseo Party, any director, officer, agent, employee, affiliate or other person acting on behalf of such Trinseo Party or any of its subsidiaries is aware of or has taken any action, directly or indirectly, that would result in a violation by such persons of any applicable anti-bribery law, including but not limited to, the United Kingdom Bribery Act 2010 (the “ UK Bribery Act ”) and the U.S. Foreign Corrupt Practices Act of 1977 (the “ FCPA ”).  Further, each Trinseo Party represents and warrants that each Trinseo Party and, to the knowledge of each Trinseo Party, its affiliates have conducted their businesses in compliance with the UK Bribery Act, the FCPA and similar laws, rules or regulations and have instituted and maintain policies and procedures designed to provide, and which are reasonably expected to continue to provide, continued compliance therewith.
5.4        Each Trinseo Party shall procure that no Trinseo Entity will directly or indirectly use the proceeds obtained under the Transaction Documents or lend, contribute or otherwise make available such proceeds to any Person:
(a)        to fund any activities or business of or with any Person, or in any country or territory, that, at the time of such funding, is, or whose government is, the subject of Sanctions; or

-  4  -

(b)        in any other manner that would result in a violation of Sanctions by any Person (including the Cash Manager and the Regency Noteholder, whether as underwriter, advisor, investor or otherwise).
5.5        Each Trinseo Party shall procure that no part of the proceeds obtained under the Transaction Documents will be used, directly or indirectly, for any payments that could constitute a violation of any applicable anti-bribery law. 
6.          CONTINUITY AND FURTHER ASSURANCE
6.1        Continuing obligations
The provisions of the Original Master Definitions and Framework Deed and the other Transaction Documents shall, save as amended by this Deed, continue in full force and effect.
6.2        Further assurance
Each of the Parties shall, at the request of the Sellers or the Master Purchaser, and at the expense of the Sellers, do all such acts and things necessary or desirable to give effect to the amendments effected or to be effected pursuant to this Deed.
7.          EXECUTION OF DEED BY PARENT
7.1        The Parent shall execute this Deed on behalf of each Seller and Servicer Party in accordance with Clause 14.1 of the Original Master Definitions and Framework Deed ( Appointment of Parent by Seller and Servicer Parties; Modification and Waiver ).
8.          COSTS, EXPENSES AND INDEMNIFICATION
8.1        The Master Purchaser shall, from time to time on demand of the Styron Security Trustee, reimburse the Styron Security Trustee for all properly incurred, costs and expenses (including legal fees) incurred by it in connection with the negotiation, preparation and execution or purported execution of this Deed.
8.2        The Regency Noteholder and the Master Purchaser hereby agree to indemnify the Styron Security Trustee against all actions, proceedings, claims, demands, liabilities, losses, damages, costs, expenses and charges (including legal expenses and together with value added tax or any similar tax charged or chargeable in respect thereof) which the Styron Security Trustee or any person appointed by it (or their respective officers or employees) may incur directly or indirectly from the exercise of the powers vested in the Styron Security Trustee by or pursuant to the Styron Security Deed or as a result of any actions taken pursuant to this Deed.
9.          GOVERNING LAW AND JURISDICTION
9.1        This Deed and any non-contractual obligations arising out of or in connection with it are governed by English law.

-  5  -

9.2        The Parties submit to the exclusive jurisdiction of the English courts.
10.        MISCELLANEOUS
10.1      Incorporation of terms
The provisions of Clause 8 ( Notices ), Clause 13 ( Waivers; Remedies Cumulative ), Clause 15 ( Entire Agreement ), Clause 16 ( No Liability ), 17 ( Limited Recourse and Non-Petition in Favour of Regency Noteholder ), Clause 18 ( Miscellaneous Provisions ), Clause 19 ( Counterparts ), Clause 21 ( Contracts (Rights of Third Parties) Act 1999 ), and Clause 24 ( Restriction on Enforcement of Security, Non-Petition and Limited Recourse in Favour of the Master Purchaser ) of the Original Master Definitions and Framework Deed shall be incorporated into this Deed as if set out in full in this Deed and as if references in those clauses to “this Deed” are references to this Deed.
This Deed has been entered into on the date stated at the beginning of this Deed.

-  6  -

SCHEDULE 1
CONDITIONS PRECEDENT LIST FOR TRINSEO AR SECURITISATION EIGHTH AMENDMENT 
The Dutch Seller
(1)        Solvency Certificate in respect of the Dutch Seller in form and substance satisfactory to the Cash Manager, dated the 2017 Amendment Effective Date.
Parent
(2)        Copies of the resolutions, in form and substance satisfactory to the Cash Manager, of the board of managers of the Parent authorising the execution, delivery and performance of this Deed, certified by a manager of the Parent as of the 2017 Amendment Effective Date which certificate shall state that the resolutions thereby certified have not been amended, modified, revoked or rescinded.
(3)        A certificate as to the incumbency and signature of the managers or other attorneys authorised to sign this Deed on behalf of the Parent and any certificate or other document to be delivered pursuant thereto, certified by any manager of the Parent together with evidence of the incumbency of such manager.
(4)        Up to date Commercial Register excerpts in respect of the Parent dated no earlier than 10 calendar days prior to the 2017 Amendment Effective Date.
(5)        Solvency Certificate in respect of the Parent in form and substance satisfactory to the Cash Manager, dated the 2017 Amendment Effective Date.
Each Swiss Seller
(6)        Solvency Certificates in respect of each of the Swiss Sellers in form and substance satisfactory to the Cash Manager, dated the 2017 Amendment Effective Date.
German Seller
(7)        Solvency Certificate in respect of the German Seller in form and substance satisfactory to the Cash Manager, dated the 2017 Amendment Effective Date.
U.S. Seller
(8)        Solvency Certificate in respect of the U.S. Seller in form and substance satisfactory to the Cash Manager, dated the 2017 Amendment Effective Date.
U.S. Intermediate Transferor
(9)        A certificate of the secretary or other responsible officer of the U.S. Intermediate Transferor, dated as of the 2017 Amendment Effective Date, and certifying (a) that attached thereto is a true and complete copy of the organisational documents (including all amendments or other modifications thereto) of the U.S. Intermediate Transferor, as in effect on the 2017 Amendment Effective Date and at all times since a date prior to the date of the resolutions described in clause (b) of this paragraph, (b) that attached thereto is a true and

-  7  -

complete copy of the resolutions of the board of directors (or committee thereof), directors, managers or members, as the case may be, of the U.S. Intermediate Transferor authorising the execution, delivery and performance of this Deed and the transactions contemplated hereby and thereby, and that such resolutions have not been amended, modified, revoked or rescinded and are in full force and effect, and (c) the authority and specimen signature of each officer executing this Deed.
(10)        Copies of the latest versions of the organisational documents of the U.S. Intermediate Transferor certified as of a recent date by the appropriate authority of the jurisdiction of the U.S. Intermediate Transferor to be a true and up to date copy of the original, attached as a schedule to the certificate provided under paragraph (10) above.
(11)        Certificates of compliance, of status or of good standing (if applicable), dated as of a recent date, from the Secretary of State or other appropriate authority of the U.S. Intermediate Transferor’s jurisdiction of organization, attached as a schedule to the certificate provided under paragraph (10) above.
(12)        Solvency Certificate in respect of the U.S. Intermediate Transferor in form and substance satisfactory to the Cash Manager, dated the 2017 Amendment Effective Date.
(13)        Compliance Certificate in respect of the U.S. Intermediate Transferor in the form set out in Schedule 3 to the U.S. Intermediate Transfer Agreement dated the 2017 Amendment Effective Date.
Master Purchaser
(14)        Copies of the resolutions, in form and substance satisfactory to the Cash Manager, of the board of directors of the Master Purchaser authorising the execution, delivery and performance of this Deed, certified by an officer of the Master Purchaser as of 2017 Amendment Effective Date which certificate shall state that the resolutions thereby certified have not been amended, modified, revoked or rescinded.
(15)        A certified copy of the power of attorney granted by the Master Purchaser to the attorneys of the Master Purchaser authorised to sign this Deed on behalf of the Master Purchaser.
Legal Opinions
(16)        A Luxembourg legal opinion from Luxembourg counsel to the Parent, addressed to HSBC Bank plc, the Master Purchaser, the Regency Noteholder and the Styron Security Trustee on the capacity and authority of the Guarantor, the Investment Manager and the Styron Noteholder dated the 2017 Amendment Effective Date.
(17)        Reed Smith English enforceability opinion addressed to HSBC Bank plc, the Master Purchaser, the Regency Noteholder and the Styron Security Trustee dated the 2017 Amendment Effective Date in respect of this Deed.
(18)        A U.S. limited liability company opinion (including corporate authority, execution and delivery) from U.S. counsel to the U.S. Intermediate Transferor addressed to HSBC Bank plc, the Master Purchaser, the Regency Noteholder and the Styron Security Trustee dated the 2017 Amendment Effective Date.

-  8  -

General
(19)        Execution of this Deed
(20)        Officer’s Certificate, in form and substance satisfactory to the Cash Manager, confirming that each of the Investment Manager and the Styron Noteholder has not revoked the appointment of the Parent to take any action under Clause 14.1(a) of the Original Master Definitions and Framework Deed.

-  9  -

 

SCHEDULE 2
AMENDED AND RESTATED MASTER DEFINITIONS AND FRAMEWORK DEED

-  10  -

 

SCHEDULE 2	EXECUTION VERSION	
 
TRINSEO EUROPE GMBH (formerly STYRON EUROPE GMBH)
(as Swiss Seller, Swiss Servicer and Chargor)
TRINSEO EXPORT GMBH
(as Swiss Seller, Swiss Servicer and Pledgor)
TRINSEO DEUTSCHLAND ANLAGENGESELLSCHAFT MBH (formerly STYRON
DEUTSCHLAND ANLAGENGESELLSCHAFT MBH)
(as German Seller and German Servicer)
TRINSEO NETHERLANDS B.V. (formerly STYRON NETHERLANDS B.V.)
(as Dutch Seller and Dutch Servicer)
TRINSEO LLC (formerly STYRON LLC)
(as U.S. Seller and U.S. Servicer)
TRINSEO U.S. RECEIVABLES COMPANY SPV LLC
(as U.S. Intermediate Transferor)
STYRON RECEIVABLES FUNDING DESIGNATED ACTIVITY COMPANY
(as Master Purchaser and Chargee)
TRINSEO FINANCE LUXEMBOURG S.À R.L., LUXEMBOURG, ZWEIGNIEDERLASSUNG
HORGEN (formerly STYRON FINANCE LUXEMBOURG S.À R.L., LUXEMBOURG,
ZWEIGNIEDERLASSUNG HORGEN)
(as Investment Manager and Styron Noteholder)
REGENCY ASSETS DESIGNATED ACTIVITY COMPANY
(as Regency Noteholder)
HSBC BANK PLC
(as Cash Manager and Master Purchaser Account Bank)
TRINSEO HOLDING S.À R.L. (formerly STYRON HOLDING S.À R.L.)
(as Parent)
TMF ADMINISTRATION SERVICES LIMITED
(as Corporate Administrator and Registrar)
THE LAW DEBENTURE TRUST CORPORATION P.L.C.
(as Styron Security Trustee)
MASTER DEFINITIONS AND FRAMEWORK DEED

 

 

CONTENTS

Clause	   	Page	
1.	INTERPRETATION	 	
2	
2.	DEFINITIONS	 	
3	
3.	AGREEMENT	 	
61	
4.	JURISDICTION	 	
61	
5.	PARTIES TO CASH MANAGEMENT AGREEMENT	 	
62	
6.	CHANGE OF STYRON SECURITY TRUSTEE	 	
62	
7.	FURTHER ASSURANCES	 	
63	
8.	NOTICES	 	
63	
9.	YIELD PROTECTION INDEMNITIES	 	
71	
10.	DEFAULT INTEREST	 	
72	
11.	SWISS SELLERS, DUTCH SELLER, SWISS SERVICERS AND DUTCH SERVICER INDEMNITIES AND UNDERTAKING BY THE MASTER PURCHASER	 	
73	
12.	FEES, COSTS, EXPENSES AND TAXATION	 	
80	
13.	WAIVERS; REMEDIES CUMULATIVE	 	
84	
14.	APPOINTMENT OF PARENT BY SELLER AND SERVICER PARTIES; MODIFICATION AND WAIVER	 	
85	
15.	ENTIRE AGREEMENT	 	
86	
16.	NO LIABILITY	 	
87	
17.	LIMITED RECOURSE AND NON-PETITION IN FAVOUR OF REGENCY NOTEHOLDER	 	
87	
18.	MISCELLANEOUS PROVISIONS	 	
89	
19.	COUNTERPARTS	 	
91	
20.	CONFIDENTIALITY	 	
91	
21.	CONTRACTS (RIGHTS OF THIRD PARTIES) ACT 1999	 	
92	
22.	STYRON SECURITY TRUSTEE PARTY TO TRANSACTION DOCUMENTS	 	
92	
23.	TRUSTEE ACT	 	
93	
24.	RESTRICTION ON ENFORCEMENT OF SECURITY, NON-PETITION AND LIMITED RECOURSE IN FAVOUR OF THE MASTER PURCHASER	 	
93	
25.	PROVISIONS RELATING TO THE TRANSACTION DOCUMENTS	 	
95	
26.	GOVERNING LAW	 	
96	
27.	FAILURE TO SATISFY INITIAL CONDITIONS PRECEDENT	 	
96	
SCHEDULE 1 PART A TERMINATION EVENTS	 	
98	
PART B PERFECTION EVENTS	 	
102	

i

 	 	 	
SCHEDULE 2 SWISS SERVICER DEFAULTS	 	
104	
SCHEDULE 3 ELIGIBILITY CRITERIA IN RESPECT OF RECEIVABLES	 	
106	
SCHEDULE 4 SPECIAL CONCENTRATION LIMITS	 	
110	
SCHEDULE 5 UNRESTRICTED COUNTRIES	 	
111	
SCHEDULE 6 ELIGIBLE COUNTRIES	 	
113	
SCHEDULE 7 MASTER PURCHASER REPRESENTATIONS, WARRANTIES AND COVENANTS	 	
114	
PART A REPRESENTATIONS AND WARRANTIES	 	
114	
PART B COVENANTS	 	
121	
SCHEDULE 8 EVENTS OF DEFAULT	 	
130	
SCHEDULE 9 INITIAL CONDITIONS PRECEDENT	 	
131	
SCHEDULE 10 ADDITIONAL CONDITIONS PRECEDENT	 	
135	
SCHEDULE 11 STANDARD DOCUMENTATION	 	
136	
PART A SWISS DOCUMENTATION	 	
136	
PART B GERMAN DOCUMENTATION	 	
141	
PART C DUTCH DOCUMENTATION	 	
145	
PART D U.S. DOCUMENTATION	 	
149	
SCHEDULE 12 APPROVED NON-STANDARD DOCUMENTATION OBLIGORS	 	
151	
SCHEDULE 13 ACCOUNT DETAILS	 	
152	
SCHEDULE 14 FORM OF BANK MANDATE	 	
153	
APPENDIX A SELLER CREDIT AND COLLECTION PROCEDURES	 	
161	

ii

 

SCHEDULE 2	EXECUTION VERSION	
 
THIS DEED is made on 12 August 2010 as amended and restated on 17 August 2010, 24 May 2011, 4 July 2012, 30 May 2013, 4 February 2016, 31 October 2016 and 21 December 2017.
BETWEEN :
(1)         TRINSEO EUROPE GMBH (formerly STYRON EUROPE GMBH), a limited liability company incorporated in Switzerland, having its registered office at Zugerstrasse 231, CH-8810 Horgen, Switzerland, being an indirect wholly-owned subsidiary of the Parent (a “ Swiss Seller ”, a “ Swiss Servicer ” and the “ Chargor ”);
(2)         TRINSEO EXPORT GMBH , a limited liability company incorporated in Switzerland, having its registered office at Zugerstrasse 231, CH-8810 Horgen, Switzerland, being an indirect wholly-owned subsidiary of the Parent (a “ Swiss Seller ”, together with Trinseo GmbH, the “ Swiss Sellers ”, a “ Swiss Servicer ”, together with Trinseo GmbH, the “ Swiss Servicers ” and “ Pledgor ”);
(3)         TRINSEO DEUTSCHLAND ANLAGENGESELLSCHAFT MBH (formerly STYRON DEUTSCHLAND ANLAGENGESELLSCHAFT MBH), incorporated in Germany as a limited liability company ( Gesellschaft mit beschränkter Haftung ), registered at the “local court ( Amtsgericht ) of Tostedt under HRB 202609 and having its business address at Kölner Straße 10, 65760 Eschborn, Germany (the “ German Seller ” and the “ German Servicer ”);
(4)         TRINSEO NETHERLANDS B.V . (formerly STYRON NETHERLANDS B.V.), a private company with limited liability ( besloten vennootschap met beperkte aansprakelijkheid ) incorporated in The Netherlands, having its corporate seat ( statutaire zetel ) in Terneuzen, The Netherlands and its registered office at Innovatieweg 14, 4542 NM Hoek (Terneuzen), The Netherlands  (the “ Dutch Seller ” and the “ Dutch Servicer ”);
(5)         TRINSEO LLC (formerly STYRON LLC), a limited liability company formed under the laws of the State of Delaware, having its primary office at 1000 Chesterbrook Boulevard, Suite 300, Berwyn, Pennsylvania 19312, (the “ U.S. Seller ” and the “ U.S. Servicer ”);
(6)         TRINSEO U.S. RECEIVABLES COMPANY SPV LLC, a limited liability company organized under the laws of the State of Delaware, having its primary office at c/o Trinseo LLC at 1000 Chesterbrook Boulevard, Suite 300, Berwyn, Pennsylvania 19312, in its capacity as the U.S. Intermediate Transferor (the “ U.S. Intermediate Transferor ” and together with the Swiss Sellers, the German Seller, the Dutch Seller and the U.S. Seller, the “ Sellers ”);
(7)         STYRON RECEIVABLES FUNDING DESIGNATED ACTIVITY COMPANY a company incorporated in Ireland with registration number 486138, whose registered office is at 3rd Floor, Kilmore House, Park Lane, Spencer Dock, Dublin 1, Ireland (the “ Master Purchaser ”, the “ Pledgee ”, and the “ Chargee ”);
(8)         TRINSEO FINANCE LUXEMBOURG S.À R.L., LUXEMBOURG, ZWEIGNIEDERLASSUNG HORGEN (formerly STYRON FINANCE LUXEMBOURG S.À R.L., LUXEMBOURG, ZWEIGNIEDERLASSUNG HORGEN), a Swiss branch, with offices located at Zugerstrasse 231, CH-8810, Horgen, Switzerland, of Trinseo Finance Luxembourg S.à r.l., a Luxembourg private limited liability company (société à responsabilité limitée) with registered office at 446A avenue John F. Kennedy, L-1855 Luxembourg, Grand-Duchy of Luxembourg, registered with the Luxembourg Register of Commerce and Companies under number B 151.012 and having a share capital of USD 10,025,001 (the “ Investment Manager ” and the “ Styron Noteholder ”);

1

(9)         REGENCY ASSETS DESIGNATED ACTIVITY COMPANY a company incorporated in Ireland with registration number 272959, whose registered office is at 6th Floor, Pinnacle 2, Eastpoint Business Park, Dublin 3, Ireland (the “ Regency Noteholder ”);
(10)       HSBC BANK PLC , a company incorporated in England and Wales (Company Number: 14259) having its registered office at 8 Canada Square, London El4 5HQ (the “ Cash Manager ” and the “ Master Purchaser Account Bank ”);
(11)       TRINSEO HOLDING S.À R.L. (formerly STYRON HOLDING S.À R.L.), a Luxembourg private limited liability company (société à responsabilité limitée) with registered office at 46A avenue John F. Kennedy, L-1855 Luxembourg, Grand Duchy of Luxembourg, registered with the Luxembourg Register of Commerce and Companies under number B 153.582 and having a share capital of US$ 162,815,834.12 (the “ Parent ” and the “ Guarantor ”);
(12)       TMF ADMINISTRATION SERVICES LIMITED , a company incorporated in Ireland, whose registered office is at 3rd Floor, Kilmore House, Park Lane, Spencer Dock, Dublin 1, Ireland (the “ Corporate Administrator ” and the “ Registrar ”); and
(13)       THE LAW DEBENTURE TRUST CORPORATION P.L.C. , a company incorporated with limited liability in England and Wales, having its registered office at Fifth Floor, 100 Wood Street, London EC2V 7EX in its capacity as security trustee under the Styron Security Deed (the “ Styron Security Trustee ”),
(together the “ Parties ”).
BACKGROUND:
(A)       The Sellers wish to sell and the Master Purchaser wishes to purchase Receivables, on the terms and subject to the conditions set out in the Master Receivables Purchase Agreements to be funded by means of the issue of Commercial Paper or by means of drawings under the Liquidity Facility Agreement.
(B)       In connection with the Transaction each of the parties to this Deed will enter into the Transaction Documents to which it is a party on or about the date of this Deed or prior thereto and each of the parties wishes to record its agreement regarding the incorporation of the definitions, the interpretation of certain words and expressions, contained in Clause 2, and, except as otherwise provided in the Transaction Documents, the provisions set out in Clauses 3 to 8 and 10 to 25, into the relevant Transaction Documents and the relevant parties wish to enter into the obligations contained herein on the terms and subject to the conditions contained herein.
1.          INTERPRETATION
1.1        Capitalised terms in this Deed shall, except where the context otherwise requires and save where otherwise defined in this Deed, have the meanings given to them in Clause 2.1 (as it may be amended, varied or supplemented from time to time with the consent of the parties to this Deed) and this Deed shall be construed in accordance with the principles of construction set out in Clauses 2.2 to 2.11.
1.2        Where any party to this Deed from time to time acts in more than one capacity under a Transaction Document, the provisions of this Deed shall apply to it as though it were a separate party in each such capacity except insofar as they require it in one capacity to give any notice or information to itself in another capacity.

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1.3        In the event of any conflict between the terms of the German Receivables Purchase Agreement and this Master Definitions and Framework Deed, the terms of the German Receivables Purchase Agreement shall prevail other than Clause 22 of this Master Definitions and Framework Deed as it relates to the Styron Security Trustee, and in the event of any conflict between the terms of the German Servicing Agreement and this Master Definitions and Framework Deed, the terms of the German Servicing Agreement shall prevail other than Clause 22 of this Master Definitions and Framework Deed as it relates to the Styron Security Trustee. In the event of any conflict between the terms of the Swiss Receivables Purchase Agreement and this Master Definitions and Framework Deed, the terms of the Swiss Receivables Purchase Agreement shall prevail other than Clause 22 of this Master Definitions and Framework Deed as it relates to the Styron Security Trustee.
1.4       In the event of any conflict between the terms of the U.S. Receivables Purchase Agreement and this Master Definitions and Framework Deed, the terms of the U.S. Receivables Purchase Agreement shall prevail other than Clause 22 of this Master Definitions and Framework Deed as it relates to the Styron Security Trustee, in the event of any conflict between the terms of the U.S. Intermediate Transfer Agreement and this Master Definitions and Framework Deed, the terms of the U.S. Intermediate Transfer Agreement shall prevail other than Clause 22 of this Master Definitions and Framework Deed as it relates to the Styron Security Trustee and in the event of any conflict between the terms of the U.S. Servicing Agreement and this Master Definitions and Framework Deed, the terms of the U.S. Servicing Agreement shall prevail other than Clause 22 of this Master Definitions and Framework Deed as it relates to the Styron Security Trustee.
1.5       The various Clauses of this Deed shall be incorporated in the U.S. Transaction Documents only to the extent expressly stated therein.
2.          DEFINITIONS
2.1        In any agreement, instrument or deed expressly and specifically incorporating by reference this Master Definitions and Framework Deed the following expressions shall, except where the context otherwise requires and except where otherwise defined therein, have the following meanings:
“ 2009 Act ” means the Land and Conveyancing Law Reform Act 2009 of Ireland.
“ 2016   Amendment Effective Date ” means 31 October 2016.
“ 2017   Amendment Effective Date ” means 21 December 2017.
“ Account Bank Agreement ” means the agreement so named dated on or about the Closing Date between the Master Purchaser, the Cash Manager, the Master Purchaser Account Bank and the Styron Security Trustee.
“ Account Control Agreements ” means (a) the UK Account Control Deed dated on or about the Closing Date by which the Swiss Sellers have created security over its Collection Accounts, (b) the U.S. Account Control Agreements, (c) the Dutch Collection Account Security Agreement, (d) the Belgian Collection Account Pledge Agreement, (e) the German Account Pledge Agreement, (f) the Trinseo Export German

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Account Pledge Agreement and (g) any other account control agreement entered into between a Seller, the Master Purchaser and the Styron Security Trustee.
“ Account Details ” means the details of each of the Master Purchaser Accounts set out in Schedule 13 of this Framework Deed.
“ Accounting Reference Date ” means, in each year:
(a)        in respect of the Master Purchaser, 31 March;
(b)        in respect of the Swiss Sellers, 31 December;
(c)        in respect of the Swiss Servicers, 31 December;
(d)        in respect of the German Seller, 31 December;
(e)        in respect of the German Servicer, 31 December;
(f)           in respect of the Dutch Seller, 31 December;
(g)        in respect of the Dutch Servicer, 31 December;
(h)        in respect of the U.S. Seller, 31 December;
(i)         in respect of the U.S. Servicer, 31 December; and
(j)         in respect of the U.S. Intermediate Transferor, 31 December.
“ Accounting Reference Period ” means, in respect of a Seller, the Master Purchaser or a Servicer, the period from (and including) an Accounting Reference Date in respect of such Person to (but excluding) the next Accounting Reference Date in respect of such Person.
“ Accounts ” means the Master Purchaser Accounts and any other account of the Master Purchaser to be established pursuant to the Account Bank Agreement, each an “Account”.
“ Additional Conditions Precedent ” means the conditions precedent set out in Schedule 10 ( Additional Conditions Precedent ).
“ Additional Note Issue Notice ” means a notice of an Additional Offer delivered by the Master Purchaser to each Noteholder in accordance with Clause 6.1 ( Additional Offer ) of the Variable Loan Note Issuance Deed.
“ Additional Offer ” means an offer of an increase in the Principal Amount Outstanding of a Note pursuant to an Additional Note Issue Notice.
“ Additional Principal Amount ” means the Regency USD Note Additional Principal Amount, Regency EUR Note Additional Principal Amount, the Styron USD Note Additional Principal Amount or the Styron EUR Note Additional Principal Amount, as applicable.

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“ Additional Subscription Price ” means the amount which a Noteholder is required to pay for each $1 or €1 in Additional Principal Amount of the relevant Notes as specified in the relevant Additional Offer.
“ Adjusted Spot Rate ” means the rate advised by the Cash Manager from time to time.
“ Affected Person ” means any of the Regency Noteholder, the Instructing Party, the Liquidity Facility Provider and Styron Security Trustee.
“ Affiliate ” or “ affiliate ” means, as to any Person, any other Person that, directly or indirectly, is in control of, is controlled by or is under common control with such Person or is a director or officer of such Person.
“ Aggregate Note Principal Amount Outstanding ” means the aggregate Principal Amount Outstanding (calculated using the USD Equivalent of such amounts where applicable) of the Regency USD Note Principal Amount Outstanding, the Regency EUR Note Principal Amount Outstanding, the Styron USD Note Principal Amount Outstanding and the Styron EUR Note Principal Amount Outstanding.
“ Aggregate Obligor Overconcentration Amount ” means, as of any Determination Date, an amount equal to the sum of the Obligor Overconcentration Amounts of all Obligors at the end of the preceding Business Day.
“ Aggregate Receivables Balance ” means, as at any Determination Date, the USD Equivalent of the aggregate Outstanding Balances of all Eligible Receivables which are Purchased Receivables.
“ Aggregate Regency Note Principal Amount Outstanding ” means the aggregate Principal Amount Outstanding (calculated using the USD Equivalent of such amounts where applicable) of the Regency USD Note Principal Amount Outstanding and the Regency EUR Note Principal Amount Outstanding.
“ Ancillary Rights ” means in relation to a Right, all ancillary rights, accretions and supplements to such Right, including any guarantees or indemnities in respect of such Right.
“ Applicable Stress Factor ” means 2.5.
“ Approved Currencies ” means Euro and US Dollars but, (i) in the case of the German Receivables Purchase Agreement, Euro only, (ii) in the case of the Dutch Receivables Purchase Agreement, Euro only and (iii) in the case of the U.S. Receivables Purchase Agreement and the U.S. Intermediate Transfer Agreement, US Dollars only.
“ Asset ” means (i) any Contract, (ii) all Receivables in respect of any Contract and (iii) the Asset Records in respect thereof, and together assigned or proposed to be assigned by a Seller to the U.S. Intermediate Transferor or the Master Purchaser in accordance with the terms of a Master Receivables Purchase Agreement.
“ Asset Records ” means the original or any copies of the Contracts and all documents and records, in whatever form or medium, relating to the Contracts, including all computer tapes and disks specifying, among other things Obligor details, the amounts

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and dates on which payments are due and are paid under the Contracts and identifying any Contract which has been subject to a hostile termination or written off.
“ Asset Shortfall ” means as at any date of determination:
(a)        the USD Equivalent of the amount by which aggregate of:
(i)        the EUR Proportion of the Purchase Base;
(ii)       the balance standing to the credit of the Collection Accounts and the Master Purchaser Accounts denominated in EUR; and
(iii)      the balance standing to the credit of the Collection Accounts and the Master Purchaser Accounts not denominated in EUR (for the purposes of this calculation, these amounts shall be converted to EUR using the Adjusted Spot Rate),
is, or would be where applicable, following any funding, purchase or repayment occurring or anticipated to occur immediately prior to such determination on any day, less than the aggregate Principal Amount Outstanding of the Regency EUR Note Principal Amount Outstanding; or
(b)        the amount by which the aggregate of:
(i)        the USD Proportion of the Purchase Base;
(ii)       the balance standing to the credit of the Collection Accounts and the Master Purchaser Accounts denominated in USD; and
(iii)      the balance standing to the credit of the Collection Accounts and the Master Purchaser Accounts not denominated in USD (for the purposes of this calculation, these amounts shall be converted to USD using the Adjusted Spot Rate),
is, or would be where applicable, following any funding, purchase or repayment occurring or anticipated to occur immediately prior to such determination on any day, less than the aggregate Principal Amount Outstanding of the Regency USD Note Principal Amount Outstanding it being specified that there should be no double counting between the amounts referred to in paragraphs (a)(ii) and (a)(iii) and the amounts referred to paragraphs (b)(ii) and (b)(iii) of this definition.
“ Assigned Rights ” means the Benefit of the Contracts and the Receivables assigned or to be assigned to the U.S. Intermediate Transferor or the Master Purchaser by a Seller in accordance with the terms of a Master Receivables Purchase Agreement.
“ Auditors ” means:
(a)        in respect of the Master Purchaser, such firm of accountants as may be appointed by the Master Purchaser;

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(b)       in respect of the Swiss Sellers, PricewaterhouseCoopers LLP or such other firm of accountants as may be appointed by the Swiss Sellers;
(c)       in respect of the Swiss Servicers, PricewaterhouseCoopers LLP or such other firm of accountants as may be appointed by the Swiss Servicers;
(d)       in respect of the German Seller, PricewaterhouseCoopers LLP or such other firm of accountants as may be appointed by the German Seller;
(e)       in respect of the German Servicer, PricewaterhouseCoopers LLP or such other firm of accountants as may be appointed by the German Servicer;
(f)        in respect of the Dutch Seller, PricewaterhouseCoopers LLP or such other firm of accountants as may be appointed by the Dutch Seller;
(g)       in respect of the Dutch Servicer, PricewaterhouseCoopers LLP or such other firm of accountants as may be appointed by the Dutch Servicer;
(h)       in respect of the U.S. Seller, PricewaterhouseCoopers LLP or such other firm of accountants as may be appointed by the U.S. Seller;
(i)        in respect of the U.S. Servicer, PricewaterhouseCoopers LLP or such other firm of accountants as may be appointed by the U.S. Servicer; and
(j)        in respect of the U.S. Intermediate Transferor, PricewaterhouseCoopers LLP or such other firm of accountants as may be appointed by the U.S. Intermediate Transferor.
“ Authorised Investments ” means, in respect of investments made by a Seller of funds standing in the balance of the US Dollar and Euro denominated Collection Accounts, deposits made into accounts held in the name of Styron Receivables Funding Designated Activity Company at HSBC Bank plc or Deutsche Bank AG pursuant to a Bank Mandate.
“ Authorised Signatory ” means, in relation to any Transaction Party, any Person who is duly authorised and in respect of whom a certificate has been provided signed by a director or another duly authorised Person of such Transaction Party setting out the name and signature of such Person and confirming such Person’s authority to act.
“ Bank Mandate ” means a Bank Mandate that may be in place from time to time, among the Servicers, the Master Purchaser and HSBC plc or Deutsche Bank AG London in the form attached as Schedule 14 ( Form of Bank Mandate ).
“ Bank Receivables ” has the meaning given in Clause 3 ( Charge ) of the UK Account Control Deed.
“ Basel III ” means:
(a)       the agreements on capital requirements, a leverage ratio and liquidity standards contained in “Basel III: A global regulatory framework for more resilient banks and banking systems”, “Basel III: International framework for liquidity risk measurement, standards and monitoring” and “Guidance for national authorities operating the

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countercyclical capital buffer” published by the Basel Committee on Banking Supervision in December 2010, each as amended, supplemented or restated;
(b)       the rules for global systemically important banks contained in “Global systemically important banks: assessment methodology and the additional loss absorbency requirement – Rules text” published by the Basel Committee on Banking Supervision in November 2011, as amended, supplemented or restated; and
(c)       any further guidance or standards published by the Basel Committee on Banking Supervision relating to “Basel III”.
“ Belgian Collection Account Pledge Agreement ” means the Belgian Collection Account Pledge Agreement dated on or about the Dutch Closing Date by which the Dutch Seller has created security over the Belgian law governed Collection Accounts and any other account control agreements entered into among the Dutch Seller, the Master Purchaser, the Styron Security Trustee and the relevant Collection Account Bank.
“ Benefit ” in respect of any Right held, assigned, conveyed, transferred, charged, sold or disposed of by any Person shall be construed so as to include:
(a)       all right, title, interest and benefit, present and future, actual and contingent (and interests arising in respect thereof) of such Person in, to, under and in respect of such Right and all Ancillary Rights in respect of such Right;
(b)       all monies and proceeds payable or to become payable under, in respect of, or pursuant to such Right or its Ancillary Rights and the right to receive payment of such monies and proceeds and all payments made including, in respect of any bank account, all sums of money which may at any time be credited to such bank account together with all interest accruing from time to time on such money and the debts represented by such bank account;
(c)       the benefit of all covenants, undertakings, representations, warranties and indemnities in favour of such Person contained in or relating to such Right or its Ancillary Rights;
(d)       the benefit of all powers of and remedies for enforcing or protecting such Person’s right, title, interest and benefit in, to, under and in respect of such Right or its Ancillary Rights, including the right to demand, sue for, recover, receive and give receipts for proceeds of and amounts due under or in respect of or relating to such Right or its Ancillary Rights; and
(e)       all items expressed to be held on trust for such Person under or comprised in any such Right or its Ancillary Rights, all rights to deliver notices or take such steps as are required to cause payment to become due and payable in respect of such Right and its Ancillary Rights, all rights of action in respect of any breach of or in connection with any such Right and its Ancillary Rights and all rights to receive damages or obtain other relief in respect of such breach.

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“ Billed Receivables ” means, on the relevant Purchase Date, a Receivable that has arisen under a Contract in respect of the sale of chemical products to an Obligor and in respect of which an Invoice has been issued on or prior to such Purchase Date.
“ Breach of Duty ” means in relation to any Person, a wilful default, fraud, illegal dealing, negligence or breach of any agreement by such Person.
“ Business Day ” means a day (other than a Saturday or a Sunday) on which banks are generally open for business in London, Dublin, Zurich, Rotterdam, New York, Dallas, Texas, and, except with respect to any U.S. Transaction Document, which is a TARGET Day.
“ Carry Cost Stress Rate ” means the aggregate (expressed as a percentage) of:
(i)           2 x the current proportion (expressed as a percentage) of the Receivables from Unrestricted Countries divided by the Net Eligible Receivables Balance, and
(ii)       4 x the current proportion (expressed as a percentage) of the Receivables from Eligible Countries divided by the Net Eligible Receivables Balance.
“ Carrying Cost Reserve ” means, as of any date of determination, an amount equal to:
(NERB x CCRR)
Where:

NERB	=	the lesser of (i) the Facility Limit and (ii) the Net Eligible Receivables Balance as of the close of business of the Investment Manager on such date.	
CCRR	=	The Carrying Cost Reserve Ratio on such date.	
 
“ Carrying Cost Reserve Ratio ” means, on any Monthly Reporting Date, an amount expressed as a percentage equal to:
(i)        the Reuters Screen Rate for 1 months USD plus 3%, multiplied by
(ii)       the Carry Cost Stress Rate, multiplied by
(iii)      the Days Sales Outstanding, divided by
(iv)         360.
“ Cash Control Events ” means the occurrence of any of the following events:
(a)          any Termination Event that has not been remedied or waived;
(b)          an event that but for the giving of notice or lapse of time would constitute a Swiss Servicer Default, a German Servicer Default, a Dutch Servicer Default or a U.S. Servicer Default of the kind described in paragraph (a)(ii), (a)(iii) or (c) of Schedule 2; or

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(c)          an event that but for the giving of notice or the lapse of time would constitute a Termination Event of the kind described in paragraph (a) of Part A of Schedule 1 or a Perfection Event of the kind described in paragraphs (a) to (e) of Part B of Schedule 1.
“ Cash Management Agreement ” means the agreement so named dated 12 August 2010 between the Master Purchaser, the Cash Manager, the Regency Noteholder, the Styron Noteholder and the Styron Security Trustee, as amended and restated on 24 May 2011 and on or around the Dutch Closing Date.
“ Cash Management Report ” means a report prepared by the Cash Manager in accordance with Paragraph 23 ( Cash Management Report ) of Schedule 1 ( Services to be provided by Cash Manager ) of the Cash Management Agreement.
“ Cash Management Services ” means the services to be provided by the Cash Manager as set out in Schedule 1 ( Services to be provided by Cash Manager ) of the Cash Management Agreement.
“ Cash Manager ” means HSBC Bank plc in its capacity as Cash Manager in accordance with the terms of the Cash Management Agreement.
“ Cash Manager Covenants ” means the covenants made by the Cash Manager contained in Schedule 3 ( Cash Manager Covenants ) of the Cash Management Agreement.
“ Cash Manager Event ” means any of the events set out in Clause 14 ( Cash Manager Events ) of the Cash Management Agreement.
“ Cash Manager Event Notice ” means a notice to the Cash Manager from the Master Purchaser or the Styron Security Trustee advising the Cash Manager of the occurrence of a Cash Manager Event.
“ Cash Manager Records ” means the original or any copies of all documents and records, in whatever form or medium, relating to the Cash Management Services including all computer tapes, files and disks relating to the Cash Management Services.
“ Cash Manager Reporting Date ”  means the Business Day prior to each Monthly Payment Date.
“ Cash Manager Termination Date ” means the date specified in a Cash Manager Termination Notice or in a notice delivered pursuant to Clause 17.1 ( Termination of Appointment by Notice ) of the Cash Management Agreement or determined in accordance with Clause 17.2 (A greement to terminate on appointment of Successor Cash Manager ) of the Cash Management Agreement.
“ Cash Manager Termination Notice ” means a notice to the Cash Manager from the Master Purchaser or the Styron Security Trustee delivered in accordance with the terms of Clause 16 ( Termination on Delivery of Cash Manager Termination Notice ) of the Cash Management Agreement.

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“ Cash Manager Warranties ” means the warranties made by the Cash Manager contained in Schedule 2 ( Cash Manager Representations and Warranties ) of the Cash Management Agreement.
“ Change of Control ” means the occurrence of any of the following:
(a)          a Person owns beneficially and of record directly or indirectly ordinary shares representing more than 50% of the voting power of the Parent and the Sellers of the votes capable of being cast; and
(b)          that Person is otherwise not acceptable to the Master Purchaser (acting reasonably) or the Cash Manager (acting reasonably),
provided that an initial underwritten public offering of the ordinary share capital of any Sellers, any member of the Sellers’ group or any of their holding companies to be listed or traded on any recognised investment exchange or market in any country shall not of itself be considered a Change of Control.
“ Charge ” means the charge held by the Chargee over all of the Bank Receivables pursuant to Clause 3 ( Charge ) of the UK Account Control Deed.
“ Charged Account ” means the account(s) specified in the relevant Account Control Agreement.
“ Charged Property ” means all the property of the Master Purchaser which is subject to the Security.
“ Closing Date ” means 12 August 2010.
“ Collection Account Bank ” means (a) Deutsche Bank AG through its relevant branches in the jurisdictions where Collection Accounts are held (and in the case of Collection Accounts in Spain, Deutsche Bank, Sociedad Anónima Española and in the case of Collection Accounts in the United States, Deutsche Bank Trust Company Americas), as applicable, (b) Bank of America, National Association through its relevant branches in the U.S. where Collection Accounts are held or (c) such other bank appointed from time to time in replacement thereof with the consent of the Cash Manager to hold the Collection Accounts and the Investment Manager Operating Accounts.
“ Collection Accounts ” means:
(a)          accounts in the name of a Seller with the Collection Account Bank which are denominated in Euro and US Dollars into which Collections are received in respect of Euro and US Dollar amounts; and
(b)       with respect to any Currency Receivables, any other accounts in the name of a Seller with the Collection Account Bank which are denominated in the same currency as the relevant Currency Receivable (the “ Currency Receivables Collection Accounts ”).

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“ Collection Ratio ” means, as at any Determination Date, the fraction (expressed as a percentage) calculated as:
(a)       the aggregate amount of Collections received during the Determination Period ending on that Determination Date; divided by
(b)       the aggregate Outstanding Balance of all Purchased Receivables which were outstanding on the first day of the preceding Determination Period.
“ Collections ” means, with respect to any Purchased Receivable, all cash collections and other cash proceeds of such Receivable (including cash proceeds of cheques, promissory notes, bills of exchange or other instruments or wire transfers) received into the Collection Accounts during a Determination Period, including amounts received in respect of VAT, if any, all finance charges, if any, all cash proceeds of the Related Security with respect to such Receivable, and any amounts received from a Seller in respect of Deemed Collections of such Receivable, as well as, for the avoidance of doubt, all amounts received in relation to a Purchased Receivable between the Business Day prior to the Offer in respect of such Purchased Receivable and the day such Offer is accepted by the Master Purchaser or the U.S. Intermediate Transferor, as applicable.
“ Commercial Paper ” means Euro or USD denominated commercial paper notes issued by Regency Assets Designated Activity Company or Regency Markets No. 1 LLC the proceeds of which are provided to the Master Purchaser as subscription proceeds for the issue of a Regency EUR Note or a Regency USD Note or which directly or indirectly refinance commercial paper notes the proceeds of which were previously so provided to the Master Purchaser.
“ Conditions ” means the terms and conditions of the Notes, as any of the same may from time to time be modified in accordance with the conditions and any reference to a particular numbered Condition shall be construed in relation to the Notes accordingly.
“ Contract ” means a contract (which may be an order and confirmation subject to standard terms and conditions) concluded between a Seller and an Obligor for the supply of chemical products pursuant to which Receivables arise.
“ Core Eligibility Criteria ” means the criteria listed in Schedule 1 ( Representations and Warrantie s), Part B ( Representations and warranties relating to the Purchased Receivables ), and items (a), (e) and (x) of the German Receivables Purchase Agreement.
“ Corporate Administrator ” means TMF Administration Services Limited.
“ Corporate Services Agreement ” means the corporate services agreement dated on or about the Closing Date between the Corporate Administrator and the Master Purchaser.
“ Countries Limit ” means an aggregate cap limit for Eligible Receivables that are owed by Obligors from Eligible Countries of 35% of the USD Equivalent of the Outstanding Balance of all Purchased Receivables.
“ Country Credit Rating Overconcentration Amount ” means, on any Determination Date, the aggregate amount of Receivables owed by Obligors in Non-Investment Grade Countries that exceed 10% of the USD Equivalent of the Outstanding Balances of the Purchased Receivables.

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“ Country Overconcentration Amount ” means, on any Determination Date, the aggregate amount of Eligible Receivables owed by Obligors from Eligible Countries that exceed the Countries Limit.
“ Court ” means the courts of England and Wales.
“ Covenant to Pay ” means the Master Purchaser’s undertaking to pay the Secured Amounts pursuant to Clause 2 ( Master Purchaser’s Undertaking to Pay ) of the Styron Security Deed.
“ CP Rate ” means at any time, the weighted average of the funds rates (expressed as an interest rate per annum) of the Commercial Paper then outstanding and floored at zero including any hedging costs and dealer commissions.
“ Currency Limit ” means an aggregate cap limit of 10% of the USD Equivalent of the aggregate Outstanding Balance of all Purchased Receivables for Receivables that are Currency Receivables.
“ Credit Agreement ” means the credit agreement under which the Lenders (as defined therein) agreed to provide credit facilities to Trinseo Materials Operating S.C.A and Trinseo Materials Finance, Inc. as the Borrowers (as defined therein) pursuant to a US$1,075,000,000 credit agreement dated 6 September 2017 and entered into by, among others, (i) the Borrower (as defined therein); (ii) the Guarantors (as defined therein) party thereto from time to time; (iii) Deutsche Bank AG New York Branch as Administrative Agent (as defined therein), Collateral Agent (as defined therein), L/C Issuer (as defined therein) and Swing Line Lender (as defined therein) and (iv) the Lenders (as defined therein) from time to time party thereto.
“ Currency Receivables ” means Receivables where the payment due from the Obligor is in a currency other than Euro or USD.
“ Currency Reserve ” means the sum of:
(a)       the USD Equivalent of the outstanding principal amount of each non- Euro/USD pool of Receivables multiplied by the Currency Volatility percentage for the relevant currency, plus,
(b)       the USD Equivalent of the outstanding principal amount by which the Currency Receivables exceeds the Currency Limit.
“ Currency Volatility ” means the maximum movement in the exchange rate of the relevant currency against the Euro in any thirty (30) day period over the preceding twelve (12) months, expressed as a percentage.
“ Daily Reporting Date ” means each date on which a Swiss Servicer’s Daily Report, a German Servicer’s Daily Report, a Dutch Servicer’s Daily Report or a U.S. Servicer’s Daily Report is delivered.
“ Days Sales Outstanding ” means the maximum Rolling Average Turnover Ratio recorded over the preceding twelve (12) months.

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“ Debt ” means (i) indebtedness for borrowed money, (ii) obligations evidenced by bonds, debentures, notes or other similar instruments, (iii) obligations to pay the deferred purchase price of property or services otherwise than in the ordinary course of business and not for the purpose of raising debt or finance, (iv) obligations as lessee under leases which shall have been or should be, in accordance with generally accepted accounting principles, recorded as capital leases, and (v) obligations under direct or indirect guaranties in respect of, and obligations (contingent or otherwise) to purchase or otherwise acquire, or otherwise to assure a creditor against loss in respect of, indebtedness or obligations of others of the kinds referred to in (i) to (iv) above.
“ Deemed Collections ” means, any amounts paid or payable by a Seller to the Master Purchaser or the U.S. Intermediate Transferor, as applicable, pursuant to clauses 7.1 or 7.2 of the relevant Master Receivables Purchase Agreement.
“ Default Interest ” means in respect of the Notes, the default interest payable in accordance with Condition 9.
“ Default Ratio ” means, as at any Monthly Reporting Date, the fraction (expressed as a percentage) calculated for the immediately preceding Determination Period as:
(a)        the sum of:
(i)        the aggregate Outstanding Balance of Purchased Receivables that were more than 90 days past their Due Date as at the Determination Date for such Determination Period but equal to or less than 120 days past their Due Date; plus
(ii)       without duplication, the aggregate Outstanding Balance of all Purchased Receivables which became Written-off Receivables during the Determination Period ending on such Determination Date; divided by
(b)        the sales generated in the Determination Period five (5) months prior to the current Determination Period.
“ Defaulted Receivable ” means a Purchased Receivable:
(a)        in respect of which all or part of its Outstanding Balance remains unpaid past its Due Date for more than 90 days; and
(b)        which has become a Written-off Receivable.
“ Deferred Purchase Price ” has the meaning given to it in clause 3.1 of the Swiss Receivables Purchase Agreement, the U.S. Intermediate Transfer Agreement or the Dutch Receivables Purchase Agreement (as applicable).
“ Delinquency Ratio ” means the ratio (expressed as a percentage) computed as of each Monthly Reporting Date for the immediately preceding Determination Period by dividing (i) the USD Equivalent of the aggregate Outstanding Balance of all Delinquent Receivables as of the end of such Determination Period by (ii) the USD Equivalent of the sales generated in the Determination Period four (4) months prior to the current Determination Period.

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“ Delinquent Receivable ” means a Purchased Receivable:
(a)        in respect of which all or part of its Outstanding Balance remains unpaid for more than 60 days but equal to or less than 90 days past its original Due Date; and
(b)        which is not a Defaulted Receivable.
“ Determination Date ” means the last day of each Determination Period.
“ Determination Period ” means each calendar month during the Securitisation Availability Period.
“ Diluted Receivable ” means any Receivable in respect of which an event giving rise to a Dilution has occurred.
“ Dilution ” means any Purchased Receivable or part thereof that is either:
(a)        reduced cancelled, or adjusted as a result of:
(i)        any defective, rejected or returned goods or merchandise or any failure by the relevant Seller to deliver any goods or merchandise or otherwise to perform under the underlying Contract; or
(ii)       any change in the terms of or cancellation of, a Contract or any cash discount, discount for quick payment or other credit, refund, allowance, reverse invoice, discount or other adjustment by the relevant Seller which reduces the amount payable by the Obligor on the related Purchased Receivable (in each case, except any such change or cancellation made in settlement of such Receivable in accordance with the relevant Seller’s Credit and Collection Policies resulting from or relating to the financial inability to pay or insolvency of the Obligor of such Purchased Receivable); or
(iii)      any set-off by an Obligor in respect of any claim by such Obligor as to amounts owed by it on the related Purchased Receivable (whether such claim arises out of the same or a related transaction or an unrelated transaction); or
(b)        subject to any specific dispute, offset, counterclaim or defence except the discharge in insolvency or any analogous proceeding of the Obligor thereof.
“ Dilution Horizon Ratio ” means the aggregate sales generated in the current Determination Period divided by the Net Eligible Receivables Balance of the relevant day of the current Determination Period.
“ Dilution Ratio ” means, as at any Monthly Reporting Date, the fraction (expressed as a percentage) calculated for the immediately preceding Determination Period by dividing:
(a)        the aggregate Dilution in respect of Diluted Receivables of which a Deemed Collection is required to be made under clause 7.2 of the relevant Master

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Receivables Purchase Agreement (without double counting under the U.S. Receivables Purchase Agreement and the U.S. Intermediate Transfer Agreement) during the Determination Period ending on such Determination Date; by
(b)          the aggregate sales generated in the preceding Determination Period.
“ Dilution Reserve Floor ” means 5%.
“ Dilution Reserve Ratio ” means as of any Monthly Reporting Date, and continuing until (but not including) the next Monthly Reporting Date, an amount (expressed as a percentage) that is calculated as follows:

DRR	=	( SF x ADR ) + ( HDR-ADR ) x ( HDR/ADR )   x DHR	
 	 	 	
where:	 	 	
 	 	 	
DRR	=	the Dilution Reserve Ratio;	
 	 	 	
SF	=	the Applicable Stress Factor;	
 	 	 	
ADR	=	the “Average Dilution Ratio” defined as the twelve-month rolling average of the Dilution Ratios that occurred during the period of twelve consecutive Determination Periods ending immediately prior to such earlier Monthly Reporting Date;	
 	 	 	
HDR	=	the “Highest Dilution Ratio”, defined as the highest Dilution Ratio that occurred during the period of twelve consecutive Determination Periods ending immediately prior to such earlier Monthly Reporting Date; and	
 	 	 	
DHR	=	the Dilution Horizon Ratio.	
 
“ Direct Debit ” means a written instruction of an Obligor authorising its bank to honour a request of a Seller to debit a sum of money on specified dates from the account of the Obligor for credit to an account of that Seller.
“ Direct Debiting Scheme ” means the system for the manual or automated debiting of bank accounts by Direct Debit operated in accordance with the principal rules of certain members of the Association for Payment Clearing Services.
“ Distribution Ledgers ” means the Distribution USD Ledger and the Distribution EUR Ledger.
“ Distribution EUR Ledger ” means the EUR ledger established and maintained pursuant to the Cash Management Agreement.
“ Distribution USD Ledger ” means the USD ledger established and maintained pursuant to the Cash Management Agreement.
“ Due Date ” means, in respect of any Billed Receivable, the date specified in the relevant Invoice, and, in respect of any Unbilled Receivable, means the expected date (as determined according to current business practices of a Seller) on which such

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Receivable will be payable when invoiced in accordance with the relevant Seller’s Credit and Collection Procedures and the applicable Contract.
“ Dutch Closing Date ” means the date of the Dutch Receivables Purchase Agreement.
“ Dutch Collection Accounts ” means the Collection Accounts owned by the Dutch Seller, which receive Collections related to the Dutch Purchased Receivables sold by the Dutch Seller to the Master Purchaser pursuant to the Dutch Receivables Purchase Agreement.
“ Dutch Collection Account Security Agreement ” means the Dutch Collection Account Security Agreement dated on or about the Dutch Closing Date by which the Dutch Seller has created security over the Dutch Collection Accounts and any other account control agreements entered into among the Dutch Seller, the Master Purchaser, the Styron Security Trustee and the relevant Collection Account Bank.
“ Dutch Funding Date ” means the day falling two Business Days after the day the first Offer is delivered under the Dutch Receivables Purchase Agreement or such other date as may be agreed by the Dutch Seller and the Cash Manager.
“ Dutch Purchased Receivables ” means the Receivables purchased by the Master Purchaser on the terms of the Dutch Receivables Purchase Agreement.
“ Dutch Receivables Purchase Agreement ” means the Dutch receivables purchase agreement dated the Dutch Closing Date between the Dutch Seller, the Investment Manager, the Master Purchaser and the Styron Security Trustee.
 “ Dutch Seller ” means Trinseo Netherlands B.V. (formerly Styron Netherlands B.V.) incorporated in The Netherlands, in its capacity as seller of Receivables to the Master Purchaser under the Dutch Receivables Purchase Agreement.
“ Dutch Seller Credit and Collection Procedures ” means the Seller’s Credit and Collection Procedures with respect to the Dutch Seller.
“ Dutch Servicer ” means the person appointed by the Master Purchaser under the Dutch Servicing Agreement to manage and provide administration and collection services in relation to the Purchased Receivables purchased by the Master Purchaser pursuant to the Dutch Receivables Purchase Agreement, being Styron Netherlands B.V. at the Dutch Funding Date.
“ Dutch Servicer Default ” means the occurrence of any of the events described in Schedule 2 hereto as if each reference therein to “Swiss Servicer” was a reference to “Dutch Servicer”, each reference to “Swiss Receivables Purchase Agreement” was a reference to “Dutch Receivables Purchase Agreement” and each reference to “Swiss Servicing Agreement” was a reference to “Dutch Servicing Agreement”.
“ Dutch Servicer’s Daily Report ” means any document prepared by the Dutch Servicer in accordance with Clause 7.2 ( Dutch Servicer’s Daily Reports ) of the Dutch Servicing Agreement, provided that all data required to be included in the Dutch Servicer’s Daily Report shall be consolidated in the Swiss Servicers’ Daily Report.

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“ Dutch Servicer’s Monthly Report ” means any document prepared by the Dutch Servicer in accordance with Clause 7.1 ( Dutch Servicer’s Monthly Reports ) of the Dutch Servicing Agreement, provided that all data required to be included in the Dutch Servicer’s Monthly Report shall be consolidated in the Swiss Servicer’s Monthly Report.
“ Dutch Servicer Report ” means the Dutch Servicer’s Daily Report or the Dutch Servicer’s Monthly Report (as the case may be).
“ Dutch Servicing Agreement ” means the servicing agreement to be dated the Dutch Closing Date relating to the Purchased Receivables purchased by the Master Purchaser pursuant to the Dutch Receivables Purchase Agreement and made between the Master Purchaser, the Dutch Servicer and the Styron Security Trustee.
“ Dutch Servicing Fees ” means the fees referred to in clause 13 of the Dutch Servicing Agreement.
“ Eligibility Criteria ” means the criteria set out in Schedule 3 of this Deed.
“ Eligible Country ” means a country that is not an Unrestricted Country (or has not been designated an Unrestricted Country by the Regency Noteholder) and is listed in Schedule 6.
“ Eligible Institution ” means a bank or financial institution duly authorised in respect of its activities under the laws and regulations of (i) the United Kingdom or (ii) a member state of the European Union, the short term unsecured and unsubordinated debt obligations of which are rated at least P-1 by Moody’s and A-1 by S&P.
“ Eligible Obligors ” means Obligors who are:
(a)        customers of a Seller granted credit in accordance with that Seller’s normal procedures and billed by or on behalf of that Seller on regular invoices;
(b)          at the time of sale of the Receivables to the Master Purchaser, solvent within the meaning of Section 123(1) of the Insolvency Act 1986 or the equivalent legislation in the jurisdiction in which the Obligor is located;
(c)        at the time of sale of the Receivables to the Master Purchaser, not in liquidation, administration or receivership (or analogous proceedings) under the laws of the jurisdiction of their incorporation;
(d)        resident in an Eligible Country or an Unrestricted Country;
(e)        neither an Affiliate of either Parent or a Seller (other than a portfolio company of any shareholder) nor a government or a government subdivision or government agency;
(f)        a corporation, limited liability company, business trust or other Person other than an individual; and
(g)        not subject to any United Nations, United Kingdom, European Union, Swiss, Dutch or U.S. sanctions or other similar measures implemented or effective in

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the United Kingdom, European Union, Switzerland, The Netherlands or the U.S. nor carrying on business in a country to which any such sanctions or other similar measures apply, or otherwise the target of any such sanctions or other similar measures.
“ Eligible Pool Balance ” means, as at any date of determination, the USD Equivalent of the Outstanding Balance of all Eligible Receivables, reduced (for the avoidance of doubt without double counting or duplication) by the sum of:
(a)        USD Equivalent of the Collections which have not reduced the Outstanding Balance and have not yet been credited to the Collection Accounts;
(b)          the aggregate USD Equivalent of the outstanding amount of deposits or advance payments received by a Seller from any Obligors which are not Collections received in respect of Purchased Receivables;
(c)        the aggregate USD Equivalent of the amount of all credit notes, refunds, discounts, allowances or reverse invoices permitted or issued by a Seller against any Purchased Receivable at such time including accruals for such amounts;
(d)        the aggregate USD Equivalent of all potential set-off amounts representing amounts owed by a Seller to any Obligor ( provided that if the related Contract expressly states that such Obligor waives its right of set-off, amounts owed by a Seller to such Obligor shall not be considered a potential set-off for the purposes hereof);
(e)        the aggregate USD Equivalent of the Outstanding Balance of Receivables which are Defaulted Receivables and Delinquent Receivables (without double counting the deduction of such Defaulted Receivables and Delinquent Receivables in the Outstanding Balance of Eligible Receivables and in this paragraph (e));
(f)        the USD Equivalent of the Outstanding Balance of any Unbilled Receivable which has not become a Billed Receivable within 40 days from its Purchase Date;
(g)          the USD Equivalent of any Obligor Overconcentration Amounts (without double counting the deduction with respect to the Outstanding Balance of Eligible Receivables and in this paragraph (g));
(h)        the Currency Reserve (without double counting the deduction with respect to the Outstanding Balance of Eligible Receivables and in this paragraph (h));
(i)           the USD Equivalent of the Country Overconcentration Amount (without double counting the deduction with respect to the Outstanding Balance of Eligible Receivables and this paragraph (i));
(j)           the USD Equivalent of the Country Credit Rating Overconcentration Amount (without double counting (i) the deduction with respect to the Outstanding Balance of Eligible Receivables and this paragraph (j) and (ii) any amounts deducted in respect of the Country Overconcentration Amount under (i) of this definition); and

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(k)          the USD Equivalent of the Unbilled Receivables Overconcentration Amount (without double counting (i) the deduction with respect to the Outstanding Balance of Eligible Receivables and this paragraph (k) and (ii) any amount deducted in respect of (g), (i) or (j) above).
“ Eligible Receivables ” means the Receivables that satisfy each of the Eligibility Criteria.
“ Encumbrance ” includes any mortgage, charge, pledge, lien, hypothecation or other encumbrance or other security interest of any kind securing any obligation of any Person or any other type of agreement, trust or arrangement (including, title transfer and retention arrangements) or right of set off or analogous right having a similar effect.
“ Enforcement Notice ” means a written notice from the Styron Security Trustee (acting on the instructions of the Secured Creditors) to the Master Purchaser following the occurrence, and during the continuance, of an Event of Default (after giving effect to any applicable grace period and after consulting with the Instructing Party) declaring the whole of the Security enforceable.
“ ERISA ” means the United States Employee Retirement Income Security Act of 1974, as amended, and any successor statute of similar import, together with the regulations thereunder, in each case as in effect from time to time.  References to sections of ERISA also refer to any successor sections.
“ ERISA Affiliate ” means a corporation, trade or business that is, along with a Seller, a member of a controlled group of corporations or a controlled group of trades or businesses, as described in section 414(b), (c), (m) or (o) of the IRC or section 4001(b) of ERISA.
“ Estimated Senior Costs Amount ” means the amounts which are expected to become due and payable on the next Monthly Payment Date pursuant to items first to seventh of the Pre-Enforcement Payments Priorities.
“ EUR Equivalent ” means, as of any date, the amount obtained by applying the rate for converting the relevant currency into EUR:
(a)          in the case of the Swiss Servicers’ Monthly Report, such rate as the Swiss Servicer shall reasonably determine as at 9am in London on the final Business Day of the most recent Determination Period; and
(b)          in the case of the Swiss Servicers’ Daily Report, the Spot Rate of exchange for that currency as at 9am in London on the preceding Business Day as notified by the Cash Manager to the Sellers on such Business Day.
“ EUR Proportion ” means, in respect of an amount, the EUR Equivalent of that amount multiplied by the fraction the numerator of which is the USD Equivalent of the aggregate Outstanding Balance of all Purchased Receivables not denominated in US Dollars and the denominator of which is the aggregate Outstanding Balance of all Purchased Receivables (calculated using the USD Equivalent of the Outstanding Balance not denominated in US Dollars).
“ Event of Default ” means an event of default as set out in Schedule 8 of this Deed.

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“ Excluded Obligor” means any Goodyear Company and any other Obligor which a Seller nominates (or has since 17 August 2010 nominated and not since notified the Master Purchaser otherwise) as an Excluded Obligor by providing 10 days’ written notice to the Master Purchaser and the Cash Manager provided that the relevant Seller may, on 10 days’ written notice specify that any Obligor that is then an Excluded Obligor is, from the expiry of such notice, no longer an Excluded Obligor.
“ Excluded Receivables ” means (i) Receivables originated by a Seller in respect of which the Obligor is an Excluded Obligor and (ii) any German Receivables which do not meet the Core Eligibility Criteria.
“ Expenses ” means:
(a)          in respect of the Closing Date, subject to any agreed caps, the reasonable expenses incurred or to be incurred by the Master Purchaser in connection with the purchase of the Receivables pursuant to the Swiss Receivables Purchase Agreement and the issue of Notes on or about such date, including the properly incurred fees payable to the Styron Security Trustee and the properly incurred fees payable in respect of legal counsel to the Instructing Party and the Styron Security Trustee;
(b)          in respect of the German Closing Date, subject to any agreed caps, the reasonable expenses incurred or to be incurred by the Master Purchaser in connection with the purchase of the Receivables pursuant to the German Receivables Purchase Agreement and the issue of Notes on or about such date, including the properly incurred fees payable to the Styron Security Trustee and the properly incurred fees payable in respect of legal counsel to the Instructing Party and the Styron Security Trustee;
(c)          in respect of the Dutch Closing Date, subject to any agreed caps, the reasonable expenses incurred or to be incurred by the Master Purchaser in connection with the purchase of the Receivables pursuant to the Dutch Receivables Purchase Agreement and the issue of Notes on or about such date, including the properly incurred fees payable to the Styron Security Trustee and the properly incurred fees payable in respect of legal counsel to the Instructing Party and the Styron Security Trustee;
(d)          in respect of the U.S. Closing Date, subject to any agreed caps, the reasonable expenses incurred or to be incurred by the Master Purchaser in connection with the purchase of the Receivables pursuant to the U.S. Intermediate Transfer Agreement and the issue of Notes on or about such date, including the properly incurred fees payable to the Styron Security Trustee and the properly incurred fees payable in respect of legal counsel to the Instructing Party and the Styron Security Trustee;
(e)        in respect of each Determination Period, the reasonable expenses incurred or to be incurred by the Master Purchaser in connection with the purchase of the Receivables pursuant to the Master Receivables Purchase Agreement and the issue of Notes on or about such date and the properly incurred fees payable to the Styron Security Trustee and the properly incurred fees payable in respect of legal counsel to the Instructing Party and the Styron Security Trustee;

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(f)        any taxes due and payable by the Master Purchaser in connection with the purchase of Receivables pursuant to the Master Receivables Purchase Agreement and the issue of the Notes;
(g)          all reasonable fees, costs and expenses to be incurred in the winding-up of the Master Purchaser; and
(h)          in respect of sub-clause 15.1.2(b) ( Post-Enforcement Payments Priorities ) of the Styron Security Deed only, an amount to be paid to the Collection Account Bank equal to all debit balances on the Pledged Accounts (as defined in the Styron Germany Account Pledge Agreement, German Account Pledge Agreement and the Trinseo Export German Account Pledge Agreement) which might result from re-debits following returned collection orders from cheques or direct debits or from incorrect bank transfers insofar as they relate to Collections in connection with the Pledged Accounts as defined in the Styron Germany Account Pledge Agreement, the German Account Pledge Agreement and the Trinseo Export German Account Pledge Agreement.
“ Facility Limit ” means USD 150,000,000.
“ FATCA ” means IRC Sections 1471 through 1474, as of the Dutch Closing Date (or any amended or successor version that is substantively comparable and any current or future regulations or official interpretations thereof and any agreements entered into pursuant to Section 1471(b)(1) of the IRC.
“ Fee Letter ” means:
(a) for the period up to but excluding the 2017 Amendment Date, the fee letter dated on or around the Dutch Closing Date between, among others, the Sellers, the Master Purchaser and the Regency Noteholder; and
(b) for the period from and including the 2017 Amendment Date, the fee letter dated on or around the 2017 Amendment Date between, among others, the Sellers, the Parent, the Master Purchaser and the Regency Noteholder.
“ Final Discharge Date ” means the date on which the Styron Security Trustee notifies the Master Purchaser and the Secured Creditors that it is satisfied that all the Secured Amounts and all other moneys and other liabilities (whether actual or contingent) due or owing by the Master Purchaser have been paid and discharged in full.
“ Final Legal Maturity Date ” means 28 May 2019.
“ First Offer Date ” means the date on which the Initial Note Issue Notice is served pursuant to the Variable Loan Note Issuance Deed.
“ Floating Charge ” means the floating charge created by the Master Purchaser in favour of the Styron Security Trustee pursuant to Clause 5 ( Creation of Floating Charge ) of the Styron Security Deed.
“ Force Majeure Event ” means an event beyond the reasonable control of the person affected including strike, lock-out, sit-in, labour dispute, act of God, war, insurrection, riot, epidemic, civil commotion, governmental directions and regulations, malicious

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damage, accident, breakdown of plant or machinery, computer software, hardware or system failure, earthquake, fire, flood, storm and other circumstances affecting the supply of goods or services.
“ Framework Deed ” and “ Master Definitions and Framework Deed ” means this Deed.
“ Framework Provisions ” means the provisions set out in clauses 3 to 8 and 11 to 25 of the Framework Deed.
“ Funding Agreement ” means the agreement dated 12 December 1997, as amended and restated on 21 September 2005 between, among others, the Regency Noteholder and Deutsche International Corporate Services (Ireland) Limited.
“ GAAP ” means, with respect to any Person, generally accepted accounting principles applicable to such Person (including generally accepted accounting principles applicable to such Person by law) or the consolidated group of which such Person is a member, as such principles may change from time to time.
“ German Closing Date ” has the meaning given to it in the German Receivables Purchase Agreement.
“ German Account Pledge Agreement ” means the Account Pledge Agreement executed by the Current Swiss Seller, the Master Purchaser and the Styron Security Trustee with respect to the Collection Accounts of the Current Swiss Seller dated 17 August 2010.
“ German Collection Accounts ” means the Collection Accounts owned by the German Seller, which receive Collections related to the German Purchased Receivables sold by the German Seller to the Master Purchaser pursuant to the German Receivables Purchase Agreement.
“ German Funding Date ” means the day falling one Business Day after the day the first Offer is delivered under the German Receivables Purchase Agreement or such other date as may be agreed by the German Seller and the Cash Manager.
“ German Purchase Rate ” means 99%.
“ German Purchased Receivables ” means the Receivables purchased by the Master Purchaser, including for the avoidance of doubt the Receivables purchased under Clause 10.2 ( Further Assurances ) of the German Receivables Purchase Agreement, on the terms of the German Receivables Purchase Agreement.
“ German Receivables ” means Receivables originated by the German Seller.
“ German Receivables Purchase Agreement ” means the German receivables purchase agreement dated 24 May 2011, as amended and restated on or around the Dutch Closing Date between the German Seller, the Current Swiss Seller, the Investment Manager, the Master Purchaser and the Styron Security Trustee.

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“ German Security Assignment and Trust Agreement ” means the agreement so named dated on or about the German Closing Date between the Master Purchaser, the Styron Security Trustee, the Regency Noteholder and the Styron Noteholder.
“ German Seller ” means Trinseo Deutschland Anlagengesellschaft mbH (formerly Styron Deutschland Anlagengesellschaft mbH), incorporated in Germany, in its capacity as seller of Receivables to the Master Purchaser under the German Receivables Purchase Agreement.
“ German Seller Credit and Collection Procedures ” means the Seller’s Credit and Collection Procedures with respect to the German Seller.
“ German Servicer ” means the person appointed by the Master Purchaser under the German Servicing Agreement to manage and provide administration and collection services in relation to the Purchased Receivables purchased by the Master Purchaser pursuant to the German Receivables Purchase Agreement.
“ German Servicer Default ” means the occurrence of any of the events described in Schedule 2 hereto as if each reference therein to “Swiss Servicer” was a reference to “German Servicer”, each reference to “Swiss Receivables Purchase Agreement” was a reference to “German Receivables Purchase Agreement” and each reference to “Swiss Servicing Agreement” was a reference to “German Servicing Agreement”.
“ German Servicer’s Daily Report ” means any document prepared by the German Servicer in accordance with Clause 7.2 ( German Servicer’s Daily Reports ) of the German Servicing Agreement, provided that all data required to be included in the German Servicer’s Daily Report shall be consolidated in the Swiss Servicers’ Daily Report.
“ German Servicer’s Monthly Report ” means any document prepared by the German Servicer in accordance with Clause 7.1 ( German Servicer’s Monthly Reports ) of the German Servicing Agreement provided that all data required to be included in the German Servicer’s Monthly Report shall be consolidated in the Swiss Servicers’ Monthly Report.
“ German Servicing Agreement ” means the German Servicing Agreement dated 14 May 2011, as amended and restated on or around the Dutch Closing Date, relating to the German Purchased Receivables between the Master Purchaser, the German Servicer and the Styron Security Trustee relating to the German Purchased Receivables.
“ German VAT Rate ” means the applicable rate of VAT as set out in the German VAT Act ( Umsatzsteuergesetz ).
“ Goodyear Company ” means any of:
(a)       Debica S.A. Tyre Company T.C.;
(b)         Goodyear Canada Inc.;
(c)       Goodyear Dalian Tire Co Ltd;
(d)       Goodyear De Chile A I C;

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(e)        Goodyear Dunlop Tires Operations S.A.;
(f)           Goodyear SA (pty) Ltd;
(g)        Goodyear (Thailand) Public Company Limited;
(h)        The Goodyear Tire and Rubber Company; and
(i)         Goodyear Lastikleri T.A.S.
“ Governmental Authority ” means the government of any jurisdiction, or any political subdivision thereof, whether provincial, state or local, and any department, ministry, agency, instrumentality, authority, body, court, central bank or other entity lawfully exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.
“ Guarantee Event ” has the meaning given to it in the Guarantee Agreement.
“ Guarantee Agreement ” means the agreement dated 12 August 2010, as amended and restated on 24 May 2011, 30 May 2013 and on the 2016 Amendment Effective Date to which the Guarantor, the Styron Security Trustee, the Master Purchaser and Regency Noteholder are party.
“ Guarantor ” means the Parent, as guarantor, under the Guarantee Agreement.
“ Guarantor Covenants ” means the covenants made by the Guarantor contained in Schedule 2 ( Covenants ) of the Guarantee Agreement.
“ Guarantor Warranties ” means the warranties made by the Guarantor contained in Schedule 1 ( Representations and Warranties ) of the Guarantee Agreement.
“ Guidelines ” means:
(a)        guideline S-02.123 in relation to interbank loans of 22 September 1986 ( Merkblatt S-02-.123 vom 22 September 1986 betreffend Zinsen von Bankguthaben, deren Gläubiger Banken sind (Interbankguthaben) );
(b)        guideline S-02.132 in relation to issuance stamp duty on fixed deposits of 1 April 1993 ( Merkblatt S-02.132 vom 1. April 1993 betreffend Emissionsabgabe auf Festgeldanlagen bei inländischen Banken );
(c)        guideline S-02.130.1 in relation to accounts receivables of Swiss debtors of April 1999 ( Merkblatt S-02.130.1 vom April 1999 Geldmarktpapiere und Buchforderungen inländischer Schuldner );
(d)        guideline S-02.122.1 in relation to bonds of April 1999 ( Merkblatt S-02.122.1 vom April 1999 betreffend Obligationen );
(e)        guideline S-02.122.2 in relation to customer credit balances of April 1999 ( Merkblatt S-02.122.2 vom April 1999 betreffend Kundenguthaben );

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(f)        guideline S-02.128 in relation to syndicated credit facilities of January 2000 ( Merkblatt S-02.128 vom Januar 2000 Steuerliche Behandlung von Konsortialdarlehen, Schuldscheindarlehen, Wechseln und Unterbeteiligungen ); and
(g)          circular letter No. 15 in relation to bonds and derivatives of 7 February 2007 ( Kreisschreiben Nr. 15 vom 7. Februar 2007 betreffend Obligationen und derivative Finanzinstrumente als Gegenstand der direkten Bundessteuer, der Verrechnungssteuer sowie der Stempelabgaben ),
each as issued, amended or substituted from time to time.
“ Haulage Company ” means any company or other person employed by a Seller to deliver chemical products to Obligors.
“ Holder ” means the person registered in the Register maintained by the Registrar in relation to a Note as the duly registered holder of such Note or, if more than one person is so registered, the first-named of such persons.
“ Initial Conditions Precedent ” means the conditions set out in Schedule 9 ( Initial Conditions Precedent ), which are applicable to the Closing Date.
“ Initial Note Issue Notice ” means a notice of an Initial Offer delivered by the Master Purchaser to each Noteholder in accordance with Clause 4.1 ( Initial Offer ) of the Variable Loan Note Issuance Deed.
“ Initial Noteholders ” means the initial Regency Noteholder and the initial Styron Noteholder.
“ Initial Offer ” means each initial offer by the Master Purchaser in accordance with Clause 5.1 ( Initial Offer ) of the Variable Loan Note Issuance Deed.
“ Initial Principal Amount ” means, in relation to any Note, the Principal Amount Outstanding of such Note on the Swiss Funding Date.
“ Initial Purchase Price ” has the meaning specified in clause 3.1(a) of the Swiss Master Receivables Purchase Agreement, clause 3.1 of the Dutch Receivables Purchase Agreement or clause 3.1 of the U.S. Intermediate Transfer Agreement (as applicable) (or, in the case of the German Receivables Purchase Agreement or the U.S. Receivables Purchase Agreement, as applicable, the meaning given to the term “ Purchase Price ”).
“ Initial Purchase Price Payment Request ” means a request made by a Seller pursuant to Clause 3.3(d) ( Initial Purchase Price Payment Request ) of the Swiss Master Receivables Purchase Agreement, Clause 3.2(d) ( Purchase Price Payment Request ) of the German Receivables Purchase Agreement, Clause 3.2(d) ( Purchase Price ) of the Dutch Receivables Purchase Agreement or Clause 3.2(d) ( Purchase Price Payment Request ) of the U.S. Intermediate Transfer Agreement (as applicable);
“ Initial Subscription Price ” means the amount which a Noteholder is required to pay for each $1 or €1 in Initial Principal Amount of the relevant Notes as specified in the relevant Initial Offer.

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“ Insolvency Act ” means the Insolvency Act 1986.
“ Insolvency Event ” in respect of a company means:
(a)          such company is unable or admits its inability to pay its debts as they fall due (after taking into account any grace period or permitted deferral), or suspends making payments on any of its debts; or
(b)          such company is (or is deemed to be) unable to pay its debts as they fall due within the meaning of Section 214 of the Irish Companies Act 1963 or Section 2(3) of the Irish Companies Amendment (Act) 1990; or
(c)        a moratorium is declared in respect of any indebtedness of such company; or
(d)          the value of the assets of such company falls to less than the amount of its liabilities; or
(e)          such company otherwise becomes insolvent; or
(f)        the commencement of negotiations with one or more creditors of such company with a view to rescheduling any indebtedness of such company other than in connection with an refinancing in the ordinary course of business; or
(g)          any corporate action, legal proceedings or other procedure or step is taken in relation to:
(i)           the appointment of an Insolvency Official in relation to such company or in relation to the whole or any part of the undertaking or assets of such company except, in the case of the Regency Noteholder, the application to the Court under paragraph 12 or the filing of notice of intention to appoint an administrator under paragraph 26 of Schedule B1 to the Insolvency Act by the Master Purchaser or its directors, or the appointment or an administrative receiver by the Styron Security Trustee following any such application or notice; or
(ii)       an encumbrancer (excluding, in relation to the Master Purchaser, the Styron Security Trustee or any Receiver) taking possession of the whole or in the opinion of the Styron Security Trustee any substantial part of the undertaking or assets of such company; or
(iii)      the making of an arrangement, composition or compromise (whether by way of voluntary arrangement, scheme of arrangement or otherwise) with any creditor of such company, a conveyance to or assignment for the creditors of such company generally or the making of an application to a court of competent jurisdiction for protection from the creditors of such company generally other than in connection with any refinancing in the ordinary course of business; or
(iv)         any distress, execution, attachment or other process being levied or enforced or enforced or imposed upon or against the whole or any part of the undertaking or assets of such company (excluding, in relation to

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the Master Purchaser, by the Styron Security Trustee or any Receiver); or
(h)        any procedure or step is taken, or any event occurs, analogous to those set out in (a) to (f) above, in any jurisdiction.
“ Insolvency Law ” means law relating to bankruptcy, insolvency, administration, receivership, examination, administrative receivership, reorganization, winding up or composition, moratorium or adjustment of debts or the rights of creditors generally (whether by way of voluntary arrangement or otherwise).  For the avoidance of doubt, the term “Insolvency Law” shall include the Insolvency Regulation.
“ Insolvency Official ” means, a liquidator, provisional liquidator, administrator, administrative receiver, examiner, receiver, receiver or manager, compulsory or interim manager, nominee, supervisor, trustee, conservator, guardian or other similar officer in respect of such company or in respect of any arrangement, compromise or composition with any creditors or any equivalent or analogous officer under the law of any jurisdiction.
“ Insolvency Regulation ” means the Council Regulation (EC) No. 1346/2000 of 29 May 2000 on insolvency proceedings.
“ Instructing Party ” means (i) the Regency Noteholder or (ii) if the Styron Noteholder and Regency Assets Designated Activity Company confirm to the Styron Security Trustee in writing that there are no Regency Notes outstanding and the Regency Noteholder has no further obligations to subscribe for further Notes, such other person as the Secured Creditors (other than the Styron Security Trustee) shall unanimously agree and notify to the Styron Security Trustee.
“ Interest Period ” means each period from (and including) a Monthly Payment Date (or the Swiss Funding Date) to (but excluding) the next (or first) Monthly Payment Date.
“ Investment Manager ” means the person appointed by the Sellers to accept the Purchase Price with respect to Purchased Receivables on their behalf and to perform various other services related to the collection and distribution of such funds, being Styfco at the U.S. Closing Date.
“ Investment Manager Operating Accounts ” means the following accounts:
(a)       in respect of euro:

Account Name:	Trinseo Finance Luxembourg SARL Swiss Branch	
Bank:	Deutsche Bank AG, Frankfurt, Germany	
SWIFT:	DEUTDEFF	
IBAN:	 	
a/c Number:	 	
 
(b)       in respect of US Dollar:

Account Name:	Trinseo Finance Luxembourg SARL Swiss Branch	
Bank:	Deutsche Bank AG, Frankfurt, Germany	

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SWIFT:	DEUTDEFF	
IBAN:	 	
a/c:	 	
 
or such other account or account of the Investment Manager with a bank as may, following 10 Business Days’ prior written notification to the Master Purchaser, the Styron Security Trustee and the Cash Manager, be utilised for the time being for the purposes of payment to any Seller of amounts due and payable to it under the relevant Master Receivables Purchase Agreement.
“ Invoice ” means the account for payment sent by or on behalf of a Seller to an Obligor specifying the goods supplied, the amount due to be paid in respect thereof by the Obligor including any VAT chargeable in respect of those goods and the due date for such payment.
“ IRC ” means the U.S. Internal Revenue Code of 1986, as amended, and the regulations promulgated thereunder.
“ Large Obligor ” means an Obligor in respect of which:
(a)          the Outstanding Balance of Purchased Receivables relating to such Obligor which are Delinquent Receivables constitute at least 5% of the aggregate Outstanding Balance of all Purchased Receivables; or
(b)          the Outstanding Balance of Purchased Receivables relating to such Obligor which are Defaulted Receivables constitute at least 5% of the aggregate Outstanding Balance of all Purchased Receivables.
“ Ledgers ” means the Distribution Ledgers and “ Ledger ” means any one of them.
“ Liabilities ” means, in respect of any person, any losses, damages, costs, charges, awards, claims, demands, expenses, judgments, actions, proceedings or other liabilities whatsoever including reasonable legal fees and any Taxes and penalties incurred by that person.
“ Liquidity Facility Agreement ” means the liquidity facility agreement dated on or about the 11 August 2010, as amended and restated on or about the Extension Date (as defined in the amendment deed to the Framework Deed dated on or around 4 February 2016) and the 2017 Amendment Effective Date, between the Regency Noteholder, the Liquidity Facility Provider and Deutsche International Corporate Services (Ireland) Limited.
“ Liquidity Facility Provider ” means HSBC Bank plc.
“ Loss and Dilution Reserve ” means, on any date, an amount equal to:
( LDRR x NERB )
where:

LDRR	=	the Loss and Dilution Reserve Ratio on such date; and	

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NERB	=	the Net Eligible Receivables Balance at the close of business of the Investment Manager on such date.	
 
“ Loss and Dilution Reserve Ratio ” means, on any date, the sum of:
(a)        the greater of (i) the Loss Reserve Floor and (ii) Loss Reserve Ratio; plus
(b)        the greater of (i) the Dilution Reserve Floor and (ii) Dilution Reserve Ratio.
“ Loss Horizon Ratio ” means, as of any Monthly Reporting Date, the sum of (i) the preceding five (5) months of aggregate sales divided by (ii) the Net Eligible Receivables Balance as at the end of the current Determination Period.
“ Loss Reserve Floor ” means 10%.
“ Loss Reserve Ratio ” means, as of any Monthly Reporting Date, a percentage calculated in accordance with the following formula:

LRR	=	LHR x AD x SF	
 	 	 	
where:	 	 	
 	 	 	
LRR	=	the Loss Reserve Ratio;	
 	 	 	
LHR	=	the Loss Horizon Ratio;	
 	 	 	
AD	=	the “Average Default”, defined as the highest three-month rolling average Default Ratio that occurred during the period of twelve (12) consecutive Monthly Periods immediately preceding such earlier Monthly Reporting Date; and	
 	 	 	
SF	=	the Applicable Stress Factor.	
 
“ LPA ” means the Law of Property Act 1925.
“ Mandate ” means the resolutions, instructions and signature authorities relating to the Master Purchaser Accounts in the form of the document set out in Schedule 1 to the Account Bank Agreement.
“ Master Purchaser ” means Styron Receivables Funding Designated Activity Company, a company registered in Ireland with registration number 486138, whose registered office is at 3 rd Floor, Kilmore House, Park Lane, Spencer Dock, Dublin 1, Ireland.
“ Master Purchaser Account Bank ” means HSBC Bank plc.
“ Master Purchaser Account Mandate ” means the resolutions, instructions and signature authorities relating to the Master Purchaser Account in the form of the document set out in Schedule 1 ( Master Purchaser Account Mandate ) of the Account Bank Agreement.

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“ Master Purchaser Accounts ” means the accounts so named with the Master Purchaser Account Bank (so long as it is an Eligible Institution) specified in the Account Details or such other account or accounts as may, with the prior written consent of the Styron Security Trustee, be designated by the Master Purchaser as such an account.
“ Master Purchaser Covenants ” means the covenants of the Master Purchaser set out in Schedule 7 of this Framework Deed.
“ Master Purchaser Enforcement Event ” means an Event of Default.
“ Master Purchaser EUR Account ” means the account so named with the Master Purchaser Account Bank (so long as it is an Eligible Institution) specified in the Account Details or such other account or accounts as may, with the prior written consent of the Styron Security Trustee, be designated by the Master Purchaser as such account.
“ Master Purchaser USD Account ” means the account so named with the Master Purchaser Account Bank (so long as it is an Eligible Institution) specified in the Account Details or such other account or accounts as may, with the prior written consent of the Styron Security Trustee, be designated by the Master Purchaser as such account.
“ Master Purchaser Receivables Power of Attorney ” means a power of attorney substantially in the form of Schedule 4 to a Master Receivables Purchase Agreement (or, with respect to the U.S. Receivables Purchase Agreement, Part B of Schedule 4 thereto).
“ Master Purchaser Security Document ” means the Styron Security Deed, the German Security Assignment and Trust Agreement and the U.S. Security Agreement.
“ Master Purchaser Warranties ” means the representations and warranties of the Master Purchaser set out in Schedule 7 of this Deed and “ Master Purchaser Warranty ” means any of them.
“ Master Receivables Purchase Agreement ” means the Swiss Receivables Purchase Agreement, the German Receivables Purchase Agreement, the Dutch Receivables Purchase Agreement, the U.S. Receivables Purchase Agreement, the U.S. Intermediate Transfer Agreement or any other master receivables purchase agreement to which a Seller, the Master Purchaser and the Styron Security Trustee are a party, as the context may require.
“ Material Adverse Effect ” means a material adverse effect on:
(a)        the collectability of the Receivables or any significant portion thereof,
(b)          the ability of a Seller, the Styron Noteholder, the Parent or a Servicer to perform any of its respective material obligations under the Transaction Documents to which it is a party,
(c)        the legality, validity or enforceability of the Transaction Documents (including, the validity, enforceability or priority of any of the Encumbrances granted

31

thereunder) or the rights of the Regency Noteholder, the Liquidity Facility Provider or the Styron Security Trustee under the Transaction Documents,
and for the avoidance of doubt, an event of default under the Credit Agreement (or any replacement credit agreement, notes of indebtedness or other debt issued from time to time) shall not constitute a Material Adverse Effect unless any of (a) to (c) are also applicable.
“ Minimum Long-term Rating ” means, in respect of any person, such person’s long term unsecured, unsubordinated, unguaranteed debt obligations being rated, in the case of Moody’s, “Aa3”, and in the case of S&P, “AA-”.
“ Minimum Short-term Rating ” means, in respect of any person, such person’s short term unsecured, unsubordinated, unguaranteed debt obligations being rated at least, in the case of Moody’s, “Prime-1”, and in the case of S&P, “A-1”.
“ Monthly Payment Date ” means 18 September 2010 and the 18th of each month thereafter or, if such day is not a Business Day, the next Business Day.
“ Monthly Payment Date Payments Priorities ” means the provisions relating to the order of priority of payments set out in Paragraph 11 ( Payments from Distribution Ledgers on a Monthly Payment Date ) of Part 5 ( Payments Priorities ) of Schedule 1 ( Services to be provided by the Cash Manager ) of the Cash Management Agreement.
“ Monthly Reporting Date ” means, in respect of each Determination Period, the twelfth Business Day of the month immediately following that Determination Period.
“ Moody’s ” means Moody’s Investors Service Limited or the successor to its rating business.
“ Net Eligible Receivables Balance ” means, as of any Determination Date, the amount equal to the Receivables Pool on such date less (a) outstanding balances of customer deposits which are not Collections, if any, (b) Unapplied Credits, in respect of any Eligible Receivables which are Purchased Receivables, if any, and (c) the Aggregate Obligor Overconcentration Amount on such Determination Date.
“ Non-Bank Rules ” means the Ten Non-Bank Rule and the Twenty Non-Bank Rule.
“Non-Conforming Receivable” has the meaning specified in clause 7.1 of the Master Receivables Purchase Agreement.
“ Non-Investment Grade Country ” means an Unrestricted Country or an Eligible Country that has a sovereign debt rating of less than “BBB-” from S&P or “Baa3” from Moody’s.
“ Normal Concentration Limit ” has the meaning set out in paragraph (u) of Schedule 3.
“ Note Certificates ” means the certificates evidencing the Notes.
“ Note Interest Rate ” means, in respect of any Monthly Payment Date, the interest rate applicable for the Interest Period ending on such Monthly Payment Date in respect of

32

a Note, as calculated by the Cash Manager on or prior to each Monthly Payment Date as being the sum of (i) the Note Refinancing Rate and (ii) the Usage Fee.
“ Note Principal Payment ” has the meaning given to it in Condition 3.
“ Note Proceeds ” means, in respect of the issue of the Notes or any increase in the Principal Amount Outstanding, the gross proceeds of such issue or increase.
“ Note Rate ” means the relevant Note Interest Rate.
“ Note Refinancing Rate ” means, in respect of any Payment Date, the rate determined from the following formula:
(a)        (A x B) + (C x D)
where
A         =          the CP Rate for the relevant Interest Period;
B          =         the fraction, expressed as a percentage, of (i) the principal amount of the Regency USD Note (if the relevant Note is denominated in Dollars) or Regency EUR Note (if the relevant Note is denominated in Euro), the purchasing and holding of which is funded through the commercial paper markets over (ii) the Regency USD Note Principal Amount Outstanding (if the relevant Note is denominated in Dollars) or Regency EUR Note Principal Amount Outstanding (if the relevant Note is denominated in Euro);
C          =         the Reuters Screen Rate for the relevant Interest Period; and
D         =          the fraction, expressed as a percentage, of (i) the principal amount of the Regency USD Note (if the relevant Note is denominated in Dollars) or Regency EUR Note (if the relevant Note is denominated in Euro), the purchasing and holding of which is funded by drawings under the Regency Liquidity Facility Agreement over (ii) the Regency USD Note Principal Amount Outstanding (if the relevant Note is denominated in Dollars) or Regency EUR Note Principal Amount Outstanding (if the relevant Note is denominated in Euro).
“ Noteholders ” means the Regency Noteholder and the Styron Noteholder.
“ Noteholder’s Account ” means the account of each Noteholder to which the Master Purchaser is to remit funds pursuant to the Variable Loan Note Issuance Deed as specified in the Account Details or as otherwise notified to the Master Purchaser and the Cash Manager.
“ Notes ” means the Regency Note and the Styron Note and “ Note ” means any of them.
“ Notices Condition ” means Condition 17 ( Notices ).
“ Notices Details ” means the provisions set out in Clause 8 ( Notices ) of this Deed.
“ Notification Event ” means a Perfection Event.

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“ Obligations ” means all of the obligations of the Master Purchaser created by or arising under the Notes and the Relevant Transaction Documents.
“ Obligor ” means a customer of a Seller who is party to a Contract relating to the supply of products giving rise to Receivables.
“ Obligor Limit ” means, as of any Determination Date with respect to each Obligor having an unsecured long-term debt rating (or equivalent shadow rating) from each of S&P and Moody’s, an amount equal to (a) the applicable percentage listed opposite such Obligor’s debt rating in the chart set forth below multiplied by (b) the Aggregate Receivables Balance as of the immediately preceding Business Day:

 	Long-Term Rating of
Obligor	Equivalent Short-
Term Rating	Applicable
Percentage	
S&P	AA- or higher	A-1	10%	
Moody’s	Aa3 or higher	P-1	10%	
S&P	BBB+ or higher (but lower than AA-)	A-2	7.5%	
Moody’s	Baa1 or higher (but lower than Aa3	P-2	7.5%	
S&P	BBB- or higher (but lower than BBB+)	A-3	5%	
Moody’s	Baa3 or higher (but lower than Baa1)	P-3	5%	
S&P	Lower than BBB- or Not Rated	Lower than A2 or Not Rated	3%	
Moody’s	Lower than Baa3 or Not Rated	Lower than P2 or Not Rated	3%	
 
For purposes of calculating the foregoing:
(a)          if an Obligor’s unsecured long-term debt rating (or equivalent shadow rating) results in different Obligor Limits (because of a difference in the long-term unsecured debt ratings assigned by each of S&P and Moody’s), the lower Obligor Limit shall be the Obligor Limit for such Obligor;
(b)          in the case of an Obligor which is affiliated with one or more other Obligors, the foregoing Obligor Limits shall be calculated as if such Obligor and such affiliated Obligors were one Obligor; and

34

(c)          an Obligor which does not have a long-term debt rating from S&P /or Moody’s but which has the equivalent short-term rating from such rating agency as described above shall be deemed to have the related long-term rating.
“ Obligor Overconcentration Amounts ” means, with respect to each Obligor as of any Determination Date, the aggregate amount by which the Outstanding Balance owed by each Obligor with respect to Eligible Receivables exceeds the applicable Obligor Limit as specified in the most recent Swiss Servicer’s Daily Report, provided that any Affiliates of an Obligor shall be treated as if they are one Obligor.
“ OFAC ” means the Office of Foreign Assets Control of the US Department of the Treasury.
“ Offer ” means a written offer in substantially the form set out in Schedule 5 to the relevant Master Receivables Purchase Agreement.
“ Outstanding Balance ” means, in relation to a particular Billed Receivable on a particular date, the total balance of the amounts outstanding thereunder, including any amounts in respect of Value Added Tax, and in relation to a particular Unbilled Receivable, means an amount equal to the Post Goods Issued Value of the product in question excluding any amounts in respect of any applicable Value Added Tax.
“ Parent ” means (a)    Trinseo Holding S.à r.l., a Luxembourg private limited liability company (société à responsabilité limitée) with registered office at 46A avenue John F. Kennedy, L-1855 Luxembourg, Grand Duchy of Luxembourg, registered with the Luxembourg Register of Commerce and Companies under number B 153.582 and having a share capital of US$ 162,815,834.12.
“ Parent’s Quarterly LE Accounts ” means the consolidated quarterly management accounts prepared by the Parent in the form required by the Credit Agreement as of the Closing Date or such other form as may be consented to by the Instructing Party.
“ PATRIOT Act ” means the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Public Law 107-56.
“ Payments Priorities ” means the Post-Enforcement Payments Priorities and the Pre- Enforcement Payments Priorities.
“ Perfection Event ” means the occurrence of any of the events set out in Part B of Schedule 1.
“ Person ” means an individual, firm, partnership, corporation (including a business trust), company (including a limited liability company or a joint stock company), consortium, trust, unincorporated association, joint venture or other entity, or a government or state or any political subdivision or agency thereof.
“ Plan ” means any employee pension benefit plan (other than a multiemployer plan as defined in section 4001(a)(3) of ERISA) subject to the provisions of Title IV of ERISA or section 412 of the IRC and in respect of which the U.S. Seller, the U.S. Intermediate Transferor or any ERISA Affiliate is (or, if such plan were terminated, would under

35

section 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.
“ Post-Enforcement Payments Priorities ” means the provisions relating to the order of priority of payments from the Master Purchaser Account set out in Clause 15 ( Post Enforcement Payments Priorities ) of the Styron Security Deed.
“ Post Goods Issued Value ” means the product of (i) the aggregate cost of the material used in the production of the product in question and (ii) 85%.
“ Potential Dutch Servicer Default ” means an event that but for the giving of notice or lapse of time or both would constitute a Dutch Servicer Default.
“ Potential Event of Default ” means any event which would become (with the passage of time, the giving of notice, the making of any determination or any combination thereof) an Event of Default.
“ Potential German Servicer Default ” means an event that but for the giving of notice or lapse of time or both would constitute a German Servicer Default.
“ Potential Swiss Servicer Default ” means an event that but for the giving of notice or lapse of time or both would constitute a Swiss Servicer Default.
“ Potential Termination Event ” means an event that but for the notice or lapse of time or both would constitute a Termination Event.
“ Potential U.S. Servicer Default ” means an event that but for the giving of notice or lapse of time or both would constitute a U.S. Servicer Default.
“ Pre-Enforcement Payments Priorities ” means the Settlement Date Payments Priorities and the Monthly Payment Date Payments Priorities.
“ Prepayment ” has the meaning given in Condition 9.2 of the Notes.
“ Principal Amount Outstanding ” means the Regency USD Note Principal Amount Outstanding, the Regency EUR Note Principal Amount Outstanding, the Styron USD Note Principal Amount Outstanding or the Styron EUR Note Principal Amount Outstanding, as the case may be.
“ Programme Termination Date ” means the earliest to occur of: (a) the Final Legal Maturity Date, (b) the date on which a Perfection Event in clause (b) in Part B of Schedule 1 occurs and (c) the date, following a Termination Event, that the Master Purchaser, acting on the instructions of the Instructing Party, notifies the Sellers that it is the Programme Termination Date.
“ Purchase Base ” means the Purchase Rate multiplied by the Eligible Pool Balance specified in the Swiss Servicers’ Daily Report (as may be adjusted in accordance with Clause 4.3(q)(vi) of the German Receivables Purchase Agreement).
“ Purchase Date ” means, in respect of a Receivable and its Related Rights, the date such Receivable is accepted by the Master Purchaser pursuant to the relevant Master Receivables Purchase Agreement or, in the case of a sale of Receivables by the U.S.

36

Seller to the U.S. Intermediate Transferor, the date such Receivable is sold or contributed to the U.S. Intermediate Transferor pursuant to the U.S. Receivables Purchase Agreement.
“ Purchase Price ” means, (i) in respect of each Purchased Receivable other than when used in connection with the U.S. Receivables Purchase Agreement, the Initial Purchase Price plus the Deferred Purchase Price (if applicable), and (ii) when used in respect of each Purchased Receivable in connection with the U.S. Receivables Purchase Agreement, has the meaning specified in the U.S. Receivables Purchase Agreement.
“ Purchase Rate ” means:
(a)          prior to 1 January 2015, 1 less the fraction the numerator of which is the Total Reserves and the denominator of which is the Net Eligible Receivables Balance; and
(b)          on and after 1 January 2015, 1 less the higher of: (i) the fraction the numerator of which is the Total Reserves and the denominator of which is the Net Eligible Receivables Balance; and (ii) 0.05.
“ Purchased Receivable ” means any Receivable which has been purchased by the Master Purchaser or purchased by or contributed to the U.S. Intermediate Transferor, as applicable, pursuant to a Master Receivables Purchase Agreement, which remains outstanding and which has not been repurchased by the relevant Seller pursuant to the relevant Master Receivables Purchase Agreement.
“ Qualifying Bank ” means a person or entity which effectively conducts banking activities with its own infrastructure and staff as its principal purpose and which has a banking license in full force and effect issued in accordance with the banking laws in force in its jurisdiction of incorporation, or if acting through a branch, issued in accordance with the banking laws in the jurisdiction of such branch, all in accordance with the Guidelines.
“ Qualifying Investor ” means a person which is beneficially entitled to interest payable to that person in respect of a Note and is (a) a person who is, by virtue of the law of a Qualifying Jurisdiction, resident for the purposes of tax in the Qualifying Jurisdiction except, in a case where the person is a body corporate, where interest payable to that person in respect of a Note is paid in connection with a trade or business which is carried on in Ireland by that body corporate through a branch or agency or (b) a qualifying company (within the meaning of section 110 of the Taxes Consolidation Act of Ireland 1997).
“ Qualifying Jurisdiction ” means:
(a)        a member state of the European Communities other than Ireland;
(b)        the United Kingdom;
(c)        a jurisdiction with which Ireland has entered into a Tax Treaty that has the force of law; or

37

(d)        a jurisdiction with which Ireland has entered into a Tax Treaty where that Tax Treaty will (on completion of necessary procedures) have the force of law.
“ Rating Agencies ” means Moody’s and S&P as applicable.
“ Receivable ” means in respect of a Seller, each amount payable (or which will, upon delivery of the relevant Invoice, or delivery of the relevant chemical products, become payable) by an Obligor for chemical products supplied or to be supplied by the relevant Seller pursuant to a Contract and all rights to, or to demand, sue for, recover, receive and give receipts for payment of any such amount or any invoice and the proceeds of payment.
“ Receivables Pool ” or “ Pool Receivables ” means the aggregate Outstanding Balances of all Purchased Receivables at any time.
“ Receivables Warranties ” means the representations and warranties set out in Part B of Schedule 1 to the Master Receivables Purchase Agreement.
“ Receiver ” means a receiver appointed by the Styron Security Trustee pursuant to clause 18 of the Styron Security Deed.
“ Regency Commitment Fee ” means the fee specified as such in the Fee Letter.
“ Regency EUR Note ” means the EUR denominated note issued by the Master Purchaser to the Regency Noteholder pursuant to the Variable Loan Note Issuance Deed.
“ Regency EUR Note Additional Principal Amount ” means the greater of (i) zero and (ii) the EUR Proportion of the Regency Percentage of the Purchase Base specified in the Swiss Servicers’ Daily Report delivered three Business Days prior to the relevant Roll Date or, if applicable, on the relevant Reporting Date on which a Seller makes a request pursuant to Clause 6.1.2 or 6.1.3 of the Variable Loan Note Issuance Deed less the Principal Amount Outstanding of the Regency EUR Note immediately prior to the relevant Roll Date.
“ Regency EUR Note Initial Principal Amount ” means the EUR Proportion of the Regency Percentage of the Purchase Base specified in the first Current Swiss Servicer’s Daily Report delivered by the Current Swiss Servicer.
“ Regency EUR Note Principal Amount Outstanding ” means:
(a)        on the Swiss Funding Date, the Regency EUR Note Initial Principal Amount; and
(b)        on any day following the Swiss Funding Date, the Regency EUR Note Principal Amount Outstanding as at the end of the immediately preceding day:
(i)           plus (if such day is a Settlement Date), the amount of any Regency EUR Note Additional Principal Amount paid by the Regency Noteholder on such day; and

38

(ii)       minus (if such day is a Roll Date) the Regency EUR Note Redemption Amount paid to the Regency Noteholder on such day.
“ Regency EUR Note Redemption Amount ” means:
(a)        prior to the occurrence of a Termination Event that is continuing, the greater of (i) zero and (ii) the Principal Amount Outstanding of the Regency EUR Note immediately prior to the relevant Roll Date less the EUR Proportion of the Regency Percentage of the Purchase Base specified in the Swiss Servicers’ Daily Report delivered three Business Days prior to the relevant Roll Date; and
(b)          following the occurrence of a Termination Event that is continuing, the EUR Proportion of the Regency Percentage of the balance stood to the credit of the Master Purchaser Accounts following payment of items first to seventh in the Pre-Enforcement Payments Priorities on the relevant Monthly Payment Date.
“ Regency Note Interest Amount ” means, in respect of any Monthly Payment Date, in respect of a Regency Note, the aggregate of the results of the following formula being applied in respect of each $1 or €1 of Principal Amount Outstanding of the relevant Regency Note that was outstanding at any point during the relevant Interest Period (rounded to the nearest eurocent, half a eurocent being rounded up):
( ( A / 360 ) x ( B x C ) )
where

A	=	the exact number of days during the relevant Interest Period that such $1 or €1 of Principal Amount Outstanding was outstanding;	
 	 	 	
B	=	such $1 or €1 of Principal Amount Outstanding of the relevant Regency Note, as the case may be; and	
 	 	 	
C	=	the relevant Note Interest Rate;	
 
plus any part of the Regency Note Interest Amount in respect of the immediately preceding Monthly Payment Date not paid on such immediately preceding Monthly Payment Date, plus the amount of Default Interest due on such unpaid amount.
“ Regency Noteholder ” means the holder for the time being of the Regency Note.
“ Regency Note Redemption Amount ” means the Regency EUR Note Redemption Amount or the Regency USD Note Redemption Amount as applicable.
“ Regency Noteholder Related Debt ” means any notes or other securities or instruments issued or any other debt incurred by the Regency Noteholder (including any liquidity facility agreement or credit support agreement) or any hedging agreement entered into by the Regency Noteholder in connection with the funding provided or to be provided pursuant to the Variable Loan Note Issuance Deed.
“ Regency Notes ” means the Regency USD Note and the Regency EUR Note.

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“ Regency Percentage ” means:
(a)        in respect of the Regency EUR Note, 100% minus the Styron Percentage for the Styron EUR Note;
(b)        in respect of the Regency USD Note, 100% minus the Styron Percentage for the Styron USD Note; or
(c)        if in respect of both the Regency EUR Note and the Regency USD Note, the weighted average (by reference to the principal amount of each Note) of the percentages in (a) and (b) above.
“ Regency USD Note ” means the US Dollar denominated note issued by the Master Purchaser to the Regency Noteholder pursuant to the Variable Loan Note Issuance Deed.
“ Regency USD Note Additional Principal Amount ” means the greater of (i) zero and (ii) the USD Proportion of the Regency Percentage of the Purchase Base specified in the Swiss Sellers’ Daily Report delivered three Business Days prior to the relevant Roll Date or, if applicable, on the relevant Reporting Date on which a Seller makes a request pursuant to Clause 6.1.2 or 6.1.3 of the Variable Loan Note Issuance Deed less the Principal Amount Outstanding of the Regency USD Note immediately prior to the relevant Roll Date.
“ Regency USD Note Initial Principal Amount ” means the USD Proportion of the Regency Percentage of the Purchase Base specified in the first Current Swiss Seller’s Daily Report delivered by the Current Swiss Seller.
“ Regency USD Note Principal Amount Outstanding ” means:
(a)        on the Swiss Funding Date, the Regency USD Note Initial Principal Amount Outstanding; and
(b)        on any day following the Swiss Funding Date, the Regency USD Note Principal Amount Outstanding as at the end of the immediately preceding day:
(i)           plus (if such day is a Settlement Date), the amount of any Regency USD Note Additional Principal Amount paid by the Regency Noteholder on such day; and
(ii)       minus (if such day is a Roll Date) the Regency USD Note Redemption Amount paid to the Regency Noteholder on such day.
“ Regency USD Note Redemption Amount ” means:
(a)          prior to the occurrence of a Termination Event that is continuing, the greater of (i) zero and (ii) the Principal Amount Outstanding of the Regency USD Note immediately prior to the relevant Roll Date less the USD Proportion of the Regency Percentage of the Purchase Base specified in the Swiss Sellers’ Daily Report delivered three Business Days prior to the relevant Roll Date; and
(b)        following the occurrence of a Termination Event that is continuing, the USD Proportion of the Regency Percentage of the balance stood to the credit of the

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Master Purchaser Accounts following payment of items first to seventh in the Pre-Enforcement Payments Priorities on the relevant Monthly Payment Date.
“ Register ” means the register maintained by the Registrar pursuant to the Variable Loan Note Issuance Deed.
“ Registrar ” means TMF Administration Services Limited.
“ Regulatory Direction ” means, in relation to any person, a direction or requirement of any Governmental Authority with whose directions or requirements such person is accustomed to comply.
“ Related Contract Rights ” means, in relation to a Receivable, any rights (including rights of retention of title) under or relating to the Contract to which such Receivable relates.
“ Related Rights ” has the meaning given in clause 2.1(d) ( Offer, Acceptance, Sale and Purchase ) of the relevant Master Receivables Purchase Agreement other than the U.S. Receivables Purchase Agreement, and, when used in respect of each U.S. Purchased Receivable in connection with the U.S. Receivables Purchase Agreement, has the meaning given in clause 2.1(e) ( Offer, Acceptance, Sale and Purchase or Contribution ) of the U.S. Receivables Purchase Agreement.
“ Related Security ” means with respect to any Purchased Receivable:
(a)          all of the relevant Seller’s interest in any goods (including returned goods) relating to any sale giving rise to such Purchased Receivable;
(b)          all security interest or liens and property subject thereto from time to time purporting to secure payment of such Purchased Receivable, whether pursuant to the Contract related to such Purchased Receivable or otherwise;
(c)          all guarantees, insurance and other agreements or arrangements of whatever character from time to time supporting or securing payment of such Purchased Receivable whether pursuant to the Contract related to such Purchased Receivable or otherwise; and
(d)          the Contract and all other books, records and other information (including computer programmes, tapes, discs, data processing software and related property and rights) relating to such Purchased Receivable and the related Obligor.
“ Relevant ” means:
(a)        when used in relation to the execution of or the entering into of a Transaction Document and in conjunction with a reference to any Transaction Party, a Transaction Document which such Transaction Party is required to execute or enter into or has executed or entered into; and
(b)          when used in respect of the Transaction Documents generally and in conjunction with a reference to any particular Transaction Party, the Transaction Documents to which such Transaction Party is a party together with the

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Transaction Documents that contain provisions that otherwise bind or confer rights upon such Transaction Party;
and references to “ Relevant Transaction Documents ” and cognate expressions shall be construed accordingly.
“ Relevant Daily Report ” means the Swiss Sellers’ Daily Report delivered three Business Days prior to the date of determination or, if applicable, on the relevant Reporting Date on which a Seller makes an Initial Purchase Price Payment Request.
“ Relevant Interest Amount ” means, depending on the context:
(a)        the Regency Note Interest Amount; or
(b)        the Styron Note Interest Amount.
“ Relevant Senior Costs Amount Proportion ” means, in respect of any Purchased Receivable, an amount equal to (i) the Senior Costs Amount for the Determination Period in which a Collection in respect of such Receivable is multiplied by (ii) the fraction, the numerator of which is such Collection and the denominator of which is the aggregate of all Collections received in such Determination Period.
“ Removal Notice ” has the meaning set out in the Styron Security Deed.
“ Reporting Date ” means a Monthly Reporting Date or a Daily Reporting Date, as the case may be.
“ Required Filings ”  means in respect of the Master Purchaser:
(a)          the filing of prescribed particulars of the security interests created by the Master Purchaser under the Styron Security Deed with the Irish Registrar of Companies in accordance with the provisions of Section 99 of the Irish Companies Act 1963 and payment of the associated fees; and
(b)          the filing of a notice with the Irish Revenue Commissioners in respect of the security interests created under the Styron Security Deed in accordance with Section 1001 of the Taxes Consolidation Act 1997.
“ Requirement of Law ” in respect of any Person shall mean:
(a)        any law, treaty, rule, requirement or regulation;
(b)        a notice by or an order of any court having jurisdiction;
(c)        a mandatory requirement of any regulatory authority having jurisdiction; or
(d)        a determination of an arbitrator or Governmental Authority;
in each case applicable to or binding upon that Person or to which that person is subject or with which it is customary for it to comply.

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“ Retiring Cash Manager ” means the Cash Manager or any successor whose appointment is terminated pursuant to the Cash Management Agreement other than by termination at the Final Discharge Date.
“ Reuters Screen Rate ” means:
(a)        in relation to LIBOR, the London interbank offered rate administered by ICE Benchmark Administration Limited (or any other person which takes over the administration of that rate) for the relevant currency and period; and
(b)          in relation to EURIBOR, the euro interbank offered rate administered by the European Money Markets Institute (or any other person which takes over the administration of that rate) for the relevant period;
in each case displayed on the appropriate page of the Reuters screen, and if such page is replaced or such service ceases to be available the Instructing Party may specify another page or service displaying the appropriate rate, provided that if, in either case, that rate is less than zero, LIBOR and/or EURIBOR, as the case may be, shall be deemed to be zero; and
(c)        in relation to LIBOR and/or EURIBOR, as the case may be, if such page or service ceases to be available and no alternate page or service is available, then the rate of interest shall be the determined in accordance with Clause 12.5 of the Liquidity Facility Agreement.
“ Revenue Ledger ” means the ledger in the books of the Master Purchaser so named.
“ Right ” means any asset, agreement, property or right.
“ Roll Date ” means each Monthly Payment Date and each other date determined in accordance with Section B, Clause 6.4.4 of the Variable Loan Note Issuance Deed.
“ Rolling Average Turnover Ratio ” means:
(a)        the sum of the last three (3) months of Purchase Receivables, divided by
(b)        the sum of the last three (3) months of Collections, multiplied by
(c)        30.
“ Sanctions ” means the sanctions laws, regulations, embargoes or restrictive measures administered, enacted or enforced by any of the Sanctions Authorities.
“ Sanctions Authorities ” means:
(i)           the United States government;
(ii)       the United Nations;
(iii)      the European Union;
(iv)         the United Kingdom;

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(v)        Switzerland;
(vi)       Hong Kong; and
(vii)      the respective Governmental Authorities of any of the foregoing, including without limitation, OFAC, the US Department of State and Her Majesty’s Treasury.
“ SEC ” means the United States Securities and Exchange Commission.
“ Secondary VAT Liability ” means a liability of the Master Purchaser for VAT remaining unpaid in the bankruptcy of a Swiss Seller and relating to VAT included in the Receivables assigned and transferred by the relevant Swiss Seller to the Master Purchaser in accordance with the Swiss Receivables Purchase Agreement.
“ Secured Amounts ” means the aggregate of all moneys and Liabilities which from time to time are or may become due, owing or payable by the Master Purchaser to each, some or any of the Secured Creditors under the Notes or the Transaction Documents.
“ Secured Creditors ” means the Styron Security Trustee in its own capacity and as trustee on behalf of those persons listed as entitled to payment by the Master Purchaser in Clause 15 ( Post-Enforcement Payments Priorities ) of the Styron Security Deed.
“ Securitisation Availability Period ” means the period from and including the Swiss Funding Date to (but excluding) the Programme Termination Date.
“ Security ” means the security created in favour of the Styron Security Trustee pursuant to the Styron Security Deed, the German Security Assignment and Trust Agreement and the U.S. Security Agreement.
“ Security Protection Notice ” means a notice served by the Styron Security Trustee pursuant to clause 11 ( Security Protection Notice ) of the Styron Security Deed.
“ Seller ” means each of:
(a)        the Swiss Sellers;
(b)        the German Seller;
(c)        the Dutch Seller;
(d)        the U.S. Seller;
(e)        the U.S. Intermediate Transferor; and
(f)        any other entity in its capacity as a seller of Receivables to the Master Purchaser under a Master Receivables Purchase Agreement,
together the “ Sellers ”.

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“ Seller and Servicer Party Agent ” means the Parent appointed to act on behalf of each Seller and Servicer Party in relation to the Transaction Documents pursuant to Clause 3 ( Seller and Servicer Party Agent )  of this Deed.
“ Seller Permitted Encumbrance ” means:
(a)        any Encumbrance created by a Seller by or pursuant to the Transaction Documents;
(b)          any netting or set-off arrangement pursuant to which the Collection Account Bank is permitted to deduct the amount of any normal account fees owed to it or chargebacks on account of provisional credits, in each case, in connection with a Collection Account from amounts standing to the credit of such Collection Account;
(c)        any other Encumbrance over the Collection Accounts provided such Encumbrance is subordinated to any Encumbrance granted in favour of the Security Trustee over the Collection Accounts; and
(d)        any Encumbrance over the Transaction Documents (including a Seller’s rights, if any, to Deferred Purchase Price).
“ Seller’s Credit and Collection Procedures ” means the origination, credit and collection procedures employed by the relevant Seller from time to time in relation to the provision and sale of chemical products and related services as attached to this Deed as Appendix A, as may be amended with the consent of the Cash Manager from time to time.
“ Senior Costs Amount ” means the amounts payable in items one through seven of Schedule 1 Paragraph 11.1 ( Payment from Distribution Ledgers on a Monthly Payment Date ) of the Cash Management Agreement.
“ S&P ” means Standard & Poor’s Ratings Services, a Standard & Poor’s Financial Services LLC business or the successor to its rating business.
“ Servicer ” means each Swiss Servicer, the German Servicer, the Dutch Servicer or the U.S. Servicer (as the context may require).
“ Servicer Default ” means a Dutch Servicer Default, a German Servicer Default, a Swiss Servicer Default or a U.S. Servicer Default, as applicable.
“ Servicing Agreement ” means the Dutch Servicing Agreement, the German Servicing Agreement, the Swiss Servicing Agreement or the U.S. Servicing Agreement, as the context requires.
“ Settlement Date Payments Priorities ” means the provisions relating to the order of priority of payments set out in Paragraph 10 ( Payments from Distribution Ledgers on a Settlement Date ) of Part 5 ( Payments Priorities ) of Schedule 1 ( Services to be provided by the Cash Manager ) of the Cash Management Agreement.

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“ Settlement Date ” means:
(a)        each day on which a Swiss Servicers’ Daily Report is delivered or Initial Purchase Price or Deferred Purchase Price is paid;
(b)        the Swiss Funding Date;
(c)        each Roll Date; and
(d)        the day falling three Business Days after the day an Initial Purchase Price Payment Request is delivered by a Seller.
“ Solvency Certificate ” means each solvency certificate executed by a Seller in the form set out in Schedule 2 to the relevant Master Receivables Purchase Agreement.
“ Special Concentration Limit ” has the meaning set out in paragraph (u) of Schedule 3.
“ Specified Office ” means, in relation to any Person:
(a)        the office specified against its name in the Notices Details; or
(b)        such other office as such Person may specify in accordance with the Transaction Documents.
“ Spot Rate ” means the Cash Manager’s spot rate of exchange for the purchase of one specified currency with another specified currency in the London foreign exchange market.
“ Standard Documentation ” means the standard terms and conditions of the Sellers set out in Schedule 11 ( Standard Documentation ) and such other documentation as may be approved in writing by the Cash Manager from time to time.
“ Styron EUR Note ” means the EUR denominated note issued by the Master Purchaser to the Styron Noteholder pursuant to the Variable Loan Note Issuance Deed.
“ Styron EUR Note Additional Principal Amount ” means as at any date of determination the amount by which the Styron EUR Note Required Amount exceeds the Styron EUR Note Principal Amount Outstanding.
“ Styron EUR Note Initial Principal Amount ” means the EUR Proportion of the Styron Percentage of the Purchase Base specified in the first Current Swiss Servicer’s Daily Report delivered by the Current Swiss Servicer.
“ Styron EUR Note Principal Amount Outstanding ” means:
(a)        on the Swiss Funding Date, the Styron EUR Note Initial Principal Amount; and
(b)        on any day following the Swiss Funding Date, the Styron EUR Note Principal Amount Outstanding as at the end of the immediately preceding day:
(i)         plus (if such day is a Settlement Date) the amount of any Styron EUR Note Additional Principal Amount paid by the Styron Noteholder on such day;

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(ii)       minus (if such day is a Settlement Date) the Styron EUR Note Redemption Amount paid to the Styron Noteholder on such day.
“ Styron EUR Note Redemption Amount ” means:
(a)          prior to the occurrence of a Termination Event that is continuing, the amount, if any, by which the Styron EUR Note Principal Amount Outstanding exceeds the Styron EUR Note Required Amount less the Outstanding Balance of all German Purchased Receivables which have become Written-Off Receivables since the date of determination immediately preceding the last Settlement Date on which the Principal Amount Outstanding of the Styron EUR Notes have been adjusted; and
(b)          following the occurrence of a Termination Event that is continuing, the EUR Proportion of the Styron Percentage of the balance stood to the credit of the Master Purchaser Accounts following payment of items first to eleventh in the Pre-Enforcement Payments Priorities on the relevant Monthly Payment Date.
“ Styron EUR Note Required Amount ” means, as at any date of determination, the following amount:
(a)        the EUR Equivalent of the Purchase Base (specified in the Relevant Daily Report) multiplied by the Styron Percentage and by the EUR Proportion; plus
(b)          the Outstanding Balance of all German Purchased Receivables multiplied by the German Purchase Rate; less
(c)        the product of:
(i)           the EUR Equivalent of the Purchase Base (specified in the Relevant Daily Report); and
(ii)       the fraction:
(A)       the numerator of which is the Outstanding Balance of the German Purchased Receivables which are Eligible Receivables; and
(B)       the denominator of which is the EUR Equivalent of the Eligible Pool Balance,
but which shall from 1 January 2015, at any time where the Regency Note remains outstanding or the Regency Noteholder has any obligations to subscribe for further Notes, always be at least 5 per cent of the Outstanding Balance of all German Purchased Receivables.
“ Styron Germany Account Pledge Agreement ” means the Styron Germany Account Pledge Agreement executed by the German Seller, the Master Purchaser and the Styron Security Trustee with respect to the German Collection Accounts on 24 May 2011.
“ Styron Notes ” means the Styron USD Note and the Styron EUR Note.

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“ Styron Notes Initial Principal Amount ” means the Styron EUR Note Initial Principal Amount or the Styron USD Note Initial Principal Amount as applicable.
“ Styron Note Interest Amount ” means, in respect of any Monthly Payment Date, in respect of a Styron Note the aggregate of the results of the following formula being applied in respect of each $1 or €1 Principal Amount Outstanding of the relevant Styron Note that was outstanding at any point during the relevant Interest Period (rounded to the nearest eurocent, half a eurocent being rounded up):
( ( A / 360 ) x ( B x C ) )
where

A	=	the exact number of days during the relevant Interest Period that such $1 or €1 of Principal Amount Outstanding was outstanding;	
 	 	 	
B	=	such $1 or €1 of Principal Amount Outstanding of the relevant Styron Note, as the case may be; and	
 	 	 	
C	=	the Note Interest Rate in respect of such Monthly Payment Date;	
 
plus any part of the Styron Note Interest Amount in respect of the immediately preceding Monthly Payment Date not paid on such immediately preceding Monthly Payment Date, plus the amount of Default Interest due on such unpaid amount.
“ Styron Noteholder ” means the holder for the time being of the Styron Notes.
“ Styron Note Redemption Amount ” means the Styron EUR Note Redemption Amount or the Styron USD Note Redemption Amount as applicable.
“ Styron Percentage ” means:
(a)        in respect of the Styron EUR Note; or
(b)        in respect of the Styron USD Note,
the percentage notified to the Master Purchaser pursuant to Clause 6.4 ( Notification of Styron Percentage ) of the Variable Loan Note Issuance Deed in respect of such Note.
“ Styron Security Deed ” means the deed so named dated 12 August 2010, as amended and restated 24 May 2011 and on or around the Dutch Closing Date between the Master Purchaser, the Styron Security Trustee, the Regency Noteholder and the Styron Noteholder.
“ Styron Security Trustee ” means the Law Debenture Trust Corporation plc or any other Person acting as security trustee from time to time pursuant to the Styron Security Deed.
“ Styron Security Trustee Termination Event ” has the meaning set out in the Styron Security Deed.

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“ Styron USD Note ” means the US Dollar denominated note issued by the Master Purchaser to the Styron Noteholder pursuant to the Variable Loan Note Issuance Deed.
“ Styron USD Note Additional Principal Amount ” means the greater of (i) zero and (ii) the USD Proportion of the Styron Percentage of the Purchase Base specified in the Swiss Servicers’ Daily Report delivered three Business Days prior to the relevant Roll Date or, if applicable, on the relevant Reporting Date on which a Seller makes an Initial Purchase Price Payment Request less the Principal Amount Outstanding of the Styron USD Note immediately prior to the relevant Roll Date.
“ Styron USD Note Initial Principal Amount ” means the USD Proportion of the Styron Percentage of the Purchase Base specified in the first Current Swiss Servicer’s Daily Report delivered by the Current Swiss Servicer.
“ Styron USD Note Principal Amount Outstanding ” means:
(a)        on the Swiss Funding Date, the Styron USD Note Initial Principal Amount; and
(b)          on any day following the Swiss Funding Date, the Styron USD Note Principal Amount Outstanding as at the end of the immediately preceding day:
(i)           plus (if such day is a Settlement Date) the amount of any Styron USD Note Additional Principal Amount paid by the Styron Noteholder on such day;
(ii)       minus (if such day is a Settlement Date) the Styron USD Note Redemption Amount paid to the Styron Noteholder on such day.
“ Styron USD Note Redemption Amount ” means:
(a)          prior to the occurrence of a Termination Event that is continuing, the greater of (i) zero and (ii) the Principal Amount Outstanding of the Styron USD Note immediately prior to the relevant Settlement Date less the USD Proportion of the Styron Percentage of the Purchase Base specified in the Swiss Servicers’ Daily Report delivered three Business Days prior to the relevant Roll Date; and
(b)          following the occurrence of a Termination Event that is continuing, the USD Proportion of the Styron Percentage of the balance stood to the credit of the Master Purchaser Accounts following payment of items first to eleventh in the Pre-Enforcement Payments Priorities on the relevant Roll Date.
“ Sub-contractor ” means any sub-contractor, sub-agent, delegate or representative.
“ Subsidiary ” means any corporation or other entity of which securities having ordinary voting power to elect a majority of the board of directors or other Persons performing similar functions are at the time directly or indirectly owned by a Seller.
“ Successor Master Purchaser Account Bank ” means an entity appointed in accordance with Clause 20 ( Successor Master Purchaser Account Bank ) or Clause 21 ( Master Purchaser Account Bank may appoint Successors ) of the Account Bank Agreement to act as successor account bank under the Account Bank Agreement.

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“ Successor Cash Manager ” means an entity identified in accordance with Clause 20 ( Identification of Successor Cash Manager ) of the Cash Management Agreement and appointed in accordance with Clause 21 ( Appointment of Successor Cash Management ) of the Cash Management Agreement to perform the Cash Management Services.
“ Successor Styron Security Trustee ” means an entity appointed in accordance with Clause 26 ( Styron Security Trustee’s Retirement & Removal ) of the Styron Security Deed to act as successor trustee under the Styron Security Deed.
“ Supplemental Deed ” means a deed supplemental to the Styron Security Deed.
“ Swiss Code of Obligations ” or “ CO ” means the Swiss Federal Code of Obligations of 30 March 1911, as amended from time to time.
“ Swiss Collection Accounts ” means the Collection Accounts owned by the Swiss Sellers, which receive Collections related to the Swiss Purchased Receivables sold by the Swiss Sellers to the Master Purchaser pursuant to the Swiss Receivables Purchase Agreement.
“ Swiss Federal Act on Debt Collection and Bankruptcy ” or “ DEBA ” means the Swiss Federal Act on Debt Collection and Bankruptcy of 11 April 1889, as amended from time to time.
“ Swiss Funding Date ” means the day falling two Business Days after the day the first Offer is delivered under the Swiss Receivables Purchase Agreement or such other date as may be agreed by the Swiss Sellers and the Instructing Party.
“ Swiss Purchased Receivables ” means the Receivables purchased by the Master Purchaser on the terms of the Swiss Receivables Purchase Agreement.
“ Swiss Receivables ” means Receivables originated by a Swiss Seller.
“ Swiss Receivables Purchase Agreement ” means the receivables purchase agreement dated 12 August 2010, as amended and restated on 24 May 2011, 30 May 2013 and on the 2016 Amendment Effective Date between the Swiss Sellers, the Master Purchaser, the Investment Manager and the Styron Security Trustee.
“ Swiss Sellers ” means each of (i) Trinseo Europe GmbH (formerly Styron Europe GmbH), incorporated in Switzerland and (ii) Trinseo Export GmbH, incorporated in Switzerland, each in its capacity as seller of Receivables to the Master Purchaser under the Swiss Receivables Purchase Agreement, and shall include both such sellers or either of them, as the context may require. For the avoidance of doubt, references to the Swiss Seller in the German Receivables Purchase Agreement shall include both Swiss Sellers.
“ Swiss Seller Credit and Collection Procedures ” means the Sellers’ Credit and Collection Procedures with respect to a Swiss Seller.
“ Swiss Servicers ” means each Person designated as such under the Swiss Servicing Agreement.
“ Swiss Servicer Default ” means the occurrence of any of the events described in Schedule 2 hereto.

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“ Swiss Servicer Fee Percentage ” means 0.25 per cent.
“ Swiss Servicer Fees ” means the fees referred to in clause 13 of the Swiss Servicing Agreement.
“ Swiss Servicer Report ” means the Swiss Servicers’ Daily Report or the Swiss Servicers’ Monthly Report (as the case may be).
“ Swiss Servicers’ Daily Report ” means any document prepared by a Swiss Servicer in accordance with Clause 7.2 ( Swiss Servicers’ Daily Reports ) of the Swiss Servicing Agreement additionally including all the data required to be contained in the German Servicer’s Daily Report, the Dutch Servicer’s Daily Report and the U.S. Servicer’s Daily Report.
“ Swiss Servicers’ Monthly Report ” means a report in substantially the form of the Excel spreadsheet attached to the email from Caponi@Trinseo.com to victoria.lindsell@hsbcib.com; graham.s.walton@hsbcib.com; rebecca.andrew@hsbcib.com; aanand.kanani@hsbc.com and Frisch@trinseo.com, with the subject “Monthly Report August 2016- Styron AR Securitization and Offer” on 29 September 2016 adjusted to include all relevant data for the Acceding Swiss Seller and containing all the data required to be included in the German Servicer’s Monthly Report, the Dutch Servicer’s Monthly Report, the U.S. Servicer’s Monthly Report and such additional information with respect to the Purchased Receivables as the Master Purchaser or the Instructing Party may reasonably request from time to time and prepared by the Swiss Servicer and delivered to the Master Purchaser and the Instructing Party in accordance with Clause 7.1 ( Swiss Servicers’ Monthly Reports ) of the Swiss Servicing Agreement.
“ Swiss Servicing Agreement ” means the Swiss Servicing Agreement dated 12 August 2010, as amended and restated on 30 May 2013 and on the 2016 Amendment Effective Date, relating to the Swiss Purchased Receivables between the Master Purchaser, the Swiss Servicers and the Styron Security Trustee.
“ Swiss VAT Rate ” means the applicable rate of VAT as set out in VATA 2010.
 “ TARGET ” means Trans-European Automated Real-time Gross Settlement Express Transfer system.
“ TARGET Day ” means a day on which the TARGET system is open for settlement of payments in Euro.
“ TARGET System ” means the Trans-European Automated Real-time Gross Settlement Express Transfer system.
“ Tax Authority ” means any government, state or municipality or any local, state, federal or other authority, body or official anywhere in the world exercising a fiscal, revenue, customs or excise function (including, Her Majesty’s Revenue and Customs).
“ Tax Credit ” means any credit received by a Transaction Party from a Tax Authority in respect of any Tax paid by such Transaction Party.
“ Tax Deduction ” means any deduction or withholding on account of Tax.

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“ Taxes ” means any present or future taxes, levies, duties, charges, fees, deductions or withholdings of any nature whatsoever imposed or levied by or on behalf of Switzerland, the United Kingdom, Ireland, any other Eligible Country or the United States of America, together with any interest, charges or penalties thereon and “ Tax ” and “ Taxation ” and similar words shall be construed accordingly.
“ Tax Event ” has the meaning given to it in Condition 5 of the Notes.
“ Tax Treaty ” means a double taxation treaty into which Ireland has entered which contains an article dealing with interest or income from debt claims.
“ Ten Non-Bank Rule ” means the rule that the aggregate number of creditors of a Swiss Borrower under the Finance Documents which are not Qualifying Banks must not at any time exceed 10 (ten), all in accordance with the meaning of the Guidelines.
“ Termination Event ” means the occurrence of any of the events set out in Part A of Schedule 1.
“ Total Facility Limit ” means USD 450,000,000.
“ Total Reserves ” means, as of the Determination Date, an amount equal to the sum of the Carrying Cost Reserve as at such date plus the Loss and Dilution Reserve as at such date.
“ Transaction ” means the connected transactions contemplated by the Transaction Documents.
“ Transaction Documents ” means:
(a)        the Swiss Receivables Purchase Agreement;
(b)        the German Receivables Purchase Agreement;
(c)        the Dutch Receivables Purchase Agreement;
(d)        the U.S. Receivables Purchase Agreement;
(e)        the U.S. Intermediate Transfer Agreement;
(f)        the Swiss Servicing Agreement;
(g)        the German Servicing Agreement;
(h)        the Dutch Servicing Agreement;
(i)         the U.S. Servicing Agreement;
(j)         the Master Definitions and Framework Deed;
(k)        the Variable Loan Note Issuance Deed;
(l)         the Cash Management Agreement;

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(m)       the Styron Security Deed;
(n)        the German Security Assignment and Trust Agreement;
(o)        the U.S. Security Agreement;
(p)        the Account Bank Agreement;
(q)        the Guarantee Agreement;
(r)        the Corporate Services Agreement;
(s)        each Account Control Agreement;
(t)         the Fee Letter;
(u)        the Master Purchaser Receivables Power of Attorney;
(v)        the U.S. Intermediate Transferor Receivables Power of Attorney;
(w)       the Notes; and
(x)        any other document so designated by the Cash Manager and the Master Purchaser.
“ Transaction Party ” means any person who is a party to a Transaction Document and “ Transaction Parties ” means some or all of them.
“ Transfer Period ” means a period of two months from the termination or the appointment of a Cash Manager, as the case may be.
“ Treaty ” means the Treaty establishing the European Community, as amended.
“ Trinseo Entity ” means the Parent and each of its Affiliates.
“ Trinseo Export German Account Pledge Agreement ” means an Account Pledge Agreement executed by the Pledgor, the Master Purchaser and the Styron Security Trustee with respect to the Collection Accounts dated on or about the 2016 Amendment Effective Date.
 “ Trinseo Party ” means each Trinseo Entity which is party to a Transaction Document.
“ Trust Corporation ” means a corporation entitled by the rules made under the Public Trustee Act 1906 to act as a custodian trustee or entitled pursuant to any other legislation applicable to a trustee in any jurisdiction other than England and Wales to act as trustee and carry on trust business under the laws of the country of its incorporation.
“ Trust Proceeds ” means all recoveries, receipts and benefits received by the Styron Security Trustee by virtue of the Trust Property save for monies or other assets which it is entitled to retain for its own account or which are earmarked for receipt by a third party other than as part of the Trust Property.

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“ Trust Property ” means the Covenant to Pay, the Master Purchaser Covenants, the Master Purchaser Warranties, the Security and all proceeds of the Security.
“ Trustee Acts ” means the Trustee Act 1925 and the Trustee Act 2000;
“ Twenty Non-Bank Rule ” means the rule that the aggregate number of creditors (including the Lenders), other than Qualifying Banks, of a Swiss Borrower under all outstanding debts relevant for classification as debenture ( Kassenobligation ) (within the meaning of the Guidelines), such as (intragroup) loans, facilities or private placements (including under the Finance Documents) must not at any time exceed 20 (twenty), all in accordance with the meaning of the Guidelines.
“ UCC ” or “ Uniform Commercial Code ” means the Uniform Commercial Code as in effect from time to time in the applicable jurisdiction.
“ UK Account Control Deed ” means the deed so named dated on or about the Closing Date between the Chargor, the Master Purchaser, the Chargee and the Styron Security Trustee.
“ UK Collection Account Bank ” means Deutsche Bank AG London, acting through its office at 1 Great Winchester Street, London EC2N 2DB.
“ Unapplied Credit ” means, on any date, the aggregate amount of outstanding credit notes issued to Obligors as of such date which have not been applied to reduce or off- set the Outstanding Balance of Receivables owed by any Obligor.
“ Unbilled Purchase Rate ” means the Purchase Rate.
“ Unbilled Receivables ” means a Receivable with respect to which:
(a)        the relevant Seller has received a purchase order from the Obligor for chemical products;
(b)          the goods have been delivered by the relevant Seller to the Obligor and a delivery note for the products has been signed by the Obligor and retained by the relevant Haulage Company; and
(c)        the Obligor has become obligated to pay for the products in accordance with the relevant Contract,
but in respect of which the relevant Seller has not yet issued an Invoice to the Obligor.
“ Unbilled Receivables Limit ” means an aggregate cap limit of 20% of the Receivables Pool.
“ Unbilled Receivables Overconcentration Amount ” means, on any Determination Date, the aggregate amount of Receivables owed by Obligors in respect of Receivables which were Unbilled Receivables on the day the Offer in respect of such Receivables was made to the Master Purchaser exceeds the Unbilled Receivables Limit.
“ Unrestricted Country ” means the countries listed in Schedule 5 or such other countries as agreed between the Sellers and the Regency Noteholder (acting reasonably

54

and in good faith) from time to time, or any Eligible Country so designated from time to time by the Regency Noteholder (acting reasonably and in good faith), and, for the avoidance of doubt, for such period of time as may be designated by the Regency Noteholder (acting reasonably and in good faith).
“ U.S. ” means the United States of America.
“ U.S. Account Control Agreement ” means each Deposit Account Control Agreement by which the U.S. Seller has created security over the U.S. Collection Accounts and any other account control agreements entered into among the U.S. Seller, the U.S. Intermediate Transferor, the Master Purchaser, the Styron Security Trustee and the relevant Collection Account Bank.
“ Usage Fee ” means the fee specified as such in the Fee Letter.
“ U.S. Collection Accounts ” means the Collection Accounts owned by the U.S. Seller, which receive Collections related to the Purchased Receivables sold or contributed by the U.S. Seller to the U.S. Intermediate Transferor pursuant to the U.S. Receivables Purchase Agreement.
“ U.S. Closing Date ” has the meaning given to it in the U.S. Receivables Purchase Agreement.
“ USD Equivalent ” means, as of any date, the amount obtained by applying the rate for converting the relevant currency into USD at:
(a)        in the case of the Swiss Servicers’ Monthly Report, the most recently determined internal month end rate of a Swiss Seller;
(b)          in the case of the Swiss Servicers’ Daily Report, the Spot Rate of exchange for that currency as at 9am in London on the preceding Business Day as notified by the Cash Manager to the Sellers on such Business Day;
(c)        in the case of the Dutch Servicer’s Monthly Report, the most recently determined internal month end rate of the Dutch Seller; and
(b)          in the case of the Dutch Servicer’s Daily Report, the Spot Rate of exchange for that currency as at 9am in London on the preceding Business Day as notified by the Cash Manager to the Sellers on such Business Day.
“ USD Proportion ” means, in respect of an amount, that amount multiplied by the fraction the numerator of which is aggregate Outstanding Balance of all Purchased Receivables denominated in US Dollars and the denominator of which is aggregate Outstanding Balance of all Purchased Receivables (calculated using the USD Equivalent of any Outstanding Balance denominated in a currency other than US Dollars).
“ U.S. Funding Date ” means the day falling two Business Days after the day the first Offer is delivered under the U.S. Receivables Purchase Agreement or such other date as may be agreed by the U.S. Seller and the Cash Manager.

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“ U.S. Insolvency Event ” means with respect to any Person, the occurrence of the following:
(a)        such Person shall voluntarily commence any case, proceeding or other action, or present a petition or make an application under any Insolvency Law:
(i)           relating to bankruptcy, insolvency, court protection, reorganization or relief of debtors, seeking to have an order for relief entered with respect to it or seeking to adjudicate it a bankrupt or insolvent, or seeking reorganization, arrangement, adjustment, winding-up, examination, liquidation, administration, administrative receivership, dissolution, court protection, composition, declaration or other similar relief with respect to it or any of its debts; or
(ii)       seeking the appointment of a liquidator, receiver, administrative receiver, examiner, security trustee, custodian, compulsory manager, administrator or other similar official for it or for all or any substantial part of its assets;
(b)          there shall be commenced, presented or made against such Person any case, proceeding or other action referred to in (a) above which is not dismissed by the relevant court, tribunal or authority within sixty (60)   days after its commencement;
(c)          there shall be commenced against such Person any case, proceeding or other action seeking issuance of a warrant of attachment, sequestration, distress, expropriation, execution, distraint or similar process against all or any substantial part of its assets which is not dismissed within sixty (60) days after its commencement; or
(d)          a moratorium is declared in respect of any of its debt.
“ U.S. Intermediate Transfer Agreement ” means the intermediate receivables purchase agreement dated on or about the U.S. Closing Date, among the U.S. Intermediate Transferor, the Master Purchaser and the Investment Manager.
“ U.S. Intermediate Transferor ” means Trinseo U.S. Receivables Company SPV LLC, a Delaware limited liability corporation.
“ U.S. Intermediate Transferor Receivables Power of Attorney ” means a power of attorney substantially in the form of Part A of Schedule 4 to the U.S. Receivables Purchase Agreement.
“ U.S. Primary Transaction Documents ” means:
(a)        the U.S. Receivables Purchase Agreement;
(b)          the U.S. Intermediate Transfer Agreement; and
(c)        the U.S. Servicing Agreement.

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“ U.S. Purchased Receivables ” means the Receivables purchased by or contributed to the U.S. Intermediate Transferor on the terms of the U.S. Receivables Purchase Agreement.
“ U.S. Receivables Purchase Agreement ” means the receivables purchase agreement dated on or about the U.S. Closing Date among the U.S. Seller, the Investment Manager and the U.S. Intermediate Transferor.
“ U.S. Security Agreement ” means the Security Agreement dated on or about the U.S. Closing Date between the Master Purchaser and the Styron Security Trustee.
“ U.S. Seller ” means Trinseo LLC (formerly Styron LLC), a Delaware limited liability company, in its capacity as seller of Receivables to the U.S. Intermediate Transferor under the U.S. Receivables Purchase Agreement.
“ U.S. Seller Credit and Collection Procedures ” means the Seller’s Credit and Collection Procedures with respect to the U.S. Seller.
“ U.S. Servicer ” means the Person designated as such under the U.S. Servicing Agreement.
“ U.S. Servicer Default ” means the occurrence of any of the events described in Schedule 2 hereto as if each reference therein to “Swiss Servicer” was a reference to “U.S. Servicer”, each reference to “Swiss Receivables Purchase Agreement” was a reference to “U.S. Receivables Purchase Agreement” or “U.S. Intermediate Transfer Agreement” and each reference to “Swiss Servicing Agreement” was a reference to “U.S. Servicing Agreement”.
“ U.S. Servicer Report ” means a U.S. Servicer’s Monthly Report or U.S. Servicer’s Daily Report as the case may be.
“ U.S. Servicer’s Daily Report ” means any document prepared by the U.S. Servicer in accordance with Clause 7.2 ( U.S. Servicer’s Daily Reports ) of the U.S. Servicing Agreement, provided that all data required to be included in the U.S. Servicer’s Daily Report shall be consolidated in the Swiss Servicers’ Daily Report.
“ U.S. Servicer’s Monthly Report ” means any document prepared by the U.S. Servicer in accordance with Clause 7.1 ( U.S. Servicer’s Monthly Reports ) of the U.S. Servicing Agreement, including, for the avoidance of doubt, any consolidated monthly report delivered by or on behalf of all of the Servicers, provided that all data required to be included in the U.S. Servicer’s Monthly Report shall be consolidated in the Swiss Servicers’ Monthly Report.
“ U.S. Servicing Agreement ” means the servicing agreement to be dated on or about the U.S. Closing Date, among the U.S. Servicer, the U.S. Seller, U.S. Intermediate Transferor and the Master Purchaser, relating to the U.S. Purchased Receivables.
“ U.S. Servicer Fees ” means the fees referred to in clause 14 of the U.S. Servicing Agreement.

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“ U.S. Transaction Documents ” means:
(a)        the U.S. Receivables Purchase Agreement;
(b)        the U.S. Intermediate Transfer Agreement;
(c)        the U.S. Servicing Agreement;
(d)        the U.S. Security Agreement;
(e)        each U.S. Account Control Agreement;
(f)           the U.S. Intermediate Transferor Receivables Power of Attorney;
(g)        the Master Receivables Power of Attorney given by the U.S. Seller; and
(h)        any other document so designated by the U.S. Seller, the Cash Manager and the Master Purchaser.
“ Value Added Tax ” and “ VAT ” shall be construed as a reference to value added tax under the laws of any jurisdiction.
“ VATA 2010 ” means the Swiss Value Added Tax Act 2010 (as amended).
“ Variable Loan Note Issuance Deed ” means the variable loan note issuance deed dated the Closing Date and as amended and restated on 24 May 2011, 30 May 2013 and on or about the 2016 Amendment Effective Date between the Master Purchaser, the Registrar, the Cash Manager, the Styron Security Trustee and the Noteholders.
“ VAT Group ” means a group for the purposes of the VAT Grouping Legislation.
“ VAT Grouping Legislation ” means the Value Added Tax Act 1972 of Ireland (as amended).
“ Written-off Receivable ” means any Purchased Receivable (i) in respect of which the relevant Obligor is insolvent or is in bankruptcy, liquidation, administration or any analogous proceedings or (ii) in respect of which a declaration has been made (or ought to have been made) by the relevant Seller that such Receivable is irrecoverable in accordance with the related Seller’s Credit and Collection Policies.
2.2        Any reference in any Transaction Document to:
“ administration ”, “ bankruptcy ”, “ liquidation ”, “ dissolution ”, ” receivership ” or “ winding-up ” of a person shall be construed so as to include any equivalent or analogous proceedings (including any suspension of payments) under the laws of the jurisdiction in which such person is incorporated (or, if not a company or corporation, domiciled) or any jurisdiction in which such person has its principal place of business.
“ agreed form ” means, in relation to any documents, the draft of the document which has been agreed between the relevant parties thereto and initialled on their behalf for the purpose of identification.

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“ Clause ”, “ Recital ”, “ Appendix ” or “ Schedule ” in any Transaction Document is, subject to any contrary indication, a reference to a Clause of, or a recital or appendix or schedule to, the relevant Transaction Document.
an event (howsoever defined) “ subsisting ” or “ continuing ” is if that event which has occurred but has not been remedied (if capable of remedy) or waived.
“ EUR ” or “ € ” or “ euro ” means the currency introduced at the commencement of the third stage of European Economic and Monetary Union as of 1 January 1999 pursuant to the Treaty establishing the European Communities as amended by the Treaty on European Union.
“ holding company ” means, in relation to a company or corporation, any other company or corporation in respect of which it is a subsidiary.
“ including ” shall be construed as meaning including without limitation.
“ indebtedness ” shall be construed so as to include any obligation (whether incurred as principal or as surety) for the payment or repayment of money, whether present or future, actual or contingent.
a person shall be construed as being “ insolvent ” if such person goes into administration, bankruptcy, liquidation, dissolution, receivership or winding-up or such person is unable to pay its debts as they fall due or such person’s liabilities exceed its assets.
“ month ” is a reference to a period starting on one day in a calendar month and ending on the numerically corresponding day in the next calendar month save that, where any such period would otherwise end on a day which is not a Business Day, it shall end on the next Business Day, unless that day falls in the calendar month succeeding that in which it would otherwise have ended, in which case it shall end on the preceding Business Day; provided that , if a period starts on the last Business Day in a calendar month or if there is no numerically corresponding day in the month in which that period ends, that period shall end on the last Business Day in that later month (and references to “ months ” shall be construed accordingly).
“ or ” shall be construed as meaning “and/or.”
“ person ” or “ Person ” shall be construed as a reference to any person, firm, company, corporation, government, state or agency of a state or any association or partnership (whether or not having separate legal personality) of two or more of the foregoing.
“ Pounds Sterling ”, “ pounds ”, “ sterling ”, “ GBP ” or “ £ ” means the lawful currency as at the date of this Deed of the United Kingdom and Northern Ireland.
“ stamp duty ” shall be construed as a reference to any stamp, registration or other documentary Tax or other similar Taxes or duties (including any penalty or interest payable in connection with any failure to pay or any delay in paying out any of the same).
“ subsidiary ” of a company or corporation shall be construed as a reference to any company or corporation (a) which is controlled, directly or indirectly, by the first-mentioned company or corporation; or (b) more than half the issued share capital of which is beneficially owned, directly or indirectly, by the first mentioned company or corporation; or (c) which is a subsidiary of another subsidiary of the first-mentioned company or corporation and for these purposes a company or corporation shall be treated as being controlled by another if that other

59

company or corporation is able to direct its affairs or to control the composition of its board of directors or equivalent body.
“ US Dollars ”, “ dollars ”, “ USD ” or “ $ ” means the lawful currency of the United States as at the date of this Deed.
2.3        Where a definition is stated to mean an amount (the “ first amount ”) which is the greater of zero and another amount (the “ second amount ”) if the second amount is also zero or is a negative amount, the first amount shall be deemed to mean zero.
2.4        When used in any of the Transaction Documents, the terms “ relevant Settlement Date ”, “ relevant Determination Date ” or “ relevant Determination Period ” will mean the Settlement Date, relative to a particular Determination Date or Determination Period, or the Determination Date relative to a particular Determination Period or Settlement Date or the Determination Period relative to a particular Determination Date or Settlement Date as the case may be.
2.5        Where a denominator in any fraction to be used in connection with any calculation in a definition is zero, the relevant fraction will be zero.
2.6        The headings in any Transaction Document shall not affect its interpretation. References to Clauses, Schedules and Articles in any Transaction Document shall, unless its context otherwise requires, be construed as references to the Clauses of, Schedules to, and Articles of such document.
2.7        Unless the context otherwise requires, words denoting the singular number only shall include the plural number also and vice versa, words denoting one gender only shall include the other genders and words denoting persons only shall include firms, corporations and other organised entities, whether separate legal entities or otherwise, and vice versa .
2.8        Unless the context otherwise requires, any reference in any Transaction Document to:
(a)          any agreement or other document shall be construed as a reference to the relevant agreement or document as the same may have been, or may from time to time be, replaced, extended, amended, varied, novated, supplemented or superseded;
(b)          any statutory provision or legislative enactment shall be deemed also to refer to any re-enactment, modification or replacement thereof and any statutory instrument, order or regulation made thereunder or under any such re- enactment;
(c)          any party to a Transaction Document shall include references to its successors, permitted assigns and any person deriving title under or through it; references to the address of any person shall, where relevant, be deemed to be a reference to its address as current from time to time;
(d)          a person shall include a reference to an individual, a partnership, a corporation, a business trust, a joint stock company, a trust, an unincorporated association, a joint venture, a governmental authority and any other entity of whatever nature, as the context may require;

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(e)          unless stated otherwise, any provision setting forth an obligation to pay an amount in respect of remuneration or costs or charges or expenses shall be inclusive of any applicable amount in respect of VAT or similar Tax charged or chargeable in respect thereof at any rate; and
(f)         the provisions contained in any schedule or appendix to any Transaction Document have effect as if they had been incorporated in such Transaction Document.
2.9        Unless expressly agreed otherwise, interest rates and discount factors refer to a calculation in arrears on the basis of actual days elapsed and 360 days per annum for transactions denominated in Euros and 365 days per annum for transactions denominated in Sterling.
2.10      A reference to a Determination Period or Determination Date in any definition or other provision of any other Transaction Document shall, to the extent such Determination Period or Determination Date would fall prior to the Swiss Funding Date, such reference shall be construed as a reference to a complete calendar month and the last day of a complete calendar month respectively.
2.11      Unless otherwise specified, any reference in a Transaction Document to a time of day shall be to the time in London on that day.
3.          AGREEMENT
The parties hereto acknowledge that the provisions contained in Clauses 3 to 8 and Clauses 10 to 25 (inclusive) shall, save where there is an express provision to the contrary, have effect with regard to and apply in respect of, each Transaction Document (as the same shall be amended, varied or supplemented from time to time in accordance with the terms thereof) as though the same were set out therein in full mutatis mutandis .
4.          JURISDICTION
4.1        Submission to Jurisdiction
(a)         Unless expressly otherwise agreed in any of the Transaction Documents, each party agrees that the English courts shall have exclusive jurisdiction to settle any dispute (including claims for set-off and counterclaim) which may arise in connection with the creation, validity, effect, interpretation or performance of, or the legal relationships established by, each of the Transaction Documents (other than the U.S. Transaction Documents), to the extent that it is incorporated in any such document, or otherwise arising in connection with the same and for such purposes irrevocably submits to the jurisdiction of the English courts.
4.2        Forum Conveniens and Enforcement Abroad :
Unless expressly otherwise agreed in any of the Transaction Documents, each party:
(a)          waives any objection to the choice of or submission to the English courts on the grounds of inconvenient forum or otherwise as regards proceedings in connection with any Transaction Documents (other than the U.S. Transaction Documents); and

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(b)          agrees that a judgment, declaration or order (whether interim or final) of an English court in connection with any Transaction Document (other than the U.S. Transaction Documents) is conclusive and binding on it and may be enforced against it in the courts of any other jurisdiction.
4.3        Agents for Service of Process:
Without prejudice to any other mode of service:
(a)          unless expressly otherwise agreed in any of the Transaction Documents, each of the Sellers and the Servicers appoints the following as their respective agents for service of process relating to any proceedings before the English courts pursuant to Clause 4 and agrees to maintain the process agent in England notified to the Instructing Party:
Trinseo UK Limited
06649750
THE GRANARIES NELSON STREET
PE30 5DY KINGS LYNN
UNITED KINGDOM.
(b)          unless expressly otherwise agreed in any of the Transaction Documents the Master Purchaser appoints the following as their respective agent for service of process relating to any proceedings before the courts of England pursuant to Clause 4 and agrees to maintain the process agent in England notified to the Instructing Party:
HSBC Bank plc, 8 Canada Square, London E14 5HQ Attn: Graham Walton and Jeffrey Norman, Structured Finance Middle Office.
(c)          each party agrees that any failure by a process agent to notify any party of the process shall not invalidate the proceedings concerned; and
(d)          each party consents to the service of process relating to any such proceedings by prepaid posting of a copy of the process to its address for service of process for the time being applying under this Deed.
5.          PARTIES TO CASH MANAGEMENT AGREEMENT
5.1        Better preservation and enforcement of rights
The Noteholders agreed to become a party to the Cash Management Agreement only for the better preservation and enforcement of their rights under the Cash Management Agreement and shall not assume any liabilities or obligations under the Cash Management Agreement.
6.          CHANGE OF STYRON SECURITY TRUSTEE
If there is an appointment of a Successor Styron Security Trustee in accordance with the terms of the Styron Security Deed, each of the Transaction Parties shall execute such documents and take such action as the Successor Styron Security Trustee and the outgoing Styron Security Trustee may reasonably require for the purposes of vesting in

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the Successor Styron Security Trustee the benefit of the Transaction Documents and the rights, powers and obligations of the Styron Security Trustee under the Transaction Documents, and releasing the outgoing Styron Security Trustee from its future obligations under the Transaction Documents.
7.          FURTHER ASSURANCES
Each of the parties agrees to perform (or procure the performance of) all further acts and things, and execute and deliver (or procure the execution and delivery of) such further documents, deeds, agreements, consents, notices or authorisations as may be required by law or as may be necessary in:
(a)         the reasonable opinion of the Master Purchaser or the Cash Manager; or
(b)         the opinion of the Styron Security Trustee (acting in its sole discretion),
to implement or give effect to each Transaction Document and the transactions contemplated thereby.
8.          NOTICES
8.1        Any notice to be given by one party to any other party under, or in connection with, any Transaction Document shall be in writing and signed by or on behalf of the party giving it. Any such notice shall be served by sending it by fax to the number set out in Clause 8.2, or delivering it by hand, or sending it by pre-paid recorded delivery or registered post, to the address set out in Clause 8.2, or (if an email address is set out in Clause 8.2 or later notified by the relevant Transaction Party to the other Transaction Parties) by sending an electronic mail (“email”) to the email address set out in Clause 8.2 and in each case marked for the attention of the relevant party (or as otherwise notified from time to time in accordance with the provisions of this Clause 8.1). Any notice so served by hand, fax, post or email shall be deemed to have been duly given:
(a)         in the case of delivery by hand, when delivered;
(b)         in the case of fax, at the time of transmission;
(c)         in the case of pre-paid recorded delivery or registered post, at 10.00 a.m. (London Time) on the second Business Day following the date of posting;
(d)         in the case of email, at the time of electronic receipt,
provided that in each case where delivery by hand, fax or email occurs after 6.00 p.m. (London Time) on a Business Day or on a day which is not a Business Day, service shall be deemed to occur at 9.00 a.m. on the next following Business Day.
References to time in this Clause are to local time in the country of the addressee.
All notices shall be copied to the Master Purchaser, the Sellers, each Swiss Servicer, the German Servicer, the U.S. Servicer, the Dutch Servicer and the Cash Manager.

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8.2        The addresses, email address and fax numbers of the parties for the purpose of Clause 8.1 are as follows:

THE CURRENT SWISS SELLER, THE CURRENT SWISS SERVICER AND CHARGOR	 	 	
TRINSEO EUROPE GMBH	Address:	TrinseoEurope GmbH
Zugerstrasse 231
8810 Horgen
Switzerland	
 	Fax:	 	
 	Email:	 	
 	For the attention of:	 	
 	with a copy to:	Trinseo Senior Regional Counsel	
 	Address:	Trinseo LLC
Suite 300
1000 Chesterbrook Blvd.
Berwyn PA 19380	
 	Tel:	 	
 	Email:	 	
 	with a further copy to:	 	
 	and, if the notice or communication relates to the Styron Operating Accounts, a further copy to:	Trinseo Europe GmbH
Zugerstrasse 231
8810 Horgen
Switzerland	
THE ACCEDING SWISS SELLER, THE ACCEDING SWISS SERVICER AND THE PLEDGOR	 	 	
TRINSEO EXPORT GMBH	Address:	TrinseoEurope GmbH
Zugerstrasse 231
8810 Horgen
Switzerland	

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 	Fax:	 	
 	Email:	 	
 	For the attention of:	 	
 	with a copy to:	Trinseo Senior Regional Counsel	
 	Address:	Trinseo LLC
Suite 300
1000 Chesterbrook Blvd.
Berwyn PA 19380	
 	Tel:	 	
 	Email:	 	
 	with a further copy to:	 	
 	and, if the notice or communication relates to the Styron Operating Accounts, a further copy to:	Trinseo Europe GmbH
Zugerstrasse 231
8810 Horgen
Switzerland	
THE GERMAN SELLER AND THE GERMAN SERVICER	 	 	
TRINSEO DEUTSCHLAND ANLAGENGESELLSCHAFT MBH	Address:	c/o Trinseo Europe GmbH
Zugerstrasse 231
8810 Horgen
Switzerland	
 	Fax:	 	
 	Email:	 	
 	For the attention of:	 	

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 	with a copy to:	Trinseo Senior Regional Counsel	
 	Address:	Trinseo LLC
Suite 300
1000 Chesterbrook Blvd.
Berwyn, PA 19380	
 	Tel:	 	
 	Email:	 	
THE DUTCH SELLER AND THE DUTCH SERVICER	 	 	
TRINSEO NETHERLANDS B.V.	Address:	c/o Trinseo Europe GmbH
Zugerstrasse 231
8810 Horgen
Switzerland	
 	Fax:	 	
 	Email:	 	
 	For the attention of:	 	
 	with a copy to:	Trinseo Senior Regional Counsel	
 	Address:	Trinseo LLC
Suite 300
1000 Chesterbrook Blvd.
Berwyn, PA 19380	
 	Tel:	 	
 	Email:	 	
THE U.S. SELLER AND THE U.S. SERVICER	 	 	
TRINSEO LLC	Address:	c/o Styron Europe GmbH
Zugerstrasse 231
8810 Horgen
Switzerland	
 	Fax:	 	

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 	Email:	 	
 	For the attention of:	 	
 	with a copy to:	Trinseo Senior Regional Counsel	
 	Address:	Trinseo LLC
Suite 300
1000 Chesterbrook Blvd.
Berwyn, PA 19380	
 	Tel:	 	
 	Email:	 	
THE U.S. INTERMEDIATE TRANSFEROR	 	 	
TRINSEO U.S. RECEIVABLES COMPANY SPV LLC	Address:	c/o Trinseo Europe GmbH
Zugerstrasse 231
8810 Horgen
Switzerland	
 	Fax:	 	
 	Email:	 	
 	For the attention of:	 	
 	with a copy to:	Trinseo Senior Regional Counsel	
 	Address:	Trinseo LLC
Suite 300
1000 Chesterbrook Blvd.
Berwyn, PA 19380	
 	Tel:	 	
 	Email:	 	

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THE MASTER PURCHASER AND CHARGEE	 	 	
STYRON RECEIVABLES FUNDING DESIGNATED ACTIVITY COMPANY	Address:	3 rd Floor
Kilmore House
Park Lane
Spencer Dock
Dublin 1
Ireland	
 	Fax:	 	
 	Tel:	 	
 	Email:	 	
REGENCY NOTEHOLDER	 	 	
REGENCY ASSETS DESIGNATED ACTIVITY COMPANY	Address:	6 th Floor
Pinnacle 2
Eastpoint Business Park
Dublin 3
Ireland	
 	 	 	
 	Email:	 	
 	For the attention of:	 	
MASTER PURCHASER ACCOUNT BANK AND CASH MANAGER	 	 	
HSBC BANK PLC	Address:	8 Canada Square
London
E14 5HQ	
 	Fax:	 	
 	Tel:	 	
 	Email:	 	
 	For the attention of:	 	
 	with a copy to:	 	
 	Tel:	 	
 	Fax:	 	

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THE STYRON SECURITY TRUSTEE	 	 	
THE LAW DEBENTURE TRUST CORPORATION P.L.C.	Address:	Fifth Floor
100 Wood Street
London
EC2V 7EX	
 	Fax:	 	
 	For the attention of:	Trust Management T.C. 123441	
THE PARENT	 	 	
TRINSEO HOLDING S.À R.L	Address:	46A avenue John F. Kennedy
L-1855 Luxembourg
Grand Duchy of Luxembourg	
 	Email: 	 	
 	For the attention of:	Director	
 	with copy to:	 	
 	Address:	Trinseo Europe GmbH
Zugerstrasse 231
8810 Horgen
Switzerland	
 	Fax:	 	
 	Email:	 	
 	with a copy to:	Trinseo Senior Regional Counsel	
 	Address:	Trinseo LLC
Suite 300
1000 Chesterbrook Blvd.
Berwyn, PA 19380	
 	Tel:	 	
 	Email:	 	

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 	Address:	Trinseo Europe GmbH
Zugerstrasse 231
8810 Horgen
Switzerland	
 	Fax:	 	
THE CORPORATE ADMINISTRATOR AND REGISTRAR	 	 	
TMF ADMINISTRATION SERVICES LIMTED	Address:	3 rd Floor, Kilmore House,
Park Lane, Spencer Dock,
Dublin 1, Ireland	
 	Fax:	 	
 	For the attention of:	The Administrator	
THE INVESTMENT MANAGER AND THE STYRON NOTEHOLDER	 	 	
TRINSEO FINANCE LUXEMBOURG S.À R.L., LUXEMBOURG, SWEIGNIEDERLASSUNG HORGEN	Address:	c/o Trinseo Europe GmbH
Zugerstrasse 231
8810 Horgen
Switzerland	
 	Fax:	 	
 	Email:	 	
 	For the attention of:	 	
 	with a copy to:	Trinseo Senior Regional Counsel	
 	Address:	Trinseo LLC
Suite 300
1000 Chesterbrook Blvd.
Berwyn, PA 19380	
 	Tel:	 	
 	Email:	 	

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A party may notify any of the other parties to any of the Transaction Documents of a change to its name, relevant addressee, address, email address or fax number for the purposes of this Clause 8.2, provided that such notice shall only be effective on:
(a)         the date specified in the notice as the date on which the change is to take place; or
(b)          if no date is specified or the date specified is less than five Business Days after the date on which notice is given, the date following five Business Days after notice of any change has been given.
9.          YIELD PROTECTION INDEMNITIES
9.1        The Master Purchaser hereby agrees from time to time to indemnify the Regency Noteholder for, and to pay to it on demand, an amount equal to all amounts payable by the Regency Noteholder under and in accordance with the terms of (i) any costs, increased costs, broken funding costs or reduced rates of return incurred or suffered directly or indirectly by the Regency Noteholder of the payment of any part of any Regency Note prior to or after the maturity date thereof (including, for the avoidance of doubt relating to any Regency Noteholder Related Debt being paid prior to or after its scheduled maturity) or the failure of the Master Purchaser to issue the Regency Notes specified in the Initial Note Issue Notice or increase the principal amount of the Regency Notes as specified in an Additional Note Issue Notice; and (ii) any additional or termination cost payable to the provider of any swap, cap, collar, floor or other hedging arrangement entered into by the Regency Noteholder in connection with any regency Noteholder Related Debt (together, “ Break Costs ”) provided that such Break Costs have not arisen as a direct result of the negligence, default or recklessness of the Regency Noteholder. If the Regency Noteholder is obliged to make any payment of Break Costs then it shall in good faith use reasonable endeavours to take such reasonable steps as may reasonably be open to it to mitigate or avoid the effects of such payment of Break Costs by placing any monies received on deposit until such Regency Noteholder Related Debt is due.
9.2        If after the date hereof, the Regency Noteholder is charged any fee, expense or increased cost pursuant to any Regency Noteholder Related Debt on account of any other party to such Regency Noteholder Related Debt having determined that the adoption of any applicable law, rule or regulation regarding capital adequacy, or any change therein, or any change in the interpretation or administration thereof by any court, governmental authority, central bank or comparable agency or regulatory authority charged with the interpretation or administration thereof taking effect after the Swiss Funding Date, or compliance by such party with any guideline request or directive regarding capital adequacy (whether or not having the force of law) of any such authority, central bank or comparable agency or regulatory authority taking effect after the Swiss Funding Date (a “ Relevant Change ”), has or would have the effect of reducing the rate of return on such party’s (or its holding company’s) capital as a consequence of such party’s obligation in respect of such Regency Noteholder Related Debt, to a level below that which such party could have achieved but for such Relevant Change, then, within thirty (30) days of demand by the Regency Noteholder the Master Purchaser shall pay to the Regency Noteholder, an amount equal to each such amount charged to the Regency Noteholder pursuant to the terms of the relevant Regency Noteholder Related Debt (together, “ Increased Costs ”).  Notwithstanding anything herein to the contrary, (i) the

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Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith, (ii) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or any foreign regulatory authorities, in each case pursuant to Basel III and (iii) Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms; and Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms and any law or regulation which implements either of them, shall in each case be deemed to be a “Relevant Change,” regardless of the date enacted, adopted or issued.
9.3        Any demand made by the Regency Noteholder under Clause 9.1 or, as the case may be, Clause 9.2 shall be accompanied by a statement signed by a duly authorised signatory of the Regency Noteholder giving (to the extent that such information is within its possession and knowledge and that disclosure of such information would not involve the breach of any duty of confidentiality, the disclosure of any unpublished price sensitive information or the breach of any Requirement of Law owed by the Regency Noteholder to any other person) reasonable particulars of:
(a)         in the case of a demand under Clause 9.1, the calculation of the claim for reimbursement; and
(b)         in the case of a demand made under Clause 9.2, the Relevant Change and how the relevant amount has been calculated,
together with any supporting documentation.
Each amount certified by the Regency Noteholder as being due under this Clause 9 shall, in the absence of manifest error, be conclusive evidence of the amount so claimed.
9.4        Each party which is entitled to receive Increased Costs pursuant to Clause 9 shall, in consultation with the Master Purchaser, take all reasonable steps to mitigate any circumstances which would result in any Increased Costs becoming payable under or pursuant to Clause 9.
10.        DEFAULT INTEREST
10.1      If any sum due and payable by the Master Purchaser, the Swiss Sellers, the Dutch Seller, the Swiss Servicers or the Dutch Servicer is not paid on the due date therefor in accordance with the provisions of the relevant Transaction Documents or if any sum due and payable by the Master Purchaser, the Swiss Sellers, the Dutch Seller, the Swiss Servicers or the Dutch Servicer under any judgment or decree of any court in connection herewith is not paid on the date of such judgment or decree, the period beginning on such due date or, as the case may be, the date of such judgment or decree and ending on the date upon which the obligation of the Master Purchaser, the relevant Swiss Seller, the Dutch Seller, the relevant Swiss Servicer or the Dutch Servicer to pay such sum (the balance thereof for the time being unpaid being herein referred to as an unpaid sum) is discharged shall be divided into successive periods, each of which (other than

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the first) shall start on the last day of the preceding period and the duration of each of which shall be selected by the person to whom such sum is payable.
10.2      During each such period relating thereto as is mentioned in Clause 10.1 an unpaid sum shall bear interest at the rate per annum which is the sum of two per cent. and the London Interbank offered rate for deposits in US Dollars for the period for which such rate is to be determined which appears on the applicable Reuters screen or such other page as may replace the applicable Reuters screen at or about 11.00 a.m. provided that , if, for any such period, no such offered rate appears on such Reuters screen, the rate of interest applicable to such unpaid sum shall be the rate per annum at which HSBC Bank plc, was offering to prime banks in the London Interbank Market deposits in the currency in which such unpaid sum is denominated for the period for which such rate is to be determined.
10.3      Any interest which shall have accrued under Clause 10.2 in respect of an unpaid sum shall be due and payable and shall be paid by the Master Purchaser, the relevant Swiss Seller, the Dutch Seller, the relevant Swiss Servicer or the Dutch Servicer (as the case may be) at the end of the period by reference to which it is calculated or on such other dates as the Person to whom such sum is owed may specify by written notice to the Master Purchaser, the relevant Swiss Seller, the Dutch Seller, the relevant Swiss Servicer or the Dutch Servicer (as the case may be).
11.        SWISS SELLERS, DUTCH SELLER, SWISS SERVICERS AND DUTCH SERVICER INDEMNITIES AND UNDERTAKING BY THE MASTER PURCHASER
11.1      Indemnities by the Swiss Sellers
Without limiting any other rights that the Master Purchaser, the Regency Noteholder, the Styron Security Trustee or the Instructing Party or any of their respective Affiliates or members or any of their respective officers, directors, employees or advisors (each, an “ Indemnified Party ”) may have hereunder or under the other Transaction Documents, or under applicable law, each Swiss Seller hereby agrees to indemnify each Indemnified Party from and against any and all costs, expenses, claims, losses, damages and liabilities (including properly incurred lawyers’ fees of the Styron Security Trustee and reasonable lawyer’s fees of each other Indemnified Party of one counsel per Indemnified Party per jurisdiction) (all of the foregoing being collectively referred to as “ Indemnified Amounts ”) arising out of or resulting from the Swiss Receivables Purchase Agreement or any other Transaction Document or the use of proceeds of purchases or reinvestments or the ownership of Receivables originated by the relevant Swiss Seller or of the Notes or in respect of any Receivable originated by the relevant Swiss Seller or any Contract relating thereto, excluding, however, (a) Indemnified Amounts which have resulted from gross negligence or wilful misconduct on the part of such Indemnified Party, (b) recourse for Receivables which are not collected, not paid or uncollectible on account of the insolvency, bankruptcy or financial inability to pay of the applicable Obligor, (c) any income taxes or any other tax or fee measured by income incurred by such Indemnified Party arising out of or as a result of the Swiss Receivables Purchase Agreement or any other Transaction Document or the ownership of Receivables or Notes or in respect of any Receivable or any Contract or (d) Indemnified Amounts resulting from a breach by the Indemnified Party in respect of its obligations under any Transaction Documents. Without limiting or being limited by the

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foregoing (but subject to the exclusions contained in (a) through (d) above), each Swiss Seller shall pay on demand to each Indemnified Party without any set off, deduction, counterclaim or withholding any and all amounts necessary to indemnify such Indemnified Party from and against any and all Indemnified Amounts relating to or resulting from any of the following:
(a)          the characterisation in any Swiss Servicer Report or other written statement made by or on behalf of that Swiss Seller of any Swiss Purchased Receivable as an Eligible Receivable or as included in the Receivables Pool which, as of the date of such Swiss Servicer Report or other statement, is not an Eligible Receivable or should not be included in the Receivables Pool;
(b)          any representation or warranty or statement made or deemed made by that Swiss Seller (or any of its officers) under or in connection with any Transaction Document which shall have been incorrect in any material respect when made;
(c)          the failure by that Swiss Seller to comply with any applicable law, rule or regulation with respect to any Pool Receivable originated by the relevant Swiss Seller or the related Contracts, or the failure of any Pool Receivable originated by the relevant Swiss Seller or the related Contract to conform to any such applicable law, rule or regulation; or the failure by the relevant Swiss Seller to pay, remit or account for any taxes related to or included in a Receivable originated by the relevant Swiss Seller, when due;
(d)          the failure to vest (i) in the Master Purchaser effective title in the Swiss Purchased Receivables originated by that Swiss Seller and the Related Security and the Collections with respect to Receivables originated by the Dutch Seller free and clear of any Encumbrances other than Seller Permitted Encumbrances or (ii) in the Styron Security Trustee a first priority perfected security interest as provided in the Master Purchaser Security Documents;
(e)          the failure, when so required in accordance with the Transaction Documents, to have properly notified any Obligor of the transfer, sale or assignment of any Swiss Purchased Receivable originated by that Swiss Seller pursuant to the Transaction Documents to the extent such notice is required to perfect the same under any applicable law and for the purposes of this paragraph (e), “ perfect ” means to render actionable, publish and allow the setting up of the purchaser’s interest in, and right to collect payment under, the assets which are the subject of such transfer, sale and assignment, and to make actionable, publish and allow the setting up of such transfer, sale and assignment as against Obligors and other third parties, including any liquidator, administrator, trustee in bankruptcy or other insolvency official under any applicable law;
(f)         any dispute, claim, counterclaim, set off or defence (other than discharge in insolvency of the Obligor) of the Obligor to the payment of any Receivable  originated by that Swiss Seller in, or purporting to be in, the Receivables Pool (including a defence based on such Receivable or the related Contract not being a legal, valid and binding obligation of such Obligor enforceable against it in accordance with its terms), or any other claim whether of the Obligor or any third party resulting from the sale of chemical products related to such Receivable or the furnishing or failure to furnish such merchandise or services

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or relating to collection activities with respect to such Receivable (if such collection activities were performed by that Swiss Seller or any of its Affiliates acting as Swiss Servicer);
(g)          any failure of that Swiss Seller to perform its duties or obligations under the Contracts;
(h)          any product liability, property damage, personal injury, consequential loss or other claim arising out of or in connection with the chemical products which are the subject of any Contract of that Swiss Seller;
(i)           the commingling of Collections of Purchased Receivables originated by that Swiss Seller at any time with other funds;
(j)           any investigation, litigation or proceeding related to the Swiss Receivables Purchase Agreement or any other Transaction Document or the use of proceeds of purchases or reinvestments or the ownership of Receivables originated by that Swiss Seller or Notes or in respect of any Receivable originated by that Swiss Seller or Related Security or any Contract relating thereto (including in connection with the preparation of a defence or appearing as a third party witness in connection therewith and regardless of whether such investigation, litigation or proceeding is brought by that Swiss Seller, an Indemnified Party or any other Person or an Indemnified Party is otherwise a party thereto);
(k)          any failure of that Swiss Seller to comply with its covenants contained in this Deed or any other Transaction Document;
(l)           any claim brought by any Person other than an Indemnified Party arising from any activity by that Swiss Seller or any agent or delegate of that Swiss Seller in servicing, administering or collecting any Swiss Purchased Receivable; and
(m)         any claim arising out of any failure by that Swiss Seller to obtain a consent from the relevant Obligor to the transfer, sale or assignment of any Receivable originated by that Swiss Seller pursuant to the Transaction Documents.
If any event occurs in respect of which indemnification may be sought from a Swiss Seller, the Indemnified Party shall (in each case to the extent it is lawful to do so) notify in writing and consult with the relevant Swiss Seller within a reasonable time after the relevant Indemnified Party becomes aware of such event.
11.2      Indemnities by the Swiss Servicers
Without limiting any other rights that the Master Purchaser, the Regency Noteholder, the Styron Security Trustee or the Instructing Party or any of their respective Affiliates or members or any of their respective officers, directors, employees or advisors (each, a “ Special Indemnified Party ”) may have hereunder or under applicable law, and in consideration of its appointment as a Swiss Servicer under the Swiss Servicing Agreement, each Swiss Servicer hereby agrees to indemnify each Special Indemnified Party from and against any and all claims, losses and liabilities (including properly incurred lawyers’ fees of the Styron Security Trustee and reasonable lawyer’s fees of each other Special Indemnified Party of one counsel per Special Indemnified Party per

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jurisdiction) (all of the foregoing being collectively referred to as “ Special Indemnified Amounts ”) arising out of or resulting from any of the following (excluding, however, (a) Special Indemnified Amounts to have resulted from gross negligence or wilful misconduct on the part of such Special Indemnified Party, (b) recourse for Receivables which are not collected, not paid or uncollectible on account of the insolvency, bankruptcy or financial inability to pay of the applicable Obligor, (c) any income taxes or any other tax or fee measured by income incurred by such Special Indemnified Party arising out of or as a result of this Deed or any other Transaction Document or the ownership of Receivables or Notes or in respect of any Receivable or any Contract, or (d) Special Indemnified Amounts resulting from a breach by the Special Indemnified Party in respect of its obligations under any Transaction Documents):
(a)          any representation made or deemed made by that Swiss Servicer pursuant to the Swiss Agreement or any other Transaction Document which shall have been incorrect in any respect when made or any other representation or warranty or statement made or deemed made by that Swiss Servicer under or in connection with the Swiss Servicing Agreement or any other Transaction Document which shall have been incorrect in any material respect when made;
(b)          the failure by that Swiss Servicer to comply with any applicable law, rule or regulation with respect to any Swiss Purchased Receivable or Contract;
(c)          any failure of that Swiss Servicer to perform its duties or obligations in accordance with the provisions of the Swiss Servicing Agreement or any other Transaction Document;
(d)          the commingling of Collections of Swiss Purchased Receivables at any time by that Swiss Servicer with other funds;
(e)          any breach of an obligation of that Swiss Servicer reducing or impairing the rights of the Master Purchaser, the Regency Noteholder, the Styron Security Trustee or the Instructing Party with respect to any Pool Receivable or the value of any Pool Receivable;
(f)         any Swiss Servicer Fees or other costs and expenses payable to any replacement Swiss Servicer, to the extent in excess of the Swiss Servicer Fees payable to that Swiss Servicer pursuant to the Swiss Servicing Agreement; or
(g)          payment of any claim brought by any Person other than a Special Indemnified Party arising from any activity by that Swiss Servicer or its Affiliates in servicing, administering or collecting any Swiss Purchased Receivable.
If any event occurs in respect of which indemnification may be sought from a Swiss Servicer, the Special Indemnified Party shall (in each case to the extent it is lawful to do so) notify in writing and consult with the relevant Swiss Servicer within a reasonable time after the relevant Special Indemnified Party becomes aware of such event.
11.3      Indemnities by the Dutch Seller
Without limiting any other rights that the Indemnified Parties may have hereunder or under the other Transaction Documents, or under applicable law, the Dutch Seller

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hereby agrees to indemnify each Indemnified Party from and against any Indemnified Amounts arising out of or resulting from the Dutch Receivables Purchase Agreement or any other Transaction Document or the use of proceeds of purchases or reinvestments or the ownership of Receivables originated by the Dutch Seller or of the Notes or in respect of any Receivable originated by the Dutch Seller or any Contract relating thereto excluding, however, (a) Indemnified Amounts which have resulted from gross negligence or wilful misconduct on the part of such Indemnified Party, (b) recourse for Receivables which are not collected, not paid or uncollectible on account of the insolvency, bankruptcy or financial inability to pay of the applicable Obligor, (c) any income taxes or any other tax or fee measured by income incurred by such Indemnified Party arising out of or as a result of the Dutch Receivables Purchase Agreement or any other Transaction Document or the ownership of Receivables or Notes or in respect of any Receivable or any Contract or (d) Indemnified Amounts resulting from a breach by the Indemnified Party in respect of its obligations under any Transaction Documents. Without limiting or being limited by the foregoing (but subject to the exclusions contained in (a) through (d) above), the Dutch Seller shall pay on demand to each Indemnified Party without any set off, deduction, counterclaim or withholding any and all amounts necessary to indemnify such Indemnified Party from and against any and all Indemnified Amounts relating to or resulting from any of the following:
(a)          the characterisation in any Dutch Servicer Report or other written statement made by or on behalf of the Dutch Seller of any Dutch Purchased Receivable as an Eligible Receivable or as included in the Receivables Pool which, as of the date of such Dutch Servicer Report or other statement, is not an Eligible Receivable or should not be included in the Receivables Pool;
(b)          any representation or warranty or statement made or deemed made by the Dutch Seller (or any of its officers) under or in connection with any Transaction Document which shall have been incorrect in any material respect when made;
(c)          the failure by the Dutch Seller to comply with any applicable law, rule or regulation with respect to any Pool Receivable originated by the Dutch Seller or the related Contracts, or the failure of any Pool Receivable originated by the Dutch Seller or the related Contract to conform to any such applicable law, rule or regulation; or the failure by the Dutch Seller to pay, remit or account for any taxes related to or included in a Receivable originated by the Dutch Seller, when due;
(d)          the failure to vest (i) in the Master Purchaser effective title in the Receivables originated by the Dutch Seller and the Related Security and the Collections with respect to Receivables originated by the Dutch Seller free and clear of any Encumbrances other than Seller Permitted Encumbrances or (ii) in the Styron Security Trustee a first priority perfected security interest as provided in the Master Purchase Security Documents;
(e)          the failure, when so required in accordance with the Transaction Documents, to have properly notified any Obligor of the transfer, sale or assignment of any Dutch Purchased Receivable originated by the Dutch Seller pursuant to the Transaction Documents to the extent such notice is required to perfect the same under any applicable law and for the purposes of this paragraph (e), “ perfect ” shall have the same meaning as in Clause 11.1(e) above;

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(f)         any dispute, claim, counterclaim, set off or defence (other than discharge in insolvency of the Obligor) of the Obligor to the payment of any Receivable originated by the Dutch Seller in, or purporting to be in, the Receivables Pool (including a defence based on such Receivable or the related Contract not being a legal, valid and binding obligation of such Obligor enforceable against it in accordance with its terms), or any other claim whether of the Obligor or any third party resulting from the sale of chemical products related to such Receivable or the furnishing or failure to furnish such merchandise or services or relating to collection activities with respect to such Receivable (if such collection activities were performed by the Dutch Seller or any of its Affiliates acting as Dutch Servicer);
(g)         any failure of the Dutch Seller to perform its duties or obligations under the Contracts;
(h)         any product liability, property damage, personal injury, consequential loss or other claim arising out of or in connection with the chemical products which are the subject of any Contract of the Dutch Seller;
(i)           the commingling of Collections of Purchased Receivables originated by the Dutch Seller at any time with other funds;
(j)           any investigation, litigation or proceeding related to the Dutch Receivables Purchase Agreement or any other Transaction Document or the use of proceeds of purchases or reinvestments or the ownership of Receivables originated by the Dutch Seller or Notes or in respect of any Receivable originated by the Dutch Seller or Related Security or any Contract relating thereto (including in connection with the preparation of a defence or appearing as a third party witness in connection therewith and regardless of whether such investigation, litigation or proceeding is brought by the Dutch Seller, an Indemnified Party or any other Person or an Indemnified Party is otherwise a party thereto);
(k)          any failure of the Dutch Seller to comply with its covenants contained in this Deed or any other Transaction Document;
(l)           any claim brought by any Person other than an Indemnified Party arising from any activity by the Dutch Seller or any agent or delegate of the Dutch Seller in servicing, administering or collecting any Dutch Purchased Receivable; and
(m)         any claim arising out of any failure by the Dutch Seller to obtain a consent from the relevant Obligor to the transfer, sale or assignment of any Receivable originated by the Dutch Seller pursuant to the Transaction Documents.
If any event occurs in respect of which indemnification may be sought from the Dutch Seller, the Indemnified Party shall (in each case to the extent it is lawful to do so) notify in writing and consult with the Dutch Seller within a reasonable time after the relevant Indemnified Party becomes aware of such event.

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11.4      Indemnities by the Dutch Servicer
Without limiting any other rights that the Special Indemnified Parties may have hereunder or under applicable law, and in consideration of its appointment as Dutch Servicer under the Dutch Servicing Agreement, the Dutch Servicer hereby agrees to indemnify each Special Indemnified Party from and against any and all Special Indemnified Amounts arising out of or resulting from any of the following (excluding, however, (a) Special Indemnified Amounts to have resulted from gross negligence or wilful misconduct on the part of such Special Indemnified Party, (b) recourse for Receivables which are not collected, not paid or uncollectible on account of the insolvency, bankruptcy or financial inability to pay of the applicable Obligor, (c) any income taxes or any other tax or fee measured by income incurred by such Special Indemnified Party arising out of or as a result of this Deed or any other Transaction Document or the ownership of Receivables or Notes or in respect of any Receivable or any Contract, or (d) Special Indemnified Amounts resulting from a breach by the Special Indemnified Party in respect of its obligations under any Transaction Documents):
(a)          any representation made or deemed made by the Dutch Servicer pursuant to the Dutch Servicing Agreement or any other Transaction Document which shall have been incorrect in any respect when made or any other representation or warranty or statement made or deemed made by the Dutch Servicer under or in connection with the Dutch Servicing Agreement or any other Transaction Document which shall have been incorrect in any material respect when made;
(b)          the failure by the Dutch Servicer to comply with any applicable law, rule or regulation with respect to any Dutch Purchased Receivable or Contract;
(c)          any failure of the Dutch Servicer to perform its duties or obligations in accordance with the provisions of the Dutch Servicing Agreement or any other Transaction Document;
(d)          the commingling of Collections of Dutch Purchased Receivables at any time by the Dutch Servicer with other funds;
(e)          any breach of an obligation of the Dutch Servicer reducing or impairing the rights of the Master Purchaser, the Regency Noteholder, the Styron Security Trustee or the Instructing Party with respect to any Pool Receivable or the value of any Pool Receivable;
(f)         any Dutch Servicer Fees or other costs and expenses payable to any replacement Dutch Servicer, to the extent in excess of the Dutch Servicer Fees payable to the Dutch Servicer pursuant to the Dutch Servicing Agreement; or
(g)          payment of any claim brought by any Person other than a Special Indemnified Party arising from any activity by the Dutch Servicer or its Affiliates in servicing, administering or collecting any Receivable.
If any event occurs in respect of which indemnification may be sought from the Dutch Servicer, the Special Indemnified Party shall (in each case to the extent it is lawful to do so) notify in writing and consult with the Dutch Servicer within a reasonable time after the relevant Special Indemnified Party becomes aware of such event.

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12.        FEES, COSTS, EXPENSES AND TAXATION
12.1      Fees
(a)         The Sellers (or the Investment Manager on their behalf) shall on the earlier to occur of the U.S. Funding Date or the Dutch Funding Date pay to HSBC Bank plc, a structuring and commitment fee in the amount specified in the Fee Letter together with all other costs and expenses (including reasonable legal costs and expenses) referred to in the Fee Letter (the “ Funding Date Fees and Expenses ”).
(b)         All invoices submitted to any Seller under this Clause 12 shall be in reasonable detail.
(c)         If any Seller does not pay any of the fees referred to in paragraphs (a) or (b) of Clause 12.1 and paragraph (a) of Clause 12.2, the Master Purchaser hereby undertakes that it shall pay such fees to HSBC Bank plc or the Regency Noteholder (as the case may be) to the extent that they have not been paid by a Seller.
12.2      Costs and Expenses in relation to the Swiss Sellers and the Swiss Servicers
Without prejudice to the provisions of the other Transaction Documents, each Swiss Seller and each Swiss Servicer shall on demand pay by way of indemnity on a gross of Tax basis all, claims, liabilities, losses, damages suffered by and all costs, fees and expenses (including legal expenses) (i) incurred by (provided in the case of paragraphs (a), (c) and (d) below such costs, fees and expenses are reasonably incurred) the Master Purchaser and the Regency Noteholder and (ii) incurred or chargeable by (provided in the case of paragraphs (a), (c) and (d) below such costs, fees and expenses are properly incurred) the Styron Security Trustee in connection with:
(a)          any variation, consent or approval, or any steps taken with a view to any variation, consent or approval, in each case relating to or in connection with any of the Transaction Documents or any related document which was requested by or required by that Swiss Seller or that Swiss Servicer;
(b)          the preservation or enforcement of, or any action taken to preserve or enforce, any of their rights under any of the Transaction Documents or any related documents;
(c)          the exercise by the Master Purchaser, the Regency Noteholder, the Styron Security Trustee, or the Instructing Party of its rights to monitor compliance by that Swiss Seller or that Swiss Servicer with its obligations under the Transaction Documents; and
(d)          any audit by any such party or any relevant auditors in relation to transaction cash flows, the performance of the Purchased Receivables originated by that Swiss Seller, Collections with respect to Receivables originated by that Swiss Seller and procedures relating to such Collections,
and (for the avoidance of doubt) the relevant Swiss Seller or Swiss Servicer shall pay to the Master Purchaser, the Regency Noteholder and the Styron Security Trustee, as

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appropriate, such amount as shall represent any value added tax, sales tax, purchase tax or other similar taxes or duties associated with such costs, fees and expenses (if any) howsoever charged to, or suffered by, the Master Purchaser, the Regency Noteholder and the Styron Security Trustee (other than any Tax on the net income of the Master Purchaser, the Regency Noteholder and the Styron Security Trustee).
12.3      Costs and Expenses in relation to the Dutch Seller and the Dutch Servicer
Without prejudice to the provisions of the other Transaction Documents, the Dutch Seller and the Dutch Servicer shall on demand pay by way of indemnity on a gross of Tax basis all, claims, liabilities, losses, damages suffered by and all costs, fees and expenses (including legal expenses) (i) incurred by (provided in the case of paragraphs (a), (c) and (d) below such costs, fees and expenses are reasonably incurred) the Master Purchaser and the Regency Noteholder and (ii) incurred or chargeable by (provided in the case of paragraphs (a), (c) and (d) below such costs, fees and expenses are properly incurred) the Styron Security Trustee in connection with:
(a)          any variation, consent or approval, or any steps taken with a view to any variation, consent or approval, in each case relating to or in connection with any of the Transaction Documents or any related document which was requested by or required by the Dutch Seller or the Dutch Servicer;
(b)          the preservation or enforcement of, or any action taken to preserve or enforce, any of their rights under any of the Transaction Documents or any related documents;
(c)          the exercise by the Master Purchaser, the Regency Noteholder, the Styron Security Trustee, or the Instructing Party of its rights to monitor compliance by the Dutch Seller or the Dutch Servicer with its obligations under the Transaction Documents; and
(d)          any audit by any such party or any relevant auditors in relation to transaction cash flows, the performance of the Purchased Receivables originated by the Dutch Seller, Collections with respect to Receivables originated by the Dutch Seller and procedures relating to such Collections,
and (for the avoidance of doubt) the Dutch Seller and the Dutch Servicer shall pay to the Master Purchaser, the Regency Noteholder and the Styron Security Trustee, as appropriate, such amount as shall represent any value added tax, sales tax, purchase tax or other similar taxes or duties associated with such costs, fees and expenses (if any) howsoever charged to, or suffered by, the Master Purchaser, the Regency Noteholder and the Styron Security Trustee (other than any Tax on the net income of the Master Purchaser, the Regency Noteholder and the Styron Security Trustee.
12.4      Duties and Taxes
Without prejudice to the provisions of the other Transaction Documents, each Swiss Seller or the Dutch Seller or all of them jointly and severally (as applicable) shall pay any stamp, documentary, transfer, excise, registration, filing and other similar duties, levies, fees or Taxes to which:

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(a)         any of the Relevant Transaction Documents or any related documents; or
(b)          any purchase of Receivables from a Swiss Seller under the Swiss Receivables Purchase Agreement or from the Dutch Seller under the Dutch Receivables Purchase Agreement (as applicable); or
(c)          any transaction contemplated under the Transaction Documents and the related documents including the assignment, release, resale or re-assignment of any Receivable originated by that Seller; or
(d)         the enforcement of the rights of the Master Purchaser, the Regency Noteholder and the Styron Security Trustee,
may be subject or give rise and each Swiss Seller or the Dutch Seller or all of them jointly and severally (as applicable) shall fully indemnify the Master Purchaser, the Regency Noteholder and the Styron Security Trustee, on a gross of Tax basis, from and against any losses or liabilities which any of them may properly incur or otherwise suffer as a result of any delay in paying or omission to pay such duties, levies, fees or taxes (other than any Tax on the net income of the Master Purchaser, the Regency Noteholder and the Styron Security Trustee).  The indemnities specified in paragraphs (a), (b) and (d) above shall be given by each applicable Seller with respect to the Receivables which it has originated and the Transaction Documents to which it is a party.  The indemnities specified in paragraphs (a), (c) and (d) above shall be given by both Sellers on a joint and several basis with respect to the Transaction Documents to which both are parties or neither of them are parties.
12.5      Value Added and Sales Tax
(a)         Any amounts stated in any Relevant Transaction Document to be payable, or payable in connection with any Relevant Transaction Document, by a Swiss Seller, the Dutch Seller, a Swiss Servicer or the Dutch Servicer are exclusive of value added tax, sales tax, purchase tax or other similar taxes or duties and accordingly, to the extent that any such taxes arise in respect of such payments, such Swiss Seller, the Dutch Seller, such Swiss Servicer, or the Dutch Servicer (as the case may be) shall, in addition, pay any amount properly charged in respect of any such taxes or duties.
(b)         Any amounts stated in any Relevant Transaction Document to be payable by the Master Purchaser, the Regency Noteholder and the Styron Security Trustee are unless otherwise expressly provided in any Relevant Transaction Document exclusive of value added tax, sales tax, purchase tax or other similar taxes or duties.
12.6      Grossing-Up
(a)         All payments made by a Swiss Seller, the Dutch Seller, a Swiss Servicer or the Dutch Servicer to the Master Purchaser, the Regency Noteholder, the Styron Security Trustee, and the Instructing Party under or in connection with any Relevant Transaction Document shall be made in full without any deduction or withholding in respect of Taxes (or otherwise) unless the deduction or

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withholding is required by law in which event such Swiss Seller, the Dutch Seller, such Swiss Servicer or the Dutch Servicer (as applicable) shall:
(i)          ensure that the deduction or withholding does not exceed the minimum amount legally required; and
(ii)        forthwith pay to the Master Purchaser, the Regency Noteholder, the Styron Security Trustee, or the Instructing Party such additional amount (other than any Tax on the net profit of the Master Purchaser, the Regency Noteholder, the Styron Security Trustee, or the Instructing Party) so that the net amount received by the Master Purchaser, the Regency Noteholder, the Styron Security Trustee, or the Instructing Party as the case may be, will equal the full amount which would have been received by it had no such deduction or withholding been made. For the purposes of Swiss withholding taxes this clause shall be read to mean that the payment obligations of the relevant Swiss Seller stated in any Transaction Document are minimum payment obligations net of any mandatory reduction on account of Swiss withholding taxes and the corresponding amount of Swiss withholding tax (based on the increased amount) is remitted by such Swiss Seller to the tax authority.
(b)          Each Swiss Seller and each Swiss Servicer hereby undertakes to indemnify the Master Purchaser, the Regency Noteholder, the Styron Security Trustee and the Instructing Party, in respect of any withholding or deduction on account of Tax on the payment of any amount due in respect of any Purchased Receivable originated by the relevant Swiss Seller or otherwise due under any Relevant Transaction Document such that the Master Purchaser, the Regency Noteholder, the Styron Security Trustee and the Instructing Party, as the case may be, receives the same amount that it would have received had there been no such withholding or deduction.
(c)          The Dutch Seller and the Dutch Servicer hereby undertake to indemnify the Master Purchaser, the Styron Security Trustee and the Instructing Party, in respect of any withholding or deduction on account of Tax on the payment of any amount due in respect of any Purchased Receivable originated by the Dutch Seller or otherwise due under any Relevant Transaction Document such that the Master Purchaser, the Styron Security Trustee and the Instructing Party, as the case may be, receives the same amount that it would have received had there been no such withholding or deduction.
(d)          All payments made to a Swiss Seller, the Dutch Seller, a Swiss Servicer or the Dutch Servicer by the Master Purchaser, the Regency Noteholder, the Styron Security Trustee or the Instructing Party under or in connection with any Relevant Transaction Document shall be made in full without any deduction or withholding in respect of Taxes (or otherwise) unless the deduction or withholding is required by law in which event the Master Purchaser, the Regency Noteholder, the Styron Security Trustee or the Instructing Party, as the case may be, shall ensure that the deduction or withholding does not exceed the minimum amount legally required. For the avoidance of doubt, save as otherwise expressly provided in any Relevant Transaction Document none of the Master Purchaser, the Regency Noteholder, the Styron Security Trustee or

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the Instructing Party shall be obliged to gross up any such payment following any such deduction or withholding.
12.7      Tax Credits
If any of the Swiss Sellers, the Dutch Seller, the Swiss Servicers or the Dutch Servicer pays any additional amount (an “ Additional Payment ”) under paragraph (a) of Clause 12.5 and the Master Purchaser, the Regency Noteholder, the Styron Security Trustee, or the Instructing Party, as the case may be, effectively obtains a refund of Tax or credit against Tax on its overall net income by reason of that Additional Payment (a “ Tax Credit ”) and the Master Purchaser, the Regency Noteholder, the Styron Security Trustee or the Instructing Party, as the case may be, is able to identify such Tax Credit as being attributable to such Additional Payment, then the Master Purchaser, the Regency Noteholder, the Styron Security Trustee or the Instructing Party, as the case may be, shall reimburse the relevant Swiss Seller, the Dutch Seller, the relevant Swiss Servicer or the Dutch Servicer (as the case may be) such amount as the Master Purchaser, the Regency Noteholder, the Styron Security Trustee or the Instructing Party, as the case may be, shall determine to be the proportion of such Tax Credit as will leave it, after that reimbursement, in no better or worse position than it would have been in if that Additional Payment had not been required. The Master Purchaser, the Regency Noteholder, the Styron Security Trustee or the Instructing Party, as the case may be, shall use reasonable efforts to claim any Tax Credit and, if it does so claim, shall have absolute discretion as to the extent, order and manner in which it does so but shall in no circumstances be liable to any of the Swiss Sellers, the Dutch Seller, the Swiss Servicers or the Dutch Servicer for not doing so.
12.8      After Tax Amount
In the event that any taxing authority seeks to charge to Tax any sum paid to the Master Purchaser, the Regency Noteholder, the Styron Security Trustee or the Instructing Party as a result of the indemnities contained herein then the amount so payable shall be grossed up by such amount as to ensure that after payment of the Tax so charged (and taking account of the Tax effect of any loss giving rise to the right to such an indemnity) there shall be left a sum equal to the amount that would otherwise be payable under such indemnity or obligation.
12.9.   Notwithstanding anything else to the contrary in any Transaction Document, none of the U.S. Seller, U.S. Servicer, U.S. Intermediate Transferor, Swiss Sellers, Swiss Servicers and Chargor, German Seller, German Servicer, Dutch Seller, Dutch Servicer, Parent, Guarantor, the Styron Security Trustee or the Master Purchaser shall be required to pay any additional amounts, gross-up, indemnity payment or other similar amount with respect to any Tax imposed under the laws of the United States that is an Excluded Tax, as such term is defined in the U.S. Intermediate Transfer Agreement.
13.        WAIVERS; REMEDIES CUMULATIVE
13.1      No failure or delay by any party hereto in exercising any right, power or privilege under any Transaction Document to which it is a party or available at law shall impair such right, power or remedy or operate as a waiver thereof. The single or partial exercise of any right, power or remedy under this Deed or any Transaction Document to which it is a party or at law shall not preclude any other or further exercise thereof or the exercise

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of any other right, power or remedy under this Deed or any Transaction Document to which it is a party or at law.
13.2      The rights of any party to any Transaction Document shall not be capable of being waived otherwise than by an express waiver in writing or by a waiver in such other form as may be agreed by the parties to the relevant Transaction Document for the purposes of minimising or avoiding liability to stamp tax.
13.3      The rights, powers and remedies provided in this Deed and any Transaction Document to which it is a party are cumulative and may be exercised as often as they are considered appropriate and are in addition to any rights and remedies provided by law.
14.        APPOINTMENT OF PARENT BY SELLER AND SERVICER PARTIES; MODIFICATION AND WAIVER
14.1      Each Swiss Seller, each Swiss Servicer, the Pledgor, the German Seller, the German Servicer, the Dutch Seller, the Dutch Servicer, the U.S. Seller, the U.S. Servicer, the Investment Manager, the Styron Noteholder (collectively the “ Seller and Servicer Parties ” and each a “ Seller and Servicer Party ”) by its execution of this Deed irrevocably appoints the Parent (acting through one or more authorised signatories) to act on its behalf as its agent in relation to the Transaction Documents and irrevocably authorises:
(a)          the Parent on its behalf to supply all information concerning itself contemplated by the Transaction Documents and to give all notices and instructions, to make such agreements and to effect the relevant amendments, supplements and variations capable of being given, made or effected by any Seller and Servicer Party notwithstanding that they may affect the relevant Seller and Servicer Party, without further reference to or the consent of that Seller and Servicer Party;
(b)          each other party to this Deed to give any notice, demand or other communication to that Seller and Servicer Party pursuant to the Transaction Documents to the Parent;
(c)          where the Parent takes any action under sub-paragraph (a) above (other than the provision of information) it shall procure that each relevant Seller and Servicer Party provides a Solvency Certificate in form and substance satisfactory to the Cash Manager in relation thereto,
(d)          each of the Seller and Servicer Parties (other than the Investment Manager and Styron Noteholder) agrees that it shall not revoke the appointment of the Parent to take the action specified in sub-paragraph (a) above in any circumstances,
and in each case the Seller and Servicer Party shall be bound as though the Seller and Servicer Party itself had given the notices and instructions or executed or made the agreements or effected the amendments, supplements or variations, or received the relevant notice, demand or other communication.

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The Investment Manager and Styron Noteholder may, with 30 Business Days prior written notice to the Parent and each other Party hereto, revoke the appointment of the Parent to take any action under sub-paragraph (a) above (other than the provision of information).
For the purpose of this Clause 14.1 each “Seller and Servicer Party” releases the Parent from the restrictions under Section 181 German Civil Code ( Bürgerliches Gesetzbuch – BGB ).
14.2      Every act, omission, agreement, undertaking, settlement, waiver, amendment, supplement, variation, notice or other communication given or made by the Seller and Servicer Party Agent or given to the Seller and Servicer Party Agent under any Transaction Document on behalf of another Seller and Servicer Party or in connection with any Transaction Document (whether or not known to any other Seller and Servicer Party and whether occurring before or after such other Seller and Servicer Party became a Seller and Servicer Party under any Transaction Document) shall be binding for all purposes on that Seller and Servicer Party as if that Seller and Servicer Party had expressly made, given or concurred with it. In the event of any conflict between any notices or other communications of the Seller and Servicer Party Agent and any other Seller and Servicer Party, those of the Seller and Servicer Party Agent shall prevail.
14.3      Unless otherwise specified in the Styron Security Deed, no amendment, modification, waiver or variation of any or all of the Transaction Documents shall be effective unless:
(a)          it is in writing and signed by or on behalf of the Parent as Seller and Servicer Party Agent on behalf of each of the Seller and Servicer Parties and each other party to the relevant Transaction Document to be so modified, waived or varied or initialled for identification on behalf of such parties or in such other form as may be agreed by the parties to the relevant Transaction Document for the purposes of minimising or avoiding any liability to stamp tax; and
(b)         such amendment, modification, waiver or variation complies with the requirements of clause 29 of the Styron Security Deed.
14.4      The Master Purchaser agrees with the Sellers that the Sellers may request an increase in the Facility Limit from time to time and the Master Purchaser shall, subject to conditions to be agreed, use its commercially reasonable endeavours to agree to such increases with the Regency Noteholder and the Styron Noteholder (subject to the credit and business approval processes of the Liquidity Facility Provider) and shall not require any increase in the fees on such additional amounts from the fee levels set out in the Transaction Documents or any increase in the CP Rate or Reuters Screen Rate from that set out above or any other alteration to the terms in a manner that is or could be reasonably expected to be adverse to any Seller.
15.        ENTIRE AGREEMENT
Each and every Transaction Document sets out the entire agreement and understanding between the parties in respect of the subject matter of the agreements contained therein and supersedes any previous agreement between the parties relating to the subject matter therein. It is agreed that:

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(a)          no party has entered into any Transaction Document in reliance upon any representation, warranty or undertaking of any other party which is not expressly set out or referred to in any such Transaction Document;
(b)          except for breach of an express representation or warranty under any Transaction Document no party shall have any claim or remedy under any of the Transaction Documents in respect of misrepresentation (whether negligent or otherwise, and whether made prior to or at the time of execution of the Transaction Documents) or untrue statement made by any other party; and
(c)          this Clause shall not exclude any liability for fraudulent misrepresentation.
16.        NO LIABILITY
Notwithstanding any other provision of this Deed or any other Transaction Document, no recourse under any obligation, covenant, or agreement of any party (acting in any capacity whatsoever) contained in any Transaction Document shall be had against any shareholder, officer, director, employee or agent of the Master Purchaser or the Regency Noteholder or the Styron Security Trustee as such, by the enforcement of any assessment or by any proceeding, by virtue of any statute or otherwise, it being expressly agreed and understood that each Transaction Document is a corporate obligation of the relevant party and no personal liability shall attach to or be incurred by the shareholders, officers, agents, employees or directors of any party as such, or any of them, under or by reason of any of the obligations, covenants or agreements contained in any Transaction Document, or implied therefore, and that any and all personal liability for breaches by such party of any such obligations, covenants or agreements, either at law or by statute or constitution, of every such shareholder, officer, agent, employee or director is hereby expressly waived by the other parties as a condition of and consideration for the execution of this Deed.
17.        LIMITED RECOURSE AND NON-PETITION IN FAVOUR OF REGENCY NOTEHOLDER
17.1      Notwithstanding any other provision of this Deed, each of the parties hereto (other than the German Seller and the German Servicer) hereby agrees with the Regency Noteholder that it shall not, until the expiry of two years and one day after payment of all sums outstanding and owing under the latest maturing commercial paper notes issued by the Regency Noteholder pursuant to its Programme Documents (as defined below):
(a)          take any corporate action or other steps or legal proceedings for the winding- up, dissolution, examinership or re-organisation of or for the appointment of a receiver, administrator, administrative receiver, trustee, liquidator, examiner, sequestrator or similar officer to the Regency Noteholder or of any or all its revenues and assets; or
(b)          have any right to take any steps for the purpose of obtaining payment of any amounts payable to it under this Deed by the Regency Noteholder and shall not take any steps to recover any debts whatsoever owing to it by the Regency Noteholder.

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17.2      Notwithstanding any other provision of this Deed, each party hereto (other than the Regency Noteholder, the German Seller and the German Servicer) agrees and acknowledges with the Regency Noteholder that:
(a)          it will only have recourse in respect of any amount, claim or obligation due or owing to it by the Regency Noteholder (the “ Claims ”) to the extent of available funds pursuant to the Regency Noteholder’s programme documents in respect of its USD$20,000,000,000 asset-backed commercial paper notes issuance programme (the “ Programme Documents ”) subject to and in accordance with the terms thereof and after all other prior ranking claims in respect thereof have been satisfied and discharged in full;
(b)          following the application of funds following enforcement of the security interests created over the Regency Noteholder’s assets under the relevant Programme Documents, subject to and in accordance with the provisions relating to the application of funds specified therein, the Regency Noteholder will have no assets available for payment of its obligations under such documents and this Deed other than as provided for pursuant to the Programme Documents and any Claims will accordingly be extinguished to the extent of any shortfall; and
(c)          the obligations of the Regency Noteholder under the Programme Documents and this Deed will not be obligations or responsibilities of, or guaranteed by, any other person or entity.
17.3      Notwithstanding any other provision of this Deed no recourse under any obligation, covenant or agreement of the Regency Noteholder contained in this Deed shall be had against any shareholder, member, officer, director, employee or agent of the Regency Noteholder, by the enforcement of any assessment or by any legal proceeding, by virtue of any statute or otherwise; it being expressly agreed and understood that this Deed is a corporate obligation of the Regency Noteholder, and that no personal liability shall attach to or be incurred by the shareholders, members, officers, directors, employees or agents of the Regency Noteholder , as such, or any of them under or by reason of any of the obligations, covenants or agreements of the Regency Noteholder contained in this Deed or implied therefrom and that any and all personal liability for breaches by the Regency Noteholder of any of such obligations, covenants or agreements, either at any applicable law or by statute or constitution of every such shareholder, member, officer, director, employee or agent is hereby expressly waived as a condition of and in consideration for the execution of this Deed.
17.4      Notwithstanding any other provision of this Deed or any Transaction Document, each of the parties hereto (other than the German Seller and the German Servicer) agrees and acknowledges that the provisions of Clauses 16 and 17 of this Deed shall survive and shall not be extinguished by the termination of this Deed and shall continue to bind the parties thereafter.
17.5      For the avoidance of doubt, Clause 22 ( Limited Recourse and No-Petition in Favour of Regency Noteholders ) of the German Receivables Purchase Agreement binds the German Seller and Clause 1.4(h) of the German Servicing Agreement binds the German Servicer.

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18.        MISCELLANEOUS PROVISIONS
18.1      Evidence of indebtedness
In any proceeding, action or claim relating to any Transaction Document a statement as to any amount due which is certified as being correct by an officer of the Instructing Party, shall, unless otherwise provided in the Transaction Document or this Deed, or in the case of manifest error, be prima facie evidence that such amount is in fact due and payable.
18.2      Severability
Any provision of any Transaction Document or this Deed which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. To the extent permitted by applicable law, each of the parties hereto hereby waives any provision of law but only to the extent permitted by law which renders any provision of any Transaction Document prohibited or unenforceable in any respect.
18.3      Assignability
(a)          Save as specifically provided in any Transaction Document and subject to sub-paragraph 18.3(b) below, none of the Swiss Sellers, the German Seller, the Dutch Seller, the German Servicer, the Dutch Servicer, the Swiss Servicers, Regency Noteholder or the Master Purchaser shall be entitled to assign any of its rights or transfer any of its obligations under any of the Transaction Documents without the prior written consent of the Cash Manager, and prior written notice being given to Moody’s and S&P.
(b)          The Regency Noteholder may assign its rights or transfer its obligations under the Transaction Documents to any person subject to obtaining the prior written consent of the Parent (in its sole discretion) provided that the consent of the Parent shall not be required in respect of assignments or transfer (i) to Affiliates provided such arrangement or transfer shall not increase the Master Purchaser’s cost of funding, (ii) following a Termination Event which has occurred and which is continuing or (iii) to HSBC Bank plc or its Affiliates.
(c)          Each assignor or transferor shall notify the Cash Manager and the Parent of any assignment or transfer under paragraph (a) or paragraph (b) of Clause 18.3. Each assignor or transferor may, in connection with any such assignment or transfer, disclose to the assignee or transferee or potential assignee or transferee any information relating to the relevant Swiss Seller, the German Seller, the Dutch Seller, the German Servicer, the Dutch Servicer or the relevant Swiss Servicer, including the Receivables, furnished to such assignor or transferor by or on behalf of the relevant Swiss Seller, the German Seller, the Dutch Seller, the relevant Swiss Servicer, the German Servicer or the Dutch Servicer provided that , prior to any such disclosure, the assignee or transferee or potential assignee or transferee agrees to observe the confidentiality of such information which is confidential in accordance with Clause 20 below.

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18.4      Set-Off
(a)          Except as otherwise provided in the Transaction Documents and subject to paragraph (b) of this Clause 18.4, all payments required to be made under the Transaction Documents shall be calculated without reference to any set-off or counterclaim and shall be made free and clear of and without any deduction for or on account of any set-off or counterclaim, save as provided by mandatory provisions of law.
(b)          The Master Purchaser, the Regency Noteholder, the Instructing Party and the Styron Security Trustee may (in addition to any other rights it may have) at any time after a Termination Event has occurred and is subsisting, set-off, appropriate and apply any deposits and any other indebtedness held or owing by such Person (acting in its capacity as such) to, or for the account of, a Swiss Seller, the German Seller, the Dutch Seller, the German Servicer, the Dutch Servicer or a Swiss Servicer against any amount owing by that Seller, the German Servicer, the Dutch Servicer or the relevant Swiss Servicer, as the case may be, to such Person.
18.5      Styron Noteholder, Master Purchaser, Swiss Sellers, Swiss Servicers, Dutch Seller and Dutch Servicer Set-Off
(a)          The Master Purchaser may, at any time, unless notified to the contrary by the Instructing Party, set-off its obligation to pay Initial Purchase Price to a Swiss Seller or the Dutch Seller against its right to receive any amount of Initial Subscription Price or Additional Subscription Price from the Styron Noteholder.
(b)          The Master Purchaser may, on any Monthly Payment Date, unless notified to the contrary by the Instructing Party, set-off its obligation to pay any Styron USD Note Redemption Amounts or Styron EUR Note Redemption Amounts to the Styron Noteholder against its right to receive Collections from each Seller.
(c)          The Styron Noteholder, the Master Purchaser, each Swiss Servicer, each Swiss Seller, the Dutch Servicer and the Dutch Seller may, on any Settlement Date, unless notified to the contrary by the Instructing Party:
(i)           set-off the Styron Noteholder’s obligation to pay any Additional Principal Amount under the Styron Note against the Master Purchaser’s obligation to pay Initial Purchase Price or Deferred Purchase Price to a Swiss Seller or the Dutch Seller on such Settlement Date;
(ii)        set-off each Swiss Servicer’s obligation to pay Collections to the Master Purchaser against the Master Purchaser’s obligation to pay any amounts due to the Styron Noteholder pursuant to the Styron Note; and
(iii)       set-off any amounts in accordance with Clause 3.3(c) of the Swiss Receivables Purchase Agreement, Clause 3.2(c) of the Dutch Receivables Purchase Agreement, Clause 4.3 of the Swiss Servicing Agreement or Clause 4.3 of the Dutch Servicing Agreement.

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18.6      Regulation
(a)          From 1 January 2015, the Sellers undertake to the Master Purchaser and the Noteholders that each of them will, whilst any of the Notes remain outstanding ensure the Noteholders have readily available access to all materially relevant data on the credit quality and performance of the individual Purchased Receivables, cash flows and collateral supporting the Transaction, as well as such tests on the cash flows and collateral values supporting the Notes (for the purpose of which, “materially relevant data” has the meaning given to it in Article 122a of Directive 2006/48/EC or any successor thereto) provided that no Seller shall be in breach of the undertakings given pursuant to this Clause 19.6 if due to events, actions or circumstances beyond such Seller’s control, such Seller is not able to comply with such undertakings, subject always to any requirement of law.
(b)          The Sellers and the Servicers covenant with the Cash Manager to provide it with all information which it may reasonably require to comply with requirements of law or regulation as to the disclosure of information including (but not limited to) pursuant to European Regulation 1060/2009 (as amended from time to time).
19.        COUNTERPARTS
Each of the Transaction Documents, including this Deed, can be executed in any number of counterparts and by the parties to it on separate counterparts, each of which shall be an original but all of which together shall constitute one and the same instrument. Delivery of a counterpart of any Transaction Document, including this Deed, by e-mail attachment or fax shall be an effective mode of delivery.
20.        CONFIDENTIALITY
None of the parties shall, and they shall procure that none of their agents or representatives shall, during the continuance of any of the Transaction Documents or after the termination of any of them, disclose to any person, firm or company whatsoever any information relating to the business, finances or other matters of a confidential nature of any other party to this Deed of which it may in the course of its duties under this Deed or any Transaction Document or otherwise have become possessed and all the parties shall use all reasonable endeavours to prevent any such disclosure, provided however that the provisions of this Clause 20 shall not apply:
(a)          to the disclosure of any information which is expressly permitted or required by the Transaction Documents to any person who is a party to any of the Transaction Documents or is required in relation to the transactions envisaged by the Transaction Documents;
(b)          to the disclosure of any information already known to the recipient otherwise than as a result of entering into or negotiating any of the Transaction Documents provided that the recipient has not, to the knowledge of the party disclosing information, acquired such information in breach of any contractual obligation of confidentiality;
(c)          to the disclosure of any information which is or becomes public knowledge otherwise than as a result of the conduct of the recipient or as a result of a breach of this Agreement;

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(d)          to the extent that the recipient is required to disclose the same pursuant to any law or regulation or order of any court or pursuant to any direction, request or requirement (whether or not having the force of law) of any central bank or any governmental or other regulatory authority (including any official bank examiners or regulators) or stock exchanges or Rating Agency or any other rating organisation to whom disclosure is required by applicable law in order to issue or maintain a credit rating, provided such disclosure is made strictly in accordance and solely to ensure compliance, with the provisions of the relevant law (including, for the avoidance of doubt, Rule 17g-5 of the General Rules and Regulations promulgated by the Securities Exchange Act of 1934);
(e)         to the disclosure of information in connection with, and for the purposes of, any litigation, arbitration, administrative or other investigations, proceedings or disputes;
(f)         to the extent that the recipient needs to disclose the same for the protection or enforcement of any of its rights under any of the Transaction Documents;
(g)          to the disclosure of any information to any provider of liquidity, credit enhancement, hedging or other facilities (subject to them being informed of the confidential nature of such information and being subject to confidentiality restrictions consistent with this Clause 20);
(h)         to the disclosure of any information to professional advisers who receive the same under a duty of confidentiality;
(i)          to the disclosure of any information with the written consent of the parties hereto in form and substance satisfactory to the Instructing Party; and
(j)           to the disclosure of any information reasonably disclosed to a prospective provider of Regency Noteholder Related Debt, a prospective or a substitute Instructing Party or Styron Security Trustee (provided it is disclosed on the basis that the recipient will hold it confidential and will not use it in the course of its business).
21.        CONTRACTS (RIGHTS OF THIRD PARTIES) ACT 1999
In relation to each Transaction Document governed by English law, a person who is not a party to such Transaction Document shall, unless otherwise expressly provided in a Transaction Document, have no right under the Contracts (Rights of Third Parties) Act 1999 to enforce any of the terms thereof.
22.        STYRON SECURITY TRUSTEE PARTY TO TRANSACTION DOCUMENTS
22.1      Better preservation and enforcement of rights
Except where any Transaction Document provides otherwise, the Styron Security Trustee has agreed to become a party to each Transaction Document to which it is a party only for the better preservation and enforcement of its rights under such Transaction Document and shall not assume any liabilities or obligations under any Transaction Document unless such obligation or liability is expressly assumed by the Styron Security Trustee in such Transaction Document.

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22.2      Styron Security Trustee has no responsibility
The Styron Security Trustee shall not have any responsibility for any of the obligations of the other Transaction Parties and the other Transaction Parties acknowledge that the Styron Security Trustee has no such responsibility and that the Styron Security Trustee is entitled to the protections contained in and on the terms set out in the Styron Security Deed.
22.3      Styron Security Deed governs the Styron Security Trustee
Each of the parties hereto agrees that the exercise or performance or non-exercise or non-performance of any of the trusts, powers, authorities, duties, discretions or obligations of, or the giving of any consents by the Styron Security Trustee and the Styron Security Trustee’s liability in relation to the same shall in the case of each Transaction Document to which it is a party be subject to the detailed provisions of the Styron Security Deed and, in the event of any conflict, the provisions of the Styron Security Deed shall prevail.
23.        TRUSTEE ACT
In relation to each Transaction Document governed by English law and which creates or purports to create a trust or fiduciary relationship, the parties hereto agree that to the fullest extent permitted by law, none of the provisions of the Trustee Act 2000 shall apply to the trust or fiduciary relationship created by such Transaction Document or to the role of the trustee or fiduciary in relation to such trust or fiduciary relationship. The disapplication of the Trustee Act 2000 as provided by this Clause 23 shall constitute an exclusion of the provisions of the Trustee Act 2000 for the purposes of that Act.
24.        RESTRICTION ON ENFORCEMENT OF SECURITY, NON-PETITION AND LIMITED RECOURSE IN FAVOUR OF THE MASTER PURCHASER
24.1      No proceedings against the Master Purchaser
Notwithstanding any other provision of this Deed or any Transaction Documents, only the Styron Security Trustee may pursue the remedies available under the general law or under the Styron Security Deed, the German Security Assignment and Trust Agreement or the U.S. Security Agreement to enforce the Security and no Transaction Party shall be entitled to proceed directly against the Master Purchaser to enforce the Security. Each Transaction Party (other than the Master Purchaser, the German Seller, the German Servicer, and the Styron Security Trustee) agrees with and acknowledges to each of the Master Purchaser and the Styron Security Trustee, and the Styron Security Trustee agrees with and acknowledges to the Master Purchaser, that:
(a)          none of the Transaction Parties (nor any person on their behalf, other than the Styron Security Trustee where appropriate) are entitled, otherwise than as permitted by the Transaction Documents, to direct the Styron Security Trustee to enforce the Security or take any proceedings against the Master Purchaser to enforce the Security;
(b)         none of the Transaction Parties (other than the Styron Security Trustee acting in accordance with the provisions of the Styron Security Deed, the German

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Security Assignment and Trust Agreement or the U.S. Security Agreement) shall have the right to take or join any person in taking any steps against the Master Purchaser for the purpose of obtaining payment of any amount due from the Master Purchaser to any of such Transaction Parties;
(c)          until the date falling two years after the Final Discharge Date none of the Transaction Parties nor any person on their behalf shall initiate or join any person in initiating an Insolvency Event or the appointment of an Insolvency Official in relation to the Master Purchaser other than a Receiver appointed under clause 18 ( Appointment and Removal of Administrator and Receiver ) of the Styron Security Deed; and
(d)          none of the Transaction Parties shall be entitled to take or join in the taking of any corporate action, legal proceedings or other procedure or step which would result in the Payments Priorities not being complied with.
24.2      Limited Recourse
(a)          Each Transaction Party (other than the Master Purchaser, the German Seller, the German Servicer and, in accordance with the provisions of the Styron Security Deed, the Styron Security Trustee) agrees with each of the Master Purchaser and the Styron Security Trustee, and the Styron Security Trustee agrees with the Master Purchaser, that notwithstanding any other provision of any Transaction Document, all obligations of the Master Purchaser to such Transaction Party, including, without limitation, the Obligations, are limited in recourse as set out below:
(i)           it will have a claim only in respect of the Charged Property and will not have any claim, by operation of law or otherwise, against, or recourse to any of the Master Purchaser’s other assets or its contributed capital;
(ii)        sums payable to each Transaction Party in respect of the Master Purchaser’s obligations to such Transaction Party shall be limited to the lesser of (a) the aggregate amount of all sums due and payable to such Transaction Party and (b) the aggregate amounts received, realised or otherwise recovered by or for the account of the Master Purchaser in respect of the Charged Property whether pursuant to enforcement of the Security or otherwise, net of any sums which are payable by the Master Purchaser in accordance with the Payments Priorities in priority to or pari passu with sums payable to such Transaction Party; and
(iii)       upon the Styron Security Trustee giving written notice to the Relevant Transaction Parties that it has determined in its sole opinion, that there is no reasonable likelihood of there being any further realisations in respect of the Charged Property (whether arising from an enforcement of the Security or otherwise) which would be available to pay unpaid amounts outstanding under the Relevant Transaction Documents, the Relevant Transaction Party shall have no further claim against the Master Purchaser in respect of any such unpaid amounts and such unpaid amounts shall be extinguished and discharged in full.

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The provisions of this Clause 24 ( Restriction on Enforcement of Security, Non-Petition and Limited Recourse in Favour of the Master Purchaser ) shall survive termination of the Transaction Documents.
(b)         For the avoidance of doubt Clause 21 ( Restriction on Enforcement of Security, Non-Petition and Limited Recourse in Favour of the Master Purchaser ) binds the German Seller and Clause 15.4 ( Subordination of German Servicer’s Rights and Non Petition Undertaking ) of the German Servicing Agreement binds the German Servicer.
25.        PROVISIONS RELATING TO THE TRANSACTION DOCUMENTS
25.1      Acknowledgement of the Security
Each Transaction Party:
(a)         acknowledges the Security created by the Master Purchaser Security Documents;
(b)          undertakes to the Styron Security Trustee not to do anything inconsistent with the Security or the terms of the Transaction Documents;
(c)         acknowledges that the Security is held by the Styron Security Trustee for the benefit of all the Secured Creditors and that any Receiver shall be appointed by the Styron Security Trustee for the benefit of all the Secured Creditors; and
(d)         acknowledges the existence of the rights conferred on the Noteholders by Condition 6.3 ( Consequences of Delivery of an Enforcement Notice ) and Condition 8 ( No action by Noteholders or any other Secured Creditor ).
25.2      Secured Creditors and Transaction Documents
Each Secured Creditor shall be deemed to have notice of, all of the provisions of the Transaction Documents.
25.3      Receipt
The Styron Security Trustee is hereby authorised to execute on behalf of the Secured Creditors a receipt in respect of all or part only of the Secured Amounts, as may be appropriate from time to time.
25.4      Recoveries after Enforcement
Except for moneys paid out by the Styron Security Trustee pursuant to the Post- Enforcement Payments Priorities, all monies received or recovered by the Secured Creditors in respect of the Secured Amounts after delivery of an Enforcement Notice (whether by way of set-off, retention, compensation, balancing of accounts or otherwise) shall forthwith be paid to (and pending such payment held on trust for) the Styron Security Trustee.

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26.        GOVERNING LAW
This Deed and any non-contractual obligations arising herefrom shall be governed by, and construed in accordance with, English law.
27.        FAILURE TO SATISFY INITIAL CONDITIONS PRECEDENT
27.1      Termination
If the Initial Conditions Precedent have not been satisfied or waived by the Instructing Party prior to 26 August 2010 the Transaction Parties hereby agree that, with effect from 26 August 2010, subject to Clause 27.2 ( Continuing obligations ) and Clause 27.3 ( Accrued liabilities ) and notwithstanding anything else contained in the Transaction Documents:
(a)          each Transaction party is irrevocably released and discharged from all covenants, undertakings, representations, warranties, liabilities and obligations owed to the other parties (or any of them) to the Transaction Documents arising under the Transaction Documents, whether, without limitation, in contract, tort or otherwise;
(b)          the rights and entitlements of each party to the Transaction Documents against the other parties to the Transaction Documents in respect of the Transaction Documents are irrevocably waived and cancelled; and
(c)          the Transaction Documents are terminated,
without giving rise to any liabilities as a result of such termination and discharge, other than as set out herein.
27.2      Continuing obligations
The termination of the Transaction Documents pursuant to Clause 27.1 is without prejudice to any provision of such Transaction Documents which expressly states that it will survive the termination of such Transaction Document, or which reserves the rights of the parties to such Transaction Document in the event that any payment made to them under or pursuant to the Transaction Document is subsequently challenged.
27.3      Accrued liabilities
The termination of the Transaction Documents is without prejudice to any rights and liabilities under the Transaction Documents accrued prior to 26 August 2010 and will not give rise to any liabilities as a result of such termination other than as set out herein.

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IN WITNESS of which this Deed has been executed and delivered as a deed by the parties to it on the date above mentioned.
[all signature blocks removed for the purposes of amendment]

 

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SCHEDULE 2	EXECUTION VERSION	
 
SCHEDULE 1
PART A
TERMINATION EVENTS
The occurrence of any of the following events shall constitute a Termination Event:
(a)         Non-Payment :  a Seller or a Servicer fails to pay any amount due under any of the Transaction Documents within three (3) Business Days after the earlier of that Seller or that Servicer becoming aware of such default and the receipt by that Seller or that Servicer (as the case may be) of written notice by or on behalf of the Master Purchaser requiring the same to be remedied;
(b)          Misrepresentation :  any representation or warranty made or deemed to be made by the Parent, the Styron Noteholder, a Seller or a Servicer (or any of their respective officers) under or in connection with this Deed or any other Transaction Document or any information or report delivered by the Parent, the Styron Noteholder, that Seller or that Servicer pursuant to this Deed or any other Transaction Document shall prove to have been incorrect or untrue in any material respect when made or deemed made or delivered, unless such representation or warranty relates solely to one or more specific Receivables incorrectly characterised as Eligible Receivables and in the case of the representations and warranties contained in paragraphs (a) and (i) of Schedule 1 Part A of the Master Receivables Purchase Agreement, the breach of such representation or warranty is capable of being cured and is in fact cured (without any adverse impact on the Master Purchaser, the Regency Noteholder, the Liquidity Provider, the Styron Security Trustee or the Instructing Party or the collectability of the Receivables) within fifteen (15) Business Days after the first date on which the relevant Seller obtains knowledge or receives written notice of such breach from any Affected Person);
(c)         Breach of Obligations :
(i)           A Seller, the Styron Noteholder or a Servicer shall fail to perform or observe any other term, covenant or agreement contained in this Deed or any other Transaction Document (other than as referred to in paragraph (ii) below) on its part to be performed or observed and any such failure shall remain unremedied fifteen (15) days, provided that failure of a Seller or a Servicer (as the case may be) to perform or observe any covenant contained in clauses 4.3 (g), (h), and (m) of a Master Receivables Purchase Agreement (excluding the U.S. Receivables Purchase Agreement and the U.S. Intermediate Transfer Agreement) or clauses 4.3(g), (i) and (n) of the U.S. Receivables Purchase Agreement and the U.S. Intermediate Transfer Agreement (as the case may be) shall not be entitled to the benefit of such 15-day period; or
(ii)       a Seller shall fail to perform or observe any covenant or agreement contained in clauses 4.3(g), (h) or (m) of the relevant Master Receivables Purchase Agreement (excluding the U.S. Receivables Purchase Agreement and the U.S. Intermediate Transfer Agreement) or clauses 4.3(g), (i) and (n) of the U.S. Receivables Purchase Agreement and the U.S. Intermediate Transfer Agreement (as the case may be), in each case, on its part to be performed or observed and any such failure shall remain unremedied for five (5) Business Days;

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(d)          Cross Acceleration :  an event shall occur or condition shall exist under any agreement or instrument relating to any Debt of the Parent, the Styron Noteholder, a Seller or a Servicer which is outstanding in a principal amount of at least USD 30,000,000 or its equivalent in another Approved Currency in aggregate, and, as a result of such event or condition, the maturity of such Debt is accelerated; or any such Debt shall be declared to be due and payable, or required to be prepaid (other than by a regularly scheduled required prepayment), redeemed, purchased or defeased, or an offer to repay, redeem, purchase or defease such Debt shall be required to be made, in each case prior to the stated maturity thereof;
(e)         Valid Security :  either:
(i)           the Styron Security Trustee shall, for any reason cease to have a valid and perfected first priority Encumbrance in all of the property, assets and rights of any kind of the Master Purchaser; or
(ii)       any Account Control Agreement does not, or ceases to create, a valid and perfected first priority Encumbrance in favour of the Master Purchaser or the Styron Security Trustee (as applicable) in respect of the Collection Accounts;
(f)         Invalidity :  any material provision of any of the Transaction Documents is, or becomes, for any reason, invalid or unenforceable and the Master Purchaser, the Instructing Party, the Liquidity Facility Provider, the Styron Security Trustee or the Regency Noteholder would be materially prejudiced by such provision becoming invalid or unenforceable;
(g)         Change of Control :  a Change of Control occurs that is not previously approved by the Instructing Party;
(h)         Judgment :  one or more judgments for the payment of money exceeding an amount in the sum of USD 30,000,000 (except to the extent covered by insurance as to which the insurer has acknowledged in writing it will cover the entire amount of any such judgment) shall be rendered against the Styron Noteholder, a Seller or a Servicer and the same shall remain undischarged for a period of 45 consecutive days during which execution shall not be effectively stayed, or any action shall be taken by a judgment creditor to attach or levy upon any assets of the relevant Seller or Servicer to enforce any such judgment;
(i)          Material Adverse Change :  any event or series of events (whether related or not) occurs which in the reasonable opinion of the Instructing Party will have a Material Adverse Effect;
(j)          Servicer Defaul t:  any Servicer Default occurs;
(k)         Trigger Events :  as of any Determination Date either:
(i)           the 3 month rolling average of the Collection Ratio as at such Determination Date falls below 35%; or
(ii)       the 3 month rolling average of the Default Ratio as at such Determination Date exceeds 2%; or

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(iii)      the 3 month rolling average of the Dilution Ratio as at such Determination Date exceeds 3.5%, or
(iv)         the 3 month rolling average of the Delinquency Ratio as at such Determination Date exceeds 4%,
provided that in the case of (ii) and (iv), there shall not be a Termination Event if:
(A)         there would not be an excess if the aggregate of each of the Purchased Receivables relating to one Large Obligor are excluded from the relevant calculation; and
(B)         in the case of (ii), the Default Ratio as at the immediately preceding Determination Date did not exceed 1.5%, or in the case of (iv) the Delinquency Ratio as at the immediately preceding Determination Date did not exceed 3%.
(l)          Perfection Events :  any Perfection Event occurs;
(m)         Asset Shortfall :  an Asset Shortfall occurs;
(n)          Master Purchaser Enforcement Event :  any Master Purchaser Enforcement Event occurs;
(o)          Misuse of Collection Accounts :  a Seller or a Servicer withdraws, makes payment, or otherwise deals with funds standing in the balance of a Collection Account other than in a manner authorised under the Transaction Documents or otherwise without the prior written consent of the Master Purchaser and the Instructing Party, save that such withdrawal, payment or dealing with funds, if made as a result of a technical or administrative error, may be remedied within 1 Business Day.  The Master Purchaser, the Sellers and the Servicers agree that during period beginning on the Closing Date and ending on the day following the fourth Monthly Payment Date, the occurrence of the events or circumstances outlined in this paragraph (o) shall not constitute a Termination Event provided the Sellers and the Servicers have used reasonable endeavours to prevent such occurrence;
(p)          Spanish Collection Account :  there is no Account Control Agreement in place in respect of the Collection Account at the Madrid branch of the Collection Account Bank by 23 September 2010 or the Collections credited to the Madrid branch of the Collection Account Bank prior to an Account Control Agreement being put in place in respect of it are not transferred to the Collection Account denominated in EUR held at the Frankfurt branch of the Collection Account Bank on the Business Day following receipt of such Collections into such Collection Account unless the failure to transfer is caused by an administrative or technical error or some other disruption to the financial markets or payment operations and the transfer is made within three Business Days of its due date;
(q)          German Tax Indemnity :  for the purposes of the German Receivables Purchase Agreement, the German Servicing Agreement and any Account Control Agreement relating to the German Seller only, the German Servicer’s outstanding liability under

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Clause 13.3(h) of the German Servicing Agreement is equal to or greater than €2,500,000; and
(r)         Failure to fund by Styron Noteholder :  the Styron Noteholder fails to pay (or advance) any amount due from it as and when due under the Styron Notes or the Variable Loan Note Issuance Deed.

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PART B
PERFECTION EVENTS
The occurrence of any of the following events shall constitute a Perfection Event:
(a)          Attachment :  all or any part of the property, business, undertakings, assets or revenues of a Seller or a Servicer having an aggregate value in excess of USD 30,000,000 has been attached as a result of any distress or execution being levied or any encumbrance taking possession or similar attachment and such attachment has not been lifted within thirty (30) days, unless in any such case the Instructing Party certifies that in its reasonable opinion such event will not materially prejudice the ability of a Seller or a Servicer to observe or perform its obligations under the Transaction Documents or the enforceability, collectability or origination of the Receivables;
(b)          Insolvency :  any Seller or any Servicer is or becomes or is declared to be insolvent or over-indebted (value of its assets is lower than the value of its liabilities) (including bankruptcy and suspension of payments) or is or becomes unable to pay its debts as they fall due or suspends or threatens to suspend making payments (whether of principal or interest) with respect to all or any class of its debts;
(c)          Composition :  any Seller or any Servicer convenes a meeting of its creditors or proposes or makes any arrangement or composition with, or any assignment for the benefit of, or any moratorium with its creditors (other than (i) for the purposes of a solvent reconstruction or amalgamation on such terms and within such period as may previously have been approved in writing by the Instructing Party or (ii) for the purposes of an intra-group restructuring, provided that (for the purposes of (ii) (A) the Sellers and the Parent shall continue to have the same ultimate holding company as prior to the intra-group restructuring, and (B) the intra- group restructuring will not have a Material Adverse Effect on the Parent or the Sellers) which do not, in the opinion of the Instructing Party, have a Material Adverse Effect and have previously have been approved in writing by the Instructing Party) or any other corporate action is taken or any legal proceedings are commenced by a Seller or a Servicer with a view to any such composition, arrangement, assignment or moratorium being made;
(d)          Winding Up, Administration :  a petition (other than a petition which is dismissed or stayed within thirty (30) days of being instituted or which is frivolous or vexatious or which would not result in a Material Adverse Effect) is presented or other formal steps are taken for the purpose of considering a resolution or other preparatory steps are taken or legal proceedings are commenced for the liquidation, dissolution, administration or reorganisation of a Seller or a Servicer (other than (i) for the purposes of a solvent reconstruction or amalgamation on such terms and within such period as may previously have been approved in writing by the Instructing Party or (ii) for the purposes of an intra-group restructuring, provided that (for the purposes of (ii) (A) the Sellers and the Parent shall continue to have the same ultimate holding company as prior to the intra-group restructuring, and (B) the intra-group restructuring will not have a Material Adverse Effect on the Parent or the Sellers);
(e)          Analogous Proceedings :  an event analogous to any of the events specified in paragraphs (a), (b), (c) or (d) occurs under the laws of any relevant jurisdiction;

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(f)         Encumbrance :  any of the Sellers or the Servicers creates or grants any Encumbrance or permits any Encumbrance to arise over or in relation to:
(i)           any Purchased Receivable;
(ii)       any right, title or interest of the Master Purchaser in relation to a Purchased Receivable;
(iii)      any proceeds of or sums received or payable in respect of a Purchased Receivable; or
(iv)         the interest of the Master Purchaser in any amount from time to time standing to the credit of the Collection Accounts,
other than pursuant to the Account Control Agreement or a Seller Permitted Encumbrance;
(g)         Dispute :  a Seller disputes, in any manner, the validity or efficacy of any sale and purchase of a Receivable under a Master Receivables Purchase Agreement;
(h)         Illegality :  it becomes impossible or unlawful for a Seller or a Servicer to continue its business or discharge its obligations as contemplated by the Transaction Documents and as a result, in the reasonable opinion of the Instructing Party, there is, or is likely to be, a Material Adverse Effect on the ability of a Seller or a Servicer to perform their respective obligations under the Transaction Documents or the enforceability, collectability or origination of the Receivables is or is likely to be materially prejudiced.
(i)          Set off by Collection Account Bank :  a Collection Account Bank exercises any right of set off against funds standing in the balance of any Collection Account other than as contemplated pursuant to an Account Control Agreement, other than in relation to account fees charged directly to the relevant Collection Account, and such set off is not repaid into the relevant Collection Account within 8 Business Days.

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SCHEDULE 2
SWISS SERVICER DEFAULTS
The occurrence of any of the following events shall constitute a Swiss Servicer Default:
(a)        Any Swiss Servicer:
(i)           shall fail to perform or observe any term, covenant or agreement under the Swiss Receivables Purchase Agreement or the Swiss Servicing Agreement and such failure shall remain unremedied for five (5) Business Days; or
(ii)       shall fail to make when due any payment or deposit to be made by it under the Swiss Receivables Purchase Agreement and the Swiss Servicing Agreement and such failure shall remain unremedied for two Business Days; or
(iii)      shall fail to deliver any Swiss Servicer Report when required and such failure shall remain unremedied for two Business Days or one Business Day in respect of Swiss Servicer Reports being delivered on a Daily Reporting Date (unless previously agreed between the Swiss Servicer and Master Purchaser that such Swiss Servicer Report shall be delivered at a later date or if such late delivery is due solely to computer or other technical failure, such failure shall remain unremedied for five Business Days).
(b)        Any representation or warranty made or deemed made by a Swiss Servicer under or in connection with the Swiss Receivables Purchase Agreement or Swiss Servicing Agreement or any other Transaction Document or any information or report delivered by a Swiss Servicer pursuant to the Swiss Receivables Purchase Agreement and Swiss Servicing Agreement or any other Transaction Document shall prove to have been incorrect or untrue in any material respect when made or deemed made or delivered unless the breach of such representation or warranty is capable of being cured and is in fact cured (without any adverse impact on the Master Purchaser, the Regency Noteholder, the Liquidity Provider, the Styron Security Trustee or the Instructing Party or the collectability of the Receivables) within fifteen (15) Business Days after the first date on which the relevant Seller obtains knowledge or receives written notice of such breach from any Affected Person.
(c)        Any Swiss Servicer shall generally not pay its debts as such debts become due, or shall admit in writing its inability to pay its debts generally, or shall make a general assignment for the benefit of creditors; or any proceeding shall be instituted by or against a Swiss Servicer seeking to adjudicate it a bankrupt or insolvent, or seeking liquidation, winding up, reorganisation, arrangement, adjustment, protection, relief, or composition of it or its debts under any law relating to bankruptcy, insolvency or reorganisation or relief of debtors, or seeking the entry of an order for relief or the appointment of a receiver, trustee, custodian or other similar official for it or for any substantial part of its property and, in the case of any such proceeding instituted against it (but not instituted by it), either such proceeding shall remain undismissed or unstayed for a period of 30 days, or any of the actions sought in such proceeding (including, without limitation, the entry of an order for relief against, or the appointment of a receiver, trustee, custodian or other similar official for, it or for any substantial part of its property) shall occur; or a Swiss Servicer shall take any corporate or other action to authorize any of the actions set forth above in this paragraph (c).

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(d)        An event shall occur or condition shall exist under any agreement or instrument relating to any Debt of a Swiss Servicer which is outstanding in a principal amount of at least USD 30,000,000 in the aggregate and, as a result of such event or condition, the maturity of such Debt is accelerated; or any such Debt shall be declared to be due and payable, or required to be prepaid (other than by a regularly scheduled required prepayment), redeemed, purchased or defeased, or an offer to repay, redeem, purchase or defease such Debt shall be required to be made, in each case prior to the stated maturity thereof.
(e)        There shall have occurred any event which causes an Account Control Agreement to cease to be in full force and effect or the Account Control Agreement ceases to be a valid, first priority, perfected Encumbrance, except where such an event is a result of termination of the relevant account by the Collection Account Bank, in which case the relevant Swiss Servicer must procure within 30 days that:
(i)           a replacement account is opened with another account bank on terms satisfactory to the Master Purchaser; and
(ii)       a new Account Control Agreement is entered into as a valid, first priority, perfected Encumbrance with respect to any replacement account on terms satisfactory to the Master Purchaser,
(f)        There shall have occurred any event which may have a Material Adverse Effect on the ability of a Swiss Servicer to collect Pool Receivables or otherwise perform its obligations under the Swiss Receivables Purchase Agreement and Swiss Servicing Agreement and the other Transaction Documents or any provision of any Transaction Document applicable to a Swiss Servicer shall cease to be effective and valid and binding on the relevant Swiss Servicer.
(g)        One or more judgments for the payment of money in an aggregate amount in excess of USD 30,000,000 shall be rendered against a Swiss Servicer or any combination thereof, and the same shall remain undischarged for a period of 30 consecutive days during which execution shall not be effectively stayed, or any action shall be taken by a judgment creditor to attach or levy upon any assets of the relevant Swiss Servicer to enforce any such judgment.

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SCHEDULE 3
ELIGIBILITY CRITERIA IN RESPECT OF RECEIVABLES
In order for a Receivable to meet the Eligibility Criteria, the Receivable or, as the case may be, the relevant Contract from which it is derived must satisfy the following criteria on the last date of the relevant Determination Period unless otherwise agreed between the relevant Seller and the Cash Manager:
(a)         The Obligor :  The Obligor must be an Eligible Obligor who is a resident in an Unrestricted Country or an Eligible Country, may neither be an Affiliate of either Parent or a Seller nor a government or a government subdivision or government agency;
(b)         Obligor in default :  The Obligor may not be an obligor of Defaulted Receivables the aggregate Outstanding Balance of which is in excess of 40% of the aggregate Outstanding Balance owed by such Obligor;
(c)         Corporate :  The Obligor must be a corporation, limited liability company, business trust or other Person other than an individual;
(d)         No current accounts :  There are no current or running accounts between the relevant Seller and the Obligor;
(e)         No public procurement or intra-group loans :  The Receivable does not originate under a Contract subject to any applicable public procurement laws or pursuant to an intra-group loan;
(f)         No Defaulted Receivables :  The Receivable is not a Delinquent Receivable or a Defaulted Receivable (which, for  purposes of determining whether such Receivable is a Non-Conforming Receivable (as defined in the related Master Receivables Purchase Agreement), shall be determined solely as of the related Purchase Date);
(g)         Obligation to Pay :  The following conditions are met:
(i)         the relevant Seller has received a purchase order from the Obligor for chemical products;
(ii)       the goods have been delivered by the relevant Seller to the Obligor and a delivery note for the products has been signed by the Obligor and retained by the relevant Haulage Company; and
(iii)      the Obligor became obliged to pay for the products in accordance with the relevant Contract.
(h)         Payment Term :  In the case of a Receivable that is not an Unbilled Receivable, the Receivable must be evidenced by an invoice and is required to be paid in full within 120 days of the original billing date thereof.
(i)          Bona fide obligation :  The Receivable must represent a bona fide obligation of the Obligor to pay (i) in the case of a Billed Receivable, the stated amount or (ii) in the case of an Unbilled Receivable, the amount calculated in the manner set forth in the related Contract as the amount due with respect thereto;

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(j)           No lien :  The Receivable must not be subject to any Encumbrance other than Seller Permitted Encumbrance;
(k)          Conformity :  The Receivable must be in conformity in all material respects with all applicable laws, rules and regulations in effect and with respect to which none of the Swiss Sellers, German Seller, the Dutch Seller, the U.S. Seller, the German Servicer, the Dutch Servicer, the U.S. Servicer, the Swiss Servicers or the Obligor is in violation of any such law, rule or regulation in any material respect;
(l)           Title :  The Receivable arises under a Contract which, together with such Receivable, is in full force and effect and constitutes the legal, valid and binding obligation of the Obligor of such Receivable and is not subject to any dispute, offset, counterclaim or defence whatsoever (except the potential discharge in bankruptcy of such Obligor) and the Obligor has no right to return the related goods for any reason other than that such goods do not conform to the terms of such Contract;
(m)         Freely assignable :  Title to or ownership of, as applicable, the Receivable is freely assignable to the Master Purchaser without the need for the consent of or notice to the Obligor or any other person, or where consent is required to assign the Receivable, such consent is obtained;
(n)          Business :  The Receivable must arise from the sale of chemical products of the relevant Seller in the ordinary course of its business;
(o)          Contract :  The Contract underlying the Receivable is (unless the relevant Obligor is listed in Schedule 12 ( Approved Non-Standard Documentation Obligors ), as may be amended from time to time with the consent of the Cash Manager, and the relevant Contract has been approved by the Cash Manager) in the form of the Standard Documentation and has not been extended, rewritten or otherwise modified for credit related reasons from the original terms thereof other than any modifications for the purpose of protecting the interest of the Master Purchaser or except as permitted by the relevant Seller’s Credit and Collection Procedures. The Contract underlying the Receivable does not contain any confidentiality provisions or prohibitions on assignment which may prejudice the sale or enforcement or collectability of the Receivable or the Related Security or the creation or enforceability of a first priority security interest thereover, except where such provision has been waived by the relevant Obligor;
(p)          Non-interest bearing :  The Receivable is a non-interest bearing obligation other than in respect of interest charged for late payment;
(q)          Credit and Collection Procedures : Any credit given in respect of the Receivable constitutes normal payment extension only and was granted in conformity with the relevant Seller’s Credit and Collection Procedures;
(r)          Unsecured :  The Receivable is unsecured other than by way of retention of title;
(s)          No bill of exchange or promissory note :  The Receivable is not represented by a bill of exchange or promissory note or similar document due delivery of which is required to achieve a true sale or endorsement of such Receivable;

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(t)           Governing law :  The Receivable and the Contract relating to it are governed by, in the case of the Swiss Receivables Purchase Agreement, Swiss law, in the case of the German Receivables Purchase Agreement, German law, in the case of the Dutch Receivables Purchase Agreement, Dutch law, and in the case of the U.S. Receivables Purchase Agreement, the laws of one of the states of the U.S. or of the District of Columbia;
(u)          Concentration limit :  subject, for any Obligor, to the Obligor Limits which may exceed the Normal Concentration Limit in accordance with the definition of Obligor Limit, the aggregate Outstanding Balance of the Receivables owed by the same Obligor and which remain outstanding, may not exceed three (3) per cent. of the Outstanding Balance of all Eligible Receivables (the “ Normal Concentration Limit ”) or such other higher percentage for such Obligor designated in Schedule 4 hereto (a “ Special Concentration Limit ”); provided that , affiliated Obligors shall be treated as if they were one Obligor. The Cash Manager may, at its sole discretion, reduce or cancel a Special Concentration Limit upon 3 Business Days’ notice to the relevant Seller. Any Special Concentration Limit held by an Obligor shall immediately be cancelled in the event that such Obligor is assigned an unsecured long-term debt rating below Baa3 or Moody’s BBB-1 by S&P.  Further Special Concentration Limits can be only be added with the written consent of the Cash Manager.
(v)          Performance of obligations :  The relevant Seller has satisfied and fully performed all obligations with respect to such Receivable required to be fulfilled by it other than customary warranty obligations, and no further action (other than, in the case of an Unbilled Receivable, the processing and mailing of an invoice) is required to be performed by any person with respect thereto other than payment thereon by, the applicable Obligor.
(w)         Countries Limit :  if the Obligor for which the Receivable relates is not from an Unrestricted Country, the aggregate Outstanding Balance of such Receivable and all other Purchased Receivables for which the Obligor is not from Unrestricted Countries, will not at the next following Settlement Date be in excess of the Countries Limit (but any such Receivable shall be ineligible only to the extent of such excess).
(x)          Currencies Limit :  if the Receivable is a Currency Receivable, the aggregate Outstanding Balance of such Receivable and all other Purchased Receivables that are Currency Receivables, will not at the next following Settlement Date be in excess of the Currency Limit (but any such Receivable shall be ineligible only to the extent of such excess).
(y)          Country Credit Rating Limit :  if the Obligor for which the Receivable relates is from a Non-Investment Grade Country, the aggregate Outstanding Balance of such Receivable and all Purchased Receivables for which the Obligor is from a Non-Investment Grade Country, will not at the next following Settlement Date be in excess of 10% of the USD Equivalent of the Outstanding Balances of the Purchased Receivables (but any such Receivables shall be ineligible only to the extent of such excess);
(z)          Unbilled Receivables Limit :  if the Obligor for which the Receivable relates was an Unbilled Receivable on the day the Offer in respect of that Receivable was made, the aggregate Outstanding Balance of such Receivable and all other Purchased Receivables

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which were Unbilled Receivables on the day the Offer in respect of them was made exceeds the Unbilled Receivables Limit (but any such Receivables shall be ineligible only to the extent of such excess);
(aa)       Denomination :  the Receivable must:
(i)           be denominated in one of the Approved Currencies, the Collections in respect of which are paid by the relevant Obligor into a Collection Account; or
(ii)       be a Currency Receivable the Collections in respect of which are paid by the relevant Obligor into a Currency Receivables Collection Account;
such Collection Account or, as the case may be, Currency Receivables Collection Account being secured by an Account Control Agreement (substantially on the same terms as the UK Account Control Deed (taking into account any differences required by applicable laws) which a counsel qualified in the relevant jurisdiction has opined to the Instructing Party, the Styron Security Trustee and the Master Purchaser creates a valid security interest over the relevant account) in respect of which the relevant branch of the Collection Account Bank has provided an acknowledgement (in a form approved by the Instructing Party) and subject in the case of Currency Receivables to the Currencies Limit in (x) above;
(bb)       German and Dutch Purchased Receivables :  all Receivables purchased pursuant to the German Receivables Purchase Agreement and the Dutch Receivables Purchase Agreement must be denominated in Euros; and
(cc)       Excluded Receivable :  the Receivable is not an Excluded Receivable.

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SCHEDULE 4
SPECIAL CONCENTRATION LIMITS
Receivables owed by [              ] have, collectively, a Special Concentration Limit of 10% of the Outstanding Balance of all Eligible Receivables.

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SCHEDULE 5
UNRESTRICTED COUNTRIES
Austria
Belgium
Bulgaria
Cyprus
Czech Republic
Denmark
Estonia
Finland
France
Federal Republic of Germany
Greece
Hungary
Ireland
Israel
Italy
Latvia
Lithuania
Luxembourg
Norway
Poland
Portugal
Romania
Slovak Republic
Slovenia
South Africa

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Spain
Sweden
Switzerland
The Netherlands
United Kingdom

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SCHEDULE 6
ELIGIBLE COUNTRIES
Belarus
Canada
Egypt
India
Russia
South Korea
Taiwan
Turkey
United States

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SCHEDULE 7
MASTER PURCHASER REPRESENTATIONS, WARRANTIES AND COVENANTS
PART A
REPRESENTATIONS AND WARRANTIES
Corporate Representations and Warranties of the Master Purchaser
1.          INCORPORATION
The Master Purchaser, a limited liability was incorporated under the laws of Ireland on 29 June 2010.
2.          CENTRE OF MAIN INTERESTS
The Master Purchaser has its “centre of main interests”, as that term is used in Article 3(1) of the EU Insolvency Regulation, in Ireland.
3.          TAX RESIDENCE
The Master Purchaser is a company which is and has, since incorporation, been resident for tax purposes solely in Ireland.
4.          MANAGEMENT AND ADMINISTRATION
The Master Purchaser’s management, the places of residence of the directors of the Master Purchaser and the place at which meetings of the board of directors of the Master Purchaser are held are all situated in Ireland.
5.          NO ESTABLISHMENT, SUBSIDIARIES, EMPLOYEES OR PREMISES
The Master Purchaser has no “establishment”, as that term is used in Article 2(h) of the EU Insolvency Regulation outside of Ireland, no subsidiaries, no employees and no premises.
6.          LITIGATION
No litigation, arbitration or administrative proceedings of or before any court, tribunal or governmental body have been commenced or are pending or threatened against the Master Purchaser or any of its assets or revenues which may have a Material Adverse Effect on the Master Purchaser, any Relevant Transaction Document, the Notes, or any Assigned Rights or which may have a significant effect on the financial position of the Master Purchaser.
7.          SOLVENCY
No Insolvency Event has occurred in respect of the Master Purchaser and no Insolvency Event will occur in respect of the Master Purchaser in consequence of its entering into the Relevant Transaction Documents or purchasing Receivables under the Master Receivables Purchase Agreement.

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8.          NO ENCUMBRANCES
No Encumbrance exists over or in respect of any asset of the Master Purchaser save as permitted by the Relevant Transaction Documents.
9.          MASTER PURCHASER’S ACTIVITIES
The Master Purchaser has not engaged in any activities since its incorporation other than:
(a)        those incidental to its registration under the Irish Companies Acts 1963–2009;
(b)        other appropriate corporate steps;
(c)        the authorisation of the issue of the Notes and the authorisation and execution of the Relevant Transaction Documents; and
(d)        the activities referred to in or contemplated by the Relevant Transaction Documents.
10.        FINANCIAL STATEMENTS
The Master Purchaser has not since incorporation prepared any Financial Statements and has not paid any dividends or made any distributions since incorporation.
11.        NO ADVERSE CHANGE
Since the date of its incorporation there has been no adverse change in the financial position or prospects of the Master Purchaser.
12.        CONSENTS
The Master Purchaser has obtained and maintained in effect all authorisations, approvals, licences and consents required in connection with its business and the consummation of the transactions contemplated by the Relevant Transaction Documents and the Notes pursuant to any Requirement of Law or any Regulatory Direction applicable to the Master Purchaser in Ireland and in each other jurisdiction in which the Master Purchaser carries on business.
13.        TAXATION
The Master Purchaser is not registered or liable to be registered (or part of any registration), and will not voluntarily become registered (or part of any registration), for VAT in the United Kingdom. The Master Purchaser is not, and will not be, treated as a member of any VAT Group.
14.        NO GOVERNMENTAL INVESTIGATION
No governmental or official investigation or inquiry concerning the Master Purchaser is, so far as the Master Purchaser is aware, progressing or pending or has been threatened which may have a Material Adverse Effect on the Master Purchaser, any Relevant Transaction Document, the Notes or any of the Assigned Rights.

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15.        TAX STATUS
The Master Purchaser is a qualifying company within the meaning of section 110 of the Taxes Consolidation Act 1997 of Ireland (as amended).

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Transaction Document Representations and Warranties of the Master Purchaser
16.        CORPORATE POWER
The Master Purchaser has the requisite power and authority to:
(a)        enter into each Relevant Transaction Document; and
(b)        create and issue the Notes and the Security,
and to undertake and perform the obligations expressed to be assumed by it under such Relevant Transaction Documents.
17.        AUTHORISATION
All acts, conditions and things required to be done, fulfilled and performed in order:
(a)          to enable the Master Purchaser lawfully to issue, distribute and perform the terms of the Notes;
(b)          to enable the Master Purchaser lawfully to enter into each Relevant Transaction Document;
(c)          to enable the Master Purchaser lawfully to exercise its rights under and perform and comply with the obligations expressed to be assumed by it in the Relevant Transaction Documents;
(d)          to ensure that the obligations expressed to be assumed by it in the Notes and the Relevant Transaction Documents are legal, valid, binding and enforceable against it subject to the reservations set out in the Matheson Ormsby Prentice legal opinion dated on or about the U.S. Funding Date relating to the Transaction; and
(e)          to make the Notes and the Relevant Transaction Documents admissible in evidence in Ireland,
have been done, fulfilled and performed and are in full force and effect or, as the case may be, have been effected, and no steps have been taken to challenge, revoke or cancel any such authorisation obtained or effected.
18.        EXECUTION
The Relevant Transaction Documents have been duly executed by the Master Purchaser and the Master Purchaser is not a party to any agreement, indenture, contract, mortgage, deed or other instrument other than the Transaction Documents.
19.        NO BREACH OF LAW OR CONTRACT
The entry by the Master Purchaser into and the execution (and, where appropriate, delivery) of the Relevant Transaction Documents, the performance by the Master Purchaser of its obligations under the Relevant Transaction Documents and the

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creation and issue of the Notes and the Security do not and will not conflict with or constitute a breach or infringement or a default by the Master Purchaser of:
(a)        the Master Purchaser’s Memorandum and Articles of Association; or
(b)        any Requirement of Law or any Regulatory Direction,
where such conflict, breach, infringement or default may have a Material Adverse Effect on the Master Purchaser, any Relevant Transaction Document, the Notes or any Assigned Rights.
20.        VALID AND BINDING OBLIGATION S
The obligations expressed to be assumed by the Master Purchaser under the Relevant Transaction Documents are legal and valid limited recourse obligations, binding on it and enforceable against it in accordance with their terms, except:
(a)          as such enforcement may be limited by applicable bankruptcy, insolvency, moratorium, reorganisation or other similar laws affecting the enforcement of the rights of creditors generally;
(b)          as such enforceability may be limited by the effect of general principles of equity; and
(c)          obligations relating to stamp duties may be void by virtue of Section 117 of the Stamp Act 1891.
21.        NOTES VALID AND BINDING
The Notes constitute legal and valid limited recourse obligations, binding on it and enforceable against it in accordance with their terms, except:
(a)          as such enforcement may be limited by applicable bankruptcy, insolvency, moratorium, reorganisation or other similar laws affecting the enforcement of the rights of creditors generally;
(b)          as such enforceability may be limited by the effect of general principles of equity; and
(c)          obligations relating to stamp duties may be void by virtue of Section 117 of the Stamp Act 1891.
22.        STATUS OF NOTES
The Notes will constitute secured obligations of the Master Purchaser in accordance with the terms of the Security Deed.
23.        PURPOSES
The Relevant Transaction Documents have been entered into by the Master Purchaser solely for business or other commercial purposes of the Master Purchaser.

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24.        ARMS’ LENGTH TRANSACTIONS, PURPOSES
The Relevant Transaction Documents have been entered into by the Master Purchaser in good faith for the benefit of the Master Purchaser and on arms’ length commercial terms.
25.        CROSS DEFAULT
The Master Purchaser is not in breach of or default under any agreement, indenture, contract, mortgage, deed or other instrument to which it is a party or which is binding on it or any of its assets to an extent or in a manner which would be reasonably likely to have a Material Adverse Effect on the Master Purchaser, any Relevant Transaction Document or any of the Assigned Rights or the Notes.
26.        COMPLIANCE WITH RELEVANT TRANSACTION DOCUMENTS
The Master Purchaser has complied with the terms of the Relevant Transaction Documents.
27.        SECURITY
Each of the Styron Security Deed, the German Security Assignment and Trust Agreement and the U.S. Security Agreement validly creates the Encumbrances in respect of the assets of the Master Purchaser which it purports to create except that no representation is given as to whether or not such Encumbrances are fixed or floating charges.
28.        ENCUMBRANCES VALID AND BINDING
The Encumbrances created by the Styron Security Deed, the German Security Assignment and Trust Agreement  and U.S. Security Agreement are legal and valid obligations, binding on it and enforceable against it in accordance with their respective terms and not liable to be avoided or otherwise set aside in the event of any Insolvency Event in relation to the Master Purchaser subject as to enforcement to the effect of applicable bankruptcy, insolvency, moratorium, reorganisation or other similar laws affecting the enforcement of the rights of creditors generally and general principles of equity.
29.        RANKING OF CLAIMS
The claims of the Secured Creditors against the Master Purchaser will rank in priority to the claims of unsecured creditors of the Master Purchaser as provided in the Security Deed.
30.        CHOICE OF LAW
Subject to the reservations set out in the Matheson Ormsby Prentice legal opinion dated on or about the Swiss Funding Date relating to the Transaction:
(a)          the choice of English law, Swiss law, German law and U.S. law respectively as the governing law of the Transaction Documents, as applicable, will be recognised and enforced in Ireland; and

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(b)          any judgment obtained in England in relation to any Transaction Document will be recognised and enforced in Ireland.
31.        FILINGS
Save for the Required Filings in respect of the Master Purchaser under the laws of Ireland it is not necessary that any Relevant Transaction Document be filed, recorded or enrolled with any court or other authority in Ireland.
32.        CONSENTS
The Master Purchaser does not require the consent of any other party or the consent, licence, approval or authorisation of any Governmental Authority in connection with the creation and issue of the Notes, the entering into or performance of the Relevant Transaction Documents.
33.        STAMP, REGISTRATION AND SIMILAR TAXES
Under the laws of Ireland, it is not necessary that any stamp, registration or similar tax be paid on or in relation to the Relevant Transaction Documents or any of them.
34.        EVENT OF DEFAULT
No Event of Default or Potential Event of Default has occurred.

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PART B COVENANTS
Corporate Covenants of the Master Purchaser
The Master Purchaser shall:
1.          FINANCIAL STATEMENTS AND TAX ELECTIONS
(a)         Preparation of Financial Statements
cause to be prepared in respect of each of its financial years, financial statements for audit purposes in such form as will comply with Irish statutory requirements;
(b)         Delivery of Financial Statements
as soon as the same become available, but in any event within 14 days of the date specified under Irish statutory law for the filing of financial statements deliver to the Investment Manager and the Styron Security Trustee two copies of its Financial Statements for such financial year and deliver to the Investment Manager, the Styron Security Trustee, the Instructing Party and the Regency Noteholder as soon as practicable following the issue or giving of the same two copies of every balance sheet, profit and loss account, source and application of funds statement (if any), report or other notice, statement, circular or document issued or given to any holder of securities or creditors generally of the Master Purchaser;
(c)         Certificate to accompany Financial Statements
on the Determination Date immediately preceding each anniversary of the Closing Date and otherwise forthwith on request by the Styron Security Trustee deliver a certificate signed by two directors of the Master Purchaser stating that no Event of Default or Potential Event of Default has occurred (or, if such is not the case, specifying the particulars of any Event of Default or Potential Event of Default);
2.          CONDUCT
at all times carry on and conduct its affairs in a proper and efficient manner in compliance with any Requirement of Law and any Regulatory Direction from time to time in force in Ireland or in any other jurisdiction in which it carries on business and in compliance with its constitutional documents;
3.          CONSENTS
obtain, comply with the terms of and do all that is necessary to maintain in full force and effect all authorisations, approvals, licences and consents necessary under any Requirement of Law and any Regulatory Direction from time to time in force in Ireland or in any other applicable jurisdiction:
(a)        in connection with its business; and
(b)          to enable it lawfully to enter into and perform its obligations under the Relevant Transaction Documents and the Notes or to ensure the legality, validity, enforceability or admissibility in evidence in Ireland of the Relevant

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Transaction Documents and the Notes including any registration required under the Irish Companies Acts 1963 - 2009;
4.          AUTHORISED SIGNATORIES
deliver to the Styron Security Trustee (with a copy to the Investment Manager) on the Closing Date and thereafter upon any change of the same, a list of Authorised Signatories of the Master Purchaser together with a specimen signature of each Authorised Signatory;
5.          REGISTERED OFFICE, HEAD OFFICE AND CENTRE OF MAIN INTERESTS
maintain its registered office, its head office and its “centre of main interests”, as that term is used in Article 3(1) of the EU Insolvency Regulation, in Ireland and will not move such offices to another jurisdiction;
6.          BOARD MEETINGS, MANAGEMENT AND ADMINISTRATIO N
hold all meetings of the board of directors of the Master Purchaser in Ireland and not hold any such meeting outside Ireland and procure that the Master Purchaser’s management, the places of residence of the directors of the Master Purchaser and the place where the Master Purchaser effects its central management and decision-making are all, at all times, situated in Ireland;
7.          NO FOREIGN ESTABLISHMENT
not establish any “establishment”, as that term is used in Article 2(h) of the EU Insolvency Regulation, outside of Ireland; and
8.          GENERAL NEGATIVE COVENANTS
not until after the Final Discharge Date, save to the extent permitted by the Relevant Transaction Documents or with the prior written consent of the Styron Security Trustee:
(a)        carry on any business or enter into any documents other than those contemplated by the Relevant Transaction Documents;
(b)          except as contemplated by the Transaction Documents, sell, convey, transfer, lease, assign or otherwise dispose of or agree or attempt or purport to sell, convey, transfer, lease or otherwise dispose of or use, invest or otherwise deal with any of its properties, assets or undertaking or grant any option or right to acquire the same;
(c)          grant, create or permit to exist any Encumbrance over (including the grant of security or trust over or the occurrence of execution or diligence in respect of) the Assigned Rights other than any Permitted Encumbrance;
(d)        pay dividends or make other distributions to its members out of profits available for distribution and then only in the manner permitted by its constitutional documents of Association and by applicable laws;

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(e)          incur or permit to subsist any indebtedness whatsoever;
(f)        make any loans, grant any credit or give any guarantee or indemnity to or for the benefit of any person or otherwise voluntarily assume any liability, whether actual or contingent, in respect of any obligation of any other person;
(f)        consolidate or merge with any other person;
(g)        surrender any losses to any other company;
(h)        have any employees or premises or have any subsidiary or become a director of any company;
(i)           have an interest in any bank account other than the Accounts unless such account or interest is charged to the Trustee on terms acceptable to it;
(j)         amend, supplement or otherwise modify its constitutional documents;
(k)          permit the validity or effectiveness of the Styron Security Deed or of the Security to be impaired or to be amended, hypothecated, subordinated, terminated or discharged; or
(l)           prejudice its status as a qualifying company within the meaning of section 110 of the Taxes Consolidation Act 1997 of Ireland.

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Transaction Document Covenants of the Master Purchaser
The Master Purchaser shall:
9.          COMPLIANCE WITH RELEVANT TRANSACTION DOCUMENTS
at all times comply with and perform all its obligations under the Relevant Transaction Documents and the Notes and use all reasonable endeavours to procure that the other Transaction Parties, other than the Styron Security Trustee, comply with and perform all their respective obligations under the Relevant Transaction Documents;
10.        EXERCISE RIGHTS
preserve or exercise or enforce its rights under and pursuant to the Notes and the Relevant Transaction Documents;
11.        DEALING WITH STYRON SECURITY TRUSTEE
(a)         Inspection by Styron Security Trustee
upon reasonable notice, during normal business hours allow the Styron Security Trustee and any persons appointed by the Styron Security Trustee access to such books of account and other business records relating to the Assigned Rights or the Benefit of the Assigned Rights as the Styron Security Trustee or any such persons may reasonably require and to the extent that such business records are in its possession or it is able to obtain possession;
(b)         Information to Styron Security Trustee
at all times give to the Styron Security Trustee such information, opinions, certificates and other evidence as the Styron Security Trustee and any persons appointed by the Styron Security Trustee shall reasonably require (and which it is reasonably practicable to produce) for the purposes of the discharge of the duties, trusts, powers, authorities and discretions vested in the Styron Security Trustee by or pursuant to the Styron Security Deed or any other Relevant Transaction Document;
12.        NOTIFICATION OF BREACH OF MASTER PURCHASER WARRANTIES AND UNDERTAKINGS
immediately notify the Investment Manager, the Styron Security Trustee and the Instructing Party if the Master Purchaser becomes aware of any breach of the Master Purchaser Warranties or of any breach of any undertaking given by the Master Purchaser in any Relevant Transaction Documents;
13.        LEGAL PROCEEDINGS
(a)         Notification of Legal Proceedings
if any legal proceedings are instituted against it by any of its creditors or in respect of any of the Assigned Rights, including any litigation or claim calling into question in any material way the Master Purchaser’s interest therein, immediately:

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(i)           notify the Investment Manager, the Calculation Agent, the Styron Security Trustee and the Instructing Party of such proceedings; and
(ii)       notify the court and any receiver appointed in respect of the property the subject of such proceedings of the interests of the Styron Security Trustee in the Assigned Rights;
(b)         Join in Legal Proceedings
if the Styron Security Trustee so requires the Master Purchaser will join in any legal proceedings brought by the Styron Security Trustee against any person;
14.        EXECUTION OF FURTHER DOCUMENTS
perform any act required by any Requirement of Law or any Regulatory Direction to be performed, and so far as permitted by applicable law, execute such further documents and perform such further acts as may be reasonably incidental to, or reasonably necessary in the opinion of the Styron Security Trustee to give effect to, the Relevant Transaction Documents;
15.        NOTIFICATION OF EVENT OF DEFAULT
deliver notice to the Styron Security Trustee, the Instructing Party, the Regency Noteholder and the Investment Manager forthwith upon becoming aware of any Event of Default or Potential Event of Default without waiting for the Styron Security Trustee to take any further action;
16.        NO ENCUMBRANCES
not create or permit to subsist any Encumbrance in respect of the Master Purchaser Account or any assets of the Master Purchaser other than pursuant to the Styron Security Deed, the German Security Assignment and Trust Agreement and the U.S. Security Agreement or save as permitted by the Relevant Transaction Documents;
17.        NO VARIATION AND TERMINATION OF RELEVANT TRANSACTION DOCUMENTS
not until the Final Discharge Date, save to the extent permitted by the Relevant Transaction Documents or with the prior written consent of the Styron Security Trustee:
(a)        terminate, repudiate, rescind or discharge any Relevant Transaction Document;
(b)        vary, novate, amend, modify or waive any material provision of any Relevant Transaction Document;
(c)        permit any person to do any of the things specified in Paragraph (a) or (b); or
(d)        permit any person who has obligations under the Relevant Transaction Documents to be released from such obligations other than in accordance with the terms of the applicable Relevant Transaction Document and any applicable Requirement of Law or Regulatory Direction; and

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18.        FILINGS
effect all Required Filings in respect of the Master Purchaser and file, record or enroll each Relevant Transaction Document required to be filed, recorded or enrolled with any court or other authority in Ireland and ensure that such Required Filings and such other filings, recordings or enrolments are at all times maintained in accordance with any applicable Requirement of Law or Regulatory Direction.

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Asset Covenants of the Master Purchaser
The Master Purchaser shall:
19.        BOOKS OF ACCOUNT
maintain, or procure that the Investment Manager maintains, clear and unambiguous records and books of account in respect of the Assigned Rights and all Collections received in respect of the Assigned Rights;
20.        NOTIFICATION OF LITIGATION
promptly notify the Servicers, the Styron Security Trustee and the Regency Noteholder if the Master Purchaser receives, after the Closing Date in respect of any Assigned Rights, any notice of any litigation in relation to any of such Assigned Rights including any litigation or claim calling into question the Master Purchaser’s interest in any Assigned Rights;
21.        PARTICIPATION IN LITIGATION
if reasonably required to do so by a Servicer, the Styron Security Trustee and the Regency Noteholder participate in or join in and lend its name to, and take such other steps as may be required by the Servicers, the Styron Security Trustee, the Instructing Party and the Regency Noteholder (as the case may be) in relation to any action (through the courts or otherwise) relating to any Assigned Rights after the Closing Date in respect of such Assigned Rights, including participation in any legal proceedings to the extent necessary for defending or contesting any litigation in relation to such Assigned Rights including any litigation or claim calling into question in any material way the Master Purchaser’s interest in any such Assigned Rights;
22.        INTERESTS IN THE ASSIGNED RIGHTS
at all times own and exercise its rights in respect of the Assigned Rights and its interest in the Assigned Rights and perform and comply with its obligations in respect of the Assigned Rights under the terms of the Relevant Transaction Documents;
23.        FURTHER ACTION
perform any act incidental to or necessary in connection with the other covenants contained in this Schedule 10 ( Master Purchaser Covenants ) or any act required by any law, regulation or order of any court to be performed; and
24.        NEGATIVE COVENANT
not until the Final Discharge Date, save to the extent permitted by the Transaction Documents, permit any person other than the Master Purchaser and the Styron Security Trustee to have any interest in the Assigned Rights.

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Covenants of the Master Purchaser in respect of the Notes
The Master Purchaser shall:
25.        NOTIFICATION OF NON PAYMENT
procure that the Investment Manager, German Servicer, the Dutch Servicer and the U.S. Servicer notify the Styron Security Trustee forthwith if they do not, on or before the due date for payment in respect of the Notes or any of them, receive unconditionally the full amount in US Dollars or Euro, as applicable, of the monies payable on such due date under the Notes;
26.        NOTIFICATION OF LATE PAYMENT
if unconditional payment to the Investment Manager, the German Servicer, the Dutch Servicer, the U.S. Servicer, the Styron Security Trustee or any Noteholder of any sum due in respect of the Notes is made after the due date for such payment, forthwith give notice to the Regency Noteholder that such payment has been made;
27.        NOTIFICATION OF REDEMPTION OR REPAYMENT
not less than the number of days specified in the relevant Conditions prior to the redemption or Payment Date in respect of any Note, give to the Styron Security Trustee notice in writing of the amount of such redemption or repayment pursuant to the Conditions;
28.        TAX OR OPTIONAL REPAYMENT
if the Master Purchaser gives notice to the Styron Security Trustee that it intends to redeem the Notes pursuant to Condition 3.1 ( Redemption at the Option of the Master Purchaser ) or Condition 3.4 ( Redemption due to Tax Event ), provide such information to the Styron Security Trustee as the Styron Security Trustee requires in order to satisfy itself of the matters referred to in those Clauses;
29.        LIABILITY TO TAX
promptly give notice to the Styron Security Trustee:
(a)        if it is required by law to effect a Tax Deduction in respect of any payment due in respect of the Notes; or
(b)        if it would not be entitled to relief for Tax purposes in Ireland for any material amount which it is obliged to pay, or is treated as receiving for Tax purposes in Ireland under the Transaction Documents; or becomes aware that it is or may become liable to Tax; or
(c)        if, as a result of any change of law or official practice in any jurisdiction which occurs or which the Master Purchaser discovers (in each case) after the date hereof, it becomes liable to Tax, or incurs any increased liability to Tax, in respect of its income or activities or in respect of any of the Assigned Rights;

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and take such action as may be required by the Styron Security Trustee in respect thereof; and
30.        INSTRUCTING PARTY
while any of the Notes remain outstanding, give notice, or procure that notice is given, to the Instructing Party of:
(a)        any proposed amendment to the Transaction Documents which is not of a formal, minor or technical nature or made to correct a manifest error;
(b)        the Notes of any class being repaid in full;
(c)        the delivery of a Swiss Servicer Default, German Servicer Default, Dutch Servicer Default or U.S. Servicer Default;
(d)          the delivery of a notice pursuant to Clause 14 ( Termination of Appointmen t) of the Swiss Servicing Agreement, the German Servicing Agreement or the Dutch Servicing Agreement or pursuant to Clause 15 ( Termination of Appointment ) of the U.S. Servicing Agreement;
(e)        the appointment of a Successor Trustee or a Successor Investment Manager;
(f)        the occurrence of any Cash Control Event, Perfection Event or Termination Event;
(g)        the occurrence of any Event of Default or Potential Event of Default; and
(h)        the delivery of an Enforcement Notice.

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SCHEDULE 8
EVENTS OF DEFAULT
1.         the Master Purchaser fails to pay an amount of principal or interest or any other amount in respect of the Notes; or
2.         the Master Purchaser defaults in the performance or observance of any of its other obligations under or in respect of the Notes or the Transaction Documents and such default (a) is, in the opinion of the Styron Security Trustee, incapable of remedy or (b) being a default which is, in the opinion of the Styron Security Trustee, capable of remedy, remains unremedied for 5 days or such longer period as the Styron Security Trustee may agree after the Styron Security Trustee has given written notice thereof to the Master Purchaser; or
3.         an Insolvency Event occurs with respect to the Master Purchaser; or
4.         it is or will become unlawful for the Master Purchaser to perform or comply with any of its obligations under or in respect of the Notes or the Transaction Documents.

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SCHEDULE 9
INITIAL CONDITIONS PRECEDENT
1.          The Seller
(a)          Copies of the latest versions of the articles of association of the Seller certified by the Commercial Register to be a true and up to date copy of the original (where such certification by the Commercial Register shall be dated no earlier than 10 calendar days prior to the Swiss Funding Date).
(b)          Copies of the resolutions, in form and substance satisfactory to the Instructing Party, of the management of the Seller authorising the execution, delivery and performance of the Relevant Transaction Documents, certified by an officer of the relevant company as of the Closing Date and the Swiss Funding Date which certificate shall state that the resolutions thereby certified have not been amended, modified, revoked or rescinded.
(c)          A certificate as to the incumbency and signature of the officers or other employees authorised to sign the Relevant Transaction Documents on behalf of the Seller and any certificate or other document to be delivered pursuant thereto, certified by the company secretary or a manager of the Seller together with evidence of the incumbency of such company secretary or director.
(d)          A copy of an up to date certified Commercial Register excerpt in respect of the Seller dated no earlier than 10 calendar days prior to the Swiss Funding Date.
(e)        Solvency Certificates in respect of the Seller in the form set out in Schedule 2 to the Master Receivables Purchase Agreement, one dated the Closing Date and one dated the Swiss Funding Date.
(f)        Delivery of a closing certificate dated the Swiss Funding Date from the Seller.
(g)          A copy of the latest audited financial statements of the Seller.
2.          Parent
(a)          Certified copies of the latest version of the articles of association of the Parent certified by any manager of the Parent to be a true and up to date copy of the original.
(b)          Copies of the resolutions, in form and substance satisfactory to the Instructing Party, of the board of managers of the Parent authorising the execution, delivery and performance of the Relevant Transaction Documents, certified by a manager of the relevant company as of the Closing Date and the Swiss Funding Date which certificate shall state that the resolutions thereby certified have not been amended, modified, revoked or rescinded.
(c)          A certificate as to the incumbency and signature of the managers or other attorneys authorised to sign the Relevant Transaction Documents on behalf of the Parent and any certificate or other document to be delivered pursuant thereto, certified by any manager of the Parent together with evidence of the incumbency of such manager.
(d)          Up to date Commercial Register excerpts in respect of the Parent dated no earlier than 10 calendar days prior to the Swiss Funding Date.

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(e)          Solvency certificates in respect of the Parent, one dated the Closing Date and one dated the Swiss Funding Date, in such form as may be approved by the Instructing Party.
(f)        A certificate from the Luxembourg Register of commerce and companies certifying the status of non bankruptcy (faillites) of the Parent.
3.          The Master Purchaser
(a)          Certified copies of the latest versions of the memorandum and articles of association of the Master Purchaser together with the certificate of incorporation and any certificate change of name certified by the company secretary or a director of the Master Purchaser to be a true and up to date copy of the original.
(b)          Copies of the resolutions, in form and substance satisfactory to the Instructing Party, of the boards of directors of the Master Purchaser authorising the execution, delivery and performance of the Relevant Transaction Documents, certified by an officer of the relevant company as of the Closing Date and the Swiss Funding Date which certificate shall state that the resolutions thereby certified have not been amended, modified, revoked or rescinded.
(c)          A certificate as to the incumbency and signature of the officers or other employees authorised to sign the Relevant Transaction Documents on behalf of the Master Purchaser and any certificate or other document to be delivered pursuant thereto, certified by the company secretary or a director of the Master Purchaser together with evidence of the incumbency of such company secretary or director.
(d)          A certified copy of the power of attorney granted by the Master Purchaser to the attorneys of the Master Purchaser authorised to sign the Transaction Documents on behalf of the Master Purchaser.
(e)          A solvency certificate in respect of the Master Purchaser in the form set out in Schedule 2 to the Master Receivables Purchase Agreement, one dated the Closing Date and one dated the Swiss Funding Date.
(f)        Delivery of a closing certificate dated the Swiss Funding Date from the Master Purchaser.
4.          Legal Opinions and Reports
(a)          Clifford Chance English transaction legal opinion addressed to HSBC Bank plc, the Master Purchaser, the Regency Noteholder and the Styron Security Trustee as to the enforceability of the Transaction Documents governed by English law dated the Swiss Funding Date.
(b)          Walder Wyss & Partners Swiss transaction legal opinion as to true sale addressed to HSBC Bank plc, the Master Purchaser, the Regency Noteholder and the Styron Security Trustee dated the Swiss Funding Date.
(c)          Walder Wyss & Partners Swiss tax opinion addressed to HSBC Bank plc, the Master Purchaser, the Regency Noteholder and the Styron Security Trustee dated the Swiss Funding Date.

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(d)          Matheson Ormsby Prentice Irish transaction legal opinion addressed to, among others, HSBC Bank plc, the Master Purchaser, the Regency Noteholder and the Styron Security Trustee on the capacity and authority of the Master Purchaser dated the Swiss Funding Date.
(e)        Matheson Ormsby Prentice Irish tax opinion addressed to, among others, HSBC Bank plc, the Master Purchaser, the Regency Noteholder and the Styron Security Trustee dated the Swiss Funding Date.
(f)        Matheson Ormsby Prentice Irish legal opinion addressed to, among others, HSBC Bank plc and the Regency Noteholder, in respect of Regency Assets Designated Activity Company and the Liquidity Facility Agreement dated on or prior to the Swiss Funding Date.
(g)          Homburger Swiss legal opinion addressed to HSBC Bank plc, the Master Purchaser, the Regency Noteholder and the Styron Security Trustee on the capacity and authority of the Seller dated the Swiss Funding Date.
(h)          Loyens & Loeff Luxembourg legal opinion addressed to, HSBC Bank plc, the Master Purchaser, the Regency Noteholder and the Styron Security Trustee on the capacity and authority of the Parent dated the Swiss Funding Date.
(i)        A legal review report relating to the location of Obligors.
(j)        A legal review summary in respect of the Receivables.
(k)          Clifford Chance Frankfurt legal opinion on the enforceability of the German Account Pledge Agreement.
(l)         Clifford Chance Madrid legal opinion on the enforceability of the Spanish Account Control Agreement.
5.          Fees
(a)          Compliance with the terms of the Fee Letter, including the payment in full of all fees, expenses and other amounts payable under the Fee Letter on or prior to the Swiss Funding Date.
(b)          Evidence that the fees, costs and expenses then due from each Swiss Seller have been paid or will be paid by the Swiss Funding Date.
6.          General
(a)        Due execution and delivery of the Transaction Documents (each in a form satisfactory to the Instructing Party) by the respective parties thereto, and all documentation to be delivered therewith (in a form satisfactory to the Instructing Party).
(b)       Confirmation from each of the Rating Agencies that upon execution of the Variable Loan Note Issuance Deed, the Regency Notes will maintain their then current rating.
(c)       In the opinion of the Investment Manager, there having been no material adverse change or development which could affect the Seller or the Master Purchaser.

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(d)          Issuance by the Master Purchaser of the Styron Note and the Regency Note and confirmation of payment by the Regency Noteholder.
(e)        Evidence of execution of and satisfaction of the conditions precedent to the Liquidity Facility Agreement and Master Receivables Purchase Agreement.
(f)        The delivery of the Investment Manager’s Daily Report three days prior to the Swiss Funding Date.
(g)          The accuracy and completeness of all material representations set forth in the Transaction Documents by reference to the facts and circumstances existing as at the date such representations are given.
(h)          The Master Purchaser Warranties are true on the Closing Date and on the Swiss Funding Date.
(i)           Delivery of an Offer pursuant to the Master Receivables Purchase Agreement.
(j)           Receipt by the Master Purchaser of acknowledgements from the Collection Account Bank in respect of Account Control Agreements relating to Collection Accounts held at branches of the Collection Account bank in Frankfurt, London and Madrid.

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SCHEDULE 10
ADDITIONAL CONDITIONS PRECEDENT
(a)        No Termination Event or Potential Termination Event or Event of Default or Potential Event of Default shall have occurred and be continuing unwaived.
(b)          The Aggregate Note Principal Amount Outstanding including the Additional Principal Amount requested will not exceed the Total Facility Limit and the Aggregate Regency Note Principal Amount Outstanding including the Additional Principal Amount requested will not exceed the Facility Limit.
(c)          In the case of the Regency Noteholder only, any Styron Note Additional Principal Amount relating to the request is available and paid by the Styron Noteholder.
(d)          The Transaction Documents remain valid and binding.
(e)          An Initial Purchase Price Payment Request from the Seller relating to the relevant Settlement Date has been duly signed.
(f)        A solvency certificate in respect of the Master Purchaser dated the Settlement Date.
(g)          The delivery of the Investment Manager’s Daily Report three days prior to the relevant Settlement Date.
(h)          The Master Purchaser representations are true on the relevant Settlement Date.

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SCHEDULE 11
STANDARD DOCUMENTATION
PART A
SWISS DOCUMENTATION

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GENERAL TERMS AND CONDITIONS
1.        Interpretation of  Trade  Terms
Trade terms shall be interpreted in accordance with INCOTERMS 2010. If this Contract does not specify trade terms as defined in INCOTERMS 2010, risk of loss shall pass to Buyer upon delivery into the custody of the carrier.
2.         Seller's Commitments
2.1      Seller undertakes that the Product will at the time of delivery meet Seller's then current Sales Specifications. Seller will notify Buyer if Sales Specifications are changed. All descriptions, drawings, photographs, illustrations, performance and technical data, dimensions, weights and the like, contained in any promotional or technical literature issued by Seller are subject to variation without notice and are not designed to constitute Sales Specifications.
2.2     Seller will supply Buyer with current Material Safety Data Sheets (MSDS) regarding the Product.
2.3      Subject to Section 7 hereof, Seller will convey the Product with good title, free from any lawful lien or encumbrance.
3.        Responsible Practices
3.1     Buyer will (i) familiarise itself with any product literature or information Seller provides under Seller's product stewardship program, including MSDS, (ii) follow safe handling, use, selling, storage, transportation, and disposal practices, including special practices as Buyer's use of the Product requires, and instruct its employees, contractors, agents and Buyers in these practices and (iii) take appropriate action to avoid spills or other dangers to persons, property or the environment. Seller may cancel this Contract on 15 days notice if Buyer fails to comply with any of its commitments under this subsection.
3.2     Notwithstanding the provisions of Article 5 of this Contract, Buyer will indemnify Seller for all claims, damages and related costs, including reasonable attorney fees, arising out of Buyer's noncompliance with any of its commitments under Article 3.1 above.
4.        Patents/Trademarks
Seller warrants only that the manufacture of the Product covered by this Contract does not infringe any Letters Patent of the country of manufacture. Buyer assumes all responsibility for use of any design, trademark, trade name, or part thereof, appearing on the Product at Buyer's request.
5.        Warranty/Liability
5.1      The commitments set out in Articles 2 and 4 above are Seller's sole warranties in respect of the Product. ANY OTHER CONDITION OR WARRANTY AS TO THE QUALITY OF THE PRODUCT SUPPLIED UNDER THIS CONTRACT OR FITNESS FOR ANY PARTICULAR PURPOSE WHETHER ARISING UNDER STATUTE OR OTHERWISE, IS EXCLUDED. Articles 192 – 196 and Art. 197 – 209 of the Swiss Code of Obligations (warranty with regard to title transfer and against defects of the purchase object) are explicitly excluded and do not apply.
5.2      Buyer shall inspect the Product supplied under this Contract immediately after delivery. If any of the supplied Product is rejected because of nonconformity to specifications, Buyer shall have the right to return it to Seller only after inspection by Seller and receipt of definite shipping instructions from Seller, such inspection to be made and instructions to be given by Seller within thirty (30) days after written notice of rejection by Buyer. Either, (1) failure to give written notice of any claim within thirty (30) days from the date of delivery or, (2) use of the Product supplied under this Contract, constitutes an

 
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unqualified acceptance of such Product by Buyer and a waiver by Buyer of all claims against Seller in respect of such Product. In case after inspection Seller decides that Buyer has a right to return the Product because of its non-conformity to specifications, Seller has the right to choose between remediation of the non-conformity of the originally delivered Product or delivery of a new Product to Buyer.
5.3     In the event of any liability by either party whether arising from breach of contract or from statutes it is agreed that the maximum amount of damages recoverable shall be limited to the contract price for the Product with respect to which damages are claimed. In no event shall either Seller or Buyer be liable for indirect, consequential, special, punitive or exemplary damages in connection with or arising out of this Contract.
6.       Price and Terms
6.1     Seller may change the previously agreed price, terms and conditions of payment or of transportation, or the minimum requirement per shipment at any time, by fifteen (15) days prior written notice to Buyer. Buyer's failure to make written objection to the change prior to the effective date shall be considered acceptance. If Buyer objects within the 15 day period, Seller shall have the option (a) to continue to supply on the terms and conditions in effect prior to the announced change, or (b) to cancel the affected Product quantities immediately and shall advise Buyer accordingly within fifteen (15) days from receipt of Buyer's written objection.
6.2    Seller reserves the right by written notice given at any time before shipment to increase the price under this Contract if there is any increase in the price or cost of the Product to Seller by virtue of foreign exchange fluctuations, currency regulations, changes in duties or taxes, increase in the cost of raw materials, labour or transport or any other causes beyond the control of Seller. If Buyer is of the opinion that any such increase in price is unreasonable, it may object to such increase by written notice given within fifteen (15) days of the date of receipt of Seller's notice; Seller shall then have the option to continue to supply Buyer at the price currently in effect if willing to do so or to cancel the Contract immediately in writing.
7.        Title
7.1     If Products are delivered to destinations in Switzerland or to other destinations where reservation of title of goods is not permissible, title to the Products shall pass at the same time as the risk of loss passes to Buyer.
7.2     If Products are delivered to destinations outside of Switzerland and if permissible under the laws of the country of destination, title to the Product shall remain with Seller until payment in full has been received by Seller. Until the title to the Product has transferred
(a)       the Product shall so far as practicable be kept separate from other goods on the premises of Buyer so as to be readily identifiable as goods of Seller and
(b)       Buyer shall be entitled to resell the Product in the ordinary course of business or to use the Product in any process provided that such liberty shall be deemed automatically terminated without the need for notice if Buyer shall fail to make any payment when it becomes due, or shall default in due performance or observance of any other obligation under this Contract, or shall enter into or apply for liquidation or receivership. Seller may then by notice in writing to Buyer terminate the Contract. Upon such termination Seller shall be entitled to enter upon Buyer's premises in order to remove any of the Product to which Seller has retained title and for this purpose Buyer shall afford Seller all reasonable assistance to locate and take possession of the Product.
7.3      Upon termination of Buyer's liberty to resell or use the Product it shall promptly place the Product at Seller's disposal and Seller shall be entitled to enter upon Buyer's premises for the purpose of removing the Product.

 
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7.4     For the purpose of the foregoing paragraphs of this Condition and in the absence of evidence to the contrary Product supplied by Seller to Buyer at any time shall be deemed to have been resold, used or processed in the order in which Product was supplied. Nothing herein shall give Buyer the right to return the Product to Seller.
8.       Schedule of Deliveries
Buyer shall schedule deliveries of the Product uniformly throughout the calendar year. Not more than ten percent (10%) of the annual quantity of the Product shall be scheduled for delivery in any calendar month, except with Seller's prior written consent.
9.       Transportation
Where the price provides for absorption by Seller of any portion of the freight charges or where Seller provides the transportation equipment at its cost, Seller shall have the right to select the means of transportation. Where the price provides for payment by Buyer of any portion of the freight charges, the freight charges will be those in effect at the date of shipment.
10.     Delivery Equipment
During the time that Seller's delivery equipment is in the possession of Buyer, Buyer shall be liable to Seller for damages or destruction of such equipment attributable to Buyer. All repairs to equipment shall be made under the supervision or direction of Seller.
11.     Force Majeure
In the event of accident, mechanical breakdown of facilities, fire, flood, strike, labour trouble, riot, revolt, war, acts of governmental authority, acts of God, or contingencies beyond the reasonable control of the party affected interfering with the performance of this Contract the quantity of Product provided for in this Contract shall be reduced by the amount so affected without liability but the Contract shall otherwise remain unchanged. The decision of the party affected as to the quantities of Product affected shall be final and binding.
12.     Governmental Controls
If the price, freight allowance or terms of payment or any price increase or change in freight allowance or terms of payment under this Contract or Seller's ability to make any such increase or change, should be altered or prohibited by reason of any law, government decree, order or regulation, Seller may cancel this Contract upon fifteen (15) days written notice. However, at its option Seller may by written notice elect to postpone the effective date of any price increase or proposed change to the extent so prevented until such date or dates as it is not so prevented. By electing to postpone rather than cancel, Seller will not waive its right to cancel thereafter because of such continued or further alterations or prohibitions.
13.      Non-performance
13.1    If Buyer fails to perform any of the terms of this Contract when due, Seller may, at its option, decline to make further deliveries against this Contract except for cash, or may recall or defer shipments until such default is made good, or may treat such default as   final refusal to accept further shipments and cancel this Contract.
13.2   Seller reserves the right, without prejudice to Buyer's liability to pay on the due date, to charge interest on any overdue balance at a rate of LIBOR plus 5% Such rights are in addition and without prejudice to any other rights Seller may have under this Contract.
14.      Performance by Affiliates
At Seller's option, any Contract obligation may be performed by TRINSEO Europe GmbH, Horgen, Switzerland, or any of its Affiliates. "Affiliates" means any entity that directly or indirectly, through one or more intermediates, now or hereafter, controls or is controlled by,

 
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or is under common control with TRINSEO Europe GmbH or any entity controlling Trinseo Europe GmbH. For the purposes herein, the term "control" (including the terms "controls", "controlled by", and "under common control with") means the possession, direct or indirect of at least 50% of the ownership. Any deliveries made under this Section 14 may be invoiced by such Affiliate and shall constitute performance of this Contract by Seller.
15.      Assignment/Transfer
Save in relation to a transfer and/or assignment of this Contract or any rights and/or obligations hereunder (and any information relating hereto) in connection with (i) a securitization, factoring or alike financial transaction, or (ii) the sale, divestment and/or reorganization of all or part of the business to which this Contract relates, in each case by Seller, this Contract is neither transferable nor assignable by either party without the other party's prior written consent except that Buyer hereby consents to Seller's potential future assignment of (a) some or all of Seller's obligations hereunder to an Affiliate, or (b) this Contract including all of the Seller's rights and obligations to an Affiliate.
16.      Non-waiver
Failure to exercise any rights under this Contract upon any occasion shall not waive the right to exercise the same on another occasion.
17.      Severability of Provisions
If any provision of this Contract should be held invalid or unenforceable, the validity and enforceability of the remaining provisions shall not be affected. Any invalid or unenforceable provision shall be replaced with a new provision which will allow the parties to this Contract to achieve the intended economic result in a legally valid and effective manner.
18.      Applicable Law and Venue
This Contract shall be governed by and construed in accordance with the laws of Switzerland excluding its conflict of laws provisions. The United Nations Convention on Contracts for the International Sale of Goods (1980) shall not apply to this Contract.
Exclusive venue for all disputes arising from the Contract and any sales contract concluded hereunder shall be Zurich, Switzerland. The Seller shall also be entitled, however, to take legal action before the competent court having jurisdiction for the Buyer's registered office.
19.      Controlling Terms & Amendments
By ordering any of the Product detailed in this Contract, Buyer agrees to all the terms and conditions set forth herein which override any additional or different terms or conditions included in Buyer's purchase order or referred to by Buyer. Any amendments or additions to this Contract shall be valid only if in writing and signed by both parties.

 

 
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PART B
GERMAN DOCUMENTATION
STYRON ALLGEMEINE VERKAUFS- UND LIEFERBEDINGUNGEN
I.        Geltungsbereich
1 . Unsere Verkäufe, Lieferungen und Leistungen (im Folgenden einheitlich: „Lieferungen“) erfolgen nur nach Maßgabe der nachstehenden Bedingungen. Sie finden Anwendung gegenüber Unternehmern, juristischen Personen des öffentlichen Rechts und öffentlich-rechtlichen Sondervermögen (Käufer). Der Käufer erklärt sich durch deren widerspruchslose Entgegennahme mit ihrer ausschließlichen Geltung für die jeweilige Lieferung sowie für alle Folgegeschäfte einverstanden. Entgegenstehende oder von unseren Bedingungen abweichende Bedingungen des Käufers erkennen wir nicht an, es sei denn, wir hätten ihrer Geltung ausdrücklich schriftlich zugestimmt. Unsere Bedingungen gelten auch dann, wenn wir in Kenntnis entgegenstehender oder von unseren Bedingungen abweichender Bedingungen des Käufers die Lieferung an den Käufer vorbehaltlos ausführen.
2. Wir behalten uns vor, unsere Allgemeinen Verkaufsbedingungen von Zeit zu Zeit zu ändern. Der Käufer erklärt sein Einverständnis mit der ausschließlichen Geltung der geänderten Bedingungen, wenn er nicht innerhalb einer Woche nach Zugang bei ihm der Geltung schriftlich widerspricht und er von uns anlässlich der Bekanntgabe der geänderten Bedingungen auf die Bedeutung seines Verhaltens besonders hingewiesen wurde.
II.       Angebot, Muster, Garantien, Vertragsschluss
1 . Unsere Angebote sind bezüglich Preis, Menge, Lieferfrist und Liefermöglichkeit freibleibend. Angebote können nur binnen 30 Tagen angenommen werden.
2 . Die in Datenblättern, Broschüren und anderem Werbe- und Informationsmaterial enthaltenen Informationen und Daten dienen nur als Richtschnur und werden nur dann verbindlicher Vertragsinhalt, wenn wir dem ausdrücklich schriftlich zugestimmt haben.
3 . Eigenschaften von Mustern und Proben sind nur dann verbindlich, wenn dies ausdrücklich vereinbart wurde.
4. Beschaffenheits- und Haltbarkeitsangaben gelten nur dann als Garantien, wenn sie ausdrücklich als solche bezeichnet werden. Dasselbe gilt für die Übernahme eines Beschaffungsrisikos.
5. Der Vertrag ist erst dann für uns verbindlich, wenn wir die Auftragsbestätigung schriftlich erteilen. Mündliche Abreden bedürfen der schriftlichen Bestätigung durch uns.
III.     Preise, Zahlung, Verzug, Beendigung bei Insolvenzantrag
1. Die Preise verstehen sich ausschließlich gesetzlicher Mehrwertsteuer, äußerer Verpackung und Versandkosten (ab Werk).
2. Alle Preise beruhen auf den Kostenfaktoren im Zeitpunkt des Vertragsschlusses bzw. der Auftragsbestätigung. Treten danach wesentliche Erhöhungen der Kosten für Rohstoffe, Energie, Frachten oder Verpackungsmaterial bei uns oder unserem Lieferanten ein und führen diese zu einer wesentlichen Erhöhung unserer Einkaufspreise oder Selbstkosten, so sind wir berechtigt, unverzüglich mit dem Käufer Verhandlungen über eine Preisanpassung zu verlangen. Kommt innerhalb angemessener Frist eine Übereinkunft nicht zustande, so sind wir bezüglich noch ausstehender Lieferungen von unserer Lieferpflicht entbunden.
3. Unsere Rechnungen sind innerhalb der vereinbarten Zahlungsfrist zu bezahlen, spätestens 30 Tage ab Rechnungsdatum .
Maßgebend für die Einhaltung von Zahlungsfristen ist der Eingang der Zahlung auf unseren Konten. Schecks werden nur zahlungshalber angenommen. Anfallende Spesen gehen zu Lasten des Käufers.
4. Bei Zahlungsverzug werden Zinsen in Höhe von 8 Prozentpunkten jährlich über dem jeweiligen Basiszinssatz (§ 247 BGB) fällig. Der Nachweis eines weitergehenden Verzugsschadens bleibt vorbehalten.
5. Wir sind zur Erfüllung des Vertrages solange nicht verpflichtet, wie der Käufer seinen Pflichten auch aus anderen Verträgen mit uns nicht vereinbarungsgemäß nachkommt, insbesondere fällige Rechnungen nicht bezahlt.
6. Der Käufer kann nur mit solchen Ansprüchen aufrechnen oder ihretwegen die Zahlung zurückhalten, die schriftlich unbestritten oder rechtskräftig festgestellt sind.
7. Wir sind berechtigt, ausstehende Lieferungen nur gegen Vorkasse durchzuführen oder von der Stellung einer Sicherheit abhängig zu machen, wenn der Käufer mit vereinbarten Zahlungszielen auch nach Ablauf einer angemessenen Nachfrist in Verzug ist oder Umstände vorliegen, die bei Anlegung banküblicher Maßstäbe Zweifel an der Zahlungsfähigkeit des Käufers begründen. In diesen Fällen sind wir darüber hinaus berechtigt, alle Forderungen gegen den Käufer aus der Geschäftsverbindung sofort fällig zu stellen.
8. Dieser Kaufvertrag endet automatisch, wenn ein Antrag auf Eröffnung eines Insolvenzverfahrens über das Vermögen des Käufers ge stellt wird und das zuständige Insolvenzgericht daraufhin Sicherungsmaßnahmen gemäß §§ 21, 22 InsO anordnet.
IV.      Lieferung und Lieferzeiten, Verpackung, Gefahrübergang
1 . Für Art und Umfang der Lieferung ist unsere schriftliche Auftragsbestätigung maßgebend. Wir sind zu Teillieferungen berechtigt, soweit sie für den Käufer zumutbar sind.
2. Lieferfristen gelten nur annähernd, sofern sie nicht ausdrücklich schriftlich als verbindlich zugesagt wurden. Die Lieferzeit beginnt mit der Absendung unserer Auftragsbestätigung, jedoch nicht vor Klärung aller für die Durchführung des Vertrages wesentlichen Fragen im Zusammenhang mit vom Käufer vorzunehmenden Handlungen. Insbesondere beginnt die Lieferzeit nicht, bevor wir vom Käufer oder dessen Vertreter alle für die Lieferung benötigten Informationen erhalten bzw. bevor der Käufer nachweist, dass er, soweit erforderlich, vertragsgemäß ein Akkreditiv eröffnet oder eine Vorauszahlung bzw. Sicherheit geleistet hat.

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3. Die Lieferfrist ist eingehalten, wenn bis zu ihrem Ablauf der Leistungsgegenstand unser Werk verlassen hat oder unsere Lieferbereitschaft mitgeteilt ist.
4 . Alle Fälle von höherer Gewalt, Streik, Aussperrung, unzureichender Material-, Rohstoff- oder Energieversorgung, Mangel an Transportmöglichkeiten und andere ähnliche Ereignisse oder Ursachen außerhalb unseres Einwirkungsbereiches entbinden uns für die Zeitdauer und den Umfang solcher Hindernisse von unserer Verpflichtung zur Erfüllung des Vertrages. Dies gilt auch, wenn diese Umstände bei unseren Zulieferern eintreten. Die vorbezeichneten Umstände sind auch dann von uns nicht zu vertreten, wenn sie während eines bereits vorliegenden Verzuges eintreten. Beginn und Ende solcher Hinderungsgründe teilen wir dem Käufer baldmöglichst schriftlich mit.
5. Falls Lieferung einer Gesamtmenge in mehreren Abrufen vereinbart ist, hat der Käufer die Einzellieferungen gleichmäßig über das Kalenderjahr zu verteilen. Falls in einem Kalendermonat mehr als 10% des jährlichen Lieferumfangs abgerufen werden soll, bedarf dies unserer vorherigen, schriftlichen Zustimmung.
6. Wir bestimmen die Art der Verpackung und des Versands.
7. Die Gefahr geht spätestens mit der Absendung des Leistungsgegenstandes auf den Käufer über, und zwar auch dann, wenn wir zusätzliche Leistungen wie Verladung, Transport oder Entladung übernommen haben. Verzögert sich die Lieferung infolge von Umständen, die der Käufer zu vertreten hat, geht die Preisgefahr am Tag der Mitteilung der Lieferbereitschaft auf ihn über. Auf Verlangen des Käufers versichern wir die jeweilige Sendung auf seine Kosten gegen Diebstahl, Bruch-, Transport-, Feuer- und Wasserschäden.
8. Beanstandungen wegen Transportverzögerungen, Fehlmeldungen oder Transportschäden hat der Käufer unverzüglich gegenüber unserem Spediteur und Frachtführer geltend zu machen und uns dies unverzüglich mitzuteilen.
9. Wir sind auch nicht verpflichtet, auf Geheiß des Käufers an Dritte zu liefern.
V.       Mängelansprüche, Pflichten des Käufers bei Mängelanzeige durch seine Kunden, Aufwendungsersatz, Haftung
1. Mängelansprüche des Käufers setzen voraus, dass er seinen gesetzlichen Untersuchungs- und Rügepflichten ordnungsgemäß nachgekommen ist. Bei offensichtlicher Mangelhaftigkeit oder Unvollständigkeit der Ware sind uns die Beanstandungen innerhalb von 2 Wochen nach Ankunft der Lieferung am Bestimmungsort schriftlich unter genauer Bezeichnung des Fehlers und der Auftrags- bzw. Rechnungsnummer anzuzeigen. Auf unsere Aufforderung sind die auf Lieferung bezogenen Dokumente, Muster, und/oder die fehlerhafte Ware an uns zurückzusenden. Ansprüche des Käufers wegen Mangelhaftigkeit oder Unvollständigkeit der Lieferung sind ausgeschlossen, wenn er dieser Verpflichtung nicht nachkommt. 
2. Sollte die Ware Mängel aufweisen, können wir nach unserer Wahl als Nacherfüllung die Mängel beseitigen oder mangelfreien Ersatz leisten. Erst wenn dies wiederholt fehlgeschlagen oder unzumutbar sein sollte und es sich nicht nur um unerhebliche Mängel handelt, ist der Käufer nach Maßgabe der gesetzlichen Vorschriften zum Rücktritt oder zur Minderung berechtigt. § 478 BGB bleibt unberührt. Schadensersatzansprüche stehen dem Käufer nach Maßgabe von Ziffer V.6.   zu.
Hinsichtlich etwaiger Ersatzlieferungen und Nachbesserungsarbeiten gilt eine Verjährungsfrist von 3 Monaten ab Ablieferung bzw. Ausführung, die aber mindestens bis zum Ablauf der Verjährungsfrist für Mängelansprüche unserer ursprünglichen Leistung läuft (vgl. Ziffer V.9.). 
3 . Der Käufer hat uns unverzüglich über jede Mängelanzeige seines Kunden in Bezug auf unsere Liefergegenstände zu informieren. Kommt der Käufer dieser Verpflichtung nicht nach, hat er keine Mängelansprüche gegen uns, auch keinen Aufwendungsersatzanspruch gemäß § 478 BGB. Der Käufer hat zudem Beweise in geeigneter Form zu sichern und uns auf Verlangen Gelegenheit zur Überprüfung zu geben.
4. Nicht von uns vorab autorisierte Werbeaussagen des Käufers in seinen Werbematerialien oder gegenüber seinen Kunden begründen keine Mängelansprüche gegen uns.
5.        Mängelansprüche bestehen nicht bei nur unerheblicher Abweichung von der vereinbarten Beschaffenheit und/ oder bei nur unerheblicher Beeinträchtigung der Brauchbarkeit. Wir haften nicht für die Eignung der Ware für die vom Käufer beabsichtigten Zwecke, es sei denn, der beabsichtigte Zweck ist schriftlicher Vertragsinhalt.
6.        Wir haften unbeschränkt nach dem Produkthaftungsgesetz, in Fällen der ausdrücklichen Übernahme einer Garantie oder eines Beschaffungsrisikos sowie wegen vorsätzlicher oder grob fahrlässiger Pflichtverletzungen. Ebenso haften wir unbeschränkt bei vorsätzlicher oder fahrlässiger Verletzung des Lebens, des Körpers oder der Gesundheit. Für leicht fahrlässig verursachte Sach- und Vermögensschäden haften wir nur im Falle der Verletzung solcher Pflichten, deren Erfüllung die ordnungsgemäße Durchführung des Vertrags überhaupt erst ermöglicht und auf deren Erfüllung der Käufer in besonderem Maße vertrauen darf („wesentliche Vertragspflichten), jedoch begrenzt auf den bei Vertragsschluss voraussehbaren, vertragstypischen Schaden.
7.        Ansprüche auf Ersatz von Schäden aller Art, die infolge unsachgemäßer Behandlung, Veränderung, Montage und/oder Bedienung der Liefergegenstände oder durch fehlerhafte Beratung oder Einweisung durch den Käufer entstehen, sind ausgeschlossen, es sei denn, wir haben sie zu vertreten. Zudem trägt der Käufer die volle Verantwortung für die Verwendung eines auf seinen Wunsch auf der Ware erscheinenden Designs, Warenzeichens oder Handelsnamens.
8.        Ist der Käufer berechtigt, Schadensersatz statt der Leistung zu verlangen oder vom Vertrag zurückzutreten, so muss er sich auf unser Verlangen binnen angemessener Frist erklären, ob und wie er von diesen Rechten Gebrauch machen wird. Erklärt er sich nicht fristgerecht oder besteht er auf der Leistung, ist er zur Ausübung dieser Rechte erst nach fruchtlosem Ablauf einer weiteren angemessenen Nachfrist berechtigt.
9.        Ansprüche wegen Mängeln verjähren in 12 Monaten ab Gefahrübergang. Für Rechtsmängel gilt Entsprechendes. Bei vorsätzlichen Pflichtverletzungen, bei Ansprüchen aus unerlaubter Handlung, beim Fehlen garantierter Eigenschaften, bei Übernahme von Beschaffungsrisiken sowie bei Verletzung von Personen gelten die gesetzlichen Verjährungsfristen. Ist die Leistung für ein Bauwerk bestimmt und hat sie dessen Mangelhaftigkeit verursacht, beträgt die Verjährungsfrist für Mängelansprüche 5 Jahre. §§ 438 Abs. 3, 479 und 634 a Abs. 3 BGB bleiben unberührt.

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10.      Falls dem Käufer wegen einer von uns zu vertretenden Verzögerung ein Schaden entsteht, kann er für jede volle Woche der Verzögerung 0,5%, insgesamt aber höchstens 5% vom Rechnungspreis desjenigen Teils der Leistung verlangen, der infolge der Verspätung nicht rechtzeitig oder nicht vertragsgemäß benutzt werden kann.
11.      Eine weitergehende Haftung auf Schadensersatz als in den vorstehenden Absätzen dieser Ziffer V. vorgesehen, ist - ohne Rücksicht auf die Rechtsnatur des geltend gemachten Anspruchs - ausgeschlossen.
12.      Die vorstehenden Haftungsbeschränkungen gelten nach Grund und Höhe auch zugunsten unserer gesetzlichen Vertreter, Mitarbeiter und sonstigen Erfüllungs- und/oder Verrichtungsgehilfen.
VI.     Eigentumsvorbehalt
1. Wir behalten uns das Eigentum an allen gelieferten Waren vor, bis der Käufer sämtliche derzeitigen und künftigen Verpflichtungen aus der Geschäftsverbindung mit uns vollständig erfüllt hat. Dies gilt auch dann, wenn Zahlungen auf besonders bezeichnete Forderungen geleistet werden. Bei laufender Rechnung gilt die Vorbehaltsware als Sicherheit für die Saldoforderung.
2. Be- und Verarbeitung der Vorbehaltsware erfolgen für uns als Hersteller im Sinne des § 950 BGB, ohne uns zu verpflichten. Die be-/verarbeitete Ware gilt als Vorbehaltsware im Sinne dieser Bedingungen. Wird die Vorbehaltsware mit anderen, uns nicht gehörenden Gegenständen verarbeitet oder untrennbar vermengt/verbunden, so erwerben wir das Miteigentum an der neuen Sache im Verhältnis des Rechnungswertes der Vorbehaltsware zum Rechnungswert der anderen verwendeten Gegenstände zum Zeitpunkt der Verarbeitung oder Vermengung/Verbindung. Wird die Vorbehaltsware mit anderen, uns nicht gehörenden Gegenständen zu einer einheitlichen Sache verbunden oder untrennbar vermengt und ist diese Sache als Hauptsache anzusehen, so überträgt uns der Käufer hiermit anteilmäßig Miteigentum, soweit die Hauptsache ihm gehört. Der Käufer verwahrt das so entstandene Eigentum unentgeltlich für uns mit.
3. Der Käufer ist bis zu unserem Widerruf, der jederzeit und ohne besondere Begründung zulässig ist, berechtigt, die Vorbehaltsware im ordentlichen Geschäftsgang weiterzuveräußern, weiterzuverarbeiten oder umzubilden. Als Weiterveräußerung in diesem Sinne gilt auch der Einbau in Grund und Boden oder in mit Gebäuden verbundene Anlagen oder die Verwendung zur Erfüllung sonstiger Verträge.
Der Käufer tritt uns für den Fall der Weiterveräußerung bereits hiermit seine aus einer solchen Veräußerung entstehende Kaufpreisforderung gegen den Kunden ab. Wird die Vorbehaltsware vom Käufer zusammen mit anderen, nicht von uns gelieferten Sachen veräußert, so gilt die Abtretung nur in Höhe der in unserer Rechnung genannten Werte der jeweils veräußerten Vorbehaltsware. Bei der Weiterveräußerung von Gegenständen, an denen wir gemäß Ziffer VI.2. Miteigentumsanteile haben, gilt die Abtretung in Höhe dieser Miteigentumsanteile. Die abgetretenen Forderungen dienen in demselben Umfang zur Sicherheit wie die Vorbehaltsware.
Wird die abgetretene Forderung in eine laufende Rechnung aufgenommen, so tritt der Käufer bereits jetzt einen der Höhe nach dieser Forderung entsprechenden Saldo aus dem Kontokorrent an uns ab.
Der Käufer ist bis zu unserem Widerruf, der jederzeit und ohne besondere Begründung zulässig ist, berechtigt, die uns abgetretene Forderung einzuziehen. Er ist auf unser Verlangen verpflichtet, seinen Kunden die Vorausabtretung an uns anzuzeigen und uns die zur Geltendmachung der Forderung erforderlichen Auskünfte und Unterlagen zur Verfügung zu stellen.
4. Übersteigt der Wert der für uns bestehenden Sicherheiten unsere Forderungen insgesamt um mehr als 10%, geben wir auf Verlangen des Käufers entsprechende Sicherheiten nach unserer Wahl frei.
5. Zu anderen Verfügungen über die Vorbehaltsware (Verpfändungen, Sicherungsübereignungen) oder anderen Abtretungen der in Ziffer VI.3. genannten Forderungen ist der Käufer nicht berechtigt. Im Falle von Pfändungen oder Beschlagnahmen der Vorbehaltsware hat der Käufer auf unser Eigentum hinzuweisen und uns unverzüglich zu informieren.
6. Der Käufer ist verpflichtet, die Vorbehaltsware gegen alle üblichen Risiken, insbesondere gegen Feuer, Einbruchs- und Wassergefahren auf eigene Kosten angemessen zu versichern, sie pfleglich zu behandeln und sie ordnungsgemäß zu lagern.
7. Ist der Käufer mit der Zahlung von mindestens zwei Kaufpreisraten ganz oder teilweise in Zahlungsverzug, sind wir nach erfolglosem Ablauf einer von uns gesetzten Nachfrist auch dann zur Rücknahme der Vorbehaltsware berechtigt, wenn wir nicht vom Vertrag zurückgetreten sind.
VII.    Leistung durch verbundene Unternehmen
Auf unser Verlangen kann jede unserer vertraglichen Verpflichtungen durch ein anderes Unternehmen des Konzerns Trinseo S.A. (Luxemburg) erfüllt werden. Die berechtigten Interessen des Käufers sind dabei angemessen zu berücksichtigen. Solange die Leistung gleichwertig ist, gelten die betreffenden vertraglichen Verpflichtungen als erfüllt.
VIII.  Beachtung von Sicherheits- und sonstigen Vorschriften
1. Soweit im Einzelfall nicht abweichend vereinbart, ist der Käufer für die Beachtung gesetzlicher und behördlicher Vorschriften sowie anerkannter Praktiken bezüglich Einfuhr, Transport, Lagerung, Handhabung, Verwendung und Entsorgung der Ware verantwortlich.
2. Der Käufer ist zudem verpflichtet,
 sich mit allen von uns gestellten Produktinformationen einschließlich Material Safety Data Sheet (MSDS) vertraut zu machen,
 seinen Mitarbeitern, Auftragnehmern, Agenturen und Kunden ausreichende Anweisungen zum Umgang mit den Produkten zu erteilen,
 geeignete Maßnahmen zur Verhütung von schädlichen Umwelteinwirkungen und anderen Gefahren für Personen oder Vermögenswerte durch unsere Ware zu treffen.
3. Verletzt der Käufer die in Ziffer VIII.1. und 2. genannten Pflichten nicht unerheblich, sind wir berechtigt, nach vorheriger Abmahnung vom Vertrag zurückzutreten.

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4. Der Käufer haftet gegenüber uns für alle Schäden, die infolge der Missachtung der Sicherheitsvorschriften durch ihn entstehen und stellt uns von entsprechenden Inanspruchnahmen Dritter frei.
IX.     Übertragung von Rechten, Markenbenutzung
1. Die Übertragung der Rechte des Käufers aus der Vertragsbeziehung ist nur mit unserer vorherigen, schriftlichen Zustimmung zulässig.
2. Der Käufer darf die für uns geschützten Marken in seiner Werbung nur mit unserem zuvor erteilten Einverständnis, nach unseren Vorgaben, in der Originalgestaltung und nur für unveränderte Originalwaren nutzen. Unser Einverständnis kann jederzeit widerrufen werden. Für die Ausgestaltung seiner Werbung trägt der Käufer die alleinige Verantwortung.
X.      Vertraulichkeit, Vertragsstrafe, Datenschutz
1 . Der Käufer hat die ihm im Rahmen der Vertragsbeziehung offenbarten Geschäfts- und Betriebsgeheimnisse, insbesondere die mit ihm vereinbarten Preise, streng vertraulich zu behandeln. Er wird sie Dritten nur nach unserer vorherigen schriftlichen Zustimmung mitteilen. Der Käufer hat seine Mitarbeiter auf diese Vertraulichkeitsverpflichtung hinzuweisen. Für jeden Fall einer Verletzung dieser Ziffer X. hat der Käufer eine Vertragsstrafe in Höhe von € 10.000,-- zu zahlen.
2. Wir sind berechtigt, die im Zusammenhang mit der Geschäftsbeziehung erhaltenen Daten unter Beachtung der gesetzlichen Vorgaben zu verarbeiten, zu speichern oder zu übermitteln, soweit dies für den Vertragszweck oder zur Wahrung unserer berechtigten Interessen erforderlich ist und kein Grund zur Annahme besteht, dass ein überwiegendes, schutzwürdiges Interesse des Käufers dies verbietet.
3 . In diesem Zusammenhang können wir Ihre persönlichen Daten innerhalb unserer weltweit tätigen Unternehmensgruppe sowohl an mit uns verbundenen Unternehmen als auch an im In- und Ausland ansässige Dritte, die für uns Dienstleistungen erbringen, übermitteln. In einigen Ländern gelten möglicherweise weniger strenge Datenschutzbestimmungen für Ihre persönlichen Daten. Wir treffen mit Dritten entsprechende vertragliche Vereinbarungen, die diese verpflichten, die datenschutzrechtlichen Erfordernisse zu beachten, soweit dies geboten ist.
XI.     Rechtswahl, Gerichtsstand
1. Es gilt ausnahmslos das für die Rechtsbeziehungen inländischer Vertragspartner maßgebliche Recht der Bundesrepublik Deutschland; die Anwendung des UN-Kaufrechtsübereinkommens vom 11.4.1980 wird ausgeschlossen.
2. Für alle sich aus dem Vertragsverhältnis ergebenden Streitigkeiten ist, wenn der Käufer Kaufmann, eine juristische Person des öffentlichen Rechts oder ein öffentlich-rechtliches Sondervermögen ist oder im Inland keinen allgemeinen Gerichtsstand hat, als Gerichtsstand Frankfurt am Main vereinbart. Wir sind aber berechtigt, den Käufer auch an seinem allgemeinen Gerichtsstand zu verklagen.

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PART C
DUTCH DOCUMENTATION

145

 

ORDER ACKNOWLEDGEMENT

Styron Netherlands B.V.
HERBERT H.Dowweg 5
P.O. BOX 48
4530 AA TERNEUZEN
THE NETHERLANDS	 	Styron order number / No. de
commande Styron / Styron
[ILLEGIBLE]	Order Date	
	 	 	 	
	 	03027570	05 NOV 2012	

 	 	 	
Customer order number / Votre Référence/Best[ILLEGIBLE]	 	Styron Order entry contact / Votre [ILLEGIBLE] Styron / Styron [ILLEGIBLE]	
4500200878	 	MARION VON GILSA / +49–6196–9693131	
 
Sold To / [ILLEGIBLE] / [ILLEGIBLE]	 	Ship to / Adresse [ILLEGIBLE] / [ILLEGIBLE]	
ICL-IP TERNEUZEN BV	 	ICL-IP TERNEUZEN BV	
FRANKRIJKUEG 6	 	FRANKRIJKWEG 6	
4538  BJ   TERNEUZEN	 	4538  BJ   TERNEUZEN	

Delivery terms / Conditions [ILLEGIBLE] / [ILLEGIBLE]	 	Means of transport / Moyen de transport / Transportmitted	
DDP / TERNEUZEN	 	SILOTRUCK	
 
Payment terms / Conditions deréglement / [ILLEGIBLE]	 	Currency / [ILLEGIBLE] / [ILLEGIBLE]	
10 DAYS AFTER DATE OF INVOICE LESS 2.0% – DIRECT DEBIT	 	EURO	

Item
Pos.	Quantity & description / Quantité &
[ILLEGIBLE] / [ILLEGIBLE] & [ILLEGIBLE]	Gross & Net [ILLEGIBLE] /
[ILLEGIBLE] [ILLEGIBLE] & net
/ Brutto & Netto- Menge	Price per unit / [ILLEGIBLE] /
[ILLEGIBLE] per [ILLEGIBLE]	Delivery date / Date
[ILLEGIBLE] / [ILLEGIBLE]	
01	1.922 KILOS	1.922 KG	 	31  OKI  2012	
 	x  0,001  TONNEN	1,922 MT	
1.907,29	 	
 	Acrylonitrile - ST	 	EUR/MT	 	
 
WE THANK YOU FOR THIS ORDER WHICH IS ACCEPTED SUBJECT TO OUR GENERAL TERMS AND CONDITIONS.
 
NOUS VOUS REMERCIONS DE VOTRE COMMANDE QUE NOUS ACCEPTONS SELON NOS CONDITIONS GENERALES DE VENTE.
 
WIR DANKEN IHNEN FUER IHREN AUFTRAG, DEN WIR GEMAESS UNSEREN ALLGEMEINEN GESCHAEFTSBEDINGUNGEN ENTGEGENNEHMEN.

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GENERAL TERMS AND CONDITIONS
1.    Interpretation of Trade Terms
Trade terms shall be interpreted in accordance with Incoterms 2000. Title shall pass to Buyer at the same time as the risks of loss or damage under Incoterms 2000. If this Sales Contract does not specify trade terms as defined in Incoterms 2000 , title and risk of loss shall pass to Buyer upon delivery into the custody of the carrier.
2.    Seller's Commitments
2.1.   Seller undertakes that the Product will at the time of delivery meet Seller's then current Sales Specifications. Seller will notify Buyer if Sales Specifications are changed. All descriptions, drawings, photographs, illustrations, performance and technical data, dimensions, weights and the like, contained in any promotional or technical literature issued by Seller are subject to variation without notice and are not designed to constitute Sales Specifications.
2.2.   Seller will supply Buyer with current Material Safety Data Sheets (MSDS) regarding the Product.
2.3.   Seller will convey the Product with good title, free from any lawful lien or encumbrance.
3.    Responsible Practices
3.1.   Buyer will (i) familiarise itself with any product literature or information Seller provides under Seller’s product stewardship program, including MSDS, (ii) follow safe handling, use, selling, storage, transportation and disposal practices, including special practices as Buyer’s use of the Product requires and instruct its employees, contractors, agents and customers in these practices and (iii) take appropriate action to avoid spills or other dangers to persons, property or the environment. Seller may cancel this Contract on 15 days notice if Buyer fails to comply with any of its commitments under this subsection.
3.2.   Notwithstanding the provisions of Section 5 hereof, Buyer will indemnify Seller for all claims, damages and related costs, including reasonable attorney fees, arising out of Buyer's non-compliance with any of its commitments under Section 3.1 above.
4.    Patents/Trademarks
Seller warrants only that the manufacture of the Product covered by this Contract does not infringe any Letters Patent of the country of manufacture. Buyer assumes all responsibility for use of any design, trademark, trade name, or part thereof, appearing on the Product at Buyer's request.
5.    Warranty/Liability
5.1.   The commitments set out in Sections 2 and 4 above are Seller's sole warranties in respect of the Product. ANY OTHER CONDITION OR WARRANTY AS TO THE QUALITY OF THE PRODUCT SUPPLIED UNDER THIS CONTRACT OR FITNESS FOR ANY PARTICULAR PURPOSE WHETHER ARISING UNDER STATUTE OR OTHERWISE, IS EXCLUDED.
5.2.   Buyer shall inspect the Product supplied under this Contract immediately after delivery. If any of the supplied Product is rejected because of non-conformity to specifications, Buyer shall have the right to return it to Seller only after inspection by Seller and receipt of definite shipping instructions from Seller, such inspection to be made and instructions to be given by Seller within thirty (30) days after notice of rejection by Buyer. Either (1) failure to give written notice of any claim within thirty (30) days from the date of delivery, or (2) use of the Product supplied under this Contract, constitutes an unqualified acceptance of such Product by Buyer and a waiver by Buyer of all claims in respect of such Product.
5.3.   In the event of any liability by either party whether arising from breach of contract or from statutes it is agreed that the maximum amount of damages recoverable shall be limited to the contract price for the Product with respect to which damages are claimed. In no event shall either Seller or Buyer be liable for indirect, consequential, special, punitive or exemplary damages in connection with or arising out of this Contract.
6.    Price and Terms
6.1.   Seller may change the previously agreed price, terms and conditions of payment or of transportation, or the minimum requirement per shipment at any time, by fifteen (15) days prior written notice to Buyer. Buyer's failure to make written objection to the change prior to the effective date shall be considered acceptance. If Buyer objects within the fifteen (15) day period, Seller shall have the option (a) to continue to supply on the terms and conditions in effect prior to the announced change, or (b) to cancel the affected Product quantities immediately and shall advise Buyer accordingly within fifteen (15) days from receipt of Buyer's written objection.
6.2.   Seller reserves the right by written notice given at any time before shipment, to increase the price under this Contract, if there is any increase in the price or cost of the Product to Seller by virtue of foreign exchange fluctuations, currency regulations, changes in duties or taxes, increase in the cost of raw materials, labor or transport or any other causes beyond the control of Seller. If Buyer is of the opinion that any such increase in price is unreasonable, it may object to such increase by written notice given within fifteen (15) days of the date of receipt of Seller's notice; Seller shall then have the option to continue to supply Buyer at the price currently in effect, if willing to do so or to cancel the Contract immediately upon notice to Buyer in writing.
7.    Schedule of Deliveries
Buyer shall schedule deliveries of the Product uniformly throughout the calendar year. Not more than ten percent (10%) of the annual quantity of the Product shall be scheduled for delivery in any calendar month, except with Seller's prior written consent.
8.    Transportation
Where the price provides for absorption by Seller of any portion of the freight charges, or where Seller provides the transportation equipment at its cost, Seller shall have the right to select the means of transportation. Where the price provides for payment by Buyer of any portion of the freight charges, the freight charges will be those in effect at the date of shipment.
9.    Delivery Equipment
During the time that Seller's delivery equipment is in the possession of Buyer, Buyer shall be liable to Seller for damages or destruction of such equipment attributable to Buyer. All repairs to equipment shall be made under the supervision or direction of Seller.

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10.    Force Majeure
In the event of accident, mechanical breakdown of facilities, fire, flood, strike, labor trouble, riot, revolt, war, acts of governmental authority, acts of God, or contingencies beyond the reasonable control of the party affected, interfering with the performance of this Contract, the quantity of Product provided for in this Contract shall be reduced by the amount so affected without liability, but the Contract shall otherwise remain unchanged. The decision of the party affected as to the quantities of Product affected shall be final and binding.
11.    Governmental Controls
If the price, freight allowance, or terms of payment, or any price increase, or change in freight allowance, or terms of payment under this Contract, or Seller's ability to make any such increase or change, should be altered or prohibited by reason of any law, government decree, order or regulation, Seller may cancel this Contract upon fifteen (15) days written notice. However, at its option, Seller may by written notice elect to postpone the effective date of any price increase or proposed change to the extent so prevented until such date or dates as it is not so prevented. By electing to postpone rather than cancel, Seller will not waive its right to cancel thereafter because of such continued or further alterations or prohibitions.
12.    Non-performance
12.1.   If Buyer fails to perform any of the terms of this Contract when due, Seller may, at its option, decline to make further deliveries against this Contract, except for cash, or may recall or defer shipments until such default is made good, or may treat such default as final refusal to accept further shipments and cancel this Contract.
12.2.   Seller reserves the right, without prejudice to Buyer's liability to pay on the due date, to charge interest on any overdue balance of a rate equal to the one month EURIBOR interest for the currency invoiced, as fixed on the last business day of the month preceding the date of payment, plus five percent (5%) points. Such right is in addition and without prejudice to any other rights Seller may have under this Contract.
13.    Performance by Affiliates
At Seller's option, any Sales Contract obligation may be performed by Styron Holding B.V. or any of its affiliates.  Any deliveries made under this condition may be invoiced by such affiliate and shall constitute performance of this Contract by Seller.
14.    Non-transferable
This Contract is neither transferable nor assignable by Buyer without Seller's prior written consent.
15.    Non-waiver
Failure to exercise any rights under this Contract upon any occasion shall not waive the right to exercise the same on another occasion.
16.    Severability of Provisions
Should any provision of this Contract be held invalid or unenforceable, the validity and enforceability of the remaining provisions shall not be affected. Any invalid or unenforceable provision shall be replaced with a new provision which will allow the parties to this Contract to achieve the intended economic result in a legally valid and effective manner.
17.    Applicable Law and Jurisdiction
This Contract shall be governed by and construed in accordance with the laws of the Netherlands. Any disputes arising out of this Contract shall be submitted to the competent courts of Rotterdam, the Netherlands. The United Nations Convention on Contracts for the International Sale of Goods (1980) shall not apply to this Contract.
18.    Controlling Terms & Amendments
By ordering any of the Product detailed in this Contract, Buyer agrees to all the terms and conditions contained on both sides of this document which override any additional or different terms or conditions included in Buyer's purchase order or referred to by Buyer. Seller explicitly rejects Buyer's terms and conditions. Any amendments or additions to this Sales Contract shall be valid only if in writing and signed by both parties.

148

PART D
U.S. DOCUMENTATION

149

CONDITIONS OF SALE
CONTRACT DEFINED : The following Conditions of Sale apply to the sale of Products by Styron LLC or its affiliate (“ Styron ”) to Customer except to the extent superseded by an applicable written contract executed by Styron. Any terms and conditions stated by Customer in any purchase order or document related to the Product that are in conflict with, different from, or in addition to, these Conditions shall not be binding unless separately and expressly accepted in writing by Styron. Except as otherwise expressly agreed in writing by Styron, upon Styron's acceptance by Styron of the quantity of Product specified on Customer's purchase order, such quantity, together with these Conditions and all other provisions of any applicable Styron document(s) on or to which these Conditions are printed or attached, will constitute the Contract between Styron and Customer. Except as otherwise expressly agreed in writing by Styron, Styron's acceptance of Customer's purchase order is expressly conditioned on Customer’s acceptance of these Conditions.
STYRON'S COMMITMENTS TO CUSTOMER : (a) The Product when shipped will meet Styron's then current Product sales specifications (“ Specifications ”) ;   (b)   Styron will convey the Product with good title, free from any lawful lien or encumbrance; and (c) Product delivered, and title and risk of loss pass, to Customer F.O.B. Styron's Shipping Facility, except Styron pays freight and selects carrier. Styron will notify Customer if the Specifications are changed after receipt of a purchase order. Styron will supply Customer with current material safety data sheets (“ MSDS ”). Styron reserves the right to change the Specifications or properties of any Product at any time on at least thirty (30) days notice. If the change is not acceptable, Customer may terminate the Contract with respect to the changed Product by giving written notice to Styron. Styron also warrants that it will comply with all applicable laws and governmental rules, regulations and orders. STYRON MAKES NO OTHER WARRANTIES REGARDING THE PRODUCT, WHETHER OF FITNESS FOR A PARTICULAR PURPOSE, MERCHANT ABILITY, OR OTHERWISE, AND NONE WILL BE IMPLIED.
CUSTOMER'S COMMITMENTS TO STYRON : Customer will pay for the Product on the agreed payment terms. Customer agrees to notify Styron, in writing, within ten (10) days after receipt of any of Customer’s invoices, if it disputes any such invoice, in whole or in part, and to specify the nature of the dispute. If (a) Customer does not pay on time or (b) Customer's financial responsibility becomes unsatisfactory and Styron deems itself insecure, then Styron may defer shipments, accelerate the due date on amounts owed Styron, require cash payments or other security, call any existing letter of credit held by Styron, and/or terminate this Contract without liability and without waiving any other remedies Styron may have against Customer. Customer agrees to pay all of Styron's collection costs including reasonable legal fees and costs. Styron may charge Customer the maximum interest allowed by law on all overdue amounts. Customer will be solely responsible for determining the suitability of Product in Customer’s formulations and applications prior to use. Customer shall promptly, and in any event prior to use and/or commingling, inspect Product shipments for any damage to packaging, shortage or non-conformance to this Contract.
INDEMNIFICATION :   Customer will indemnify Styron against any liability (whether strict or otherwise) for any claim, loss or expense (including reasonable attorney's fees) on account of any injury, disease or death of persons (including Customer's employees) or damage to property (including Customer’s) arising out of Customer's unloading, storage, handling, sale or use of the Product (except to the extent caused by Styron's gross negligence); any failure by Customer to disseminate safety and health information as required hereby, and/or Customer's failure to comply with the export compliance obligations set forth herein. Styron shall have no liability for any claim arising out of or in connection with this Contract unless Customer gives Styron notice of the claim, setting forth fully the facts on which it is based, by the earlier of (a) thirty (30) days after the date such facts were discovered or reasonably should have been discovered, or (b) ninety (90) days after receipt of the Product. Styron's liability for defective or nonconforming Product, whether or not based on negligence, will not exceed the purchase price of the Product involved in the claim and NEITHER PARTY WILL BE LIABLE FOR ANY SPECIAL, INCIDENTAL, CONSE QUENTIAL OR PUNITIVE DAMAGES . The foregoing provisions will survive termination of this Contract.
CHANGES TO TERMS : Styron may increase Price, change transportation or payment terms, and/or change the notice provision, by giving Customer at least fifteen (15) days prior notice. A Temporary Voluntary Allowance (“ TVA ”) from the current Price of any Product may be instituted, changed, or withdrawn by Styron at any time, with or without notice, and shall not be deemed a change of Price.
FORCE MAJEURE : Performance is excused when (a) there is any contingency beyond the reasonable control of Styron or Customer (including, for example, war or hostilities, acts of God, accident, fire, explosion, public protest, breakage of equipment, pandemic, acts of terrorism, activity of a governmental authority (including, for example, the passage of legislation or the failure to grant an export license), or labor difficulties) which interferes with Styron's or Customer's production, supply, transportation or consumption practice; or (b) Styron is unable to obtain raw materials, power or energy on terms Styron deems commercially acceptable. During times when performance is excused, all quantities of affected Product will be eliminated from this Contract without liability and Styron will allocate its supplies of raw materials and Product among their various uses in any manner that Styron determines is fair and reasonable, but this Contract will otherwise remain in effect. Styron will not be obligated to obtain raw materials, intermediates, or Product from other sources, or to allocate raw materials, intermediates, or Product from Styron's internal use. The foregoing provisions shall in no event relieve Customer of its obligation to timely pay in-full a Product invoice.
ASSIGNMENT : This Contract is not transferable or assignable by either party without prior written consent of the non-assigning party, however, Styron shall have the right to assign this Contract to a wholly-owned subsidiary of Styron, or to a purchaser or other successor to a significant portion of Styron's assets involved in the manufacture of the Product, without the consent of Customer. Additionally, any corporate restructuring which has the primary purpose of changing the name of Styron shall not be deemed an assignment and shall be freely permitted.
GENERAL : Customer warrants that (a) it understands and shall comply with the requirements of the U.S. Foreign Corrupt Practices Act and all other applicable anti-bribery and anti-corruption laws of the jurisdictions under which Customer is or may be acting hereunder, and (b) it will comply with all U.S. laws, regulations, rules and orders regarding export control. This Contract shall be governed and construed in accordance with the internal laws of Delaware. The United Nations Convention on Contracts for the international Sale of Goods (1980) shall not apply to this Contract. Exclusive venue for all disputes arising out of or in connection with this Contract shall be in any State or Federal court in Delaware.

 

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SCHEDULE 12
APPROVED NON-STANDARD DOCUMENTATION OBLIGORS
Subject in each case to review and approval in writing by the Cash Manager of the relevant non-standard contracts:
1

1   Only in relation to the Styrene Monomer sales contract.

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SCHEDULE 13
ACCOUNT DETAILS
Account No :
IBAN no :
Currency : USD
Type of Account: Current
Account No :
IBAN no :
Currency : EUR
Type of Account: Current

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SCHEDULE 14
FORM OF BANK MANDATE
Deposit Accounts
Styron Receivables Funding Designated Activity Company
THIS BANK MANDATE is made             [●] 2017
BY:
(1)        TRINSEO EUROPE GMBH (formerly STYRON EUROPE GMBH), a limited liability company incorporated in Switzerland, having its registered office at Zugerstrasse 231, CH-8810 Horgen, Switzerland, (the “ Current   Swiss Servicer “);
(2)        TRINSEO EXPORT GMBH , a limited liability company incorporated in Switzerland, having its registered office at Zugerstrasse 231, CH-8810 Horgen,  Switzerland (the “ Acceding Swiss Servicer ”);
(3)        TRINSEO DEUTSCHLAND ANLAGENGESELLSCHAFT MBH (formerly STYRON DEUTSCHLAND ANLAGENGESELLSCHAFT MBH), incorporated in Germany as a limited liability company (Gesellschaft mit beschränkter Haftung), registered at the “local court (Amtsgericht) of Tostedt under HRB 202609 and having its business address at Kölner Straße 10, 65760 Eschborn, Germany (the “ German Servicer ”); 
(4)        TRINSEO NETHERLANDS B.V. (formerly STYRON NETHERLANDS B.V.), a limited liability company incorporated in The Netherlands, having its registered office at Innovatieweg 14, 4542 NH Hoek (Terneuzen), The Netherlands (the “ Dutch Servicer ”);
(5)        TRINSEO LLC (formerly STYRON LLC ), a Delaware limited liability company, having an office at 1000 Chesterbrook Boulevard, Suite 300, Berwyn, Pennsylvania 19312 (the “ U.S. Servicer ” and together with the Current Swiss Servicer, the Acceding Swiss Servicer, the German Servicer and the Dutch Servicer, the “ Servicers ”);
(6)        STYRON RECEIVABLES FUNDING DESIGNATED ACTIVITY COMPANY a company incorporated in Ireland with registration number 486138, where registered office is at 3rd Floor, Kilmore House, Park Lane, Spencer Dock, Dublin 1, Ireland (the “ Company ”); and
(7)        HSBC BANK PLC (the “ Bank ”).
TO:     The Bank
1.        The Company has opened the following deposit accounts in its name at the Bank:
(a)       a Euro deposit account entitled “Styron Receivables Funding Limited re Styron Europe GbmH Euro a/c”
Account No :
IBAN no :

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Currency : EUR
Type of Account: Current
(b)       a Dollar deposit account entitled “Styron Receivables Funding Limited re Styron Europe GmbH Dollar a/c”
Account No :
IBAN no :
Currency : USD
Type of Account: Current
(each as from time to time renewed, redesignated or renumbered, a “ Deposit Account ”).
2.        The Bank agrees that it will operate the Deposit Accounts in accordance with this Mandate and each of the parties hereto acknowledges that this Mandate is given on the basis that the Bank complies with the procedures set out herein and that this Mandate replaces any previous Mandate signed or instructions given by the Company in relation to the Deposit Accounts.
3.        The Company has:
(a)       appointed the Servicers to make deposits from time to time on behalf of the Company with the Bank; and
(b)       granted the Servicers authority to agree to rates and maturities on the Deposit Accounts with the Bank and to instruct the Bank to make repayments in accordance with Clause 5,
until further notice to the contrary from the Company.
4.        The funds paid to the Bank to be deposited in the Deposit Account will be made from the accounts as set out in Schedule 2 hereto, which shall include any accounts from time to time redesignated or renumbered (the “ Collection Accounts ”).
5.        The Company hereby instructs the Bank to repay any maturing deposits to the Collection Account denominated in the relevant currency until further instructions are received from the Company to the contrary. The Servicers are not authorised to amend any instructions under the terms of this Mandate without the agreement of the Company.
6.        The Company, the Servicers and the Bank acknowledge that the Bank has been provided with the names and signatures of those agents of the Servicers as set out in Part B of Schedule 1 (“ B List Signatories ”) and those agents of the Company as set out in Part A of Schedule 1 (“ A List Signatories ”) who have been authorised by the Company to execute and send notices, statements and directions (“ Notices ”) in connection with this Mandate on the Company’s behalf (each an “ Authorised Signatory ”).
7.        The Authorised Signatories may be changed at any time, and from time to time, by delivery to the Bank of a replacement schedule signed by any two outgoing or continuing A List Signatories.

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8.         Reliance by the Bank upon a Notice apparently or purportedly signed by the Authorised Signatories in accordance with the terms of this Mandate shall operate as a discharge of the Bank in relation to any notice relied and duly acted upon by it.
9.         If any notice or instruction received by the Bank under, and in accordance with, this Mandate is in the Bank’s view unclear or ambiguous, the Bank may in its absolute discretion and without any liability on its part either (i) act upon what it believes in good faith to be the intent of such notice or instruction, or (ii) delay acting on such notice or instruction pending clarification of the unclear or ambiguous element thereof.
10.       The Bank waives all rights of set-off, lien (including pledge rights and any other security rights), combination, consolidation, merger or counterclaim it may have or hereafter acquire in respect of monies held in the Deposit Accounts.
11.       In the performance of this Mandate the Bank may rely on a notice or communication appearing or purporting to be given under and in accordance with this Mandate and believed by the Bank in good faith to be genuine and the Bank shall have no obligation to make enquiries as to the justification, validity or contents of any notices delivered to it pursuant to this Mandate.
12.      The persons issuing this Mandate agree not to take any action or proceedings against the Bank in connection with any dispute arising out of the operation of this Mandate provided that the Bank shall have exercised reasonable skill and care in performing the Mandate.
13.      The Bank agrees that it shall not take any corporate action or other legal steps or legal proceedings for the bankruptcy, winding-up, dissolution, re-organisation, examinership, appointment of a receiver, administrator, administrative receiver, examiner, liquidator, sequestrator or other similar officer of the Company or of any or all of the Company’s assets or participate in any proceedings nor seek any judgment against the Company for the purposes of enforcing payment of any amounts payable to it by the Company under this Mandate for the purpose of recovering any debts whatsoever owing to it by the Company.
14.       The terms of this Mandate may be amended or revoked only by an instrument in writing signed by an A List Signatory and the Bank.
15.      The Company undertakes upon the request of the Bank to execute such further documentation for the purposes of this Mandate as the Bank may reasonably require.
16.      The Bank shall supply confirmations to the Servicers and the Company relating to the Deposit Accounts, either by facsimile, or by any other method agreed between the Bank, the Company and the Servicers.
17.       Any notices, including written directions to the Bank to be given pursuant to this Mandate, shall be sufficiently served if sent by pre-paid post or facsimile transmission and shall be deemed to be given (in the case of any notice by facsimile transmission) when dispatched and (in the case of any notice by post) when received, and shall be sent:

155

(a)        in the case of the Bank, to the address of its office as set out above, for the attention of [      ] (facsimile number[        ]);
(b)       in the case of the Company, to the address of its office as set out above (facsimile number [      ]) with a copy to [      ] at HSBC Bank plc, 8 Canada Square, London, E14 5HQ (facsimile number [      ]);
(c)       in the case of the Current Swiss Servicer and the Acceding Swiss Servicer, to the address of its office as set out above, for the attention of [      ] (facsimile number         [       ]);
(d)       in the case of the German Servicer, to the address of its office as set out above, for the attention of [      ] (facsimile number [       ]);
(e)       in the case of the Dutch Servicer, to the address of its office as set out above, for the attention of [       ] (facsimile number [       ]); and
(f)        in the case of the U.S. Servicer, to the address of its office as set out above, for the attention of [      ] (facsimile number [      ]).
18.      This Mandate may be executed in any number of counterparts and by different parties on separate counterparts and all such counterparts together shall constitute one and the same instrument; a set of counterparts which together contain signatures of all the parties hereto shall be lodged with the Bank and the Master Purchaser.
19.      This Mandate shall be governed by and construed in accordance with the laws of England.

 	 	

Trinseo Europe GmbH	 	

 	 	
 	 	
Trinseo Export GmbH	 	

156

 	 	

 	 	
 	 	
Trinseo Deutschland Anlagengesellschaft MBH	 	

 	 	
 	 	
Trinseo Netherlands B.V.	 	

 	 	
 	 	
Trinseo LLC	 	

 	 	
 	 	
Styron Receivables Funding Designated Activity Company	 	

Agreed by:	 	

 	 	
HSBC Bank plc	 	

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SCHEDULE 1 FORM OF AUTHORISED PERSONS
AUTHORISED PERSONS

PART A	
 	Name	Specimen signature	
Company	 	 	

 	 	 	
PART B	
 	Name	Specimen signature	
Swiss Servicer (Trinseo Europe GmbH)	 	 	

 	 	 	
Swiss Servicer (Trinseo Export GmbH)	 	 	

Dutch Servicer	 	 	

 	 	 	
German Servicer	 	 	
 	
2	 	

2 Must sign jointly with

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US Servicer	 	 	

 

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SCHEDULE 2 COLLECTION ACCOUNTS

Servicer	USD Account	EUR Account	
Current Swiss Servicer	Account number:
 
Bank: Deutsche Bank AG, Frankfurt, Germany
 
IBAN:
SWIFT: DEUTDEFF	Account number:
 
Bank: Deutsche Bank AG, Frankfurt, Germany
 
IBAN:
SWIFT: DEUTDEFF	
Acceding Swiss Servicer	Account number:
 
Bank: Deutsche Bank AG, Frankfurt, Germany
 
IBAN:
SWIFT: DEUTDEFF	Account number:
 
Bank: Deutsche Bank AG, Frankfurt, Germany
 
IBAN:
SWIFT: DEUTDEFF	
German Servicer	N/A	Account number:
 
Bank: Deutsche Bank AG, Frankfurt, Germany
 
IBAN:
SWIFT: DEUTDEFF	
Dutch Servicer	N/A	Account number:
 
Bank: Deutsche Bank AG, Amsterdam, Netherlands
 
IBAN:
SWIFT: DEUTNL2A
 
Account number:
Bank: Deutsche Bank AG, Brussels, Belgium
 
IBAN:
SWIFT: DEUTBEBE	
US Servicer	Account number:
 
Bank: Deutsche Bank Trust Co, New York, USA
 
IBAN:
SWIFT: BKTRUS33
 
 	N/A	

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APPENDIX A
SELLER CREDIT AND COLLECTION PROCEDURES

161

TRINSEO
GLOBAL CREDIT POLICY
1.0  PURPOSE
The purpose of this policy is to define the requirements for establishing and maintaining credit lines and payment terms for Trinseo’s customers. This policy also provides a framework for:
o The regular screening and rating of the financial health of our customers
o The mitigation of customers risk by providing both a prior assessment of the counterparty we are selling to and the deployment of mitigation action plans for potentially defaulting customers in order to secure Trinseo Account Receivable asset.
o A common methodology across all the globe for all the Trinseo Businesses for determination of Credit Limits
o A common methodology across all the globe for the calculation of the bad debt reserve (BDR)
o Alternative payment requirements for accommodating sales to customers who do not qualify for credit with Trinseo.
2.0 SCOPE
This Policy applies to all customers of Trinseo across all businesses and all geographical areas. All organizations within Trinseo responsible for the sales, marketing, contract approval, order acceptance, scheduling and shipment of products must adhere to the policy and guidelines below.
3.0 POLICY
In order to facilitate the flow of orders and shipment of products, Trinseo policy provides a credit facility to all customers who demonstrate both the ability to pay and history of timely payments of debts. The credit department will evaluate all new customers to determine what payment terms and methods will be required and what level of credit will be established.
The credit department will also periodically review customer financial standing and re-evaluate credit limits and/or payment terms of existing customers, take into consideration customer requirements and manage risk as financial and business conditions change. In its day-to-day operations, the credit department will consistently adhere to all company policies regarding fair and equitable treatment in customer communications and relations.
3.1 Global Customer Credit Risk Assessment Process
The Global customer credit risk assessment process provides a standard approach to assessing the financial health of Customers and determining the maximum grantable credit limit. This section outlines the Process as well as the allocation of roles and responsibilities between the different functions and credit team. The detailed description of that process is outlined in the “Trinseo Global Credit Procedure” document (Annex 1)
The Credit assessment Template (CAT) is the standard tool for calculation of the maximum grantable credit limit for customers where needed credit limit is greater than 100,000 USD.

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If the required credit limit is 100,000 USD or below, the credit decision should be based on credit agency reports such as D&B, Coface, Creditreform or BVD (Amadeus, Orbis etc..) and/or other factors such as pay habits, long term relationship, references or others.
4.0 RESPONSIBILITY
The corporate credit team is responsible for managing the credit review and approval process and accounts receivable balance to minimize collection exposure in accordance with the overall corporate operational and financial objectives.
Credit Managers make decisions concerning credit limits, acceptable levels of risk and terms of payments. It is Credit Managers responsibility to:
o Determine credit ceilings.
o Set up credit-rating criteria.
o Set up and ensure compliance with a corporate credit policy.
o Set and enforce payment terms, including cash discounts
o Revoke credit limits and/or hold shipments, when political, economic and financial conditions are adverse, or when the credit risk is not acceptable
o Design, implement and enforce company internal control procedures regarding Accounts Receivable management
o Oversee the Payment Receipt and Handling process (PR&H) and lead collections when appropriate
o Consult with Business management to set and enforce appropriate order control procedures and business rules consistent with Business Strategies
o Negotiate repayment schedules as appropriate
o Provide on time and accurate management performance reporting
o Define, design and implement information systems to manage orders, accounts receivable and credit process effectively
o Establish Bad Debt Reserve and Accounts Receivable write-off procedures
Credit analysts assess and make decisions about customer credit applications using a range of criteria including purpose of application, credit viability, customer payment history, customer credit-worthiness etc. It is Credit Analyst responsibility to:
o Gather information;
o Read financial statements;
o Assess, analyze and interpret financial information;
o Evaluate / analyze risk versus reward to support Businesses
o Keeping company credit exposures within set risk limits;
o Undertake various operational tasks in order to support the Credit Managers
The credit department will authorize all communications with the customers and determine which financial information is required, and what level of credit limit will be approved.
4.1 Payment Receipt and Handling ("PR&H") Role
The role and responsibility of each function within the money collection and Accounts Receivable discrepancy resolution is described in the PR&H process.
Businesses have the responsibility for collecting the Accounts Receivable created by each sale, with Customer Financial Services overseeing the PR&H process and leading collections when appropriate.

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4.2 Business, Sales & Marketing Role
The sales department is responsible for ensuring that the credit application form is submitted to the credit department (When needed) for a prospective new customer, in advance of order acceptance and in accordance with the Customer Credit Application Procedure. The Field seller also is responsible for instructing the customer regarding the respective roles and requirements of the credit, order administration and sales departments for introducing the customer to the appropriate representative of these departments.
Business Management will provide support to Credit management team in any activity described in 4.0. Business Management is expected to assist in the development of customers specific credit strategies and to enforce the internal control practices referred to in this document.
5.0 GUIDELINES
5.1 Credit Limits and Payment Terms
A credit evaluation is performed by the Credit Department in order to recommend credit limit, payment terms, and any other conditions of sale specific to the customer. The proposal is communicated to the field seller and approved by the appropriate DOA levels holder. Once approved an E-mail informing the Sales Representatives should be sent out, informing all of the appropriate people involved for shipment.
The Credit assessment Template (CAT) is the standard tool for calculation of the credit limit for customers. 3 years financials data is needed to get the most relevant picture of the company financial health. If CAT cannot generate a risk rating and a maximum grantable credit limit due to insufficient financial data, next level approval must be obtained if the needed credit limit is above 100'000 USD.
The standard credit practice within Trinseo is an open credit limit without a secured interest. Based on the assessment of the financial standing of the customer, the credit department has the discretion to require some tangible security instruments in order to continue the credit approval process. The additional security requirements can include, but are not limited to, any of the following:
a) Irrevocable letter of credit
b) Bank or other financial institution guarantee
c) Corporate or parent company guarantee
d) Personal guarantee of owners or principals
e) Secured collateral interest
The standard corporate payment terms of sale are net 30 days from date of invoice (product shipment) by company check or wire transfer. However, in order to comply with the Country or industry common practices a certain range of payment terms can be granted accordingly.
Refer to Area Credit Policy .
Temporary situations can occur where the credit line is not adequate to cover the short-term business requirements. In these situations, it is up to the credit department who should work in conjunction with the sales team to recommend the most relevant required actions.
All other non-standard terms or conditions should be treated as business cases and therefore require approval from the Credit Director or Group VP Finance & Treasurer and/or VP Business Directors as per the respective DOA.

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5.2 Credit limit Approval
The Chief Financial Officer of Trinseo is authorized to approve the credit matters set out in this Policy and, in accordance with the Authorization and Approvals Matter Policy, is authorized to delegate responsibility for the administration of it to members of the Treasury Team. As such, each credit team member has been assigned a Delegation of Authority (DOA) DOA Type R12 – Credit Limits, and is authorized to approve the credit limit and the related credit matters up to their assigned DOA in the DOA Repository.
Under this Policy, the Delegation of DOA Type R12 cannot exceed the following maximum thresholds:

 	Maximum	Position	
 	USD 1,000,000.00	New Credit Staff (3 months period)	
 	USD 3,000,000.00	Credit Analysts	
 	USD 5,000,000.00	Credit Managers	
 	USD 5,000,000.00	Treasury Managers	
 	USD 10,000,000.00	Global Credit Director	
 	USD 20,000,000.00	VP Finance & Treasurer	
 	USD 30,000,000.00	Executive VP CFO	
 	USD 50,000,000.00	CEO	
Over 50,000,000.00	 	Board of Directors	
 
Credit limit under this Policy is defined as "the maximum financial risk to be incurred with a customer", which should be enough to cover the sum of Accounts Receivable, plus product shipped and not yet invoiced, plus consignment inventory in customer possession, plus guarantees given by Trinseo to third parties for trade sales transactions (contingent liability), plus loans and other financial obligations.
5.3 Alternatives to Credit
The result to the credit evaluation may be a denial of credit to a customer who is assessed as being a too risky or whose level of risk is indeterminable due to insufficient or lack of financial information or background history. The denial of credit does not constitute, and therefore will not be communicated as, a rejection of the customer.
Alternatively, certain secured payment terms can be proposed and/or approved by the credit department and granted to these customers:
a) Cash In Advance (CIA) - payment is delivered to Trinseo and receipt of funds is confirmed by the customer service (Receivable specialist) prior to orders release for the product shipment.
b) Cash on Delivery (COD): Certified funds- payment is made directly to the freight carrier with a check certified by an approved bank of financial institution at the time the product is delivered to the customer.
c) Avalized Draft: bill of exchange to which the aval of an approved bank of financial institution was added. This has value of bank guarantee for the related payment.

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5.4 Credit Control (Holds and Releases)
The credit department is responsible for setting up the appropriate credit order controls in order to trigger an account block or put an order or a shipment on credit hold due to any of the following reasons:
a) Credit Limit is or will be exceeded
b) Payments are overdue or inconsistent
c) Customer faces negative financial path or operational setback
d) Termination of the business relationship with the customer
e) Any other reassessment of risk by the credit department
Due to the sensitive nature of credit hold status, only the credit team members or field sellers can communicate this information to the customer.
The credit department will notify the field seller and customer service representative of any decision of keeping an order on credit hold. The credit department will closely work with the customer service and sales departments to effectively resolve the identified credit issues that caused the credit hold.
No orders or shipments with a credit hold status can be released or shipped without approval from the credit department.
5.5 Bad Debts Reserve
A general reserve is established by allocating specific percentages based upon risk category and aging buckets. The specific reserve is determined after taking into consideration the category defined for the critical account. The reserve %   and related customer category are listed as below:

Customer Category	Risk Category	Past Due Buckets	Reserve %	
Non Critical accounts
General Reserve	Risk Category 1 &   2	 	
0%	
	 	Past dues 31 to 60 days	
10%	
	Risk Category 3	Past dues more than 60 days	
20%	
	 	Past dues 1 to 30 days	
5%	
	Risk Category 4 & 5	Past dues 31 to 60 days	
15%	
	 	Past dues more than 60 days	
30%	
Critical accounts
Specific Reserve	Write-off	 	
100%	
	Serious Financial problem	High probability of bankruptcy or already on Chap11	
100%	
	Heavy past dues (requires special attention)	Allocated percentage could be higher depending on judgment of the Credit Manager	>=10%	
	Down payment plan		
30%	
 
6.0 Appendix
1. Global Customer Assessment procedure
a) EMEA regional credit procedures
b) APAC regional credit procedures
c) NAA regional credit procedures
d) LAA regional credit procedures

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Responsible Department:	Treasury	 	
 	 	 	
Date Effective:	 	 	

Author:	Solange Regorsek Tagro –
Global Credit Director	Signature: /s/ illegible	

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Trinseo Global Credit Procedure	Customer Risk Assessment	
 
General Task Information for Customer Credit Assessment	
Team responsible for this process	Credit Management Team	
Role responsible for this task	Credit Manager and Credit Analyst	
Process Flow Diagram name	TBD	
Input forms/documents required	Front End Filter Questionnaire
New liable request form or/and Customer Credit Data Questionnaire
Financial Statements and/or “Customer Financial Information” template
External Credit Check or Credit Rating Data (Coface, D&B, Orbis etc…)
Internet search of Customer (if available)
Internet VAT number validation
Customer Business Registration Details (if required)
Sales Contracts / Frame Agreement / Purchase Order (if required)
Request form for PT change	
Computer system or spreadsheet used	Customer Assessment Template (Excel Format)
Customer Credit Decision & Recommendation (Power Point Format)
INCA
SAP	
Credit Management Team Process	Trinseo Global Credit Policy	
Output forms/documents produced	Customer Credit Decision &   Recommendation (Credit Limit, Payment Term, Securities and Recommendations).	
Task trigger   (how you know when to start this task)	1.   New customer as per the business Qualification Process or inactive liable code being reactivated.	
	2.   Customer qualified Trinseo based on a sample and Credit Limit need to be set up.	
	3.   A periodic Customer or Corporate review which is triggered by the Credit Risk Score whereby Customers are reviewed on the following cycle:	
	Credit Risk Score	Frequency of Re-assessments	
	1 - Very Low
2 - Low
3 - Medium
4 - High
5 - Very High term was granted to the customer	2 Years
2 Years
1 Years
1 Year
6 Months if an open payment	
	4. Credit limit review where the total exposure is very close or exceeding the granted credit limit.	
	5. Substantial change in the sales and/or criticality of the customers where there is no valid score in the system	
	6. Early Warning Signal	

 
Customer Credit Risk Assessment	1	Company Use Only	

 

 	7. Business specific request	
General Task Information for Customer Credit Assessment	
Delegation Of Authority	Each credit team member is authorised to approve the credit limit and the related credit matter up to assigned Delegation Of Authority.	
	 	
	DOA is set up as follows:	
	 	 	
	USD 1,000,000	New Credit staff (3 months period)	
	USD 3,000,000	Credit Analyst	
	USD 5,000,000	Credit Manager	
	USD 5,000,000	Treasury Manager	
	USD 10,000,000	Global Credit Leader	
	USD 20,000,000	VP Finance & Treasurer	
	USD 30,000,000	Executive VP CFO	
	USD 50,000,000	CEO	
	Over USD 10,000,000	Board of Directors	

 

 
Customer Credit Risk Assessment	2	Company Use Only	

 

Global Trinseo Process	Customer Credit Assessment	
 
General Task Information for Customer Credit Assessment	
Step	Instruction	Example Ref. (copy of
 your report etc or
 other examples of
 docs)	
1.	New Customer and Re-activating liable account in Inca
Field Sellers will request a new liable account creation for a prospective customer as part of the business qualification process. A credit assessment may also be requested if a customer is in the process of being re-activated in Inca, and there is no valid Credit Risk Score in SAP or the Credit Risk Score is to expire shortly (in 3 months).	 	
2.	Customer has qualified Trinseo based on a sample
A sample liable account has been created as per the customer's supplier qualification process. If our products fit with the customer requirement and they agree to enter in business relationship with Trinseo and prior to accepting the first order from them, a credit assessment is required in order to set up the relevant Credit Limit and Payment Term.	 	
3.	Periodic Customer Credit Assessments
Periodic Customer or Corporate credit reviews are required as part of the internal credit review cycle or may be triggered by Credit management Team for other reasons during the cycle (e.g., possible change in customer circumstances, early warning signal etc…).
With respect to the customer re-assessment or the Corporate Review at the internal credit review cycle, rolled out on a monthly basis.
Prior to commencing the review ensure that the customer file and any notes which have been added to the customer folder on the Trinseo server and/or customer Outlook folder are read and familiarise yourself with the recent history of the customer/related entities/group.
A periodic credit assessment of a Customer is only required if there has been sales in the last 12 months. If there have been no sales with the customer for 12 months, the liable account should be inactivated in the system.
In Inca mark the liable account as inactive as per the related process.	 	
4.	Credit Limit Review
Credit limit review is required where the total exposure is very close or exceeding the granted credit limit. A credit assessment could also be triggered by a substantial change in the sales and/or criticality of the customers where there is no valid score in the system. The credit assessment is only required if:	 	

 
Customer Credit Risk Assessment	3	Company Use Only	

 

 	 	 	
General Task Information for Customer Credit Assessment	
Step	Instruction	Example Ref. (copy of
 your report etc or
 other examples of
 docs)	
 	 The Customer passes through the front-end filter.
 The next review date close (3 months)
 Current credit limit was based on financials more than 12 months old.
 However there may be instances where the FS request a Customer credit assessment, when normally it would not be required (intend to grow business, change in payment term, prices increase, etc…). In such instances, it there is a Business need, the credit assessment may be completed.
Confirm whether the Customer already has a valid Credit Risk Score. If the Credit Risk Score is current, check the age the financials used for the last assessment. If these financials are less than 12 months old base your new credit limit on the last assessment. Update Inca with the needed credit limit. Next review date is automatically calculated as per the internal credit review cycle.	 	
5.	Each time a credit assessment is being completed, the following data should be gathered:
-      New credit data questionnaire: In the case of a Corporate Review, a credit data questionnaire is requested for each liable account. Also ensure to get one credit data questionnaire from each business dealing with the customer.	Credit Data
Questionnaire	
	-      Request financial statements from related the Field Seller, if not available to the credit agency (last 3 years financials if possible). If the assessment has been initiated as part of the internal credit review cycle, this request should be made to the field seller or the key account manager. It is the sales department responsibility to obtain financial statements in case they are not available in the data provider platform in use, however the Credit Management Team may provide assistance when requested, “Customer financial information” template can be   provided to the FS for use.	Financial Statements

	-      Complete an Internet search to identify any current news about the company. This should include a review of the customer's website.	Credit Agency Report	
6.	Methods to obtain Financial Information:
-      Most of customers' financials in Europe could be retrieved directly from the BVD platform.
-      If the customer is listed on stock exchange, financial information may be published on the internet otherwise it may be available directly from the Customer.	Template – Non-
disclosure Agreement	

 
Customer Credit Risk Assessment	4	Company Use Only	

 

 	 	 	
General Task Information for Customer Credit Assessment	
Step	Instruction	Example Ref. (copy of
 your report etc or
 other examples of
 docs)	
 	-      If the customer is unwilling to give financial data directly to FS, they may be comfortable to send this information directly to the CMT upon signing of a Non-disclosure Agreement.
-      Ask whether the customer is willing to provide some key financial information. If so, email the ‘Company Financial Information’ Template.
-      Ask whether CMT Staff can visit the customer and view the financials on-site.	 	
7.	Credit Data Questionnaire
Credit Data Questionnaire provided by the FS should contain sufficient background information to complete the assessment.
The following information should be completed in order to have a better understanding of the customer:
-      Trinseo Business dealing with the customer
-      Customer status: Prospective / Existing / Previous
-      Legal entity name of the company that Trinseo is dealing with.
-      Criticality data
-      Guarantees held
-      Comments about the Customer. Any information that could help CMT to get a better understanding of the customer.
-      If the questionnaire indicates that Trinseo has a Parent Company Guarantee (PCG) from the Customer, the original should be obtained and filed by Trinseo CMT. A credit assessment should be completed based on the financials from the parent in order to determine if the PCG is valid and/or if a Credit Limit could be granted to the customer (depending on the group structure.)	 	
8.	Parent/Subsidiary/Legal Entity
In case a Customer does not produce separate financials or provides weak financials, if the Customer belongs to a group, the financials of the Parent entity can only be used if:
-      A Parental Guarantee has been provided that covers all Orders and Agreements for all Trinseo entities.
-      The Group has a cash pooling system. This practice is very usual in certain countries such as Germany (This is typically acknowledged in the financial notes of the Annual Report.)
-      The parent has guaranteed the debts of it subsidiary via a Letter of Liability (some countries allow parent entities to officially lodge a Letter of Liability to cover the debt of subsidiaries. This is typically acknowledged in the financial notes of the Annual Report.)	Credit Data
Questionnaire	

 
Customer Credit Risk Assessment	5	Company Use Only	

 

 	 	 	
General Task Information for Customer Credit Assessment	
Step	Instruction	Example Ref. (copy of
 your report etc or
 other examples of
 docs)	
 	If a Customer has a Sister entity, the financials of the Sister company can only be used if:
-      A cross guarantee exists between the Sister and the Subsidiary (both entities must belong to the same group as per the corporate structure.)	 	
9.	Credit Assessment Template (CAT)
Complete the customer credit assessment using the Customer Credit Template (CAT). The CAT is a standardized template designed to simplify the credit assessment process. The information required to complete this form may come from various sources.
Key points to note regarding completion of each section:
Section A
-      Select all Businesses dealing with the customer: This information should be provided by business. It also could be retrieved via Business Object or Data Warehouse.
-      Ensure that the raison for credit assessment is selected.
Section B
-      It is vital that Trinseo knows with which legal entity it has a contractual relationship. If there is doubt about the legal entity that requires the credit assessment, request confirmation from the field seller.
-      Ensure the corporate structure is reviewed with each credit assessment and that the parent company is correctly identified.
Section C
-      Using the rating from the Credit Agency Report, translate this rating into an internal Risk Score. Use the ‘External Ratings’ spreadsheet to determine how the rating should be translated into an internal score.	 	
 	Section D
-      Consult the customer web site to get as much information about the company as possible	 	

 
Customer Credit Risk Assessment	6	Company Use Only	

 

 	 	 	
General Task Information for Customer Credit Assessment	
Step	Instruction	Example Ref. (copy of
 your report etc or
 other examples of
 docs)	
 	-      Use the credit agency report and corporate structure information to confirm the ownership structure, Information about the size of the company could also be get from this report
Section E
-      Whilst the FS will provide an estimated forward looking spend, where possible, obtain from SAP ABAP report or Business Object the total sales of the past year with the customer.
-      Because the range in the ‘criticality fields’ is quite wide, where there are actual values shown in the credit data questionnaire, add this to the remarks/comments section.
Section F
-      Always enter financial data in the local currency of the Customer in the “Financial Data” of the CAT.
-      Only input financials where both the balance sheet and profit & loss statement for the same period are available. Partial financials or key data from part-year results could also be used. A comment should be entered in the Section I.
-      Use the Blumberg screen (if available) or SAP transaction TM08 to obtain the exchange rate with USD as of the customer account closing date where required
-      Review securities provided, in particular obtain copies of any parent company guarantees; confirm they are still valid; what they cover and if they have an expiring date.
-      Check if it is updated in SAP transaction “TM31”, Table “692”.
-      A Credit Risk Score cannot be calculated unless there are at least two consecutive years of financial statements provided. If this is not available, the Credit Risk Score will be “No Data”.
Section G
-      Ensure that Early Warning Signals have been validated prior to being selected.	Customer Credit
Assessment Template	

 
Customer Credit Risk Assessment	7	Company Use Only	

 

 	 	 	
General Task Information for Customer Credit Assessment	
Step	Instruction	Example Ref. (copy of
 your report etc or
 other examples of
 docs)	
 	Section H
-      Any changes to the automatically calculated risk score or criticality score needs to be justified using the provided comments field provided.
-      Select the Final Risk Score from the drop-down list. The “Overall Risk Score” is the same as the Risk Rating. However the score “No Data” could be given due to lack of financial information. Financial risk category will automatically appear when select the risk score:
       1 = Very Low Risk
       2 = Low Risk
       3 = Medium risk
       4 = High Risk
       5 = Very High Risk
       9 = No Data
-      “Computed Credit Limit” & “Optimal Timely Payment” are the two methodologies used to calculate the maximum exposure that should be incurred.
-      “Supported Credit Limit” is the actual maximum Credit Limit gran table to the customer.
-      The ‘Next Review Date’ is the expiring date of the risk score. This is determined as per the Trinseo Credit Policy.
Section I
-      Three areas should be covered in the comments section:
       Background of Customer; what they buy from Trinseo and any bankruptcy proceedings, court rulings, and positive/negative information.
       Describe and comment Criticality.
       Review of financials and any qualitative information considered relevant. If parent financials were reviewed, add a comment confirming the level of health of the parent.
Section J
-      Comment on the criticality score, risk score and overall risk score.
-      Provide the final “Credit Decision”
-      Provide any further recommendations	 	

 
Customer Credit Risk Assessment	8	Company Use Only	

 

 	 	 	
General Task Information for Customer Credit Assessment	
Step	Instruction	Example Ref. (copy of
 your report etc or
 other examples of
 docs)	
10.	Credit Decision & Recommendation Approval
Once the credit assessment is complete, add the information to the Customer “Credit Decision &   Recommendation” and proceed as follows:
-      If the requested (or needed) Credit Limit is below or equal to DOA, email the credit assessment outcome to the FS, CSR and RS and Management (only attach the “Credit Decision & Recommendation” if the risk score is 4 or No Data). Update Inca and/or SAP with the relevant items.
-      If the requested (or needed) Credit Limit is above the DOA, a documented approval request should be sent via the “Customer Credit Decision & Recommendation” template to the next level.
***If parent financials have been obtained and reviewed, these are to be included. The Corporate Structure should also be added to the “Customer Credit Decision & Recommendation” where available.
Once the Credit Assessment has been reviewed by Management, the final Credit Risk Score, the Requested Credit Limit and the Credit Recommendation have been agreed and approved, the Credit Assessment Template and Credit Recommendation Template are to be updated as necessary. Email the final outcome to the FS, CSR, RS and copy Management where Risk score is 4, 5 or No Data.
Place a hardcopy of the finalised “Customer Credit Decision & Recommendation” into the customer file.	 	
11.	Follow up of Credit Recommendations
Make sure that credit recommendations are actioned.
For those recommendations where there are specific action items, such as obtaining financials, guarantees, undertakings, letters of comfort or specific information to clarify the company situation, the responsible Credit team Member is to follow up with the Business until the action has been completed.
Results of the action should be assessed to determine if the Credit Risk of the customer has reduced as a result of the action being executed.
***Do not forget to update the system (Inca and/or SAP) and the Master Progress report	Credit Recommendation
Template	

 

 
Customer Credit Risk Assessment	9	Company Use Only	

 

Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_PreCollection_Procedure_L6.doc	

Pre-Collection Procedure for Customer Facing Role

Introduction/
Purpose	   	This document describes one of the Customer Service Work Processes, that when applied consistently provides predictable outputs and a reduction in process variability. Executing this process effectively will maximize value creation and enable employees to successfully execute the tasks required for daily operations.	
Scope	 	This procedure describes the detailed activities required for securing payment information on target invoices prior to their due dates. It is extremely important to perform pre-collection activities on targeted invoices to increase Dow’s cash flow, reduce days sales outstanding (DSO), and increase percent current.
Please note: Any payment information entered into the Credit Sufficiency Matrix will only take into effect 10 days prior to the due date. This is only applicable for those areas utilizing the Credit Sufficiency Matrix
On a daily basis, each Receivable Specialist is responsible for identifying invoices that meet requirements for pre-collections (i.e. invoices coming due within the next 10 days and are over $100,000 USD). The Receivable Specialist, with the assistance of the Supporting Activities Leveraged Team, will need to secure payment information on those invoices.
Pre-collection activities should be intensified at month-end, quarter-end, and year-end in order to minimize the accounts receivable exposure, increase cash flow, and reduce DSO.
It is the decision of the Receivable Specialist, with input from the respective Credit Manager, to opt to pre-collect all invoices on the account versus big ticket items only. Situations where pre-collections are a priority: customer receives consolidated invoices, customer is high risk, customer routinely pays late or has excuses, customer invoices frequently have errors which prevent payments from being processed on time.	

 

 

 

 

 
 
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_PreCollection_Procedure_L6.doc	

Pre-Collection Procedure for Customer Facing Role, continued

 	    	 	
Related	 	Exceptions:	
Documents	 	 	
 	 	North America	
 	 	 	
 	 	Pacific	
 	 	 	
 	 	Flow Chart:	
 	 	 	
 	 	Pre-Collection Flow Chart	
 	 	 	
 	 	Job Aids:	
 	 	 	
 	 	Creating a Pre-Collection Report - YDT1	
 	 	Reviewing DTS text - YDT2	
 	 	Reviewing Customer Credit Info - YFCC	
 	 	Reviewing/ldentifying Account Contacts in Siebel	
 	 	Reviewing Notes on Account - Siebel	
 	 	Displaying Document Flow - TV81	
 	 	Displaying Document History - TV81	
 	 	Displaying a QM - QM03	
 	 	Updating DTS YDT2	
 	 	Mass Maintenance Update YFCC	
 	 	Entering a SAR	
 	 	Creating   a Service Request with Activity Plan	
 	 	 	
 	 	Other:	
 	 	 	
 	 	Global Discrepancy Reason Codes	

 

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_PreCollection_Procedure_L6.doc	

Pre-Collection Procedure for Customer Facing Role, continued
 
Process	   	The following describes the various steps required to execute this work process.
These steps are for the Customer Facing Receivable Specialist rule.	

Step	  	Procedures	  	
1	 	 Identify a list of invoices that qualify to be pre-collected based on the requirements for your area and business. Refer to your area exception list for the requirement for the area.
 Utilize the job aid called “Creating a Precollection Report – YDT1,” to pull a list of invoices on your RS match code.
o Variants have been created which will bring in the required data. Refer to your area exception list for variant name.
 Remember to execute a report for your RS# in all clients that you have accounts in. If unsure if open receivables are located in other clients, utilize the Cross Client report that is on the PR&H website.
Note: the transaction amount and days late can change based on the business/customer exceptions. If your business or customer base does not have exceptions, the rule of invoices over $100,000 USD coming due in the next 10 days applies
Note: if the Specialized Leveraged team contacts you indicating they are starting the statement process for your customers, stop doing pre-collection on your accounts until you receive notification from the Specialized Leveraged team that they are finished.		
2	 	 Identify any invoices/accounts that should be excluded based on previous exceptions. Refer to any area pre-collection spreadsheets for this type of information.
 Review DTS text, Siebel, YFCC, TV81, QM03 on the invoices identified to determine if the invoices should be excluded from pre-collections. Refer to the following job aids:
o Reviewing DTS Text – YDT2
o Reviewing Customer Credit Information – YFCC
o Displaying Document History – TV81
o Displaying Document Flow – TVB1
o Displaying a QM – QM03
o Reviewing Notes on Account - Siebel		

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_PreCollection_Procedure_L6.doc	

Pre-Collection Procedure for Customer Facing Role, continued

Step	  	Procedures	  	
3	 	 If invoices should be excluded due to return of entire invoice or other outstanding issue on invoice, input a reason code on the invoice via YDT2 to identify the root cause as well as update DTS text with the issue.
o Refer to the job aid called “Updating DTS- YDT2”
o Review the “Discrepancy Reason codes” for a complete list of the discrepancy reason codes that should be applied to the item.
 If additional invoices require action, repeat the process.
 If multiple invoices exist with the same issue – you may use mass maintenance to update those invoices. Refer to the job aid called “Mass Maintenance Update - YFCC.”		
4	 	 If for any particular customer there are more than 5 invoices that need to be pre-collected, request the Specialized Leveraged Team completing supporting activities to send a statement (see Step 6) to the customer.		
5	 	 Contact the customer once all the investigation has taken place to secure payment information and/or identify if items are set to be paid so we receive the money prior to the due date.
 Utilize Siebel to locate accounts payable contact information. Refer to the job aid “Reviewing/Identifying Account contacts in Siebel” for further information.
 If payment information has been received, utilize the job aid called “Mass Maintenance Update -YFCC,” to update payment information.
 If the customer was contacted and a response was not received at the time of the contact, update DTS on the item(s) indicating the items were pre-collected. Utilize the job aid called, “Updating DTS - YDT2,” to record actions taken. Utilize the reason code GD for item that was pre-collected and record in segment text and DTS text the actions taken. The text information should indicate the date and to whom a contact was made to and how (i.e. phone, email, fax).
 If the customer has a discrepancy or requires backup documentation proceed to the next step.		

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_PreCollection_Procedure_L6.doc	

Pre-Collection Procedure for Customer Facing Role, continued

Step	  	Procedures	  	
6	 	 If the customer requests a statement of account or proof of delivery, request the Specialized Leveraged Team performing supporting activities to complete this task via a Siebel Service Request. Utilize the job aid. “Creating a Service Request with Activity Plan” to initiate the request.
 If the customer requests a copy of the item (invoice/debit memo), utilize Documentum (GID) to request the copies. If there are multiple items that are needed, a Siebel Service Request can be initiated to have the Specialized Leveraged Team completing supporting activities complete the task.		
7	 	 If customer has a discrepancy from Step 5, follow up to ensure corrective action has taken place. If sales adjustment (other than a return order) is needed, enter a SAR to the appropriate delegates, ensure that the Specialized Leveraged Team completing Sales Adjustment is the “RS” as they will receive the approvals and issue the sales adjustment(s) as necessary, refer to area exceptions. Select yourself under Informational. Refer to the job aid called “Entering a SAR” for further details. Refer to the area exception spreadsheet for appropriate contact for “RS” field.
 If return order is needed, enter QM utilizing the QM Script, if appropriate. Refer to the CAMP website for the script as needed.		
8	 	 Update DTS on the item(s) to indicate the actions taken. For example, if SAR or QM was entered, remember to log all information into DTS and set the appropriate follow up date. Refer to the job aid called, “Updating DTS – YDT2,” for further details on how to update this text.		
9	 	 Retrieve “Informational” SAR from your personal email box to see completion of sales adjustment.
 Communicate discrepancy resolution to customer.		

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_PreCollection_Procedure_L6.doc	

Pre-Collection Procedure for Customer Facing Role, continued

Document Owner	  	It is the responsibility of the Payment Receipt & Handling (PR&H) Global Process & Technology Leader (GPTL) within the Customer Service Expertise Center to ensure this document is kept current and distributed to the appropriate personnel affected by these procedures.	  	
Document History	 	Below are at least the last three revisions of this document, including all revisions within the last three months. Approvals require that revisions to related documents were also made.	 	

Date	Revised By	Changes	Version Number	
09/03/09	Roxann DeBeau	Added Pacific Area Exception	4	
7/29/08	Susan Erndt	New format, added related documents section, and document owner section.	3	
4/1/08	Susan Erndt	Split document by roles	2	
10/20/07	Susan Erndt	Created Document	1	

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_CollectionsProcedure_L6.doc	

Collections Procedure - Customer Facing Role
 
Introduction/ Purpose	  	This document describes one of the Customer Service Work Processes, that when applied consistently provides predictable outputs and a reduction in process variability. Executing this process effectively will maximize value creation and enable employees to successfully execute the tasks required for daily operations.	  	
Scope	 	This procedure describes the detailed activities required for the Customer Facing Role for securing payment information on target invoices once they become due.	 	
 	 	It is extremely important to perform collection activities on targeted invoices to increase Dow’s cash flow, reduce days sales outstanding (DSO), and increase percent current.	 	

 

Revised: 10 Aug 2011 - 11:12 AM
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_CollectionsProcedure_L6.doc	

Collections Procedure - Customer Facing Role, continued

Related Documents	  	Flow Chart:	  	
 	 	 	 	
 	 	Collections Flow Chart	 	
 	 	 	 	
 	 	Exceptions:	 	
 	 	 	 	
 	 	Latin America	 	
 	 	North America	 	
 	 	EMEA	 	
 	 	Pacific	 	
 	 	 	 	
 	 	Job Aids:	 	
 	 	 	 	
 	 	Collections Initial Report - YDT1	 	
 	 	Reviewing Customer Credit Info - YFCC	 	
 	 	Displaying Document Flow - TV81	 	
 	 	Displaying Document History - TV81	 	
 	 	Reviewing Items on Account - TB14-15	 	
 	 	Reviewing Item Details - YFCC	 	
 	 	Displaying RV Invoice - TA93	 	
 	 	Updating DTS - YDT2	 	
 	 	Updating Documents - YFCC	 	
 	 	Mass Maintenance Update - YFCC	 	
 	 	Creating Collection Follow Up Report - YDT1	 	
 	 	Entering a SAR	 	
 	 	Creating a Siebel Service Request with Activity Plan	 	
 	 	Determining if a QM Already Exists - QM03	 	
 	 	Resolving Manual Rock - YRC2	 	
 	 	Reviewing/Identifying Account Contacts - Siebel	 	
 	 	View Requests - SAR	 	
 	 	ACE Tool User Guide	 	
 	 	 	 	
 	 	Other:	 	
 	 	 	 	
 	 	Discrepancy Reason Codes	 	

 

 
 	 	 	
Revised: 10 Aug 2011 - 11:12 AM
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_CollectionsProcedure_L6.doc	

Collections Procedure - Customer Facing Role, continued
 
Process	  	The following describes the various steps required to execute this work process. These steps are for the Customer Facing Receivable Specialist role.	  	

Step	  	Procedures	  	
1	 	 Identify a list of invoices that qualify for collection in the initial collection contact. Utilize transaction YDT1 to review list of invoices, refer to area exceptions:
o Remember to log into all clients that you have accounts assigned to your RS code to complete collections on those accounts you are assigned. If you are unsure if open receivables exists in other clients, utilize the Cross Client report on the PR&H website as appropriate. Refer to your area exceptions for any area specifics.
o Refer to the job aid called, “Collections initial Report – YDT1.”
o The variant called, “ Collections1 ” has been created which will bring in the required data.
o Once list appears, sort by customer name. If the report is lengthy, sort various ways to ensure old items are captured as well.	 	

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_CollectionsProcedure_L6.doc	

Collections Procedure - Customer Facing Role, continued

Step	  	Procedures	  	
2	 	 Start with the first customer - identify all invoices which are past due for that customer (be sure to review YFCC for any invoices coming due the current day or the week to eliminate duplicate calls). These items are 0 days late. Be sure to complete various sorts on report in case the report is lengthy. Sort by days late in order to capture those invoices that are very old.
 Refer to the job aid called, “Reviewing Customer Credit Information – YFCC” for further assistance.
 Research the invoice(s) to see if any QMs, previous adjustments, pending adjustments, payments on account exist for the invoice:
o If the item is a PK08 and a stop payment or insufficient funds, you will need to utilize TB14/15 to review the clearing for the customer. The customer will need to remit payment for these items again as for some reason the original payment was stopped, however, the items were still cleared from the customer’s account. Refer to the job aid called, “Reviewing Items on Account – TB14/15.”
o Review customer account for open payments. If there are open payments on account review payments for status to see if they will automatically be applied by CISS or need manual application. Refer to your area exceptions for appropriate guidelines.
o Review invoice history via transaction TV81 to see if any previous adjustments have been issued. If so, take note of the adjustments. Refer to the job aids called “Displaying Document History – TV81” or “Displaying Document Flow - TVB1.”
o Review customer account (YFCC or TB14/15) to see if adjustments are open on account. If adjustments are open, take note of adjustments – review details on previous and pending adjustments and communicate to customer when contacting them for payment information. Refer to the job aid called “Reviewing Item Details on Customer Account – YFCC” or “Reviewing items on account TB14-15.”
o To see if any pending QM’s exist against an invoice, retrieve the order number from the invoice (Transaction TA93), then go to transaction QM03. In the Quality Message field use =O..XXXXXXX (where XXXXXX is the order number). Refer to the job aid called, “Determining if a QM Already Exists – QM03.” If QM is found, review the QM by viewing the QM in QM03, refer to the job aid called, “Displaying a QM – QM03,”	 	

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_CollectionsProcedure_L6.doc	

Collections Procedure - Customer Facing Role, continued
 
Step	  	Procedures	  	
2,
cont	 	o If QMs exist, review to determine it they require pending adjustments (returns, quality, etc). Take note to advise customer of pending issue. It QM indicates a full return of the invoice, document this on the invoice in DTS. Ensure you properly code the item for root cause using Global Discrepancy Code List. Update segment text and DTS with information regarding the return. Add a follow up date to ensure follow up on the item. Refer to the job aid called. “Updating DTS-YDT2.”
o Review the SAR database for any pending sales adjustments as appropriate, refer to your area exceptions for details. Refer to the job aid called “View Requests.”
 Continue this research on all invoices for each customer.	 	
3	 	 If a customer statement is preferred, submit a Service Request to the Supporting Activities team for that specific customer/location. Refer to the job aid called, “Creating a Siebel Service Request with Activity Plan.”
 Refer to the individual work processes on the PR&H Supporting Activities website for more details.	 	
4	 	 Contact the customer for payment information. Utilize Siebel to find the customer accounts payable contact information. Refer to the job aid called, “Reviewing/Identifying Account Contacts – Siebel” for further details.	 	
5	 	 Document contacts:
o Document any requests made to the Supporting Activities team in DTS. Be sure to add a follow up date of 2 business days and the Request number from Siebel to DTS text. Refer to the job aid called, “Updating DTS-YDT2.”
o If contact was made to customer and a message was left or email sent - update DTS indicating that you left a message and to whom you left a message-ensure reason code is coded as HC for left message, segment text indicates you left a message and the date that you made the contact, and add a follow up date (2 business days after initial contact). Refer to the job aid called, “Updating DTS-YDT2.”
o If customer provided payment information - update the follow up dates and the credit sufficiency matrix, if this is utilized in your area. Refer to the job aid called, “Updating Documents-YFCC.”
 Update the check # (if available), dollar value, payment transfer date (either mail or date being transmitted), payment method, and who was contacted and date contacted, if needed.
 Add follow up date to ensure payment is received. Utilize 3 business days for e-payment or 5 business days for check payment.
 Repeat for all invoices.
o If any other issue arises due to the contact with the customer, i.e. need copy, price discrepancy, etc, ensure that you use the appropriate Discrepancy reason code to code the item, update DTS, follow up date, and segment text.	 	

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_CollectionsProcedure_L6.doc	

Collections Procedure - Customer Facing Role, continued
 
Step	  	Procedures	  	
6	 	 If updating many invoices on the customer’s account use mass maintenance. Refer to the job aid called, “Mass Maintenance update – YFCC” for further information.
 Repeat for all accounts as necessary	 	
7	 	 If customer indicates issue with invoice
 Review the appropriate PR&H Business Rules for your area for action to be taken.
o Enter QM as appropriate for quality, quantity issues, etc. Use the ICAMP script. Refer to the job aid called, “Entering a QM – QM01,” for further details.
o Request approval for any sales adjustment via SAR. Refer to the job aid called, “Entering a SAR” for further details. Refer to your area exceptions for any exceptions to this step.
 Ensure that you indicate the Specialized Leveraged Team performing sales adjustment activities as the Receivable Specialist to issue the adjustment.
 Once sales adjustment has been issued or QM resolved, contact customer as follow up to ensure customer pays invoice as necessary.	 	
8	 	 Once all initial invoices have been addressed, run another YDT1 report to capture those that have follow up dates of current day and previous.
 Refer to the job aid called, “Creating a Collection Follow-up Report.”
 The variant called, Collections2, has been created to assist with running this report.
o You must update the “TO” date to the currant date in the Follow up date field.
 Once list appears, sort by customer name or if report is lengthy, complete various sorts to capture older items.	 	

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_CollectionsProcedure_L6.doc	

Collections Procedure - Customer Facing Role, continued
 
Step	 	Procedures	 	
9	 	 Follow up actions:
o Use a variety of methods to contact customer. If customer was initially contacted by email, call the customer the second time. Be sure to use the phone to call the customer and leave a message if needed to ensure that a relationship is built between the customer and yourself.
o If Leveraged Team sent a statement, invoice copy or POD and no response was received from the customer, call the customer to follow up for payment information
 If a message was left, update DTS text, indicating a message was left and with whom, update the reason code with HC, update segment text, and add a follow up date of 2 business days out. If the invoice is more than 15 days past due and this is only the second time contacting customer, then at the next follow up date, escalate to field seller if a response was not received from the customer. Refer to the job aid called, "Updating DTS-YDT2."
 If customer indicates they do not have enough money to pay or will not be paying as customer has different terms than we have set up or any other "red flag" issue, escalate immediately to the credit manager and field seller for assistance in collecting. Be sure to update DTS text, follow up date, reason code, and segment text with actions taken. Refer to the job aid called, "Updating DTS-YDT2."
 If you receive payment information, update credit sufficiency matrix/DTS and follow up date based on date of payment. Refer to job aid called, "Updating Documents-YFCC."
 Repeat for all invoices.
 If customer indicates they are not paying invoice due to an error on the invoice. Escalate as necessary:
o If for quantity/quality issues – enter QM using the ICAMP script. Refer to the job aid called, "Creating a QM – QM01.”
o If any other discrepancy issue (i.e price, freight, tax, etc), enter SAR as appropriate for your area, refer to the area exceptions for details. Ensure the Specialized Leveraged Team completing sales adjustment activities is the RS on the form to issue the final sales adjustment. Refer to the job aid called, "Entering SAR" for further details.
o Contact seller or CFS, if necessary, for assistance.
 If customer indicates that they need a copy of a statement, invoice, or POD, submit a Service Request.	 	

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_CollectionsProcedure_L6.doc	

Collections Procedure – Customer Facing Role, continued
 
Step	 	Procedures	 	
10	 	 Once items are 15 days past due and you have not received a response from the customer, escalate to the field seller for assistance in collecting the invoice.
o Before you escalate, ensure the following has been completed:
 Contact or attempt to contact your accounts payable at least twice – with a variety of different methods (phone and email).
 If no contact with accounts payable, try to reach another contact at the customer (i.e. supervisor, backup, or purchasing) as appropriate for your area, refer to the area exceptions.
o Use the appropriate contact lists if available to identify the field seller.
 Provide the necessary details to the field seller to assist them with collection:
o Invoice Number
o Customer PO#
o Product(s)
o Value of invoice
o Ship To customer/location
o Date of Invoice
o Quantity and price billed
o Details of contacts information (i.e. date message left for customer)
o Who at the customer was contacted
 Once email has been sent to field seller or voice mail left, update DTS indicating that the invoice was escalated to the field seller (indicate who the seller is).   Refer to the job aid called, "Updating DTS – YDT2."
 Update Follow up date for 2 business days and continue to follow up with field seller, until resolved.
 Update the "represent" field in TB02 with a 1 which means you escalated to the field seller as appropriate for your area. Refer to your area exceptions. Refer to the job aid called, "Updating DTS-YDT2," for further information.
 Repeat for all invoices as necessary.	 	
11	 	 Once payment information is obtained by field seller, update credit sufficiency matrix/DTS with information and set follow up date on item based on type of payment (3 days for e-payment and 5 days for check payment). Refer to the job aid called, "Updating Documents – YFCC."
o Repeat for all invoices.
 If field seller does not have payment information but requests you to call the customer or provides other actions for you to take, perform those tasks and be sure to update DTS, follow-up date, and credit sufficiency matrix/DTS as appropriate.	 	

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_CollectionsProcedure_L6.doc	

Collections Procedure - Customer Facing Role, continued

Step	 	Procedures	 	
12	 	 If invoice is open at 30 days past due and field seller was unable to assist in obtaining payment information, escalate to the Credit Manager assigned to the customer’s account via email.
o Before you escalate, ensure the following has been completed:
 Contact or attempt to contact your accounts payable at least twice – with a variety of different methods (phone and email).
 If no contact with accounts payable, try to reach another contact at the customer (i.e. supervisor, backup, or purchasing) as appropriate for your area, refer to the area exceptions.
 Request assistance from account manager via a variety of methods (i.e. email, phone) and follow up with account manager every 3 business days.
 Provide the necessary details to the credit manager seller to assist them with collection:
o In the subject line, enter “OVER 30 DAYS, CUSTOMER NAME, LIABLE#” in order to get the credit managers attention.
o Invoice Number
o Customer PO#
o Product(s)
o Value of invoice
o Ship To customer/location
o Date of Invoice
o Quantity and price billed
o Details of contacts information (i.e. date message left for customer)
o Who at the customer was contacted
o Outline efforts to work with seller to resolve
 Once email has been sent to the credit manager, update DTS indicating that the invoice was escalated to the credit manager (indicate who the credit manager is). Update Follow up date for 5 business days and continue to follow up with credit manager until the item has been paid. Refer to the job aid called, "Updating Documents – YFCC."
 Update the segment text indicating the items were escalated to CFS.
 Update the "represent" field with a 2 which means you escalated to the credit manager as appropriate for your area. Refer to your area exceptions.
 Repeat for all invoices as necessary.
Note: The RS may need to get involved again at this point when the credit manager requests assistance. Remember that you are responsible for this invoice until paid, therefore, continue to follow up to ensure item is resolved.	 	

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_CollectionsProcedure_L6.doc	

Collections Procedure - Customer Facing Role, continued

Step	  	Procedures	  	
13	 	 Once payment information is obtained by credit manager, update credit sufficiency matrix/DTS with information and set follow up date on item based on type of payment (3 days for e-payment and 5 days for check payment). Refer to the job aid called, “Updating Documents – YFCC.”
 Repeat for all invoices.
 If Credit manager indicates item is on legal hold (i.e. bankrupt customer), update reason code to G7, update DTS and Segment text with necessary information from Credit Manager.   Update follow up date with a date 3 months from current date and follow up with credit manager every 3 months to ensure legal items are resolved.
o Refer to any area exceptions for specific steps for your area.	 	
14	 	 Receive ROCK for invoice greater than 7 days past due without a reason code.
 Investigate invoice and contact customer as appropriate and code the invoice.
 If payment information is received, update payment information on the invoice, by selecting the Payment Info button in ACE on the My ROCKS tab. You will be prompted to fill in the details of the payment information obtained and once you press OK, it will update SAP as well as assign a follow up date based on that payment information (3 business day for e-payment; 5 business days for check). Please refer to job aid “ACE Tool User Guide” for further instructions.
 Take action to resolve the invoice.
 Resolve the ROCK by either using the “Resolve” button in the ACE tool or manually resolving the ROCK. Refer to the job aid called, “Resolving Manual ROCK – YRC2.”	 	

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_CollectionsProcedure_L6.doc	

Collections Procedure - Customer Facing Role, continued

Document Owner	  	It is the responsibility of the Payment Receipt & Handling (PR&H) Global Process & Technology Leader (GPTL) within the Customer Service Expertise Center to ensure this document is kept current and distributed to the appropriate personnel affected by these procedures.	  	
Document History	 	Below are at least the last three revisions of this document, including all revisions within the last three months. Approvals require that revisions to related documents were also made.	 	

Date	Revised By	Changes	Version Number	
07/08/10	Roxann DeBeau	Add Latin Area Specifics	7	
09/03/09	Roxann DeBeau	Added Pacific area specifics link	6	
7/16/09	Susan Erndt	Updated EU/IMEA specifics	5	
9/19/08	Susan Erndt	Added document owner	4	
7/29/08	Susan Erndt	New format and added related documents.	3	
4/1/08	Susan Erndt	Split document by roles	2	
11/14/07	Susan Erndt	Created Document	1	

 

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_PaymentAllocationProcedure_L6.doc	

Manual Payment Allocation Procedure - Customer Facing Role

Introduction/ Purpose	  	This document describes one of the Customer Service Work Processes, that when applied consistently provides predictable outputs and a reduction in process variability. Executing this process effectively will maximize value creation and enable employees to successfully execute the tasks required for daily operations.	  	
Scope	 	This procedure details the steps that the Customer Facing role will need to perform in order to have a payment manually applied on a customer’s account. This procedure will be used when payment backup is not available at the time of cash application in Customer Invoicing & Settlement Services (CISS).	 	
Related Documents	 	Area Exceptions:
North America
Pacific
Job Aids:
Creating a List of Open Payments - YDT1
Updating DTS - YDT2	 	

 

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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_PaymentAllocationProcedure_L6.doc	

Manual Payment Allocation Procedure - Customer Facing Role, continued

Process	  	The following describes the various steps required to execute this work process. These steps are for the Customer Facing Receivable Specialist role.	  	

Step	 	Procedures	 	
1	 	 Identify an open payment (PK16) on account that has a reason code of GA. These will be identified during the manage discrepancy process.
 Transaction YDT1 can also be used to identify the PK16 with reason code of GA open on your RS match code. Refer to the job aid called “Creating a list of Open Payments – YDT1.”
o Remember to review open payments in all the clients that you are assigned accounts. Refer to the Cross Client report on the PR&H website for your area for details.
 You may also receive emails from the Specialized Leveraged team completing Discrepancies indicating there are open payments on the account and they need backup to resolve them.	 	
2	 	 Contact the customer for the remittance detail for the payment received.
 Update DTS on the item(s) indicating that you have contacted the customer for the remittance information. Follow up with the customer in 2 business days if you do not receive the information. Refer to the job aid called, “Updating DTS – YDT2.”	 	

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_PaymentAllocationProcedure_L6.doc	

Manual Payment Allocation Procedure - Customer Facing Role, continued

Step	  	Procedures	  	
3	 	 Once you receive the remittance detail, forward the remittance to the Specialized Leveraged team completing discrepancies to offset. Be sure the remittance includes the document number (whether invoice, delivery note, etc) and the value the customer is paying against this item. The team will not process the offset unless there is backup that is received from the customer. Please refer to area exceptions .  For example, if you request the team to offset invoices 123 and 456 with doc # X, then you will need to have remittance detail from the customer in order for the team to accurately apply the payment.
 In the beginning of the subject line of the email, be sure to indicate the priority by using the following as a guideline:
o ASAP – to be completed within 2 hours
o High – to be completed within 4 hours
o Normal – to be completed same day if received between 8am and 3pm. All requests after 3pm to be completed by noon the next business day.
o Low – to be completed within 48 hours
 The team will process an offset where the payment is on account, the original invoice has been canceled and the new invoice is on the account. Please be sure to explain this situation in your email to the team. They will keep the email as backup after they offset.
 Be sure to include the following information in your email: Refer to your area specifics for any area details .
Liable#:
Client / Company Code:
Document number of payment and value to be offset:
Document numbers to offset, if appropriate (if remittance then do not need to fill in):
Allocation # (if multiple items on document number(s)):
Date to use in offset:
Any special notes regarding the offset:
Attachments: (should be remittance detail from customer):	 	

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_PaymentAllocationProcedure_L6.doc	

Manual Payment Allocation Procedure - Customer Facing Role, continued

Document Owner	 	It is the responsibility of the Payment Receipt & Handling (PR&H) Global Process & Technology Leader (GPTL) within the Customer Service Expertise Center to ensure this document is kept current and distributed to the appropriate personnel affected by these procedures.	 	
Document History	 	Below are at least the last three revisions of this document, including all revisions within the last three months. Approvals require that revisions to related documents were also made.	 	

Date	Revised By	Changes	  	Version Number	
09/28/10	Roxann DeBeau	Updated “Normal” SLA to reflect completed same day if received between 8-3	 	6	
09/03/09	Roxann DeBeau	Added NAA & Pacific area exceptions	 	5	
9/18/08	Susan Erndt	Added document owner and changed properties	 	4	
7/29/08	Susan Erndt	New format and added related documents.	 	3	
4/1/08	Susan Erndt	Split document by roles	 	2	
1/2/08	Susan Erndt	Created Document	 	1	

 
 	 	 	
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Sub-process of Payment Receipt & Handling	EMEA PRH SME/CISS	
Customer Service Work Process Documentation	Unallocated Cash Handling Procedure Styron	

Unallocated Cash Handling Procedure Styron

Introduction/Purpose	  	This document describes one of the Customer Service Work Processes, that when applied consistently provides predictable outputs and a reduction in process variability. Executing this process effectively will maximize value creation and enable employees to successfully execute the tasks required for daily operations.	 	
Scope	 	It often happens in the Money Collection Process that we receive payments which cannot be allocated to the correct customer accounts due to lack of information.
This process shows the steps to follow in those cases.	 	
Related Documents	 	 	 	

 

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Sub-process of Payment Receipt & Handling	EMEA PRH SME/CISS	
Customer Service Work Process Documentation	Unallocated Cash Handling Procedure Styron	

Unallocated Cash Handling Procedure Styron, continued

Process	  	The following describes the various steps required to execute this work process.	

Step	Responsibility	Procedure	 	
1	CISS	 Cash received into Styron Bank Accounts. MSC (Mumbai Service Center) cannot allocate to the correct customer account due to lack of transfer information.	 	
2	CISS	 AR MSC will send an e-mail for all Styron payments to Gabriele Racz and Daniel Pawlak for further investigations.	 	
3	RS/WPC	 Correct customer account and details will be provided to MSC.	 	
4	CISS	 Cash allocation team to allocate cash as per details received.	 	

 
 	 	 	
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Sub-process of Payment Receipt & Handling	EMEA PRH SME/CISS	
Customer Service Work Process Documentation	Unallocated Cash Handling Procedure Styron	

 	 	 	 	
Document Owner	  	It is the responsibility of the EMEA Payment Receipt & Handling SME with the Customer Service Expertise Center to ensure this document is kept current and distributed to the appropriate personnel affected by these procedures.	 	
Document History	 	Below are at least the last three revisions of this document, including all revisions within the last three months. Approvals require that revisions to related documents were also made.	 	

Date	Revised By	Changes	Version Number	
20.08.12	Paola Tonelli/ Angelique Roctus	Document Created	1	

 

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H _GL_CF_CreditLimit_ManageCreditBlockProcedure_L6.doc	

Credit Limit Credit Block Procedure – Customer Facing Role

Introduction	This document describes one of the Customer Service Work Processes, that when applied consistently provides predictable outputs and a reduction in process variability. Executing this process effectively will maximize value creation and enable employees to successfully execute the tasks required for daily operations.	
Scope	Procedure outlines how credit blocked orders will be resolved in order to provide the customer with on time delivery.	
Related Documents	Flow Chart:	
 	Manage Credit Blocked Orders	
 	RUSH Credit Block Orders	
 	Job Aids:	
 	ACE Tool User Guide	
 	Mass Maintenance Update - YFCC	
 	Creating an Autosignature in Outlook	
 	Reviewing Freight and Taxes - TA03	
 	Updating DTS - YDT2	
 	Location a Remit To - TS07	
 	ACE Color Coding Grid	
 	Area Specifics:	
 	Europe/IMEA	
 	North America	
 	Pacific	
Process	The following describes the various steps required to execute this work process. These steps are for the Customer Facing role.	

 

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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H _GL_CF_CreditLimit_ManageCreditBlockProcedure_L6.doc	

Credit Limit Credit Block Procedure – Customer Facing Role, continued

Step	  	Procedures	  	
1	 	Credit Limit
 Review email from credit department responding to credit limit issue on what actions are needed in order to get the order released. (The Specialized Leveraged team completing credit block activities sent them an email on your behalf).
 Review list of orders and shipment planning date.
o Shipment planning dates for current date you need to follow the RUSH process.
o Shipment planning dates 1-7 days out, follow the following steps.
 Be sure to call the customer and secure payment information. Provide details on why you are requesting payment information on invoices not due yet. If no response, get the customer's purchasing agent and field seller involved. Keep the Customer Facing CSR in the loop so they are aware if any issues appear. It is very critical to get payment information on the invoices and escalate as necessary to resolve the credit limit issue prior to the shipment planning date.
o All contacts to customers or internal key partners need to be logged into DTS and follow up dates added. As the shipment planning date gets closer to be within 3 days, work on issue daily until resolved. Refer to the job aid called, Updating DTS - YDT2.
o Update the shared notes on the ROCK via the ACE tool for key partners to be able to review the details of the actions already taken. Refer to the job aid called, "ACE User Guide" for further information as well as the ACE color coding grid for appropriate information.
 To update the shared notes, right click and select ROCK comment and then shared notes.
o Once payment information is secured, update payment information via Mass Maintenance. Refer to the job aid called, "Mass Maintenance Update - YFCC." Once payment Information is updated, the credit sufficiency matrix will work to release any pending orders if the payment information is sufficient to release orders. (The auto-release feature via the credit sufficiency matrix may not be   turned on for your area, please see area specifics for appropriate rules). If orders do not release, then contact CFS for further information. The Credit Sufficiency Matrix cycles every 15 minutes ~ wait approx. 30 min after Updating the matrix to see if orders release .	 	

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H _GL_CF_CreditLimit_ManageCreditBlockProcedure_L6.doc	

Credit Limit Credit Block Procedure – Customer Facing Role, continued
 
Step	  	Procedures	 	
2	 	 If resolution is not obtained by the shipment planning date (which can be found in the ACE tool), send email to the specialized leveraged team completing credit block activities to reassign the ROCK to the customer facing CSR as order has to be canceled or shipment date moved out. Be sure to copy the customer facing CSR on the email. Create an auto-signature (Refer to the job aid called, Creating an Autosignature") using the following information: Refer to your area exceptions for appropriate functional mailbox.
CSR (Enter their name) -
The order(s) listed have not been released. Please call the customer to advise that the shipment planning date needs to be moved out or the order should be canceled:
Attached is the history of the actions taken:
 Document all DOW contact information (i.e. who was called to assist - field seller or CFS)
 Customer Contacts - who at the customer was contacted
 Reason for the block
 Reason for the credit block
 Reason why customer did not provide payment information (i.e. only have payments scheduled on certain days of the month).	 	

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H _GL_CF_CreditLimit_ManageCreditBlockProcedure_L6.doc	

Credit Limit Credit Block Procedure – Customer Facing Role, continued

Step	  	Procedures	  	
3	 	Cash In Advance:
 You receive an email from the Specialized Leveraged Team completing Manage Credit Block activities regarding a Cash In Advance customer. The email details order(s) that will need to be addressed.
 Contact customer for pre-payment of order(s)
 To determine the amount the customer has to pay review the order via TA03.
 You need to check to see if the customer should be charged freight and taxes, if applicable, refer to area exceptions.   Refer to the job aid called, "Reviewing Freight and Taxes – TA03."
 Provide customer with correct payment instructions. Review your area specifics for the appropriate remit-to addresses.
 Follow up with Specialized Leveraged team completing Manage Credit Block activities (Refer to your area specifics for appropriate functional mailbox), to advise when customer is sending payment.
      Update the shared notes on the ROCK associated with the order to indicate action taken.	 	
4	 	 Contact customer if appropriate to follow-up for payment information. The Specialized Leveraged Team completing manage credit block activities will monitor the customer's account to find out whether or not the payment has been applied to the customer's account. If the payment has not been applied on the customer's account within 3 days for e-payment or 5 days for check payment, an email will be sent to the Customer Facing RS for followup.
 Once payment is received, forward the email received initially to the Specialized Leveraged Team completing Manage Credit Block activities via email, to close ROCK and to have them contact CFS to release order. (Refer to your area specifics for appropriate functional mailbox). Use the following canned text as a guideline:
SLT: (Insert their team name or the person you are sending it back to)
Please resolve ROCK(s) # XXXXX, XXXXX...The order(s) have been released from credit block and the ROCK(s) need to be resolved.
Thank you,
Your name	 	

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H _GL_CF_CreditLimit_ManageCreditBlockProcedure_L6.doc	

Credit Limit Credit Block Procedure – Customer Facing Role, continued
 
Document Owner	It is the responsibility of the Payment Receipt & Handling (PR&H) Global Process & Technology Leader (GPTL) within the Customer Service Expertise Center to ensure this document is kept current and distributed to the appropriate personnel affected by these procedures.	
Document History	Below are at least the last three revisions of this document, including all revisions within the last three months. Approvals require that revisions to related documents were also made.	

 	 	 	 	
Date	Revised By	Changes	Version Number	
09/28/10	Roxann DeBeau	Step 1: update "purchasing" with "customer's purchasing agent"	7	
09/02/09	Roxann DeBeau	Added Pacific Area Exception Link	6	
11/12/08	Susan Erndt	Revised step 1 to include to review area specifics if credit sufficiency matrix is not enabled in area.
Revised step 3 to include to review area specifics regarding remit to information.	5	
9/19/08	Susan Erndt	New format, updated document owner and SLT.	4	
8/6/08	Susan Erndt	New format	3	
4/2/08	Susan Erndt	Split document by role	2	
11/14/07	Susan Erndt	Created Document	1	

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_PastDue_ManageCreditBlockProcedure_L6.doc	

Managing Credit Block Procedure for Past Dues - Customer Facing Role
 
Introduction	  	This document describes one of the Customer Service Work Processes, that when applied consistently provides predictable outputs and a reduction in process variability. Executing this process effectively will maximize value creation and enable employees to successfully execute the tasks required for daily operations.	
Scope	 	Procedure outlines how credit blocked orders will be resolved in order to provide the customer with on time delivery. This procedure is followed by the Customer Facing Role.	
Related Documents	 	Flow Chart:	
 	 	Manage Credit Blocked Orders	
 	 	LAA PD Credit Blocked Orders	
 	 	Job Aids:	
 	 	Mass Maintenance - YFCC	
 	 	Updating DTS - YDT2	
 	 	ACE Color Coding Grid	
 	 	ACE Tool User Guide	
 	 	Area Specifics:	
 	 	EMEA	
 	 	Latin America	
 	 	North America	
 	 	Pacific	
Process	 	The following describes the various steps required to execute this work process. These steps are for the Customer Facing role.	

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_PastDue_ManageCreditBlockProcedure_L6.doc	

Managing Credit Block Procedure for Past Dues - Customer Facing Role, continued

Step	  	Procedures	  	
1	 	For items with a PD or P%:
 The Specialized Leveraged Team completing Manage Credit Block activities will be contacting the customer on behalf of the Customer Facing Role or the Customer Facing RS for payment information when invoices and/or discrepancies are blocking orders. (Refer to your area exceptions for appropriate details). They will use Siebel for the appropriate accounts payable contact. If the customer does not have an email address, the Customer Facing role will receive an email to contact the customer to resolve the credit block issue.
 Receive email in personal inbox regarding orders on hold due to past dues. The email will contain the documents currently on the customer's account that are blocking their orders.
 Review list of orders and review the shipment planning date. Refer to area exceptions for additional requirements.
 If the shipment planning date is current date, follow the RUSH process.
 Contact the customer and secure payment information on the items that are blocking the customer's account. A list of the items blocking the account will be received via email from the Specialized Leveraged Team completing Manage Credit Block activities. If a response is not received by the customer, get customer's purchasing agent and the field seller involved, refer to area exceptions. It is very critical to get payment information on the invoices and escalate as necessary to resolve the past due issue prior to the shipment planning date.	 	
2	 	 If the customer's payment information is obtained, update payment information in DTS. Refer to the job aid called, "Mass Maintenance Update – YFCC." If the credit sufficiency matrix logic is enabled in your area, wait 30 minutes before checking to see if the order has been released. If not, contact the Credit department for the account to advise what needs to be completed in order to get the order(s) released. If the Credit Sufficiency matrix is not enabled, contact the credit department immediately once payment information is updated in SAP for credit block resolution. Refer to your area specifics for appropriate information.
o All contacts to customers or internal key partners need to be logged into DTS and follow up dates added. As the shipment planning date approaches to within 3 days, work on issue daily until resolved. Refer to the job aid called, "Updating DTS - YDT2" for more details on how to update DTS.
o If necessary escalate (field seller, customer's purchasing agent and Customer Facing CSR); if no resolution is obtained, send email to the Specialized Leveraged Team completing Manage Credit Block activities to reassign the ROCK to the Customer Facing CSR. If the Customer Facing CSR has not been involved up to this point in discussions, be sure to send them an email that details the actions that were taken in order to get the credit block resolved. Refer to your area specifics for appropriate functional mailbox for the leveraged team.	 	
3	 	 Once credit has been resolved based on payment information recorded, the Specialized Leveraged team will resolve the ROCK via the ACE tool.	 	

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_PastDue_ManageCreditBlockProcedure_L6.doc	

Managing Credit Block Procedure for Past Dues - Customer Facing Role, continued
 
Step	  	Procedures	 	
4	 	 Receive email back from Credit Tech for the orders on credit block due to past dues, refer to area exceptions:
o Orders not released: contact the field seller or customer as appropriate as detailed in step 1 to get the orders released. If the orders will not be released and no resolution from the customer, email the Specialized Leveraged Team completing Manage Credit Block activities to re-assign the ROCK to the Customer Facing CSR to move the shipment out or cancel the order. Refer to your area exceptions for appropriate functional mailbox.
o If no resolution is obtained, in the email to the Specialized Leveraged Team completing Manage Credit Block activities ensure the following information has been given:
 Document all DOW contact information (i.e. who was called to assist – field seller or CFS)
 Customer Contacts - who at the customer was contacted
 Reason for the block
 Reason for the credit block
  Reason why customer did not provide payment Information (i.e. only have payments scheduled on certain days of the month).	 	

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_PastDue_ManageCreditBlockProcedure_L6.doc	

Managing Credit Block Procedure for Past Dues - Customer Facing Role, continued

Document Owner	It is the responsibility of the Payment Receipt & Handling (PR&H) Global Process & Technology Leader (GPTL) within the Customer Service Expertise Center to ensure this document is kept current and distributed to the appropriate personnel affected by these procedures.	
Document Control
Responsibility	It is the responsibility of the Customer Service Expertise Center to ensure the procedures are kept current and distributed to the appropriate personnel affected by these procedures.	

Date	Revised By	Changes	Version Number	
11/26/13	Abbie McGuire	Updated step 2 of NAA exceptions (wait 2 hrs after credit sufficiency matrix is updated to send release request)	9	
11/30/10	Roxann DeBeau	Add Latin Exceptions and requirements	8	
09/29/10	Roxann DeBeau	Updated Step 1 & 2 with "customer's purchasing agent" instead of "purchasing" for clarification.	7	
09/02/09	Roxann DeBeau	Added Pacific Area Exception Link	6	
11/12/08	Susan Erndt	Reworded step 2; bullet 1 to include to review area specifics in the case credit sufficiency matrix is not enabled.	5	
9/19/08	Susan rndt	New format, added document owner, changed names of teams	4	
8/7/08	Susan Erndt	New Format	3	
4/2/08	Susan Erndt	Split document by role	2	
11/14/07	Susan Erndt	Created Document	1	

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_ManageDiscrepancies_L6.doc	

Manage Discrepancies Procedure for Customer Facing Role

Introduction	  	This document describes one of the Customer Service Work Processes, that when applied consistently provides predictable outputs and a reduction in process variability. Executing this process effectively will maximize value creation and enable employees to successfully execute the tasks required for daily operations.	
Scops	 	Procedure that details how discrepancies are managed/resolved by the Customer Facing role.	

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_ManageDiscrepancies_L6.doc	

 	 	 	
Related Documents	  	Flow Chart:	
 	 	 	
 	 	Manage Discrepancies flow chart	
 	 	 	
 	 	Job Aids:	
 	 	 	
 	 	Creating a New Discrepancy Report - YDT1	
 	 	Reviewing DTS - YDT2	
 	 	Display Document History - TV81	
 	 	Reviewing Order Notes - TA03	
 	 	Determining if QM Exists - QM03	
 	 	Displaying QM - QM03	
 	 	Display RV Invoice - TA93	
 	 	Creating Price Inquiry - TA21	
 	 	Updating DTS - YDT2	
 	 	Identifying Account Contacts - Siebel	
 	 	Using ICAMP Script - QM01	
 	 	Entering a SAR - NAA	
 	 	Creating a Follow Up Discrepancy Report - YDT1	
 	 	View Requests - SAR	
 	 	Updating QM - QM02	
 	 	Approving a SAR	
 	 	Resolving a Manual ROCK - YRC2	
 	 	Creating an Uncoded Discrepancy Report - YDT1	
 	 	 	
 	 	Exceptions:	
 	 	North America	
 	 	Latin America	
 	 	Europe/IMEA	
 	 	Pacific	
 	 	 	
 	 	Procedures:	
 	 	Create Sales Adjustment Procedure for Customer Facing Role	

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_ManageDiscrepancies_L6.doc	

Manage Discrepancies Procedure for Customer Facing Role, continued

Process	   	The following describes the steps required to execute the procedure. This procedure is for the Customer Facing role.	  	

Step	  	Procedures	  	
1	 	 Retrieve initial list of discrepancies (items without follow- up dates). Exclude from YDT1 items coded: DB, GT, GF, GB, CA, G7, HF, SB, H2, KB, KS, KZ and Blank:
 Use RS match code S..XX, where XX is the RS Code.
 Posting keys should be 06 and 16
 Follow up date: less than equal to 01/01/01
These reason codes are excluded as the Specialized Leveraged Team (if implemented in your area) completing managing discrepancy activities will review them first prior to the Customer Facing role doing so. Once the Specialized Leveraged Team is finished, they will code the items DU and update DTS and Segment text with their investigation if they were unable to resolve the item. If they were able to resolve, then they will request the approval appropriately.
 A variant called “Discrepancy1” has been created to help with this process versus filling in the above information every time.
 Refer to the job aid called, “Creating a report of new discrepancies – YDT1” for further details.
 Sort list by customer name. If your list is lengthy, then do a variety of sorts while working on your list to ensure you work on all items. Suggested that you sort A-Z; Z-A, dollar value.
 Review DTS on the items for actions taken by Leveraged Team to determine the next action to be taken. Refer   to the job aid called, “Reviewing DTS Text – YDT2.”		

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_ManageDiscrepancies_L6.doc	

Manage Discrepancies Procedure for Customer Facing Role, continued

Step	  	Procedures	  	
2	 	 Research the discrepancy further to identify reason:
o Check TV81 for previous adjustments or pending returns. Refer to the job aid called, “Reviewing Document History – TV81” for further information.
o Check TA03 for order notes. Refer to the job aid called, “Reviewing Order notes – TA03.”
o Check the invoice via TA93 for any obvious deductions, i.e. freight, tax, rush order fees, etc). Refer to the job aid called, “Displaying RV Invoice – TA93.”
o To see if the discrepancy is for price, take the dollar amount of the discrepancy and divide it by the quantity. If the amount comes out to a round number, like $.01/lb or $.019999 (round to $.02), this means the customer deducted that much. If this did not calculate, proceed to the next bullet of this step in the investigation.
 Check TA21, to verify whether or not the price the customer paid is correct. Refer to the job aid called, “Create Price Inquiry–TA21” or use the TA21 script on the PR&H Quick pad, if available. If the customer paid correctly according to TA21, refer to the “Create Sales Adjustment Procedure for Customer Facing Role” for further information, otherwise go to step 3 to have the approvals requested.
o Check for quantity, by dividing the amount of the discrepancy by the base price. If comes out to an even quantity, i.e. 1000 lbs, then discrepancy may be for quantity.
o Check customer remittance in the case of cash discounts on the invoice to ensure the amount of discrepancy is accurate. Remember: if customer has discounted terms (i.e. 1% 10) the amount of the discrepancy will not match to SAP. SAP doesn’t recognize that the customer short or over paid and therefore will give the customer the amount of discount recorded on their invoice versus adjusting it for the amount short or over paid.
o Check YDT2 for any previous notes. Refer to the job aid, “Reviewing DTS notes – YDT2,” for further information.
o Check QM03 for any QM’s entered against the invoice. Refer to the job aid called, “Determining it QM Exists – QM03,” for further information. Refer to the job aid called “Displaying QM – QM03,” to find out more information on the QM. If a QM exists for the discrepancy, update the QM as appropriate. Refer to the job aid called, “Updating QM – QM02.”
o Check the customer’s remittance for any backup provided. Refer to your area specifics for appropriate remittance locations.
 If unable to determine reason based on research completed, contact the customer. Refer to your Siebel account contacts to determine the appropriate contact. Refer to the job aid called, “Identifying Account Contacts – Siebel.”		

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_ManageDiscrepancies_L6.doc	

Manage Discrepancies Procedure for Customer Facing Role, continued

Step	  	Procedures	  	
3	 	 Once reason has been identified:
o Optional: A discrepancy can be coded DB if price or GT if other than price, update DTS for the reason for the discrepancy and remove the follow up date and the Specialized Leveraged Team completing discrepancy activities will pick up the discrepancy to resolve. Refer to the job aid called, “Updating DTS – YDT2,” for further information on how to update DTS.
 If a QM is needed, enter QM:
o Refer to the job aid called, “Using ICAMP Script – QM01.”
o If QM already exists based on investigation in step 2, update the QM as necessary and update the discrepancy with the QM#. Refer to the job aid “Updating DTS – YDT2,” for more details on how to update DTS.
o On your discrepancy, please utilize a 3 business day follow up to assist response time.
 If QM is not needed:
o If approval is needed from business or utilizing your own DOA, enter a SAR. You can access the SAR tool via the Intranet or the scripting tool, by using the “SAR” tab. Refer to your area exceptions for which type of adjustments/business use SAR.
 Ensure you put the “RS” as the Specialized Leveraged team creating sales adjustments.
 Enter yourself as “informational” if you want to receive the SAR once it has been completed.
 Refer to the job aid, “Entering a SAR” for more details as well as the “Create Sales Adjustment Procedure for the Customer Facing Role.”
 Refer to the job aid called, “Approving a SAR” if using your own DOA to approve.
 If discrepancy needs to be cleared and reversed back to the customer:
o Send a request to Specialized leveraged team completing sales adjustments with the information for the reversal of the items. This information should be fitted out for each adjustment:
Liable #:
Invoice#
Company Code:
Item number(s) (if applicable):
Total adjustment amount:
Reason Code:
Sales Adjustment Document Type:
K-conditions/Amount or New Price
Payment Terms:
Currency
Special text requirements:
Document to be offset with: (provide allocation # if multiple lines on document):
Other:		

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_ManageDiscrepancies_L6.doc	

Manage Discrepancies Procedure for Customer Facing Role, continued

Step	  	Procedures	  	
4	 	 Update the document with the appropriate information via YDT2. Refer to the Job aid called, “Updating DTS-YDT2.”
 Be sure to set a follow-up date appropriately based on the reason for the discrepancy:
 Update the reason code with the appropriate code based on the root case of the discrepancy.
 If you enter a SAR, for the discrepancy, input a follow up date of 3 business days.
 Enter a QM? - set follow up date for 5 business days
 Contacted customer – set follow up date out 2 business days.		
5	 	 Retrieve “informational” SAR from personal inbox. This will indicate that the SAR has been concluded and a FYl for you to review.

 If customer is to receive a debit or credit back for their short or over payment, contact customer to advise them to payback their unauthorized short pay or deduct credit for incorrectly over paying. This is a proactive task in order to help in the collection process.		

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_ManageDiscrepancies_L6.doc	

Manage Discrepancies Procedure for Customer Facing Role, continued

Step	  	Procedures	  	
6	 	 Create a follow-up report to find those discrepancies that need follow-up to ensure the item does not age.
 Utilize transaction YDT1 to create the report. Refer to the job aid called, “Creating a Discrepancy Follow up report – YDT1,” for further details.
o Utilize posting keys 06 and 16.
o Enter a date range in the follow up date field that consists of 1/1/01 thru the current date.
 A variant has also been created to help with this process versus filling in the above information every time. Variant name is “Discrepancy2” and the RS match code needs to be modified.
 Once report is shown, sort by follow up date to ensure all old items are worked on first in order to have current follow up dates on items.
 If applicable for your area, sort by items coded DU as well as these items are what the Specialized Leveraged team completing discrepancy activities were unable to research and therefore, these are “uncoded” discrepancies and need action taken on them in order to code them appropriately.
 Review previous actions taken on discrepancies. Refer to the job aid called, “Reviewing DTS Text – YDT2” for details on how to review any previous actions.
 If customer was contacted for reason for discrepancy, no response, contact the customer using another form or contact method (i.e. if email was used initially, call the customer the second time). If no response from the customer after many attempts, ask the field seller for assistance in finding out the reason for the discrepancy.
 Remember to update DTS with all the actions taken and with the appropriate follow up dates and reason code to ensure appropriate follow up is taken place. Refer to the job aid, “Updating DTS – YDT2.”		

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_ManageDiscrepancies_L6.doc	

Manage Discrepancies Procedure for Customer Facing Role, continued

Step	  	Procedures	  	
6, cont	 	 Follow up on any open SARs (i.e. if the approver has not approved the adjustment, either call or send them a reminder to approve the SAR). Refer to the job aid called, “View Requests – SAR,” in order to find open SARs.
 Follow up on any open QMs. If no action was taken in the QM in a few days, be sure to log a request in the QM for an update or call the person who needs to take action to ask them to complete the QM. Refer to the job aid called, “Updating QM – QM02.”
 Be sure to set appropriate follow-up dates after reviewing and taking any actions. DO NOT move the follow up date without taking action and logging your actions into DTS.		
7	 	For discrepancies that have not been appropriately coded (refer to area exceptions) and are more than 15 days from the posting date, the Specialized Leveraged Team completing credit block activities will be sending a ROCK or email to the Customer Facing Role to resolve.
 Receive ROCK for uncoded discrepancy.
 Investigate discrepancy to find root cause of the discrepancy.
 Take action to resolve the discrepancy
 Code the discrepancy. Refer to the job aid called. “Updating DTS-YDT2,” to complete the update actions.
 Resolve the ROCK by either using the “Resolve” button in the ACE tool or manually resolving the ROCK. Refer to the job aid called, “Resolving Manual ROCK – YRC2.”
 ROCK has now been resolved.	 	
8	 	 Create a list of uncoded discrepancies to ensure the items are coded appropriately.
 Discrepancies may appear uncoded when manual application is completed or reinstated documents.
 Refer to the job aid called, “Uncoded Discrepancy Report – YDT1,” to create a list on your RS code.
 This should be completed bi-weekly to ensure accurate accounts.
 Refer to the Discrepancy Reason codes for appropriate discrepancy codes to apply to discrepancies.		
9	 	 If at any time during the research of discrepancies, it is identified that a reinstatement is required, please follow the steps below.
 If a reinstatement is required, please refer to area exceptions for instructions on how to proceed.
 If CISS completed the offset incorrectly (not Autocash) send an email to their functional mailbox to reinstate the items. Refer to area exception for appropriate functional mailbox.		

 
 	 	 	
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Payment Receipt & Handling	Customer Service Expertise Center	
Customer Service Work Process Documentation	PR&H_GL_CF_ManageDiscrepancies_L6.doc	

Manage Discrepancies Procedure for Customer Facing Role, continued
 
Document Owner	   	It is the responsibility of the Payment Receipt & Handling (PR&H) Global Process & Technology Leader (GPTL) within the Customer Service Expertise Center to ensure this document is kept current and distributed to the appropriate personnel affected by these procedures.	  	
Document History	 	Below are at least the last three revisions of this document, including all revisions within the last three months. Approvals require that revisions to related documents were also made.	 	

Date	Revised By	Changes	Version Number	
04/15/11	Roxann DeBeau	Updated Step 9 - reinstatement instructions (removed funct. Mailboxes from area exceptions as they won’t be doing reinstatements)	8	
09/29/10	Roxann DeBeau	Add Step 9 - Reinstatement instructions	7	
06/25/09	Roxann DeBeau	Specified Area Exceptions due to MET	6	
01/29/09	Roxann DeBeau	Updated document to add GA reason code to 680 Rock	5	
1/3/09	Susan Erndt	Updated document with reversals (flips).	4	
10/7/08	Susan Erndt	Updated format, added related documents, added document owner.	3	
4/1/08	Susan Erndt	Split document by role	2	
11/19/07	Susan Erndt	Created Document	1	

 

 
 	 	 	
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EXECUTION PAGE
IN WITNESS of which this Deed has been executed and delivered as a deed by the parties to it on the date above mentioned.

A  Swiss Seller and a Swiss Servicer	 	 	
 	 	 	
SIGNED and	 	 	
DELIVERED as a DEED by	 	 	
TRINSEO HOLDING S.À R.L.	 	 	
on behalf of TRINSEO   EUROPE GMBH	 	 	
 	 	 	
by Barry J. Niziolek, Manager	 	/s/Barry J. Niziolek	
 	 	 	
being a person who, in accordance with the laws of that territory, is acting under the authority of the company	 	 	

 

 

A Swiss Seller and a Swiss Servicer	 	 	
 	 	 	
SIGNED and	 	 	
DELIVERED as a DEED by	 	 	
TRINSEO HOLDING S.À R.L.	 	 	
on behalf of TRINSEO   EXPORT GMBH	 	 	
 	 	 	
by Barry J. Niziolek, Manager	 	/s/Barry J. Niziolek	
 	 	 	
being a person who, in accordance with the laws of that territory, is acting under the authority of the company	 	 	

[Master Amendment Deed Signature Page]

 

The German Seller and the German Servicer	 	 	
 	 	 	
SIGNED and	 	 	
DELIVERED as a DEED by	 	 	
TRINSEO HOLDING S.À R.L.	 	 	
on behalf of TRINSEO   DEUTSCHLAND	 	 	
ANLAGENGESELLSCHAFT MBH	 	 	
 	 	 	
by Barry J. Niziolek, Manager	 	/s/Barry J. Niziolek	
 	 	 	
being a person who, in accordance with the laws of that territory, is acting under the authority of the company	 	 	

[Master Amendment Deed Signature Page]

 

 	 	 	
The Dutch Seller and the Dutch Servicer	 	 	
 	 	 	
SIGNED and	 	 	
DELIVERED as a DEED by	 	 	
TRINSEO HOLDING S.À R.L.	 	 	
on behalf of TRINSEO   NETHERLANDS B.V.	 	 	
 	 	 	
by Barry J. Niziolek, Manager	 	/s/Barry J. Niziolek	
 	 	 	
being a person who, in accordance with the laws of that territory, is acting under the authority of the company	 	 	

[Master Amendment Deed Signature Page]

 

 	 	 	
The U.S. Seller and the U.S. Servicer	 	 	
 	 	 	
SIGNED and	 	 	
DELIVERED as a DEED by	 	 	
TRINSEO HOLDING S.À R.L.	 	 	
on behalf of TRINSEO LLC	 	 	
 	 	 	
by Barry J. Niziolek, Manager	 	/s/Barry J. Niziolek	
 	 	 	
being a person who, in accordance with the laws of that territory, is acting under the authority of the company	 	 	

[Master Amendment Deed Signature Page]

 

 	 	 	
The U.S. Intermediate Transferor	 	 	
 	 	 	
SIGNED and	 	 	
DELIVERED as a DEED by	 	 	
TRINSEO U.S. RECEIVABLES	 	 	
COMPANY SPV LLC	 	 	
 	 	 	
by Angelo N. Chaclas,	 	/s/Angelo N. Chaclas	
Senior Vice President, Chief Legal Officer and Corporate Secretary	 	 	
 	 	 	
being a person who, in accordance with the laws of that territory, is acting under the authority of the company	 	 	

[Master Amendment Deed Signature Page]

 

 	 	 	
The Master Purchaser and the Chargee	 	 	
 	 	 	
SIGNED   and	 	 	
DELIVERED as a DEED for and on behalf	 	 	
of STYRON RECEIVABLES FUNDING	 	 	
DESIGNATED ACTIVITY COMPANY	 	 	
 	 	 	
acting by its duly authorised	 	 	
Attorney	 	 	
in the presence of:	 	/s/Sam Sengupta	
 	 	Sam Sengupta	
 	 	Attorney	

/s/[illegible]	 	 	
(Witness’ signature)	 	 	
3 rd Floor, Kilmore House,	 	 	
Park Lane, Spencer Dock,	 	 	
Dublin 1	 	 	
(Witness’ address)	 	 	
Legal & Compliance Manager	 	 	
(Witness’ occupation)	 	 	
 
]

[Master Amendment Deed Signature Page]

 

 	 	 	
The Investment Manager and the Styron Noteholder	
 	 	 	
SIGNED and DELIVERED	 	 	
as a DEED by TRINSEO HOLDING S.À R.L.	 	 	
for and on behalf	 	 	
of TRINSEO FINANCE	 	 	
LUXEMBOURG S.À R.L., LUXEMBOURG,	 	 	
ZWEIGNIEDERLASSUNG HORGEN	 	 	
 	 	 	
acting by its duly authorised representative:	 	 	
 	 	 	
Barry J. Niziolek, Manager	 	/s/Barry J. Niziolek	

[Master Amendment Deed Signature Page]

 

 	 	 	
The Regency Noteholder	 	 	
 	 	 	
GIVEN under the common seal of	 	 	
REGENCY ASSETS DESIGNATED ACTIVITY COMPANY	 	 	
in the presence of:	 	 	

/s/Bronagh Hardiman	 	 	
Director	 	 	

/s/[illegible]	 	 	
Director/Secretary	 	 	

[Master Amendment Deed Signature Page]

 

 	 	 	
The Cash Manager and the Master Purchaser Account Bank	 	 	
 	 	 	
SIGNED and DELIVERED	 	 	
as a DEED by for and on behalf	 	/s/Rebecca Andrew	
of HSBC BANK PLC	 	Rebecca Andrew	
acting by its duly authorised Attorney:	 	Associate Director	

 	 	
In the presence of	/s/James York	
Name:	 	
Profession:	BANKER	
Address:	James York	
 	Associate	
 	 	
 	8 Canada Square	
 	London	
 	E14 5HQ	

[Master Amendment Deed Signature Page]

 

The Parent and Guarantor	 	 	
 	 	 	
SIGNED and DELIVERED	 	 	
as a DEED by for and on behalf	 	 	
of TRINSEO HOLDING S.À R.L.	 	 	
acting by its duly authorised representative:	 	 	
 	 	 	
Barry J. Niziolek, Manager	 	/s/Barry J. Niziolek	

[Master Amendment Deed Signature Page]

 

 	 	 	 	
The Corporate Administrator and Registrar	 	 	
 	 	 	
PRESENT when the COMMON SEAL of	 	 	
TMF ADMINISTRATION SERVICES	 	 	
LIMITED was AFFIXED HERETO by:	 	 	
 	 	 	
Director:	 	/s/Kevin Butler	
 	 	Kevin Butler	
 	 	Director	
 	 	 	
Director/Secretary:	 	/s/John Hackett	
 	 	John Hackett	
 	 	Director	

[Master Amendment Deed Signature Page]

 

 	 	 	 	
The Styron Security Trustee	 	 	
 	 	 	
SIGNED as a DEED by	 	 	
 	 	 	
Director:	/s/[illegible]	 	 	
 	 	 	 	
Director /Secretary:	/s/[illegible]	 	 	
 	 	 	
For and on behalf of THE LAW	 	 	
DEBENTURE	 	 	
TRUST CORPORATION P.L.C.	 	 	

[Master Amendment Deed Signature Page]

 
Exhibit 10.27

 

	    	TRINSEO S.A.
46A avenue John F. Kennedy
L-1855 Luxembourg
Grand Duchy of Luxembourg	

 
[Date]

[Director Nominee Name]
[Address]
 
Dear [Director Nominee Name],
 
The Nominating and Corporate Governance Committee (the "NCGC") of Trinseo S.A. (the “Company” or “Trinseo”) is pleased to proffer you as a candidate to join the Board of Directors (the “Board”) of the Company at the next available vacancy on the Board.  Your appointment would take effect at a mutually agreeable date following the necessary approvals from the Board.  This Letter Agreement outlines the terms of your potential appointment to the Board.
 
In connection with your appointment as a member of the Board, you will be entitled to:
 
	·		An annual Cash Retainer fee of $90,000, which will be paid quarterly.	
 
	·		An annual Equity Retainer, payable in the form of restricted stock units (“RSU’s”) equivalent to $120,000 in value which will fully vest on the first anniversary of each respective grant date, subject to your continued service as a member of the Board.  The first grant of RSUs will be awarded following your appointment to the Board. You will receive subsequent grants annually at the time of the Company's annual meeting of shareholders.	
 
The Company will reimburse you for all reasonable travel expenses that you incur in connection with your attendance at meetings of the Board, in accordance with the Company’s expense reimbursement policy as in effect from time to time.
 
As a member of the Board, the following apply to you:
 
	·		You will receive indemnification as set forth in the Company’s articles of association.	
 
	·		Prior to and after your appointment, you are required to notify the Company’s Legal Department of any potential or actual conflicts of interest that may arise with respect to the Company.	
 
	·		You will be subject to Trinseo’s share ownership guidelines for members of the Board and for key employees, which stipulate that you are expected to own five (5) times your annual cash retainer in Trinseo stock within five (5) years from the date you become a Board member.	

 
Page 2

We hope that you are interested in this potential opportunity to join the Company’s Board of Directors and to serve on various committees.  Please note that the Board's committee structure is overseen by the NCGC and subject to Board approval.  If you join the Board, the NCGC will review with you potential committee assignments.
 
Please indicate your agreement with these terms and accept this conditional offer by signing, dating and returning this letter to Marilyn Horner, SVP Human Resources.

 	 	 	
Yours very truly,	    	 	

 	 	 	
[Director and Chairman of NCGC]	 	 	
 	 	 	
Cc:  [Names of NCGC Members]	 	 	

 	 	 	
 
I have read, understand and accept this conditional offer to join the Trinseo S.A. Board of Directors:

 	 	 	

[Director Nominee Name]	 	Date	

Exhibit 10.9
 
AMENDMENT NO. 2 TO EMPLOYMENT AGREEMENT

THIS AMENDMENT NO 2 TO EMPLOYMENT AGREEMENT (this “Amendment ”) is made and entered into as of December 20, 2017, by and among Trinseo US Holding, Inc. (formerly, Styron US Holding, Inc.), a Delaware corporation (the “ Company ”), Trinseo S.A., a public limited liability company ( société anonyme ) organized under the laws of the Grand Duchy of Luxembourg (“ Parent ”), and Marilyn Horner (the “ Executive ”).
 
W I T N E S S E T H
----------------------------------
 
WHEREAS, the Company, Parent and the Executive entered into an Employment Agreement (the “ Agreement ”) dated as of January 5, 2011 and as amended on February 14, 2012.
 
WHEREAS, the Executive has expressed an interest in retiring from the Company;
 
WHEREAS, the Company desires to continue the employment of the Executive as the Senior Vice President of Human Resources of the Company for a period of time and then in a different capacity to support and a provide an overlapping transition with a replacement Vice President/Senior Vice President of Human Resources for an additional period of time;
 
WHEREAS, the Executive wishes to assist with such orderly transition; and
 
WHEREAS , the Company, Parent and the Executive desire to amend certain terms and conditions of the Agreement as set forth herein.
 
NOW, THEREFORE , in consideration of the foregoing, of the mutual promises contained herein and of other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:
 
1.         AMENDMENTS.
 
A.        Notwithstanding anything in Section 1(a) of the Agreement to the contrary, the Executive’s primary place of employment with the Company shall be in the Pittsburgh, Pennsylvania area, provided that the Company agrees that the Executive’s duties may occasionally be performed by the Executive at one of the Executive’s principal residences where the Executive owns a home (collectively the “Executive’s Residences”) ,   provided further that the Executive understands and agrees that the Executive will be required to travel frequently for business purposes.
 
B.        Section 2 of the Agreement is hereby amended and restated to read in full as follows:
 
2.             EMPLOYMENT TERM. The Company agrees to employ the Executive pursuant to the terms of this Agreement, and the Executive agrees to be so employed until June 30, 2018

 

(the “ Initial Term ”) commencing upon the Effective Date. Following the Initial Term, the term of this Agreement may be extended by the parties for a mutually agreeable period. Notwithstanding the foregoing, the Executive’s employment hereunder may be earlier terminated in accordance with Section 7 hereof, subject to Section 8 hereof. The period of time between the Effective Date and the termination of the Executive’s employment hereunder shall be referred to herein as the “ Employment Term .”
 
C.         The following sentences shall be added to the end of Section 6(c) of the Agreement:
 
For the sake of clarity, the Executive shall be reimbursed for all reasonable out-of-pocket business expenses associated with travel from and to the Executive’s Residences. However, the Executive shall not be reimbursed for hotel and meal expenses incurred by the Executive for the performance of the Executive’s duties at the Company’s offices in Berwyn, Pennsylvania.
 
D.         Section 7(e) of the Agreement is hereby amended and restated to read in full as follows:
 
(e)      GOOD REASON. Upon written notice by the Executive to the Company of a termination for Good Reason. “ Good Reason ” shall mean the occurrence of any of the following events, without the express written consent of the Executive, unless such events are fully corrected in all material respects by the Company or Parent (as applicable) within thirty (30) days following written notification by the Executive to the Company of the occurrence of one of the reasons set forth below: (i) prior to April 1, 2018, the material diminution in the Executive’s position, duties or authorities or assignment of duties materially inconsistent with the Executive’s position, including the Executive being required to report to someone other than the Company’s Chief Executive Officer, (ii) the Executive’s relocation of the Executive’s primary work location outside of the Philadelphia, Pennsylvania metropolitan area or the Executive’s Residences; (iii) a reduction in Base Salary or Target Bonus; or (iv) the Company’s material breach of this Agreement. The Executive shall provide the Company with a written notice detailing the specific circumstances alleged to constitute Good Reason within ninety (90) days the occurrence of such circumstances, and actually terminate employment within thirty (30) days following the expiration of the Company’s thirty (30)-day correction period described above. Otherwise, any claim of such circumstances as “Good Reason” shall be deemed irrevocably waived by the Executive
 
E.           Section 7(g) of the Agreement is hereby amended and restated to read in full as follows:

2

 

(g)      EXPIRATION OF EMPLOYMENT TERM. Upon the expiration of the Employment Term pursuant to Section 2 hereof. For the sake of clarity, such expiration shall occur by the terms of this Agreement (unless sooner terminated) and neither party is required to give notice with respect to such expiration.
 
2.           NOTICE ADDRESS CHANGE. Pursuant to Section 15 of the Agreement, Company hereby provides notice of change of address as follows:
 
If to the Company:
 
1000 Chesterbrook Boulevard
Suite 300
Berwyn, Pennsylvania 19312
 
Attention:       Sr. Vice President & Chief Legal Officer
With a copy (which shall not constitute notice hereunder) to:
 
1000 Chesterbrook Boulevard
Suite 300
Berwyn, Pennsylvania 19312
 
Attention:       Chief Executive Officer
 
3.           AFFIRMATION. This Amendment is to be read and construed with the Agreement as constituting one and the same agreement. Except as specifically modified by this Amendment, all remaining provisions, terms and conditions of the Agreement shall remain in full force and effect.
 
4.           DEFINED TERMS. All terms not herein defined shall have the meanings ascribed to them in the Agreement.
 
5.           COUNTERPARTS. This Amendment may be executed in one or more counterparts, each of which shall be deemed to be an original but all of which together shall constitute one and the same instrument.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

3

 

SIGNATURE PAGE TO
AMENDMENT NO. 2 TO EMPLOYMENT AGREEMENT
 
IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the date first written above.
 
 	TRINSEO US HOLDING, INC.	
 	 	
 	 	By:	/s/ Angelo N Chaclas	
 	 	 	Name: ANGELO N CHACLAS	
 	 	 	Title:   SR. VICE PRESIDENT, CHIEF LEGAL OFFICER AND CORPORATE SECRETARY	

 	TRINSEO S.A.	
 	 	
 	 	By:	/s/ Stephen Zide	
 	 	 	Name: STEPHEN ZIDE	
 	 	 	Title:   BOARD CHAIR	

 	EXECUTIVE	
 	 	
 	 	By:	/s/ Marilyn Horner	
 	 	 	Marilyn Horner	

 

4

Exhibit 12.1
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES

 	 	Year Ended	
 	 	December 31,	
(in millions, except for ratio)	 	2017	 	2016	 	2015	 	2014	 	2013	
Earnings:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Income (loss) before income taxes	 	$	
411.1	 	$	
405.3	 	$	203.9 	 	$	
(47.6)	 	$	
(0.4)	
Adjustment for companies accounted for by the equity method	 	 	
5.3	 	 	
(14.7)	 	 	
(15.2)	 	 	
(11.8)	 	 	
(15.6)	
Less: Capitalized interest	 	 	
(5.0)	 	 	
(3.4)	 	 	
(3.9)	 	 	
(4.2)	 	 	
(3.1)	
Add: Amortization of capitalized interest	 	 	
2.5	 	 	2.1	 	 	
1.5	 	 	
1.3	 	 	
1.0	
 	 	 	
413.9	 	 	
389.3	 	 	
186.3	 	 	
(62.3)	 	 	
(18.1)	
Fixed Charges:	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Interest and debt expense	 	 	
73.0	 	 	
76.9	 	 	
94.2	 	 	
125.6	 	 	
132.6	
Capitalized interest	 	 	
5.0	 	 	
3.4	 	 	
3.9	 	 	
4.2	 	 	
3.1	
Rental expense representative of interest factor	 	 	
1.3	 	 	
1.4	 	 	
1.7	 	 	
1.5	 	 	
1.5	
 	 	 	
79.3	 	 	
81.7	 	 	
99.8	 	 	
131.3	 	 	
137.2	
Total adjusted earnings available for payment of fixed charges	 	$	
493.2	 	$	
471.0	 	$	
286.1	 	$	
69.0	 	$	
119.1	
Ratio of Earnings to Fixed Charges	 	 	
6.2	 	 	
5.8	 	 	
2.9	 	 	(a) 	 	 	(a) 	

	(a)		Due to net losses in the years ended December 31, 2014 and 2013, the ratio of earnings to fixed charges was less than 1. Our earnings were insufficient to cover fixed charges requirements by $62.3 million and $18.1 million for the years ended December 31, 2014 and 2013, respectively.	

 
Exhibit 21.1
SUBSIDIARIES OF TRINSEO S.A.
AS OF FEBRUARY 15, 2018

ENTITY NAME	    	JURISDICTION	 	
Trinseo Luxco S.à r.l.	  	Luxembourg	 	
Trinseo Holding S.à r.l.	  	Luxembourg	 	
Trinseo Materials S.à r.l.	  	Luxembourg	 	
Trinseo Materials Operating S.C.A.	  	Luxembourg	 	
Trinseo Finance Luxembourg S.à r.l.	  	Luxembourg	 	
Trinseo Belgium BVBA	  	Belgium	 	
Trinseo Suomi Oy	  	Finland	 	
Trinseo France S.A.S.	  	France	 	
Trinseo Deutschland GmbH	  	Germany	 	
Trinseo Deutschland Anlagengesellschaft mbH	  	Germany	 	
Styron Hellas M.EPE	  	Greece	 	
Trinseo Finance Ireland Unlimited Company	  	Ireland	 	
API Holding S.R.L.	 	Italy	 	
A.P.I. Applicazioni Plastiche Industriali S.p.A.	 	Italy	 	
Trinseo Italia S.R.L.	  	Italy	 	
Trinseo Holding B.V.	  	The Netherlands	 	
Trinseo Netherlands B.V.	  	The Netherlands	 	
Trinseo Spain, S.L.	  	Spain	 	
Trinseo Sverige AB	  	Sweden	 	
Trinseo Europe GmbH	  	Switzerland	 	
Trinseo Export GmbH	  	Switzerland	 	
Trinseo Kimya Ticaret Limited Şirketi	  	Turkey	 	
Trinseo UK Limited	  	United Kingdom	 	
Trinseo Petrochemicals (Zhangjiagang) Company Limited	  	China	 	
Trinseo Polymers (Zhangjiagang) Company Limited	  	China	 	
Trinseo (Hong Kong) Limited	  	Hong Kong	 	
Trinseo Materials (Hong Kong) Limited	 	Hong Kong	 	
Trinseo India Trading Private Limited	  	India	 	
PT Trinseo Materials Indonesia	  	Indonesia	 	
Trinseo Japan Y.K.	  	Japan	 	
Trinseo Korea Ltd.	  	Korea	 	
Trinseo Holdings Asia Pte. Ltd.	  	Singapore	 	
Trinseo Singapore Pte. Ltd.	  	Singapore	 	
Taiwan Trinseo Limited	  	Taiwan	 	
Trinseo Canada ULC	  	Canada – Nova Scotia	 	
Trinseo de México S. de R.L. de C.V.	  	Mexico	 	
Trinseo Services de México, S. de R.L. de C.V.	  	Mexico	 	
Trinseo Materials Finance, Inc.	  	United States – Delaware	 	
Trinseo U.S. Holding, Inc.	  	United States – Delaware	 	
Trinseo LLC	  	United States – Delaware	 	
Trinseo U.S. Receivables Company SPV LLC	 	United States – Delaware	 	
Americas Styrenics LLC 1	  	United States – Delaware	 	

1 Represents a joint venture company of which the registrant indirectly owns 50% of the voting equity.

Exhibit 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We hereby consent to the incorporation by reference in the Registration Statement on Form S-8 (No. 333-196973) of Trinseo S.A. of our report   dated March 1, 2018 relating to the financial statements, financial statement schedule, and the effectiveness of internal control over financial reporting, which appears in this Form 10‑K.
/s/ PricewaterhouseCoopers LLP
Philadelphia, Pennsylvania
March 1, 2018

Exhibit 23.2
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We consent to the incorporation by reference in Registration Statement No. 333-196973 of Trinseo S.A. on Form S-8 of our report dated February 14, 2018, relating to the consolidated financial statements of Americas Styrenics LLC and its subsidiaries as of December 31, 2017 and 2016 and for each of the three years in the period ended December 31, 2017, appearing in this Annual Report on Form 10-K of Trinseo S.A. for the year ended December 31, 2017.
/s/ DELOITTE & TOUCHE LLP
Houston, Texas
March 1, 2018

Exhibit 31.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER
I, Christopher D. Pappas, certify that:
	1.		I have reviewed this annual report on Form 10-K of Trinseo S.A.;	
	2.		Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;	
	3.		Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;	
	4.		The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:	
	(a)		Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;	
	(b)		Designed such internal controls over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;	
	(c)		Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and	
	(d)		Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and	
	5.		The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):	
	(a)		All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and	
	(b)		Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.	
Date: March 1, 2018

 	By:	/s/ Christopher D. Pappas	
 	Name:	Christopher D. Pappas	
 	Title:	Chief Executive Officer	

Exhibit 31.2
CERTIFICATION OF CHIEF FINANCIAL OFFICER
I, Barry J. Niziolek , certify that:
	1.		I have reviewed this annual report on Form 10-K of Trinseo S.A.;	
	2.		Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;	
	3.		Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;	
	4.		The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:	
	(a)		Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;	
	(b)		Designed such internal controls over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;	
	(c)		Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and	
	(d)		Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and	
	5.		The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):	
	(a)		All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and	
	(b)		Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.	
Date: March 1, 2018

 	By:	/s/ Barry J. Niziolek	
 	Name:	Barry J. Niziolek	
 	Title:	Chief Financial Officer	

Exhibit 32.1
Certification of CEO Pursuant to 18 U.S.C. Section 1350,
As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
In connection with the annual report of Trinseo S.A. (the “Company”) on Form 10-K for the period ended December 31, 2017 (the “Report”), as filed with the Securities and Exchange Commission on the date hereof, I, the undersigned, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, to the best of my knowledge, that:
	(1)		The Report fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934; and	
	(2)		The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.	
Date: March 1, 2018

 	By:	/s/ Christopher D. Pappas	
 	Name:	Christopher D. Pappas	
 	Title:	Chief Executive Officer	

Exhibit 32.2
Certification of CFO Pursuant to 18 U.S.C. Section 1350,
As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
In connection with the annual report of Trinseo S.A. (the “Company”) on Form 10-K for the period ended December 31, 2017 (the “Report”), as filed with the Securities and Exchange Commission on the date hereof, I, the undersigned, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, to the best of my knowledge, that:
	(1)		The Report fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934; and	
	(2)		The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.	
Date: March 1, 2018

 	By:	/s/ Barry J. Niziolek	
 	Name:	Barry J. Niziolek	
 	Title:	Chief Financial Officer