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Business Address123 ROBERT S. KERRAVENUEOKLAHOMA CITY OK 73102405-775-5000

Mailing Address123 ROBERT S. KERRAVENUEOKLAHOMA CITY OK 73102

SECURITIES AND EXCHANGE COMMISSION

FORM S-1/AGeneral form of registration statement for all companies including face-amount certificate

companies [amend]

Filing Date: 2005-11-18SEC Accession No. 0001047469-05-027190

(HTML Version on secdatabase.com)

FILERTRONOX INCCIK:1328910| IRS No.: 202868245 | State of Incorp.:DE | Fiscal Year End: 1231Type: S-1/A | Act: 33 | File No.: 333-125574 | Film No.: 051213893SIC: 2810 Industrial inorganic chemicals

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Use these links to rapidly review the documentTABLE OF CONTENTSINDEX TO COMBINED FINANCIAL STATEMENTS

As filed with the Securities and Exchange Commission on November 18, 2005

Registration No. 333-125574

SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

Amendment No. 5to

FORM S-1REGISTRATION STATEMENT

UNDERTHE SECURITIES ACT OF 1933

TRONOX INCORPORATED(Exact Name of Registrant as Specified in its Charter)

Delaware 2810 20-2868245(State or Other Jurisdiction ofIncorporation or Organization)

(Primary Standard IndustrialClassification Code Number)

(I.R.S. EmployerIdentification Number)

123 Robert S. Kerr Avenue, Oklahoma City, Oklahoma 73102(405) 270-1313

(Address, Including Zip Code, and Telephone Number,Including Area Code, of Registrant's Principal Executive Offices)

Roger G. Addison, Esq.Vice President, General Counsel and Secretary

Tronox Incorporated123 Robert S. Kerr Avenue

Oklahoma City, Oklahoma 73102(405) 270-1313

(Name, Address, Including Zip Code, and Telephone Number,Including Area Code, of Agent For Service)

Copy To:



David B.H. Martin, Esq.Covington & Burling

1201 Pennsylvania Avenue, N.W.Washington, D.C. 20004

(202) 662-6000

J. Michael Chambers, Esq.Akin Gump Strauss Hauer & Feld LLP

1111 Louisiana Street, 44th FloorHouston, Texas 77002

(713) 220-5800

Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of thisRegistration Statement.

If the securities being registered on this form are being offered on a delayed or continuous basis pursuant to Rule 415 under the SecuritiesAct of 1933, check the following box. o

If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the followingbox and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list theSecurities Act registration statement number of the earlier effective registration statement for the same offering. o

If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list theSecurities Act registration statement number of the earlier effective registration statement for the same offering. o

If delivery of the prospectus is expected to be made pursuant to Rule 434 under the Securities Act, please check the following box. o

The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective dateuntil the registrant shall file a further amendment which specifically states that this registration statement shall thereafter becomeeffective in accordance with Section 8(a) of the Securities Act of 1933, or until this registration statement shall become effective onsuch date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.



The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filedwith the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and is not soliciting offers tobuy these securities in any state where the offer or sale is not permitted.

Subject to Completion, dated November 18, 2005

PROSPECTUS

17,480,000 Shares

Class A Common Stock

We are offering 17,480,000 shares of our Class A common stock in this initial public offering. No public market currently exists for ourClass A common stock.

This offering of our Class A common stock is conditioned upon the completion of a concurrent joint private offering by Tronox WorldwideLLC and Tronox Finance Corp. (which will be our wholly-owned subsidiaries at closing) of unsecured senior notes, and the concurrent entryby Tronox Worldwide LLC into a senior secured credit facility.

Our Class A common stock has been approved for listing on the New York Stock Exchange under the symbol "TRX," subject to officialnotice of issuance. We anticipate that the initial public offering price will be between $18.50 and $20.50 per share.

Investing in our Class A common stock involves risks.See "Risk Factors" beginning on page 16.

Per

ShareTotal

Public offering price $ $Underwriting discount $ $Proceeds to Tronox Incorporated (before expenses) $ $

We have granted the underwriters a 30-day option to purchase up to an additional 2,622,000 shares of Class A common stock from us on thesame terms and conditions as set forth above if the underwriters sell more than 17,480,000 shares of our Class A common stock in thisoffering.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities ordetermined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

The underwriters expect to deliver the shares on or about , 2005.

LEHMAN BROTHERS JPMORGAN



CITIGROUP CREDIT SUISSE FIRST BOSTON

ABN AMRO INCORPORATED FRIEDMAN BILLINGS RAMSEY

SCOTIA CAPITALSG CORPORATE & INVESTMENT

BANKINGSUNTRUST ROBINSON HUMPHREY

, 2005



TABLE OF CONTENTS

Prospectus SummaryRisk Factors

Risks Related to Our Business and IndustryRisks Related to Our Relationship with Kerr-McGeeRisks Related to This Offering

Special Note Regarding Forward-Looking StatementsUse of ProceedsDividend PolicyCapitalizationDilutionSelected Historical Combined Financial DataUnaudited Pro Forma Combined Financial StatementsManagement's Discussion and Analysis of Financial Condition and Results of OperationsIndustry BackgroundBusinessManagementPrincipal StockholderArrangements between Kerr-McGee and Our CompanyDescription of Our Concurrent Financing TransactionsDescription of Capital StockShares Eligible for Future SaleMaterial United States Federal Income and Estate Tax Consequences to Non-U.S. HoldersUnderwritingLegal MattersExpertsWhere You Can Find Additional InformationIndex to Combined Financial Statements

You should rely only on the information contained in this prospectus. We have not authorized anyone to provide you with informationthat is different from that contained in this prospectus. This prospectus is not an offer to sell or a solicitation of an offer to buy shares of ourClass A common stock in any jurisdiction where an offer or sale of shares of our Class A common stock would be unlawful. The informationin this prospectus is complete and accurate only as of the date on the front cover, regardless of the time of delivery of this prospectus or of anysale of shares of our Class A common stock.

Until , 2005 (25 days after commencement of this offering), all dealers that effect transactions in our Class A commonstock, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealers' obligation todeliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.

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PROSPECTUS SUMMARY

This summary highlights the material information contained elsewhere in this prospectus but may not contain all of the information thatis important to you. You should read the entire prospectus carefully, including the combined financial statements and related notes and thefactors described in "Risk Factors," before making an investment decision.

Tronox Incorporated is currently an indirect wholly-owned subsidiary of Kerr-McGee Corporation and was formed on May 17, 2005 tohold Kerr-McGee Corporation's chemical business. Kerr-McGee's chemical business is operated by Tronox Worldwide LLC and itssubsidiaries, including Tronox LLC (formerly Kerr-McGee Chemical LLC) and various European subsidiaries. In the past, Tronox WorldwideLLC, its subsidiaries and their predecessors engaged in, and as a result have liabilities associated with, other businesses, including businessesinvolving the treatment of forest products, the production of ammonium perchlorate, the refining and marketing of petroleum products,offshore contract drilling, coal mining and the mining, milling and processing of nuclear materials.

This prospectus describes Tronox Incorporated as if it held the subsidiaries that will be transferred to it prior to closing for all historicalperiods presented. For more information, see "Management's Discussion and Analysis of Financial Condition and Results of Operations" andnote 1 to the audited combined financial statements included elsewhere in this prospectus. Unless the context otherwise requires, anyreferences in this prospectus to "we," "our," "us" and "Tronox" refer to Tronox Incorporated and its consolidated subsidiaries as in effect onthe closing date of this offering. Any references in this prospectus to "Kerr-McGee" refer to Kerr-McGee Corporation and its consolidatedsubsidiaries, other than us. Any references in this prospectus to "Tronox Worldwide" refer to Tronox Worldwide LLC (formerly Kerr-McGeeChemical Worldwide LLC).

Our Company

Overview

Tronox is one of the leading global producers and marketers of titanium dioxide. Titanium dioxide is a white pigment used in a widerange of products for its exceptional ability to impart whiteness, brightness and opacity. We market titanium dioxide pigment, whichrepresented more than 90% of our net sales in 2004, under the brand name TRONOX®. We are the world's third largest producer andmarketer of titanium dioxide based on reported industry capacity by the leading titanium dioxide producers, and we have an estimated 13%market share of the $9 billion global market in 2004 based on reported industry sales. Our world-class, high-performance pigment productsare critical components of everyday consumer applications, such as coatings, plastics and paper, as well as specialty products, such as inks,foods and cosmetics. In addition to titanium dioxide, we produce electrolytic manganese dioxide, sodium chlorate and boron-based and otherspecialty chemicals. In 2004, we had net sales of $1.3 billion and a net loss of $127.6 million. For the first nine months of 2005, we had netsales of $1.0 billion and net income of $12.6 million.

The chart below summarizes our 2004 net sales by business segment:

2004 Net Sales by Business Segment

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We have maintained strong relationships with our customers since our current chemical operations began in 1964. We focus on providingour customers with world-class products, end-use market expertise and strong technical service and support. With over 2,150 employeesworldwide, strategically located manufacturing facilities and direct sales and technical service organizations in the United States, Europe andthe Asia-Pacific region, we are able to serve our diverse base of more than 1,100 customers in over 100 countries.

Globally, including the production capacity of the facility operated by our Tiwest Joint Venture (see "Business�Manufacturing,Operation and Properties�The Tiwest Joint Venture"), we have 624,000 tonnes of aggregate annual titanium dioxide production capacity. Wehold over 200 patents worldwide, as well as other intellectual property. We have a highly skilled and technologically sophisticated workforce.

Competitive Strengths

We benefit from a number of competitive strengths, including the following:

Leading Market Positions

We are the world's third largest producer and marketer of titanium dioxide products based on reported industry capacity by the leadingtitanium dioxide producers and the world's second largest producer and supplier of titanium dioxide manufactured via proprietary chloridetechnology, which we believe is preferred for many of the largest end-use applications. We estimate that we have a 15% share of the$5.2 billion global market for the use of titanium dioxide in coatings, which industry sources consider the largest end-use market. We believeour leading market positions provide us with a competitive advantage in retaining existing customers and obtaining new business.

Global Presence

We are one of the few titanium dioxide manufacturers with global operations. We have production facilities and a sales and marketingpresence in the Americas, Europe and the Asia-Pacific region. In 2004, sales into the Americas accounted for approximately 47% of our totaltitanium dioxide net sales, followed by approximately 32% into Europe and approximately 21% into the Asia-Pacific region. Our globalpresence enables us to provide customers in over 100 countries with a reliable source of multiple grades of titanium dioxide. The diversity ofthe geographic markets we serve also mitigates our exposure to regional economic downturns.

Well-Established Relationships with a Diverse Customer Base

We sell our products to a diverse portfolio of customers with whom we have well-established relationships. Our customer base consistsof more than 1,100 customers in over 100 countries and includes market leaders in each of the major end-use markets for titanium dioxide. Wehave supplied each of our top ten customers with titanium dioxide pigment for over ten years. We work closely with our customers tooptimize their formulations, thereby enhancing the use of titanium dioxide in their production processes. This has enabled us to develop andmaintain strong relationships with our customers, resulting in a high customer retention rate.

Innovative, High-Performance Products

We offer innovative, high-performance products for nearly every major titanium dioxide end-use application, with 35 grades of titaniumdioxide pigment currently available. We are dedicated to continually developing our titanium dioxide products to better serve our customersand responding to the increasingly stringent demands of their end-use markets. Our recently-introduced products, CR-826 and CR-880, offer acombination of optical properties, opacity, ease of dispersion and durability that is

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valued by customers for a variety of applications. Sales volume of these high-performance, market-leading products increased at acompounded annual growth rate of 36% from 2000 to 2004.

Proprietary Production Technology

We are one of a limited number of producers in the titanium dioxide industry to hold the rights to a proprietary chloride process for theproduction of titanium dioxide. Approximately 83% of our gross production capacity uses this process technology, which is the subject ofnumerous patents worldwide and is utilized by our highly skilled and technologically sophisticated workforce. Titanium dioxide producedusing chloride process technology is preferred for many of the largest end-use applications. The chloride process generates less waste, usesless energy and is less labor intensive than the sulfate production process. The complexity of developing and operating the chloride processtechnology makes it difficult for others to enter and successfully compete in the chloride process titanium dioxide industry.

Experienced Management Team

Our management team has an average of 23 years of business experience. The diversity of their business experience provides a broadarray of skills that contributes to the successful execution of our business strategy. Our operations team and plant managers, who have anaverage of 27 years of manufacturing experience, participate in the development and execution of strategies that have resulted in productionvolume growth, production efficiency improvements and cost reductions. The experience, stability and leadership of our sales organizationhave been instrumental in growing sales, developing and maintaining customer relationships and increasing our market share.

Business Strategy

We use specific and individualized operating measures throughout our organization to track and evaluate key metrics. This approachserves as a scorecard to ensure alignment with, and accountability for, the execution of our strategy, which includes the followingcomponents:

Strong Customer Focus

We target our key markets with innovative, high-performance products that provide enhanced value to our customers at competitiveprices. A key component of our business strategy is to enhance our product portfolio continually with high-quality, market-driven productdevelopment. We design our titanium dioxide products to satisfy our customers' specific requirements for their end-use applications and alignour business to respond quickly and efficiently to changes in market demands. In this regard, and in order to continue meeting our customers'needs, we expect to offer at least three new titanium dioxide pigment products in 2005 and 2006 that we believe will further enhance ourmarket positions.

Technological Innovation

We employ customer and end-use market feedback, technological expertise and fundamental research to create next-generation productsand processes. Our technology development efforts include building value-added properties into our titanium dioxide to enhance itsperformance in our customers' end-use applications. Our research and development teams support our future business strategies, and wemanage those teams using disciplined project management tools and a team approach to technological development.

Operational Excellence

We achieve operational excellence by improving equipment uptime and product quality while reducing maintenance and operating costs.We use Six Sigma, a business improvement methodology, to

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improve our operational performance. As a result, in 2004, we reduced annual energy costs by $0.8 million at one of our plants, and decreasedcosts of goods sold by $1.5 million through improved yields at another. Targeting uptime with the Six Sigma methodology also recentlyenabled one of our plants to increase its annual production by 2,000 tonnes through a simple reconfiguration of its processing equipment.

Maximize Asset Efficiency

We optimize our production plan through strategic use of our global facilities to save on both transportation and warehousing costs. Ourproduction process is designed with multiple production lines. As a result, we can remedy issues with an individual line without shutting downother lines and idling an entire facility. We also actively manage production capability across all facilities. For instance, if one plant's finishinglines are already at full capacity, that plant's unfinished titanium dioxide can be transferred to another plant for finishing.

Supply Chain Optimization

We improve our supply chain efficiency by focusing on reducing both operating costs and working capital needs. Our supply chainefforts to lower operating costs consist of reducing procurement spending, lowering transportation and warehouse costs and optimizingproduction scheduling. We actively manage our working capital by increasing inventory turnover and reducing finished goods and rawmaterials inventory without affecting our ability to deliver titanium dioxide to our customers. As a result of our efforts, we reduced ourfinished goods inventory in 2004 by 27% while increasing sales volumes by approximately 9%.

Organizational Alignment

Aligning the efforts of our employees with our business strategies is critical to our success. To achieve that alignment, we evaluate theperformance of our employees using a balanced scorecard approach. We also invest in training initiatives that are directly linked to ourbusiness strategies. For instance, approximately 120 of our employees have completed the well-regarded supply chain management trainingprogram at Michigan State University's Broad Executive School of Management. We also train our employees in Six Sigma methodology tosupport our operational excellence and asset efficiency strategic objectives.

Our Relationship with Kerr-McGee

We are currently an indirect wholly-owned subsidiary of Kerr-McGee Corporation. Kerr-McGee is engaged in two distinct businesses: anoil and gas exploration and production business and a chemical business. We were formed on May 17, 2005 to hold Kerr-McGee's chemicalbusiness and to effect this offering and the related concurrent transactions. See "�The Transactions." Kerr-McGee's chemical businesscurrently is operated by Tronox Worldwide and its subsidiaries, including Tronox LLC and various European subsidiaries. Prior to the closingof this offering, Kerr-McGee will transfer Tronox Worldwide to us. Kerr-McGee will represent and warrant that it has good and valid title tothe equity interests in Tronox Worldwide, but otherwise Kerr-McGee is not making any representations or warranties to us of any nature,including regarding the assets of, or any other matters relating to, the chemical business.

Tronox Worldwide has been in business since 1929. Tronox Worldwide, its subsidiaries and their predecessors have operated a numberof businesses in addition to the current chemical business, including businesses involving the treatment of forest products, the production ofammonium perchlorate, the refining and marketing of petroleum products, offshore contract drilling and the mining, milling and processing ofnuclear materials. Tronox Worldwide and its subsidiaries are, and as a

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result we will be, subject to significant liabilities associated with those other businesses. See "Risk Factors�Risks Related to Our Business andIndustry�We will be subject to significant liabilities that are in addition to those associated with our primary business. These liabilities couldadversely affect our financial condition and results of operations and we could suffer losses as a result of these liabilities even if our primarybusiness performs well."

After completion of this offering, investors in this offering will own all of our outstanding Class A common stock. Kerr-McGee will notown any of our Class A common stock but will indirectly own all of our outstanding Class B common stock, which will represent 88.7% ofthe combined voting power of all outstanding classes of our common stock (assuming no exercise by the underwriters of their option topurchase additional shares). See "Principal Stockholder." As a result, Kerr-McGee will be able to control the vote on all matters submitted toour stockholders, including the election of directors. See "Risk Factors�Risks Related to Our Relationship with Kerr-McGee�As long as Kerr-McGee owns shares of our common stock representing a majority of the voting power of our common stock, it will control us and the influenceof our other stockholders over significant corporate actions will be limited."

Kerr-McGee has advised us that, subject to the terms of its agreement with the underwriters (as discussed in "Underwriting�Lock-UpAgreements"), following completion of this offering it intends to distribute all of the shares of our Class B common stock that it owns to itsstockholders (the "Distribution"). Kerr-McGee expects to accomplish the Distribution through a spin-off, split-off or a combination of bothtransactions. A spin-off would take the form of a pro rata distribution by Kerr-McGee of its shares of our Class B common stock to holders ofKerr-McGee's common stock. A split-off would be an exchange offer pursuant to which holders of shares of common stock of Kerr-McGeewould be invited to exchange those shares for our Class B common stock that Kerr-McGee then holds. However, Kerr-McGee is not requiredto complete the Distribution. Kerr-McGee has the sole discretion to decide if and when the Distribution will occur and to determine the form,the structure and all other terms of any transactions to effect the Distribution. For a more detailed discussion of the Distribution, please see"Arrangements between Kerr-McGee and Our Company" and "Risk Factors�Risks Related to Our Relationship with Kerr-McGee�TheDistribution may not occur, and we may not achieve the expected benefits of the Distribution."

Prior to the completion of this offering, we will enter into agreements with Kerr-McGee that, regardless of whether the Distributionoccurs, will govern the separation of our businesses and various interim and ongoing relationships, including agreements with respect to theprovision of interim services by Kerr-McGee to us. Under the terms of these agreements, we are entitled to the ongoing assistance of Kerr-McGee only for a limited period of time. See "Arrangements between Kerr-McGee and Our Company." All of the agreements relating to ourseparation from Kerr-McGee have been made in the context of a parent-subsidiary relationship and have been entered into in the overallcontext of our separation from Kerr-McGee. The terms of these agreements may be less favorable to us than if they had been negotiated withunaffiliated third parties. See "Risk Factors�Risks Related to Our Relationship with Kerr-McGee�Our separation agreements with Kerr-McGee may be less favorable to us than if they had been negotiated with unaffiliated third parties" and "Arrangements between Kerr-McGeeand Our Company."

We believe that our separation from Kerr-McGee will enable us to realize the following benefits:

�� Focused management attention. Our separation from Kerr-McGee will allow us to focus managerial attention solely on ourbusiness, resulting in stream-lined decision-making, more efficient deployment of resources, increased operational flexibilityand enhanced responsiveness to our customers and markets.

�� Incentives for our employees to be more directly linked to our performance. Our separation from Kerr-McGee will enable usto offer our employees compensation more directly linked to the performance of our business.

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�� Direct access to the capital markets. As a separate public company, we will have direct access to the capital markets, therebyenabling us to optimize our capital structure to meet the specific needs of our chemical business.

The Transactions

In this prospectus, we refer to the following collectively as the "Transactions":

�� the recapitalization of our company prior to the completion of this offering, in which our common stock held by Kerr-McGeewill convert into approximately 22.9 million shares of our Class B common stock;

�� the offering and sale of 17,480,000 shares of our Class A common stock at an assumed initial offering price of $19.50 pershare, which is the midpoint of the range set forth on the cover page of this prospectus;

�� the concurrent joint private offering by Tronox Worldwide and Tronox Finance Corp. (which will become our wholly-ownedsubsidiaries prior to closing) of $350 million in aggregate principal amount of unsecured notes due 2012, which we refer to asthe "unsecured notes";

�� Tronox Worldwide's concurrent entry into a senior secured credit facility consisting of a $200 million term loan facility and a$250 million revolving credit facility, which we refer to together as the "senior secured credit facility," and separately as the"term loan facility" and the "revolving credit facility," respectively; and

�� the distribution of the net proceeds from our offering of Class A common stock, the unsecured notes and the term loan facilityto Kerr-McGee.

The offering of our Class A common stock, the completion of the private offering of the unsecured notes and the entry into the seniorsecured credit facility are conditioned upon one another. As a result, if Tronox Worldwide and Tronox Finance Corp. do not complete theoffering of the unsecured notes or Tronox Worldwide does not enter into the senior secured credit facility, this offering of our Class Acommon stock will not be completed.

Conversion of Our Common Stock

Prior to completion of this offering, all of the issued and outstanding shares of our common stock, which are held by Kerr-McGee, willbe converted into 22,889,431 shares of Class B common stock.

The Class A Common Stock

We are offering 17,480,000 shares of our Class A common stock. The initial offering price of the Class A common stock is expected tobe between $18.50 and $20.50 per share. The net proceeds from our offering of Class A common stock will be distributed to Kerr-McGee.

The Unsecured Notes

Tronox Worldwide and Tronox Finance Corp. are offering $350 million in aggregate principal amount of unsecured notes due 2012 in aconcurrent private offering. We, together with Tronox Worldwide's material direct and indirect wholly-owned domestic subsidiaries, willguarantee Tronox Worldwide's and Tronox Finance Corp.'s obligations under the unsecured notes. See "Description of Our ConcurrentFinancing Transactions�Unsecured Notes" for a more detailed description of the unsecured notes. The unsecured notes will be offered andsold only to qualified institutional buyers in reliance on Rule 144A under the Securities Act and to certain non-U.S. persons in transactions



outside the United States in reliance on Regulation S under the Securities Act. The unsecured notes are not being registered under theSecurities Act and may not be offered or sold in the United States absent

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registration or an applicable exemption from registration requirements. The net proceeds from the sale of the unsecured notes will bedistributed to Kerr-McGee.

The Senior Secured Credit Facility

Concurrent with the completion of this offering, Tronox Worldwide will enter into a senior secured credit facility consisting of a$200 million six-year term loan facility and a $250 million five-year multicurrency revolving credit facility. The full amount of the revolvingcredit facility will be available for issuances of letters of credit and $25 million of the revolving credit facility will be available for swinglineloans. The senior secured credit facility will be guaranteed by us and Tronox Worldwide's direct and indirect material domestic subsidiaries(including Tronox Finance Corp.). The facility will be secured by:

�� a pledge of 100% of the equity interests in Tronox Worldwide;

�� a pledge of 100% of the capital stock of, or other equity interests in, Tronox Worldwide's direct and indirect domesticsubsidiaries (including Tronox Finance Corp.);

�� a pledge of the capital stock of, or other equity interests in, Tronox Worldwide's direct foreign subsidiaries and the directforeign subsidiaries of the guarantors of the senior secured credit facility, up to 65% of the voting and 100% of the non-votingcapital stock or other equity interests outstanding; and

�� a first priority security interest in certain domestic assets, including certain real property, of Tronox Worldwide and theguarantors of the senior secured credit facility.

See "Description of Our Concurrent Financing Transactions�Senior Secured Credit Facility" for a more detailed description of thesenior secured credit facility.

On the completion of this offering, the new term loan facility is expected to be fully funded and the net proceeds from that facility will bedistributed to Kerr-McGee. Undrawn amounts under the revolving credit facility will be available on a revolving basis for general corporatepurposes of Tronox Worldwide and its subsidiaries, subject to specified conditions.

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Corporate Structure

The chart below shows Tronox's corporate structure after giving effect to the Transactions:

(1)Represents 56.7% of the outstanding shares of all classes of our common stock and 88.7% of the voting power of all classes of our common stock.

(2)Represents 43.3% of the outstanding shares of all classes of our common stock and 11.3% of the voting power of all classes of our common stock.

(3)The senior secured credit facility will consist of a $200 million six-year term loan facility and a $250 million five-year multicurrency revolving credit facility. The senior

secured credit facility will be guaranteed by Tronox and Tronox Worldwide's direct and indirect material domestic subsidiaries (including Tronox Finance Corp.). The

facility will be secured by a first priority security interest in certain domestic assets, including certain real property, of Tronox Worldwide and the guarantors of the senior

secured credit facility. The facility will also be secured by pledges of the equity interests in Tronox Worldwide and Tronox Worldwide's direct and indirect domestic

subsidiaries (including Tronox Finance Corp.), and up to 65% of the voting and 100% of the non-voting equity interests in Tronox Worldwide's direct foreign subsidiaries

and the direct foreign subsidiaries of the guarantors of the senior secured credit facility.



(4)Tronox Worldwide and its wholly-owned direct subsidiary, Tronox Finance Corp., will co-issue $350 million in aggregate principal amount of unsecured notes, which will

be guaranteed by Tronox and Tronox Worldwide's material direct and indirect domestic wholly-owned subsidiaries.

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The Offering

Issuer Tronox Incorporated

Class A common stock offered by the issuer 17,480,000 shares

Underwriters' option to purchase additional sharesof Class A common stock

2,622,000 shares

Class B common stock to be held by Kerr-McGeeimmediately after the offering (assumes noexercise by the underwriters of their option topurchase additional shares of Class A commonstock)

22,889,431 shares

Common stock outstanding immediately after theoffering (assumes no exercise by the underwritersof their option to purchase additional shares ofClass A common stock):

Class A common stock 17,480,000 shares

Class B common stock 22,889,431 shares

Total 40,369,431 shares

Use of proceeds

We estimate that the net proceeds from this offering of Class A common stock, afterdeducting estimated underwriting discounts and commissions and estimated offeringexpenses, will be approximately $316.0 million ($363.8 million if the underwritersexercise in full their option to purchase additional shares), assuming an initial offeringprice of $19.50 per share, which is the midpoint of the range set forth on the coverpage of this prospectus. We estimate that the net proceeds from the term loan facilityand the private offering of unsecured notes, after deducting estimated expenses relatedto those transactions, will be approximately $539.0 million. We intend to distribute allof the net proceeds from this offering, the term loan facility and the unsecured notesoffering and cash on hand in excess of $40 million to Kerr-McGee. We estimate thatthe aggregate amount of distributions to Kerr-McGee will be approximately$895.0 million ($942.8 million if the underwriters exercise in full their option topurchase additional shares). See "Use of Proceeds."

Dividend policy

Following completion of this offering and subject to the terms of the senior securedcredit facility and the indenture governing the unsecured notes, we intend to pay aregular quarterly dividend to holders of our Class A common stock and Class Bcommon stock. The declaration and payment of dividends is discretionary, and theamount, if any, will depend upon our financial condition, our earnings and cash flows,our capital requirements, contractual restrictions and other factors deemed relevant byour board of directors. See "Dividend Policy."

Voting rights



Class A common stockOne vote per share for all matters on which stockholders are entitled to vote, includingthe election and removal of directors.

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Class Bcommonstock

Six votes per share for all matters on which stockholders are entitled to vote, including the election and removal of directors.

Othercommonstockprovisions

Apart from the different voting rights described above, the holders of Class A and Class B common stock generally haveidentical rights, except that the holders of Class A common stock are not eligible to vote on any alteration of the powers,preferences or special rights of the Class B common stock that would not adversely affect the Class A common stock. See"Description of Capital Stock."

New YorkStockExchangelisting

Our Class A common stock has been approved for listing on the New York Stock Exchange under the symbol "TRX,"subject to official notice of issuance.

RightsOne preferred share purchase right will be issued and will trade together with each share of our Class A and Class Bcommon stock. These rights will become exercisable only upon the occurrence of certain events, as described under"Description of Capital Stock�The Rights Agreement."

Information in this Prospectus

Unless we specifically state otherwise, all information in this prospectus regarding our Class A common stock:

�� gives effect to the Transactions;

�� assumes no exercise by the underwriters of their option to purchase 2,622,000 additional shares of Class A common stock;

�� excludes approximately 6.1 million shares of our Class A common stock reserved for issuance under our long term incentiveplan for our employees and directors, including approximately 0.4 million shares of our Class A common stock issuable uponexercise of stock options and approximately 0.4 million restricted shares of our Class A common stock expected to be grantedin connection with this offering. See "Management�Long Term Incentive Plan�Initial Grants"; and

�� excludes shares of our Class A common stock issuable in connection with Kerr-McGee stock-based awards that will beconverted into or replaced by our stock-based awards on the effective date of the Distribution. See "Management�Treatment ofKerr-McGee Stock Options, Restricted Stock and Performance Unit Awards," "Arrangements between Kerr-McGee and OurCompany�Employee Benefits Agreement�Kerr-McGee Stock Options and Restricted Stock" and "Arrangements between Kerr-McGee and Our Company�Employee Benefits Agreement�Incentive Plans."

Risk Factors

Investing in our Class A common stock involves risk. You should carefully consider all of the information set forth in this prospectusand, in particular, should evaluate the specific factors set forth under "Risk Factors" beginning on page 16 in deciding whether to invest in ourClass A common stock.

Corporate Information

Tronox Incorporated is a Delaware corporation that was incorporated, originally as "New-Co Chemical, Inc.," on May 17, 2005. Ourwebsite address is www.tronox.com. The information on our website is not incorporated by reference into this prospectus, and you should not



consider information on our website a part of this prospectus. Our principal executive offices are located at 123 Robert S. Kerr Avenue,Oklahoma City, Oklahoma 73102. Our telephone number is (405) 270-1313.

10



Summary Historical and Pro Forma Combined Financial Data

The following tables set forth the summary historical and pro forma combined financial data as of the dates and for the periods indicatedin such tables. The summary historical combined financial data presented below for the years ended December 31, 2004, 2003 and 2002 havebeen derived from the audited combined financial statements included elsewhere in this prospectus. The summary historical combinedfinancial data presented below as of September 30, 2005 and for the nine-month periods ended September 30, 2005 and 2004 have beenderived from the interim unaudited condensed combined financial statements included elsewhere in this prospectus. In the opinion of ourmanagement, the interim unaudited condensed combined financial statements have been prepared on a basis consistent with the auditedcombined financial statements and include all adjustments, consisting only of normal and recurring adjustments, necessary for a fairpresentation of the results for the periods presented. Results of operations for the nine-month period ended September 30, 2005 are notnecessarily indicative of the operating results to be expected for the full fiscal year 2005 or for any future periods.

The summary unaudited pro forma combined financial data for the year ended December 31, 2004 and as of and for the nine-monthperiod ended September 30, 2005 set forth below have been prepared to give effect to this offering and the related transactions describedbelow, as if those transactions had occurred on the date or at the beginning of the periods indicated:

�� the recapitalization of our company prior to the completion of this offering, in which our common stock held by Kerr-McGeewill convert into approximately 22.9 million shares of Class B common stock;

�� the issuance and sale of 17,480,000 shares of our Class A common stock in this offering and the receipt of estimated netproceeds of approximately $316.0 million, assuming an initial offering price of $19.50 per share, which is the midpoint of therange set forth on the cover page of this prospectus;

�� the issuance by Tronox Worldwide and Tronox Finance Corp. of $350 million of unsecured notes in a concurrent privateoffering and the receipt of estimated net proceeds from that offering of approximately $343.1 million;

�� the borrowing by Tronox Worldwide of $200 million under the term loan facility and the receipt of estimated net proceeds ofapproximately $195.9 million;

�� the distribution of the net proceeds from this offering, the unsecured notes and the term loan facility to Kerr-McGee;

�� the elimination from the historical combined financial statements of net interest expense allocated to us by Kerr-McGee basedon specifically-identified borrowings;

�� the incremental selling, general and administrative costs resulting from us becoming a stand-alone company;

�� the transfer to us by Kerr-McGee, and the assumption by us, on the effective date of the Distribution, of assets and liabilitiesrelated to incentive awards, health and welfare plan benefits, retirement plans and savings plans;

�� the distribution to Kerr-McGee by us of cash on hand in excess of $40 million; and



�� the change in our income taxes resulting from the transactions described above.

The summary unaudited pro forma combined financial data are for informational purposes only, are not projections of our futurefinancial performance, and should not be considered indicative of actual results that would have been achieved had the transactions actuallybeen consummated on the

11



date or at the beginning of the periods indicated. Please see the notes to the unaudited pro forma combined financial data for a more detaileddiscussion of how the adjustments described above are presented.

The summary historical and pro forma combined financial data presented below should be read together with "Use of Proceeds,""Capitalization," "Selected Historical Combined Financial Data," "Unaudited Pro Forma Combined Financial Statements," "Management'sDiscussion and Analysis of Financial Condition and Results of Operations" and the combined financial statements and the notes to thosestatements, in each case, included elsewhere in this prospectus.

Nine Months

Ended September 30,Year Ended December 31,

2005 2004

Pro

Forma

2005

2004 2003 2002

Pro

Forma

2004

(millions of dollars, except per share amounts)

Combined Statement of Operations Data:

Net sales $ 1,017.5 $ 939.9 $ 1,017.5 $ 1,301.8 $ 1,157.7 $ 1,064.3 $ 1,301.8

Gross margin 169.9 95.9 169.9 132.9 133.0 115.3 132.9

Selling, general and administrative expenses 85.9 80.2 100.9 110.1 98.9 84.0 130.1

Restructuring charges(1) � 112.1 � 113.0 61.4 11.8 113.0

Provision for environmental remediation and

restoration, net of reimbursements17.0 3.6 17.0 4.6 14.9 14.3 4.6

Interest expense, net(2) 10.9 6.6 30.4 9.6 8.9 11.2 43.2

Other expense(3) 1.2 13.4 1.2 15.7 11.7 2.0 15.7

Income (loss) from continuing operations before

income taxes54.9 (120.0) 20.4 (120.1) (62.8) (8.0) (173.7)

Income tax benefit (provision) (20.5) 38.1 (8.4) 38.3 15.1 (8.3) 45.3


cumulative effect of change in accounting principle34.4 (81.9) $ 12.0 (81.8) (47.7) (16.3) $ (128.4)

Loss from discontinued operations, net of income tax

benefit(21.8) (45.3) (45.8) (35.8) (81.0)

Income (loss) before cumulative effect of change in

accounting principle12.6 (127.2) (127.6) (83.5) (97.3)

Cumulative effect of change in accounting principle,

net of income tax benefit� � � (9.2) �

Net income (loss) $ 12.6 $ (127.2) $ (127.6) $ (92.7) $ (97.3)

Pro forma income (loss) from continuing operations

per share�basic and diluted$ 1.50 $ 0.30 $ (3.57) $ (3.18)

Weighted average common shares outstanding�basic 22.9 40.4 22.9 40.4

Other Financial Data:

Cash flows from:

Operating activities(4) $ 13.0 $ 80.8 $ 190.8 $ 120.4 $ 82.4

Investing activities(4) 118.2 (63.1) (91.4) (95.7) (86.6)



Financing activities (81.2) (40.2) (131.1) (10.3) 4.1

Depreciation and amortization expense 78.1 76.9 104.6 106.5 105.7

Asset write-downs and impairments 12.3 122.0 122.4 28.7 20.2

Capital expenditures 51.7 63.7 92.5 99.4 86.7

Adjusted EBITDA(5) 180.7 116.7 $ 165.7 162.2 160.3 134.5 $ 142.2

12



Nine Months


2005 2004 2004 2003 2002

(volumes and capacity

in thousands of tonnes)

Titanium Dioxide Operating Statistics:

Production volumes:

100% owned facilities 357.0 358.5(7) 477.3(7) 484.1 459.8

50% owned production�Tiwest joint venture(6) 39.2 40.0 53.5 47.4 48.2

Total Tronox production 396.2 398.5(7) 530.8(7) 531.5 508.0

Product purchased from Tiwest joint venture partner(6) 39.2 40.0 53.5 47.4 48.2

Total production marketed by Tronox 435.4 438.5(7) 584.3(7) 578.9 556.2

Annual or nine-month production capacity, as applicable:(8)

100% owned facilities 385.5 385.5(7) 514.0(7) 568.0 512.0

50% owned production�Tiwest joint venture(6) 41.3 37.5 55.0 50.0 47.5

Total Tronox production capacity 426.8 423.0(7) 569.0(7) 618.0 559.5

Production capacity of Tiwest joint venture partner(6) 41.3 37.5 55.0 50.0 47.5

Total production capacity available for Tronox to market 468.1 460.5(7) 624.0(7) 668.0 607.0

As of

September 30, 2005

HistoricalPro

Forma

(millions of dollars)

Combined Balance Sheet Data:

Cash and cash equivalents $ 76.7 $ 40.0

Working capital(9) 459.1 418.9

Total assets 1,703.0 1,676.0

Long-term debt � 548.0

Business/stockholders' equity 1,017.6 284.2(1)

Restructuring charges in 2004 include costs associated with the shutdown of our titanium dioxide pigment sulfate production at our Savannah, Georgia facility.

Restructuring charges in 2003 include costs associated with the shutdown of our synthetic rutile plant in Mobile, Alabama and charges in connection with a work force

reduction program consisting of both voluntary retirements and involuntary terminations. Restructuring charges in 2002 represent a write-down of fixed assets for

abandoned engineering projects.

(2)Includes interest expense allocated to us by Kerr-McGee based on specifically identified borrowings from Kerr-McGee at Kerr-McGee's average borrowing rates. See

note 20 to the audited combined financial statements and note 9 to the interim unaudited condensed combined financial statements, in each case included elsewhere in this

prospectus.



(3)Includes net foreign currency transaction gain (loss), equity in net earnings of equity method investees, loss on accounts receivable sales and other expenses. See note 20 to

the audited combined financial statements and note 9 to the interim unaudited condensed combined financial statements, in each case included elsewhere in this

prospectus.

(4)Through April 2005, we had an accounts receivables monetization program with a maximum availability of $165 million. In April 2005, Kerr-McGee entered into an

agreement to terminate the program by repurchasing the then outstanding balance of accounts receivable sold of $165 million. The repurchased receivables were then

contributed by Kerr-McGee to us and our collections on such receivables of $165 million are included in net cash flows from investing activities for the nine-month period

ended September 30, 2005. Additionally, termination of the accounts receivable monetization program resulted in a reduction of our cash flows from operating activities

for the first nine months of 2005 because the collection period for accounts receivable arising from pigment sales subsequent to program termination is longer compared

with the collection period of receivables prior to program termination. See "Management's Discussion and Analysis of Financial Condition and Results of

Operations�Financial Condition�Off-Balance Sheet Arrangements�Accounts Receivable Monetization Program."

(5)EBITDA represents net income (loss) before net interest expense, income tax benefit (provision), and depreciation and amortization expense. Adjusted EBITDA represents

EBITDA as further adjusted to reflect the items set forth in the table below, all of which will be required in determining our compliance with financial covenants under our

senior secured credit facility. See "Description of Our Concurrent Financing Transactions�Senior Secured Credit Facility."

We have included EBITDA and adjusted EBITDA in this prospectus to provide investors with a supplemental measure of our operating performance and information

about the calculation of some of the financial covenants that will be contained in our new senior secured credit facility. We believe EBITDA is an important supplemental

measure of operating performance

13



because it eliminates items that have less bearing on our operating performance and so highlights trends in our core business that may not otherwise be apparent when

relying solely on GAAP financial measures. We also believe that securities analysts, investors and other interested parties frequently use EBITDA in the evaluation

of issuers, many of which present EBITDA when reporting their results. Adjusted EBITDA is a material component of the covenants that will be imposed on us by

the senior secured credit facility. Under the senior secured credit facility, we will be subject to financial covenant ratios that will be calculated by reference to

adjusted EBITDA. Non-compliance with the financial covenants contained in the senior secured credit facility could result in a default, an acceleration in the

repayment of amounts outstanding, and a termination of the lending commitments under the senior secured credit facility. Any acceleration in the repayment of

amounts outstanding under the senior secured credit facility would result in a default under the indenture governing the unsecured notes. While an event of default

under the senior secured credit facility or the indenture governing the unsecured notes is continuing, we would be precluded from, among other things, paying

dividends on our common stock or borrowing under the revolving credit facility. For a description of required financial covenant levels and actual ratio calculations

based on adjusted EBITDA, see "Management's Discussion and Analysis of Financial Condition and Results of Operations�Financial Condition�Liquidity and

Capital Resources Following the Transactions�Covenant Compliance." Our management also uses EBITDA and adjusted EBITDA in order to facilitate operating

performance comparisons from period to period and prepare annual operating budgets.

EBITDA and adjusted EBITDA are not presentations made in accordance with generally accepted accounting principles, or GAAP. As discussed above, we believe that

the presentation of EBITDA and adjusted EBITDA in this prospectus is appropriate. However, when evaluating our results, you should not consider EBITDA and adjusted

EBITDA in isolation of, or as a substitute for, measures of our financial performance as determined in accordance with GAAP, such as net income (loss). EBITDA and

adjusted EBITDA have material limitations as performance measures because they exclude items that are necessary elements of our costs and operations. Because other

companies may calculate EBITDA and adjusted EBITDA differently than we do, EBITDA may not be, and adjusted EBITDA as presented in this prospectus is not,

comparable to similarly-titled measures reported by other companies.

The following table reconciles net income (loss) to EBITDA and adjusted EBITDA for the periods presented:

Nine Months

Ended September 30,Year ended December 31,

2005 2004

Pro

Forma

2005

2004 2003 2002

Pro

Forma

2004


Net income (loss)(a) $ 12.6 $ (127.2) $ (9.8) $ (127.6) $ (92.7) $ (97.3) $ (174.2)

Net interest expense 10.9 6.6 30.4 9.6 8.9 11.2 43.2

Income tax provision (benefit) 8.8 (62.4) (3.3) (63.0) (39.3) (35.3) (70.0)

Depreciation and amortization expense 78.1 76.9 78.1 104.6 106.5 105.7 104.6

EBITDA 110.4 (106.1) 95.4 (76.4) (16.6) (15.7) (96.4)

Savannah sulfate facility shutdown costs � 28.7 � 29.0 � � 29.0

Loss from discontinued operations(b) 33.5 69.0 33.5 69.7 51.9 120.1 69.7



Extraordinary, unusual or non-recurring expenses or

losses(c) � � � (0.3) 47.0 � (0.3)

Noncash charges constituting:

(Gain) loss on sales of accounts receivable(d) (0.2) 5.8 (0.2) 8.2 4.8 4.7 8.2

Write-downs of property, plant and equipment

and other assets(e) 8.5 100.4 8.5 104.8 29.3 18.5 104.8

Impairment of intangible assets � 7.4 � 7.4 � � 7.4

Cumulative effect of change in accounting

principle� � � � 14.1 � �



Asset retirement obligations 1.0 � 1.0 � � � �

Other items(f) 10.5 7.9 10.5 15.2 14.9 (7.4) 15.2

Adjusted EBITDA $ 180.7 $ 116.7 $ 165.7 $ 162.2 $ 160.3 $ 134.5 $ 142.2

(a)Net income (loss) includes the following operating losses associated with our Savannah sulfate facility, which was closed in September 2004:

(i) $17.8 million, $18.6 million and $9.6 million for the years ended December 31, 2004, 2003 and 2002, respectively, and (ii) $2.0 million and $16.8 million

for the nine months ended September 30, 2005 and 2004, respectively.

(b)Includes provisions for environmental remediation and restoration, net of reimbursements, related to our former forest products operations, thorium

manufacturing, uranium and refining operations of $61.5 million, $41.1 million and $61.1 million for the years ended December 31, 2004, 2003 and 2002,

respectively, and $20.4 million and $61.9 million for the nine months ended September 30, 2005 and 2004, respectively.

14



(c)Includes $25.8 million associated with the closure of our Mobile, Alabama facility in 2003 for charges not reflected elsewhere and $21.2 million for a

workforce reduction program for continuing operations in 2003. See note 15 to the audited combined financial statements included elsewhere in this

prospectus.

(d)Loss on the sales of accounts receivable under an asset monetization program, or a factoring program, comparable to interest expense.

(e)Includes $86.6 million associated with the shutdown of our Savannah sulfate facility for the year ended December 31, 2004.

(f)Includes noncash stock-based compensation, noncash pension and postretirement cost and accretion expense.

(6)One of our subsidiaries has a 50% undivided interest in the assets comprising the operations conducted in Australia under the Tiwest joint venture arrangement, which is

further discussed in "Business�Manufacturing, Operation and Properties�The Tiwest Joint Venture."

(7)Excludes production volumes from our Savannah sulfate facility, which was closed in September 2004, of 17.7 tonnes for the nine months ended September 30, 2004 and

17.7 tonnes for the year ended December 31, 2004.

(8)Nine-month production capacity is based on annualized numbers.

(9)Working capital is defined as the excess of current assets over current liabilities.

15



RISK FACTORS

An investment in our Class A common stock involves risk. You should consider carefully the following factors and the other informationin this prospectus before deciding to purchase any shares of our Class A common stock. If any of the following risks were actually to occur,our business, financial condition or results of operations could be materially and adversely affected. In that case, the trading price of ourClass A common stock could decline, and you might lose all or part of your investment.

Risks Related to Our Business and Industry

We will be subject to significant liabilities that are in addition to those associated with our primary business. These liabilities couldadversely affect our financial condition and results of operations and we could suffer losses as a result of these liabilities even if ourprimary business performs well.

Prior to the completion of this offering, Kerr-McGee will transfer to us those of its subsidiaries that currently operate its chemicalbusiness, including Tronox Worldwide and its subsidiaries. Tronox Worldwide, its subsidiaries and their predecessors have operated a numberof businesses in addition to the current chemical business, including businesses involving the treatment of forest products, the production ofammonium perchlorate, the refining and marketing of petroleum products, offshore contract drilling and the mining, milling and processing ofnuclear materials. As a result, we will be subject to significant liabilities that are in addition to those associated with our primary business,including legal, regulatory and environmental liabilities. For example, we will have liabilities relating to the remediation of various sites atwhich chemicals such as creosote, perchlorate, low-level radioactive substances, asbestos and other materials have been used or disposed. Ourfinancial condition and results of operations could be adversely affected by these liabilities. We also could suffer losses as a result of theseliabilities even if our primary business performs well. See note 21 to the audited combined financial statements and note 10 to the interimunaudited condensed combined financial statements included elsewhere in this prospectus for a discussion of contingencies.

The costs of compliance with the extensive environmental, health and safety laws and regulations to which we are subject or the inabilityto obtain, update or renew permits required for the operation of our business could reduce our profitability or otherwise adversely affectus.

Our current and former operations involve the generation and management of regulated materials that are subject to variousenvironmental laws and regulations and are dependent on the periodic renewal of permits from various governmental agencies. The inabilityto obtain, update or renew permits related to the operation of our businesses, or the costs required in order to comply with permit standards,could have a material adverse affect on us. For example, we are currently updating permits related to water and air emissions for our facility inBotlek, the Netherlands. Although we do not anticipate any significant difficulties in obtaining such permits or that any material expenditureswill be required, the failure to update such permits could have a material adverse effect on our ability to produce our products and on ourresults of operations.

In addition, changes in the laws and regulations to which we are subject, or their interpretation, or the enactment of new laws andregulations, could result in materially increased and unanticipated capital expenditures and compliance costs. For example, the proposedREACH (Registration, Evaluation and Authorization of Chemicals) regulatory scheme in the European Union, if implemented as currentlyproposed, could adversely affect our European operations by imposing on us a testing, evaluation and registration program for some of thechemicals that we use or produce. We are not able to predict the ultimate cost of compliance with these requirements or their effect on ourbusiness.

Environmental laws and regulations obligate us to remediate various sites at which chemicals such as creosote, perchlorate, low-levelradioactive substances, asbestos and other materials have been disposed of or released. Some of these sites have been designated Superfundsites by the

16



Environmental Protection Agency under the Comprehensive Environmental Response, Compensation and Liability Act. See note 21 to theaudited combined financial statements and note 10 to the interim unaudited condensed combined financial statements included elsewhere inthis prospectus for a discussion of these matters. The discovery of contamination arising from historical industrial operations at some of ourproperties has exposed us, and in the future may continue to expose us, to significant remediation obligations and other damages.

The actual costs of environmental remediation and restoration could exceed estimates.

As of September 30, 2005, we had reserves in the amount of $239.4 million for environmental remediation and restoration. We reservefor costs related to environmental remediation and restoration only when a loss is probable and the amount is reasonably estimable. Inestimating our environmental liabilities, including the cost of investigation and remediation at a particular site, we consider a variety ofmatters, including, but not limited to, the stage of the investigation at the site, the stage of remedial design for the site, the availability ofexisting remediation technologies, presently-enacted laws and regulations and the state of any related legal or administrative investigation orproceedings. For example, at certain sites we are in the preliminary stages of our environmental investigation and therefore have reserved forsuch sites amounts equal only to the cost of our environmental investigation. The findings of these site investigations could result in anincrease in our reserves for environmental remediation. While we believe we have established appropriate reserves for environmentalremediation based on the information we currently know, additions to the reserves may be required as we obtain additional information thatenables us to better estimate our liabilities.

Our estimates of environmental liabilities at a particular site could increase significantly as a result of, among other things, changes inlaws and regulations, revisions to the site's remedial design, unanticipated construction problems, identification of additional areas or volumesof contamination, increases in labor, equipment and technology costs, changes in the financial condition of other potentially responsibleparties and the outcome of any related legal and administrative proceedings to which we are or may become a party. For example, in 2002, wereached an agreement with various local, state and federal entities for remediation at Kress Creek and the Sewage Treatment Plant, each partof the West Chicago site, which provides for the characterization and cleanup of the sites, past and future government response costs, and thewaiver of natural resource damage claims. As a result, in that year we increased our reserves for environmental remediation with respect toKress Creek by $83.8 million, which was part of a total increase in our environmental reserves of $188.1 million, a portion of which isreported as loss from discontinued operations. See "Management's Discussion and Analysis of Financial Condition and Results ofOperations�Environmental Matters�Environmental Costs."

In addition to the sites for which we have established reserves, there may be other sites where we have potential liability forenvironmental-related matters but for which we do not have sufficient information to determine that a liability is probable and reasonablyestimable. As we obtain additional information about those sites, we may need to increase our reserves. New environmental claims may alsoarise as a result of changes in environmental laws and regulations or for other reasons. If new claims arise and losses associated with thoseclaims become probable and reasonably estimable, we will need to increase our reserves to reflect those new claims.

As a result of the factors described above, it is not possible for us to reliably estimate the amount and timing of all future expendituresrelated to environmental or other contingent matters and our actual costs could exceed our current reserves. See "Business�GovernmentRegulations and Environmental Matters" and "Business�Legal Proceedings."

17



Hazards associated with chemical manufacturing could adversely affect our results of operations.

Due to the nature of our business, we are exposed to the hazards associated with chemical manufacturing and the related storage andtransportation of raw materials, products and wastes. These hazards could lead to an interruption or suspension of operations and have anadverse effect on the productivity and profitability of a particular manufacturing facility or on us as a whole. Potential hazards include thefollowing:

�� piping and storage tank leaks and ruptures;

�� mechanical failure;

�� employee exposure to hazardous substances; and

�� chemical spills and other discharges or releases of toxic or hazardous substances or gases.

While we are not aware of any such risks currently, there is also a risk that one or more of our key raw materials or one or more of ourproducts may be found to have toxicological or health-related impact on the environment or on our customers or employees. These hazardsmay cause personal injury and loss of life, damage to property and contamination of the environment, which could lead to government fines orwork stoppage injunctions and lawsuits by injured persons. If such actions are determined adversely to us, we may have inadequate insuranceto cover such claims, or we may have insufficient cash flow to pay for such claims. Such outcomes could adversely affect our financialcondition and results of operations.

Violations or noncompliance with the extensive environmental, health and safety laws and regulations to which we are subject could resultin unanticipated loss or liability.

Our operations and production facilities are subject to extensive environmental and health and safety laws and regulations at national,international and local levels in numerous jurisdictions relating to pollution, protection of the environment, transporting and storing rawmaterials and finished products and storing and disposing of hazardous wastes. We may incur substantial costs, including fines, damages,criminal or civil sanctions and remediation costs, or experience interruptions in our operations, for violations arising under these laws andregulations. In the event of a catastrophic incident involving any of the raw materials we use or chemicals we produce, we could incur materialcosts as a result of addressing the consequences of such event.

We are party to a number of legal and administrative proceedings involving environmental and other matters pending in various courtsand before various agencies. These include proceedings associated with facilities currently or previously owned, operated or used by us or ourpredecessors, and include claims for personal injuries, property damages, injury to the environment, including natural resource damages, andnon-compliance with permits. Any determination that one or more of our key raw materials or products, or the materials or productsassociated with facilities previously owned, operated or used by us or our predecessors, has, or is characterized as having, a toxicological orhealth-related impact on our environment, customers or employees could subject us to additional legal claims. These proceedings and anysuch additional claims may be costly and may require a substantial amount of management attention, which may have an adverse affect on ourfinancial condition and results of operations. See "Business�Government Regulations and Environmental Matters" and "Business�LegalProceedings."

Upon completion of this offering, we will have a substantial amount of debt, which could adversely affect our financial condition, limit ourability to pursue business opportunities, reduce our operating flexibility or put us at a competitive disadvantage.

As of September 30, 2005, after giving effect to the pro forma adjustments set forth in "Unaudited Pro Forma Combined FinancialStatements," we would have had approximately $548.0 million of long-



18



term debt and $284.2 million of combined stockholders' equity. Our substantial amount of debt could have important consequences for us. Forinstance, it could:

�� require us to use a substantial portion of our cash flow from operations for debt service and reduce the availability of our cashflow to fund working capital, capital expenditures, acquisitions and other general corporate activities;

�� limit our ability to obtain financing for working capital, capital expenditures, acquisitions or other general corporate activitiesin the future;

�� expose us to greater interest rate risk because the interest rates on our senior credit facility will vary; and

�� impair our ability to successfully withstand a downturn in our business or the economy in general and place us at adisadvantage relative to our less-leveraged competitors.

Our separation agreements, the senior secured credit facility and the indenture governing the unsecured notes will limit, but will notprohibit, us from incurring additional debt, and we may incur additional debt in the future. If we incur additional debt, our ability to satisfy ourdebt obligations may become more limited.

The terms of the senior secured credit facility and the indenture governing the unsecured notes will contain a number of restrictive andfinancial covenants that could limit our ability to pay dividends or to operate effectively in the future. If we are unable to comply with thesecovenants, our lenders could accelerate the repayment of our indebtedness.

The terms of the senior secured credit facility and the indenture governing the unsecured notes will subject us to a number of covenantsthat will impose significant operating restrictions on us, including on our ability to incur indebtedness and liens, make loans and investments,make capital expenditures, sell assets, engage in mergers, consolidations and acquisitions, enter into transactions with affiliates, enter into saleand leaseback transactions, make optional payments or modifications of the unsecured notes or other material debt, change our lines ofbusiness and pay dividends on our common stock. We will also be required by the terms of the senior secured credit facility to comply withfinancial covenant ratios that will be calculated by reference to adjusted EBITDA. These restrictions could limit our ability to plan for or reactto market conditions or meet capital needs.

A breach of any of the covenants imposed on us by the terms of our indebtedness, including the financial covenants in the senior securedcredit facility, could result in a default under such indebtedness. In the event of a default, the lenders under the revolving credit facility couldterminate their commitments to us, and they and the lenders of our other indebtedness could accelerate the repayment of all of ourindebtedness. In such case, we may not have sufficient funds to pay the total amount of accelerated obligations, and our lenders under thesenior secured credit facility could proceed against the collateral securing the facility. Any acceleration in the repayment of our indebtednessor related foreclosure could adversely affect our business.

We have experienced net losses in recent years. Our business, financial condition and results of operations could be adversely affected ifthis continues.

We have experienced net losses of $127.6 million, $92.7 million and $97.3 million for the fiscal years ended December 31, 2004, 2003and 2002, respectively. To the extent that we continue to experience net losses, there may be adverse consequences to our business, financialcondition and results of operations. For example, continuing to experience net losses may impair our long-term ability to continue operationsat present levels and may impair our ability to meet our obligations with regard to environmental remediation and restoration. Although ourfinancial performance has improved in the first nine months of 2005, there is no guarantee that our performance will continue to improve atthe same rate, if at all.



19



Market conditions and cyclical factors that adversely affect the demand for the end-use products that contain our titanium dioxide couldadversely affect our results.

Historically, regional and world events that negatively affect discretionary spending or economic conditions generally, such as terroristattacks, the incidence or spread of contagious diseases (such as SARS), or other economic, political, or public health or safety conditions, haveadversely affected demand for the finished products that contain titanium dioxide and from which we derive substantially all of our revenue.Events such as these are likely to contribute to a general reluctance by the public to purchase "quality of life" products, which could cause adecrease in demand for our chemicals and, as a result, may have an adverse effect on our results of operations and financial condition.

Additionally, the demand for titanium dioxide during a given year is subject to seasonal fluctuations. Titanium dioxide sales are generallyhigher in the second and third quarters of the year than in the other quarters due in part to the increase in paint production in the spring to meetdemand resulting from the spring and summer painting season in North America and Europe. We may be adversely affected by existing orfuture cyclical changes, and such conditions may be sustained or further aggravated by anticipated or unanticipated changes in regionalweather conditions. For example, poor weather conditions in a region can lead to an abbreviated painting season, which can depress consumersales of paint products that use titanium dioxide pigment.

Our business, financial condition and results of operations could be adversely affected by global and regional economic downturns andother conditions.

We have significant production, sales and marketing operations throughout the United States, Europe and the Asia-Pacific region, withmore than 1,100 customers in over 100 countries. We also purchase many of the raw materials used in the production of our products inforeign jurisdictions. In 2004, approximately 45% of our total revenues were generated from sales outside of the United States. Due to thesefactors, our performance, particularly the performance of our pigment segment, is cyclical and tied closely to general economic conditions,including global gross domestic product. As a result, our business, financial condition and results of operations are vulnerable to political andeconomic conditions affecting global gross domestic product and the countries in which we operate. For example, from 2000 through 2003,our business was affected when the titanium dioxide industry experienced a period of unusually weak business conditions as a result of avariety of factors, including the global economic recession, exceptionally rainy weather conditions in Europe and the Americas, and theoutbreak of SARS in Asia. Based on these factors, global and regional economic downturns and other conditions may have an adverse effecton our financial condition and results of operations.

Our results of operations may be adversely affected by fluctuations in currency exchange rates.

The financial condition and results of operations of our operating entities in the European Union, among other jurisdictions, are reportedin various foreign currencies and then translated into U.S. dollars at the applicable exchange rate for inclusion in the financial statements. As aresult, any appreciation of the U.S. dollar against these foreign currencies will have a negative impact on our reported sales and operatingmargin (and conversely, the depreciation of the dollar against these foreign currencies will have a positive impact). In addition, our operatingentities often need to convert currencies they receive for our products into currencies in which they purchase raw materials or pay for services,which could result in a gain or loss depending on fluctuations in exchange rates. Because we have significant operations in Europe andAustralia, we are exposed primarily to fluctuations in the euro and the Australian dollar.

In the past, we have sought to minimize our foreign currency translation risk by engaging in hedging transactions. We may be unable toeffectively manage our foreign currency translation risk, and any volatility in foreign currency exchange rates may have an adverse effect onour financial condition or results of operations. For a further discussion of how we manage our foreign currency risk, see

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"Management's Discussion and Analysis of Financial Condition and Results of Operations�Quantitative and Qualitative Disclosure aboutMarket Risk�Foreign Currency Exchange Rate Risk."

Our industry and the end-use markets in which we compete are highly competitive. This competition may adversely affect our results ofoperations.

Each of the markets in which we compete is highly competitive. Competition is based on a number of factors such as price, productquality and service. We face significant competition from major international producers, such as E.I. du Pont de Nemours and Company,Millennium Chemicals Inc., Huntsman Corporation and Kronos Worldwide, Inc., as well as smaller regional competitors. Our most significantcompetitors include major chemicals and materials manufacturers and diversified companies, a number of which have substantially largerfinancial resources, staffs and facilities than we do. The additional resources and larger staffs and facilities of such competitors may give thema competitive advantage when responding to market conditions and capitalizing on operating efficiencies. Increased competition could resultin reduced sales, which could adversely affect our profitability. See "Business�Competitive Conditions."

In addition, within the end-use markets in which we compete, competition between products is intense. We face substantial risk thatcertain events, such as new product development by our competitors, changing customer needs, production advances for competing productsor price changes in raw materials, could cause our customers to switch to our competitor's products. If we are unable to develop and produceor market our products to compete effectively against our competitors, our results of operations may suffer.

Fluctuations in costs of our raw materials or our access to supplies of our raw materials could have an adverse effect on our results ofoperations.

In 2004, raw materials used in the production of titanium dioxide constituted approximately 31% of our operating expenses and 33% ofour cost of products sold. Titanium-bearing ores, in particular, represented more than 22% of our cost of products sold in 2004.

Costs of many of the raw materials we use may fluctuate widely for a variety of reasons, including changes in availability, major capacityadditions or reductions or significant facility operating problems. These fluctuations could negatively affect our operating margins and ourprofitability. As these costs rise, our operating expenses likely will increase and could adversely affect our business, especially if we areunable to pass price increases in raw materials through to our customers.

Should our vendors not be able to meet their contractual obligations or should we be otherwise unable to obtain necessary raw materials,we may incur higher costs for raw materials or may be required to reduce production levels, which may have an adverse effect on our financialposition, results of operations or liquidity. For a further discussion, see "Business�Raw Materials."

The labor and employment laws in many jurisdictions in which we operate are more restrictive than in the United States. Our relationshipwith our employees could deteriorate, which could adversely affect our operations.

In the United States, approximately 200 employees at our Savannah, Georgia facility are members of a union and are subject to acollective bargaining arrangement that is scheduled to expire in April 2006. Approximately 40% of our employees are employed outside theUnited States. In certain of those countries, such as Australia and the member states of the European Union, labor and employment laws aremore restrictive than in the United States and, in many cases, grant significant job protection to employees, including rights on termination ofemployment. For example, in Germany and the Netherlands, by law some of our employees are represented by a works' council, whichsubjects us to employment arrangements very similar to collective bargaining agreements.

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We are required to consult with and seek the consent or advice of the unions or works' councils that represent our employees for certainof our activities. This requirement could have a significant impact on our flexibility in managing costs and responding to market changes.Furthermore, there can be no assurance that we will be able to negotiate labor agreements with our unionized employees in the future onsatisfactory terms. If those employees were to engage in a strike, work stoppage or other slowdown, or if any of our other employees were tobecome unionized, we could experience a significant disruption of our operations or higher ongoing labor costs, which could adversely affectour financial condition and results of operations.

Third parties may claim that our products or processes infringe their intellectual property rights, which may cause us to pay unexpectedlitigation costs or damages or prevent us from making, using, or selling our products.

Although currently there are no pending or threatened proceedings or claims relating to alleged infringement, misappropriation, orviolation of the intellectual property rights of others, we may be subject to legal proceedings and claims in the future in which third partiesallege that their patents or other intellectual property rights are infringed, misappropriated or otherwise violated by us or by our products orprocesses. In the event that any such infringement, misappropriation, or violation of the intellectual property rights of others is found, we mayneed to obtain licenses from those parties or substantially re-engineer our products or processes in order to avoid such infringement,misappropriation, or violation. We might not be able to obtain the necessary licenses on acceptable terms or be able to re-engineer ourproducts or processes successfully. Moreover, if we are found by a court of law to infringe, misappropriate, or otherwise violate theintellectual property rights of others, we could be required to pay substantial damages or be enjoined from making, using, or selling theinfringing products or technology. We also could be enjoined from making, using, or selling the allegedly infringing products or technologypending the final outcome of the suit. Any of the foregoing could adversely affect our financial condition and results of operations.

If we are not able to continue our technological innovation and successful commercial introduction of new products, our profitabilitycould be adversely affected.

Our industries and the end-use markets into which we sell our products experience periodic technological change and productimprovement. Our future growth will depend on our ability to gauge the direction of commercial and technological progress in key end-usemarkets and on our ability to fund and successfully develop, manufacture and market products in such changing end-use markets. We mustcontinue to identify, develop and market innovative products or enhance existing products on a timely basis in order to maintain our profitmargins and our competitive position. We may not be able to develop new products or technology, either alone or with third parties, or licenseintellectual property rights from third parties on a commercially competitive basis. If we fail to keep pace with the evolving technologicalinnovations in our end-use markets on a competitive basis, our financial condition and results of operations could be adversely affected.

If our intellectual property were compromised or copied by competitors, or if competitors were to develop similar intellectual propertyindependently, our results of operations could be negatively affected.

Our success depends to a significant degree upon our ability to protect and preserve our intellectual property rights. Although we ownand have applied for numerous patents and trademarks throughout the world, we may have to rely on judicial enforcement of our patents andother proprietary rights. Our patents and other intellectual property rights may be challenged, invalidated, circumvented, renderedunenforceable, or otherwise compromised. A failure to protect, defend or enforce our intellectual property could have an adverse effect on ourfinancial condition and results of operations.

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We also rely upon unpatented proprietary technology, know-how and other trade secrets to maintain our competitive position. While it isour policy to enter into confidentiality agreements with our employees and third parties to protect our proprietary expertise and other tradesecrets, these agreements may not be enforceable or, even if legally enforceable, we may not have adequate remedies for breaches of suchagreements. The failure of our patents or confidentiality agreements to protect our proprietary technology, know-how or trade secrets couldresult in significantly lower revenues, reduced profit margins or loss of market share.

We may be unable to determine when third parties are using our intellectual property rights without our authorization. We also havelicensed certain of our intellectual property rights to third parties, and we cannot be certain that our licensees are using our intellectualproperty only as authorized by the applicable license agreement. The undetected or unremedied, unauthorized use of our intellectual propertyrights or the legitimate development or acquisition of intellectual property related to our industry by third parties could reduce or eliminate anycompetitive advantage we have as a result of our intellectual property, adversely affecting our financial condition and results of operations. Ifwe must take legal action to protect, defend or enforce our intellectual property rights, any suits or proceedings could result in significant costsand diversion of our resources and our management's attention, and 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.

We may need additional capital in the future and may not be able to obtain it on favorable terms, if at all.

Our industry is highly capital intensive and our success depends to a significant degree on our ability to develop and market innovativeproducts and to update our facilities and process technology. As a stand-alone company, we will not be able to rely on Kerr-McGee to fundour capital requirements. We may require additional capital in the future to finance our future growth and development, implement furthermarketing and sales activities, fund our ongoing research and development activities and meet our general working capital needs. Our capitalrequirements will depend on many factors, including acceptance of and demand for our products, the extent to which we invest in newtechnology and research and development projects, and the status and timing of competitive developments. Additional financing may not beavailable when needed on terms favorable to us or at all. Further, the terms of the senior secured credit facility and the indenture governing theunsecured notes, as well as our agreements with Kerr-McGee, may limit our ability to incur additional indebtedness or issue additional sharesof our common stock. If we are unable to obtain adequate funds on acceptable terms, we may be unable to develop or enhance our products,take advantage of future opportunities or respond to competitive pressures, which could harm our business.

We are a holding company and depend on the performance of our subsidiaries and their ability to make distributions to us.

We are a holding company and do not conduct any business operations of our own. Our principal assets are the equity interests we own inour operating subsidiaries, either directly or indirectly. As a result, we are dependent upon cash dividends, distributions or other transfers wereceive from our subsidiaries in order to make dividend payments to our stockholders, to repay any debt we may incur, and to meet our otherobligations. The ability of our subsidiaries to pay dividends and make payments to us will depend on their operating results and may berestricted by, among other things, applicable corporate, tax and other laws and regulations and agreements of those subsidiaries, as well as bythe terms of the senior secured credit facility and the indenture governing the unsecured notes. For example, state corporate law applicable toseveral of our principal subsidiaries generally prohibits the payment of dividends by any subsidiary unless the subsidiary has a capital surplusor net profits in the current or immediately preceding fiscal year. Payments or distributions from our subsidiaries also could be subject torestrictions on dividends or repatriation of earnings under applicable local law, monetary

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transfer restrictions and foreign currency exchange regulations in the jurisdictions in which our subsidiaries operate. Our subsidiaries areseparate and distinct legal entities. Any right that we have to receive any assets of or distributions from any subsidiary upon its bankruptcy,dissolution, liquidation or reorganization, or to realize proceeds from the sale of the assets of any subsidiary, will be junior to the claims ofthat subsidiary's creditors, including trade creditors.

Various factors may hinder the declaration and payment of dividends.

The payment of dividends is subject to the terms of our concurrent financing transactions, as well as to the discretion of our board ofdirectors, and various factors may cause the board to determine not to pay dividends. Such factors include our financial condition, ourearnings and cash flows, our capital requirements, contractual restrictions and such other factors as our board of directors may considerrelevant. See "Dividend Policy." In addition, our assets consist primarily of investments in our operating subsidiaries. Our cash flow andability to pay dividends depend upon cash dividends and distributions or other transfers from our subsidiaries. See "�We are a holdingcompany and depend on the performance of our subsidiaries and their ability to make distributions to us."

Risks Related to Our Relationship with Kerr-McGee

Our historical financial information may not be representative of our results as a stand-alone company and, therefore, may not be reliableas an indicator of our future financial results.

The historical financial information we have included in this prospectus has been derived from Kerr-McGee's accounting records. Webelieve that the assumptions underlying the combined financial statements are reasonable. However, the historical combined financialstatements may not reflect what our results of operations, financial position and cash flows would have been had we been a stand-alonecompany during the periods presented or what our results of operations, financial position and cash flows will be in the future.

In particular, the historical combined financial statements reflect allocations for corporate functions historically provided by Kerr-McGee, including general corporate expenses and employee benefits. These allocations were based on what Kerr-McGee considered to bereasonable reflections of the historical utilization levels of these services required in support of our business and may be less than the expenseswe will incur in the future as a stand-alone company. For example, we currently estimate that general annual corporate expenses will increaseby approximately $20.0 to $25.0 million when we become a stand-alone company. In addition, we have not made adjustments to our historicalfinancial information to reflect changes that may occur in our cost structure, financing and operations as a result of our separation from Kerr-McGee, including changes resulting from no longer being a member of a consolidated group for tax purposes. These changes potentiallyinclude increased costs associated with reduced economies of scale.

For additional information about our past financial performance and the basis of the presentation of the historical combined financialstatements, please see "Selected Historical Combined Financial Data," "Management's Discussion and Analysis of Financial Condition andResults of Operations" and the combined financial statements and notes to the combined financial statements included elsewhere in thisprospectus.

As long as Kerr-McGee owns shares of our common stock representing a majority of the voting power of our common stock, it will controlus and the influence of our other stockholders over significant corporate actions will be limited.

Upon the closing of this offering, Kerr-McGee will own all of our Class B common stock, which will represent a majority of thecombined voting power of all outstanding classes of our common stock. As a result, Kerr-McGee will be entitled to nominate a majority of ourboard of directors and will have the ability to control the vote in any election of directors. Kerr-McGee will also have control over our

24



decisions to enter into significant corporate transactions and, in its capacity as our majority stockholder, will have the ability to prevent anytransactions that it does not believe are in Kerr-McGee's best interest. As a result, Kerr-McGee will be able to control, directly or indirectlyand subject to applicable law, all matters affecting us, including the following:

�� any determination with respect to our business direction and policies, including the appointment and removal of officers;

�� any determinations with respect to mergers, business combinations or dispositions of assets;

�� our capital structure;

�� compensation, option programs and other human resources policy decisions;

�� changes to other agreements that may adversely affect us; and

�� the payment of dividends on our common stock.

The interim services provided to us by Kerr-McGee may not be sufficient to meet our needs, and we may not be able to replace theseservices after our agreements with Kerr-McGee expire.

Historically, Kerr-McGee performed various corporate functions on our behalf, including the following:

�� accounting services;

�� tax services;

�� employee benefits management;

�� financial services;

�� legal services;

�� risk and claims management;

�� information management and technology services;



�� real estate management;

�� travel services; and

�� office administration services.

Following the completion of this offering, Kerr-McGee will have no obligation to provide any services on our behalf other than asprovided in our transition services agreement with Kerr-McGee. See "Arrangements between Kerr-McGee and Our Company�TransitionServices Agreement." We are in the process of creating our own, or engaging third parties to provide, systems and business functions toreplace many of the systems and business functions Kerr-McGee provides us. However, we may not be successful in implementing thesesystems and business functions or in transitioning data from Kerr-McGee's systems to ours. If we do not have in place our own systems andbusiness functions or if we do not have agreements with other providers of these services when our transition services agreement with Kerr-McGee expires, we may not be able to effectively operate our business and our profitability may be affected adversely.

We will qualify for, and intend to rely on, exemptions from the New York Stock Exchange corporate governance requirements.

Upon the closing of this offering, Kerr-McGee will continue to control a majority of the voting power of our outstanding common stock.As a result, we are a "controlled company" within the meaning of the New York Stock Exchange corporate governance standards. Under theNew York Stock

25



Exchange rules, a "controlled company" may elect not to comply with the following corporate governance requirements:

�� a majority of independent directors on the board of directors;

�� a nominating and corporate governance committee composed entirely of independent directors;

�� a compensation committee composed entirely of independent directors; and

�� an annual performance evaluation of the nominating and corporate governance and compensation committees.

Following this offering and until such time that we cease to be a "controlled company," we intend to utilize these exemptions. As a result,we will not have a majority of independent directors and our nominating and corporate governance and compensation committees will notconsist entirely of independent directors. Additionally, we are relying on a transition provision for the New York Stock Exchange standardsrelating to the independence of audit committees. That transition provision allows issuers, such as us, that have a registration statement underthe Securities Act covering an initial public offering of securities to (1) exempt all but one of our audit committee members from theindependence requirements for 90 days from the effective date of our registration statement, and (2) exempt a minority of the members of ouraudit committee from the independence requirement for one year from the effective date of our registration statement.

Accordingly, you will not have the same protection afforded to stockholders of companies that are subject to all of the New York StockExchange corporate governance requirements.

Provisions in our agreements with Kerr-McGee may discourage, delay or prevent us from incurring additional indebtedness, issuingadditional shares of our stock or entering into any transaction that would result in a change of control.

Under our master separation agreement, from the completion of the Transactions until the completion of the Distribution, we may notincur indebtedness for borrowed money, other than pursuant to the revolving credit facility, without Kerr-McGee's consent. In addition, whileKerr-McGee owns at least a majority of our outstanding common stock, we are restricted from issuing any shares of our capital stock, or anyrights, warrants or options to acquire our capital stock (other than any shares of our capital stock or options to acquire our capital stock grantedin connection with the performance of services), if this would cause Kerr-McGee to own less than a majority of our outstanding commonstock (on a fully diluted basis). In these circumstances, we also are restricted from issuing any shares of our capital stock if this would causeKerr-McGee to own less than 80% of the total voting power of our outstanding capital stock entitled to vote generally in the election of ourdirectors and from issuing any shares of non-voting stock. See "Arrangements between Kerr-McGee and Our Company�Master SeparationAgreement."

In addition, under our tax sharing agreement with Kerr-McGee, if we enter into transactions during the period ending two years followingthe Distribution which result in the issuance or acquisition of our shares, and the Internal Revenue Service subsequently determines thatSection 355(e) of the Internal Revenue Code is applicable to the Distribution, we will be required to indemnify Kerr-McGee for any resultingtax liability incurred by it. We would also be required to indemnify Kerr-McGee for any tax that would result from any transaction we enterinto that prevents Kerr-McGee from distributing "control" of us, as defined under Section 368(c) of the Internal Revenue Code, in theDistribution. See "Arrangements between Kerr-McGee and Our Company�Tax Sharing Agreement."

These obligations may discourage, delay or prevent us from incurring additional indebtedness or issuing additional shares of our stock,even if we need additional financing, or from entering into a transaction that would result in a change of control. See "Arrangements betweenKerr-McGee and Our

26



Company�Tax Sharing Agreement�Tax Limitations on Additional Issuances of Our Stock and Other Transactions."

The Distribution may not occur, and we may not achieve the expected benefits of the Distribution.

Kerr-McGee has advised us that, subject to the terms of its agreement with the underwriters (as discussed in "Underwriting�Lock-UpAgreements"), following completion of this offering it intends to distribute all of our Class B common stock that it owns to its stockholders.However, Kerr-McGee is not required to complete the Distribution and may decide in its sole discretion not to effect the Distribution. If theDistribution does not occur, or even if it does occur, we may not obtain the benefits we expect as a result of our separation from Kerr-McGee.In addition, until the Distribution occurs, the risks relating to Kerr-McGee's control of us and the potential conflicts of interest between Kerr-McGee and us will continue to be relevant to our stockholders. See "�As long as Kerr-McGee owns shares of our common stock representinga majority of the voting power of our common stock, it will control us and the influence of our other stockholders over significant corporateactions will be limited." and "�Our executive officers and directors may have conflicts of interest because of their ownership of common stockof, and other ties to, Kerr-McGee."

Our executive officers and directors may have conflicts of interest because of their ownership of common stock of, and other ties to, Kerr-McGee.

Two of our directors are officers of Kerr-McGee. These directors will have fiduciary duties to both companies and may have conflicts ofinterest on matters affecting both us and Kerr-McGee, which, in some circumstances, may have interests adverse to our interests. In addition,all of our executive officers and the majority of our directors own common stock of Kerr-McGee or options to purchase common stock ofKerr-McGee. Ownership of such common stock or options could create, or appear to create, potential conflicts of interest when directors andofficers are faced with decisions that could have different implications for Kerr-McGee and us.

Our separation agreements with Kerr-McGee may be less favorable to us than if they had been negotiated with unaffiliated third parties.

We will enter into our separation agreements with Kerr-McGee while we are a wholly-owned subsidiary of Kerr-McGee. If theseagreements were negotiated with unaffiliated third parties, they might be more favorable to us. Pursuant to our agreements with Kerr-McGee,we will agree to indemnify Kerr-McGee for, among other matters, liabilities related to the current and past businesses operated by oursubsidiaries and their predecessors, subject to limited exceptions for which Kerr-McGee has expressly assumed liability. See "ArrangementsBetween Kerr-McGee and Our Company" for a description of these obligations. The allocation of assets and liabilities between Kerr-McGeeand us may not reflect the allocation that would have been reached by two unaffiliated parties.

Risks Related to This Offering

There is no existing market for our Class A common stock, and an active trading market may not develop or the price of our Class Acommon stock may decline.

Prior to this offering, there has been no public market for our Class A common stock and there can be no assurance that an active tradingmarket will develop and continue upon completion of this offering. You may be unable to resell your shares at or above the initial publicoffering price, which will be determined by negotiations between the underwriters and us and may not be indicative of the market price for ourClass A common stock after the initial public offering. Factors that could affect our market price include the following:

�� variations in our actual or anticipated operating results;

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�� failure to meet expectations of securities analysts and investors;

�� changes in financial estimates or publication of research reports by securities analysts;

�� fluctuations in the prices and trading volumes of the stock of chemical companies; and

�� conditions or developments in the chemical industry, including regulatory actions.

These factors may decrease the market price of our Class A common stock regardless of our actual operating performance. In addition, thestock markets in general have experienced extreme volatility that has at times been unrelated to the operating performance of particularcompanies. These broad market fluctuations may also result in a lower trading price of our Class A common stock. The market price of ourClass A common stock could also be affected by additional sales or other distributions of our common stock. See "�Our share price maydecline as a result of additional sales or other distributions of our common stock."

Because of differences in voting power and liquidity between our Class A common stock and our Class B common stock, the market priceof our Class A common stock may be less than the market price of our Class B common stock following Kerr-McGee's distribution of ourClass B common stock.

Following the completion of this offering, Kerr-McGee has advised us that, subject to the terms of its agreement with the underwriters (asdiscussed in "Underwriting�Lock-Up Agreements"), it intends to distribute its shares of our Class B common stock to its stockholders. Afterthe Distribution, the Class B common stock will be publicly traded. As a result of the Distribution as currently contemplated by Kerr-McGee,there will be more shares of Class B common stock than Class A common stock outstanding, which will cause the Class B common stock tobe more liquid than the Class A common stock. In addition, the Class B common stock will have greater voting power per share than theClass A common stock. As a result, investors may prefer the Class B common stock as a means of investing in our company, and the Class Bcommon stock may trade at a higher market price than the Class A common stock. For a further discussion, see "Description of CapitalStock�Authorized Capitalization�Common Stock."

Our share price may decline as a result of additional sales or other distributions of our common stock.

Sales or other distributions of substantial amounts of our common stock after this offering, or the possibility of those sales or otherdistributions, could adversely affect the market price of our Class A common stock and impede our ability to raise capital through the issuanceof equity securities.

After this offering, Kerr-McGee will own all of the outstanding shares of our Class B common stock, representing 56.7% of theoutstanding shares of all classes of our common stock and 88.7% of the total voting power of all classes of our common stock. Kerr-McGeehas advised us that, following completion of this offering, it intends to distribute all of our Class B common stock that it owns to itsstockholders in the Distribution. Kerr-McGee has no contractual obligation to retain its shares of our Class B common stock, except for alimited period described under "Underwriting�Lock-Up Agreements," during which it may not sell or distribute any of its shares of ourClass B common stock without the underwriters' consent until 180 days, or, in the case of the Distribution, 120 days after the date of thisprospectus. Subject to applicable U.S. federal and state securities laws, after the expiration of the applicable waiting period (or before, withconsent of the underwriters to this offering), Kerr-McGee may sell any and all of the shares of our Class B common stock that it beneficiallyowns or distribute any or all of its shares of our Class B common stock, including in the Distribution, to its stockholders. In addition, asdescribed under "Underwriting�Lock-Up Agreements," after a waiting period of 180 days after the date of this prospectus (or before, withconsent of the underwriters), we could issue and sell additional shares of our Class A common stock, subject to our indemnificationobligations under our tax sharing agreement with Kerr-McGee and, if the Distribution is not yet complete, Kerr-McGee's consent. See"Arrangements between Kerr-McGee and Our Company�Master

28



Separation Agreement" and "Arrangements between Kerr-McGee and Our Company�Tax Sharing Agreement�Tax Limitations on AdditionalIssuances of Our Stock and Other Transactions."

Any sale or distribution by Kerr-McGee of our Class B common stock or any sale by us of our Class A common stock in the publicmarket could adversely affect prevailing market prices for the shares of our Class A common stock. See "Shares Eligible for Future Sale" fora discussion of possible future sales or other distributions of our common stock.

You will suffer an immediate and substantial dilution in the book value of your investment.

The initial public offering price per share of our Class A common stock is substantially higher than the net tangible book value per shareof our Class A common stock. Accordingly, if you purchase shares of our Class A common stock in this offering, you will be subject toimmediate and substantial dilution of $14.24 in pro forma net tangible book value per share. See "Dilution."

Provisions of Delaware law, our corporate instruments and our stockholder rights plan may delay or prevent an acquisition of us thatstockholders may consider favorable or may prevent efforts by our stockholders to change our directors or our management, which coulddecrease the value of your shares.

Section 203 of the Delaware General Corporation Law and provisions in our amended and restated certificate of incorporation andamended and restated bylaws could make it more difficult for a third party to acquire us without the consent of our board of directors. See"Description of Capital Stock�Anti-Takeover Effects of Certificate of Incorporation and Bylaws Provisions." These provisions include thefollowing:

�� restrictions on business combinations for a three-year period with a stockholder who becomes the beneficial owner of morethan 15% of our common stock;

�� restrictions on the ability of our stockholders to remove directors;

�� supermajority voting requirements for stockholders to amend our organizational documents; and

�� a classified board of directors.

In addition, our stockholder rights plan imposes a significant penalty on any person or group that acquires, or begins a tender or exchangeoffer that would result in such person acquiring, 15% or more of our outstanding Class A common stock, 15% of our outstanding Class Bcommon stock, or any combination of our Class A common stock and Class B common stock representing 15% or more of the votes of allshares entitled to vote in the election of directors. In such a case, our board of directors has the unrestricted right to authorize the specialissuance of shares of our preferred stock. These restrictions under Delaware law and our stockholder rights plan do not apply to Kerr-McGeewhile it retains at least 15% or more of our Class B common stock. See "Description of Capital Stock�The Rights Agreement."

Although we believe these provisions protect our stockholders from coercive or otherwise unfair takeover tactics and thereby provide anopportunity to receive a higher bid by requiring potential acquirers to negotiate with our board of directors, these provisions apply even if theoffer may be considered beneficial by some stockholders. Further, these provisions may discourage potential acquisition proposals and maydelay, deter or prevent a change of control of our company, including through unsolicited transactions that some or all of our stockholdersmight consider to be desirable. As a result, efforts by our stockholders to change our direction or our management may be unsuccessful.

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

We have made forward-looking statements in this prospectus, which are subject to risks and uncertainties. See "Risk Factors." Thesestatements are based on the beliefs and assumptions of our management and on the information currently available to our management at thetime of such statements. Forward-looking statements include information concerning our possible or assumed future results or otherwise speakto future events and may be preceded by, followed by, or otherwise include the words "believes," "expects," "anticipates," "intends," "plans,""estimates" or similar expressions.

Forward-looking statements are not guarantees of performance. They involve risks, uncertainties and assumptions. Future results orperformance may differ materially from those expressed or implied in these forward-looking statements. Many of the factors that willdetermine these results and values are beyond our ability to control or predict. Potential investors are cautioned not to put undue reliance onany forward-looking statements. Except as required by the Federal securities laws, we do not have any intention or obligation to updateforward-looking statements after we distribute this document, even if new information, future events or other circumstances have made themincorrect or misleading.

You should understand that various factors, in addition to those discussed in "Risk Factors" and elsewhere in this document, could affectour future results and could cause results to differ materially from those expressed in such forward-looking statements, including thefollowing:

�� adverse changes in general economic conditions or in the markets we serve, including changes in the prices of titanium dioxidepigments and other chemicals;

�� changes in our business strategies;

�� demand for consumer products for which our businesses supply raw materials;

�� availability and pricing of raw materials;

�� fluctuations in energy prices;

�� technological changes affecting production of our materials;

�� developments associated with our environmental remediation efforts;

�� hazards associated with chemicals manufacturing;

�� risks associated with competition, including the financial resources of competitors and the introduction of new competingproducts;



�� risks associated with international sales and operations;

�� changes in laws and regulations, including environmental laws, or changes in the administration of such laws and regulations;

�� the quality of future opportunities that may be presented to or pursued by us;

�� the ability to generate cash flows or obtain financing to fund growth and the cost of such financing;

�� the ability to obtain and maintain regulatory approvals;

�� the effect of various litigation that arise from time to time in the ordinary course of business;

�� the impact of weather and the occurrence of natural disasters such as fires, floods and other catastrophic events and naturaldisasters;

�� acts of war or terrorist activities; and

�� the ability to respond to challenges in international markets, including changes in currency exchange rates, political oreconomic conditions, and trade and regulatory matters.

30



USE OF PROCEEDS

We estimate that the net proceeds from the sale of 17,480,000 shares of Class A common stock being offered by this prospectus, afterdeducting estimated underwriting discounts and commissions and estimated offering expenses, will be approximately $316.0 million($363.8 million if the underwriters exercise in full their option to purchase additional shares), assuming the shares are offered at $19.50 pershare, which is the midpoint of the estimated offering price range set forth on the cover page of this prospectus. We estimate that the netproceeds from the term loan facility and the private offering of unsecured notes, after deducting estimated expenses related to thosetransactions, will be approximately $539.0 million. We intend to distribute all of the net proceeds from this offering, the term loan facility andthe private offering of unsecured notes and cash on hand in excess of $40 million to Kerr-McGee. We estimate that the aggregate amount ofdistributions to Kerr-McGee will be approximately $895.0 million ($942.8 million if the underwriters exercise in full their option to purchaseadditional shares). This offering of our Class A common stock, the completion of the private offering of the unsecured notes and the entry intothe senior secured credit facility are conditioned upon one another. As a result, if Tronox Worldwide and Tronox Finance Corp. do notcomplete the offering of the unsecured notes or if Tronox Worldwide does not enter into the senior secured credit facility, this offering of ourClass A common stock will not be completed.

DIVIDEND POLICY

We intend to pay a regular quarterly cash dividend to the holders of our Class A and Class B common stock. Our board of directors willdetermine the payment of future dividends on our Class A and Class B common stock, if any, and the amount of any dividends in light of:

�� any applicable contractual restrictions limiting our ability to pay dividends;

�� our earnings and cash flows;

�� our capital requirements;

�� our financial condition; and

�� other factors our board of directors deems relevant.

Because we are a holding company without our own business operations, we are dependent upon cash dividends, distributions or othertransfers we receive from our subsidiaries in order to make dividend payments on our Class A and Class B common stock. The ability of oursubsidiaries to make dividends, distributions or other transfers to us will depend on their operating results. The terms of the senior securedcredit facility and the indenture governing the unsecured notes will also restrict the ability of our subsidiaries to make such distributions. Theindenture governing the unsecured notes will permit the payment of annual dividends from our subsidiaries to us in an amount per annumequal to up to 6% of the net proceeds of this offering, provided that at the time each such dividend is declared, there is no event of defaultunder the indenture. The senior secured credit facility will permit the payment of quarterly dividends from our subsidiaries to us, subject to aspecified maximum amount, provided that at the time such dividend is declared (and, if paid more than 60 days after declaration, at the time itis paid), we have at least an amount equivalent to such dividend available under the revolving credit facility and there is no event of defaultunder the senior secured credit facility. Our subsidiaries' ability to make dividends, distributions or other transfers to us may be furtherrestricted by applicable corporate, tax and other laws and regulations. State corporate law applicable to several of our principal subsidiariesgenerally prohibits the payment of dividends by any subsidiary unless the subsidiary has a capital surplus or net profits in the current orimmediately preceding fiscal year. Payments or distributions from our subsidiaries also could be subject to restrictions on dividends orrepatriation of earnings under applicable local law, monetary transfer restrictions and foreign currency exchange regulations in thejurisdictions in which our subsidiaries operate. See "Risk Factors�We are a holding company and depend on the performance of our



subsidiaries and their ability to make distributions to us" and "Risk Factors�Various factors may hinder the declaration and payment ofdividends."

31



CAPITALIZATION

The following table sets forth cash and cash equivalents and combined capitalization as of September 30, 2005:

�� on an historical basis; and

�� to give effect to the following pro forma adjustments:

�� the recapitalization of our company prior to the completion of this offering, in which our common stock held by Kerr-McGee will convert into approximately 22.9 million shares of Class B common stock;

�� the receipt of estimated net proceeds from this offering of approximately $316.0 million (assuming an initial offeringprice of $19.50 per share, which is the midpoint of the range set forth on the cover page of this prospectus), estimated netproceeds from the unsecured notes offering of approximately $343.1 million and estimated net proceeds from the termloan facility of approximately $195.9 million, all of which will be distributed to Kerr-McGee;

�� the transfer to us by Kerr-McGee, and the assumption by us, on the effective date of the Distribution, of assets andliabilities related to incentive awards, health and welfare plan benefits, retirement plans and savings plans; and

�� the distribution to Kerr-McGee by us of cash on hand in excess of $40 million.

This table should be read together with "Use of Proceeds," "Selected Historical Combined Financial Data," "Unaudited Pro FormaCombined Financial Statements," "Management's Discussion and Analysis of Financial Condition and Results of Operations" and thecombined financial statements and the notes to those statements, in each case, included elsewhere in this prospectus.

As ofSeptember 30, 2005

HistoricalPro

Forma(millions of dollars)

Cash and cash equivalents $ 76.7 $ 40.0

Current portion of long-term debt(1) � 2.0Long-term debt:

Senior secured credit facility:Revolving credit facility due 2010(2) $ � $ �

Term loan facility due 2011 � 198.0Unsecured notes due 2012 � 350.0

Total long-term debt � 548.0

Business/stockholders' equity:Series A junior participating preferred stock, $0.01 par value per share; 2,000,000 sharesauthorized; no shares issued and outstanding

$ � $ �



Class A common stock, $0.01 par value per share; 100,000,000 shares authorized; no sharesissued and outstanding, historical; 17,480,000 shares issued and outstanding, pro forma(3) � 0.2

Class B common stock, $0.01 par value per share; 100,000,000 shares authorized; 10,000 sharesissued and outstanding, historical; 22,889,431 shares issued and outstanding, pro forma

� 0.2

Additional paid-in capital � 245.2Owner's net investment 979.0 �

Accumulated other comprehensive income 38.6 38.6

Total business/stockholders' equity 1,017.6 284.2

Total capitalization $ 1,017.6 $ 834.2

32



(1)Represents current amortization on the $200 million term loan facility, which is expected to amortize each year in an amount equal to1% per year in equal quarterly installments for the first five years and in an amount equal to 95% in equal quarterly installments for thefinal year.

(2)The revolving credit facility, which will provide for borrowings of up to $250 million, will be undrawn at closing of this offering.

(3)Excludes (a) approximately 0.4 million shares of our Class A common stock issuable upon exercise of stock options, and approximately0.4 million restricted shares of our Class A common stock, in each case, expected to be granted in connection with this offering, and(b) shares of our Class A common stock issuable in connection with the conversion or replacement of Kerr-McGee stock-based awardson the effective date of the Distribution.

33



DILUTION

If you invest in our Class A common stock, your ownership interest will be diluted to the extent of the difference between the initialpublic offering price per share of our Class A common stock and the net tangible book value per share of our common stock after thisoffering. The net tangible book value per share is equal to the amount of our total tangible assets (total assets less intangible assets) less totalliabilities, divided by the total number of shares of our common stock outstanding. Our net tangible book value as of September 30, 2005 wasapproximately $956.7 million, or $41.80 per share based on approximately 22.9 million shares of our Class B common stock that will beoutstanding immediately prior to the completion of this offering. After giving effect to the sale of shares of our Class A common stock in thisoffering, and the other Transactions, as well as the other pro forma adjustments set forth in "Unaudited Pro Forma Combined FinancialStatements," our net tangible book value as of September 30, 2005 would have been approximately $212.3 million, or $5.26 per share. Thisrepresents an immediate dilution in net tangible book value of $14.24 per share to investors purchasing shares of our Class A common stock inthis offering.

The following table illustrates this per share dilution:

Assumed initial public offering price per share $ 19.50Net tangible book value per share as of September 30, 2005 $ 41.80Decrease in net tangible book value per share resulting from the Transactions and theother pro forma adjustments

36.54

Net tangible book value per share resulting from the Transactions and the other pro formaadjustments

5.26

Dilution per share to new investors $ 14.24

The table above assumes no exercise of the underwriters' option to purchase additional shares of our Class A common stock. If theunderwriters fully exercise their option to purchase additional shares of our Class A common stock from us, the number of shares of Class Acommon stock held by new investors will increase to approximately 20.1 million shares, or 49.8% of our total outstanding common stock and14.2% of the total voting power of our common stock. At the same time, the number of shares of Class B common stock owned by Kerr-McGee will be reduced to approximately 20.3 million, or 50.2% of our total outstanding common stock and 85.8% of the total voting power ofour common stock. We intend to distribute the net proceeds we receive from any exercise by the underwriters of their option to purchaseadditional shares to Kerr-McGee. As a result, our net tangible book value per share will not be affected by the underwriters' exercise of theiroption to purchase additional shares.

In connection with this offering, our executive officers, non-employee directors (other than the Kerr-McGee directors) and certainemployees will be awarded initial stock option grants to purchase approximately 0.4 million shares of our Class A common stock andapproximately 0.4 million restricted shares of our Class A common stock pursuant to our long term incentive plan, as further discussed under"Management�Long Term Incentive Plan." The stock option grants will vest over three years, with equal amounts vesting on each anniversaryof the applicable grant date. The exercise price per share of these stock options will be equal to the fair market value of our Class A commonstock on the date of this offering. A total of approximately 0.4 million shares of our restricted stock will be awarded. The restrictions on suchshares will lapse on the third anniversary of the grant date.

Additionally, all unvested Kerr-McGee stock options and shares of restricted Kerr-McGee stock held by our employees on the effectivedate of the Distribution will be converted into stock options to purchase our Class A common stock and restricted shares of our Class Acommon stock, respectively. In addition, unvested Kerr-McGee performance unit awards held by our employees on the effective date of theDistribution will be canceled and replaced with stock options to purchase our Class A common stock or restricted shares of our Class Acommon stock. See "Management�Treatment of Kerr-McGee Stock Options, Restricted Stock and Performance Unit Awards," "Arrangementsbetween Kerr-McGee and Our Company�Employee Benefits Agreement�Kerr-McGee Stock Options and Restricted Stock" and "Arrangementsbetween Kerr-McGee and Our Company�Employee Benefits Agreement�Incentive Plans."



34



SELECTED HISTORICAL COMBINED FINANCIAL DATA

The following table sets forth the selected historical combined financial data as of the dates and for the periods indicated in such table.The selected statement of operations data for the years ended December 31, 2004, 2003 and 2002, and the balance sheet data as ofDecember 31, 2004 and 2003, have been derived from the audited combined financial statements included elsewhere in this prospectus. Theselected statement of operations data for the years ended December 31, 2001 and 2000, and the balance sheet data as of September 30, 2004and December 31, 2002, 2001 and 2000 have been derived from our accounting records and are unaudited. The selected statement ofoperations data for the nine-month periods ended September 30, 2005 and 2004, and the balance sheet data as of September 30, 2005, havebeen derived from the interim unaudited condensed combined financial statements included elsewhere in this prospectus. In the opinion of ourmanagement, the interim unaudited condensed combined financial statements have been prepared on a basis consistent with the auditedcombined financial statements and include all adjustments, consisting only of normal and recurring adjustments, necessary for a fairpresentation of the results for the periods presented. Results of operations for the nine-month period ended September 30, 2005 are notnecessarily indicative of the operating results to be expected for the full fiscal year 2005 or for any future periods.

The selected historical combined financial data presented below should be read together with the combined financial statements and thenotes to those statements and "Management's Discussion and Analysis of Financial Condition and Results of Operations" included elsewherein this prospectus.

Nine Months


2005 2004 2004 2003 2002 2001 2000


Combined Statement of Operations Data:

Net sales $ 1,017.5 $ 939.9 $ 1,301.8 $ 1,157.7 $ 1,064.3 $ 1,022.6 $ 1,114.1

Cost of goods sold 847.6 844.0 1,168.9 1,024.7 949.0 972.5 870.5

Gross margin 169.9 95.9 132.9 133.0 115.3 50.1 243.6

Selling, general and administrative expenses 85.9 80.2 110.1 98.9 84.0 92.2 73.4

Restructuring charges(1) � 112.1 113.0 61.4 11.8 � �

Provision for environmental remediation and restoration, net

of reimbursements17.0 3.6 4.6 14.9 14.3 7.7 6.8

67.0 (100.0) (94.8) (42.2) 5.2 (49.8) 163.4

Interest expense, net(2) (10.9) (6.6) (9.6) (8.9) (11.2) (26.2) (34.0)

Other income (expense)(3) (1.2) (13.4) (15.7) (11.7) (2.0) (13.8) (55.2)

Income (loss) from continuing operations before income

taxes54.9 (120.0) (120.1) (62.8) (8.0) (89.8) 74.2

Income tax benefit (provision) (20.5) 38.1 38.3 15.1 (8.3) 30.7 (37.9)


cumulative effect of change in accounting principle34.4 (81.9) (81.8) (47.7) (16.3) (59.1) 36.3

Loss from discontinued operations, net of income tax benefit (21.8) (45.3) (45.8) (35.8) (81.0) (49.0) (46.3)

Income (loss) before cumulative effect of change in

accounting principle12.6 (127.2) (127.6) (83.5) (97.3) (108.1) (10.0)

Cumulative effect of change in accounting principle, net of

income tax benefit� � � (9.2) � 0.7 �



Net income (loss) $ 12.6 $ (127.2) $ (127.6) $ (92.7) $ (97.3) $ (107.4) $ (10.0)

35



Combined Balance Sheet Data:

Working capital(4) $ 459.1 $ 244.8 $ 240.2 $ 304.5 $ 243.6 $ 264.5 $ 290.8

Property, plant and equipment, net 811.9 866.4 883.0 961.6 944.9 948.9 961.6

Total assets 1,703.0 1,627.5 1,595.9 1,809.1 1,733.6 1,628.1 1,676.0

Noncurrent liabilities:

Environmental remediation and/or restoration 160.6 148.1 130.8 135.9 131.4 40.0 61.3

All other noncurrent liabilities 221.4 257.3 215.9 312.2 192.4 209.6 237.1

Total liabilities 685.4 763.3 706.0 797.9 671.2 556.7 615.0

Total business equity 1,017.6 864.2 889.9 1,011.2 1,062.4 1,071.4 1,061.0

Supplemental Information:

Depreciation and amortization expense $ 78.1 $ 76.9 $ 104.6 $ 106.5 $ 105.7 $ 119.9 $ 92.0

Capital expenditures 51.7 63.7 92.5 99.4 86.7 153.3 117.1

Adjusted EBITDA(5) 180.7 116.7 162.2 160.3 134.5 (not available)(1)

Restructuring charges in 2004 include costs associated with the shutdown of our titanium dioxide pigment sulfate production at our Savannah, Georgia facility.

Restructuring charges in 2003 include costs associated with the shutdown of our synthetic rutile plant in Mobile, Alabama and charges in connection with a work force

reduction program consisting of both voluntary retirements and involuntary terminations. Restructuring charges in 2002 represent a write-down of fixed assets for

abandoned engineering projects.

(2)Includes interest expense allocated to us by Kerr-McGee based on specifically identified borrowings from Kerr-McGee at Kerr-McGee's average borrowing rates. See

note 20 to the audited combined financial statements and note 9 to the interim unaudited condensed combined financial statements, in each case included elsewhere in this

prospectus.

(3)Includes net foreign currency transaction gain (loss), equity in net earnings of equity method investees, loss on accounts receivable sales and other expenses. See note 20 to

the audited combined financial statements and note 9 to the interim unaudited condensed combined financial statements, in each case included elsewhere in this

prospectus.

(4)Working capital is defined as the excess of current assets over current liabilities.

(5)EBITDA represents net income (loss) before net interest expense, income tax benefit (provision), and depreciation and amortization expense. Adjusted EBITDA represents

EBITDA as further adjusted to reflect the items set forth in the table below, all of which will be required in determining our compliance with financial covenants under our

senior secured credit facility. See "Description of Our Concurrent Financing Transactions�Senior Secured Credit Facility."

We have included EBITDA and adjusted EBITDA in this prospectus to provide investors with a supplemental measure of our operating performance and information

about the calculation of some of the financial covenants that will be contained in our new senior secured credit facility. We believe EBITDA is an important supplemental

measure of operating performance because it eliminates items that have less bearing on our operating performance and so highlights trends in our core business that may

not otherwise be apparent when relying solely on GAAP financial measures. We also believe that securities analysts, investors and other interested parties frequently use

EBITDA in the evaluation of issuers, many of which present EBITDA when reporting their results. Adjusted EBITDA is a material component of the covenants that will

be imposed on us by the senior secured credit facility. Under the senior secured credit facility, we will be subject to financial covenant ratios that will be calculated by

reference to adjusted EBITDA. Non-compliance with the financial covenants contained in the senior secured credit facility could result in a default, an acceleration in the

repayment of amounts outstanding, and a termination of the lending commitments under the senior secured credit facility. Any acceleration in the repayment of amounts

outstanding under the senior secured credit facility would result in a default under the indenture governing the unsecured notes. While an event of default under the senior

secured credit facility or the indenture governing the unsecured notes is continuing, we would be precluded from, among other things, paying dividends on our common



stock or borrowing under the revolving credit facility. For a description of required financial covenant levels and actual ratio calculations based on adjusted EBITDA, see

"Management's Discussion and Analysis of Financial Condition and Results of Operations�Financial Condition�Liquidity and Capital Resources Following the

Transactions�Covenant Compliance." Our management also uses EBITDA and adjusted EBITDA in order to facilitate operating performance comparisons from period to

period and prepare annual operating budgets.

EBITDA and adjusted EBITDA are not presentations made in accordance with generally accepted accounting principles, or GAAP. As discussed above, we believe that

the presentation of EBITDA and adjusted EBITDA in this prospectus is appropriate. However, when evaluating our results, you should not consider EBITDA and adjusted

EBITDA in isolation of, or as a substitute for, measures of our financial performance as determined in accordance with GAAP, such as net income (loss). EBITDA and

adjusted EBITDA have material limitations as performance measures because they exclude items that are necessary elements of our costs and operations. Because other

companies may calculate EBITDA and adjusted EBITDA differently than we do, EBITDA may not be, and adjusted EBITDA as presented in this prospectus is not,

comparable to similarly titled measures reported by other companies.

36



The following table reconciles net income (loss) to EBITDA and adjusted EBITDA for the periods presented:

Nine Months

Ended September 30,Year ended December 31,

2005 2004

Pro

Forma

2005

2004 2003 2002

Pro

Forma

2004


Net income (loss)(a) $ 12.6 $ (127.2) $ (9.8) $ (127.6) $ (92.7) $ (97.3) $ (174.2)

Net interest expense 10.9 6.6 30.4 9.6 8.9 11.2 43.2

Income tax provision (benefit) 8.8 (62.4) (3.3) (63.0) (39.3) (35.3) (70.0)

Depreciation and amortization expense 78.1 76.9 78.1 104.6 106.5 105.7 104.6

EBITDA 110.4 (106.1) 95.4 (76.4) (16.6) (15.7) (96.4)

Savannah sulfate facility shutdown costs � 28.7 � 29.0 � � 29.0

Loss from discontinued operations(b) 33.5 69.0 33.5 69.7 51.9 120.1 69.7



Extraordinary, unusual or non-recurring expenses

or losses(c) � � � (0.3) 47.0 � (0.3)

Noncash changes constituting:

(Gain) loss on sales of accounts receivable(d) (0.2) 5.8 (0.2) 8.2 4.8 4.7 8.2

Write-downs of property, plant and equipment

and other assets(e) 8.5 100.4 8.5 104.8 29.3 18.5 104.8

Impairment of intangible assets � 7.4 � 7.4 � � 7.4

Cumulative effect of change in accounting

principle� � � � 14.1 � �

Asset retirement obligations 1.0 � 1.0 � � � �

Other items(f) 10.5 7.9 10.5 15.2 14.9 (7.4) 15.2

Adjusted EBITDA $ 180.7 $ 116.7 $ 165.7 $ 162.2 $ 160.3 $ 134.5 $ 142.2

(a)Net income (loss) includes the following operating losses associated with our Savannah sulfate facility, which was closed in September 2004:

(i) $17.8 million, $18.6 million and $9.6 million for the years ended December 31, 2004, 2003 and 2002, respectively, and (ii) $2.0 million and $16.8 million

for the nine months ended September 30, 2005 and 2004, respectively.

(b)Includes provisions for environmental remediation and restoration, net of reimbursements, related to our former forest products operations, thorium

manufacturing, uranium and refining operations of $61.5 million, $41.1 million and $61.1 million for the years ended December 31, 2004, 2003 and 2002,

respectively, and $20.4 million and $61.9 million for the nine months ended September 30, 2005 and 2004, respectively.

(c)Includes $25.8 million associated with the closure of our Mobile, Alabama facility in 2003 for charges not reflected elsewhere and $21.2 million for a

workforce reduction program for continuing operations in 2003. See note 15 to the audited combined financial statements included elsewhere in this

prospectus.



(d)Loss on the sales of accounts receivable under an asset monetization program, or a factoring program, comparable to interest expense.

(e)Includes $86.6 million associated with the shutdown of our Savannah sulfate facility for the year ended December 31, 2004.

(f)Includes noncash stock-based compensation, noncash pension and postretirement cost and accretion expense.

37



UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS

The unaudited pro forma combined financial statements presented below should be read together with the historical combined financialstatements, the notes to those statements and "Management's Discussion and Analysis of Financial Condition and Results of Operations," ineach case, included elsewhere in this prospectus.

The unaudited pro forma combined financial data for the year ended December 31, 2004 and as of and for the nine-month period endedSeptember 30, 2005 set forth below have been prepared to give effect to this offering and the related transactions described below, as if thosetransactions had occurred on the date or at the beginning of the periods indicated:

�� the recapitalization of our company prior to the completion of this offering, in which our common stock held by Kerr-McGeewill convert into approximately 22.9 million shares of Class B common stock;

�� the issuance and sale of 17,480,000 shares of our Class A common stock in this offering and the receipt of estimated netproceeds of approximately $316.0 million, assuming an initial offering price of $19.50 per share, which is the midpoint of therange set forth on the cover page of this prospectus;

�� the issuance by Tronox Worldwide and Tronox Finance Corp. of $350 million of unsecured notes in a concurrent privateoffering and the receipt of estimated net proceeds from that offering of approximately $343.1 million;

�� the borrowing by Tronox Worldwide of $200 million under the term loan facility and the receipt of estimated net proceeds ofapproximately $195.9 million;

�� the distribution of the net proceeds from this offering, the unsecured notes and the term loan facility to Kerr-McGee;

�� the elimination from the historical combined financial statements of net interest expense allocated to us by Kerr-McGee basedon specifically-identified borrowings;

�� the incremental selling, general and administrative costs resulting from us becoming a stand-alone company;

�� the transfer to us by Kerr-McGee, and the assumption by us, on the effective date of the Distribution, of assets and liabilitiesrelated to incentive awards, health and welfare plan benefits, retirement plans and savings plans;

�� the distribution to Kerr-McGee by us of cash on hand in excess of $40 million; and

�� the change in our income taxes resulting from the transactions described above.



We derived the unaudited pro forma combined financial data from the audited combined financial statements for the year endedDecember 31, 2004 and the interim unaudited condensed combined financial statements as of and for the nine months ended September 30,2005, each of which are included elsewhere in this prospectus. The unaudited pro forma combined financial data are for informationalpurposes only, are not projections of our future financial performance, and should not be considered indicative of actual results that wouldhave been achieved had the transactions actually been consummated on the dates or at the beginning of the periods indicated.

In connection with this offering, our executive officers, non-management directors (other than the Kerr-McGee directors) and certainemployees will be awarded initial stock option grants to purchase shares of our Class A common stock and restricted shares of our Class Acommon stock pursuant to our long term incentive plan. See "Management�Long Term Incentive Plan." Approximately 0.4 million shares ofour Class A common stock will be issuable upon the exercise of these options. Approximately

38



0.4 million restricted shares of our Class A common stock will be awarded. The unaudited pro forma combined financial data does not reflectany adjustments related to the issuance of such options and restricted stock. The unaudited pro forma combined financial data also does notreflect any adjustments for the conversion or replacement of Kerr-McGee stock-based awards held by our employees on the effective date ofthe Distribution to stock-based awards under our long term incentive plan. See "Management�Treatment of Kerr-McGee Stock Options,Restricted Stock and Performance Unit Awards" and "Arrangements between Kerr-McGee and Our Company�Employee BenefitsAgreement�Kerr-McGee Stock Options and Restricted Stock."

Unaudited Pro Forma Condensed Combined Statement of OperationsYear Ended December 31, 2004

Historical Adjustments Pro Forma

(millions of dollars,

except per share amounts)

Net sales $ 1,301.8 $ $ 1,301.8Cost of sales 1,168.9 1,168.9

Gross margin 132.9 � 132.9Selling, general and administrative expenses 110.1 20.0(1) 130.1Restructuring charges 113.0 113.0Provision for environmental remediation and restoration, net ofreimbursements

4.6 4.6

Interest expense, net 9.642.6(9.0

(2)

)(3) 43.2

Other expense 15.7 15.7

Loss from continuing operations before income taxes (120.1) (53.6) (173.7)Income tax benefit (provision) 38.3 7.0 45.3(4)

Loss from continuing operations $ (81.8) $ (46.6) $ (128.4)

Loss from continuing operations per share:Historical basic and diluted (based on 22.9 million sharesoutstanding)

$ (3.57)(5)

Pro forma basic and diluted (based on 40.4 million sharesoutstanding)

$ (3.18)(5)

The accompanying notes to the unaudited pro forma condensed combinedfinancial statements are an integral part of these statements.

39



Unaudited Pro Forma Condensed Combined Statement of OperationsNine Months Ended September 30, 2005

Historical Adjustments Pro Forma

(millions of dollars,

except per share amounts)

Net sales $ 1,017.5 $ $ 1,017.5Cost of sales 847.6 847.6

Gross margin 169.9 � 169.9Selling, general and administrative expenses 85.9 15.0(1) 100.9Provision for environmental remediation and restoration, net ofreimbursements

17.0 17.0

Interest expense, net 10.932.0

(12.5

(2)

)(3) 30.4

Other expense 1.2 1.2

Income (loss) from continuing operations before income taxes 54.9 (34.5) 20.4Income tax benefit (provision) (20.5) 12.1 (8.4)(4)

Income (loss) from continuing operations $ 34.4 $ (22.4) $ 12.0

Income (loss) from continuing operations per share:Historical basic and diluted (based on 22.9 million sharesoutstanding)

$ 1.50(5)

Pro forma basic and diluted (based on 40.4 million sharesoutstanding)

$ 0.30(5)


40



Unaudited Pro Forma Condensed Combined Balance SheetAs of September 30, 2005

Adjustments

Historical

Receipt and

Use of

Proceeds from

this Offering

Other Pro Forma


ASSETSCurrent assets

Cash and cash equivalents $ 76.7 $318.2

(316.0

(9)

)(10)$

(40.0)540.1

(539.0

(6)

(8)

)(8)$ 40.0

Accounts receivable, net of allowance for doubtfulaccounts

303.9 303.9

Inventories 307.8 307.8Prepaid and other assets 35.1 (2.2)(9) (1.1)(8) 31.8Income taxes receivable 0.6 0.6Deferred income taxes 38.4 38.4

Total current assets 762.5 � (40.0) 722.5Property, plant and equipment��net 811.9 811.9Long-term receivables, investments and other assets 67.7 11.0 (8) 80.7

2.0 (13)

Goodwill and other intangible assets 60.9 60.9

Total assets $ 1,703.0 $ � $ (27.0) $ 1,676.0

LIABILITIES AND BUSINESS/STOCKHOLDERS'EQUITYCurrent liabilities

Accounts payable $ 157.8 $ 157.8Income taxes payable 2.1 2.1

Accrued liabilities 143.5 $(11.910.1

)(7)

(12) 141.7

Current portion of long-term debt � 2.0 (8) 2.0

Total current liabilities 303.4 � 0.2 303.6

Noncurrent liabilitiesDeferred income taxes 97.7 97.7Environmental remediation and/or restoration 160.6 160.6Long-term debt � 548.0 (8) 548.0

Other 123.7137.920.3

(12)

(13) 281.9

Total noncurrent liabilities 382.0 � 706.2 1,088.2



Business/stockholders' equitySeries A junior participating preferred stock, $0.01 parvalue per share; 2,000,000 shares authorized; no sharesissued and outstanding

� �

Class A common stock, $0.01 par value per share;100,000,000 shares authorized; 17,480,000 sharesissued and outstanding

� $ 0.2 (9) 0.2

Class B common stock, $0.01 par value per share;100,000,000 shares authorized; 22,889,431 sharesissued and outstanding

� 0.2 (11) 0.2

Additional paid-in capital �315.8

(316.0

(9)

)(10)

(40.011.9

(539.0978.8

(148.0(18.3

)(6)

(7)

)(8)

(11)

)(12)

)(13)

245.2

Owner's net investment 979.0 (979.0)(11) �

Accumulated other comprehensive income 38.6 38.6

Total business/stockholders' equity 1,017.6 � (733.4) 284.2

Total liabilities and business/stockholders'equity

$ 1,703.0 $ � $ (27.0) $ 1,676.0


41



Tronox IncorporatedNotes to the Pro Forma Condensed Combined Financial Statements

(1) Reflects the estimated incremental internal and third-party costs we expect to incur for legal, treasury, information technology,accounting and other services. We expect to incur higher selling, general and administrative costs as a stand-alone company due to lostsynergies from past services provided by Kerr-McGee and regulatory compliance requirements that will be applicable to us as a stand-alone, publicly-traded company.

(2) Represents the estimated interest expense and amortization of debt issuance costs related to (a) the issuance of $350 million of unsecurednotes at an assumed fixed rate of 8.0% per annum, (b) the borrowing by Tronox Worldwide of $200 million under the term loan facilityat the current variable LIBOR rate of 4.3% plus an assumed borrowing margin of 1.75%, which may vary as described below, and(c) the revolving credit facility commitment fees at an assumed rate of .375% per annum. No borrowings under the revolving creditfacility are assumed for any period presented. Actual interest expense we incur in future periods may be higher or lower depending onthe final terms of the senior secured credit facility and unsecured notes, utilization of the revolving credit facility, and, in the case of theterm loan facility, the then-applicable interest rates and margins. Components of the pro forma adjustment to interest expense are asfollows:

Nine Months

ended

September 30,

2005

Year Ended

December 31,

2004


$350 million unsecured notes $ 21.0 $ 28.0$200 million term loan 9.0 12.0Amortization of debt issuance costs 1.3 1.7Commitment fees 0.7 0.9

$ 32.0 $ 42.6

An increase in the interest rate applicable to the unsecured notes of one-eighth of one percent (0.125%) would result in additionalinterest expense of approximately $0.4 million and $0.3 million for the year ended December 31, 2004 and for the nine monthsended September 30, 2005, respectively. An increase in the interest rate applicable to the term loan facility of one-eighth of onepercent (0.125%) would result in additional interest expense of approximately $0.3 million and $0.2 million for the year endedDecember 31, 2004 and the nine months ended September 30, 2005, respectively. The interest rate per annum applicable to loansunder the senior secured credit facility will be measured by reference to, at Tronox Worldwide's option, either LIBOR or analternative base rate, plus a borrowing margin. Base rate loans will be referenced to the higher of the federal funds rate plus 0.50%or the prime rate. We expect the borrowing margins under the senior secured credit facility to vary in 0.25% increments in a rangefrom 1.0% to 2.0% for LIBOR loans and from 0.0% to 1.0% for base rate loans, depending on the credit rating of the senior securedcredit facility.

(3) Represents the elimination of net interest expense from our historical combined statements of operations. For the year endedDecember 31, 2004, the elimination represents net interest expense at a weighted average rate of 3.8% on $238.7 million of borrowingsfrom Kerr-McGee outstanding at December 31, 2004. For the nine months ended September 30, 2005, the elimination is based on aweighted average rate of 4.6% and $274.3 million of borrowings from Kerr-McGee outstanding at September 30, 2005. These



borrowings are reflected in our historical combined balance sheet as a component of owner's net investment in business equity and areassumed to have been repaid with a portion of the net proceeds from the pro forma borrowings. The weighted average interest

42



rates used to determine the pro forma adjustments are based on interest rates implicit in borrowings from Kerr-McGee.

(4) Represents the tax provision for the year ended December 31, 2004 and for the nine months ended September 30, 2005, after givingeffect to the pro forma adjustments discussed above. This represents the tax provision as though we had been a stand-alone companywith our tax attributes from the beginning of each period presented. We have historically generated net operating losses that have beenutilized by Kerr-McGee and will not be available to us to reduce our taxable income in future years. Accordingly, those net operatinglosses are not included in the tax provision shown in these pro forma financial statements.

(5) The computation of pro forma basic and diluted income (loss) from continuing operations per share is based upon the anticipated17,480,000 Class A common shares and 22,889,431 Class B common shares outstanding upon the completion of this offering. Inconnection with this offering, our executive officers, non-management directors (other than the Kerr-McGee directors) and certainemployees will be awarded initial stock option grants to purchase approximately 0.4 million shares of our Class A common stock andapproximately 0.4 million restricted shares of our Class A common stock pursuant to our long term incentive plan. See"Management�Long Term Incentive Plan." These stock options and restricted shares are excluded from the pro forma income (loss) fromcontinuing operations per share computation. The pro forma income (loss) from continuing operations per share computation alsoexcludes shares of our Class A common stock issuable in connection with Kerr-McGee stock-based awards that will be converted into orreplaced by our stock-based awards on the effective date of the Distribution. See "Management�Treatment of Kerr-McGee StockOptions, Restricted Stock and Performance Unit Awards" and "Arrangements between Kerr-McGee and Our Company�EmployeeBenefits Agreement�Kerr-McGee Stock Options and Restricted Stock."

(6) Represents the distribution to Kerr-McGee by us of cash on hand in excess of $40 million.

(7) Represents Kerr-McGee's payment to us for bonuses and other employee incentive awards earned up to date of offering as set forth inthe employee benefits agreement.

(8) Represents the estimated net proceeds from (a) the issuance and sale of $350 million of unsecured notes by Tronox Worldwide and(b) the borrowing by Tronox Worldwide of $200 million under the term loan facility, in each case concurrent with completion of thisoffering and the reclassification of prepaid debt issuance costs to long-term receivables, investments and other assets. We will notreceive any of the net proceeds from the unsecured notes or the term loan facility, all of which has been reflected as a distribution toKerr-McGee. Tronox Worldwide will also enter into a revolving credit facility that will be undrawn at closing. The revolving creditfacility will be available on a revolving basis for general corporate purposes of Tronox Worldwide and its subsidiaries, subject to certainlimitations. See "Management's Discussion and Analysis of Financial Condition and Results of Operations�FinancialCondition�Liquidity and Capital Resources Following the Transactions" and "Description of Our Concurrent Financing Transactions."

(9) Represents the estimated net proceeds from our issuance and sale of 17,480,000 shares of our Class A common stock in this offering atan assumed initial offering price of $19.50 per share, which is the midpoint of the range set forth on the cover page of this prospectus,and the reclassification of prepaid offering costs to additional paid-in capital.

(10) We will not receive any of the net proceeds from the issuance and sale of our Class A common stock, all of which have been reflected asa distribution to Kerr-McGee.

(11) Represents the recapitalization of our company prior to the completion of this offering in which our common stock held by Kerr-McGeewill be converted into 22,889,431 shares of Class B



43



common stock. In connection with our recapitalization, the amount of Kerr-McGee's net investment in our company has beenreclassified to "Additional paid-in capital."

(12) Represents the assumption on the effective date of the Distribution of the post-retirement health care benefit obligation of $148.0 millionrelating to all eligible retired and active vested participants, as set forth in the employee benefits agreement. The estimated post-retirement benefit obligation is determined based on an assumed discount rate of 5.5% and the health care cost trend rates of 10% for therest of 2005, gradually declining to 5% in the year 2010 and thereafter. This estimated obligation reflects our current expectation ofspecific employees and retirees for which we will assume an obligation. The obligation actually assumed following the Distribution willbe measured based on assumptions applicable as of that date.

(13) Represents (a) the assumption on the effective date of the Distribution of the U.S. tax-qualified defined benefit retirement plan obligationof $442.3 million relating to all eligible employees and former employees and the receipt of $427.9 million in cash or other assets into aqualifying trust, as set forth in the employee benefits agreement, (b) the assumption on the effective date of the Distribution of the U.S.defined benefit non-qualified deferred compensation plan obligation of $5.9 million relating to current and former employees and (c) thereceipt of $2.0 million in cash or other assets as set forth in the employee benefits agreement. The benefit plan obligation of$442.3 million associated with the U.S. tax-qualified retirement plan was determined based on an assumed discount rate of 5.5% and rateof compensation increases of 4.5%. Additionally, the estimate is associated with specifically identified employees and retirees for whomwe currently expect to assume an obligation. The value of the obligation actually assumed will be determined using assumptionsapplicable as of the effective date of the Distribution.

44



MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIALCONDITION AND RESULTS OF OPERATIONS

We are currently an indirect wholly-owned subsidiary of Kerr-McGee Corporation and were formed on May 17, 2005 to hold Kerr-McGee's chemical business. Kerr-McGee's chemical business currently is operated by Tronox Worldwide and its subsidiaries, includingTronox LLC and various European subsidiaries. Prior to the closing of this offering, Kerr-McGee will transfer Tronox Worldwide to us. Untilthat transfer occurs, we will have no material assets or operations. This prospectus, including the combined financial statements and thefollowing discussion, describes us and our financial condition and operations as if we held the subsidiaries that will be transferred to us priorto closing for all historical periods presented. The following discussion should be read in conjunction with the selected historical combinedfinancial data and the combined financial statements and the related notes included elsewhere in this prospectus. The matters discussed belowmay contain forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from thosediscussed in these forward-looking statements. Factors that could cause or contribute to these differences include, but are not limited to, thosediscussed below and elsewhere in this prospectus, particularly in "Risk Factors" and "Special Note Regarding Forward-Looking Statements."

Overview

We are the world's third largest producer and marketer of titanium dioxide based on reported industry capacity by the leading titaniumdioxide producers, and we have an estimated 13% market share of the $9 billion global market in 2004 based on reported industry sales. Wealso produce and market electrolytic manganese dioxide and sodium chlorate, as well as boron-based and other specialty chemicals. Weoperate seven production facilities and have direct sales and technical service organizations in the United States, Europe and the Asia-Pacificregion. We have approximately 2,150 employees worldwide and more than 1,100 customers located in over 100 countries. In 2004, we hadnet sales of $1.3 billion, a net loss of $127.6 million and adjusted EBITDA of $162.2 million. For the first nine months of 2005, we had netsales of $1.0 billion, net income of $12.6 million and adjusted EBITDA of $180.7 million. For a reconciliation of adjusted EBITDA to netincome (loss), see "Prospectus Summary�Summary Historical and Pro Forma Combined Financial Data."

Our business has two reportable segments: pigment and electrolytic and other chemical products. Our pigment segment, which accountedfor approximately 93% of our net sales in 2004, primarily produces and markets titanium dioxide pigment. Performance of our pigmentsegment is cyclical and tied closely to general economic conditions, including global gross domestic product. Events that negatively affectdiscretionary spending also may negatively affect demand for finished products that contain titanium dioxide. Our pigment segment also isaffected by seasonal fluctuations in the demand for coatings, the largest end-use market for titanium dioxide. From 2000 through 2003, thetitanium dioxide industry experienced a period of unusually weak business conditions as a result of a variety of factors, including the globaleconomic recession, exceptionally rainy weather conditions in Europe and the Americas and the outbreak of SARS in Asia. However, globaleconomic conditions generally improved in late 2004, driving increased demand, and, in the last half of 2004 and early 2005, increased prices.No major titanium dioxide plant construction projects have commenced, and we expect the industry's current high capacity utilization rates tocontinue in the near term and believe that industry dynamics show a sustainable improving trend.

Due to the nature of our current and former operations, we have significant environmental remediation obligations and are subject tolegal and regulatory liabilities. Former operations include, among others, operations involving the production of ammonium perchlorate,treatment of forest products, the refining and marketing of petroleum products, offshore contract drilling and the mining, milling andprocessing of nuclear materials. For example, we have liabilities relating to the remediation of various sites at which chemicals such ascreosote, perchlorate, low-level radioactive substances, asbestos and other materials have been used or disposed. As of September 30, 2005,we had reserves in

45



the amount of $239.4 million for environmental matters and receivables for reimbursement for such matters of $52.5 million. During the firstnine months of 2005, we provided $37.4 million (net of reimbursements) for environmental remediation and restoration costs, of which$20.4 million related to discontinued operations. We had $42.4 million of expenditures associated with our environmental remediationprojects, and received $69.9 million in third-party reimbursements in the first nine months of 2005.

Pursuant to the master separation agreement, Kerr-McGee has agreed to reimburse us for a portion of the environmental remediationcosts we incur and pay after the completion of this offering. The reimbursement obligation extends to costs incurred at any site associated withany of our former businesses or operations. With respect to any site for which a reserve has been established as of the effective date of themaster separation agreement, 50% of the remediation costs we incur and pay in excess of the reserve amount (subject to a minimum thresholdamount) will be reimbursable by Kerr-McGee, net of any amounts recovered or, in our reasonable and good faith estimate, that will berecovered from third parties. With respect to any site for which a reserve has not been established as of the effective date of the masterseparation agreement, 50% of the amount of the remediation costs we incur and pay (subject to a minimum threshold amount) will bereimbursable by Kerr-McGee, net of any amounts recovered or, in our reasonable and good faith estimate, that will be recovered from thirdparties. Kerr-McGee is only required to reimburse us for costs we actually incur and pay during the seven-year period following completion ofthis offering, up to a maximum aggregate amount of $100 million. Kerr-McGee's reimbursement obligation is subject to various otherlimitations and restrictions.

Basis of Presentation

The combined financial statements included elsewhere in this prospectus have been derived from the accounting records of Kerr-McGee,principally representing Kerr-McGee's Chemical�Pigment and Chemical�Other reportable segments. We have used the historical results ofoperations, and historical basis of assets and liabilities of the subsidiaries we will own and the chemical business we will operate aftercompletion of this offering, to prepare the combined financial statements.

The combined statement of operations included elsewhere in this prospectus includes allocations of costs for corporate functionshistorically provided to us by Kerr-McGee, including:

General Corporate Expenses. Represents costs related to corporate functions such as accounting, tax, treasury, human resources, legaland information management and technology. These costs have historically been allocated primarily based on estimated use of services ascompared to Kerr-McGee's other businesses. These costs are included in selling, general and administrative expenses in the combinedstatement of operations.

Employee Benefits and Incentives. Represents fringe benefit costs and other incentives, including group health and welfare benefits,U.S. pension plans, U.S. postretirement benefit plans and employee stock-based compensation plans. These costs have historically beenallocated on an active headcount basis for health and welfare benefits, including U.S. postretirement plans, on the basis of salary for U.S.pension plans and on a specific identification basis for employee stock-based employee compensation plans. These costs are included in costsof goods sold, selling, general and administrative expenses and restructuring charges in the combined statement of operations.

Interest Expense. Kerr-McGee has provided financing to us through cash flows from its other operations and debt incurred. Althoughthe incurred debt has not been allocated to us, a portion of the interest expense has been allocated based on specifically-identified borrowingsat Kerr-McGee's average borrowing rates. These costs are included in other income (expense) in the combined statement of operations, net ofinterest income that has been allocated to Kerr-McGee on certain monies we have loaned to Kerr-McGee.

46



Expense allocations from Kerr-McGee reflected in the income (loss) from continuing operations in the combined financial statementswere as follows:

Nine MonthsEnded September 30,

Year Ended December 31,

2005 2004 2004 2003 2002(millions of dollars)

General corporate expenses $ 20.3 $ 20.7 $ 27.4 $ 25.3 $ 20.7Employee benefits and incentives(1) 17.9 20.8 28.8 35.9 7.6Interest expense, net 12.5 8.4 12.1 10.1 12.9(1)

Includes special termination benefits, settlement and curtailment losses of $9.1 million and $28.7 million for years 2004 and 2003, respectively.

These allocations were based on what Kerr-McGee considered to be reasonable reflections of the historical utilization levels of theseservices required in support of our business. We currently estimate that general annual corporate expenses will increase by approximately$20.0 to $25.0 million when we become a stand-alone company.

Kerr-McGee uses a worldwide centralized approach to cash management and the financing of its operations, with all related activitybetween Kerr-McGee and us reflected as net transfers from Kerr-McGee in the combined statement of comprehensive income (loss) andbusiness equity. In connection with our separation from Kerr-McGee, the net amount due from us to Kerr-McGee at the closing date of thisoffering will be contributed by Kerr-McGee to us as equity, forming a part of our continuing equity. Subsequent to the closing of this offering,amounts due from or to Kerr-McGee arising from transactions subsequent to that date will be settled in cash.

We believe the assumptions underlying the combined financial statements are reasonable. However, the combined financial statementsmay not necessarily reflect our future results of operations, financial position and cash flows or what our results of operations, financialposition and cash flows would have been had we been a stand-alone company during the periods presented.

47



Results of Operations

The following table summarizes segment operating profit (loss), with a reconciliation to combined net income (loss) for each of the lastthree years and for the nine-month periods ended September 30, 2005 and 2004:

Nine MonthsEnded September 30,

Year Ended December 31,

2005 2004 2004 2003 2002(millions of dollars)

Net salesPigment $ 944.2 $ 869.4 $ 1,208.4 $ 1,078.8 $ 994.3Electrolytic and other chemical products 73.3 70.5 93.4 78.9 70.0

Total $ 1,017.5 $ 939.9 $ 1,301.8 $ 1,157.7 $ 1,064.3

Operating profit (loss)(1)

Pigment $ 80.2 $ (91.4) $ (86.5) $ (15.0) $ 23.5Electrolytic and other chemical products(2) (6.3) (0.8) (0.6) (22.0) (13.4)

Subtotal 73.9 (92.2) (87.1) (37.0) 10.1

Expenses of nonoperating sites(3) (1.3) (5.6) (5.5) (3.6) (0.8)Provision for environmental remediation and restoration(3) (5.6) (2.2) (2.2) (1.6) (4.1)

Operating profit (loss) 67.0 (100.0) (94.8) (42.2) 5.2Other income (expense) (12.1) (20.0) (25.3) (20.6) (13.2)Benefit (provision) for income taxes (20.5) 38.1 38.3 15.1 (8.3)

Income (loss) from continuing operations 34.4 (81.9) (81.8) (47.7) (16.3)Discontinued operations, net of taxes (21.8) (45.3) (45.8) (35.8) (81.0)Cumulative effect of change in accounting principle, net oftaxes

� � � (9.2) �

Net income (loss) $ 12.6 $ (127.2) $ (127.6) $ (92.7) $ (97.3)

(1)Our management evaluates segment performance based on segment operating profit (loss), which represents the results of segment operations before unallocated costs,

such as general expenses and environmental provisions related to sites no longer in operation, income tax expense or benefit and other income (expense). Total operating

profit (loss) of both of our segments is a non-GAAP financial measure of the company's performance, as it excludes general expenses and environmental provisions related

to sites no longer in operation which are a component of operating profit (loss), the most comparable GAAP measure. Our management considers total operating profit

(loss) of our segments to be an important supplemental measure of our operating performance by presenting trends in our core businesses and facilities currently in

operation. This measure is used by us for planning and budgeting purposes and to facilitate period-to-period comparisons in operating performance of our reportable

segments in the aggregate by eliminating items that affect comparability between periods. We believe that total operating profit (loss) of our segments is useful to investors

because it provides a means to evaluate the operating performance of our segments and our company on an ongoing basis using criteria that are used by our internal

decision makers. Additionally, it highlights operating trends and aids analytical comparisons. However, total operating profit (loss) of our segments has limitations and

should not be used as an alternative to operating profit (loss), a performance measure determined in accordance with GAAP, as it excludes certain costs that may affect our



operating performance in future periods.

(2)Includes $11.3 million and $0.4 million for the nine months ended September 30, 2005 and 2004, respectively, and nil, $11.0 million and $21.5 million for the years ended

2004, 2003 and 2002, respectively, of environmental charges, net of reimbursements, related to ammonium perchlorate remediation at our Henderson facility.

(3)Includes general expenses and environmental provisions related to various businesses in which our affiliates are no longer engaged but that have not met the criteria for

reporting as discontinued operations.

Nine Months Ended September 30, 2005 Compared to Nine Months Ended September 30, 2004

Net Sales. Net sales increased by $77.6 million, or 8.3%, to $1,017.5 million during the first nine months of 2005 from $939.9 millionin the first nine months of 2004. The increase was due to an increase in the pigment segment sales of $74.8 million and an increase inelectrolytic and other

48



chemical product segment sales of $2.8 million, as discussed below under "�Pigment Segment�Net Sales" and "�Electrolytic and OtherChemical Products Segment�Net Sales."

Gross Margin. Gross margin for the first nine months of 2005 increased $74.0 million compared to the same period in 2004. As apercent of sales, gross margin increased to 16.7% in the first nine months of 2005 from 10.2% in 2004. The improved margin was primarilydue to improved pricing in the pigment segment realized during the first nine months of 2005 and due to an inventory revaluation charge of$15.6 million recognized in 2004 in connection with the shutdown of our titanium dioxide pigment sulfate production at our Savannah,Georgia facility. The higher prices were partially offset by increased manufacturing costs, including higher raw material, energy and payrollbenefit costs, and a $5.9 million charge for the write-off of drilling and testing an exploratory deep-well waste injection system.

Selling, General and Administrative Expenses. Selling, general and administrative expenses increased $5.7 million during the first ninemonths of 2005 compared to the same period in 2004. This increase was primarily due to an increase in employee incentive compensationrelated to cash bonuses resulting from the improved operating performance during the 2005 period.

Restructuring Charges. In the first nine months of 2005, we had no restructuring charges. In September 2004, we shutdown ourtitanium dioxide pigment sulfate production at our Savannah, Georgia facility. Demand and prices for sulfate anatase pigments, particularly inthe paper market, had declined in North America consistently during the previous several years. The decreasing volumes, along withunanticipated environmental and infrastructure issues discovered after we acquired the facility in 2000, created unacceptable financial returnsfor the facility and contributed to the decision to shut it down.

Included in the restructuring charges in 2004 related to the shutdown of the Savannah facility was $86.2 million of asset write-downstaken in the form of accelerated depreciation for plant assets, $7.4 million for impairment of intangible assets, $6.5 million for severance andbenefit plan curtailment costs and $6.6 million for other closure costs. We also recognized an additional $5.4 million of costs in 2004 inconnection with the closure of the synthetic rutile plant in Mobile, Alabama.

Provision for Environmental Remediation and Restoration, Net of Reimbursements. Provision for environmental remediation andrestoration, net of reimbursements was $17.0 million in the first nine months of 2005 compared to $3.6 million in the same period of 2004.The net provision for the first nine months of 2005 included $11.3 million related to remediation of ammonium perchlorate contaminationassociated with the Henderson, Nevada facility. It was determined in 2005 that the groundwater remediation system at the Henderson facilitywould need to be operated and maintained over an extended time period and a provision was added for the closure of an ammoniumperchlorate pond. The provision for environmental remediation and restoration also included a net charge of $5.6 million in 2005 related toremediation of the former agricultural chemical Jacksonville, Florida site for soil remediation and excavation (see "�Environmental Matters").

Other Income (Expense). Other expenses, net, decreased $7.9 million during the first nine months of 2005 compared to the same periodin 2004 primarily due to lower net fees incurred in connection with the accounts receivable securitization program that was terminated inApril 2005, including a return of estimated fees previously paid in excess of actual costs incurred, and a reduction in losses attributable tochanges in the exchange rates for both the euro and the Australian dollar of $5.2 million. These decreased costs were partially offset by$4.3 million higher interest costs for the period due to an increase in both the specifically-identified borrowings with Kerr-McGee that interestexpense was allocated on and an increase in the interest rate used to allocate such interest expense.

Benefit (Provision) for Income Taxes. Our effective tax rate related to continuing operations for the first nine months of 2005 was37.3%, compared to 31.8% for the first nine months of 2004. This effective rate is reflective of and based on Kerr-McGee's current taxallocation policy. During the first

49



nine months of 2005, we repatriated $121 million in extraordinary dividends under the American Jobs Creation Act of 2004, resulting inrecognition of an income tax expense of $4.5 million, net of certain foreign tax credits. On a stand-alone basis, our pro forma provision forincome taxes related to continuing operations for the first nine months of 2005 would have been $17.2 million less than that determined underthe current allocation policy. This difference in income taxes was due primarily to income in the United States that would have beeneliminated by our theoretical stand-alone net operating loss carryforward which we would not have previously recognized as a deferred taxasset.

Loss from Discontinued Operations. The loss from discontinued operations, net of taxes, in the first nine months of 2005 was$21.8 million compared to $45.3 million for the same period in 2004. The loss in 2005 includes $11.4 million loss, net of tax, on our formerforest products operations, including an environmental provision of $3.2 million, net of taxes, for additional soil volumes related to the Sauget,Illinois wood-treatment plant. Also included is a $5.2 million environmental provision, net of taxes, for pond closure, rock placement andsurface water channels at the Ambrosia Lake, New Mexico site associated with our formerly conducted uranium mining and millingoperations (see "�Environmental Matters�Environmental Costs" below and note 10 to the interim unaudited condensed combined financialstatements included elsewhere in the prospectus).

Pigment Segment

Net Sales. Net sales increased $74.8 million, or 8.6%, during the first nine months of 2005 compared to the same period in the prioryear. Approximately $113.5 million of this increase was due to an increase in average selling prices of approximately 14%, which waspartially offset by approximately $38.7 million due to lower sales volumes. The lower sales volumes were primarily due to the shutdown ofour Savannah sulfate facility in September of 2004. Stronger market conditions contributed to the improvement in pricing, which was alsopositively impacted by the effect of foreign currency exchange rates in the 2005 period.

Operating Profit. Operating profit for the first nine months of 2005 was $80.2 million, an increase of $171.6 million over the operatingloss of $91.4 million for the same 2004 period. The increase is primarily attributable to the shutdown provisions incurred in 2004 of$122.5 million related to the Savannah facility. The increase was also driven by higher net sales, partially offset by increased manufacturingcosts of $55.9 million due to higher raw material, energy and payroll benefit costs and the write-off of an exploratory deep-well wasteinjection system of $5.9 million. Lower sales volumes also resulted in $38.5 million lower manufacturing and transportation costs. Selling,general and administrative costs were higher by $8.3 million compared to the same period in 2004 primarily due to an increase in employeeincentive compensation related to cash bonuses resulting from improved operating performance in 2005.

Electrolytic and Other Chemical Products Segment

Net Sales. Net sales for the first nine months of 2005 were $73.3 million, an increase of $2.8 million, compared to the same period inthe prior year, primarily due to increased sales of electrolytic manganese dioxide and lithium manganese oxide.

Operating Loss. Operating loss in the first nine months of 2005 was $6.3 million, compared with an operating loss of $0.8 million inthe same 2004 period. In the first nine months of 2005, we incurred a net $11.7 million environmental provision related primarily toammonium perchlorate remediation associated with our Henderson, Nevada operations (net of expected insurance reimbursement of$21.0 million). This charge was partially offset by $3.4 million due to improved operations in 2005 at our Henderson, Nevada facility whichincurred higher costs in 2004 when production recommenced after being temporarily curtailed in late 2003 and by $2.7 million resulting fromimproved pricing for all products in 2005.

50



Year Ended December 31, 2004 Compared to Year Ended December 31, 2003

Net Sales. Net sales increased by $144.1 million, or 12.4%, to $1,301.8 million in 2004 from $1,157.7 million in 2003. The increasewas due to increased sales in the pigment segment of $129.6 million and increased sales in the electrolytic and other chemical productssegment of $14.5 million, as discussed below under "�Pigment Segment�Net Sales" and "�Electrolytic and Other Chemical ProductsSegment�Net Sales."

Gross Margin. Gross margin in 2004 was $132.9 million compared to $133.0 million in 2003. As a percent of sales, gross margindeclined to 10.2% in 2004 from 11.5% in 2003. The decline in the gross margin percentage was primarily due to an inventory revaluationcharge of $15.6 million recognized in 2004 in connection with the shutdown of our titanium dioxide pigment sulfate production at ourSavannah, Georgia facility (see further discussion under "�Restructuring Charges" below).

Selling, General and Administrative Expenses. Selling, general and administrative expenses increased $11.2 million in 2004 comparedto 2003. This increase was due to an increase in employee incentive compensation related to cash bonuses and restricted stock awards,additional costs associated with cash settlements of certain qualified benefits associated with retirements during the year and increased legalfees.

Restructuring Charges. In 2004, we shutdown our titanium dioxide pigment sulfate production at our Savannah, Georgia facility.Demand and prices for sulfate anatase pigments, particularly in the paper market, had declined in North America consistently during theprevious several years. The decreasing volumes, along with unanticipated environmental and infrastructure issues discovered after weacquired the facility in 2000, created unacceptable financial returns for the facility and contributed to the decision to shut it down. We expectthis shutdown, once fully implemented, will result in an improvement in segment operating profit of approximately $15 million annuallybased on 2004 costs.

Included in the restructuring charges in 2004 was $86.6 million of asset write-downs taken in the form of accelerated depreciation ofplant assets, $7.4 million for impairment of intangible assets, $6.7 million for severance and benefit plan curtailment costs and $6.7 million forother closure costs. We also recognized an additional $5.6 million of costs in 2004 in connection with the closure of the synthetic rutile plantin Mobile, Alabama. The 2003 restructuring charges included $38.6 million for shutdown costs related to the Mobile, Alabama facility and$22.8 million in connection with a work force reduction program consisting of both voluntary retirements and involuntary terminations thatreduced our work force by 138 employees.

Provision for Environmental Remediation and Restoration, Net of Reimbursements. Provision for environmental remediation andrestoration, net of reimbursements, was $4.6 million in 2004 compared to $14.9 million in 2003. The decrease in 2004 was primarily due to an$11.0 million provision in 2003 related to ammonium perchlorate at our Henderson, Nevada facility. Our environmental obligations arediscussed in detail under "�Environmental Matters�Environmental Costs" below and note 21 to the audited combined financial statementsincluded elsewhere in this prospectus.

Other Income (Expense). Other expense increased $4.7 million in 2004 compared to 2003 primarily due to a $3.4 million increased losson the pigment receivables sold under the asset monetization program due to increased activity in 2004 and an increase in the foreign currencylosses in 2004 of $1.7 million primarily due to unfavorable changes in the Australian dollar exchange rates.

Benefit for Income Taxes. Our effective tax rate related to continuing operations was 31.9%, compared with 24.0% in 2003. This rate isbased on Kerr-McGee's current tax allocation policy. On a stand-alone basis, our pro forma provision for income taxes related to continuingoperations in 2004 would have been $44.2 million more than that determined under our allocation policy with Kerr-McGee. This increase inincome taxes was due primarily to net operating losses in the United States which we would not have been able to utilize on a stand-alonebasis.

51



Loss from Discontinued Operations. We recognized a loss from discontinued operations as a result of our decision to dispose of theforest products business and additional environmental provisions related to other previously discontinued operations of $45.8 million in 2004and $35.8 million in 2003, net of tax benefit. The increased loss in 2004 was primarily due to additional environmental provisions, net ofreimbursements and taxes, in 2004 related to our former thorium manufacturing and refining operations of $5.7 million and $5.1 million net oftaxes, respectively.

Cumulative Effect of Change in Accounting Principle. We recognized a charge of $9.2 million (net of income tax benefit of$4.9 million) in 2003 upon adoption, as of January 1, 2003, of Financial Accounting Standards Board Statement No. 143 (FAS No. 143),"Accounting for Asset Retirement Obligations" related to our Mobile plant which we expected to close at the date of adoption of this standard.

Pigment Segment

Net Sales. Net sales increased $129.6 million, or 12%, in 2004 to $1,208.4 million from $1,078.8 million in 2003. Of the total increase,approximately $114 million was due to increased sales volumes and approximately $16 million resulted from an increase in average salesprices. Sales volumes for 2004 were approximately 9% higher than in the prior year due primarily to stronger market conditions.Approximately half of the increase in average sales prices in 2004 was due to the effect of foreign currency exchange rates with the remainderdue to price increases resulting from improved market conditions.

Operating Loss. The pigment segment recorded an operating loss of $86.5 million in 2004, compared with an operating loss of$15.0 million in 2003. The 2004 operating loss was primarily the result of shutdown provisions discussed above for the sulfate-processtitanium dioxide pigment production at the Savannah, Georgia, facility totaling $123.0 million. Operating results for 2004 also werenegatively impacted by $6.8 million of costs incurred in connection with the continued efforts to close the synthetic rutile plant in Mobile,Alabama, compared to a $46.7 million plant closure provision recognized in 2003 for this facility. Additionally, operating results in 2003 werenegatively impacted by a $22.9 million charge for work force reduction and other compensation costs. These charges had the effect ofreducing operating profit by $129.8 million in 2004 and $69.6 million in 2003. The increase in revenues in 2004 resulting from higher volumeand sales prices was offset by an increase of approximately $132 million in production costs due to higher volume (approximately$80 million) and costs (approximately $52 million including the effects of foreign currency exchange rate changes) and an increase in selling,general and administrative expenses of approximately $6 million over 2003. Additional information related to the shutdowns of the Savannahand Mobile facilities is included in note 15 to the audited combined financial statements included elsewhere in this prospectus.

We began production through a new high-productivity oxidation line at our Savannah, Georgia chloride process pigment plant in January2004. This new technology results in low-cost incremental capacity increases through modification of existing chloride oxidation lines andallows for improved operating efficiencies through simplification of hardware configurations and reduced maintenance requirements. Wecontinue to evaluate the performance of this new oxidation line and expect to determine how the Savannah site might be reconfigured toexploit its capabilities in 2005. The possible reconfiguration of the Savannah site, if any, could include redeployment or idling of assets andreduction of their future useful lives, resulting in the acceleration of depreciation expense and the recognition of other charges. However,current production demands make it less likely that any existing production lines would be idled in the near term.


Net Sales. Net sales increased $14.5 million, or 18.4%, in 2004 to $93.4 million from $78.9 million in 2003. The increase in net salesresulted primarily from an increase in electrolytic sales due primarily

52



to the full year of operations at our electrolytic manganese dioxide (EMD) manufacturing operation in Henderson, Nevada (see furtherdiscussion under "�Operating Loss" below).

Operating Loss. The electrolytic and other chemical products segment recorded an operating loss for 2004 of $0.6 million comparedwith an operating loss of $22.0 million in 2003. The improved operating performance was primarily due to the full year of operations at theEMD facility, lower environmental costs in 2004 of $9.4 million compared to 2003 and work force reduction and other compensation chargesrecognized in 2003 that did not recur in 2004. The 2003 environmental costs incurred related primarily to remediation of ammoniumperchlorate contamination associated with the Henderson, Nevada facility. While we are no longer producing ammonium perchlorate, wecontinue to use the property in our other chemical products business.

During the third quarter of 2003, our EMD manufacturing operation in Henderson, Nevada, was placed on standby to reduce inventorylevels due to the harmful effect of low-priced imports on our EMD business. In response to the pricing activities of importing companies,Tronox LLC filed a petition for the imposition of anti-dumping duties with the U.S. Department of Commerce International TradeAdministration and the U.S. International Trade Commission on July 31, 2003. In its petition, Tronox LLC alleged that manufacturers incertain named countries export EMD to the United States in violation of U.S. anti-dumping laws and requested that the U.S. Department ofCommerce apply anti-dumping duties to the EMD imported from such countries. The Department of Commerce found probable cause tobelieve that manufacturers in the specified countries engaged in dumping and initiated an anti-dumping investigation with respect to suchmanufacturers. Subsequently, demand in the United States for U.S.-produced EMD product increased, and the plant resumed operations inDecember 2003. Tronox LLC withdrew its anti-dumping petition in February 2004 but continues to monitor the pricing activities of EMDimporters.

Year Ended December 31, 2003 Compared to December 31, 2002

Net Sales. Net sales increased by $93.4 million, or 8.8%, to $1,157.7 million in 2003 from $1,064.3 million in 2002. The increase in netsales was due to an increase of $84.5 million in pigment segment sales and an $8.9 million increase in electrolytic and other chemical productssegment sales, as discussed below under "�Pigment Segment�Net Sales" and "�Electrolytic and Other Chemical Products Segment�NetSales."

Gross Margin. Gross margin increased $17.7 million, or 15.4% in 2003 from $115.3 million in 2002 to $133.0 million in 2003. As apercent of sales, gross margin increased to 11.5% in 2003 from 10.8% in 2002. The increase was primarily due to improved sales prices in thepigment segment, as discussed below under "�Pigment Segment."

Selling, General and Administrative Expenses. Selling, general and administrative expenses increased $14.9 million in 2003 comparedto 2002. This increase was primarily due to increased general corporate allocations from Kerr-McGee, additional consulting and legal fees andincreased employee incentive compensation in the form of cash bonuses.

Restructuring Charges. In 2003, we closed our synthetic rutile plant in Mobile, Alabama. We recorded a write-down of fixed assets inthe form of accelerated depreciation of $15.2 million for plant assets, $16.6 million for severance and benefit plan curtailment costs and$6.8 million for other shutdown costs. We also recognized a $22.8 million charge in 2003 in connection with a work force reduction programconsisting of both voluntary retirements and involuntary terminations that reduced our work force by 138 employees. In 2002, we recorded an$11.8 million write-down of fixed assets in the form of accelerated depreciation for abandoned engineering projects.

53



Provision for Environmental Remediation and Restoration, net of Reimbursements. Provision for environmental remediation andrestoration, net of reimbursements, was $14.9 million in 2003 compared to $14.3 million in 2002, primarily related to remediation ofammonium perchlorate contamination at our Henderson, Nevada facility in both years. Our environmental obligations are discussed in detailunder "�Environmental Matters" below and note 21 to the audited combined financial statements included elsewhere in this prospectus.

Other Income (Expense). Other expense increased $7.4 million in 2003 compared to 2002 primarily due to a $10.1 million increase inthe foreign currency losses in 2003 as a result of unfavorable changes in both the euro and Australian dollar exchange rates compared to theU.S. dollar.

Benefit (Provision) for Income Taxes. Our effective tax rate related to continuing operations for 2003 was a benefit of 24.0%, comparedwith expense of 103.8% in 2002. This rate is based on Kerr-McGee's current tax allocation policy. The difference in the effective rate is due tothe proportion of income from continuing operations attributable to foreign operations.

Loss from Discontinued Operations. We recognized a loss from discontinued operations as a result of our decision to dispose of theforest products business and additional environmental and litigation provisions related to other previously discontinued operations of$35.8 million in 2003 and $81.0 million in 2002, net of tax benefit. The decrease in the loss in 2003 was due to $44.9 million of additionallitigation expenses in 2002 related primarily to our former forest products operations.

Pigment Segment

Net Sales. Net sales increased $84.5 million, or 8.5%, in 2003 to $1,078.8 million from $994.3 million in 2002. Of the total increase,approximately $94 million resulted from an increase in average sales prices, partially offset by an approximately $10 million decrease due tolower sales volumes. The increase in average sales prices in 2003 was largely due to the effect of foreign currency exchange rates. Excludingthe effect of foreign currency exchange rates, average selling prices in local currencies for 2003 were 3% higher than in 2002. Sales volumesfor 2003 were approximately 1% lower than in the prior year.

Operating Profit (Loss). The pigment segment recorded an operating loss of $15.0 million in 2003, compared with an operating profitof $23.5 million in 2002. The increase in revenues due to higher sales prices was partially offset by an increase in average product costs ofapproximately $58 million and selling, general and administrative costs of approximately $11 million over 2002. Additionally, operatingresults in 2003 were negatively affected by $46.7 million in plant closure provisions related to the shutdown of the synthetic rutile plant inMobile, Alabama, together with a $22.9 million charge for work force reduction and other compensation costs. The 2002 operating profitincluded $11.8 million in charges for abandoned chemical engineering projects, approximately $3 million for severance and other costs and a$6.1 million reversal of environmental reserves associated with the Savannah operations.


Net Sales. Net sales increased $8.9 million, or 12.7%, in 2003 to $78.9 million from $70.0 million in 2002. The increase in net saleswas primarily due to higher electrolytic operations sales volumes. The increased volumes were predominantly achieved in sodium chlorateand boron products (17% and 37%, respectively).

Operating Loss. Operating loss for 2003 was $22.0 million compared with operating loss of $13.4 million in 2002. The $8.6 millionincrease in operating loss for 2003 was primarily due to the 2003 work force reduction costs and other compensation charges of approximately$4.1 million and higher electrolytic product costs of approximately $8 million, partially offset by lower environmental costs of approximately$4.2 million. Environmental provisions in both 2003 and 2002 related primarily

54



to remediation of ammonium perchlorate contamination associated with our Henderson, Nevada, operations (see "�EnvironmentalMatters�Environmental Costs" and note 21 to the audited combined financial statements included elsewhere in this prospectus).

Financial Condition

Liquidity and Capital Resources Following the Transactions

The Transactions will change our capital structure and long-term capital commitments significantly from those that existed onSeptember 30, 2005. The following table provides information for the analysis of our financial condition and liquidity as of September 30,2005, after giving effect to the pro forma adjustments set forth in "Unaudited Pro Forma Combined Financial Statements" (in millions ofdollars):

Current ratio(1) 2.4:1Cash and cash equivalents $ 40.0Working capital(2) 418.9Total assets 1,676.0Long-term debt 548.0Stockholders' equity 284.2(1)

Represents a ratio of current assets to current liabilities.

(2)Represents excess of current assets over current liabilities.

Liquidity Requirements. After giving effect to the pro forma adjustments set forth in "Unaudited Pro Forma Combined FinancialStatements," our primary cash needs will be for working capital, capital expenditures, environmental cash expenditures and debt service underthe senior secured credit facility and the unsecured notes. We believe that our cash flows from operations, together with borrowings under ourrevolving credit facility, will be sufficient to meet these cash needs for the foreseeable future. However, our ability to generate cash is subjectto general economic, financial, competitive, legislative, regulatory and other factors that are beyond our control. If our cash flows fromoperations are less than we expect, we may need to raise additional capital. We may also require additional capital to finance our futuregrowth and development, implement additional marketing and sales activities, and fund our ongoing research and development activities.

As of September 30, 2005, after giving effect to the pro forma adjustments set forth in "Unaudited Pro Forma Combined FinancialStatements," we would have had approximately $548.0 million of long-term debt and $284.2 million of combined stockholders' equity.Additional debt or equity financing may not be available when needed on terms favorable to us or even available to us at all. As described in"Description of Our Concurrent Financing Transactions," we also will be restricted by the terms of the senior secured credit facility and theindenture governing the unsecured notes from incurring additional indebtedness. Under our master separation agreement, from the completionof the Transactions until the completion of the Distribution, we may not incur any additional indebtedness (other than under the revolvingcredit facility) without Kerr-McGee's prior consent. While Kerr-McGee owns at least a majority of our outstanding common stock, we also arerestricted from issuing any shares of our capital stock, or any rights, warrants or options to acquire our capital stock (other than any shares ofour capital stock or options to acquire our capital stock granted in connection with the performance of services), if this would cause Kerr-McGee to own less than a majority of our outstanding common stock (on a fully diluted basis). In these circumstances, we also are restrictedfrom issuing any shares of our capital stock if this would cause Kerr-McGee to own less than 80% of the total voting power of our outstandingcapital stock entitled to vote generally in the election of our directors and from issuing any shares of non-voting stock. In addition, under ourtax sharing agreement with Kerr-McGee, if we enter into transactions during the two-year period following the Distribution which result in theissuance or



55



acquisition of our shares, and the Internal Revenue Service subsequently determines that Section 355(e) of the Internal Revenue Code isapplicable to the Distribution, we will be required to indemnify Kerr-McGee for any resulting tax liability incurred by it.

Financing Sources. Concurrently with the closing of this offering, our wholly-owned subsidiary, Tronox Worldwide, will enter into asenior secured credit facility. This facility will consist of a $200 million six-year term loan facility and a five-year multicurrency revolvingcredit facility of $250 million. The full amount of the revolving credit facility will be available for issuances of letters of credit and$25 million of the revolving credit facility will be available for swingline loans. The senior secured credit facility will be unconditionally andirrevocably guaranteed by Tronox and Tronox Worldwide's direct and indirect material domestic subsidiaries (including Tronox FinanceCorp.). The facility will be secured by a first priority security interest in certain domestic assets, including certain real property, of TronoxWorldwide and the guarantors of the senior secured credit facility. The facility will also be secured by pledges of the equity interests inTronox Worldwide and Tronox Worldwide's direct and indirect domestic subsidiaries, and up to 65% of the voting and 100% of the non-voting of the equity interests in Tronox Worldwide's direct foreign subsidiaries and the direct foreign subsidiaries of the guarantors of thesenior secured credit facility. See "Description of Our Concurrent Financing Transactions�Senior Secured Credit Facility."

The term loan facility is expected to amortize each year in an amount equal to 1% per year in equal quarterly installments for the first fiveyears and in an amount equal to 95% per year in equal quarterly installments for the final year. In addition, we expect to be required to repaythe term loan facility with the following amounts:

�� 100% of an amount equal to the net after-tax cash proceeds for any issuances or incurrence of any indebtedness not permittedby the senior secured credit facility;

�� 100% of an amount equal to the net after-tax cash proceeds of certain sales or other dispositions by us of any assets, unless wereinvest the proceeds within one year in capital assets or permitted acquisitions; and

�� 75% of an amount equal to excess cash flow for each fiscal year, commencing with fiscal year 2006.

We expect that the amount of excess cash flow we must use for prepayments of the term loan facility will be reduced if we meet certainfinancial performance targets.

Principal balances under the senior secured credit facility are expected to bear interest per annum, at Tronox Worldwide's option, at afluctuating rate of interest measured by reference to either LIBOR or an alternative base rate, plus a borrowing margin. Base rate loans will bereferenced to the higher of the federal funds rate plus 0.50% or the prime rate. We expect the borrowing margins under the senior securedcredit facility to vary in 0.25% increments in a range from 1.0% to 2.0% for LIBOR loans and from 0.0% to 1.0% for base rate loans,depending on the credit rating of the senior secured credit facility. We expect that Tronox Worldwide will be required to pay certain fees withrespect to the senior secured credit facility, including annual administration fees, a commitment fee based on the undrawn portion of therevolving commitments and other similar fees.

At closing, the term loan facility will be fully funded and the net proceeds from that facility will be distributed to Kerr-McGee. Undrawnamounts under the revolving credit facility will be available on a revolving basis for general corporate purposes of Tronox Worldwide and itssubsidiaries, subject to specified conditions.

Concurrently with the closing of this offering, Tronox Worldwide and Tronox Finance Corp. will co-issue $350 million in aggregateprincipal amount of unsecured notes due 2012 in a private offering. Tronox Worldwide's and Tronox Finance Corp.'s payment obligationsunder the unsecured notes will be

56



guaranteed by Tronox and by Tronox Worldwide's material direct and indirect wholly-owned domestic subsidiaries. The net proceeds from theoffering of unsecured notes also will be distributed to Kerr-McGee.

The senior secured credit facility and the indenture governing the unsecured notes will subject us to certain financial and other covenants.See "�Covenant Compliance" and "Description of Our Concurrent Financing Transactions."

Covenant Compliance. We expect the senior secured credit facility to require us to maintain a maximum level of total debt to adjustedEBITDA and a minimum adjusted interest coverage ratio, in each case, on a trailing four-quarter basis. We expect our compliance with thesecovenants to be tested each quarter, starting with the quarter ending March 31, 2006. We believe that the senior secured credit facility is amaterial agreement and that these financial covenants are material terms of that agreement. Non-compliance with these covenants could resultin a default, and an acceleration in the repayment of amounts outstanding, under that facility. Any acceleration in the repayment of amountsoutstanding under the senior secured credit facility would result in a default under the indenture governing the unsecured notes. While anevent of default under the senior secured credit facility or the indenture governing the unsecured notes is continuing, we would be precludedfrom, among other things, paying dividends on our common stock or borrowing under the revolving credit facility. As a result, we believe theinformation presented below regarding these financial covenants is material to investors' understanding of our results of operations andfinancial condition. For a more complete description of the senior secured credit facility and the indenture governing the unsecured notes, see"Description of our Concurrent Financing Transactions." The senior secured credit facility and the indenture governing the unsecured noteswill be filed as an exhibit to the registration statement of which this prospectus forms a part.

Total Debt to Adjusted EBITDA Ratio

We expect the senior secured credit facility to require us initially to maintain a total debt to adjusted EBITDA ratio for each four-quarterperiod of no more than 3.75x. The following table shows:

�� for the periods presented and after giving effect to the pro forma adjustments set forth in "Unaudited Pro Forma CombinedFinancial Statements":

�� our total debt,

�� our adjusted EBITDA, and

�� the ratio of our total debt to adjusted EBITDA; and

�� the maximum ratio of total debt to adjusted EBITDA we expect initially will be required by the senior secured credit facility.

57



Pro Forma

Year Ended

December 31, 2004

Pro Forma

Twelve Months

Ended

September 30, 2005


Total debt:Senior secured credit facility $ 200.0 $ 200.0Unsecured notes 350.0 350.0

Total debt $ 550.0 $ 550.0

Adjusted EBITDA $ 142.2 $ 206.2Ratio of total debt to adjusted EBITDA 3.87x 2.67xMaximum ratio of total debt to adjusted EBITDA expected to berequired under the senior secured credit facility

3.75x

On a pro forma basis for the year ended December 31, 2004, we would not have been in compliance with the total debt to adjustedEBITDA ratio that will be imposed on us by the senior secured credit facility. However, based on our current financial projections, asillustrated by our pro forma compliance for the twelve months ended September 30, 2005, we believe that we will be in compliance with thiscovenant in future periods.

Adjusted Interest Coverage Ratio

We expect the senior secured credit facility to require us initially to maintain an adjusted interest coverage ratio for each four-quarterperiod of no less than 2.00x. The minimum adjusted interest coverage ratio is expected to be defined as (i) adjusted EBITDA, less the sum ofcash expenditures for environmental remediation and restoration (net of cash reimbursements), discontinued operations and asset retirementobligations, to (ii) interest expense. The following table shows:

�� for the periods presented and after giving effect to the pro forma adjustments set forth in "Unaudited Pro Forma CombinedFinancial Statements":

�� our adjusted EBITDA, less the sum of cash expenditures for environmental remediation and restoration (net of cashreimbursements), discontinued operations and asset retirement obligations,

�� our interest expense, and

�� our adjusted interest coverage ratio; and

�� the minimum adjusted interest coverage ratio we expect initially will be required by the senior secured credit facility.

58



Pro Forma

Year Ended

December 31, 2004

Pro Forma

Twelve Months

Ended

September 30, 2005


Adjusted EBITDA $ 142.2 $ 206.2less cash expenditures(1) (net of reimbursements) for:

Environmental remediation and restoration (34.7) 9.7Discontinued operations (5.3) (8.1)Asset retirement obligation (3.2) (2.1)

Total $ 99.0 $ 205.7

Interest expense 43.2 40.9Adjusted interest coverage ratio 2.29x 5.03xMinimum adjusted interest coverage ratio expected to be requiredunder the senior secured credit facility

2.00x

(1)To the extent not included in net income.

We believe the presentation of adjusted EBITDA is appropriate to provide additional information to investors to demonstrate our abilityto comply with the financial covenants to which we expect to be subject. For a reconciliation of net income (loss) to adjusted EBITDA, see"Selected Historical Combined Financial Data." The calculation of adjusted EBITDA in this prospectus is in accordance with the definitionscontained in the senior secured credit facility.

Historical Liquidity and Capital Resources

Historically, we have participated in Kerr-McGee's centralized cash management system and have relied on Kerr-McGee to providenecessary cash financing. Such activities include cash deposits from our operations which are transferred daily to Kerr-McGee's centralizedbanking system and cash borrowings used to fund our operations and capital expenditures. The related cash activity between us and Kerr-McGee is reflected as net transfers with affiliates within financing activities in our combined statement of cash flows. Additionally, asdiscussed below under "�Cash Flows from Operating Activities," certain expenditures related to our operations were paid by Kerr-McGee onour behalf and, therefore, did not affect cash flows from operating, investing and financing activities reported in our combined statement ofcash flows. As such, the amounts of cash and cash equivalents, as well as cash flows from operating, investing and financing activitiespresented in the combined financial statements are not representative of the amounts that would have been required or generated by us as astand-alone company.

In connection with our separation from Kerr-McGee, the net amount due from us to Kerr-McGee at the closing date of this offering willbe contributed by Kerr-McGee, forming a part of our continuing equity. Such net amounts due to Kerr-McGee that were outstanding at thebalance sheet dates have been reflected in the combined financial statements as a component of owner's net investment in equity. Amountsdue to or from Kerr-McGee arising from transactions subsequent to completion of this offering will be settled in cash. Following completionof this offering, Kerr-McGee will no longer provide funds to finance our operations. Concurrent with this offering, Tronox Worldwide, ourdirect wholly-owned subsidiary, will enter into a senior secured credit facility. It will also offer, jointly with its subsidiary, Tronox FinanceCorp., $350 million in aggregate principal amount of unsecured notes in a concurrent private offering. See "�Financial Condition�Liquidityand Capital Resources Following the Transactions�Financing Sources" and "Description of Our Concurrent Financing Transactions."

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The following table provides information for the analysis of our historical financial condition and liquidity:

September 30,2005

December 31,2004

December 31,2003


Current ratio(1) 2.5:1 1.7:1 1.9:1Cash and cash equivalents $ 76.7 $ 23.8 $ 59.3Working capital(2) 459.1 240.2 304.5Total assets 1,703.0 1,595.9 1,809.1(1)

Represents a ratio of current assets to current liabilities.

(2)Represents excess of current assets over current liabilities.

Of cash and cash equivalents at September 30, 2005, $34.7 million was held in the United States and $42.0 million was held in othercountries. During the first nine months of 2005, $121.0 million of unremitted foreign earnings in Australia were repatriated as extraordinarydividends, as defined in the American Jobs Creation Act of 2004, and subsequently transferred to Kerr-McGee as part of its centralized cashmanagement system (see "�New/Revised Accounting Standards" below for additional discussion).

Until recently, we had an accounts receivable monetization program, which served as a source of liquidity up to a maximum of$165.0 million. This program was terminated in April 2005, as discussed in "�Cash Flows from Operating Activities" below. Accountsreceivable originated after the termination of this program are being collected over a longer period, resulting in increased balances ofoutstanding receivables and higher current ratio, working capital and total assets as of September 30, 2005, compared with year-end 2004.

Cash Flows from Operating Activities. Cash flows from operating activities in our combined statement of cash flows for all periodspresented exclude certain expenditures incurred by Kerr-McGee on our behalf, such as income taxes, general corporate expenses, employeebenefits and incentives and net interest costs. Therefore, reported amounts are not representative of cash flows from operating activities wewill generate or use as a stand-alone company. For example, cash flows from operating activities for 2004 exclude $37.0 million paid by Kerr-McGee for income taxes on our behalf. Additionally, 2004, 2003 and 2002 cash flows from operating activities exclude $55.1 million,$65.8 million and $51.6 million, respectively, of general corporate expenses, employee benefits and incentives, and net interest costsassociated with our present and discontinued operations. While such costs are reflected in our combined statement of operations because theywere allocated to us by Kerr-McGee, they did not result in cash outlays by us. As a stand-alone company, we expect costs and expenses of thisnature will require the use of our cash and other sources of liquidity. Additionally, we expect that our general corporate expenses may be $20to $25 million greater on an annual basis than we have incurred historically, which will further reduce our cash flows from operating activitiesas compared to historical experience. Further, as discussed under "�Contractual Obligations and Commitments" below, we expect cashrequirements associated with employee pension and postretirement plans to increase following the completion of this offering.

Cash flows from operating activities for 2004 were $190.8 million, an increase of $70.4 million compared with cash flows from operatingactivities for 2003 of $120.4 million. The increase in cash flows from operating activities in 2004 is attributable primarily to a reduction ininventories, $35.7 million higher environmental cost reimbursements, $12.7 million lower expenditures for environmental remediation andrestoration and $35.0 million less cash paid for legal settlements largely related to our former forest products business. These positive effectson cash flows from operating activities were partially offset by an unfavorable effect of timing differences between product sales and

60



collections of trade accounts receivable. While improved economic conditions resulted in increased sales volumes in late 2004, collection ofthe related accounts receivable did not occur until 2005.

Cash flows from operating activities for 2003 were $120.4 million, an increase of $38.0 million compared with cash flows from operatingactivities for 2002 of $82.4 million. The increase in cash flows from operating activities in 2003 is attributable primarily to $23.2 millionlower expenditures for environmental remediation and restoration and $14.8 million higher environmental cost reimbursements.

Cash flows from operating activities for the first nine months of 2005 were $13.0 million, compared with cash from operating activitiesof $80.8 million for the same prior year period. The $67.8 million decrease in cash flows from operating activities in the first nine months of2005 was due to an increase in accounts receivable. As described under "�Off-Balance Sheet Arrangements�Accounts ReceivableMonetization Program" below, our accounts receivable monetization program was terminated in April 2005. Termination of the programresulted in a reduction of our cash flows from operating activities because the collection period for accounts receivable arising from pigmentsales subsequent to program termination is longer compared with the collection period of receivables prior to program termination. Thisdecrease in cash flows from operating activities was partially offset by higher sales volumes and prices as a result of stronger marketconditions, increased environmental cost reimbursements, and the timing of payment of accounts payable and accrued liabilities.Reimbursements of environmental expenditures exceeded cash paid for such expenditures by $27.5 million in 2005 and cash paymentsexceeded reimbursements by $17.3 million in 2004. Cash flows from operating activities for the nine months of 2005 and 2004 exclude$35.2 million and $36.3 million, respectively, of general corporate expenses, employee benefits and incentives, and net interest costsassociated with our present and discontinued operations.

Cash Used in Investing Activities. Net cash used in investing activities was $91.4 million in 2004 compared to $95.7 million in 2003and $86.6 million in 2002, principally representing capital expenditures. Significant capital expenditure projects in 2004 included wastemanagement projects and an automated slurry project at our Hamilton, Mississippi facility that was begun in 2003. In 2003, significantprojects included the Savannah plant high productivity oxidation line, waste management projects and the initial phase of the Hamilton plantautomated slurry project that was completed in 2004.

Cash provided by investing activities for the first nine months of 2005 was $118.2 million, an increase of $181.3 million from$63.1 million used in investing activities for the first nine months of 2004. The collection of repurchased accounts receivable that werecontributed to us by Kerr-McGee resulted in an increase of $165.0 million in cash from investing activities in 2005. Higher capitalexpenditures in the first nine months of 2004 reflect spending on the Savannah plant high productivity oxidation line, and processimprovements at the Hamilton plant.

Capital expenditures for fiscal 2005 are expected to be $90.0 million. Process and technology improvements that increase productivityand enhance product quality will account for approximately 43% of the 2005 capital spending. This includes changes to the Uerdingen,Germany pigment facility to convert waste to a saleable product and reduce raw material costs and upgrading the oxidation line at the Botlek,the Netherlands, pigment facility to improve throughput.

Cash Provided by (Used in) Financing Activities. Net cash provided by (used in) financing activities was $(131.1) million in 2004,$(10.3) million in 2003, and $4.1 million in 2002. Net transfers from (to) Kerr-McGee were $(131.1) million, $(10.0) million and$14.3 million in 2004, 2003 and 2002, respectively. Cash used in financing activities for the first nine months of 2005 was $81.2 million, anincrease of $41.0 million from the first nine months of 2004. All of the cash from financing activities resulted from transfers from or to Kerr-McGee. As discussed above under "�Cash Flows from Operating Activities," cash flows from operating activities presented in the historicalfinancial statements

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exclude certain operating expenditures paid by Kerr-McGee on our behalf. Therefore, we anticipate that our cash flows from operatingactivities as a stand-alone company will be lower, which may require higher levels of cash provided by financing activities in the future tosupport our operating and capital cash requirements.

Off-Balance Sheet Arrangements

Accounts Receivable Monetization Program. Through April 2005, we sold selected accounts receivable through a three-year, credit-insurance-backed asset securitization program with a maximum availability of $165.0 million. Under the terms of the program, selectedqualifying customer accounts receivable were sold monthly to a special-purpose entity (SPE), which in turn sold an undivided ownershipinterest in the receivables to a third-party multi-seller commercial paper conduit sponsored by an independent financial institution. We sold,and retained an interest in, excess receivables to the SPE as over-collateralization for the program. Our retained interest in the SPE'sreceivables was classified in trade accounts receivable in our accompanying combined balance sheet. The retained interest was subordinate to,and provided credit enhancement for, the conduit's ownership interest in the SPE's receivables, and was available to the conduit to pay certainfees or expenses due to the conduit, and to absorb credit losses incurred on any of the SPE's receivables in the event of termination. However,credit loss has historically been insignificant. We retained servicing responsibilities and received a servicing fee of 1.07% of the receivablessold for the period of time outstanding, generally 60 to 120 days. No recourse obligations were recorded since we had no obligations for anyrecourse actions on the sold receivables.

The accounts receivable monetization program included ratings downgrade triggers based on Kerr-McGee's senior unsecured debt rating.These triggers provide for program modifications, including a program termination event upon which the program would effectively liquidateover time and the third-party multi-seller commercial paper conduit would be repaid with the collections on accounts receivable sold. InApril 2005, Kerr-McGee's senior unsecured debt was downgraded, triggering program termination. As opposed to liquidating the programover time in accordance with its terms, Kerr-McGee entered into an agreement to terminate the program by repurchasing the then outstandingbalance of receivables sold of $165.0 million, which were then contributed to us.

Other Arrangements. We have entered into agreements that require us to indemnify third parties for losses related to environmentalmatters, litigation and other claims. We have recorded no material obligations in connection with such indemnification obligations. Inaddition, pursuant to our master separation agreement with Kerr-McGee, we will be required to indemnify Kerr-McGee for all costs andexpenses incurred by it arising out of or due to our environmental and other liabilities (other than such costs and expenses reimbursable byKerr-McGee pursuant to the master separation agreement.) See "Arrangements Between Kerr-McGee and Our Company�Master SeparationAgreement." At October 31, 2005, Kerr-McGee had outstanding letters of credit on our behalf in the amount of approximately $34.5 million.These letters of credit have been granted to Kerr-McGee by financial institutions to support our environmental clean-up costs and severancerequirements in international locations. We intend to replace these letters of credit in connection with the concurrent financing transactions.

Contractual Obligations and Commitments

In the normal course of business, we enter into operating leases, purchase obligations and other commitments. Operating leases primarilyconsist of rental of railcars and production equipment. The

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aggregate future payments for operating leases and purchase commitments and obligations as of December 31, 2004 are summarized in thefollowing table:

Payments Due By Period

Type of Obligation Total 20052006-2007

2008-2009

After2009


Operating leases $ 30.5 $ 6.1 $ 6.5 $ 5.3 $ 12.6Purchase obligations:

Ore contracts 387.1 155.6 191.2 40.3 �

Other purchase obligations 296.8 91.7 140.6 31.3 33.2

Total $ 714.4 $ 253.4 $ 338.3 $ 76.9 $ 45.8

We will be obligated under an employee benefits agreement with Kerr-McGee to maintain the Material Features (as defined in theemployee benefits agreement) of the U.S. postretirement plan without change for a period of three years following the effective date of theDistribution (see "Arrangements between Kerr-McGee and Our Company�Employee Benefits Agreement"). Based on the actuarially projectedobligations under that plan, we expect contributions to be in the range of $10.0 to $12.0 million for each of the next three years.

Tronox Worldwide, along with another Kerr-McGee subsidiary, is a guarantor for Kerr-McGee's $2.1 billion of long-term notes issued in2001 and 2004. On September 21, 2005, Kerr-McGee received a written consent to amend the indenture from noteholders representingapproximately 90% of the aggregate outstanding principal amount of notes, for which Kerr-McGee agreed to pay the fees to consentingnoteholders. Kerr-McGee amended the indenture governing these notes to provide for the release of Tronox Worldwide's guarantee of thenotes upon completion of an initial public offering, spin-off or split-off of the company, its successor or its parent. Pursuant to the amendedindenture, upon completion of this offering, Tronox Worldwide will be released from its guarantee of the notes.

We have obligations associated with the retirement of tangible long-lived assets. In addition to asset retirement obligations of$30.9 million reflected in the audited combined balance sheet at December 31, 2004 included elsewhere in this prospectus, obligations existfor facilities that we are not able to estimate until the timing of liability settlement is known.

Environmental MattersCurrent Businesses

We are subject to a broad array of international, federal, state and local laws and regulations relating to environmental protection. Underthese laws, we are or may be required to obtain or maintain permits or licenses in connection with our operations. In addition, under theselaws, we are or may be required to remove or mitigate the effects on the environment of the disposal or release of chemical, petroleum, low-level radioactive and other substances at various sites. Environmental laws and regulations are becoming increasingly stringent, andcompliance costs are significant and will continue to be significant in the foreseeable future. There can be no assurance that such laws andregulations or any environmental law or regulation enacted in the future will not have a material effect on our operations or financialcondition.

Sites at which we have environmental responsibilities include sites that have been designated as Superfund sites by the U.S.Environmental Protection Agency (EPA) pursuant to the Comprehensive Environmental Response, Compensation, and Liability Act of 1980(CERCLA) and that are included on the National Priority List (NPL). As of September 30, 2005, we had received notices that we had beennamed potentially responsible parties (PRP) with respect to 12 existing EPA Superfund sites on the NPL that require remediation. We do not



consider the number of sites for which we have been named a PRP to be the determining factor when considering our overall environmentalliability.

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Decommissioning and remediation obligations, and the attendant costs, vary substantially from site to site and depend on unique sitecharacteristics, available technology and the regulatory requirements applicable to each site. Additionally, we may share liability at some siteswith numerous other PRPs, and U.S. law currently imposes joint and several liability on all PRPs under CERCLA. We are also obligated toperform or have performed remediation or remedial investigations and feasibility studies at sites that have not been designated as Superfundsites by EPA. Such work frequently is undertaken pursuant to consent orders or other agreements.

Legacy Businesses

Historically, we have engaged in businesses unrelated to our current primary business, such as the treatment of forest products, theproduction of ammonium perchlorate, the refining and marketing of petroleum products, offshore contract drilling, coal mining and themining, milling and processing of nuclear materials. Although we are no longer engaged in such businesses, residual obligations with respectto certain of these businesses still exist, including obligations related to compliance with environmental laws and regulations, including theClean Water Act, the Clean Air Act, CERCLA and the Resource Conservation and Recovery Act. These laws and regulations require us toundertake remedial measures at sites of current and former operations or at sites where waste was disposed. For example, we are required toconduct decommissioning and environmental remediation at certain refineries, production and distribution facilities and service stationspreviously owned or operated before exiting the refining and marketing business in 1995. We also are required to conduct decommissioningand remediation activities at sites where we were involved in the exploration, production, processing or sale of uranium or thorium and at siteswhere we were involved in the production and sale of ammonium perchlorate. Additionally, we are decommissioning and remediating ourformer wood-treatment facilities as part of our exit from the forest products business. For a description of the decommissioning andremediation activities in which we currently are engaged, see "�Environmental Costs" below, note 21 to the audited combined financialstatements and note 10 to the interim unaudited condensed combined financial statements included elsewhere in this prospectus.

Environmental Costs

Expenditures for environmental protection and cleanup for each of the last three years and for the three-year period ended December 31,2004, are as follows:

Year Ended December 31,2004 2003 2002 Total


Charges to environmental reserves $ 85.2 $ 97.9 $ 121.1 $ 304.2Recurring expenses 17.4 13.8 32.2 63.4Capital expenditures 14.7 18.2 21.6 54.5

In addition to past expenditures, reserves have been established for the remediation and restoration of active and inactive sites where it isprobable that future costs will be incurred and the liability is reasonably estimable. For environmental sites, we consider a variety of matterswhen setting reserves, including the stage of investigation; whether EPA or another relevant agency has ordered action or quantified cost;whether we have received an order to conduct work; whether we participate as a PRP in the Remedial Investigation/Feasibility Study (RI/FS)process and, if so, how far the RI/FS has progressed; the status of the record of decision by the relevant agency; the status of sitecharacterization; the stage of the remedial design; evaluation of existing remediation technologies; the number and financial condition of otherpotential PRPs; and whether we can reasonably evaluate costs based upon a remedial design or engineering plan.

After the remediation work has begun, additional accruals or adjustments to costs may be made based on any number of developments,including revisions to the remedial design; unanticipated

64



construction problems; identification of additional areas or volumes of contamination; inability to implement a planned engineering design orto use planned technologies and excavation methods; changes in costs of labor, equipment or technology; any additional or updatedengineering and other studies; and weather conditions. Additional reserves of $81.4 million, $88.2 million and $188.1 million were added in2004, 2003 and 2002, respectively, for active and inactive sites.

As of December 31, 2004, our financial reserves for all active and inactive sites totaled $215.8 million. This includes $81.4 million addedto the reserves in 2004 for active and inactive sites. In the audited combined balance sheet at December 31, 2004 included elsewhere in thisprospectus, $130.8 million of the total reserve is classified as noncurrent liabilities-environmental remediation or restoration, and theremaining $85.0 million is included in accrued liabilities. As of September 30, 2005, our financial reserves for all active and inactive sitestotaled $239.4 million, $160.6 million of which are classified as noncurrent liabilities. We believe we have reserved adequately for thereasonably estimable costs of known environmental contingencies. However, additional reserves may be required in the future due to thepreviously noted uncertainties.

Pursuant to the master separation agreement, Kerr-McGee has agreed to reimburse us for a portion of the environmental remediationcosts we incur and pay after the completion of this offering (net of any cost reimbursements we expect to recover from insurers, governmentalauthorities or other parties). The reimbursement obligation extends to costs incurred at any site associated with any of our former businessesor operations.

With respect to any site for which we have established a reserve as of the effective date of the master separation agreement, 50% of theremediation costs we incur and pay in excess of the reserve amount (subject to a minimum threshold amount) will be reimbursable by Kerr-McGee, net of any amounts recovered or, in our reasonable and good faith estimate, that will be recovered from third parties. With respect toany site for which we have not established a reserve as of the effective date of the master separation agreement, 50% of the amount of theremediation costs we incur and pay (subject to a minimum threshold amount) will be reimbursable by Kerr-McGee, net of any amountsrecovered or, in our reasonable and good faith estimate, that will be recovered from third parties.

Kerr-McGee's aggregate reimbursement obligation to us cannot exceed $100 million and is subject to various other limitations andrestrictions. For example, Kerr-McGee is not obligated to reimburse us for amounts we pay to third parties in connection with tort claims orpersonal injury lawsuits, or for administrative fines or civil penalties that we are required to pay. Kerr-McGee's reimbursement obligation alsois limited to costs that we actually incur and pay within seven years following the completion of this offering.

The following table reflects our portion of the known estimated costs of investigation or remediation that are probable and estimable. Thetable summarizes EPA Superfund NPL sites where we have been notified we are a PRP under CERCLA and other sites for which we hadfinancial reserves recorded at year-end 2004. In the table, aggregated information is presented for other sites (each of which has a remainingreserve balance of less than $3 million). The reimbursement obligation discussed above applies to each of the sites specifically identified inthe table below. Sites specifically identified in the table below are discussed in note 21 to the audited combined financial statements andnote 10 to the interim unaudited condensed combined financial statements included elsewhere in this prospectus.

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Location of Site Stage of Investigation/Remediation

Total

Expenditures

Through

September 30, 2005

Remaining

Reserve

Balance at

September 30, 2005

Total


EPA Superfund sites on NPL

West Chicago, Illinois(1)

Vicinity areas

Remediation of thorium tailings at Residential

Areas and Reed-Keppler Park is substantially

complete. An agreement in principle for cleanup of

thorium tailings at Kress Creek and Sewage

Treatment Plant has been reached with relevant

agencies; court approval received in August 2005.

$ 132 $ 84 $ 216

Milwaukee, Wisconsin

Completed soil cleanup at former wood-treatment

facility and began cleanup of offsite tributary

creek. Groundwater remediation and cleanup of

tributary creek is continuing.

40 5 45

Lakeview, Oregon

Consolidation and capping of contaminated soils

and neutralization of acidic waters from former

uranium mining is ongoing.

9 2 11

Soda Springs, Idaho

All former impoundments of calcine tailings have

been closed as required by a record of decision

(ROD). The ROD also requires continuation of

groundwater monitoring. Closure of an additional

ten-acre pond, not a part the ROD, will be

completed within two years.

3 3 6

Other sites

Sites where the company has been named a PRP,

including landfills, wood-treating sites, a mine site

and an oil recycling refinery. These sites are in

various stages of investigation/remediation.

15 � 15

199 94 293

Sites under consent order, license or agreement,

not on EPA Superfund NPL

West Chicago, Illinois(1)

Former manufacturing facility

Excavation, removal and disposal of contaminated

soils at former thorium mill is substantially

complete. The site will be used for moving

material from the Kress Creek and Sewage

Treatment Plant remediation sites. Surface

restoration and groundwater monitoring and

remediation are expected to continue for

approximately ten years.

446 13 459

Cushing, Oklahoma Excavation, removal and disposal of thorium and 145 14 159



uranium residuals was substantially completed in

2004. Investigation of and remediation addressing

hydrocarbon contamination is continuing.

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Sites under consent order, license or agreement,

not on EPA Superfund NPL (continued)

Henderson, Nevada

Groundwater treatment to address ammonium

perchlorate contamination is being conducted

under consent decree with Nevada Department of

Environmental Protection.

122 39 161

Ambrosia Lake, New Mexico

Uranium mill tailings and selected pond sediments

consolidated and capped onsite. A request to end

groundwater treatment and a decommissioning

plan for impacted soils are under review by the

Nuclear Regulatory Commission.

27 12 39

Crescent, Oklahoma

Buildings and soil decommissioning complete.

Evaluating available technologies to address

limited on-site radionuclide contamination of

groundwater.

48 7 55

Sauget, Illinois

Soil remediation of wood-treatment related

contamination is ongoing. Conducting groundwater

monitoring and evaluating options to remediate

sediment and surface water.

8 9 17

Hattiesburg, Mississippi

Completed remediation of process areas at former

wood-treatment facility and completed most of off-

site remediation. Off-site remediation to be

completed when access to certain properties is

granted.

12 3 15

Cleveland, Oklahoma

Facility is dismantled and certain interim remedial

measures to address air, soil, surface water and

groundwater contamination are complete. Design

of on-site containment cell is under way.

19 4 23

Calhoun, Louisiana

Soil and groundwater remediation of petroleum

hydrocarbons at a former gas condensate stripping

facility is ongoing.

22 5 27

Jacksonville, Florida

Remedial investigation of a former manufacturing

and processing site for fertilizers, pesticides and

herbicides completed. Feasibility study with

recommended remediation activities expected to be

submitted to EPA in 2006.

4 6 10

Other sites

Sites related to wood-treatment, chemical

production, landfills, mining, and oil and gas

refining, distribution and marketing. These sites

are in various stages of investigation/remediation.

164 33 197



1,017 145 1,162

Total $ 1,216 $ 239 $ 1,455

(1)Amounts reported in the table for the West Chicago sites are not reduced for actual or expected reimbursement from the U.S. government under Title X of the Energy

Policy Act of 1992 (Title X), described in note 21 to the audited combined financial statements and note 10 to the interim unaudited condensed combined financial

statements included elsewhere in this prospectus.

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There may be other sites where we have potential liability for environmental-related matters but for which we do not have sufficientinformation to determine that the liability is probable or reasonably estimable. We have not established reserves for such sites. One such siteinvolves a former wood treatment plant in New Jersey.

In 1999, Tronox LLC was named as a PRP under CERCLA at a former New Jersey wood-treatment site at which EPA is conducting acleanup. On April 15, 2005, Tronox LLC and its ultimate parent, Kerr-McGee Corporation, received a letter from EPA asserting that they areliable under CERCLA as a former owner or operator of the site and demanding reimbursement of costs expended by EPA at the site. Thedemand is for payment of past costs in the amount of approximately $179 million, plus interest. Tronox LLC did not operate the site, whichhad been sold to a third party before Tronox LLC succeeded to the interests of a predecessor owner in the 1960's. The predecessor also did notoperate the site, which had been closed down before it was acquired by the predecessor. Based on historical records, there are substantialuncertainties about whether or under what terms the predecessor assumed liabilities for the site. In addition, although it appears there may beother PRPs, we do not know whether the other PRPs have received similar letters from EPA, whether there are any defenses to liabilityavailable to the other PRPs or whether any other PRPs have the financial resources necessary to meet their obligations. We intend to defendvigorously against EPA's demand. We have not recorded a reserve for reimbursement of clean up cost for the site as it is not possible toreliably estimate the liability, if any, we may have for the site because of the defenses discussed above and uncertainties.

Critical Accounting Policies

Preparation of financial statements in conformity with accounting principles generally accepted in the United States requires managementto make estimates, judgments and assumptions regarding matters that are inherently uncertain and that ultimately affect the reported amountsof assets, liabilities, revenues and expenses, and the disclosure of contingent assets and liabilities. Even so, the accounting principles we usegenerally do not impact our reported cash flows or liquidity. Generally, accounting rules do not involve a selection among alternatives, butinvolve a selection of the appropriate policies for applying the basic principles. Interpretation of the existing rules must be done and judgmentsmade on how the specifics of a given rule apply to us.

The more significant reporting areas impacted by management's judgments, estimates and assumptions are recoverability of long-livedassets, restructuring and exit activities, environmental remediation, tax accruals and benefit plans. Management's judgments, estimates andassumptions in these areas are based on information available from both internal and external sources, including engineers, legal counsel,actuaries, environmental studies and historical experience in similar matters. Actual results could differ materially from those judgments,estimates and assumptions as additional information becomes known.

The following description of our critical accounting policies is not intended to be an all-inclusive discussion of the uncertaintiesconsidered and estimates made by management in applying accounting principles and policies. Results may vary significantly if differentpolicies were used or required and if new or different information becomes known to management.

Long-Lived Assets

Key estimates related to long-lived assets include useful lives, recoverability of carrying values and existence of any retirementobligations. As a result of future decisions, such estimates could be significantly modified. The estimated useful lives of our property, plantand equipment range from three to 40 years and depreciation is recognized on the straight-line basis. Useful lives are estimated based upon ourhistorical experience, engineering estimates and industry information. Our estimates

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include an assumption regarding periodic maintenance and an appropriate level of annual capital expenditures to maintain the assets.

A long-lived asset is evaluated for potential impairment whenever events or changes in circumstances indicate that its carrying value maybe greater than its future net cash flows. Such evaluations involve a significant amount of judgment since the results are based on estimatedfuture events, such as sales prices; costs to produce the products; the economic and regulatory climates; and other factors. We cannot predictwhen or if future impairment charges will be required for held-for-use assets.

Restructuring and Exit Activities

We have recorded charges in recent periods in connection with closing facilities and work force reduction programs. These charges arerecorded when management commits to a plan and incurs a liability related to the plan. Estimates for plant closing include write-down ofinventory value, write-down of property, plant and equipment, any necessary environmental or regulatory costs, contract termination, assetretirement obligations and severance costs. Estimates for work force reductions are recorded based on estimates of the number of positions tobe terminated, termination benefits to be provided, estimates of any enhanced benefits provided under pension and postretirement plans andthe period over which future service will continue, if any. We evaluate the estimates on a quarterly basis and adjust the reserves wheninformation indicates that the estimates are above or below the initial estimates. For additional information regarding work force reductionprograms and exit activities, see note 15 to the audited combined financial statements included elsewhere in this prospectus. Changes inestimates of provisions for restructuring and exit activities were not significant over the last three years.

Environmental Remediation and Other Contingency Reserves

Our management makes judgments and estimates in accordance with applicable accounting rules when it establishes reserves forenvironmental remediation, litigation and other contingent matters. Provisions for such matters are charged to expense when it is probable thata liability has been incurred and reasonable estimates of the liability can be made. Estimates of environmental liabilities, which include thecost of investigation and remediation, are based on a variety of matters, including, but not limited to, the stage of investigation, the stage of theremedial design, the availability of existing remediation technologies, presently-enacted laws and regulations and the state of any related legalor administrative investigation or proceedings. In future periods, a number of factors could significantly change our estimate of environmentalremediation costs, such as changes in laws and regulations, revisions to the remedial design, unanticipated construction problems,identification of additional areas or volumes of contamination, and increases in labor, equipment and technology costs, changes in thefinancial condition of other potentially responsible parties and the outcome of any related legal and administrative proceedings to which weare or may become a party. Consequently, it is not possible for us to reliably estimate the amount and timing of all future expenditures relatedto environmental or other contingent matters, and our actual costs could exceed our current reserves.

Before considering reimbursements of our environmental costs discussed below, we provided $81.4 million, $88.2 million and$188.1 million pre-tax for environmental remediation and restoration costs in 2004, 2003 and 2002, respectively, including provisions of$75.7 million, $52.3 million and $173.8 million in 2004, 2003 and 2002, respectively, related to former businesses reflected as a component ofloss from discontinued operations.

To the extent costs of investigation and remediation are recoverable from the U.S. government under Title X and have been incurred orare recoverable under insurance policies and such recoveries are deemed probable, we record a receivable. In considering the probability ofreceipt, we evaluate our historical experience with receipts, as well as our claim submission experience. At December 31, 2004,

69



estimated recoveries of environmental costs recorded in the combined balance sheet totaled $93.8 million, of which $65.7 million wasreceived in early 2005. Provisions for environmental remediation and restoration in the combined statement of operations were reduced by$14.2 million, $32.2 million and $112.7 million in 2004, 2003 and 2002, respectively, for estimated recoveries, including recoveries of$14.2 million, $11.2 million and $112.7 million in 2004, 2003 and 2002, respectively, related to former businesses reflected as a component ofloss from discontinued operations.

For additional information about contingencies, refer to "�Environmental Matters" above and note 21 to the audited combined financialstatements and note 10 to the interim unaudited condensed combined financial statements included elsewhere in this prospectus.

Income Taxes

Historically, we have been included in the consolidated tax return of Kerr-McGee. We have not historically been a party to a tax-sharingagreement with Kerr-McGee but have consistently followed an allocation policy whereby Kerr-McGee has allocated to the members of itsconsolidated return provisions or benefits based upon each member's taxable income or loss. This allocation methodology results in therecognition of deferred assets and liabilities for the differences between the financial statement carrying amounts and their respective taxbasis, except to the extent for deferred taxes on income considered to be permanently reinvested in foreign jurisdictions. Deferred tax assetsand liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences areexpected to be recovered or settled. Kerr-McGee has allocated current tax benefits to the members of its consolidated return, including us, thathave generated losses that are utilized or expected to be utilized on the consolidated return. This allocation methodology is not consistent withthat calculated on a stand-alone tax return basis. In addition, Kerr-McGee manages its tax position for the benefit of its entire portfolio ofbusinesses, and its tax strategies are not necessarily reflective of those tax strategies that we would have followed as a stand-alone company.

We intend to enter into a tax sharing agreement with Kerr-McGee that will govern Kerr-McGee's and our respective rights,responsibilities and obligations after this offering with respect to taxes for tax periods ending in 2005 and prior. Generally, taxes incurred oraccrued prior to this offering that are attributable to the business of one party will be borne solely by that party. In addition, the tax sharingagreement addresses the allocation of liability for taxes incurred as a result of restructuring activities undertaken to implement the separationand distribution. We are required to indemnify Kerr-McGee for any tax liability incurred by reason of the Distribution by Kerr-McGee of ourClass B common stock to its stockholders being considered a taxable transaction to Kerr-McGee as a result of a breach of any of ourrepresentations, warranties or covenants contained in the tax sharing agreement.

Under U.S. federal income tax laws, we and Kerr-McGee are jointly and severally liable for Kerr-McGee's federal income taxesattributable to the periods prior to and including Kerr-McGee's current taxable year, which ends on December 31, 2005. If Kerr-McGee failsto pay the taxes attributable to it under the tax sharing agreement for periods prior to and including its current taxable year, we could be liablefor any part of, including the whole amount of, these tax liabilities.

Benefit Plans

U.S. Plans. Our U.S. employees participate in the noncontributory defined benefit retirement plans and the contributory postretirementplans for health care and life insurance sponsored by Kerr-McGee. Our combined results of operations reflect costs associated with Kerr-McGee's U.S. plans which are allocated by Kerr-McGee based on salary for defined benefit retirement plans and based on active headcountfor postretirement plans, but do not reflect assets and liabilities associated with our

70



employees' participation in the plans, since we were not the plan sponsor for the historical periods presented.

Effective upon completion of the Distribution, we intend to establish a U.S. tax-qualified defined benefit retirement plan and related trustfor our employees and former employees who participated in Kerr-McGee's defined benefit retirement plans at the Distribution date. Inconnection with our assumption of obligations, Kerr-McGee will transfer assets from the trust for Kerr-McGee's defined benefit retirementplans to the trust we will establish. It is anticipated that our defined benefit obligation for this plan, determined on a plan termination basis asset forth in the employee benefits agreement, will be approximately $442 million and will be underfunded by approximately $14.4 million atthe Distribution date.

We also intend to establish postretirement benefit plans for health care and life insurance and health and welfare benefits, which weexpect will be an unfunded plan that will have comparable features to the plan currently maintained by Kerr-McGee. In connection with theestablishment of our postretirement plans, we anticipate that the projected benefit obligation relating to all eligible retired and active vestedparticipants related to us of approximately $148.0 million will be assumed by us upon completion of the Distribution.

To measure plan obligations and attribute cost to periods when employee services are provided, we will form various assumptions relatedto the newly established plans, including discount rate, rate of compensation increases, long-term rate of return, mortality and retirement rates,inflation and health care cost trend rate, among others. Some of these assumptions are specific to us and our employee groups covered, and,therefore, are expected to be different from assumptions formed by Kerr-McGee for its plans. Therefore, application of such assumptions byus may result in materially different amounts of net periodic cost (benefit) recognized in financial statements in future periods compared to thenet periodic cost (benefit) historically allocated to us by Kerr-McGee (amounts historically allocated are presented in note 18 to the auditedcombined financial statements included elsewhere in this prospectus). Further, we currently do not reflect any assets or liabilities associatedwith Kerr-McGee's U.S. defined benefit retirement and postretirement plans.

Foreign Benefit Plans. We currently provide defined benefit retirement plans for employees in Germany and the Netherlands andaccount for these plans in accordance with FAS No. 87, "Employers' Accounting for Pensions." The various assumptions used and theattribution of the costs to periods of employee service are fundamental to the measurement of net periodic cost and pension obligationsassociated with the retirement plans.

The following are considered significant assumptions related to our foreign retirement plans:

�� Long-term rate of return (applies to our plan in the Netherlands only);

�� Discount rate; and

�� Rate of compensation increases.

Other factors considered in developing actuarial valuations include inflation rates, retirement rates, mortality rates and other factors.Assumed inflation rates are based on an evaluation of external market indicators. Retirement rates are based primarily on actual planexperience. Long-term rate of return assumption for the Netherlands plan is developed considering the portfolio mix and country-specificeconomic data that includes the rates of return on local government and corporate bonds. Discount rate assumption is based on local corporatebond index rates. We determine rate of compensation increases assumption based on our long-term plans for compensation increases specificto employee groups covered. The assumed rate of salary increases includes the effects of merit increases, promotions and general inflation.Additional information regarding the significant assumptions relevant to the determination of the net periodic pension cost and the actuariallydetermined present value of

71



the benefit obligations is included in note 18 to the audited combined financial statements included elsewhere in this prospectus.

New/Revised Accounting Standards

In November 2004, the FASB issued FAS No. 151, "Inventory Costs�an Amendment of ARB No. 43, Chapter 4," which requires thatabnormal amounts of idle facilities cost, freight, handling costs and spoilage be expensed as incurred and not capitalized as inventory. FASNo. 151 is effective for inventory costs incurred during fiscal years beginning after June 15, 2005. We will adopt the standard effectiveJanuary 1, 2006. The effect of adoption is not expected to have a material effect on our financial position or results of operations.

In December 2004, the FASB issued FASB Staff Position No. FAS 109-2 (FSP No. 109-2), "Accounting and Disclosure Guidance forthe Foreign Earnings Repatriation Provisions within the American Jobs Creation Act of 2004" (the Jobs Act). FSP No. 109-2 providesguidance with respect to reporting the potential impact of the repatriation provisions of the Jobs Act on an enterprise's income tax expense anddeferred tax liability. The Jobs Act was enacted on October 22, 2004, and provides for a temporary 85% dividends received deduction oncertain foreign earnings repatriated during a one-year period. The deduction would result in an approximate 5.25% federal tax rate on therepatriated earnings. Additionally, withholding taxes may be due in certain tax jurisdictions. To qualify for the deduction, the earnings must bereinvested in the United States pursuant to a domestic reinvestment plan established by a company's chief executive officer and approved by acompany's board of directors. Other criteria in the Jobs Act must be satisfied as well. FSP No. 109-2 states that an enterprise is allowed timebeyond the financial reporting period to evaluate the effect of the Jobs Act on its plan for reinvestment or repatriation of foreign earnings. Asof December 31, 2004, management had not decided on whether, and to what extent, foreign earnings might be repatriated by us under theJobs Act, and accordingly, the combined financial statements do not reflect any provision for taxes on unremitted earnings. During the secondquarter of 2005, our management completed its analysis of the impact of the Jobs Act on our plan for repatriation. Based on this analysis, wehave repatriated $121 million in extraordinary dividends, as defined in the Jobs Act, during the first nine months of 2005, which resulted inrecognizing income tax expense of $4.5 million, net of foreign tax credits.

In December 2004, the FASB issued Statement No. 123 (revised 2004), "Share-Based Payment" (FAS No. 123R), which replaces FASNo. 123 and supersedes APB Opinion No. 25, "Accounting for Stock Issued to Employees." FAS No. 123R requires all share-based paymentsto employees, including grants of employee stock options, to be recognized in the financial statements based on their fair values beginningwith the first interim period after June 15, 2005, with early adoption encouraged. In April 2005, the SEC amended its rule to allow publiccompanies more time to implement the standard. Following the SEC's rule, we intend to implement FAS No. 123R effective January 1, 2006.The pro forma disclosures previously permitted under FAS No. 123 no longer will be an alternative to financial statement recognition. UnderFAS No. 123R, we must determine the appropriate fair value model to be used for valuing share-based payments, the amortization method forcompensation cost and the transition method to be used at the date of adoption. We plan to adopt the standard using the modified prospectivemethod, as permitted by the standard. The modified prospective method requires the compensation expense be recorded for all unvested share-based compensation awards at the beginning of the first quarter of adoption. We expect that the adoption will not have a material effect on ourfinancial condition and cash flows. We are evaluating the effect of adoption on our results of operations, which will depend, in part, on thetypes and quantities of stock-based awards that we will issue to our employees under the new long term incentive plan we intend to establishupon completion of this offering.

In March 2005, the FASB issued FASB Interpretation No. 47, "Accounting for Conditional Asset Retirement Obligations" (FIN No. 47)to clarify that an entity must recognize a liability for the fair value

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of a conditional asset retirement obligation when incurred, if the liability's fair value can be reasonably estimated. Conditional asset retirementobligations under this pronouncement are legal obligations to perform asset retirement activities when the timing and (or) method ofsettlement are conditional on a future event or may not be within the control of the entity. FIN No. 47 also provides additional guidance forevaluating whether sufficient information to reasonably estimate the fair value of an asset retirement obligation is available. FIN No. 47 iseffective for us as of December 31, 2005. We do not expect implementation of this pronouncement to have a material effect on the financialstatements, unless additional information enabling us to estimate the fair value of our conditional asset retirement obligations becomesavailable in future periods.

In May 2005, the FASB issued FAS No. 154, "Accounting Changes and Error Corrections" (FAS No. 154), which will require that,unless it is impracticable to do so, a change in an accounting principle be applied retrospectively to prior periods' financial statements for allvoluntary changes in accounting principles and upon adoption of a new accounting standard if the standard does not include specific transitionprovisions. FAS No. 154 supersedes Accounting Principles Board Opinion No. 20, "Accounting Changes" (APB No. 20), which previouslyrequired that most voluntary changes in accounting principles be recognized by including in the current period's net income (loss) thecumulative effect of changing to the new accounting principle. FAS No. 154 also provides that if an entity changes its method of depreciation,amortization, or depletion for long-lived, nonfinancial assets, the change must be accounted for as a change in accounting estimate. UnderAPB No. 20, such a change would have been reported as a change in an accounting principle. FAS No. 154 will be applicable to accountingchanges and error corrections made by the company starting in 2006. The effect on us of applying this new standard will depend upon whethermaterial voluntary changes in accounting principles, changes in estimates or error corrections occur and transition and other provisionsincluded in new accounting standards.

Quantitative and Qualitative Disclosure about Market Risk

We are exposed to market risks, including credit risk, from fluctuations in foreign currency exchange rates and natural gas prices. Toreduce the impact of these risks on earnings and to increase the predictability of cash flows, from time to time, we enter into derivativecontracts, primarily forward contracts to buy and sell foreign currencies. In addition to information included in this section, see notes 2 and 12to the audited combined financial statements and note 4 to the interim unaudited condensed combined financial statements included elsewherein this prospectus.

Foreign Currency Exchange Rate Risk

The U.S. dollar is the functional currency for our international operations, except for our European operations, for which the euro is thefunctional currency. Periodically, we enter into forward contracts to buy and sell foreign currencies. Certain of our contracts for the purchaseof Australian dollars and the sale of euros have been designated and have qualified as cash flow hedges of our anticipated future cash flowsrelated to pigment sales, raw material purchases and operating costs. These contracts generally have durations of less than three years.Changes in the fair value of these contracts are recorded in accumulated other comprehensive income (loss) and are recognized in earnings inthe periods during which the hedged forecasted transactions affect earnings.

We have entered into other forward contracts to sell foreign currencies, which will be collected as a result of pigment sales denominatedin foreign currencies, primarily in European currencies. These contracts have not been designated as hedges even though they do protect usfrom changes in foreign currency rates. Accordingly, gains or losses on such contracts are recognized in earnings as incurred.

The following table presents the notional amounts at the contract exchange rates and the weighted-average contractual exchange rates forcontracts to purchase (sell) foreign currencies

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outstanding at year-end 2004 and 2003. All amounts are U.S. dollar equivalents. The estimated fair value of our foreign currency forwardcontracts is based on the year-end forward exchange rates quoted by financial institutions. At December 31, 2004 and 2003, the net fair valueof our foreign currency forward contracts was a liability of $3.6 million and a net asset of $6.6 million, respectively. The net fair value atSeptember 30, 2005 was an asset of $1.7 million.

NotionalAmount

Weighted-Average

Contract Rate(millions of dollars,

except average contract rates)

Open contracts at December 31, 2004,Maturing in 2005:

Euro $ (72) 1.2998Japanese yen (1) .0095New Zealand dollar (1) .6873British pound sterling (1) 1.8043

Open contracts at December 31, 2003,Maturing in 2004:

Euro $ (57) 1.1115Japanese yen (2) .0092New Zealand dollar (1) .6121Australian dollar 38 .5366British pound sterling (1) 1.6876

Natural Gas Derivatives

From time to time, we enter into financial derivative instruments that generally fix the commodity prices to be paid for a portion of ourforecasted natural gas purchases. These contracts have been designated and qualified as cash flow hedges. As such, the resulting changes infair value of these contracts, to the extent effective in achieving their risk management objective, are recorded in accumulated othercomprehensive income. At December 31, 2004 and 2003, the fair value of natural gas derivative assets included in our combined balancesheet was $2.0 million and $0.8 million, respectively. These amounts will be recognized in earnings in the periods during which the hedgedforecasted transactions affect earnings (i.e., when the natural gas is purchased). No material changes in our natural gas derivative positionsoccurred in the first nine months of 2005.

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INDUSTRY BACKGROUND

We are one of the leading global producers and marketers of titanium dioxide pigments. We also produce a variety of electrolytic andother specialty chemical products.

Titanium Dioxide

Titanium dioxide, or TiO2, is a white pigment used in a wide range of products for its exceptional ability to impart whiteness, brightnessand opacity. TiO2 is a critical component of everyday applications, such as coatings, plastics and paper, as well as many specialty productssuch as inks, foods and cosmetics. Titanium dioxide is widely considered to be superior to alternative white pigments in large part due to itshiding power, which is the ability to cover or mask other materials effectively and efficiently. For example, titanium dioxide's hiding powerhelps prevent show-through on printed paper materials (making the materials easier to read) and a high concentration of titanium dioxidewithin paints reduces the number of coats needed to cover a surface effectively. Titanium dioxide is designed, marketed and sold based onspecific end-use applications.

The global titanium dioxide market is characterized by a small number of large global producers. In addition to our company, there arefour other major producers: E.I. du Pont de Nemours and Company, Millennium Chemicals Inc., Huntsman Corporation and KronosWorldwide, Inc. These five major producers accounted for approximately 70% of the global market in 2004, according to reports by theseproducers.

We estimate based on reported industry sales by the leading titanium dioxide producers that global sales of titanium dioxide in 2004exceeded 4.6 million tonnes, generating approximately $9 billion in industry-wide revenues. Because titanium dioxide is a "quality of life"product, its consumption growth is closely tied to a given region's economic health and correlates over time to the growth in its average grossdomestic product. According to industry estimates, titanium dioxide consumption has been growing at a compounded annual growth rate ofapproximately 2.8% over the past decade. The charts below summarize the global demand for titanium dioxide in 2004 by geography and end-use market based on total reported sales by the leading titanium dioxide producers and other industry sources:

2004 Global TiO2 Demand by Geography 2004 Global TiO2 Demand by End-Use Market

Although there are other white pigments on the market, we believe that titanium dioxide has no effective substitute because no otherwhite pigment has the physical properties for achieving comparable opacity and brightness or can be incorporated in as cost-effective amanner. In an effort to optimize titanium dioxide's cost-to-performance ratio in certain applications, some customers also use pigment"extenders," such as synthetic pigments, kaolin clays and calcium carbonate. We estimate that the impact on our total sales from the use ofsuch extenders is minimal.

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Titanium Dioxide Outlook

The global end-use market demand for titanium dioxide is cyclical, which closely affects its pricing. The period from late 2000 through2003, for example, was a period of unusually weak business conditions attributable to various factors, including the global economicrecession, exceptionally rainy weather conditions in Europe and the Americas that limited the painting season, and the outbreak of SARS inAsia. These factors reduced demand for titanium dioxide, which resulted in global over-supply. The resulting decline in titanium dioxideprices during this period led several major titanium dioxide producers to reduce production and working capital levels and to engage in othercapacity rationalization measures.

A general improvement in global economic conditions in late 2004 drove increased demand for titanium dioxide. Increased demandcoupled with reduced supply led to price increases in the last half of 2004 and early 2005. We believe that current industry dynamics show asustainable improving trend. With no major plant construction projects commenced, and considering that it typically takes two to four years tobring on significant new capacity, we expect the current high capacity utilization rates to continue in the near term. We believe limitedexpected capacity additions over the next several years, when combined with improving demand, will result in increasing margins.

Manufacturing Titanium Dioxide

Production Process. Titanium dioxide pigment is produced using a combination of processes involving the manufacture of basepigment particles followed by surface treatment, drying and milling (collectively known as finishing). There are two commercial productionprocesses in use: the chloride process and the sulfate process. The chloride process is a newer technology and has several advantages over thesulfate process: it generates less waste, uses less energy, is less labor intensive and permits the direct recycle of a major process chemical,chlorine, back into the production process. In addition, as described below under "�Types of Titanium Dioxide," titanium dioxide producedusing the chloride process is preferred for many of the largest end-use applications. As a result, the chloride process currently accounts forsubstantially all of the titanium dioxide production capacity in North America and approximately 60% of worldwide capacity. Since the late1980s, the vast majority of titanium dioxide production capacity that has been built uses the chloride process.

In the chloride process, feedstock ores (titanium slag, synthetic rutile, natural rutile or ilmenite ores) are reacted with chlorine (thechlorination step) and carbon to form titanium tetrachloride (TiCl4) in a continuous fluid bed reactor. Purification of TiCl4 to remove otherchlorinated products is accomplished using a distillation process. The purified TiCl4 is then oxidized in a vapor phase form to produce basepigment particles and chlorine gas. The latter is recycled back to the chlorination step for reuse. Base pigment is then typically slurried withwater and dispersants prior to entering the finishing step.

In the sulfate process, batch digestion of ilmenite ore or titanium slag is carried out with concentrated sulfuric acid to form soluble titanylsulfate. After treatment to remove soluble and insoluble impurities and concentration of the titanyl sulfate, hydrolysis of the liquor forms aninsoluble hydrous titanium oxide. This precipitate is filtered, bleached, washed and calcined to produce a base pigment that is then forwardedto the finishing step.

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The schematic diagram below illustrates the basic steps of the chloride and sulfate processes and a representation of a finishing processcommon to both.

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Types of Titanium Dioxide. Commercial production of titanium dioxide results in one of two different crystal forms, either rutile oranatase. Rutile titanium dioxide is preferred over anatase titanium dioxide for many of the largest end-use applications, such as coatings andplastics, because its higher refractive index imparts better hiding power at lower quantities than the anatase crystal form. Although rutiletitanium dioxide can be produced using either the chloride process or the sulfate process, customers often prefer rutile produced using thechloride process because it typically has a bluer undertone and greater durability.

Anatase titanium dioxide can only be produced using the sulfate process and has applications in paper, rubber, fibers, ceramics, foods andcosmetics. It is not recommended for outdoor applications because it is less durable than rutile titanium dioxide.

Electrolytic and Other Chemical Products

Battery Materials

The battery industry uses electrolytic manganese dioxide (EMD) as the active cathode material for primary (non-rechargeable) batteriesand lithium manganese oxide and lithium vanadium oxide in rechargeable lithium batteries. Battery applications account for nearly all of theconsumption of these chemicals.

The primary battery market is composed of alkaline and zinc carbon battery technologies to address the various power deliveryrequirements of a multitude of consumer battery-powered devices. Approximately 85% of market demand in the United States is for alkalinebatteries, which are higher performing and more costly than batteries using the older zinc carbon technology. EMD quality requirements foralkaline technology are much more demanding than for zinc carbon technology and, as a result, alkaline-grade EMD commands a higher pricethan zinc carbon-grade EMD. The older zinc carbon technology remains dominant in developing countries such as China and India. As theeconomies of China and India continue to mature, and the need for more efficient energy sources develops, we anticipate that the demand foralkaline-grade EMD will increase.

The market application for rechargeable lithium batteries is consumer electronics, in particular cell phones, computers, camcorders and,most recently, power tools. A combination of improved power delivery performance and lighter weight has allowed rechargeable lithiumtechnology to displace older lead acid and nickel cadmium technologies.

Sodium Chlorate

The pulp and paper industry accounts for over 95% of the market demand for sodium chlorate, which uses it to bleach pulp. Althoughthere are other methods for bleaching pulp, the chlorine dioxide process is preferred for environmental reasons. Approximately 60% of NorthAmerican sodium chlorate production capacity is located in Canada due to the availability of lower cost hydroelectric power, which reducesmanufacturing costs and ultimately, product prices. However, transportation costs also affect product pricing. We believe that the proximity ofdomestic sodium chlorate producers to the major domestic pulp and paper producers helps offset the lower-cost power advantage enjoyed byCanadian sodium chlorate producers.

Boron

There are two types of boron specialty chemicals: boron trichloride and elemental boron. Boron trichloride is a specialty chemical that isused in many products, including pharmaceuticals, semiconductors, high-performance fibers, specialty ceramics and epoxies. Elemental boronis a specialty chemical that is used in igniter formulations for the defense, pyrotechnic and automotive air bag industries.

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BUSINESS

Overview

Tronox is one of the leading global producers and marketers of titanium dioxide pigment. We market titanium dioxide pigment, whichrepresented more than 90% of our net sales in 2004, under the brand name TRONOX®. We are the world's third largest producer andmarketer of titanium dioxide based on reported industry capacity by the leading titanium dioxide producers, and we have an estimated 13%market share of the $9 billion global market in 2004 based on reported industry sales. Our world-class, high-performance pigment productsare critical components of everyday consumer applications, such as coatings, plastics and paper, as well as specialty products, such as inks,foods and cosmetics. In addition to titanium dioxide, we produce electrolytic manganese dioxide, sodium chlorate, boron-based and otherspecialty chemicals. In 2004, we had net sales of $1.3 billion and a net loss of $127.6 million. For the first nine months of 2005, we had netsales of $1.0 billion and net income of $12.6 million. Net sales from our United States operations were $716.8 million in 2004, $646.7 millionin 2003 and $602.8 million in 2002, and net sales from our international operations were $585.0 million in 2004, $511.0 million in 2003 and$461.5 million in 2002.

The chart below summarizes our 2004 net sales by business segment:

2004 Net Sales by Business Segment

We have maintained strong relationships with our customers since our current chemical operations began in 1964. We focus on providingour customers with world-class products, end-use market expertise and strong technical service and support. With over 2,150 employeesworldwide, strategically located manufacturing facilities and direct sales and technical service organizations in the United States, Europe andthe Asia-Pacific region, we are able to serve our diverse base of more than 1,100 customers in over 100 countries.

Globally, including all of the production capacity of the facility operated by our Tiwest Joint Venture (see "�Manufacturing, Operationand Properties�The Tiwest Joint Venture"), we have 517,000 and 107,000 tonnes of aggregate annual chloride and sulfate titanium dioxideproduction capacity, respectively. We hold over 200 patents worldwide, as well as other intellectual property. We have a highly skilled andtechnologically sophisticated workforce.

Competitive Strengths

We benefit from a number of competitive strengths, including the following:

Leading Market Positions

We are the world's third largest producer and marketer of titanium dioxide products based on reported industry capacity by the leadingtitanium dioxide producers and the world's second largest producer and supplier of titanium dioxide manufactured via proprietary chloridetechnology, which we

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believe is preferred for many of the largest end-use applications. We estimate that we have a 15% share of the $5.2 billion global market forthe use of titanium dioxide in coatings, which industry sources consider the largest end-use market. We believe our leading market positionsprovide us with a competitive advantage in retaining existing customers and obtaining new business.

Global Presence

We are one of the few titanium dioxide manufacturers with global operations. We have production facilities and a sales and marketingpresence in the Americas, Europe and the Asia-Pacific region. In 2004, sales into the Americas accounted for approximately 47% of our totaltitanium dioxide net sales, followed by approximately 32% into Europe and approximately 21% into the Asia-Pacific region. Our globalpresence enables us to provide customers in over 100 countries with a reliable source of multiple grades of titanium dioxide. The diversity ofthe geographic markets we serve also mitigates our exposure to regional economic downturns.

Well-Established Relationships with a Diverse Customer Base

We sell our products to a diverse portfolio of customers with whom we have well-established relationships. Our customer base consistsof more than 1,100 customers in over 100 countries and includes market leaders in each of the major end-use markets for titanium dioxide. Wehave supplied each of our top ten customers with titanium dioxide pigment for over ten years. We work closely with our customers tooptimize their formulations, thereby enhancing the use of titanium dioxide in their production processes. This has enabled us to develop andmaintain strong relationships with our customers, resulting in a high customer retention rate.

Innovative, High-Performance Products

We offer innovative, high-performance products for nearly every major titanium dioxide end-use application, with 35 grades of titaniumdioxide pigment currently available. We are dedicated to continually developing our titanium dioxide products to better serve our customersand responding to the increasingly stringent demands of their end-use markets. Our recently-introduced products, CR-826 and CR-880, offer acombination of optical properties, opacity, ease of dispersion and durability that is valued by customers for a variety of applications. Salesvolume of these high-performance, market-leading products increased at a compounded annual growth rate of 36% from 2000 to 2004.

Proprietary Production Technology

We are one of a limited number of producers in the titanium dioxide industry to hold the rights to a proprietary chloride process for theproduction of titanium dioxide. Approximately 83% of our gross production capacity uses this process technology, which is the subject ofnumerous patents worldwide and is utilized by our highly skilled and technologically sophisticated workforce. Titanium dioxide producedusing chloride process technology is preferred for many of the largest end-use applications. The chloride process generates less waste, usesless energy and is less labor intensive than the sulfate production process. The complexity of developing and operating the chloride processtechnology makes it difficult for others to enter and successfully compete in the chloride process titanium dioxide industry.

Experienced Management Team

Our management team has an average of 23 years of business experience. The diversity of their business experience provides a broadarray of skills that contributes to the successful execution of our business strategy. Our operations team and plant managers, who have anaverage of 27 years of manufacturing experience, participate in the development and execution of strategies that have resulted

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in production volume growth, production efficiency improvements and cost reductions. The experience, stability and leadership of our salesorganization have been instrumental in growing sales, developing and maintaining customer relationships and increasing our market share.

Business Strategy

We use specific and individualized operating measures throughout our organization to track and evaluate key metrics. This approachserves as a scorecard to ensure alignment with, and accountability for, the execution of our strategy, which includes the followingcomponents:

Strong Customer Focus

We target our key markets with innovative, high-performance products that provide enhanced value to our customers at competitiveprices. A key component of our business strategy is to enhance our product portfolio continually with high-quality, market-driven productdevelopment. We design our titanium dioxide products to satisfy our customers' specific requirements for their end-use applications and alignour business to respond quickly and efficiently to changes in market demands. In this regard, and in order to continue meeting our customers'needs, we expect to offer at least three new titanium dioxide pigment products in 2005 and 2006 that we believe will further enhance ourmarket positions.

Technological Innovation

We employ customer and end-use market feedback, technological expertise and fundamental research to create next-generation productsand processes. Our technology development efforts include building value-added properties into our titanium dioxide to enhance itsperformance in our customers' end-use applications. Our research and development teams support our future business strategies, and wemanage those teams using disciplined project management tools and a team approach to technological development.

Operational Excellence

We achieve operational excellence by improving equipment uptime and product quality while reducing maintenance and operating costs.We use Six Sigma, a business improvement methodology, to improve our operational performance. As a result, in 2004, we reduced annualenergy costs by $0.8 million at one of our plants, and decreased costs of goods sold by $1.5 million through improved yields at another.Targeting uptime with the Six Sigma methodology also recently enabled one of our plants to increase its annual production by 2,000 tonnesthrough a simple reconfiguration of its processing equipment.

Maximize Asset Efficiency

We optimize our production plan through strategic use of our global facilities to save on both transportation and warehousing costs. Ourproduction process is designed with multiple production lines. As a result, we can remedy issues with an individual line without shutting downother lines and idling an entire facility. We also actively manage production capability across all facilities. For instance, if one plant's finishinglines are already at full capacity, that plant's unfinished titanium dioxide can be transferred to another plant for finishing.

Supply Chain Optimization

We improve our supply chain efficiency by focusing on reducing both operating costs and working capital needs. Our supply chainefforts to lower operating costs consist of reducing procurement spending, lowering transportation and warehouse costs and optimizingproduction scheduling. We actively manage our working capital by increasing inventory turnover and reducing finished goods and

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raw materials inventory without affecting our ability to deliver titanium dioxide to our customers. As a result of our efforts, we reduced ourfinished goods inventory in 2004 by 27% while increasing sales volumes by approximately 9%.

Organizational Alignment

Aligning the efforts of our employees with our business strategies is critical to our success. To achieve that alignment, we evaluate theperformance of our employees using a balanced scorecard approach. We also invest in training initiatives that are directly linked to ourbusiness strategies. For instance, approximately 120 of our employees have completed the well-regarded supply chain management trainingprogram at Michigan State University's Broad Executive School of Management. We also train our employees in Six Sigma methodology tosupport our operational excellence and asset efficiency strategic objectives.

End-Use Markets and Applications

Titanium Dioxide

The major end-use markets for titanium dioxide products, which we sell in the Americas, Europe and the Asia-Pacific region, arecoatings, plastics and paper and specialty products. The charts below summarize our approximate 2004 net sales by geography and ourapproximate 2004 sales volume by end-use market:

2004 Net Sales by Geography 2004 Sales Volume by End-Use Market

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Coatings End-Use Market. The coatings end-use market represents the largest end-use market for titanium dioxide products andaccounts for approximately 60% of overall industry demand, based on reported industry sales volumes, and 65% of our 2004 sales volume.Customers in the coatings end-use market demand exceptionally high quality standards for titanium dioxide, especially with regard to opacity,durability, tinting strength and brightness. We recognize four sub-markets within the coatings end-use market based on application, each ofwhich requires different titanium dioxide formulations. The table below summarizes the sub-markets within coatings, as well as theirapplications and primary growth factors:

Sub-Market Applications Growth FactorsArchitectural Residential and commercial paints Housing market and interest rates

IndustrialAppliances, coil coatings, furniture andmaintenance

Durable goods spending and environmentalregulations

AutomotiveOriginal equipment manufacture, refinish andelectro-coating

Interest rates and environmental regulations

SpecialtyMarine and can coatings, packaging and trafficpaint

Fixed capital spending and government regulations

Plastics End-Use Market. The plastics end-use market accounts for approximately 20% of overall industry demand for titaniumdioxide, based on reported industry sales volumes, and 21% of our 2004 sales volume. Plastics producers focus on titanium dioxide's opacity,durability, color stability and thermal stability. We recognize four sub-markets within the plastics market based on application, each of whichrequires different titanium dioxide formulations. The table below summarizes the sub-markets within plastics, as well as their applications andprimary growth factors:

Sub-Market Applications Growth Factors

PolyolefinsFood packaging, plastic films and agriculturalfilms

Consumer non-durable goods spending

PVCVinyl windows, siding, fencing, vinyl leather,roofing and shoes

Construction and renovation markets and consumernon-durable goods spending

Engineering plasticsComputer housing, cell phone cases, washingmachines and refrigerators

Consumer durable goods spending and electronicsmarket

Other plastics Roofing and flooring Construction market and durable goods spending

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Paper and Specialty End-Use Market. The paper and specialty end-use market accounts for approximately 20% of overall industrydemand for titanium dioxide, based on reported industry sales volumes, and 14% of our 2004 sales volume. We recognize four sub-marketswithin paper and specialty based on application, each of which requires different titanium dioxide formulations. The table below summarizesthe sub-markets within paper and specialty, as well as their applications and primary growth factors:

Sub-Market Applications Growth Factors

Paper and paper laminateFilled paper, coated paper for print media,coated board for beverage container packaging,wallboard, flooring, cabinets and furniture

Consumer non-durable goods spending andconstruction and renovation markets

Inks and rubberPackaging, beverage cans, container printingand rubber flooring


Food and pharmaceuticalsCreams, sauces, capsules, sun screen, face andbody care products


Catalysts and electroceramicsAnti-pollution equipment (catalysts) forautomobiles and power-generators andproduction of capacitors and resistors

Environmental regulations and electronics


Our other product lines include chemicals for battery materials, sodium chlorate for pulp bleaching and boron-based specialty chemicals.The sub-markets for those products, together with their applications and growth factors, are as follows:

Product Sub-Market Applications Growth Factors

Battery materialsNon-rechargeable batterymaterials

Alkaline and zinc carbon batterymarkets


Battery materialsRechargeable batterymaterials

Rechargeable lithium batteries Consumer non-durable goods spending

Sodium Chlorate Pulp and paper industry Pulp bleaching Consumer non-durable goods spending

Boron Specialty chemical

Pharmaceuticals,semiconductors, high-performance fibers, specialtyceramics and epoxies


BoronDefense, pyrotechnic and airbag industries

Igniter formulations Consumer non-durable goods spending

Sales and Marketing

We supply titanium dioxide to a diverse customer base that includes market leaders in each of the major end-use markets for titaniumdioxide. In 2004, our ten largest customers represented approximately 32% of our total sales volume and no single customer accounted formore than 10%. In 2004, approximately 45% of our global production volume was covered by multi-year supply contracts.

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In addition to price and product quality, we compete on the basis of technical support and customer service. Our direct sales and technicalservice organizations carry out our sales strategy and work together to provide quality customer service. Our direct sales staff is trained in allof our products and applications. Because of the technical requirements of titanium dioxide applications, our technical service organizationand direct sales offices are supported by a regional customer service staff located in each of our major geographic markets.

Our sales and marketing strategy focuses on effective customer management through the development of strong relationships throughoutour company with our customers. We develop customer relationships and manage customer contact through our sales team, technical serviceorganization, research and development team, customer service team, plant operations personnel, supply chain specialists and seniormanagement. We believe that multiple points of customer contact facilitate efficient problem-solving, supply chain support, formulaoptimization and product co-development. By developing close relationships with our customers and providing well-designed products andservices, we are a value-added business partner.

Competitive Conditions

Titanium Dioxide

The global market in which our titanium dioxide business operates is highly competitive. Worldwide, we believe that we are one of onlyfive companies (including E.I. du Pont de Nemours and Company, Millennium Chemicals Inc., Huntsman Corporation and KronosWorldwide, Inc.) that use proprietary chloride process technology for production of titanium dioxide pigment. We estimate that, based ongross sales volumes, these companies accounted for approximately 70% of the global market share in 2004. We believe that cost efficiencyand product quality as well as technical and customer service are key competitive factors for titanium dioxide producers.

Titanium dioxide produced using chloride process technology is preferred for many of the largest titanium dioxide end-use applications;however, titanium dioxide produced using sulfate process technology is preferred for certain specialty applications. The following chartssummarize the estimated market share breakdown and production process mix for the five leading titanium dioxide pigment producers forfiscal year 2004:

2004 Global Market Share 2004 Production Process Mix

As of December 31, 2004, including the total production capacity of our Tiwest Joint Venture (see "�Manufacturing, Operations andProperties�The Tiwest Joint Venture"), we had global production capacity of 624,000 tonnes per year and an approximate 13% global marketshare. In addition to the major competitors discussed above, we compete with numerous smaller, regional producers, as well as producers inChina that have expanded their sulfate production capacity during the previous five years.

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Electrolytic Manganese Dioxide. With an 8% estimated global capacity share, we are a key producer of EMD. Other significantproducers and their estimated global capacity shares include Erachem (7%) in the United States, as well as international producers Delta(17%), Tosoh (15%), Xiangtan (11%) and Mitsui (7%). The remainder of global capacity is produced by various Chinese producers. The U.S.market accounts for approximately one third of global demand for EMD.

Sodium Chlorate. We have an estimated 6% share of North American sodium chlorate capacity. Our significant competitors and theirestimated share of North American capacity are ERCO (27%), Eka Chemicals (25%), Nexen (22%) and Finnish Chemicals (10%).

Other Specialties. For boron products, we believe that we have the majority of the installed capacity for boron trichloride. Other boronproduction capacity is located in Ireland, Japan and Russia.

Manufacturing, Operation and Properties

Titanium Dioxide

We produce titanium dioxide using either the chloride process or the sulfate process at five production facilities located in four countries.We believe our facilities are well-situated to serve our global customer base.

Two of our facilities are located in the United States and we have one facility in each of Australia, Germany and the Netherlands. Weown our facilities in Germany and the Netherlands, and the land under these facilities is held pursuant to long-term leases. We own ourdomestic facilities and hold a 50% undivided interest in our Australian facility. We market and sell all of the titanium dioxide produced by ourAustralian facility and share in the profits equally with our joint venture partner. See "�The Tiwest Joint Venture."

The following table summarizes our production capacity as of December 31, 2004, by location and process:

Titanium Dioxide Production CapacityAs of December 31, 2004(Gross tonnes per year)

Facility Capacity ProcessHamilton, Mississippi 225,000 ChlorideSavannah, Georgia 110,000 ChlorideKwinana, Western Australia 110,000(1) ChlorideBotlek, the Netherlands 72,000 ChlorideUerdingen, Germany 107,000 Sulfate

Total 624,000

(1)Reflects 100% of the production capacity of the pigment plant, which is owned 50% by us and 50% by our joint venture partner.

Including the titanium dioxide produced by our Australian facility and production volumes from our Savannah sulfate facility that wasclosed in September 2004, we produced 602,024 tonnes of titanium dioxide in 2004, compared to 578,913 tonnes in 2003 and 556,213 tonnesin 2002. Our average production rates, as a percentage of capacity, were 91%, 87% and 92%, in 2004, 2003 and 2002, respectively. Over thepast five years, production at our facilities increased by approximately 21%, primarily due to debottlenecking and low cost incrementalinvestments. Our global manufacturing

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presence, coupled with our ability to increase capacity incrementally, makes us a stable supplier to many of the largest titanium dioxideconsumers.

The Tiwest Joint Venture

Our subsidiary, KMCC Western Australia Pty. Ltd., has a 50% undivided interest in all of the assets that comprise the operationsconducted in Australia under the Tiwest joint venture arrangement and is severally liable for 50% of associated liabilities. The remaining 50%undivided interest is held by our joint venture partner, Ticor Limited. The joint venture partners operate a chloride process titanium dioxideplant located in Kwinana, Western Australia, as well as a mining venture in Cooljarloo, Western Australia, and a synthetic rutile processingfacility in Chandala, Western Australia. Under our joint venture agreements, we have the right to market our partner's share of the titaniumdioxide produced by the Kwinana facility. For more information regarding our facility in Kwinana, see "�Titanium Dioxide" above. For moreinformation regarding the mining venture, see "�Heavy Minerals" below.

Management. The operations associated with the Tiwest joint venture arrangement are governed by two committees: a managementcommittee and an operating committee. The operating committee meets at least monthly and supervises the joint venture's routine operations,and the management committee meets at least quarterly and has the authority to make fundamental corporate decisions and to overrule theoperating committee's decisions. The committees' decisions are made by simple majority approval. If there is an equal number of votes castfor and against a matter at an operating committee meeting, the matter is referred to a subsequent meeting. If at the subsequent meeting, thematter still receives an equal number of votes cast on each side, the matter is referred to the management committee. KMCC WesternAustralia and Ticor each have the right to appoint half of each committee's members.

Heavy Minerals. The joint venture partners mine heavy minerals from 21,027 acres under a long-term mineral lease from the State ofWestern Australia, for which each joint venture partner holds a 50% undivided interest. Our 50% undivided interest in the properties'remaining in-place proven and probable reserves is 5.6 million tonnes of heavy minerals contained in 214 million tonnes of sand averaging2.6% heavy minerals. The valuable heavy minerals are composed on average of 61.0% ilmenite, 10.0% zircon, 4.5% natural rutile and 3.4%leucoxene, with the remaining 21.1% of heavy minerals having no significant value.

Heavy-mineral concentrate from the mine is processed at a 750,000-tonne per year dry separation plant, for which each joint venturepartner holds a 50% undivided interest. Some of the recovered ilmenite is upgraded at the nearby synthetic rutile facility in Chandala, whichhas a capacity of 225,000 tonnes per year. Synthetic rutile is a high-grade titanium dioxide feedstock. All of the synthetic rutile feedstock forthe 110,000-tonne per year titanium dioxide plant located at Kwinana is provided by the Chandala processing facility. Production of feedstockin excess of the plant's requirements is sold to third parties, as well as to us, for the portion not already owned, as part of the feedstockrequirement for titanium dioxide at our other facilities.

Information regarding our 50% interest in heavy-mineral reserves, production and average prices for the three years ended December 31,2004, is presented in the following table. Mineral reserves in this table represent the estimated quantities of proven and probable ore that,under anticipated conditions, may be profitably recovered and processed for the extraction of their mineral content. Future production of theseresources depends on many factors, including market conditions and government regulations. See "Risk Factors�Risks Related to OurBusiness and Industry�Fluctuations in

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costs of our raw materials or our access to supplies of our raw materials could have an adverse effect on our results of operations."

Heavy-Mineral Reserves, Production and Prices(Reserves and production in tonnes)

2004 2003 2002Proven and probable reserves (as of year end) 5,570,000 5,970,000 5,700,000Production 302,000 294,000 289,000Average market price (per tonne) $ 161 $ 152 $ 150


We produce electrolytic and other chemical products at three domestic facilities, each of which we own. The following table summarizesour production capacity as of December 31, 2004, by location and product.

Electrolytic and Other Chemical CapacityAs of December 31, 2004(Gross tonnes per year)

Facility Capacity ProductHamilton, Mississippi 130,000 Sodium chlorateHenderson, Nevada 27,000 EMDHenderson, Nevada 525 Boron products

Soda Springs, Idaho 300Lithium manganese oxide andlithium vanadium oxide

Raw Materials

Titanium Dioxide

The primary raw materials that we use to produce titanium dioxide are various types of titanium-bearing ores, including ilmenite, naturalrutile, synthetic rutile, titanium-bearing slag and leucoxene. We generally purchase ores under multi-year agreements from a variety ofsuppliers in Australia, Canada, India, Norway, South Africa, Ukraine and the United States. We purchase approximately 47% of the titanium-bearing ores we require from two suppliers under long-term supply contracts that expire in 2007 through 2009. Approximately 85% of thesynthetic and natural rutile used by our facilities are obtained from the operations under the Tiwest joint venture arrangement. See"�Manufacturing, Operations and Properties�The Tiwest Joint Venture." We do not anticipate difficulties obtaining long-term extensions toour existing supply contracts prior to their expiration. Other significant raw materials include chlorine and petroleum coke for the chlorideprocess, which we obtain from many suppliers worldwide, and sulfuric acid for the sulfate process, which we produce ourselves.


The primary raw material that we use to produce sodium chlorate is sodium chloride, and for battery materials, manganese ore. Wepurchase these materials under multi-year agreements and spot contracts.

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Research and Development

Research and development is an integral component of our business strategy. Enhancing our product portfolio with high quality, market-focused product development is key in driving our business from the customer perspective.

We have approximately 70 scientists, chemists, engineers and skilled technicians to provide the technology (products and processes) forour business. Our product development personnel have a high level of expertise in the plastics industry and polymer additives, the coatingsindustry and formulations, surface chemistry, material science, analytical chemistry and particle physics. Among the process technologydevelopment group's highly developed skills are computational fluid dynamics, process modeling, particle growth physics, extractivemetallurgy, corrosion engineering and thermodynamics. The majority of scientists supporting our research and development efforts are locatedin Oklahoma City, Oklahoma. Our expenditures for research and development were approximately $6.3 million in 2004, $8.0 million in 2003and $7.5 million in 2002.

New process developments are focused on increased through-put, control of particle physical properties and general processingequipment-related issues. On-going development of process technology contributes to cost reduction, enhanced production flexibility,increased capacity and improved consistency of product quality.

In 2004, products developed in the last five years provided over 26% of our total titanium dioxide sales volume. We havecommercialized one new product in 2005 for the North American paper industry. Two additional products (one each for the plastics andcoatings end-use markets) are in the first stages of commercialization, and we anticipate full implementation of these products in 2006.

Patents and Other Intellectual Property

Patents held for our products and production processes are important to our long-term success. We seek patent protection for ourtechnology where competitive advantage may be obtained by patenting, and file for broad geographic protection given the global nature of ourbusiness. Our proprietary titanium dioxide technology is the subject of numerous patents worldwide, the substantial majority of which relate toour chloride products and production technology.

We also rely upon and have taken steps to secure our unpatented proprietary technology, know-how and other trade secrets. Ourproprietary chloride production technology is an important part of our overall technology position. We are committed to pursuingtechnological innovations in order to maintain our competitive position.

Employees

Following completion of this offering, we anticipate that we will have approximately 2,150 employees, with approximately 1,260 in theUnited States, 860 in Europe, and 30 in Australia. Approximately 16% of our employees in the United States are represented by collectivebargaining agreements, and approximately 95% of our employees in Europe are represented by works' councils. We consider relations withour employees to be good.

Government Regulations and Environmental Matters

General

We are subject to extensive regulation by federal, state, local and foreign governments. Governmental authorities regulate the generationand treatment of waste and air emissions at our operations and facilities. At many of our operations, we also comply with worldwide,voluntary standards such as ISO 9002 for quality management and ISO 14001 for environmental management.



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ISOs are standards developed by the International Organization for Standardization, a nongovernmental organization that promotes thedevelopment of standards and serves as an external oversight for quality and environmental issues.

Environmental Matters

A variety of laws and regulations relating to environmental protection affect almost all of our operations. Under these laws, we are ormay be required to obtain or maintain permits or licenses in connection with our operations. In addition, these laws require us to remove ormitigate the effects on the environment of the disposal or release of chemical, petroleum, low-level radioactive and other substances at varioussites. Operation of pollution-control equipment usually entails additional expense. Some expenditures to reduce the occurrence of releases intothe environment may result in increased efficiency; however, most of these expenditures produce no significant increase in productioncapacity, efficiency or revenue.

During 2004, direct capital and operating expenditures related to environmental protection and cleanup of operating sites totaled$32.1 million. Additional expenditures totaling $85.2 million were charged against reserves for environmental remediation and restoration.While it is difficult to estimate the total direct and indirect costs of government environmental regulations on our operations, we estimate thatin 2005 and 2006 we will incur $8.6 million and $10.0 million, respectively, in direct capital expenditures, $23.8 million and $24.7 million,respectively, in operating expenditures and $71.0 million and $74.0 million, respectively, in expenditures charged to reserves.

We are party to a number of legal and administrative proceedings involving environmental matters or other matters pending in variouscourts or agencies. These include proceedings associated with businesses and facilities currently or previously owned, operated or used by ouraffiliates or their predecessors, and include claims for personal injuries, property damages, breach of contract, injury to the environment,including natural resource damages, and non-compliance with permits. Our current and former operations also involve management ofregulated materials and are subject to various environmental laws and regulations. These laws and regulations obligate us to clean up varioussites at which petroleum and other hydrocarbons, chemicals, low-level radioactive substances or other materials have been contained, disposedof or released. Some of these sites have been designated Superfund sites by the U.S. Environmental Protection Agency pursuant to theComprehensive Environmental Response, Compensation, and Liability Act of 1980 and are listed on the National Priority List.

We provide for costs related to environmental contingencies when a loss is probable and the amount is reasonably estimable. It is notpossible for us to reliably estimate the amount and timing of all future expenditures related to environmental matters because, among otherreasons:

�� some sites are in the early stages of investigation, and other sites may be identified in the future;

�� remediation activities vary significantly in duration, scope and cost from site to site depending on the mix of unique sitecharacteristics, applicable technologies and regulatory agencies involved;

�� remediation requirements are difficult to predict at sites where investigations have not been completed or final decisions havenot been made regarding remediation requirements, technologies or other factors that bear on remediation costs;

�� environmental laws frequently impose joint and several liability on all potentially responsible parties, and it can be difficult todetermine the number and financial condition of other potentially responsible parties and their respective shares ofresponsibility for remediation costs;

�� environmental laws, as well as enforcement policies, are continually changing, and the outcome of court proceedings anddiscussions with regulatory agencies are inherently uncertain;



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�� unanticipated construction problems and weather conditions can hinder the completion of environmental remediation;

�� the inability to implement a planned engineering design or use planned technologies and excavation methods may requirerevisions to the design of remediation measures, which delay remediation and increase its costs; and

�� the identification of additional areas or volumes of contamination and changes in costs of labor, equipment and technologygenerate corresponding changes in environmental remediation costs.

We believe that we have reserved adequately for the reasonably estimable costs of contingencies. However, additions to the reserves maybe required as additional information is obtained that enables us to better estimate our liabilities, including any liabilities at sites now underreview. We cannot reliably estimate the amount of future additions to the reserves at this time. Additionally, there may be other sites where wehave potential liability for environmental-related matters but for which we do not have sufficient information to determine that the liability isprobable and/or reasonably estimable. We have not established reserves for such sites.

For additional discussion of environmental matters, see "Management's Discussion and Analysis of Financial Condition and Results ofOperations," and note 21 to the audited combined financial statements and note 10 to the interim unaudited condensed combined financialstatements included elsewhere in this prospectus.

Legal Proceedings

New Jersey Wood-Treatment Site

In 1999, Tronox LLC was named as a PRP under CERCLA at a former New Jersey wood-treatment site at which EPA is conducting acleanup. On April 15, 2005, Tronox LLC and its ultimate parent, Kerr-McGee Corporation, received a letter from EPA asserting that they areliable under CERCLA as a former owner or operator of the site and demanding reimbursement of costs expended by EPA at the site. Thedemand is for payment of past costs in the amount of approximately $179 million, plus interest. Tronox LLC did not operate the site, whichhad been sold to a third party before Tronox LLC succeeded to the interests of a predecessor owner in the 1960's. The predecessor also did notoperate the site, which had been closed down before it was acquired by the predecessor. Based on historical records, there are substantialuncertainties about whether or under what terms the predecessor assumed liabilities for the site. In addition, although it appears there may beother PRPs, we do not know whether the other PRPs have received similar letters from EPA, whether there are any defenses to liabilityavailable to the other PRPs or whether any other PRPs have the financial resources necessary to meet their obligations. We intend to defendvigorously against EPA's demand. We have not recorded a reserve for reimbursement of clean up cost for the site as it is not possible toreliably estimate the liability, if any, we may have for the site because of the defenses discussed above and uncertainties.

Savannah Plant Emissions

On September 8, 2003, the Environmental Protection Division of the Georgia Department of Natural Resources issued a unilateralAdministrative Order to our subsidiary, Kerr-McGee Pigments (Savannah) Inc., claiming that the Savannah plant exceeded emissionallowances provided for in the facility's Title V air permit. On September 19, 2005, the Environmental Protection Division rescinded theAdministrative Order and filed a Withdrawal of Petition for Hearing on Civil Penalties. Accordingly, the proceeding on administrativepenalties has been dismissed. However, the Environmental Protection Division's most recent actions do not resolve the alleged violations, andrepresentatives of Kerr-McGee Pigments (Savannah) Inc., the Environmental Protection Division and

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EPA are engaged in discussions to resolve the existing air permit disputes and potential civil penalties. We believe that any penalties related tothis matter will not have a material adverse effect on us.

Forest Products Litigation

Between 1999 and 2001, Tronox LLC was named in 22 lawsuits in three states (Mississippi, Louisiana and Pennsylvania) in connectionwith former forest products operations located in those states (in Columbus, Mississippi; Bossier City, Louisiana; and Avoca, Pennsylvania).The lawsuits sought recovery under a variety of common law and statutory legal theories for personal injuries and property damages allegedlycaused by exposure to and/or release of creosote and other substances used in the wood-treatment process. Tronox LLC has executedsettlement agreements that are expected to resolve substantially all of the Louisiana, Pennsylvania and Mississippi lawsuits described above.Resolution of the remaining cases is not expected to have a material adverse effect on us.

Following the adoption by the Mississippi legislature of tort reform, plaintiffs' lawyers filed many new lawsuits across the state ofMississippi in advance of the reform's effective date. On December 31, 2002, August 31, 2004, September 27, 2004 and May 2, 2005,approximately 250 lawsuits were filed against Tronox LLC on behalf of approximately 5,100 claimants in connection with Tronox LLC'sColumbus, Mississippi, operations, seeking recovery on legal theories substantially similar to those advanced in the litigation referred toabove. Substantially all of these lawsuits were filed in or have been removed to the U.S. District Court for the Northern District of Mississippi,and the court has consolidated these lawsuits for pretrial and discovery purposes. On December 31, 2002, June 13, 2003, and June 25, 2004,three lawsuits were filed against Tronox LLC in connection with a former wood-treatment plant located in Hattiesburg, Mississippi. OnSeptember 9, 2004, February 11, 2005, and March 2, 2005, three lawsuits were filed against Tronox LLC in connection with a former wood-treatment plant located in Texarkana, Texas. In addition, on January 3, 2005, February 16, 2005, March 11, 2005, May 24, 2005, June 27,2005 and July 26, 2005, 35 lawsuits were filed against Tronox LLC and Tronox Worldwide in connection with the Avoca, Pennsylvaniafacility described above. These lawsuits seek recovery on legal theories substantially similar to those advanced in the litigation referred toabove. A total of approximately 3,300 claimants now have asserted claims in connection with the Hattiesburg plant, there are 64 plaintiffsnamed in the Texarkana lawsuits and approximately 4,600 plaintiffs are named in the new Avoca lawsuits. Tronox LLC has resolvedapproximately 1,490 of the Hattiesburg claims pursuant to a settlement reached in April 2003, which has resulted in aggregate payments byTronox LLC of approximately $0.6 million.

We believe that the follow-on Columbus and Avoca claims, the remaining Hattiesburg claims and the claims related to the Texarkanaplants are without substantial merit and are vigorously defending against them. We have not provided a reserve for these lawsuits because atthis time we cannot reasonably determine the probability of a loss, and the amount of loss, if any, cannot be reasonably estimated. We believethat the ultimate resolution of the forest products litigation will not have a material adverse effect on us.

For a discussion of other legal proceedings and contingencies, including proceedings related to our environmental liabilities, please seenote 21 to the audited combined financial statements and note 10 to the interim unaudited condensed combined financial statements includedelsewhere in this prospectus.

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MANAGEMENT

Directors and Executive Officers

Set forth below is information regarding our current executive officers and our current and prospective directors as of November 7, 2005.

Name Age PositionThomas W. Adams 44 Chief Executive Officer and DirectorMarty J. Rowland 48 Chief Operating Officer and DirectorMary Mikkelson 44 Senior Vice President and Chief Financial OfficerRoger G. Addison 54 Vice President, General Counsel and SecretaryRobert Y. Brown III 45 Vice President, Strategic Planning and DevelopmentPatrick S. Corbett 53 Vice President, Safety and Environmental AffairsRobert C. Gibney 42 Vice President, Investor Relations and External AffairsKelly A. Green 43 Vice President, Market ManagementMark S. Meadors 51 Vice President, Human ResourcesJohn D. Romano 40 Vice President, SalesGregory E. Thomas 51 Vice President, Supply Chain and Strategic SourcingRobert M. Wohleber 54 Chairman of the Board and DirectorPeter D. Kinnear 58 DirectorJ. Michael Rauh 56 DirectorBradley C. Richardson 47 Director

Thomas W. Adams is our Chief Executive Officer and Director. Mr. Adams has served as President of Tronox LLC sinceSeptember 2004, Vice President and General Manager of the Pigment Division from May to September 2004, Vice President of StrategicPlanning and Business Development of Kerr-McGee Shared Services from 2003 to 2004, Vice President of Acquisitions from March 2003 toSeptember 2003 and Vice President of Information Management and Technology from 2002 to 2003. Mr. Adams joined Sun Oil Co.,predecessor of Oryx Energy Company, in 1982. Oryx and Kerr-McGee Corporation merged in 1999.

Marty J. Rowland is our Chief Operating Officer and Director. Mr. Rowland has served as Vice President, Global Pigment Operationsfor Tronox LLC since August 2004, Director of North American Operations since May 2004, and Plant Manager for our Hamilton,Mississippi titanium dioxide plant since September 2001. Prior to joining Tronox LLC in September 2001, Mr. Rowland had a career of over20 years with E.I. DuPont, for which he most recently held a position of Maintenance and Engineering Manager.

Mary Mikkelson is our Senior Vice President and Chief Financial Officer. Ms. Mikkelson has served as Vice President and Controller ofTronox LLC since December 2004 and Assistant Corporate Controller of Kerr-McGee Shared Services from February 2004 toDecember 2004. Prior to joining Kerr-McGee, Ms. Mikkelson was an independent consultant from January 2003 to January 2004 and rose tothe level of Vice President and Controller of Foodbrands America, Inc., where she worked from April 1996 until December 2002.Ms. Mikkelson also spent over nine years working for an international public accounting firm.

Roger G. Addison is our Vice President, General Counsel and Secretary. Mr. Addison has served as Vice President, Chemical LegalServices and Assistant General Counsel of Kerr-McGee Shared Services since April 2002. Prior to that, he was Assistant General Counsel-Business Transactions for Kerr-McGee from September 1999 to April 2002.

Robert Y. Brown III is our Vice President, Strategic Planning and Development. Mr. Brown had served as Vice President, ChemicalBusiness Management since August 2004, Vice President, Kerr-McGee Planning & Development from November 2003 and Vice President,Chemical Business

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Management since June 2001. Mr. Brown also served in various positions with Kerr-McGee's oil and gas business since joining Kerr-McGeein February 1999.

Patrick S. Corbett is our Vice President, Safety and Environmental Affairs. Mr. Corbett has served as Director, Special EnvironmentalStrategy and Technology since May 2003, Director, Environmental Affairs, Remediation and Planning since December 2001 and PlantManager of our Henderson, Nevada facility since 1986. Mr. Corbett joined Kerr-McGee in May 1980.

Robert C. Gibney is our Vice President, Investor Relations and External Affairs. Mr. Gibney has served as Vice President and GeneralManager, Paper and Specialties since January 2005, Chief Marketing Officer for Kerr-McGee's joint venture, Avestor LLC, sinceJanuary 2002, Vice President, Global Pigment Marketing since May 1999, and Director, Pigment Sales and Marketing since June 1997.Mr. Gibney joined Kerr-McGee in 1991.

Kelly A. Green is our Vice President, Market Management. Ms. Green has served as Vice President and General Manager, Plastics sinceJanuary 2005, Vice President, Product and Market Management since October 2004, Vice President, Product Management sinceNovember 2003, Vice President, Technical Sales and Service since January 2002 and Director, Pigment Technical Sales and Service for theAmerica's region since June 1997. Ms. Green joined Kerr-McGee in October 1989.

Mark S. Meadors is our Vice President, Human Resources. Mr. Meadors has served as Director, Human Resources since May 2001when he joined Kerr-McGee. Prior to joining Kerr-McGee, Mr. Meadors served as a human resources consultant from February 2000 toMay 2001.

John D. Romano is our Vice President, Sales. Mr. Romano has served as Vice President, Global Pigment Sales since January 2005, VicePresident, Global Pigment Marketing from January 2002 and Regional Marketing Manager from October 1998. Mr. Romano joined Kerr-McGee in 1988.

Gregory E. Thomas is our Vice President, Supply Chain and Strategic Sourcing. Mr. Thomas has served as Vice President and GeneralManager, Coatings since January 2005 and Vice President, Global Pigment Sales and Marketing since May 1999. Mr. Thomas joined Kerr-McGee in 1977.

Robert M. Wohleber is Chairman of the Board and a Director. Mr. Wohleber has served as Senior Vice President and Chief FinancialOfficer of Kerr-McGee since December 1999. Prior to joining Kerr-McGee in 1999, Mr. Wohleber served as Executive Vice President andChief Financial Officer of Freeport-McMoRan Exploration Company, President and Chief Executive Officer of Freeport-McMoRan Sulfurand Senior Vice President of Freeport-McMoRan Gold and Copper Corporation, each of which is a natural resources company.

Peter D. Kinnear is a Director. Mr. Kinnear has served as Executive Vice President of FMC Technologies, Inc., a provider of services tothe energy, food processing and air transportation industries, since March 2004. Before serving as Executive Vice President, he served as VicePresident of FMC Technologies, Inc. from February 2001 to March 2004 and as Vice President of FMC Corporation from February 2000 toFebruary 2001.

J. Michael Rauh is a Director. Mr. Rauh has served as a Vice President of Kerr-McGee since 1987. In addition, Mr. Rauh served asController of Kerr-McGee from 1987 to 1996 and from January 2002 to present. Mr. Rauh also served as its Treasurer from 1996 to 2002.

Bradley C. Richardson is a Director. Mr. Richardson has served as the Vice President, Finance and Chief Financial Officer of ModineManufacturing Company since May 2003. Prior to joining Modine, Mr. Richardson spent over 20 years in various positions at BP Amoco,now known as BP. His last position at BP Amoco, which he held from 2000 through his departure, was Chief Financial Officer and VicePresident of Performance Management and Control for BP's Worldwide Exploration and Production division.

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Board of Directors

Our board of directors is composed of six members, divided into three classes serving staggered, three-year terms. At each annualmeeting of our stockholders, directors will be elected to succeed the class of directors whose terms have expired. The terms of our class Idirectors, Messrs. Rauh and Rowland, will expire at the 2006 annual meeting of our stockholders; the terms of our class II directors,Messrs. Adams and Kinnear, will expire at the 2007 annual meeting of our stockholders; and the terms of our class III directors,Messrs. Richardson and Wohleber, will expire at the 2008 annual meeting of our stockholders.

A company of which more than 50% of the voting power is held by a single entity is considered a "controlled company" under the NewYork Stock Exchange listing standards. A controlled company need not comply with the New York Stock Exchange corporate governancerules requiring its board of directors to have a majority of independent directors and independent compensation and nominating and corporategovernance committees. We intend to avail ourselves of the controlled company exception. In the event that we are no longer a controlledcompany, we will be required to have a majority of independent directors on our board of directors and to have our compensation andnominating and corporate governance committees be composed entirely of independent directors, subject to a phase-in period during the firstyear we cease to be a controlled company.

Committees

Our board of directors has an audit committee, an executive compensation committee, and a corporate governance and nominatingcommittee. The functions of each committee are described below.

Audit Committee. Effective immediately prior to the completion of this offering, our audit committee will consist of Messrs. Kinnear,Rauh, Richardson and Wohleber and will be responsible for acting on behalf of our board of directors for the engagement of our independentauditors and the authorization of all audit and other services provided to us by our internal and independent auditors. In addition, the auditcommittee will assist the board of directors with the oversight of our financial statements, financial reporting process, systems of internalaccounting and financial controls, disclosure controls and procedures, and compliance with legal and regulatory requirements. The auditcommittee also will evaluate enterprise risk issues and the performance of internal and independent auditors, among other things. Our board ofdirectors has adopted a written charter for the audit committee which we will make available on our website.

We believe that each of the members of our audit committee is financially literate and able to read and understand financial statements.Messrs. Kinnear and Richardson qualify as "independent," as such term is defined in Rule 10A-3(b)(1) under the Exchange Act and inSection 303A of the New York Stock Exchange listing standards. We plan to nominate additional independent members so that, within90 days after effectiveness of the registration statement of which this prospectus is a part, our audit committee has a majority of independentmembers and, within one year after such effectiveness, has only independent members.

Executive Compensation Committee. Our executive compensation committee consists of Messrs. Kinnear, Rauh, Richardson andWohleber. For as long as we are a controlled company, we will be exempt from the New York Stock Exchange requirement to have anindependent compensation committee and to adopt a written charter for the committee.

Our executive compensation committee evaluates and determines the salary and benefits of our chief executive officer and reviews thesalaries and benefits determined by the chief executive officer for all of our other officers, recommending to the board of directors suchchanges as it may deem appropriate. A sub-committee of the executive compensation committee comprised of Messrs. Kinnear

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and Richardson determines the incentive compensation awards for all officers and administers our benefit plans.

Corporate Governance and Nominating Committee. Our corporate governance and nominating committee consists of Messrs. Kinnear,Rauh, Richardson and Wohleber. For as long as we are a controlled company, we will be exempt from the requirement to have an independentcorporate governance and nominating committee and to adopt a written charter for the committee.

Our corporate governance and nominating committee recommends to our board of directors nominees for election to the board ofdirectors based on board-approved criteria for nomination as a director. In making its recommendations to our board of directors, the corporategovernance and nominating committee considers and reviews the background and qualifications of candidates recommended to it by currentdirectors as well as candidates recommended by our stockholders. The corporate governance and nominating committee also makesrecommendations to our board of directors regarding corporate governance and oversees the evaluation of our board of directors and ourmanagement.

Code of Ethics

Our board of directors has adopted a code of ethics for our senior finance officers and our chief executive officer, as well as a code ofbusiness conduct and ethics for all directors, officers and employees, each of which will become effective upon completion of this offering.We will make both codes available on our website. We will also post any amendments to the codes of ethics, and any waivers required to bedisclosed by the rules of either the SEC or the New York Stock Exchange, on our website.

Corporate Governance Guidelines

Our board of directors also has adopted corporate governance guidelines that will become effective upon completion of this offering. Theguidelines describe our governance practices and will be available on our website. These guidelines will be reviewed periodically by ourcorporate governance and nominating committee.

Director Compensation

We intend to pay a $50,000 annual retainer to our non-employee directors for fulfilling their duties as directors, together with a fee of$1,500 for each board and committee meeting attended and reimbursement for travel, lodging and other expenses related to their service asdirectors. In addition, we expect to pay an additional annual retainer of $7,500 to the chairman of each committee. We also expect to granteach non-employee director restricted stock awards under the equity plan valued at approximately $50,000 per year. Our employee directors(including employees of Kerr-McGee) are not separately compensated for their services as directors.

Executive Compensation

The following table shows the compensation awarded or paid by Kerr-McGee to, or earned by, the following individuals during the fiscalyear ended December 31, 2004:

�� our chief executive officer;

�� our four other most highly compensated executive officers; and

�� Mary Mikkelson, our senior vice president and chief financial officer, who joined Kerr-McGee in February of 2004.

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We refer to these individuals as our "named executive officers."

Summary Compensation Table

Long-Term

Compensation AwardsAnnual Compensation

Name and Principal Position Year Salary BonusOther Annual

Compensation(2)

Restricted

Stock

Awards(3)(4)

No. of

Securities

Underlying

Options

All Other

Compensation(5)

Thomas W. Adams,

Chief Executive Officer2004 $ 285,600 $ 169,513 $ 5,834 $ 81,625 5,155 $ 17,946

Marty J. Rowland,

Chief Operating Officer2004 189,137 74,127 54,835 21,799 1,357 11,348

Mary Mikkelson,(1)

Senior Vice President and Chief

Financial Officer

2004 131,592 85,648 � � � 7,507

Roger G. Addison,

Vice President, General Counsel and

Secretary

2004 200,835 134,858 34,793 66,829 4,250 12,000

Robert Y. Brown III

Vice President, Strategic Planning

and Development

2004 213,180 129,577 32,748 46,114 3,045 12,502

Gregory E. Thomas

Vice President, Supply Chain and

Strategic Sourcing

2004 243,778 105,945 14,994 59,184 3,650 14,108

(1)Ms. Mikkelson was hired by Kerr-McGee in February of 2004.

(2)Perquisite or other personal benefits received from Kerr-McGee that exceed reporting thresholds established by Securities and Exchange Commission regulations.

Amounts for Mr. Adams reflect dividends paid on restricted stock. Amounts for Mr. Rowland include dividends paid on restricted stock, personal use of an automobile and

payments in the amount of $48,700 for moving expenses and the associated tax gross-up payment. Amounts for Mr. Addison include dividends paid on restricted stock,

stock option exercise gains in the amount of $19,050 and restricted stock lapsing in the amount of $9,864. Amounts for Mr. Brown include dividends paid on restricted

stock and stock option exercise gains in the amount of $29,596. Amounts for Mr. Thomas include dividends paid on restricted stock in the amount of $5,130 and restricted

stock lapsing in the amount of $9,864.

(3)Restricted Kerr-McGee stock grants are valued based on the closing price of Kerr-McGee common stock on the New York Stock Exchange on the grant date.

(4)As of December 31, 2004, the aggregate number of shares of restricted stock held by each of our named executive officers and the market value of that stock, based on the

closing price of the Kerr-McGee's common stock on the New York Stock Exchange on December 31, 2004, was: Mr. Adams-3,655 shares, $211,222; Mr.

Rowland-1,042 shares, $60,217; Mr. Addison-3,555 shares, $205,443; Mr. Brown-1,985 shares, $114,713; and Mr. Thomas-2,900 shares, $167,591. Dividends are paid to

the holders of restricted stock.



(5)Consists of 401(k) plan contributions by Kerr-McGee pursuant to the Savings Investment Plan, amounts contributed under the Kerr-McGee nonqualified benefits

restoration plan and life insurance premiums. Kerr-McGee's contributions pursuant to the Savings Investment Plan for 2004 were $12,846 for Mr. Adams, $11,348 for Mr.

Rowland, $7,411 for Ms. Mikkelson, $12,000 for Mr. Addison, $12,000 for Mr. Brown, and $11,344 for Mr. Thomas. The amounts contributed by Kerr-McGee to the

non-qualified benefits restoration plan for 2004 on behalf of Mr. Adams was $4,836, on behalf of Mr. Brown was $491 and on behalf of Mr. Thomas was $2,764, which

are identical to the amounts that would have been contributed pursuant to the Savings Investment Plan except for Internal Revenue Code limitations.

97



Grant of Kerr-McGee Stock Options

The following table contains information concerning grants of options to acquire shares of Kerr-McGee common stock during the fiscalyear ended December 31, 2004, to the named executive officers.

Name

No. of Securities

Underlying

Options Granted(1)

Percent of Total

Options Granted

to Kerr-McGee

Employees in

Fiscal Year 2004

Per Share

Exercise PriceExpiration Date

Grant Date

Present

Value(3)

Thomas W. Adams 5,155 (2) $ 49.45 January 13, 2014 $ 44,281

Marty J. Rowland 1,357 (2) 49.45 January 13, 2014 11,657

Mary Mikkelson � � � � �

Roger G. Addison 4,250 (2) 49.45 January 13, 2014 36,508

Robert Y. Brown III 3,045 (2) 49.45 January 13, 2014 26,157

Gregory E. Thomas 3,650 (2) 49.45 January 13, 2014 31,354(1)

All stock options granted in 2004 were nonqualified stock options. The exercise price per option is 100% of the fair-market value of a share of Kerr-McGee common stock

on the grant date. No option expires more than ten years and one day from the grant date.

(2)Less than 1%.

(3)The present value of stock option grants was computed in accordance with the Black-Scholes option pricing model, with assumptions consistent with Statement of

Financial Accounting Standards No. 123, "Accounting for Stock-Based Compensation," as permitted by the rules of the Securities and Exchange Commission. Key

assumptions used under the Black-Scholes model include: (a) an expected option term of 5.8 years, (b) interest rate of 3.5%, which represents the U.S. Treasury Strip Rate

on January 13, 2004, with maturity corresponding to the expected option term, (c) stock price volatility of 22.6%, and (d) dividends at an average annual dividend yield of

3.6%. Based on the Black-Scholes model, the value on January 13, 2004, was $8.59 per option. Our use of the Black-Scholes model should not be construed as an

endorsement of its accuracy at valuing options. All stock option valuation models, including the Black-Scholes model, require a prediction about the future movement of

the stock price. The real value of the options in this table depends upon the actual changes in the market price of Kerr-McGee's common stock during the applicable

period.

Pursuant to the employee benefits agreement between us and Kerr-McGee, if the Distribution occurs, Kerr-McGee stock-based awardsheld by our employees, including our named executive officers, that are outstanding on the effective date of the Distribution will be convertedto or replaced by stock-based awards under our long term incentive plan. Employees, including our named executive officers, who hold Kerr-McGee vested stock options generally may exercise such options for the lesser of three months after the effective date of the Distribution andthe remaining term of the option award. However, we anticipate that employees eligible for retirement on the effective date of the Distributionmay be able to exercise their Kerr-McGee vested stock options for the lesser of four years after the effective date of the Distribution and theremaining term of the option award. See "�Treatment of Kerr-McGee Stock Options, Restricted Stock and Performance Unit Awards,""Arrangements between Kerr-McGee and Our Company�Employee Benefits Agreement�Kerr-McGee Stock Options and Restricted Stock" and"Arrangements between Kerr-McGee and Our Company�Employee Benefits Agreement�Incentive Plans."

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Aggregated Exercise of Kerr-McGee Stock Options and Year-End Option Values

The following table contains information with respect to options to acquire Kerr-McGee common stock that were exercised during 2004and the value of unexercised options held as of December 31, 2004 for the named executive officers.

Number of

Securities Underlying

Unexercised Options

at December 31, 2004

Value of Unexercised

In-the-Money Options

at December 31, 2004(1)Name

Shares

Acquired on

Exercise

Value

RealizedExercisable Unexercisable Exercisable Unexercisable

Thomas W. Adams � � 12,980 11,582 $ 40,697 $ 102,754

Marty J. Rowland � � 2,400 3,457 12,793 31,436

Mary Mikkelson � � � � � �

Roger G. Addison 2,700 19,050 14,082 11,318 36,091 97,350

Robert Y. Brown III 4,000 29,596 6,087 6,945 � 59,683

Gregory E. Thomas � � 21,066 10,284 46,265 84,873(1)

Options are "in the money" if the fair market value of the common stock exceeds the exercise price. On December 31, 2004, the fair market value of Kerr-McGee's

common stock on the New York Stock Exchange was $57.95.

Kerr-McGee Long-Term Incentive Awards

The following table contains information regarding each long-term incentive award, other than stock option and restricted stock awards,made during the fiscal year ended December 31, 2004, to the named executive officers.

Estimated Future Payouts Under

Non-Stock Price-Based Plans

Name

No. of Shares,

Units or

Other Rights

Performance or

Other Period

Until Maturation

or Payout

Threshold Target Maximum

Thomas W. Adams 85,430January 2004 -

December 2006$ 42,715 $ 85,430 $ 170,860

Marty J. Rowland 14,750January 2004 -

December 20067,375 14,750 29,500

Mary Mikkelson � � � � �

Roger G. Addison 68,490January 2004 -

December 200634,245 68,490 136,980

Robert Y. Brown III 45,955January 2004 -

December 200622,978 45,955 91,910

Gregory E. Thomas 60,650January 2004 -

December 200630,325 60,650 121,300

For any performance cycles that include the 2005 calendar year, Kerr-McGee will pay, in accordance with its terms, all, or any portionof, a performance unit award that is vested on the effective date of the Distribution. All, or any portion of, a performance unit award that is notvested on the effective date of the Distribution will be canceled and replaced with an award under our long term incentive plan that is equal invalue to the forfeited portion of the award (see "Arrangements between Kerr-McGee and Our Company�Employee BenefitsAgreement�Incentive Plans").



Treatment of Kerr-McGee Stock Options, Restricted Stock and Performance Unit Awards

Pursuant to the employee benefits agreement, our employees generally will have the right to exercise their vested Kerr-McGee stockoptions in accordance with the terms of the Kerr-McGee stock option plan under which they were granted and the terms of their respectivegrants for the lesser of three months after the effective date of the Distribution and the remaining term of the respective option awards.However, we anticipate that employees eligible for retirement on the effective date of the Distribution may be able to exercise their vestedstock options for the lesser of four years after the effective date of the Distribution or the remaining term of the option award.

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Kerr-McGee unvested stock options held by our employees on the effective date of the Distribution will be converted into options topurchase our Class A common stock. Restricted shares of Kerr-McGee common stock held by our employees on that date will be convertedinto restricted shares of our Class A common stock. Unvested Kerr-McGee performance unit awards held by our employees on the effectivedate of the Distribution will be canceled and replaced with options or restricted shares of our Class A common stock.

To accomplish the conversion of unvested Kerr-McGee stock options, we will multiply the number of shares purchasable under eachsuch stock option by a conversion ratio and divide the exercise price per share of each option by the same ratio. The conversion ratio will bethe price of Kerr-McGee's common stock on the date of the Distribution divided by the price of our Class A common stock on the date of theDistribution. The number of restricted shares of our Class A common stock that will be subject to each converted Kerr-McGee restricted stockaward will be determined by multiplying the number of shares of Kerr-McGee common stock subject to the original award by the sameconversion ratio.

With respect to each forfeited Kerr-McGee performance unit award that will be replaced by restricted shares, we will divide the value ofthe forfeited award by the price of our Class A common stock on the effective date of the Distribution to determine the number of restrictedshares of our Class A common stock to issue in replacement of the forfeited award. With respect to each forfeited Kerr-McGee performanceunit award that will be replaced by stock options, we will take the value of the forfeited award and convert it into a number of sharespurchasable under each such option using the Black-Scholes methodology.

Stock-based awards issued on conversion or in replacement of Kerr-McGee options and restricted stock will otherwise have the sameterms and conditions, including, in the case of converted stock options, the same vesting provisions and exercise periods, as the Kerr-McGeestock-based awards had immediately prior to their conversion or replacement.

The actual number of shares of our Class A common stock that will be issued in connection with the conversion or replacement of Kerr-McGee stock-based awards on the effective date of the Distribution will depend on the per share price of our Class A common stock and Kerr-McGee's common stock, as well as on the number of Kerr-McGee stock-based awards held by our employees, on that date. Based on the166,907 unvested Kerr-McGee options, the 84,338 restricted shares of Kerr-McGee stock and the $3,119,184 in value of performance unitawards held by our employees on September 30, 2005, the following number of shares of our Class A common stock would be issued inconnection with the conversion or replacement of awards, assuming the prices for our Class A common stock and Kerr-McGee's commonstock shown below:

Hypothetical Kerr-McGee Common Stock Price on Distribution

Date

Hypothetical Tronox Class A Common Stock Price on Day after Distribution

Date

$19.00 $20.00 $21.00 $22.00

(number of shares)$70.00 1,089,007 1,035,317 986,016 941,197$80.00 1,222,041 1,160,939 1,105,656 1,055,399$90.00 1,354,275 1,286,562 1,225,297 1,169,602$100.00 1,486,510 1,412,184 1,344,937 1,283,804

For purposes of this table, we have assumed that Kerr-McGee performance unit awards are replaced with restricted shares of our Class Acommon stock. The per share prices of Kerr-McGee common stock and of our Class A common stock set forth in this table do not necessarilyreflect the range of expected prices on the effective date of the Distribution. The number of shares of our Class A common stock issued inconnection with the conversion or replacement of Kerr-McGee stock-based awards could vary significantly from the above numbers due tochanges in the relative values of our

100



Class A common stock and Kerr-McGee's common stock. In addition, the number of unvested Kerr-McGee options and restricted shares ofKerr-McGee common stock, and the value of Kerr-McGee performance unit awards, subject to conversion and replacement may varysignificantly due to a number of factors, including the effective date of the Distribution (because options will continue to vest, restrictions onshares of restricted stock will continue to lapse and the number of outstanding Kerr-McGee performance unit awards will continue to decreasebetween the date of this offering and the effective date of the Distribution) and the forfeiture of Kerr-McGee stock-based awards by ouremployees who terminate their employment with us prior to the Distribution.

Pension and Retirement Plans

Prior to the Distribution, Kerr-McGee will maintain retirement plans for all our employees, including our named executive officers. See"Arrangements between Kerr-McGee and Our Company�Employee Benefits Agreement." The following table illustrates the pension benefitsthat may accrue to our named executive officers under those retirement plans, assuming various service periods. The table shows the estimatedannual pension benefits payable to a covered participant at a retirement age of 65. Pension benefits include benefits payable under ourqualified defined benefit plan and our nonqualified benefits restoration plan, or the BRP. The BRP provides benefits that would be providedunder the qualified defined benefit plan but for limitations imposed by the Internal Revenue Code on qualified plan benefits.

Pension Plan Table

Average AnnualCompensation

15 YearsService

20 YearsService

25 YearsService

30 YearsService

35 YearsService

$ 400,000 $ 96,715 $ 128,954 $ 161,192 $ 193,430 $ 208,430600,000 146,715 195,620 244,526 293,431 315,931

Covered compensation under the retirement plans consists of salary, bonus and pretax Section 125 and 401(k) benefit contributions, allbased on the highest 36 consecutive months out of the last 120 months prior to retirement. Amounts shown are computed on a straight lifeannuity basis. As of December 31, 2004, Mr. Adams had 22 years of credited service, Mr. Rowland had three years of credited service,Ms. Mikkelson had no years of credited service, Mr. Addison had 27 years of credited service, Mr. Brown had 23 years of credited service andMr. Thomas had 27 years of credited service.

If the Distribution occurs, we intend to establish a tax-qualified defined benefit retirement plan and related trust for our employees,including our named executive officers, who participated in Kerr-McGee's defined benefit retirement plan. In connection with our assumptionof obligations, Kerr-McGee will transfer assets from the trust for Kerr-McGee's defined benefit retirement plans to the trust we will establish.We also plan to establish a defined benefit non-qualified deferred compensation plan that will assume the liabilities of the defined benefitportion of the BRP. See "Arrangements between Kerr-McGee and Our Company�Employee Benefits Agreement."

Long Term Incentive Plan

We have adopted our own long term incentive plan so that our employees receive stock option or other equity-based awards that relate tothe value of our Class A common stock and not Kerr-McGee's stock. This summary of the material terms of the long term incentive planbelow is not complete. You should read the full text of the long term incentive plan, which has been filed as an exhibit to the registrationstatement of which this prospectus is a part.

The long term incentive plan will include provisions which provide for the grant of (a) stock options, (b) stock appreciation rights(SARs), (c) restricted stock and (d) performance awards. The

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long term incentive plan permits total equity awards over the life of the long term incentive plan of up to 6.1 million shares of our Class Acommon stock, subject to the following limits:

(a)Aggregate limits on shares designated for restricted stock andperformance awards to officers and employees

1.5 million shares

(b)Aggregate limits on shares designated for stock options and restrictedstock to non-employee directors, of which no more than 125,000 sharesmay be restricted stock

0.25 million shares

(c) Aggregate limit on shares designated for incentive stock options 1.5 million shares

Term and Administration

The long term incentive plan will be effective as of the date of completion of this offering for a term of ten years, unless terminatedearlier by our board of directors. The long term incentive plan will be administered by our board of directors or by a committee designated bythe board of directors. The board of directors has designated a subcommittee of our executive compensation committee comprised ofMessrs. Kinnear and Richardson to administer the long term incentive plan.

Eligibility

Eligibility under the long term incentive plan will be limited to our officers and employees and our non-employee directors. The planadministrator, in its sole discretion, will determine which officers and employees are eligible to participate in the long term incentive plan. Wecurrently estimate that approximately 200 employees and all officers and non-employee directors will participate in the long term incentiveplan.

Limits on Awards to An Officer or Employee

No officer or employee will be awarded, during the term of the long term incentive plan, restricted stock covering more than 0.5 millionshares of our Class A common stock, or stock options covering more than 2.0 million shares of our Class A common stock. In addition, noofficer or employee will be granted performance awards under the long term incentive plan during a calendar year that could result in apayment of more than $5.0 million in cash or shares of our Class A common stock, based on the fair market value of the shares as of the firstday of the performance period.

Securities Eligible under the Long Term Incentive Plan

Stock Options. The long term incentive plan authorizes awards of stock options to non-employee directors and eligible officers andemployees from time to time as determined by the plan administrator. Subject to the limits of the long term incentive plan, the planadministrator may grant options for such number of shares of our Class A common stock and having such terms as the plan administratordesignates.

Under the terms of the long term incentive plan, the plan administrator will specify whether or not any option is intended to be anincentive stock option, as described in Internal Revenue Code Section 422, or a nonstatutory or nonqualified stock option. Each stock optionwill have an exercise price that is not less than the fair market value of the Class A common stock on the date the option is granted. To theextent permitted by applicable law, payment for shares of our Class A common stock received upon exercise of a stock option may be madeby an optionee in cash, shares of common stock, a combination of the foregoing, through a cashless exercise with a broker, or, in thediscretion of the plan administrator, by our withholding shares of Class A common stock equal in value to the exercise price of the stockoption.

A stock option will terminate and may no longer be exercised three months after an officer or employee ceases to be employed for anyreason other than cause, total disability, death or retirement.



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In the event an officer or employee is terminated for cause, unless an option agreement provides otherwise, all outstanding options at the timeof such officer's or employee's termination of employment will terminate. In the event an officer or employee ceases employment due to totaldisability, death or retirement, all outstanding options at the time of such officer's or employee's termination of employment will vest and willbe exercisable during the remaining term of the option, not to exceed four years. When a non-employee director's service terminates,outstanding options will vest immediately and remain exercisable for the remaining term of the option.

Stock Appreciation Rights. The long term incentive plan also authorizes the plan administrator to award SARs either in tandem with astock option or independent of any option. Subject to the limits of the long term incentive plan, the plan administrator may grant SARs forsuch number of shares of our Class A common stock and having such terms as the plan administrator designates. A SAR provides the granteewith the right to exercise all or a portion of the SAR and receive a payment in cash equal to the excess of the fair market value of the exercisedshares on the date of exercise over the aggregate exercise price of such shares. SARs shall be exercisable at such times and be subject to suchrestrictions and conditions as the plan administrator shall approve.

Restricted Stock. Subject to the limits of the long term incentive plan, the plan administrator may grant restricted stock for such numberof shares of our Class A common stock and having such terms as the plan administrator designates. The plan administrator will determine thenature and extent of the restrictions on grants of restricted stock, the duration of such restrictions, and any circumstances under whichrestricted shares will be forfeited. Restricted shares of our Class A common stock will be deposited with us during the period of any restrictionthereon and, except as otherwise provided by the plan administrator during any such period of restriction, recipients shall have all of the rightsof a holder of our Class A common stock, including but not limited to voting rights and the right to receive dividends.

If a grantee terminates service by reason of total disability, death or retirement prior to the expiration of the restriction period for a grantof restricted stock, the restriction period will lapse and the shares will be delivered to the recipient. Unless the plan administrator providesotherwise, a termination of service for other reasons prior to the expiration of the applicable restriction period will result in the forfeiture ofthe restricted stock.

Performance Awards. The long term incentive plan permits the plan administrator to grant performance awards to eligible officers andemployees from time to time. Performance awards may include performance units valued by reference to financial measures or property otherthan our Class A common stock and performance shares valued by reference to shares of our Class A common stock.

Under the terms of the long term incentive plan, the plan administrator will establish the time period of not less than one year over whichperformance will be measured (which we refer to as the performance period) and the performance goals used by the plan administrator toevaluate performance during a performance period. Payment of earned performance awards may be made to participants in cash, our Class Acommon stock, restricted shares of our Class A common stock, other property or a combination of the foregoing as determined by the planadministrator.

In the event an officer or employee terminates employment due to death, total disability or retirement after completing at least one monthof the performance period for an award, such officer or employee will be entitled to a pro rata portion of the award if the applicableperformance goals are met. Unless the plan administrator provides otherwise, if an officer or employee terminates employment for any otherreason prior to the end of a performance period for an award, he or she will not be entitled to any payment under the award.

Performance Criteria. Payments under, or vesting of, awards under the long term incentive plan may be subject to the attainment ofperformance goals established by the plan administrator.

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Performance goals may be based on our financial or operating measures, such as pretax income, net income, earnings per share, sales volume,revenue, expenses, return on assets, return on equity, return on investment, net profit margin, operating profit margin, cash flow, totalstockholder return, capitalization, liquidity, production volume, results of customer satisfaction surveys and other measures of quality, safety,productivity, cost management or process improvement. The criteria may be based on our performance compared with one or more selectedcompanies.

Change in Control

In the event of a change in control, as defined in the long term incentive plan, any outstanding options or SARs that have not yet vestedwill vest effective as of such date, restrictions on restricted stock will lapse, and participants who have previously been granted performanceawards will earn the amounts the participants would have earned if target performance under the awards had been obtained.

Initial Grants

In connection with this offering, executive officers, non-employee directors (other than Kerr-McGee directors) and certain employeeswill be awarded initial stock option grants to purchase shares of our Class A common stock and restricted shares of our Class A common stockpursuant to our long term incentive plan. The option grants will vest over three years, with equal amounts vesting on each anniversary of thegrant date. The exercise price per share of the stock options will be equal to the fair market value of our Class A common stock on the date ofthis offering. The options will have a ten-year exercise period. Approximately 0.4 million shares will be issuable upon the exercise of theoptions. Approximately 0.4 million restricted shares of our Class A common stock will be awarded. The restrictions on such shares will lapseon the third anniversary of the grant date.

Employment and Other Agreements

Continuity Agreements

We intend to enter into continuity agreements with our named executive officers and certain key employees. The continuity agreementswill provide benefits in the event of a qualifying termination that occurs in connection with a "change in control" of Tronox.

In the case of a named executive officer, in the event of a qualifying termination of employment within two years after a change incontrol, such executive will be entitled to receive:

�� a lump sum cash payment equal to three times the executive's annual base salary, bonuses and perquisites (with suchperquisites calculated at 7% of the executive's annual base salary);

�� any accrued but unpaid compensation (including the pro-rata amount of any bonus);

�� any previously deferred compensation;

�� an amount equal to the value of the number of performance units that the executive would have earned if the performanceperiod for such performance units had ended on the date of the change in control or, if greater, the target number ofperformance units under the award; and



�� an amount representing additional savings plan contributions for a three-year period plus the present value of lost pensionbenefits under our qualified defined benefit retirement plans after giving effect to five years of credit for age and service in thebenefit calculation.

If the payment made to the executive causes such executive to be subject to an excise tax because the payment is a "parachute payment"(as defined in the Internal Revenue Code), then the payment

104



will be increased to compensate the executive for the excise tax. In addition, in the event of a qualifying termination, the executive will beentitled to:

�� a continuation of welfare benefits for up to three years;

�� outplacement services;

�� acceleration of vesting of all equity and equity-based awards; and

�� all other accrued or vested benefits under our employee benefit plans.

In the case of a key employee, in the event of a qualifying termination of employment within two years after a change in control, suchkey employee will be entitled to receive the compensation and benefits described above with the following exceptions:

�� the lump sum cash payment will be equal to two times the sum of the annual base salary, bonuses, and perquisites;

�� the amount representing additional savings plan contributions will be for a two-year period;

�� welfare benefits may be continued for up to two years; and

�� if a payment would cause the key employee to be subject to an excise tax because the payment is a "parachute payment," thenthe payment may be reduced to a level that would not be subject to the excise tax.

Subject to exceptions for this offering, the Distribution and any event that would trigger benefits under any Kerr-McGee continuityagreement, the continuity agreements define a change in control as (a) a change in any two-year period in a majority of the members of ourboard of directors (with exceptions and as defined in the continuity agreements), (b) any person becoming the beneficial owner, directly orindirectly, of 25% or more of our outstanding common stock, (c) with certain exceptions, the consummation of a merger or consolidation ofTronox with any other corporation, a sale of 50% or more of our assets, our liquidation or dissolution or combination of the foregoingtransactions other than such a transaction immediately following which our stockholders and any trustee or fiduciary of any of our employeebenefit plan immediately prior to the transaction own at least 60% of the voting power of the surviving corporation(s), or (d) if a majority ofthe board members in office immediately prior to a proposed transaction determine by written resolution that such proposed transaction, iftaken, will be deemed a change in control and such proposed transaction is effected.

Kerr-McGee 2005 Success Bonus and Retention Programs

On April 1, 2005, Kerr-McGee adopted the Kerr-McGee 2005 Success Bonus Program and the Kerr-McGee 2005 Retention Program.All of our executive officers participate in one (but not both) of the programs. Under the programs, Kerr-McGee will pay a special bonusequal to 100% of each executive officer's annual base salary if such executive officer is employed by us or a Kerr-McGee affiliate through (orinvoluntarily terminated before) March 31, 2006 (in the case of the Retention Program) or the completion of this offering (in the case of theSuccess Bonus Program). In addition, under the Success Bonus Program, participating executive officers may receive, at Kerr-McGee'sdiscretion, based on factors such as the success of the Transactions and such executive officer's individual contribution, an additional bonus ofup to 100% of such executive officer's annual base salary.



Pursuant to the employee benefits agreement, Kerr-McGee will retain its obligation to pay bonuses to our executive officers under theSuccess Bonus Program following the completion of this offering. We will be responsible for paying bonuses under the Retention Program,although Kerr-McGee will reimburse us for a prorated portion of any bonuses awarded under the Retention Program based on such executiveofficer's employment by Kerr-McGee prior to the completion of the Transactions.

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PRINCIPAL STOCKHOLDER

We are currently a wholly-owned subsidiary of Kerr-McGee. After completion of this offering, Kerr-McGee will own 100% of theoutstanding shares of our Class B common stock, which will represent:

�� 56.7% of all classes of our outstanding common stock, or 50.2% if the underwriters fully exercise their option to purchaseadditional shares; and

�� 88.7% of the combined voting power of all classes of our outstanding common stock with respect to the election and removalof directors only, or 85.8% if the underwriters fully exercise their option to purchase additional shares.

Under applicable provisions of the Delaware General Corporation Law and our amended and restated certificate of incorporation, prior tothe Distribution, Kerr-McGee will be able, acting alone, to elect our entire board of directors and to approve any action requiring stockholderapproval. Except for Kerr-McGee, we are not aware of any person or group that will beneficially own more than 5% of the outstanding sharesof either our Class A common stock or our Class B common stock following this offering. The address of Kerr-McGee's principal executiveoffice is Kerr-McGee Center, 123 Robert S. Kerr Avenue, Oklahoma City, Oklahoma 73125.

Kerr-McGee Stock Ownership

Although none of our executive officers or directors currently owns any of our common stock, some do own shares of Kerr-McGee'scommon stock. To the extent our executive officers and directors own shares of Kerr-McGee common stock at the time of the Distribution,they will share in the Distribution on the same terms as Kerr-McGee's other stockholders. The following table sets forth the number of sharesof Kerr-McGee common stock and options to purchase Kerr-McGee common stock beneficially owned at September 30, 2005 by eachdirector and named executive officer listed under "Management�Executive Compensation" and our directors and executive officers as a group.Except as otherwise noted, the individual director or named executive officer had sole voting and investment power with respect to suchsecurities. The total number of shares of Kerr-McGee common stock outstanding as of September 30, 2005 was 115,979,669. No individualdirector or executive officer owned, nor did the directors and executive officers as a group own, more than 1% of Kerr-McGee's commonstock.

Directors, Named Executive Officers and Directorsand Executive Officers as a Group

Kerr-McGeeCommon Stock

Beneficially Owned(1)

Thomas W. Adams 20,994(2)

Marty J. Rowland 4,612(3)

Mary Mikkelson 1,440Roger G. Addison 11,083(4)

Robert Y. Brown III 5,150Gregory E. Thomas 5,555Robert M. Wohleber 187,895(5)

Peter D. Kinnear �

J. Michael Rauh 27,843Bradley C. Richardson �

Directors and executive officers as a group (15 persons) 215,738(6)

(1)Beneficial ownership is determined in accordance with the rules of the Securities and Exchange Commission and generally includes voting or investment power with

respect to securities. Shares of common stock subject to options that are exercisable or will become exercisable within 60 days of September 30, 2005 into shares of Kerr-

McGee common stock are deemed to be outstanding and to be beneficially owned by the person holding the options for the purpose of computing the percentage

ownership of the person, but are not treated as outstanding for the purpose of computing the percentage ownership of any other person.



(2)Mr. Adams' holdings include 12,035 shares subject to options.

(3)Mr. Rowland's holdings include 1,786 shares subject to options.

(4)Mr. Addison's holdings include 5,049 shares subject to options.

(5)Mr. Wohleber's holdings include 119,549 shares subject to options.

(6)Includes 119,549 shares subject to options.

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Post-Closing Tronox Stock Option and Restricted Stock Ownership

The following table sets forth the number of shares of our Class A common stock that are expected to be beneficially owned by each ofour directors, named executive officers, and all of our directors and executive officers as a group following completion of this offering(without giving effect to vesting schedules), after giving effect to the initial grant of stock options and restricted shares of our Class Acommon stock described in "Management�Long Term Incentive Plan�Initial Grants."

Directors, Named Executive Officers and Directorsand Executive Officers as a Group

Number ofShares of Our

Class ACommon Stock

UnderlyingOptions to Be

Granted atClosing

RestrictedShares of Our

Class ACommon Stock

to Be Granted atClosing

Total

Thomas W. Adams 102,200 82,600 184,800Marty J. Rowland 29,600 23,900 53,500Mary Mikkelson 21,700 17,500 39,200Roger G. Addison 15,100 12,200 27,300Robert Y. Brown III 12,800 10,300 23,100Gregory E. Thomas 8,100 6,600 14,700Robert M. Wohleber � � �

Peter D. Kinnear � � �

J. Michael Rauh � � �

Bradley C. Richardson � � �

Directors and executive officers as a group (15 persons) 232,000 193,100 425,100

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ARRANGEMENTS BETWEEN KERR-McGEE AND OUR COMPANY

Provided below are summary descriptions of the master separation agreement between us and Kerr-McGee and the other keyagreements that relate to our separation from Kerr-McGee. These descriptions, which summarize the material terms of these agreements, arenot complete. You should read the full text of these agreements, which have been filed as exhibits to the registration statement, of which thisprospectus is a part.

Master Separation Agreement

The master separation agreement contains the key provisions related to our separation from Kerr-McGee, this offering and theDistribution.

Contribution

Kerr-McGee's chemical business currently is operated by Tronox Worldwide and its subsidiaries, including Tronox LLC and variousEuropean subsidiaries. Prior to the closing of this offering, pursuant to the terms of the master separation agreement, Kerr-McGee will transferTronox Worldwide to us. Kerr-McGee also will transfer rights and obligations under contracts that relate to or are used by the subsidiaries thatwill be transferred to us. Kerr-McGee will represent and warrant that it has good and valid title to the equity interests in Tronox Worldwide,but otherwise Kerr-McGee is not making any representations and warranties to us of any nature, including regarding the assets of, or any othermatters relating to, the chemical business.

Tronox Worldwide, its subsidiaries and their predecessors have operated a number of businesses in addition to the current chemicalbusiness, including businesses involving the treatment of forest products, the production of ammonium perchlorate, the refining and marketingof petroleum products, offshore contract drilling and the mining, milling and processing of nuclear materials. Tronox Worldwide and itssubsidiaries are, and as a result we will be, subject to significant liabilities associated with those other businesses. For example, we will haveliabilities relating to the remediation of various sites at which chemicals such as creosote, perchlorate, low-level radioactive substances,asbestos and other materials have been used or disposed. See "Risk Factors�Risks Related to Our Business and Industry�We will be subject tosignificant liabilities that are in addition to those associated with our primary business. These liabilities could adversely affect our financialcondition and results of operations and we could suffer losses as a result of these liabilities even if our primary business performs well."

Reimbursement by Kerr-McGee for Environmental Remediation Costs

Pursuant to the master separation agreement, Kerr-McGee has agreed to reimburse us for a portion of the environmental remediationcosts we incur and pay after the completion of this offering (net of any cost reimbursements we expect to recover from insurers, governmentalauthorities or other parties). The reimbursement obligation extends to costs incurred at any site associated with any of our former businessesor operations.

With respect to any site for which we have established a reserve as of the effective date of the master separation agreement, 50% of theremediation costs we incur and pay in excess of the reserve amount (subject to a minimum threshold amount) will be reimbursable by Kerr-McGee, net of any amounts recovered or, in our reasonable and good faith estimate, that will be recovered from third parties. With respect toany site for which we have not established a reserve as of the effective date of the master separation agreement, 50% of the amount of theremediation costs we incur and pay (subject to a minimum threshold amount) will be reimbursable by Kerr-McGee, net of any amountsrecovered or, in our reasonable and good faith estimate, that will be recovered from third parties.

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Kerr-McGee's aggregate reimbursement obligation to us cannot exceed $100 million and is subject to various other limitations andrestrictions. For example, Kerr-McGee is not obligated to reimburse us for amounts we pay to third parties in connection with tort claims orpersonal injury lawsuits, or for administrative fines or civil penalties that we are required to pay. Kerr-McGee's reimbursement obligation isalso limited to costs that we actually incur and pay within seven years following the completion of this offering.

This Offering

Under the master separation agreement, we and Kerr-McGee will agree to use commercially reasonable efforts to satisfy certainconditions to the completion of this offering, any of which may be waived by Kerr-McGee, in its sole discretion, including:

�� the registration statement containing this prospectus must be effective;

�� any actions and filings required by state securities and blue sky laws must have been taken;

�� our Class A common stock must have been accepted for listing on the New York Stock Exchange;

�� Kerr-McGee must be satisfied in its sole and absolute discretion that the Distribution should qualify as a pro rata or non-prorata tax-free distribution for federal income tax purposes under Sections 355 and 368(a)(1)(D) of the Internal Revenue Code;

�� Kerr-McGee must have determined that the terms of this offering, including the timing and pricing of the offering, areacceptable to it; and

�� the private offering by Tronox Worldwide and Tronox Finance Corp. of the unsecured notes and the entry into the seniorsecured credit facility by Tronox Worldwide must be consummated concurrently with this offering on terms and with lendersthat are acceptable to Kerr-McGee.

The Distribution

Kerr-McGee has advised us that, subject to the terms of its agreement with the underwriters (as discussed in "Underwriting�Lock-UpAgreements"), following completion of this offering it intends to complete the Distribution. Kerr-McGee has the sole discretion to determinethe form, structure and all other terms of any transactions to effect the Distribution. The Distribution is subject to several conditions that musteither be satisfied or waived by Kerr-McGee, in its sole discretion, including:

�� receipt of an opinion of tax counsel to the effect that, among other things, the Distribution should qualify as a tax-freedistribution for federal income tax purposes under Sections 355 and 368(a)(1)(D) of the Internal Revenue Code;

�� receipt of any necessary government approvals and material consents;



�� lack of any order, injunction, decree or regulation issued by any court or agency of competent jurisdiction or other legalrestraint or prohibition preventing the completion of the Distribution; and

�� our Class B common stock must have been accepted for listing on the New York Stock Exchange.

In addition, if Kerr-McGee's board of directors determines, in its sole discretion, that the Distribution is not in the best interests of Kerr-McGee or its stockholders, Kerr-McGee may elect not to complete the Distribution. Because the Distribution is subject to a number ofconditions, the Distribution may not occur, and if it does occur, we may not achieve the expected benefits of the

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Distribution. See "Risk Factors�Risks Related to Our Relationship with Kerr-McGee�The Distribution may not occur, and we may not achievethe expected benefits of the Distribution."

We are required by the master separation agreement to take any and all actions necessary or appropriate to effect the Distribution.

Indemnification

Under the master separation agreement, we will indemnify Kerr-McGee from all losses suffered by Kerr-McGee arising out of certaincircumstances or events, including:

�� all liabilities of us and our subsidiaries arising out of or related to the present or former businesses, operations, assets orproperties currently or previously conducted or owned by us or any of our subsidiaries (and their predecessors) before, on orafter the completion of this offering;

�� any breach by us of the master separation agreement or any of the other agreements (other than the transition services and taxsharing agreements, which contain their own indemnification provisions) entered into by us and Kerr-McGee in connectionwith our separation from Kerr-McGee; and

�� any untrue statement of a material fact or material omission in this prospectus or any similar documents relating to thisoffering or the Distribution.

Kerr-McGee will indemnify us from all losses suffered by us arising out of certain circumstances or events, including:

�� liabilities of us and our subsidiaries relating to the exploration, development and production of oil and natural gas that havebeen expressly assumed by Kerr-McGee; and

�� any breach by Kerr-McGee of the master separation agreement or any of the other agreements (other than the transitionservices and tax sharing agreements, which contain their own indemnification provisions) entered into by us and Kerr-McGeein connection with our separation from Kerr-McGee.

Financial Reporting and Corporate Governance

Under the master separation agreement, until Kerr-McGee is no longer required to consolidate our results of operations and financialposition or account for its investment in us on the equity method of accounting, we will use our commercially reasonable efforts to enable ourindependent registered public accounting firm to complete their audit of our financial statements in a timely manner so as to permit timelyfiling of Kerr-McGee's financial statements. We have also agreed to provide Kerr-McGee and its independent registered public accountingfirm all information required for Kerr-McGee to meet its schedule for the preparation of its consolidated financial statements. We have agreedto adhere to specified accounting policies and to notify and consult with Kerr-McGee regarding any changes to our accounting policies andestimates used in the preparation of our financial statements. We also have agreed to provide certain financial and other informationconcerning our business, properties, financial position, results of operations, cash flows and prospects to Kerr-McGee.

With respect to governance matters, we have agreed that, for so long as Kerr-McGee owns at least a majority of the total voting power ofour outstanding voting common stock, we will not, among other things:

�� take any action that would limit the ability of Kerr-McGee to transfer shares of our Class B common stock or limit the rights ofany transferee of Kerr-McGee as a holder of our Class B common stock; or



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�� take any actions that could reasonably result in Kerr-McGee being in breach of or in default under any contract or agreement.

From the completion of the Transactions until the completion of the Distribution, we may not incur any additional indebtedness forborrowed money, other than pursuant to the revolving credit facility, without Kerr-McGee's consent.

We have also agreed that while Kerr-McGee owns at least a majority of our outstanding common stock, we will not issue any shares ofour capital stock, or any rights, warrants or options to purchase capital stock (other than any shares of our capital stock or options to acquireour capital stock granted in connection with the performance of services), if this would cause Kerr-McGee to own less than a majority of ouroutstanding common stock (on a fully diluted basis). In these circumstances, we also are restricted from issuing any shares of our capital stockif this would cause Kerr-McGee to own less than 80% of the total voting power of our outstanding capital stock entitled to vote generally inthe election of our directors and from issuing any shares of non-voting stock.

Expenses

We and Kerr-McGee generally will be responsible for our own costs (including all third-party costs) incurred in connection with thetransactions contemplated by the master separation agreement. However, we have agreed to pay all costs and expenses (including all third-party costs) related to this offering, including underwriting discounts and commissions and Kerr-McGee's financial, legal, accounting andother expenses, and Kerr-McGee has agreed to pay all costs and expenses (including all third-party costs) related to the Distribution.

Termination

Kerr-McGee, in its sole discretion, may terminate the master separation agreement at any time prior to completion of this offering.

Other Provisions

In addition to the terms and provisions described above, the master separation agreement prohibits Kerr-McGee from competing with usand provides for information sharing and dispute resolution between us and Kerr-McGee.

Transition Services Agreement

The transition services agreement governs the provision by Kerr-McGee to us and by us to Kerr-McGee of support services, such as:

�� accounting services;

�� tax services;

�� employee benefits management;

�� financial services;

�� legal services;

�� intellectual property management services;



�� risk and claims management;

�� disaster recovery services;

�� information management and technology services;

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�� technical support and laboratory services;

�� real estate management;

�� travel services; and

�� office administration services.

The terms of these services generally will expire one year after completion of this offering, subject to certain limited exceptions.

In consideration for each service to be provided under the transition services agreement, we and Kerr-McGee, as applicable, will chargeeach other an amount equal to the sum of (i) the fully-burdened labor costs of our respective employees involved in the provision of suchservice and (ii) third-party costs, out-of-pocket and other expenses and taxes (other than transfer taxes), in each case incurred by the partyproviding such service. Kerr-McGee also has agreed to incur certain transition costs necessary to initiate and facilitate the transition ofservices up to a maximum amount.

Transitional License Agreement

The transitional license agreement provides us with a royalty-free, non-transferable and non-assignable license to continue to use certaintrademarks, trade names, service marks, brand names, trade dress and logos that are owned indirectly by Kerr-McGee and are and have beenused in connection with the chemical business. The term of these licenses will generally expire 12 months after the completion of this offeringsubject to certain limited exceptions.

Registration Rights Agreement

The registration rights agreement provides Kerr-McGee with rights relating to the shares of our Class B common stock held by Kerr-McGee. Under the agreement, Kerr-McGee has the right to require us to register for offer and sale all or a portion of the shares of our Class Bcommon stock covered by the agreement, so long as the shares Kerr-McGee requires us to register represent at least 10% of the aggregateshares of our common stock issued and outstanding.

Shares Covered

The registration rights agreement covers those shares of our Class B common stock that are held by Kerr-McGee or a transferee of Kerr-McGee.

Demand Registration

Kerr-McGee may request registration under the Securities Act of all or any portion of our shares covered by the registration rightsagreement, and we will be obligated, subject to limited exceptions, to register such shares as requested by Kerr-McGee. The maximumnumber of registrations Kerr-McGee may require us to effect is five. Kerr-McGee has the right to designate the terms of each offering itrequests.

We are not required to undertake any demand registration requested by Kerr-McGee within 90 days after completion of a previously-requested demand registration other than pursuant to a shelf registration statement. In addition, we have the right, which may be exercisedonce in any 12-month period, to postpone the filing or effectiveness of any demand registration if we determine in the good faith judgment ofour general counsel, confirmed by our board of directors, that such registration would reasonably be expected to require the disclosure ofmaterial information that we have a business purpose to keep confidential and the disclosure of which would have a material adverse effect onany then-active proposals to engage in certain material transactions until the earlier of (i) 15 business days



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after the date of disclosure of such material information, or (ii) 75 days after we make such determination.

Piggy-Back Registration

If we at any time intend to file on our behalf or on behalf of any of our other security holders a registration statement in connection with apublic offering of any of our securities on a form and in a manner that would permit the registration for offer and sale of the shares of ourClass B common stock, Kerr-McGee has the right to have those shares included in that offering.

Registration Expenses

We are responsible for all registration expenses incurred in connection with the performance of our obligations under the registrationrights agreement. Kerr-McGee is responsible for all of the fees and expenses of counsel to Kerr-McGee, any applicable underwriting discountsor commissions, and any registration or filing fees incurred with respect to shares of our Class B common stock being sold under theregistration rights agreement.

Indemnification

The registration rights agreement contains indemnification and contribution provisions by us for the benefit of Kerr-McGee and itsaffiliates and representatives and, in limited situations, by Kerr-McGee for the benefit of us and any underwriters with respect to informationincluded in any registration statement, prospectus or related documents.

Transfer

Kerr-McGee may transfer shares covered by the registration rights agreement and the holders of such transferred shares will be entitled tothe benefits of the registration rights agreement, provided that each such transferee agrees to be bound by the terms of the registration rightsagreement.

Duration

The registration rights under the registration rights agreement will remain in effect with respect to any shares of Class B common stockcovered by the agreement until:

�� such shares have been sold pursuant to an effective registration statement under the Securities Act;

�� such shares have been sold to the public pursuant to Rule 144 under the Securities Act;

�� such shares have been otherwise transferred and new certificates evidencing such shares have been delivered and do not bear alegend restricting further transfer of such shares, provided that subsequent public distribution of such shares does not requireregistration or qualification of them under the Securities Act or any similar state law;

�� such shares have ceased to be outstanding; or

�� in the case of shares held by a transferee of Kerr-McGee, when such shares become eligible for sale pursuant to Rule 144(k)under the Securities Act (or any successor provision).



Tax Sharing Agreement

Allocation of Taxes

The tax sharing agreement governs Kerr-McGee's and our respective rights, responsibilities and obligations after this offering withrespect to taxes for tax periods ending on or before this offering.

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Generally, taxes incurred or accrued prior to this offering that are attributable to the business of one party will be borne solely by that party. Inaddition, the tax sharing agreement addresses the allocation of liability for taxes incurred as a result of restructuring activities undertaken toimplement the separation and distribution. We are required to indemnify Kerr-McGee for any tax liability incurred by reason of theDistribution by Kerr-McGee of our Class B common stock to its stockholders being considered a taxable transaction to Kerr-McGee as aresult of a breach of any of our representations, warranties or covenants contained in the tax sharing agreement.

Under U.S. federal income tax laws, we and Kerr-McGee are jointly and severally liable for Kerr-McGee's federal income taxesattributable to the periods prior to and including Kerr-McGee's current taxable year, which ends on December 31, 2005. This means that ifKerr-McGee fails to pay the taxes attributable to it under the tax sharing agreement for periods prior to and including its current taxable year,we may be liable for any part of, including the whole amount of, these tax liabilities.

Tax Limitations on Additional Issuances of Our Stock and Other Transactions

After the completion of this offering, we will be limited in our ability to issue shares and our ability to enter into transactions involvingacquisitions of our stock because of potential adverse tax consequences.

First, in order for the Distribution to be tax-free to Kerr-McGee and its stockholders, Kerr-McGee must distribute "control" of us, asdefined in Section 368(c) of the Internal Revenue Code. Under Section 368(c), "control" means ownership of stock possessing at least 80% ofthe total combined voting power of all classes of stock entitled to vote for the election and removal of directors and at least 80% of the totalnumber of shares of each other class of nonvoting stock outstanding. Because we will have only voting stock outstanding, Kerr-McGee mustdistribute stock representing at least 80% of the total combined voting power of our common stock for the election and removal of directors tosatisfy the Section 368(c) control test. If the option to purchase additional shares granted by us to the underwriters is exercised in full, we willhave issued stock representing 14.2% of our voting power in this offering. Thus, before the Distribution we may issue only a limited amountof our stock in acquisitions (or otherwise) without violating the Section 368(c) "control" test.

Second, under Section 355(e) of the Internal Revenue Code, Kerr-McGee will recognize taxable gain on the Distribution if there are (orhave been) one or more acquisitions of our stock representing 50% or more of our stock, measured by vote or value, and the stock acquisitionsare part of a plan or series of related transactions that includes the Distribution. The shares issued in this offering will be considered to be partof a plan that includes the Distribution. In addition, any other shares of our common stock acquired (directly or indirectly) within two yearsbefore or after the Distribution are presumed to be part of such a plan unless Kerr-McGee can rebut that presumption. Applicable TreasuryRegulations contain various safe harbors for purposes of determining whether other transactions will be considered part of a single "plan" thatincludes the Distribution, including a safe harbor for certain acquisitions occurring more than six months after the Distribution.

The tax sharing agreement prohibits us, for a two-year period following the Distribution, from issuing more than a minimal number ofour shares or from entering into transactions involving acquisitions of our shares. This prohibition does not apply to shares issued inconnection with the performance of services or if we obtain either a private letter ruling from the Internal Revenue Service or an independentcounsel's opinion (satisfactory to Kerr-McGee) to the effect that the proposed transaction or share issuance will not cause the Distribution tobe taxable to Kerr-McGee under Section 355(e). We are required to indemnify Kerr-McGee and its subsidiaries for any violation of the termsof the tax sharing agreement. Consequently, we are significantly limited in our ability to issue our shares in transactions that are negotiated orclosed within six months after the Distribution, and in transactions involving acquisitions of our shares within such six-month period, and wewill continue to

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be subject to restrictions on such transactions and the use of stock for acquisitions or otherwise after this six-month period.

Employee Benefits Agreement

The employee benefits agreement will provide detailed requirements with respect to the provision of retirement and other employeebenefits to our employees and former employees.

During the period immediately following the completion of this offering and before the completion of the Distribution by Kerr-McGee ofour Class B common stock to its stockholders, our employees and former employees will continue to participate in Kerr-McGee's employeebenefit plans, programs, and arrangements, except that we will create our own equity plan effective as of the date of this offering so that ouremployees will receive stock options or other equity-based awards that relate to the value of our common stock and not Kerr-McGee'scommon stock. We will bear our allocable share of the costs of the benefits and the administration of the Kerr-McGee plans in which ouremployees participate.

As of the effective date of the Distribution, we will establish independent retirement and other employee benefit plans that are alignedwith the retirement and other employee benefit plans generally made available by our competitors in the chemical industry. The employeebenefits agreement generally permits us, at any time, to amend or terminate any plan we establish to the extent permitted by law, with the onesignificant exception being that we cannot change the retiree medical or life insurance benefits available to our employees or formeremployees before the third anniversary of the Distribution.

General Principles

The employee benefits agreement generally provides that we will be responsible for all retirement and other employee benefit liabilitiesto our current employees and to former employees of the chemical division of Kerr-McGee (including former employees of our formerrefining, coal, offshore contract drilling, and nuclear business units), regardless of when these individuals retired or otherwise terminated theiremployment. As of the completion of the Distribution, Kerr-McGee will cease to have any responsibility for these liabilities, except as may berequired by law.

Incentive Plans

Annual incentive awards for the 2005 calendar year will be calculated in two separate pieces, each with its own performance targets.Kerr-McGee's plan will prorate the applicable performance targets for the period from January 1, 2005, until the date of this offering, andtransfer to us funds in an amount that reflects the extent to which those prorated targets were achieved. Our plan will then provide separateperformance targets and corresponding award opportunities for eligible employees from the date of the offering through the end of the 2005calendar year and will make a single payment to each eligible employee representing the sum of the two awards.

Long-term performance awards with performance cycles that began before this offering and end after the completion of this offering willbe treated differently. Awards that are vested at the effective date of the completion of the Distribution will be paid in accordance with theterms of the relevant plan. Awards or portions of awards that are unvested at that date will be forfeited, and we will issue an award under ourlong term incentive plan equal in value to the value of the forfeited award. The replacement award may be either an award of stock options topurchase our Class A common stock or restricted shares of our Class A common stock. To determine the number and terms of any stockoptions to be granted as a replacement award, the value of the forfeited award will be converted to a number of shares purchasable under astock option using the Black-Scholes methodology. To determine the number of restricted shares of our Class A common stock to issue as areplacement award, the

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value of the forfeited award will be divided by the price of our Class A common stock on effective date of the Distribution.

Health and Welfare Plans

We will adopt appropriate health and welfare benefit plans to provide benefits to our employees, including medical, dental, vision, life,disability and workers' compensation benefits, that are, in most instances, substantially similar to the health and welfare benefits provided toour employees by Kerr-McGee immediately prior to completion of the Distribution. We expect that we will assume from Kerr-McGee theprojected benefit obligation relating to eligible retired and active vested participants in the health and welfare benefit plans at the time of theDistribution. In connection with the establishment of our postretirement plans, we anticipate that the projected benefit obligation relating to alleligible retired and active vested participants related to us of approximately $148 million will be assumed by us upon completion of theDistribution. Under the employee benefits agreement, we are not permitted to change the retiree medical or life insurance benefits before thethird anniversary of the Distribution.

Retirement Plans

Effective upon completion of the Distribution, we intend to establish a new U.S. retirement benefit plan. This plan will be a tax-qualifieddefined benefit retirement plan and related trust for our employees and former employees who participated in Kerr-McGee's defined benefitretirement plans at the Distribution date. In addition to assuming liabilities, Kerr-McGee will transfer assets to us as set forth in the employeebenefits agreement from the trust for Kerr-McGee's defined benefit retirement plans to the trust for our plan. We anticipate that our plan willbe underfunded by approximately $14.4 million.

Savings Plans

We will establish a tax-qualified savings plan and related trust effective upon completion of the Distribution. Each of our employees andformer employees will be permitted to roll over all or part of their account balance, including outstanding participant loans, from Kerr-McGee's Savings Investment Plan into our plan, except that our plan will not accept the rollover of Kerr-McGee common stock. In general,any employee or former employee who wishes to continue to invest all or a portion of his or her savings account balance in the Kerr-McGeecommon stock fund will be permitted to do so by leaving all or a portion of his or her account in the Kerr-McGee plan.

Kerr-McGee Stock Options and Restricted Stock

Pursuant to the employee benefits agreement, Kerr-McGee unvested stock options and restricted shares of Kerr-McGee common stockheld by our employees and outstanding on the effective date of the Distribution will be converted to stock-based awards under our long-termincentive plan. As part of the conversion, we will multiply the number of Kerr-McGee shares covered by each converted stock-based award bya ratio determined in accordance with the terms of the employee benefits agreement. Employees who hold Kerr-McGee vested stock optionsgenerally may exercise such options for the lesser of three months after the effective date of the Distribution and the remaining term of theoption award. However, we anticipate that employees eligible for retirement on the effective date of the Distribution may be able to exercisetheir Kerr-McGee vested stock options for the lesser of four years after the effective date of the Distribution and the remaining term of theoption award.

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Kerr-McGee Executive Benefit Plans

Effective upon completion of the Distribution, we will establish a defined benefit non-qualified deferred compensation plan that willassume the obligations of the defined benefit portion of the Kerr-McGee Benefits Restoration Plan with respect to our employees and formeremployees who participated in that plan. We will also be assuming the Kerr-McGee Corporation Chemical Division Nonqualified RetirementPlan, as well as certain other specified supplemental pension obligations with respect to our employees and former employees, as described ingreater detail in the employee benefits agreement. Kerr-McGee will transfer assets, and we will assume obligations, as set forth in theemployee benefits agreement. Since it is anticipated that these plans will not be fully funded, we expect such transfer and assumption willresult in an obligation of approximately $3.9 million.

Benefits for Non-U.S. Employees

We currently provide defined benefit retirement plans for our employees in Germany and the Netherlands. The responsibility forproviding other benefits for those employees and benefits for other of our employees outside the United States will, to the extent permitted byapplicable law, be divided in a manner similar to the manner in which we and Kerr-McGee have divided benefit obligations for our U.S.employees. Similarly, stock opportunity grants relating to shares of Kerr-McGee common stock will be treated in a manner similar to shares ofrestricted stock, as discussed above. However, as provided in the employee benefits agreement, in many of the non-U.S. countries in which wedo business, we will be assuming employee benefit plans currently sponsored by Kerr-McGee or an entity related to Kerr-McGee rather thanestablishing new plans.

Assignment, Assumption and Indemnity Agreement

In connection with a corporate reorganization that took place on December 31, 2002, pursuant to an assignment, assumption andindemnity agreement, Tronox Worldwide assigned to Kerr-McGee Oil & Gas Corporation (an indirect subsidiary of Kerr-McGeeCorporation), liabilities arising out of the oil and gas exploration, production and development business formerly operated by a predecessor ofTronox Worldwide and then conducted by Kerr-McGee Oil & Gas. Tronox Worldwide retained liabilities related to any other businesses,operations, assets, or properties conducted or owned by it or its predecessors or subsidiaries. Kerr-McGee Oil & Gas agreed to indemnifyTronox Worldwide and its subsidiaries against losses related to the assigned liabilities, and Tronox Worldwide agreed to indemnify Kerr-McGee Corporation and its subsidiaries for losses related to liabilities retained by Tronox Worldwide.

Avestor Toll Manufacturing Agreement

Tronox LLC intends to enter into a toll manufacturing agreement with US Avestor LLC, or Avestor, in which Kerr-McGee indirectlyowns a 50% interest. The toll manufacturing agreement will memorialize the standing relationship between Tronox LLC and Avestor.Pursuant to the proposed toll manufacturing agreement, we will manufacture blended vanadium oxide at our Soda Springs, Idahomanufacturing facility and will provide research and development support to Avestor at our Oklahoma City research and development facility.

Pursuant to the terms of the proposed toll manufacturing agreement, we will supply the personnel, property and manufacturing andresearch facilities, and Avestor will supply the supervisory expertise, manufacturing equipment and raw materials necessary to manufactureand develop the blended vanadium oxide. Avestor will pay us for our actual costs incurred in performing the manufacturing and developmentservices under the toll manufacturing agreement plus an additional percentage of the actual costs. The proposed toll manufacturing agreementwill have an initial two-year term, after which it will renew annually unless terminated at either party's discretion.

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DESCRIPTION OF OUR CONCURRENT FINANCING TRANSACTIONS

Concurrent with this offering, Tronox Worldwide, which will become our direct wholly-owned subsidiary, will enter into a seniorsecured credit facility. Tronox Worldwide and Tronox Finance Corp. also will co-issue $350 million in aggregate principal amount ofunsecured notes in a concurrent private offering. The following summary is a description of the anticipated principal terms of the seniorsecured credit facility and the unsecured notes. The offering of our Class A common stock, the completion of the private offering of theunsecured notes and the entry into the senior secured credit facility are conditioned upon one another.

Senior Secured Credit Facility

The senior secured credit facility will consist of a $200 million six-year term loan facility and a five-year multicurrency revolving creditfacility of $250 million. The full amount of the revolving credit facility will be available for issuances of letters of credit and $25 million ofthe revolving credit facility will be available for borrowings of swingline loans. At closing, the term loan facility will be fully funded and thenet proceeds will be distributed to Kerr-McGee. Undrawn amounts under the revolving credit facility will be available on a revolving basis forworking capital and general corporate purposes of Tronox Worldwide and its subsidiaries, subject to specified conditions.

Security; Guarantees. The senior secured credit facility will be unconditionally and irrevocably guaranteed by us and TronoxWorldwide's direct and indirect material domestic subsidiaries (including Tronox Finance Corp.). In addition, the facility is expected to besecured by:

�� a pledge of 100% of the equity interests in Tronox Worldwide;

�� a pledge of 100% of the capital stock of, or other equity interests in, Tronox Worldwide's direct and indirect domesticsubsidiaries (including Tronox Finance Corp.);

�� a pledge of the capital stock of, or other equity interests in, Tronox Worldwide's direct foreign subsidiaries and the directforeign subsidiaries of the guarantors of the senior secured credit facility, up to 65% of the voting and 100% of the non-votingcapital stock or other equity interests outstanding; and

�� a first priority security interest in certain domestic assets, including certain real property, of Tronox Worldwide and theguarantors of the senior secured credit facility.

Interest. The interest rate per annum applicable to the loans will be a fluctuating rate of interest measured by reference to, at TronoxWorldwide's election, either LIBOR or an alternative base rate, plus a borrowing margin. Base rate loans will be referenced to the higher ofthe federal funds rate plus 0.50% or the prime rate. We expect the borrowing margins under the senior secured credit facility to vary in 0.25%increments in a range from 1.0% to 2.0% for LIBOR loans and from 0.0% to 1.0% for base rate loans, depending on the credit rating of thesenior secured credit facility.

Amortization. The term loan facility amortizes each year in an amount equal to 1% per year in equal quarterly installments for the firstfive years and in an amount equal to 95% per year in equal quarterly installments for the final year. Amounts drawn under the revolving creditfacility will be repaid at maturity.

Optional Prepayments. We may prepay the senior secured credit facility, in whole or in part, in minimum principal amounts of$5.0 million without premium or penalty. However, we may not reborrow against optional prepayments of the term loan facility.

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Mandatory Prepayments. The senior secured credit facility requires that we use the following amounts to prepay the term loan facility:

�� 100% of an amount equal to the net after-tax cash proceeds of any issuances or incurrence of any indebtedness not permittedby the senior secured credit facility;

�� 100% of an amount equal to the net after-tax cash proceeds of certain sales or other dispositions by us of any assets, unless wereinvest the proceeds within one year in capital assets or permitted acquisitions; and

�� 75% of an amount equal to excess cash flow for each fiscal year, commencing with fiscal year 2006.

The amount of excess cash flow that we must use for prepayments of the term loan facility will be reduced upon reaching financialperformance targets. We may not reborrow against mandatory prepayments of the term loan facility.

Fees. It is expected that we will be required to pay certain fees with respect to the new senior secured credit facility, including annualadministration fees, a commitment fee based on the undrawn portion of the revolving commitments and other similar fees.

Covenants. We expect that the senior secured credit facility will subject us to a number of covenants that will impose operatingrestrictions on us, including on our ability to incur indebtedness and liens, make loans and investments, sell assets, make capital expenditures,engage in mergers, consolidations and acquisitions, enter into transactions with affiliates, enter into sale and leaseback transactions, makeoptional payments or modifications of the unsecured notes or other material debt, change our lines of business and pay dividends on ourcommon stock. We will also be required to comply with financial covenant ratios that will be calculated by reference to adjusted EBITDA.We anticipate that the senior secured credit facility also will include a number of affirmative covenants which will require Tronox Worldwideto, among other things, deliver financial statements and other information to the lenders, comply with laws, maintain its corporate existenceand maintain its properties and insurance.

Events of Default. The senior secured credit facility is expected to contain customary events of default, including the following:

�� non-payment of principal, interest or other amounts when due;

�� violation of covenants;

�� inaccuracy of representations or warranties in any material respect;

�� cross-default caused by defaults under our other indebtedness;

�� a change of control; and

�� invalidity of any guarantee, security document or security interest.

Unsecured Notes



Concurrent with the closing of this offering, Tronox Worldwide and Tronox Finance Corp. are co-issuing $350 million in aggregateprincipal amount of unsecured notes due 2012 in a private offering. The unsecured notes will be offered and sold only to qualified institutionalbuyers in reliance on Rule 144A under the Securities Act and to certain non-U.S. persons in transactions outside the United States in relianceon Regulation S under the Securities Act. The unsecured notes are not being registered under the Securities Act and may not be offered or soldin the United States absent

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registration or an applicable exemption from registration requirements. Net proceeds from the offering of unsecured notes will be distributedto Kerr-McGee.

Guarantees. The unsecured notes will be unconditionally and irrevocably guaranteed by us and by Tronox Worldwide's material directand indirect wholly-owned domestic subsidiaries.

Mandatory and Optional Redemption Provisions. Tronox Worldwide and Tronox Finance Corp. will have the option to redeem theunsecured notes at any time at specified redemption prices on or after , 2009. Upon a change of control, Tronox Worldwide andTronox Finance Corp. will be required to make an offer to purchase the unsecured notes at a purchase price equal to 101% of their principalamount, plus accrued interest. Through the third anniversary of the date the unsecured notes are issued, Tronox Worldwide and TronoxFinance Corp. may redeem up to 35% of the aggregate principal amount of the unsecured notes using the net proceeds of certain equityofferings by us or Tronox Worldwide.

Covenants. The indenture governing the unsecured notes will contain covenants that, among other things, limit Tronox Worldwide's,Tronox Finance Corp.'s and the subsidiary guarantors' ability to:

�� incur additional indebtedness, including guarantees;

�� make investments, distributions and certain other restricted payments;

�� enter into transactions with affiliates;

�� impose restrictions on the ability of Tronox Worldwide's restricted subsidiaries to make certain payments to TronoxWorldwide and its other restricted subsidiaries;

�� create liens;

�� consummate certain asset sales; and

�� consolidate, merge or sell all or substantially all of Tronox Worldwide's consolidated assets.

Events of Default. Events of default under the indenture governing the unsecured notes will include:

�� our failure to pay principal or interest when due;

�� covenant defaults;

�� cross defaults on other material indebtedness, including the senior secured credit facility;



�� events of bankruptcy; and

�� other customary events of default.

Registration Rights. Tronox Worldwide, Tronox Finance Corp. and the subsidiary guarantors will enter into a registration rightsagreement with the initial purchasers of the unsecured notes pursuant to which they will agree to file a registration statement with theSecurities and Exchange Commission relating to an offer to exchange the unsecured notes and guarantees for publicly tradable notes andguarantees having substantially identical terms. In addition, the registration rights agreement will require Tronox Worldwide, Tronox FinanceCorp. and the subsidiary guarantors to file a shelf registration statement with the Securities and Exchange Commission in certaincircumstances covering resales of the notes and the guarantees by unsecured noteholders. The registration rights agreement will includedeadlines by which these actions must occur, and the failure to meet such deadlines could require payments of additional interest to theunsecured noteholders. Tronox Worldwide, Tronox Finance Corp. and the subsidiary guarantors will pay all expenses in connection with theregistration of the unsecured notes and guarantees.

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DESCRIPTION OF CAPITAL STOCK

The following is a description of the material terms of our capital stock as to be provided in our amended and restated certificate ofincorporation and amended and restated bylaws, as each is anticipated to be in effect upon the closing of this offering. We also refer you toour amended and restated certificate of incorporation and amended and restated bylaws, copies of which will be filed as exhibits to theregistration statement of which this prospectus forms a part prior to its effectiveness.

Authorized Capitalization

Following completion of this offering, our authorized capital stock will consist of (i) 100,000,000 shares of Class A common stock, parvalue $0.01 per share, (ii) 100,000,000 shares of Class B common stock, par value $0.01 per share, and (iii) 30,000,000 shares of preferredstock, par value $0.01 per share, of which 2,000,000 shares have been designated Series A junior participating preferred stock, par value $0.01per share. Of the 100,000,000 shares of Class A common stock, 17,480,000 shares are being offered in this offering (or 20,102,000 if theunderwriters fully exercise their option to purchase additional shares). Of the 100,000,000 shares of Class B common stock, 22,889,431 shareswill be outstanding and held by Kerr-McGee after completion of this offering (or 20,267,431 if the underwriters fully exercise their option topurchase additional shares). No shares of our preferred stock will be outstanding.

Authorized but unissued shares of our capital stock may be used for a variety of corporate purposes, including future public offerings, toraise additional capital or to facilitate acquisitions. The Delaware General Corporation Law does not require stockholder approval for anyissuance of authorized shares. However, the listing requirements of the New York Stock Exchange, which would apply so long as our Class Acommon stock were listed on the New York Stock Exchange, require stockholder approval of certain issuances equal to or exceeding 20% ofthe then outstanding voting power or then outstanding number of shares of Class A common stock.

Common Stock

Voting Rights. The holders of Class A common stock and Class B common stock generally have identical rights, except that holders ofClass A common stock are entitled to one vote per share while holders of Class B common stock are entitled to six votes per share on allmatters to be voted on by stockholders. Holders of shares of Class A common stock and Class B common stock are not entitled to cumulatetheir votes in the election of directors. Generally, except as discussed in "�Anti-Takeover Effects of Certificate of Incorporation and BylawsProvisions," all matters to be voted on by stockholders must be approved by a majority of the votes entitled to be cast by the holders ofClass A common stock and Class B common stock present in person or represented by proxy, voting together as a single class, subject to anyvoting rights granted to holders of any preferred stock. Except as otherwise provided by law or in the amended and restated certificate ofincorporation (as further discussed in "�Anti-Takeover Effects of Certificate of Incorporation and Bylaws Provisions"), and subject to anyvoting rights granted to holders of any outstanding preferred stock, amendments to the amended and restated certificate of incorporation mustbe approved by a majority of the votes entitled to be cast by the holders of Class A common stock and Class B common stock, voting togetheras a single class. Any provision for the voluntary, mandatory and other conversion or exchange of the Class B common stock into or forClass A common stock on a one-for-one basis, whether by amendment to the amended and restated certificate of incorporation, will bedeemed not to affect adversely the rights of the Class A common stock.

Dividends. Holders of Class A common stock and Class B common stock will share equally on a per share basis in any dividenddeclared by our board of directors, subject to any preferential rights of

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any outstanding shares of preferred stock. Dividends payable in shares of common stock may be paid only as follows:

�� shares of Class A common stock may be paid only to holders of Class A common stock, and

�� shares of Class B common stock may be paid only to holders of Class B common stock.

The number of shares so paid will be equal on a per share basis with respect to each outstanding share of Class A common stock andClass B common stock.

We may not reclassify, subdivide or combine shares of either class of common stock without at the same time proportionallyreclassifying, subdividing or combining shares of the other class.

Conversion. Each share of Class B common stock is convertible while beneficially owned by Kerr-McGee or any of its affiliates at theoption of the holder thereof into one share of Class A common stock. Following any distribution of Class B common stock to Kerr-McGeecommon stockholders in a transaction (including any distribution in exchange for Kerr-McGee shares or securities) intended to qualify as atax-free distribution under Section 355 of the Internal Revenue Code, or any corresponding provision of any successor statute (a Tax-FreeSpin-Off), shares of Class B common stock will no longer be convertible into shares of Class A common stock.

Prior to a Tax-Free Spin-Off, any shares of Class B common stock transferred to a person other than Kerr-McGee or any of its affiliateswill be converted automatically into shares of Class A common stock upon such transfer. Shares of Class B common stock transferred tostockholders of Kerr-McGee in a Tax-Free Spin-Off will not be converted into shares of Class A common stock and, following a Tax-FreeSpin-Off, shares of Class B common stock will be transferable as Class B common stock, subject to applicable laws.

All shares of Class B common stock will be converted automatically into Class A common stock if a Tax-Free Spin-Off has not occurredand the number of outstanding shares of Class B common stock beneficially owned by Kerr-McGee and its affiliates falls below 50% of theaggregate number of outstanding shares of our common stock. This automatic conversion of Class B common stock into Class A commonstock will prevent Kerr-McGee from decreasing its economic interest in our company to less than 50% while still retaining control of morethan 80% of our voting power. All conversions will be effected on a one-for-one basis.

Other Rights. Unless approved by 75% of the votes entitled to be cast by the holders of each class of our common stock, votingseparately as a class, in the event of any reorganization or consolidation of Tronox with one or more corporations or a merger of Tronox withanother corporation in which shares of common stock are converted into or exchangeable for shares of stock, other securities or property(including cash), all holders of our common stock, regardless of class, will be entitled to receive the same kind and amount of shares of stockand other securities and property (including cash).

On liquidation, dissolution or winding up of Tronox, after payment in full of the amounts required to be paid to holders of preferredstock, if any, all holders of common stock, regardless of class, are entitled to receive the same amount per share with respect to anydistribution of assets to holders of shares of common stock.

No shares of either class of common stock are subject to redemption or have preemptive rights to purchase additional shares of ourcommon stock or other securities.

Upon completion of this offering, all the outstanding shares of Class A common stock and Class B common stock will be validly issued,fully paid and nonassessable.

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Preferred Stock

Our amended and restated certificate of incorporation authorizes our board of directors to establish one or more series of preferred stock.Unless required by law or by any stock exchange on which our common stock is listed, the authorized shares of preferred stock will beavailable for issuance without further action by you. Our board of directors is able to determine, with respect to any series of preferred stock,the terms and rights of that series, including the following:

�� the designation of the series;

�� the number of shares of the series, which our board may, except where otherwise provided in the preferred stock designation,increase or decrease, but not below the number of shares then outstanding;

�� whether dividends, if any, will be cumulative or non-cumulative and the dividend rate of the series;

�� the dates at which dividends, if any, will be payable;

�� the redemption rights and price or prices, if any, for shares of the series;

�� the terms and amounts of any sinking fund provided for the purchase or redemption of shares of the series;

�� the amounts payable on shares of the series in the event of any voluntary or involuntary liquidation, dissolution or winding-upof the affairs of our company;

�� whether the shares of the series will be convertible into shares of any other class or series, or any other security, of ourcompany or any other corporation, and, if so, the specification of the other class or series or other security, the conversionprice or prices or rate or rates, any rate adjustments, the date or dates as of which the shares will be convertible and all otherterms and conditions upon which the conversion may be made;

�� restrictions on the issuance of shares of the same series or of any other class or series; and

�� the voting rights, if any, of the holders of the series.

The Rights Agreement

Our board of directors has approved a form of rights agreement that will become effective prior to this offering. Under such rightsagreement, one preferred share purchase right will be issued for each outstanding share of our Class A common stock and Class B commonstock (Class A Rights and Class B Rights). The rights being issued are subject to the terms of our rights agreement.



The purpose of the rights agreement is to protect our stockholders from coercive or otherwise unfair takeover tactics. In general terms,our rights agreement will work by imposing a significant penalty upon any person or group that acquires 15% or more of all of ouroutstanding Class A common stock, 15% or more of our outstanding Class B common stock, or any combination of our Class A and Class Bcommon stock representing 15% or more of the votes of all shares entitled to vote in the election of directors without the approval of ourboard of directors.

Provided below is the summary description of the rights agreement. Please note, however, that this description is only a summary of thematerial terms of the rights agreement and is not complete. You should read the full text of our rights agreement, which will be filed as anexhibit to the registration statement, of which this prospectus forms a part, prior to its effectiveness.

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The Rights

Our board of directors has authorized the issuance of one Class A Right for each share of our Class A common stock and one Class BRight for each share of our Class B common stock outstanding on the date this offering is completed. Our rights will initially trade with, andbe inseparable from, our common stock. Our Class A Rights and Class B Rights will be evidenced only by certificates that represent shares ofour Class A or Class B common stock. New rights will accompany any new shares of common stock we issue after the date this offering iscompleted until the date on which the rights are distributed as described below.

Exercise Price

Each of our rights will allow its holder to purchase from us one one-hundredth of a share of our Series A junior participating preferredstock for $ (subject to anti-dilution adjustments), once the rights become exercisable. Prior to exercise, our rights will not give itsholder any dividend, voting or liquidation rights. We will receive all of the proceeds from any exercise of our rights pursuant to the rightsagreement.

Exercisability

Our rights will not be exercisable until the earlier of:

�� ten days after the public announcement that a person or group has become an "acquiring person" by obtaining beneficialownership of 15% or more of our outstanding Class A or 15% or more of all of our outstanding Class B common stock, or anycombination of our Class A common stock and Class B common stock representing 15% or more of the votes of all sharesentitled to vote in the election of directors or,

�� ten business days (or a later date determined by our board of directors before any person or group becomes an acquiringperson) after a person or group begins a tender or exchange offer that, if completed, would result in that person or groupbecoming an acquiring person.

In light of Kerr-McGee's substantial ownership position, the rights agreement contains provisions excluding Kerr-McGee and its affiliatesfrom the operation of the adverse terms of our rights agreement.

Until the date our rights become exercisable, our common stock certificates also evidence our rights, and any transfer of shares of ourcommon stock constitutes a transfer of our rights. After that date, our rights will separate from our common stock and be evidenced by book-entry credits or by rights certificates that we will mail to all eligible holders of our common stock. Any of our rights held by an acquiringperson will be void and may not be exercised.

Consequences of a Person or Group Becoming an Acquiring Person

�� Flip In. If a person or group becomes an acquiring person, all holders of our Class A Rights except the acquiring person may,for the then applicable exercise price, purchase shares of our Class A common stock with a market value of twice the thenapplicable exercise price, based on the market price of our Class A common stock prior to such acquisition, and all holders ofour Class B Rights except the acquiring person may, for the then applicable exercise price, purchase shares of our Class Bcommon stock with a market value of twice the then applicable exercise price, based on the market price of our Class Bcommon stock prior to such acquisition.



�� Flip Over. If we are later acquired in a merger or similar transaction after the date our rights become exercisable, all holdersof our rights except the acquiring person may, for the then applicable exercise price, purchase shares of the acquiringcorporation with a market value of

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twice the then applicable exercise price, based on the market price of the acquiring corporation's stock prior to suchmerger.

Our Preferred Share Provisions

Each one one-hundredth of a share of our preferred stock, if issued:

�� will not be redeemable;

�� will entitle holders to quarterly dividend payments of $1.00 per share, or an amount equal to one hundred times the dividendpaid on one share of our common stock, whichever is greater;

�� will entitle holders upon liquidation either to receive $100 per share or an amount equal to one hundred times the paymentmade on one share of our common stock, whichever is greater;

�� will have the same voting power as one share of our Class A common stock; and

�� if shares of our Class A common stock or Class B common stock are exchanged via merger, consolidation or a similartransaction, will entitle holders to a per share payment equal to one hundred times the payment made on one share of ourClass A common stock or Class B common stock, as applicable.

The value of one one-hundredth interest in a share of our preferred stock purchasable upon exercise of each right should approximate thevalue of one share of our Class A common stock.

Exchange

After a person or group becomes an acquiring person, but before an acquiring person owns 50% or more of our outstanding commonstock, our board of directors may extinguish our rights by exchanging one share of our common stock or an equivalent security for each right,other than rights held by the acquiring person.

Redemption

Our board of directors will have the right to redeem our rights for $0.01 per right at any time before any person or group becomes anacquiring person. If our board of directors redeems any of our rights, it will be required to redeem all of our rights. Once our rights areredeemed, the only right of the holders of our rights will be to receive the redemption price of $0.01 per right. The redemption price will beadjusted if we have a stock split or stock dividends of our common stock.

Anti-Dilution Provisions

Our board of directors will have the right to adjust the purchase price of our preferred stock, the number of shares of our preferred stockissuable and the number of our outstanding rights to prevent dilution that may occur from a stock dividend, a stock split or a reclassification ofour preferred stock or common stock. No adjustments to the purchase price of our preferred stock of less than 1% will be made.

Amendments



Our board of directors will have the right to amend the terms of our rights agreement without the consent of the holders of our rights.After a person or group becomes an acquiring person, our board of directors will not be able to amend the agreement in a way that adverselyaffects holders of our rights.

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Expiration

Our rights will expire on November 7, 2015.

Anti-Takeover Effects of Certificate of Incorporation and Bylaws Provisions

Some provisions of our amended and restated certificate of incorporation and amended and restated bylaws could make the followingmore difficult, although they have little significance while we are controlled by Kerr-McGee:

�� acquisition of us by means of a tender offer or merger;

�� acquisition of us by means of a proxy contest or otherwise; or

�� removal of our incumbent officers and directors.

These provisions, summarized below, are expected to discourage coercive takeover practices and inadequate takeover bids. Theseprovisions also are designed to encourage persons seeking to acquire control of us to first negotiate with our board of directors. We believethat the benefits of the potential ability to negotiate with the proponent of an unfriendly or unsolicited proposal to acquire or restructure ourcompany outweigh the disadvantages of discouraging those proposals because negotiation of them could result in an improvement of theirterms.

Classified Board

Our amended and restated certificate of incorporation provides that our board of directors is divided into three classes. The term of thefirst class of directors expires at our 2006 annual meeting of stockholders, the term of the second class of directors expires at our 2007 annualmeeting of stockholders and the term of the third class of directors expires at our 2008 annual meeting of stockholders. The classes to whicheach of our current directors belong is discussed in "Management�Board of Directors." At each of our annual meetings of stockholders, thesuccessors of the class of directors whose term expires at that meeting of stockholders will be elected for a three-year term, one class beingelected each year by our stockholders. This system of electing and removing directors may discourage a third party from making a tender offeror otherwise attempting to obtain control of us if Kerr-McGee no longer controls us because it generally makes it more difficult forstockholders to replace a majority of our directors.

Election and Removal of Directors

Directors may be removed, with or without cause, by the affirmative vote of shares representing a majority of the votes entitled to be castby the outstanding capital stock in the election of our board of directors as long as Kerr-McGee owns shares representing at least a majority ofthe votes entitled to be cast by the outstanding capital stock in the election of our board of directors. Once Kerr-McGee ceases to own sharesrepresenting at least a majority of the votes entitled to be cast by the outstanding capital stock in the election of our board of directors, ouramended and restated certificate of incorporation requires that directors may only be removed for cause and only by the affirmative vote of notless than 75% of votes entitled to be cast by the outstanding capital stock in the election of our board of directors.

Size of Board and Vacancies

Our amended and restated certificate of incorporation provides that the number of directors on our board of directors will be fixedexclusively by our board of directors. Newly created directorships resulting from any increase in our authorized number of directors will befilled solely by the vote of our remaining directors in office. Any vacancies in our board of directors resulting from death, resignation,



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retirement, disqualification, removal from office or other cause will be filled solely by the vote of our remaining directors in office; provided,however, that as long as Kerr-McGee continues to beneficially own shares representing at least a majority of the votes entitled to be cast bythe outstanding capital stock in the election of our board of directors and such vacancy was caused by the action of stockholders, then suchvacancy also may be filled by the affirmative vote of shares representing at least a majority of the votes entitled to be cast by the outstandingcapital stock in the election of our board of directors.

Stockholder Action by Written Consent

Our amended and restated certificate of incorporation permits our stockholders to act by written consent without a meeting as long asKerr-McGee continues to beneficially own shares representing at least a majority of the votes entitled to be cast by the outstanding capitalstock in the election of our board of directors. Once Kerr-McGee ceases to beneficially own at least a majority of the votes entitled to be castby the outstanding capital stock in the election of our board of directors, our amended and restated certificate of incorporation eliminates theright of our stockholders to act by written consent.

Amendments to Certain Provisions of our Bylaws

Our amended and restated certificate of incorporation and amended and restated bylaws provide that the provisions of our amended andrestated bylaws relating to the calling of meetings of stockholders, notice of meetings of stockholders, stockholder action by written consent,advance notice of stockholder business or director nominations, the authorized number of directors, the classified board structure, the filling ofdirector vacancies or the removal of directors (and any provision relating to the amendment of any of these provisions) may only be amendedby the vote of a majority of our entire board of directors or, as long as Kerr-McGee owns shares representing at least a majority of the votesentitled to be cast by the outstanding capital stock in the election of our board of directors, by the vote of holders of a majority of the votesentitled to be cast by outstanding capital stock in the election of our board of directors. Once Kerr-McGee ceases to own shares representing atleast a majority of the votes entitled to be cast by the outstanding capital stock in the election of our board of directors, our amended andrestated certificate of incorporation and amended and restated bylaws provide that these provisions may only be amended by the vote of amajority of our entire board of directors or by the vote of holders of at least 75% of the votes entitled to be cast by the outstanding capitalstock in the election of our board of directors.

Amendment of Certain Provisions of our Certificate of Incorporation

The amendment of any of the above provisions in our amended and restated certificate of incorporation requires approval by holders ofshares representing at least a majority of the votes entitled to be cast by the outstanding capital stock in the election of our board of directors,as long as Kerr-McGee owns shares representing at least a majority of the votes entitled to be cast by the outstanding capital stock in theelection of our board of directors. Once Kerr-McGee ceases to own shares representing at least a majority of the votes entitled to be cast bythe outstanding capital stock in the election of our board of directors, our amended and restated certificate of incorporation and amended andrestated bylaws provide that these provisions may only be amended by the vote of a majority of our entire board of directors followed by thevote of holders of at least 75% of the votes entitled to be cast by the outstanding capital stock in the election of our board of directors.

Stockholder Meetings

Our amended and restated certificate of incorporation and amended and restated bylaws provide that a special meeting of ourstockholders may be called only by (i) Kerr-McGee, so long as it beneficially own at least a majority of the votes entitled to be cast by theoutstanding capital stock in

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the election of our board of directors or (ii) the chairman of our board of directors or our board of directors.

Requirements for Advance Notification of Stockholder Nominations and Proposals

Our amended and restated bylaws establish advance notice procedures with respect to stockholder proposals and nomination ofcandidates for election as directors other than nominations made by or at the direction of our board of directors or a committee of our board ofdirectors.

No Cumulative Voting

Our amended and restated certificate of incorporation and amended and restated bylaws do not provide for cumulative voting in theelection of directors.

Undesignated Preferred Stock

The authorization of our undesignated preferred stock makes it possible for our board of directors to issue our preferred stock with votingor other rights or preferences that could impede the success of any attempt to change control of us. These and other provisions may have theeffect of deferring hostile takeovers or delaying changes of control of our management.

Delaware Anti-Takeover Statute

We are subject to Section 203 of the Delaware General Corporation Law. Subject to specific exceptions, Section 203 prohibits a publiclyheld Delaware corporation from engaging in a "business combination" with an "interested stockholder" for a period of three years after thedate of the transaction in which the person became an interested stockholder, unless:

�� the "business combination," or the transaction in which the stockholder became an "interested stockholder" is approved by theboard of directors prior to the date the "interested stockholder" attained that status;

�� upon completion of the transaction that resulted in the stockholder becoming an "interested stockholder," the "interestedstockholder" owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced(excluding for purposes of determining the voting stock outstanding and not outstanding, voting stock owned by the interestedstockholder, those shares owned by persons who are directors and also officers, and employee stock plans in which employeeparticipants do not have the right to determine confidentiality whether shares held subject to the plan will be tendered in atender or exchange offer); or

�� on or subsequent to the date a person became an "interested stockholder," the "business combination" is approved by the boardof directors and authorized at an annual or special meeting of stockholders by the affirmative vote of at least two-thirds of theoutstanding voting stock that is not owned by the "interested stockholder."

"Business combinations" include mergers, asset sales and other transactions resulting in a financial benefit to the "interestedstockholder." Subject to various exceptions, an "interested stockholder" is a person who, together with his or her affiliates and associates,owns, or within the previous three years did own, 15% or more of the corporation's outstanding voting stock. These restrictions could prohibitor delay the accomplishment of mergers or other takeover or change in control attempts with respect to us and, therefore, may discourageattempts to acquire us.

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Limitations on Liability and Indemnification of Officers and Directors

The Delaware General Corporation Law authorizes corporations to limit or eliminate the personal liability of directors to corporationsand their stockholders for monetary damages for breaches of directors' fiduciary duties. Under our amended and restated certificate ofincorporation, subject to limitations imposed by the Delaware General Corporation Law, no director shall be personally liable to us or ourstockholders for monetary damages for breach of fiduciary duty as a director, except for liability:

�� for any breach of the director's duty of loyalty to the corporation or its stockholders;

�� for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law;

�� pursuant to Section 174 of the Delaware General Corporation Law (providing for liability of directors for unlawful payment ofdividends or unlawful stock purchases or redemptions); or

�� for any transaction from which a director derived an improper personal benefit.

Our amended and restated bylaws provide that we must indemnify our directors and officers to the fullest extent authorized by theDelaware General Corporation Law. We are also expressly authorized to advance certain expenses (including attorneys' fees anddisbursements and court costs) and carry directors' and officers' insurance providing indemnification for our directors, officers and certainemployees for some liabilities. We believe that these indemnification provisions and insurance are useful to attract and retain qualifieddirectors and executive officers. There is currently no pending material litigation or proceeding involving any of our directors, officers oremployees for which indemnification is sought.

Rights Agent, Transfer Agent and Registrar

UMB Bank, N.A. is the transfer agent and registrar for our Class A and Class B common stock.

Listing

Our Class A common stock has been approved for listing on the New York Stock Exchange under the symbol "TRX," subject to officialnotice of issuance.

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SHARES ELIGIBLE FOR FUTURE SALE

Prior to this offering, there has not been any public market for our Class A common stock, and a significant public market for our Class Acommon stock may not develop or be sustained after this offering. We cannot predict what effect, if any, market sales of shares of our Class Acommon stock or the availability of shares of our Class A common stock for sale will have on the market price of our Class A common stockprevailing from time to time. Nevertheless, sales of our Class A common stock in the public market, or the perception that such sales couldoccur, could adversely affect the market price of our Class A common stock and could make it more difficult for us to raise capital through thesale of our equity or equity-related securities at a time and price that we deem appropriate.

Upon the closing of this offering, we expect to have a total of 17,480,000 shares of our Class A common stock outstanding. If theunderwriters fully exercise their option to purchase additional shares, we expect to have 20,102,000 shares of our Class A common stockoutstanding upon the closing of this offering. All of the shares of our Class A common stock sold in this offering will be freely tradablewithout restriction or further registration under the Securities Act, except for "restricted" shares held by persons who may be deemed our"affiliates," as that term is defined under Rule 144 of the Securities Act. An "affiliate" is a person that directly, or indirectly through one ormore intermediaries, controls or is controlled by us or is under common control with us.

Rule 144

Affiliates will be permitted to sell their shares of Class A common stock that they purchase in this offering only through registrationunder the Securities Act or pursuant to an exemption from registration under the Securities Act, such as the exemption available by complyingwith Rule 144 of the Securities Act. In general, under Rule 144 in effect as of the date of this prospectus, beginning 90 days after the date ofthis prospectus, an affiliate who has beneficially owned shares of our Class A common stock for at least one year would be entitled to sell inbrokers' transactions a number of shares of such stock within any three-month period that does not exceed the greater of:

�� 1% of the number of shares of our Class A common stock then outstanding, which is approximately 175,000 shares of ourClass A common stock as of the date of this prospectus; and

�� the average weekly trading volume of our Class A common stock on the New York Stock Exchange during the four calendarweeks preceding each such sale, subject to restrictions.

Sales under Rule 144 are also subject to other requirements regarding the manner of sale, notice filing and the availability of currentpublic information about us.

Lock-Up Agreements

We, our directors, executive officers and Kerr-McGee have agreed with the underwriters that, without the underwriters' prior consent, wewill not sell, dispose of or hedge any shares of our common stock, subject to specified exceptions, during the period from the date of thisprospectus continuing through the date that is 180 days or, in the case of the proposed Distribution of our Class B shares by Kerr-McGee to itsstockholders, 120 days, after the date of this prospectus, except with the prior written consent of each of Lehman Brothers Inc. andJ.P. Morgan Securities Inc. See "Underwriting�Lock-Up Agreements."

Stock-Based Awards

We have reserved approximately 6.1 million shares of our Class A common stock for issuance under our long term incentive plan. Inconnection with this offering, our executive officers, non-employee directors (other than the Kerr-McGee directors) and certain employeeswill be awarded

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initial stock option grants to purchase approximately 0.4 million shares of our Class A common stock and approximately 0.4 million restrictedshares of our Class A common stock pursuant to our long term incentive plan. The stock option grants will vest over three years, with equalamounts vesting on each anniversary of the grant date. The exercise price per share of these stock options will be equal to the fair marketvalue of our Class A common stock on the date of this offering. The restrictions on the shares of restricted stock will lapse on the thirdanniversary of the grant date. In addition, under our employee benefits agreement with Kerr-McGee, Kerr-McGee stock-based awards held byour employees and outstanding on the effective date of the Distribution will be converted into stock-based awards under our long termincentive plan. See "Management�Treatment of Kerr-McGee Stock Options, Restricted Stock and Performance Unit Awards," "Arrangementsbetween Kerr-McGee and Our Company�Employee Benefits Agreement�Kerr-McGee Stock Options and Restricted Stock" and "Arrangementsbetween Kerr-McGee and Our Company�Employee Benefits Agreement�Incentive Plans."

We currently expect to file a registration statement under the Securities Act to register shares reserved for issuance under our long termincentive plan. Shares issued pursuant to awards after the effective date of such registration statement, other than shares issued to affiliates,generally will be freely tradable without further registration under the Securities Act.

Registration Rights

After the completion of this offering and the expiration of the lock-up period described above, Kerr-McGee will be entitled to certainrights to register its shares of our Class B common stock under the Securities Act, under the terms of a registration rights agreement betweenus and Kerr-McGee. We will bear all registration expenses if these registration rights are exercised, other than underwriting discounts andcommissions. These registration rights terminate as to Kerr-McGee's shares when Kerr-McGee may sell those shares under Rule 144(k) of theSecurities Act. Shares of our Class B common stock that are registered pursuant to the registration rights agreement will be freely transferable.

The Distribution

Kerr-McGee has advised us that, subject to the terms of its agreement with the underwriters (as discussed in "Underwriting�Lock-UpAgreements"), following completion of this offering, it intends to distribute all of the shares of our Class B common stock that it owns to itsstockholders. Kerr-McGee expects to accomplish the Distribution through a spin-off, split-off or a combination of both transactions.Completion of the Distribution is contingent upon the satisfaction or waiver of a variety of conditions described elsewhere in this prospectus.Kerr-McGee is not required to complete the Distribution and has the sole discretion to decide if and when the Distribution will occur and todetermine the form, structure and all other terms of any transactions to effect the Distribution. For a discussion of the conditions to thedistribution, see "Arrangements between Kerr-McGee and Our Company." Shares of our Class B common stock distributed to Kerr-McGeecommon stockholders in the Distribution generally will be freely transferable, except for shares of our Class B common stock received bypersons who may be deemed to be our affiliates.

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MATERIAL UNITED STATES FEDERAL INCOME AND ESTATETAX CONSEQUENCES TO NON-U.S. HOLDERS

The following is a general summary of the material United States federal income and estate tax consequences that may be relevant to thepurchase, ownership and disposition of our Class A common stock as of the date of this prospectus. Except where noted, this summary dealsonly with Class A common stock that is held as a capital asset by a non-U.S. holder.

A "non-U.S. holder" means a person (other than a partnership) that is not for United States federal income tax purposes any of thefollowing:

�� an individual citizen or resident of the United States;

�� a corporation (or any other entity treated as a corporation for United States federal income tax purposes) created or organizedin or under the laws of the United States, any state thereof or the District of Columbia;

�� an estate the income of which is subject to United States federal income taxation regardless of its source; or

�� a trust if it (1) is subject to the primary supervision of a court within the United States and one or more United States personshave the authority to control all substantial decisions of the trust or (2) has a valid election in effect under applicable UnitedStates Treasury regulations to be treated as a United States person.

This summary is based upon provisions of the Internal Revenue Code, or the Code, and regulations, rulings and judicial decisions as ofthe date of this prospectus. Those authorities may be changed, perhaps retroactively, so as to result in United States federal income and estatetax consequences different from those summarized below. This summary does not address all aspects of United States federal income andestate taxes and does not deal with foreign, state, local or other tax considerations that may be relevant to non-U.S. holders in light of theirpersonal circumstances. In addition, it does not represent a detailed description of the United States federal income and estate taxconsequences applicable to you if you are subject to special treatment under the United States federal income tax laws (including if you are aUnited States expatriate, "controlled foreign corporation," "passive foreign investment company," corporation that accumulates earnings toavoid United States federal income tax or an investor in a pass-through entity). A change in law could alter significantly the tax considerationsthat we describe in this summary.

If a partnership holds our Class A common stock, the tax treatment of a partner will generally depend upon the status of the partner andthe activities of the partnership. If you are a partner of a partnership holding our Class A common stock, you should consult your tax advisors.

If you are considering the purchase of our Class A common stock, you should consult your own tax advisors concerning theparticular United States federal income and estate tax consequences to you of the ownership of our Class A common stock, as well asthe consequences to you arising under the laws of any other taxing jurisdiction.

Dividends

Dividends paid to a non-U.S. holder of our Class A common stock generally will be subject to withholding of United States federalincome tax at a 30% rate or such lower rate as may be specified by an applicable income tax treaty. However, dividends that are effectivelyconnected with the conduct of a trade or business by the non-U.S. holder within the United States (and, where a tax treaty applies, areattributable to a United States permanent establishment of the non-U.S. holder) are not subject to the withholding tax, provided certaincertification and disclosure requirements are satisfied. Instead, such dividends are subject to United States federal income tax on a net incomebasis in the same



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manner as if the non-U.S. holder were a United States person as defined under the Code. Any such effectively connected dividends receivedby a foreign corporation may be subject to an additional "branch profits tax" at a 30% rate or such lower rate as may be specified by anapplicable income tax treaty.

A non-U.S. holder of our Class A common stock who wishes to claim the benefit of an applicable treaty rate for dividends will berequired to complete Internal Revenue Service Form W-8BEN (or other applicable form) and certify under penalty of perjury that such holderis eligible for benefits under the applicable treaty. Special certification and other requirements apply to certain non-U.S. holders that are pass-through entities rather than corporations or individuals. In addition, Treasury regulations provide special procedures for payments of dividendsthrough certain intermediaries.

A non-U.S. holder of our Class A common stock eligible for a reduced rate of United States withholding tax pursuant to an income taxtreaty may obtain a refund of any excess amounts withheld by filing an appropriate claim for refund with the Internal Revenue Service.

Gain on Disposition of Common Stock

Any gain realized on the disposition of our Class A common stock generally will not be subject to United States federal income taxunless:

�� the gain is effectively connected with a trade or business of the non-U.S. holder in the United States (and, if required by anapplicable income tax treaty, is attributable to a United States permanent establishment of the non-U.S. holder);

�� the non-U.S. holder is an individual who is present in the United States for 183 days or more in the taxable year of thatdisposition, and certain other conditions are met; or

�� we are or have been a "United States real property holding corporation" for United States federal income tax purposes andcertain other conditions are met.

An individual non-U.S. holder described in the first bullet point immediately above will be subject to tax on the net gain derived from thesale under regular graduated United States federal income tax rates. An individual non-U.S. holder described in the second bullet pointimmediately above will be subject to a flat 30% tax on the gain derived from the sale, which may be offset by United States source capitallosses, even though the individual is not considered a resident of the United States. If a non-U.S. holder that is a foreign corporation fallsunder the first bullet point immediately above, it will be subject to tax on its net gain in the same manner as if it were a United States person asdefined under the Code and, in addition, may be subject to the branch profits tax equal to 30% of its effectively connected earnings and profitsor at such lower rate as may be specified by an applicable income tax treaty.

We believe we are not and do not anticipate becoming a "United States real property holding corporation" for United States federalincome tax purposes.

Federal Estate Tax

Class A common stock held by an individual non-U.S. holder at the time of death will be included in such holder's gross estate for UnitedStates federal estate tax purposes, unless an applicable estate tax treaty provides otherwise.

Information Reporting and Backup Withholding



We must report annually to the Internal Revenue Service and to each non-U.S. holder the amount of dividends paid to such holder andthe tax withheld with respect to such dividends, regardless of whether withholding was required. Copies of the information returns reportingsuch dividends and

133



withholding may also be made available to the tax authorities in the country in which the non-U.S. holder resides under the provisions of anapplicable income tax treaty.

A non-U.S. holder will be subject to backup withholding for dividends paid to such holder unless such holder certifies under penalty ofperjury that it is a non-U.S. holder (and the payor does not have actual knowledge or reason to know that such holder is a United States personas defined under the Code), or such holder otherwise establishes an exemption.

Information reporting and, depending on the circumstances, backup withholding will apply to the proceeds of a sale of our Class Acommon stock within the United States or conducted through certain United States-related financial intermediaries, unless the beneficialowner certifies under penalty of perjury that it is a non-U.S. holder (and the payor does not have actual knowledge or reason to know that thebeneficial owner is a United States person as defined under the Code) or such owner otherwise establishes an exemption. Certain stockholders,including all corporations, are exempt from the backup withholding rules.

Any amounts withheld under the backup withholding rules may be allowed as a refund or a credit against a non-U.S. holder's UnitedStates federal income tax liability provided the required information is furnished to the Internal Revenue Service.

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UNDERWRITING

Lehman Brothers Inc. and J.P. Morgan Securities Inc. are acting as representatives of the underwriters. Under the terms of anUnderwriting Agreement, which will be filed as an exhibit to the registration statement, of which this prospectus forms a part, prior to itseffectiveness, each of the underwriters named below has severally agreed to purchase from us the respective number of shares of our Class Acommon stock shown opposite its name below:

UnderwritersNumber of

SharesLehman Brothers Inc.J.P. Morgan Securities Inc.Citigroup Global Markets Inc.Credit Suisse First Boston LLCABN AMRO Rothschild LLCFriedman, Billings, Ramsey & Co., Inc.Scotia Capital (USA) Inc.SG Americas Securities, LLCSunTrust Capital Markets, Inc.

Total 17,480,000

The underwriting agreement provides that the underwriters' obligation to purchase shares of our Class A common stock depends on thesatisfaction of the conditions contained in the underwriting agreement including:

�� the representations and warranties made by us to the underwriters are true;

�� there is no material change in the financial markets; and

�� we deliver customary closing documents to the underwriters.

The underwriting agreement further provides that the underwriters are obligated to purchase all of the shares of common stock offered bythis prospectus if any of the shares are purchased.

Commissions and Expenses

The following table summarizes the underwriting discounts and commissions we will pay to the underwriters. These amounts are shownassuming both no exercise and full exercise of the underwriters' option to purchase additional shares. The underwriting fee is the differencebetween the initial price to the public and the amount the underwriters pay us for the shares.

No ExerciseFull

ExercisePer shareTotal

The representatives of the underwriters have advised us that the underwriters propose to offer the shares of our Class A common stockdirectly to the public at the public offering price on the cover of this prospectus and to selected dealers, which may include the underwriters, atsuch offering price less a selling concession not in excess of $ per share. The underwriters may allow, and the selected



dealers may re-allow, a discount from the concession not in excess of $ per share to other dealers. After the offering, the representativesmay change the offering price and other selling terms.

The expenses of this offering that are payable by us are estimated to be $2.7 million (excluding underwriting discounts andcommissions).

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Option to Purchase Additional Shares

We have granted the underwriters an option, exercisable for 30 days after the date of this prospectus, to purchase, from time to time, inwhole or in part, up to an aggregate of 2,622,000 shares at the public offering price less underwriting discounts and commissions. This optionmay be exercised if the underwriters sell more than 17,480,000 shares in connection with this offering. To the extent that this option isexercised, each underwriter will be obligated, subject to certain specified conditions, to purchase its pro rata portion of these additional sharesbased on the underwriter's percentage underwriting commitment in the offering as indicated in the table at the beginning of this UnderwritingSection.

Lock-Up Agreements

We, all of our directors and executive officers and Kerr-McGee have agreed that, without the prior written consent of each of LehmanBrothers Inc. and J.P. Morgan Securities Inc., we and they will not directly or indirectly, offer, pledge, announce the intention to sell, sell,contract to sell, sell an option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, orotherwise transfer or dispose of any shares of our common stock or any securities which may be converted into or exchanged for any shares ofour common stock or enter into any swap or other agreement that transfers, in whole or in part, any of the economic consequences ofownership of shares of our common stock for a period of 180 days, or, in the case of the proposed Distribution of our shares by Kerr-McGeeto its stockholders, 120 days, after the date of this prospectus other than permitted transfers. Lehman Brothers Inc. and J.P. Morgan SecuritiesInc. have sole discretion to waive compliance with these restrictions.

Each restricted period described in the preceding paragraph will be extended if:

�� during the last 17 days of such period, we issue an earnings release or announce material news or a material event; or

�� prior to the expiration of such period, we announce that we will release earnings results during the 16-day period beginning onthe last day of such period,

in which case the restrictions described in the preceding paragraph will continue to apply until the expiration of the 18-day period beginningon the issuance of the earnings release or the announcement of the material news or material event, as applicable.

Offering Price Determination

Prior to this offering, there has been no public market for our common stock. The initial public offering price will be negotiated betweenthe representatives and us. In determining the initial public offering price of our common stock, the representatives will consider:

�� the history and prospectus for the industry in which we compete,

�� our financial information,

�� the ability of our management and our business potential and earning prospectus,

�� the prevailing securities markets at the time of this offering, and

�� the recent market prices of, and the demand for, publicly traded shares of generally comparable companies.



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Indemnification

We have agreed to indemnify the underwriters against certain specified liabilities, including liabilities under the Securities Act, and tocontribute to payments that the underwriters may be required to make for these liabilities.

Stabilization, Short Positions and Penalty Bids

The representatives may engage in stabilizing transactions, short sales and purchases to cover positions created by short sales, andpenalty bids or purchases for the purpose of pegging, fixing or maintaining the price of the common stock, in accordance with Regulation Munder the Securities Exchange Act of 1934:

�� Stabilizing transactions permit bids to purchase the underlying security so long as the stabilizing bids do not exceed a specifiedmaximum.

�� A short position involves a sale by the underwriters of shares in excess of the number of shares the underwriters are obligatedto purchase in the offering, which creates the syndicate short position. This short position may be either a covered shortposition or a naked short position. In a covered short position, the number of shares involved in the sales made by theunderwriters in excess of the number of shares they are obligated to purchase is not greater than the number of shares that theymay purchase by exercising their option to purchase additional shares. In a naked short position, the number of shares involvedis greater than the number of shares in their option to purchase additional shares. The underwriters may close out any shortposition by either exercising their option to purchase additional shares or purchasing shares in the open market. In determiningthe source of shares to close out the short position, the underwriters will consider, among other things, the price of sharesavailable for purchase in the open market as compared to the price at which they may purchase shares through their option topurchase additional shares. A naked short position is more likely to be created if the underwriters are concerned that therecould be downward pressure on the price of the shares in the open market after pricing that could adversely affect investorswho purchase in the offering.

�� Syndicate covering transactions involve purchases of the common stock in the open market after the distribution has beencompleted in order to cover syndicate short positions.

�� Penalty bids permit the representatives to reclaim a selling concession from a syndicate member when the common stockoriginally sold by the syndicate member is purchased in a stabilizing or syndicate covering transaction to cover syndicate shortpositions.

These stabilizing transactions, syndicate covering transactions and penalty bids may have the effect of raising or maintaining the marketprice of our common stock or preventing or retarding a decline in the market price of the common stock. As a result, the price of the commonstock may be higher than the price that might otherwise exist in the open market. These transactions may be effected on The New York StockExchange or otherwise and, if commenced, may be discontinued at any time.

Neither we nor any of the underwriters make any representation or prediction as to the direction or magnitude of any effect that thetransactions described above may have on the price of the common stock. In addition, neither we nor any of the underwriters makerepresentation that the representatives will engage in these stabilizing transactions or that any transaction, once commenced, will not bediscontinued without notice.

Electronic Distribution

A prospectus in electronic format may be made available on the Internet sites or through other online services maintained by one or moreof the underwriters or selling group members participating in this offering, or by their affiliates. In those cases, prospective investors may



view offering terms online and, depending upon the particular underwriter or selling group member, prospective investors may be allowed toplace orders online. The underwriters may agree with us to allocate a specific

137



number of shares for sale to online brokerage account holders. Any such allocation for online distributions will be made by the representativeson the same basis as other allocations.

Other than the prospectus in electronic format, the information on any underwriter's or selling group member's web site and anyinformation contained in any other web site maintained by an underwriter or selling group member is not part of the prospectus or theregistration statement of which this prospectus forms a part, has not been approved or endorsed by us or any underwriter or selling groupmember in its capacity as underwriter or selling group member and should not be relied upon by investors.

The New York Stock Exchange

Our Class A common stock has been approved for listing on the New York Stock Exchange under the symbol "TRX," subject to officialnotice of issuance.

Discretionary Sales

We have been informed by the underwriters that they will not confirm sales to discretionary accounts over which they exercisediscretionary authority without the prior written approval of the customer.

Stamp Taxes

If you purchase shares of common stock offered in this prospectus, you may be required to pay stamp taxes and other charges under thelaws and practices of the country of purchase, in addition to the offering price listed on the cover page of this prospectus.

Relationships

Lehman Brothers Inc. and J.P. Morgan Securities Inc. and their respective affiliates have performed dealer manager, investment banking,commercial banking and advisory services for Kerr-McGee, for which they have received customary fees and expenses. Additionally, with theexception of Friedman, Billings, Ramsey & Co., Inc., or FBR, affiliates of each of the underwriters are lenders under Kerr-McGee's existingsecured credit facility.

Lehman Brothers Inc., Credit Suisse First Boston ABN AMRO Bank, N.V. and SunTrust Capital Markets, Inc. are also serving as initialpurchasers in a joint private offering by Tronox Worldwide and Tronox Finance Corp. of unsecured notes, and affiliates of each of theunderwriters (other than FBR) will be lenders and/or agents under the senior secured facility to be entered into concurrently with the closingof this offering. Additionally, under an engagement letter between it and Kerr-McGee, Lehman Brothers Inc. had the right to arrange for thisoffering on a lead-managed basis and as the book-running manager.

Kerr-McGee has advised us that it may use the net proceeds of this offering to repay loans under its existing secured credit facility. IfKerr-McGee makes such a repayment, and affiliates of the underwriters that are lenders under such secured credit facility receive more than10% of the net proceeds of this offering, the underwriters would be required to comply with the Conduct Rules of the National Association ofSecurities Dealers, Inc., or NASD, relating to a "conflict of interest." When a member of the NASD with a conflict of interest participates asan underwriter in a public offering, Rule 2720 requires that the initial public offering price be no higher than that recommended by a"qualified independent underwriter," as defined by the NASD. In accordance with this rule, FBR has agreed to act as a qualified independentunderwriter in the event Kerr-McGee decides to apply the proceeds of this offering to the repayment of loans outstanding under its securedcredit facility. We have agreed to indemnify FBR against liabilities incurred in connection with acting in such capacity, including liabilitiesunder the Securities Act.

The underwriters and their affiliates may in the future perform investment banking and advisory services for us from time to time forwhich they may in the future receive customary fees and expenses. The underwriters may, from time to time, engage in transactions with orperform services for us in the ordinary course of their business.



138



LEGAL MATTERS

The validity of the issuance of the shares of Class A common stock offered by this prospectus will be passed upon for us by Covington &Burling, Washington, D.C., and for the underwriters by Akin Gump Strauss Hauer & Feld LLP, Houston, Texas.

EXPERTS

Ernst & Young LLP, independent registered public accounting firm, has audited the combined financial statements and schedule atDecember 31, 2004 and 2003, and for each of the three years in the period ended December 31, 2004, as set forth in their report. We haveincluded the combined financial statements and schedule in this prospectus and elsewhere in the registration statement in reliance on Ernst &Young LLP's report, given on their authority as experts in accounting and auditing.

WHERE YOU CAN FIND ADDITIONAL INFORMATION

We have filed with the SEC a registration statement on Form S-1 under the Securities Act with respect to the issuance of shares of ourClass A common stock being offered by this prospectus. This prospectus, which forms a part of the registration statement, does not contain allof the information set forth in the registration statement. For further information with respect to us and the shares of our Class A commonstock, reference is made to the registration statement.

We are not currently subject to the informational requirements of the Exchange Act. As a result of this offering, we will become subjectto the informational requirements of the Exchange Act, and, in accordance therewith, will file reports and other information with the SEC. Theregistration statement, such reports and other information can be inspected and copied at the Public Reference Room of the SEC located atRoom 1580, Headquarters Office, 100 F Street, N.E., Washington D.C. 20549. Copies of such materials, including copies of all or any portionof the registration statement, can be obtained from the Public Reference Room of the SEC at prescribed rates. You can call the SEC at1-800-SEC-0330 to obtain information on the operation of the Public Reference Room. Such materials may also be accessed electronically bymeans of the SEC's home page on the Internet (http://www.sec.gov).

Our website address is www.tronox.com. We intend to make our annual reports on Form 10-K, quarterly reports on Form 10-Q, currentreports on Form 8-K and amendments to those reports filed with or furnished to the SEC available free of charge on our website as soon asreasonably practicable after they are electronically filed with or furnished to the SEC. The information on our website is not incorporated byreference into this prospectus, and you should not consider information on our website a part of this prospectus.

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INDEX TO COMBINED FINANCIAL STATEMENTS

Tronox Combined Financial Statements

Report of Independent Registered Public Accounting Firm

Combined Statement of Operations for the years ended December 31, 2004, 2003 and 2002

Combined Balance Sheet at December 31, 2004 and 2003

Combined Statement of Cash Flows for the years ended December 31, 2004, 2003 and 2002

Combined Statement of Comprehensive Income (Loss) and Business Equity for the years ended December 31, 2004, 2003 and 2002

Notes to Combined Financial Statements

Interim Tronox Condensed Combined Financial Statements (Unaudited)

Condensed Combined Statement of Operations for the nine months ended September 30, 2005 and 2004

Condensed Combined Balance Sheet at September 30, 2005 and December 31, 2004

Condensed Combined Statement of Cash Flows for the nine months ended September 30, 2005 and 2004

Condensed Combined Statement of Comprehensive Income (Loss) and Business Equity for the nine months ended September 30, 2005 and2004

Notes to Condensed Combined Financial Statements

F-1



Report of Independent Registered Public Accounting Firm

The Board of DirectorsTronox Incorporated

We have audited the accompanying combined balance sheets of Tronox as of December 31, 2004 and 2003, and the related combinedstatements of operations, comprehensive income (loss) and business equity, and cash flows for each of the three years in the period endedDecember 31, 2004. Our audits also included the financial statement schedule listed at Item 16(b). These financial statements and schedule arethe responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements and schedule basedon our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Thosestandards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of materialmisstatement. We were not engaged to perform an audit of the Company's internal control over financial reporting. Our audit includedconsideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances,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. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financialstatements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well asevaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the combined financial position of Tronox atDecember 31, 2004 and 2003, and the combined results of their operations and their cash flows for each of the three years in the period endedDecember 31, 2004, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial statementschedule, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material respects the informationset forth therein.

As discussed in Notes 2 and 17 to the combined financial statements, effective January 1, 2003, the Company adopted Statement of FinancialAccounting Standards No. 143, Accounting for Asset Retirement Obligations.

/s/ Ernst & Young LLP

Oklahoma City, OklahomaJune 3, 2005

F-2



TRONOX

COMBINED STATEMENT OF OPERATIONS

For the years ended December 31,

2004 2003 2002

(Millions, except per share amounts)

Net sales $ 1,301.8 $ 1,157.7 $ 1,064.3Cost of goods sold 1,168.9 1,024.7 949.0

Gross margin 132.9 133.0 115.3Selling, general and administrative expenses 110.1 98.9 84.0Restructuring charges 113.0 61.4 11.8Provision for environmental remediation and restoration, net of reimbursements 4.6 14.9 14.3

(94.8) (42.2) 5.2Other income (expense) (25.3) (20.6) (13.2)

Loss from Continuing Operations before Income Taxes (120.1) (62.8) (8.0)Income Tax Benefit (Provision) 38.3 15.1 (8.3)

Loss from Continuing Operations before Cumulative Effect of Change inAccounting Principle

(81.8) (47.7) (16.3)

Loss from Discontinued Operations, net of income tax benefit of $24.7, $19.3, and$43.6, respectively

(45.8) (35.8) (81.0)

Loss before Cumulative Effect of Change in Accounting Principle (127.6) (83.5) (97.3)Cumulative Effect of Change in Accounting Principle, net of income tax benefit of $4.9 � (9.2) �

Net Loss $ (127.6) $ (92.7) $ (97.3)

Pro forma loss per common share (unaudited):Basic and diluted $ (5.57)Pro forma weighted average common shares outstanding (unaudited):Basic and diluted 22.9Pro forma as if income taxes were presented on a stand-alone basis (Unaudited):Loss from Continuing Operations before Income Taxes $ (120.1)Income Tax Provision (5.9)

Loss from Continuing Operations (126.0)Loss from Discontinued Operations (70.5)

Net Loss $ (196.5)

The accompanying notes are an integral part of these statements.



F-3



TRONOX

COMBINED BALANCE SHEET

At December 31,

2004 2003

(Millions of dollars)

ASSETSCurrent Assets

Cash and cash equivalents $ 23.8 $ 59.3Accounts receivable, net of allowance for doubtful accounts of $11.0 in 2004 and $9.0 in 2003 222.2 150.8Inventories 285.1 352.6Prepaid and other assets 34.4 53.0Income tax receivable 12.7 6.9Deferred income taxes 17.9 27.9Assets held for sale 3.4 3.8

Total Current Assets 599.5 654.3

Property, Plant and Equipment��Net 883.0 961.6Long-Term Receivables, Investments and Other Assets 48.3 126.6Goodwill and Other Intangible Assets 65.1 66.6

Total Assets $ 1,595.9 $ 1,809.1

LIABILITIES AND BUSINESS EQUITYCurrent Liabilities

Accounts payable $ 196.0 $ 198.0Accrued liabilities 163.3 151.8

Total Current Liabilities 359.3 349.8

Noncurrent LiabilitiesDeferred income taxes 101.2 212.8Environmental remediation and/or restoration 130.8 135.9Other 114.7 99.4

Total Noncurrent Liabilities 346.7 448.1

Contingencies and Commitments (Notes 21 and 22)

Business EquityOwner's net investment 818.6 946.7Accumulated other comprehensive income 71.3 64.5

Total Business Equity 889.9 1,011.2



Total Liabilities and Business Equity $ 1,595.9 $ 1,809.1


F-4



TRONOX

COMBINED STATEMENT OF CASH FLOWS

For the years ended December 31,

2004 2003 2002


Cash Flows from Operating ActivitiesNet loss $ (127.6) $ (92.7) $ (97.3)Adjustments to reconcile net loss to net cash provided by operatingactivities�

Depreciation and amortization 104.6 106.5 105.7Deferred income taxes (38.2) 25.9 (5.9)Asset write-downs and impairments 122.4 28.7 20.2Cumulative effect of change in accounting principle � 9.2 �

Provision for environmental remediation and restoration, net ofreimbursements

66.1 56.0 75.4

Allocations from Kerr-McGee 55.1 65.8 51.6Other noncash items affecting net loss 31.9 29.0 66.7Changes in assets and liabilities

(Increase) decrease in accounts receivable (41.6) 13.3 (7.7)Decrease in inventories 59.9 10.4 42.2(Increase) decrease in prepaid and other assets 5.6 (0.5) (6.0)Decrease in accounts payable and accrued liabilities (17.8) (10.3) (47.7)Increase (decrease) in income taxes payable 12.6 (29.1) 5.7Other (42.2) (91.8) (120.5)

Net cash provided by operating activities 190.8 120.4 82.4

Cash Flows from Investing ActivitiesCapital expenditures (92.5) (99.4) (86.7)Other investing activities 1.1 3.7 0.1

Net cash used in investing activities (91.4) (95.7) (86.6)

Cash Flows from Financing ActivitiesNet transfers with affiliates (131.1) (10.0) 14.3Repayment of debt � � (8.2)Dividends paid � � (2.0)Other financing activities � (0.3) �

Net cash (used in) provided by financing activities (131.1) (10.3) 4.1

Effects of Exchange Rate Changes on Cash and Cash Equivalents (3.8) 4.7 2.3



Net Increase (Decrease) in Cash and Cash Equivalents (35.5) 19.1 2.2Cash and Cash Equivalents at Beginning of Year 59.3 40.2 38.0

Cash and Cash Equivalents at End of Year $ 23.8 $ 59.3 $ 40.2


F-5



TRONOX

COMBINED STATEMENT OF COMPREHENSIVE INCOME (LOSS) AND BUSINESS EQUITY

Owner's Net

Investment

Accumulated

Other

Comprehensive

Income

Total

Business

Equity


Balance at December 31, 2001 $ 1,117.3 $ (45.9) $ 1,071.4Comprehensive Income (Loss):

Net loss (97.3) � (97.3)Other comprehensive income � 53.6 53.6

Comprehensive loss (43.7)Net transfers from Kerr-McGee 34.7 � 34.7

Balance at December 31, 2002 1,054.7 7.7 1,062.4Comprehensive Income (Loss):


Comprehensive loss (35.9)Net transfers to Kerr-McGee (15.3) � (15.3)

Balance at December 31, 2003 946.7 64.5 1,011.2Comprehensive Income (Loss):



Balance at December 31, 2004 $ 818.6 $ 71.3 $ 889.9


F-6



Notes to Combined Financial Statements

1. The Company

The accompanying financial statements reflect the combined financial position and combined results of operations of certain subsidiariesof Kerr-McGee Corporation ("Kerr-McGee"). In these combined financial statements, we refer to those subsidiaries collectively as "Tronox"or the "company." The company is primarily engaged in the global production and marketing of titanium dioxide, a white pigment used in awide range of products. Tronox has production facilities in the United States, Germany and the Netherlands, mining and production facilitiesin Australia, and a European marketing subsidiary in Switzerland. The company has in the past operated or held businesses or properties, orcurrently holds properties, that do not relate to the current chemical business.

On March 8, 2005, Kerr-McGee's Board of Directors authorized Kerr-McGee's management to pursue alternatives for the separation ofthe company, including through a spin-off, split-off or sale. On May 17, 2005, Tronox Incorporated, an indirect wholly-owned subsidiary ofKerr-McGee, was formed in Delaware as "New-Co Chemical, Inc." to effect that separation. Prior to the closing of this offering, the companywill be contributed and transferred to Tronox Incorporated (the "Contribution"). Kerr-McGee has announced that after completion of thisoffering it intends to distribute its remaining ownership interest in Tronox Incorporated to its common stockholders (the "Distribution"). Kerr-McGee expects to accomplish this Distribution through a spin-off, split-off or a combination of both transactions. Kerr-McGee has the solediscretion to decide if and when the Distribution will occur and to determine the form, the structure and all other terms of any transactions toeffect the Distribution.


The combined financial statements have been derived from the accounting records of Kerr-McGee, principally representing theChemical�Pigment and Chemical�Other segments of Kerr-McGee, using the historical results of operations, and historical basis of assets andliabilities of the subsidiaries that the company does not presently own but will own and the chemical business the company will operate aftercompletion of the transfer from Kerr-McGee and this offering. Certain of the subsidiaries that will be transferred to the company by Kerr-McGee have in the past, directly or through predecessor entities, owned and operated businesses that are unrelated to the chemical business wewill operate after the closing of this offering. Certain of these businesses, including the company's former forest products operations, thoriummanufacturing, uranium and oil and gas refining, distribution and marketing, have been reflected as discontinued operations in the combinedfinancial statements. The discontinued operations have been included in the combined financial statements because certain contingentobligations directly related to such operations have been retained, resulting in charges to operations in periods subsequent to the exit fromthese businesses and related liabilities associated with the exit from these businesses (see Notes 15 and 21).

Management believes the assumptions underlying the combined financial statements are reasonable. However, the combined financialstatements included herein may not necessarily reflect the company's results of operations, financial position and cash flows in the future orwhat its results of operations, financial position and cash flows would have been had the company been a stand-alone company during theperiods presented. Because a direct ownership relationship did not exist among all the various worldwide entities comprising the company,Kerr-McGee's net investment in the company is shown as owner's net investment in lieu of stockholders' equity in the combined financialstatements. Transactions between Tronox and other Kerr-McGee operations have been identified in the Combined Statement ofComprehensive Income (Loss) and Business Equity as net transfers (to) from Kerr-McGee (see Note 3).

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2. Significant Accounting Policies

Basis of Combination

The combined financial statements include the accounts of all majority-owned subsidiary companies of Kerr-McGee discussed aboveunder Note 1 and in circumstances where the company owns an undivided interest, the company recognizes its pro rata share of assets and itsproportionate share of liabilities. Investments in affiliated companies that are 20% to 50% owned are carried as a component of long-termreceivables, investments and other assets in the Combined Balance Sheet at cost adjusted for equity in undistributed earnings. Except fordividends and changes in ownership interest, changes in equity in undistributed earnings are included in other income (expense) in theCombined Statement of Operations. All material intercompany transactions have been eliminated.

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to makeestimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the dateof the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differmaterially from those estimates as additional information becomes known.

Foreign Currency Translation

The U.S. dollar is considered the functional currency for the company's international operations, except for its European operations.Foreign currency transaction gains or losses are recognized in the period incurred and are included in other income (expense) in the CombinedStatement of Operations. The company recorded net foreign currency transaction gains (losses) of $(5.4) million, $(3.7) million and$6.4 million in 2004, 2003 and 2002, respectively.

The euro is the functional currency for the company's European operations. Translation adjustments resulting from translating thefunctional currency financial statements into U.S. dollar equivalents are reflected as a separate component of other comprehensive income (seeNote 4).

Cash Equivalents

The company considers all investments with maturity of three months or less to be cash equivalents. Cash equivalents totaling$2.3 million in 2004 and $25.3 million in 2003 were comprised of time deposits.

Accounts Receivable and Receivable Sales

Accounts receivable are reflected at their net realizable value, reduced by an allowance for doubtful accounts to allow for expected creditlosses. The allowance is estimated by management, based on factors such as age of the related receivables and historical experience, givingconsideration to customer profiles. The company does not generally charge interest on accounts receivable; however, certain operatingagreements have provisions for interest and penalties that may be invoked, if deemed necessary. Accounts receivable are aged in accordancewith contract terms and are written off when deemed uncollectible. Any subsequent recoveries of amounts written off are credited to theallowance for doubtful accounts.

Under an accounts receivable monetization program maintained by the company through April 2005, selected pigment customers'accounts receivable were sold to a special-purpose entity

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(SPE). The company did not own any of the common stock of the SPE. When the receivables were sold, the company retained an interest inexcess receivables that served as over-collateralization for the program and retained interests for servicing and in preference stock of the SPE.The interest in the preference stock was essentially a deposit to provide further credit enhancement to the securitization program, if needed,but otherwise was recoverable by the company at the end of the program. Management believes the servicing fee represented adequatecompensation and was equal to what would otherwise be charged by an outside servicing agent. The loss associated with the receivable saleswas determined as the difference in the book value of receivables sold and the total of cash and fair value of the deposit retained by the SPE.The losses were recorded in other income (expense). The estimate of fair value of the retained interests was based on the present value offuture cash flows discounted at rates estimated by management to be commensurate with the risks. As discussed more fully in Note 6, thisprogram was terminated in April 2005.

Inventories

Inventories are stated at the lower of cost or market. The costs of the company's product inventories are determined by the first-in, first-out (FIFO) method. Inventory carrying values include material costs, labor and associated indirect manufacturing expenses. Costs formaterials and supplies, excluding ore, are determined by average cost to acquire. Raw materials (ore) are carried at actual cost.

Property, Plant and Equipment

Property, plant and equipment is stated at cost less reserves for depreciation and amortization. Maintenance and repairs are expensed asincurred, except that costs of replacements or renewals that improve or extend the lives of existing properties are capitalized.

Depreciation�Property, plant and equipment is depreciated over its estimated useful life by the straight-line method. Useful lives forproperty, plant and equipment are as follows:

Vessel linings, general mechanical and process equipment 3 - 10 yearsElectrical equipment, process piping and waste treatment ponds 10 - 15 yearsSupport structures and process tanks 20 yearsElectrical distribution systems, mining equipment and otherinfrastructure assets

25 years

Buildings 10 - 40 years

Retirements and Sales�The cost and related depreciation reserves are removed from the respective accounts upon retirement or sale ofproperty, plant and equipment. Upon retirement, any resulting loss is included in costs of goods sold in the Combined Statement of Operationsand upon sale, the resulting gain or loss is included in other income (expense) in the Combined Statement of Operations.

Interest Capitalized�The company capitalizes interest costs on major projects that require an extended period of time to complete.Interest capitalized in 2004, 2003 and 2002 was $2.0 million, $1.6 million and $4.0 million, respectively.

Asset Impairments

The company evaluates impairments by asset group for which the lowest level of independent cash flows can be identified. If the sum ofthese estimated future cash flows (undiscounted and without

F-9



interest charges) is less than the carrying amount of the asset, an impairment loss is recognized for the excess of the carrying amount of theasset over its estimated fair value.

Gain or Loss on Assets Held for Sale

Assets are classified as held for sale when the company commits to a plan to sell the assets, the sale is probable and is expected to becompleted within one year. Upon transfer to the held-for-sale category, long-lived assets are no longer depreciated. A loss is recognized at thetime of transfer, and subsequently thereafter, based on the difference between fair value less costs to sell and the assets' carrying value. Lossesmay be reversed up to the original carrying value as estimates are revised; however, any gains above the assets' original carrying value areonly recognized upon disposition.

Goodwill and Other Intangible Assets

Goodwill is initially measured as the excess of the purchase price of an acquired entity over the fair value of individual assets acquiredand liabilities assumed. Goodwill and other indefinite-lived intangibles are not amortized but are reviewed annually for impairment, or morefrequently if impairment indicators arise. The annual test for goodwill impairment is completed at June 30. Based upon the most recent test, noimpairment was indicated.

Derivative Instruments and Hedging Activities

From time to time, the company enters into foreign currency forward contracts to hedge a portion of its foreign currency risk associatedwith pigment sales, raw material purchases and operating costs. The company also uses natural gas swaps to hedge a portion of its commodityprice risk arising from natural gas consumption. All derivative instruments are accounted for in accordance with FASB Statement No. 133,"Accounting for Derivative Instruments and Hedging Activities" (FAS No. 133), as amended. Derivative instruments are recorded in prepaidand other assets or accrued liabilities in the Combined Balance Sheet, measured at fair value. When available, quoted market prices are used indetermining fair value; however, if quoted market prices are not available, the company estimates fair value using either quoted market pricesof financial instruments with similar characteristics or other valuation techniques. For contracts that qualify and are designated as cash flowhedges of forecasted transactions under the provisions of FAS No. 133, unrealized gains and losses are initially reflected in accumulated othercomprehensive income and recognized in earnings in the periods during which the hedged forecasted transactions affect earnings (i.e., whenthe hedged forecasted pigment sales occur or operating costs are incurred, and upon the sale of finished inventory in the case of a hedged rawmaterial purchase). The ineffective portion of the change in fair value of such hedges, if any, is included in current earnings. For derivativesnot designated for hedge accounting, gains and losses are recognized in earnings in the periods incurred. Cash flows associated with derivativeinstruments are included in the same category in the Combined Statement of Cash Flows as the cash flows from the item being hedged.

Environmental Remediation and Other Contingencies

As sites of environmental concern are identified, the company assesses the existing conditions, claims and assertions, and records anestimated undiscounted liability when environmental assessments and/or remedial efforts are probable and the associated costs can bereasonably estimated. Estimates of environmental liabilities, which include the cost of investigation and remediation, are based on a variety ofmatters, including, but not limited to, the stage of investigation, the stage of the remedial design, evaluation of existing remediationtechnologies, and presently enacted laws and regulations. In future

F-10



periods, a number of factors could significantly change the company's estimate of environmental remediation costs, such as changes in lawsand regulations, or changes in their interpretation or administration, revisions to the remedial design, unanticipated construction problems,identification of additional areas or volumes of contaminated soils and groundwater, and changes in costs of labor, equipment and technology.

To the extent costs of investigation and remediation have been incurred and are recoverable from the U.S. government under Title X ofthe Energy Policy Act of 1992 and have been incurred or are recoverable under certain insurance policies and such recoveries are deemedprobable, the company records a receivable for the estimated amounts recoverable (undiscounted). Receivables are reflected in the CombinedBalance Sheet as either accounts receivable or as a component of long-term receivables, investments and other assets, depending on estimatedtiming of collection.

Asset Retirement Obligations

In June 2001, the FASB issued Statement No. 143, "Accounting for Asset Retirement Obligations" (FAS No. 143). FAS No. 143 requiresthat an asset retirement obligation (ARO) associated with the retirement of a tangible long-lived asset be recognized as a liability in the periodin which it is incurred or becomes determinable (as defined by the standard), with an associated increase in the carrying amount of the relatedlong-lived asset. The cost of the tangible asset, including the asset retirement cost, is depreciated over the useful life of the asset. The companyadopted the new standard on January 1, 2003, as discussed further in Note 17.

Generally, the company does not recognize an asset retirement obligation associated with its operating facilities either because no legalobligation exists or the life of such facilities is indeterminate. However, if a decision to decommission a facility is made and the timing ofliability settlement becomes known, a liability is recognized and the remaining asset retirement cost is depreciated over the remaining usefullife of the assets. The ARO is recorded at its estimated fair value and accretion expense is recognized over time as the discounted liability isaccreted to its expected settlement value. Fair value is measured using expected future cash outflows discounted at Kerr-McGee's credit-adjusted risk-free interest rate. No market risk premium has been included in the company's calculation of ARO balances since no reliableestimate can be made by the company.

Research and Development

Research and development costs were $6.3 million, $8.0 million and $7.5 million in 2004, 2003 and 2002, respectively, and wereexpensed as incurred.

Employee Stock-Based Compensation

Certain of company's employees participated in Kerr-McGee's long-term incentive plans. Under the plans, employees received variousstock-based compensation awards, including stock options, restricted stock, stock opportunity grants and performance units. The companyaccounts for such awards under the intrinsic-value method of Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued toEmployees" (APB No. 25). This method of accounting for stock options generally results in no expense being recognized for fixed-price stockoptions with an exercise price equal to the fair value of the stock on the grant date. Compensation expense for restricted stock and stockopportunity grants was measured at the market price of the shares of Kerr-McGee stock on the grant date and amortized ratably over the three-year vesting period of the underlying grants or over the service period, if shorter.

F-11



FAS No. 123, "Accounting for Stock-Based Compensation," (FAS No. 123) prescribes a fair-value method of accounting for employeestock-based awards. Following this method, compensation expense for such awards is measured based on the estimated grant-date fair valueand recognized as the related employee services are provided. If compensation expense for stock-based awards had been determined using thefair-value based method, both stock-based compensation expense and net loss would have increased, as shown in the following table.

2004 2003 2002


Net loss as reported $ (127.6) $ (92.7) $ (97.3)Add: stock-based employee compensation expense included in reported net loss, net oftaxes

1.5 0.8 �

Deduct: stock-based employee compensation expense determined using a fair-valuemethod, net of taxes

(3.6) (3.4) (3.1)

Pro forma net loss $ (129.7) $ (95.3) $ (100.4)

Pro forma basic and diluted loss per common share (unaudited):As reported (5.57)Pro forma (5.67)

The fair value of each Kerr-McGee option granted in 2004, 2003 and 2002 was estimated as of the date of the grant using the Black-Scholes option-pricing model with the following weighted-average assumptions:

2004 2003 2002

Risk-free interest rate 3.5% 3.6% 4.8%Expected dividend yield 3.6% 3.3% 3.4%Expected volatility 22.6% 32.7% 36.0%Expected life (years) 5.8 5.8 5.8Weighted-average fair value of options granted $ 8.63 $ 11.09 $ 16.97

Revenue Recognition

Revenue is recognized when persuasive evidence of a sales arrangement exists, delivery has occurred, sales price is fixed or determinableand collectibility is reasonably assured. All amounts billed to a customer in a sales transaction related to shipping and handling representrevenues earned and are reported as net sales. Costs incurred by the company for shipping and handling are reported as cost of goods sold.

Cost of Goods Sold

Cost of goods sold include the costs of manufacturing and distributing products, including raw materials, energy, labor, depreciation andother production costs. Receiving, distribution, freight and warehousing costs are also included in cost of goods sold.

Selling, General and Administrative Expenses

Selling, general and administrative expenses include costs related to marketing, sales, research and development, legal and administrativefunctions such as accounting, treasury and finance, as well as costs for salaries and benefits, travel and entertainment, promotional materialsand professional fees.

F-12



Income Taxes

The company is a member included in the consolidated tax return of Kerr-McGee. The company has not historically been a party to a tax-sharing agreement with Kerr-McGee but has consistently followed an allocation policy whereby Kerr-McGee has allocated its members of theconsolidated return provisions and/or benefits based upon each member's taxable income or loss. This allocation methodology results in therecognition of deferred assets and liabilities for the differences between the financial statement carrying amounts and their respective taxbasis, except to the extent for deferred taxes on income considered to be permanently reinvested in foreign jurisdictions. Deferred tax assetsand liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences areexpected to be recovered or settled. Kerr-McGee has allocated current tax benefits to the members of its consolidated return, including thecompany, that have generated losses that are utilized or expected to be utilized on the consolidated return. This allocation methodology is notconsistent with that calculated on a stand-alone tax return basis. In addition, Kerr-McGee manages its tax position for the benefit of its entireportfolio of businesses, and its tax strategies are not necessarily reflective of those tax strategies that the company would have followed as astand-alone company.

Pro Forma Loss Per Share (Unaudited)

Prior to the effective date of this offering, the company will amend its certificate of incorporation to authorize shares of Class A andClass B common stock. After a conversion of existing common stock into Class B common stock, Kerr-McGee will hold approximately22.9 million shares of Class B common stock. The company has presented pro forma basic and diluted loss per share amounts for the yearended December 31, 2004 as if this recapitalization had occurred on January 1, 2004. The company calculated its pro forma loss per share inaccordance with SFAS No. 128 "Earnings per Share." Basic loss per shares is computed based on the weighted-average number of commonshares outstanding during the period. There is no difference between basic and diluted loss per share in 2004, since there were no options topurchase shares of Tronox common stock or other potentially dilutive securities outstanding prior to the offering and due to the net loss. Inconnection with the offering, certain employees will be awarded stock option grants and restricted stock awards to purchase shares of Tronoxor other equity-based awards.

New/Revised Accounting Standards

In November 2004, the FASB issued FAS No. 151, "Inventory Costs�an Amendment of ARB No. 43, Chapter 4," which requires thatabnormal amounts of idle facilities cost, freight, handling costs and spoilage be expensed as incurred and not capitalized as inventory. FASNo. 151 is effective for inventory costs incurred during fiscal years beginning after June 15, 2005. The company will adopt the standardeffective January 1, 2006. The effect of adoption is not expected to have a material effect on the company's financial position or results ofoperations.

In December 2004, the FASB issued FASB Staff Position No. FAS 109-2 (FSP No. 109-2), "Accounting and Disclosure Guidance for theForeign Earnings Repatriation Provisions within the American Jobs Creation Act of 2004" (the Jobs Act). FSP No. 109-2 provides guidancewith respect to reporting the potential impact of the repatriation provisions of the Jobs Act on an enterprise's income tax expense and deferredtax liability. The Jobs Act was enacted on October 22, 2004, and provides for a temporary 85% dividends received deduction on certainforeign earnings repatriated during a one-year period. The deduction would result in an approximate 5.25% federal tax rate on the

F-13



repatriated earnings. Additionally, withholding taxes may be due in certain tax jurisdictions. To qualify for the deduction, the earnings must bereinvested in the United States pursuant to a domestic reinvestment plan established by a company's chief executive officer and approved by acompany's board of directors. Certain other criteria in the Jobs Act must be satisfied as well. FSP No. 109-2 states that an enterprise is allowedtime beyond the financial reporting period to evaluate the effect of the Jobs Act on its plan for reinvestment or repatriation of foreign earnings.The status of the company's evaluation of the repatriation provisions of the Jobs Act and related financial statement effects are disclosed inNote 16.

In December 2004, the FASB issued Statement No. 123 (revised 2004), "Share-Based Payment" (FAS No. 123R), which replaces FASNo. 123 and supersedes APB No. 25. FAS No. 123R requires all share-based payments to employees, including grants of employee stockoptions, to be recognized in the financial statements based on their fair values beginning with the first interim period after June 15, 2005, withearly adoption encouraged. In April 2005, the Securities and Exchange Commission (the "SEC") amended its rule to allow public companiesmore time to implement the standard. Following the SEC's rule, the company intends to implement FAS No. 123R effective January 1, 2006.The pro forma disclosures previously permitted under FAS No. 123 no longer will be an alternative to financial statement recognition. UnderFAS No. 123R, the company must determine the appropriate fair value model to be used for valuing share-based payments, the amortizationmethod for compensation cost and the transition method to be used at the date of adoption. The company plans to adopt the standard using themodified prospective method, as permitted by the standard. The modified prospective method requires that compensation expense be recordedfor all unvested share-based compensation awards at the beginning of the first quarter of adoption. The company expects that the adoption willnot have a material effect on its financial condition and cash flows. The company is evaluating the effect of adoption on its results ofoperations, which will depend, in part, on the types and quantities of stock-based awards the company will issue to its employees under thenew long term incentive plan the company intends to establish upon the completion of the offering.

In March 2005, the FASB issued FASB Interpretation No. 47, "Accounting for Conditional Asset Retirement Obligations" (FIN No. 47)to clarify that an entity must recognize a liability for the fair value of a conditional asset retirement obligation when incurred, if the liability'sfair value can be reasonably estimated. Conditional asset retirement obligations under this pronouncement are legal obligations to performasset retirement activities when the timing and/or method of settlement are conditional on a future event or may not be within the control ofthe entity. FIN No. 47 also provides additional guidance for evaluating whether sufficient information to reasonably estimate the fair value ofan asset retirement obligation is available. FIN No. 47 is effective for the company as of December 31, 2005. The company does not expectimplementation of this pronouncement to have a material effect on its financial statements, unless additional information enabling thecompany to estimate the fair value of its conditional asset retirement obligations becomes available in future periods.

In May 2005, FASB issued FAS No. 154, "Accounting Changes and Error Corrections" (FAS No. 154), which will require that, unless itis impracticable to do so, a change in an accounting principle be applied retrospectively to prior periods' financial statements for all voluntarychanges in accounting principles and upon adoption of a new accounting standard if the standard does not include specific transitionprovisions. FAS No. 154 supersedes Accounting Principles Board Opinion No. 20, Accounting Changes (APB No. 20), which previouslyrequired that most voluntary changes in accounting principles be recognized by including in the current period's net income (loss) thecumulative effect of changing to the new accounting principle. FAS No. 154 also provides that if an entity changes its

F-14



method of depreciation, amortization, or depletion for long-lived, nonfinancial assets, the change must be accounted for as a change inaccounting estimate. Under APB No. 20, such a change would have been reported as a change in an accounting principle. FAS No. 154 will beapplicable to accounting changes and error corrections made by the company starting in 2006. The effect of applying this new standard on thecompany will depend upon whether material voluntary changes in accounting principles, changes in estimates or error corrections occur andtransition and other provisions included in new accounting standards.

3. Transactions with Kerr-McGee

Prior to the Distribution, Tronox Incorporated expects to enter into agreements with Kerr-McGee in connection with its separation fromKerr-McGee and related matters. These agreements are expected to include:

�� A master separation agreement, providing for, among other things, the separation from Kerr-McGee and the Distribution ofshares following the initial offering, and agreements between Tronox Incorporated and Kerr-McGee, including those relatingto indemnification;

�� A tax sharing agreement, providing for, among other things, the allocation between Tronox and Kerr-McGee of federal, state,local and foreign tax liabilities for periods prior to the Distribution and in some instances for periods after the Distribution;

�� An employee benefits agreement, pursuant to which, among other things, some employee-related assets and liabilities ofTronox will be allocated between Tronox and Kerr-McGee and some arrangements will be made with respect to employeebenefit plans and compensation arrangements;

�� A transition services agreement, pursuant to which, among other things, Kerr-McGee will provide certain services to Tronoxfor a transition period following the Distribution.

The Combined Statement of Operations includes allocation of costs for certain corporate functions historically provided by Kerr-McGee,including:

General Corporate Expenses�Represents costs related to corporate functions such as accounting, tax, treasury, human resources, legaland information management and technology. These costs have historically been allocated primarily based on estimated use of services ascompared to Kerr-McGee's other businesses. These costs are included in selling, general and administrative expenses in the CombinedStatement of Operations.

Employee Benefits and Incentives�Represents fringe benefit costs and other incentives, including group health and welfare benefits,U.S. pension plans, U.S. postretirement benefit plans and stock-based compensation plans. These costs have historically been allocated on anactive headcount basis for health and welfare benefits, including postretirement benefits, on the basis of salary for U.S. pension plans and on aspecific identification basis for stock-based compensation plans. These costs are included in costs of goods sold, selling, general andadministrative expenses and restructuring charges in the Combined Statement of Operations.

Interest Expense�Kerr-McGee has provided financing to the company through cash flows from its other operations and debt incurred.Although the incurred debt has not been allocated to the company, a portion of the interest expense has been allocated based on specifically-identified borrowings from Kerr-McGee at Kerr-McGee's average borrowing rates. These costs are included in other income

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(expense) in the Combined Statement of Operations, net of interest income that has been allocated from the company to Kerr-McGee oncertain monies the company has loaned to Kerr-McGee.

Expense allocations from Kerr-McGee reflected in the loss from continuing operations in the company's Combined Statement ofOperations were as follows:

2004 2003 2002


General corporate expenses $ 27.4 $ 25.3 $ 20.7Employee benefits and incentives 28.8 35.9 7.6Interest expense, net 12.1 10.1 12.9

These allocations were based on what Kerr-McGee considered to be reasonable reflections of the historical utilization levels of theservices required in support of our business. The company's management currently estimates that general corporate expenses may be $20.0 to$25.0 million greater on an annual basis in the future as a stand-alone company (unaudited).

Kerr-McGee utilizes a worldwide centralized approach to cash management and the financing of its operations with all related activitybetween Kerr-McGee and the company reflected as net transfers from (to) Kerr-McGee in the company's Combined Statement ofComprehensive Income (Loss) and Business Equity. In connection with our separation from Kerr-McGee, the net amount due from thecompany to Kerr-McGee at the closing date of this offering, will be contributed by Kerr-McGee to the company, forming a part of thecontinuing equity of the company. Subsequent to the closing of this offering, amounts due from or to Kerr-McGee arising from transactionssubsequent to that date will be settled in cash. We intend to distribute all of the net proceeds from this offering to Kerr-McGee.

Kerr-McGee issued $1.5 billion of long-term notes in a public offering in 2001, $350 million of long-term notes in 2002, and$650 million of long-term notes in 2004. These notes have been fully and unconditionally guaranteed, on a joint and several basis, by TronoxWorldwide LLC (formerly Kerr-McGee Chemical Worldwide LLC) and another Kerr-McGee subsidiary. The $350 million notes issued in2002 matured in April 2005 and were repaid by Kerr-McGee at that time. See Note 24 for additional information with respect to TronoxWorldwide LLC's guarantee of Kerr-McGee's notes.

4. Other Comprehensive Income

Components of other comprehensive income for the years ended December 31, 2004, 2003 and 2002 were as follows:

2004 2003 2002


Foreign currency translation adjustments $ 20.0 $ 50.8 $ 42.7Unrealized gain on cash flow hedges, net of taxes of $(0.8), $(4.7) and $(3.0) 0.6 13.8 7.0Reclassification of realized (gain) loss on cash flow hedges to net loss, net of taxes of $2.8, $3.1 and$(1.7)

(7.7) (7.2) 3.9

Minimum pension liability adjustments, net of taxes of $3.6, $0.1 and nil (6.1) (0.6) �

$ 6.8 $ 56.8 $ 53.6

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Components of accumulated other comprehensive income at December 31, 2004 and 2003, net of applicable tax effects, were as follows:

2004 2003


Foreign currency translation adjustments $ 79.2 $ 59.2Unrealized gain (loss) on cash flow hedges (1.2) 5.9Minimum pension liability adjustments (6.7) (0.6)

$ 71.3 $ 64.5

5. Cash Flow Information

Net cash provided by operating activities reflects cash payments for income taxes as follows:

2004 2003 2002


Income tax payments $ 8.0 $ 10.4 $ 5.9Less refunds received (0.2) (0.5) (10.1)

Net income tax payments (refunds) $ 7.8 $ 9.9 $ (4.2)

Additionally, in 2004 Kerr-McGee paid income taxes of $37.0 million on the company's behalf.

Other noncash items included in the reconciliation of net loss to net cash provided by operating activities include the following:

2004 2003 2002


Stock-based compensation(1) $ 2.5 $ 1.2 $ �

Pension and postretirement cost (benefit)(1) 15.5 24.0 (8.5)Litigation provision 0.2 1.3 69.1Loss on retirements of property and equipment 9.7 5.9 4.6Equity in net (earnings) losses of equity method investees (2.4) (0.8) (0.5)All other(2) 6.4 (2.6) 2.0

Total $ 31.9 $ 29.0 $ 66.7

(1)Amounts consist principally of cost allocations from Kerr-McGee.

(2)No other individual item is material to total cash flows from operating activities.

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Details of changes in other assets and liabilities within the operating section of the Combined Statement of Cash Flows are as follows:

2004 2003 2002


Environmental expenditures $ (85.2) $ (97.9) $ (121.1)Reimbursements of environmental expenditures 50.5 14.8 �

Cash abandonment expenditures (3.2) � �

Employer contributions to pension and postretirement plans (1.9) (0.8) (1.0)All other(1) (2.4) (7.9) 1.6

Total $ (42.2) $ (91.8) $ (120.5)

(1)No other individual item is material to total cash flows from operating activities.

In addition to transactions with Kerr-McGee affecting the company's net loss, the company periodically has had other transactions withKerr-McGee that have not affected net loss but have affected recognized assets and liabilities and owner's net investment. Such noncash itemsare excluded from operating and financing activities in the accompanying Combined Statement of Cash Flows.

6. Accounts Receivable

Summarized below are accounts receivable, net of the related allowance for doubtful accounts, at December 31, 2004 and 2003:

2004 2003


Accounts receivableAccounts receivable�trade $ 153.4 $ 106.9Receivable from the U.S. Department of Energy (Note 21)(1) 66.0 44.5Receivable from insurers (Note 21)(1) 6.0 �

Other 7.8 8.4

233.2 159.8Allowance for doubtful accounts (11.0) (9.0)

Total $ 222.2 $ 150.8

(1)Amounts receivable from insurers and the U.S. Department of Energy not expected to be collected within one year from the balancesheet date are reflected in long-term receivables, investments and other assets.

Through April 2005, the company had an accounts receivable monetization program that began in December 2000, through the sale ofselected accounts receivable with a three-year, credit-insurance-backed asset securitization program with a maximum availability of$165.0 million. On July 30, 2003, the company restructured the program to include the sale of receivables originated by the company'sEuropean operations. Under the terms of the program, selected qualifying customer accounts receivable were sold monthly to a special-purpose entity (SPE), which in turn sold an undivided ownership interest in the receivables to a third-party multi-seller commercial paperconduit sponsored

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by an independent financial institution. The company sold, and retained an interest in, excess receivables to the SPE as over-collateralizationfor the program. The company's retained interest in the SPE's receivables is classified in trade accounts receivable in the accompanyingCombined Balance Sheet. The retained interest was subordinate to, and provided credit enhancement for, the conduit's ownership interest inthe SPE's receivables, and was available to the conduit to pay certain fees or expenses due to the conduit, and to absorb credit losses incurredon any of the SPE's receivables in the event of termination. However, the company believed that the risk of credit loss was very low since itsbad-debt experience has historically been insignificant. The company retained servicing responsibilities and received a servicing fee of 1.07%of the receivables sold for the period of time outstanding, generally 60 to 120 days. No recourse obligations were recorded since the companyhad no obligations for any recourse actions on the sold receivables. The company also holds preference stock in the SPE, which essentiallyrepresents a retained deposit to provide further credit enhancements, if needed, but is otherwise recoverable by the company. The carryingvalue of our investment in the preference stock was $4.0 million at both December 31, 2004 and 2003 and is expected to be recovered upondissolution of the SPE later in 2005.

During 2004, 2003 and 2002, the company sold $1.1 billion, $836.2 million and $609.4 million, respectively, of its pigment receivables,resulting in pretax losses reflected in other income (expense) of $8.2 million, $4.8 million and $4.7 million, respectively. The losses wereequal to the difference in the book value of the receivables sold and the total of cash and the fair value of the deposit retained by the SPE. Atyear-end 2004 and 2003, the outstanding balance on receivables sold, net of the company's retained interest in receivables serving as over-collateralization, totaled $165.0 million and $164.7 million, respectively. The outstanding balance of receivables serving as over-collateralization totaled $38.8 million and $36.4 million at December 31, 2004 and 2003, respectively. There were no delinquencies as ofyear-end 2004.

The accounts receivable monetization program included ratings downgrade triggers based on Kerr-McGee's corporate senior unsecureddebt rating that provided for certain program modifications, including a program termination event upon which the program would effectivelyliquidate over time and the third-party multi-seller commercial paper conduit would be repaid with the collections on accounts receivable soldby the SPE. In April 2005, Kerr-McGee's corporate senior unsecured debt was downgraded, triggering program termination. As opposed toliquidating the program over time in accordance with its terms, Kerr-McGee entered into an agreement to terminate the program byrepurchasing the then outstanding balance of receivables sold of $165.0 million, which were then contributed to the company. The balances ofoutstanding receivables are being collected by the company as they become due.

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7. Inventories

Major categories of inventories at December 31, 2004 and 2003 were:

2004 2003


Raw materials $ 79.5 $ 104.1Work in progress 13.4 10.2Finished goods 135.6 184.6Materials and supplies 56.6 53.7

Total $ 285.1 $ 352.6

8. Financial Instruments

The company holds or issues financial instruments for other than trading purposes, including the following at December 31, 2004 and2003: cash and cash equivalents, accounts receivable, accounts payable, accrued liabilities, long-term receivables and foreign currency andnatural gas derivatives. At December 31, 2004 and 2003, the carrying amounts of all financial instruments, as reflected in the CombinedBalance Sheet, approximated their estimated fair values due to the nature or short maturities of such items.

Concentration of Credit Risk

A significant portion of our liquidity is concentrated in trade accounts receivable that arise from sales of titanium dioxide pigment tocustomers in the paint and coatings industry. The industry concentration has the potential to impact our overall exposure to credit risk, eitherpositively or negatively, in that our customers may be similarly affected by changes in economic, industry or other conditions. We performongoing credit evaluations of our customers and generally do not require collateral. We maintain reserves for potential credit losses based onhistorical experience and such losses have been within our expectations.

9. Property, Plant and Equipment

Property, plant and equipment at December 31, 2004 and 2003, was as follows:

2004 2003


Land $ 58.4 $ 57.0Buildings 146.9 148.2Machinery and equipment 1,770.8 1,718.5Other 96.3 96.7

Total 2,072.4 2,020.4Less accumulated depreciation (1,189.4) (1,058.8)

Net $ 883.0 $ 961.6

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10. Long-Term Receivables, Investments and Other Assets

Long-term receivables, investments and other assets were as follows at December 31, 2004 and 2003:

2004 2003


Receivable from the U.S. Department of Energy (Note 21) $ 12.8 $ 64.6Investments in equity method investees 16.8 14.9Receivables from insurers and suppliers (Note 21) 9.0 24.5Prepaid pension cost � 8.0Other 9.7 14.6

Total $ 48.3 $ 126.6

11. Goodwill and Other Intangible Assets

The changes in the carrying value of goodwill, all of which is associated with the company's pigment reportable segment, for 2003 and2004 were as follows:

Carrying Value


Balance at December 31, 2002 $ 9.1Change due to foreign currency translation 1.8

Balance at December 31, 2003 10.9Change due to foreign currency translation 0.9

Balance at December 31, 2004 $ 11.8

The changes in the carrying value of indefinite-lived intangible assets for 2003 and 2004 were as follows:

Carrying

Value

(Millions of

dollars)

Proprietary TechnologyBalance at December 31, 2002 $ 52.3

Change due to foreign currency translation 3.2

Balance at December 31, 2003 55.5Impairment associated with the Savannah sulfate plant shutdown(1) (7.4)Change due to foreign currency translation 5.0

Balance at December 31, 2004 $ 53.1



(1)Refer to Note 15 for more information regarding the Savannah sulfate plant shutdown.

The net carrying amount of intangible assets subject to amortization at both December 31, 2004 and 2003 was $0.2 million.

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12. Derivative Instruments

At December 31, 2004 and 2003, the net fair value of foreign currency and commodity hedging contracts included in the CombinedBalance Sheet was a liability of $1.6 million and an asset of $7.4 million, respectively, and the related balance of deferred after-tax gains(losses) in accumulated other comprehensive income was $(1.2) million and $5.9 million, respectively. All contracts outstanding atDecember 31, 2004 are expected to settle in 2005. In 2004, 2003 and 2002, pre-tax gains (losses) on cash flow hedges of $10.5 million,$10.4 million and $(5.6) million, respectively, were reclassified from accumulated other comprehensive income to earnings. Substantially allof such gains (losses) are reflected as a component of cost of goods sold in the Combined Statement of Operations. No hedges werediscontinued and no ineffectiveness was recognized in the periods presented.

13. Accrued Liabilities

Accrued liabilities at December 31, 2004 and 2003 were as follows:

2004 2003


Employee-related costs and benefits $ 43.5 $ 34.7Reserves for environmental remediation and restoration�current portion 85.0 83.7Other(1) 34.8 33.4

Total $ 163.3 $ 151.8

(1)No other individual item is material to total current liabilities.

14. Noncurrent Liabilities��Other

Noncurrent liabilities�other consisted of the following at December 31, 2004 and 2003:

2004 2003


Income taxes payable $ 45.3 $ 30.8Asset retirement obligations 24.3 17.3Workers' compensation and general liability insurance 16.1 14.0Pension obligations 13.5 21.6Other 15.5 15.7

Total $ 114.7 $ 99.4

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15. Discontinued Operations, Restructuring and Exit Activities

Restructuring and Exit Activities�The following table presents a reconciliation of the beginning and ending balances of reserves forrestructuring and exit activities for 2004 and 2003, with discussion of material components of the activity provided below.

2004 2003

Personnel

Costs

Dismantlement

and

Closure

Total(1)(2) Personnel

Costs

Dismantlement

and

Closure

Total(1)(2)


Beginning balance $ 16.3 $ 12.6 $ 28.9 $ 3.8 $ 22.8 $ 26.6Provisions 4.2 2.8 7.0 25.8 0.6 26.4Payments (12.5) (6.4) (18.9) (14.8) (5.6) (20.4)Adjustments (0.9) 1.4 0.5 1.5 (5.2) (3.7)

Ending balance $ 7.1 $ 10.4 $ 17.5 $ 16.3 $ 12.6 $ 28.9

(1)Amounts exclude asset retirement obligations and pension reserves.

(2)Amounts include obligations of the discontinued forest products operations that have been retained by the company.

In 2004, the company shutdown sulfate and gypsum production at the Savannah, Georgia facility, wrote down assets that were no longerin service and recognized a pretax charge of $123.0 million. Of the total charge in 2004, $86.6 million represented a write-down of plantassets (of which $12.7 million related to an asset retirement obligation recognized during the third quarter of 2004), $15.6 million forinventory revaluation, $7.4 million for impairment of intangible assets, $6.7 million for severance and benefit plan curtailment costs, and$6.7 million for other closure costs. Severance cost of $2.1 million was paid during 2004 and $2.1 million remained in the reserve at the endof the year. The shutdown resulted in the elimination of approximately 100 positions. The company's 2004 Combined Statement of Operationsincludes $15.6 million in cost of goods sold and $107.4 million in restructuring charges, for total pretax charges of $123.0 million associatedwith the Savannah facility. (See Note 17 for additional discussion regarding the asset retirement obligation.)

The company began production through a new high-productivity oxidation line at its Savannah, Georgia, chloride process pigment plantin January 2004. This new technology results in low-cost, incremental capacity increases through modification of existing chloride oxidationlines and allows for improved operating efficiencies through simplification of hardware configurations and reduced maintenancerequirements. The company continues to evaluate the performance of this new oxidation line and expects to determine how the Savannah sitemight be reconfigured to exploit its capabilities in 2005. The possible reconfiguration of the Savannah site, if any, could include redeploymentor idling of certain assets and reduction of their future useful lives resulting in the acceleration of depreciation expense and the recognition ofother charges.

In September 2003, the company implemented a workforce reduction program through which it reduced its U.S. non-bargaining workforce through both voluntary retirements and involuntary terminations. As a result of the program, the company's work force was reduced by138 employees. Qualifying employees terminated under this program were eligible for enhanced benefits under Kerr-McGee's pension andpostretirement plans, along with severance payments. In connection with the work force reduction program, the company incurred a pretaxcharge of $9.4 million for severance-

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related costs and $14.2 million for curtailment and special termination benefits associated with the company's participation in Kerr-McGee'sU.S. retirement plans. These charges are reflected in restructuring charges in the Combined Statement of Operations. Of the total severanceprovision, $2.6 million was paid in 2003, and $6.5 million was paid in 2004. The remaining reserve balance of $0.3 million, representing anexcess of estimated provisions over actual costs, was eliminated in 2004.

During 2003, the company provided $60.8 million pretax for costs associated with the closure of its synthetic rutile plant in Mobile,Alabama. Included in the $60.8 million were $14.1 million for the cumulative effect of change in accounting principle related to therecognition of an asset retirement obligation, $15.2 million for accelerated depreciation, $14.9 million for other closure costs, $10.5 millionfor severance benefits and $6.1 million for benefit plan curtailment costs. The company's 2003 Combined Statement of Operations includes$6.1 million in cost of goods sold, $0.5 million in selling, general and administrative expenses, $38.6 million in restructuring charges and$1.5 million in provision for environmental remediation and restoration, net of reimbursements. In 2004, $6.8 million was provided by thecompany for additional costs associated with the plant closure, of which $5.6 million was accelerated depreciation of additional assetretirement cost and is included in restructuring charges. See Note 17 for a discussion of the related asset retirement obligation. The reservebalance related to this plant closure was $2.0 million and $2.2 million at the end of 2004 and 2003, respectively. Approximately 127employees will ultimately be terminated in connection with this plant closure, of which 111 had been terminated as of December 31, 2004.Payments are expected to continue through the end of 2007.

During 2002, the company approved a plan to exit its forest products business, which was a component of the company's electrolytic andother chemical products segment. This decision was made as part of the company's strategic plan to focus on its core business. At the time ofthis decision, five plants were in operation. Four of these plants were closed and abandoned during 2003. The fifth plant, a leased facility, wasoperated throughout 2004 until the lease expired and the fixed assets at the facility were sold in January 2005. Criteria for classification ofthese assets as held for sale were met in 2004, at which time the results of forest products operations met the requirements for reporting asdiscontinued operations in the accompanying Combined Statements of Operations for all years presented. Therefore, the provisions for plantclosures discussed below are included in loss from discontinued operations. The assets held for sale at December 31, 2004 are stated in theCombined Balance Sheet at estimated sales price less costs to sell of $3.4 million. No gain or loss was recognized upon the disposition ofthese assets in 2005. Environmental liabilities associated with the forest products sites were retained by the company and are included in theCombined Balance Sheets in accrued liabilities and environmental remediation and/or restoration and other liabilities.

The company provided $1.9 million, $5.2 million and $16.5 million for costs associated with exiting its forest products business in 2004,2003 and 2002, respectively, for a total of $23.6 million over the three-year period. Of this amount, $17.0 million was provided fordismantlement and closure costs and $6.6 million for severance costs. Through December 31, 2004, $17.1 million was paid, with $6.5 millionremaining in the reserve at year-end. Payments related to the plant closures are expected to continue for several years in connection withdismantlement and cleanup efforts; however, all of the severance costs were paid by the end of March 2005. In connection with the plantclosures, approximately 235 employees were terminated of which 216 were terminated as of year-end 2004. In addition to the provisions forseverance, dismantlement and closure, the company recognized $8.8 million in 2003 and $8.1 million in 2004 for other costs associated withthe shutdown. The 2003 costs included accelerated

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depreciation on plant assets, curtailment costs and special termination benefits related to pension and postretirement plans, while 2004 costsrepresented operating costs during the shutdown period.

In 2001, the company provided $31.8 million related to the closure of a plant in Antwerp, Belgium. The provision consisted of$12.0 million for severance costs, $12.3 million for dismantlement costs, $6.7 million for contract settlement costs and $0.8 million for otherplant closure costs. Of this total accrual, $4.6 million and $4.9 million remained in the restructuring accrual at the end of 2004 and 2003,respectively. As a result of this plant closure, 121 employees have been terminated as of December 31, 2004. Payments related to severanceare expected to continue until early 2016. Payments related to other shutdown costs could extend into 2017.

Discontinued Operations�As discussed above, in 2004 the company's forest product operations met the criteria for reporting asdiscontinued operations. Revenues applicable to discontinued forest products operations totaled $21.8 million, $105.0 million and$131.0 million and pretax losses totaled $15.7 million, $15.5 million and $104.8 million for the years 2004, 2003, and 2002, respectively.

In addition to the company's forest products operations, losses from discontinued operations for all periods presented include adjustmentsto amounts previously reported as discontinued operations upon disposition of the company's thorium manufacturing, uranium and refiningoperations. These adjustments resulted from changes in estimated cost of environmental remediation and restoration activities directly relatedto the disposed operations. Disposals of the company's uranium and refining operations were completed in 1989 and 1995, respectively. Thecompany ceased operations at its West Chicago thorium facility in 1973. The company retained certain environmental remediation obligationsand continues remediation activities directly related to these former operations, as more fully discussed in Note 21.

16. Income Taxes

The 2004, 2003 and 2002 income tax benefit (provision) from continuing operations are summarized below:

2004 2003 2002


U.S. Federal�Current $ 26.7 $ 32.0 $ 16.0Deferred 17.5 2.6 (12.4)

44.2 34.6 3.6

International�Current (13.8) (9.2) (8.4)Deferred 7.9 (10.2) (3.5)

(5.9) (19.4) (11.9)

State � (0.1) �

Total Benefit (Provision) $ 38.3 $ 15.1 $ (8.3)

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In the following table, the U.S. Federal income tax rate is reconciled to the company's effective tax rates for income or loss fromcontinuing operations as reflected in the Combined Statement of Operations.

2004 2003 2002

U.S. statutory rate�benefit 35.0% 35.0% 35.0%Increases (decreases) resulting from�

Adjustment of deferred tax balances due to tax rate changes 3.4 � �

Taxation of foreign operations (5.8) (7.8) (137.5)State income taxes � (0.1) 0.2Other�net (0.7) (3.1) (1.5)

Total 31.9% 24.0% (103.8)%

Net deferred tax liabilities at December 31, 2004 and 2003, were comprised of the following:

2004 2003


Deferred tax liabilities�Property, plant and equipment $ 156.4 $ 186.1Investments 5.9 55.2Notes and payables 20.0 19.3Intangible assets 9.1 11.7Other 0.1 9.8

Total deferred tax liabilities 191.5 282.1

Deferred tax assets�Net operating loss and other carryforwards (45.9) (46.7)Reserves for environmental remediation and restoration (48.1) (38.0)Obligations for pension and other employee benefits (3.9) (5.7)Bad debt allowance (5.3) (5.3)Inventory (3.7) (3.5)Other (7.4) (3.0)

(114.3) (102.2)Valuation allowance associated with loss carryforwards 6.1 5.0

Net deferred tax assets (108.2) (97.2)

Net deferred tax liability $ 83.3 $ 184.9

Taxation for a company with operations in several foreign countries involves many complex variables, such as tax structures that differfrom country to country and the effect on U.S. taxation of international earnings. These complexities do not permit meaningful comparisonsbetween the U.S. and international components of income before income taxes and the provision for income taxes, and

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disclosures of these components do not necessarily provide reliable indicators of relationships in future periods. Loss from continuingoperations before income taxes is comprised of the following:

2004 2003 2002


United States $ (130.2) $ (102.5) $ (10.4)International 10.1 39.7 2.4

Total $ (120.1) $ (62.8) $ (8.0)

At December 31, 2004, the company had foreign operating loss carryforwards totaling $204.6 million. Of this amount, $8.7 millionexpires in 2009, $29.5 million in 2011, and $166.4 million has no expiration date. Realization of these operating loss carryforwards dependson generating sufficient taxable income in future periods. A valuation allowance of $6.1 million has been recorded at December 31, 2004, toreduce deferred tax assets associated with loss carryforwards that the company does not expect to fully realize prior to expiration.

Kerr-McGee allocates tax benefit from U.S. net operating losses generated by its U.S. tax consolidated subsidiaries, including thecompany and company's U.S. subsidiaries, through intercompany accounts. Deferred tax assets related to U.S. consolidated net operatinglosses, including those of the company and the company's U.S. subsidiaries, are recorded on Kerr-McGee's balance sheet. Kerr-McGeebelieves that the company and the company's subsidiaries have been adequately compensated for all U.S. tax net operating losses sustained bythe company and the company's U.S. subsidiaries.

Undistributed earnings of certain combined foreign subsidiaries totaled $132.1 million at December 31, 2004. At December 31, 2004, noprovision for deferred U.S. income taxes had been made for these earnings because they were considered to be indefinitely invested outsidethe United States. As discussed below, the distribution of these earnings in the form of dividends or otherwise, may subject the company toU.S. income taxes and, possibly, foreign withholding taxes. However, because of the complexities of U.S. taxation of foreign earnings, it isnot practicable to estimate the amount of additional tax that might be payable on the eventual remittance of these earnings.

On October 22, 2004, the President of the United States signed into law the American Jobs Creation Act of 2004 (the "Act"). A provisionof the Act includes a one-time dividends received deduction of 85% of certain foreign earnings that are repatriated, as defined in the Act. Asof December 31, 2004, management had not decided on whether, and to what extent, foreign earnings may be repatriated under the Act, andaccordingly, the financial statements do not reflect any provision for taxes on unremitted foreign earnings. On April 11, 2005, managementcompleted its analysis of the impact of the Act on the company's plans for repatriation. Based on this analysis, the company repatriated$100.0 million in extraordinary dividends, as defined in the Act, in April 2005. Accordingly, a tax liability of approximately $5 million will berecognized in the quarter ending June 30, 2005. Cash requirements for the dividends were met with cash on hand at the time the distributionwas made.

The Internal Revenue Service has completed its examination of Kerr-McGee and subsidiaries' federal income tax returns for all yearsthrough 1998 and is conducting an examination of the years 1999 through 2002. The years through 1996 have been closed with the exceptionof issues for which a refund claim has been filed. Contingent tax liabilities of $45.3 million and $30.8 million at December 31, 2004 and 2003,respectively, have been included in noncurrent liabilities separate and

F-27



apart from deferred income taxes. It is not expected that these contingent amounts will be paid prior to the close of calendar year 2005. Thesecontingencies relate primarily to certain deductions associated with plant shutdown activities, deductions related to the effects of foreigncurrency translation and other tax-related matters. The company believes that it has made adequate provision for income taxes that may bepayable with respect to years open for examination.

Tax Sharing Agreement and Tax Allocations�The company intends to enter into a tax sharing agreement with Kerr-McGee that willgovern Kerr-McGee's and the company's respective rights, responsibilities and obligations after this offering with respect to taxes for taxperiods ending in 2005 and prior. Generally, taxes incurred or accrued prior to this offering that are attributable to the business of one partywill be borne solely by that party.

The company may incur certain restructuring taxes as a result of the Contribution and Distribution. The tax sharing agreement willaddress the allocation of liability for any restructuring taxes incurred as a result of the Contribution and Distribution. In addition, it is expectedthat the company will be required to indemnify Kerr-McGee for any tax liability incurred by reason of the Distribution being considered ataxable transaction to Kerr-McGee as a result of a breach of any of our representations, warranties or covenants contained in the tax sharingagreement.

Under U.S. federal income tax laws, the company and Kerr-McGee are jointly and severally liable for Kerr-McGee's federal incometaxes attributable to the periods prior to and including the taxable calendar year of Kerr-McGee, which includes the Distribution date. If Kerr-McGee fails to pay the taxes attributable to it under the Tax Sharing Agreement for periods prior to and including the current taxable year ofKerr-McGee, the company may be liable for any part of, including the whole amount of, these tax liabilities.

17. Asset Retirement Obligations

As a result of the adoption of FAS No. 143 on January 1, 2003, and the company's expressed intent to close the synthetic rutile plant inMobile, Alabama, the company recorded an abandonment liability of $17.6 million and an increase in net property of $3.5 million. The netresult was a pre-tax charge to earnings of $14.1 million to recognize the cumulative effect of adopting the new standard.

A summary of the changes in the abandonment liability during 2004 and 2003 is included in the table below.

2004 2003


Balance, January 1 $ 17.6 $ 17.6New obligations incurred 12.7 �

Accretion expense 0.2 �

Changes in estimates, including timing 3.6 �

Abandonment expenditures (3.2) �

Balance, December 31 $ 30.9 $ 17.6

Current portion(1) $ 6.6 $ 0.3

Noncurrent portion(2) $ 24.3 $ 17.3

(1)Included in accrued liabilities

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(2)Included in noncurrent liabilities�other

As discussed in Note 15, the company closed its synthetic rutile plant in Mobile, Alabama, in 2003. In September 2004, the companyshutdown sulfate and gypsum production at its Savannah, Georgia, plant. Until the decisions to shutdown these facilities had been made, itwas undeterminable when the asset retirement liability associated with these facilities would be settled. Upon deciding to shutdown thefacilities, the timing of settlement became estimable and the related asset retirement obligation was recorded at the estimated fair value. Forthe synthetic rutile plant in Mobile, Alabama, a $17.6 million liability was recognized at the beginning of 2003. For the sulfate productionfacility at the company's Savannah, Georgia, plant, an abandonment liability of $12.7 million was recognized in September 2004.

Operations at the Mobile, Alabama, facility included production of feedstock for one of company's titanium dioxide pigment plants. Thefacility ceased operations in June 2003. Operations prior to closure had resulted in minor contamination of groundwater adjacent to surfaceimpoundments. A groundwater recovery system was installed prior to closure and continues in operation as required under the NationalPollutant Discharge Elimination System (NPDES) permit. Future remediation work, including groundwater recovery, closure of theimpoundments and other minor work, is expected to be substantially completed in about five years. As of December 31, 2004, the companyhad remaining abandonment reserves of $11.3 million related to the remediation work described above and $6.7 million related todecommissioning of the facility. Although actual costs may exceed current estimates, the amount of any increases cannot be reasonablyestimated at this time.

In 2004, an abandonment reserve related to the titanium dioxide pigment sulfate production at Savannah, Georgia, was established toaddress probable remediation activities, including environmental assessment, closure of certain impoundments, groundwater monitoring,asbestos abatement, and other work, which are expected to take over 25 years. As of December 31, 2004, the reserve was $12.9 million.Although actual costs may exceed current estimates, the amount of any increase cannot be reasonably estimated at this time.

18. Employee Benefit Plans

U.S. Plans�U.S. employees of the company participate in the noncontributory defined benefit pension plans and the contributorypostretirement plans for health care and life insurance sponsored by Kerr-McGee. Benefits under the qualified defined benefit plan aregenerally based on years of service and final average pay. Company employees also participate in a Kerr-McGee sponsored supplementalnonqualified plan designed to maintain benefits for all employees at the plan formula level. Substantially all U.S. employees may becomeeligible for the postretirement benefits if they reach retirement age while working for Kerr-McGee.

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Kerr-McGee allocates costs associated with its U.S. plans based on salary for defined benefit pension plans and based on activeheadcount for postretirement plans. Net periodic (benefit) cost associated with the U.S. plans allocated to the company for each of the lastthree years was as follows:

U.S. Retirement Plans Allocation U.S. Postretirement Plans Allocation

2004 2003 2002 2004 2003 2002


Net periodic (benefit) cost, excluding special terminationbenefits, settlement and curtailment losses

$ (6.2) $ (15.0) $ (20.1) $ 10.0 $ 7.2 $ 10.2

Special termination benefits, settlement and curtailment losses 8.6 23.7 � 0.5 5.0 �

Total net periodic (benefit) cost $ 2.4 $ 8.7 $ (20.1) $ 10.5 $ 12.2 $ 10.2

The 2004 period includes curtailment loss and special termination benefits associated with the shutdown of sulfate production at theSavannah, Georgia facility and losses on settlement of certain qualified benefits as a result of cash settlements associated with retirements,including retirements associated with the work force reduction program announced in 2003. In 2003, the company recognized a curtailmentloss with respect to pension and postretirement benefits in connection with its U.S. work force reduction program and plant closures andrecognized special termination benefits associated with its U.S. work force reduction program.

The costs that have historically been allocated to the company are not necessarily indicative of the costs that will be incurred in the futureby the company for U.S. benefit plans. Only costs associated with active and inactive employees of the company's domestic chemical businessare included in the above table and do not include any amounts for Kerr-McGee corporate employees that may become employees of Tronoxafter the spin-off.

For the periods presented, the company was not the plan sponsor for the U.S. qualified and non-qualified retirement plans and the U.S.health and welfare plans. Accordingly, the company's Combined Balance Sheet does not reflect any such assets or liabilities. As describedbelow, the company intends to establish such plans for its U.S. employees and former employees, which will result in a transfer of assets tothe company and an assumption of obligations associated with such newly established plans.

The company plans to establish a U.S. tax-qualified defined benefit retirement plan and related trust for the company's employees andformer employees who participated in Kerr-McGee's defined benefit retirement plans at the Distribution date. In connection with theassumption of obligations by Tronox, Kerr-McGee will transfer assets from the trust for Kerr-McGee's defined benefit retirement plans to thetrust for Tronox's plan. It is anticipated that the company's defined benefit obligation for this plan, determined on a plan termination basis asset forth in the employee benefits agreement, will be approximately $442 million and will be underfunded by approximately $14.4 million atthe Distribution date (unaudited).

The company plans to establish a U.S. defined benefit non-qualified deferred compensation plan that will assume the obligations of thedefined benefit portion of the Kerr-McGee Benefits Restoration Plan with respect to the company's current and former employees. Thecompany will assume the projected benefit obligation related to such employees and Kerr-McGee will transfer the related assets as set forth inthe employee benefits agreement. It is anticipated that this plan will be underfunded by approximately $3.9 million (unaudited).

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The company plans to establish appropriate health and welfare benefit plans prior to completion of the Distribution to provide benefits tothe company's U.S. employees that are anticipated to be similar to the health and welfare benefits provided currently to the employees byKerr-McGee. Certain retiree medical benefits are available to eligible U.S. employees meeting certain age and service requirements upontermination of employment. It is anticipated that the projected benefit obligation relating to all eligible retired and active vested participantsrelated to the company of approximately $148 million will be assumed by the company at the Distribution date (unaudited). There are noassets associated with this plan that will be transferred. The company has also agreed that the Material Features (as defined in the EmployeeBenefits Agreement) of the plan that apply to retirees will not be amended before the third anniversary of the Distribution.

Foreign Plans�The foreign entities of the Company are the plan sponsors of their respective plans. The company's employees inGermany and in the Netherlands will continue to participate in pension plans in place at the date of the Distribution. The company uses aDecember 31 measurement date for foreign plans. Following are disclosures related to the foreign plans.

Changes in the total projected benefit obligation for the foreign pension plans during 2004 and 2003 were as follows:

2004 2003


Benefit obligation, beginning of year $ 63.4 $ 51.1Service cost 1.9 1.7Interest cost 3.4 3.1Plan amendments/law changes 0.7 (2.8)Net actuarial loss 7.9 0.9Foreign exchange rate changes 6.2 10.2Contributions by plan participants 0.4 �

Benefits paid (1.4) (0.8)

Benefit obligation, end of year $ 82.5 $ 63.4

Expected benefit payments for the next five years and, in the aggregate for the years 2010 through 2014 are $1.7 million in 2005,$1.9 million in 2006, $2.1 million in 2007, $2.3 million in 2008, $2.6 million in 2009 and $14.8 million in 2010 through 2014.

The following summarizes the accumulated and projected benefit obligations and the funded status of each of the company's foreignplans at December 31, 2004 and 2003:

At December 31, 2004 At December 31, 2003

The

Netherlands

Retirement

Plan

Germany

Retirement

Plan

The

Netherlands

Retirement

Plan

Germany

Retirement

Plan


Accumulated benefit obligation $ 60.9 $ 12.2 $ 48.9 $ 9.9

Projected benefit obligation $ 69.9 $ 12.6 $ 53.2 $ 10.2Market value of plan assets 59.2 � 51.3 �

Funded status $ (10.7) $ (12.6) $ (1.9) $ (10.2)

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Changes in the fair value of plan assets during 2004 and 2003 and the reconciliation of the plans' funded status to the amounts recognizedin the financial statements for the foreign retirement plans at December 31, 2004 and 2003 were as follows:

2004 2003


Fair value of plan assets, beginning of year $ 51.3 $ 39.0Actual return on plan assets 2.4 4.0Employer contributions 1.9 0.8Participant contributions 0.4 �

Foreign exchange rate changes 4.4 8.2Benefits paid (1.2) (0.7)

Fair value of plan assets, end of year 59.2 51.3Benefit obligation (82.5) (63.4)

Funded status of plans (23.3) (12.1)Amounts not recognized in the Combined Balance Sheet

Prior service cost (2.3) (3.1)Net actuarial loss 22.1 12.3

Accrued liability $ (3.5) $ (2.9)

Accumulated benefit obligation $ (73.1) $ (58.8)

The company expects to contribute $2.2 million to its foreign retirement plans in 2005.

Classification of the amounts recognized in the Combined Balance Sheet for the foreign retirement plans at December 31, 2004 and 2003is shown below:

2004 2003


Prepaid pension cost $ � $ 6.3Accrued benefit liability (14.0) (10.1)Accumulated other comprehensive income (before tax) 10.5 0.9

Total $ (3.5) $ (2.9)

For 2004, 2003 and 2002, the company had after-tax losses of $6.1 million, $0.6 million and nil, respectively, included in othercomprehensive income resulting from changes in the additional minimum pension liability.

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Net periodic pension cost components for the foreign retirement plans for the years ended December 31, 2004, 2003 and 2002 were asfollows:

2004 2003 2002


Net periodic cost�Service cost $ 1.9 $ 1.7 $ 1.4Interest cost 3.4 3.1 2.5Expected return on plan assets (3.0) (2.4) (2.6)Net amortization-

Prior service cost (0.2) � �

Net actuarial loss 0.5 0.7 0.1

Total $ 2.6 $ 3.1 $ 1.4

Assumptions used in estimating the net periodic pension cost for the foreign plans were as follows:

2004 2003 2002

Germany

Plans

The

Netherlands

Plan

Germany

Plans

The

Netherlands

Plan

Germany

Plans

The

Netherlands

Plan

Discount rate 5.5% 5.25% 5.75% 5.5% 5.75% 5.75%Expected return on plan assets N/A 5.75 N/A 5.75 N/A 7.0Rate of compensation increases 2.75 2.82 2.75 5.0 3.0 2.5�7.5

The following presents assumptions used in estimating the actuarial present value of the foreign plans' benefit obligations:

2004 2003 2002

Germany

Plans

The

Netherlands

Plan

Germany

Plans

The

Netherlands

Plan

Germany

Plans

The

Netherlands

Plan

Discount rate 4.75% 4.75% 5.5% 5.25% 5.75% 5.5%Rate of compensation increases 3.0 3.5 2.75 2.82 2.75 2.5�6.5

Kerr-McGee based the discount rate assumptions for the foreign plans on local corporate bond index rates. Long-term rate of returnassumption for the Netherlands plan is developed considering the portfolio mix and country-specific economic data that includes the rates ofreturn on local government and corporate bonds.

Asset categories for the funded retirement plan of employees in the Netherlands and the weighted-average asset allocations atDecember 31, 2004 and 2003, by asset category are as follows:

December 31,

2004 2003

Equity securities 24% 28%Debt securities 76% 70%Other � 2%



Total 100% 100%

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The Netherlands plan is administered by a pension committee representing the employer, the employees and the pensioners, each withone equal vote. The pension committee members are approved by the state's lead pension agency based upon experience and character. Thepension committee meets at least quarterly to discuss regulatory changes, asset performance and asset allocation. The plan assets are managedby one Dutch fund manager against a mandate set at least annually by the pension committee. Annually the plan assets are evaluated by amultinational benefits consultant against state defined actuarial tests to determine funding requirements.

19. Employee Stock-Based Compensation

Under Kerr-McGee's incentive compensation plans, the company's employees were granted stock options, restricted stock, stockopportunity grants and performance unit awards. It is expected that the company will establish its own stock-based compensation plan at thetime of the offering.

Stock Options�Stock options held by the company's employees are fixed-price options granted at the fair market value of the underlyingcommon stock on the date of the grant. Generally, one-third of each grant vests and becomes exercisable over a three-year period immediatelyfollowing the grant date and expires 10 years after the grant date.

The following table summarizes transactions in Kerr-McGee stock options during 2004, 2003 and 2002 held by the company'semployees. This information does not include options activity associated with Kerr-McGee employees currently performing corporate andadministrative functions for the company that may become employees of the company at the time of the spin-off.

2004 2003 2002

Options

Weighted-

Average

Exercise

Price per

Option

Options

Weighted-

Average

Exercise

Price per

Option

Options

Weighted-

Average

Exercise

Price per

Option

Outstanding, beginning of year 1,077,764 $ 56.86 979,409 $ 59.29 542,958 $ 61.69Options granted 135,510 49.45 171,050 42.95 467,477 56.36Options exercised (127,051) 47.05 (400) 42.95 (1,950) 46.51Options forfeited (27,628) 50.80 (42,071) 55.57 (20,867) 56.84Options expired (54,980) 60.32 (30,224) 58.77 (8,209) 60.39

Outstanding, end of year 1,003,615 57.08 1,077,764 56.86 979,409 59.29

Exercisable, end of year 756,480 59.41 652,361 59.69 384,541 60.41

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The following table summarizes information about stock options described above that are outstanding and exercisable at December 31,2004:

Options Outstanding Options Exercisable

Options

Range of Exercise

Prices per

Option

Weighted-

Average

Remaining

Contractual

Life (years)

Weighted-

Average

Exercise

Price per

Option

Options

Weighted-

Average

Exercise

Price per

Option

203,898 $ 42.95�$49.99 7.9 $ 45.95 40,189 $ 42.95265,755 50.00� 54.99 5.3 54.14 207,022 54.1491,969 55.00� 59.99 2.8 59.08 91,969 59.08

288,956 60.00� 64.99 4.4 62.70 264,263 62.81153,037 65.00� 69.99 4.6 65.21 153,037 65.21

1,003,615 5.2 57.08 756,480 59.41

It is anticipated that unvested options to purchase Kerr-McGee common stock held by the company's employees and outstanding on theeffective date of the Distribution will be converted to options to acquire the company's stock. The stock options, as converted, will assume thesame vesting provisions, contractual life and other terms and conditions as the Kerr-McGee options they replaced. The number of shares andexercise price of each stock option will be adjusted so that each company option will have the same ratio of the exercise price per share to themarket value per share and the same aggregate difference between market value and exercise price as the Kerr-McGee stock options prior tothe conversion. No new measurement date is expected to occur upon conversion. Employees who hold vested options to purchase Kerr-McGee common stock as of the date of the Distribution may exercise such options for the lesser of three months after the effective date of theDistribution or the remaining term of the option award. However, employees who are eligible for retirement on the effective date of theDistribution may exercise their vested stock options for the lesser of four years after the effective date of the Distribution or the remainingterm of the option award. Vested options not exercised during the specified time period will expire. Following the January 2005 grant,approximately 481,800 options to purchase Kerr-McGee common stock were held by the company's employees at March 31, 2005.

Restricted Stock and Stock Opportunity Grants�Restricted stock under Kerr-McGee's plans was awarded in the name of the employeeand, except for the right of disposal, holders have full stockholders' rights during the period of restriction, including voting rights and the rightto receive dividends. Certain key employees in Europe and Australia have received stock opportunity grants giving them the opportunity toearn unrestricted stock in the future, provided that certain conditions are met. These stock opportunity grants do not carry voting privileges ordividend rights since the related shares are not issued until vested. Restricted stock and stock opportunity grants generally vest between threeand five years. The following table summarizes certain information with respect to restricted stock and stock opportunity grants made by Kerr-McGee in 2004, 2003 and 2002 to the company's employees.

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These transactions do not include shares associated with certain employees performing corporate and administrative functions for thecompany that may become employees of Tronox at the time of spin-off.

2004 2003 2002

Restricted

Stock

Stock

Opportunity

Awards

Restricted

Stock

Stock

Opportunity

Awards

Restricted

Stock

Stock

Opportunity

Awards

Shares granted 37,127 6,616 52,100 8,650 10,000 �

Weighted average grant-date fair value $ 49.45 $ 49.45 $ 43.19 $ 43.19 $ 57.58 �

Compensation expense allocated to the company associated with restricted stock and stock opportunity awards made to the company'semployees was $2.2 million, $1.2 million and nil in 2004, 2003, and 2002, respectively.

On the effective date of the Distribution, restricted stock and stock opportunity awards are expected to be converted to awards of thecompany's stock with the same terms and conditions, except that the number of shares covered by the awards will be adjusted using a ratio ofKerr-McGee share price to the company's share price, as defined in the Employee Benefits Agreement between the company and Kerr-McGee. Following the January 2005 grant, approximately 112,000 shares of Kerr-McGee restricted stock and 20,000 shares of Kerr-McGeestock opportunity awards were held by the company's employees at March 31, 2005.

Performance Units�Performance units provide for cash awards that are based on Kerr-McGee's total stockholder return over a statedperiod as compared to selected peer companies. At December 31, 2004 and 2003, the company's employees held 1,243,234 and 1,332,000performance units, respectively. Compensation expense allocated to the company associated with performance units was not material for allperiods presented. Following the January 2005 grant, approximately 2,468,000 performance units were held by the company's employees atMarch 31, 2005.

Performance unit awards that are vested at the time of the completion of the Distribution will be paid by Kerr-McGee in accordance withthe terms of the relevant plan. Unvested performance unit awards held by the company's employees as of the date of the Distribution will beforfeited. The company will provide a stock option or restricted stock grant equal to the value of the forfeited awards. The value will bedetermined by calculating total shareholder return and associated payout as if the entire performance cycle ended on the date of the offering.

Employee Stock Ownership Plan�The company's employees participate in the Kerr-McGee Corporation Savings Investment Plan (SIP),a defined contribution plan sponsored by Kerr-McGee. Kerr-McGee makes matching contributions to a leveraged Employee Stock OwnershipPlan (ESOP), which is a part of the SIP. Shares held in the ESOP trust are allocated to participant's accounts in the SIP in satisfaction of thematching contribution. Compensation expense associated with the Kerr-McGee SIP allocated to the company was $3.5 million, $9.8 millionand $3.7 million in 2004, 2003 and 2002, respectively. The company expects to establish, effective on the date of the Distribution, its owndefined contribution plan.

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20. Other Income (Expense)

Components of other income (expense) in 2004, 2003 and 2002 were as follows:

2004 2003 2002


Net foreign currency transaction gain (loss) $ (5.4) $ (3.7) $ 6.4Equity in net earnings of equity method investees 2.4 0.8 0.5Interest expense, net (9.6) (8.9) (11.2)Loss on accounts receivables sales (8.2) (4.8) (4.7)Other expense (4.5) (4.0) (4.2)

Total $ (25.3) $ (20.6) $ (13.2)

21. Contingencies

The following table summarizes the contingency reserve balances, provisions, payments and settlements for 2002, 2003 and 2004, aswell as balances, accruals and receipts of reimbursements of environmental costs from other parties.

Reserves for

Litigation(1)

Reserves for

Environmental

Remediation(2)

Reimbursements

Receivable(3)


Balance, December 31, 2001 $ 20.7 $ 162.3 $ �

Provisions / Accruals 69.1 188.1 112.7Payments / Settlements (46.9) (121.1) �

Balance, December 31, 2002 42.9 229.3 112.7Provisions / Accruals 1.3 88.2 32.2Payments / Settlements (38.4) (97.9) (14.8)

Balance, December 31, 2003 5.8 219.6 130.1Provisions / Accruals 0.2 81.4 14.2Payments / Settlements (3.4) (85.2) (50.5)

Balance, December 31, 2004 $ 2.6 $ 215.8 $ 93.8

(1)Provisions for litigation in 2002, 2003 and 2004 include $69.1 million, $1.2 million and nil, respectively, related to the company's formerforest products operations and thorium manufacturing operations and, therefore, are reflected in loss from discontinued operations (netof tax) in the Combined Statement of Operations.

(2)Provisions for environmental remediation and restoration in 2002, 2003 and 2004 include $173.8 million, $52.3 million and$75.7 million, respectively, related to the company's former forest products operations, thorium manufacturing, uranium and refiningoperations. These charges are reflected in the Combined Statement of Operations as a component of loss from discontinued operations(net of tax).



(3)Reimbursements for environmental remediation and restoration in 2002, 2003 and 2004 include $112.7 million, $11.2 million and$14.2 million, respectively, related to the company's former thorium manufacturing operations, which are reflected in the CombinedStatement of Operations as a component of loss from discontinued operations (net of tax).

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Management believes, after consultation with internal legal counsel, that currently the company has reserved adequately for thereasonably estimable costs of environmental matters and other contingencies. Additions to the reserves may be required as additionalinformation is obtained that enables the company to better estimate its liabilities, including liabilities at sites now under review. At this time,however, the company cannot reliably estimate a range of future additions to the reserves for any individual site or for all sites collectively.Following are discussions regarding certain environmental sites and litigation. Reserves for each environmental site are based on assumptionsregarding the volumes of contaminated soils and groundwater involved, as well as associated excavation, transportation and disposal costs.

The company provides for costs related to contingencies when a loss is probable and the amount is reasonably estimable. It is notpossible for the company to reliably estimate the amount and timing of all future expenditures related to environmental and legal matters andother contingencies because, among other reasons:



�� cleanup requirements are difficult to predict at sites where remedial investigations have not been completed or final decisionshave not been made regarding cleanup requirements, technologies or other factors that bear on cleanup costs;

�� environmental laws frequently impose joint and several liability on all potentially responsible parties, and it can be difficult todetermine the number and financial condition of other potentially responsible parties and their respective shares ofresponsibility for cleanup costs;

�� environmental laws and regulations, as well as enforcement policies, are continually changing, and the outcome of courtproceedings and discussions with regulatory agencies are inherently uncertain;

�� some legal matters are in the early stages of investigation or proceeding or their outcomes otherwise may be difficult topredict, and other legal matters may be identified in the future;

�� unanticipated construction problems and weather conditions can hinder the completion of environmental remediation; theinability to implement a planned engineering design or use planned technologies and excavation methods may requirerevisions to the design of remediation measures, which delay remediation and increase costs; and the identification ofadditional areas or volumes of contamination and changes in costs of labor, equipment and technology generate correspondingchanges in environmental remediation costs.

Environmental

Henderson, Nevada

In 1998, Tronox LLC (formerly Kerr-McGee Chemical LLC) decided to exit the ammonium perchlorate business. At that time, TronoxLLC curtailed operations and began preparation for the shutdown of the associated production facilities in Henderson, Nevada, that producedammonium perchlorate and other related products. Manufacture of perchlorate compounds began at Henderson in

F-38



1945 in facilities owned by the U.S. government. The U.S. Navy expanded production significantly in 1953 when it completed construction ofa plant for the manufacture of ammonium perchlorate. The Navy continued to own the ammonium perchlorate plant as well as otherassociated production equipment at Henderson until 1962, when the plant was purchased by a predecessor of the company. The ammoniumperchlorate produced at the Henderson facility was used primarily in federal government defense and space programs. Perchlorate that mayhave originated, at least in part, from the Henderson facility has been detected in nearby Lake Mead and the Colorado River, which contributeto municipal water supplies in Arizona, Southern California and Southern Nevada.

Tronox LLC began decommissioning the facility and remediating associated perchlorate contamination, including surface impoundmentsand groundwater, when it decided to exit the business in 1998. In 1999 and 2001, Tronox LLC entered into consent orders with the NevadaDivision of Environmental Protection (NDEP) that requires it to implement both interim and long-term remedial measures to capture andremove perchlorate from groundwater. In April 2005, Tronox LLC entered into an amended consent order with NDEP that requires, inaddition to the capture and treatment of groundwater, the closure of a certain impoundment related to the past production of ammoniumperchlorate, including treatment and disposal of solution and sediment contained in the impoundment.

In 1999, Tronox LLC initiated the interim measures required by the consent orders. A long-term remediation system is operating incompliance with the consent orders. Initially, the remediation system was projected to operate through 2007. However studies of the decline ofperchlorate levels in the groundwater indicate that Tronox LLC may need to operate the system through 2011. The scope, duration and cost ofgroundwater remediation ultimately will be driven in the long term by drinking water standards regarding perchlorate, which to date have notbeen formally established by applicable state or federal regulatory authorities. The Environmental Protection Agency (EPA) and other federaland state agencies continue to evaluate the health and environmental risks associated with perchlorate as part of the process for ultimatelysetting drinking water standards. One state agency, the California Environmental Protection Agency (CalEPA), has set a public health goal forperchlorate, and the federal EPA has established a reference dose for perchlorate, which are preliminary steps to setting drinking waterstandards. The establishment of drinking water standards could materially affect the scope, duration and cost of the long-term groundwaterremediation that Tronox LLC is required to perform.

Financial Reserves�Reserves for Henderson totaled $11.0 million as of December 31, 2004. In the first quarter of 2005, $26.2 millionwas added to the reserve for Henderson to cover the operating and maintenance costs over the extended period for groundwater treatment and$4.2 million was added for closure of the ammonium perchlorate pond. Remaining reserves for Henderson totaled $40.0 million as ofMarch 31, 2005. As noted above, the long-term scope, duration and cost of groundwater remediation and impoundment closure are uncertainand, therefore, additional costs beyond those accrued may be incurred in the future. However, the amount of any additional costs cannot bereasonably estimated at this time.

Litigation�In 2000, Tronox LLC initiated litigation against the United States seeking contribution for its Henderson response costs. Thesuit is based on the fact that the government owned the plant in the early years of its operation, exercised significant control over production atthe plant and the sale of products produced at the plant, even while not the owner, and was the largest consumer of products produced at theplant. The discovery stage of litigation is substantially complete, and the parties have filed certain pretrial motions that are being consideredby the court. Although the outcome of the

F-39



litigation is uncertain, the company believes it is likely to recover a portion of its costs from the government. The amount and timing of anyrecovery cannot be estimated at this time and, accordingly, the company has not recorded a receivable or otherwise reflected in the financialstatements any potential recovery from the government.

In addition, on July 26, 2004, Tronox LLC was served with a lawsuit, which was filed in the United States District Court for the Districtof Arizona. The lawsuit, Alan Curtis and Linda Curtis v. City of Bullhead City, et al., in which Tronox LLC is one of several defendants (theDefendants), alleges various causes of action under a variety of common law theories and federal environmental laws and seeks recovery fordamages allegedly caused by the alleged exposure to and the migration of various chemical contaminants contained in the Colorado River.The two plaintiffs, who are not suing on behalf of any other party, also seek an order requiring the Defendants to remediate the contamination.The company intends to vigorously defend against the lawsuit. The company believes that the litigation will not have a material adverse effecton its financial condition or results of operations.

Insurance�In 2001, Tronox LLC purchased a 10-year, $100 million environmental cost cap insurance policy for groundwater and otherremediation at Henderson. The insurance policy provides coverage only after Tronox LLC exhausts a self-insured retention of approximately$61.3 million and covers only those costs incurred to achieve a cleanup level specified in the policy. As noted above, federal and stateagencies have not established a drinking water standard and, therefore, it is possible that Tronox LLC may be required to achieve a cleanuplevel more stringent than that covered by the policy. If so, the amount recoverable under the policy may be less than the ultimate cleanup cost.

At December 31, 2004, expenditures incurred to date of approximately $67.2 million plus remaining costs to be incurred ofapproximately $9.5 million exceeded the self-insured retention, resulting in an expected insurance reimbursement based on those costestimates. The company believes that the reimbursement is probable and, accordingly, recorded a receivable in the financial statements of$15.0 million as of December 31, 2004. In connection with the additional reserve recorded in the first quarter of 2005 discussed above, thecompany expects an additional $19.0 million to be covered by the insurance policy. The company believes that at March 31, 2005, areimbursement of $34.0 million is probable and, accordingly, has recorded a receivable in the financial statements for the first quarter of 2005for that amount.

West Chicago, Illinois

In 1973, Tronox LLC closed a facility in West Chicago, Illinois, that processed thorium ores for the federal government and for certaincommercial purposes. Historical operations had resulted in low-level radioactive contamination at the facility and in surrounding areas. Theoriginal processing facility is regulated by the State of Illinois (the State), and four vicinity areas are designated as Superfund sites on theNational Priorities List (NPL).

Closed Facility�Pursuant to agreements reached in 1994 and 1997 among Tronox LLC, the City of West Chicago and the State regardingthe decommissioning of the closed West Chicago facility, Tronox LLC has substantially completed the excavation of contaminated soils andhas shipped those soils to a licensed disposal facility. Surface restoration was completed in 2004, except for areas designated for use inconnection with the Kress Creek and Sewage Treatment Plant remediation discussed below. Groundwater monitoring and remediation isexpected to continue for approximately ten years.

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Vicinity Areas�EPA has listed four areas in the vicinity of the closed West Chicago facility on the NPL and has designated Tronox LLCas a Potentially Responsible Party (PRP) in these four areas. Tronox LLC has substantially completed remedial work for two of the areas(known as the Residential Areas and Reed-Keppler Park). The other two NPL sites, known as Kress Creek and the Sewage Treatment Plant,are contiguous and involve low levels of insoluble thorium residues, principally in streambanks and streambed sediments, virtually all within afloodway. Tronox LLC has reached an agreement with the appropriate federal and state agencies and local communities regarding thecharacterization and cleanup of the sites, past and future government response costs, and the waiver of natural resource damages claims. Theagreement has been incorporated in a consent decree, which must be entered by a federal court. The consent decree was lodged with the courtin April 2005 and is expected to be approved by the court in due course. The cleanup work, which is expected to take about four to five yearsto complete following entry of the consent decree, will require excavation of contaminated soils and stream sediments, shipment of excavatedmaterials to a licensed disposal facility and restoration of affected areas.

Financial Reserves�In 2004, $30.9 million was added to the reserve for the West Chicago site to cover increased soil volumesencountered at the closed facility, anticipated groundwater remediation the company believes will be required following soil removal at theclosed facility, increased soil volumes at Kress Creek and required future payments for past costs and access fees. As of December 31, 2004,the company had reserves of $102.1 million for costs related to the West Chicago facility and vicinity properties. In the first quarter of 2005,$10.0 million was added to the reserve for West Chicago site to cover increased soil volumes encountered during the final stage ofcharacterization of Kress Creek and increases in labor and materials. Although actual costs may exceed current estimates, the amount of anyincrease cannot be reasonably estimated at this time. The amount of the reserve is not reduced by reimbursements expected from the federalgovernment under Title X of the Energy Policy Act of 1992 (Title X) (discussed below).

Government Reimbursement�Pursuant to Title X, the U.S. Department of Energy (DOE) is obligated to reimburse the company forcertain decommissioning and cleanup costs incurred in connection with the West Chicago sites in recognition of the fact that about 55% of thefacility's production was dedicated to U.S. government contracts. The amount authorized for reimbursement under Title X is $365 million plusinflation adjustments. That amount is expected to cover the government's full share of West Chicago cleanup costs. Through December 31,2004, the company had been reimbursed approximately $215.0 million under Title X.

Reimbursements under Title X are provided by congressional appropriations. Historically, congressional appropriations have lagged thecompany's cleanup expenditures. As of December 31, 2004, the government's share of costs incurred by the company but not yet reimbursedby the DOE totaled approximately $78.8 million. The company believes receipt of the $78.8 million government share in due course followingadditional congressional appropriations is probable and has reflected that amount as a receivable in the financial statements. Approximately$65.7 million of the $78.8 million arrearage was received during the first quarter of 2005. The company will recognize recovery of thegovernment's share of future remediation costs for the West Chicago sites as it incurs the cash expenditures.

F-41




From the late 1950s until 1988, the company operated a uranium mining and milling operation at Ambrosia Lake near Grants, NewMexico pursuant to a license issued by the Atomic Energy Commission (AEC) (now the Nuclear Regulatory Commission (NRC)). When theoperation was sold, the company retained responsibility for certain environmental conditions existing at the site, including mill tailings,selected ponds and groundwater contamination. Since 1988, the current owner of the site has been decommissioning the site pursuant to thelicense issued by NRC. Mill tailings and selected pond sediments have been consolidated in an onsite containment unit. A request to ceasegroundwater treatment has been under review by the NRC since 2001. In addition, a decommissioning plan for remaining impacted soil wassubmitted by the current owner to the NRC in January 2005 and is currently under review. If approved, the soil decommissioning plan wouldtake about two to three years to complete.

Financial Reserves�As of December 31, 2004, the company had reserves of $7.7 million for the costs of the remediation activitiesdescribed above, including groundwater remediation. Although actual costs may exceed current estimates, the amount of any increases cannotbe reasonably estimated at this time.

In addition, the current owner is investigating soil contamination potentially caused by past discharge of mine water from the site. Also,the State of New Mexico has recently raised issues about certain non-radiological constituents in the groundwater at the site. The request tocease groundwater treatment, which is being reviewed by the NRC, will be amended to include these non-radiological constituents.Discussions regarding these issues are ongoing, and resolution of them could affect remediation costs and/or delay ultimate site closure.

Crescent, Oklahoma

Beginning in 1965, Cimarron Corporation ("Cimarron") operated a facility near Crescent, Oklahoma at which it produced uranium andmixed oxide nuclear fuels pursuant to licenses issued by AEC (now NRC). Operations at the facility ceased in 1975. Since that time, buildingsand soils were decommissioned in accordance with the NRC licenses. In limited areas of the site, groundwater is contaminated withradionuclides, and, in 2003, Cimarron submitted to the NRC and the Oklahoma Department of Environmental Quality (ODEQ) a draftremediation work plan addressing the groundwater contamination. It is anticipated that in 2005 the company will evaluate availabletechnologies and submit a final plan to the NRC and the ODEQ addressing remaining groundwater issues. Duration of remedial activitiescurrently cannot be estimated.

Financial Reserves�As of December 31, 2004, the company had reserves of $7.1 million for the costs of the remediation activities,including those currently under evaluation, described above. Although actual costs may exceed current estimates, the amount of any increasescannot be reasonably estimated at this time.

Lakeview, Oregon

A predecessor of Tronox Worldwide LLC operated two uranium mines near Lakeview, Oregon from 1958 to 1960. The mines arecurrently designated as a Superfund site. In 2001, EPA issued a Record of Decision requiring consolidation and capping of contaminated soilsand continued

F-42



neutralization of acidic waters in one of the two mines. It is anticipated that required work will take about two to three more years to complete.

Litigation�In April 2005, Tronox Worldwide LLC and two other parties reached an agreement in principle with the federal governmentto settle a lawsuit filed by the government with respect to the remediation of contaminated materials at the site and to settle related claims bythe parties. The suit sought reimbursement of Forest Service response costs, an injunction requiring compliance with a UnilateralAdministrative Order issued to the private parties regarding cleanup of the site, and civil penalties for alleged noncompliance with theadministrative order. As a result of the settlement, the parties have resolved their respective claims and agree to apportion responsibility forthe cleanup. Provided the settlement is formalized, the remediation would begin in the third quarter of 2005 and take between one and twoyears to complete.

Financial Reserves�As of December 31, 2004, the company had reserves of $8.3 million for the costs of the remediation activitiesdescribed above. Although actual costs may exceed current estimates, the amount of any increases cannot be reasonably estimated at this time.

Soda Springs, Idaho

From 1963 to 2000, Tronox LLC owned and operated a vanadium processing facility near Soda Springs, Idaho. In 1989, EPA designatedthis site as a Superfund site under the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA), listed the site onthe NPL and named Tronox LLC as a PRP. In 2000, EPA amended a Record of Decision (ROD) previously issued by it, requiring TronoxLLC to address the presence of calcine tailings, a byproduct of vanadium processing. The amended ROD required the capping of the calcinetailings in place and the closure of certain impoundments.

Since 2000, the vanadium processing facility plant and a fertilizer plant on the site have been closed, dismantled and removed from thesite. All former impoundments included in the amended ROD have been closed. A ten-acre pond not covered by the ROD is scheduled forclosure within the next two years. Tronox LLC anticipates constructing a landfill onsite as part of the closure.

Financial Reserves�As of December 31, 2004, the company had reserves of $3.0 million for the costs of the remediation required by theROD as well as closure of the above mentioned ten-acre pond. Although actual costs may exceed current estimates, the amount of anyincreases cannot be reasonably estimated at this time.


In 1976, Tronox LLC closed a wood-treatment facility it had operated in Milwaukee, Wisconsin. Operations at the facility prior to itsclosure had resulted in the contamination of soil and groundwater at and around the site with creosote and other substances used in woodtreating. In 1984, EPA designated the Milwaukee wood-treatment facility as a Superfund site under CERCLA, listed the site on the NPL andnamed Tronox LLC as a PRP. Tronox LLC executed a consent decree in 1991 that required it to perform soil and groundwater remediation atand below the former wood-treatment area and to address a tributary creek of the Menominee River that had become contaminated as a resultof the wood-treatment operations. Actual remedial activities were deferred until after the decree was finally entered in 1996 by a federal courtin Milwaukee.

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Groundwater treatment was initiated in 1996 to remediate groundwater contamination below and in the vicinity of the former wood-treatment area. It is not possible to reliably predict how groundwater conditions will be affected by soil removal in the vicinity of the formerwood-treatment area, which has been completed, and by ongoing groundwater treatment. It is unknown, therefore, how long groundwatertreatment will continue. Soil cleanup of the former wood-treatment area began in 2000 and was completed in 2002. Also in 2002, remedialdesigns for the upper portion of the tributary creek were agreed to with EPA, after which Tronox LLC began the implementation of a remedyto reroute the creek and to remediate associated sediment and stream bank soils. Remediation of the upper portion of the creek is expected totake about three more years. Tronox LLC has not yet agreed with relevant regulatory authorities regarding remedial designs for the lowerportion of the tributary creek.

Financial Reserves�As of December 31, 2004, the company had reserves of $6.5 million for the costs of the remediation work describedabove. Although actual costs may exceed current estimates, the amount of any increases cannot be reasonably estimated at this time. The costsassociated with remediation, if any, of the lower portion of the tributary creek are not reasonably estimable.


Tronox LLC was named in 1999 as a PRP under CERCLA at a former wood-treatment site in New Jersey at which EPA is conducting acleanup. On April 15, 2005, Tronox LLC and its ultimate parent received a letter from EPA asserting that they are liable under CERCLA as aformer owner or operator of the site and demanding reimbursement of costs expended by EPA at the site. The demand is for payment of pastcosts in the amount of approximately $179 million, plus interest. Tronox LLC did not operate the site, which had been sold to a third partybefore Tronox LLC succeeded to the interests of a predecessor owner in the 1960's. The predecessor also did not operate the site, which hadbeen closed down before it was acquired by the predecessor. Based on historical records, there are substantial uncertainties about whether orunder what terms the predecessor assumed liabilities for the site. In addition, it appears there may be other PRPs, though it is not knownwhether the other PRPs have received similar letters from EPA. The company intends to vigorously defend against EPA's claim. The companyhas not recorded a reserve for the site as it is not possible to reliably estimate the liability, if any, it may have for the site because of theaforementioned defenses and uncertainties and the potential existence of other PRPs.

Sauget, Illinois

From 1927 to 1969, Tronox LLC operated a wood-treatment plant on a 60-acre site in the Village of Sauget (formerly known asMonsanto) in St. Clair County, Illinois. Operations on the property resulted in the contamination of soil, surface water, and groundwater at thesite with creosote and other substances used in wood treating. In 1988, Tronox LLC entered into a court-approved consent order with theIllinois Attorney General and Illinois Environmental Protection Agency. The consent order requires Tronox LLC to perform an environmentalinvestigation and remediation feasibility study, and this work is ongoing. Soil remediation and groundwater monitoring are being conducted,and further remediation options to address sediment and surface water are being evaluated. Duration of remedial activities currently cannot beestimated.

Financial Reserves�As of December 31, 2004, the company had reserves of approximately $4.1 million for the remediation activities,including those currently under evaluation, described above. Although actual costs may exceed current estimates, the amount of any increasescannot be reasonably estimated at this time.

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In January 2003, Tronox LLC entered into a consent order with the Mississippi Department of Environmental Quality to implement aremedy pursuant to an approved remediation work plan for a wood-treatment site in Hattiesburg, Mississippi. Components of the work planincluded excavation of certain materials from the former processing areas and off-site sediments and containment of other on-site and off-sitematerials. Remediation of the former processing and certain off-site areas was completed in 2003. Some off-site remediation required by thework plan has not been completed where access by current leaseholders has been denied. Efforts to obtain necessary access are ongoing, andremedial activities are expected to take about one to two more years once access is obtained.

Financial Reserves�As of December 31, 2004, the company had reserves of approximately $2.9 million for the remediation activitiesdescribed above. Although actual costs may exceed current estimates, the amount of any increases cannot be reasonably estimated at this time.

Cleveland, Oklahoma

Kerr-McGee Refining Corporation ("KM Refining") owned and operated a petroleum refinery near Cleveland, Oklahoma until thefacility was closed in 1972. In 1992, KM Refining entered into a Consent Order with the Oklahoma Department of Health (later, the ODEQ),which addresses the remediation of air, soil, surface water and ground water contaminated by hydrocarbons and other refinery relatedmaterials. Facility dismantling and several interim remedial measures have been completed. In 2004, ODEQ approved the soil and wastefeasibility study, which includes construction of an on-site disposal cell. Design of the cell is in process. In addition, a feasibility study ofsurface and groundwater remedial measures has been submitted to ODEQ and currently is under review. Duration of remedial activitiescurrently cannot be estimated.

Financial Reserves�As of December 31, 2004, the company had reserves of approximately $3.8 million for the remediation activitiesdescribed above, including the remedial measures recommended in the feasibility study currently under review. Although actual costs mayexceed current estimates, the amount of any increases cannot be reasonably estimated at this time.

Cushing, Oklahoma

In 1972, KM Refining closed a petroleum refinery it had operated near Cushing, Oklahoma. Prior to closing the refinery, KM Refiningalso had produced uranium and thorium fuel and metal at the site pursuant to licenses issued by the AEC. The uranium and thorium operationscommenced in 1962 and were shutdown in 1966, at which time KM Refining decommissioned and cleaned up to applicable standards theportion of the facility related to uranium and thorium operations. The refinery also was cleaned up to applicable standards at the time ofclosing.

Subsequent regulatory changes have required more extensive remediation at the site. In 1990, KM Refining entered into a consentagreement with the State of Oklahoma to investigate the site and take appropriate remedial actions related to petroleum refining and uraniumand thorium residuals. Investigation and remediation of hydrocarbon contamination is being performed under the oversight of the ODEQ. Soilremediation to address hydrocarbon contamination is expected to take about four more years. The long-term scope, duration and cost ofgroundwater remediation are uncertain and, therefore, additional costs beyond those accrued may be incurred in the future.

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Additionally, in 1993, KM Refining received a decommissioning license from the NRC, the successor to AEC's licensing authority, toperform certain cleanup of uranium and thorium residuals. All known radiological contamination has been removed from the site and shippedto a licensed disposal facility.

Financial Reserves�As of December 31, 2004, the company had reserves of $21.4 million for the costs of the ongoing remediation anddecommissioning work described above. Although actual costs may exceed current estimates, the amount of any increases cannot bereasonably estimated at this time.

Calhoun, Louisiana

From 1973 until 1988, KM Refining owned and operated a gas condensate stripping facility located near Calhoun, Louisiana. When thefacility was sold in 1988, KM Refining retained responsibility for environmental conditions existing prior to the date of closing. Operations atthe facility prior to the sale had resulted in the contamination of soil and groundwater with petroleum hydrocarbons. The LouisianaDepartment of Environmental Quality has approved a Corrective Action Plan for remediating the soil and groundwater contamination.Remediation is ongoing and expected to take about three more years.

Financial Reserves�As of December 31, 2004, the company had reserves of $5.8 million for the costs of the remediation activitiesdescribed above. Although actual costs may exceed current estimates, the amount of any increases cannot be reasonably estimated at this time.

Other Sites

In addition to the sites described above, the company is responsible for environmental costs related to certain other sites. These sitesrelate primarily to wood-treating, chemical production, landfills, mining, and oil and gas refining, distribution and marketing. As ofDecember 31, 2004, the company had reserves of $32.1 million for the environmental costs in connection with these other sites. Althoughactual costs may exceed current estimates, the amount of any increases cannot be reasonably estimated at this time.

Litigation and Claims

Coal Supply Contract

A predecessor of Tronox Worldwide LLC entered into a coal supply contract with Peabody Coaltrade, Inc. ("PCI") in February 1998. In1998, the predecessor exited the coal business and assigned its rights and obligations under the coal supply contract to a third party. Inconnection with the assignment, the predecessor agreed to guarantee performance under the contract. PCI has notified Tronox WorldwideLLC of a threatened default by the assignee under the coal supply contract and that PCI may seek to hold Tronox Worldwide LLC liable underthe 1998 guaranty in the event of a default. In addition to other defenses to the enforceability of the guaranty, the company believes theguaranty expired in January 2003 when the primary term of the coal supply contract expired. No reserve has been provided for performanceunder the guaranty because the company does not believe a loss is probable and the amount of any loss is not reasonably estimable.

F-46



Western Fertilizer Contract

In 1995, the company executed an exclusive agreement with Western Fertilizer, Inc. ("Western Fertilizer") for the storage anddistribution of fertilizer produced by the company. In May 2000, the company terminated the agreement because the owner, operator and thekey person of Western Fertilizer, had been sentenced to serve 17 years in prison for federal crimes involving activities unrelated to thecompany, thus rendering Western Fertilizer unable to perform its duties under the agreement. In June 2000, Western Fertilizer filed forbankruptcy, and its trustee alleged that the company did not have the right to terminate the agreement. In May 2003, Western Fertilizer'sbankruptcy claim against Kerr-McGee and Tronox LLC was transferred to a litigation trust, and, in October 2004, the litigation trust filed anamended complaint in a pending federal lawsuit in the U.S. District Court in Idaho, seeking monetary damages of approximately $13 millionfor alleged breaches of contract. The litigation is in the early stages of discovery. The company believes that the claims made in the complaintare without substantial merit and is vigorously defending against them. The company believes that damages, if any, related to the claims willnot have a material adverse effect on the company.

Flint Hills Contract

On October 11, 2004, Kerr-McGee and Southwestern Refining Corporation were named defendants in a lawsuit filed by Flint HillsResources, LP. In the lawsuit, which has been removed to the U.S. District Court in the Southern District of Texas, Corpus Christi division,Flint Hills alleges that Kerr-McGee and Southwestern Refining Corporation breached certain environmental representations and warrantiescontained in the agreement pursuant to which Southwestern Refining Corporation sold its refinery in Corpus Christi, Texas to a predecessor ofFlint Hills. Flint Hills claims damages of approximately $7 million. The litigation is in the early stages of discovery. The company believesthat the claims made in the complaint are without substantial merit and is vigorously defending against them. The company believes thatdamages, if any, related to the claims will not have a material adverse effect on the company.


Between 1999 and 2001, Tronox LLC was named in 22 lawsuits in three states (Mississippi, Louisiana and Pennsylvania) in connectionwith former forest products operations located in those states (in Columbus, Mississippi; Bossier City, Louisiana; and Avoca, Pennsylvania).The lawsuits sought recovery under a variety of common law and statutory legal theories for personal injuries and property damages allegedlycaused by exposure to and/or release of creosote and other substances used in the wood-treatment process. Tronox LLC has executedsettlement agreements that are expected to resolve substantially all of the Louisiana, Pennsylvania and Mississippi lawsuits described above.Resolution of the remaining cases is not expected to have a material adverse effect on the company.

Following the adoption by the Mississippi legislature of tort reform, plaintiffs' lawyers filed many new lawsuits across the state ofMississippi in advance of the reform's effective date. On December 31, 2002, August 31, 2004, September 27, 2004 and May 2, 2005,approximately 250 lawsuits were filed against the company on behalf of approximately 5,100 claimants in connection with the company'sColumbus, Mississippi, operations, seeking recovery on legal theories substantially similar to those advanced in the litigation referred toabove. Substantially all of these lawsuits were filed in or have been removed to the U.S. District Court for the Northern District of Mississippi,and the court has

F-47



consolidated these lawsuits for pretrial and discovery purposes. On December 31, 2002, June 13, 2003, and June 25, 2004, three lawsuits werefiled against Tronox LLC in connection with a former wood-treatment plant located in Hattiesburg, Mississippi. On September 9, 2004,February 11, 2005, and March 2, 2005, three lawsuits were filed against Tronox LLC in connection with a former wood-treatment plantlocated in Texarkana, Texas. In addition, on January 3, 2005, February 16, 2005, and March 11, 2005, 32 lawsuits were filed against TronoxLLC and Tronox Worldwide LLC in connection with the Avoca, Pennsylvania facility described above. These lawsuits seek recovery on legaltheories substantially similar to those advanced in the litigation referred to above. A total of approximately 3,300 claimants now have assertedclaims in connection with the Hattiesburg plant, there are 64 plaintiffs named in the Texarkana lawsuits and approximately 4,600 plaintiffs arenamed in the new Avoca lawsuits. Tronox LLC has resolved approximately 1,490 of the Hattiesburg claims pursuant to a settlement reachedin April 2003, which has resulted in aggregate payments by Tronox LLC of approximately $0.6 million.

The company believes that the follow-on Columbus and Avoca claims, the remaining Hattiesburg claims and the claims related to theTexarkana plants are without substantial merit and are vigorously defending against them. The company has not provided a reserve for theselawsuits because at this time it cannot reasonably determine the probability of a loss, and the amount of loss, if any, cannot be reasonablyestimated. The company believes that the ultimate resolution of the forest products litigation will not have a material adverse effect on thecompany.

Kemira

In 2000, the company acquired its titanium dioxide production facility in Savannah, Georgia, from Kemira Pigments Oy, a Finnishcompany, and its parent, Kemira Oyj (together, "the Sellers"). After acquiring the facility, the company discovered that certain mattersassociated with environmental conditions and plant infrastructure was not consistent with representations made by the Sellers. The companysought recovery for breach of representations and warranties in a proceeding before the London Court of International Arbitration (LCIA). OnMay 9, 2005, the Company received notice from the LCIA that the LCIA had found in favor of the company as to liability with respect tocertain of the claims. The LCIA still must determine the amount of damages, and, in that regard, the company is seeking in excess of$40 million in damages, together with interest, costs and attorney fees. In light of the recent receipt of the lengthy arbitration decision on theliability phase and the complexity of the matter, the company currently cannot reasonably estimate the amount of damages that will beawarded. The company will recognize a receivable, if and when damages are awarded and all contingencies associated with any recovery areresolved.

Other Matters

The company is a party to a number of legal and administrative proceedings involving environmental and/or other matters pending invarious courts or agencies. These proceedings, individually and in the aggregate, are not expected to have a material adverse effect on thecompany. These are also proceedings associated with facilities currently or previously owned, operated or used by the company and/or itspredecessors, some of which include claims for personal injuries, property damages, clean up costs and other environmental matters. Currentand former operations of the company also involve management of regulated materials and are subject to various environmental laws andregulations. These laws and regulations will obligate the company to clean up various sites at which petroleum and other hydrocarbons,chemicals, low-level radioactive substances and/or other materials

F-48



have been contained, disposed of or released. Some of these sites have been designated Superfund sites by EPA pursuant to CERCLA or stateequivalents. Similar environmental laws and regulations and other requirements exist in foreign countries in which the company operates.

22. Commitments

Lease Obligations and Purchase Obligations

The company has various commitments under noncancelable operating lease agreements, principally for railcars and productionequipment. Aggregate minimum annual rentals under all operating leases at December 31, 2004 are shown in the table below. Total rentalexpense was $17.4 million in 2004, $16.2 million in 2003 and $13.2 million in 2002.

In the normal course of business, the company enters into contractual agreements to purchase raw materials and utilities. Aggregatefuture payments under these contracts are shown in the table below.

Payments due by period

Type of Obligation 2005 2006 2007 2008 2009After

2009Total


Operating leases $ 6.1 $ 3.4 $ 3.1 $ 2.7 $ 2.6 $ 12.6 $ 30.5Purchase obligations�

Ore contracts 155.6 100.4 90.8 40.3 � � 387.1Other purchase obligations 91.7 74.9 65.7 18.2 13.1 33.2 296.8

Total $ 253.4 $ 178.7 $ 159.6 $ 61.2 $ 15.7 $ 45.8 $ 714.4

As discussed in Note 18, the company will be obligated under the Employee Benefits Agreement with Kerr-McGee to maintain theMaterial Features (as defined in the Employee Benefits Agreement) of the U.S. postretirement plan without change for a period of three yearsfollowing the Distribution date. Based on the actuarially projected obligations under that plan, the company expects contributions to be in therange of $12.0 to $16.0 million for each of the next three years.

Letters of Credit and Other

At December 31, 2004, the company had outstanding letters of credit in the amount of approximately $7.5 million. These letters of credithave been granted by financial institutions to support our environmental clean-up costs and severance requirements in international locations.

The company has entered into certain agreements that require it to indemnify third parties for losses related to environmental matters,litigation and other claims. No material obligations have been recorded in connection with such indemnification agreements.

As discussed in Notes 2 and 17, the company has obligations associated with the retirement of tangible long-lived assets. In addition toasset retirement obligations reflected in the company's Combined Balance Sheet, obligations exist for certain facilities that are not estimableuntil the timing of settlement is known and, therefore, have not been reflected in the accompanying financial statements.

F-49



23. Reporting by Business Segments and Geographic Locations

The company has two reportable segments: pigment, and electrolytic and other chemical products. The pigment segment primarilyproduces and markets titanium dioxide pigment and has production facilities in the United States, Australia, Germany and the Netherlands.The pigment segment also includes heavy minerals production operated through our joint venture. The heavy minerals production is integratedwith our Australian pigment plant but also has sales to third parties. Electrolytic and other chemical products segment represents thecompany's electrolytic manufacturing and marketing operations, all of which are located in the United States. Segment performance isevaluated using operating profit (loss), which represents results of segment operations before considering general expenses and environmentalprovisions related to sites no longer in operation, other income (expense) and income taxes.

2004 2003 2002


Net salesPigment $ 1,208.4 $ 1,078.8 $ 994.3Electrolytic and other chemical products 93.4 78.9 70.0

Total $ 1,301.8 $ 1,157.7 $ 1,064.3

Operating profit (loss)Pigment $ (86.5) $ (15.0) $ 23.5Electrolytic and other chemical products(1) (0.6) (22.0) (13.4)

(87.1) (37.0) 10.1

Expenses of nonoperating sites(2) (5.5) (3.6) (0.8)Provisions for environmental remediation and restoration(2) (2.2) (1.6) (4.1)

Total operating profit (loss) (94.8) (42.2) 5.2Other income (expense) (25.3) (20.6) (13.2)

Loss from continuing operations before income taxes $ (120.1) $ (62.8) $ (8.0)

Depreciation, depletion and amortization, including write-downs ofproperty, plant and equipment

Pigment $ 181.3 $ 110.3 $ 97.3Electrolytic and other chemical products 14.5 15.0 15.7

195.8 125.3 113.0

Discontinued operations 0.8 3.2 4.5

Total $ 196.6 $ 128.5 $ 117.5

(1)Includes nil, $11.0 million and $21.5 million in 2004, 2003 and 2002, respectively, of environmental charges, net of reimbursements,related to ammonium perchlorate at the company's Henderson facility.



(2)Includes general expenses and environmental provisions related to various businesses in which the company is no longer engaged, butthat have not met the criteria for reporting as discontinued operations.

F-50



2004 2003 2002


Capital expendituresPigment $ 82.8 $ 90.5 $ 78.4Electrolytic and other chemical products 9.0 6.9 6.9

91.8 97.4 85.3

Other 0.7 2.0 0.7Discontinued operations � � 0.7

Total $ 92.5 $ 99.4 $ 86.7

Total assetsPigment $ 1,349.8 $ 1,500.0 $ 1,412.9Electrolytic and other chemical products 115.4 140.4 158.7

1,465.2 1,640.4 1,571.6

Corporate and other assets 127.3 164.9 157.1Assets held for sale 3.4 3.8 4.9

Total $ 1,595.9 $ 1,809.1 $ 1,733.6

Net sales(1)

U.S. operations $ 716.8 $ 646.7 $ 602.8

International operationsGermany 221.9 192.0 171.0The Netherlands 137.5 120.9 110.6Australia 225.5 198.0 168.0Other 0.1 0.1 11.9

Total $ 1,301.8 $ 1,157.7 $ 1,064.3

Net property, plant and equipmentU.S. operations $ 487.3 $ 579.4 $ 596.4

International operationsGermany 97.1 89.2 73.3The Netherlands 205.6 191.4 165.0Australia 93.0 101.6 110.2

Total $ 883.0 $ 961.6 $ 944.9

(1)Based on country of production.



24. Subsequent Events (unaudited)

As discussed in Note 3, Tronox Worldwide LLC guaranteed certain of Kerr-McGee's notes upon their original issuance. OnSeptember 21, 2005, Kerr-McGee received a written consent to amend the indenture from noteholders representing approximately 90% of theaggregate outstanding principal amount of notes, for which Kerr-McGee agreed to pay the fees to consenting noteholders. Kerr-McGeeamended the indenture governing these notes to provide for the release of Tronox Worldwide LLC's guarantee of the notes upon completion ofan initial public offering, spin-off or split-off of the

F-51



company, its successor or its parent. Pursuant to the amended indenture, upon completion of this offering, Tronox Worldwide LLC will bereleased from its guarantee of the notes.

Prior to the completion of the offering, the company will enter into agreements with Kerr-McGee that will govern the separation of thebusinesses and various interim and ongoing relationships, including agreements with respect to the provision of interim services by Kerr-McGee to the company. Under the separation agreements, the company will transition $34.5 million of letters of credit that are outstanding atOctober 31, 2005 under Kerr-McGee's credit facility to the company's revolving credit facility that will be entered into concurrent with theoffering as discussed below.

Concurrent with the completion of the offering, Tronox Worldwide will enter into a senior secured credit facility consisting of a$200 million six-year term loan facility and a $250 million five-year multicurrency revolving credit facility. The credit facility will beguaranteed by Tronox Incorporated and Tronox Worldwide's direct and indirect material domestic subsidiaries (including Tronox FinanceCorp., a newly formed entity which consists solely of insignificant formation capital). Tronox Worldwide and Tronox Finance Corp. will alsobe offering $350 million in aggregate principal amount of unsecured notes due 2012 in a concurrent private offering. All of the net proceedsfrom the term loan facility and the unsecured notes will be distributed to Kerr-McGee.

In October 2005, Kerr-McGee completed the transfer of its ownership interest in certain European subsidiaries to Tronox Worldwide.

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TRONOX

CONDENSED COMBINED STATEMENT OF OPERATIONS

(UNAUDITED)

Nine Months Ended

September 30,

2005 2004

(Millions, except per share amounts)

Net sales $ 1,017.5 $ 939.9Cost of goods sold 847.6 844.0

Gross margin 169.9 95.9Selling, general and administrative expenses 85.9 80.2Restructuring charges � 112.1Provision for environmental remediation and restoration, net of reimbursements 17.0 3.6

67.0 (100.0)Other income (expense) (12.1) (20.0)

Income (Loss) from Continuing Operations before Income Taxes 54.9 (120.0)Income Tax Benefit (Provision) (20.5) 38.1

Income (Loss) from Continuing Operations 34.4 (81.9)Loss from Discontinued Operations, net of income tax benefit of$11.7 and $24.3, respectively

(21.8) (45.3)

Net Income (Loss) $ 12.6 $ (127.2)

Pro forma loss per common share (unaudited):Basic and diluted $ 0.55

Pro forma weighted average common shares outstanding (unaudited):Basic and diluted 22.9

Pro forma as if income taxes were presented on a stand-alone basis:Income from Continuing Operations before Income Taxes $ 54.9

Income Tax Provision (3.3)

Income from Continuing Operations 51.6Loss from Discontinued Operations (33.5)

Net Income $ 18.1


F-53



TRONOX

CONDENSED COMBINED BALANCE SHEET

(UNAUDITED)

September 30,

2005

December 31,

2004


ASSETSCurrent Assets

Cash and cash equivalents $ 76.7 $ 23.8Accounts receivable, net of allowance for doubtful accounts of $12.3 at September 30,2005 and $11.0 at December 31, 2004

303.9 222.2

Inventories 307.8 285.1Prepaid and other assets 35.1 34.4Income taxes receivable 0.6 12.7Deferred income taxes 38.4 17.9Assets held for sale � 3.4

Total Current Assets 762.5 599.5

Property, Plant and Equipment��Net 811.9 883.0Long-Term Receivables, Investments and Other Assets 67.7 48.3Goodwill and Other Intangible Assets 60.9 65.1

Total Assets $ 1,703.0 $ 1,595.9

LIABILITIES AND BUSINESS EQUITYCurrent Liabilities

Accounts payable $ 157.8 $ 196.0Income taxes payable 2.1 �

Accrued liabilities 143.5 163.3

Total Current Liabilities 303.4 359.3

Noncurrent LiabilitiesDeferred income taxes 97.7 101.2Environmental remediation and/or restoration 160.6 130.8Other 123.7 114.7

Total Noncurrent Liabilities 382.0 346.7

Contingencies (Note 10)



Business EquityOwner's net investment 979.0 818.6Accumulated other comprehensive income 38.6 71.3

Total Business Equity 1,017.6 889.9

Total Liabilities and Business Equity $ 1,703.0 $ 1,595.9


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TRONOX

CONDENSED COMBINED STATEMENT OF CASH FLOWS

(UNAUDITED)

Nine Months Ended

September 30,

2005 2004


Cash Flows from Operating ActivitiesNet income (loss) $ 12.6 $ (127.2)Adjustments to reconcile net income (loss) to net cash provided by operating activities�

Depreciation and amortization 78.1 76.9Deferred income taxes (22.9) (72.3)Asset write-downs and impairments 12.3 122.0Provision for environmental remediation and restoration, net of reimbursements 37.4 65.8Allocations from Kerr-McGee 35.2 36.3Other noncash items affecting net income (loss) 8.9 14.3Changes in assets and liabilities (148.6) (35.0)

Net cash provided by operating activities 13.0 80.8

Cash Flows from Investing ActivitiesCapital expenditures (51.7) (63.7)Collection on repurchased receivables 165.0 �

Other investing activities 4.9 0.6

Net cash provided by (used in) investing activities 118.2 (63.1)

Cash Flows from Financing ActivitiesNet transfers with affiliates (81.2) (40.2)

Net cash used in financing activities (81.2) (40.2)

Effects of Exchange Rate Changes on Cash and Cash Equivalents 2.9 0.3

Net Increase (Decrease) in Cash and Cash Equivalents 52.9 (22.2)Cash and Cash Equivalents at Beginning of Period 23.8 59.3

Cash and Cash Equivalents at End of Period $ 76.7 $ 37.1

Noncash Investing Activities

Receivables repurchased and contributed by Kerr-McGee $ 165.0 $ �



Noncash Financing Activities

Contribution of repurchased receivables by Kerr-McGee (165.0) �


F-55



TRONOX

CONDENSED COMBINED STATEMENT OF COMPREHENSIVE

INCOME (LOSS) AND BUSINESS EQUITY

(UNAUDITED)

Owner's

Net

Investment

Accumulated

Other

Comprehensive

Income

Total

Business

Equity


Balance at December 31, 2003 $ 946.7 $ 64.5 $ 1,011.2Comprehensive Loss:

Net loss (127.2) � (127.2)Other comprehensive loss � (5.1) (5.1)


Balance at September 30, 2004 $ 804.8 $ 59.4 $ 864.2

Balance at December 31, 2004 $ 818.6 $ 71.3 $ 889.9Comprehensive Income (Loss):

Net income 12.6 � 12.6Other comprehensive loss � (32.7) (32.7)

Comprehensive loss (20.1)Net transfers from Kerr-McGee 147.8 � 147.8

Balance at September 30, 2005 $ 979.0 $ 38.6 $ 1,017.6

The accompanying notes are an integral part of these statements

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TRONOX

NOTES TO CONDENSED COMBINED FINANCIAL STATEMENTS

SEPTEMBER 30, 2005

(UNAUDITED)

1. The Company, Basis of Presentation and Accounting Policies

The Company

The accompanying unaudited condensed combined financial statements reflect the combined financial position and combined results ofoperations of certain subsidiaries of Kerr-McGee Corporation ("Kerr-McGee"). In these combined financial statements, we refer to thosesubsidiaries collectively as "Tronox" or the "company." The company is primarily engaged in the global production and marketing of titaniumdioxide, a white pigment used in a wide range of products. Tronox has production facilities in the United States, Germany and theNetherlands, mining and production facilities in Australia, and a European marketing subsidiary in Switzerland. The company has in the pastoperated or held businesses or properties, or currently holds properties, that do not relate to the current chemical business.

On March 8, 2005, Kerr-McGee's Board of Directors authorized Kerr-McGee's management to pursue alternatives for the separation ofthe company, including through a spin-off, split-off or sale. On May 17, 2005, Tronox Incorporated, an indirect wholly-owned subsidiary ofKerr-McGee, was formed in Delaware to effect that separation. Prior to the closing of this offering, the company will be contributed andtransferred to Tronox Incorporated. Kerr-McGee has announced that after completion of this offering it intends to distribute its remainingownership interest in Tronox Incorporated to its common stockholders (the "Distribution"). Kerr-McGee expects to accomplish thisDistribution through a spin-off, split-off or a combination of both transactions. Kerr-McGee has the sole discretion to decide if and when theDistribution will occur and to determine the form, the structure and all other terms of any transactions to effect the Distribution.


The accompanying unaudited condensed combined financial statements have been prepared by the company, pursuant to the rules andregulations of the Securities and Exchange Commission (SEC) and, in the opinion of management, include all adjustments, consisting only ofadjustments that are normal and recurring in nature, necessary to a fair statement of the results for the interim periods presented. Certaininformation and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generallyaccepted in the United States have been condensed or omitted pursuant to such rules and regulations. Although the company believes that thedisclosures are adequate to make the information presented not misleading, these condensed financial statements should be read in conjunctionwith the annual combined financial statements and the notes thereto included elsewhere in this Registration Statement.

Accounting Policies

Employee Stock-Based Compensation�Certain of the company's employees participated in Kerr-McGee's long-term incentive plans.Under the plans, employees received various stock-based compensation awards, including stock options, restricted stock, stock opportunitygrants and performance units. The company accounts for such awards under the intrinsic-value method of Accounting Principles BoardOpinion No. 25, "Accounting for Stock Issued to Employees." This method of accounting for stock options generally results in no expensebeing recognized for fixed-price

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stock options with an exercise price equal to the fair value of the stock on the grant date. Compensation expense for restricted stock and stockopportunity grants was measured at the market price of the shares of Kerr-McGee stock on the grant date and is being amortized ratably overthe three-year vesting period of the underlying grants or over the service period, if shorter.

The Financial Accounting Standards Board Statement No. 123, "Accounting for Stock-Based Compensation," prescribes a fair-valuemethod of accounting for employee stock-based awards. Following this method, compensation expense for such awards is measured based onthe estimated grant-date fair value and recognized as the related employee services are provided. If compensation expense for stock-basedawards had been determined using the fair-value based method, stock-based compensation expense would have increased, as shown in thefollowing table.

Pro forma compensation expense presented below is associated with awards granted to employees of the company and does not reflectpro forma amounts associated with Kerr-McGee employees currently performing corporate and administrative functions for the company thatmay become employees of the company at the time of the spin-off.

Nine Months Ended

September 30,

2005 2004


Net income (loss), as reported $ 12.6 $ (127.2)Add: stock-based employee compensation expense included in reported netincome (loss), net of taxes

1.4 1.3

Deduct: stock-based employee compensation expense using a fair-valuemethod, net of taxes

(2.3) (2.9)

Pro forma net income (loss) $ 11.7 $ (128.8)

Pro forma basic and diluted income per common share (unaudited):As reported $ 0.55Pro forma 0.51

The fair value of each Kerr-McGee option granted in 2005 and 2004 was estimated as of the grant date using the Black-Scholes optionpricing model with the following weighted-average assumptions:

Assumptions

Risk-Free

Interest Rate

Expected

Dividend Yield

Expected

Life (years)

Expected

Volatility

Weighted-Average

Fair Value of

Options Granted

2005 3.9% 3.5% 6.0 27.4%$ 12.502004 3.5 3.6 5.8 22.6 8.63

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2. Transactions with Kerr-McGee

The interim Condensed Combined Statement of Operations includes allocation of costs for certain corporate functions historicallyprovided by Kerr-McGee, including:

General Corporate Expenses�Represents costs related to corporate functions such as accounting, tax, treasury, human resources, legaland information management and technology. These costs have historically been allocated primarily based on estimated use of services ascompared to Kerr-McGee's other businesses. These costs are included in selling, general and administrative expenses in the interimCondensed Combined Statement of Operations.

Employee Benefits and Incentives�Represents fringe benefit costs and other incentives, including group health and welfare benefits,U.S. pension plans, U.S. postretirement benefit plans, and stock-based compensation plans. These costs have historically been allocated on anactive headcount basis for health and welfare benefits, including postretirement benefits, on the basis of salary for U.S. pension plans, and on aspecific identification basis for stock-based compensation plans. These costs are included in costs of goods sold and selling, general andadministrative expenses in the interim Condensed Combined Statement of Operations.

Interest Expense�Kerr-McGee has provided financing to the company through cash flows from its other operations and debt incurred.Although the incurred debt has not been allocated to the company, a portion of the interest expense has been allocated based on specifically-identified borrowings at Kerr-McGee's average borrowing rates. These costs are included in other income (expense) in the interim CondensedCombined Statement of Operations, net of interest income that has been allocated from the company to Kerr-McGee on certain monies thecompany has loaned to Kerr-McGee.

Expense allocations from Kerr-McGee reflected in income (loss) from continuing operations in the company's interim CondensedCombined Statement of Operations were as follows:

Nine Months Ended September 30,

2005 2004


General corporate expenses $ 20.3 $ 20.7Employee benefits and incentives 17.9 20.8Interest expense, net 12.5 8.4

These allocations were based on what Kerr-McGee considered to be reasonable reflections of the historical utilization levels of theservices required in support of our business and may be less than the expenses we will incur in the future as a stand-alone company. Thecompany's management currently estimates that general corporate expenses may be $20.0 to $25.0 million greater on an annual basis in thefuture as a stand-alone company.

Kerr-McGee utilizes a worldwide centralized approach to cash management and the financing of its operations with all related activitybetween Kerr-McGee and the company reflected as net transfers from (to) Kerr-McGee in the company's Condensed Combined Statement ofComprehensive Income (Loss) and Business Equity. Under the terms of the master separation agreement with Kerr-McGee, the net amountdue from the company to Kerr-McGee at the closing date of this offering, will remain

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classified as equity forming a part of the continuing equity of the company. Subsequent to the closing of this offering, amounts due from or toKerr-McGee arising from transactions subsequent to that date will be settled in cash. We intend to distribute all of the net proceeds from thisoffering to Kerr-McGee.

Kerr-McGee issued $1.5 billion of long-term notes in a public offering in 2001 and $650 million of long-term notes in 2004. These noteshave been fully and unconditionally guaranteed, on a joint and several basis, by Tronox Worldwide LLC and another Kerr-McGee subsidiary.On September 21, 2005, Kerr-McGee received a written consent to amend the indenture from noteholders representing approximately 90% ofthe aggregate outstanding principal amount of the notes, for which Kerr-McGee agreed, as the benefiting party, to pay the fees to consentingnoteholders. Kerr-McGee amended the indenture governing these notes to provide for the release of Tronox Worldwide LLC's guarantee ofthe notes upon completion of an initial public offering, spin-off or split-off of the company, its successor or its parent. Pursuant to theamended indenture, upon completion of this offering, Tronox Worldwide LLC will be released from its guarantee of the notes.

3. Comprehensive Income (Loss)

Comprehensive income (loss) for the nine months ended September 30, 2005 and 2004, was as follows:

Nine Months Ended September

30,

2005 2004


Net income $ 12.6 $ (127.2)After-tax changes in:Deferred gain (loss) on cash flow hedges 5.9 (2.8)Foreign currency translation adjustments (38.8) (2.3)Minimum pension liability adjustments 0.2 �

Comprehensive income (loss) $ (20.1) $ (132.3)

4. Derivative Instruments

At September 30, 2005 and December 31, 2004, the net fair value of foreign currency and commodity hedging contracts included in theCondensed Combined Balance Sheet was an asset of $7.0 million and a liability of $1.6 million, respectively, and the related balance ofdeferred after-tax gains (losses) in accumulated other comprehensive income was $4.7 million and $(1.2) million, respectively. All contractsoutstanding at September 30, 2005 are expected to settle within the next twelve months. Pretax gains on cash flow hedges of $0.3 million, and$8.0 million, for the first nine months of 2005 and 2004, respectively, were reclassified from accumulated other comprehensive income toearnings. Substantially all of such gains are reflected as a component of cost of goods sold in the Condensed Combined Statement ofOperations. No hedges were discontinued and no ineffectiveness was recognized in the periods presented.

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5. Accounts Receivable Sales

Through April 2005, the company had an accounts receivable monetization program with a maximum availability of $165.0 million.Under the terms of the program, selected qualifying customer accounts receivable were sold monthly to a special-purpose entity (SPE), whichin turn sold an undivided ownership interest in the receivables to a third-party multi-seller commercial paper conduit sponsored by anindependent financial institution. As the receivables were sold, such amounts were reflected as cash flows from operating activities within theCombined Statement of Cash Flows. The company sold, and retained an interest in, excess receivables to the SPE as over-collateralization forthe program. The retained interest in sold receivables was subordinate to, and provided credit enhancement for, the conduit's ownershipinterest in the SPE's receivables, and was available to the conduit to pay certain fees or expenses due to the conduit, and to absorb credit lossesincurred on any of the SPE's receivables in the event of program termination. No recourse obligations were recorded since the company hadno obligations for any recourse actions on the sold receivables. At December 31, 2004, the outstanding balance of receivables sold (andexcluded from the company's Condensed Combined Balance Sheet as of that date) was $165.0 million, which was net of the company'sretained interest in receivables serving as over-collateralization of $38.8 million. The company sold $384.1 million and $837.9 million of itspigment receivables during the first nine months of 2005 and 2004, respectively, and had pretax income (loss) of $0.2 million and ($5.8)million in each of those periods. In 2005, the company recognized $4.2 million pretax income representing a return of estimated feespreviously paid in excess of actual costs incurred.

The accounts receivable monetization program included ratings downgrade triggers based on Kerr-McGee's corporate senior unsecureddebt rating that provided for certain program modifications, including a program termination event upon which the program would effectivelyliquidate over time and the third-party multi-seller commercial paper conduit would be repaid with the collections on accounts receivable. InApril 2005, Kerr-McGee's senior unsecured debt was downgraded, triggering program termination. As opposed to liquidating the programover time in accordance with its terms, Kerr-McGee entered into an agreement to terminate the program by repurchasing the then outstandingbalance of receivables sold of $165.0 million, which were then contributed to the company. The balances of repurchased receivables havesubsequently been collected by the company. Such collections are included in cash flows from investing activities in the CondensedCombined Statement of Cash Flows.

In the Condensed Combined Statement of Cash Flows for the six months ended June 30, 2005 included in Amendment No. 3 to theregistration statement, the company classified collections on repurchased receivables of $152.9 million as a component of net cash providedby operating activities. The company subsequently determined that a more appropriate classification for collections on repurchasedreceivables is as a component of net cash flows from investing activities and such collections of $165 million are classified as such in theaccompanying Condensed Combined Statement of Cash Flows for the nine months ended September 30, 2005. The effect of this change in

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classification on the Condensed Combined Statement of Cash Flows for the six months ended June 30, 2005, is as follows (in millions):

As Previously

PresentedReclassification As Restated

Net cash provided by (used in) operating activities $ 126.5 $ (152.9) $ (26.4)Net cash provided by (used in) investing activities $ (30.5) $ 152.9 $ 122.4

6. Inventories

Major categories of inventories at September 30, 2005 and December 31, 2004 were as follows:

September 30,

2005

December 31,

2004


Raw materials $ 79.2 $ 79.5Work in progress 16.0 13.4Finished goods 150.9 135.6Materials and supplies 61.7 56.6

Total $ 307.8 $ 285.1

7. Discontinued Operations, Restructuring and Exit Activities

Restructuring and Exit Activities�The following table presents a reconciliation of the beginning and ending balances of reserves forrestructuring and exit activities for the nine months ended September 30, 2005. No significant changes in the status of such activities occurredduring this period.

Dismantlement and

Closure

Personnel

CostsTotal


Balance at December 31, 2004 $ 10.4 $ 7.1 $ 17.5Payments (2.0) (2.1) (4.1)Adjustments (2.1) (1.2) (3.3)


In September 2004, the company shut down its titanium dioxide pigment sulfate production at the Savannah, Georgia facility. Included inthe restructuring charges in 2004 was $86.2 million of asset write-downs taken in the form of accelerated depreciation for plant assets,$7.4 million for impairment of intangible assets, $6.5 million for severance and benefit plan curtailment costs and $6.6 million for otherclosure costs. The company also recognized an additional $5.4 million of costs in 2004 in connection with the closure of the synthetic rutileplant in Mobile, Alabama. The shutdown of the sulfate production at the Savannah facility also resulted in an inventory revaluation charge of$15.6 million included in cost of goods sold in 2004.

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Discontinued Operations�In 2004, the company's forest products operations met the criteria for reporting as discontinued operations.Revenues and pretax loss applicable to discontinued forest products operations for the nine months ended September 30, 2005 and 2004 wereas follows:

2005 2004


Revenues $ 0.2 $ 18.1Loss before income taxes (17.5) (13.9)

In addition to the company's forest products operations, losses from discontinued operations for all periods presented include adjustmentsto amounts previously reported as discontinued operations upon disposition of the company's thorium manufacturing, uranium and refiningoperations. These adjustments resulted primarily from changes in estimated cost of environmental remediation and restoration activitiesdirectly related to the disposed operations. Disposals of the company's uranium and refining operations were completed in 1989 and 1995,respectively. The company ceased operations at its West Chicago thorium facility in 1973. The company retained certain environmentalremediation obligations and continues remediation activities directly related to these former operations, as more fully discussed in Note 10.

8. Employee Stock-Based Compensation and Benefit Plans

Employee Stock-Based Compensation�In January 2005, annual stock-based compensation awards were granted to eligible employees ofthe company under the Kerr-McGee's long-term incentive plan. The awards to the company's employees included approximately 25,000shares of restricted stock, 6,000 shares of stock opportunity awards, 137,000 stock options and 1.2 million performance units that provide forcash awards based on Kerr-McGee's achievement of certain financial performance measures over a stated period. This grant activity does notinclude grants made to Kerr-McGee employees currently performing corporate and administrative functions for the company that may becomeemployees of the company at the time of the spin-off. The aggregate fair value of the restricted stock and stock opportunity awards on thegrant date was $1.7 million, which will be recognized as compensation expense (net of forfeitures) as the employee services are provided. Theexercise price of the options granted of $56.57 per share of Kerr-McGee stock equaled the fair value of the underlying stock on the date ofgrant, and therefore, the grant did not result in compensation expense.

Kerr-McGee stock-based awards outstanding at the date of the Distribution, except for vested stock options and performance unit awards,will be automatically converted into the company's stock-based awards using a conversion ratio determined consistent with the provisions ofthe Employee Benefits Agreement between the company and Kerr-McGee. Employees who hold vested options to purchase Kerr-McGeecommon stock as of the date of the Distribution may exercise such options for the lesser of three months after the effective date of theDistribution or the remaining term of the option award. However, employees who are eligible for retirement on the effective date of theDistribution may exercise their vested stock options for the lesser of four years after the effective date of the Distribution or the remainingterm of the option award. Vested options not exercised during the specified time period will expire.

Unvested performance unit awards held by the company's employees as of the date of the Distribution will be forfeited. The companywill provide a stock option or restricted stock grant equal to the value of the forfeited awards. The value will be determined by calculatingtotal shareholder return and associated payout as if the entire performance cycle ended on the date of the offering.

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Benefit Plans�Net periodic pension cost for the company's foreign retirement plans for the nine months ended September 30, 2005 and2004 was $2.4 million and $1.9 million, respectively.

Kerr-McGee allocates costs associated with its U.S. retirement and postretirement plans based on salary for defined benefit pension plansand based on active headcount for postretirement plans. Net periodic cost (benefit) associated with Kerr-McGee's U.S. plans allocated to thecompany during the nine month periods ended September 30, 2005 and 2004 was as follows:

Nine Months Ended September 30,

2005 2004


U.S. retirement plans $ (0.3) $ (1.6)U.S. postretirement plans 5.3 8.7

The 2004 period includes curtailment loss and special termination benefits associated with the shutdown of sulfate production at theSavannah, Georgia facility.

The costs that have historically been allocated to the company are not necessarily indicative of the costs that will be incurred in the futureby the company for U.S. benefit plans. The table above only includes costs associated with active and inactive employees of the company'sdomestic chemical business and does not include any amount for Kerr-McGee corporate employees that may become employees of Tronoxafter the spin-off.

9. Other Income (Expense)

Components of other income (expense) for the nine months ended September 30, 2005 and 2004 were as follows:

Nine Months Ended

September 30,

2005 2004


Net foreign currency transaction gain (loss) $ (1.8) $ (7.0)Interest expense, net (10.9) (6.6)Gain (loss) on accounts receivable sales 0.2 (5.8)Other income (expense) 0.4 (0.6)

Total $ (12.1) $ (20.0)

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10. Contingencies

The following table summarizes the contingency reserve balances, provisions, payments and settlements for the nine months endedSeptember 30, 2005, as well as balances, accruals and receipts of environmental cost reimbursements from other parties.

Reserves for

Litigation

Reserves for

Environmental

Remediation(1)

Reimbursements

Receivable(1)


Balance at December 31, 2004 $ 2.6 $ 215.8 $ 93.8Provisions/Accruals � 66.0 28.6Payments/Settlements (0.2) (42.4) (69.9)


(1)Provision for environmental remediation includes $28.0 million related to the company's former forest products operations, thoriummanufacturing, uranium and refining operations. Accrual of reimbursements receivable includes $7.6 million related to the company'sformer thorium manufacturing operations. These charges are reflected in the Condensed Combined Statement of Operations as acomponent of loss from discontinued operations (net of taxes).

Management believes, after consultation with its internal legal counsel, that currently the company has reserved adequately for thereasonably estimable costs of environmental matters and other contingencies. However, additions to the reserves may be required as additionalinformation is obtained that enables the company to better estimate its liabilities, including liabilities at sites now under review, though thecompany cannot now reliably estimate a range of future additions to the reserves for any individual site or for all sites collectively. Followingare discussions regarding certain environmental sites and litigation. Reserves for each environmental site are based on assumptions regardingthe volumes of contaminated soils and groundwater involved, as well as associated excavation, transportation and disposal costs.

The company provides for costs related to contingencies when a loss is probable and the amount is reasonably estimable. It is notpossible for the company to reliably estimate the amount and timing of all future expenditures related to environmental and legal matters andother contingencies because, among other reasons:



�� cleanup requirements are difficult to predict at sites where remedial investigations have not been completed or final decisionshave not been made regarding cleanup requirements, technologies or other factors that bear on cleanup costs;

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�� environmental laws frequently impose joint and several liability on all potentially responsible parties, and it can be difficult todetermine the number and financial condition of other potentially responsible parties and their respective shares ofresponsibility for cleanup costs;

�� environmental laws and regulations, as well as enforcement policies, are continually changing, and the outcome of courtproceedings and discussions with regulatory agencies are inherently uncertain;

�� some legal matters are in the early stages of investigation or proceeding or their outcomes otherwise may be difficult topredict, and other legal matters may be identified in the future;

�� unanticipated construction problems and weather conditions can hinder the completion of environmental remediation; theinability to implement a planned engineering design or use planned technologies and excavation methods may requirerevisions to the design of remediation measures, resulting in delayed remediation and increased costs; and the identification ofadditional areas or volumes of contamination and changes in costs of labor, equipment and technology generate correspondingchanges in environmental remediation costs.

Environmental

Henderson, Nevada

In 1998, Tronox LLC (formerly Kerr-McGee Chemical LLC) decided to exit the ammonium perchlorate business. At that time, TronoxLLC curtailed operations and began preparation for the shutdown of the associated production facilities in Henderson, Nevada, that producedammonium perchlorate and other related products. Manufacture of perchlorate compounds began at Henderson in 1945 in facilities owned bythe U.S. government. The U.S. Navy expanded production significantly in 1953 when it completed construction of a plant for the manufactureof ammonium perchlorate. The Navy continued to own the ammonium perchlorate plant as well as other associated production equipment atHenderson until 1962, when the plant was purchased by a predecessor of the company. The ammonium perchlorate produced at the Hendersonfacility was used primarily in federal government defense and space programs. Perchlorate that may have originated, at least in part, from theHenderson facility has been detected in nearby Lake Mead and the Colorado River, which contribute to municipal water supplies in Arizona,Southern California and Southern Nevada.

Tronox LLC began decommissioning the facility and remediating associated perchlorate contamination, including surface impoundmentsand groundwater, when it decided to exit the business in 1998. In 1999 and 2001, Tronox LLC entered into consent orders with the NevadaDivision of Environmental Protection (NDEP) that requires it to implement both interim and long-term remedial measures to capture andremove perchlorate from groundwater. In April 2005, Tronox LLC entered into an amended consent order with NDEP that requires, inaddition to the capture and treatment of groundwater, the closure of a certain impoundment related to the past production of ammoniumperchlorate, including treatment and disposal of solution and sediment contained in the impoundment.

In 1999, Tronox LLC initiated the interim measures required by the consent orders. A long-term remediation system is operating incompliance with the consent orders. Initially, the remediation system

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was projected to operate through 2007. However studies of the decline of perchlorate levels in the groundwater indicate that Tronox LLC mayneed to operate the system through 2011. The scope, duration and cost of groundwater remediation ultimately will be driven in the long termby drinking water standards regarding perchlorate, which to date have not been formally established by applicable state or federal regulatoryauthorities. The Environmental Protection Agency (EPA) and other federal and state agencies continue to evaluate the health andenvironmental risks associated with perchlorate as part of the process for ultimately setting drinking water standards. One state agency, theCalifornia Environmental Protection Agency (CalEPA), has set a public health goal for perchlorate, and the federal EPA has established areference dose for perchlorate, which are preliminary steps to setting drinking water standards. The establishment of drinking water standardscould materially affect the scope, duration and cost of the long-term groundwater remediation that Tronox LLC is required to perform.

Financial Reserves�As of September 30, 2005, reserves for environmental remediation at Henderson totaled $38.7 million. This includes$32.3 million added to the reserve for the nine months ended September 30, 2005, because of increased costs for removing and treatingammonium perchlorate solids contained in a lined pond and purchasing additional equipment to perform clean-up. As noted above, the long-term scope, duration and cost of groundwater remediation and impoundment closure are uncertain and, therefore, additional costs beyondthose accrued may be incurred in the future. However, the amount of any additional costs cannot be reasonably estimated at this time.

Litigation�In 2000, Tronox LLC initiated litigation against the United States seeking contribution for its Henderson response costs. Thesuit is based on the fact that the government owned the plant in the early years of its operation, exercised significant control over production atthe plant and the sale of products produced at the plant, even while not the owner, and was the largest consumer of products produced at theplant. The discovery stage of litigation is complete, and the parties are engaged in settlement negotiations. Although the outcome of thelitigation is uncertain, the company believes it is likely to recover a portion of its costs from the government. The amount and timing of anyrecovery cannot be estimated at this time and, accordingly, the company has not recorded a receivable or otherwise reflected in the financialstatements any potential recovery from the government.

Insurance�In 2001, Tronox LLC purchased a 10-year, $100 million environmental cost cap insurance policy for groundwater and otherremediation at Henderson. The insurance policy, which began to provide coverage only after Tronox LLC exhausted a self-insured retentionof approximately $61.3 million, covers only those costs incurred to achieve a cleanup level specified in the policy. As noted above, federaland state agencies have not established a drinking water standard and, therefore, it is possible that Tronox LLC may be required to achieve acleanup level more stringent than that covered by the policy. If so, the amount recoverable under the policy may be less than the ultimatecleanup cost.

At September 30, 2005, the company had received $4.3 million of cost reimbursement under the insurance policy, and expects additionalestimated aggregate cleanup costs of $93.1 million less the $61.3 million self-insured retention to be covered by the policy (for a net amountof $31.8 million in additional reimbursement, including $21.0 million accrued in the nine months ended September 30,

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2005). The company believes that additional reimbursement of approximately $31.8 million is probable, and, accordingly, the company hasrecorded a receivable in the financial statements for that amount.

West Chicago, Illinois

In 1973, Tronox LLC closed a facility in West Chicago, Illinois, that processed thorium ores for the federal government and for certaincommercial purposes. Historical operations had resulted in low-level radioactive contamination at the facility and in surrounding areas. Theoriginal processing facility is regulated by the State of Illinois (the State), and four vicinity areas are designated as Superfund sites on theNational Priorities List (NPL).

Closed Facility�Pursuant to agreements reached in 1994 and 1997 among Tronox LLC, the City of West Chicago (the City) and the Stateregarding the decommissioning of the closed West Chicago facility, Tronox LLC has substantially completed the excavation of contaminatedsoils and has shipped those soils to a licensed disposal facility. Surface restoration was completed in 2004, except for areas designated for usein connection with the Kress Creek and Sewage Treatment Plant remediation discussed below. Groundwater monitoring and remediation isexpected to continue for approximately ten years.

Vicinity Areas�EPA has listed four areas in the vicinity of the closed West Chicago facility on the NPL and has designated Tronox LLCas a Potentially Responsible Party (PRP) in these four areas. Tronox LLC has substantially completed remedial work for two of the areas(known as the Residential Areas and Reed-Keppler Park). The other two NPL sites, known as Kress Creek and the Sewage Treatment Plant,are contiguous and involve low levels of insoluble thorium residues, principally in streambanks and streambed sediments, virtually all within afloodway. Tronox LLC has reached an agreement with the appropriate federal and state agencies and local communities regarding thecharacterization and cleanup of the sites, past and future government response costs, and the waiver of natural resource damages claims. Theagreement is incorporated in consent decrees, which were approved and entered by the federal court in August 2005. The cleanup work, whichis expected to take about four to five years to complete, will require excavation of contaminated soils and stream sediments, shipment ofexcavated materials to a licensed disposal facility and restoration of affected areas.

Financial Reserves�As of September 30, 2005, the company had reserves of $97.0 million for costs related to the West Chicago facilityand vicinity properties. This includes $9.9 million added to the reserve for the nine months ended September 30, 2005. Although actual costsmay differ from current estimates, the amount of any revisions in remediation costs cannot be reasonably estimated at this time. The amountof the reserve is not reduced by reimbursements expected from the federal government under Title X of the Energy Policy Act of 1992 (TitleX) (discussed below).

Government Reimbursement�Pursuant to Title X, the U.S. Department of Energy (DOE) is obligated to reimburse the company forcertain decommissioning and cleanup costs incurred in connection with the West Chicago sites in recognition of the fact that about 55% of thefacility's production was dedicated to U.S. government contracts. The amount authorized for reimbursement under Title X is $365 million plusinflation adjustments. That amount is expected to cover the

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government's full share of West Chicago cleanup costs. Through September 30, 2005, the company had been reimbursed approximately$280.7 million under Title X.

Reimbursements under Title X are provided by congressional appropriations. Historically, congressional appropriations have lagged thecompany's cleanup expenditures. As of September 30, 2005, the government's share of costs incurred by the company but not yet reimbursedby the DOE totaled approximately $20.7 million, which includes $7.6 million accrued in the nine months ended September 30, 2005. Thecompany believes receipt of the $20.7 million government share in due course following additional congressional appropriations is probableand has reflected that amount as a receivable in the financial statements. The company will recognize recovery of the government's share offuture remediation costs for the West Chicago sites as it incurs the cash expenditures.


From the late 1950s until 1988, the company operated a uranium mining and milling operation at Ambrosia Lake near Grants, NewMexico, pursuant to a license issued by the Atomic Energy Commission (AEC) (now the Nuclear Regulatory Commission (NRC)). When theoperation was sold, the company retained responsibility for certain environmental conditions existing at the site, including mill tailings,selected ponds and groundwater contamination related to the mill tailings and unlined ponds. Since 1989, the unaffiliated current owner of thesite has been decommissioning the site pursuant to the license issued by NRC. Mill tailings, certain impacted surface soils, and selected pondsediments have been consolidated in an onsite containment unit, and groundwater treatment has been ongoing. Under terms of the salesagreement, which included provisions capping the liability of the current owner, the company became obligated to solely fund the remediationfor the items described above when total expenditures exceeded $30 million, which occurred in late 2000. A request to cease groundwatertreatment has been under review by the NRC since 2001. In addition, a decommissioning plan for remaining impacted soil was submitted bythe current owner to the NRC in January 2005 and is currently under review. If approved, the soil decommissioning plan would take two tothree years to complete. The State of New Mexico has recently raised issues about certain non-radiological constituents in the groundwater atthe site. The request to cease groundwater treatment, which is being reviewed by the NRC, was amended to address these non-radiologicalconstituents. Discussions regarding these issues are ongoing, and resolution of them could affect remediation costs and/or delay ultimate siteclosure. In addition to those remediation activities described above for which reserves have been established as described below, the currentowner is investigating soil contamination potentially caused by past discharge of mine water from the site, for which no reserve has beenestablished.

Financial Reserves�As of September 30, 2005, the company had reserves of $12.6 million for the costs of the remediation activitiesdescribed above, including groundwater remediation. This includes $8.0 million added to the reserve for the nine months ended September 30,2005, as a result of the discussions between the current owner and the NRC, and primarily to cover additional costs associated with pondclosure, rock placement, and surface water channels. Although actual costs may differ from current estimates, the amount of any revisions inremediation costs cannot be reasonably estimated at this time.

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Crescent, Oklahoma

Beginning in 1965, Cimarron Corporation ("Cimarron") operated a facility near Crescent, Oklahoma at which it produced uranium andmixed oxide nuclear fuels pursuant to licenses issued by AEC (now NRC). Operations at the facility ceased in 1975. Since that time, buildingsand soils were decommissioned in accordance with the NRC licenses. In limited areas of the site, groundwater is contaminated withradionuclides, and, in 2003, Cimarron submitted to the NRC and the Oklahoma Department of Environmental Quality (ODEQ) a draftremediation work plan addressing the groundwater contamination. It is anticipated that during 2005 the company will begin evaluatingavailable technologies and will submit a final plan to the NRC and the ODEQ addressing remaining groundwater issues following theevaluation. Duration of remedial activities currently cannot be estimated.

Financial Reserves�As of September 30, 2005, the company had reserves of $7.4 million for the costs of the remediation activities,including those currently under evaluation, described above. This includes $2.0 million added to the reserve for the nine months endedSeptember 30, 2005, due to additional costs resulting from delays in review and approval by regulatory agencies. Although actual costs maydiffer from current estimates, the amount of any revisions in remediation costs cannot be reasonably estimated at this time.

Lakeview, Oregon

A predecessor of Tronox Worldwide LLC operated two uranium mines near Lakeview, Oregon from 1958 to 1960. The mines arecurrently designated as a Superfund site. In 2001, EPA issued a Record of Decision (ROD) requiring consolidation and capping ofcontaminated soils and continued neutralization of acidic waters in one of the two mines. It is anticipated that required work, which began inthe second quarter of 2005, will take about two to three more years to complete.

Litigation�In April 2005, Tronox Worldwide LLC and two other parties reached an agreement in principle with the federal governmentto settle a lawsuit filed by the government with respect to the remediation of contaminated materials at the site and to settle related claims bythe parties. The suit sought reimbursement of Forest Service response costs, an injunction requiring compliance with a UnilateralAdministrative Order issued to the private parties regarding cleanup of the site, and civil penalties for alleged noncompliance with theadministrative order. As a result of the settlement, the parties have resolved their respective claims and agreed to apportion responsibility forthe cleanup.

Financial Reserves�As of September 30, 2005, the company had reserves of $2.1 million for the costs of the remediation activitiesdescribed above. Although actual costs may differ from current estimates, the amount of any revisions in remediation costs cannot bereasonably estimated at this time.

Soda Springs, Idaho

From 1963 to 2000, Tronox LLC owned and operated a vanadium processing facility near Soda Springs, Idaho. In 1989, EPA designatedthis site as a Superfund site under the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA), listed the site onthe NPL and named Tronox LLC as a PRP. In 2000, EPA amended a ROD previously issued by it, requiring Tronox

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LLC to address the presence of calcine tailings, a byproduct of vanadium processing. The amended ROD required the capping of the calcinetailings in place and the closure of certain impoundments.

Since 2000, the vanadium processing facility plant and a fertilizer plant on the site have been closed, dismantled and removed from thesite. All former impoundments included in the amended ROD have been closed. A ten-acre pond not covered by the ROD is scheduled forclosure within the next two years. Tronox LLC anticipates constructing a landfill onsite as part of the closure.

Financial Reserves�As of September 30, 2005, the company had reserves of $2.7 million for the costs of the remediation required by theROD as well as closure of the above mentioned ten-acre pond. Although actual costs may differ from current estimates, the amount of anyrevisions in remediation costs cannot be reasonably estimated at this time.


In 1976, Tronox LLC closed a wood-treatment facility it had operated in Milwaukee, Wisconsin. Operations at the facility prior to itsclosure had resulted in the contamination of soil and groundwater at and around the site with creosote and other substances used in woodtreating. In 1984, EPA designated the Milwaukee wood-treatment facility as a Superfund site under CERCLA, listed the site on the NPL andnamed Tronox LLC as a PRP. Tronox LLC executed a consent decree in 1991 that required it to perform soil and groundwater remediation atand below the former wood-treatment area and to address a tributary creek of the Menominee River that had become contaminated as a resultof the wood-treatment operations. Actual remedial activities were deferred until after the decree was finally entered in 1996 by a federal courtin Milwaukee.

Groundwater treatment was initiated in 1996 to remediate groundwater contamination below and in the vicinity of the former wood-treatment area. It is not possible to reliably predict how groundwater conditions will be affected by soil removal in the vicinity of the formerwood-treatment area, which has been completed, and by ongoing groundwater treatment. It is unknown, therefore, how long groundwatertreatment will continue. Soil cleanup of the former wood-treatment area began in 2000 and was completed in 2002. Also in 2002, remedialdesigns for the upper portion of the tributary creek were agreed to with EPA, after which Tronox LLC began the implementation of a remedyto reroute the creek and to remediate associated sediment and stream bank soils. Remediation of the upper portion of the creek is expected totake about three more years. Tronox LLC has not yet agreed with relevant regulatory authorities regarding remedial designs for the lowerportion of the tributary creek.

Financial Reserves�As of September 30, 2005, the company had reserves of $5.4 million for the costs of the remediation work describedabove. Although actual costs may differ from current estimates, the amount of any revisions in remediation costs cannot be reasonablyestimated at this time. The costs associated with remediation, if any, of the lower portion of the tributary creek are not reasonably estimable.


Tronox LLC was named in 1999 as a PRP under CERCLA at a former wood-treatment site in New Jersey at which EPA is conducting acleanup. On April 15, 2005, Tronox LLC and Kerr-McGee

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received a letter from EPA asserting that they are liable under CERCLA as a former owner or operator of the site and demandingreimbursement of costs expended by EPA at the site. The demand is for payment of past costs in the amount of approximately $179 million,plus interest. Tronox LLC did not operate the site, which had been sold to a third party before Tronox LLC succeeded to the interests of apredecessor owner in the 1960's. The predecessor also did not operate the site, which had been closed down before it was acquired by thepredecessor. Based on historical records, there are substantial uncertainties about whether or under what terms the predecessor assumedliabilities for the site. In addition, although it appears there may be other PRPs, the company does not know whether the other PRPs havereceived similar letters from EPA, whether there are any defenses to liability available to the other PRPs or whether any other PRPs have thefinancial resources necessary to meet their obligations. The company intends to vigorously defend against EPA's demand. No reserve forreimbursement of cleanup costs at the site has been recorded because it is not possible to reliably estimate the liability, if any, the companymay have for the site because of the aforementioned defenses and uncertainties.

Sauget, Illinois

From 1927 to 1969, Tronox LLC operated a wood-treatment plant on a 60-acre site in the Village of Sauget (formerly known asMonsanto) in St. Clair County, Illinois. Operations on the property resulted in the contamination of soil, surface water, and groundwater at thesite with creosote and other substances used in wood treating. In 1988, Tronox LLC entered into a court-approved consent order with theIllinois Attorney General and Illinois Environmental Protection Agency. The consent order requires Tronox LLC to perform an environmentalinvestigation and remediation feasibility study, and this work is ongoing. Soil remediation and groundwater monitoring are being conducted,and further remediation options to address sediment and surface water are being evaluated. Duration of remedial activities currently cannot beestimated.

Financial Reserves�As of September 30, 2005, the company had reserves of approximately $8.6 million for the remediation activities,including those currently under evaluation, described above. This includes $4.9 million added to the reserve for the nine months endedSeptember 30, 2005 because additional soil volumes requiring excavation and disposal have been identified. Although actual costs may differfrom current estimates, the amount of any revisions in remediation costs cannot be reasonably estimated at this time.


In January 2003, Tronox LLC entered into a consent order with the Mississippi Department of Environmental Quality to implement aremedy pursuant to an approved remediation work plan for a wood-treatment site in Hattiesburg, Mississippi. Components of the work planincluded excavation of certain materials from the former processing areas and off-site sediments and containment of other on-site and off-sitematerials. Remediation of the former processing and certain off-site areas was completed in 2003. Some off-site remediation required by thework plan has not been completed where access by current leaseholders has been denied. Efforts to obtain necessary access are ongoing, andremedial activities are expected to take about one to two years once access is obtained.

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Financial Reserves�As of September 30, 2005, the company had reserves of approximately $2.8 million for the remediation activitiesdescribed above. Although actual costs may differ from current estimates, the amount of any revisions in remediation costs cannot bereasonably estimated at this time.

Cleveland, Oklahoma

Kerr-McGee Refining Corporation ("KM Refining") owned and operated a petroleum refinery near Cleveland, Oklahoma until thefacility was closed in 1972. In 1992, KM Refining entered into a Consent Order with the Oklahoma Department of Health (later, the ODEQ),which addresses the remediation of air, soil, surface water and ground water contaminated by hydrocarbons and other refinery-relatedmaterials. Facility dismantling and several interim remedial measures have been completed. In 2004, ODEQ approved the soil and wastefeasibility study, which includes construction of an on-site disposal cell. Design of the cell is in process. In addition, a feasibility study ofsurface and groundwater remedial measures has been submitted to ODEQ and currently is under review. Duration of remedial activitiescurrently cannot be estimated.

Financial Reserves�As of September 30, 2005, the company had reserves of approximately $4.5 million for the remediation activitiesdescribed above, including the remedial measures recommended in the feasibility study currently under review. This includes $1.4 millionadded to the reserve for the nine months ended September 30, 2005, as studies indicated that groundwater remediation would be more costlythan previously estimated. Although actual costs may differ from current estimates, the amount of any revisions in remediation costs cannot bereasonably estimated at this time.

Cushing, Oklahoma

In 1972, KM Refining closed a petroleum refinery it had operated near Cushing, Oklahoma. Prior to closing the refinery, KM Refiningalso had produced uranium and thorium fuel and metal at the site pursuant to licenses issued by the AEC. The uranium and thorium operationscommenced in 1962 and were shutdown in 1966, at which time KM Refining decommissioned and cleaned up to applicable standards theportion of the facility related to uranium and thorium operations. The refinery also was cleaned up to applicable standards at the time ofclosing.

Subsequent regulatory changes have required more extensive remediation at the site. In 1990, KM Refining entered into a consentagreement with the State of Oklahoma to investigate the site and take appropriate remedial actions related to petroleum refining and uraniumand thorium residuals. Investigation and remediation of hydrocarbon contamination is being performed under the oversight of the ODEQ. Soilremediation to address hydrocarbon contamination is expected to take about four more years. The long-term scope, duration and cost ofgroundwater remediation are uncertain and, therefore, additional costs beyond those accrued may be incurred in the future.

Additionally, in 1993, KM Refining received a decommissioning license from the NRC, the successor to AEC's licensing authority, toperform certain cleanup of uranium and thorium residuals.

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All known radiological contamination has been removed from the site and shipped to a licensed disposal facility.

Financial Reserves�As of September 30, 2005, the company had reserves of $13.8 million for the costs of the ongoing remediation anddecommissioning work described above. Although actual costs may differ from current estimates, the amount of any revisions in remediationcosts cannot be reasonably estimated at this time.

Calhoun, Louisiana

From 1973 until 1988, KM Refining owned and operated a gas condensate stripping facility located near Calhoun, Louisiana. When thefacility was sold in 1988, KM Refining retained responsibility for environmental conditions existing prior to the date of closing. Operations atthe facility prior to the sale had resulted in the contamination of soil and groundwater with petroleum hydrocarbons. The LouisianaDepartment of Environmental Quality has approved a Corrective Action Plan for remediating the soil and groundwater contamination.Remediation is ongoing and expected to take about three more years.

Financial Reserves�As of September 30, 2005, the company had reserves of $4.8 million for the costs of the remediation activitiesdescribed above. Although actual costs may differ from current estimates, the amount of any revisions in remediation costs cannot bereasonably estimated at this time.

Jacksonville, Florida

In 1970, Tronox LLC purchased a facility in Jacksonville, Florida that manufactured and processed fertilizers, pesticides and herbicides.Tronox LLC closed the facility in 1978. In 1988, all structures were removed and Tronox LLC began site characterization studies. In 2000,Tronox LLC entered into a consent order with EPA to conduct a remedial investigation and a feasibility study. The remedial investigation wascompleted and submitted to EPA in August 2005. It is anticipated that the feasibility study will be submitted to EPA in early 2006 and that itwill recommend soil remediation and excavation at the site as well as site capping.

Financial Reserves�As of September 30, 2005, the company had reserves of $5.6 million to complete the feasibility study and to conductthe cleanup and remediation activities the company expects to recommend to EPA, $5.6 million of which was added in the nine months endedSeptember 30, 2005. Although actual costs may differ from the current estimates, the amount of any revisions in remediation costs cannot bereasonably estimated at this time.

Other Sites and Matters

In addition to the sites described above, the company is responsible for environmental costs related to certain other sites. These sitesrelate primarily to wood-treating, chemical production, landfills, mining, and oil and gas refining, distribution and marketing. As ofSeptember 30, 2005, the company had reserves of $33.4 million for the environmental costs in connection with these other sites. Althoughactual costs may differ from current estimates, the amount of any revisions in remediation costs cannot be reasonably estimated at this time.

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Pursuant to the form of Master Separation Agreement by and among Kerr-McGee Corporation, Kerr-McGee Worldwide Corporation andthe company, and effective upon completion of the initial public offering of the company's common stock, Kerr-McGee WorldwideCorporation will reimburse the company for a portion of the environmental remediation costs it incurs and pays after the completion of theinitial public offering (net of any cost reimbursements it recovers or expects to recover from insurers, governmental authorities or otherparties). The reimbursement obligation extends to costs incurred at any site associated with any of the company's former businesses oroperations.

With respect to any site for which the company has established a reserve as of the effective date of the Master Separation Agreement,50% of the remediation costs the company incurs in excess of the reserve amount (subject to a minimum threshold amount) will bereimbursable by Kerr-McGee, net of any amounts recovered or, in the company's reasonable and good faith estimate, that will be recoveredfrom third parties. With respect to any site for which the company has not established a reserve as of the effective date of the MasterSeparation Agreement, 50% of the amount of the remediation costs the company incurs and pays (subject to a minimum threshold amount)will be reimbursable by Kerr-McGee, net of any amounts recovered or, in the company's reasonable and good faith estimate, that will berecovered from third parties.

Kerr-McGee's aggregate reimbursement obligation to the company cannot exceed $100 million and is subject to various other limitationsand restrictions. For example, Kerr-McGee is not obligated to reimburse the company for amounts it pays to third parties in connection withtort claims or personal injury lawsuits, or for administrative fines or civil penalties that the company is required to pay. Kerr-McGee'sreimbursement obligation also is limited to costs that the company actually incurs and pays within seven years following the completion of theinitial public offering.

Litigation and Claims

Coal Supply Contract

A predecessor of Tronox Worldwide LLC entered into a coal supply contract with Peabody Coaltrade, Inc. ("PCI") in February 1998. In1998, the predecessor exited the coal business and assigned its rights and obligations under the coal supply contract to a third party. Inconnection with the assignment, the predecessor agreed to guarantee performance under the contract. PCI has notified Tronox WorldwideLLC of a threatened default by the assignee under the coal supply contract and that PCI may seek to hold Tronox Worldwide LLC liable underthe 1998 guaranty in the event of a default. In addition to other defenses to the enforceability of the guaranty, the company believes theguaranty expired in January 2003 when the primary term of the coal supply contract expired. No reserve has been provided for performanceunder the guaranty because the company does not believe a loss is probable and the amount of any loss is not reasonably estimable.

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Western Fertilizer Contract

In 1995, the company executed an exclusive agreement with Western Fertilizer, Inc. ("Western Fertilizer") for the storage anddistribution of fertilizer produced by the company. In May 2000, the company terminated the agreement because the owner, operator and thekey person of Western Fertilizer, had been sentenced to serve 17 years in prison for federal crimes involving activities unrelated to thecompany, thus rendering Western Fertilizer unable to perform its duties under the agreement. In June 2000, Western Fertilizer filed forbankruptcy, and its trustee alleged that the company did not have the right to terminate the agreement. In May 2003, Western Fertilizer'sbankruptcy claim against Kerr-McGee and Tronox LLC was transferred to a litigation trust, and, in October 2004, the litigation trust filed anamended complaint in a pending federal lawsuit in the U.S. District Court in Idaho, seeking monetary damages of approximately $13 millionfor alleged breaches of contract. The litigation is in the early stages of discovery. The company believes that the claims made in the complaintare without substantial merit and is vigorously defending against them. The company believes that damages, if any, related to the claims willnot have a material adverse effect on the company.

Flint Hills Contract

On October 11, 2004, Kerr-McGee and Southwestern Refining Corporation were named defendants in a lawsuit filed by Flint HillsResources, LP. In the lawsuit, which has been removed to the U.S. District Court in the Southern District of Texas, Corpus Christi division,Flint Hills alleges that Kerr-McGee and Southwestern Refining Corporation breached certain environmental representations and warrantiescontained in the agreement pursuant to which Southwestern Refining Corporation sold its refinery in Corpus Christi, Texas to a predecessor ofFlint Hills. Flint Hills claims damages of approximately $7 million. The litigation is in the early stages of discovery. The company believesthat the claims made in the complaint are without substantial merit and is vigorously defending against them. The company believes thatdamages, if any, related to the claims will not have a material adverse effect on the company.


Between 1999 and 2001, Tronox LLC was named in 22 lawsuits in three states (Mississippi, Louisiana and Pennsylvania) in connectionwith former forest products operations located in those states (in Columbus, Mississippi; Bossier City, Louisiana; and Avoca, Pennsylvania).The lawsuits sought recovery under a variety of common law and statutory legal theories for personal injuries and property damages allegedlycaused by exposure to and /or release of creosote and other substances used in the wood-treatment process. Tronox LLC has executedsettlement agreements that are expected to resolve substantially all of the Louisiana, Pennsylvania and Mississippi lawsuits described above.Resolution of the remaining cases is not expected to have a material adverse effect on the company.

Following the adoption by the Mississippi legislature of tort reform, plaintiffs' lawyers filed many new lawsuits across the state ofMississippi in advance of the reform's effective date. On December 31, 2002, August 31, 2004, September 27, 2004 and May 2, 2005,approximately 250 lawsuits were filed against the company on behalf of approximately 5,100 claimants in connection with the company's

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Columbus, Mississippi, operations, seeking recovery on legal theories substantially similar to those advanced in the litigation referred toabove. Substantially all of these lawsuits were filed in or have been removed to the U.S. District Court for the Northern District of Mississippi,and the court has consolidated these lawsuits for pretrial and discovery purposes. On December 31, 2002, June 13, 2003, and June 25, 2004,three lawsuits were filed against Tronox LLC in connection with a former wood-treatment plant located in Hattiesburg, Mississippi. OnSeptember 9, 2004, February 11, 2005, and March 2, 2005, three lawsuits were filed against Tronox LLC in connection with a former wood-treatment plant located in Texarkana, Texas. In addition, on January 3, 2005, February 16, 2005, March 11, 2005, May 24, 2005, June 27,2005 and July 26, 2005, 35 lawsuits were filed against Tronox LLC and Tronox Worldwide LLC in connection with the Avoca, Pennsylvaniafacility described above. These lawsuits seek recovery on legal theories substantially similar to those advanced in the litigation referred toabove. A total of approximately 3,300 claimants now have asserted claims in connection with the Hattiesburg plant, there are 64 plaintiffsnamed in the Texarkana lawsuits and approximately 4,600 plaintiffs are named in the new Avoca lawsuits. Tronox LLC has resolvedapproximately 1,490 of the Hattiesburg claims pursuant to a settlement reached in April 2003, which has resulted in aggregate payments byTronox LLC of approximately $0.6 million.

The company believes that the follow-on Columbus and Avoca claims, the remaining Hattiesburg claims and the claims related to theTexarkana plants are without substantial merit and is vigorously defending against them. The company has not provided a reserve for theselawsuits because at this time it cannot reasonably determine the probability of a loss, and the amount of loss, if any, cannot be reasonablyestimated. The company believes that the ultimate resolution of the forest products litigation will not have a material adverse effect on thecompany.

Kemira

In 2000, the company acquired its titanium dioxide production facility in Savannah, Georgia, from Kemira Pigments Oy, a Finnishcompany, and its parent, Kemira Oyj (together, "the Sellers"). After acquiring the facility, the company discovered that certain mattersassociated with environmental conditions and plant infrastructure was not consistent with representations made by the Sellers. The companysought recovery for breach of representations and warranties in a proceeding before the London Court of International Arbitration (LCIA). OnMay 9, 2005, the Company received notice from the LCIA that the LCIA had found in favor of the company as to liability with respect tocertain of the claims. The LCIA still must determine the amount of damages. The company currently cannot reasonably estimate the amountof damages that will be awarded. The company will recognize a receivable, if and when damages are awarded and all contingencies associatedwith any recovery are resolved.

Other Matters

The company is a party to a number of legal and administrative proceedings involving environmental and/or other matters pending invarious courts or agencies. These proceedings, individually and in the aggregate, are not expected to have a material adverse effect on thecompany. These proceedings are also associated with facilities currently or previously owned, operated or used by

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the company and/or their predecessors, some of which include claims for personal injuries, property damages, clean up costs and otherenvironmental matters. Current and former operations of the company also involve management of regulated materials and are subject tovarious environmental laws and regulations. These laws and regulations will obligate the company's affiliates to clean up various sites atwhich petroleum and other hydrocarbons, chemicals, low-level radioactive substances and/or other materials have been contained, disposed ofor released. Some of these sites have been designated Superfund sites by EPA pursuant to CERCLA or state equivalents. Similarenvironmental laws and regulations and other requirements exist in foreign countries in which the company operates.

11. Income Taxes

On October 22, 2004, the President of the United States signed into law the American Jobs Creation Act of 2004 (the "Act"). A provisionof the Act includes a one-time dividends received deduction of 85% of certain foreign earnings that are repatriated, as defined in the Act. OnApril 11, 2005, management completed its analysis of the impact of the Act on the company's plans for repatriation. Based on this analysis,the company has repatriated $121.0 million through September 30, 2005, in extraordinary dividends, as defined in the Act, and recognizedincome tax expense of $6.4 million. The income tax expense was reduced by $1.9 million of foreign tax credits

In the following table, the U.S. Federal income tax rate is reconciled to the company's effective tax rates for income from continuingoperations as reflected in the Condensed Combined Statement of Operations for the nine months ended September 30, 2005.

U.S. statutory rate�provision 35.0%Increases (decreases) resulting from�

Taxation of foreign operations (2.5)State income taxes 0.5Cash repatriation taxes 8.2Prior year accrual adjustments (8.0)Interest on foreign tax contingency 3.0Other�net 1.1

Total 37.3%

12. Business Segments

The company has two reportable segments: pigment, and electrolytic and other chemical products. The pigment segment primarilyproduces and markets titanium dioxide pigment and has production facilities in the United States, Australia, Germany and the Netherlands.The pigment segment also includes heavy minerals production operated by the company and its partner under a joint venture arrangement. Theheavy minerals production is integrated with our Australian pigment plant but also has sales to third parties. The electrolytic and otherchemical products segment represents the company's electrolytic manufacturing and marketing operations, all of which are located in theUnited States.

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Segment performance is evaluated using operating profit (loss), which represents the results of segment operations before consideringgeneral expenses and environmental provisions related to sites no longer in operation, other income (expense) and income taxes. Following isa summary of revenues and operating profit (loss) for each of the company's business segments for the nine months ended September 30, 2005and 2004.

Nine Months Ended

September 30,

2005 2004


Net salesPigment $ 944.2 $ 869.4Electrolytic and other chemical products 73.3 70.5

Total $ 1,017.5 $ 939.9

Operating profit (loss)Pigment $ 80.2 $ (91.4)Electrolytic and other chemical products(1) (6.3) (0.8)

73.9 (92.2)Expenses for nonoperating sites(2) (1.3) (5.6)Provision for environmental remediation and restoration(2) (5.6) (2.2)

Total operating profit (loss) 67.0 (100.0)Other income (expense) (12.1) (20.0)

Income (loss) from continuing operations before income taxes $ 54.9 $ (120.0)

(1)Includes $11.3 million and $0.4 million for the nine months ended September 30, 2005 and 2004, respectively, of environmentalcharges, net of reimbursements, related to ammonium perchlorate at the company's Henderson facility.

(2)Includes general expenses and environmental provisions related to various businesses in which the company is no longer engaged, buthave not met the criteria for reporting as discontinued operations.

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Total assets for each of the company's business segments at September 30, 2005 and December 31, 2004 were as follows:

September 30, 2005 December 31, 2004


Total assetsPigment $ 1,484.6 $ 1,349.8Electrolytic and other chemical products 127.1 115.4

1,611.7 1,465.2Corporate and other assets 91.3 127.3Assets held for sale � 3.4

Total $ 1,703.0 $ 1,595.9

13. Subsequent Events

Prior to the completion of the offering, the company will enter into agreements with Kerr-McGee that will govern the separation of thebusinesses and various interim and ongoing relationships, including agreements with respect to the provision of interim services by Kerr-McGee to the company. Under the separation agreements, the company will transition $34.5 million of letters of credit that are outstanding atOctober 31, 2005 under Kerr-McGee's credit facility to the company's revolving credit facility that will be entered into concurrent with theoffering as discussed below.

Concurrent with the completion of the offering, Tronox Worldwide will enter into a senior secured credit facility consisting of a$200 million six-year term loan facility and a $250 million five-year multicurrency revolving credit facility. The credit facility will beguaranteed by Tronox Incorporated and Tronox Worldwide's direct and indirect material domestic subsidiaries (including Tronox FinanceCorp., a newly formed entity which consists solely of insignificant formation capital). Tronox Worldwide and Tronox Finance Corp. will alsobe offering $350 million in aggregate principal amount of unsecured notes due 2012 in a concurrent private offering. All of the net proceedsfrom the term loan facility and the unsecured notes will be distributed to Kerr-McGee.

In October 2005, Kerr-McGee completed the transfer of its ownership interest in certain European subsidiaries to Tronox Worldwide.

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17,480,000 Shares

Class A Common Stock

PROSPECTUS, 2005

Joint Book-Running Managers

LEHMAN BROTHERS JPMORGAN

Senior Co-Managers

CITIGROUP CREDIT SUISSE FIRST BOSTON

Co-Managers

ABN AMRO INCORPORATED FRIEDMAN BILLINGS RAMSEY

SCOTIA CAPITALSG CORPORATE & INVESTMENT

BANKINGSUNTRUST ROBINSON HUMPHREY



Part IIINFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

The following table sets forth our estimated costs and expenses (other than underwriting discounts) payable in connection with thisoffering.

SEC Registration Fee $ 48,600NASD Filing Fee 41,800Printing and Engraving Expenses 950,000Legal Fees and Expenses 900,000Accounting Fees and Expenses 1,080,000NYSE Listing Fees 150,000Blue Sky Qualification Fees and Expenses 5,000Transfer Agent and Registrar Fees 5,000Miscellaneous 230,000

Total $ 3,410,400

ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS

Tronox Incorporated, or the Registrant, is a Delaware corporation. Section 145 of the Delaware General Corporation Law, or the DGCL,grants each corporation organized thereunder the power to indemnify any person who is or was a director, officer, employee or agent of acorporation or enterprise, against expenses, including attorneys' fees, judgments, fines and amounts paid in settlement actually and reasonablyincurred by him in connection with any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative orinvestigative, other than an action by or in the right of the corporation, by reason of being or having been in any such capacity, if he acted ingood faith in a manner reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminalaction or proceeding, had no reasonable cause to believe his conduct was unlawful.

Section 102(b)(7) of the DGCL enables a corporation in its certificate of incorporation or an amendment thereto to eliminate or limit thepersonal liability of a director to the corporation or its stockholders for monetary damages for violations of the directors' fiduciary duty ofcare, except (i) for any breach of the director's duty of loyalty to the corporation or its stockholders, (ii) for acts or omissions not in good faithor which involve intentional misconduct or a knowing violation of law, (iii) pursuant to Section 174 of the DGCL (providing for liability ofdirectors for unlawful payment of dividends or unlawful stock purchases or redemptions) or (iv) for any transaction from which a directorderived an improper personal benefit.

The Registrant's amended and restated certificate of incorporation provides that, except as otherwise provided by the DGCL, no directorof the Registrant shall be personally liable to the Registrant or its stockholders for monetary damages for breach of fiduciary duty as adirector.

The Registrant's amended and restated bylaws provide that the Registrant shall indemnify directors and officers of the Registrant asspecified in the amended and restated certificate of incorporation. In addition, to the fullest extent permitted by the DGCL, the Registrant shallindemnify any current or former director or officer of the Registrant and may, at the discretion of the Board of Directors, indemnify anycurrent or former employee or agent of the Registrant against all expenses, judgments, fines and amounts paid in settlement actually andreasonably incurred by him in connection with any threatened, pending or completed action, suit or proceeding brought by or in the light ofthe Registrant or otherwise, to which he or she was or is a party by reason of his or her current or former position

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with the Registrant or by reason of the fact that he or she is or was serving, at the request of the Registrant, as a director, officer, partner,trustee, employee or agent of another corporation, partnership, joint venture, trust or other enterprise.

The Registrant's amended and restated bylaws also provide that expenses incurred by a person who is or was a director or officer of theRegistrant in appearing at, participating in or defending any such action, suit or proceeding shall be paid by the Registrant at reasonableintervals in advance of the final disposition of such action, suit or proceeding upon receipt of an undertaking by or on behalf of the director orofficer to repay such amount if it shall ultimately be determined that he or she is not entitled to be indemnified by the Registrant as authorizedby the Registrant's amended and restated bylaws.

The underwriting agreement provides that the underwriters are obligated, under certain circumstances, to indemnify directors, officersand controlling persons of the Registrant against certain liabilities, including liabilities under the Securities Act of 1933. Reference is made tothe form of underwriting agreement filed as Exhibit 1.1 hereto.

The master separation agreement among the Registrant, Kerr-McGee Worldwide Corporation and Kerr-McGee Corporation provides forindemnification by the Registrant of Kerr-McGee Corporation and its affiliates, directors, officers and employees for certain liabilities,including liabilities under the Securities Act of 1933 for any untrue statement of material fact contained in this Registration Statement, oromission or alleged omission to state a material fact herein, which is necessary to make the statements contained herein not misleading.

ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES

The Registrant has not sold any securities, registered or otherwise, within the past three years, except for the shares issued uponformation to Registrant's sole stockholder.

ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a) Exhibit Index

A list of exhibits filed with this registration statement on Form S-1 is set forth on the Exhibit Index and is incorporated in this Item 16(a)by reference.

(b) Financial Statement Schedules

Schedule II�Valuation Accounts and Reserves

All other schedules are omitted because they are either not required, not significant, not applicable or the informationis presented in the combined financial statements or the notes to the combined financial statements.

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SCHEDULE II

TRONOXVALUATION ACCOUNTS AND RESERVES

Additions


Balance at

Beginning of

Year

Charged to

Profit and Loss

Charged to

Other

Accounts

Deductions from

Reserves

Balance at

End of Year

Year Ended December 31, 2004Deducted from asset accounts

Allowance for doubtful notes and accountsreceivable

$ 17.8 $ 1.4 $ 2.0 $ 1.5 $ 19.7

Valuation allowance for deferred tax assets 5.0 1.1 � � 6.1Warehouse inventory obsolescence 7.2 5.3 0.1 0.9 11.7

Total $ 30.0 $ 7.8 $ 2.1 $ 2.4 $ 37.5



$ 18.0 $ 0.6 $ 0.5 $ 1.3 $ 17.8

Valuation allowance for deferred tax assets � 5.0 � � 5.0Warehouse inventory obsolescence 3.8 5.8 0.2 2.6 7.2

Total $ 21.8 $ 11.4 $ 0.7 $ 3.9 $ 30.0



$ 19.1 $ 0.4 $ � $ 1.5 $ 18.0

Warehouse inventory obsolescence 4.5 1.0 0.2 1.9 3.8

Total $ 23.6 $ 1.4 $ 0.2 $ 3.4 $ 21.8

ITEM 17. UNDERTAKINGS

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons ofthe registrant pursuant to the foregoing provisions, or otherwise, the registrants have been advised that in the opinion of the SEC suchindemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim forindemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer orcontrolling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer orcontrolling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has beensettled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against publicpolicy as expressed in the Securities Act and will be governed by the final adjudication of such issue.



(1) The undersigned registrant hereby undertakes to provide to the underwriter at the closing specified in the underwritingagreements, certificates in such denominations and registered in such names as required by the underwriter to permit promptdelivery to each purchaser.

(2) The undersigned registrant hereby undertakes that:

(a) For purposes of determining any liability under the Securities Act, the information omitted from the form ofprospectus filed as part of this registration statement in reliance

II-3



upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h)under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.

(b) For purposes of determining any liability under the Securities Act, each post-effective amendment that containsa form of prospectus shall be deemed to be a new registration statement relating to the securities offering therein, and theoffering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

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SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, Tronox Incorporated has duly caused this registration statement to be signedon its behalf by the undersigned, thereunto duly authorized, in the City of Oklahoma City, State of Oklahoma, on November 17, 2005.

Tronox Incorporated

By:/s/ THOMAS W. ADAMSName: Thomas W. AdamsTitle: Chief Executive Officer

Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in thecapacities indicated on November 17, 2005.

Signature Title

/s/ THOMAS W. ADAMSThomas W. Adams Chief Executive Officer and Director (Principal Executive Officer)

/s/ MARY MIKKELSON

Mary MikkelsonSenior Vice President and Chief Financial Officer (PrincipalFinancial and Accounting Officer)

/s/ MARTY J. ROWLAND

Marty J. Rowland Chief Operating Officer and Director

/s/ ROBERT M. WOHLEBERRobert M. Wohleber Chairman of the Board and Director

*Peter D. Kinnear Director

/s/ J. MICHAEL RAUH

J. Michael Rauh Director

*

Bradley C. Richardson Director

*By:/s/ THOMAS W. ADAMSThomas W. AdamsAttorney-in-fact

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EXHIBIT INDEX

Exhibit No. Description of Exhibit

1.1 Form of Underwriting Agreement

2.1+ Form of Master Separation Agreement

3.1+ Form of Amended and Restated Certificate of Incorporation of Tronox Incorporated

3.2+ Form of Amended and Restated Bylaws of Tronox Incorporated

4.1+ Form of Specimen Certificate of Class A Common Stock

4.2+ Form of Specimen Certificate of Class B Common Stock

4.3+ Form of Rights Agreement between Tronox Incorporated and UMB Bank, N.A., as Rights Agent

5.1 Opinion of Covington & Burling

10.1+ Form of Registration Rights Agreement

10.2+ Form of Transitional License Agreement

10.3+ Form of Tax Sharing Agreement

10.4+ Form of Employee Benefits Agreement

10.5+ Form of Transition Services Agreement

10.6+Assignment, Assumption, and Indemnity Agreement between Tronox Worldwide LLC (formerly Kerr-McGee ChemicalWorldwide LLC) and Kerr-McGee Oil & Gas Corporation, dated December 31, 2002

10.7+ Form of Continuity Agreement for Officers

10.8+ Form of Continuity Agreement for Key Employees

10.9+ Form of the Long Term Incentive Plan

10.10 Form of Credit Agreement

10.11 Form of Indenture

21.1 List of Subsidiaries of Tronox Incorporated

23.1 Consent of Covington & Burling (included as part of its opinion filed as Exhibit 5.1 hereto)

23.2 Consent of Ernst & Young LLP

24.1+ Powers of Attorney from Thomas W. Adams, Mary Mikkelson, Robert M. Wohleber and J. Michael Rauh



24.2+ Power of Attorney from Marty J. Rowland

24.3+ Power of Attorney from Bradley C. Richardson

24.4+ Power of Attorney from Peter D. Kinnear

+Previously filed.



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EXHIBIT 1.1

TRONOX INCORPORATED

17,480,000 Shares of Class A Common Stock

FORM OF

UNDERWRITING AGREEMENT

November , 2005

LEHMAN BROTHERS INC.J.P. MORGAN SECURITIES INC.As Representatives of the several

Underwriters named in Schedule 1 heretoc/o Lehman Brothers Inc.745 Seventh AvenueNew York, New York 10019

Ladies and Gentlemen:

Tronox Incorporated, a Delaware corporation (the "Company") and an indirect wholly-owned subsidiary of Kerr-McGee Corporation, aDelaware corporation ("Parent"), proposes to sell an aggregate of 17,480,000 shares (the "Firm Stock") of the Company's Class A commonstock, par value $0.01 per share ("Common Stock"). In addition, the Company proposes to grant to the underwriters (the "Underwriters")named in Schedule 1 attached to this agreement (this "Agreement") an option to purchase up to an additional 2,622,000 shares of CommonStock on the terms set forth in Section 3 (the "Option Stock"). The Firm Stock and the Option Stock, if purchased, are hereinafter collectivelycalled the "Stock." This is to confirm the agreement concerning the purchase of the Stock from the Company by the Underwriters.

The Company currently has no subsidiaries and no material assets or liabilities. Prior to the Initial Delivery Time (as defined below),Tronox Worldwide LLC, a Delaware limited liability company ("Tronox Worldwide"), will be transferred to the Company by Kerr-McGeeWorldwide Corporation, a Delaware corporation ("Kerr-McGee Worldwide") and wholly-owned subsidiary of Parent.

The Company, in accordance with the requirements of Rule 2720 of the National Association of Securities Dealers, Inc. (the "NASD")and subject to the terms and conditions stated herein, hereby confirms the engagement of the services of Freidman, Billings, Ramsey &Co., Inc. as a "qualified independent underwriter" within the meaning of Rule 2720(b)(15) of the Conduct Rules of the NASD in connectionwith the offering and sale of the Stock.

1. Representations, Warranties and Agreements of the Company. Each of the Company and Tronox Worldwide, jointly and severally,represents, warrants and agrees that:

(a) A registration statement on Form S-1 (File No. 333-125574) with respect to the Stock has (i) been prepared by theCompany and filed with the Securities and Exchange Commission (the "Commission") under the Securities Act of 1933, asamended (the "Securities Act"); and (ii) become effective under the Securities Act. Copies of such registration statement and eachamendment thereto have been delivered by the Company to you as the representatives (the "Representatives") of the Underwriters.As used in this Agreement, "Effective Time" means the date and the time as of which such registration statement, or the most recentpost-effective amendment thereto, if any, was declared effective by the Commission; "Effective Date" means the date of the



Effective Time; "Preliminary Prospectus" means each prospectus included in such registration statement, or amendments thereto,before such registration statement became effective under the Securities Act and any prospectus filed

1



with the Commission by the Company with the consent of the Representatives pursuant to Rule 424(a) of the rules and regulations(the "Rules and Regulations") of the Commission; "Registration Statement" means such registration statement, as amended at theEffective Time, including all information contained in the final prospectus filed with the Commission pursuant to Rule 424(b) of theRules and Regulations and deemed to be a part of the registration statement as of the Effective Time pursuant to paragraph (b) ofRule 430A of the Rules and Regulations; and "Prospectus" means such final prospectus, as first filed with the Commission pursuantto paragraph (1) or (4) of Rule 424(b) of the Rules and Regulations. The Commission has not issued any order preventing orsuspending the use of any Preliminary Prospectus or Prospectus or suspending the effectiveness of the Registration Statement, andno proceeding for such purpose has been instituted or, to the Company's knowledge, threatened by the Commission.

(b) The Registration Statement conformed in all material respects at the Effective Time and conforms in all material respects,and any post-effective amendment to the Registration Statement filed after the date hereof will conform in all material respects onthe applicable Effective Date, to the requirements of the Securities Act and the Rules and Regulations. The Prospectus will conformin all material respects when filed with the Commission pursuant to Rule 424(b) and at the applicable Delivery Time (as defined inSection 5) to the requirements of the Securities Act and the Rules and Regulations. The Registration Statement, at the EffectiveTime, and the Prospectus, as of its date and at the applicable Delivery Time, do not and will not contain an untrue statement of amaterial fact or omit to state a material fact required to be stated therein or necessary to make the statements therein (in the case ofthe Prospectus, in the light of the circumstances under which they were made) not misleading; provided, that no representation orwarranty is made as to information contained in or omitted from the Registration Statement or the Prospectus in reliance upon and inconformity with written information furnished to the Company through the Representatives by or on behalf of any Underwriterspecifically for inclusion therein, which information is specified in Section 9(f).

(c) Each of the Company and Tronox Worldwide has been duly organized, is validly existing and in good standing as acorporation or limited liability company, as applicable, under the laws of its jurisdiction of organization and is duly qualified to dobusiness and in good standing as a foreign corporation or other business entity in each jurisdiction in which its ownership or lease ofproperty or the conduct of its businesses requires such qualification, except where the failure to be so qualified or be in goodstanding, individually or in the aggregate, would not reasonably be expected to have a material adverse effect on the condition(financial or otherwise), results of operations, stockholders' equity, properties or business of the Company, Tronox Worldwide andTronox Worldwide's subsidiaries taken as a whole (a "Material Adverse Effect"). Each of the Company and Tronox Worldwide hasall corporate and limited liability company, as applicable, power and authority necessary to own or hold its properties and to conductits business as described in the Prospectus, except where the failure to have such power or authority would not reasonably beexpected to have a Material Adverse Effect. Each of the Significant Subsidiaries (as defined in Section 18) has been duly organizedand is validly existing as a corporation or other legal entity in good standing under the laws of its jurisdiction of organization. At theInitial Delivery Time, the Company will not own or control, directly or indirectly, any corporation, association or other entity otherthan the subsidiaries set forth on Schedule 2 hereto. None of the subsidiaries of the Company (other than those set forth in Part II ofSchedule 2 hereto) will be a "significant subsidiary," as such term is defined in Rule 1-02(w) of Regulation S-X at the InitialDelivery Time.

(d) The Company's authorized capitalization conforms in all material respects to the description thereof contained in theProspectus under the heading "Description of Capital Stock." All of the issued shares of capital stock of the Company have beenduly authorized and validly issued, are fully paid and non-assessable and are free of statutory and contractual preemptive rights,resale rights, rights of first refusal and similar rights. All of the issued shares of capital stock of each Significant

2



Subsidiary (as defined in Section 18) that is a subsidiary of Tronox Worldwide (except in the case of a Significant Subsidiary that isnot wholly-owned directly or indirectly by Tronox Worldwide, such portion of the capital stock of such subsidiary issued to TronoxWorldwide or any of its subsidiaries) have been duly authorized and validly issued, are fully paid and non-assessable and (except fordirectors' qualifying shares for foreign subsidiaries) are owned directly or indirectly by Tronox Worldwide, free and clear of allliens, encumbrances, equities or claims, except for such liens, encumbrances, equities or claims (i) imposed in connection with thesenior secured credit facility referenced in the Prospectus or (ii) as could not, individually or in the aggregate, materially affect thevalue of such shares of capital stock.

(e) The shares of the Stock to be issued and sold by the Company to the Underwriters hereunder have been duly authorizedand, upon payment, issuance and delivery in accordance with this Agreement, will be validly issued, fully paid and non-assessable,will conform in all material respects to the description thereof contained in the Prospectus and will be free of statutory andcontractual preemptive rights, resale rights, rights of first refusal and similar rights.

(f) This Agreement has been duly and validly authorized, executed and delivered by the Company.

(g) That certain Assignment, Assumption and Indemnity Agreement, dated December 31, 2002 (the "Assignment"), by andbetween Tronox Worldwide and Kerr-McGee Oil & Gas Corporation, a Delaware corporation ("Kerr-McGee Oil & Gas") and anindirect wholly-owned subsidiary of Parent, has been duly and validly authorized, executed and delivered by Tronox Worldwideand, assuming due authorization, execution and delivery of the Assignment by Kerr-McGee Oil & Gas, constitutes a valid andlegally binding agreement of Tronox Worldwide, enforceable against Tronox Worldwide in accordance with its terms, except assuch enforceability may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and other similarlaws relating to or affecting creditor's rights generally, by general equitable principles (regardless of whether such enforceability isconsidered in a proceeding in equity or at law) and, as to rights of indemnification and contribution, by principles of public policy.

(h) The Company has all requisite corporate power and authority to execute, deliver and perform its obligations under (i) thatcertain Master Separation Agreement by and among Parent, Kerr-McGee Worldwide and the Company (the "Master SeparationAgreement"), (ii) that certain Registration Rights Agreement by and between Parent and the Company, (iii) that certain TransitionalLicense Agreement by and among Parent and the Company, (iv) that certain Tax Sharing Agreement by and between Parent and theCompany, (v) that certain Employee Benefits Agreement by and between Parent and the Company, and (vi) that certain TransitionServices Agreement by and among Kerr-McGee Worldwide, Parent and the Company (collectively, the "Separation Agreements").Each of the Separation Agreements has been duly and validly authorized by the Company and, assuming due authorization,execution and delivery by each of the other parties thereto, upon execution and delivery by the Company will constitute a valid andlegally binding agreement of the Company, enforceable against the Company in accordance with its terms, except as suchenforceability may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and other similar lawsrelating to or affecting creditor's rights generally, by general equitable principles (regardless of whether such enforceability isconsidered in a proceeding in equity or at law) and, as to rights of indemnification and contribution, by principles of public policy.

(i) The execution, delivery and performance of this Agreement and each of the Separation Agreements by the Company andthe consummation of the transactions contemplated hereby and thereby will not (i) conflict with or result in a breach or violation ofany of the terms or provisions of, impose any lien, charge or encumbrance upon any property or assets of the Company, TronoxWorldwide and the Significant Subsidiaries, or constitute a default under, any indenture, mortgage,

3



deed of trust, loan agreement, license or other agreement or instrument to which the Company, Tronox Worldwide or any of theSignificant Subsidiaries is a party or by which the Company, Tronox Worldwide or any of the Significant Subsidiaries is bound or towhich any of the property or assets of the Company, Tronox Worldwide or any of the Significant Subsidiaries is subject; (ii) resultin any violation of the provisions of the charter or bylaws (or similar organizational documents) of the Company; or (iii) result inany violation of any law or statute or any judgment, order, decree, rule or regulation of any court or arbitrator or governmental orregulatory agency or body having jurisdiction over the Company, Tronox Worldwide or any of the Significant Subsidiaries or any oftheir properties or assets, except in the cases of clauses (i) and (iii) above, such conflicts, breaches, violations, defaults, liens,charges or encumbrances as would not reasonably be expected to have a Material Adverse Effect.

(j) Except for (i) the registration of the Stock under the Securities Act, (ii) such consents, approvals, authorizations,registrations or qualifications as may be required under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), andapplicable state or foreign securities laws in connection with the purchase and sale of the Stock by the Underwriters, (iii) suchconsents, approvals, authorizations, registrations or qualifications as have been obtained, and (iv) such consents, approvals,authorizations, registrations or qualifications the failure of which to obtain would not, individually or in the aggregate, affect thevalidity of the Stock or affect the ability of the Company to consummate the transactions contemplated herein, no consent, approval,authorization or order of, or filing or registration with, any court or governmental agency or body having jurisdiction over theCompany, Tronox Worldwide or any of the Significant Subsidiaries or any of their properties or assets is required for the execution,delivery and performance of this Agreement or the Separation Agreements by the Company or the consummation of the transactionscontemplated hereby and thereby.

(k) The statements set forth in the Prospectus under the caption "Description of Capital Stock," insofar as they purport toconstitute a summary of the terms of the Stock, and under the caption "Arrangements Between Kerr-McGee and Our Company,""Description of Our Concurrent Financing Transactions" and "Material United States Federal Income Tax Consequences to Non-U.S. Holders," insofar as they purport to constitute summaries of the terms, documents and laws referred to therein, are accurate andcomplete summaries of such documents and laws in all material respects.

(l) Since the date of the latest audited financial statements included in the Prospectus, (i) neither the Company, TronoxWorldwide nor any of Tronox Worldwide's subsidiaries has sustained any loss or interference with its business from fire, explosion,flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order ordecree, and (ii) there has not been any change in the capital stock or long-term debt of the Company, Tronox Worldwide or any ofTronox Worldwide's subsidiaries or any adverse change, or any development involving a prospective adverse change, in or affectingthe condition (financial or otherwise), results of operations, stockholders' equity, properties or business of the Company, TronoxWorldwide or any of Tronox Worldwide's subsidiaries, taken as a whole, except, in the case of clauses (i) and (ii), as would notreasonably be expected to have a Material Adverse Effect, or as otherwise set forth in, or contemplated by, the Prospectus, includingthe pro forma financial and capitalization information included therein.

(m) Since the date as of which information is given in the Prospectus and except as may otherwise be disclosed in theProspectus, the Company (i) has not entered into any transaction not in the ordinary course of business that is material to theCompany, Tronox Worldwide and Tronox Worldwide's subsidiaries, taken as a whole, or (ii) declared or paid any dividend on itscapital stock.

(n) The historical combined financial statements (including the related notes and supporting schedules) filed as part of theRegistration Statement or included in the Prospectus present fairly the

4



financial condition, results of operations and cash flows of the entities purported to be shown thereby at the dates and for the periodsindicated and have been prepared in conformity with accounting principles generally accepted in the United States applied on aconsistent basis throughout the periods involved (except as otherwise noted therein).

(o) Ernst & Young LLP ("Ernst & Young"), who have certified certain financial statements contained in the RegistrationStatement and in the Prospectus, whose report appears in the Prospectus and who have delivered the initial letter referred to inSection 8(g) hereof, are independent public accountants with respect to the Company, as required by the Securities Act and theRules and Regulations.

(p) The Company, Tronox Worldwide and each of Tronox Worldwide's subsidiaries have good and marketable title in feesimple to all real property and good and marketable title to all personal property owned by them, in each case free and clear of allliens, encumbrances and defects, except such as are disclosed in the Prospectus or such as do not materially affect the value of suchproperty and do not materially interfere with the use made and proposed to be made of such property by the Company, TronoxWorldwide and Tronox Worldwide's subsidiaries; and all assets held under lease by the Company, Tronox Worldwide and TronoxWorldwide's subsidiaries are held by them under valid, subsisting and enforceable leases, with such exceptions as do not materiallyinterfere with the use made and proposed to be made of such assets by the Company, Tronox Worldwide and Tronox Worldwide'ssubsidiaries.

(q) Each of the Company, Tronox Worldwide and Tronox Worldwide's subsidiaries carry, or are covered by, insuranceprovided by insurers of recognized financial responsibility against such losses and risks and in such amounts as are, whenconsidered in its entirety, in the good faith judgment of the Company, prudent and customary in the businesses in which it isengaged, including at least $100,000,000 of product liability insurance.

(r) Except as disclosed in the Prospectus, there are no legal or governmental proceedings pending to which the Company,Tronox Worldwide or any of Tronox Worldwide's subsidiaries is a party or of which any property or assets of the Company, TronoxWorldwide or any of Tronox Worldwide's subsidiaries is the subject which, if adversely determined against the Company, TronoxWorldwide or any of Tronox Worldwide's subsidiaries, would, individually or in the aggregate, reasonably be expected to have aMaterial Adverse Effect or would, individually or in the aggregate reasonably be expected to have a material adverse effect on theperformance of this Agreement, any Separation Agreement or the consummation of the transactions contemplated hereby or thereby,and to the Company's knowledge, no such proceedings are threatened or contemplated by governmental authorities or others.

(s) No labor disturbance by the employees of the Company, Tronox Worldwide or Tronox Worldwide's subsidiaries exists or,to the knowledge of the Company, is imminent that would reasonably be expected to have a Material Adverse Effect.

(t) Neither the Company, Tronox Worldwide nor any subsidiary of Tronox Worldwide, nor, to the Company's knowledge,any director, officer, agent, employee or other person associated with or acting on behalf of the Company, Tronox Worldwide or anysubsidiary of Tronox Worldwide, has used any corporate funds for any unlawful contribution, gift, entertainment or other unlawfulexpense relating to political activity; made any direct or indirect unlawful payment to any foreign or domestic government official oremployee from corporate funds; violated or is in violation of any provision of the Foreign Corrupt Practices Act of 1977; or madeany bribe, rebate, payoff, influence payment, kickback or other unlawful payment.

(u) The Company, Tronox Worldwide and each of the Significant Subsidiaries have filed all federal, state, local and foreignincome and franchise tax returns required to be filed through the date

5



hereof, subject to permitted extensions, and have paid all taxes due thereon except where failure to file such return or pay such taxeswould not reasonably be expected to have a Material Adverse Effect, and no tax deficiency has been determined adversely to theCompany, Tronox Worldwide or any of the Significant Subsidiaries, nor does the Company have any knowledge of any taxdeficiency, except as would not reasonably be expected to have a Material Adverse Effect or as disclosed in the Prospectus.

(v) Neither the Company, Tronox Worldwide nor any of the Significant Subsidiaries (i) is in violation of its charter or bylaws(or similar organizational documents), (ii) is in default, and no event has occurred that, with notice or lapse of time or both, wouldconstitute such a default, in the due performance or observance of any term, covenant or condition contained in any indenture,mortgage, deed of trust, loan agreement, license or other agreement or instrument to which it is a party or by which it is bound or towhich any of its properties or assets is subject or (iii) except as disclosed in the Prospectus, is in violation of any statute or any order,rule or regulation of any court or governmental agency or body having jurisdiction over it or its property or assets or has failed toobtain any license, permit, certificate, franchise or other governmental authorization or permit necessary to the ownership of itsproperty or to the conduct of its business, except in the case of clauses (ii) and (iii), to the extent any such conflict, breach, violationor default would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

(w) Neither the Company, Tronox Worldwide nor any of Tronox Worldwide's subsidiaries is, and at the applicable DeliveryTime and after giving effect to the offer and sale of the Stock and the application of the proceeds therefrom as described under "Useof Proceeds" in the Prospectus none of them will be, an "investment company" within the meaning of such term under theInvestment Company Act of 1940, as amended.

(x) The Company, Tronox Worldwide and each of Tronox Worldwide's subsidiaries (i) make and keep accurate books andrecords and (ii) maintain a system of internal accounting controls sufficient to provide reasonable assurance that (A) transactions areexecuted in accordance with management's authorization, (B) transactions are recorded as necessary to permit preparation of theCompany's financial statements in conformity with accounting principles generally accepted in the United States and to maintainaccountability for its assets, (C) access to the Company's assets is permitted only in accordance with management's authorizationand (D) the recorded accountability for the Company's assets is compared with existing assets at reasonable intervals andappropriate action is taken with respect to any differences.

(y) The Company, Tronox Worldwide and each of Tronox Worldwide's subsidiaries have established and maintain disclosurecontrols and procedures (as such term is defined in Rule 13a-15 under the Exchange Act), and such disclosure controls andprocedures are effective in all material respects to perform the functions for which they were established.

(z) Except as disclosed in the Prospectus, since the date of the latest audited financial statements included in the Prospectus,there has been no change in the internal controls over financial reporting of the Company or Tronox Worldwide that has materiallyaffected, or is reasonably likely to materially affect, the Company's or Tronox Worldwide's internal control over financial reporting.

(aa) The Company, Tronox Worldwide and each of Tronox Worldwide's subsidiaries have such permits, licenses, patents,franchises, certificates of need and other approvals or authorizations of governmental or regulatory authorities ("Permits") as arenecessary under applicable law to own their properties and conduct their businesses in the manner described in the Prospectus,except where the failure to possess such Permits would not reasonably be expected to have a Material Adverse Effect or asotherwise disclosed in the Prospectus; and neither the Company, Tronox Worldwide nor any of Tronox Worldwide's subsidiaries hasreceived notification of any revocation or termination thereof, except for any of the foregoing that would not reasonably be expectedto have a Material Adverse Effect.

6



(bb) The Company, Tronox Worldwide and Tronox Worldwide's subsidiaries own or possess adequate rights to use all materialpatents, patent applications, trademarks, service marks, trade names, trademark registrations, service mark registrations, copyrights,licenses and know-how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information,systems or procedures) necessary for the conduct of their respective businesses, except where the failure to own or possess wouldnot reasonably be expected to have a Material Adverse Effect, and have no reason to believe that the conduct of their respectivebusinesses will conflict with, and have not received any notice of any claim of conflict with, any such rights of others, whichconflict would reasonably be expected to have a Material Adverse Effect.

(cc) Except as disclosed in the Prospectus, (i) the Company, Tronox Worldwide and each of Tronox Worldwide's subsidiaries(A) are in compliance with all and are not subject to liability under any applicable federal, state, local and foreign laws, regulations,ordinances, rules, orders, judgments, decrees, permits, common law or other legal requirements relating to the protection of humanhealth and safety, the environment, natural resources or hazardous or toxic substances or wastes, pollutants or contaminants("Environmental Laws"), which compliance includes obtaining, maintaining and complying with all permits and authorizations andapprovals required by Environmental Laws to conduct their respective businesses and (B) have not received notice of any actual orpotential liability for the investigation or remediation of any disposal or release of hazardous or toxic substances or wastes,pollutants or contaminants, except in the case of clause (A) or (B) where such non-compliance with or liability under EnvironmentalLaws would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect; (ii) neither theCompany, Tronox Worldwide nor any of Tronox Worldwide's subsidiaries has been named as a "potentially responsible party"under the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, or any other similarEnvironmental Law, except with respect to any matters that, individually or in the aggregate, would not reasonably be expected tohave a Material Adverse Effect; and (iii) none of the Company, Tronox Worldwide and Tronox Worldwide's subsidiaries is a partyto any proceeding under Environmental Laws, other than such proceedings regarding which it is believed no monetary penalties,judgments or other liabilities of $100,000 or more will be imposed.

(dd) None of Kerr-McGee B.V., a company organized under the laws of The Netherlands, Kerr-McGee Chemical FinanceB.V., a company organized under the laws of The Netherlands, and Kerr McGee Finance (Curacao) N.V., a company organizedunder the laws of the Netherlands Antilles, each of which is an indirect wholly-owned subsidiary of Tronox Worldwide, holds anymaterial assets or properties or conducts any business.

(ee) Prior to the Initial Delivery Time, (i) all of the rights, title and interest in and to the outstanding capital stock of TronoxWorldwide shall have been transferred to the Company, and (ii) the Company shall be the holder of record and beneficial owner ofall such capital stock and the sole member under the limited liability company agreement of Tronox Worldwide.

(ff) At each Delivery Time, there will be no indebtedness outstanding between the Company, Tronox Worldwide or anysubsidiary of Tronox Worldwide, on the one hand, and Parent or any subsidiary of Parent (other than the Company, TronoxWorldwide and any subsidiary of Tronox Worldwide), on the other hand.

2. Representations, Warranties and Agreements of Parent. Parent represents, warrants and agrees that:

(a) Each of the Separation Agreements has been duly authorized by Parent or Kerr-McGee Worldwide, as applicable (each a"Kerr-McGee Separation Party"), and assuming the due authorization, execution and delivery of each such Separation Agreementby the other parties thereto, upon execution and delivery by such Kerr-McGee Separation Party will constitute such Kerr-McGeeSeparation Party's valid and legally binding agreement, enforceable against such Kerr-McGee

7



Separation Party, in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, fraudulenttransfer, reorganization, moratorium and other similar laws relating to or affecting creditor's rights generally, by general equitableprinciples (regardless of whether such enforceability is considered in a proceeding in equity or at law) and, as to rights ofindemnification and contribution, by principles of public policy.

(b) The Assignment has been duly authorized, executed and delivered by Kerr-McGee Oil & Gas and constitutes a valid andlegally binding agreement of Kerr-McGee Oil & Gas, enforceable against Kerr-McGee Oil & Gas in accordance with its terms,except as such enforceability may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and othersimilar laws relating to or affecting creditor's rights generally, by general equitable principles (regardless of whether suchenforceability is considered in a proceeding in equity or at law) and, as to rights of indemnification and contribution, by principles ofpublic policy.

(c) The compliance by the applicable Kerr-McGee Separation Party with all of the provisions of the Separation Agreements towhich it is a party, the compliance by Kerr-McGee Oil & Gas with all of the provisions of the Assignment and the consummation ofthe transactions therein contemplated will not (i) conflict with or result in a breach or violation of any of the terms or provisions of,impose any lien, charge or encumbrance upon any property or assets of Parent or any of its subsidiaries (other than the Company,Tronox Worldwide or any of Tronox Worldwide's subsidiaries), or constitute a default under, any indenture, mortgage, deed of trust,loan agreement or other agreement or instrument to which Parent or any of its subsidiaries (other than the Company, TronoxWorldwide or any of Tronox Worldwide's subsidiaries) is a party or by which Parent or any of its subsidiaries (other than theCompany, Tronox Worldwide or any of Tronox Worldwide's subsidiaries) is bound or to which any of the property or assets ofParent or any of its subsidiaries (other than the Company, Tronox Worldwide or any of Tronox Worldwide's subsidiaries) is subject;or (ii) result in any violation of any statute or any order, rule or regulation of any court or governmental agency or body havingjurisdiction over Parent or any of its subsidiaries (other than the Company, Tronox Worldwide or any of Tronox Worldwide'ssubsidiaries) or any of their properties or assets, except in the case of clauses (i) and (ii), such conflicts, breaches, violations,defaults, liens, charges or encumbrances as would not reasonably be expected to have a Material Adverse Effect.

(d) Prior to the Initial Delivery Time, (i) all of the rights, title and interest in and to the outstanding capital stock of TronoxWorldwide shall have been transferred to the Company free and clear of all liens, encumbrances, equities or claims, except for suchliens, encumbrances, equities or claims (A) imposed in connection with the senior secured credit facility referenced in theProspectus or (B) as could not, individually or in the aggregate, materially affect the value of such capital stock and (ii) theCompany shall be the holder of record and beneficial owner of all such capital stock (all of which has been duly authorized, validlyissued, and is fully paid and non-assessable) and the sole member under the limited liability company agreement of TronoxWorldwide.

(e) At each Delivery Time, there will be no indebtedness outstanding between the Company, Tronox Worldwide or anysubsidiary of Tronox Worldwide, on the one hand, and Parent or any subsidiary of Parent (other than the Company, TronoxWorldwide and any subsidiary of Tronox Worldwide), on the other hand.

3. Purchase of the Stock by the Underwriters. On the basis of the representations and warranties contained in, and subject to the termsand conditions of, this Agreement, the Company agrees to sell 17,480,000 shares of the Firm Stock to the several Underwriters, and each ofthe Underwriters, severally and not jointly, agrees to purchase the number of shares of the Firm Stock set forth opposite that Underwriter'sname in Schedule 1 hereto. Each Underwriter shall be obligated to purchase from the Company, that number of shares of the Firm Stock thatrepresents the same proportion of the number of shares of the Firm Stock to be sold by the Company as the number of shares of the FirmStock set forth

8



opposite the name of such Underwriter in Schedule 1 represents of the total number of shares of the Firm Stock to be purchased by all of theUnderwriters pursuant to this Agreement. The respective purchase obligations of the Underwriters with respect to the Firm Stock shall berounded among the Underwriters to avoid fractional shares, as the Representatives may determine.

In addition, the Company grants to the Underwriters an option to purchase up to 2,622,000 shares of the Option Stock. Such option isgranted for the purpose of covering over-allotments in the sale of the Firm Stock and is exercisable as provided in Section 5 hereof. EachUnderwriter agrees, severally and not jointly, to purchase the number of shares of the Option Stock (subject to such adjustments to eliminatefractional shares as the Representatives may determine) that bears the same proportion to the total number of shares of the Option Stock to besold at such Delivery Time as the number of shares of the Firm Stock set forth in Schedule 1 hereto opposite the name of such Underwriterbears to the total number of shares of the Firm Stock.

The price of both the Firm Stock and any Option Stock purchased by the Underwriters shall be $ per share.

The Company shall not be obligated to deliver any of the Firm Stock or the Option Stock to be delivered at the applicable Delivery Time,except upon payment for all such Stock to be purchased at such Delivery Time as provided herein.

4. Offering of Stock by the Underwriters. Upon authorization by the Representatives of the release of the Firm Stock, the severalUnderwriters propose to offer the Firm Stock for sale upon the terms and conditions set forth in the Prospectus.

5. Delivery of and Payment for the Stock. Delivery of and payment for the Firm Stock shall be made at the office of Akin GumpStrauss Hauer & Feld LLP, 590 Madison Avenue, New York, New York 10022 at 10:00 A.M., New York City time, on the fourth businessday following the date of this Agreement or at such other date or place as shall be determined by agreement between the Representatives andthe Company. This date and time are sometimes referred to as the "Initial Delivery Time." Delivery of the Firm Stock shall be made to theRepresentatives for the account of each Underwriter against payment by the several Underwriters through the Representatives of therespective aggregate purchase prices of the Firm Stock being sold by the Company to or upon the order of the Company by wire transfer inimmediately available funds to the accounts specified by the Company. Time shall be of the essence, and delivery at the time specifiedpursuant to this Agreement is a further condition of the obligation of each Underwriter hereunder. Delivery of the Firm Stock shall be madethrough the facilities of The Depository Trust Company unless the Representatives shall otherwise instruct.

The option granted in Section 3 will expire 30 days after the date of this Agreement and may be exercised in whole or from time to timein part by written notice being given to the Company by the Representatives; provided that if such date falls on a day that is not a businessday, the option granted in Section 3 will expire on the next succeeding business day. Such notice shall set forth the aggregate number of sharesof the Option Stock as to which the option is being exercised, the names in which the shares of the Option Stock are to be registered, thedenominations in which the shares of the Option Stock are to be issued and the date and time, as determined by the Representatives, when theshares of the Option Stock are to be delivered; provided, however, that this date and time shall not be earlier than the Initial Delivery Time norearlier than the second business day after the date on which the option shall have been exercised nor later than the fifth business day after thedate on which the option shall have been exercised. The date and time the shares of the Option Stock are delivered are sometimes referred toas an "Option Stock Delivery Time," and the Initial Delivery Time and any Option Stock Delivery Time are sometimes each referred to as a"Delivery Time."

Delivery of and payment for the Option Stock shall be made at the place specified in the first sentence of the first paragraph of thisSection 5 (or at such other place as shall be determined by agreement between

9



the Representatives and the Company) at 10:00 A.M., New York City time, at such Option Stock Delivery Time. Delivery of the Option Stockshall be made to the Representatives for the account of each Underwriter against payment by the several Underwriters through theRepresentatives of the respective aggregate purchase prices of the Option Stock being sold by the Company to or upon the order of theCompany by wire transfer in immediately available funds to the accounts specified by the Company. Time shall be of the essence, anddelivery at the time specified pursuant to this Agreement is a further condition of the obligation of each Underwriter hereunder. Delivery ofthe Option Stock shall be made through the facilities of The Depository Trust Company unless the Representatives shall otherwise instruct.

6. Further Agreements of the Company. The Company agrees:

(a) To prepare the Prospectus in a form approved by the Representatives and to file such Prospectus pursuant to Rule 424(b)under the Securities Act not later than Commission's close of business on the second business day following the execution anddelivery of this Agreement; to make no further amendment or any supplement to the Registration Statement or to the Prospectusprior to the last Delivery Time except as permitted herein; to advise the Representatives, promptly after it receives notice thereof, ofthe time when any amendment to the Registration Statement has been filed or becomes effective or any supplement to theProspectus or any amended Prospectus has been filed and to furnish the Representatives with copies thereof; to advise theRepresentatives, promptly after the Company receives notice thereof, of the issuance by the Commission of any stop order or of anyorder preventing or suspending the use of any Preliminary Prospectus or the Prospectus, of the suspension of the qualification of theStock for offering or sale in any jurisdiction, of the initiation or threatening of any proceeding for any such purpose, or of anyrequest by the Commission for the amending or supplementing of the Registration Statement or the Prospectus or for additionalinformation; and, in the event of the issuance of any stop order or of any order preventing or suspending the use of any PreliminaryProspectus or the Prospectus or suspending any such qualification, to use promptly its best efforts to obtain its withdrawal;

(b) To furnish promptly to each of the Representatives and to counsel for the Underwriters a signed copy of the RegistrationStatement as originally filed with the Commission, and each amendment thereto filed with the Commission, including all consentsand exhibits filed therewith;

(c) To deliver promptly to the Representatives such number of the following documents as the Representatives shallreasonably request: (i) conformed copies of the Registration Statement as originally filed with the Commission and each amendmentthereto (in each case excluding exhibits other than this Agreement and the computation of per share earnings) and (ii) eachPreliminary Prospectus, the Prospectus and any amended or supplemented Prospectus; and, if the delivery of a prospectus isrequired at any time after the Effective Time in connection with the offering or sale of the Stock or any other securities relatingthereto and if at such time any events shall have occurred as a result of which the Prospectus as then amended or supplementedwould include an untrue statement of a material fact or omit to state any material fact necessary in order to make the statementstherein, in the light of the circumstances under which they were made when such Prospectus is delivered, not misleading, or, if forany other reason it shall be necessary to amend or supplement the Prospectus in order to comply with the Securities Act, to notifythe Representatives and, upon their request, to prepare and furnish without charge to each Underwriter and to any dealer in securitiesas many copies as the Representatives may from time to time reasonably request of an amended or supplemented Prospectus thatwill correct such statement or omission or effect such compliance;

(d) To file promptly with the Commission any amendment to the Registration Statement or the Prospectus or any supplementto the Prospectus that may, in the judgment of the Company or the Representatives, be required by the Securities Act or requestedby the Commission;

(e) Prior to filing with the Commission any amendment to the Registration Statement or supplement to the Prospectus or anyProspectus pursuant to Rule 424(b) of the Rules and

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Regulations, to furnish a copy thereof to the Representatives and counsel for the Underwriters and obtain the consent of theRepresentatives to the filing (which consent shall not be unreasonably withheld);

(f) As soon as practicable after the Effective Date (it being understood that the Company shall have until at least 410 or, if thefourth quarter following the fiscal quarter that includes the Effective Date is the last fiscal quarter of the Company's fiscal year,455 days after the end of the Company's current fiscal quarter), to make generally available to the Company's security holders and todeliver to the Representatives an earnings statement of the Company and its subsidiaries (which need not be audited) complyingwith Section 11(a) of the Securities Act and the Rules and Regulations (including, at the option of the Company, Rule 158);

(g) Promptly from time to time to take such action as the Representatives may reasonably request to qualify the Stock foroffering and sale under the securities laws of such jurisdictions as the Representatives may request and to comply with such laws soas to permit the continuance of sales and dealings therein in such jurisdictions for as long as may be necessary to complete thedistribution of the Stock; provided that in connection therewith the Company shall not be required to (i) qualify as a foreigncorporation in any jurisdiction in which it would not otherwise be required to so qualify, (ii) file a general consent to service ofprocess in any such jurisdiction or (iii) subject itself to taxation in any jurisdiction in which it would not otherwise be subject;

(h) For a period of 180 days from the date of the Prospectus (the "Lock-Up Period"), not to, directly or indirectly, (1) offer forsale, sell, pledge or otherwise dispose of (or enter into any transaction or device that is designed to, or would reasonably be expectedto, result in the disposition by any person at any time in the future of) any shares of Common Stock or securities convertible into orexchangeable for Common Stock, or sell or grant options, rights or warrants with respect to any shares of Common Stock orsecurities convertible into or exchangeable for Common Stock, (2) enter into any swap or other derivatives transaction that transfersto another, in whole or in part, any of the economic benefits or risks of ownership of such shares of Common Stock, whether anysuch transaction described in clause (1) or (2) above is to be settled by delivery of Common Stock or other securities, in cash orotherwise, (3) file or cause to be filed a registration statement with respect to any shares of Common Stock or securities convertible,exercisable or exchangeable into Common Stock or any other securities of the Company, or (4) publicly disclose the intention to doany of the foregoing, in each case without the prior written consent of the Representatives, on behalf of the Underwriters, and tocause each officer and director of the Company set forth on Schedule 3 hereto to furnish to the Representatives, prior to the InitialDelivery Time, a letter or letters, substantially in the form of Exhibit A hereto, as the case may be (the "Lock-Up Agreements");

Notwithstanding the foregoing paragraph, if (1) during the last 17 days of the Lock-Up Period, the Company issues an earningsrelease or material news or a material event relating to the Company occurs or (2) prior to the expiration of the Lock-Up Period, theCompany announces that it will release earnings results during the 16-day period beginning on the last day of the Lock-Up Period,then the restrictions imposed in the preceding paragraph shall continue to apply until the expiration of the 18-day period beginningon the issuance of the earnings release or the announcement of the material news or the occurrence of the material event, unless theRepresentatives, on behalf of the Underwriters, waives such extension in writing.

Notwithstanding anything in this Agreement to the contrary, the restrictions in this Section 6(h) shall not apply to (i) theissuance and sale of the Stock pursuant to this Agreement, (ii) the issuance by the Company of shares of Common Stock or the grantby the Company of options, warrants or other rights pursuant to employee benefit plans disclosed in the Prospectus, (iii) the filing ofany registration statement on Form S-8 relating to the offering of Common Stock pursuant to employee benefit plans disclosed inthe Prospectus, (iv) the issuance by the Company of shares of its Class B common stock to

11



Parent or any subsidiary of Parent, or any reduction by any means in the number of shares of such Class B common stock, asdisclosed in the Prospectus, or (v) any offer, sale, pledge or other distribution of the Class B common stock of the Company issuedto Kerr-McGee Worldwide pursuant to the Master Separation Agreement or any public disclosure by the Company related thereto.

(i) To apply the net proceeds from the sale of the Stock being sold by the Company as set forth in the Prospectus.

7. Expenses. The Company agrees, whether or not the transactions contemplated by this Agreement are consummated or thisAgreement is terminated, to pay all costs, expenses, fees and taxes incident to and in connection with (a) the authorization, issuance, sale anddelivery of the Stock and any stamp duties or other taxes payable in that connection, and the preparation and printing of certificates for theStock; (b) the preparation, printing and filing under the Securities Act of the Registration Statement and any amendments and exhibits thereto,any Preliminary Prospectus, the Prospectus and any amendment or supplement to the Prospectus; (c) the distribution of the RegistrationStatement as originally filed and each amendment thereto and any post-effective amendments thereof (including, in each case, exhibits), anyPreliminary Prospectus, the Prospectus and any amendment or supplement to the Prospectus, all as provided in this Agreement; (d) theproduction and distribution of this Agreement and any other related documents in connection with the offering, purchase, sale and delivery ofthe Stock; (e) any required review by the NASD of the terms of sale of the Stock (including related fees and expenses of counsel to theUnderwriters); (f) the listing of the Stock on the New York Stock Exchange, Inc. and/or any other exchange; (g) the qualification of the Stockunder the securities laws of the several jurisdictions as provided in Section 6(g) and the preparation, printing and distribution of a Blue SkyMemorandum (including related fees and expenses of counsel to the Underwriters); (h) the investor presentations on any "road show"undertaken in connection with the marketing of the Stock, including, without limitation, expenses associated with any internet roadshow,travel and lodging expenses of the representatives and officers of the Company and the cost of any aircraft chartered in connection with theroad show; (i) any fees and expenses of the Independent Underwriter (as defined below); and (j) all other costs and expenses incident to theperformance of the obligations of the Company under this Agreement; provided that, except as provided in this Section 7 and in Section 12,the Underwriters shall pay their own costs and expenses, including the costs and expenses of their counsel, any transfer taxes on the Stockwhich they may sell and the expenses of advertising any offering of the Stock made by the Underwriters.

8. Conditions of Underwriters' Obligations. The respective obligations of the Underwriters hereunder are subject to the accuracy,when made and at each Delivery Time, in all material respects of the representations and warranties of the Company and Tronox Worldwidecontained herein (provided that representations and warranties of the Company and Tronox Worldwide contained herein that are qualified asto materiality shall be accurate in all respects), to the performance by the Company, Tronox Worldwide and Parent of their respectiveobligations hereunder, and to each of the following additional terms and conditions:

(a) The Prospectus shall have been timely filed with the Commission in accordance with Section 6(a); no stop ordersuspending the effectiveness of the Registration Statement or preventing or suspending the use of the Prospectus shall have beenissued and no proceeding for such purpose shall have been initiated or, to the Company's knowledge, threatened by the Commission;and any request of the Commission for inclusion of additional information in the Registration Statement or the Prospectus orotherwise shall have been complied with.

(b) No Underwriter shall have discovered and disclosed to the Company on or prior to such Delivery Time that theRegistration Statement or the Prospectus or any amendment or supplement thereto contains an untrue statement of a fact which, inthe opinion of Akin Gump Strauss Hauer & Feld LLP, counsel for the Underwriters, is material or omits to state a fact which, in theopinion of

12



such counsel, is material and is required to be stated therein or is necessary to make the statements therein not misleading.

(c) All corporate proceedings and other legal matters incident to the authorization, form and validity of this Agreement, theSeparation Agreements, the Stock, the Registration Statement and the Prospectus, and all other legal matters relating to thisAgreement and the transactions contemplated hereby and thereby shall be reasonably satisfactory in all material respects to counselfor the Underwriters, and the Company shall have furnished to such counsel all documents and information that they mayreasonably request to enable them to pass upon such matters.

(d) Covington & Burling LLP shall have furnished to the Representatives its written opinion, as counsel to the Company andParent, addressed to the Underwriters and dated the date of such Delivery Time, in form and substance reasonably satisfactory to theRepresentatives, substantially in the form attached hereto as Exhibit B.

(e) Roger G. Addison, Esq., General Counsel of the Company, shall have furnished to the Representatives his written opinion,addressed to the Underwriters and dated the date of such Delivery Time, in form and substance reasonably satisfactory to theRepresentatives, substantially in the form attached hereto as Exhibit C.

(f) Foreign counsel reasonably satisfactory to the Representatives shall have furnished to the Representatives their writtenopinions, as counsel to the Company and its Foreign Subsidiaries (as defined in Section 18), addressed to the Underwriters anddated the date of such Delivery Time, in form and substance satisfactory to the Representatives, to the effect, and to the extent suchlegal concepts or substantially similar legal concepts exist in such foreign jurisdiction, that each of the Foreign Subsidiaries has beenduly incorporated and is validly existing as a corporation in good standing under the laws of its jurisdiction of incorporation, that allof the issued shares of capital stock of such subsidiaries have been duly and validly authorized and issued, are fully paid and non-assessable, and all of the issued shares of capital stock of such subsidiaries are owned directly or indirectly by the Company and, tothe best of counsel's knowledge, are free and clear of all liens, encumbrances or claims except such liens, encumbrances or claims(i) imposed in connection with the senior secured credit facility described in the Prospectus or (ii) as do not materially affect thevalue of such shares of capital stock.

(g) The Representatives shall have received from Akin Gump Strauss Hauer & Feld LLP, counsel for the Underwriters, suchopinion or opinions, dated the date of such Delivery Time, with respect to the issuance and sale of the Stock, the RegistrationStatement, the Prospectus and other related matters as the Representatives may reasonably require, and the Company shall havefurnished to such counsel such documents as they reasonably request for the purpose of enabling them to pass upon such matters.

(h) At the time of execution of this Agreement, the Representatives shall have received from Ernst & Young a letter, in formand substance reasonably satisfactory to the Representatives, addressed to the Underwriters and dated the date hereof (i) confirmingthat they are independent public accountants within the meaning of the Securities Act and are in compliance with the applicablerequirements relating to the qualification of accountants under Rule 2-01 of Regulation S-X of the Commission, (ii) stating, as of thedate hereof (or, with respect to matters involving changes or developments since the respective dates as of which specified financialinformation is given in the Prospectus, as of a date not more than three business days prior to the date hereof), the conclusions andfindings of such firm with respect to the financial information and other matters ordinarily covered by accountants' "comfort letters"to underwriters in connection with registered public offerings.

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(i) With respect to the letter of Ernst & Young referred to in the preceding paragraph and delivered to the Representativesconcurrently with the execution of this Agreement (the "initial letter"), the Company shall have furnished to the Representatives aletter (the "bring-down letter") of such accountants, addressed to the Underwriters and dated the date of such Delivery Time(i) confirming that they are independent public accountants within the meaning of the Securities Act and are in compliance with theapplicable requirements relating to the qualification of accountants under Rule 2-01 of Regulation S-X of the Commission,(ii) stating, as of the date of the bring-down letter (or, with respect to matters involving changes or developments since therespective dates as of which specified financial information is given in the Prospectus, as of a date not more than three business daysprior to the date of the bring-down letter), the conclusions and findings of such firm with respect to the financial information andother matters covered by the initial letter and (iii) confirming in all material respects the conclusions and findings set forth in theinitial letter.

(j) The representations and warranties of the Company and Tronox Worldwide in Section 1 are true and correct in all materialrespects (provided that representations and warranties of the Company and Tronox Worldwide contained herein that are qualified asto materiality shall be true and correct in all respects) on and as of such Delivery Time, and each of the Company and TronoxWorldwide has complied with all its agreements contained herein and satisfied all the conditions on its part to be performed orsatisfied hereunder at or prior to such Delivery Time.

(k) Each of the Company and Tronox Worldwide shall have furnished to the Representatives a certificate, dated the date ofsuch Delivery Time, of its Chief Executive Officer or its Chief Financial Officer stating that:

(i) No stop order suspending the effectiveness of the Registration Statement has been issued, and no proceedingsfor that purpose have been instituted or, to the knowledge of such officer, threatened;

(ii) Such officer has carefully examined the Registration Statement and the Prospectus and, in such officer's opinion,(A) the Registration Statement, as of the Effective Time, and the Prospectus, as of its date and as of such Delivery Time,did not and do not contain any untrue statement of a material fact and did not and do not omit to state a material factrequired to be stated therein or necessary to make the statements therein (in the case of the Prospectus, in the light of thecircumstances under which they were made) not misleading, and (B) since the Effective Time, no event has occurred thatshould have been set forth in a supplement or amendment to the Registration Statement or the Prospectus that has not beenso set forth; and

(iii) Each of the conditions set forth in this Section 8 have been satisfied in full.

(l) Parent shall have furnished to the Representatives a certificate, dated such Delivery Time, of an authorized officer ofParent stating that the representations and warranties of Parent in Section 2 are true and correct in all material respects (or, in thecase of the representations and warranties of Parent contained herein that are qualified as to materiality, that such representationsand warranties shall be true and correct in all respects) on and as of such Delivery Time.

(m) Each of the Company, Tronox Worldwide, Parent and Kerr-McGee Worldwide shall have furnished to the Representativesa certificate, dated the date of such Delivery Time, of its Secretary certifying as of such Delivery Time as to the incumbency andsignatures of the officers or representatives of such entity authorized to sign, as applicable, the Separation Agreements, thisAgreement and the other documents delivered hereunder, together with evidence of the incumbency of such Secretary.

(n) Each of the conditions precedent to the obligations of the initial purchasers under that certain purchase agreement amongTronox Worldwide, Tronox Finance, Lehman Brothers Inc. and Credit Suisse First Boston LLC to purchase the unsecured notes ofTronox Worldwide and Tronox

14



Finance Corp., other than the consummation of the offer and sale of the Stock pursuant hereto, shall have been satisfied in full; andconcurrently with the consummation of the offer and sale of the Stock, Tronox Worldwide and Tronox Finance shall issue and sellnot less than $350 million in aggregate principal amount of unsecured notes.

(o) The Company and Tronox Worldwide shall have executed and delivered that certain Credit Agreement with LehmanCommercial Paper Inc., as administrative agent; each of the conditions precedent to the obligations of the lenders thereunder tomake loans in accordance with the terms thereof, other than the consummation of the offer and sale of the Stock pursuant hereto,shall have been satisfied in full; and concurrently with the consummation of the offer and sale of the Stock, Tronox Worldwide shallreceive the net proceeds of term loans under such credit agreement in an aggregate principal amount equal to not less than$200 million.

(p) Except as set forth in or contemplated by the Prospectus, including the pro forma financial and capitalization informationincluded therein, since the date of the latest audited financial statements included in the Prospectus, (i) neither the Company, TronoxWorldwide nor any of Tronox Worldwide's subsidiaries shall have sustained any loss or interference with its business from fire,explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action,order or decree and (ii) there shall not have been any change in the capital stock or long-term debt of the Company, TronoxWorldwide or any of Tronox Worldwide's subsidiaries or any adverse change, or any development involving a prospective adversechange, in or affecting the condition (financial or otherwise), results of operations, stockholders' equity, properties or business of theCompany, Tronox Worldwide or any of Tronox Worldwide's subsidiaries, taken as a whole, the effect of which, in any such casedescribed in clause (i) or (ii), is, in the reasonable judgment of the Representatives, so material and adverse as to make itimpracticable or inadvisable to proceed with the public offering or the delivery of the Stock being delivered at such Delivery Timeon the terms and in the manner contemplated in the Prospectus.

(q) Subsequent to the execution and delivery of this Agreement there shall not have occurred any of the following: (i) tradingin securities generally on the New York Stock Exchange or the American Stock Exchange or in the over-the-counter market, ortrading in any securities of the Company on any exchange or in the over-the-counter market, shall have been suspended ormaterially limited or the settlement of such trading generally shall have been materially disrupted or minimum prices shall havebeen established on any such exchange or such market by the Commission, by such exchange or by any other regulatory body orgovernmental authority having jurisdiction, (ii) a banking moratorium shall have been declared by federal or state authorities,(iii) the United States shall have become engaged in hostilities, there shall have been an escalation in hostilities involving the UnitedStates or there shall have been a declaration of a national emergency or war by the United States or (iv) there shall have occurredsuch a material adverse change in general economic, political or financial conditions, including, without limitation, as a result ofterrorist activities after the date hereof (or the effect of international conditions on the financial markets in the United States shall besuch), as to make it, in the judgment of the Representatives, impracticable or inadvisable to proceed with the public offering ordelivery of the Stock being delivered at such Delivery Time on the terms and in the manner contemplated in the Prospectus.

(r) The New York Stock Exchange shall have approved the Stock for listing, subject only to official notice of issuance andevidence of satisfactory distribution.

(s) The Lock-Up Agreements between the Representatives and Parent and the Representatives and the officers and directors ofthe Company set forth on Schedule 3, delivered to the Representatives on or before the date of this Agreement, shall be in full forceand effect at such Delivery Time.

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All opinions, letters, evidence and certificates mentioned above or elsewhere in this Agreement shall be deemed to be in compliance withthe provisions hereof only if they are in form and substance reasonably satisfactory to counsel for the Underwriters.

9. Indemnification and Contribution.

(a) The Company and Tronox Worldwide, jointly and severally, shall indemnify and hold harmless each Underwriter, itsdirectors, officers and employees and each person, if any, who controls any Underwriter within the meaning of Section 15 of theSecurities Act, from and against any loss, claim, damage or liability, joint or several, or any action in respect thereof (including, butnot limited to, any loss, claim, damage, liability or action relating to purchases and sales of the Stock), to which that Underwriter,director, officer, employee or controlling person may become subject, under the Securities Act or otherwise, insofar as such loss,claim, damage, liability or action arises out of, or is based upon, (i) any untrue statement or alleged untrue statement of a materialfact contained (A) in any Preliminary Prospectus, the Registration Statement or the Prospectus or in any amendment or supplementthereto or (B) in any materials or information provided to investors by, or with the written approval of, the Company in connectionwith the marketing of the offering of the Stock ("Marketing Materials"), including any road show or investor presentations made toinvestors by the Company (whether in person or electronically), (ii) the omission or alleged omission to state in any PreliminaryProspectus, the Registration Statement or the Prospectus, or in any amendment or supplement thereto or any Marketing Materials,any material fact required to be stated therein or necessary to make the statements therein not misleading or (iii) any act or failure toact or any alleged act or failure to act by any Underwriter in connection with, or relating in any manner to, the Stock or the offeringcontemplated hereby, and which is included as part of or referred to in any loss, claim, damage, liability or action arising out of orbased upon matters covered by clause (i) or (ii) above (provided that neither the Company nor Tronox Worldwide shall be liableunder this clause (iii) to the extent that it is determined in a final judgment by a court of competent jurisdiction that such loss, claim,damage, liability or action resulted directly from any such acts or failures to act undertaken or omitted to be taken by suchUnderwriter through its gross negligence or willful misconduct), and shall reimburse each Underwriter and each such director,officer, employee or controlling person promptly upon demand for any legal or other expenses reasonably incurred by thatUnderwriter, director, officer, employee or controlling person in connection with investigating or defending or preparing to defendagainst any such loss, claim, damage, liability or action as such expenses are incurred; provided, however, that the neither Companynor Tronox Worldwide shall be liable in any such case to the extent that any such loss, claim, damage, liability or action arises outof, or is based upon, any untrue statement or alleged untrue statement or omission or alleged omission made in any PreliminaryProspectus, the Registration Statement or the Prospectus, or in any such amendment or supplement, in reliance upon and inconformity with written information concerning such Underwriter furnished to the Company through the Representatives by or onbehalf of any Underwriter specifically for inclusion therein, which information consists solely of the information specified inSection 9(f). The foregoing indemnity agreement is in addition to any liability which the Company may otherwise have to anyUnderwriter or to any director, officer, employee or controlling person of that Underwriter.

(b) The Parent shall indemnify and hold harmless each Underwriter, its directors, officers and employees and each person, ifany, who controls any Underwriter within the meaning of Section 15 of the Securities Act, from and against any loss, claim, damageor liability, joint or several, or any action in respect thereof (including, but not limited to, any loss, claim, damage, liability or actionrelating to purchases and sales of the Stock), to which that Underwriter, director, officer, employee or controlling person maybecome subject, under the Securities Act or otherwise, insofar as such loss, claim, damage, liability or action arises out of, or isbased upon, a breach of any of the representations set forth in Section 2. The foregoing indemnity agreement is in addition to anyliability which the Parent may

16



otherwise have to any Underwriter or to any director, officer, employee or controlling person of that Underwriter.

(c) Each Underwriter, severally and not jointly, shall indemnify and hold harmless the Company, Tronox Worldwide, theirrespective directors, officers and employees, and each person, if any, who controls the Company within the meaning of Section 15of the Securities Act, from and against any loss, claim, damage or liability, joint or several, or any action in respect thereof, to whichthe Company, Tronox Worldwide or any such director, officer, employee or controlling person may become subject, under theSecurities Act or otherwise, insofar as such loss, claim, damage, liability or action arises out of, or is based upon, (i) any untruestatement or alleged untrue statement of a material fact contained in any Preliminary Prospectus, the Registration Statement or theProspectus or in any amendment or supplement thereto, or any Marketing Materials, or (ii) the omission or alleged omission to statein any Preliminary Prospectus, the Registration Statement or the Prospectus, or in any amendment or supplement thereto, or anyMarketing Materials, any material fact required to be stated therein or necessary to make the statements therein not misleading, butin each case only to the extent that the untrue statement or alleged untrue statement or omission or alleged omission was made inreliance upon and in conformity with written information concerning such Underwriter furnished to the Company through theRepresentatives by or on behalf of that Underwriter specifically for inclusion therein, which information is limited to theinformation set forth in Section 9(f) and shall reimburse the Company, Tronox Worldwide and any such director, officer orcontrolling person for any legal or other expenses reasonably incurred by the Company, Tronox Worldwide or any such director,officer or controlling person in connection with investigating or defending or preparing to defend against any such loss, claim,damage, liability or action as such expenses are incurred. The foregoing indemnity agreement is in addition to any liability that anyUnderwriter may otherwise have to the Company, Tronox Worldwide or any such director, officer, employee or controlling person.

(d) Promptly after receipt by an indemnified party under this Section 9 of notice of any claim or the commencement of anyaction, the indemnified party shall, if a claim in respect thereof is to be made against the indemnifying party under this Section 9,notify the indemnifying party in writing of the claim or the commencement of that action; provided, however, that the failure tonotify the indemnifying party shall not relieve it from any liability which it may have under this Section 9 except to the extent it hasbeen materially prejudiced by such failure and, provided, further, that the failure to notify the indemnifying party shall not relieve itfrom any liability which it may have to an indemnified party otherwise than under this Section 9. If any such claim or action shall bebrought against an indemnified party, and it shall notify the indemnifying party thereof, the indemnifying party shall be entitled toparticipate therein and, to the extent that it wishes, jointly with any other similarly notified indemnifying party, to assume thedefense thereof with counsel reasonably satisfactory to the indemnified party. After notice from the indemnifying party to theindemnified party of its election to assume the defense of such claim or action, the indemnifying party shall not be liable to theindemnified party under this Section 9 for any legal or other expenses subsequently incurred by the indemnified party in connectionwith the defense thereof other than reasonable costs of investigation; provided, however, that the Representatives shall have the rightto employ counsel to represent jointly the Representatives and those other Underwriters and their respective directors, officers,employees and controlling persons who may be subject to liability arising out of any claim in respect of which indemnity may besought by the Underwriters against the Company or Parent under this Section 9 if (i) the Company, Parent and the Underwritersshall have so mutually agreed; (ii) the Company or Parent has failed within a reasonable time to retain counsel reasonablysatisfactory to the Underwriters; (iii) the Underwriters and their respective directors, officers, employees and controlling personsshall have reasonably concluded that there may be legal defenses available to them that are different from or in addition to thoseavailable to the Company or Parent; or (iv) the named parties in any such proceeding (including any impleaded parties) include boththe Underwriters or their

17



respective directors, officers, employees or controlling persons, on the one hand, and the Company and Parent, on the other hand,and representation of both sets of parties by the same counsel would be inappropriate due to actual or potential differing interestsbetween them, and in any such event the fees and expenses of such separate counsel shall be paid by the Company and Parent. Noindemnifying party shall (i) without the prior written consent of the indemnified parties (which consent shall not be unreasonablywithheld), settle or compromise or consent to the entry of any judgment with respect to any pending or threatened claim, action, suitor proceeding in respect of which indemnification or contribution may be sought hereunder (whether or not the indemnified partiesare actual or potential parties to such claim or action) unless such settlement, compromise or consent includes an unconditionalrelease of each indemnified party from all liability arising out of such claim, action, suit or proceeding and does not include anyfindings of fact or admissions of fault or culpability as to the indemnified party, or (ii) be liable for any settlement of any such actioneffected without its written consent (which consent shall not be unreasonably withheld), but if settled with the consent of theindemnifying party or if there be a final judgment of the plaintiff in any such action, the indemnifying party agrees to indemnify andhold harmless any indemnified party from and against any loss or liability by reason of such settlement or judgment.

(e) If the indemnification provided for in this Section 9 shall for any reason be unavailable to or insufficient to hold harmlessan indemnified party under Section 9(a), 9(b), 9(c) or 9(g) in respect of any loss, claim, damage or liability, or any action in respectthereof, referred to therein, then each indemnifying party shall, in lieu of indemnifying such indemnified party, contribute to theamount paid or payable by such indemnified party as a result of such loss, claim, damage or liability, or action in respect thereof,(i) in such proportion as shall be appropriate to reflect the relative benefits received by the Company and Parent, on the one hand,and the Underwriters, on the other, from the offering of the Stock or (ii) if the allocation provided by clause (i) above is notpermitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i)above but also the relative fault of the Company, on the one hand, and the Underwriters, on the other, with respect to the statementsor omissions that resulted in such loss, claim, damage or liability, or action in respect thereof, as well as any other relevant equitableconsiderations. The relative benefits received by the Company and Parent, on the one hand, and the Underwriters, on the other, withrespect to such offering shall be deemed to be in the same proportion as the total net proceeds from the offering of the Stockpurchased under this Agreement (before deducting expenses) received by the Company, as set forth in the table on the cover page ofthe Prospectus, on the one hand, and the total underwriting discounts and commissions received by the Underwriters with respect tothe shares of the Stock purchased under this Agreement, as set forth in the table on the cover page of the Prospectus, on the otherhand, bear to the total gross proceeds from the offering of the shares of the Stock under this Agreement, as set forth in the table onthe cover page of the Prospectus. The relative fault shall be determined by reference to whether the untrue or alleged untruestatement of a material fact or omission or alleged omission to state a material fact relates to information supplied by the Companyor the Underwriters, the intent of the parties and their relative knowledge, access to information and opportunity to correct orprevent such statement or omission. The Company, Parent and the Underwriters agree that it would not be just and equitable ifcontributions pursuant to this Section 9(e) were to be determined by pro rata allocation (even if the Underwriters were treated as oneentity for such purpose) or by any other method of allocation which does not take into account the equitable considerations referredto herein. The amount paid or payable by an indemnified party as a result of the loss, claim, damage or liability, or action in respectthereof, referred to above in this Section 9(e) shall be deemed to include, for purposes of this Section 9(e), any legal or otherexpenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim.Notwithstanding the provisions of this Section 9(e), no Underwriter shall be required to contribute any amount in excess of theamount by which the total price at which the Stock underwritten by it and distributed to the public was offered to the public exceedsthe amount of any

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damages which such Underwriter has otherwise paid or become liable to pay by reason of any untrue or alleged untrue statement oromission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of theSecurities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. TheUnderwriters' obligations to contribute as provided in this Section 9(e) are several in proportion to their respective underwritingobligations and not joint.

(f) The Underwriters severally confirm, and the Company, Tronox Worldwide and Parent acknowledge and agree, that thestatements with respect to the public offering of the Stock by the Underwriters set forth on the cover page of, and the concession andreallowance figures and the paragraph relating to stabilization by the Underwriters appearing under the caption "Underwriting" in,the Prospectus are correct and constitute the only information concerning such Underwriters furnished in writing to the Company byor on behalf of the Underwriters specifically for inclusion in the Registration Statement and the Prospectus.

(g) Without limitation of and in addition to its obligations under the other paragraphs of this Section 9, the Company andTronox Worldwide agree to indemnify and hold harmless Friedman, Billings, Ramsey & Co., Inc. (in the capacity described in thisparagraph, the "Independent Underwriter"), its directors, officers and employees and each person who controls IndependentUnderwriter within the meaning of Section 15 of the Securities Act from and against any loss, claim, damage or liability, joint orseveral, or any action in respect thereof (including, but not limited to, any loss, claim, damage, liability or action relating topurchases and sales of Stock) to which the Independent Underwriter, director, officer, employee or controlling person may becomesubject, under the Securities Act or otherwise, insofar as such loss, claim, damage, liability or action arises out of, or is based upon,the Independent Underwriter's acting as a "qualified independent underwriter" (within the meaning of NASD Conduct Rule 2720) inconnection with the offering contemplated by this Agreement, and agrees to reimburse each such indemnified party promptly upondemand for any legal or other expenses reasonably incurred by them in connection with investigating or defending or preparing todefend any such loss, claim, damage, liability or action; provided, however, that neither the Company nor Tronox Worldwide shallbe liable in any such case to the extent that it is determined in a final judgment by a court of competent jurisdiction that such loss,claim, damage, liability or action resulted directly from the gross negligence or willful misconduct of the Independent Underwriter.The relative benefits received by the Independent Underwriter with respect to the offering contemplated by this Agreement shall, forpurposes of Section 9(e), deemed to be equal to the compensation received by the Independent Underwriter for acting in suchcapacity. In addition, notwithstanding the provisions of Section 9(e), the Independent Underwriter shall not be required to contributeany amount in excess of the compensation received by the Independent Underwriter for acting in such capacity.

10. Defaulting Underwriters. If, at any Delivery Time, any Underwriter defaults in the performance of its obligations under thisAgreement, the remaining non-defaulting Underwriters shall be obligated to purchase the Stock that the defaulting Underwriter agreed butfailed to purchase at such Delivery Time in the respective proportions which the number of shares of the Firm Stock set forth opposite thename of each remaining non-defaulting Underwriter in Schedule 1 hereto bears to the total number of shares of the Firm Stock set forthopposite the names of all the remaining non-defaulting Underwriters in Schedule 1 hereto; provided, however, that the remaining non-defaulting Underwriters shall not be obligated to purchase any of the Stock at such Delivery Time if the total number of shares of the Stockwhich the defaulting Underwriter or Underwriters agreed but failed to purchase on such date exceeds 9.09% of the total number of shares ofthe Stock to be purchased at such Delivery Time, and any remaining non-defaulting Underwriter shall not be obligated to purchase more than110% of the number of shares of the Stock which it agreed to purchase at such Delivery Time pursuant to the terms of Section 3. If theforegoing maximums are exceeded, the remaining non-defaulting Underwriters, or those other

19



underwriters satisfactory to the Representatives who so agree, shall have the right, but shall not be obligated, to purchase, in such proportionas may be agreed upon among them, all the Stock to be purchased on such Delivery Time. If the remaining Underwriters or other underwriterssatisfactory to the Representatives do not elect to purchase the shares that the defaulting Underwriter or Underwriters agreed but failed topurchase on such Delivery Time, this Agreement (or, with respect to any Option Stock Delivery Time, the obligation of the Underwriters topurchase, and of the Company to sell, the Option Stock) shall terminate without liability on the part of any non-defaulting Underwriter, theCompany or Parent, except that the Company will continue to be liable for the payment of expenses to the extent set forth in Sections 7 and 12and Parent will continue to be liable for the payment of expenses to the extent set forth in Section 12. As used in this Agreement, the term"Underwriter" includes, for all purposes of this Agreement unless the context requires otherwise, any party not listed in Schedule 1 heretothat, pursuant to this Section 9, purchases the Stock that a defaulting Underwriter agreed but failed to purchase.

Nothing contained herein shall relieve a defaulting Underwriter of any liability it may have to the Company or Parent for damages causedby its default. If other Underwriters are obligated or agree to purchase the Stock of a defaulting or withdrawing Underwriter, either theRepresentatives or the Company may postpone the Delivery Time for up to seven full business days in order to effect any changes that in theopinion of counsel for the Company or counsel for the Underwriters may be necessary in the Registration Statement, the Prospectus or in anyother document or arrangement.

11. Termination. The obligations of the Underwriters hereunder may be terminated by the Representatives by notice given to andreceived by the Company prior to delivery of and payment for the Firm Stock if, prior to that time, any of the events described in Sections 8(p)and 8(q) shall have occurred or if the Underwriters shall decline to purchase the Stock for any reason permitted under this Agreement.

12. Reimbursement of Underwriters' Expenses. If the Company shall fail to tender the Stock for delivery to the Underwriters byreason of any failure, refusal or inability on the part of the Company to perform any agreement on its part to be performed, or because anyother condition of the Underwriters' obligations hereunder required to be fulfilled by the Company is not fulfilled, the Company and Parentwill reimburse the Underwriters for all reasonable out-of-pocket expenses (including fees and disbursements of counsel) incurred by theUnderwriters in connection with this Agreement and the proposed purchase of the Stock, and upon demand the Company and Parent shall paythe full amount thereof to the Representatives. If this Agreement is terminated pursuant to Section 9 by reason of the default of one or moreUnderwriters, neither the Company nor Parent shall be obligated to reimburse any defaulting Underwriter on account of those expenses.

13. Research Independence. In addition, the Company and Parent acknowledge that the Underwriters' research analysts and researchdepartments are required to be independent from their respective investment banking divisions and are subject to certain regulations andinternal policies, and that such Underwriters' research analysts may hold and make statements or investment recommendations and/or publishresearch reports with respect to the Company and/or the offering that differ from the views of its investment bankers. The Company andParent hereby waive and release, to the fullest extent permitted by law, any claims that the Company or Parent may have against theUnderwriters with respect to any conflict of interest that may arise from the fact that the views expressed by their independent researchanalysts and research departments may be different from or inconsistent with the views or advice communicated to the Company or Parent bysuch Underwriters' investment banking divisions. The Company and Parent acknowledge that each of the Underwriters is a full servicesecurities firm and as such from time to time, subject to applicable securities laws, may effect transactions for its own account or the accountof its customers and hold long or short positions in debt or equity securities of the companies which may be the subject of the transactionscontemplated by this Agreement.

14. No fiduciary duty. Each of the Company and Parent acknowledges and agrees that in connection with this offering, sale of theStock or any other services the Underwriters may be deemed to

20



be providing hereunder, notwithstanding any preexisting relationship, advisory or otherwise, between the parties or any oral representations orassurances previously or subsequently made by the Underwriters: (i) no fiduciary or agency relationship between the Company, Parent andany other person, on the one hand, and the Underwriters, on the other, exists; (ii) the Underwriters are not acting as advisors, expert orotherwise, to the Company or Parent in connection with the offering contemplated hereby, including, without limitation, with respect to thedetermination of the public offering price of the Stock, and such relationship between the Company and Parent, on the one hand, and theUnderwriters, on the other, is entirely and solely commercial, based on arms-length negotiations; (iii) any duties and obligations that theUnderwriters may have to the Company shall be limited to those duties and obligations specifically stated herein; and (iv) the Underwritersand their respective affiliates may have interests that differ from those of the Company and Parent. Each of the Company and Parent herebywaives any claims that the Company or Parent may have against the Underwriters with respect to any breach of fiduciary duty in connectionwith the Offering.

15. Notices, Etc. All statements, requests, notices and agreements hereunder shall be in writing, and:

(a) if to the Underwriters, shall be delivered or sent by mail, telex or facsimile transmission to Lehman Brothers Inc.,745 Seventh Avenue, 19th Floor, New York, New York 10019, Attention: Syndicate Department (Fax: 212-526-0943), with a copy,in the case of any notice pursuant to Section 9(c), to the Director of Litigation, Office of the General Counsel, Lehman Brothers Inc.,399 Park Avenue, 10th Floor, New York, New York 10022 (Fax: 212-526-2648);

(b) if to the Company or Tronox Worldwide, shall be delivered or sent by mail, telex or facsimile transmission to TronoxIncorporated, 123 Robert S. Kerr Avenue, Oklahoma City, Oklahoma 73102, Attention Roger G. Addison, Esq., (Fax:(405) 270-4101); and

(c) if to Parent, shall be delivered or sent by mail, telex or facsimile transmission to Kerr-McGee Corporation, 123 Robert S.Kerr Avenue, Oklahoma City, Oklahoma 73102, Attention Gregory F. Pilcher, Esq., (Fax: (405) 270-3649).

provided, however, that any notice to an Underwriter pursuant to Section 9(c) shall be delivered or sent by mail, telex or facsimiletransmission to such Underwriter at its address set forth in its acceptance telex to the Representatives, which address will be supplied to anyother party hereto by the Representatives upon request. Any such statements, requests, notices or agreements shall take effect at the time ofreceipt thereof. The Company shall be entitled to act and rely upon any request, consent, notice or agreement given or made on behalf of theUnderwriters by Lehman Brothers Inc. on behalf of the Representatives.

16. Persons Entitled to Benefit of Agreement. This Agreement shall inure to the benefit of and be binding upon the Underwriters, theCompany, Parent and their respective successors. This Agreement and the terms and provisions hereof are for the sole benefit of only thosepersons, except that (a) the representations, warranties, indemnities and agreements of the Company and Parent contained in this Agreementshall also be deemed to be for the benefit of the directors, officers and employees of the Underwriters and each person or persons, if any, whocontrol any Underwriter within the meaning of Section 15 of the Securities Act and (b) the indemnity agreement of the Underwriters containedin Section 9(b) of this Agreement shall be deemed to be for the benefit of the directors of the Company, the officers of the Company who havesigned the Registration Statement and any person controlling the Company within the meaning of Section 15 of the Securities Act. Nothing inthis Agreement is intended or shall be construed to give any person, other than the persons referred to in this Section 16, any legal or equitableright, remedy or claim under or in respect of this Agreement or any provision contained herein.

17. Survival. The respective indemnities, representations, warranties and agreements of the Company, Parent and the Underwriterscontained in this Agreement or made by or on behalf of them, respectively, pursuant to this Agreement, shall survive the delivery of andpayment for the Stock and shall

21



remain in full force and effect, regardless of any investigation made by or on behalf of any of them or any person controlling any of them.

18. Definition of the Terms "Business Day" and "Subsidiary". For purposes of this Agreement, (a) "business day" means eachMonday, Tuesday, Wednesday, Thursday or Friday that is not a day on which banking institutions in New York are generally authorized orobligated by law or executive order to close, (b) "subsidiary" has the meaning set forth in Rule 405 of the Rules and Regulations,(c) "Significant Subsidiaries" means the entities, other than Tronox Worldwide, listed on Part II of Schedule 2 hereto and (d) "ForeignSubsidiaries" means the entities listed on Schedule 4 hereto.

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

20. Counterparts. This Agreement may be executed in one or more counterparts and, if executed in more than one counterpart, theexecuted counterparts shall each be deemed to be an original but all such counterparts shall together constitute one and the same instrument.

21. Headings. The headings herein are inserted for convenience of reference only and are not intended to be part of, or to affect themeaning or interpretation of, this Agreement.

[Signature page follows]

22



If the foregoing correctly sets forth the agreement among the Company, Tronox Worldwide, Parent and the Underwriters, please indicateyour acceptance in the space provided for that purpose below.

Very truly yours,

TRONOX INCORPORATED

By:

Name:Title:

TRONOX WORLDWIDE LLC

By:

Name:Title:

KERR-MCGEE CORPORATION

By:

Name:Title:

[Signature Page 1 to Underwriting Agreement]



Accepted:

LEHMAN BROTHERS INC.J.P. MORGAN SECURITIES INC.

For themselves and as Representativesof the several Underwriters namedin Schedule 1 hereto

LEHMAN BROTHERS INC.

By:Name:Title:

J.P. MORGAN SECURITIES INC.

By:Name:Title:

[Signature Page 2 to Underwriting Agreement]



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EXHIBIT 1.1TRONOX INCORPORATED 17,480,000 Shares of Class A Common Stock FORM OF UNDERWRITING AGREEMENT




EXHIBIT 5.1

Covington & BurlingNovember 18, 2005

1201 PENNSYLVANIA AVENUE NW

WASHINGTON, DC 20004-2401

TEL 202.662.6000

FAX 202.662.6291

WWW.COV.COM

WASHINGTON

NEW YORK

SAN FRANCISCO

LONDON

BRUSSELS

Tronox Incorporated123 Robert S. Kerr AvenueOklahoma City, Oklahoma 73102

Re: Tronox IncorporatedRegistration Statement on Form S-1 (File No. 333-125574)

Ladies & Gentlemen:

We are acting as counsel to Tronox Incorporated, a Delaware corporation (the "Company"), in connection with the registration by theCompany under the Securities Act of 1933 (the "Act") of a public offer and sale of shares of Class A Common Stock, $0.01 par value pershare (including the associated preferred share purchase rights), of the Company (the "Shares") pursuant to the above-referenced registrationstatement filed with the Securities and Exchange Commission ("SEC") (such registration statement, as amended, is herein referred to as the"Registration Statement").

We have reviewed such corporate records, certificates and other documents, and such questions of law, as we have considered necessaryor appropriate for the purposes of this opinion. We have assumed that all signatures are genuine, that all documents submitted to us asoriginals are authentic and that all copies of documents submitted to us conform to the originals. We have relied as to certain factual matterson information obtained from public officials, officers of the Company, and other sources believed by us to be responsible.

Based upon the foregoing, we are of the opinion that the Shares have been duly authorized by all requisite corporate action and, whenduly issued and sold as contemplated in the Registration Statement, will be validly issued, fully paid and nonassessable.

We are members of the bar of the District of Columbia. We do not express any opinion herein on any laws other than the DelawareGeneral Corporation Law, applicable provisions of the Delaware Constitution and reported judicial decisions interpreting these laws.

We hereby consent to the filing of this opinion as an exhibit to the Registration Statement. We also hereby consent to the use of our nameas counsel under "Legal Matters" in the prospectus constituting part of the Registration Statement. In giving such consent, we do not therebyadmit that we are in the category of persons whose consent is required under Section 7 of the Act or the rules and regulations of the SEC.

Very truly yours,

/s/ Covington & Burling

Covington & Burling



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EXHIBIT 5.1




EXHIBIT 10.10

$450,000,000

FORM OF CREDIT AGREEMENTamong

TRONOX INCORPORATED,TRONOX WORLDWIDE LLC,

as Borrower,The Several Lenders

from Time to Time Parties Hereto,LEHMAN BROTHERS INC.

andCREDIT SUISSE,

as Arrangersand

Bookrunners,

ABN Amro Bank N.V.,as Syndication Agent

JPMorgan Chase Bank, N.A.and

Citicorp North America, Inc.as Co-Documentation Agents

andLEHMAN COMMERCIAL PAPER INC.,

as Administrative Agent

Dated as of November , 2005



TABLE OF CONTENTS

Page

SECTION 1. DEFINITIONS 11.1 Defined Terms 11.2 Other Definitional Provisions 24

SECTION 2. AMOUNT AND TERMS OF COMMITMENTS 242.1 Tranche A Term Loan Commitments 242.2 Procedure for Tranche A Term Loan Borrowing 252.3 Repayment of Tranche A Term Loans 252.4 Revolving Credit Commitments 252.5 Procedure for Revolving Credit Borrowing 262.6 Swing Line Commitment 262.7 Procedure for Swing Line Borrowing; Refunding of Swing Line Loans 272.8 Repayment of Loans; Evidence of Debt 282.9 Commitment Fees, etc 292.10 Termination or Reduction of Commitments 292.11 Optional Prepayments 292.12 Mandatory Prepayments 302.13 Conversion and Continuation Options 312.14 Minimum Amounts and Maximum Number of LIBO Rate Tranches 312.15 Interest Rates and Payment Dates 322.16 Computation of Interest and Fees 322.17 Inability to Determine Interest Rate 332.18 Pro Rata Treatment and Payments 332.19 Requirements of Law 342.20 Taxes 352.21 Indemnity 372.22 Illegality 372.23 Change of Lending Office 372.24 Replacement of Lenders under Certain Circumstances 382.25 Limitation on Additional Amounts, etc 38

SECTION 3. LETTERS OF CREDIT 393.1 L/C Commitment 393.2 Procedure for Issuance of Letter of Credit 393.3 Fees and Other Charges 393.4 L/C Participations 403.5 Reimbursement Obligation of the Borrower 413.6 Obligations Absolute 413.7 Letter of Credit Payments 413.8 Applications 42

SECTION 4. REPRESENTATIONS AND WARRANTIES 424.1 Financial Condition 424.2 No Change 434.3 Corporate Existence; Compliance with Law 434.4 Organizational Power; Authorization; Enforceable Obligations 43



4.5 No Legal Bar 43



4.6 No Material Litigation 444.7 No Default 444.8 Ownership of Property; Liens 444.9 Intellectual Property 444.10 Taxes 444.11 Federal Regulations 454.12 Labor Matters 454.13 ERISA 454.14 Investment Company Act; Other Regulations 454.15 Subsidiaries 454.16 Use of Proceeds 464.17 Environmental Matters 464.18 Accuracy of Information, etc 474.19 Security Documents 474.20 Solvency 484.21 Insurance 484.22 Transaction 484.23 Real Estate 494.24 Permits 494.25 Regulation H 49

SECTION 5. CONDITIONS PRECEDENT 495.1 Conditions to Initial Extension of Credit 495.2 Conditions to Each Extension of Credit 53

SECTION 6. AFFIRMATIVE COVENANTS 536.1 Financial Statements 536.2 Certificates; Other Information 546.3 Payment of Obligations 556.4 Conduct of Business and Maintenance of Existence, etc 556.5 Maintenance of Property; Insurance 566.6 Inspection of Property; Books and Records; Discussions 566.7 Notices 566.8 Environmental Laws 576.9 Additional Collateral, etc 586.10 Use of Proceeds 596.11 ERISA Documents 596.12 Further Assurances 606.13 Ratings 60

SECTION 7. NEGATIVE COVENANTS 607.1 Financial Condition Covenants 607.2 Limitation on Indebtedness 617.3 Limitation on Liens 657.4 Limitation on Fundamental Changes 667.5 Limitation on Disposition of Property 677.6 Limitation on Restricted Payments 687.7 Limitation on Capital Expenditures 697.8 Limitation on Investments 707.9 Limitation on Optional Payments and Modifications of Debt Instruments, etc 72



7.10 Limitation on Transactions with Affiliates 727.11 Limitation on Sales and Leasebacks 727.12 Limitation on Changes in Fiscal Periods 737.13 Limitation on Negative Pledge Clauses 737.14 Limitation on Restrictions on Subsidiary Distributions 737.15 Limitation on Lines of Business 747.16 Limitation on Amendments to Transaction Documents 747.17 Special Purpose Subsidiary 747.18 Limitation on Activities of Holdings 747.19 Limitation on Activities of Tronox Finance 747.20 Limitation on Hedge Agreements 757.21 Post-Closing Deliveries 75

SECTION 8. EVENTS OF DEFAULT 75

SECTION 9. THE AGENTS; THE ARRANGERS 789.1 Appointment 789.2 Delegation of Duties 789.3 Exculpatory Provisions 789.4 Reliance by Agents 789.5 Notice of Default 799.6 Non-Reliance on the Arrangers, the Agents and Other Lenders 799.7 Indemnification 809.8 Arrangers and Agent in their Individual Capacities 809.9 Successor Administrative Agent 809.10 Authorization to Release Liens and Guarantees 819.11 The Arrangers; the Syndication Agent and the Documentation Agents 819.12 Withholding Tax 81

SECTION10.

MISCELLANEOUS 81

10.1 Amendments and Waivers 8110.2 Notices 8310.3 No Waiver; Cumulative Remedies 8310.4 Survival of Representations and Warranties 8410.5 Payment of Expenses 8410.6 Successors and Assigns; Participations and Assignments 8510.7 Adjustments; Set-off 8810.8 Counterparts 8810.9 Severability 8810.10 Integration 8810.11 GOVERNING LAW 8810.12 Submission To Jurisdiction; Waivers 8910.13 Acknowledgments 8910.14 Confidentiality 8910.15 Release of Collateral and Guarantee Obligations 9010.16 Accounting Changes 9010.17 Delivery of Lender Addenda 9110.18 Construction 9110.19 WAIVERS OF JURY TRIAL 9110.20 Customer Identification�USA PATRIOT Act Notice 91



10.21 Transaction/Spin-Off 91



ANNEXES:

A Pricing Grid

B Existing Letters of Credit

SCHEDULES:

1.1(a) Electrolytic Assets1.1(b) Foreign Subsidiary Indebtedness1.1(c) Mortgaged Properties1.1(d) Henderson Real Estate4.4 Consents, Authorizations, Filings and Notices4.6(b) Material Litigation4.8(a) Real Property Title Exceptions4.10 Tax Filing Exceptions4.15 Subsidiaries4.19(a)-1 UCC Filing Jurisdictions4.19(a)-2 UCC Financing Statements to Remain on File4.19(a)-3 UCC Financing Statements to be Terminated4.19(b) Mortgage Filing Offices4.22 Transaction Documentation4.23 Owned and Leased Real Property4.24 Permits7.2(d) Existing Indebtedness7.3(f) Existing Liens7.7 Limitations on Capital Expenditures7.8(m) Investments7.21 Post-Closing Deliveries8(g)(i) Required Payments to Employee Welfare Benefits Plans8.(g)(ii) Required Payments to Multiemployer Plans

EXHIBITS:

A Form of Guarantee and Collateral AgreementB Form of Compliance CertificateC Form of Closing CertificateD Form of Assignment and AcceptanceE-1 Form of Legal Opinion of Covington & BurlingE-2 Form of Legal Opinion of Local or Foreign CounselE-3 Form of Legal Opinion of Borrower's General CounselF-1 Form of Term NoteF-2 Form of Revolving Credit NoteF-3 Form of Swing Line NoteG Form of Exemption CertificateH Form of Lender AddendumI Form of Borrowing NoticeJ Form of Solvency CertificateK Form of Mortgage



FORM OF CREDIT AGREEMENT, dated as of November , 2005, among TRONOX INCORPORATED, a Delaware corporation("Holdings"), TRONOX WORLDWIDE LLC, a Delaware limited liability company (the "Borrower"), the several banks and other financialinstitutions or entities from time to time parties to this Agreement (the "Lenders"), LEHMAN BROTHERS INC. and CREDIT SUISSE, asjoint lead arrangers and joint bookrunners (in such capacity, the "Arrangers"), ABN AMRO BANK N.V., as syndication agent (in suchcapacity, the "Syndication Agent"), JPMORGAN CHASE BANK, N.A. and CITICORP NORTH AMERICA, INC., as co-documentationagents (in such capacity, the "Documentation Agents"), and LEHMAN COMMERCIAL PAPER INC., as administrative agent (in suchcapacity, the "Administrative Agent").

W I T N E S S E T H:

WHEREAS, the Borrower has requested that the Lenders and the Issuing Lender make available for the purposes specified in thisAgreement, a term loan facility and a revolving line of credit; and

WHEREAS, the Lenders are willing to make such credit facilities available upon and subject to the terms and conditions hereinafter setforth;

NOW, THEREFORE, in consideration of the premises and the agreements hereinafter set forth, the parties hereto hereby agree asfollows:

SECTION 1. DEFINITIONS

1.1 Defined Terms. As used in this Agreement, the terms listed in this Section 1.1 shall have the respective meanings set forth in thisSection 1.1.

"Act": as defined in Section 10.20.

"Administrative Agent": as defined in the preamble hereto.

"Affiliate": as to any Person, any other Person that, directly or indirectly, is in control of, is controlled by, or is under common controlwith, such Person. For purposes of this definition, "control" of a Person means the power, directly or indirectly, either to (a) vote at least 10%of the securities having ordinary voting power for the election of directors (or for persons having similar functions) of such Person or(b) direct or cause the direction of the management and policies of such Person, whether by contract or otherwise.

"Affiliated Fund": with respect to any Lender that is a fund that invests (in whole or in part) in commercial loans, any other fund thatinvests (in whole or in part) in commercial loans and is managed by the same investment advisor as such Lender or by a Lender Affiliate ofsuch investment advisor.

"Agents": the collective reference to the Syndication Agent, the Arrangers, the Documentation Agents and the Administrative Agent.

"Aggregate Exposure": with respect to any Lender at any time, an amount equal to (a) until the Closing Date, the aggregate amount ofsuch Lender's Commitments at such time and (b) thereafter, the sum of (i) the aggregate then unpaid principal amount of such Lender's TermLoans and (ii) the amount of such Lender's Revolving Credit Commitment then in effect or, if the Revolving Credit Commitments have beenterminated, the amount of such Lender's Revolving Extensions of Credit then outstanding.

"Aggregate Exposure Percentage": with respect to any Lender at any time, the ratio (expressed as a percentage) of such Lender'sAggregate Exposure at such time to the sum of the Aggregate Exposures of all Lenders at such time.

"Agreement": this Credit Agreement, as amended, supplemented, replaced or otherwise modified from time to time in accordance withthis Agreement.

"Amended S-1": as defined in Section 5.1(c).



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"Applicable Currency" means (i) euro in the case of Revolving Credit Euro Loans or interest thereon or fees or other Obligations inrespect of Letters of Credit (Euro) or (ii) Dollars in the case of all other Loans or other Obligations.

"Applicable Margin": for each Type of Loan under each Facility, at any time, the rate per annum for such type of Loan determinedpursuant to the Pricing Grid on the basis of the Facility Ratings in effect at such time.

"Application": an application, in such form as the relevant Issuing Lender may specify from time to time, requesting such Issuing Lenderto issue a Letter of Credit.

"Arrangers": as defined in the preamble hereto.

"Asset Sale": any Disposition of Property or series of related Dispositions of Property (excluding any such Disposition permitted byclause (a)(i), (b), (c), (d), (f)(i), (f)(ii) (except to the extent the proviso thereto requires the application of Net Cash Proceeds thereof), (h), (i),(j), (k), (l), (m), (n) or (p) of Section 7.5).

"Assignee": as defined in Section 10.6(c).

"Assignment and Acceptance": as defined in Section 10.6(c).

"Assignor": as defined in Section 10.6(c).

"Available Revolving Credit Commitment": with respect to any Revolving Credit Lender at any time, an amount equal to the excess, ifany, of (a) such Lender's Revolving Credit Commitment then in effect over (b) such Lender's Revolving Extensions of Credit thenoutstanding; provided, that in calculating the Revolving Extensions of Credit of any Lender (other than the Swing Line Lender) for thepurpose of determining such Lender's Available Revolving Credit Commitment pursuant to Section 2.9(a), the aggregate principal amount ofSwing Line Loans then outstanding shall be deemed to be zero.

"Base Rate": for any day, a rate per annum (rounded upwards, if necessary, to the next 1/100 of 1%) equal to the greater of (a) the PrimeRate in effect on such day and (b) the Federal Funds Effective Rate in effect on such day plus 1/2 of 1%. For purposes hereof: "Prime Rate"shall mean the prime lending rate as set forth on the British Banking Association Telerate Page 5 (or such other comparable page as may, inthe opinion of the Administrative Agent, replace such page for the purpose of displaying such rate), as in effect from time to time. The PrimeRate is a reference rate and does not necessarily represent the lowest or best rate actually available. Any change in the Base Rate due to achange in the Prime Rate or the Federal Funds Effective Rate shall be effective as of the opening of business on the effective day of suchchange in the Prime Rate, or the Federal Funds Effective Rate, respectively.

"Base Rate Loans": Loans for which the applicable rate of interest is based upon the Base Rate.

"Benefitted Lender": as defined in Section 10.7.

"Board": the Board of Governors of the Federal Reserve System of the United States (or any successor).

"Borrower": as defined in the preamble hereto.

"Borrowing Date": any Business Day specified by the Borrower as a date on which the Borrower requests the relevant Lenders to makeLoans hereunder.

"Borrowing Notice": with respect to any request for borrowing of Loans hereunder, a notice from the Borrower, substantially in the formof, and containing the information prescribed by, Exhibit I, delivered to the Administrative Agent.



"Business Day": a day of the year that is: (a) a day other than a Saturday, Sunday or other day on which commercial banks in New YorkCity are authorized or required by law to close; and (b) with respect

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to any Revolving Euro Loan, in the case of (x) payments or purchases of euro, a TARGET Business Day and (y) all other purposes, includingthe giving and receiving of notices, a TARGET Business Day on which banks are generally open for business in London, England andFrankfurt, Germany; and (c) with respect to all notices (except with respect to general matters not relating directly to funding), determinationsand fundings in connection with, and payments of principal and interest on, LIBO Rate Loans, a day for trading by and between banks indeposits of the Applicable Currency for such Loans in the London interbank market. For purposes of this definition, a "TARGET BusinessDay" is a day when the Trans-European Automated Real-time Gross Settlement Express Transfer System, or any successor thereto, isscheduled to be open for business.

"Cancelled Foreign Debt": as defined in Section 7.5(k).

"Capital Expenditures": for any period, with respect to any Person, the aggregate of all expenditures by such Person and its Subsidiariesfor the acquisition or leasing (pursuant to a capital lease) of fixed or capital assets or additions to equipment (including replacements,capitalized repairs and improvements during such period) which are required to be capitalized under GAAP on a consolidated balance sheet ofsuch Person and its Subsidiaries provided that, for purposes of calculating compliance with Section 7.7, the following expenditures shall beexcluded, without duplication: (i) expenditures made to restore or replace Property to the condition of such Property immediately prior to anydamage, loss, or destruction or condemnation of such Property, to the extent such expenditure is made with, or subsequently reimbursed out ofthe proceeds received from any Recovery Event, (ii) expenditures made by the Borrower or any of its Subsidiaries constituting an Investmentpermitted by Sections 7.8(e), (g) or (h), (iii) expenditures made by the Borrower of any of its Subsidiaries as a tenant in leaseholdimprovements, to the extent reimbursed by the landlord and (iv) expenditures made with the proceeds of any Reinvestment Deferred Amountor proceeds of Dispositions of Property permitted by clauses (a)(ii), (e), (f)(ii), (g), (j), (o) or (q) of Section 7.5.

"Capital Lease Obligations": with respect to any Person, the obligations of such Person to pay rent or other amounts under any lease of(or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to beclassified and accounted for as capital leases on a balance sheet of such Person under GAAP; and, for the purposes of this Agreement, theamount of such obligations at any time shall be the capitalized amount thereof at such time determined in accordance with GAAP.

"Capital Stock": any and all shares, interests, participations or other equivalents (however designated) of capital stock of a corporation,any and all equivalent ownership interests in a Person (other than a corporation) and any and all warrants, rights or options to purchase any ofthe foregoing.

"Cash Equivalents": (a) marketable direct obligations issued by, or unconditionally guaranteed by, the United States government orissued by any agency thereof and backed by the full faith and credit of the United States, in each case maturing within one year from the dateof acquisition; (b) certificates of deposit, time deposits, eurodollar time deposits or overnight bank deposits having maturities of one year orless from the date of acquisition issued by any Lender or by any commercial bank organized under the laws of the United States of America orany state thereof having combined capital and surplus of not less than $500,000,000; (c) commercial paper of an issuer rated at least A-1 byS&P or P-1 by Moody's, or carrying an equivalent rating by a nationally recognized rating agency, if both of the two named rating agenciescease publishing ratings of commercial paper issuers generally, and maturing within nine months from the date of acquisition; (d) repurchaseobligations of any Lender or of any commercial bank satisfying the requirements of clause (b) of this definition, having a term of not morethan one year with respect to securities of the type set forth in clause (a) of this definition; (e) securities with maturities of one year or lessfrom the date of acquisition issued or fully guaranteed by any state, commonwealth or territory of the United States, by any politicalsubdivision or taxing authority of any such state, commonwealth or territory or by any foreign government, the securities of which state,commonwealth, territory, political subdivision,

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taxing authority or foreign government (as the case may be) are rated at least A by S&P or A by Moody's; (f) securities with maturities of oneyear or less from the date of acquisition backed by standby letters of credit issued by any Lender or any commercial bank satisfying therequirements of clause (b) of this definition; (g) shares of money market mutual or similar funds which invest exclusively in assets satisfyingthe requirements of clauses (a) through (f) of this definition; (h) shares of money market funds that (i) comply with the criteria set forth inSEC Rule 2a-7 under the Investment Company Act of 1940, as amended, (ii) are rated AA by S&P or Aa by Moody's and (iii) have portfolioassets of at least $1,000,000; or (i) for purposes of Sections 7.5 and 7.8, in the case of any Foreign Subsidiary, Investments of the type andmaturity described in clauses (a) through (h) above in obligors organized under the laws of the jurisdiction in which such Foreign Subsidiaryor another Foreign Subsidiary is organized or under the laws of the United Kingdom or the People's Republic of China.

"Change of Control": the occurrence of any of the following events: (a) any "person" or "group" (as such terms are used in Sections 13(d)and 14(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act")), excluding KMG and its Subsidiaries, shall become the"beneficial owner" (as defined in Rules 13(d)-3 and 13(d)-5 under the Exchange Act), directly or indirectly, of more than 35% of theoutstanding common stock of Holdings; (b) the board of directors of Holdings shall cease to consist of a majority of Continuing Directors;(c) Holdings shall cease to own and control, of record and beneficially, directly, 100% of each class of outstanding Capital Stock of theBorrower free and clear of all Liens (except Liens created by the Guarantee and Collateral Agreement and Permitted Liens); or (d) a SpecifiedChange of Control.

"Closing Date": the date on which the conditions precedent set forth in Section 5.1 shall have been satisfied or waived, which date shallbe not later than December 21, 2005.

"Code": the Internal Revenue Code of 1986, as amended from time to time.

"Collateral": (i) all Personal Property Collateral and (ii) the Mortgaged Properties.

"Commitment": with respect to any Lender, the sum of the Tranche A Term Loan Commitment and the Revolving Credit Commitment ofsuch Lender.

"Commitment Fee Rate": at any time, the rate per annum determined pursuant to the Pricing Grid on the basis of the Facility Ratings ineffect at such time.

"Commonly Controlled Entity": an entity, whether or not incorporated, that is under common control with the Borrower within themeaning of Section 4001 of ERISA or is part of a group that includes the Borrower and that is treated as a single employer under Section 414of the Code.

"Compliance Certificate": a certificate duly executed by a Responsible Officer, substantially in the form of Exhibit B.

"Confidential Information Memorandum": the Confidential Information Memorandum dated November 2005 and furnished to the initialLenders in connection with the syndication of the Facilities.

"Consolidated EBITDA": of any Person for any period, Consolidated Net Income of such Person and its Subsidiaries for such periodplus, without duplication and to the extent reflected as a charge in the statement of such Consolidated Net Income for such period, the sum of(a) income tax expense, (b) Consolidated Interest Expense of such Person and its Subsidiaries; amortization or write-off of debt discount anddebt issuance costs; commissions, discounts and other fees and charges associated with Indebtedness; (c) depreciation and amortizationexpense, (d) amortization of intangibles (including goodwill) and organization costs, (e) any extraordinary, unusual or non-recurring expensesor losses (including, whether or not otherwise includable as a separate item in the statement of such Consolidated Net Income for such period,losses on sales of assets outside of the ordinary course of business), (f) provision for environmental restoration and remediation (net ofreimbursements) for continuing operations to the extent representing an accrual of or reserve for future cash expenses, (g) non-cash

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charges constituting (i) write-downs of property, plant and equipment and other assets, (ii) impairment of intangible assets, (iii) loss resultingfrom cumulative effect of change in accounting principle, (iv) compensation charges, including those arising from stock options, restrictedstock grants or other equity-incentive programs, (v) loss on sale of accounts receivable under asset securitization or factoring programs (to theextent comparable to interest expense), (vi) loss from discontinued operations, (vii) provisions for asset retirement obligations, (viii) pensionand post-retirement costs and (ix) accretion expenses, (h) shutdown costs associated with the Savannah Sulfate Facility closure incurred in2004 in an aggregate amount not to exceed $29,000,000; (i) all one-time fees, costs and expenses (including cash compensation payments)incurred in connection with or resulting from Parent's separation from KMG, the IPO and the transactions related thereto and the Distributionand (j) cash expenditures from discontinued operations in an aggregate amount for such period not to exceed $17,000,000, and minus, withoutduplication and to the extent included in the statement of such Consolidated Net Income for such period, the sum of (a) interest income(except to the extent deducted in determining Consolidated Interest Expense), (b) any extraordinary, unusual or non-recurring income or gains(including, whether or not otherwise includable as a separate item in the statement of such Consolidated Net Income for such period, gains onthe sales of assets outside of the ordinary course of business), (c) any other non-cash income (including income arising from cumulative effectof change in accounting principle and income tax benefit), and (d) income from discontinued operations, all as determined on a consolidatedbasis.

"Consolidated Interest Coverage Ratio": for any period, the ratio of (x) Consolidated EBITDA of Holdings and its Subsidiaries for suchperiod less (without duplication) the sum of (a) cash expenditures (net of cash reimbursements not included in the calculation of ConsolidatedNet Income of Holdings for that period), including cash expenditures charged to previously recorded reserves, for (i) environmentalrestoration and remediation, (ii) discontinued operations and (iii) asset retirement obligations, in each case, to the extent such cashexpenditures were not deducted in the calculation of Consolidated Net Income of Holdings for that period, and (b) any amounts added back inthe calculation of Consolidated EBITDA of Holdings for that period pursuant to clause (j) of the definition thereof, to (y) ConsolidatedInterest Expense of Holdings and its Subsidiaries for such period; provided, that for purposes for calculating Consolidated EBITDA (and cashexpenditures and amounts specified in clauses (a) and (b)) of Holdings and its Subsidiaries for any period, (i) the Consolidated EBITDA (andcash expenditures and amounts specified in clauses (a) and (b) above) of any Person acquired by Holdings or its Subsidiaries during suchperiod shall be included on a pro forma basis for such period (assuming for purposes of the calculation of Consolidated EBITDA (and cashexpenditures and amounts specified in clauses (a) and (b) above) the consummation of such acquisition and the incurrence or assumption ofany Indebtedness in connection therewith occurred on the first day of such period) and (ii) the Consolidated EBITDA (and cash expendituresand amounts specified in clauses (a) and (b) above) of any Person Disposed of by Holdings or its Subsidiaries during such period shall beexcluded from such period (assuming for purposes of the calculation of Consolidated EBITDA (and cash expenditures and amounts specifiedin clauses (a) and (b) above) the consummation of such Disposition and the repayment of any Indebtedness in connection therewith occurredon the first day of such period).

"Consolidated Interest Expense": of any Person for any period, total cash interest expense (including that attributable to Capital LeaseObligations) of such Person and its Subsidiaries for such period with respect to all outstanding Indebtedness of such Person and itsSubsidiaries (including all commissions, discounts and other fees and charges owed by such Person with respect to letters of credit andbankers' acceptance financing), calculated in accordance with GAAP. Consolidated Interest Expense for any period will be adjusted to(A) exclude the Consolidated Interest Expense attributable to any Indebtedness repaid or assumed by a third party (and which became non-recourse to such Person and its Subsidiaries) in connection with the Disposition of any asset or business that was disposed of (either directly oras part of an exchange) by such Person or any of its Subsidiaries during such period (as if such Indebtedness had not been outstanding on thefirst day of such period) and (B) include the Consolidated Interest Expense attributable to any Indebtedness incurred or assumed in connectionwith the acquisition of any asset or

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business that was acquired (either directly or as part of an exchange) by such Person or any of its Subsidiaries during such period (as if suchIndebtedness had been outstanding on the first day of such period).

"Consolidated Net Income": of any Person for any period, the consolidated net income (or loss) of such Person and its Subsidiaries forsuch period, determined on a consolidated basis in accordance with GAAP; provided, that in calculating Consolidated Net Income of suchPerson for any period, there shall be excluded (a) the income (or deficit) of any Person accrued prior to the date it becomes a Subsidiary ofsuch Person or is merged into or consolidated with such Person or any of its Subsidiaries, (b) the income (or deficit) of any Person (other thana Subsidiary of such Person) in which such Person or any of its Subsidiaries has an ownership interest, except to the extent that any suchincome is actually received by such Person or such Subsidiary in the form of dividends or similar distributions and (c) the undistributedearnings of any Subsidiary of such Person to the extent that the declaration or payment of dividends or similar distributions by such Subsidiaryis not at the time permitted by the terms of any Contractual Obligation (other than under any Loan Document) or Requirement of Lawapplicable to such Subsidiary.

"Consolidated Tangible Assets" means total assets (less accumulated depreciation and valuation reserves and other reserves and itemsdeductible from gross book value of specific asset accounts under GAAP) after deducting therefrom all goodwill, trade names, trademarks,patents, unamortized debt discount, organization expenses and other like intangibles, all as set forth on the most recent balance sheet ofHoldings delivered to the Administrative Agent, on a consolidated basis, determined in accordance with GAAP.

"Consolidated Total Debt": at any date, the aggregate principal amount of all Funded Debt of Holdings and its Subsidiaries at such date,determined on a consolidated basis in accordance with GAAP.

"Consolidated Total Leverage Ratio": as at the last day of any period of four consecutive fiscal quarters of Holdings, the ratio of(a) Consolidated Total Debt on such day to (b) Consolidated EBITDA of the Holdings and its Subsidiaries for such period; provided that forpurposes of calculating Consolidated EBITDA of the Holdings and its Subsidiaries for any period, (i) the Consolidated EBITDA of anyPerson acquired by the Holdings or its Subsidiaries during such period shall be included on a pro forma basis for such period (assuming forpurposes of the calculation of Consolidated EBITDA the consummation of such acquisition and the incurrence or assumption of anyIndebtedness in connection therewith occurred on the first day of such period) and (ii) the Consolidated EBITDA of any Person Disposed ofHoldings or its Subsidiaries during such period shall be excluded for such period (assuming for purposes of the calculation of ConsolidatedEBITDA the consummation of such Disposition and the repayment of any Indebtedness in connection therewith occurred on the first day ofsuch period).

"Continuing Directors": the directors of Holdings on the Closing Date, after giving effect to the Transactions and the other transactionscontemplated hereby, and each other director of Holdings, if, in each case, such other director's nomination for election to the board ofdirectors of Holdings is recommended by at least a majority of the then Continuing Directors.

"Contractual Obligation": with respect to any Person, any provision of any security issued by such Person or of any agreement,instrument or other undertaking to which such Person is a party or by which it or any of its Property is bound.

"Contributed Business": the business (including assets and liabilities) of Holdings and the Contributed Subsidiaries on the Closing Dateafter giving effect to the Contribution.

"Contributed Subsidiaries": the entities that constitute the consolidated Subsidiaries of Holdings on the Closing Date as specified onSchedule 4.15(a) hereto

"Contribution": the contribution and transfer by KMG and its Subsidiaries to (i) Holdings of 100% of the Capital Stock of Borrower and(ii) the Borrower of 100% of the Capital Stock of the Contributed

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Subsidiaries (other than the Borrower) owned on or prior to the Closing Date by KMG and its Subsidiaries, together with the othercontributions and transfers effected pursuant to the Transaction Agreements (x) necessary to cause the Borrower to own on the Closing Datethe chemical business operated as part of KMG and its subsidiaries prior to the Closing Date or (y) effected between KMG and Holdings orthe Borrower or subsidiaries thereof on or prior to the Closing Date in connection therewith.

"Default": any of the events specified in Section 8, whether or not any requirement for the giving of notice, the lapse of time, or both, hasbeen satisfied.

"Defaulting Lender": as defined in Section 2.24.

"Derivatives Counterparty": as defined in Section 7.6.

"Disposition": with respect to any Property, any sale, sale and leaseback, assignment, conveyance, transfer or other disposition thereof(including by way of a merger or consolidation) of such Property or any interest therein (including the sale or factoring at maturity orcollection of any accounts or permitting or suffering any other Person to acquire any interest (other than a Lien permitted under Section 7.3) insuch Property; and the terms "Dispose" and "Disposed of" shall have correlative meanings.

"Disqualified Stock": any Capital Stock that, by its terms (or by the terms of any security into which it is convertible or for which it isexchangeable), or upon the happening of any event (other than a change in control), matures or is mandatorily redeemable, pursuant to asinking fund obligation or otherwise, or redeemable at the option of the holder thereof, in whole or in part, on or prior to the date that is sixmonths after the Tranche A Term Loan Maturity Date, except to the extent that such Capital Stock is redeemable with, or solely exchangeablefor, any Capital Stock of such Person that is not Disqualified Stock.

"Distribution": the distribution by Holdings of the net proceeds of the borrowings under the Tranche A Term Loan and the Senior Notesand the net proceeds of the IPO to Kerr-McGee Worldwide, all net of any fees, costs or expenses relating to the Contribution, the IPO, theoffering of the Notes and the creation of and initial borrowing under the Credit Facilities and transactions related thereto (it being understoodand agreed that such fees, costs and expenses may be estimated by Holdings in good faith).

"Documentation Agent": as defined in the preamble hereto.

"Dollar Equivalent": at the time of determination thereof, (a) in relation to any amount denominated in euro, the equivalent of suchamount in Dollars determined by using the Dollar Equivalent Exchange Rate on the most recent Valuation Date; or (b) in relation to anyamount denominated in Dollars, the amount thereof.

"Dollar Equivalent Exchange Rate": on any Valuation Date, the rate of exchange indicated for the purchase of Dollars with euro on theBloomberg Key Cross Currency Rates screen at 11:00 a.m. (New York City time) on such Valuation Date.

"Dollar Loan": a Loan denominated in Dollars.

"Dollars" and "$": lawful currency of the United States of America.

"Domestic Subsidiary": any Subsidiary of the Borrower that is organized under the laws of any jurisdiction within the United States ofAmerica.

"ECF Percentage": with respect to any fiscal year of the Borrower, 75%; provided, that, with respect to any fiscal year of the Borrowerending on or after December 31, 2006, the ECF Percentage shall instead be (i) 50% if the Consolidated Interest Coverage Ratio for the periodof four consecutive fiscal quarters ending on the last day of such fiscal year is greater than 4.0 to 1.0, (ii) 25% if the Consolidated InterestCoverage Ratio for the period of four consecutive fiscal quarters ending on the last day of such fiscal year

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is greater than 6.0 to 1.0 or (iii) 0% if the Consolidated Interest Coverage Ratio for the period of the four consecutive fiscal quarters ending onthe last day of such fiscal year is greater than 8.0 to 1.0.

"Electrolytic Assets": those assets used in electrolytic business of the Borrower and its Subsidiaries described in Schedule 1.1(a) hereto.

"Eligible Assignee": as defined in Section 10.6(c).

"Environmental Laws": any and all laws, rules, orders, regulations, statutes, ordinances, guidelines, codes, decrees, or other legallyenforceable requirements (including common law) of any foreign government, the United States, or any Governmental Authority, regulating,relating to or imposing liability or standards of conduct concerning protection of the environment or of human health, employee health andsafety, or Materials of Environmental Concern, as has been, is now, or may at any time hereafter be, in effect.

"Environmental Permits": any and all permits, licenses, approvals, registrations, notifications, exemptions and other authorizationsrequired under any Environmental Law.

"ERISA": the Employee Retirement Income Security Act of 1974, as amended from time to time.

"euro" and the sign "€": each, the lawful money of the participating member states of the European Union.

"Eurocurrency Liabilities" has the meaning assigned to that term in Regulation D.

"Event of Default": any of the events specified in Section 8, provided that any requirement for the giving of notice, the lapse of time, orboth, has been satisfied.

"Excess Cash Flow": for any fiscal year of Holdings, the excess, if any, of (a) the amount of "net cash provided by operating activities",determined on a consolidated basis in accordance with GAAP and as such amount is set forth opposite such caption in the consolidatedstatement of cash flows of Holdings and its Subsidiaries for such fiscal year (the "Cash Flow Statement") plus (b) cash collected onrepurchased receivables, as set forth opposite such caption on the Cash Flow Statement, minus (c) the sum, without duplication, of (i) exceptto the extent directly or indirectly financed by incurring Indebtedness (including the incurrence of Capital Lease Obligations) or by any capitalcontribution to, or the issuance of any Capital Stock of, Holdings, or to the extent constituting a reinvestment of Net Cash Proceeds of aReinvestment Event, (A) the aggregate amount paid in cash by the Borrower and its Subsidiaries during such fiscal year on account of capitalexpenditures, as set forth opposite such caption on the Cash Flow Statement, (B) the aggregate amount paid in cash (net of cash acquired) bythe Borrower and its Subsidiaries during such fiscal year on account of acquisitions, as set forth opposite the caption "acquisitions, net of cashacquired" on the Cash Flow Statement, (C) the aggregate amount paid in cash by the Borrower and its Subsidiaries during such fiscal year onaccount of purchases of long-term investments, as set forth opposite such caption on the Cash Flow Statement, and (D) the aggregate amountof cash dividends paid during such fiscal year by Holdings, as set forth opposite the caption "dividends paid" on the Cash Flow Statement tothe extent permitted under clause (d) of Section 7.6, (ii) the aggregate amount of all mandatory prepayments of Tranche A Term Loans duringsuch fiscal year made pursuant to Section 2.12(b), (f) or (g) with the Net Cash Proceeds of Asset Sales, Receivable Qualifying Asset Sales orRecovery Events to the extent such Net Cash Proceeds are included in "net cash provided by operating activities" for such fiscal year, (iii) theaggregate amount of all prepayments of Revolving Loans and Swingline Loans and all payments of Reimbursement Obligations during suchfiscal year to the extent accompanying permanent optional reductions of the Revolving Commitments and all optional prepayments of theTranche A Term Loans during such fiscal year, other than, in each case, prepayments made in connection with a refinancing of suchIndebtedness and (iv) the aggregate amount of all regularly scheduled principal payments of Funded Debt (including the Term Loans) of theBorrower and its Subsidiaries made during such fiscal year (other than in respect of any revolving credit facility to the extent

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there is not an equivalent permanent reduction in commitments thereunder); provided, however, that, "Excess Cash Flow" shall not includeany proceeds from the Incurrence of Indebtedness by Holdings or any Subsidiary thereof or the issuance by Holdings of, or capitalcontributions on, its Capital Stock, in each case pursuant to the terms hereof.

"Excess Cash Flow Application Date": as defined in Section 2.12(c).

"Existing Issuing Lender": collectively, JP Morgan Chase Bank, N.A., [Citigroup] and ABN Amro Bank N.V., the issuing banks inrespect of the Existing Letters of Credit.

"Existing Letters of Credit": the letter of credits issued under the KMG Existing Credit Agreement or under [ABN AMRO Agreement]by the Existing Issuing Lender for the benefit of the Borrower or a Subsidiary of the Borrower in the respective outstanding face amounts onthe Closing Date specified on Annex B.

"Facility": each of (a) the Tranche A Term Loan Commitments and the Tranche A Term Loans made thereunder (the "Tranche A TermLoan Facility"), and (b) the Revolving Credit Commitments and the extensions of credit made thereunder (the "Revolving Credit Facility").

"Facility Rating": a rating of the Credit Facilities by a Rating Agency.

"Federal Funds Effective Rate": for any day, the weighted average of the rates on overnight federal funds transactions with members ofthe Federal Reserve System arranged by federal funds brokers, as published on the next succeeding Business Day by the Federal ReserveBank of New York, or, if such rate is not so published for any day which is a Business Day, the average of the quotations for the day of suchtransactions received by the Administrative Agent from three federal funds brokers of recognized standing selected by it.

"Fee Letter": that certain Fee Letter, dated October 26, 2005, among KMG, Holdings, the Borrower, Lehman Brothers Inc. and theArrangers.

"Foreign Subsidiary": any Subsidiary of the Borrower that is not a Domestic Subsidiary.

"Foreign Subsidiary Debt Amount": the sum of (i) the aggregate principal amount of the Indebtedness of Foreign Subsidiaries (andKMEMC) owing to the Borrower and the Subsidiary Guarantors outstanding on the Closing Date as specified on Schedule 1.1(b) hereto and(ii) $75,000,000.

"FQ1", "FQ2", "FQ3", and "FQ4": when used with a numerical year designation, means the first, second, third or fourth fiscal quarters,respectively, of such fiscal year of the Borrower. (e.g., FQ1 2005 means the first fiscal quarter of the Borrower's 2005 fiscal year, which endsMarch 31, 2005).

"Funded Debt": with respect to any Person, all Indebtedness of such Person of the types described in clauses (a), (b), (c), (d), (e), (g) and(h) of the definition of "Indebtedness" in this Section, provided that Indebtedness referred to in clause (h) shall constitute Funded Debt only tothe extent that it relates to Indebtedness in respect of clauses (a), (c) or (e) of the definition of "Indebtedness" in this Section.

"Funding Office": the office specified from time to time by the Administrative Agent as its funding office by notice to the Borrower andthe Lenders.

"GAAP": generally accepted accounting principles in the United States of America as in effect from time to time, but subject toSection 10.16 of this Agreement.

"Governing Documents": collectively, as to any Person, the articles or certificate of incorporation and bylaws, any shareholdersagreement, certificate of formation, limited liability company agreement, partnership agreement or other formation or constituent documentsof such Person.



9



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

"Guarantee and Collateral Agreement": the Guarantee and Collateral Agreement to be executed and delivered by Holdings, the Borrowerand each Subsidiary Guarantor, substantially in the form of Exhibit A, as the same may be amended, supplemented, replaced or otherwisemodified from time to time.

"Guarantee Obligation": with respect to any Person (the "guaranteeing person"), any obligation of (a) the guaranteeing person or(b) another Person (including any bank under any letter of credit), if to induce the creation of which the guaranteeing person has issued areimbursement, counterindemnity or similar obligation, in either case guaranteeing or in effect guaranteeing any Indebtedness (the "primaryobligations") of any other third Person (the "primary obligor") in any manner, whether directly or indirectly, including any obligation of theguaranteeing person, whether or not contingent, (i) to purchase any such primary obligation or any Property constituting direct or indirectsecurity therefor, (ii) to advance or supply funds (1) for the purchase or payment of any such primary obligation or (2) to maintain workingcapital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor, (iii) to purchaseProperty, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primaryobligor to make payment of such primary obligation or (iv) otherwise to assure or hold harmless the owner of any such primary obligationagainst loss in respect thereof; provided, however, that the term Guarantee Obligation shall not include endorsements of instruments fordeposit or collection in the ordinary course of business. The amount of any Guarantee Obligation of any guaranteeing person shall be deemedto be the lower of (a) an amount equal to the stated or determinable amount of the primary obligation in respect of which such GuaranteeObligation is made and (b) the maximum amount for which such guaranteeing person may be liable pursuant to the terms of the instrumentembodying such Guarantee Obligation, unless such primary obligation and the maximum amount for which such guaranteeing person may beliable are not stated or determinable, in which case the amount of such Guarantee Obligation shall be such guaranteeing person's maximumreasonably anticipated liability in respect thereof as determined by the Borrower in good faith.

"Guarantors": the collective reference to Holdings and the Subsidiary Guarantors.

"Hedge Agreements": all interest rate or currency swaps, caps or collar agreements, foreign exchange agreements, commodity contractsor similar arrangements entered into by Holdings, the Borrower or its Subsidiaries providing for protection against fluctuations in interestrates, currency exchange rates, commodity prices or the exchange of nominal interest obligations, either generally or under specificcontingencies.

"Henderson Real Estate": the real estate described on Schedule 1.1(d).

"Henderson Sale Proceeds": all cash and Cash Equivalents (including any such cash or Cash Equivalents received by way of distributionsin respect of deferred payment of principal pursuant to a note or installment receivable or purchase price adjustment receivable or otherwise,but only as and when received) received by the Borrower from The Landwell Company, LP and/or Basic Management, Inc. in connectionwith the sale of the Henderson Real Estate by The Landwell Company, LP and the distribution of the net proceeds of such sale by TheLandwell Company, LP and/or Basic Management, Inc. to its equity holders, net of (i) taxes paid and/or reasonably estimated to be payable asa result thereof (after taking into account any available tax credits or deductions and any tax sharing arrangements) and (ii) all other amountsof the type described in clauses (a)(i) and (a)(ii) of the definition of "Net Cash Proceeds" to the extent applicable to Holdings, the Borrower orany of its Subsidiaries in connection with such sale.

"Immaterial Subsidiary": as of any date, any Subsidiary whose total assets, as of the last day of the most recently ended four full fiscalquarter period for which internal financial statements are available immediately preceding such date, are less than $50,000 and whose totalrevenues for the most recently

10



ended four full fiscal quarters for which internal financial statements are available immediately preceding such date do not exceed $50,000;provided that a Subsidiary will not be considered to be an Immaterial Subsidiary if it (i) directly or indirectly, guarantees or otherwiseprovides direct credit support for any Indebtedness of any of Holdings, the Borrower or any Subsidiary Guarantor or (ii) owns any StockCollateral.

"Indebtedness": of any Person at any date, without duplication, (a) all indebtedness of such Person for borrowed money, (b) allobligations of such Person for the deferred purchase price of Property or services (other than current trade payables and accrued expensesincurred in the ordinary course of such Person's business), (c) all obligations of such Person evidenced by notes, bonds, debentures or othersimilar instruments, (d) all indebtedness created or arising under any conditional sale or other title retention agreement with respect toProperty acquired by such Person (even though the rights and remedies of the seller or lender under such agreement in the event of default arelimited to repossession or sale of such Property), provided that the amount of such Indebtedness of any Person described in this clause (d)shall, for the purposes of this Agreement, be deemed to be equal to the lesser of (i) the aggregate unpaid amount of such Indebtedness and(ii) the fair market value of the property or asset encumbered, as determined by such Person in good faith, (e) all Capital Lease Obligations ofsuch Person, (f) all obligations of such Person, contingent or otherwise, as an account party or applicant under acceptance, letter of credit orsimilar facilities, (g) all obligations of such Person, contingent or otherwise, to purchase, redeem, retire or otherwise acquire for value anyDisqualified Stock of such Person, provided that the amount of such Indebtedness of any Person described in this clause (g) shall, for thepurposes of this Agreement, be deemed to be equal to the liquidation value of such Disqualified Stock, (h) all Guarantee Obligations of suchPerson in respect of obligations of the kind referred to in clauses (a) through (g) above, (i) to the extent not otherwise included pursuant toclause (a) through (h) above, all obligations of the kind referred to in clauses (a) through (h) above secured by (or for which the holder of suchobligation has an existing right, contingent or otherwise, to be secured by) any Lien on Property (including accounts and contract rights)owned by such Person, whether or not such Person has assumed or become liable for the payment of such obligation, provided that the amountof such Indebtedness of any Person described in this clause (i) shall, for the purposes of this Agreement, be deemed to be equal to the lesser of(i) the aggregate unpaid amount of such Indebtedness and (ii) the fair market value of the property or asset encumbered, as determined by suchPerson in good faith, and (j) for the purposes of Section 8(e) only, all obligations of such Person in respect of Hedge Agreements (it beingunderstood that obligations of such Person in respect of Hedge Agreements shall otherwise not be considered Indebtedness for purposes ofthis Agreement); provided that Indebtedness shall not include any earn-out obligations. The amount of any Indebtedness under clause (j) shallbe the net amount, including any net termination payments, that would be required to be paid to a counterparty on such date if a termination ofthe applicable Hedge Agreement were to occur on such date, rather than the notional amount of the applicable Hedge Agreement. TheIndebtedness of any Person shall include, without duplication, the Indebtedness of any other entity (including any partnership in which suchPerson is a general partner) to the extent such Person is liable therefor as a result of such Person's ownership interest in or other relationshipwith such entity, except to the extent the terms of such Indebtedness expressly provide that such Person is not liable therefor.

"Indemnified Liabilities": as defined in Section 10.5.

"Indemnitee": as defined in Section 10.5.

"Insolvency": with respect to any Multiemployer Plan, the condition that such Plan is insolvent within the meaning of Section 4245 ofERISA.

"Insolvent": pertaining to a condition of Insolvency.

"Intellectual Property": the collective reference to all rights, priorities and privileges relating to intellectual property, whether arisingunder United States, state, multinational or foreign laws or otherwise, including copyrights, copyright licenses, patents, patent licenses,trademarks, trademark licenses, service-marks, technology, know-how and processes, recipes, formulas, and all rights to sue at law or inequity for any infringement or other impairment thereof, including the right to receive all proceeds and damages therefrom.

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"Interest Payment Date": (a) as to any Base Rate Loan, the last day of each March, June, September and December to occur while suchLoan is outstanding and the final maturity date of such Loan, (b) as to any LIBO Rate Loan having an Interest Period of three months or less,the last day of such Interest Period, (c) as to any LIBO Rate Loan having an Interest Period longer than three months, each day that is threemonths, or a whole multiple thereof, after the first day of such Interest Period and the last day of such Interest Period and (d) as to any Loan(other than any Revolving Credit Loan that is a Base Rate Loan (unless all Revolving Credit Loans are being repaid in full in immediatelyavailable funds and the Revolving Credit Commitments terminated) and any Swing Line Loan), the date of any repayment or prepaymentmade in respect thereof.

"Interest Period": as to any LIBO Rate Loan, (a) initially, the period commencing on the borrowing or conversion date, as the case maybe, with respect to such LIBO Rate Loan and ending one, two, three, six or (if available to all Lenders under the relevant Facility, asdetermined by such Lenders in their sole discretion) one, two or three weeks or nine or twelve months thereafter, as selected by the Borrowerin its Borrowing Notice or notice of conversion, as the case may be, given with respect thereto; and (b) thereafter, each period commencing onthe last day of the next preceding Interest Period applicable to such LIBO Rate Loan and ending one, two, three, six or (if available to allLenders under the relevant Facility, as determined by such Lenders in their sole discretion) one, two or three weeks or nine or twelve monthsthereafter, as selected by the Borrower by irrevocable notice to the Administrative Agent not later than 12:00 noon, New York City time, onthe third Business Day prior to the last day of the then current Interest Period with respect thereto; provided that, all of the foregoingprovisions relating to Interest Periods are subject to the following:

(a) if any Interest Period would otherwise end on a day that is not a Business Day, such Interest Period shall be extended tothe next succeeding Business Day unless the result of such extension would be to carry such Interest Period into another calendarmonth in which event such Interest Period shall end on the immediately preceding Business Day;

(b) any Interest Period that would otherwise extend beyond the Scheduled Revolving Credit Termination Date (with respect tothe Revolving Credit Facility) or beyond the date final payment is due on the Tranche A Term Loans (with respect to the Tranche ATerm Loan Facility) shall end on the Scheduled Revolving Credit Termination Date or such due date, as applicable; and

(c) any Interest Period that begins on the last Business Day of a calendar month (or on a day for which there is no numericallycorresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day of the calendar monthat the end of such Interest Period.

"Investments": as defined in Section 7.8.

"IPO": the initial public offering of class A common stock of Holdings.

"Issuing Lender": the collective reference to each Revolving Credit Lender (or any Lender Affiliate that becomes a party hereto) fromtime to time designated by the Borrower with the consent of such Revolving Credit Lender and the Administrative Agent (which consent shallnot unreasonably be withheld or delayed), in its capacity as issuer of any Letter of Credit. The Issuing Lenders, on the date hereof, are,collectively, ABN Amro Bank N.V., JPMorgan Chase Bank, N.A. and Citicorp North America, Inc..

"KMEMC" means Kerr-McGee Environmental Management Corporation, a Delaware corporation.

"KMG": Kerr-McGee Corporation, a Delaware corporation.

"KMG Existing Credit Agreement": dated as of May 18, 2005, among KMG, as borrower, the several lenders party thereto, JP MorganChase Bank, N.A., as administrative agent, and the other agents named herein.

"Kerr-McGee Worldwide": Kerr-McGee Worldwide Corporation, a Delaware corporation.

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"KMG Specified Debt Instruments": the KMG Existing Credit Agreement and the Existing Indentures (as defined in the KMG ExistingCredit Agreement).

"KMG Party": (i) KMG; (ii) Kerr-McGee Worldwide; and (iii) each Subsidiary of KMG (other than Holdings, the Borrower or itsSubsidiaries).

"L/C Fee Payment Date": the last day of each March, June, September and December and the last day of the Revolving CreditCommitment Period.

"L/C (Euro) Obligations": at any time, an amount equal to the sum of, without duplication, (a) the aggregate then undrawn and unexpiredamount of the then outstanding Letters of Credit (Euro) and (b) the aggregate amount of drawings under Letters of Credit (Euro) that have notthen been reimbursed pursuant to Section 3.5.

"L/C Obligations": at any time, an amount equal to the sum of, without duplication, (a) the aggregate then undrawn and unexpiredamount of the then outstanding Letters of Credit and (b) the aggregate amount of drawings under Letters of Credit that have not then beenreimbursed pursuant to Section 3.5.

"L/C Participants": with respect to any Letter of Credit, the collective reference to all the Revolving Credit Lenders other than the IssuingLender that issued such letter of Credit.

"Lender Addendum": with respect to any initial Lender, a Lender Addendum, substantially in the form of Exhibit H, to be executed anddelivered by such Lender on the Closing Date as provided in Section 10.17.

"Lender Affiliate": as to any Lender, any other Person that, directly or indirectly, is in control of, is controlled by, or is under commoncontrol with, such Lender. For purposes of this definition, "control" of a Person means the power, directly or indirectly, either to (a) vote atleast a majority of the securities having ordinary voting power for the election of directors (or for persons having similar functions) of suchPerson or (b) direct or cause the direction of the management and policies of such Person, whether by contract or otherwise.

"Lenders": as defined in the preamble hereto.

"Letter Agreement": the Letter Agreement, dated as of February 23, 2005, among the KMG and Lehman Brothers.

"Letters of Credit": as defined in Section 3.1(a).

"Letter of Credit (Euro)": any Letters of Credit drawings under which are payable in euro.

"LIBOR": with respect to any Interest Period for any LIBO Rate Loan in an Applicable Currency comprising part of the same Borrowing,the rate of interest per annum determined by the Administrative Agent at approximately 11:00 a.m. (London time) on the date that is twoBusiness Days prior to the beginning of the relevant Interest Period by reference to the British Bankers' Association Interest Settlement RatesLIBOR for deposits in the Applicable Currency (as set forth by the Bloomberg Information Service or any successor thereto or any otherservice selected by the Administrative Agent which has been nominated by the British Bankers' Association as an authorized informationvendor for the purpose of displaying such rates) for a period equal to such Interest Period; provided that, to the extent that an interest rate isnot ascertainable pursuant to the foregoing provisions of this definition, "LIBOR" shall be the interest rate per annum determined by theAdministrative Agent to be the average of the rates per annum at which deposits in the Applicable Currency in an amount equal to $5,000,000or €5,000,000, as the case may be, are offered for such relevant Interest Period to major banks in the London interbank market in London,England by the Administrative Agent at approximately 11:00 a.m. (London time) on the date that is two Business Days prior to the beginningof such Interest Period.

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"LIBO Rate": with respect to each day during each Interest Period for any LIBO Rate Loan, a rate per annum determined for such day inaccordance with the following formula (rounded upward to the nearest 1/100th of 1%):

LIBOR1.00�LIBOR Statutory Reserves

"LIBO Rate Dollar Loan": any LIBO Rate Loan denominated in Dollars.

"LIBO Rate Loan": any Loan for which the applicable rate of interest is based upon the LIBO Rate.

"LIBO Rate Tranche": the collective reference to LIBO Rate Loans under a particular Facility the then current Interest Periods withrespect to all of which begin on the same date and end on the same later date (whether on such Loans shall originally have been made on thesame day).

"LIBOR Lending Office": with respect to any Lender, the office of such Lender specified as its "LIBOR Lending Office" opposite itsname on Schedule II or on the Assignment and Acceptance by which it became a Lender (or, if no such office is specified, its DomesticLending Office) or such other office of such Lender as such Lender may from time to time specify to the Borrower and the AdministrativeAgent.

"LIBOR Statutory Reserves": the aggregate of the maximum reserve percentages (including any marginal, special, emergency orsupplemental reserves) expressed as a decimal established by the Federal Reserve Board and any other banking authority, domestic or foreign,to which the Administrative Agent or any Lender (including any branch, Lender Affiliate, or other fronting office making or holding a Loan)is subject for Eurocurrency Liabilities. Such reserve percentages shall include those imposed pursuant to Regulation D of the Board as ineffect from time to time. LIBO Rate Loans shall be deemed to constitute Eurocurrency Liabilities and to be subject to such reserverequirements without benefit of or credit for proration, exemptions or offsets that may be available from time to time to any Lender underRegulation D of the Board as in effect from time to time. LIBOR Statutory Reserves shall be adjusted automatically on and as of the effectivedate of any change in any reserve percentage.

"Lien": any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), charge or othersecurity interest (including any conditional sale or other title retention agreement, any capital lease having substantially the same economiceffect as any of the foregoing).

"Loan": any loan made by any Lender pursuant to this Agreement.

"Loan Documents": this Agreement, the Security Documents and the Notes.

"Loan Parties": Holdings, the Borrower and each Subsidiary of the Borrower that is a party to a Loan Document.

"Majority Facility Lenders": with respect to any Facility, the holders of more than 50% of the aggregate unpaid principal amount of theTranche A Term Loans or the Total Revolving Extensions of Credit, as the case may be, outstanding under such Facility (or, in the case of theRevolving Credit Facility, prior to any termination of the Revolving Credit Commitments, the holders of more than 50% of the TotalRevolving Credit Commitments).

"Majority Revolving Credit Facility Lenders": the Majority Facility Lenders in respect of the Revolving Credit Facility.

"Master Separation Agreement": the Master Separation Agreement dated on or about the Closing Date by and among KMG, Kerr-McGeeWorldwide, and Holdings.

"Material Adverse Effect": a material adverse effect on (a) the business, assets, property or condition (financial or otherwise) of theBorrower and its Subsidiaries taken as a whole, (b) the validity, enforceability or priority of the Liens purported to be created by the SecurityDocuments or (c) the validity



14



or enforceability of the Loan Documents or the material rights or remedies of the Agents or the Lenders under the Loan Documents.

"Material Contractual Obligations": (i) any Material Indebtedness; (ii) any Contractual Obligation with respect to Holdings, the Borroweror any of its Subsidiaries that is required to be filed as an exhibit to an annual report on Form 10-K of Holdings pursuant to paragraph (10) ofItem 601(b) of Regulation S-K; or (iii) any other Contractual Obligation with respect to Holdings, the Borrower or any of its Subsidiaries forwhich breach, nonperformance, cancellation or failure to renew could reasonably be expected to have a Material Adverse Effect.

"Material Indebtedness": (i) Indebtedness under the Senior Note Indenture; or (ii) any other Indebtedness of Holdings, the Borrower orany of its Subsidiaries the outstanding principal amount of which exceeds $25,000,000 in the aggregate.

"Materials of Environmental Concern": any gasoline or petroleum (including crude oil or any fraction thereof) or petroleum products,polychlorinated biphenyls, urea-formaldehyde insulation, asbestos, pollutants, contaminants, radioactivity and any other substances of anykind, that is regulated pursuant to or could give rise to liability under any Environmental Law.

"Moody's": Moody's Investors Services, Inc. or its successor.

"Mortgaged Properties": the real properties and leasehold estates listed on Schedule 1.1(c) and such other real properties and leaseholds,interests specified after the Closing Date by the Borrower to the Administrative Agent in a written notice referencing this definition, as towhich the Administrative Agent for the benefit of the Secured Parties shall be granted a Lien pursuant to the Mortgages.

"Mortgages": each of the mortgages and deeds of trust made by any Loan Party in favor of, or for the benefit of, the AdministrativeAgent for the benefit of the Secured Parties, substantially in the form of Exhibit K (with such changes thereto as shall be advisable under thelaw of the jurisdiction in which such mortgage or deed of trust is to be recorded), as the same may be amended, supplemented, replaced orotherwise modified from time to time in accordance with this Agreement.

"Multiemployer Plan": a Plan that is a multiemployer plan as defined in Section 4001(a)(3) of ERISA.

"Net Cash Proceeds": (a) in connection with any Asset Sale, Receivable Qualifying Asset Sale or any Recovery Event, the proceedsthereof in the form of cash and Cash Equivalents (including any such proceeds received by way of deferred payment of principal pursuant to anote or installment receivable or purchase price adjustment receivable or otherwise, but only as and when received) of such Asset Sale,Receivable Qualifying Asset Sale or Recovery Event, net of (i) appraisal fees, survey costs, title insurance premiums, attorneys' fees, notarialfees, accountants' fees, investment banking fees, amounts required to be applied to the repayment of Indebtedness (together with any accruedand unpaid interest thereon, premium or penalty or other amount payable with respect thereto) secured by a Lien expressly permittedhereunder on any asset which is the subject of such Asset Sale, Receivable Qualifying Asset Sale or Recovery Event (other than any Lienpursuant to a Security Document) and other reasonable and customary fees and expenses, in each case, to the extent actually incurred inconnection therewith and net of taxes paid and/or reasonably estimated to be payable as a result thereof (after taking into account any availabletax credits or deductions and any tax sharing arrangements), and (ii) solely in connection with any such Asset Sale, any reserve established inaccordance with GAAP or amounts deposited in escrow for adjustment in respect of the sale price of such asset or assets or for indemnitieswith respect to such Asset Sale, provided that any such reserved or escrowed amounts shall be Net Cash Proceeds to the extent and at the timereleased to Holdings, the Borrower or any Subsidiary and not required to be so used; and (b) in connection with any issuance or sale of debtsecurities or instruments or the incurrence of loans, the cash proceeds received from such issuance or incurrence, net of attorneys' fees,investment banking fees, accountants' fees, underwriting discounts and commissions and fees and expenses, in each case, to the extent actuallyincurred in connection therewith and net of taxes paid or reasonably estimated to be paid as

15



a result thereof (after taking into account any available tax credits or deductions and any tax sharing arrangements).

"Non-Excluded Taxes": as defined in Section 2.20(a).

"Non-U.S. Lender": as defined in Section 2.20(d).

"Note": any promissory note evidencing any Loan.

"Obligations": the unpaid principal of and interest on (including interest accruing after the maturity of the Loans and ReimbursementObligations and interest accruing after the filing of any petition in bankruptcy, or the commencement of any insolvency, reorganization or likeproceeding, relating to the Borrower, whether or not a claim for post-filing or post-petition interest is allowed in such proceeding) the Loans,the Reimbursement Obligations and all other obligations and liabilities of the Borrower to the Administrative Agent or to any Lender orIssuing Lender or any Qualified Counterparty, whether direct or indirect, absolute or contingent, due or to become due, or now existing orhereafter incurred, which may arise under, out of, or in connection with, this Agreement, any other Loan Document, the Letters of Credit, anySpecified Hedge Agreement or any other document made, delivered or given in connection herewith or therewith, whether on account ofprincipal, interest, reimbursement obligations, fees, indemnities, costs, expenses (including all fees, charges and disbursements of counsel tothe Arrangers, to the Agents or to any Lender that are required to be paid by the Borrower pursuant hereto or pursuant to any other LoanDocument) or otherwise; provided, that (i) Obligations of the Borrower or any Subsidiary under any Specified Hedge Agreement shall besecured and guaranteed pursuant to the Security Documents only to the extent that, and for so long as, the other Obligations are so secured andguaranteed and (ii) any release of Collateral or Guarantors effected in the manner permitted by this Agreement shall not require the consent ofholders of obligations under Specified Hedge Agreements.

"Other Taxes": any and all present or future stamp or documentary taxes or any other excise or property taxes, charges or similar leviesarising from any payment made hereunder or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement orany other Loan Document.

"Participant": as defined in Section 10.6(b).

"Payment Office": the office specified from time to time by the Administrative Agent as its payment office by notice to the Borrower andthe Lenders.

"PBGC": the Pension Benefit Guaranty Corporation established pursuant to Subtitle A of Title IV of ERISA (or any successor).

"Permits": the collective reference to (i) Environmental Permits, and (ii) any and all other franchises, licenses, leases, permits, approvals,notifications, certifications, registrations, authorizations, exemptions, qualifications, easements, and rights of way granted by a GovernmentalAuthority.

"Permitted Acquisitions": as defined in Section 7.8(h).

"Permitted Liens": the collective reference to (i) in the case of Collateral other than Stock Collateral, Liens permitted by Section 7.3 and(ii) in the case of Collateral consisting of Stock Collateral, non-consensual Liens permitted by Section 7.3 to the extent arising by operation oflaw.

"Person": an individual, partnership, corporation, limited liability company, business trust, joint stock company, trust, unincorporatedassociation, joint venture, Governmental Authority or other entity of whatever nature.

"Personal Property Collateral": any Property of Borrower or any Guarantor, whether now owned or hereafter acquired, constituting(i) Stock Collateral; or (ii) inventory, equipment (other than vehicles) or accounts (each as defined in the UCC) or certain other personalproperty, in each case upon which a Lien is purported to be created by any Security Document.



16



"Plan": at a particular time, any employee benefit plan that is covered by ERISA and which the Borrower (or, with respect to any SingleEmployer Plan or Multiemployer Plan, any Commonly Controlled Entity) maintains, administers, contributes to or is required to contribute toor under which the Borrower (or, with respect to any Single Employer Plan or Multiemployer Plan, any Commonly Controlled Entity) couldincur any liability.

"Pledged Stock": as defined in the Guarantee and Collateral Agreement.

"Pricing Grid": the pricing grid attached hereto as Annex A.

"Pro Forma Balance Sheet": as defined in Section 4.1(a).

"Projections": as defined in Section 6.2(c).

"Property": any right or interest in or to property of any kind whatsoever, whether real, personal or mixed and whether tangible orintangible, including Capital Stock.

"Qualified Counterparty": with respect to any Specified Hedge Agreement, any counterparty thereto that, at the time such SpecifiedHedge Agreement was entered into, was a Lender or a Lender Affiliate.

"Rating Agency": each of (i) Moody's and (ii) S&P.

"Receivables Assets": any accounts receivable, instruments, chattel paper, general intangibles and similar assets (whether now existing orarising in the future, "Receivables") of the Borrower or any of its Subsidiaries, and any assets related thereto including all collateral securingsuch Receivables, all contracts, contract rights and all guarantees or other obligations in respect of such Receivables, proceeds of suchReceivables and any other assets which are customarily transferred or in respect of which security interests are customarily granted inconnection with asset securitization transactions.

"Receivable Asset Sale": any Disposition of Receivables Assets permitted by clause (l) of Section 7.5 with respect to a ReceivableFinancing Transaction.

"Receivable Financing Transaction": any transaction or series of transactions entered into by the Borrower or any of its Subsidiariespursuant to which the Borrower or any Subsidiary sells, conveys or otherwise transfers, directly or indirectly, to (a) a Special PurposeSubsidiary (without recourse to or guarantee by any Loan Party (excluding any guarantee of obligations (other than the principal of, or intereston, Indebtedness), or recourse, pursuant to Standard Securitization Undertakings)) and (b) thereupon such Special Purpose Subsidiary sells,conveys or otherwise transfers to any other Person (or grants to any other Person a security interest in), any Receivables Assets in each case ina manner customary for asset securitization transactions involving accounts receivable.

"Receivable Qualifying Asset Sale": (i) the initial Receivable Asset Sale to any Special Purpose Subsidiary and (ii) any subsequentReceivable Asset Sale to such Special Purpose Subsidiary to the extent (and only to the extent) the consideration for the Disposition of theReceivables Assets to such Special Purpose Subsidiary is funded with the proceeds of Indebtedness or participation certificates or certificatesof beneficial interest or like instruments incurred or issued (other than to the Borrower or its Subsidiaries) by such Special Purpose Subsidiaryor any other Person to which Receivables Assets are or have been Disposed of.

"Recovery Event": any settlement of or payment in respect of any property or casualty insurance claim or any condemnation proceedingrelating to any asset of Holdings, the Borrower or any of its Subsidiaries.

"Refunded Swing Line Loans": as defined in Section 2.7(b).

"Refunding Date": as defined in Section 2.7(c).



"Register": as defined in Section 10.6(d).

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"Registration Rights Agreement": the Registration Rights Agreement, dated the Closing Date, among the Borrower, LehmanBrothers Inc. and with respect to the Senior Notes.

"Regulation D": Regulation D of the Board as in effect from time to time (and any successor to all or a portion thereof).

"Regulation H": Regulation H of the Board as in effect from time to time (and any successor to all or a portion thereof).

"Regulation U": Regulation U of the Board as in effect from time to time (and any successor to all or a portion thereof).

"Regulation X": Regulation X of the Board as in effect from time to time (and any successor to all or a portion thereof).

"Reinvestment Deferred Amount": with respect to any Reinvestment Event, the aggregate Net Cash Proceeds received by Holdings, theBorrower or any of its Subsidiaries in connection therewith that are specified in a Reinvestment Notice as not being required to be initiallyapplied to prepay the Tranche A Term Loans pursuant to Section 2.12(b) as a result of the delivery of a Reinvestment Notice.

"Reinvestment Event": any Asset Sale or Recovery Event in respect of which the Borrower has duly delivered a Reinvestment Notice.

"Reinvestment Event Assets": the assets that were the subject of a Reinvestment Event.

"Reinvestment Notice": a written notice executed by a Responsible Officer of the Borrower stating that no Event of Default has occurredand is continuing and that the Borrower (directly or indirectly through a Subsidiary) intends and expects to use all or a specified portion of theNet Cash Proceeds of an Asset Sale or Recovery Event specified in such notice to acquire or repair Collateral (or, to the extent theReinvestment Event Assets were not Collateral, any assets) owned (or to be owned) by and useful in the business of the Borrower or aSubsidiary Guarantor (or, if the Reinvestment Event Assets were not owned by the Borrower or a Subsidiary Guarantor, the Borrower or anySubsidiary thereof).

"Reinvestment Prepayment Amount": with respect to any Reinvestment Event, the Reinvestment Deferred Amount relating thereto lessany amount expended prior to the relevant Reinvestment Prepayment Date to acquire or repair Collateral (or, to the extent the ReinvestmentEvent Assets were not Collateral, any assets) owned (or to be owned) by and useful in the business of the Borrower or a Subsidiary Guarantor(or, if the Reinvestment Event Assets were not owned by the Borrower or a Subsidiary Guarantor, the Borrower or any Subsidiary thereof).

"Reinvestment Prepayment Date": with respect to any Reinvestment Event, the earlier of (a) the date occurring one year after suchReinvestment Event and (b) the date on which the Borrower shall have determined not to, or shall have otherwise ceased to, with all or anyportion of the relevant Reinvestment Deferred Amount acquire or repair Collateral (or, to the extent the Reinvestment Event Assets were notCollateral, any assets) owned (or to be owned) by and useful in the business of the Borrower or a Subsidiary Guarantor (or, if theReinvestment Event Assets were not owned by the Borrower or a Subsidiary Guarantor, the Borrower or any Subsidiary thereof).

"Reorganization": with respect to any Multiemployer Plan, the condition that such plan is in reorganization within the meaning ofSection 4241 of ERISA.

"Reportable Event": any of the events set forth in Section 4043(c) of ERISA, other than those events as to which the thirty day noticeperiod is waived under subsections .27, .28, .29, .30, .31, .32, .34 or .35 of PBGC Reg. § 4043.

"Required Lenders": at any time, the holders of more than 50% of (a) until the Closing Date, the Commitments and (b) thereafter, thesum of (i) the aggregate unpaid principal amount of the Tranche A

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Term Loans then outstanding and (ii) the Total Revolving Credit Commitments then in effect or, if the Revolving Credit Commitments havebeen terminated, the Total Revolving Extensions of Credit then outstanding.

"Requirement of Law": as to any Person, the Governing Documents of such Person, and any law, treaty, rule or regulation ordetermination of an arbitrator or a court or other Governmental Authority, in each case applicable to or binding upon such Person or any of itsProperty or to which such Person or any of its Property is subject.

"Responsible Officer": as to any Person, the chief executive officer, president or chief financial officer or treasurer of such Person, but inany event, with respect to financial matters, the chief financial officer or treasurer of such Person. Unless otherwise qualified, all references toa "Responsible Officer" shall refer to a Responsible Officer of the Borrower.

"Restricted Payments": as defined in Section 7.6.

"Revolving Credit Base Rate Loan": a Revolving Credit Loan that is a Base Rate Loan.

"Revolving Credit Commitment": as to any Lender, the obligation of such Lender, if any, to make Revolving Credit Loans andparticipate in Swing Line Loans and Letters of Credit, in an aggregate principal and/or face amount not to exceed the amount set forth underthe heading "Revolving Credit Commitment" opposite such Lender's name on Schedule 1 to the Lender Addendum delivered by such Lender,or, as the case may be, in the Assignment and Acceptance pursuant to which such Lender became a party hereto, as the same may be changedfrom time to time pursuant to the terms hereof. The original aggregate amount of the Total Revolving Credit Commitments is $250,000,000.

"Revolving Credit Commitment Period": the period from and including the Closing Date to the Revolving Credit Termination Date.

"Revolving Credit Euro Loan": a Revolving Credit Loan denominated in euro.

"Revolving Credit Facility": as defined in the definition of "Facility" in this Section 1.1.

"Revolving Credit Lender": each Lender that has a Revolving Credit Commitment or that is the holder of Revolving Credit Loans.

"Revolving Credit LIBO Rate Dollar Loan": a Revolving Credit Loan denominated in dollars that is a LIBO Rate Loan.

"Revolving Credit Loans": as defined in Section 2.4.

"Revolving Credit Note": as defined in Section 2.8.

"Revolving Credit Percentage": as to any Revolving Credit Lender at any time, the percentage which such Lender's Revolving CreditCommitment then constitutes of the Total Revolving Credit Commitments (or, at any time after the Revolving Credit Commitments shall haveexpired or terminated, the percentage which the aggregate principal or face amount of such Lender's Revolving Extensions of Credit thenoutstanding constitutes the aggregate principal or face amount of the Total Revolving Extensions of Credit then outstanding).

"Revolving Credit Termination Date": the earliest of (i) the Scheduled Revolving Credit Termination Date, (ii) the date of termination ofthe Revolving Credit Commitments pursuant to Section 2.10 and (iii) the date on which the Obligations become due and payable pursuant toSection 8.

"Revolving Extensions of Credit": as to any Revolving Credit Lender at any time, an amount equal to the sum of (a) the DollarEquivalent of the aggregate principal amount of all Revolving Credit Loans made by such Lender then outstanding, (b) such Lender'sRevolving Credit Percentage of the Dollar

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Equivalent of the L/C Obligations then outstanding and (c) such Lender's Revolving Credit Percentage of the aggregate principal amount ofSwing Line Loans then outstanding.

"S&P": Standard & Poor's Ratings Group or its successor.

"Scheduled Revolving Credit Termination Date": , 2010, the fifth anniversary of the Closing Date.

"SEC": the Securities and Exchange Commission (or successors thereto or an analogous Governmental Authority).

"Secured Parties": collectively, the Arrangers, the Administrative Agent, the Lenders and, with respect to any Specified HedgeAgreement, any Qualified Counterparty that has agreed to be bound by the provisions of Section 7.2 of the Guarantee and CollateralAgreement as if it were a party thereto and by the provisions of Section 9 hereof as if it were a Lender party hereto.

"Security Documents": the collective reference to the Guarantee and Collateral Agreement, the Mortgages, and all other securitydocuments hereafter delivered to the Administrative Agent granting a Lien on any Property of any Person to secure the obligations andliabilities of any Loan Party under any Loan Document.

"Senior Note Documentation": the Senior Note Indenture and the Registration Rights Agreement, together with any other instruments andagreements entered into by the Borrower or its Subsidiaries pursuant thereto (other than the Loan Documents), as the same may be amended,supplemented, replaced or otherwise modified from time to time in accordance with this Agreement.

"Senior Note Indenture": the Indenture entered into by the Borrower and certain of its Subsidiaries in connection with the issuance of theSenior Notes, together with all instruments and other agreements entered into by the Borrower or such Subsidiaries in connection therewith, asthe same may be amended, supplemented, replaced or otherwise modified from time to time in accordance with Section 7.9.

"Senior Notes": the senior notes of the Borrower and Tronox Finance initially due 2012 issued from time to time pursuant to the SeniorNote Indenture.

"Senior Unsecured Debt Documents": as defined in Section 7.2(n).

"Senior Note Refinancing Documents": as defined in Section 7.2(f).

"Single Employer Plan": any Plan that is covered by Title IV of ERISA, but which is not a Multiemployer Plan.

"Solvent": with respect to any Person, as of any date of determination, (a) the amount of the "present fair saleable value" of the assets ofsuch Person will, as of such date, exceed the amount of all "liabilities of such Person, contingent or otherwise", as of such date, as such quotedterms are determined in accordance with applicable federal and state laws governing determinations of the insolvency of debtors, (b) thepresent fair saleable value (as such term is defined in clause (a)) of the assets of such Person will, as of such date, be greater than the amountthat will be required to pay the liability of such Person on its debts as such debts become absolute and matured, (c) such Person will not have,as of such date, an unreasonably small amount of capital with which to conduct its business and (d) such Person will be able to pay its debts asthey mature. For purposes of this definition, (i) "debt" means liability on a "claim", and (ii) "claim" means any (x) right to payment, whetheror not such a right is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed, legal,equitable, secured or unsecured or (y) right to an equitable remedy for breach of performance if such breach gives rise to a right to payment,whether or not such right to an equitable remedy is reduced to judgment, fixed, contingent, matured or unmatured, disputed, undisputed,secured or unsecured; provided that, for purposes of this definition, in computing the amount of any contingent, unliquidated, unmatured ordisputed claim at any time, it is intended that such claims will be computed at the amount which, in light of all the facts and

20



circumstances existing at such time, represents the amount that can reasonably be expected to become an actual, liquidated or matured claim.

"Solvency Certificate": the Solvency Certificate to be executed and delivered by the chief financial officer of the Borrower, substantiallyin the form of Exhibit J, as the same may be amended, supplemented or otherwise modified from time to time in accordance with thisAgreement.

"Special Purpose Subsidiary": any Subsidiary of the Borrower (other than a Subsidiary Guarantor):

(a) which has been created by the Borrower or any of its Subsidiaries for the sole purpose of facilitating, and which engages inno activities other than in connection with, Receivable Financing Transactions;

(b) which is designated by a Responsible Officer of the Borrower (as provided below) as a Special Purpose Subsidiary;

(c) no portion of the Indebtedness or any other obligations (contingent or otherwise) of which (i) is guaranteed by theBorrower or any other Subsidiary (excluding guarantees of obligations (other than the principal of, or interest on, Indebtedness)pursuant to Standard Securitization Undertakings), (ii) is recourse to or obligates the Borrower or any other Subsidiary in any wayother than pursuant to Standard Securitization Undertakings or (iii) subjects any property or asset of the Borrower or any otherSubsidiary, directly or indirectly, contingently or otherwise, to the satisfaction thereof, other than pursuant to StandardSecuritization Undertakings;

(d) with which neither the Borrower nor any other Subsidiary has any material contract, agreement, arrangement orunderstanding (except in connection with a Receivable Financing Transaction) other than on terms no less favorable to the Borroweror such other Subsidiary than those that might be obtained at the time from persons that are not Affiliates of the Borrower, otherthan as may be customary in accounts receivable transactions including fees payable in connection with servicing accountsreceivable;

(e) to which neither the Borrower nor any other Subsidiary has any obligation to maintain or preserve such entity's financialcondition or cause such entity to achieve certain levels of operating results; and

(f) which has no Subsidiaries.

Any such designation by a Responsible Officer of the Borrower shall be evidenced to the Administrative Agent by filing with theAdministrative Agent a certificate of the Borrower certifying, to the best of such officer's knowledge and belief after consulting with counsel,that such designation complies with the foregoing conditions.

"Specified Change of Control": a "Change of Control" or similar event (howsoever defined) as defined in the Senior Note Indenture.

"Specified Hedge Agreement": any Hedge Agreement (a) entered into by (i) any Loan Party and (ii) any Qualified Counterparty and(b) which has been designated by such Lender and the Borrower, by notice to the Administrative Agent not later than 90 days after theexecution and delivery thereof by any such Loan Party as a Specified Hedge Agreement; provided that the designation of any HedgeAgreement as a Specified Hedge Agreement shall not create in favor of any Lender or Qualified Counterparty that is a party thereto any rightsin connection with the management or release of any Collateral or of the obligations of any Guarantor under the Guarantee and CollateralAgreement.

"Spin-Off/Split-Off": the pro rata or non pro rata transfer by KMG to its stockholders of 100% of the outstanding class B common stockof Holdings in a distribution intended to be tax free under Section 355 and 368(a)(1)(D) of the Internal Revenue Code.

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"Standard Securitization Undertakings": representations, warranties, covenants and indemnities entered into by the Borrower or anySubsidiary transferring Receivables Assets to a Special Purpose Subsidiary in connection with a Receivable Financing Transaction which arereasonably customary and market in an accounts receivable securitization transaction.

"Stock Collateral": (i) with respect to Borrower or any Domestic Subsidiary thereof (other than a Special Purpose Subsidiary), all CapitalStock thereof; or (ii) with respect to any direct Foreign Subsidiary (other than a Special Purpose Subsidiary) of the Borrower or anySubsidiary Guarantor, (x) 65% of the voting Capital Stock thereof and (y) 100% of the non-voting Capital Stock thereof.

"Subordinated Debt Documents": as defined in Section 7.2(o).

"Subsidiary": as to any Person, a corporation, partnership, limited liability company or other entity of which shares of stock or otherownership interests having ordinary voting power (other than stock or such other ownership interests having such power only by reason of thehappening of a contingency) to elect a majority of the board of directors or other managers of such corporation, partnership or other entity areat the time owned, or the management of which is otherwise controlled, directly or indirectly through one or more intermediaries, or both, bysuch Person. Unless otherwise qualified, all references to a "Subsidiary" or to "Subsidiaries" in this Agreement shall refer to a Subsidiary orSubsidiaries of the Borrower.

"Subsidiary Guarantor": at any time, (i) Tronox Finance and (ii) each direct or indirect Domestic Subsidiary of the Borrower other than(x) KMEMC and (y) any Domestic Subsidiary of the Borrower that is either (A) an Immaterial Subsidiary or Special Purpose Subsidiary atsuch time, or (B) not a party to the Guarantee and Collateral Agreement as "Grantor" and "Guarantor" thereunder at such time.

"Swing Line Commitment": the obligation of the Swing Line Lender to make Swing Line Loans pursuant to Section 2.6 in an aggregateprincipal amount at any one time outstanding not to exceed $25,000,000.

"Swing Line Lender": Lehman Commercial Paper Inc. or such other Lender (in its capacity as the lender of Swing Line Loans) as may beappointed by the Borrower with the consent of the Administrative Agent (which consent shall not be unreasonably withheld or delayed).

"Swing Line Loans": as defined in Section 2.6.

"Swing Line Note": as defined in Section 2.8(e).

"Swing Line Participation Amount": as defined in Section 2.7(c).

"Syndication Agent": as defined in the preamble hereto.

"Syndication Date": the date which is 90 days after the Closing Date or such earlier date that the Administrative Agent determines thesyndication is complete.

"Syndication Letter Agreement": the engagement letter agreement, dated as of October 26, 2005 among KMG, Holdings, the Borrower,Lehman Commercial Paper Inc. and the Arrangers relating to the syndication of the Facilities.

"Term Notes": as defined in Section 2.8(e).

"Total Revolving Credit Commitments": at any time, the aggregate amount of the Revolving Credit Commitments then in effect.

"Total Revolving Extensions of Credit": at any time, the aggregate amount of the Revolving Extensions of Credit of the Revolving CreditLenders outstanding at such time.

"Tranche A Term Loan": as defined in Section 2.1.



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"Tranche A Term Loan Commitment": as to any Lender, the obligation of such Lender, if any, to make a Tranche A Term Loan to theBorrower hereunder in a principal amount not to exceed the amount set forth under the heading "Tranche A Term Loan Commitment"opposite such Lender's name on Schedule 1 to the Lender Addendum delivered by such Lender, or, as the case may be, in the Assignment andAcceptance pursuant to which such Lender became a party hereto, as the same may be changed from time to time pursuant to the terms hereof.The original aggregate amount of the Tranche A Term Loan Commitments is $200,000,000.

"Tranche A Term Loan Facility": as defined in the definition of "Facility" in this Section 1.1.

"Tranche A Term Loan Lender": each Lender that has a Tranche A Term Loan Commitment or is the holder of a Tranche A Term Loan.

"Tranche A Term Loan Maturity Date": , 2011, the sixth anniversary of the Closing Date.

"Tranche A Term Loan Percentage": as to any Tranche A Term Loan Lender at any time, the percentage which such Lender's Tranche ATerm Loan Commitment then constitutes of the aggregate Tranche A Term Loan Commitments (or, at any time after the Closing Date, thepercentage which the aggregate principal amount of such Lender's Tranche A Term Loans then outstanding constitutes of the aggregateprincipal amount of the Tranche A Term Loans then outstanding).

"Transaction": the Contribution, the IPO, the Distribution and, if applicable, the Spin-Off/Split-Off.

"Transaction Agreements": (i) that certain Assignment, Assumption and Indemnity Agreement, dated December 31, 2002, by andbetween the Borrower and Kerr-McGee Oil & Gas Corporation, a Delaware corporation and an indirect wholly-owned subsidiary of KMG,(ii) the Master Separation Agreement, (iii) that certain Registration Rights Agreement dated on or about the Closing Date by and betweenKMG and Holdings, (iv) that certain Transitional License Agreement dated on or about the Closing Date by and among Kerr McGeeWorldwide and Holdings, (v) that certain Tax Sharing Agreement dated on or about the Closing Date by and between KMG and Holdings,(vi) that certain Employee Benefits Agreement dated on or about the Closing Date by and between KMG and Holdings, and (vii) that certainTransition Services Agreement dated on or about the Closing Date by and among KMG, Kerr-McGee Worldwide and Holdings, in each case,as the same may be amended, supplemented, replaced or otherwise modified from time to time in accordance with Section 7.16.

"Transaction Documentation": collectively, the Transaction Agreements and all schedules, exhibits, annexes and amendments thereto andall side letters and agreements affecting the terms thereof or entered into in connection therewith, in each case, as amended, supplemented,replaced or otherwise modified from time to time in accordance with this Agreement.

"Transferee": as defined in Section 10.14.

"Tronox Finance": Tronox Finance Corp., a Delaware corporation.

"Type": as to any Loan, its nature as a Base Rate Loan or a LIBO Rate Loan.

"UCC": the Uniform Commercial Code, as in effect in any jurisdiction from time to time.

"Valuation Date": (i) the date three Business Days prior to the making of any Revolving Credit LIBO Rate Dollar Loan, the continuationof any Revolving Credit LIBO Rate Dollar Loan, the conversion of any Revolving Credit Base Rate Loan into a Revolving Credit LIBO RateDollar Loan, the conversion of any Revolving Credit LIBO Rate Dollar Loan into a Revolving Credit Base Rate Loan or issuance of anyLetter of Credit denominated in Dollars, (ii) the date three Business Days prior to the making of any Revolving Credit Euro Loan, thecontinuation of any Revolving Credit Euro Loan or the issuance of any Letter of Credit (Euro), (iii) the date two Business Days prior to themaking of any Revolving Credit Base Rate Loan, (iv) the last Business Day of any calendar quarter, and (v) any other date designated by theAdministrative Agent.

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"Wholly Owned Subsidiary": as to any Person, any other Person all of the Capital Stock of which (other than directors' qualifying sharesrequired by law) is owned by such Person directly or through other Wholly Owned Subsidiaries.

"Wholly Owned Subsidiary Guarantor": any Subsidiary Guarantor that is a Wholly Owned Subsidiary of the Borrower.

1.2 Other Definitional Provisions. (a) Unless otherwise specified therein, all terms defined in this Agreement shall have the definedmeanings when used in the other Loan Documents or any certificate or other document made or delivered pursuant hereto or thereto.

(b) As used herein and in the other Loan Documents, and any certificate or other document made or delivered pursuant hereto orthereto, accounting terms relating to Holdings, the Borrower and its Subsidiaries not defined in Section 1.1 and accounting terms partlydefined in Section 1.1, to the extent not defined, shall have the respective meanings given to them under GAAP.

(c) The words "hereof", "herein" and "hereunder" and words of similar import when used in this Agreement shall refer to thisAgreement as a whole and not to any particular provision of this Agreement, and Section, Schedule and Exhibit references are to thisAgreement unless otherwise specified.

(d) The meanings given to terms defined herein shall be equally applicable to both the singular and plural forms of such terms.

(e) All calculations of financial ratios set forth in Section 7.1 shall be calculated to the same number of decimal places as the relevantratios are expressed in and shall be rounded upward if the number in the decimal place immediately following the last calculated decimalplace is five or greater and shall be rounded down if the number in the decimal place immediately following the last calculated decimal placeis four or lower. For example, if the relevant ratio is to be calculated to the hundredth decimal place and the calculation of the ratio is (i) 5.126,the ratio will be rounded up to 5.13 and (ii) 5.124, the ratio will be rounded down to 5.12.

(f) The expressions "payment in full," "paid in full" and any other similar terms or phrases when used herein with respect to theObligations shall mean the payment in full, in immediately available funds, of all of the Obligations (other than Obligations in respect of anySpecified Hedge Agreement and unmatured contingent reimbursement and indemnification Obligations).

(g) The words "including" and "includes" and words of similar import when used in this Agreement shall not be limiting and shall mean"including without limitation" or "includes without limitation", as the case may be.

(h) In this Agreement, in the computation of periods of time from a specified date to a later specified date, the word "from" means "fromand including" and the words "to" and "until" each mean "to but excluding" and the word "through" means "to and including."

(i) References in this Agreement to any statute, law, treaty, rule or regulation of any Governmental Authority shall be to such statute,law, treaty, rule or regulation of any Governmental Authority as amended or modified and in effect at the time any such reference is operative.

(j) References in this Agreement to any agreements or other Contractual Obligations shall, unless otherwise specified, be deemed torefer to such agreements or Contractual Obligations as amended, supplemented, restated or otherwise modified from time to time.

(k) The terms "Lender" and "Administrative Agent" include their respective successors.

(l) The words "asset" and "property" shall be construed to have the same meaning and effect and to refer to any and all tangible andintangible assets and properties, including cash, Capital Stock, securities, revenues, accounts, leasehold interests and contract rights.

SECTION 2. AMOUNT AND TERMS OF COMMITMENTS

2.1 Tranche A Term Loan Commitments. Subject to the terms and conditions hereof, the Tranche A Term Loan Lenders severallyagree to make term loans (each, a "Tranche A Term Loan") denominated in Dollars to the Borrower on the Closing Date in an amount for eachTranche A Term Loan Lender not to exceed the amount of the Tranche A Term Loan Commitment of such Lender. The Tranche A TermLoans may from time to time be LIBO Rate Loans or Base Rate Loans, as determined by the Borrower and notified to the AdministrativeAgent in accordance with Sections 2.2 and 2.13.



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2.2 Procedure for Tranche A Term Loan Borrowing. The Borrower shall deliver to the Administrative Agent a Borrowing Notice(which Borrowing Notice must be received by the Administrative Agent prior to 10:00 A.M., New York City time, (a) three Business Daysprior to the anticipated Closing Date, in the case of LIBO Rate Loans or (b) on the anticipated Closing Date, in the case of Base Rate Loans)requesting that the Tranche A Term Loan Lenders make the Tranche A Term Loans on the Closing Date and specifying the amount to beborrowed. The Tranche A Term Loans made on the Closing Date shall initially be Base Rate Loans and no Tranche A Term Loans may beconverted into a LIBO Rate Loan prior to the date that is 7 days after the Closing Date. Upon receipt of such Borrowing Notice theAdministrative Agent shall promptly notify each Tranche A Term Loan Lender thereof. Not later than 12:00 Noon, New York City time, onthe Closing Date each Tranche A Term Loan Lender shall make available to the Administrative Agent at the Funding Office an amount inimmediately available funds equal to the Tranche A Term Loan or Tranche A Term Loans to be made by such Lender. The AdministrativeAgent shall make available to the Borrower the aggregate of the amounts made available to the Administrative Agent by the Tranche A TermLoan Lenders, in like funds as received by the Administrative Agent.

2.3 Repayment of Tranche A Term Loans. The Tranche A Term Loan of each Tranche A Term Loan Lender shall mature in 24consecutive quarterly installments, commencing on March 31, 2006, each of which shall be in an amount equal to such Lender's Tranche ATerm Loan Percentage multiplied by the percentage set forth below opposite such installment of the aggregate principal amount of Tranche ATerm Loans made on the Closing Date:

Installment Percentage

March 31, 2006 0.25%June 30, 2006 0.25%September 30, 2006 0.25%December 31, 2006 0.25%March 31, 2007 0.25%June 30, 2007 0.25%September 30, 2007 0.25%December 31, 2007 0.25%March 31, 2008 0.25%June 30, 2008 0.25%September 30, 2008 0.25%December 31, 2008 0.25%March 31, 2009 0.25%June 30, 2009 0.25%September 30, 2009 0.25%December 31, 2009 0.25%March 31, 2010 0.25%June 30, 2010 0.25%September 30, 2010 0.25%December 31, 2010 0.25%March 31, 2011 23.75%June 30, 2011 23.75%September 30, 2011 23.75%Tranche A Term Loan Maturity Date 23.75%

2.4 Revolving Credit Commitments. (a) Subject to the terms and conditions hereof, the Revolving Credit Lenders severally agree tomake revolving credit loans ("Revolving Credit Loans") denominated in Dollars or (subject to Sections 2.17 or 2.22) euro to the Borrowerfrom time to time during the Revolving Credit Commitment Period in an aggregate amount having a Dollar Equivalent at any one time

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outstanding for each Revolving Credit Lender which, when added to such Lender's Revolving Credit Percentage of the sum of (i) the DollarEquivalent of the L/C Obligations then outstanding and (ii) the aggregate principal amount of the Swing Line Loans then outstanding, doesnot exceed such Lender's Revolving Credit Commitment (or, prior to the first Business Day after the Closing Date, such Lender's RevolvingCredit Percentage of $25,000,000). During the Revolving Credit Commitment Period the Borrower may use the Revolving CreditCommitments by borrowing, prepaying the Revolving Credit Loans in whole or in part, and reborrowing, all in accordance with the terms andconditions hereof. The Revolving Credit Loans may from time to time be LIBO Rate Loans or Base Rate Loans, as determined by theBorrower and notified to the Administrative Agent in accordance with Sections 2.5 and 2.13, provided that all Revolving Euro Loans shall bemade as LIBO Rate Loans and shall not be available as Base Rate Loans.

(b) The Borrower shall repay all outstanding Revolving Credit Loans on the Revolving Credit Termination Date.

2.5 Procedure for Revolving Credit Borrowing. The Borrower may borrow under the Revolving Credit Commitments on any BusinessDay during the Revolving Credit Commitment Period, provided that the Borrower shall deliver to the Administrative Agent a BorrowingNotice (which Borrowing Notice must be received by the Administrative Agent (a) prior to 12:00 Noon, New York City time, three BusinessDays prior to the requested Borrowing Date, in the case of LIBO Rate Loans, (b) prior to 10:00 A.M. New York City time, on the requestedBorrowing Date, in the case of Base Rate Loans), specifying (i) the Applicable Currency and the amount and Type of Revolving Credit Loansto be borrowed, (ii) the requested Borrowing Date and (iii) in the case of LIBO Rate Loans, the length of the initial Interest Period therefor.Each borrowing of Revolving Credit Loans under the Revolving Credit Commitments shall be in an amount equal to (x) in the case of BaseRate Loans, $1,000,000 or a whole multiple thereof (or, if the then aggregate Available Revolving Credit Commitments is less than$1,000,000, such lesser amount), (y) in the case of LIBO Rate Loans denominated in Dollars, $1,000,000 or a whole multiple of $1,000,000 inexcess thereof, and (z) in the case of Revolving Euro Loans, €1,000,000 or a whole multiple of €1,000,000 in excess thereof; provided, thatthe Swing Line Lender may request, on behalf of the Borrower, borrowings of Base Rate Loans under the Revolving Credit Commitments inother amounts pursuant to Section 2.7. Upon receipt of any such Borrowing Notice from the Borrower, the Administrative Agent shallpromptly notify each Revolving Credit Lender thereof. Each Revolving Credit Lender will make its Revolving Credit Percentage of theamount of each borrowing of Revolving Credit Loans available to the Administrative Agent in the Applicable Currency for the account of theBorrower at the Funding Office prior to 12:00 Noon, New York City time, or 12:00 Noon, London time (in the case of Revolving Euro Loans)on the Borrowing Date requested by the Borrower in funds immediately available to the Administrative Agent. Such borrowing will then bemade available to the Borrower by the Administrative Agent in like funds as received by the Administrative Agent.

2.6 Swing Line Commitment. (a) Subject to the terms and conditions hereof, the Swing Line Lender agrees that, during the RevolvingCredit Commitment Period, it will make available to the Borrower in the form of swing line loans ("Swing Line Loans") denominated inDollars a portion of the credit otherwise available to the Borrower under the Revolving Credit Commitments; provided that (i) the aggregateprincipal amount of Swing Line Loans outstanding at any time shall not exceed the Swing Line Commitment then in effect (notwithstandingthat the Swing Line Loans outstanding at any time, when aggregated with the Swing Line Lender's other outstanding Revolving Credit Loanshereunder, may exceed the Swing Line Commitment then in effect or such Swing Line Lender's Revolving Credit Commitment then in effect)and (ii) the Borrower shall not request, and the Swing Line Lender shall not make, any Swing Line Loan if, after giving effect to the makingof such Swing Line Loan, the aggregate amount of the Available Revolving Credit Commitments at such time would be less than zero. Duringthe Revolving Credit Commitment Period, the Borrower may use the Swing Line Commitment by borrowing,

26



repaying and reborrowing, all in accordance with the terms and conditions hereof. Swing Line Loans shall be Base Rate Loans only.

(b) The Borrower shall repay all outstanding Swing Line Loans on the Revolving Credit Termination Date.

2.7 Procedure for Swing Line Borrowing; Refunding of Swing Line Loans. (a) The Borrower may borrow under the Swing LineCommitment on any Business Day during the Revolving Credit Commitment Period, provided, the Borrower shall give the Swing LineLender irrevocable telephonic notice confirmed promptly in writing (which telephonic notice must be received by the Swing Line Lender notlater than 1:00 P.M., New York City time, on the proposed Borrowing Date), specifying (i) the amount to be borrowed and (ii) the requestedBorrowing Date. Each borrowing under the Swing Line Commitment shall be in an amount equal to $500,000 or a whole multiple of $100,000in excess thereof. Not later than 3:00 P.M., New York City time, on the Borrowing Date specified in the borrowing notice in respect of anySwing Line Loan, the Swing Line Lender shall make available to the Administrative Agent at the Funding Office an amount in immediatelyavailable funds equal to the amount of such Swing Line Loan. The Administrative Agent shall make the proceeds of such Swing Line Loanavailable to the Borrower on such Borrowing Date in like funds as received by the Administrative Agent.

(b) The Swing Line Lender, at any time and from time to time in its sole and absolute discretion may, on behalf of the Borrower (whichhereby irrevocably directs the Swing Line Lender to act on its behalf), on one Business Day's notice given by the Swing Line Lender no laterthan 12:00 Noon, New York City time, request each Revolving Credit Lender to make, and each Revolving Credit Lender hereby agrees tomake, a Revolving Credit Loan (which shall initially be a Base Rate Loan), in an amount equal to such Revolving Credit Lender's RevolvingCredit Percentage of the aggregate amount of the Swing Line Loans (the "Refunded Swing Line Loans") outstanding on the date of suchnotice, to repay the Swing Line Lender. Each Revolving Credit Lender shall make the amount of such Revolving Credit Loan available to theAdministrative Agent at the Funding Office in immediately available funds, not later than 10:00 A.M., New York City time, one Business Dayafter the date of such notice. The proceeds of such Revolving Credit Loans shall be made immediately available by the Administrative Agentto the Swing Line Lender for application by the Swing Line Lender to the repayment of the Refunded Swing Line Loans. The Borrowerirrevocably authorizes the Swing Line Lender to charge the Borrower's accounts with the Administrative Agent (up to the amount available ineach such account) in order to pay the amount of such Refunded Swing Line Loans when due and payable by the Borrower pursuant toSection 2.6(b) to the extent amounts received from the Revolving Credit Lenders are not sufficient to repay in full such Refunded Swing LineLoans.

(c) If prior to the time a Revolving Credit Loan would have otherwise been made pursuant to Section 2.7(b), one of the events describedin Section 8(f) shall have occurred and be continuing with respect to the Borrower, or if for any other reason, as determined by the Swing LineLender in its sole discretion, Revolving Credit Loans may not be made as contemplated by Section 2.7(b), each Revolving Credit Lender shall,on the date such Revolving Credit Loan was to have been made pursuant to the notice referred to in Section 2.7(b) (the "Refunding Date"),purchase for cash an undivided participating interest in the then outstanding Swing Line Loans by paying to the Swing Line Lender an amount(the "Swing Line Participation Amount") equal to (i) such Revolving Credit Lender's Revolving Credit Percentage times (ii) the sum of theaggregate principal amount of Swing Line Loans then outstanding which were to have been repaid with such Revolving Credit Loans.

(d) Whenever, at any time after the Swing Line Lender has received from any Revolving Credit Lender such Lender's Swing LineParticipation Amount, the Swing Line Lender receives any payment on account of the Swing Line Loans, the Swing Line Lender willdistribute to such Lender its Swing Line Participation Amount (appropriately adjusted, in the case of interest payments, to reflect the period oftime during which such Lender's participating interest was outstanding and funded and, in the case of

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principal and interest payments, to reflect such Lender's pro rata portion of such payment if such payment is not sufficient to pay the principalof and interest on all Swing Line Loans then due); provided, however, that in the event that such payment received by the Swing Line Lenderis required to be returned, such Revolving Credit Lender will return to the Swing Line Lender any portion thereof previously distributed to itby the Swing Line Lender.

(e) Each Revolving Credit Lender's obligation to make the Loans referred to in Section 2.7(b) and to purchase participating interestspursuant to Section 2.7(c) shall be absolute and unconditional and shall not be affected by any circumstance, including (i) any setoff,counterclaim, recoupment, defense or other right which such Revolving Credit Lender or the Borrower may have against the Swing LineLender, the Borrower or any other Person for any reason whatsoever; (ii) the occurrence or continuance of a Default or an Event of Default orthe failure to satisfy any of the other conditions specified in Section 5; (iii) any adverse change in the condition (financial or otherwise) of theBorrower; (iv) any breach of this Agreement or any other Loan Document by the Borrower, any other Loan Party or any other RevolvingCredit Lender; or (v) any other circumstance, happening or event whatsoever, whether or not similar to any of the foregoing.

2.8 Repayment of Loans; Evidence of Debt. (a) The Borrower hereby unconditionally promises to pay to the Administrative Agent forthe account of the appropriate Revolving Credit Lender or Tranche A Term Loan Lender, as the case may be, (i) the then unpaid principalamount of each Revolving Credit Loan of such Revolving Credit Lender on the Revolving Credit Termination Date (or on such earlier date onwhich the Loans become due and payable pursuant to Section 8), (ii) the then unpaid principal amount of each Swing Line Loan of suchSwing Line Lender on the Revolving Credit Termination Date (or on such earlier date on which the Loans become due and payable pursuantto Section 8) and (iii) the principal amount of each Tranche A Term Loan of such Tranche A Term Loan Lender in installments according tothe amortization schedule set forth in Section 2.3 (or on such earlier date on which the Loans become due and payable pursuant to Section 8).The Borrower hereby further agrees to pay interest on the unpaid principal amount of the Loans from time to time outstanding from the datehereof until payment in full thereof at the rates per annum, and on the dates, set forth in Section 2.15.

(b) Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing indebtedness of the Borrower tosuch Lender resulting from each Loan of such Lender from time to time, including the amounts of principal and interest payable and paid tosuch Lender from time to time under this Agreement.

(c) The Administrative Agent, on behalf of the Borrower, shall maintain the Register pursuant to Section 10.6(d), and a subaccounttherein for each Lender, in which shall be recorded (i) the amount and Applicable Currency of each Loan made hereunder and any Noteevidencing such Loan, the Type of such Loan and each Interest Period applicable thereto, (ii) the amount of any principal or interest due andpayable or to become due and payable from the Borrower to each Lender hereunder and (iii) both the amount of any sum received by theAdministrative Agent hereunder from the Borrower and each Lender's share thereof.

(d) The entries made in the Register and the accounts of each Lender maintained pursuant to Section 2.8(b) shall, to the extent permittedby applicable law, be prima facie evidence of the existence and amounts of the obligations of the Borrower therein recorded; provided,however, that the failure of any Lender or the Administrative Agent to maintain the Register or any such account, or any error therein, shallnot in any manner affect the obligation of the Borrower to repay (with applicable interest) the Loans made to the Borrower by such Lender inaccordance with the terms of this Agreement.

(e) The Borrower agrees that, upon the request to the Administrative Agent and the Borrower by any Lender, the Borrower willpromptly execute and deliver to such Lender a promissory note of the Borrower evidencing any Tranche A Term Loans, Revolving CreditLoans or Swing Line Loans, as the case may be, of such Lender, substantially in the forms of Exhibit F-1, F-2 or F-3, respectively (a "TermNote",

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"Revolving Credit Note" or "Swing Line Note", respectively), with appropriate insertions as to date and principal amount; provided, thatdelivery of Notes shall not be a condition precedent to the occurrence of the Closing Date or the making of the Loans on the Closing Date.

2.9 Commitment Fees, etc. (a) The Borrower agrees to pay to the Administrative Agent for the account of each Revolving CreditLender (other than any Defaulting Lender) a commitment fee for the period from and including the Closing Date to the last day of theRevolving Credit Commitment Period, computed at the Commitment Fee Rate on the average daily amount of the Available Revolving CreditCommitment of such Lender during the period for which payment is made, payable quarterly in arrears on the last day of each March, June,September and December and on the Revolving Credit Termination Date, commencing on the first of such dates to occur after the ClosingDate.

(b) Holdings and the Borrower agrees to pay to the Arrangers on the Closing Date the fees in the amounts previously agreed to inwriting by the Borrower and the Arrangers.

(c) The Borrower agrees to pay to the Administrative Agent the fees in the amounts and on the dates from time to time agreed to inwriting by the Borrower and the Administrative Agent.

2.10 Termination or Reduction of Commitments. (a) The Borrower shall have the right, upon not less than three Business Days' noticeto the Administrative Agent, to terminate the Revolving Credit Commitments or, from time to time, to reduce the aggregate amount of theRevolving Credit Commitments; provided that no such termination or reduction of Revolving Credit Commitments shall be permitted if, aftergiving effect thereto and to any prepayments of the Revolving Credit Loans and Swing Line Loans made on the effective date thereof, theTotal Revolving Extensions of Credit would exceed the Total Revolving Credit Commitments. Any such reduction shall be in an amountequal to $5,000,000, or an integral multiple of $1,000,000 in excess thereof, and shall reduce permanently the Revolving Credit Commitmentsthen in effect. The Commitments with respect to the Tranche A Term Loans shall be reduced to zero upon the funding of the Tranche A TermLoans on the Closing Date.

2.11 Optional Prepayments. (a) The Borrower may at any time and from time to time prepay the Loans, in whole or in part, withoutpremium or penalty, upon irrevocable notice delivered to the Administrative Agent no later than 12:00 Noon New York City time on the thirdBusiness Day prior thereto in the case of LIBO Rate Loans no later than 10:00 A.M. New York City time, on such day, in the case of BaseRate Loans, which notice shall (i) designate whether the Borrower is prepaying Swing Line Loans, Revolving Credit Loans and/or Tranche ATerm Loans and (ii) specify the date and amount of such prepayment, and whether the prepayment is of LIBO Rate Loans or Base Rate Loansand the Applicable Currency thereof; provided, that (i) if a LIBO Rate Loan is prepaid on any day other than the last day of the Interest Periodapplicable thereto, the Borrower shall also pay any amounts owing pursuant to Section 2.21 and (ii) no prior notice is required for theprepayment of Swing Line Loans. Upon receipt of any such notice the Administrative Agent shall promptly notify each relevant Lenderthereof. If any such notice is given, the amount specified in such notice shall be due and payable on the date specified therein, together with(except in the case of Loans (unless all Revolving Credit Loans are being repaid and the Revolving Credit Commitments terminated) that areBase Rate Loans and Swing Line Loans) accrued interest to such date on the amount prepaid. Partial prepayments of Tranche A Term Loansand Revolving Credit Loans shall be in an aggregate principal amount of amount equal to (i) if the Applicable Currency is Dollars,$5,000,000, or an integral multiple of $1,000,000 in excess thereof or (ii) if a Revolving Euro Loan, €5,000,000, or an integral multiple of€1,000,000 thereof. Partial prepayments of Swing Line Loans shall be in an aggregate principal amount of $500,000 or an integral multiple of$100,000 in excess thereof. Notwithstanding anything in Section 2.10 or 2.11 to the contrary, a notice of prepayment or termination orreduction of Revolving Credit Commitments may state that such notice is conditioned upon effectiveness of other financing, in which casesuch notice may be revoked by notice to the Administrative Agent on or prior to the specified effective date if such condition is not satisfied.

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2.12 Mandatory Prepayments. (a) If any Indebtedness shall be incurred by Holdings, the Borrower or any of its Subsidiaries (excludingany Indebtedness incurred in accordance with clauses (a) through (m) or clauses (q), (r) or (s) of Section 7.2), then not later than five BusinessDays after the date of such incurrence, an amount equal to 100% of the Net Cash Proceeds thereof shall be applied on the date of suchincurrence toward the prepayment of the Tranche A Term Loans as set forth in Section 2.12(d). The provisions of this Section do notconstitute a consent to the incurrence of any Indebtedness by Holdings, the Borrower or any of its Subsidiaries not permitted by Section 7.2.

(b) If on any date Holdings, the Borrower or any of its Subsidiaries shall receive Net Cash Proceeds from any Asset Sale or RecoveryEvent, then, unless a Reinvestment Notice shall be delivered in respect thereof, within five Business Days of the date of receipt by Holdings,the Borrower or such Subsidiary of such Net Cash Proceeds, such Net Cash Proceeds shall be applied toward the prepayment of the Tranche ATerm Loans as set forth in Section 2.12(d); provided, that, notwithstanding the foregoing, (i) no prepayment shall be required by thisparagraph (b) in respect of any Asset Sale or Recovery Event that generates Net Cash Proceeds of less than or equal to $5,000,000, and (ii) oneach Reinvestment Prepayment Date an amount equal to the Reinvestment Prepayment Amount with respect to the relevant ReinvestmentEvent shall be applied on such date toward the prepayment of the Tranche A Term Loans as set forth in Section 2.12(d). The provisions of thisSection do not constitute a consent to the consummation of any Disposition not permitted by Section 7.5.

(c) If, for any fiscal year of the Borrower commencing with the fiscal year ending December 31, 2006, there shall be Excess Cash Flow,then, on the relevant Excess Cash Flow Application Date, the Tranche A Term Loans shall be prepaid in an amount equal to the ECFPercentage of such Excess Cash Flow, as set forth in Section 2.12(d). Each such prepayment shall be made on a date (an "Excess Cash FlowApplication Date") no later than five Business Days after the earlier of (i) the date on which the financial statements of the Borrower referredto in Section 6.1(a), for the fiscal year with respect to which such prepayment is made, are required to be delivered to the Lenders and (ii) thedate such financial statements are actually delivered.

(d) Amounts to be applied pursuant to Section 2.12 (a), (b), (c), (f) and (g) shall be applied to the prepayment of the Tranche A TermLoans. The application of any prepayment pursuant to Section 2.11 or this Section 2.12 shall be made, first, to Base Rate Loans and, second,to LIBO Rate Loans, in each case in a manner which, in the Administrative Agent's reasonable judgment, following consultation with theBorrower, (which shall be conclusive) minimizes the amount of any payments required to be made by the Borrower pursuant to Section 2.21.Each prepayment of the Loans under Section 2.11 and this Section 2.12 (except in the case of Revolving Credit Loans (unless the RevolvingCredit Loans are being repaid in full and the Revolving Credit Commitments terminated) that are Base Rate Loans and Swing Line Loans)shall be accompanied by accrued interest to the date of such prepayment to the applicable Lender on the amount prepaid.

(e) If on any Valuation Date the Administrative Agent shall determine and notify the Borrower that the aggregate Revolving Extensionsof Credit on such Valuation Date exceed 105% of the excess of (i) the Total Revolving Credit Commitments on such Valuation Date over(ii) the Receivables Reserve Amount on such Valuation Date (such notice to provide the euro/Dollar exchange rate used in such calculation,which shall be the Dollar Equivalent Exchange Rate on such Valuation Date), then the Borrower shall, on the third Business Day (such day,the "Payment Date") following receipt by it of such notice from the Administrative Agent, provide cash collateral for the Letters of Credit inthe manner set forth in Section 8 and/or prepay Swingline Loans or Revolving Credit Loans, in such combination and amounts as theBorrower may determine in its sole discretion, to the extent necessary to ensure that, after giving effect to any borrowings or prepayments tobe made by the Borrower on or prior to such Payment Date, the aggregate Revolving Extensions of Credit (measured using the DollarEquivalent Exchange Rate specified in such notice) outstanding on such Payment Date do not exceed the excess of (i) Total Revolving CreditCommitments on such Payment Date over (ii) the Receivables Reserve Amount on such Payment Date. If,

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on any date subsequent to such Payment Date, the Administrative Agent reasonably determines that any cash collateral for Letters of Creditprovided pursuant to this Section 2.12(e) is no longer required, the Administrative Agent shall promptly return such cash collateral to theBorrower.

(f) If Holdings, the Borrower or any of its Subsidiaries shall receive any Henderson Sale Proceeds, then not later than five BusinessDays after the date of receipt of such Henderson Sale Proceeds by such Person, an amount equal to 100% of such Henderson Sale Proceedsshall be applied toward the prepayment of the Tranche A Term Loans as set forth in Section 2.12(d).

(g) If on any date Holdings, the Borrower or any of its Subsidiaries shall receive Net Cash Proceeds from any Receivable QualifyingAsset Sale, then, within five Business Days of the date of receipt by Holdings, the Borrower or such Subsidiary of such Net Cash Proceeds,50% of such Net Cash Proceeds shall be applied toward the prepayment of the Tranche A Term Loans as set forth in Section 2.12(d). Theprovisions of this Section do not constitute a consent to the consummation of any Disposition not permitted by Section 7.5.

2.13 Conversion and Continuation Options. (a) The Borrower may elect from time to time to convert LIBO Rate Dollar Loans to BaseRate Loans by giving the Administrative Agent prior irrevocable notice of such election no later than 12:00 noon, New York City time, on theproposed conversion date, provided that any such conversion of LIBO Rate Loans may be made only on the last day of an Interest Period withrespect thereto. The Borrower may elect (subject to Sections 2.17 and 2.22) from time to time to convert Base Rate Loans to LIBO RateDollar Loans by giving the Administrative Agent prior irrevocable notice any of such election (which notice shall specify the length of theinitial Interest Period therefor) no later than 12:00 noon New York City time, on the third Business Day prior to the proposed conversion date,provided that no Base Rate Loan under a particular Facility may be converted into a LIBO Rate Dollar Loan (i) when any Event of Default hasoccurred and is continuing and the Administrative Agent has, or the Majority Facility Lenders in respect of such Facility have, determined inits or their sole discretion not to permit such conversion or (ii) after the date that is one month prior to the final scheduled termination ormaturity date of such Facility. Upon receipt of any such notice the Administrative Agent shall promptly notify each relevant Lender thereof.

(b) The Borrower may elect (subject to Sections 2.17 and 2.22) to continue any LIBO Rate Loan as such upon the expiration of the thencurrent Interest Period with respect thereto for an additional Interest Period in the same Applicable Currency by giving irrevocable notice tothe Administrative Agent, in accordance with the applicable provisions of the term "Interest Period" set forth in Section 1.1, of the length ofthe next Interest Period to be applicable to such Loans; provided that no LIBO Rate Loan under a particular Facility may be continued as such(i) for any Interest Period of any length (in the case of LIBO Rate Dollar Loans) or any Interest Period in excess of one month (in the case ofRevolving Credit Euro Loans) when any Event of Default has occurred and is continuing and the Administrative Agent has, or the MajorityFacility Lenders in respect of such Facility have, determined in its or their sole discretion not to permit such continuation or (ii) after the datethat is one month prior to the final scheduled termination or maturity date of such Facility; and provided, further, that if the Borrower shall failto give any required notice as described above in this paragraph or if such continuation is not permitted pursuant to the preceding proviso, anysuch Loans (other than Revolving Credit Euro Loans) shall be converted automatically to Base Rate Loans and Revolving Credit Euro Loansshall, if otherwise permitted under this Agreement, be continued as Revolving Credit Euro Loans with an Interest Period of one month, in eachcase on the last day of such then expiring Interest Period. Upon receipt of any such notice the Administrative Agent shall promptly notify eachrelevant Lender thereof.

(c) Revolving Credit Euro Loans may not be converted into Revolving Credit Dollar Loans.

2.14 Minimum Amounts and Maximum Number of LIBO Rate Tranches. Notwithstanding anything to the contrary in this Agreement,all borrowings, conversions, continuations and optional prepayments of LIBO Rate Loans and all selections of Interest Periods shall be in suchamounts and be made pursuant to

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such elections so that, (a) after giving effect thereto, the aggregate principal amount of the LIBO Rate Loans comprising each LIBO RateTranche (x) if the Applicable Currency is Dollars, shall be equal to $1,000,000 or a whole multiple of $1,000,000 in excess thereof, and (y) ifa Revolving Euro Loan, shall be equal to €1,000,000, or an integral multiple of €1,000,000 thereof and (b) no more than twelve LIBO RateTranches shall be outstanding at any one time.

2.15 Interest Rates and Payment Dates. (a) Each LIBO Rate Loan shall bear interest for each day during each Interest Period withrespect thereto at a rate per annum equal to the LIBO Rate determined for such day plus the Applicable Margin in effect for such day.

(b) Each Base Rate Loan shall bear interest for each day on which it is outstanding at a rate per annum equal to the Base Rate in effectfor such day plus the Applicable Margin in effect for such day.

(c) (i) If all or a portion of the principal amount of any Loan or Reimbursement Obligation shall not be paid when due (whether at thestated maturity, by acceleration or otherwise), such overdue amount (to the extent legally permitted) shall bear interest at a rate per annum thatis equal to (x) in the case of the LIBO Rate Loans, a rate per annum equal to the LIBO Rate determined for such day plus the highestApplicable Margin for LIBO Rate Loans plus 2.0%, (y) in the case of the Base Rate Loans, a rate per annum equal to the Base Ratedetermined for such day plus the highest Applicable Margin for Base Rate Loans plus 2.0%, or (z) in the case of Reimbursement Obligations,the rate applicable to Base Rate Loans under the Revolving Credit Facility calculated at the highest Applicable Margin for such Loans plus2.0%, and (ii) if all or a portion of any interest payable on any Loan or Reimbursement Obligation or any commitment fee or other amountpayable hereunder shall not be paid when due (whether at the stated maturity, by acceleration or otherwise), such overdue amount shall bearinterest at a rate per annum equal to the rate then applicable to Base Rate Loans under the relevant Facility calculated at the highest ApplicableMargin for such Loans plus 2.0% (or, in the case of any such other amounts that do not relate to a particular Facility, the rate then applicableto Base Rate Loans under the Revolving Credit Facility calculated at the highest Applicable Margin for such Loans plus 2.0%), in each case,with respect to clauses (i) and (ii) above, from the date of such non payment until such amount is paid in full (after as well as beforejudgment).

(d) Interest shall be payable in arrears on each Interest Payment Date, provided that interest accruing pursuant to paragraph (c) of thisSection shall be payable from time to time on demand.

(e) Interest on any Loan or other Obligation shall be payable in same currency as the currency in which such Loan or other Obligation ispayable.

2.16 Computation of Interest and Fees. (a) Interest, fees and commissions payable pursuant hereto shall be calculated on the basis of a360-day year for the actual days elapsed, except that, with respect to Base Rate Loans on which interest is calculated on the basis of the PrimeRate, the interest thereon shall be calculated on the basis of a 365- (or 366-, as the case may be) day year for the actual days elapsed. TheAdministrative Agent shall as soon as practicable notify the Borrower and the relevant Lenders of each determination of a LIBO Rate. Anychange in the interest rate on a Loan resulting from a change in the Base Rate or the LIBOR Statutory Reserves shall become effective as ofthe opening of business on the day on which such change becomes effective. The Administrative Agent shall as soon as practicable notify theBorrower and the relevant Lenders of the effective date and the amount of each such change in interest rate.

(b) Each determination of an interest rate by the Administrative Agent pursuant to any provision of this Agreement shall be conclusiveand binding on the Borrower and the Lenders in the absence of manifest error. The Administrative Agent shall, at the request of the Borrower,deliver to the Borrower a statement showing the quotations used by the Administrative Agent in determining any interest rate pursuant toSection 2.16(a).

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2.17 Inability to Determine Interest Rate. If prior to the first day of any Interest Period:

(a) the Administrative Agent shall have determined (which determination shall be conclusive and binding upon the Borrower) that, byreason of circumstances affecting the relevant market, adequate and reasonable means do not exist for ascertaining the LIBO Rate for suchInterest Period, or

(b) the Administrative Agent shall have received notice from the Majority Facility Lenders in respect of the relevant Facility that theLIBO Rate determined or to be determined for such Interest Period will not adequately and fairly reflect the cost to such Lenders (asconclusively certified by such Lenders) of making or maintaining their affected Loans during such Interest Period,

the Administrative Agent shall give telecopy or telephonic notice thereof to the Borrower and the relevant Lenders as soon as practicablethereafter. If such notice is given: (i) if the affected Loans are LIBO Rate Dollar Loans, (w) any LIBO Rate Dollar Loans under the relevantFacility requested to be made on the first day of such Interest Period shall be made as Base Rate Loans, (x) any Base Rate Loans under therelevant Facility that were to have been converted on the first day of such Interest Period to LIBO Rate Dollar Loans shall be continued asBase Rate Loans, (y) any outstanding LIBO Rate Dollar Loans under the relevant Facility shall be converted, on the last day of the thencurrent Interest Period with respect thereto, to Base Rate Loans and (z) the obligations of the Lenders to make or continue LIBO Rate DollarLoans or to convert Base Rate Loans into LIBO Rate Dollar Loans shall be suspended until such notice has been withdrawn by theAdministrative Agent; and (ii) if the affected Loans are Revolving Credit Euro Loans, (x) Revolving Credit Euro Loans will automatically, onthe last day of the current Interest Period for such Loan, become due and payable and (y) the obligations of the Lenders to make or continueRevolving Euro Credit Loans shall be suspended until such notice has been withdrawn by the Administrative Agent.

2.18 Pro Rata Treatment and Payments. (a) Each borrowing by the Borrower from the Lenders hereunder, each payment by theBorrower on account of any commitment fee, and any reduction of the Commitments of the Lenders, shall be made pro rata according to therespective Tranche A Term Loan Percentages or Revolving Credit Percentages, as the case may be, of the relevant Lenders. Subject toSection 2.18(c), each payment (other than prepayments as set forth in Sections 2.18(b) or (c)) in respect of principal or interest in respect ofthe Tranche A Term Loans and each payment in respect of fees or expenses payable hereunder shall be applied to the amounts of suchobligations owing to the Lenders pro rata according to the respective amounts then due and owing to the Lenders. The application of anyprepayment pursuant to this Section 2.18 shall be made, first, to Base Rate Loans and, second, to LIBO Rate Loans.

(b) Each payment (including each prepayment) of the Tranche A Term Loans outstanding under the Tranche A Term Loan Facility shallbe allocated among the Tranche A Term Loan Lenders holding such Tranche A Term Loans pro rata based on the principal amount of suchTranche A Term Loans held by such Tranche A Term Loan Lenders, and shall be applied to reduce the then remaining installments of suchTranche A Term Loans pro rata based upon the then remaining installments thereof. Amounts prepaid on account of the Tranche A TermLoans may not be reborrowed.

(c) Each payment (including each prepayment) by the Borrower on account of principal of and interest on the Revolving Credit Loansshall be made pro rata according to the respective outstanding principal amounts of the Revolving Credit Loans then held by the RevolvingCredit Lenders. Each payment in respect of Reimbursement Obligations in respect of any Letter of Credit shall be made to the Issuing Lenderthat issued such Letters of Credit.

(d) The application of any payment of Loans under any Facility (including optional and mandatory prepayments) shall be made, first, toBase Rate Loans under such Facility and, second, to LIBO Rate Loans under such Facility. Each payment of the Loans (except in the case ofSwing Line Loans and

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Revolving Credit Loans that are Base Rate Loans) shall be accompanied by accrued interest to the date of such payment on the amount paid.

(e) All payments (including prepayments) to be made by the Borrower hereunder, whether on account of principal, interest, fees orotherwise, shall be made without setoff or counterclaim and shall be made prior to 1:00 p.m., New York City time, on the due date thereof tothe Administrative Agent, for the account of the relevant Lenders, at the Payment Office, in the Applicable Currency and in immediatelyavailable funds. The Administrative Agent shall distribute such payments to the Lenders promptly upon receipt in like funds as received. Ifany payment hereunder (other than payments on the LIBO Rate Loans) becomes due and payable on a day other than a Business Day, suchpayment shall be extended to the next succeeding Business Day. If any payment on a LIBO Rate Loan becomes due and payable on a dayother than a Business Day, the maturity thereof shall be extended to the next succeeding Business Day unless the result of such extensionwould be to extend such payment into another calendar month, in which event such payment shall be made on the immediately precedingBusiness Day. In the case of any extension of any payment of principal pursuant to the preceding two sentences, interest thereon shall bepayable at the then applicable rate during such extension.

(f) Unless the Administrative Agent shall have been notified in writing by any Lender prior to a borrowing that such Lender will notmake the amount that would constitute its share of such borrowing available to the Administrative Agent, the Administrative Agent mayassume that such Lender is making such amount available to the Administrative Agent, and the Administrative Agent may, in reliance uponsuch assumption, make available to the Borrower a corresponding amount. If such amount is not made available to the Administrative Agentby the required time on the Borrowing Date therefor, such Lender shall pay to the Administrative Agent, on demand, such amount withinterest thereon at a rate equal to the daily average Federal Funds Effective Rate for the period until such Lender makes such amountimmediately available to the Administrative Agent. A certificate of the Administrative Agent submitted to any Lender with respect to anyamounts owing under this paragraph shall be conclusive in the absence of manifest error. If such Lender's share of such borrowing is not madeavailable to the Administrative Agent by such Lender within three Business Days after such Borrowing Date, the Administrative Agent shallalso be entitled to recover such amount with interest thereon at the rate per annum applicable to Base Rate Loans under the relevant Facility,on demand, from the Borrower.

(g) Unless the Administrative Agent shall have been notified in writing by the Borrower prior to the date of any payment being made bythe Borrower hereunder that the Borrower will not make such payment to the Administrative Agent, the Administrative Agent may assumethat the Borrower is making such payment, and the Administrative Agent may, but shall not be required to, in reliance upon such assumption,make available to the Lenders their respective pro rata shares of a corresponding amount. If such payment is not made to the AdministrativeAgent by the Borrower within three Business Days of such required date, the Administrative Agent shall be entitled to recover, on demand,from each Lender to which any amount which was made available pursuant to the preceding sentence, such amount with interest thereon at therate per annum equal to the daily average Federal Funds Effective Rate. Nothing herein shall be deemed to limit the rights of theAdministrative Agent or any Lender against the Borrower.

(h) The Administrative Agent reserves the right to apply against the repayment of any Obligations owing in any currency, anyrepayment and other amounts that may be applied in accordance with other provisions of this Agreement to repay such Obligations, regardlessof the currency in which such repayments and amounts were received or are held.

2.19 Requirements of Law. (a) If the adoption of or any change in any Requirement of Law or in the interpretation or applicationthereof or compliance by any Lender with any request or directive (whether

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or not having the force of law) from any central bank or other Governmental Authority made subsequent to the date hereof:

(i) shall impose, modify or hold applicable any reserve, special deposit, compulsory loan or similar requirement against assetsheld by, deposits or other liabilities in or for the account of, advances, loans or other extensions of credit by, or any other acquisitionof funds by, any office of such Lender that is not otherwise included in the determination of the LIBO Rate hereunder; or

(ii) shall impose on such Lender any other condition;

and the result of any of the foregoing is to increase the cost to such Lender, by an amount which such Lender deems to be material, of making,converting into, continuing or maintaining LIBO Rate Dollar or Revolving Credit Euro Loans or issuing or participating in Letters of Credit,or to reduce any amount receivable by such Lender hereunder in respect thereof, then, in any such case, the Borrower shall promptly pay suchLender, upon its written demand (which shall include the certificate described in Section 2.19(c)), any additional amounts necessary tocompensate such Lender on an after-tax basis for such increased cost or reduced amount receivable. If any Lender becomes entitled to claimany additional amounts pursuant to this Section, it shall promptly notify the Borrower (with a copy to the Administrative Agent) of the eventby reason of which it has become so entitled.

(b) If any Lender shall have determined that the adoption of or any change in any Requirement of Law regarding capital adequacy or inthe interpretation or application thereof or compliance by such Lender or any corporation controlling such Lender with any request ordirective regarding capital adequacy (whether or not having the force of law) from any Governmental Authority made subsequent to the datehereof shall have the effect of reducing the rate of return on such Lender's or such corporation's capital as a consequence of its obligationshereunder or under or in respect of any Letter of Credit to a level below that which such Lender or such corporation could have achieved butfor such adoption, change or compliance (taking into consideration such Lender's or such corporation's policies with respect to capitaladequacy) by an amount deemed by such Lender to be material, then from time to time, after submission by such Lender to the Borrower(with a copy to the Administrative Agent) of a written request therefor (which request shall include the certificate described inSection 2.19(c)), the Borrower shall pay to such Lender within 15 days of receipt of such notice such additional amount or amounts as willcompensate such Lender on an after-tax basis for such reduction.

(c) A certificate as to any additional amounts payable pursuant to this Section submitted by any Lender to the Borrower (with a copy tothe Administrative Agent) with reasonable detail demonstrating how such amounts were derived shall be conclusive in the absence of manifesterror. The obligations of the Borrower pursuant to this Section shall survive the termination of this Agreement and the payment of the Loansand all other amounts payable hereunder.

2.20 Taxes. (a) All payments made by the Borrower under this Agreement or any other Loan Documents shall be made free and clearof, and without deduction or withholding for or on account of, any present or future income, stamp or other taxes, levies, imposts, duties,charges, fees, deductions or withholdings, now or hereafter imposed, levied, collected, withheld or assessed by any Governmental Authority,excluding net income taxes and franchise taxes (imposed in lieu of net income taxes) imposed on the Arrangers, any Agent or any Lender as aresult of a present or former connection between the Arrangers, such Agent or such Lender and the jurisdiction of the Governmental Authorityimposing such tax or any political subdivision or taxing authority thereof or therein (other than any such connection arising solely from theArrangers', such Agent's or such Lender's having executed, delivered or performed its obligations or received a payment under, or enforced,this Agreement or any other Loan Document). If any such non-excluded taxes, levies, imposts, duties, charges, fees, deductions orwithholdings ("Non-Excluded Taxes") or any Other Taxes are required to be withheld from any amounts payable to the Arrangers, any Agentor any Lender hereunder, the amounts so payable to the Arrangers, such Agent or such Lender shall be increased to the extent necessary toyield to the Arrangers, such Agent or such

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Lender (after payment of all Non-Excluded Taxes and Other Taxes) interest or any such other amounts payable hereunder at the rates or in theamounts specified in this Agreement; provided, however, that the Borrower or any Guarantor shall not be required to increase any suchamounts payable to the Arrangers, any Agent or any Lender with respect to any Non-Excluded Taxes (i) that are attributable to the Arrangers',such Agent's or such Lender's failure to comply with the requirements of paragraph (d) or (e) of this Section or (ii) in the case of any Non-U.S.Lender, that are United States withholding taxes imposed on amounts payable to the Arrangers, such Agent or such Lender at the time theArrangers, such Agent or such Lender becomes a party to this Agreement, except to the extent that the Arrangers', such Agent's or suchLender's assignor (if any) was entitled, at the time of assignment, to receive additional amounts from the Borrower with respect to such Non-Excluded Taxes pursuant to this paragraph (a). The Borrower or the applicable Guarantor shall make any required withholding and pay thefull amount withheld to the relevant tax authority or other Governmental Authority in accordance with applicable Requirements of Law.

(b) In addition, the Borrower shall pay any Other Taxes to the relevant Governmental Authority in accordance with applicable law.

(c) Whenever any Non-Excluded Taxes or Other Taxes are payable by the Borrower, as promptly as possible thereafter the Borrowershall send to the Administrative Agent for the account of the relevant Arranger, Agent or Lender, as the case may be, a certified copy of anoriginal official receipt received by the Borrower showing payment thereof. If the Borrower fails to pay any Non-Excluded Taxes or OtherTaxes when due to the appropriate taxing authority or fails to remit to the Administrative Agent the required receipts or other requireddocumentary evidence, the Borrower shall indemnify the Arrangers, the Agents and the Lenders for any incremental taxes, interest orpenalties that may become payable by the Arrangers, any Agent or any Lender as a result of any such failure. The agreements in this Sectionshall survive the termination of this Agreement and the payment of the Loans and all other amounts payable hereunder.

(d) Each Lender (or Transferee) that is not a citizen or resident of the United States of America, a corporation, partnership or otherentity created or organized in or under the laws of the United States of America (or any jurisdiction thereof), or any estate or trust that issubject to federal income taxation regardless of the source of its income (a "Non U.S. Lender") shall deliver to the Borrower and theAdministrative Agent (or, in the case of a Participant, to the Lender from which the related participation shall have been purchased) twocopies of either U.S. Internal Revenue Service Form W-8BEN or Form W-8ECI (or successor form), or, in the case of a Non U.S. Lenderclaiming exemption from U.S. federal withholding tax under Section 871(h) or 881(c) of the Code with respect to payments of "portfoliointerest" a statement substantially in the form of Exhibit G to the effect that such Lender is eligible for a complete exemption fromwithholding of U.S. taxes under Section 871(h) or 881(c) of the Code and a Form W-8BEN, or any subsequent versions thereof or successorsthereto properly completed and duly executed by such Non U.S. Lender claiming complete exemption from, or a reduced rate of, U.S. federalwithholding tax on all payments by the Borrower under this Agreement and the other Loan Documents. Such forms shall be delivered by eachNon-U.S. Lender on or before the date it becomes a party to this Agreement (and in the case of any Participant, on or before the date suchParticipant purchases the related participation). In addition, each Non-U.S. Lender shall deliver such forms promptly upon the obsolescence orinvalidity of any form previously delivered by such Non-U.S. Lender. Each Non-U.S. Lender shall promptly notify the Borrower at any time itdetermines that it is no longer in a position to provide any previously delivered certificate to the Borrower (or any other form of certificationadopted by the U.S. taxing authorities for such purpose). Notwithstanding any other provision of this paragraph, a Non-U.S. Lender shall notbe required to deliver any form pursuant to this paragraph that such Non-U.S. Lender is not legally able to deliver.

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(e) A Lender that is entitled to an exemption from or reduction of non-U.S. withholding tax under the law of the jurisdiction in whichthe Borrower is located, or any treaty to which such jurisdiction is a party, with respect to payments under this Agreement shall deliver to theBorrower (with a copy to the Administrative Agent), at the time or times prescribed by applicable law or reasonably requested by theBorrower, such properly completed and executed documentation prescribed by applicable law as will permit such payments to be madewithout withholding or at a reduced rate, provided that such Lender is legally entitled to complete, execute and deliver such documentationand in such Lender's reasonable judgment such completion, execution or submission would not materially prejudice the legal position of suchLender.

2.21 Indemnity. The Borrower agrees to indemnify each Lender for, and to hold each Lender harmless from, any loss or expense thatsuch Lender may sustain or incur as a consequence of (a) default by the Borrower in making a borrowing of, conversion into or continuationof LIBO Rate Loans after the Borrower has given a notice requesting the same in accordance with the provisions of this Agreement,(b) default by the Borrower in making any prepayment of LIBO Rate Loans after the Borrower has given a notice thereof in accordance withthe provisions of this Agreement or (c) the making of a prepayment or conversion of LIBO Rate Loans on a day that is not the last day of anInterest Period with respect thereto. Such indemnification may include an amount equal to the excess, if any, of (i) the amount of interest thatwould have accrued on the amount so prepaid, or not so borrowed, converted or continued, for the period from the date of such prepayment orof such failure to borrow, convert or continue to the last day of such Interest Period (or, in the case of a failure to borrow, convert or continue,the Interest Period that would have commenced on the date of such failure) in each case at the applicable rate of interest for such Loansprovided for herein (excluding, however, the Applicable Margin included therein, if any) over (ii) the amount of interest (as reasonablydetermined by such Lender) that would have accrued to such Lender on such amount by placing such amount on deposit for a comparableperiod with leading banks in the interbank eurodollar market. A certificate as to any amounts payable pursuant to this Section, with reasonabledetail demonstrating how such amounts were derived, submitted to the Borrower by any Lender shall be conclusive in the absence of manifesterror. This covenant shall survive the termination of this Agreement and the payment of the Loans and all other amounts payable hereunder.

2.22 Illegality. Notwithstanding any other provision herein, if the adoption of or any change in any Requirement of Law or in theinterpretation or application thereof shall make it unlawful for any Lender to make or maintain LIBO Rate Dollar Loans or Revolving CreditEuro Loans as contemplated by this Agreement, (a) if the affected Loans are LIBO Rate Dollar Loans, (x) the commitment of such Lenderhereunder to make LIBO Rate Dollar Loans, continue LIBO Rate Dollar Loans as such and convert Base Rate Loans to LIBO Rate DollarLoans shall forthwith be canceled, and such Lender shall make a Base Rate Loan as part of any requested Borrowing of LIBO Rate DollarLoans, and (y) such Lender's Loans then outstanding as LIBO Rate Dollar Loans, if any, shall be converted automatically to Base Rate Loanson the respective last days of the then current Interest Periods with respect to such Loans or within such earlier period as required by law; or(b) if the affected Loans are Revolving Credit Euro Loans, (x) the commitment of such Lender hereunder to make Revolving Credit EuroLoans or continue Revolving Credit Euro Loans as such shall forthwith be canceled and such Lender shall make a Revolving Credit Base RateLoan as part of any requested borrowing of Revolving Credit Euro Loans and (y) if Revolving Credit Euro Loans are then outstanding, theBorrower shall repay each such Loan on the respective last days of the then current Interest Periods with respect to such Loans or within suchearlier period as required by law. If any such conversion of a LIBO Rate Dollar Loan or repayment of a Revolving Credit Euro Loan occurson a day which is not the last day of the then current Interest Period with respect thereto, the Borrower shall pay to such Lender such amounts,if any, as may be required pursuant to Section 2.21.

2.23 Change of Lending Office. Each Lender agrees that, upon the occurrence of any event giving rise to the operation ofSection 2.19, 2.20(a) or 2.22 with respect to such Lender, it will, if requested by the

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Borrower, use reasonable efforts (subject to overall policy considerations of such Lender) to file any certificate or document reasonablyrequested by the Borrower or to designate another lending office for any Loans affected by such event, in each case, with the object ofavoiding the consequences of such event; provided, that such designation is made on terms that, in the sole judgment of such Lender, causesuch Lender and its lending office(s) to suffer no economic, legal or regulatory disadvantage, and provided, further, that nothing in thisSection shall affect or postpone any of the obligations of any Borrower or the rights of any Lender pursuant to Section 2.19, 2.20(a) or 2.22.

2.24 Replacement of Lenders under Certain Circumstances. The Borrower shall be permitted to replace any Lender that (w) requestsreimbursement for amounts owing pursuant to Section 2.19 or 2.20(a) or has invoked Section 2.22, (x) is in default of its obligation to makeLoans hereunder (a "Defaulting Lender"), (y) becomes insolvent and its assets become subject to a receiver, liquidator, trustee, custodian orother Person having similar powers or (z) becomes a "Non-Consenting Lender" (as defined below), with a replacement financial institution;provided that (i) such replacement does not conflict with any Requirement of Law, (ii) no Event of Default shall have occurred and becontinuing at the time of such replacement, (iii) in the event of a replacement of a Non-Consenting Lender, in order for the Borrower to beentitled to replace such a Lender, such replacement must take place no later than 180 days after the date the Non-Consenting Lender shallhave notified the Borrower and the Administrative Agent of its failure to agree to any requested consent, waiver or amendment, (iv) in theevent of a replacement of a Lender that requested reimbursement pursuant to Section 2.19 or 2.20(a) or that invoked Section 2.22, prior to anysuch replacement, such Lender shall have taken no action under Section 2.23 so as to eliminate the continued need for payment of amountsowing pursuant to Section 2.19 or 2.20(a) or the effect of Section 2.22, (v) the replacement financial institution shall purchase, at par, allLoans and other amounts owing to such replaced Lender on or prior to the date of replacement, (vi) the Borrower shall be liable to suchreplaced Lender under Section 2.21 (as though Section 2.21 were applicable) if any LIBO Rate Loan owing to such replaced Lender shall bepurchased other than on the last day of the Interest Period relating thereto, (vii) the replacement financial institution, if not already a Lender,shall be reasonably satisfactory to the Administrative Agent, (viii) the replaced Lender shall be obligated to make such replacement inaccordance with the provisions of Section 10.6 (provided that the Borrower shall be obligated to pay the registration and processing feereferred to therein), (ix) until such time as such replacement shall be consummated the Borrower shall pay all additional amounts (if any)required pursuant to Section 2.19 or 2.20(a), as the case may be, and (x) any such replacement shall not be deemed to be a waiver of any rightsthat the Borrower, the Administrative Agent or any other Lender shall have against the replaced Lender.

In the event that (A) the Borrower or the Administrative Agent has requested the Lenders to consent to a departure or waiver of anyprovisions of the Loan Documents or to agree to any amendment thereto, (B) the consent, waiver or amendment in question requires theagreement of all Lenders in accordance with the terms of Section 10.1 or all the Lenders with respect to a certain class of the Loans and(C) Required Lenders or more than 50% of the class of such Lenders have agreed to such consent, waiver or amendment, then any Lenderwho does not agree to such consent, waiver or amendment shall be deemed a "Non-Consenting Lender". The Borrower's right to replace aDefaulting Lender pursuant to this Section 2.24 is, and shall be, in addition to, and not in lieu of, all other rights and remedies available to theBorrower against such Defaulting Lender under this Agreement, at law, in equity, or by statute.

2.25 Limitation on Additional Amounts, etc. Notwithstanding anything to the contrary contained in Sections 2.19, 2.20 or 2.22 of thisAgreement, unless the Administrative Agent or a Lender gives notice to the Borrower that it is obligated to pay an amount under any suchSection within 90 days after the later of (x) the date the Lender incurs the respective increased costs, Non-Excluded Taxes, Other Taxes, loss,expense or liability, reduction in amounts received or receivable or reduction in return on capital or (y) the date such Lender has actualknowledge of its incurrence of the respective increased costs, Non-Excluded Taxes, Other Taxes, loss, expense or liability, reductions inamounts received or receivable or reduction in

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return on capital, such Lender shall not be entitled to be compensated for interest and penalties by the Borrower pursuant to Sections 2.19,2.20, or 2.22, as the case may be, to the extent such interest or penalties are incurred or suffered on or after such date. This Section 2.25 shallhave no applicability to any Section of this Agreement other than Sections 2.19, 2.20 or 2.22.

SECTION 3. LETTERS OF CREDIT

3.1 L/C Commitment. (a) Prior to the Closing Date, the Existing Issuing Lender has issued the Existing Letters of Credit which, fromand after the Closing Date, shall constitute Letters of Credit hereunder. Subject to the terms and conditions hereof, each Issuing Lender, inreliance on the agreements of the other Revolving Credit Lenders set forth in Section 3.4(a), agrees to issue letters of credit (the letters ofcredit issued on and after the Closing Date pursuant to this Section 3, together with the Existing Letters of Credit, collectively, the "Letters ofCredit") for the account of the Borrower on any Business Day during the Revolving Credit Commitment Period in such form as may beapproved from time to time by such Issuing Lender; provided, that no Issuing Lender shall have any obligation to issue any Letter of Credit if,after giving effect to such issuance, the aggregate amount of the Available Revolving Credit Commitments at such time would be less thanzero. Each Letter of Credit shall (i) be denominated in Dollars or in euro and (ii) except as otherwise provided in Annex B with respect tocertain Existing Letters of Credit, expire no later than the earlier of (x) the first anniversary of its date of issuance and (y) the date which isfive Business Days prior to the Scheduled Revolving Credit Termination Date; provided that (i) any Letter of Credit with a one-year term mayprovide for the renewal thereof for additional one-year periods (which shall in no event extend beyond the date referred to in clause (y)above), and (ii) no Issuing Lender shall be under any obligation to issue a Letter of Credit (Euro) if the obligation of any Lender to makeRevolving Credit Euro Loans is suspended at such time pursuant to Section 2.17 or Section 2.22.

(b) No Issuing Lender shall at any time be obligated to issue any Letter of Credit hereunder if such issuance would conflict with, orcause such Issuing Lender or any L/C Participant to exceed any limits imposed by, any applicable Requirement of Law.

3.2 Procedure for Issuance of Letter of Credit. The Borrower may from time to time request that an Issuing Lender issue a Letter ofCredit by delivering to such Issuing Lender, with a copy to the Administrative Agent, at their addresses for notices specified herein anApplication therefor, completed to the satisfaction of such Issuing Lender, and such other certificates, documents and other papers andinformation as such Issuing Lender may reasonably request. Upon receipt of any Application, an Issuing Lender will process such Applicationand the certificates, documents and other papers and information delivered to it in connection therewith in accordance with its customaryprocedures and shall promptly issue the Letter of Credit requested thereby by issuing the original of such Letter of Credit to the beneficiarythereof or as otherwise may be agreed to by such Issuing Lender and the Borrower (but in no event shall any Issuing Lender be required toissue any Letter of Credit earlier than three Business Days after its receipt of the Application therefor and all such other certificates,documents and other papers and information relating thereto). Promptly after issuance by an Issuing Lender of a Letter of Credit, such IssuingLender shall furnish a copy of such Letter of Credit to the Borrower and the Administrative Agent. Each Issuing Lender shall promptly furnishto the Administrative Agent, which shall in turn promptly furnish to the Lenders, notice of the issuance of each Letter of Credit issued by suchIssuing Lender (including the amount thereof).

3.3 Fees and Other Charges. (a) The Borrower will pay a fee in the Applicable Currency on the aggregate drawable amount of alloutstanding Letters of Credit at a per annum rate equal to the Applicable Margin then in effect with respect to LIBO Rate Loans of theApplicable Currency under the Revolving Credit Facility, shared ratably among the Revolving Credit Lenders in accordance with theirrespective Revolving Credit Percentages and payable quarterly in arrears on each L/C Fee Payment Date after the issuance date of such Letterof Credit. In addition, the Borrower shall pay to the relevant Issuing Lender for its own account a fronting fee in the Applicable Currency onthe aggregate drawable amount of

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all outstanding Letters of Credit issued by it of 1/8 of 1% per annum, payable quarterly in arrears on each L/C Fee Payment Date after theissuance of such Letter of Credit.

(b) In addition to the foregoing fees, the Borrower shall pay or reimburse each Issuing Lender for such normal and customary costs andexpenses as are incurred or charged by such Issuing Lender in issuing, negotiating, effecting payment under, amending or otherwiseadministering any Letter of Credit.

3.4 L/C Participations. (a) Each Issuing Lender irrevocably agrees to grant and hereby grants to each L/C Participant, and, to induceeach Issuing Lender to issue Letters of Credit hereunder, each L/C Participant irrevocably agrees to accept and purchase and hereby acceptsand purchases from each Issuing Lender, on the terms and conditions hereinafter stated, for such L/C Participant's own account and risk, anundivided interest equal to such L/C Participant's Revolving Credit Percentage in each Issuing Lender's obligations and rights under eachLetter of Credit issued by such Issuing Lender hereunder and the amount of each draft paid by such Issuing Lender thereunder. Each L/CParticipant unconditionally and irrevocably agrees with each Issuing Lender that, if a draft is paid under any Letter of Credit issued by suchIssuing Lender for which such Issuing Lender is not reimbursed in full by the Borrower in accordance with the terms of this Agreement, suchL/C Participant shall pay to such Issuing Lender, regardless of the occurrence or continuance of a Default or Event of Default or the failure tosatisfy any of the other conditions specified in Section 5, upon demand at the Administrative Agent's address for notices specified herein (andthereafter, the Administrative Agent shall promptly pay to the Issuing Lender) an amount in the Applicable Currency equal to such L/CParticipant's Revolving Credit Percentage of the amount of such draft, or any part thereof, that is not so reimbursed.

(b) If any amount required to be paid by any L/C Participant to an Issuing Lender pursuant to Section 3.4(a) in respect of anyunreimbursed portion of any payment made by such Issuing Lender under any Letter of Credit is paid to such Issuing Lender within threeBusiness Days after the date such payment is due, the Issuing Lender shall so notify the Administrative Agent, who shall promptly notify theL/C Participants and each such L/C Participant shall pay to the Administrative Agent, for the account of the Issuing Lender on demand (andthereafter the Administrative Agent shall promptly pay to the Issuing Lender) an amount equal to the product of (i) such amount, times(ii) [(x) if the Applicable Currency is Dollars,] the daily average Federal Funds Effective Rate [or (y) if the Applicable Currency is euro, therate per annum applicable to Revolving Credit Euro Loans with Interest Periods of one month, in each case] during the period from andincluding the date such payment is required to the date on which such payment is immediately available to such Issuing Lender, times (iii) afraction the numerator of which is the number of days that elapse during such period and the denominator of which is 360. If any such amountrequired to be paid by any L/C Participant pursuant to Section 3.4(a) is not made available to the Administrative Agent, for the account ofsuch Issuing Lender by such L/C Participant within three Business Days after the date such payment is due, the Administrative Agent, onbehalf of such Issuing Lender shall be entitled to recover from such L/C Participant, on demand, (x) if the Applicable Currency is Dollars,such amount with interest thereon calculated from such due date at the rate per annum applicable to Base Rate Loans under the RevolvingCredit Facility and (y) if the Applicable Currency is euro, such amount with interest thereon calculated from such due date at the rate perannum applicable to Revolving Credit Euro Loans with Interest Periods determined by the Administrative Agent under the Revolving CreditFacility. A certificate of the Administrative Agent on behalf of such Issuing Lender submitted to any L/C Participant with respect to any suchamounts owing under this Section shall be conclusive in the absence of manifest error.

(c) Whenever, at any time after an Issuing Lender has made payment under any Letter of Credit and has received from theAdministrative Agent any L/C Participant's pro rata share of such payment in accordance with Section 3.4(a), such Issuing Lender receivesany payment related to such Letter of Credit (whether directly from the Borrower or otherwise, including proceeds of collateral applied theretoby such Issuing Lender), or any payment of interest on account thereof, such Issuing Lender will distribute to the Administrative Agent for theaccount of such L/C Participant (and thereafter, the Administrative Agent will promptly distribute to such L/C Participant) its pro rata sharethereof; provided, however, that in the

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event that any such payment received by such Issuing Lender shall be required to be returned by such Issuing Lender, such L/C Participantshall return to the Administrative Agent for the account of such Issuing Lender the portion thereof previously distributed by such IssuingLender to it.

3.5 Reimbursement Obligation of the Borrower. The Borrower agrees to reimburse each Issuing Lender, no later than 1:00 p.m., NewYork City time, on the Business Day, if the Applicable Currency is Dollars, and on the third Business Day, if the Applicable Currency is euro,following the Business Day on which such Issuing Lender notifies the Borrower of the date and amount of a draft presented under any Letterof Credit and paid by such Issuing Lender, for the amount of (a) such draft so paid and (b) any taxes, fees, charges or other costs or expensesincurred by such Issuing Lender in connection with such payment (the amounts described in the foregoing clauses (a) and (b) in respect of anydrawing, collectively, the "Payment Amount"). Each such payment shall be made to such Issuing Lender at its address for notices specifiedherein in the Applicable Currency and in immediately available funds. Interest shall be payable on each Payment Amount from the date of theapplicable drawing until payment in full at the rate of interest applicable during such period to Revolving Credit Loans that are (i) if theApplicable Currency is Dollars, Base Rate Loans or (ii) if the Applicable Currency is euro, Revolving Credit Euro Loans with Interest Periodsof one month, plus, in each case, for the period from the third Business Day following the date of the applicable drawing, 2% per annum. Eachdrawing under any Letter of Credit shall (unless an event of the type described in clause (i) or (ii) of Section 8(f) shall have occurred and becontinuing with respect to the Borrower, in which case the procedures specified in Section 3.4 for funding by L/C Participants shall apply)constitute a request by the Borrower to the Administrative Agent for a borrowing pursuant to Section 2.5 of (i) if the Applicable Currency isDollars, Base Rate Loans (or, at the option of the Administrative Agent and the Swing Line Lender in their sole discretion, a borrowingpursuant to Section 2.7 of Swing Line Loans) or (ii) if the Applicable Currency is euro, Revolving Credit Euro Loans with Interest Periods ofone month, in each case in the amount of such drawing. The Borrowing Date with respect to such borrowing shall be the first date on which aborrowing of (i) if the Applicable Currency is Dollars, Base Rate Loans (or, if applicable, Swing Line Loans) or (ii) if the ApplicableCurrency is euro, Revolving Credit Euro Loans could be made, pursuant to Section 2.5 (or, if applicable, Section 2.7), if the AdministrativeAgent had received a notice of such borrowing at the time the Administrative Agent receives notice from the relevant Issuing Lender of suchdrawing under such Letter of Credit.

3.6 Obligations Absolute. The Borrower's obligations under this Section 3 shall be absolute and unconditional under any and allcircumstances and irrespective of any setoff, counterclaim or defense to payment that the Borrower may have or have had against any IssuingLender, any beneficiary of a Letter of Credit or any other Person. The Borrower also agrees with each Issuing Lender that such Issuing Lendershall not be responsible for, and the Borrower's Reimbursement Obligations under Section 3.5 shall not be affected by, among other things, thevalidity or genuineness of documents or of any endorsements thereon, even though such documents shall in fact prove to be invalid, fraudulentor forged, or any dispute between or among the Borrower and any beneficiary of any Letter of Credit or any other party to which such Letterof Credit may be transferred or any claims whatsoever of the Borrower against any beneficiary of such Letter of Credit or any such transferee.No Issuing Lender shall be liable for any error, omission, interruption or delay in transmission, dispatch or delivery of any message or advice,however transmitted, in connection with any Letter of Credit, except for those resulting from a breach of standard of care specified in the UCCof the State of New York. The Borrower agrees that any action taken or omitted by an Issuing Lender under or in connection with any Letterof Credit issued by it or the related drafts or documents, if done in accordance with the standards of care specified in the UCC of the State ofNew York, shall be binding on the Borrower and shall not result in any liability of such Issuing Lender to the Borrower.

3.7 Letter of Credit Payments. If any draft shall be presented for payment under any Letter of Credit, the relevant Issuing Lender shallpromptly (and in any event within one Business Day) notify the Administrative Agent and the Borrower of the date and amount thereof. Theresponsibility of the relevant

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Issuing Lender to the Borrower in connection with any draft presented for payment under any Letter of Credit shall, in addition to anypayment obligation expressly provided for in such Letter of Credit issued by such Issuing Lender, be limited to determining that thedocuments (including each draft) delivered under such Letter of Credit in connection with such presentment are substantially in conformitywith such Letter of Credit.

3.8 Applications. To the extent that any provision of any Application related to any Letter of Credit is inconsistent with the provisionsof this Agreement or the other Loan Documents, the provisions of this Agreement or the other Loan Documents shall apply.

SECTION 4. REPRESENTATIONS AND WARRANTIES

To induce the Arrangers, the Agents and the Lenders to enter into this Agreement and to make the Loans and issue or participate in theLetters of Credit, Holdings and the Borrower hereby jointly and severally represent and warrant to the Arrangers, each Agent and each Lenderthat:

4.1 Financial Condition. (a) The unaudited pro forma consolidated balance sheet of Holdings and its consolidated Subsidiaries as atSeptember 30, 2005 (including the notes thereto) (the "Pro Forma Balance Sheet"), copies of which have heretofore been furnished to eachLender, has been prepared giving effect (as if such events had occurred on such date) to (i) the consummation of the Transaction, (ii) theLoans to be made and the Senior Notes to be issued on the Closing Date and the use of proceeds thereof and (iii) the payment of fees andexpenses in connection with the foregoing. The Pro Forma Balance Sheet has been prepared based on the information available to Holdingsand the Borrower as of the date of delivery thereof and on good faith estimates and assumptions believed by it to be reasonable as of the dateof delivery thereof, and presents fairly in all material respects on a pro forma basis the estimated financial position of Holdings and itsconsolidated Subsidiaries as at September 30, 2005, assuming that the events specified in the preceding sentence had actually occurred at suchdate, subject to normal year-end adjustments and the absence of footnotes of the type typically included in audited statements prepared inaccordance with GAAP.

(b) The audited combined balance sheets of "Tronox" as at December 31, 2004 and December 31, 2003 and the related combinedstatements of operations and of cash flows for each of the three years in the period ended December 31, 2004, included in the ConfidentialInformation Memorandum and reported on by and accompanied by an unqualified report from Ernst & Young, LLP, present fairly in allmaterial respects the combined financial condition of Holdings and the Contributed Subsidiaries as at such date, and the combined results ofits operations and its combined cash flows for the respective fiscal years then ended. The unaudited combined balance sheet of "Tronox" as atSeptember 30, 2005, and the related unaudited combined statements of income and cash flows for the nine-month period ended on such date,included in the registration statement on Form S-1 filed with the SEC contemporaneously herewith, present fairly in all material respects thecombined financial condition of Holdings and the Contributed Subsidiaries as at such date, and the combined results of its operations and itscombined cash flows for the nine-month period then ended (subject to normal year end audit adjustments and the absence of footnotes). Allsuch financial statements, including the related schedules and notes thereto, have been prepared in accordance with GAAP appliedconsistently throughout the periods involved (except as approved by the aforementioned firm of accountants and disclosed therein and, in thecase of the unaudited financial statements, subject to normal year-end audit adjustments and the absence of footnotes).

(c) Holdings, the Borrower and its Subsidiaries do not have any material Guarantee Obligations, contingent liabilities and liabilities fortaxes, or any long-term leases or unusual forward or long-term commitments, including any interest rate or foreign currency swap or exchangetransaction or other obligation in respect of derivatives, in each case which is material and required by GAAP to be, but that is not, reflected ordisclosed in the most recent financial statements referred to in Section 4.1(b). During the

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period from December 31, 2004 to and including the date hereof none of Holdings, the Borrower or any Contributed Subsidiary has Disposedof any material part of its business or Property.

(d) The financial statements specified in Section 4.1(b) reflect the combined financial position and combined results of operations of theContributed Business as of the dates and for the periods specified therein in all material respects in accordance with GAAP and on the basisdescribed in Section 4.1(b).

4.2 No Change. Since December 31, 2004 there has been no development or event that has had or could reasonably be expected tohave a Material Adverse Effect, except for the matter described on Schedule 4.6(b) hereto.

4.3 Corporate Existence; Compliance with Law. Each of Holdings, the Borrower and its Subsidiaries (a) is duly organized, validlyexisting and in good standing (if applicable) under the laws of the jurisdiction of its organization, (b) has the corporate or limited liabilitycompany, as applicable, power and authority and the legal right, to own and operate its Property, to lease the Property it operates as lessee andto conduct the business in which it is currently engaged, (c) is duly qualified as a foreign corporation (or other entity) and in good standing (ifapplicable) under the laws of each jurisdiction where its ownership, lease or operation of Property or the conduct of its business requires suchqualification, except to the extent that the failure to so qualify could not reasonably be expected to have a Material Adverse Effect and (d) is incompliance with all Requirements of Law except to the extent that the failure to comply therewith could not, in the aggregate, reasonably beexpected to have a Material Adverse Effect.

4.4 Organizational Power; Authorization; Enforceable Obligations. Each Loan Party has the corporate or limited liability company, asapplicable, power and authority, and the legal right, to make, deliver and perform the Loan Documents and Transaction Documentation towhich it is a party and, in the case of the Borrower, to borrow hereunder. Each Loan Party has taken all necessary corporate or otherorganizational action to authorize the execution, delivery and performance of the Loan Documents and Transaction Documentation to which itis a party and, in the case of the Borrower, to authorize the borrowings on the terms and conditions of this Agreement. No material consent ormaterial authorization of, material filing with, material notice to, material Permit from or other material act by or in respect of, anyGovernmental Authority and no material consent or material authorization of, material filing with, material notice to or other material act byor in respect of any other Person is required in connection with the Transaction, the borrowings hereunder or the execution, delivery,performance, validity or enforceability of this Agreement or any of the other Loan Documents or the Transaction Documentation except(i) consents, authorizations, filings and notices which have been obtained or made and are in full force and effect and (to the extent obtained ormade in respect of any Loan Documents) are described in Schedule 4.4 and (ii) filings in respect of Liens created pursuant to the SecurityDocuments. Each Loan Document and each item of Transaction Documentation has been duly executed and delivered on behalf of each LoanParty that is a party thereto. This Agreement and each Transaction Document constitutes, and each other Loan Document upon execution willconstitute, a legal, valid and binding obligation of each Loan Party that is a party thereto, enforceable against each such Loan Party inaccordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium orsimilar laws affecting the enforcement of creditors' rights generally and by general equitable principles (whether enforcement is sought byproceedings in equity or at law).

4.5 No Legal Bar. The execution, delivery and performance of this Agreement and the other Loan Documents, the Senior NoteDocumentation, the Transaction Documentation, the issuance of Letters of Credit, the borrowings hereunder and the use of the proceedsthereof will not violate in any material respect any material Requirement of Law or any Material Contractual Obligation of Holdings, theBorrower or any of its Subsidiaries and will not result in, or require, the creation or imposition of any Lien on any of their respectiveproperties or revenues pursuant to any such material Requirement of Law or any such Material Contractual Obligation (other than the Lienscreated by the Security Documents).

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4.6 No Material Litigation. No litigation, investigation or proceeding of or before any arbitrator or Governmental Authority is pendingor, to the knowledge of Holdings or the Borrower, threatened by or against Holdings, the Borrower or any of its Subsidiaries or against any oftheir respective properties or revenues (a) with respect to any of the Loan Documents, the Transaction Documentation or any of thetransactions contemplated hereby or thereby that could reasonably be expected to be materially adverse to the Agents or the Lenders, or(b) except for the matter described on Schedule 4.6(b) hereto, that could reasonably be expected to have a Material Adverse Effect.

4.7 No Default. Neither Holdings, the Borrower nor any of its Subsidiaries is in default under or with respect to any of its ContractualObligations in any respect that could reasonably be expected to have a Material Adverse Effect. No Default or Event of Default has occurredand is continuing.

4.8 Ownership of Property; Liens. (a) Except as set forth on Schedule 4.8(a), each of Holdings, the Borrower and its Subsidiaries isthe sole owner of, legally and beneficially, and has good marketable and insurable title in fee simple to, or a valid leasehold interest in, all itsmaterial real property, and good title to, or a valid leasehold interest in, all its material other Property used in its business as currentlyconducted, and none of such Property is subject to any Liens except for Permitted Liens. None of the Collateral is subject to any Lien exceptfor Permitted Liens.

(b) All material leases and agreements necessary for the conduct of the business of the Borrower and its Subsidiaries are valid andsubsisting, in full force and effect, and there exists no default or event or circumstance which with the giving of notice or the passage of timeor both, would give rise to a default on the part of the Borrower or any of its Subsidiaries, under any such lease or leases, which would affectin any material respect the conduct of the business of the Borrower and its Subsidiaries, taken as a whole.

(c) The rights and properties presently owned, leased or licensed by the Borrower and its Subsidiaries, including all easements andrights of way, include all rights and properties necessary to permit the Borrower and its Subsidiaries to conduct their business in all materialrespects in the same manner as their business has been conducted prior to the date hereof.

(d) All of the properties of the Borrower and its Subsidiaries which are reasonably necessary for the operation of their business are ingood working condition and are maintained in accordance with prudent business standards.

4.9 Intellectual Property. Except as, in the aggregate, could not reasonably be expected to have a Material Adverse Effect:(a) Holdings, the Borrower and each of its Subsidiaries owns, or is licensed to use, all Intellectual Property necessary for the conduct of itsbusiness as currently conducted, (b) no material claim has been asserted and is pending by any Person challenging or questioning the use ofany Intellectual Property or the validity or effectiveness of any Intellectual Property and (c) to the knowledge of the Borrower the use ofIntellectual Property by Holdings, the Borrower and its Subsidiaries does not infringe on the rights of any Person in any material respect.

4.10 Taxes. All U.S. Federal and other material tax returns that are required to be filed by or on behalf of Holdings, the Borrower andeach of its Subsidiaries or by any consolidated group of which Holdings, the Borrower or any of its Subsidiaries is or has been a member havebeen duly filed except as set forth on Schedule 4.10 hereto; all material taxes shown to be due and payable on said returns or on any materialassessments made against Holdings, the Borrower or any Subsidiary thereof or any Property of any thereof and all other material taxes, fees orother charges imposed on Holdings, the Borrower or any Subsidiary thereof or any Property of any thereof by any Governmental Authorityhave been paid (other than any tax the amount or validity of which are currently being contested in good faith by appropriate proceedings andwith respect to which reserves in conformity with GAAP have been provided on the books of Holdings, the Borrower or its Subsidiaries, asthe case may be); the contents of all such material tax returns are correct and complete in all material respects; no material tax Lien has beenfiled that would not be a Permitted Lien. No Loan Party and no Subsidiary thereof (i) intends to treat the Loans, the

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Transaction, or any other transaction contemplated hereby as being a "reportable transaction" (within the meaning of TreasuryRegulation 1.6011-4) or (ii) is aware of any facts or events that would result in such treatment.

4.11 Federal Regulations. No part of the proceeds of any Loans, and no other extensions of credit hereunder, will be used in violation ofRegulation U as now and from time to time hereafter in effect.

4.12 Labor Matters. There are no strikes, stoppages or slowdowns or other labor disputes against Holdings, the Borrower or any of itsSubsidiaries pending or, to the knowledge of Holdings or the Borrower, threatened that (individually or in the aggregate) could reasonably beexpected to have a Material Adverse Effect. Hours worked by and payment made to employees of Holdings, the Borrower and its Subsidiarieshave not been in violation of the Fair Labor Standards Act or any other applicable Requirement of Law dealing with such matters that(individually or in the aggregate) could reasonably be expected to have a Material Adverse Effect. All payments due from Holdings, theBorrower or any of its Subsidiaries on account of employee health and welfare insurance that (individually or in the aggregate) couldreasonably be expected to have a Material Adverse Effect if not paid have been paid or accrued as a liability on the books of Holdings, theBorrower or the relevant Subsidiary.

4.13 ERISA. Neither a Reportable Event nor an "accumulated funding deficiency" (within the meaning of Section 412 of the Code orSection 302 of ERISA) has occurred during the five year period prior to the date on which this representation is made or deemed made withrespect to any Plan, and each Plan has complied in all material respects with the applicable provisions of ERISA and the Code, except to theextent any non-compliance could not reasonably be expected to have a Material Adverse Effect. No termination of a Single Employer Plan hasoccurred, and no Lien in favor of the PBGC or a Plan has arisen, during such five-year period. The present value of all accrued benefits undereach Single Employer Plan (based on those assumptions used to fund such Plans) did not, as of the last annual valuation date prior to the dateon which this representation is made or deemed made, exceed the value of the assets of such Plan allocable to such accrued benefits by amaterial amount. Neither the Borrower nor any Commonly Controlled Entity has had a complete or partial withdrawal from anyMultiemployer Plan that has resulted or could reasonably be expected to result in a material liability under ERISA, and, to the knowledge ofthe Borrower, neither the Borrower nor any Commonly Controlled Entity would become subject to any material liability under ERISA if theBorrower or any such Commonly Controlled Entity were to withdraw completely from all Multiemployer Plans as of the valuation date mostclosely preceding the date on which this representation is made or deemed made. No such Multiemployer Plan is in Reorganization orInsolvent.

4.14 Investment Company Act; Other Regulations. No Loan Party is an "investment company", within the meaning of the InvestmentCompany Act of 1940, as amended. No Loan Party is subject to regulation under any material Requirement of Law (other than Regulation X)which limits or conditions its ability to incur Indebtedness under the Loan Documents.

4.15 Subsidiaries. (a) The Subsidiaries listed on Schedule 4.15(a) constitute (x) all the Subsidiaries of the Borrower and Holdings as ofthe Closing Date and (y) all of the Contributed Subsidiaries. Schedule 4.15(a) sets forth as of the Closing Date and after giving effect to theTransaction, the exact legal name (as reflected on the certificate of incorporation (or formation) and jurisdiction of incorporation (orformation) of each Subsidiary of Holdings and, as to each such Subsidiary, the percentage and number of each class of Capital Stock ownedby each Loan Party and its Subsidiaries and whether such Subsidiary is a Foreign Subsidiary, Immaterial Subsidiary or Special PurposeSubsidiary.

(b) As of the Closing Date, other than as listed on Schedule 4.15(b), there are no outstanding subscriptions, options, warrants, calls,rights or other agreements or commitments (other than stock options granted to employees or directors and directors' qualifying shares) of anynature relating to any Capital Stock of the Borrower or any Subsidiary. As of the Closing Date, neither the Borrower nor any of itsSubsidiaries has issued any Disqualified Stock.

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(c) Holdings has no direct Subsidiary other than the Borrower. As of the Closing Date, each Subsidiary of the Borrower is (x) except asspecified on Schedule 4.15(a), a Wholly Owned Subsidiary and (y) except for any Foreign Subsidiary, Special Purpose Subsidiary, ImmaterialSubsidiary or KMEMC, a Wholly Owned Subsidiary Guarantor.

4.16 Use of Proceeds. The proceeds of the Tranche A Term Loans shall be used to finance a portion of the Distribution and to payrelated fees and expenses. The proceeds of the Revolving Credit Loans and the Swing Line Loans, and the Letters of Credit, shall be used forgeneral corporate purposes.

4.17 Environmental Matters. Other than exceptions to any of the following that could not, individually or in the aggregate, reasonablybe expected have a Material Adverse Effect and except for the matter specified in Schedule 4.6(b) hereto:

(a) There are no environmental assessments, audits or other written environmental reports that have been prepared as to any MortgagedProperty that are in the possession of the Loan Parties and reveal the presence of Materials of Environmental Concern in such amounts ascould reasonably be expected to have a Material Adverse Effect, that have not been provided to the Administrative Agent.

(b) Holdings, the Borrower and its Subsidiaries: (w) are, and within the period of all applicable statutes of limitation have been, incompliance with all applicable Environmental Laws; (x) hold all Environmental Permits (each of which is in full force and effect) required forany of their current or intended operations or for any property owned, leased, or otherwise operated by any of them; (y) are, and within theperiod of all applicable statutes of limitation have been, in compliance with all of their Environmental Permits; and (z) reasonably believe that:each of their Environmental Permits will be timely renewed and complied with any additional Environmental Permits that may be required ofany of them will be timely obtained and complied with and compliance with any Environmental Law that is or is expected to becomeapplicable to any of them will be timely attained and maintained.

(c) Materials of Environmental Concern are not present at, on, under, in, or about any real property now or formerly owned, leased oroperated by Holdings, the Borrower or any of its Subsidiaries, or at any other location (including any location to which Materials ofEnvironmental Concern have been sent for re-use or recycling or for treatment, storage, or disposal) which could reasonably be expected to(x) give rise to liability of Holdings, the Borrower or any of its Subsidiaries under any applicable Environmental Law or otherwise result incosts to Holdings, the Borrower or any of its Subsidiaries, or (y) interfere with Holdings, the Borrower's or any of its Subsidiaries' continuedoperations, or (z) impair the fair saleable value of any real property owned or leased by Holdings, the Borrower or any of its Subsidiaries.

(d) There is no pending or, to the Knowledge of Holdings, the Borrower or any of its Subsidiaries, threatened, judicial, administrative,or arbitral proceeding (including any notice of violation or alleged violation) under or relating to any Environmental Law to which Holdings,the Borrower or any of its Subsidiaries is, or to the knowledge of Holdings, the Borrower or any of its Subsidiaries will be, named as a party.

(e) Neither Holdings, the Borrower nor any of its Subsidiaries has received any written request for information, or been notified that it isa potentially responsible party under or relating to the federal Comprehensive Environmental Response, Compensation, and Liability Act orany similar Environmental Law, or with respect to any Materials of Environmental Concern.

(f) Neither Holdings, the Borrower nor any of its Subsidiaries has entered into or agreed to any consent decree, order, or settlement orother agreement, or is subject to any judgment, decree, order, settlement or other agreement relating to compliance with or liability under anyEnvironmental Law.

(g) Neither Holdings, the Borrower nor any of its Subsidiaries has assumed or retained by contract or, to the knowledge of theBorrower, operation of law, any liabilities of any kind, fixed or contingent, under any Environmental Law or with respect to any Material ofEnvironmental Concern.

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4.18 Accuracy of Information, etc. (a) No statement or information contained in this Agreement, any other Loan Document, theConfidential Information Memorandum or any other document, certificate or statement (excluding any projections, pro forma financialinformation or estimates included in any such statement, document or certificate) relating to any Loan Party furnished to the AdministrativeAgent, the Arrangers, the Agents or the Lenders or any of them, by or on behalf of any Loan Party for use in connection with the transactionscontemplated by this Agreement or the other Loan Documents, (taken together with all information so furnished and as modified orsupplemented by the other information so furnished, including the registration statement on Form S-1 filed and effective contemporaneouslyherewith), contained as of the date such statement, information, document or certificate was so furnished, any untrue statement of a materialfact or omitted to state a material fact necessary in order to make the statements contained herein or therein not misleading. The projections,pro forma financial information and estimates contained in the materials referenced above are based upon good faith estimates andassumptions believed by management of Holdings and the Borrower to be reasonable at the time made, it being recognized by the Agents,Arrangers and Lenders that such financial information as it relates to future events is not to be viewed as fact and that actual results during theperiod or periods covered by such financial information may differ from the projected results set forth therein by a material amount.

(b) As of the Closing Date, the representations and warranties made by Holdings and its Subsidiaries contained in the TransactionAgreements are true and correct in all material respects, except for representations and warranties expressly stated to relate to a specific earlierdate, in which case such representations and warranties are true and correct in all material respects as of such earlier date.

4.19 Security Documents. (a) The Guarantee and Collateral Agreement is effective to create in favor of the Administrative Agent, forthe benefit of the Secured Parties, a legal, valid, binding and enforceable security interest in the Personal Property Collateral and proceeds andproducts thereof, to the extent contemplated by the Guarantee and Collateral Agreement. In the case of the Stock Collateral, when any stockcertificates representing such Stock Collateral are delivered to the Administrative Agent, and in the case of the other Personal PropertyCollateral, when financing statements in appropriate form are filed in the offices specified on Schedule 4.19(a)-1 (which financing statementsmay be filed by the Administrative Agent) at any time and such other filings as are specified on Schedule 3 to the Guarantee and CollateralAgreement have been completed (all of which filings may be filed by the Administrative Agent) at any time, the Guarantee and CollateralAgreement shall constitute a fully perfected Lien on, and security interest in, all right, title and interest of the Loan Parties in such PersonalProperty Collateral and the proceeds and products thereof, to the extent contemplated by the Guarantee and Collateral Agreement, as securityfor the Obligations (as defined in the Guarantee and Collateral Agreement), in each case prior and superior in right to any other Person (exceptPermitted Liens). As of the Closing Date, Schedule 4.19(a)-2 lists each UCC Financing Statement that (i) names any Loan Party as debtor and(ii) will remain on file after the Closing Date. As of the Closing Date, Schedule 4.19(a)-3 lists each UCC Financing Statement that (i) namesany Loan Party as debtor and (ii) will be terminated on or prior to the Closing Date; and on or prior to the Closing Date, the Borrower willhave delivered to the Administrative Agent, or caused to be filed, duly completed UCC termination statements, authorized by the relevantsecured party, in respect of each such UCC Financing Statement.

(b) Each of the Mortgages is (or, in the case of any Mortgage to be executed and delivered pursuant to Section 7.21 will be uponexecution and delivery) effective to create in favor of the Administrative Agent, for the benefit of the Secured Parties, a legal, valid, bindingand enforceable Lien on the Mortgaged Properties described therein and proceeds and products thereof; and when the Mortgages are filed inthe offices specified on Schedule 4.19(b) (in the case of Mortgages to be executed and delivered on the Closing Date) or in the recordingoffice designated in Schedule 7.21 (in the case of any Mortgage to be executed and delivered pursuant to Section 7.21), each Mortgage shallconstitute a fully perfected Lien on, and security interest in, all right, title and interest of the Loan Parties in the Mortgaged Propertiesdescribed therein and the proceeds and products thereof, to the extent contemplated by such Mortgage, as

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security for the Obligations (as defined in the relevant Mortgage), in each case prior and superior in right to the rights of any other Person(other than Persons holding Liens or other encumbrances or rights permitted by the relevant Mortgage and other than Permitted Liens).

4.20 Solvency. As of the Closing Date, the Borrower, together with the Subsidiary Guarantors taken as a whole, is, and after givingeffect to the Transaction and the incurrence of all Indebtedness and obligations being incurred in connection herewith and therewith, will beand will continue to be, Solvent.

4.21 Insurance. Each of Holdings, the Borrower and its Subsidiaries is insured, in accordance with Section 6.5 hereof, by insurers ofrecognized financial responsibility against such losses and risks and in such amounts as are, when considered in its entirety, in the good faithjudgment of the Borrower, prudent and customary in the businesses in which it is engaged, including at least $100,000,000 of product liabilityinsurance.

4.22 Transaction. (a) As of the Closing Date, the Transaction Documentation listed on Schedule 4.22 attached hereto constitutes all ofthe material agreements, instruments and undertakings to which Holdings, the Borrower or any of its Subsidiaries is bound or by which suchPerson or any of its property or assets is bound or affected relating to, or arising out of, the Transaction (including any agreements,instruments or undertakings assumed pursuant to the Transaction Agreements). As of the Closing Date, none of such material agreements,instruments or undertakings have been amended, supplemented or otherwise modified, and all such material agreements, instruments andundertakings are in full force and effect. As of the Closing Date, no party to any Transaction Documentation is currently in default thereunderand no party thereto, or any other Person, has the right to terminate any Transaction Documentation.

(b) After giving effect to consummation of the Transaction, no event of default exists under (i) any of the Transaction Agreements,(ii) the Senior Notes, (iii) any other Material Indebtedness or (iv) for such time as Holdings is a Subsidiary of KMG, the KMG Specified DebtInstruments.

(c) On the Closing Date, there is no indebtedness owing by Holdings or any of the Contributed Subsidiaries to KMG or any of itsSubsidiaries (other than Holdings and the Contributed Subsidiaries).

(d) Each KMG Party has the corporate or limited liability company, as applicable, power and authority, and the legal right, to make,deliver and perform the Transaction Documentation to which it is a party. Each KMG Party has taken all necessary corporate or otherorganizational action to authorize the execution, delivery and performance of the Transaction Documentation to which it is a party. Nomaterial consent or material authorization of, material filing with, material notice to material Permit from or other material act by or in respectof, any Governmental Authority and no material consent or material authorization of, material filing with, material notice to or other materialact by or in respect of any other Person is required in connection with the Transaction, or the execution, delivery, performance, validity orenforceability of any of the Transaction Documentation except consents, authorizations, filings and notices which have been obtained or madeand are in full force and effect. Each item of Transaction Documentation has been duly executed and delivered on behalf of each KMG Partythat is a party thereto. Each Transaction Document constitutes a legal, valid and binding obligation of each KMG Party that is a party thereto,enforceable against each such KMG Party in accordance with its terms, except as enforceability may be limited by applicable bankruptcy,insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors' rights generally and by general equitableprinciples (whether enforcement is sought by proceedings in equity or at law).

(e) The execution, delivery and performance of the Transaction Documentation will not violate in any material respect any materialRequirement of Law or any material contractual obligation of KMG or any of its Subsidiaries (other than Holdings and the ContributedSubsidiaries) and will not result in, or require, the creation or imposition of any Lien on any of the properties or revenues of Holdings, theBorrower or any of its Subsidiaries pursuant to any such material Requirement of Law or any such material

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contractual obligation (other than the Liens created by the Security Documents and other than Permitted Liens).

(f) As of the Closing Date, no litigation, investigation or proceeding of or before any arbitrator or Governmental Authority is pendingor, to the knowledge of Holdings or the Borrower, threatened by or against KMG or any of its Subsidiaries or against any of their respectiveproperties or revenues with respect to any of the Transaction Documentation or any of the transactions contemplated thereby.

(g) The Borrower has delivered to the Administrative Agent a complete and correct copy of the Transaction Agreements and the SeniorNote Documentation and any Senior Unsecured Debt Documents, any Subordinated Debt Documents and any Senior Note RefinancingDocuments, in each case, including any amendments, supplements or modifications with respect to any of the foregoing.

(h) Each of Holdings, the Borrower and any Subsidiary thereof either (i) constitutes an "Unrestricted Subsidiary" under and as definedin the KMG Existing Credit Agreement or (ii) is not a Subsidiary of KMG.

4.23 Real Estate. As of the Closing Date, Schedule 4.23 includes a list of all real property that has a fair market value (as determined bythe Borrower in good faith without the need to procure appraisals or update any existing appraisals) in excess of $25,000,000 and locatedwithin the United States and (i) owned by any Loan Party or its Subsidiaries in fee simple or (ii) leased by any Loan Party or its Subsidiariesand used by such Loan Party and Subsidiary as a distribution or manufacturing facility.

4.24 Permits. Other than as disclosed on Schedule 4.24 and other than exceptions to any of the following that could not, individually orin the aggregate, reasonably be expected to have a Material Adverse Effect: (i) each Loan Party has obtained and holds all Permits required forany property owned, leased or otherwise operated by or on behalf of, or for the benefit of, such Person and for the operation of each of itsbusinesses as presently conducted and as proposed to be conducted, (ii) all such Permits are in full force and effect, and each Loan Party hasperformed and observed all requirements of such Permits, (iii) no event has occurred which allows or results in, or after notice or lapse of timewould allow or result in, revocation or termination by the issuer thereof or in any other impairment of the rights of the holder of any suchPermit, (iv) no Loan Party has received any written notice that any of its Permits will not be timely renewed and complied with, withoutmaterial expense, or that any additional Permits that may be required of such Person will not be timely obtained and complied with, withoutmaterial expense.

4.25 Regulation H. No Mortgage encumbers improved real property which is located in an area that has been identified by theSecretary of Housing and Urban Development as an area having special flood hazards and in which flood insurance has been made availableunder the National Flood Insurance Act of 1968 (except any Mortgaged Properties as to which such flood insurance as required byRegulation H has been obtained and is in full force and effect as required by this Agreement).

SECTION 5. CONDITIONS PRECEDENT

5.1 Conditions to Initial Extension of Credit. The agreement of each Lender to make the initial extension of credit requested to bemade by it hereunder is subject to the satisfaction, prior to or concurrently with the making of such extension of credit on the Closing Date, ofthe following conditions precedent:

(a) Loan Documents. The Administrative Agent shall have received (i) this Agreement, executed and delivered by a duly authorizedofficer of each of Holdings and the Borrower, (ii) the Guarantee and Collateral Agreement, executed and delivered by a duly authorizedofficer of Holdings, the Borrower and each Domestic Subsidiary thereof (other than KMEMC and any Immaterial Subsidiary), (iii), except ascontemplated by Section 7.21 hereof, a Mortgage covering each of the Mortgaged Properties, executed and delivered by a duly authorizedofficer of each party thereto, (iv) a Lender Addendum executed and delivered by each Lender and accepted by the Borrower, and (v) ifrequested by any Lender, for the

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account of such Lender, Notes conforming to the requirements hereof and executed and delivered by a duly authorized officer of theBorrower.

In the event that any one or more of the Lenders have not executed and delivered its Lender Addendum on the date scheduled to be theClosing Date (each such Person being referred to herein as a "Non-Executing Lender"), the condition referred to in clause (a)(iv) above shallnevertheless be deemed satisfied if on such date the Borrower and the Administrative Agent shall have designated one or more Persons (the"Designated Lenders") to assume, in the aggregate, all of the Commitments that would have been held by the Non-Executing Lenders (subjectto each such Designated Lender's consent and its execution and delivery of a Lender Addendum).

(b) Transaction, etc. The following conditions in respect of the Transaction shall have been satisfied:

(i) Each of the Contribution, the IPO, the Distribution, the offering of the Notes and, if consummated on or prior to theClosing Date, the Spin-Off/Split-Off shall have been consummated pursuant to the Transaction Documentation, in each case onterms and conditions reasonably satisfactory to the Administrative Agent; and, in particular:

(A) KMG and its Subsidiaries shall have contributed all of its right, title and interest in the Capital Stock of theBorrower to Holdings and all of its right, title and interest in the Capital Stock of the Contributed Subsidiaries (other thanthe Borrower) owned on or prior to the Closing Date by KMG and its Subsidiaries to the Borrower; and in each case suchCapital Stock shall constitute all of the outstanding capital stock of each such entity owned on or prior to the Closing Dateby KMG and its Subsidiaries; and

(B) On the Closing Date, there shall be no indebtedness owing by Holdings or any of the Contributed Subsidiaries toKMG or any of its Subsidiaries (other than Holdings and the Contributed Subsidiaries);

(ii) Holdings shall have received gross cash proceeds from the IPO in an amount not less than 27% of the aggregate grossproceeds of (x) borrowings under the Tranche A Term Loan and the Senior Notes and (y) the IPO;

(iii) the Borrower shall have received at least $250,000,000 in gross cash proceeds from the issuance of the Senior Notes onterms and pursuant to documentation reasonably satisfactory to the Arrangers;

(iv) the capital structure of each Loan Party after giving effect to the Transaction shall be as described in Schedule 4.15(a); and

(v) the cash and cash equivalents of Holdings and its consolidated subsidiaries on hand on the Closing Date after giving effectto the Distribution and excluding any funds borrowed under the Revolving Credit Facility shall be at least $40,000,000.

(c) Pro Forma Balance Sheet; Financial Statements. Consolidated EBITDA of Holdings derived from the financial statementsspecified in Section 4.1(b) for the twelve-month period ended September 30, 2005, of not less than $185 million.

(d) Approvals. All material governmental and third party approvals necessary in connection with the Transaction, the continuingoperations of Holdings, the Borrower and its Subsidiaries and the transactions contemplated hereby shall have been obtained and be in fullforce and effect, and all applicable waiting periods shall have expired without any action being taken or threatened by any GovernmentalAuthority which would restrain, prevent or otherwise impose material adverse conditions on the Transaction or the financing contemplatedhereby.

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(e) Related Agreements; No Defaults. The Administrative Agent shall have received true and correct copies, certified as toauthenticity by the Borrower, of (i) the Senior Note Documentation and (ii) the Transaction Agreements. No provision of any of the SeniorNote Documentation or the Transaction Agreements shall have been waived, amended, supplemented or otherwise modified in a mannermaterial and adverse to the Lenders without the written consent of the Administrative Agent. There shall not exist (pro forma for theTransactions and the financing thereof) any default or event of default under any Transaction Document or the Senior Note Indenture thereforor any other Material Indebtedness of the Borrower or its Subsidiaries or under any KMG Specified Debt Instrument.

(f) Fees. The Lenders, the Arrangers and the Agents shall have received payment on the Closing Date of all fees, and theAdministrative Agent and the Arrangers shall have received reimbursement of all expenses (including reasonable fees, disbursements andother charges of counsel to the Agents), required to be paid by Borrowers or Holdings for which invoices have been presented at least twoBusiness Days prior to the Closing Date. All such amounts will be paid with proceeds of Loans made on the Closing Date and will bereflected in the funding instructions given by the Borrower to the Administrative Agent on or before the Closing Date.

(g) Solvency. The Lenders shall have received a Solvency Certificate which shall document the solvency of the Borrower and theSubsidiary Guarantors considered as a whole after giving effect to the Transaction and the incurrence of all Indebtedness and obligationsbeing incurred in connection herewith and therewith.

(h) Budget. The Lenders shall have received a budget for the Borrower and its Subsidiaries for the 2006 fiscal year.

(i) Lien Searches. The Administrative Agent shall have received the results of a recent lien search in each of the jurisdictions oroffices within the United States in which UCC financing statement should be made to evidence or perfect (with the priority required under theLoan Documents) security interests in all Collateral of the Loan Parties or any jurisdiction or office within the United States in which anexisting effective filing may exist with respect to any Collateral of any Loan Party, and such search shall reveal no Liens on any of the assetsof the Loan Party, except for Permitted Liens or Liens set forth on Schedule 4.19(a)-3.

(j) Ratings. The Facilities shall have received a rating from each of Moody's and S&P.

(k) Closing Certificate. The Administrative Agent shall have received a certificate of Holdings, the Borrower and each SubsidiaryGuarantor, dated the Closing Date, substantially in the form of Exhibit C, with appropriate insertions and attachments.

(l) Other Certifications. The Administrative Agent shall have received the following:

(i) a copy of the Governing Documents of each Loan Party (other than a Loan Party that is not Holdings, the Borrower or aSubsidiary Guarantor) and each amendment thereto, certified (as of a date reasonably near the date of the initial extension of credit)as being a true and correct copy thereof by the Secretary of State or other applicable Governmental Authority of the jurisdiction inwhich such Loan Party is organized;

(ii) a copy of a certificate of the Secretary of State or other applicable Governmental Authority of the jurisdiction in whicheach Loan Party (other than a Loan Party that is not Holdings, the Borrower or a Subsidiary Guarantor) is organized datedreasonably near the date of the initial extension of credit, listing the Governing Documents of such Loan Party and each amendmentthereto on file in such office and certifying that (A) such amendments are the only amendments to such Loan Party's charter on filein such office, (B) such Loan Party has paid all franchise taxes to the date of such certificate and (C) such Loan Party is dulyorganized and in good standing under the laws of such jurisdiction; and

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(iii) an electronic confirmation from the Secretary of State or other applicable Governmental Authority of each jurisdiction inwhich each such Loan Party referred to in clause (ii) above is organized certifying that such Loan Party is duly organized and ingood standing under the laws of such jurisdiction on the date of the initial extension of credit; prepared by, or on behalf of, a filingservice acceptable to the Administrative Agent.

(iv) a copy of a certificate of the Secretary of State or other applicable Governmental Authority of each of Georgia, Oklahoma,Mississippi, and Nevada, dated reasonably near the date of the initial extension of credit, stating that, with respect to each LoanParty (other than a Loan Party that is not Holdings, the Borrower or a Subsidiary Guarantor) that is required to be qualified as aforeign corporation or entity in such jurisdiction, each Loan Party (other than a Loan Party that is not Holdings, the Borrower or aSubsidiary Guarantor) is duly qualified and in good standing as a foreign corporation or entity in each such jurisdiction and has filedall annual reports required to be filed to the date of such certificate.

(m) Legal Opinions. The Administrative Agent shall have received the following executed legal opinions:

(i) the legal opinion of Covington & Burling, counsel to KMG, Holdings, the Borrower and its Subsidiaries, substantially inthe form of Exhibit E-1;

(ii) opinions of such local counsel (in Georgia, Mississippi and Nevada) and foreign counsel (in Denmark, Luxembourg andAustralia) to Holdings, the Borrower and its Subsidiaries as may be reasonably requested by the Administrative Agent, substantiallyin the form of Exhibit E-2;

(iii) the legal opinion of Roger Addison, Esq., Senior Vice President, General Counsel and Secretary of Holdings and theBorrower, substantially in the form of Exhibit E-3; and

(iv) to the extent consented to by the relevant counsel, a copy of each legal opinion, if any, delivered in connection with theTransaction.

(n) Pledged Stock; Stock Powers; Acknowledgment and Consent. The Administrative Agent shall have received (i) the certificates, ifany, representing the shares of Capital Stock pledged pursuant to the Guarantee and Collateral Agreement, together with an undated stockpower, if applicable, for each such certificate executed in blank by a duly authorized officer of the pledgor thereof; (ii) an Acknowledgmentand Consent, substantially in the form of Annex II to the Guarantee and Collateral Agreement, duly executed by any issuer of Capital Stock(other than any Foreign Subsidiary (except to extent necessary to ensure perfection or priority of the Liens under the Security Documents inCollateral constituting Capital Stock issued thereby)) pledged pursuant to the Guarantee and Collateral Agreement that is not itself a party tothe Guarantee and Collateral Agreement; and (iii) each promissory note pledged pursuant to the Guarantee and Collateral Agreement endorsed(without recourse) in blank (or accompanied by an executed transfer form in blank satisfactory to the Administrative Agent) by the pledgorthereof.

(o) Filings, Registrations and Recordings. Except as otherwise expressly contemplated elsewhere in this Agreement or in any otherLoan Document, each document (including any UCC financing statement) required by the Security Documents (other than the Mortgages) orunder law or reasonably requested by the Administrative Agent to be filed, registered or recorded in order to create in favor of theAdministrative Agent, for the benefit of the Secured Parties, a perfected Lien on the Collateral described therein, prior and superior in right toany other Person (other than with respect to Permitted Liens), shall be in proper form, and have been delivered to the Administrative Agent,for filing, registration or recordation.

(p) Insurance. The Administrative Agent shall have received insurance certificates satisfying the requirements of Section 6.5(d)(i) ofthis Agreement.

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(q) Release from Existing Credit Facilities. The Administrative Agent shall have received evidence satisfactory to the AdministrativeAgent that Holdings, the Borrower and its Subsidiaries shall be released from all of their obligations under the KMG Existing CreditAgreement.

5.2 Conditions to Each Extension of Credit. The agreement of each Lender to make any extension of credit requested to be made by ithereunder on any date (including its initial extension of credit) is subject to the satisfaction of the following conditions precedent:

(a) Representations and Warranties. Each of the representations and warranties made by any Loan Party in or pursuant to the LoanDocuments shall be true and correct in all material respects on and as of such date as if made on and as of such date, except for representationsand warranties expressly stated to relate to a specific earlier date, in which case such representations and warranties shall be true and correct inall material respects as of such earlier date.

(b) No Default. No Default or Event of Default shall have occurred and be continuing on such date or after giving effect to theextensions of credit requested to be made on such date.

Each borrowing by and issuance of a Letter of Credit on behalf of the Borrower hereunder shall constitute a representation and warrantyby Holdings and the Borrower as of the date of such extension of credit that the conditions contained in this Section 5.2 have been satisfied.

SECTION 6. AFFIRMATIVE COVENANTS

Holdings and the Borrower hereby jointly and severally agree that, so long as the Commitments remain in effect, any Letter of Creditremains outstanding or any Loan or other amount (excluding Obligations in respect of any Specified Hedge Agreement and unmaturedcontingent reimbursement and indemnification Obligations) is owing to any Lender, any Agent or the Arrangers hereunder, each of Holdingsand the Borrower shall and shall cause each of its Subsidiaries to:

6.1 Financial Statements. Furnish to each Agent and each Lender:

(a) as soon as available, but in any event within 120 days after the end of each fiscal year of Holdings, a copy of the auditedconsolidated balance sheet of Holdings and its consolidated Subsidiaries as at the end of such year and the related audited consolidatedstatements of operations and of cash flows for such year, setting forth in each case in comparative form the figures as of the end of and for theprevious year, reported on without a "going concern" or like qualification or exception, or qualification arising out of the scope of the audit, byErnst & Young LLP or other independent certified public accountants of nationally recognized standing; and

(b) as soon as available, but in any event not later than 60 days after the end of each of the first three quarterly periods of each fiscalyear of Holdings, the unaudited consolidated balance sheet of Holdings and its consolidated Subsidiaries as at the end of such quarter and therelated unaudited consolidated statements of income and of cash flows for such quarter and the portion of the fiscal year through the end ofsuch quarter, setting forth in each case in comparative form the figures as of the end of and for the corresponding period in the previous year,certified by a Responsible Officer as being fairly stated in all material respects (subject to normal year end audit adjustments and the absenceof footnotes);

all such financial statements to be complete and correct in all material respects and to be prepared in reasonable detail and in accordance withGAAP applied consistently throughout the periods reflected therein and with prior periods (except as approved by such accountants or officer,as the case may be, and disclosed therein and subject in the case of financial statements delivered pursuant to Section 6.1(b), normal year endadjustments and the absence of footnotes).

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6.2 Certificates; Other Information. Furnish to the Administrative Agent (which shall in turn be promptly distributed by theAdministrative Agent to each Lender) or, in the case of clause (j), to the relevant Lender:

(a) concurrently with the delivery of the financial statements referred to in Section 6.1(a), a certificate of the independent certifiedpublic accountants reporting on such financial statements stating that in making the examination necessary therefor no knowledge wasobtained of any Default or Event of Default, except as specified in such certificate (it being understood that such certificate shall be limited tothe items that independent certified public accountants are permitted to cover in such certificates pursuant to their professional standards andcustoms of the profession);

(b) concurrently with the delivery of any financial statements pursuant to Section 6.1, (i) a certificate of a Responsible Officer statingthat, to the best of such Responsible Officer's knowledge, no Default or Event of Default has occurred and is continuing except as specified insuch certificate and (ii) (x) a Compliance Certificate containing all information and calculations necessary for determining compliance byHoldings, the Borrower and its Subsidiaries with the provisions of Section 7.1 of this Agreement referred to therein as of the last day of thefiscal quarter or fiscal year of Holdings, as the case may be, (y) to the extent not previously disclosed to the Administrative Agent, in writing,a description of any change in the jurisdiction of organization or formation of any Subsidiary and of any change in the ownership of anySubsidiary, a description of any subscriptions, options, warrants, calls, rights or other agreements or commitments (other than directors'qualifying shares) related to the Capital Stock of any Subsidiary, in each case since the date of the most recent report so delivered since theClosing Date(or, in the case of the first such list so delivered, since the Closing Date) and (z) any UCC financing statements or other filingsspecified in such Compliance Certificate as being required to be delivered therewith;

(c) as soon as available, and in any event no later than 60 days after the end of each fiscal year of Holdings, a detailed consolidatedbudget for the following fiscal year (including a projected consolidated balance sheet of Holdings and its Subsidiaries as of the end of thefollowing fiscal year, and the related consolidated statements of projected cash flow, projected changes in financial position and projectedincome (and a description of the principal underlying assumptions applicable thereto) for such following fiscal year) (collectively, the"Projections"), which Projections shall in each case be accompanied by a certificate of a Responsible Officer stating that such Projections arebased upon good faith estimates and assumptions believed by management of the Borrower to be reasonable at the time made, it beingrecognized by the Lenders that such financial information as it relates to future events is not to be viewed as fact and that actual results duringthe period or periods covered by such financial information may differ from the projected results set forth therein by a material amount;

(d) within five Business Days after delivery thereof, any accountants' letters having substantially similar purpose or effect as thoseletters formerly known as "management letters" that are delivered to the board of directors of Holdings or the Borrower (or their respectiveaudit committees);

(e) no later than five Business Days prior to the effectiveness thereof (or such shorter period agreed to by the Administrative Agent),copies of substantially final drafts of any proposed amendment, supplement, waiver or other modification with respect to the Senior NoteIndenture or the Transaction Documentation;

(f) within five Business Days after the same are sent, copies of all financial statements and reports that Holdings, the Borrower or anyof its Subsidiaries sends to the holders of any class of its debt securities or public equity securities and, within five Business Days after thesame are filed, copies of all financial statements and reports (other than any exhibits thereto and any registration statements on Form S-8 or itsequivalent) that Holdings, the Borrower or any of its Subsidiaries may make to, or file with, the SEC;

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(g) on the Business Day following the occurrence thereof, notice that (i) any or all of the obligations under the Senior Note Indenturehave been accelerated, or (ii) the trustee or the required holders of Senior Notes has given notice that any or all such obligations are to beaccelerated;

(h) to the extent not included in clauses (a) through (g) above, no later than the date the same are required to be delivered thereunder,copies of all agreements, documents or other instruments (including, if any, (i) audited and unaudited, pro forma and other financialstatements, reports, forecasts, and projections, together with any required certifications thereon by independent public auditors or officers ofHoldings, the Borrower or any of its Subsidiaries or otherwise, (ii) press releases, (iii) statements or reports furnished to any other holder ofthe securities of Holdings, the Borrower or any of its Subsidiaries, and (iv) regular, periodic and special securities reports) that Holdings, theBorrower or any of its Subsidiaries is required to provide pursuant to the terms of the Senior Note Documentation;

(i) concurrently with any delivery of financial statements under Section 6.1(a) and (b), a certificate of a Responsible Officer, in formand substance satisfactory to the Administrative Agent, setting forth as of the last Business Day of such fiscal quarter or fiscal year, a true andcomplete list of all Hedge Agreements of the Borrower and each of its Subsidiaries, the material terms thereof (i.e. the type, term, effectivedate, termination date and notional amounts or volumes), the net mark to market value therefor, any credit support agreements relating thereto,any margin required or supplied under any credit support document, and the counterparty to each such agreement; and

(j) promptly, upon receiving from the Lenders such assurances of confidential treatment as the Borrower may reasonably request, suchadditional financial and other information regarding the performance of this Agreement or the financial position or business of Holdings, theBorrower or any of its Subsidiaries, as the Administrative Agent, at the request of any Lender, may from time to time reasonably request.

Information required to be delivered pursuant to Section 6.1 or 6.2 shall be deemed to have been delivered if (i) such information shall havebeen posted by the Administrative Agent on an IntraLinks or similar site to which each Lender has been granted access or (ii) in the case ofSection 6.1 or 6.2(f), such information, or one or more annual or quarterly reports of the Borrower containing such information, shall beavailable on the website of the SEC; provided that the Borrower shall deliver paper copies of such copies to any Lender that requests suchdelivery. Information delivered pursuant to Section 6.1 or 6.2 may also be delivered by electronic communications pursuant to proceduresapproved by the Administrative Agent.

6.3 Payment of Obligations. To the extent not otherwise prohibited hereunder or prohibited by any subordination or intercreditorprovisions thereof, pay, discharge or otherwise satisfy at or before maturity or before they become delinquent, as the case may be, all itsmaterial obligations of whatever nature (not incurred in violation hereof), except where the amount or validity thereof is currently beingcontested in good faith by appropriate proceedings and reserves in conformity with GAAP with respect thereto have been provided on thebooks of Holdings, the Borrower or its Subsidiaries, as the case may be.

6.4 Conduct of Business and Maintenance of Existence, etc. (a) (i) Preserve, renew and keep in full force and effect its corporate orother existence and (ii) take all reasonable action to maintain all rights, privileges, franchises, Permits and licenses necessary or desirable inthe normal conduct of its business, except, in each case, as otherwise permitted by Section 7.4 and except, in the case of clause (ii) above, tothe extent that failure to do so could not reasonably be expected to have a Material Adverse Effect; and (b) comply with (i) all MaterialContractual Obligations and (ii) all Permits and Requirements of Law, except to the extent that failure to comply therewith could not, in theaggregate, reasonably be expected to have a Material Adverse Effect.

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6.5 Maintenance of Property; Insurance.

(a) Keep all Property and systems useful and necessary, in such Person's reasonable business judgment, in its business in good workingorder and condition, ordinary wear and tear and damage caused by casualty excepted.

(b) Maintain with financially sound and reputable insurance companies insurance on all its Property (including, without limitation, allinventory, equipment and vehicles) in at least such amounts and against at least such risks as are usually insured against in the same generalarea by companies engaged in the same or a similar business; and furnish to the Administrative Agent, upon written request, certificatesproviding evidence of such insurance coverage.

(c) Cause the Administrative Agent to be named as a loss payee on all insurance policies of each Loan Party and any Subsidiary thereofcovering any Collateral and cause each such insurance policy to provide that the insurer will give prior notice of any cancellation to theBorrower and (unless such insurer as a matter of its policies generally applicable to insureds is unwilling) to the Administrative Agent. TheBorrower and its Subsidiaries shall bear the risk of loss and shall be responsible for the repair and replacement, if any, of any loss or damageto the insured property. Losses, if any, with respect to said insurance policies shall be adjusted with the respective insurance companies by theBorrower and its Subsidiaries. Any payment under any of said insurance policies shall be directed to be made to the Borrower or itsSubsidiaries, unless (i) an Event of Default has occurred and is continuing and (ii) the Administrative Agent has delivered notice to theBorrower that such payment may not be made to the Borrower or its Subsidiaries.

(d) Deliver to the Administrative Agent on behalf of the Secured Parties, (i) on the Closing Date, a certificate dated such date showingthe amount and types of insurance coverage as of such date, (ii) promptly following receipt of notice from any insurer, a copy of any notice ofcancellation or material change in coverage from that existing on the Closing Date, (iii) promptly, notice of any cancellation or nonrenewal ofcoverage by any Loan Party or Subsidiary thereof, and (iv) promptly after such claim is made by any of the Loan Parties, a description inreasonable detail of any claim for an amount in excess of $5,000,000 with respect to any property and casualty insurance policy maintained byany Loan Party or Subsidiary thereof.

6.6 Inspection of Property; Books and Records; Discussions. (a) Keep proper books of records and account in which full, true andcorrect entries in conformity in all material respects with GAAP and all Requirements of Law shall be made of all dealings and transactions inrelation to its business and activities and (b) permit representatives of any Lender to visit and inspect any of its properties and examine andmake abstracts from any of its books and records at any reasonable time, with reasonable advance notice, and as often as may reasonably bedesired and to discuss the business, operations, properties and financial and other condition of Holdings, the Borrower and its Subsidiarieswith officers and employees of Holdings, the Borrower and its Subsidiaries and with their respective independent certified public accountants,provided that the Administrative Agent or such Lender shall notify the Borrower prior to any contact with such accountants and give theBorrower the opportunity to participate in such discussions and, so long as no Event of Default shall have occurred and be continuing, suchdiscussions with such accountants shall not take place more than once in any calendar year.

6.7 Notices. Give notice to the Administrative Agent and each Lender:

(a) within five Business Days after a Responsible Officer becomes aware of the occurrence of any Default or Event of Default if suchDefault or Event of Default, as applicable, is still continuing;

(b) promptly of any event of default under any Material Indebtedness of Holdings, the Borrower or any of its Subsidiaries;

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(c) promptly of any litigation, or proceeding against or instituted by, Holdings, the Borrower or any of its Subsidiaries (i) if the litigationor proceeding does not involve any Environmental Law, in which the amount involved could reasonably be expected to be $10,000,000 ormore and not covered by insurance, (ii) if the litigation or proceeding involves any Environmental Law, in which the amount involved that isnot covered by insurance could reasonably be expected to be $50,000,000 or more, or (iii) which involves any Loan Document.

(d) within 30 days after a Responsible Officer of Holdings or the Borrower knows thereof: (i) the occurrence of any Reportable Eventwith respect to any Plan, a failure to make any required contribution to a Plan, the creation of any Lien in favor of the PBGC or a Plan or anywithdrawal from, or the termination, Reorganization or Insolvency of, any Multiemployer Plan or (ii) the institution of proceedings or thetaking of any other action by the PBGC or the Borrower or any Commonly Controlled Entity or any Multiemployer Plan with respect to thewithdrawal from, or the termination, Reorganization or Insolvency of, any Plan;

(e) within 30 days after a Responsible Officer of Holdings or the Borrower knows thereof: (i) any Governmental Authority hasidentified Holdings, the Borrower or any of its Subsidiaries as a potentially responsible party with respect to any material liability under anyEnvironmental Law for the cleanup of Materials of Environmental Concern at any location, whether or not owned, leased, or operated by suchPerson, (ii) any Governmental Authority may deny any material Environmental Permit held by, or refuse to renew any material EnvironmentalPermit sought by, Holdings, the Borrower or any of its Subsidiaries or (iii) any property owned, leased, or operated by Holdings, the Borroweror any of its Subsidiaries is being listed on, or proposed for listing on, any list maintained by any Governmental Authority, including theNational Priorities List and the Comprehensive Environmental Response, Compensation and Liability Information System maintained by theU.S. Environmental Protection Agency and any similar list maintained by any other federal, state, local, or other authority; and

(f) promptly of any development or event that has had or could reasonably be expected to have a Material Adverse Effect.

Information required to be delivered pursuant to this Section shall be deemed to have been delivered if such information shall have beenposted by the Administrative Agent on an IntraLinks or similar site to which each Lender has been granted access; provided that the Borrowershall deliver paper copies of such copies to any Lender that requests such delivery. Each notice pursuant to this Section shall be accompaniedby a statement of a Responsible Officer setting forth details of the occurrence referred to therein and stating what action Holdings, theBorrower or the relevant Subsidiary proposes to take with respect thereto.

6.8 Environmental Laws. Except, in each case, where failure to comply could not reasonably be expected to have a Material AdverseEffect:

(a) Comply with, and take all reasonable steps to ensure compliance in all material respects by all tenants and subtenants, if any, with,all applicable Environmental Laws and Environmental Permits, and obtain, maintain, and take all reasonable steps to ensure that tenants andsubtenants obtain and maintain all required Environmental Permits.

(b) Conduct and complete in all material respects all investigations, studies, sampling and testing, and all remedial, removal and otheractions, if any, required under Environmental Laws or Environmental Permits (other than such actions that being challenged in good faith, solong as the pendency of such challenge could not reasonably be expected to have a Material Adverse Effect).

(c) Promptly comply with all orders and directives of all Governmental Authorities regarding Environmental Laws (other than those it ischallenging in good faith, so long as the pendency of such challenges could not reasonably be expected to have a Material Adverse Effect).

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(d) Generate, use, treat, store, release, dispose of, and otherwise manage Materials of Environmental Concern in a manner that could notreasonably be expected to result in a liability to the Borrower or any of its Subsidiaries or to affect any real property owned or leased by any ofthem; and take reasonable efforts to prevent any of its tenants, subtenants, contractors, subcontractors and invitees from generating, using,treating, storing, releasing, disposing of, or otherwise managing Materials of Environmental Concern in a manner that could reasonably beexpected to result in a liability to, or affect any real property owned or operated by, the Borrower or any of its Subsidiaries.

6.9 Additional Collateral, etc. (a) With respect to any Property acquired after the Closing Date by Holdings, the Borrower or anySubsidiary Guarantor that constitutes Collateral described in the Guarantee and Collateral Agreement with respect to such Loan Party (otherthan (w) any real property, (x) any Property described in paragraph (b), (c) and (d) of this Section, (y) any Property subject to a Lien expresslypermitted by Section 7.3(g) and (z) Property acquired by a Special Purpose Subsidiary or an Immaterial Subsidiary) as to which theAdministrative Agent, for the benefit of the Secured Parties, does not have a perfected Lien, promptly (and, in any event, within 30 daysfollowing the date of such acquisition) (i) execute and deliver or cause execution and delivery to the Administrative Agent of suchamendments to the Guarantee and Collateral Agreement or such other documents as the Administrative Agent deems necessary or advisable togrant to the Administrative Agent, for the benefit of the Secured Parties, a security interest in such Property to the extent constitutingCollateral described in the Guarantee and Collateral Agreement with respect to such Loan Party and (ii) take all actions necessary or advisableto grant to the Administrative Agent, for the benefit of the Secured Parties, a perfected first priority security interest in such Property to theextent constituting Collateral described in the Guarantee and Collateral Agreement with respect to such Loan Party (subject only to PermittedLiens), including the filing of UCC financing statements in such jurisdictions as may be required by the Guarantee and Collateral Agreementor by law or as may be reasonably requested by the Administrative Agent.

(b) With respect to any new Subsidiary (other than a Foreign Subsidiary or a Special Purpose Subsidiary) created or acquired after theClosing Date (which, for the purposes of this paragraph, shall include any existing Subsidiary that ceases to be a Foreign Subsidiary or aSpecial Purpose Subsidiary), by Holdings, the Borrower or any of its Subsidiaries, promptly (i) execute and deliver to the AdministrativeAgent such amendments to the Guarantee and Collateral Agreement as the Administrative Agent deems necessary or advisable to grant to theAdministrative Agent, for the benefit of the Secured Parties, a perfected first priority security interest in the Capital Stock of such newSubsidiary that is owned by Holdings, the Borrower or any of its Subsidiaries and required to be pledged pursuant to the Guarantee andCollateral Agreement, (ii) deliver to the Administrative Agent the certificates, if any, representing such Capital Stock, together with undatedstock powers, if applicable, in blank, executed and delivered by a duly authorized officer of Holdings, the Borrower or such Subsidiary, as thecase may be, (iii) unless such Subsidiary is an Immaterial Subsidiary, cause such new Subsidiary (A) to become a party to the Guarantee andCollateral Agreement and (B) to take such actions necessary or advisable to grant to the Administrative Agent for the benefit of the SecuredParties a perfected first priority security interest in the Collateral described in the Guarantee and Collateral Agreement with respect to suchnew Subsidiary as contemplated by the Guarantee and Collateral Agreement, including the filing of UCC financing statements in suchjurisdictions as may be required by the Guarantee and Collateral Agreement or by law or as may be reasonably requested by theAdministrative Agent, and (iv) if requested by the Administrative Agent, deliver to the Administrative Agent legal opinions relating to thematters described above, which opinions shall be in form and substance, and from counsel, reasonably satisfactory to the AdministrativeAgent.

(c) With respect to any new Foreign Subsidiary (other than a Special Purpose Subsidiary) created or acquired after the Closing Date byHoldings, the Borrower or any of its Subsidiaries (other than by any Foreign Subsidiary) (which, for purposes of this paragraph, shall includeany existing Foreign Subsidiary (other than a Special Purpose Subsidiary) that becomes owned by Holdings, the Borrower of any of its

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Subsidiaries (other than any Foreign Subsidiary)), promptly (i) execute and deliver to the Administrative Agent such amendments to theGuarantee and Collateral Agreement or such other documents as the Administrative Agent deems necessary or advisable in order to grant tothe Administrative Agent, for the benefit of the Secured Parties, a perfected first priority security interest in the Capital Stock of such newForeign Subsidiary that is owned by Holdings, the Borrower or any of its Subsidiaries (other than any Foreign Subsidiary) that is required tobe pledged pursuant to the Guarantee and Collateral Agreement (provided that in no event shall more than 65% of the total outstanding votingCapital Stock of any such new Foreign Subsidiary be required to be so pledged), (ii) deliver to the Administrative Agent the certificatesrepresenting such Capital Stock, if any, together with undated stock powers, if applicable in blank, executed and delivered by a dulyauthorized officer of Holdings, the Borrower or such Subsidiary, as the case may be, and take such other action as may be necessary or, in theopinion of the Administrative Agent, desirable to perfect the Lien of the Administrative Agent thereon as contemplated by the Guarantee andCollateral Agreement, and (iii) if requested by the Administrative Agent, deliver to the Administrative Agent legal opinions relating to thematters described above, which opinions shall be in form and substance, and from counsel, reasonably satisfactory to the AdministrativeAgent.

(d) Notwithstanding anything to the contrary herein, in no event shall this Section 6.9 or Section 6.12 require a Lien on any property tothe extent that such grant of a security interest is prohibited by any Requirements of Law of a Governmental Authority, requires a consent notobtained of any Governmental Authority pursuant to such Requirement of Law or is prohibited by, or constitutes a breach or default under orresults in the termination of or requires any consent not obtained under, any contract, license, agreement, instrument or other documentevidencing or giving rise to such property or, in the case of any pledged Capital Stock or promissory notes, any applicable shareholder orsimilar agreement, except to the extent that such Requirement of Law or the term in such contract, license, agreement, instrument or otherdocument or shareholder or similar agreement providing for such prohibition, breach, default or termination or requiring such consent isineffective under applicable law.

(e) With respect to any Subsidiary that ceases to be an Immaterial Subsidiary (other than any Foreign Subsidiary or Special PurposeSubsidiary), promptly (i) cause such Subsidiary to (A) become a party to the Guarantee and Collateral Agreement and (B) to take such actionsnecessary or advisable to grant to the Administrative Agent for the benefit of the Secured Parties a perfected first priority security interest inthe Collateral described in the Guarantee and Collateral Agreement with respect to such Subsidiary as contemplated by the Guarantee andCollateral Agreement, including the filing of UCC financing statements in such jurisdictions as may be required by the Guarantee andCollateral Agreement or by law or as may be reasonably requested by the Administrative Agent, and (ii) if requested by the AdministrativeAgent, deliver to the Administrative Agent legal opinions relating to the matters described above, which opinions shall be in form andsubstance, and from counsel, reasonably satisfactory to the Administrative Agent.

(f) Notwithstanding anything to the contrary in this Section 6.9, paragraphs (a), (b), (c) and (e) of this Section 6.9 shall not apply to anyProperty, new Subsidiary or new Foreign Subsidiary created or acquired, or Subsidiary ceasing to be an Immaterial Subsidiary, after theClosing Date, as applicable, as to which the Administrative Agent has determined in its sole discretion that the collateral value thereof isinsufficient to justify the difficulty, time and/or expense of obtaining a perfected security interest therein.

6.10 Use of Proceeds. Use the proceeds of the Loans only for the purposes specified in Section 4.16.

6.11 ERISA Documents. The Borrower will cause to be delivered to the Administrative Agent, promptly upon the AdministrativeAgent's request, any or all of the following: (i) a copy of each Plan (or, where any such Plan is not in writing, a complete description thereof)and, if applicable, related trust agreements or other funding instruments and all amendments thereto, and any summary plan descriptions andsummaries of material modifications thereof that have been distributed to employees or former employees of the Borrower or any of itsSubsidiaries; (ii) the most recent determination letter, if any,

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issued by the Internal Revenue Service with respect to each Plan; (iii) for the three most recent plan years preceding the AdministrativeAgent's request, Annual Reports on Form 5500 Series required to be filed with any governmental agency for each Plan; (iv) a listing of allMultiemployer Plans, with the aggregate amount of the most recent annual contributions required to be made by the Borrower or anyCommonly Controlled Entity to each such Plan and copies of the collective bargaining agreements requiring such contributions; (v) anyinformation that has been provided to the Borrower or any Commonly Controlled Entity regarding withdrawal liability under anyMultiemployer Plan; (vi) the aggregate amount of payments made under any employee welfare benefit plan (as defined in Section 3(1) ofERISA) to any retired employees of the Borrower or any of its Subsidiaries (or any dependents thereof) during the most recently completedfiscal year; and (vii) documents reflecting any agreements between the PBGC and the Borrower or any Commonly Controlled Entity withrespect to any Plan.

6.12 Further Assurances. (a) From time to time execute and deliver, or cause to be executed and delivered, such additional instruments,certificates or documents, and take all such actions, as the Administrative Agent may reasonably request for the purposes of implementing oreffectuating the provisions of this Agreement and the other Loan Documents, or of more fully perfecting or renewing the rights of theAdministrative Agent and the Lenders with respect to the Collateral (or with respect to any additions thereto or replacements or proceeds orproducts thereof or with respect to any other property or assets hereafter acquired by Holdings, the Borrower or any Subsidiary which may bedeemed to be part of the Collateral) pursuant hereto or thereto.

(b) Preserve and protect the Lien status of each respective Mortgage and, if any Lien (other than Liens permitted under Section 7.3 thatarise by operation of law and other Permitted Liens is asserted against a Mortgaged Property, promptly and at its expense, give theAdministrative Agent a detailed written notice of such Lien and pay the underlying claim in full or take such other action so as to cause it tobe released or bonded over in a manner reasonably satisfactory to the Administrative Agent.

(c) If requested by any Lender or the Administrative Agent, furnish to the Administrative Agent and each Lender a statement to theeffect specified in Section 4.11 in conformity with the requirements of FR Form G-3 or FR Form U 1 referred to in Regulation U.

6.13 Ratings. Take reasonable efforts to cause the Loans at all times to have a publicly available senior secured debt rating from each ofMoody's and S&P.

SECTION 7. NEGATIVE COVENANTS

Holdings and the Borrower hereby jointly and severally agree that, so long as the Commitments remain in effect, any Letter of Creditremains outstanding or any Loan or other amount (excluding Obligations in respect of any Specified Hedge Agreement and unmaturedcontingent reimbursement and indemnification Obligations) is owing to any Lender, any Agent or the Arrangers hereunder, each of Holdingsand the Borrower shall not, and shall not permit any of its Subsidiaries to, directly or indirectly:

7.1 Financial Condition Covenants.

(a) Consolidated Total Leverage Ratio. Permit the Consolidated Total Leverage Ratio as at the last day of any period of fourconsecutive fiscal quarters of Holdings ending with the last day of any fiscal

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quarter in any fiscal year of Holdings listed below to exceed the ratio set forth below opposite such fiscal year:

Fiscal YearLeverage Ratio

Consolidated

Fiscal Year 2006 3.75xFiscal Year 2007 3.50xFiscal Year 2008 3.00xFiscal Year 2009 2.50xFiscal Year 2010 2.50xFiscal Year 2011 2.50x

(b) Consolidated Interest Coverage Ratio. Permit the Consolidated Interest Coverage Ratio for any period of four consecutive fiscalquarters of Holdings ending with the last day of any fiscal quarter in any fiscal year of Holdings listed below to be less than the ratio set forthbelow opposite such fiscal year:

Fiscal YearConsolidated

Interest Coverage Ratio

Fiscal Year 2006 2.00xFiscal Year 2007 3.00xFiscal Year 2008 4.00xFiscal Year 2009 4.00xFiscal Year 2010 4.00xFiscal Year 2011 4.00x

(c) Certain Calculations. With respect to any period during which a Permitted Acquisition or Asset Sale or Investment occurs, forpurposes of determining compliance with the covenants set forth in Section 7.1, Consolidated EBITDA and the components of ConsolidatedTotal Leverage Ratio shall be calculated with respect to such period on a pro forma basis including pro forma adjustments arising out ofevents which are directly attributable to a specific transaction, are factually supportable and are expected to have a continuing impact, in eachcase determined on a basis consistent with Article 11 of Regulation S-X promulgated under the Securities Act of 1933, as amended, and asinterpreted by the staff of the SEC, (which pro forma adjustments shall be certified by the Chief Financial Officer of the Borrower), using thehistorical financial statements of the Person or business acquired or sold or to be acquired or sold and the consolidated financial statements ofthe Borrower and its Subsidiaries which shall be reformulated as if such Permitted Acquisition or Asset Sale, and any Indebtedness or otherliabilities incurred in connection with any such acquisition or sale had been consummated or incurred at the beginning of such period (andassuming that such Indebtedness bears interest during any portion of the applicable measurement period prior to the relevant PermittedAcquisition or Asset Sale, at the weighted average of the interest rates applicable to outstanding Loans during such period; provided that ifsuch assumed Indebtedness is to remain as permanent financing, the actual interest rate will be used in the calculation), all such calculations tobe in form and substance reasonably satisfactory to the Administrative Agent.

7.2 Limitation on Indebtedness. Create, incur, assume or suffer to exist any Indebtedness, except:

(a) Indebtedness of any Loan Party created under any Loan Document (including in respect of any Existing Letters of Credit);

(b) Indebtedness of (i) the Borrower to any Subsidiary Guarantor, (ii) any Subsidiary Guarantor to the Borrower or any SubsidiaryGuarantor, (iii) any Foreign Subsidiary (or KMEMC) to any other Foreign Subsidiary (or KMEMC), and (iv) any Foreign Subsidiary (orKMEMC) to the Borrower or any Subsidiary Guarantor in an aggregate principal amount (for all such Indebtedness permitted pursuant to thisclause (b)(iv)) not to exceed the Foreign Subsidiary Debt Amount (less the aggregate amount of any

61



Cancelled Foreign Debt that was permitted to have been outstanding pursuant to this clause (b)(iv) and that was cancelled pursuant toSection 7.5(k)) at any one time outstanding (provided that all such Indebtedness pursuant to this clause (b)(iv) shall be evidenced by "floatingbalance" promissory notes not requiring notations having terms reasonably satisfactory to Administrative Agent, the sole originally executedcounterparts of which shall be pledged and delivered to Administrative Agent as Collateral);

(c) Indebtedness (including Capital Lease Obligations) secured by Liens permitted by Section 7.3(g) in an aggregate principal amountnot to exceed $25,000,000 at any one time outstanding;

(d) Indebtedness (other than the Indebtedness (x) of Foreign Subsidiaries owing to the Borrower and Subsidiary Guarantors on theClosing Date as specified on Schedule 1.1(b) hereto or (y) referred to in Section 7.2(f)) outstanding on the date hereof and listed onSchedule 7.2(d) and any refinancings, refundings, renewals or extensions thereof (without any increase in the principal amount thereof (otherthan any increase not exceeding the amount of any fees, premium, if any, and financing costs relating to such refinancing) or any shortening ofthe maturity of any principal amount thereof);

(e) (x) Guarantee Obligations made by (i) Holdings or any Subsidiary thereof of any Indebtedness (other than Disqualified Stock) of theBorrower or any Subsidiary Guarantor permitted pursuant to any other clause of this Section 7.2; or (ii) any Foreign Subsidiary of anyIndebtedness of any Foreign Subsidiary permitted pursuant to any other clause of this Section 7.2 (provided that a Subsidiary shall not create,incur, assume or suffer to exist any Guarantee Obligation with respect to any Indebtedness of the Borrower or any Guarantor unless suchSubsidiary shall have also guaranteed the Obligations pursuant to the Guarantee and Collateral Agreement); and (y) any Guarantee Obligationthat is made by Holdings or any Subsidiary thereof with respect to any Indebtedness of any Foreign Subsidiary (or KMEMC) permitted underSection 7.2(r) or (s);

(f) (i) Indebtedness of the Borrower and Tronox Finance in respect of the Senior Notes; (ii) Guarantee Obligations of Holdings and anySubsidiary Guarantor in respect of such Indebtedness; and (iii) unsecured indebtedness of the Borrower and/or Tronox Finance that refinancesthe Senior Notes and Guarantee Obligations of Holdings and any Subsidiary Guarantor in respect of such refinancing indebtedness; providedthat (A) the maturity date of such refinancing Indebtedness shall be no earlier than six months after the Tranche A Term Loan Maturity Date,(B) the covenants and defaults, taken as a whole, contained in the documents, instruments and agreements governing or evidencing suchrefinancing Indebtedness ("Senior Note Refinancing Documents") shall be no less favorable to the Borrower and the Guarantors than theterms of the Senior Notes and (C) the principal amount of such refinancing Indebtedness (net of any fees, premium, if any, and financing costsrelated thereto) does not exceed the principal amount of the Senior Notes refinanced thereby;

(g) Indebtedness of a Person at the time such Person becomes a Subsidiary of the Borrower, or is merged or consolidated with or intothe Borrower of any of its Subsidiaries in a transaction permitted under this Agreement, in an aggregate principal amount not to exceed$25,000,000 at any one time outstanding for all Indebtedness incurred pursuant to this clause (g), and extensions, renewals, refinancings,refundings and replacements of any such Indebtedness that do not increase the outstanding principal amount thereof (other than any increasenot exceeding the amount of any fees, premium, if any, and financing costs relating to such refinancing); provided that (i) such Indebtedness(other than any such extension, renewal, refinancing, refunding or replacement) exists at the time such Person becomes a Subsidiary and is notcreated in contemplation of such event, (ii) other than the Guarantee Obligations permitted by paragraph (e) of this Section 7.2, neitherHoldings nor any of its other Subsidiaries shall be liable for such Indebtedness and (iii) Holdings is in compliance, on a pro forma basis aftergiving effect to the incurrence of such Indebtedness and the use of proceeds thereof, with the covenants contained in Section 7.1, in each caserecomputed as at the last day of the most recently ended fiscal quarter of the Holdings for which the relevant information is available as ifsuch incurrence had occurred on the first day of each relevant period for testing such compliance;

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(h) obligations of a Special Purpose Subsidiary incurred and outstanding pursuant to a Receivable Financing Transaction permitted bySection 7.5(l) that are not recourse to Holdings, the Borrower or any other Subsidiary of the Borrower (other than pursuant to StandardSecuritization Undertakings (it being understood and agreed that to the extent such Standard Securitization Undertakings constitute GuaranteeObligations or Indebtedness such Standard Securitization Undertakings shall be permitted under this Section 7.2 and 7.8);

(i) Indebtedness of the Borrower or any Subsidiary to the seller representing all or part of the purchase price of an Investment oracquisition permitted hereunder, or assumed by the Borrower or any of its Subsidiaries in connection therewith, and extensions, renewals,refinancings, refundings and replacements of any such Indebtedness that do not increase the outstanding principal amount thereof (other thanany increase not exceeding the amount of any fees, premium, if any, and financing costs relating to such refinancing), provided that (i) as toany such assumed Indebtedness, such Indebtedness (other than any extension, renewal, refinancing, refunding or replacement thereof) exists atthe time of such acquisition and is not created in contemplation of such event and (ii) the aggregate principal amount of all such Indebtednessshall not exceed $50,000,000 at any one time outstanding for all Indebtedness incurred pursuant to this clause (i);

(j) Indebtedness arising from judgments or orders in circumstances not constituting an Event of Default;

(k) Indebtedness resulting from the endorsement of negotiable instruments in the ordinary course of business or arising from thehonoring of a check, draft or similar instrument presented by Holdings or any of its Subsidiaries in the ordinary course of business againstinsufficient funds;

(l) Indebtedness in respect of (i) workers' compensation claims and self-insurance obligations in the ordinary course of business, (ii) thefinancing of insurance premiums in customary amounts consistent with the operations and businesses of the Borrower and its Subsidiaries and(iii) surety, appeal and performance bonds, provided that such bonds are entered into in the ordinary course of business and are not in respectof Indebtedness;

(m) Indebtedness arising from or representing deferred compensation to employees of Holdings or its Subsidiaries that constitute or aredeemed to be Indebtedness under GAAP and that are incurred in the ordinary course of business;

(n) Indebtedness of the Borrower and/or Tronox Finance (including any Indebtedness of the Borrower and/or Tronox Finance thatextends, renews, refinances, refunds, replaces or is in exchange for existing Indebtedness of the Borrower and/or Tronox Finance permitted bythis paragraph) and Guarantee Obligations of any Guarantors in respect of such Indebtedness, provided that, with respect to all Indebtednesspermitted by this paragraph (n) (including (except in the case of clause (vi) below) any extension, renewal, refinancing, refunding orreplacement thereof), (i) such Indebtedness is unsecured, (ii) such Indebtedness has no scheduled principal payments prior to the date that issix months after the Tranche A Term Loan Maturity Date, (iii) the covenants and defaults, taken as a whole, contained in the documents,instruments and agreements governing or evidencing such Indebtedness (the "Senior Unsecured Debt Documents") are no more restrictivethan those applicable to offerings of "high-yield" debt by similar issuers of similar debt at or about the same time (but in any event no morerestrictive than this Agreement and not including (x) financial maintenance covenants or (y) defaults (other than cross-defaults arising fromnon-payment of Indebtedness after the expiration of any applicable grace period) arising from defaults under documentation governing otherIndebtedness unless such other Indebtedness is accelerated), (iv) no Default or Event of Default has occurred and is continuing or would resultfrom the Incurrence of such Indebtedness, (v) Holdings is in compliance, on a pro forma basis after giving effect to the incurrence of suchIndebtedness and the use of proceeds thereof, with the covenants contained in Section 7.1, in each case recomputed as at the last day of themost recently ended fiscal quarter of Holdings for which the relevant information is available as if such incurrence had occurred on the firstday

63



of each relevant period for testing such compliance, (vi) the Net Cash Proceeds of the incurrence of such Indebtedness are applied inaccordance with Section 2.12(a) and (vii) the aggregate principal amount of such Indebtedness incurred the Net Cash Proceeds of which arenot applied to the prepayment of the Tranche A Term Loans under Section 2.12(a), shall not exceed $100,000,000;

(o) subordinated Indebtedness of the Borrower and/or Tronox Finance (including any subordinated Indebtedness of the Borrower and/orTronox Finance that extends, renews, refinances, refunds, replaces or is in exchange for existing subordinated Indebtedness of the Borrowerand/or Tronox Finance permitted by this paragraph) and Guarantee Obligations of any Guarantor in respect of such Indebtedness, providedthat, with respect to all Indebtedness permitted by this paragraph (o) (including (except in the case of clause (vii) below) any extension,renewal, refinancing, refunding or replacement thereof), (i) such Indebtedness is unsecured, (ii) such Indebtedness has no scheduled principalpayments prior to the date that is six months after the Tranche A Term Loan Maturity Date, (iii) the covenants and defaults, taken as a whole,contained in the documents, instruments and agreements governing or evidencing such Indebtedness (the "Subordinated Debt Documents")are no more restrictive than those applicable to offerings of "high-yield" subordinated debt by similar issuers of similar debt at or about thesame time (but in any event no more restrictive than this Agreement and not including (x) financial maintenance covenants or (y) defaults(other than cross-defaults arising from non-payment of Indebtedness after the expiration of any applicable grace period) arising from defaultsunder documentation governing other Indebtedness unless such other Indebtedness is accelerated), (iv) the Subordinated Debt Documentscontain subordination terms that are no less favorable in any material respect to the Lenders than those applicable to offerings of "high-yield"subordinated debt by similar issuers of similar debt at or about the same time, (v) no Default or Event of Default has occurred and iscontinuing or would result from the Incurrence of such Indebtedness, (vi) Holdings is in compliance, on a pro forma basis after giving effect tothe incurrence of such Indebtedness and the use of proceeds thereof, with the covenants contained in Section 7.1, in each case recomputed asat the last day of the most recently ended fiscal quarter of Holdings for which the relevant information is available as if such incurrence hadoccurred on the first day of each relevant period for testing such compliance, (vii) the Net Cash Proceeds of the incurrence of suchIndebtedness are applied in accordance with Section 2.12(a) and (viii) the aggregate principal amount of any such Indebtedness incurred theNet Cash Proceeds of which are not applied to the prepayment of the Tranche A Term Loans under Section 2.12(a) shall not exceed$250,000,000;

(p) Disqualified Stock of Holdings or the Borrower, provided that, at the time of issuance thereof, (i) no Default or Event of Default hasoccurred and is continuing or would result therefrom, (ii) Holdings is in compliance, on a pro forma basis after giving effect to such issuanceand the use of proceeds thereof, with the covenants contained in Section 7.1, in each case recomputed as at the last day of the most recentlyended fiscal quarter of Holdings for which the relevant information is available as if such issuance had occurred on the first day of eachrelevant period for testing such compliance, and (iii) the Net Cash Proceeds of such issuance are applied in accordance with Section 2.12(a);

(q) Indebtedness arising pursuant to clause (i) of the definition thereof as a result of Liens permitted under Section 7.3(a), (b), (c), (d),(i) and (o);

(r) Indebtedness of Foreign Subsidiaries (other than Indebtedness permitted by other clauses of this Section 7.2), which, when incurredand aggregated with the then outstanding principal amount of all other Indebtedness of Foreign Subsidiaries incurred pursuant to thisSection 7.2(r), shall not exceed the greater of (i) $30,000,000 and (b) 5.0% of the combined Consolidated Tangible Assets of the ForeignSubsidiaries (as of the most recently ended fiscal quarter for which financial statements have been delivered pursuant to Section 6.1) (less theaggregate amount of any Cancelled Foreign Debt that was permitted to have been outstanding pursuant to this clause (r) and that wascancelled pursuant to Section 7.5(k));

(s) additional Indebtedness of the Borrower or any of its Subsidiaries in an aggregate principal amount (for the Borrower and allSubsidiaries) not to exceed $35,000,000 at any one time outstanding; and

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(t) Indebtedness of Holdings to the Borrower incurred pursuant to the last sentence of Section 7.6 in lieu of Restricted Paymentsotherwise permitted under Section 7.6(d), (e), (f) or (l)(ii).

7.3 Limitation on Liens. Create, incur, assume or suffer to exist any Lien upon any of its Property, whether now owned or hereafteracquired, except for:

(a) (i) Liens for taxes, assessments or other governmental charges not yet due or which are being contested in good faith by appropriateproceedings, provided that adequate reserves with respect thereto are maintained on the books of the Borrower or its Subsidiaries, as the casemay be, in conformity with GAAP and (ii) Liens in favor of customs and revenue authorities arising as a matter of law to secure payments ofcustoms duties in connection with the importation of goods;

(b) statutory landlord's liens, vendors', carriers', warehousemen's, mechanics', materialmen's, repairmen's, suppliers', workers'construction or other like Liens arising in the ordinary course of business;

(c) pledges or deposits in connection with workers' compensation, unemployment insurance and other social security, old age pension orpublic liability obligations or any other liabilities of like nature;

(d) deposits of cash or securities by or on behalf of the Borrower or any of its Subsidiaries to secure the performance of letters of intentor purchase agreements permitted under this Agreement, bids, tenders, trade contracts (other than for borrowed money), government contracts,leases, statutory obligations, regulatory obligations, surety and appeal bonds, performance and return of money bonds and other obligations ofa like nature;

(e) easements, rights-of-way, restrictions, servitudes, permits, conditions, covenants and other similar encumbrances incurred in theordinary course of business which, in the aggregate, do not materially detract from the value of the Property subject thereto or materiallyinterfere with the ordinary conduct of the business of the Borrower and of its Subsidiaries, taken as a whole;

(f) Liens in existence on the date hereof listed on Schedule 7.3(f), securing Indebtedness permitted by Section 7.2(d) or otherobligations (not constituting Indebtedness) of the Borrower and its Subsidiaries, provided that no such Lien is spread to cover any additionalProperty after the Closing Date (other than after acquired title in or on such property and proceeds of the existing collateral in accordance withthe instrument creating such Lien (without any modification thereof after the Closing Date)) and that, to the extent such Liens secureIndebtedness, the amount of Indebtedness secured thereby is not increased except (A) as permitted by Section 7.2(d) and (B) pursuant to theinstrument creating such Lien (without any modification thereof after the Closing Date);

(g) Liens securing Indebtedness of the Borrower or any of its Subsidiaries incurred pursuant to Section 7.2(c) to finance the acquisition,construction or improvement of fixed or capital assets, provided that (i) such Liens shall be created within 365 days of the acquisition,construction or improvement of such fixed or capital assets, (ii) such Liens do not at any time encumber any Property other than the Propertyfinanced by such Indebtedness, (iii) the amount of Indebtedness secured thereby is not increased and (iv) the amount of Indebtedness initiallysecured thereby is not more than 100% of the purchase price of such fixed and capital assets;

(h) Liens created pursuant to the Security Documents;

(i) any interest or title of a lessor under any lease entered into by the Borrower or any of its Subsidiaries and covering only the assets soleased;

(j) Liens consisting of customary rights of set-off of or banker's liens on amounts on deposit at banks, to the extent arising by operationof law or otherwise, incurred in the ordinary course of business;

(k) Liens on the assets of a Person at the time such Person becomes a Subsidiary of the Borrower, or is merged or consolidated with orinto the Borrower or a Subsidiary thereof, in a transaction permitted by this Agreement; provided that (i) such Liens shall not be created incontemplation of such event, (ii) such Liens do not at any time encumber any property other than such assets and (iii) such Liens may secureextensions, renewals, refinancings, refundings and replacements of any Indebtedness of such Person permitted under Section 7.2(g);



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(l) Liens existing on any asset prior to the acquisition thereof by the Borrower or any of its Subsidiaries in a transaction permitted bythis Agreement, provided that (i) such Liens shall not be created in contemplation of such event, (ii) such Liens do not at any time encumberany property other than such asset and (iii) such Liens may secure extensions, renewals, refinancings, refundings and replacements of anyIndebtedness in respect of such asset permitted under Section 7.2(i);

(m) any obligations or duties affecting any of the property of the Borrower or its Subsidiaries to any municipality or public authority orGovernmental Authority with respect to any franchise, grant, license or Permit;

(n) (i) Liens arising from precautionary Uniform Commercial Code financing statement filings with respect to operating leases orconsignment arrangements entered into by the Borrower or any of its Subsidiaries in the ordinary course of business or Liens on propertywhich is the subject of a Disposition permitted by Section 7.5 relating to such Disposition (so long such Liens are not perfected prior to thecompletion of such Disposition) and (ii) Liens encumbering property or assets under construction in the ordinary course of business forpurchase by a customer from Borrower or its Subsidiaries arising from progress or partial payments by such customer to the Borrower or itsSubsidiaries relating solely to such property or assets;

(o) Liens on property of the Borrower or any of its Subsidiaries in favor of others securing licenses, subleases and leases permittedhereunder and granted to others and not interfering in any material respect in the business of the Borrower or any of its Subsidiaries;

(p) judgment and attachment Liens not constituting an Event of Default;

(q) Liens on Receivables Assets of a Special Purpose Subsidiary subject to a Receivable Financing Transaction permitted bySection 7.5(l);

(r) Liens on any assets of a Foreign Subsidiary securing Indebtedness incurred pursuant to Section 7.2(r) and Section 7.2(s);

(s) Liens not otherwise permitted by this Section 7.3 so long as the aggregate principal amount of the obligations secured thereby doesnot exceed (as to the Borrower and all Subsidiaries) $15,000,000 at any one time outstanding; and

(t) Liens to secure obligations under commodity Hedge Agreements permitted under Sections 7.8(n) and 7.20 provided that the amountof cash and the fair market value of the Property, other than cash, that is subject to the Liens permitted by this Section 7.3(t) shall not exceed$10,000,000 in the aggregate at any one time outstanding.

7.4 Limitation on Fundamental Changes. Enter into any merger, consolidation or amalgamation, or liquidate, wind up or dissolveitself (or suffer any liquidation or dissolution), or Dispose of all or substantially all of its Property or business, except that:

(a) any Subsidiary of the Borrower may be merged or consolidated (x) with or into the Borrower (provided that the Borrower shall bethe continuing or surviving corporation) or with or into any Subsidiary Guarantor (provided that (i) such Subsidiary Guarantor shall be thecontinuing or surviving corporation or (ii) simultaneously with such transaction, the continuing or surviving corporation shall become aSubsidiary Guarantor and the Borrower shall comply with Section 6.9 in connection therewith) or (y) with or into any Subsidiary (providedthat neither Subsidiary is a Subsidiary Guarantor);

(b) any Subsidiary of the Borrower may Dispose of any or all of its assets (i) to the Borrower or any Subsidiary Guarantor (uponvoluntary liquidation or otherwise), (ii) to any other Subsidiary (provided that neither Subsidiary is a Subsidiary Guarantor) (upon voluntaryliquidation or otherwise) or (iii) pursuant to a Disposition permitted by Section 7.5;

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(c) the Capital Stock of any Subsidiary of the Borrower may be transferred to the Borrower or any Subsidiary Guarantor or, in the caseof any Capital Stock of any Subsidiary that is not a Subsidiary Guarantor, to any Subsidiary; and

(d) any Investment expressly permitted by Section 7.8, or Disposition expressly permitted by Section 7.5, may be structured as amerger, consolidation or amalgamation.

7.5 Limitation on Disposition of Property. Dispose of any of its Property (including receivables and leasehold interests), whether nowowned or hereafter acquired, or, in the case of any Subsidiary of Holdings, issue or sell any shares of such Subsidiary's Capital Stock to anyPerson, except:

(a) the Disposition of (i) obsolete or worn out Property in the ordinary course of business or (ii) Property that is no longer useful in theconduct of the Borrower's business in the ordinary course of such business, provided that, in the case of clause (ii), an amount equal to the NetCash Proceeds thereof is applied as and to the extent required by Section 2.12(b);

(b) the sale of inventory in the ordinary course of business;

(c) Dispositions permitted by Section 7.4(a) or (c) or clauses (i) and (ii) of Section 7.4(b);

(d) the sale or issuance of (i) any Subsidiary's Capital Stock to (x) the Borrower or any Subsidiary Guarantor or (y) any other Subsidiary(provided that neither Subsidiary is a Subsidiary Guarantor) or (ii) Capital Stock (other than Disqualified Stock) of the Borrower to Holdings,in each case in a transaction expressly permitted by Section 7.8;

(e) the Disposition by the Borrower and its Subsidiaries of other assets having a fair market value not to exceed $35,000,000 in theaggregate for any fiscal year of the Borrower provided that at least 75% of the consideration received in respect thereof shall be in the form ofcash and Cash Equivalents;

(f) (i) the Disposition of any Investment made pursuant to Section 7.8(b), (h), or (n) or (ii) the Disposition of any Investment permittedpursuant to Section 7.8(i); provided that in the case of clause (ii), unless such Investment permitted under Section 7.8(i) was acquired in aDisposition under a clause specified in the parenthetical of the definition of "Asset Sale", an amount equal to the Net Cash Proceeds of suchDisposition is applied as and to the extent required by Section 2.12(b);

(g) Dispositions resulting from a Recovery Event, provided, that the requirements of Section 2.12(b) are complied with in connectiontherewith;

(h) (i) the discount, write-off or sale of overdue accounts receivables and (ii) the factoring at maturity or collection of any accountreceivables, in each case in the ordinary course of business;

(i) the lease or license (or sublease or sublicense) of real or personal property (including Intellectual Property) in the ordinary course ofbusiness;

(j) the sale or exchange of specific items of Property, so long as the purpose of each such sale or exchange is to acquire (and resultswithin 365 days of such sale or exchange in the acquisition of) replacement items of Property which are, in the reasonable business judgmentof the Borrower, the functional equivalent of the items of Property so sold or exchanged;

(k) the cancellation of any Indebtedness constituting an Investment permitted pursuant to Section 7.8 (other than any Indebtedness ofany Foreign Subsidiary to the Borrower or any Subsidiary Guarantor (other than any such Indebtedness cancelled in connection with the saleof such Foreign Subsidiary to a Person other than the Borrower and its Subsidiaries) (any such cancelled Indebtedness of a ForeignSubsidiary, "Cancelled Foreign Debt")) which the Borrower reasonably believes to be uncollectible;



(l) the sale, contribution, transfer or other Disposition of Receivables Assets to a Special Purpose Subsidiary for the fair market value ofthose assets, less amounts required to be established as reserves and

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customary discounts pursuant to contractual agreements with entities that are not Affiliates of the Borrower, entered into as part of aReceivable Financing Transaction, so long as no Event of Default under Section 8(a) or 8(f) has occurred and is continuing at the time of suchDisposition;

(m) the Disposition of Receivables Assets by a Special Purpose Subsidiary in a Receivable Financing Transaction;

(n) issuances of Stock by a Special Purpose Subsidiary to the Borrower or a Subsidiary in connection with a Receivable FinancingTransaction;

(o) Dispositions permitted by Section 7.11, provided that (i) at least 75% of the consideration received in respect thereof shall be in theform of cash and Cash Equivalents and (ii) an amount equal to the Net Cash Proceeds thereof is applied as and to the extent required bySection 2.12(b); and

(p) issuances by the Borrower or Holdings of its Disqualified Stock permitted by Section 7.2(p); and

(q) Dispositions of the Electrolytic Assets; provided that (i) at least 75% of the consideration received in respect thereof shall be in theform of cash and Cash Equivalents, (ii) an amount equal to the Net Cash Proceeds thereof is applied as and to the extent required bySection 2.12(b) and (iii) Holdings is in compliance, on a pro forma basis after giving effect to such Disposition and the use of proceedsthereof, with the covenants contained in Section 7.1, in each case recomputed as at the last day of the most recently ended fiscal quarter ofHoldings for which the relevant information is available as if such incurrence had occurred on the first day of each relevant period for testingsuch compliance.

7.6 Limitation on Restricted Payments. Declare or pay any dividend (other than dividends payable solely in Capital Stock (excludingDisqualified Stock) of the Person making such dividend) on, or make any payment on account of, or set apart assets for a sinking or otheranalogous fund for, the purchase, redemption, defeasance, retirement or other acquisition of, any Capital Stock of Holdings, the Borrower orany of its Subsidiaries, whether now or hereafter outstanding, or make any other distribution in respect thereof, either directly or indirectly,whether in cash or property or in obligations of Holdings, the Borrower or any of its Subsidiaries (other than payments solely in Capital Stock(excluding Disqualified Stock) of the Person), or enter into any derivatives or other transaction with any financial institution, commodities orstock exchange or clearinghouse (a "Derivatives Counterparty") obligating Holdings, the Borrower or any Subsidiary to make payments tosuch Derivatives Counterparty as a result of any change in market value of any such Capital Stock (collectively, "Restricted Payments"),except that:

(a) any Subsidiary may make Restricted Payments to the Borrower or any Subsidiary Guarantor (or, if such Subsidiary is not aSubsidiary Guarantor, to any Subsidiary);

(b) any non-Wholly Owned Subsidiary may make Restricted Payments ratably with respect to its Capital Stock;

(c) Holdings may make Restricted Payments in the form of Capital Stock (other than Disqualified Stock) of Holdings;

(d) the Borrower may pay dividends to Holdings to permit Holdings to pay, and Holdings may pay, dividends to shareholders ofHoldings not to exceed $5,000,000 in the aggregate in any fiscal quarter so long as, at the time of declaration, and, if paid more than 60 daysafter the date of declaration, the time of payment, (x) no Event of Default is continuing and (y) if the Total Revolving Commitments have notbeen terminated or expired, the excess of the Total Revolving Credit Commitments at such time over the aggregate Revolving Extensions ofCredit at such time is equal to or greater than the amount of such dividend;

(e) Holdings, the Borrower and its Subsidiaries may make Restricted Payments pursuant to and in connection with stock option plans orother benefit plans or arrangements involving Capital Stock of Holdings or options for Capital Stock of Holdings established for directors,officers, employees or

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consultants of Holdings, the Borrower and its Subsidiaries, provided, that the aggregate amount of payments under this clause (e) subsequentto the Closing Date (net of any proceeds received by Holdings subsequent to the date hereof in connection with resales of any Capital Stock ofHoldings or options for Capital Stock of Holdings so purchased) shall not exceed $5,000,000 in any twelve-month period (with unusedamounts in any twelve-month period being carried over to the next (and only the next) succeeding twelve month period);

(f) the Borrower may pay dividends to Holdings to permit Holdings to (i) pay corporate overhead, legal, accounting and administrativeexpenses incurred in the ordinary course of business not to exceed $3,000,000 in any fiscal year, (ii) pay franchise taxes and other taxobligations or fees required in each case to maintain its corporate existence and (iii) pay any taxes which are due and payable by Holdings andthe Borrower as part of a consolidated group or due to ownership of any interests in Subsidiaries that are not treated as corporations forapplicable tax purposes;

(g) Holdings may effect repurchases of Capital Stock of Holdings upon the exercise of stock options or warrants or vesting of restrictedstock to the extent deemed to occur on the non-cash exercise of permitted stock options and warrants or the withholding obligations withrespect to such exercise or vesting;

(h) Holdings may repurchase or exchange its Capital Stock to the extent funded with Net Cash Proceeds which are received from andsubstantially concurrently with the issuance of its Capital Stock;

(i) Holdings may make Restricted Payments in any fiscal year financed solely with the proceeds of an issuance of Capital Stock ofHoldings (subject to Section 8(k)) to the extent such proceeds have not been used for other purposes hereunder;

(j) Holdings may (and, to the extent of the portion of the Distribution constituting net proceeds of borrowings under the Tranche ATerm Loan and the Senior Notes, the Borrower may pay a dividend to Holdings to permit Holdings to) effect the Distribution on the ClosingDate (and other Restricted Payments, to the extent of the net proceeds of sale of common stock of Holdings in the IPO pursuant to an over-allotment option, within 45 days thereafter);

(k) the Borrower and its Subsidiaries may make Restricted Payments constituting purchases by (i) the Borrower or any SubsidiaryGuarantor of the Capital Stock of any Subsidiary of the Borrower or (ii) any Subsidiary that is not a Subsidiary Guarantor of any otherSubsidiary's Capital Stock, in each case, pursuant to a transaction expressly permitted by Section 7.8; and

(l) (i) the Borrower or Holdings may declare and pay quarterly dividends on its Disqualified Stock permitted by Section 7.2(p) in theordinary course of business; and (ii) Borrower may declare and pay dividends to Holdings to permit Holdings to pay dividends permittedunder clause (i) above, provided that, in case of clauses (i) and (ii), at the time of declaration of such dividend, no Default or Event of Defaultshall have occurred and be continuing or would result therefrom.

Any Restricted Payment by Borrower to Holdings otherwise permitted by clauses (d), (e), (f) or (l)(ii) of this Section 7.6 may be effected inthe form of an advance by Borrower to Holdings; provided that the amount of such advance shall thereafter be deemed and treated as a"dividend" and "Restricted Payment" for purposes of the limitations specified in clauses (d), (e), (f) and (l)(ii) of this Section 7.6.

7.7 Limitation on Capital Expenditures. Make or commit to make any Capital Expenditure, except (a) expenditures in respect ofCapital Lease Obligations permitted by Section 7.2(c) and (b) other (i) Capital Expenditures of the Borrower and its Subsidiaries funded bythe proceeds of an issuance of Capital Stock of Holdings (subject to Section 8(k)) to the extent such proceeds have not been used for otherpurposes hereunder or (ii) Capital Expenditures of the Borrowers and its Subsidiaries not exceeding in any fiscal year the amount set forth inSchedule 7.7 for such fiscal year; provided, that (x) up to 50% of any such amount referred to above in clause (b)(ii), if not so expended in thefiscal year for which it is

69



permitted, may be carried over for expenditure in the next succeeding fiscal year and (y) Capital Expenditures made pursuant toclause (b)(ii) during any fiscal year shall be deemed made, first, in respect of amounts permitted for such fiscal year as provided above andsecond, in respect of amounts carried over from the prior fiscal year pursuant to subclause (x) above.

7.8 Limitation on Investments. Make any advance, loan, extension of credit or capital contribution to, or purchase any Capital Stock,bonds, notes, debentures or other debt securities of, or any assets substantially constituting an ongoing business from, or make any otherinvestment in, any other Person (all of the foregoing, "Investments"), except:

(a) extensions of trade credit in the ordinary course of business;

(b) Investments in Cash Equivalents;

(c) Guarantee Obligations permitted by Section 7.2;

(d) loans and advances to employees of Holdings, the Borrower or any Subsidiaries of the Borrower in the ordinary course of business(including for travel, entertainment and relocation expenses) in an aggregate amount for Holdings, the Borrower and Subsidiaries of theBorrower not to exceed $1,000,000 at any one time outstanding;

(e) Investments made with the proceeds of any Reinvestment Deferred Amount;

(f) Investments by (i) Holdings, the Borrower or any of its Subsidiaries in the Borrower or any Subsidiary Guarantor; (ii) anySubsidiary that is not a Subsidiary Guarantor in any other Subsidiary; and (iii) Investments by the Borrower or any Subsidiary Guarantor inany Foreign Subsidiary (or KMEMC) in an aggregate amount (for all Investments permitted pursuant to this clause (f)(iii)) not to exceed$25,000,000 (less the aggregate amount of any Cancelled Foreign Debt that was permitted to have been outstanding pursuant to thisclause (f)(iii) and that was cancelled pursuant to Section 7.5(k)) at any one time outstanding;

(g) in addition to Investments otherwise expressly permitted by this Section, Investments by the Borrower or any Subsidiary thereofconstituting an acquisition of any Person engaged primarily in, or assets substantially constituting an ongoing business consisting primarily of,one or more lines of businesses permitted under Section 7.15 ("Permitted Acquisitions"); provided that:

(i) immediately prior to and after giving affect to any such Permitted Acquisition, no Default or Event of Default shall haveoccurred and be continuing and the Borrower shall have certified the same to the Administrative Agent in writing;

(ii) if such Permitted Acquisition is structured as a stock acquisition, then either (A) the Person so acquired becomes aSubsidiary of Borrower or (B) such Person is merged with and into either the Borrower or a Subsidiary thereof (with the Borroweror such Subsidiary being the surviving Person in such merger);

(iii) all of the provisions of Section 6.9 have been or will be complied with in all material respects in respect of such PermittedAcquisition;

(iv) after giving pro forma effect to the proposed Permitted Acquisition in accordance with Section 7.1(e), the Borrower shallbe in compliance with the financial covenants set forth in Section 7.1;

(v) the consideration for such Permitted Acquisition shall be limited to a maximum amount of $25,000,000 per PermittedAcquisition and $75,000,000 for all Permitted Acquisitions during the term of this Agreement; provided, however, that in each case,such calculation shall exclude any portion of consideration funded with the proceeds of the issuance of Capital Stock of Holdings(subject to

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Section 8(k)) (to the extent such proceeds have not been used for other purposes hereunder) or consisting of the issuance of suchCapital Stock of Holdings to the seller; and

(vi) any Indebtedness of the Borrower or any Subsidiary thereof (including any Person becoming a Subsidiary of Borrower asa result of such Permitted Acquisition) that exists immediately after consummation of such Permitted Acquisition is permitted underSection 7.2;

(h) Investments received in connection with the bankruptcy or reorganization of, or settlement of delinquent accounts and disputes with,customers and suppliers;

(i) the Borrower and its Subsidiaries may receive and own securities or other Investments acquired pursuant to Dispositions, mergers,consolidations, amalgamations, liquidations, wind-ups or dissolutions permitted pursuant to Sections 7.4 or 7.5, provided that, if any suchInvestment constitutes an Investment by any Loan Party in a Foreign Subsidiary, such Investment is permitted pursuant to clause (f)(iii) orclause (s) of this Section 7.8;

(j) Investments consisting of endorsements for collection or deposit in the ordinary course of business;

(k) Investments in deposit accounts opened and maintained in the ordinary course of business;

(l) Investments made using the Capital Stock of Holdings (subject to Section 8(k)) or the proceeds received by Holdings any of itsSubsidiaries from the issuance of Capital Stock of Holdings (subject to Section 8(k)) to the extent such proceeds have not been used for otherpurposes hereunder, provided that, after giving pro forma effect to the proposed Investment in accordance with Section 7.1(c), the Borrowershall be in compliance with the financial covenants set forth in Section 7.1;

(m) Investments (other than Investments by any Loan Party in any Foreign Subsidiary) in existence on the Closing Date and, in the caseof any Investment in excess of $25,000,000, listed on Schedule 7.8(m), and extensions, renewals, modifications, or restatements orreplacements thereof, provided that no such extension, renewal, modification, restatement or replacement shall (i) increase the amount of theoriginal Investment or (ii) adversely affect the interests of the Lenders with respect to such original Investment, or the interests of the Lendersunder this Agreement and the other Loan Documents, in any material respect;

(n) Investments in Hedge Agreements relating to the businesses and finances of the Borrower in or any of its Subsidiaries and not forpurposes of speculation;

(o) Investments by the Borrower or any of its Subsidiaries in joint ventures engaged primarily in one or more businesses in which theBorrower and its Subsidiaries are engaged or generally related thereto in an aggregate amount (valued at cost, without regard to any write-upsor write-downs thereof) not to exceed $10,000,000 in any fiscal year of Holdings; provided that, at the time of and after giving effect to suchInvestments, no Default or Event of Default shall have occurred and be continuing or would result therefrom;

(p) Investments permitted by Section 7.2(e), 7.2(q), 7.6 (other than clause (k) thereof) and 7.7;

(q) any Investment by the Borrower or a Subsidiary of the Borrower in a Special Purpose Subsidiary, or any Investment by a SpecialPurpose Subsidiary in any other Person, in each case in connection with a Receivables Financing Transaction and in a manner, and forconsideration, customary for transactions of that type;

(r) in addition to Investments otherwise expressly permitted by this Section, Investments by the Borrower or any of its Subsidiaries(other than in Holdings) in an aggregate amount not to exceed $25,000,000 at any one time outstanding;

(s) Investments constituting Indebtedness of any Foreign Subsidiary (or KMEMC) to the Borrower or any Subsidiary Guarantorpermitted pursuant to Section 7.2(b)(iv) or Section 7.2(r) or (s); and



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(t) Investments constituting Indebtedness of Holdings to the Borrower permitted pursuant to Section 7.2(t).

The outstanding amount of any Investment on any date of determination shall be calculated after giving effect to all cash returns of principalor capital thereon, cash dividends or other cash returns on the Investments thereon, received by the Loan Party or Subsidiary which made suchInvestment and applied in a manner not prohibited by this Agreement.

7.9 Limitation on Optional Payments and Modifications of Debt Instruments, etc. (a) Make any optional or voluntary payment,prepayment, repurchase or redemption of, or otherwise voluntarily or optionally defease, the Senior Notes, any Indebtedness incurred aspermitted by Section 7.2(n) or (o) or any Disqualified Stock, or segregate funds for any such payment, prepayment, repurchase, redemption ordefeasance, or enter into any derivative or other transaction with any Derivatives Counterparty obligating Holdings, the Borrower or anySubsidiary to make payments to such Derivatives Counterparty as a result of any change in market value of the Senior Notes, anyIndebtedness incurred as permitted by Section 7.2(n) or (o) or any Disqualified Stock, except for prepayments, repurchases, redemptions,defeasances or segregations of funds with the proceeds of refinancings or replacements thereof permitted by Section 7.2 (f) (in the case ofrefinancings or replacements of the Senior Notes), (n) (in the case of refinancings or replacements of Indebtedness incurred as permitted bySection 7.2(n)) or (o) (in the case of refinancings or replacements of Indebtedness incurred as permitted by Section 7.2(o)) or with theissuance or sale of Capital Stock (other than Disqualified Stock) of the Borrower or Holdings, (b) amend, modify or otherwise change, orconsent or agree to any amendment, modification, waiver or other change to, any of the terms of the Senior Notes or the Senior NoteIndenture, any Senior Unsecured Debt Documents, any Subordinated Debt Documents or any Senior Note Refinancing Documents, (otherthan any such amendment, modification, waiver or other change which (i) would extend the maturity or reduce the amount of any payment ofprincipal thereof, reduce the rate or extend the date for payment of interest thereon or relax any covenant or other restriction applicable toHoldings, the Borrower or any of its Subsidiaries or (ii) is not otherwise materially adverse to the interests of the Lenders hereunder), or(c) amend its Governing Documents in any manner materially adverse to the interests of the Lenders hereunder.

7.10 Limitation on Transactions with Affiliates. Enter into any transaction, including any purchase, sale, lease or exchange of Property,the rendering of any service or the payment of any management, advisory or similar fees, with any Affiliate (other than Holdings, theBorrower or any Subsidiary) unless such transaction is (a) otherwise permitted under this Agreement, (b) in the ordinary course of business ofHoldings, the Borrower or such Subsidiary, as the case may be, and (c) upon fair and reasonable terms no less favorable to Holdings, theBorrower or such Subsidiary, as the case may be, than it would obtain in a comparable arm's length transaction with a Person that is not anAffiliate; provided, however, that the Borrower or any of its Subsidiaries may enter into any transaction with a Person in which it has a jointventure interest involving an aggregate amount (or, in the case of any loan, an aggregate principal amount) of less than $2,500,000.Notwithstanding the foregoing, (i) any Special Purpose Subsidiary may enter into any transaction with any Person in which such SpecialPurpose Subsidiary has an Investment in connection with a Receivable Financing Transaction and (ii) Holdings and the Borrower and itsSubsidiaries may perform their respective obligations under the Transaction Documentation.

7.11 Limitation on Sales and Leasebacks. Enter into any arrangement with any Person providing for the leasing by Holdings, theBorrower or any of its Subsidiaries of real or personal property which has been or is to be sold or transferred by Holdings, the Borrower orsuch Subsidiary to such Person or to any other Person to whom funds have been or are to be advanced by such Person on the security of suchProperty or rental obligations of Holdings, the Borrower or such Subsidiary unless (i) the sale of such Property is permitted by Section 7.5 and(ii) any Capital Lease Obligations or Liens arising in connection therewith are permitted by Sections 7.2(c) and 7.3(g) or (i), respectively.

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7.12 Limitation on Changes in Fiscal Periods. Permit the fiscal year of the Borrower to end on a day other than December 31 or changethe Borrower's method of determining fiscal quarters.

7.13 Limitation on Negative Pledge Clauses. Enter into or suffer to exist or become effective any agreement that prohibits or limits theability of Holdings, the Borrower or any of its Subsidiaries to create, incur, assume or suffer to exist any Lien upon any of its Property orrevenues, whether now owned or hereafter acquired, to secure the Obligations or, in the case of any guarantor, its obligations under theGuarantee and Collateral Agreement, other than (a) this Agreement and the other Loan Documents, (b) the Senior Note Indenture, (c) anyagreements governing any purchase money Liens or Capital Lease Obligations otherwise permitted hereby (in which case, any prohibition orlimitation shall only be effective against the assets financed thereby), (d) any agreements evidencing a Receivable Financing Transactionpermitted by Section 7.5(l), (e) any agreements of any Foreign Subsidiary governing Indebtedness of such Foreign Subsidiary incurredpursuant to Section 7.2 (in which case, any prohibition or limitation shall only be effective against the assets of such Foreign Subsidiary andits Foreign Subsidiaries), (f) any agreements with respect to any Subsidiary acquired in a transaction permitted by Section 7.8 (in which case,any prohibition or limitation shall only be effective against the assets of such Subsidiary) and (g) any agreements governing Indebtednesspermitted by Section 7.2 incurred by the Borrower or any Domestic Subsidiary (provided that any such prohibition or limitation shall in anyevent permit Liens securing (i) the Indebtedness and other obligations under the Loan Documents (as such agreements may be amended,including any amendment and restatement thereof, supplemented or otherwise modified from time to time, including by one or moreagreements extending the maturity of, refinancing, replacing or otherwise restructuring, all or any portion of Indebtedness under suchagreements or any successor or replacement agreements and whether by the same or any other agent, lender, or group of lenders), and anyGuarantee Obligations in respect of such Indebtedness and other obligations, in an aggregate principal amount at least equal to the thenaggregate of the outstanding aggregate principal amount loans, face amount of outstanding letters of credit and then undrawn revolving creditcommitments under the Facilities (including any refinancings, refundings, renewals or extensions thereof that do not increase the principalamount thereof), and (ii) Hedge Agreements with any Lender or Lender Affiliate, and any Guarantee Obligations in respect of such HedgeAgreements.

7.14 Limitation on Restrictions on Subsidiary Distributions. Enter into or suffer to exist or become effective any consensualencumbrance or restriction on the ability of any Subsidiary of the Borrower to (a) make Restricted Payments in respect of any Capital Stock ofsuch Subsidiary held by, or pay any Indebtedness owed the Borrower or any other Subsidiary, (b) make Investments in the Borrower or anyother Subsidiary of the Borrower or (c) transfer any of its assets to the Borrower or any other Subsidiary of the Borrower, except for (i) suchencumbrances or restrictions existing under or by reason of any restrictions existing under the Loan Documents, (ii) any restrictions withrespect to a Subsidiary imposed pursuant to an agreement that has been entered into in connection with the Disposition of all or substantiallyall of the Capital Stock or assets of such Subsidiary, (iii) any encumbrances or restrictions arising from any applicable law, rule, regulation ororder or any other agreement in effect or entered into at the Closing Date, (iv) with respect to clause (c) only, restrictions on transfers of assetssubject to any Lien permitted under Sections 7.3(c), (d), (g), (i), (k), (l), (o) or (q), (v) any restrictions on a Special Purpose Subsidiary thatarise pursuant to the terms of any agreement entered into in connection with any Receivable Financing Transaction and apply only to suchSpecial Purpose Subsidiary, (vi) any restrictions with respect to any Foreign Subsidiary (and its Foreign Subsidiaries) contained in agreementsgoverning Indebtedness of such Foreign Subsidiary incurred pursuant to Section 7.2, (vii) any encumbrances or restrictions imposed by reasonof customary provisions contained in leases, licenses, joint ventures agreements and similar agreements entered into in the ordinary course ofbusiness, (viii) any encumbrances or restrictions that are or were created by virtue of any transfer of, agreement to transfer or option or rightwith respect to any property, assets or Capital Stock not otherwise prohibited by this Agreement (which encumbrances or restrictions arelimited to such property, assets or Capital Stock); (ix) any restrictions in a contractual obligation incurred in the ordinary course of businessand on

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customary terms which prohibit transfer of asserts subject of the applicable contractual obligation, (x) restrictions on cash or other deposits ornet worth imposed by customers, suppliers or, in the ordinary course of business, other third parties (other than holders of Indebtedness), and(xi) any restrictions contained in agreements related to Indebtedness permitted by Section 7.2 (provided that no such agreement shall be morerestrictive, in any material respect, than this Agreement with respect to any transaction described in clause (a), (b) or (c) above).

7.15 Limitation on Lines of Business. Enter into any business, either directly or through any Subsidiary, except for those businessesthat are of the same general type in which the Borrower and its Subsidiaries are engaged on the Closing Date (after giving effect to theTransaction) or that are reasonably related or incidental thereto.

7.16 Limitation on Amendments to Transaction Documents. Amend, supplement or otherwise modify or fail to enforce the terms andconditions of any of the Transaction Documentation except to the extent that any such amendment, supplement or modification or failure toenforce both (i) could not reasonably be expected to have a Material Adverse Effect and (ii) would not materially adversely affect, as a whole,the rights of the Lenders hereunder.

7.17 Special Purpose Subsidiary. Permit (a) any Special Purpose Subsidiary to engage in any business other than Receivable FinancingTransactions and activities directly related thereto or (b) recourse at any time to Holdings, the Borrower or any of its Subsidiaries (other than aSpecial Purpose Subsidiary) or any of their respective assets for any liability, direct or indirect, contingent or otherwise, in respect of anyobligation of a Special Purpose Subsidiary whether arising under or in connection with any Receivable Financing Transaction or otherwise(other than pursuant to Standard Securitization Undertakings).

7.18 Limitation on Activities of Holdings. In the case of Holdings, notwithstanding anything to the contrary in this Agreement or anyother Loan Document, (a) conduct, transact or otherwise engage in any business or operations other than those incidental to its ownership ofthe Capital Stock of the Borrower or those activities customarily carried out or required of a publicly-owned holding company (including inconnection with the issuance of any Capital Stock and the appointment and employment of officers and employees), (b) incur, create, assumeor suffer to exist any Indebtedness or other financial obligations, except (i) nonconsensual obligations imposed by operation of law,(ii) pursuant to (x) the Loan Documents to which it is a party and the Senior Note Indenture, (y) Guarantee Obligations permitted pursuant toSection 7.2(e), (f), (n) or (o) and/or (z) Indebtedness permitted pursuant to Section 7.2(t) and (iii) obligations with respect to its Capital Stock,or (c) own, lease, manage or otherwise operate any properties or assets (other than cash (including cash received by it in connection withdividends and other Restricted Payments made by the Borrower in accordance with Section 7.6 pending application in the mannercontemplated by said Section), Cash Equivalents and other assets reasonably incidental to the conduct of its activities as a publicly tradedholding company) and other than in connection with the ownership of shares of Capital Stock of the Borrower.

7.19 Limitation on Activities of Tronox Finance. In the case of Tronox Finance, notwithstanding anything to the contrary in thisAgreement or any other Loan Document, (a) conduct, transact or otherwise engage in, or commit to conduct, transact or otherwise engage in,any business or operations other than those incidental to its status as guarantor of the Obligations and co-issuer of the Senior Notes or otherIndebtedness permitted pursuant to Section 7.2(e), (f), (n) or (o), (b) incur, create, assume or suffer to exist any Indebtedness or other financialobligations, except (i) nonconsensual obligations imposed by operation of law, (ii) pursuant to the Loan Documents to which it is a party andthe Senior Note Indenture or other Indebtedness permitted pursuant to Section 7.2(e), (f), (n) or (o) and (iii) obligations with respect to itsCapital Stock, or (c) own, lease, manage or otherwise operate any properties or assets (including cash and Cash Equivalents).

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7.20 Limitation on Hedge Agreements. Enter into any Hedge Agreement other than Hedge Agreements entered into in the ordinarycourse of business, and not for speculative purposes, to protect against or mitigate changes in interest rates or foreign exchange rates orcommodity prices.

7.21 Post-Closing Deliveries. Fail to (a) deliver to the Administrative Agent each item set forth in Schedule 7.21, in form and substancereasonably satisfactory to the Administrative Agent and together with each certificate or other document ancillary thereto and reasonablyrequested by the Administrative Agent and (b) perform each action set forth in Schedule 7.21 in a manner reasonably satisfactory to theAdministrative Agent and together with each ancillary action reasonably requested by the Administrative Agent to be performed by any LoanParty in connection therewith, in each case (x) within the periods set forth opposite each such item or action on such Schedule and (y) unlessotherwise agreed by the Administrative Agent in respect of any such item or action.

SECTION 8. EVENTS OF DEFAULT

If any of the following events shall occur and be continuing:

(a) The Borrower shall fail to pay any principal of any Loan or Reimbursement Obligation when due in accordance with the termshereof; or the Borrower shall fail to pay any interest on any Loan or Reimbursement Obligation or shall fail to pay any fees payable hereunderwithin five Business Days after any such interest or fees becomes due in accordance with the terms hereof or thereof; or any Loan Party shallfail to pay any other amount payable hereunder or under any other Loan Documents within 10 Business Days after the date on which theAdministrative Agent provided notice to the Borrower that such amount has become due in accordance with the terms hereof or thereof; or

(b) Any representation or warranty made or deemed made by any Loan Party herein or in any other Loan Document or that is containedin any certificate delivered pursuant to Section 6.2(b)(i) or Section 6.2(b)(ii)(x) shall prove to have been inaccurate in any material respect onor as of the date made or deemed made; or

(c) Any Loan Party shall default in the observance or performance of any agreement contained in clause (i) of Section 6.4(a) (withrespect to Holdings and the Borrower only), Section 6.7(a) or Section 7; or

(d) Any Loan Party shall default in the observance or performance of any covenant or other agreement contained in this Agreement orany other Loan Document (other than as provided in paragraphs (a) through (c) of this Section), and such default shall continue unremediedfor a period of 30 days from the date on which the Administrative Agent provided notice of such default to such Loan Party referencing thisSection 8(d); or

(e) Holdings, the Borrower or any of its Subsidiaries shall (i) default in making any payment of any principal of any Indebtedness,including any Guarantee Obligation, but excluding the Loans and Reimbursement Obligations) beyond the period of grace, if any, provided inthe instrument or agreement under which such Indebtedness was created; or (ii) default in making any payment of any interest on any suchIndebtedness beyond the period of grace, if any, provided in the instrument or agreement under which such Indebtedness was created; or(iii) default in the observance or performance of any other agreement or condition relating to any such Indebtedness or contained in anyinstrument or agreement evidencing, securing or relating thereto, or any other event shall occur or condition exist, unless waived or cured asprovided in the instrument or agreement under which such Indebtedness was created, the effect of which default or other event or condition isto cause, or to permit the holder or beneficiary of such Indebtedness (or a trustee or agent on behalf of such holder or beneficiary) to cause,with the giving of notice if required, such Indebtedness to become due prior to its stated maturity, any applicable grace period having expired,or (in the case of any such Indebtedness constituting a Guarantee Obligation) to become payable, any applicable grace period having expired;provided, that a default, event or condition described in clause (i), (ii) or (iii) of this paragraph (e) shall not at any time constitute an Event ofDefault

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unless, at such time, one or more defaults, events or conditions (without duplication as to the same item of Indebtedness) of the type describedin clauses (i), (ii) and (iii) of this paragraph (e) shall have occurred and be continuing with respect to Indebtedness the outstanding principalamount of which exceeds in the aggregate $25,000,000; or

(f) (i) Holdings, the Borrower or any of its Subsidiaries (other than any Immaterial Subsidiary) shall commence any case, proceeding orother action (A) under any existing or future law of any jurisdiction, domestic or foreign, relating to bankruptcy, insolvency, reorganization orrelief of debtors, seeking to have an order for relief entered with respect to it, or seeking to adjudicate it a bankrupt or insolvent, or seekingreorganization, arrangement, adjustment, winding up, liquidation, dissolution, composition or other relief with respect to it or its debts, or(B) seeking appointment of a receiver, trustee, custodian, conservator or other similar official for it or for all or any substantial part of itsassets, or Holdings, the Borrower or any of its Subsidiaries (other than any Immaterial Subsidiary) shall make a general assignment for thebenefit of its creditors; or (ii) there shall be commenced against Holdings, the Borrower or any of its Subsidiaries (other than any ImmaterialSubsidiary) any case, proceeding or other action of a nature referred to in clause (i) above that (A) results in the entry of an order for relief orany such adjudication or appointment or (B) remains undismissed, undischarged or unbonded for a period of 60 days; or (iii) there shall becommenced against Holdings, the Borrower or any of its Subsidiaries (other than any Immaterial Subsidiary) any case, proceeding or otheraction seeking issuance of a warrant of attachment, execution, distraint or similar process against all or any substantial part of its assets thatresults in the entry of an order for any such relief that shall not have been vacated, discharged, or stayed or bonded pending appeal within60 days from the entry thereof; or (iv) Holdings, the Borrower or any of its Subsidiaries (other than any Immaterial Subsidiary) shall take anycorporate action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the acts set forth in clause (i), (ii), or(iii) above; or (v) Holdings, the Borrower or any of its Subsidiaries (other than any Immaterial Subsidiary) shall not, or shall be unable to, orshall admit in writing its inability to, generally pay its debts as they become due; or

(g) (i) Any Person shall engage in any "prohibited transaction" (as defined in Section 406 of ERISA or Section 4975 of the Code)involving any Plan, (ii) any "accumulated funding deficiency" (as defined in Section 302 of ERISA), whether or not waived, shall exist withrespect to any Plan, or any Lien in favor of the PBGC or a Plan shall arise on the assets of the Borrower or any Commonly Controlled Entity,(iii) a Reportable Event shall occur with respect to, or proceedings shall commence to have a trustee appointed, or a trustee shall be appointed,to administer or to terminate, any Single Employer Plan, which Reportable Event or commencement of proceedings or appointment of atrustee is likely to result in the termination of such Plan for purposes of Title IV of ERISA, (iv) any Single Employer Plan shall terminate forpurposes of Title IV of ERISA without the approval of the Internal Revenue Service and the PBGC, (v) the Borrower or any CommonlyControlled Entity shall incur any liability in connection with a withdrawal from, or the Insolvency or Reorganization of, a MultiemployerPlan, (vi) the Borrower, or any of its Subsidiaries or any Commonly Controlled Entity shall be required to make during any fiscal year of theBorrower payments pursuant to any employee welfare benefit plan (as defined in Section 3.1 of ERISA) that provides benefits to retiredemployees (or their dependents) that, in the aggregate, exceed the amount set forth on Schedule 8(g)(i) with respect to such fiscal year or(vii) the Borrower, or any of its Subsidiaries or any Commonly Controlled Entity shall be required to make during any fiscal year of theBorrower contributions to any defined benefit pension plan subject to Title IV of ERISA (including any Multiemployer Plan) that, in theaggregate, exceed the amount set forth on Schedule 8(g)(ii) with respect to such fiscal year; and in each case in clauses (i) through (vii) above,such event or condition, together with all other such events or conditions, if any, would reasonably be expected to have a Material AdverseEffect; or

(h) One or more judgments or decrees shall be entered against Holdings, the Borrower or any of its Subsidiaries involving for Holdings,the Borrower and its Subsidiaries taken as a whole a liability (not paid

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or fully covered by insurance) of $25,000,000 or more, and all such judgments or decrees shall not have been vacated, discharged, stayed orbonded pending appeal within 60 days from the entry thereof; or

(i) Any of the Security Documents covering a material portion of the Collateral shall cease, for any reason (unless released by theAdministrative Agent or as otherwise permitted by this Agreement or the other Loan Documents), to be in full force and effect, or any LoanParty shall so assert in writing, or any Lien created by any of the Security Documents covering any material portion of the Collateral shallcease to be enforceable and of the same effect and priority purported to be created thereby; or

(j) The guarantee contained in Section 2 of the Guarantee and Collateral Agreement shall cease, for any reason (other than by reason ofthe express release thereof pursuant to Section 10.15), to be in full force and effect in any material respect or any Loan Party shall so assert inwriting; or

(k) Any Change of Control shall occur;

then, and in any such event, (A) if such event is an Event of Default specified in clause (i) or (ii) of paragraph (f) above with respect to theBorrower, automatically the Commitments shall immediately terminate and the Loans hereunder (with accrued interest thereon) and all otheramounts owing under this Agreement and the other Loan Documents (including all amounts of L/C Obligations, whether or not thebeneficiaries of the then outstanding Letters of Credit shall have presented the documents required thereunder) shall immediately become dueand payable, and (B) if such event is any other Event of Default, either or both of the following actions may be taken: (i) with the consent ofthe Majority Revolving Credit Facility Lenders, the Administrative Agent may, or upon the request of the Majority Revolving Credit FacilityLenders, the Administrative Agent shall, by notice to the Borrower declare the Revolving Credit Commitments to be terminated forthwith,whereupon the Revolving Credit Commitments shall immediately terminate; and (ii) with the consent of the Required Lenders, theAdministrative Agent may, or upon the request of the Required Lenders, the Administrative Agent shall, by notice to the Borrower, declarethe Loans hereunder (with accrued interest thereon) and all other amounts owing under this Agreement and the other Loan Documents(including all amounts of L/C Obligations, whether or not the beneficiaries of the then outstanding Letters of Credit shall have presented thedocuments required thereunder) to be due and payable forthwith, whereupon the same shall immediately become due and payable. Upon theoccurrence and during the continuation of an Event of Default, the Administrative Agent and the Lenders shall be entitled to exercise any andall remedies available under the Security Documents, including the Guarantee and Collateral Agreement, or otherwise available underapplicable law or otherwise. With respect to all Letters of Credit with respect to which presentment for honor shall not have occurred at thetime of an acceleration pursuant to this paragraph, the Borrower shall at such time deposit in a cash collateral account opened by theAdministrative Agent an amount in immediately available funds in the Applicable Currency equal to the aggregate then undrawn andunexpired amount of such Letters of Credit (and the Borrower hereby grants to the Administrative Agent, for the ratable benefit of the SecuredParties, a continuing security interest in all amounts at any time on deposit in such cash collateral account to secure the undrawn andunexpired amount of such Letters of Credit and all other Obligations). If at any time the Administrative Agent reasonably determines that anyfunds held in such cash collateral account are subject to any senior or pari-passu right or claim of any Person other than the AdministrativeAgent and the Secured Parties or that the total amount of such funds in the Applicable Currency is less than the aggregate undrawn andunexpired amount of outstanding Letters of Credit, the Borrower shall, forthwith upon demand by the Administrative Agent, pay to theAdministrative Agent, as additional funds to be deposited and held in such cash collateral account, an amount in the Applicable Currencyequal to the excess of (a) such aggregate undrawn and unexpired amount over (b) the total amount of funds, if any, then held in such cashcollateral account that the Administrative Agent reasonably determines to be free and clear of any such right and claim. Amounts held in suchcash collateral account shall be applied by the Administrative Agent to the payment of drafts drawn under such Letters of Credit, and theunused portion thereof after all such Letters of Credit shall have expired or been fully drawn upon, if any, shall be applied to repay otherobligations of the Borrower

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hereunder and under the other Loan Documents. After all such Letters of Credit shall have expired or been fully drawn upon, allReimbursement Obligations shall have been satisfied and all other Obligations of the Borrower hereunder and under the other LoanDocuments (excluding Obligations in respect of any Specified Hedge Agreement and unmatured contingent reimbursement andindemnification Obligations) shall have been paid in full, the balance, if any, in such cash collateral account shall be returned to the Borrower(or such other Person as may be lawfully entitled thereto).

SECTION 9. THE AGENTS; THE ARRANGERS

9.1 Appointment. Each Lender hereby irrevocably designates and appoints the Agents as the agents of such Lender under thisAgreement and the other Loan Documents, and each Lender irrevocably authorizes each Agent, in such capacity, to take such action on itsbehalf under the provisions of this Agreement and the other Loan Documents and to exercise such powers and perform such duties as areexpressly delegated to such Agent by the terms of this Agreement and the other Loan Documents, together with such other powers as arereasonably incidental thereto. Notwithstanding any provision to the contrary elsewhere in this Agreement, no Agent shall have any duties orresponsibilities, except those expressly set forth herein, or any fiduciary relationship with any Lender, and no implied covenants, functions,responsibilities, duties, obligations or liabilities shall be read into this Agreement or any other Loan Document or otherwise exist against anyAgent.

9.2 Delegation of Duties. Each Agent may execute any of its duties under this Agreement and the other Loan Documents by orthrough agents or attorneys-in-fact and shall be entitled to advice of counsel concerning all matters pertaining to such duties. No Agent shallbe responsible for the negligence or misconduct of any agents or attorneys-in-fact selected by it with reasonable care.

9.3 Exculpatory Provisions. Neither the Arrangers, any Agent nor any of its officers, directors, partners, employees, agents, attorneysand other advisors, attorneys-in-fact or affiliates shall be (i) liable for any action lawfully taken or omitted to be taken by it or such Personunder or in connection with this Agreement or any other Loan Document (except to the extent that any of the foregoing are found by a finaldecision of a court of competent jurisdiction to have resulted from its or such Person's own gross negligence or willful misconduct) or(ii) responsible in any manner to any of the Lenders for any recitals, statements, representations or warranties made by any Loan Party or anyofficer thereof contained in this Agreement or any other Loan Document or in any certificate, report, statement or other document referred toor provided for in, or received by the Arrangers or the Agents under or in connection with, this Agreement or any other Loan Document or forthe value, validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement or any other Loan Document or for any failureof any Loan Party party thereto to perform its obligations hereunder or thereunder. The Agents shall not be under any obligation to any Lenderto ascertain or to inquire as to the observance or performance of any of the agreements contained in, or conditions of, this Agreement or anyother Loan Document, or to inspect the properties, books or records of any Loan Party.

9.4 Reliance by Agents. Each Agent shall be entitled to rely, and shall be fully protected in relying, upon any instrument, writing,resolution, notice, consent, certificate, affidavit, letter, telecopy, telex or teletype message, statement, order or other document or conversationbelieved by it to be genuine and correct and to have been signed, sent or made by the proper Person or Persons and upon advice andstatements of legal counsel (including counsel to any Loan Party), independent accountants and other experts selected by such Agent. TheAgents may deem and treat the payee of any Note as the owner thereof for all purposes unless a written notice of assignment, negotiation ortransfer thereof shall have been filed with the Administrative Agent. Each Agent shall be fully justified in failing or refusing to take any actionunder this Agreement or any other Loan Document unless it shall first receive such advice or concurrence of the Required Lenders or therequisite Lenders required under Section 10.1 to authorize or require such action (or, if so specified by this Agreement, all Lenders) as itdeems appropriate or it shall first be indemnified to its satisfaction by the Lenders against any and all liability and expense that may be

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incurred by it by reason of taking or continuing to take any such action. Each Agent shall in all cases be fully protected in acting, or inrefraining from acting, under this Agreement and the other Loan Documents in accordance with a request of the Required Lenders or therequisite Lenders required under Section 10.1 to authorize or require such action (or, if so specified by this Agreement, all Lenders), and suchrequest and any action taken or failure to act pursuant thereto shall be binding upon all the Lenders and all future holders of the Loans.

9.5 Notice of Default. No Agent shall be deemed to have knowledge or notice of the occurrence of any Default or Event of Defaulthereunder unless such Agent shall have received notice from a Lender, Holdings or the Borrower referring to this Agreement, describing suchDefault or Event of Default and stating that such notice is a "notice of default". In the event that the Administrative Agent shall receive such anotice, the Administrative Agent shall give notice thereof to the Lenders. The Administrative Agent shall take such action with respect to suchDefault or Event of Default as shall be reasonably directed by the Required Lenders or the requisite Lenders required hereunder to authorize orrequire such action (or, if so specified by this Agreement, all Lenders; provided that unless and until the Administrative Agent shall havereceived such directions, the Administrative Agent may (but shall not be obligated to) take such action, or refrain from taking such action,with respect to such Default or Event of Default as it shall deem advisable in the best interests of the Lenders.

9.6 Non-Reliance on the Arrangers, the Agents and Other Lenders. Each Lender expressly acknowledges that neither the Arrangers,any of the Agents nor any of their respective officers, directors, employees, agents, attorneys and other advisors, partners, attorneys-in-fact oraffiliates have made any representations or warranties to it and that no act by any Agent hereafter taken, including any review of the affairs ofa Loan Party or any affiliate of a Loan Party, shall be deemed to constitute any representation or warranty by the Arrangers, any Agent to anyLender. Each Lender represents to the Agents and the Arrangers that it has, independently and without reliance upon the Arrangers, any Agentor any other Lender, and based on such documents and information as it has deemed appropriate, made its own appraisal of and investigationinto the business, operations, property, financial and other condition, prospects and creditworthiness of the Loan Parties and their affiliates andmade its own decision to make its Loans (and in the case of any Issuing Lender, to issue its Letters of Credit) hereunder and enter into thisAgreement. Each Lender also represents that it will, independently and without reliance upon the Arrangers, any Agent or any other Lender,and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit analysis, appraisals anddecisions in taking or not taking action under this Agreement and the other Loan Documents, and to make such investigation as it deemsnecessary to inform itself as to the business, operations, property, financial and other condition, prospects and creditworthiness of the LoanParties and their affiliates. Except for notices, reports and other documents expressly required to be furnished to the Lenders by theAdministrative Agent hereunder, no Arranger and no Agent shall have any duty or responsibility to provide any Lender with any credit orother information concerning the business, operations, property, condition (financial or otherwise), prospects or creditworthiness of any LoanParty or any affiliate of a Loan Party that may come into the possession of the Arrangers or Agent or any of its officers, directors, employees,agents, attorneys and other advisors, partners, attorneys-in-fact or affiliates.

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9.7 Indemnification. The Lenders agree to indemnify the Arrangers and each Agent in its capacity as such (to the extent notreimbursed by Holdings or the Borrower and without limiting the obligation of Holdings or the Borrower to do so), ratably according to theirrespective Aggregate Exposure Percentages in effect on the date on which indemnification is sought under this Section (or, if indemnificationis sought after the date upon which the Commitments shall have terminated and the Loans shall have been paid in full, ratably in accordancewith such Aggregate Exposure Percentages immediately prior to such date), from and against, any and all liabilities, obligations, losses,damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind whatsoever that may at any time (including at anytime following the payment of the Loans) be imposed on, incurred by or asserted against the Arrangers or such Agent in any way relating to orarising out of, the Commitments, this Agreement, any of the other Loan Documents, the Transaction Documentation, or any documentscontemplated by or referred to herein or therein or the transactions contemplated hereby or thereby or any action taken or omitted by theArrangers or such Agent under or in connection with any of the foregoing; provided that no Lender shall be liable for the payment of anyportion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements that are found bya final and nonappealable decision of a court of competent jurisdiction to have resulted solely and proximately from the Arrangers' or suchAgent's gross negligence or willful misconduct in breach of a duty owed to such Lender. The agreements in this Section 9.7 shall survive thepayment of the Loans and Letters of Credit and all other amounts payable hereunder.

9.8 Arrangers and Agent in their Individual Capacities. The Arrangers and each Agent and its affiliates may make loans to, acceptdeposits from and generally engage in any kind of business with any Loan Party as though the Arrangers or such Agent were not an Arrangeror an Agent. With respect to its Loans made or renewed by it and with respect to any Letter of Credit issued or participated in by it, theArrangers and each Agent shall have the same rights and powers under this Agreement and the other Loan Documents as any Lender and mayexercise the same as though it were not an Arranger or an Agent, and the terms "Lender" and "Lenders" shall include the Arrangers and theAgent in their individual capacities.

9.9 Successor Administrative Agent. The Administrative Agent may resign as Administrative Agent upon 30 days' notice to theLenders and the Borrower. If the Administrative Agent shall resign as Administrative Agent under this Agreement and the other LoanDocuments, then the Required Lenders shall appoint from among the Lenders a successor agent for the Lenders, which successor agent shall(unless an Event of Default under Section 8(a) or Section 8(f) with respect to the Borrower shall have occurred and be continuing) be subjectto approval by the Borrower (which approval shall not be unreasonably withheld or delayed), whereupon such successor agent shall succeed tothe rights, powers and duties of the Administrative Agent, and the term "Administrative Agent" shall mean such successor agent effectiveupon such appointment and approval, and the former Administrative Agent's rights, powers and duties as Administrative Agent shall beterminated, without any other or further act or deed on the part of such former Administrative Agent or any of the parties to this Agreement orany holders of the Loans or issuers of Letters of Credit. If no successor agent has accepted appointment as Administrative Agent by the datethat is 30 days following a retiring Administrative Agent's notice of resignation, the retiring Administrative Agent's resignation shallnevertheless thereupon become effective, and the Lenders shall assume and perform all of the duties of the Administrative Agent hereunderuntil such time, if any, as the Required Lenders appoint a successor agent as provided for above. The Syndication Agent may, at any time, bynotice to the Lenders and the Administrative Agent, resign as Syndication Agent hereunder, whereupon the duties, rights, obligations andresponsibilities of the Syndication Agent hereunder shall automatically be assumed by, and inure to the benefit of, the Administrative Agent,without any further act by the Arrangers, any Agent or any Lender. After any retiring Agent's resignation as Agent, the provisions of thisSection 9 shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Agent under this Agreement and the otherLoan Documents.

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9.10 Authorization to Release Liens and Guarantees. The Administrative Agent is hereby irrevocably authorized by each of the Lendersto release any Lien covering any Property of the Holdings or any of its Subsidiaries that is the subject of a Disposition which is permitted bythe Loan Documents or which has been consented to in accordance with Section 10.1.

9.11 The Arrangers; the Syndication Agent and the Documentation Agents. The Arrangers, the Syndication Agent and theDocumentation Agents, in their respective capacities as such, shall have no duties or responsibilities, and shall incur no liability, under thisAgreement and the other Loan Documents.

9.12 Withholding Tax. (a) To the extent required by any applicable law, the Administrative Agent may withhold from any interestpayment to any Lender an amount equivalent to any applicable withholding tax. If the forms or other documentation required bySection 2.20(d) or (e) are not delivered to the Administrative Agent, then the Administrative Agent may withhold from any interest paymentto any Lender not providing such forms or other documentation, an amount equivalent to the applicable withholding tax.

(b) If the Internal Revenue Service or any authority of the United States or other jurisdiction asserts a claim that the AdministrativeAgent did not properly withhold tax from amounts paid to or for the account of any Lender (because the appropriate form was not delivered,was not properly executed, or because such Lender failed to notify the Administrative Agent of a change in circumstances which rendered theexemption from, or reduction of, withholding tax ineffective, or for any other reason), such Lender shall indemnify the Administrative Agentfully for all amounts paid, directly or indirectly, by the Administrative Agent as tax or otherwise, including penalties and interest, togetherwith all expenses incurred, including legal expenses, allocated staff costs and any out of pocket expenses.

(c) If any Lender sells, assigns, grants a participation in, or otherwise transfers its rights under this Agreement, the purchaser, assignee,participant or transferee, as applicable, shall comply and be bound by the terms of Sections 2.20(d) and (e) and 9.12; provided that withrespect to any Participant, as set forth in Section 10.6(b), such Participant shall only be required to comply with the requirements of Sections2.12(d) and (e) and 9.12 if such Participant seeks to obtain the benefits of Section 2.20.

SECTION 10. MISCELLANEOUS

10.1 Amendments and Waivers. Neither this Agreement nor any other Loan Document nor any terms hereof or thereof may beamended, supplemented or modified except in accordance with the provisions of this Section 10.1. The Required Lenders and each Loan Partyparty to the relevant Loan Document may, or (with the written consent of the Required Lenders) the Administrative Agent and each LoanParty party to the relevant Loan Document may, from time to time, (a) enter into written amendments, supplements or modifications heretoand to the other Loan Documents (including amendments and restatements hereof or thereof) for the purpose of adding any provisions to thisAgreement or the other Loan Documents or changing in any manner the rights of the Lenders or of the Loan Parties hereunder or thereunderor (b) waive, on such terms and conditions as may be specified in the instrument of waiver, any of the requirements of this Agreement or theother Loan Documents or any Default or Event of Default and its consequences; provided, however, that no such waiver and no suchamendment, supplement or modification shall:

(i) forgive the principal amount or extend the final scheduled date of maturity of any Loan or Reimbursement Obligation,extend the scheduled date of any amortization payment in respect of any Tranche A Term Loan, reduce the stated rate of any interestor fee payable hereunder (except in connection with the waiver of applicability of any post-default increase in interest rates (whichwaiver shall be effective with the consent of the Majority Facility Lenders of each adversely affected Facility)) or extend thescheduled date of any payment thereof in each case without the consent of each Lender directly affected thereby;

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(ii) increase the amount or extend the expiration date of any Commitment of any Lender without the consent of such Lender(it being understood that waivers or modifications of covenants, Defaults or Events of Default or of mandatory reductions ofCommitments, if any, shall not constitute an increase in the Commitment of any Lender);

(iii) amend, modify or waive any provision of this Section or reduce any percentage specified in the definition of RequiredLenders, consent to the assignment or transfer by the Borrower of any of its rights and obligations under this Agreement and theother Loan Documents, release all or substantially all of the Collateral or release all or substantially all of the Subsidiary Guarantorsfrom their guarantee obligations under the Guarantee and Collateral Agreement, in each case without the consent of all Lendersunless otherwise expressly permitted herein or in any other Loan Document;

(iv) amend, modify or waive any condition precedent to any extension of credit under the Revolving Credit Facility set forth inSection 5.2 (including the waiver of an existing Default or Event of Default required to be waived in order for such extension ofcredit to be made) without the consent of the Majority Revolving Credit Facility Lenders;

(v) reduce the percentage specified in the definition of Majority Facility Lenders with respect to any Facility without thewritten consent of all Lenders under such Facility;

(vi) amend, modify or waive any provision of Section 9 or any other provision of any Loan Document relating to theobligations of the Arrangers or any Agent without the consent of the Arrangers or Agent directly affected thereby;

(vii) amend, modify or waive any provision of Section 2.6 or 2.7 without the written consent of the Swing Line Lender;

(viii) amend, modify or waive any provision of Section 2.18 relating solely to the pro rata treatment of Lenders without theconsent of each Lender directly and adversely affected thereby; or

(ix) amend, modify or waive any provision of Section 3 without the consent of each Issuing Lender adversely affected thereby.

Any such waiver and any such amendment, supplement or modification shall apply equally to each of the Lenders and shall be binding uponthe Loan Parties, the Lenders, the Arrangers, the Agents and all future holders of the Loans. In the case of any waiver, the Loan Parties, theLenders, the Arrangers and the Agents shall be restored to their former position and rights hereunder and under the other Loan Documents,and any Default or Event of Default waived shall be deemed to be cured and not continuing; but no such waiver shall extend to anysubsequent or other Default or Event of Default, or impair any right consequent thereon. Any such waiver, amendment, supplement ormodification shall be effected by a written instrument signed by the parties required to sign pursuant to the foregoing provisions of thisSection; provided, that delivery of an executed signature page of any such instrument by facsimile transmission shall be effective as deliveryof a manually executed counterpart thereof.

Notwithstanding the foregoing, this Agreement and any other Loan Document may be amended (or amended and restated) with thewritten consent of the Required Lenders, the Administrative Agent and each Loan Party party to each relevant Loan Document (x) to add oneor more additional credit facilities to this Agreement and to permit the extensions of credit from time to time outstanding thereunder and theaccrued interest and fees in respect thereof (collectively, the "Additional Extensions of Credit") to share ratably in the benefits of thisAgreement and the other Loan Documents with the Tranche A Term Loans and Revolving Extensions of Credit and the accrued interest andfees in respect thereof and (y) to include appropriately the Lenders holding such credit facilities in any determination of the Required Lendersand Majority Revolving Facility Lenders.

In addition, notwithstanding the foregoing, this Agreement may be amended with the written consent of the Administrative Agent, theBorrower and the Lenders providing the relevant Replacement Term

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Loans (as defined below) to permit the refinancing, replacement or modification of all outstanding Tranche A Term Loans ("Refinanced TermLoans") with a replacement term loan tranche hereunder ("Replacement Term Loans"), provided that (a) the aggregate principal amount ofsuch Replacement Term Loans shall not exceed the aggregate principal amount of such Refinanced Term Loans, (b) the Applicable Marginfor such Replacement Term Loans shall not be higher than the Applicable Margin for such Refinanced Term Loans and (c) the weightedaverage life to maturity of such Replacement Term Loans shall not be shorter than the weighted average life to maturity of such RefinancedTerm Loans at the time of such refinancing.

10.2 Notices. All notices, requests and demands to or upon the respective parties hereto to be effective shall be in writing (including bytelecopy), and, unless otherwise expressly provided herein, shall be deemed to have been duly given or made when delivered, or threeBusiness Days after being deposited in the mail, postage prepaid, or, in the case of telecopy notice, when received, addressed (a) in the case ofHoldings, the Borrower, the Arrangers and the Agents, as follows and (b) in the case of the Lenders, as set forth in an administrativequestionnaire delivered to the Administrative Agent or on Schedule I to the Lender Addendum to which such Lender is a party or, in the caseof a Lender which becomes a party to this Agreement pursuant to an Assignment and Acceptance, in such Assignment and Acceptance or(c) in the case of any party, to such other address as such party may hereafter notify to the other parties hereto:

Holdings or the Borrower:

Tronox Incorporated123 Robert S. Kerr AvenueOklahoma City, OK 73102Attention: Chief Financial OfficerTelecopy:Telephone:

with a copy to:General CounselTelecopy:Telephone:

The Administrative Agent:

Lehman Commercial Paper Inc.745 Seventh AvenueNew York, New York 10019Attention: Paul ArzouianTelecopy: (646) 758-4980Telephone: (212) 526-5803

with a copy to:

Akin Gump Strauss Hauer & Feld LLP1111 Louisiana Street, Suite 4400Houston, Texas 77002Attention: Eugene F. Cowell IIITelecopy: (713) 236-0822Telephone: (713) 220-8185

Issuing Lender:As notified by such Issuing Lender to the Administrative Agent and theBorrower

provided that any notice, request or demand to or upon Holdings, the Borrower, the Arrangers, any Agent, the Issuing Lender or any Lendershall not be effective until received.

10.3 No Waiver; Cumulative Remedies. No failure to exercise and no delay in exercising, on the part of any party hereto or under theLoan Documents, any right, remedy, power or privilege hereunder or under the other Loan Documents shall operate as a waiver thereof; norshall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the



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exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges herein provided are cumulative and notexclusive of any rights, remedies, powers and privileges provided by law.

10.4 Survival of Representations and Warranties. All representations and warranties made hereunder, in the other Loan Documents andin any document, certificate or statement delivered pursuant hereto or in connection herewith shall survive the execution and delivery of thisAgreement and the making of the Loans and other extensions of credit hereunder.

10.5 Payment of Expenses. The Borrower agrees (a) to pay or reimburse the Arrangers and the Agents for all their reasonable out ofpocket costs and expenses incurred in connection with the syndication of the Facilities (other than fees payable to syndicate members) and thedevelopment, preparation and execution of, and any amendment, supplement or modification to, this Agreement and the other LoanDocuments and any other documents prepared in connection herewith or therewith, and the consummation and administration of thetransactions contemplated hereby and thereby, including the reasonable fees and disbursements and other charges of counsel to theAdministrative Agent (which shall be limited to one counsel for the Administrative Agent except as to local law matters) and the charges ofIntralinks, (b) to pay or reimburse each Lender, the Arrangers and the Agents for all their costs and expenses incurred in connection with theenforcement of any rights under this Agreement, the other Loan Documents and any other documents prepared in connection herewith ortherewith, including the fees and disbursements of counsel (including the allocated fees and disbursements and other charges of in-housecounsel) to each Lender and of counsel to the Agents, (c), without duplication of the Borrower's obligations under Section 2.20(b) hereof, topay and indemnify each Lender, the Arrangers and the Agents for, and hold each Lender, the Arrangers and the Agents harmless from, anyand all recording and filing fees and any and all liabilities with respect to, or resulting from any delay in paying, stamp, excise and othersimilar taxes, if any, which may be payable or determined to be payable in connection with the execution and delivery of, or consummation oradministration of any of the transactions contemplated by, or any amendment, supplement or modification of, or any waiver or consent underor in respect of, this Agreement, the other Loan Documents and any such other documents, and (d) without duplication of the Borrower'sobligations under Section 2.20(b) hereof, to pay, indemnify or reimburse each Lender, the Arrangers, each Agent, and their respective officers,directors, partners, trustees, employees, affiliates, shareholders, attorneys and other advisors, attorneys-in-fact, agents and controlling persons(each, an "Indemnitee") for, and hold each Indemnitee harmless from and against, any and all other liabilities, obligations, losses, damages,penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever with respect to or arising out of anyclaim, proceeding, litigation, or other action concerning or relating to the execution, delivery, enforcement, performance and administration ofthis Agreement, the other Loan Documents and any such other documents, including any of the foregoing relating to the use of proceeds of theLoans or Letters of Credit, the violation of, noncompliance with or liability under, any Environmental Law applicable to the operations ofHoldings, the Borrower any of its Subsidiaries or any of the Properties and to reimburse them for all reasonable fees and disbursements andother charges of legal counsel in connection with claims, actions or proceedings by any Indemnitee against the Borrower hereunder (all theforegoing in this clause (d), collectively, the "Indemnified Liabilities"), provided, that the Borrower shall have no obligation hereunder to anyIndemnitee with respect to Indemnified Liabilities to the extent such Indemnified Liabilities are found by a final decision of a court ofcompetent jurisdiction to have resulted from the gross negligence or willful misconduct of such Indemnitee. No Indemnitee shall be liable forany damages arising from the use by unauthorized persons of Information or other materials sent through electronic, telecommunications orother information transmission systems that are intercepted by such persons, except to the extent resulting from the gross negligence or willfulmisconduct of such indemnitee, as determined by a final decision of a court of competent jurisdiction or for any special, indirect,consequential or punitive damages in connection with the Facilities. Without limiting the foregoing but subject to the proviso of the secondpreceding sentence, and to the extent permitted by applicable law, the Borrower agrees not to assert and to cause its Subsidiaries not to assert,and hereby waives and agrees to cause its Subsidiaries so to waive, all rights for

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contribution or any other rights of recovery with respect to all claims, demands, penalties, fines, liabilities, settlements, damages, costs andexpenses of whatever kind or nature, under or related to Environmental Laws, that any of them might have by statute or otherwise against anyIndemnitee. All amounts due under this Section shall be payable not later than ten Business Days after written demand therefor. Statementspayable by the Borrower pursuant to this Section shall be submitted to the Borrower in accordance with Section 10.2, or to such other Personor address as may be hereafter designated by the Borrower in a written notice to the Administrative Agent. The agreements in this Sectionshall survive repayment of the Loans and all other amounts payable hereunder.

10.6 Successors and Assigns; Participations and Assignments. (a) This Agreement shall be binding upon and inure to the benefit ofHoldings, the Borrower, the Lenders, the Arrangers, the Agents, all future holders of the Loans and Letters of Credit and their respectivesuccessors and assigns permitted hereby, except that neither Holdings nor the Borrower may assign or transfer any of their respective rights orobligations under this Agreement without the prior written consent of the Administrative Agent and each Lender.

(b) Any Lender may, without the consent of the Borrower or any other Person, in accordance with applicable law, at any time sell to oneor more banks, financial institutions or other entities (each, a "Participant") participating interests in any Loan owing to such Lender, anyCommitment of such Lender or any other interest of such Lender hereunder and under the other Loan Documents. In the event of any suchsale by a Lender of a participating interest to a Participant, such Lender's obligations under this Agreement to the other parties to thisAgreement shall remain unchanged, such Lender shall remain solely responsible for the performance thereof, such Lender shall remain theholder of any such Loan for all purposes under this Agreement and the other Loan Documents, and the Borrower and the Agents shallcontinue to deal solely and directly with such Lender in connection with such Lender's rights and obligations under this Agreement and theother Loan Documents. In no event shall any Participant under any such participation have any right to approve any amendment or waiver ofany provision of any Loan Document, or any consent to any departure by any Loan Party therefrom, except to the extent that such amendment,waiver or consent would reduce the principal of, or interest on, the Loans or any fees payable hereunder, or postpone the date of the finalmaturity of the Loans, in each case to the extent subject to such participation. The Borrower agrees that if amounts outstanding under thisAgreement and the Loans are due or unpaid, or shall have been declared or shall have become due and payable upon the occurrence of anEvent of Default, each Participant shall, to the maximum extent permitted by applicable law, be deemed to have the right of setoff in respectof its participating interest in amounts owing under this Agreement to the same extent as if the amount of its participating interest were owingdirectly to it as a Lender under this Agreement, provided that, in purchasing such participating interest, such Participant shall be deemed tohave agreed to share with the Lenders the proceeds thereof as provided in Section 10.7(a) as fully as if such Participant were a Lenderhereunder. The Borrower also agrees that each Participant shall be entitled to the benefits of Sections 2.19, 2.20 and 2.21 with respect to itsparticipation in the Commitments and the Loans outstanding from time to time as if such Participant were a Lender; provided that, in the caseof Section 2.20, such Participant shall have complied with the requirements of Section 2.20(e); and provided, further, that no Participant shallbe entitled to receive any greater amount pursuant to any such Section than the transferor Lender would have been entitled to receive inrespect of the amount of the participation transferred by such transferor Lender to such Participant had no such transfer occurred.

(c) Any Lender (an "Assignor") may, in accordance with applicable law and upon written notice to the Administrative Agent, at anytime and from time to time assign to (i) an Arranger and its affiliates, (ii) any Lender or any Lender Affiliate or Affiliated Fund of theassigning Lender or another Lender thereof (each, an "Eligible Assignee") or, (iii) with the consent of the Administrative Agents, and if noEvent of Default has occurred and is continuing, the Borrower (which, in each case, shall not be unreasonably withheld or delayed), to anadditional bank, financial institution or other entity (an

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"Assignee") all or any part of its rights and obligations under this Agreement pursuant to an Assignment and Acceptance, substantially in theform of Exhibit D (an "Assignment and Acceptance"), executed by such Assignee and such Assignor (and, where the consent of the Borrower,or the Administrative Agent is required pursuant to the foregoing provisions, by the Borrower and such other Persons) and delivered to theAdministrative Agent for its acceptance and recording in the Register together with a processing and recordation fee of $3,500; provided thatno such assignment to an Assignee (other than any Lender or any Lender Affiliate thereof or Affiliated Fund of any Lender) shall be in anaggregate principal amount of less than $1,000,000 (with respect to Tranche A Term Loans and Tranche A Term Loan Commitments and$2,500,000 with respect to all other Loans and Commitments (other than, in each case, in the case of an assignment of all of a Lender'sinterests under this Agreement), unless otherwise agreed by the Borrower and the Administrative Agent. Any such assignment need not beratable as among the Facilities. Upon such execution, delivery, acceptance and recording, from and after the effective date determinedpursuant to such Assignment and Acceptance, (x) the Assignee thereunder shall be a party hereto and, to the extent provided in suchAssignment and Acceptance, have the rights and obligations of a Lender hereunder with Commitments and/or Loans as set forth therein, and(y) the Assignor thereunder shall, to the extent provided in such Assignment and Acceptance, be released from its obligations under thisAgreement (and, in the case of an Assignment and Acceptance covering all of an Assignor's rights and obligations under this Agreement, suchAssignor shall cease to be a party hereto, except as to Section 2.19, 2.20, 2.21, 9.12 and 10.5 in respect of the period prior to such effectivedate). Notwithstanding any provision of this Section, the consent of the Borrower shall not be required for any assignment that occurs at anytime when any Event of Default shall have occurred and be continuing.

(d) The Administrative Agent shall, on behalf of the Borrower, maintain at its address referred to in Section 10.2 a copy of eachAssignment and Acceptance delivered to it and a register (the "Register") for the recordation of the names and addresses of the Lenders andthe Commitment of, and principal amount of the Loans owing to, each Lender from time to time. The entries in the Register shall beconclusive, in the absence of manifest error, and the Borrower, each Agent and the Lenders shall treat each Person whose name is recorded inthe Register as the owner of the Loans and any Notes evidencing such Loans recorded therein for all purposes of this Agreement. Anyassignment of any Loan, whether or not evidenced by a Note, shall be effective only upon appropriate entries with respect thereto being madein the Register (and each Note shall expressly so provide). Any assignment or transfer of all or part of a Loan evidenced by a Note shall beregistered on the Register only upon surrender for registration of assignment or transfer of the Note evidencing such Loan, accompanied by aduly executed Assignment and Acceptance; thereupon one or more new Notes in the same aggregate principal amount shall be issued to thedesignated Assignee (if requested by such Assignee), and the old Notes shall be returned by the Administrative Agent to the Borrower marked"canceled". The Register shall be available for inspection by the Borrower or any Lender (with respect to any entry relating to such Lender'sLoans) at any reasonable time and from time to time upon reasonable prior notice.

(e) Upon its receipt of an Assignment and Acceptance executed by an Assignor and an Assignee (and, in any case where the consent ofany other Person is required by Section 10.6(c), by each such other Person) together with any tax forms required under Section 2.20 andpayment to the Administrative Agent of a registration and processing fee of $3,500 (except that no such registration and processing fee shallbe payable in the case of an Assignee which is already a Lender or is a Lender Affiliate or an Affiliated Fund (and in the case of assignmentson the same day from a Lender to more than one fund managed or advised by the same investment advisor (which funds are not then Lendershereunder), only a single $3,500 registration and processing fee shall be payable for all such assignments by such Lender to such funds)), theAdministrative Agent shall (i) promptly accept such Assignment and Acceptance and (ii) on the effective date determined pursuant theretorecord the information contained therein in the Register and give notice of such acceptance and recordation to the Borrower. On or prior tosuch effective date, the Borrower, at its own expense, upon request, shall execute and deliver to the Administrative Agent (in exchange for theRevolving Credit Note and/or applicable Term Notes, as the case may be, of the assigning

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Lender) a new Revolving Credit Note and/or applicable Term Notes, as the case may be, such Assignee or its registered assigns in an amountequal to the Revolving Credit Commitment and/or applicable Tranche A Term Loans, as the case may be, assumed or acquired by it pursuantto such Assignment and Acceptance and, if the Assignor has retained a Revolving Credit Commitment and/or Tranche A Term Loans, as thecase may be, upon request, a new Revolving Credit Note or Term Note, as the case may be, the Assignor or its registered assigns in an amountequal to the Revolving Credit Commitment or applicable Tranche A Term Loans, as the case may be, retained by it hereunder. Such new Noteor Notes shall be dated the Closing Date and shall otherwise be in the form of the Note or Notes replaced thereby.

(f) For the avoidance of doubt, the parties to this Agreement acknowledge that the provisions of this Section concerning assignments ofLoans and Notes relate only to absolute assignments and that such provisions do not prohibit assignments creating security interests in Loansand Notes, including any pledge or assignment by a Lender of any Loan or Note to any Federal Reserve Bank in accordance with applicablelaw, provided that no such pledge or assignment of a security interest shall release a Lender from any of its obligations hereunder or substituteany such pledgee or Assignee for such Lender as a party hereto. In the case of any Lender that is a fund that invests in bank loans, such Lendermay, without the consent of the Borrower or the Administrative Agent, assign or pledge all or any portion of its rights under this Agreement,including the Loans and Notes or any other instrument evidencing its rights as a Lender under this Agreement, to any holder of, trustee for, orany other representative of holders of, obligations owed or securities issued, by such fund as security for such obligations or securities;provided that any foreclosure or similar action by such trustee or representative shall be subject to the provisions of this Section 10.6concerning assignments.

(g) Notwithstanding anything to the contrary contained herein, any Lender (a "Granting Lender") may grant to a special purpose fundingvehicle (an "SPC"), identified as such in writing from time to time by the Granting Lender to the Administrative Agent and the Borrower, theoption to provide to the Borrower all or any part of any Loan that such Granting Lender would otherwise be obligated to make to the Borrowerpursuant to this Agreement; provided that (i) nothing herein shall constitute a commitment by any SPC to make any Loan and (ii) if an SPCelects not to exercise such option or otherwise fails to provide all or any part of such Loan, the Granting Lender shall be obligated to makesuch Loan pursuant to the terms hereof. The making of a Loan by an SPC hereunder shall utilize the Commitment of the Granting Lender tothe same extent, and as if, such Loan were made by such Granting Lender. Each party hereto hereby agrees that no SPC shall be liable for anyindemnity or similar payment obligation under this Agreement (all liability for which shall remain with the Granting Lender). In furtheranceof the foregoing, each party hereto hereby agrees (which agreement shall survive the termination of this Agreement) that, prior to the date thatis one year and one day after the payment in full of all outstanding commercial paper or other indebtedness of any SPC, it will not instituteagainst, or join any other person in instituting against, such SPC any bankruptcy, reorganization, arrangement, insolvency or liquidationproceedings under the laws of the United States or any state thereof. In addition, notwithstanding anything to the contrary in thisSection 10.6(g), any SPC may (A) with notice to, but without the prior written consent of, the Borrower and the Administrative Agent andwithout paying any processing fee therefor, assign all or a portion of its interests in any Loans to the Granting Lender, or with the prior writtenconsent of the Borrower and the Administrative Agent (which consent shall not be unreasonably withheld) to any financial institutionsproviding liquidity and/or credit support to or for the account of such SPC to support the funding or maintenance of Loans, and (B) disclose ona confidential basis any non-public information relating to its Loans to any rating agency, commercial paper dealer or provider of any surety,guarantee or credit or liquidity enhancement to such SPC; provided that non-public information with respect to Holdings, the Borrower and itsSubsidiaries may be disclosed only with the Borrower's consent which will not be unreasonably withheld. This paragraph (g) may not beamended without the written consent of any SPC with Loans outstanding at the time of such proposed amendment.

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10.7 Adjustments; Set-off. (a) Except to the extent that this Agreement provides for payments to be allocated to a particular Lender orto the Lenders under a particular Facility, if any Lender (a "Benefitted Lender") shall at any time receive any payment of all or part of theObligations owing to it, or receive any collateral in respect thereof (whether voluntarily or involuntarily, by set off, pursuant to events orproceedings of the nature referred to in Section 8(f), or otherwise), in a greater proportion than any such payment to or collateral received byany other Lender, if any, in respect of such other Lender's Obligations, such Benefitted Lender shall purchase for cash from the other Lendersa participating interest in such portion of each such other Lender's Obligations, or shall provide such other Lenders with the benefits of anysuch collateral, as shall be necessary to cause such Benefitted Lender to share the excess payment or benefits of such collateral ratably witheach of the Lenders; provided, however, that if all or any portion of such excess payment or benefits is thereafter recovered from suchBenefitted Lender, such purchase shall be rescinded, and the purchase price and benefits returned, to the extent of such recovery, but withoutinterest.

(b) In addition to any rights and remedies of the Lenders provided by law, if an Event of Default shall have occurred and be continuingunder Section 8(a) or 8(f), each Lender shall have the right, without prior notice to Holdings or the Borrower, any such notice being expresslywaived by Holdings and the Borrower to the extent permitted by applicable law, upon any amount to the extent due and payable by Holdingsor the Borrower hereunder (whether at the stated maturity or by acceleration), to set off and appropriate and apply against such amount anyand all deposits (general or special, time or demand, provisional or final, other than trust accounts), in any currency, and any other credits,indebtedness or claims, in any currency, in each case whether direct or indirect, absolute or contingent, matured or unmatured, at any timeheld or owing by such Lender or any branch or agency thereof to or for the credit or the account of Holdings or the Borrower, as the case maybe. Each Lender agrees to notify promptly the Borrower and the Administrative Agent after any such setoff and application made by suchLender, provided that the failure to give such notice shall not affect the validity of such setoff and application.

10.8 Counterparts. This Agreement may be executed by one or more of the parties to this Agreement on any number of separatecounterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instrument. Delivery of an executedsignature page of this Agreement or of a Lender Addendum by facsimile transmission shall be effective as delivery of a manually executedcounterpart hereof. A set of the copies of this Agreement signed by all the parties shall be lodged with the Borrower and the AdministrativeAgent.

10.9 Severability. Any provision of this Agreement that 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 suchprohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

10.10 Integration. This Agreement, together with the Fee Letter (other than Section 2 thereof), Sections 5, 6, 8 and 10 of theSyndication Letter Agreement, the Letter Agreement and the other Loan Documents represent the entire agreement of Holdings, the Borrower,the Agents, the Arrangers and the Lenders with respect to the subject matter hereof and thereof, and there are no promises, undertakings,representations or warranties by the Arrangers, any Agent or any Lender relative to the subject matter hereof not expressly set forth or referredto herein or in the other Loan Documents.

10.11 GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THISAGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THESTATE OF NEW YORK.

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10.12 Submission To Jurisdiction; Waivers. Each of the parties hereto hereby irrevocably and unconditionally:

(a) submits for itself and its Property in any legal action or proceeding relating to this Agreement and the other Loan Documents towhich it is a party, or for recognition and enforcement of any judgment in respect thereof, to the non exclusive general jurisdiction of thecourts of the State of New York, the courts of the United States of America for the Southern District of New York, and appellate courts fromany thereof;

(b) consents that any such action or proceeding may be brought in such courts and waives any objection that it may now or hereafterhave to the venue of any such action or proceeding in any such court or that such action or proceeding was brought in an inconvenient courtand agrees not to plead or claim the same;

(c) agrees that service of process in any such action or proceeding may be effected by mailing a copy thereof by registered or certifiedmail (or any substantially similar form of mail), postage prepaid, to such party at its address specified in Section 10.2;

(d) agrees that nothing herein shall affect the right to effect service of process in any other manner permitted by law or shall limit theright to sue in any other jurisdiction; and

(e) waives, to the maximum extent not prohibited by law, any right it may have to claim or recover in any legal action or proceedingreferred to in this Section any special, exemplary, punitive or consequential damages.

10.13 Acknowledgments. Each of the parties hereto hereby acknowledges that:

(a) it has been advised by counsel in the negotiation, execution and delivery of this Agreement and the other Loan Documents;

(b) neither the Arrangers, any Agent nor any Lender has any fiduciary relationship with or duty to Holdings or the Borrower arising outof or in connection with this Agreement or any of the other Loan Documents, and the relationship between the Arrangers, the Agents and theLenders, on one hand, and Holdings and the Borrower, on the other hand, in connection herewith or therewith is solely that of debtor andcreditor; and

(c) no joint venture is created hereby or by the other Loan Documents or otherwise exists by virtue of the transactions contemplatedhereby among the Arrangers, the Agents and the Lenders or among Holdings, the Borrower and the Lenders.

10.14 Confidentiality. Each of the Arrangers, the Agents and the Lenders agrees to keep confidential all non-public informationprovided to it by any Loan Party or any of such Loan Party's attorneys, agents or accountants pursuant to this Agreement that is designated bysuch Loan Party as confidential; provided that nothing herein shall prevent the Arrangers, any Agent or any Lender from disclosing any suchinformation (a) to (i) the Arrangers, any Agent or any other Lender or (ii) any Lender Affiliate of any thereof that is obligated to hold suchinformation in confidence (subject, in the case of such disclosure to any Lender Affiliate of an Agent, Arranger or Lender, to the applicableArranger, Agent or Lender being responsible for compliance by such Lender Affiliate with the provisions of this Section 10.14), (b) to anyParticipant or Assignee (each, a "Transferee") or prospective Transferee that agrees to comply with the provisions of this Section 10.14, (c) toany of its employees, directors, consultants and representatives who are informed of the confidential nature of such information and aredirected to hold such information in confidence, (d) to any financial institution that is a direct or indirect contractual counterparty in swapagreements or such contractual counterparty's professional advisor (so long as such contractual counterparty agrees to be bound by theprovisions of this Section 10.14) (e) upon the request or demand of any Governmental Authority having jurisdiction over it, (f) in response toany order of any court or other Governmental Authority or as may otherwise be required pursuant to any Requirement of Law, (g) if

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requested or required to do so in connection with any litigation or similar proceeding, (h) that has been publicly disclosed other than in breachof this Section, (i) to the National Association of Insurance Commissioners or any similar organization or any nationally recognized ratingagency that requires access to information about a Lender's investment portfolio in connection with ratings issued with respect to such Lenderor (j) in connection with the exercise of any remedy hereunder or under any other Loan Document. The agreements in this Section 10.14 shallsurvive repayment of the Loans and all other amounts payable hereunder.

10.15 Release of Collateral and Guarantee Obligations. (a) If any of the Collateral shall be Disposed of by any Loan Party in atransaction permitted by this Agreement and the other Loan Documents, or upon the effectiveness of any written consent to the release of anyLien created under any Security Document in respect of any Collateral pursuant to and in accordance with the requirements of this Agreementand the other Loan Documents, all Liens created hereunder in such Collateral shall be automatically released, all without delivery of anyinstrument or performance of any act by any party. Any Subsidiary Guarantor shall be automatically released from its obligations hereunderand under the other Loan Documents, and all Liens created hereunder in the Collateral owned by, and in the Capital Stock issued by, suchGuarantor shall be automatically released, all without delivery of any instrument or performance of any act by any party, upon consummationof any transaction permitted by this Agreement as a result of which such Guarantor ceases to be a Subsidiary. In connection with anytermination or release pursuant to this paragraph (a), the Administrative Agent shall execute and deliver to each applicable Loan Party, at suchLoan Party's sole expense, all documents as such Loan Party shall reasonably request to evidence such termination or release; provided thatthe Borrower shall have delivered to the Administrative Agent, at least five Business Days prior to the date of the proposed termination orrelease (or such shorter period agreed to by the Administrative Agent), a written request for termination or release identifying the relevantCollateral being Disposed of in such Disposition or Subsidiary ceasing to be such and the terms thereof in reasonable detail, including the datethereof and the price thereof, together with a certification by the Borrower stating that such transaction is in compliance with this Agreementand the other Loan Documents and that the proceeds of such Disposition will be applied in accordance with this Agreement and the otherLoan Documents.

(b) Notwithstanding anything to the contrary contained herein or any other Loan Document, when all Obligations (other thanObligations in respect of any Specified Hedge Agreement and any unmatured contingent reimbursement and indemnification Obligations)have been paid in full, all Commitments have terminated or expired and no Letter of Credit shall be outstanding, the Collateral shall beautomatically released from the Liens created hereby, and the Guarantee Obligations hereunder or under any Loan Document of anyGuarantor shall be terminated. At the request of any Loan Party, the Administrative Agent shall (without notice to, or vote or consent of, anyLender, or any Qualified Counterparty) take such actions as shall be reasonably necessary or desirable to release its security interest in allCollateral, and to release all guarantee obligations provided for in any Loan Document, whether or not on the date of such release there maybe outstanding Obligations in respect of Specified Hedge Agreements. Any such release of guarantee obligations shall be deemed subject tothe provision that such guarantee obligations shall be reinstated if after such release any portion of any payment in respect of the Obligationsguaranteed thereby shall be rescinded or must otherwise be restored or returned upon the insolvency, bankruptcy, dissolution, liquidation orreorganization of the Borrower or any Guarantor, or upon or as a result of the appointment of a receiver, intervenor or conservator of, ortrustee or similar officer for, the Borrower or any Guarantor or any substantial part of its property, or otherwise, all as though such paymenthad not been made.

10.16 Accounting Changes. In the event that any "Accounting Change" (as defined below) shall occur and such change results in achange in the method of calculation of financial covenants, standards or terms in this Agreement and if the Borrower notifies theAdministrative Agent that the Borrower wishes to or the Administrative Agent notifies the Borrower that the Required Lenders wish to,amend any financial

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covenants, standards or terms in this Agreement to eliminate the effect of such Accounting Change, then Holdings, the Borrower and theAdministrative Agent agree to enter into negotiations in order to amend such provisions of this Agreement so as to equitably reflect suchAccounting Change with the desired result that the criteria for evaluating Holdings' and the Borrower's financial condition shall be the sameafter such Accounting Change as if such Accounting Change had not been made. Until such time as such an amendment shall have beenexecuted and delivered by Holdings and the Borrower, the Administrative Agent and the Required Lenders (or the Borrower or theAdministrative Agent, as the case may be, shall have withdrawn their request for an amendment), all financial covenants, standards and termsin this Agreement shall continue to be calculated or construed as if such Accounting Change had not occurred. "Accounting Change" refers toany change in accounting principles required or permitted by the promulgation of any rule, regulation, pronouncement or opinion by theFinancial Accounting Standards Board of the American Institute of Certified Public Accountants or, if applicable, the SEC.

10.17 Delivery of Lender Addenda. Each initial Lender shall become a party to this Agreement by delivering to the AdministrativeAgent a Lender Addendum duly executed by such Lender, the Borrower and the Administrative Agent.

10.18 Construction. Each covenant contained herein shall be construed (absent express provision to the contrary) as being independentof each other covenant contained herein, so that compliance with any one covenant shall not (absent such an express contrary provision) bedeemed to excuse compliance with any other covenant. Where any provision herein refers to action to be taken by any Person, or which suchPerson is prohibited from taking, such provision shall be applicable whether such action is taken directly or indirectly by such Person.

10.19 WAIVERS OF JURY TRIAL. HOLDINGS, THE BORROWER, THE ARRANGERS, THE AGENTS AND THELENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION ORPROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY COUNTERCLAIMTHEREIN.

10.20 Customer Identification�USA PATRIOT Act Notice. The Administrative Agent (for itself and not on behalf of any other party),the Syndication Agent (for itself and not on behalf of any other party) and each Lender hereby notifies the Loan Parties that, pursuant to therequirements of the USA PATRIOT Act, Title III of Pub. L. 107-56, signed into law October 26, 2001 (the "Act"), it is required to obtain,verify and record information that identifies the Loan Parties, which information includes the name and address of the Loan Parties and otherinformation that will allow the Administrative Agent, the Syndication Agent or such Lender, as applicable, to identify the Loan Parties inaccordance with the Act.

10.21 Transaction/Spin-Off. Nothing in this Agreement or the other Loan Documents shall prohibit the consummation of theTransaction.

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

TRONOX INCORPORATED

By:

Name: Mary MikkelsonTitle: Senior Vice President and Chief Financial Officer


By:

Name: Mary MikkelsonTitle: Senior Vice President and Chief Financial Officer

LEHMAN COMMERCIAL PAPER INC.,as Administrative Agent

By:

Name:Title:

LEHMAN BROTHERS INC.,as Joint Lead Arranger

By:

Name:Title:

CREDIT SUISSE,Cayman Islands Branch,as Joint Lead Arranger

By:

Name:Title:

By:

Name:Title:

[SYNDICATION AGENT]

[DOCUMENTATION AGENTS]



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QuickLinks

EXHIBIT 10.10TABLE OF CONTENTS




EXHIBIT 10.11

TRONOX WORLDWIDE LLC,

TRONOX FINANCE CORP.,

THE GUARANTORS PARTIES HERETO,

AND

CITIBANK, N.A.,AS TRUSTEE

% Senior Notes due 2012

FORM OF

INDENTURE

Dated as of November , 2005



TABLE OF CONTENTS

Page

ARTICLE I DEFINITIONS AND INCORPORATION BY REFERENCE 1Section 1.1. Definitions 1Section 1.2. Other Definitions 22Section 1.3. Incorporation by Reference of Trust Indenture Act 24Section 1.4. Rules of Construction 25

ARTICLE II THE NOTES 25Section 2.1. Form, Dating and Terms 25Section 2.2. Execution and Authentication 29Section 2.3. Registrar and Paying Agent 30Section 2.4. Paying Agent to Hold Money in Trust 30Section 2.5. Holder Lists 31Section 2.6. Transfer and Exchange 31

Section 2.7.Form of Certificates to be Delivered in Connection with Transfers Pursuant to RegulationS and Rule 144A

34

Section 2.8. Mutilated, Destroyed, Lost or Wrongfully Taken Notes 35Section 2.9. Outstanding Notes 36Section 2.10. Cancellation 36Section 2.11. Payment of Interest; Defaulted Interest 36Section 2.12. Computation of Interest 37Section 2.13. CUSIP Numbers 37

ARTICLE III COVENANTS 37Section 3.1. Payment of Notes 37Section 3.2. Reports 38Section 3.3. Incurrence of Indebtedness and Issuance of Preferred Stock 38Section 3.4. Restricted Payments 42Section 3.5. Liens 45Section 3.6. Dividend and Other Payment Restrictions Affecting Subsidiaries 45Section 3.7. Asset Sales 47Section 3.8. Transactions with Affiliates 49Section 3.9. Change of Control 50Section 3.10. Future Note Guarantees 51Section 3.11. Sale and Leaseback Transactions 52Section 3.12. Business Activities 52Section 3.13. Designation of Restricted and Unrestricted Subsidiaries 52Section 3.14. Maintenance of Office or Agency 52Section 3.15. Corporate Existence 53Section 3.16. Payment of Taxes and Other Claims 53Section 3.17. Compliance Certificate 53Section 3.18. Further Instruments and Acts 53Section 3.19. Statement by Officers as to Default 54Section 3.20. Payments for Consent 54Section 3.21. Restrictions on Activities of Tronox Finance 54Section 3.22. Elimination of Covenants 54



ARTICLE IV SUCCESSOR COMPANY 54Section 4.1. Merger, Consolidation or Sale of Assets 54

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ARTICLE V REDEMPTION OF NOTES 55Section 5.1. Optional Redemption 55Section 5.2. Applicability of Article 56Section 5.3. Election to Redeem; Notice to Trustee 56Section 5.4. Selection by Trustee of Notes to Be Redeemed 56Section 5.5. Notice of Redemption 56Section 5.6. Deposit of Redemption Price 57Section 5.7. Notes Payable on Redemption Date 57Section 5.8. Notes Redeemed in Part 58

ARTICLE VI DEFAULTS AND REMEDIES 58Section 6.1. Events of Default 58Section 6.2. Acceleration 59Section 6.3. Other Remedies 60Section 6.4. Waiver of Past Defaults 60Section 6.5. Control by Majority 60Section 6.6. Limitation on Suits 61Section 6.7. Rights of Holders to Receive Payment 61Section 6.8. Collection Suit by Trustee 61Section 6.9. Trustee May File Proofs of Claim 61Section 6.10. Priorities 62Section 6.11. Undertaking for Costs 62Section 6.12. Additional Payments 62Section 6.13. Waiver of Stay, Extension and Usury Laws 62

ARTICLE VII TRUSTEE 63Section 7.1. Duties of Trustee 63Section 7.2. Rights of Trustee 64Section 7.3. Individual Rights of Trustee 65Section 7.4. Trustee's Disclaimer 65Section 7.5. Notice of Defaults 65Section 7.6. Reports by Trustee to Holders 65Section 7.7. Compensation and Indemnity 65Section 7.8. Replacement of Trustee 66Section 7.9. Successor Trustee by Merger 66Section 7.10. Eligibility; Disqualification 67Section 7.11. Preferential Collection of Claims Against Issuers 67

ARTICLE VIII LEGAL DEFEASANCE AND COVENANT DEFEASANCE 67Section 8.1. Option to Effect Legal Defeasance or Covenant Defeasance 67Section 8.2. Legal Defeasance and Discharge 67Section 8.3. Covenant Defeasance 68Section 8.4. Conditions to Legal or Covenant Defeasance 68

Section 8.5.Deposited Cash and Government Securities to be Held in Trust; Other MiscellaneousProvisions

69

Section 8.6. Repayment to Company 69Section 8.7. Reinstatement 70

ARTICLE IX AMENDMENTS 70Section 9.1. Without Consent of Holders 70



Section 9.2. With Consent of Holders 71Section 9.3. Compliance with Trust Indenture Act 71Section 9.4. Revocation and Effect of Consents and Waivers 71

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Section 9.5. Notation on or Exchange of Notes 72Section 9.6. Trustee To Sign Amendments 72

ARTICLE X NOTE GUARANTEE 72Section 10.1. Note Guarantee 72Section 10.2. Limitation on Liability; Termination, Release and Discharge 73Section 10.3. Limitation of Guarantors' Liability 74Section 10.4. Contribution 74

ARTICLE XI SATISFACTION AND DISCHARGE 75Section 11.1. Satisfaction and Discharge 75

ARTICLE XII MISCELLANEOUS 75Section 12.1. Trust Indenture Act Controls 75Section 12.2. Notices 75Section 12.3. Communication by Holders with other Holders 76Section 12.4. Certificate and Opinion as to Conditions Precedent 76Section 12.5. Statements Required in Certificate or Opinion 77Section 12.6. When Notes Disregarded 77Section 12.7. Rules by Trustee, Paying Agent and Registrar 77Section 12.8. Legal Holidays 77Section 12.9. GOVERNING LAW 77Section 12.10. No Recourse Against Others 77Section 12.11. Successors 77Section 12.12. Multiple Originals 77Section 12.13. Qualification of Indenture 77Section 12.14. Severability 78Section 12.15. No Adverse Interpretation of Other Agreements 78Section 12.16. Table of Contents; Headings 78Section 12.17. Rights of Paying Agent and Registrar 78

EXHIBIT A Form of the NoteEXHIBIT B Form of the Exchange NoteEXHIBIT C Form of Supplemental Indenture

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CROSS-REFERENCE TABLE

TIASection

IndentureSection

310(a)(1) 7.10(a)(2) 7.10(a)(3) N/A(a)(4) N/A.(b) 7.8; 7.10(c) N/A311(a) 7.11(b) 7.11(c) N/A312(a) 2.5(b) 12.3(c) 12.3313(a) 7.6(b)(1) 7.6(b)(2) 7.6(c) 7.6(d) 7.6314(a) 3.2; 12.2(b) N/A(c)(1) 11.4(c)(2) 11.4(c)(3) N/A(d) N/A(e) 12.5315(a) 7.1(b) 7.5; 12.2(c) 7.1(d) 7.1(e) 6.11316(a)(last sentence) 12.6(a)(1)(A) 6.5(a)(1)(B) 6.4(a)(2) N/A(b) 6.7317(a)(1) 6.8(a)(2) 6.9(b) 2.4318(a) 12.1

N/A means Not Applicable.

Note: This Cross-Reference Table shall not, for any purpose, be deemed to be part of this Indenture.

iv



FORM OF INDENTURE dated as of November , 2005, among TRONOX WORLDWIDE LLC, a Delaware limited liability company(the "Company"), TRONOX FINANCE CORP., a Delaware corporation ("Tronox Finance" and, together with the Company, the "Issuers"),TRONOX INCORPORATED, a Delaware corporation ("Parent"), each other Guarantor (as defined herein) from time to time party hereto andCITIBANK, N.A., a national banking association, as trustee (the "Trustee").

Each party agrees as follows for the benefit of the other parties and for the equal and ratable benefit of the Holders of (i) the Issuers' %Senior Notes due 2012, issued on the date hereof (the "Initial Notes"), (ii) if and when issued, an unlimited principal amount of additional %Senior Notes due 2012 of the Issuers in a non-registered offering or in a registered offering of the Issuers that may be offered from time totime subsequent to the date hereof (the "Additional Notes") and (iii) if and when issued, the Issuers' % Senior Notes due 2012 that may beissued from time to time in exchange for Initial Notes or any Additional Notes in an offer registered under the Securities Act as provided inthe Registration Rights Agreement (as hereinafter defined) (the "Exchange Notes," and together with the Initial Notes and Additional Notes,the "Notes").

ARTICLE I

Definitions and Incorporation by Reference

Section 1.1. Definitions.

"Acquired Debt" means, with respect to any specified Person:

(1) Indebtedness of any other Person existing at the time such other Person is merged with or into or became a Subsidiary of suchspecified Person, whether or not such Indebtedness is incurred in connection with, or in contemplation of, such other Personmerging with or into, or becoming a Restricted Subsidiary of, such specified Person; and

(2) Indebtedness secured by a Lien encumbering any asset acquired by such specified Person.

"Additional Assets" means:

(1) any property or assets (other than indebtedness and Capital Stock) to be used by the Company or any of its RestrictedSubsidiaries in a Permitted Business;

(2) the Capital Stock of a Person that becomes a Restricted Subsidiary as a result of the acquisition of such Capital Stock by theCompany or any of its Restricted Subsidiaries; or

(3) Capital Stock constituting a minority interest in any Person that at such time is a Restricted Subsidiary of the Company;

provided, however, that, in the case of clauses (2) and (3), such Restricted Subsidiary is primarily engaged in a Permitted Business.

"Affiliate" of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirectcommon control with such specified Person. For purposes of this definition, "control," as used with respect to any Person, means thepossession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether throughthe ownership of voting securities, by agreement or otherwise; provided that beneficial ownership of 10% or more of the Voting Stock of aPerson will be deemed to be control. For purposes of this definition, the terms "controlling," "controlled by" and "under common control with"have correlative meanings.

"Asset Sale" means:



(1) the sale, lease, conveyance or other disposition of any assets or rights of the Issuers or of any Restricted Subsidiary; providedthat the sale, lease, conveyance or other disposition of the Company, or all or substantially all of the assets of the Companyand its Restricted Subsidiaries

1



taken as a whole will be governed by Section 3.9 and/or Section 4.1, if applicable, and not by Section 3.7; and

(2) the issuance of Equity Interests in any of the Company's Restricted Subsidiaries or the sale of Equity Interests in any of itsSubsidiaries (other than directors' qualifying shares and shares required by applicable law to be held by a Person other than theCompany or any of its Restricted Subsidiaries).

Notwithstanding the preceding, none of the following items will be deemed to be an Asset Sale:

(1) any single transaction or series of related transactions that involves assets having a Fair Market Value of less than $5.0 million;

(2) a transfer of assets between or among the Company and its Restricted Subsidiaries;

(3) an issuance of Equity Interests by a Restricted Subsidiary of the Company to the Company or to a Restricted Subsidiary of theCompany;

(4) the sale or lease of products, services or accounts receivable in the ordinary course of business and any sale or otherdisposition of damaged, worn-out or obsolete assets in the ordinary course of business;

(5) the sale or other disposition of cash or Cash Equivalents;

(6) a Restricted Payment that does not violate Section 3.4;

(7) a Permitted Investment;

(8) the granting of Liens not prohibited by this Indenture and the foreclosure thereon;

(9) any surrender or waiver of contract rights or the settlement release or surrender of contract, tort or other litigation claims in theordinary course of business;

(10) a sale of accounts receivable and related assets of the type specified in the definition of "Receivables Financing" to aReceivables Subsidiary in a Qualified Receivables Financing or in factoring or similar transactions;

(11) a transfer of accounts receivable and related assets of the type specified in the definition of "Receivables Financing" (or afractional undivided interest therein) by a Receivables Subsidiary in a Qualified Receivables Financing;

(12) the sale and leaseback of any assets within 180 days after the acquisition thereof;



(13) the lease, assignment or sublease of any real or personal property in the ordinary course of business consistent with pastpractice; and

(14) the licensing of intellectual property rights.

"Attributable Debt" in respect of a sale and leaseback transaction means, at the time of determination, the present value of the obligationof the lessee for net rental payments during the remaining term of the lease included in such sale and leaseback transaction including anyperiod for which such lease has been extended or may, at the option of the lessor, be extended. Such present value shall be calculated using adiscount rate equal to the rate of interest implicit in such transaction, determined in accordance with GAAP; provided, however, that if suchsale and leaseback transaction results in a Capital Lease Obligation, the amount of Indebtedness represented thereby will be determined inaccordance with the definition of "Capital Lease Obligation."

"Bankruptcy Law" means Title 11, United States Code or any similar Federal or state law for the relief of debtors.

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"Beneficial Owner" has the meaning assigned to such term in Rule 13d-3 and Rule 13d-5 under the Exchange Act, except that incalculating the beneficial ownership of any particular "person" (as that term is used in Section 13(d)(3) of the Exchange Act), such "person"will be deemed to have beneficial ownership of all securities that such "person" has the right to acquire by conversion or exercise of othersecurities, whether such right is currently exercisable or is exercisable only after the passage of time. The terms "Beneficially Owns" and"Beneficially Owned" have a corresponding meaning.

"Board of Directors" means:

(1) with respect to a corporation, the board of directors of the corporation or any committee thereof duly authorized to act onbehalf of such board;

(2) with respect to a partnership, the Board of Directors of the general partner of the partnership;

(3) with respect to a limited liability company, the managing member or members or any controlling committee of managingmembers thereof; and

(3) with respect to any other Person, the board or committee of such Person serving a similar function.

"Board Resolution" means a copy of a resolution certified by the Secretary or an Assistant Secretary of the applicable Person to havebeen duly adopted by the Board of Directors of such Person and to be in full force and effect on the date of such certification, and delivered tothe Trustee.

"Borrowing Base" means, as of the date of determination, an amount equal to:

(1) 80% of the book value of all accounts receivable owned by the Company and its Restricted Subsidiaries that are not more than90 days past due; plus

(2) 60% of the book value of all inventory owned by the Company and its Restricted Subsidiaries or scheduled for delivery againstletters of credit issued against Credit Facilities,

as set forth in the most recent quarterly or annual report, as applicable, delivered to the Trustee in accordance with this Indenture.

"Business Day" or "business day" mean each day that is not a Saturday, Sunday or other day on which banking institutions in New York,New York or the city in which, at any particular time, the Trustee conducts its corporate trust business in connection with this Indenture areauthorized or required by law to close.

"Capital Lease Obligations" means, at the time any determination is to be made, the amount of the liability in respect of a capital leasethat would at that time be required to be capitalized on a balance sheet prepared in accordance with GAAP, and the Stated Maturity thereofshall be the date of the last payment of rent or any other amount due under such lease prior to the first date upon which such lease may beprepaid by the lessee without payment of a penalty.

"Capital Stock" means:



(1) in the case of a corporation, corporate stock;

(2) in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (howeverdesignated) of corporate stock;

(3) in the case of a partnership or limited liability company, partnership interests (whether general or limited) or membershipinterests; and

(4) any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, ordistributions of assets of, the issuing Person, but excluding from all of the

3



foregoing any debt securities convertible into Capital Stock, whether or not such debt securities include any right ofparticipation with Capital Stock.

"Cash Equivalents" means:

(1) securities issued or directly and fully guaranteed or insured by the United States government or any agency or instrumentalityof the United States government (provided that the full faith and credit of the United States is pledged in support of thosesecurities) having maturities of not more than 12 months from the date of acquisition;

(2) readily marketable direct obligations issued by any state of the United States having one of the two highest rating categoriesobtainable from either Moody's or Standard & Poor's having maturities of 12 months or less from the date of acquisition;

(3) securities issued or directly and fully and unconditionally guaranteed or insured by the government or any agency orinstrumentality of the United Kingdom, the Commonwealth of Australia or any member state of the European Union whoselegal tender is the euro having maturities of not more than 12 months from the date of acquisition;

(4) certificates of deposit and eurodollar time deposits with maturities of six months or less from the date of acquisition, bankers'acceptances with maturities not exceeding six months and overnight bank deposits, in each case, with any domesticcommercial bank having capital and surplus in excess of $500.0 million and a Thomson Bank Watch Rating of "B" or better;

(5) repurchase obligations with a term of not more than seven days for underlying securities of the types described in clauses (1),(2), (3) and (4) above entered into with any financial institution meeting the qualifications specified in clause (4) above;

(6) commercial paper having one of the two highest ratings obtainable from Moody's or Standard and Poors and, in each case,maturing within twelve months after the date of acquisition;

(7) in the case of any Foreign Subsidiary, demand or time deposit accounts used in the ordinary course of business with reputablecommercial banks located in the jurisdiction of organization of such Foreign Subsidiary; and

(8) investments in any fund at least 90% of the assets of which constitute Cash or Cash Equivalents of the kinds described inclauses (1) through (6) of this definition.

"Change of Control" means the occurrence of any of the following:

(1) the direct or indirect sale, lease, transfer, conveyance or other disposition (other than by way of merger or consolidation), inone or a series of related transactions, of all or substantially all of the properties or assets of Parent or the Company and itsSubsidiaries taken as a whole to any "person" (as that term is used in Section 13(d) of the Exchange Act);

(2) the adoption of a plan relating to the liquidation or dissolution of the Company or Parent;



(3) the consummation of any transaction (including any merger or consolidation), the result of which is that any "person" (as thatterm is used in Section 13(d) of the Exchange Act) becomes the Beneficial Owner, directly or indirectly, of more than 50% ofthe Voting Stock of Parent, measured by voting power rather than number of shares;

(4) Parent consolidates with, or merges with or into, any Person, or any Person consolidates with, or merges with or into, Parent,in any such event pursuant to a transaction in which any of the outstanding Voting Stock of Parent or such other Person isconverted into or exchanged for cash, securities or other property, other than any such transaction where the Voting Stock ofParent outstanding immediately prior to such transaction is converted into or exchanged for Voting Stock (other thanDisqualified Stock) of the surviving or transferee Person constituting a majority

4



of the outstanding shares of such Voting Stock of such surviving or transferee Person (immediately after giving effect tosuch issuance);

(5) Parent fails to own 100% of the Capital Stock of the Company or the Company fails to own 100% of the Capital Stock ofTronox Finance; or

(6) during any period of two consecutive years, Continuing Directors cease to constitute a majority of the Board of Directors ofParent.

Notwithstanding the foregoing, neither the initial public offering of Parent nor the Distribution (as described in the OfferingMemorandum) shall constitute a Change of Control.

"Clearstream" means Clearstream Banking, societé anonyme (formerly Cedelbank).

"Code" means the Internal Revenue Code of 1986, as amended.

"Commission" or "SEC" means the Securities and Exchange Commission.

"Consolidated Cash Flow" means, with respect to any specified Person for any period, the Consolidated Net Income of such Person forsuch period plus, without duplication:

(1) an amount equal to any extraordinary loss plus any net loss realized by such Person or any of its Restricted Subsidiaries inconnection with an Asset Sale, to the extent such losses were deducted in computing such Consolidated Net Income; plus

(2) provision for taxes based on income or profits of such Person and its Restricted Subsidiaries for such period, to the extent thatsuch provision for taxes was deducted in computing such Consolidated Net Income; plus

(3) the Fixed Charges of such Person and its Restricted Subsidiaries for such period, to the extent that such Fixed Charges werededucted in computing such Consolidated Net Income; plus

(4) depreciation, amortization (including amortization of intangibles but excluding amortization of prepaid cash expenses thatwere paid in a prior period) and other non-cash expenses (excluding any such non-cash expense to the extent that it representsan accrual of or reserve for cash expenses in any future period) of such Person and its Restricted Subsidiaries for such periodto the extent that such depreciation, amortization and other non-cash expenses were deducted in computing such ConsolidatedNet Income; plus

(5) charges for such period related to the shut down of the Savannah Facility (as described in the Offering Memorandum); plus

(6) all one-time fees, costs, expenses (including cash compensation payments), in each case incurred during such period by theCompany and its Restricted Subsidiaries in connection with or resulting from (i) Parent's separation from Kerr-McGeeCorporation and Parent's initial public offering and the transactions related thereto, and (ii) the Distribution; plus



(7) non-cash compensation charges for such period, including any such charges arising from stock options, restricted stock grantsor other equity-incentive programs; plus

(8) losses for such period from operations discontinued prior to the Issue Date to the extent that such expenses were deducted incomputing such Consolidated Net Income (not to exceed $17.0 million in any period in the case of cash expenditures); plus

(9) losses, to the extent comparable to interest expense, for such period on the sales of accounts receivable under an assetsecuritization program or a factoring program to the extent that such expenses were deducted in computing such ConsolidatedNet Income; plus

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(10) non-cash environmental remediation and restoration expense (net of reimbursement) of such Person and its RestrictedSubsidiaries for such period to the extent that such expenses were deducted in computing such Consolidated Net Income andrepresent an accrual of or reserve for cash expenses in any future period; minus

(11) non-cash items increasing such Consolidated Net Income for such period, other than the accrual of revenue in the ordinarycourse of business,

in each case, on a consolidated basis and determined in accordance with GAAP.

Notwithstanding the preceding sentence, clauses (1) through (11) above relating to amounts of a Restricted Subsidiary of a Person will beadded to (or subtracted from) Consolidated Net Income to compute Consolidated Cash Flow of such Person only to the extent (and in the sameproportion) that the net income (loss) of such Restricted Subsidiary was included in calculating the Consolidated Net Income of such Person.

"Consolidated Net Income" means, with respect to any specified Person for any period, the aggregate of the Net Income of such Personand its Restricted Subsidiaries for such period, on a consolidated basis, determined in accordance with GAAP; provided that:

(1) the Net Income (but not loss) of any Person that is not a Restricted Subsidiary or that is accounted for by the equity method ofaccounting will be included only to the extent of the amount of dividends or similar distributions paid in cash to the specifiedPerson or a Restricted Subsidiary of such Person;

(2) the Net Income of any Restricted Subsidiary will be excluded to the extent that the declaration or payment of dividends orsimilar distributions by that Restricted Subsidiary of that Net Income is not at the date of determination permitted without anyprior governmental approval (that has not been obtained) or, directly or indirectly, by operation of the terms of its charter orany agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that RestrictedSubsidiary or its stockholders;

(3) the cumulative effect of a change in accounting principles during such period will be excluded;

(4) notwithstanding clause (1) above, the Net Income of any Unrestricted Subsidiary will be excluded, whether or not distributedto the specified Person or one of its Subsidiaries;

(5) any non-cash goodwill or other intangible asset impairment charges incurred subsequent to the Issue Date resulting from theapplication of the Financial Accounting Standards Board's Statement of Financial Accounting Standards No. 142 (or similarpronouncements) shall be excluded;

(6) any net after-tax income or loss from discontinued operations (other than losses from operations discontinued prior to the IssueDate), net after-tax gains or losses on disposal of discontinued operations and losses arising from lease dispositions shall beexcluded;

(7) items classified as extraordinary or nonrecurring gains and losses (less all fees and expenses related thereto) or expenses(including severance, relocation, other restructuring costs and expenses arising from the transactions closingcontemporaneously with this offering); and the related tax effects according to GAAP, shall be excluded; provided that withrespect to each extraordinary or nonrecurring item, the Company shall have delivered an Officers' Certificate (as to which the



Trustee shall have no responsibility to confirm or verify any information contained therein) to the Trustee specifying andquantifying such item and stating that such item is extraordinary or non-recurring; and

(8) to the extent deducted in the calculation of Net Income, any non-recurring charges associated with any premium or penaltypaid, write-offs of deferred financing costs or other financial

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recapitalization charges in connection with redeeming or retiring any indebtedness prior to its Stated Maturity will beadded back to arrive at Consolidated Net Income.

"Consolidated Net Tangible Assets" means Consolidated Tangible Assets after deducting therefrom all current liabilities, all as set forthon the most recent balance sheet of Parent delivered to the Trustee, on a consolidated basis (excluding any Subsidiaries of Parent that are notSubsidiaries of the Company), determined in accordance with GAAP.

"Consolidated Net Worth" means, with respect to any specified Person as of any date, the sum of:

(1) the consolidated equity of the common stock (or Capital Stock equivalent to common stock) of such Person and itsconsolidated Subsidiaries as of such date; plus

(2) the respective amounts reported on such Person's balance sheet as of such date with respect to any series of Preferred Stock(other than Disqualified Stock) that by its terms is not entitled to the payment of dividends unless such dividends may bedeclared and paid only out of net earnings in respect of the year of such declaration and payment, but only to the extent of anycash received by such Person upon issuance of such Preferred Stock.

"Consolidated Tangible Assets" means total assets (less accumulated depreciation and valuation reserves and other reserves and itemsdeductible from gross book value of specific asset accounts under GAAP) after deducting therefrom (1) any item representing investments inUnrestricted Subsidiaries and (2) all goodwill, trade names, trademarks, patents, unamortized debt discount, organization expenses and otherlike intangibles, all as set forth on the most recent balance sheet of Parent delivered to the Trustee, on a consolidated basis (excluding anySubsidiaries of Parent that are not Subsidiaries of the Company), determined in accordance with GAAP.

"Continuing Directors" means, as of any date of determination, any member of the Board of Directors of Parent who:

(1) was a member of such Board of Directors on the Issue Date or becomes a member of such Board in connection with theDistribution; or

(2) was nominated for election or elected to such Board of Directors with the approval of a majority of the Continuing Directorswho were members of such Board of Directors at the time of such nomination or election.

"Company" has the meaning ascribed to it in the first introductory paragraph of this Indenture.

"Credit Agreement" means that certain Credit Agreement, dated as of the Issue Date, by and among the Issuers, the lenders andguarantors party thereto and Lehman Commercial Paper Inc., as Administrative Agent, providing for up to $450.0 million of revolving creditand term loan borrowings, including any related notes, Guarantees, collateral documents, instruments and agreements executed in connectiontherewith, and, in each case, as amended, restated, modified, renewed, refunded, replaced (whether upon or after termination or otherwise) orrefinanced (including by means of sales of debt securities to institutional investors) in whole or in part from time to time.

"Credit Facilities" means, one or more debt facilities (including the Credit Agreement) or commercial paper facilities, in each caseproviding for revolving credit loans, term loans, receivables financing (including through the sale of receivables to such lenders or to specialpurpose entities formed to borrow from such lenders against such receivables) or letters of credit, in each case, as amended, restated, modified,renewed, refunded, replaced (whether upon or after termination or otherwise) or refinanced (including by means of sales of debt securities toinstitutional investors) in whole or in part from time to time.

"Custodian" means any receiver, trustee, assignee, liquidator, custodian or similar official under any Bankruptcy Law.

"Default" means any event that is, or with the passage of time or the giving of notice or both would be, an Event of Default.



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"Definitive Note" means a certificated Note registered in the name of the Holder thereof and issued in accordance with Section 2.1hereof, in the form of Exhibit A hereto except that such Note shall not bear the Global Note Legend.

"Disqualified Stock" means any Capital Stock that, by its terms (or by the terms of any security into which it is convertible, or for whichit is exchangeable, in each case, at the option of the holder of the Capital Stock), or upon the happening of any event, matures or ismandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at the option of the holder of the Capital Stock, inwhole or in part, on or prior to the date that is 91 days after the date on which the Notes mature. Notwithstanding the preceding sentence, anyCapital Stock that would constitute Disqualified Stock solely because the holders of the Capital Stock have the right to require the Companyto repurchase such Capital Stock upon the occurrence of a change of control or an asset sale will not constitute Disqualified Stock if the termsof such Capital Stock provide that the Company may not repurchase or redeem any such Capital Stock pursuant to such provisions unless suchrepurchase or redemption complies with Section 3.4. The amount of Disqualified Stock deemed to be outstanding at any time for purposes ofthis Indenture will be the maximum amount that the Company and its Restricted Subsidiaries may become obligated to pay upon the maturityof, or pursuant to any mandatory redemption provisions of, such Disqualified Stock, exclusive of accrued dividends.

"Distribution" has the meaning given such term in the Offering Memorandum.

"Domestic Subsidiary" means any Restricted Subsidiary of the Company that was formed under the laws of the United States or any stateof the United States or the District of Columbia.

"DTC" means The Depository Trust Company, its nominees and their respective successors and assigns, or such other depositaryinstitution hereinafter appointed by the Company.

"Equity Interests" means Capital Stock and all warrants, options or other rights to acquire Capital Stock (but excluding any debt securitythat is convertible into, or exchangeable for, Capital Stock).

"Equity Offering" means an offer and sale of Capital Stock (other than Disqualified Stock) of the Company or Parent pursuant to aregistration statement that has been declared effective by the SEC pursuant to the Securities Act (other than a registration statement onForm S-8 or otherwise relating to equity securities issuable under any employee benefit plan of Parent) or a valid private placement on a cashbasis after the consummation of the transactions described in the Offering Memorandum.

"Euroclear" means Morgan Guaranty Trust Company of New York, Brussels office, as operator of the Euroclear System.

"Exchange Act" means the Securities Exchange Act of 1934, as amended.

"Exchange Notes" has the meaning ascribed to it in the second introductory paragraph of this Indenture.

"Existing Indebtedness" means up to $0.4 million in aggregate principal amount of Indebtedness of the Company and its Subsidiaries(other than Indebtedness under the Credit Agreement) in existence on the Issue Date, until such amounts are repaid.

"Fair Market Value" means the value that would be paid by a willing buyer to an unaffiliated willing seller in a transaction not involvingdistress or necessity of either party, determined in good faith by the Board of Directors of the Company (unless otherwise provided in thisIndenture).

"Fixed Charge Coverage Ratio" means, with respect to any specified Person for any period, the ratio of the Consolidated Cash Flow ofsuch Person for such period to the Fixed Charges of such Person for such period. In the event that the specified Person or any of its RestrictedSubsidiaries incurs, assumes, guarantees, repays, repurchases, redeems, defeases or otherwise discharges any Indebtedness (other thanordinary working capital borrowings, and other than in the case of revolving advances under any Qualified

8



Receivables Financing, in which case interest expense shall be computed based upon the average daily balance of such Indebtedness duringthe applicable period) or issues, repurchases or redeems Preferred Stock subsequent to the commencement of the period for which the FixedCharge Coverage Ratio is being calculated and on or prior to the date on which the event for which the calculation of the Fixed ChargeCoverage Ratio is made (the "Calculation Date"), then the Fixed Charge Coverage Ratio will be calculated giving pro forma effect to suchincurrence, assumption, Guarantee, repayment, repurchase, redemption, defeasance or other discharge of Indebtedness, or such issuance,repurchase or redemption of Preferred Stock, and the use of the proceeds therefrom, as if the same had occurred at the beginning of theapplicable four-quarter reference period.

In addition, for purposes of calculating the Fixed Charge Coverage Ratio:

(1) acquisitions that have been made by the specified Person or any of its Restricted Subsidiaries, including through mergers orconsolidations, or any Person or any of its Restricted Subsidiaries acquired by the specified Person or any of its RestrictedSubsidiaries, and including any related financing transactions and including increases in ownership of Restricted Subsidiaries,during the four-quarter reference period or subsequent to such reference period and on or prior to the Calculation Date will begiven pro forma effect as if they had occurred on the first day of the four-quarter reference period and Consolidated Cash Flowfor such reference period will be calculated on a pro forma basis (giving effect to any Pro Forma Cost Savings);

(2) the Consolidated Cash Flow attributable to discontinued operations, as determined in accordance with GAAP, and operationsor businesses (and ownership interests therein) disposed of prior to the Calculation Date, will be excluded;

(3) the Fixed Charges attributable to discontinued operations, as determined in accordance with GAAP, and operations orbusinesses (and ownership interests therein) disposed of prior to the Calculation Date, will be excluded, but only to the extentthat the obligations giving rise to such Fixed Charges will not be obligations of the specified Person or any of its RestrictedSubsidiaries following the Calculation Date;

(4) any Person that is a Restricted Subsidiary on the Calculation Date will be deemed to have been a Restricted Subsidiary at alltimes during such four-quarter period;

(5) any Person that is not a Restricted Subsidiary on the Calculation Date will be deemed not to have been a Restricted Subsidiaryat any time during such four-quarter period;

(6) if any Indebtedness bears a floating rate of interest, the interest expense on such Indebtedness will be calculated as if the rate ineffect on the Calculation Date had been the applicable rate for the entire period (taking into account any Hedging Obligationapplicable to such Indebtedness if such Hedging Obligation has a remaining term as at the Calculation Date in excess of12 months);

(7) for any calculation of the Fixed Charge Coverage Ratio with a Calculation Date in 2005, Consolidated Cash Flow for theportion of the four-quarter reference period that is in the 2004 fiscal year shall be determined after giving pro forma effect tothe adjustments used to calculate pro forma Adjusted EBITDA as set forth in the Offering Memorandum; and



(8) Any Obligation incurred by a Foreign Subsidiary under or with respect to bank guarantees or similar instruments issued bybanking organizations outside the United States that are supported or backed by letters of credit issued under Credit Facilitiesunder clause (1) of the definition of Permitted Debt will not be deemed a separate incurrence of Indebtedness.

9



"Fixed Charges" means, with respect to any specified Person for any period, the sum, without duplication, of:

(1) the consolidated interest expense of such Person and its Restricted Subsidiaries for such period, whether paid or accrued,excluding amortization of debt issuance costs incurred in connection with the issuance of the Notes and the Guarantees andincluding amortization of debt issuance costs and original issue discount, non-cash interest payments, the interest componentof any deferred payment obligations, the interest component of all payments associated with Capital Lease Obligations,imputed interest with respect to Attributable Debt, commissions, discounts and other fees and charges incurred in respect ofletter of credit or bankers' acceptance financings, and net of the effect of all payments made or received pursuant to HedgingObligations in respect of interest rates; plus

(2) the consolidated interest expense of such Person and its Restricted Subsidiaries that was capitalized during such period,whether paid or accrued; plus

(3) any interest on Indebtedness of another Person that is guaranteed by such Person or one of its Restricted Subsidiaries orsecured by a Lien on assets of such Person or one of its Restricted Subsidiaries, whether or not such Guarantee or Lien iscalled upon; plus

(4) all dividends, whether paid or accrued and whether or not in cash, on any series of Preferred Stock of such Person or any of itsRestricted Subsidiaries, other than dividends on Preferred Stock payable solely in Equity Interests of the Company (other thanDisqualified Stock) or to the Company or a Restricted Subsidiary of the Company.

"Foreign Subsidiary" means any Restricted Subsidiary of the Company that is not a Domestic Subsidiary.

"GAAP" means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting PrinciplesBoard of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting StandardsBoard or in such other statements by such other entity as have been approved by a significant segment of the accounting profession, which arein effect from time to time.

"Government Securities" means direct obligations of, or obligations guaranteed by, the United States of America for the payment ofwhich obligations or guarantee the full faith and credit of the United States of America is pledged.

"Guarantee" means a guarantee other than by endorsement of negotiable instruments for collection in the ordinary course of business,direct or indirect, in any manner including by way of a pledge of assets or through letters of credit or reimbursement agreements in respectthereof, of all or any part of any Indebtedness (whether arising by virtue of partnership arrangements, or by agreements to keep-well, topurchase assets, goods, securities or services, to take or pay or to maintain financial statement conditions or otherwise), or entered into forpurposes of assuring in any other manner the obligee of such Indebtedness of the payment thereof or to protect such obligee against loss inrespect thereof (in whole or in part).

"Guarantors" means each of:

(1) Cimarron Corporation, Kerr-McGee Holdings, Inc., Kerr-McGee Minerals Resources Corporation, Kerr-McGee Pigments(Savannah) Inc., Kerr-McGee Refining Corporation, Southwestern Refining Company, Inc., Transworld Drilling Company,Triangle Refineries, Inc., Triple S, Inc. and Tronox LLC;

(2) any other wholly owned Domestic Subsidiary of the Company that executes a Note Guarantee in accordance with theprovisions of this Indenture; and



10



(3) Parent,

and their respective successors and assigns, in each case, until the Note Guarantee of such Person has been released in accordance with theprovisions of this Indenture.

"Hedging Obligations" means, with respect to any specified Person, the net obligations of such Person incurred in the ordinary course ofbusiness and not for speculative purposes under:

(1) interest rate swap agreements (whether from fixed to floating or from floating to fixed), interest rate cap agreements andinterest rate collar agreements entered into with one or more financial institutions and other arrangements or agreementsdesigned to protect the Person entering into the agreement against fluctuations in interest rates with respect to Indebtednessincurred and not for purposes of speculation;

(2) foreign exchange contracts and currency protection agreements entered into with one or more financial institutions anddesigned to protect the Person entering into the agreement against fluctuations in currency exchange rates with respect toIndebtedness incurred and not for purposes of speculation;

(3) any commodity futures contract, commodity option or other similar agreement or arrangement designed to protect againstfluctuations in the price of commodities used by that Person at the time; and

(4) other agreements or arrangements designed to protect such Person against fluctuations in interest rates or currency exchangerates.

"Holder" means a Person in whose name a Note is registered.

"Immaterial Subsidiary" means, as of any date, any Restricted Subsidiary whose total assets, as of the last day of the most recently endedfour full fiscal quarter period for which internal financial statements are available immediately preceding such date, are less than $50,000 andwhose total revenues for the most recently ended four full fiscal quarters for which internal financial statements are available immediatelypreceding such date do not exceed $50,000; provided that a Restricted Subsidiary will not be considered to be an Immaterial Subsidiary if it,directly or indirectly, guarantees or otherwise provides direct credit support for any Indebtedness of any Issuer.

"Indebtedness" means, with respect to any specified Person, any indebtedness of such Person (excluding accrued expenses and tradepayables), whether or not contingent:

(1) in respect of borrowed money;

(2) evidenced by bonds, notes, debentures or similar instruments or letters of credit (or reimbursement agreements in respectthereof);

(3) the principal component of all obligations of such Person in respect of letters of credit, bankers' acceptances or other similarinstruments (including reimbursement obligations with respect thereto);

(4) representing Capital Lease Obligations or Attributable Debt in respect of sale and leaseback transactions;



(5) representing the balance deferred and unpaid of the purchase price of any property or services due more than six months aftersuch property is acquired or such services are completed;

(6) the principal component or liquidation preference of all obligations of such Person with respect to the redemption, repaymentor other repurchase of any Disqualified Stock or, with respect to any Subsidiary, any Preferred Stock (but excluding, in eachcase, any accrued dividends);

(7) representing any Hedging Obligations;

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(8) the principal component of all Indebtedness of other Persons secured by a Lien on any asset of such Person, whether or notsuch Indebtedness is assumed by such Person; provided, however, that the amount of such Indebtedness will be the lesser of(a) the Fair Market Value of such asset at such date of determination and (b) the amount of such Indebtedness of such otherPersons; or

(9) the principal component of Indebtedness of other Persons to the extent Guaranteed by such Person.

The amount of Indebtedness of any Person at any date will be the outstanding balance at such date of all unconditional obligations asdescribed above and the maximum liability, upon the occurrence of the contingency giving rise to the obligation, of any contingent obligationsat such date.

In addition, "Indebtedness" of any Person shall include Indebtedness described in the preceding paragraph that would not appear as aliability on the balance sheet of such Person if:

(1) such Indebtedness is the obligation of a partnership or joint venture that is not a Restricted Subsidiary (a "Joint Venture");

(2) such Person or a Restricted Subsidiary of such Person is a general partner of the Joint Venture (a "General Partner"); and

(3) there is recourse, by contract or operation of law, with respect to the payment of such Indebtedness to property or assets ofsuch Person or a Restricted Subsidiary of such Person; and then such Indebtedness shall be included in an amount not toexceed:

(a) the lesser of (i) the net assets of such General Partner and (ii) the amount of such obligations to the extent that there isrecourse, by contract or operation of law, to the property or assets of such Person or a Restricted Subsidiary of suchPerson; or

(b) if less than the amount determined pursuant to clause (a) immediately above, the actual amount of such Indebtedness thatis recourse to such Person or a Restricted Subsidiary of such Person, if the Indebtedness is evidenced by a writing and isfor a determinable amount and the related interest expense shall be included in Fixed Charges to the extent actually paidby the Company or its Restricted Subsidiaries.

In addition, the term "Indebtedness" includes all Indebtedness of others secured by a Lien on any asset of the specified Person (whetheror not such Indebtedness is assumed by the specified Person) and, to the extent not otherwise included, the Guarantee by the specified Personof any Indebtedness of any other Person. Notwithstanding the preceding, "Indebtedness" shall not include accounts payable arising in theordinary course of business.

"Indenture" means this Indenture as amended or supplemented from time to time.

"Initial Notes" has the meaning ascribed to it in the second introductory paragraph of this Indenture.

"Investment Grade Rating" means a rating equal to or higher than Baa3 (or the equivalent) by Moody's or BBB (or the equivalent) byStandard & Poor's, or the equivalent by any other nationally recognized statistical rating organization.

"Investments" means, with respect to any Person, all direct or indirect investments by such Person in other Persons (including Affiliates)in the forms of loans (including Guarantees or other obligations), advances or capital contributions (excluding commission, travel and similaradvances to officers and employees made in the ordinary course of business), purchases or other acquisitions for consideration of



Indebtedness, Equity Interests or other securities, together with all items that are or would be classified as investments on a balance sheetprepared in accordance with GAAP. If the Company or any Subsidiary of the Company sells or otherwise disposes of any Equity Interests ofany direct or indirect Subsidiary of the Company such that, after giving effect to any such sale or disposition, such Person is no longer aSubsidiary

12



of the Company, the Company will be deemed to have made an Investment on the date of any such sale or disposition equal to the Fair MarketValue of the Company's Investments in such Subsidiary that were not sold or disposed of in an amount determined as provided in the finalparagraph of Section 3.4. The acquisition by the Company or any Subsidiary of the Company of a Person that holds an Investment in a thirdPerson will be deemed to be an Investment by the Company or such Subsidiary in such third Person in an amount equal to the Fair MarketValue of the Investments held by the acquired Person in such third Person in an amount determined as provided in the final paragraph ofSection 3.4. Except as otherwise provided in this Indenture, the amount of an Investment will be determined at the time the Investment ismade and without giving effect to subsequent changes in value.

"Issue Date" means November , 2005.

"Lien" means, with respect to any asset, any mortgage, lien, pledge, charge, security interest or encumbrance of any kind in respect ofsuch asset, whether or not filed, recorded or otherwise perfected under applicable law, including any conditional sale or other title retentionagreement, any lease in the nature thereof, any option or other agreement to sell or give a security interest in and any filing of any financingstatement under the Uniform Commercial Code (or equivalent statutes) of any jurisdiction.

"Moody's" means Moody's Investors Service, Inc. or any successor to the rating agency business thereof.

"Net Income" means, with respect to any specified Person for any period, the net income (loss) of such Person, determined in accordancewith GAAP and before any reduction in respect of Preferred Stock dividends, excluding, however:

(1) any gain or loss, together with any related provision for taxes on such gain or loss, realized in connection with: (a) any AssetSale; or (b) the disposition of any securities by such Person or any of its Restricted Subsidiaries or the extinguishment of anyIndebtedness of such Person or any of its Restricted Subsidiaries; and

(2) any extraordinary or nonrecurring gain or loss, together with any related provision for taxes on such extraordinary ornonrecurring gain or loss.

"Net Proceeds" means the aggregate cash proceeds received by the Company or any of its Restricted Subsidiaries in respect of any AssetSale (including any cash received upon the sale or other disposition of any non-cash consideration received in any Asset Sale and any cashpayments received by way of deferred payment of principal pursuant to a note or installment, earn-out or otherwise, but only as and whenreceived), net of (i) the direct costs relating to such Asset Sale, including legal, accounting and investment banking fees, and salescommissions, and any relocation expenses incurred as a result of the Asset Sale, (ii) taxes paid or payable as a result of the Asset Sale, in eachcase, after taking into account any available tax credits or deductions and any tax sharing arrangements, (iii) amounts required to be applied tothe repayment of Indebtedness secured by a Lien on the asset or assets that were the subject of such Asset Sale, (iv) any reserve for adjustmentin respect of the sale price of such asset or assets established in accordance with GAAP, (v) all distributions and other payments required to bemade to minority interest holders in Restricted Subsidiaries or joint ventures as a result of such Asset Sale, and (vi) appropriate amounts to beprovided by the Company or any Restricted Subsidiary as a reserve against any liabilities associated with such Asset Sale, as determined inconformity with GAAP.

"Non-Recourse Debt" means Indebtedness:

(1) as to which neither the Company nor any of its Restricted Subsidiaries (a) provides credit support of any kind (including anyundertaking, agreement or instrument that would constitute Indebtedness), (b) is directly or indirectly liable as a guarantor orotherwise, or (c) constitutes the lender;

13



(2) no default with respect to which (including any rights that the holders of the Indebtedness may have to take enforcement actionagainst an Unrestricted Subsidiary) would permit upon notice, lapse of time or both any holder of any other Indebtedness ofthe Company or any of its Restricted Subsidiaries to declare a default on such other Indebtedness or cause the payment of theIndebtedness to be accelerated or payable prior to its Stated Maturity; and

(3) as to which the lenders have been notified in writing that they will not have any recourse to the stock or assets of the Companyor any of its Restricted Subsidiaries.

"Non-U.S. Person" means a person who is not a U.S. person, as defined in Regulation S.

"Note Guarantee" means the Guarantee by each Guarantor of the Issuers' obligations under this Indenture and the Notes, executedpursuant to the provisions of this Indenture.

"Note Register" means the register of Notes, maintained by the Registrar, pursuant to Section 2.3.

"Obligations" means any principal, interest, penalties, fees, indemnifications, Special Interest, reimbursements, damages and otherliabilities payable under the documentation governing any Indebtedness or in respect thereof.

"Offering Memorandum" means the offering memorandum, dated November , 2005, prepared in connection with the issuance of theInitial Notes on the Issue Date.

"Officer" means the Chairman of the Board, the President, the Chief Financial Officer, any Vice President, the Treasurer or the Secretaryof the Company or Tronox Finance, as applicable, or, to the extent explicitly provided for herein, Parent, as applicable.

"Officers' Certificate" means a certificate signed by two Officers or by an Officer and either an Assistant Treasurer or an AssistantSecretary.

"Opinion of Counsel" means a written opinion from legal counsel who is acceptable to the Trustee. The counsel may be an employee ofor counsel to the Company. The cost of any such Opinion of Counsel shall not be at the expense of the Trustee.

"Permitted Business" means any business engaged in by the Company or any Restricted Subsidiary on the Issue Date and any businessincidental, ancillary, complementary or reasonably related thereto or which is a reasonable extension thereof.

"Permitted Investments" means:

(1) any Investment in the Company or in a Restricted Subsidiary of the Company or by a Restricted Subsidiary of the Company inanother Restricted Subsidiary of the Company;

(2) any Investment in Cash Equivalents;

(3) any Investment by the Company or any Restricted Subsidiary of the Company in a Person, if as a result of such Investment:

(a) such Person becomes a Restricted Subsidiary of the Company and a Guarantor; or

(b) such Person is merged, consolidated or amalgamated with or into, or transfers or conveys substantially all of its assets to,or is liquidated into, the Company or a Restricted Subsidiary of the Company that is a Guarantor;



(4) any Investment made as a result of the receipt of non-cash consideration from an Asset Sale that was made pursuant to and incompliance with Section 3.7;

(5) any Investment solely in exchange for the issuance of Equity Interests (other than Disqualified Stock) of the Company orParent;

14



(6) any Investments received in compromise or resolution of (A) obligations of trade creditors or customers that were incurred inthe ordinary course of business of the Company or any of its Restricted Subsidiaries, including pursuant to any plan ofreorganization or similar arrangement upon the bankruptcy or insolvency of any trade creditor or customer or as a result of aforeclosure by the Company or any Restricted Subsidiary with respect to any secured Investment or other transfer of title withrespect to any secured Investment in default; or (B) litigation, arbitration or other disputes with Persons who are not Affiliates;

(7) Investments represented by Hedging Obligations;

(8) loans or advances to employees or officers made in the ordinary course of business of Parent, the Company or any RestrictedSubsidiary of the Company in an aggregate principal amount not to exceed $1.0 million at any one time outstanding;

(9) receivables owing to the Company or any Restricted Subsidiary created or acquired in the ordinary course of business andpayable or dischargeable in accordance with customary trade terms; provided, however, that such trade terms may includesuch concessionary trade terms as the Company or any such Restricted Subsidiary deems reasonable under the circumstances;

(10) workers' compensation, utility, lease and similar deposits and prepaid expenses in the ordinary course of business andendorsements of negotiable instruments and documents in the ordinary course of business;

(11) refundable construction advances made with respect to the construction of properties of a nature or type that are used in abusiness similar or related to the business of the Company or its Restricted Subsidiaries in the ordinary course of business;

(12) any Investment in a Receivables Subsidiary or any Investment by a Receivables Subsidiary in any other Person in connectionwith a Qualified Receivables Financing, including Investments of funds held in accounts permitted or required by thearrangements governing such Qualified Receivables Financing or any related Indebtedness; provided, however, that anyInvestment in a Receivables Subsidiary is in the form of a Purchase Money Note, contribution of additional receivables or anequity interest;

(13) guarantees (including Guarantees) of Indebtedness permitted under Section 3.3 and performance guarantees consistent withpast practice;

(14) guarantees by the Company or any Restricted Subsidiary of operating leases (other than Capitalized Lease Obligations) or ofother obligations that do not constitute Indebtedness, in each case entered into by any Restricted Subsidiary in the ordinarycourse of business;

(15) Investments of a Restricted Subsidiary acquired after the Issue Date or of an entity merged into the Company or merged into orconsolidated with a Restricted Subsidiary in accordance with Section 4.1 after the Issue Date to the extent that suchInvestments were not made in contemplation of or in connection with such acquisition, merger or consolidation and were inexistence on the date of such acquisition, merger or consolidation; and



(16) other Investments in any Person having an aggregate Fair Market Value (measured on the date each such Investment was madeand without giving effect to subsequent changes in value), when taken together with all other Investments made pursuant tothis clause (16) that are at the time outstanding not to exceed the greater of (a) 1.5% of Consolidated Net Tangible Assets or(b) $20.0 million.

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"Permitted Liens" means:

(1) Liens on assets of the Company or any Guarantor securing Indebtedness and other Obligations under Credit Facilities that arepermitted by clause (1) of the definition of "Permitted Debt" and/or securing Hedging Obligations related thereto;

(2) Liens in favor of the Company or the Guarantors;

(3) Liens on property of a Person existing at the time such Person is merged with or into or consolidated with the Company or anySubsidiary of the Company or becomes a Subsidiary of the Company; provided that such Liens were in existence prior to thecontemplation of such merger or consolidation or prior to the contemplation of such Person becoming a Subsidiary and do notextend to any assets other than those of the Person merged into or consolidated with the Company or the Subsidiary;

(4) Liens on property (including Capital Stock) existing at the time of acquisition of the property by the Company or anySubsidiary of the Company, provided that such Liens were in existence prior to such acquisition, and not incurred incontemplation of such acquisition;

(5) Liens to secure Indebtedness (including Capital Lease Obligations) permitted under Section 3.3(b)(4) covering only the assetsacquired with or financed by such Indebtedness;

(6) Liens existing on the Issue Date;

(7) Liens for taxes, assessments or governmental charges or claims that are not yet delinquent or that are being contested in goodfaith by appropriate proceedings promptly instituted and diligently concluded; provided that any reserve or other appropriateprovision as is required in conformity with GAAP has been made therefor;

(8) survey exceptions, easements or reservations of, or rights of others for, licenses, rights-of-way, sewers, electric lines, telegraphand telephone lines and other similar purposes, or zoning or other restrictions as to the use of real property that were notincurred in connection with Indebtedness and that do not in the aggregate materially adversely affect the value of saidproperties or materially impair their use in the operation of the business of such Person;

(9) Leases or subleases granted to others that do not materially interfere with the ordinary course of business of the Company andits Restricted Subsidiaries, taken as a whole;

(10) Landlords', carriers', warehousemen's, mechanics', materialmen's, repairmen's or the like Liens arising by contract or statute inthe ordinary course of business and with respect to amounts which are not yet delinquent or are being contested in good faithby appropriate proceedings;

(11) Pledges or deposits made in the ordinary course of business (A) in connection with leases, performance bonds and similarobligations, or (B) in connection with workers' compensation, unemployment insurance and other social security legislation;



(12) Liens encumbering property or assets under construction arising from progress or partial payments by a customer of theCompany or its Restricted Subsidiaries relating to such property or assets;

(13) Liens in favor of customs and revenue authorities arising as a matter of law to secure payments of customs duties inconnection with the importation of goods;

(14) Liens arising out of conditional sale, title retention, consignment or similar arrangements for the sale of goods entered into bythe Company or any of its Restricted Subsidiaries in the ordinary course of business in accordance with the past practices ofthe Company and its Restricted Subsidiaries;

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(15) Liens on accounts receivable and related assets of the type specified in the definition of "Receivables Financing" incurred inconnection with a Qualified Receivables Financing;

(16) any attachment or judgment Lien that does not constitute an Event of Default;

(17) Liens (including extensions and renewals thereof) upon real or personal property acquired after the Issue Date; provided that(a) such Lien is created solely for the purpose of securing Indebtedness permitted to be incurred under Section 3.3, (1) tofinance the cost (including the cost of improvement or construction) of the item of property or assets subject thereto and suchLien is created prior to, at the time of or within six months after the later of the acquisition, the completion of construction orthe commencement of full operation of such property or (2) to refinance any Indebtedness previously so secured, (b) theprincipal amount of the Indebtedness secured by such Lien does not exceed 100% of such cost and (c) any such Lien shall notextend to or cover any property or assets other than such item of property, or assets and any accessions, proceeds andimprovements on such item;

(18) Liens incurred or deposits made to secure the performance of tenders, bids, leases, statutory or regulatory obligations, banker'sacceptances, surety and appeal bonds, government contracts, performance and return-of-money bonds and other obligations ofa similar nature incurred in the ordinary course of business (exclusive of obligations for the payment of borrowed money);

(19) Liens arising from filing Uniform Commercial Code financing statements with respect to leases;

(20) Liens created for the benefit of (or to secure) the Notes (or the Note Guarantees);

(21) Liens to secure any Permitted Refinancing Indebtedness permitted to be incurred under this Indenture; provided, however,that:

(a) the new Lien shall be limited to all or part of the same property and assets that secured or, under the written agreementspursuant to which the original Lien arose, could secure the original Lien (plus improvements and accessions to, suchproperty or proceeds or distributions thereof); and

(b) the Indebtedness secured by the new Lien is not increased to any amount greater than the sum of (x) the outstandingprincipal amount, or, if greater, committed amount, of the Permitted Refinancing Indebtedness and (y) an amountnecessary to pay any fees and expenses, including premiums, related to such renewal, refunding, refinancing,replacement, defeasance or discharge;

(22) Liens granted by Foreign Subsidiaries to secure Indebtedness permitted to be incurred under Section 3.3(b)(12);

(23) Liens securing Indebtedness or other obligations of a Restricted Subsidiary owing to the Company;

(24) Liens that are contractual rights of set-off (A) relating to the establishment of depository relations with banks not given inconnection with the issuance of Indebtedness, (B) relating to pooled deposit or sweep accounts of the Company or any



Restricted Subsidiary to permit satisfaction (within two business days) of overdraft or similar obligations incurred in theordinary course of business of the Company and the Restricted Subsidiaries or (C) relating to purchase orders and otheragreements entered into with customers of the Company or any Restricted Subsidiary in the ordinary course of business;

(25) Liens securing Hedging Obligations so long as the related Indebtedness is permitted to be incurred under this Indenture and issecured by a Lien on the same property securing such Hedging Obligation;

17



(26) licenses of intellectual property granted in a manner consistent with past practice;

(27) Liens securing industrial revenue bonds;

(28) Liens solely on any cash earnest money deposits made by the Company or any of the Restricted Subsidiaries in connectionwith any letter of intent or purchase agreement permitted under this Indenture; and

(29) Liens incurred in the ordinary course of business of the Company or any Subsidiary of the Company with respect toobligations that do not exceed $25.0 million at any one time outstanding.

"Permitted Payments to Parent" means, without duplication as to amounts:

(1) payments to Parent or any other holding company that directly or indirectly owns 100% of the Equity Interests of theCompany, in amounts sufficient to pay:

(a) franchise taxes and other tax obligations or fees required in each case to maintain its corporate existence,

(b) costs associated with preparation of required documents for filing with the Commission and with any exchange on whichsuch company's securities are traded,

(c) legal, accounting, and other professional fees and expenses, and

(d) other overhead, operating or administrative costs incurred in the ordinary course of business up to $2.0 million perannum; and

(2) payments of up to $1.0 million per annum to Parent in amounts sufficient to pay fees and expenses related to any securitiesoffering, investment, acquisition or other similar financing transaction permitted under this Indenture (whether or notsuccessful).

"Permitted Refinancing Indebtedness" means any Indebtedness of the Company or any of its Restricted Subsidiaries issued in exchangefor, or the net proceeds of which are used to renew, refund, refinance, replace, defease or discharge other Indebtedness of the Company or anyof its Restricted Subsidiaries (other than intercompany Indebtedness); provided that:

(1) the principal amount (or accreted value, if applicable) of such Permitted Refinancing Indebtedness does not exceed theprincipal amount (or accreted value, if applicable) of the Indebtedness renewed, refunded, refinanced, replaced, defeased ordischarged (plus all accrued interest on the Indebtedness and the amount of all fees and expenses, including premiums,incurred in connection therewith);

(2) such Permitted Refinancing Indebtedness has a final maturity date later than the final maturity date of, and has a WeightedAverage Life to Maturity equal to or greater than the Weighted Average Life to Maturity of, the Indebtedness being renewed,refunded, refinanced, replaced, defeased or discharged;



(3) if the Indebtedness being renewed, refunded, refinanced, replaced, defeased or discharged is subordinated in right of paymentto the Notes, such Permitted Refinancing Indebtedness has a final maturity date later than the final maturity date of, and issubordinated in right of payment to, the Notes on terms at least as favorable to the Holders of Notes as those contained in thedocumentation governing the Indebtedness being renewed, refunded, refinanced, replaced, defeased or discharged; and

(4) such Indebtedness is incurred either by the Company or by the Restricted Subsidiary who is the obligor on the Indebtednessbeing renewed, refunded, refinanced, replaced, defeased or discharged.

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"Person" means any individual, corporation, partnership, joint venture, association, joint-stock company, trust, unincorporatedorganization, limited liability company or government or other entity.

"Preferred Stock", as applied to the Capital Stock of any corporation, means Capital Stock of any class or classes (however designated)which is preferred as to the payment of dividends, or as to the distribution of assets upon any voluntary or involuntary liquidation ordissolution of such corporation, over shares of Capital Stock of any other class of such corporation.

"Pro Forma Cost Savings" means, with respect to any period, the reduction in costs and related adjustments that occurred during the four-quarter reference period or after the end of the four-quarter reference period and on or prior to the Calculation Date that were (i) directlyattributable to an acquisition or Asset Sale and calculated on a basis that is consistent with Regulation S-X under the Securities Act as in effectand applied as of the Issue Date or (ii) implemented, or for which the steps necessary for implementation have been taken by the Companyand are reasonably expected to occur, with respect to the Company or the business that was the subject of any such acquisition or Asset Salewithin six months before or after the date of the acquisition or Asset Sale and that are supportable and quantifiable by the underlyingaccounting records of such business, as if, in the case of each of clause (i) and (ii), all such reductions in costs and related adjustments hadbeen effected as of the beginning of such period.

"Purchase Money Note" means a promissory note of a Receivables Subsidiary evidencing a line of credit, which may be irrevocable,from the Company or any of its Subsidiaries to a Receivables Subsidiary in connection with a Qualified Receivables Financing, which note isintended to finance that portion of the purchase price that is not paid by cash or a contribution of equity.

"Qualified Receivables Financing" means any Receivables Financing of a Receivables Subsidiary that meets the following conditions:

(1) the Board of Directors of Parent shall have determined in good faith that such Qualified Receivables Financing (includingfinancing terms, covenants, termination events and other provisions) is in the aggregate economically fair and reasonable tothe Company and the Receivables Subsidiary;

(2) all sales of accounts receivable and related assets to the Receivables Subsidiary are made at Fair Market Value (as determinedin good faith by the Company); and

(3) the financing terms, covenants, termination events and other provisions thereof shall be market terms (as determined in goodfaith by the Company) and may include Standard Securitization Undertakings.

The grant of a security interest in any accounts receivable of the Company or any of its Restricted Subsidiaries (other than a ReceivablesSubsidiary) to secure Indebtedness under Credit Facilities shall not be deemed a Qualified Receivables Financing.

"Receivables Financing" means any transaction or series of transactions that may be entered into by the Company or any of itsSubsidiaries pursuant to which the Company or any of its Subsidiaries may sell, convey or otherwise transfer to (a) a Receivables Subsidiary(in the case of transfer by the Company or any of its Subsidiaries) and (b) any other Person (in the case of a transfer by a ReceivablesSubsidiary), or may grant a security interest in, any accounts receivable (whether now existing or arising in the future) of the Company or anyof its Subsidiaries, and any assets related thereto including all collateral securing such accounts receivable, all contracts and all guarantees orother assets which are customarily transferred or in respect of which security interests are customarily granted in connection with assetsecuritization transactions involving accounts receivable and any Hedging Obligations entered into by the Company or any such Subsidiary inconnection with such accounts receivable.

"Receivables Repurchase Obligation" means any obligation of a seller of receivables in a Qualified Receivables Financing to repurchasereceivables arising as a result of a breach of representation, warranty

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or covenant or otherwise, including as a result of a receivable or portion thereof becoming subject to any asserted defense, dispute, off-set orcounterclaim of any kind as a result of any action taken by, any failure to take action by or any other event relating to the seller.

"Receivables Subsidiary" means any Restricted Subsidiary of the Company, 100% of the outstanding Capital Stock of which is owneddirectly or indirectly by the Company, or another Person formed for the purposes of engaging in a Qualified Receivables Financing with theCompany in which the Company or any Subsidiary of the Company makes an Investment and to which the Company or such Subsidiarytransfers accounts receivable and related assets, which engages in no activities other than in connection with the financing of accountsreceivable of the Company and its Subsidiaries, all proceeds thereof and all rights (contractual or other), collateral and other assets relatingthereto, and any business or activities incidental or related to such business, and which is designated by the Board of Directors of Parent (asprovided below) as a Receivables Subsidiary and:

(1) no portion of the Indebtedness or any other obligations (contingent or otherwise) of which (a) is guaranteed by the Company orany other Subsidiary of the Company (excluding guarantees of obligations (other than the principal of, and interest on,Indebtedness) pursuant to Standard Securitization Undertakings), (b) is recourse to or obligates the Company or any otherSubsidiary of the Company in any way other than pursuant to Standard Securitization Undertakings, or (c) subjects anyproperty or asset of the Company or any other Subsidiary of the Company, directly or indirectly, contingently or otherwise, tothe satisfaction thereof, other than pursuant to Standard Securitization Undertakings;

(2) with which neither the Company nor any other Subsidiary of the Company has any material contract, arrangement, agreementor understanding other than on terms which the Company reasonably believes to be no less favorable to the Company or suchSubsidiary than those that might be obtained at the time from Persons that are not Affiliates of the Company; and

(3) to which neither the Company nor any other Subsidiary of the Company has any obligation to maintain or preserve suchentity's financial condition or cause such entity to achieve certain levels of operating results.

Any such designation by the Board of Directors of Parent shall be evidenced to the Trustee by filing with the Trustee a certified copy ofthe resolution of such Board of Directors giving effect to such designation and an Officers' Certificate certifying that such designationcomplied with the foregoing conditions.

"Redemption Date" when used with respect to any Note to be redeemed, in whole or in part, means the date fixed for such redemption byor pursuant to this Indenture.

"Registered Exchange Offer" has the meaning set forth for such term in the Registration Rights Agreement.

"Registration Rights Agreement" means that certain registration rights agreement dated as of the Issue Date by and between theCompany, the Guarantors and the initial purchasers set forth therein and future registration rights agreements with respect to Additional Notes.

"Restricted Investment" means an Investment other than a Permitted Investment.

"Restricted Notes" means Notes bearing the Private Placement Legend.

"Restricted Subsidiary" of a Person means any Subsidiary of the referent Person that is not an Unrestricted Subsidiary.

"sale and leaseback transaction" means an arrangement relating to property now owned or hereafter acquired whereby the Company or aRestricted Subsidiary transfers such property to a Person and the Company or a Restricted Subsidiary leases it from such Person.

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"Securities Act" means the Securities Act of 1933, as amended.

"Significant Subsidiary" means any Subsidiary that would be a "significant subsidiary" as defined in Article 1, Rule 1-02 ofRegulation S-X, promulgated pursuant to the Securities Act, as such Regulation is in effect on the date of this Indenture.

"Special Interest" means all liquidated damages then owing pursuant to the Registration Rights Agreement. The Trustee shall be under noobligation to determine or calculate the Special Interest, whether the Special Interest is due and payable, or to give notice with respect thereto.The Trustee may conclusively assume, in the absence of written notice to the contrary from the Company or a Holder or Holders of Notes, thatno Special Interest is due and payable.

"Standard Securitization Undertakings" means representations, warranties, covenants, indemnities and guarantees of performance enteredinto by the Company or any of its Subsidiaries, which the Company has determined in good faith to be customary in a Receivables Financingincluding those relating to the servicing of the assets of a Receivables Subsidiary, it being understood that any Receivables RepurchaseObligation shall be deemed to be a Standard Securitization Undertaking.

"Standard & Poor's" means Standard & Poor's Ratings Group, Inc., or any successor to the rating agency business thereof.

"Stated Maturity" means, with respect to any installment of interest or principal on any series of Indebtedness, the date on which thepayment of interest or principal was scheduled to be paid in the documentation governing such Indebtedness as of the Issue Date, and will notinclude any contingent obligations to repay, redeem or repurchase any such interest or principal prior to the date originally scheduled for thepayment thereof.

"Subsidiary" means, with respect to any specified Person, any corporation, association or other business entity of which more than 50%of the total voting power of shares of Capital Stock entitled (without regard to the occurrence of any contingency and after giving effect to anyvoting agreement or stockholders' agreement that effectively transfers voting power) to vote in the election of directors, managers or trusteesof the corporation, association or other business entity is at the time owned or controlled, directly or indirectly, by that Person or one or moreof the other Subsidiaries of that Person (or a combination thereof).

"TIA" or "Trust Indenture Act" means the Trust Indenture Act of 1939 (15 U.S.C. §§ 77aaa, 77bbbb), as in effect on the Issue Date.

"Transition Agreements" means the following agreements described in the Offering Memorandum:

(1) the Master Separation Agreement;

(2) the Transition Services Agreement;

(3) the Transitional License Agreement;

(4) the Registration Rights Agreement;

(5) the Tax Sharing Agreement;

(6) the Employee Benefits Agreement;



(7) the Assignment, Assumption and Indemnity Agreement; and

(8) the Toll Manufacturing Agreement.

"Trustee" means the party named as such in this Indenture until a successor replaces it and, thereafter, means the successor.

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"Trust Officer" shall mean, when used with respect to the Trustee, any officer within the corporate trust department of the Trustee,including any vice president, assistant vice president, trust officer or any other officer of the Trustee who customarily performs functionssimilar to those performed by the Persons who at the time shall be such officers, respectively, or to whom any corporate trust matter is referredbecause of such person's knowledge of and familiarity with the particular subject and who, in each case, shall have direct responsibility for theadministration of this Indenture.

"Unrestricted Subsidiary" means any Subsidiary of the Company that is designated by the Board of Directors of the Company as anUnrestricted Subsidiary pursuant to a resolution of the Board of Directors, but only to the extent that such Subsidiary:

(1) has no Indebtedness other than Non-Recourse Debt;

(2) except as permitted by Section 3.8, is not party to any agreement, contract, arrangement or understanding with the Company orany Restricted Subsidiary of the Company unless the terms of any such agreement, contract, arrangement or understanding areno less favorable to the Company or such Restricted Subsidiary than those that might be obtained at the time from Personswho are not Affiliates of the Company;

(3) is a Person with respect to which neither the Company nor any of its Restricted Subsidiaries has any direct or indirectobligation (a) to subscribe for additional Equity Interests or (b) to maintain or preserve such Person's financial condition or tocause such Person to achieve any specified levels of operating results; and

(4) has not guaranteed or otherwise directly or indirectly provided credit support for any Indebtedness of the Company or any ofits Restricted Subsidiaries

Any such designation by the Board of Directors of the Company shall be evidenced for purposes of this Indenture by filing with theTrustee a Board Resolution giving effect to such designation and an Officers' Certificate certifying that such designation complies with theforegoing conditions. If, at any time, any Unrestricted Subsidiary would fail to meet the foregoing requirements as an Unrestricted Subsidiary,it shall thereafter cease to be an Unrestricted Subsidiary for purposes of this Indenture and any Indebtedness of such Subsidiary shall bedeemed to be incurred as of such date.

"Voting Stock" of any specified Person as of any date means the Capital Stock of such Person that is at the time entitled to vote in theelection of the Board of Directors of such Person.

"Weighted Average Life to Maturity" means, when applied to any Indebtedness at any date, the number of years obtained by dividing:

(1) the sum of the products obtained by multiplying (a) the amount of each then remaining installment, sinking fund, serialmaturity or other required payments of principal, including payment at final maturity, in respect of the Indebtedness, by (b) thenumber of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment; by

(2) the then outstanding principal amount of such Indebtedness.

Section 1.2. Other Definitions.

TermDefined in

Section

"Additional Notes" Preamble



"Additional Restricted Notes" 2.1(b)

"Affiliate Transaction" 3.8(a)

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"Agent Member" 2.1(e)(iii)

"Asset Sale Offer" 3.7(d)

"Asset Sale Offer Amount" 3.7(e)

"Asset Sale Offer Period" 3.7(e)

"Asset Sale Payment Date" 3.7(e)

"Authenticating Agent" 2.2

"Calculation Date"1.1 (definition of "FixedCharge Coverage Ratio")

"Certificate of Destruction" 2.10

"Change of Control Offer" 3.9

"Change of Control Payment" 3.9

"Change of Control Purchase Date" 3.9

"Change of Control Settlement Date" 3.9

"Company" Preamble

"Company Order" 2.2

"Corporate Trust Office" 3.14

"Covenant Defeasance" 8.3

"Defaulted Interest" 2.11

"Event of Default" 6.1

"Excess Proceeds" 3.7(c)

"Exchange Global Note" 2.1(b)

"Exchange Notes" Preamble

"Funding Guarantor" 10.4

"General Partner"1.1 (definition of"Indebtedness")

"Global Note Legend" 2.1(d)(B)



"Global Notes" 2.1(b)

"incur" 3.3(a)

"Initial Notes" Preamble

"Issuers" Preamble

"Joint Venture"1.1 (definition of"Indebtedness")

"Legal Defeasance" 8.2

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"Legal Holiday" 12.8

"Notes" Preamble

"Parent" Preamble

"Payment Default" 6.1(6)(a)

"Paying Agent" 2.3

"Permitted Debt" 3.3(b)

"Private Placement Legend" 2.1(d)

"protected purchaser" 2.8

"QIB" 2.1(b)

"Registrar" 2.3

"Regulation S" 2.1(b)

"Regulation S Global Note" 2.1(b)

"Regulation S Note" 2.1(b)

"Resale Restriction Termination Date" 2.6(a)

"Restricted Payment" 3.4(a)

"Restricted Period" 2.1(a)

"Rule 144A" 2.1(b)

"Rule 144A Global Note" 2.1(b)

"Rule 144A Note" 2.1(b)

"Securities Custodian" 2.1(b)

"Special Interest Payment Date" 2.11(a)

"Special Record Date" 2.11(a)

"Successor Company" 4.1

"Tronox Finance" Preamble

"Trustee" Preamble



Section 1.3. Incorporation by Reference of Trust Indenture Act. This Indenture is subject to the mandatory provisions of the TIAwhich are incorporated by reference in and made a part of this Indenture. The following TIA terms have the following meanings:

"Commission" means the SEC.

"indenture securities" means the Notes.

"indenture security holder" means a Holder of a Note.

"indenture to be qualified" means this Indenture.

"indenture trustee" or "institutional trustee" means the Trustee.

"obligor" on the Notes means the Issuers, the Guarantors and any other obligor on the Notes.

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All other TIA terms used in this Indenture that are defined by the TIA, defined in the TIA by reference to another statute or defined byCommission's rule have the meanings assigned to them by such definitions.

Section 1.4. Rules of Construction. Unless the context otherwise requires:

(1) a term has the meaning assigned to it;

(2) an accounting term not otherwise defined has the meaning assigned to it in accordance with GAAP;

(3) "or" is not exclusive;

(4) "including" means including without limitation;

(5) words in the singular include the plural and words in the plural include the singular;

(6) the principal amount of any noninterest bearing or other discount security at any date shall be the principal amount thereofthat would be shown on a balance sheet of the Company dated such date prepared in accordance with GAAP; and

(7) the principal amount of any Preferred Stock shall be (i) the maximum liquidation value of such Preferred Stock or (ii) themaximum mandatory redemption or mandatory repurchase price with respect to such Preferred Stock, in each case, at the date ofdetermination, whichever is greater.

ARTICLE II

The Notes

Section 2.1. Form, Dating and Terms.

(a) The aggregate principal amount of Notes that may be authenticated and delivered under this Indenture is unlimited. The Initial Notesissued on the Issue Date will be in an aggregate principal amount of $350,000,000. In addition, the Company may issue, from time to time inaccordance with the provisions of this Indenture, including Section 3.3, Additional Notes and Exchange Notes. Furthermore, Notes may beauthenticated and delivered upon registration or transfer, or in lieu of, other Notes pursuant to Section 2.6, 2.8, 2.9, 5.8 or 9.5 or in connectionwith an Asset Sale Offer pursuant to Section 3.7 or a Change of Control Offer pursuant to Section 3.9.

With respect to any Additional Notes, the Issuers shall set forth in a Board Resolution and an Officer's Certificate, the followinginformation:

(1) the aggregate principal amount of such Additional Notes to be authenticated and delivered pursuant to this Indenture;

(2) the issue price and the issue date of such Additional Notes, including the date from which interest shall accrue; and

(3) whether such Additional Notes shall be Restricted Notes issued in the form of Exhibit A hereto and/or shall be issued inthe form of Exhibit B hereto.

The Initial Notes, the Additional Notes and the Exchange Notes shall be considered collectively as a single class for all purposes of thisIndenture. Holders of the Initial Notes, the Additional Notes and the Exchange Notes will vote and consent together on all matters to whichsuch Holders are entitled to vote or consent as one class, and none of the Holders of the Initial Notes, the Additional Notes or the ExchangeNotes shall have the right to vote or consent as a separate class on any matter to which such Holders are entitled to vote or consent.



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(b) The Initial Notes are being offered and sold by the Issuers pursuant to a Purchase Agreement, dated November , 2005, among theIssuers, the Guarantors, Lehman Brothers Inc., Credit Suisse First Boston LLC and the other initial purchasers named therein. The InitialNotes and any Additional Notes that are not issued in an offer registered under the Securities Act ("Additional Restricted Notes") will beresold initially only to (A) qualified institutional buyers (as defined in Rule 144A under the Securities Act ("Rule 144A")) in reliance onRule 144A ("QIBs") and (B) Persons other than U.S. Persons (as defined in Regulation S under the Securities Act ("Regulation S")) inreliance on Regulation S. Such Initial Notes and Additional Restricted Notes thereafter may be transferred to, among others, QIBs andpurchasers in reliance on Regulation S in accordance with the procedures described herein.

Initial Notes and Additional Restricted Notes offered and sold to QIBs in the United States of America in reliance on Rule 144A (the"Rule 144A Notes") shall be issued in the form of a permanent global Note, without interest coupons, substantially in the form of Exhibit A,which is hereby incorporated by reference and made a part of this Indenture, including appropriate legends as set forth in Section 2.1(d) (the"Rule 144A Global Note"), deposited with the Trustee, as custodian for DTC or its nominee (the "Securities Custodian"), duly executed by theIssuers and authenticated by the Trustee as hereinafter provided. The Rule 144A Global Note may be represented by more than one certificate,if so required by DTC's rules regarding the maximum principal amount to be represented by a single certificate. The aggregate principalamount of the Rule 144A Global Note may from time to time be increased or decreased by adjustments made on the records of the Trustee, asSecurities Custodian, as hereinafter provided.

Initial Notes and Additional Restricted Notes offered and sold outside the United States of America (the "Regulation S Notes") inreliance on Regulation S shall be issued in the form of a permanent global Note, without interest coupons, substantially in the form ofExhibit A, including appropriate legends as set forth in Section 2.1(d) (the "Regulation S Global Note") deposited with the Trustee asSecurities Custodian or as custodian for the nominee of DTC for the accounts of the designated agents of Euroclear or Clearstream, dulyexecuted by the Issuers and authenticated by the Trustee as hereinafter provided. Through and including the 40th day after the Issue Date(such period through and including such 40th day, the "Restricted Period"), beneficial interests in the Regulation S Global Notes may be heldonly through Euroclear and Clearstream (as indirect participants in DTC), unless transferred to a person that takes delivery through aRule 144A Global Note in accordance with the certification requirements described below. Beneficial interests in the Rule 144A Global Notesmay not be exchanged for beneficial interests in the Regulation S Global Notes at any time except in the limited circumstances describedbelow. The Regulation S Global Note may be represented by more than one certificate, if so required by DTC's rules regarding the maximumprincipal amount to be represented by a single certificate. The aggregate principal amount of the Regulation S Global Note may from time totime be increased or decreased by adjustments made on the records of the Trustee, as custodian for DTC or its nominee, as hereinafterprovided.

Exchange Notes exchanged for interests in the Rule 144A Notes and the Regulation S Notes will be issued in the form of a permanentglobal Note, without interest coupons, substantially in the form of Exhibit B, which is hereby incorporated by reference and made a part ofthis Indenture, deposited with the Trustee as hereinafter provided, including the appropriate legend set forth in Section 2.1(d) (the "ExchangeGlobal Note"). The Exchange Global Note may be represented by more than one certificate, if so required by DTC's rules regarding themaximum principal amount to be represented by a single certificate.

The Rule 144A Global Note, the Regulation S Global Note and the Exchange Global Note are sometimes collectively herein referred toas the "Global Notes."

Payments of all principal, interest and premium and Special Interest, if any, on the Notes will be made to each registered Holder by wiretransfer in immediately available funds if that Holder has given to the Issuers, through the Paying Agent or otherwise, wire instructions at leastfive business days prior to the applicable payment date or by check mailed to the address of the Holder as it appears on the books of theregistrar if the Holder has not provided wire instructions; provided that the final distribution in respect of any Note will be made only uponpresentation and surrender of such Note at the applicable Corporate Trust Office of the Trustee.

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The Notes may have notations, legends or endorsements required by law, stock exchange rule or usage, in addition to those set forth onExhibit A and Exhibit B and in Section 2.1(d). The Issuers shall approve the forms of the Notes and any notation, endorsement or legend onthem. Each Note shall be dated the date of its authentication. The terms of the Notes set forth in Exhibit A and Exhibit B are part of the termsof this Indenture and, to the extent applicable, the Issuers, the Guarantors and the Trustee, by their execution and delivery of this Indenture,expressly agree to be bound by such terms.

(c) Denominations. The Notes shall be issuable only in fully registered form, without coupons, and only in denominations of $1,000 andany integral multiple thereof.

(d) Legends. Unless and until (i) an Initial Note or an Additional Restricted Note is sold under an effective registration statement or(ii) an Initial Note or an Additional Restricted Note is exchanged for an Exchange Note in connection with an effective registration statement,in each case pursuant to the Registration Rights Agreement or a similar agreement,

(A) the Initial Note or Additional Restricted Note, as the case may be, shall bear the following legend (the "Private Placement Legend")on the face thereof:

THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED(THE "SECURITIES ACT"), OR OTHER SECURITIES LAWS. NEITHER THIS NOTE NOR ANY INTEREST OR PARTICIPATIONHEREIN MAY BE RE-OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OFIN THE ABSENCE OF SUCH REGISTRATION OR UNLESS THE TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THEREGISTRATION REQUIREMENTS OF THE SECURITIES ACT. EACH PURCHASER OF THE NOTE EVIDENCED HEREBY ISHEREBY NOTIFIED THAT THE SELLER MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OFTHE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. THE HOLDER OF THIS NOTE BY ITS ACCEPTANCEHEREOF (1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THESECURITIES ACT) OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING ITS NOTE IN AN "OFFSHORE TRANSACTION"PURSUANT TO RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, (2) AGREES THAT IT WILL NOT PRIOR TO(X) THE DATE WHICH IS TWO YEARS (OR SUCH SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144(K) UNDER THESECURITIES ACT OR ANY SUCCESSOR PROVISION THEREUNDER) AFTER THE LATER OF THE ORIGINAL ISSUE DATEHEREOF (OR OF ANY PREDECESSOR OF THIS NOTE) OR THE LAST DAY ON WHICH ANY ISSUER OR ANY AFFILIATE OFTHE ISSUERS WAS THE OWNER OF THIS NOTE (OR ANY PREDECESSOR OF THIS NOTE) AND (Y) SUCH LATER DATE, IFANY, AS MAY BE REQUIRED BY APPLICABLE LAW (THE "RESALE RESTRICTION TERMINATION DATE"), OFFER, SELL OROTHERWISE TRANSFER THIS NOTE EXCEPT (A) TO ANY ISSUER, (B) PURSUANT TO A REGISTRATION STATEMENT WHICHHAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE NOTES ARE ELIGIBLE FORRESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER"AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THEACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADEIN RELIANCE ON RULE 144A INSIDE THE UNITED STATES, (D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONSTHAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT OR(E) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIESACT AND (3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICESUBSTANTIALLY TO THE EFFECT OF THIS LEGEND; PROVIDED THAT THE ISSUERS, THE TRUSTEE AND THE

27



REGISTRAR SHALL HAVE THE RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (I) PURSUANT TO CLAUSE (D) OR(E) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATIONSATISFACTORY TO EACH OF THEM AND (II) IN EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATIONOF TRANSFER IN THE FORM APPEARING ON THE OTHER SIDE OF THE NOTE IS COMPLETED AND DELIVERED BY THISTRANSFEROR TO THE TRUSTEE. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THERESALE RESTRICTION TERMINATION DATE. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITEDSTATES" AND "U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT"

(B) The Global Notes, whether or not an Initial Note, Additional Restricted Note or Exchange Note, shall bear the following legend (the"Global Note Legend") on the face thereof:

"UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUSTCOMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW YORK, TO THE COMPANY OR ITS AGENT FORREGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED INTHE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVEOF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY ANAUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OROTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE &CO., HAS AN INTEREST HEREIN.

TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TONOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OFPORTIONS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THERESTRICTIONS SET FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF."

(e) Book-Entry Provisions

(1) This Section 2.1(e) shall apply only to Global Notes deposited with the Trustee, as custodian for DTC.

(2) Each Global Note initially shall (x) be registered in the name of DTC for such Global Note or the nominee of DTC, (y) bedelivered to the Trustee as custodian for DTC and (z) bear legends as set forth in Section 2.1(d).

(3) Members of, or participants in, DTC ("Agent Members") shall have no rights under this Indenture with respect to anyGlobal Note held on their behalf by DTC or by the Trustee as the custodian of DTC or under such Global Note, and DTC may betreated by the Issuers, the Trustee and any agent of the Issuers or the Trustee as the absolute owner of such Global Note for allpurposes whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the Issuers, the Trustee or any agent of the Issuersor the Trustee from giving effect to any written certification, proxy or other authorization furnished by DTC or impair, as betweenDTC and its Agent Members, the operation of customary practices of DTC governing the exercise of the rights of a Holder of abeneficial interest in any Global Note.

(4) In connection with any transfer of a portion of the beneficial interest in a Global Note pursuant to subsection (f) of thisSection 2.1 to beneficial owners who are required to hold Definitive Notes, the Securities Custodian shall reflect on its books andrecords the date and a decrease in the

28



principal amount of such Global Note in an amount equal to the principal amount of the beneficial interest in the Global Note to betransferred, and the Issuers shall execute, and the Trustee shall authenticate and deliver, one or more Definitive Notes of like tenorand amount.

(5) In connection with the transfer of an entire Global Note to beneficial owners pursuant to subsection (f) of this Section 2.1,such Global Note shall be deemed to be surrendered to the Trustee for cancellation, and the Issuers shall execute, and the Trusteeshall authenticate and deliver, to each beneficial owner identified by DTC in exchange for its beneficial interest in such Global Note,an equal aggregate principal amount of Definitive Notes of authorized denominations.

(6) The registered Holder of a Global Note may grant proxies and otherwise authorize any person, including Agent Membersand persons that may hold interests through Agent Members, to take any action which a Holder is entitled to take under thisIndenture or the Notes.

(f) Euroclear and Clearstream Procedures Applicable. The provisions of the "Operating Procedures of the Euroclear System" and"Terms and Conditions Governing Use of Euroclear" and the "General Terms and Conditions of Clearstream Banking" and "CustomerHandbook" of Clearstream will be applicable to transfers of beneficial interests in the Regulation S Global Note that are held by AgentMembers through Euroclear or Clearstream.

(g) Definitive Notes. Except as provided below, owners of beneficial interests in Global Notes will not be entitled to receive DefinitiveNotes. If required to do so pursuant to any applicable law or regulation, beneficial owners may obtain Definitive Notes in exchange for theirbeneficial interests in a Global Note upon written request in accordance with DTC's and the Registrar's procedures. In addition, DefinitiveNotes shall be transferred to all beneficial owners in exchange for their beneficial interests in a Global Note if (a) DTC notifies the Issuers thatit is unwilling or unable to continue as depositary for such Global Note or DTC ceases to be a clearing agency registered under the ExchangeAct, at a time when DTC is required to be so registered in order to act as depositary, and in each case a successor depositary is not appointedby the Issuers within 90 days of such notice, (b) the Issuers, at their option, notify the Trustee in writing that they elect to cause the issuance ofthe Definitive Notes or (c) an Event of Default has occurred and is continuing.

(1) Any Definitive Note delivered in exchange for an interest in a Global Note pursuant to Section 2.1(e)(4) or (5) will beregistered in the names and issued in any approved denominations, requested by or on behalf of DTC (in accordance with itscustomary procedures) and, except as otherwise provided by Section 2.6(c), bear the Private Placement Legend set forth inSection 2.1(d).

(2) In connection with the exchange of a portion of a Definitive Note for a beneficial interest in a Global Note, the Trusteeshall cancel such Definitive Note, and the Issuers shall execute, and the Trustee shall authenticate and deliver, to the transferringHolder a new Definitive Note representing the principal amount not so transferred.

Section 2.2. Execution and Authentication. One Officer of each Issuer shall sign the Notes for such Issuer by manual or facsimilesignature. If an Officer whose signature is on a Note no longer holds that office at the time the Trustee authenticates the Note, the Note shallbe valid nevertheless, after giving effect to any exchange of Initial Notes for Exchange Notes.

A Note shall not be valid until an authorized signatory of the Trustee manually authenticates the Note. The signature of the Trustee on aNote shall be conclusive evidence that such Note has been duly and validly authenticated and issued under this Indenture. A Note shall bedated the date of its authentication.

At any time and from time to time after the execution and delivery of this Indenture, the Trustee shall authenticate and make available fordelivery: (1) Initial Notes for original issue on the Issue Date in an aggregate principal amount of $350,000,000, (2) Additional Notes fororiginal issue and (3) Exchange Notes for issue only in an exchange offer pursuant to the Registration Rights Agreement, and only in

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exchange for Initial Notes or Additional Notes of an equal principal amount, in each case upon a written order of the Issuers signed by twoOfficers of each Issuer or by an Officer and either an Assistant Treasurer or an Assistant Secretary of each Issuer (the "Company Order").Such Company Order shall specify the amount of the Notes to be authenticated and the date on which the original issue of Notes is to beauthenticated and whether the Notes are to be Initial Notes, Additional Notes or Exchange Notes.

The Trustee may appoint an agent (the "Authenticating Agent") reasonably acceptable to the Issuers to authenticate the Notes. Unlesslimited by the terms of such appointment, any such Authenticating Agent may authenticate Notes whenever the Trustee may do so. Eachreference in this Indenture to authentication by the Trustee includes authentication by the Authenticating Agent.

In case any Issuer or any Guarantor, pursuant to Article IV or Section 10.2, shall be consolidated or merged with or into any other Personor shall convey, transfer, lease or otherwise dispose of all or substantially all of its properties and assets to any Person, and the successorPerson resulting from such consolidation, or surviving such merger, or into which any Issuer or any Guarantor shall have been merged, or thePerson which shall have received a conveyance, transfer, lease or other disposition as aforesaid, shall have executed an indenturesupplemental hereto with the Trustee pursuant to Article IV, any of the Notes authenticated or delivered prior to such consolidation, merger,conveyance, transfer, lease or other disposition may, from time to time, at the request of the successor Person, be exchanged for other Notesexecuted in the name of the successor Person with such changes in phraseology and form as may be appropriate, but otherwise in substance oflike tenor as the Notes surrendered for such exchange and of like principal amount; and the Trustee, upon Company Order of the successorPerson, shall authenticate and deliver Notes as specified in such order for the purpose of such exchange. If Notes shall at any time beauthenticated and delivered in any new name of a successor Person pursuant to this Section 2.2 in exchange or substitution for or uponregistration of transfer of any Notes, such successor Person, at the option of the Holders but without expense to them, shall provide for theexchange of all Notes at the time outstanding for Notes authenticated and delivered in such new name.

Section 2.3. Registrar and Paying Agent. The Issuers shall maintain an office or agency where Notes may be presented for registration oftransfer or for exchange (the "Registrar") and an office or agency where Notes may be presented for payment (the "Paying Agent"). TheIssuers shall cause each of the Registrar and the Paying Agent to maintain an office or agency in the Borough of Manhattan, The City of NewYork. The Registrar shall keep a register of the Notes and of their transfer and exchange (the "Note Register"). The Issuers may have one ormore co-registrars and one or more additional paying agents. The term "Paying Agent" includes any additional paying agent.

The Issuers shall enter into an appropriate agency agreement with any Registrar, Paying Agent or co-registrar not a party to thisIndenture, which shall incorporate the terms of the TIA. The agreement shall implement the provisions of this Indenture that relate to suchagent. The Issuers shall notify the Trustee of the name and address of each such agent. If the Issuers fail to maintain a Registrar or PayingAgent, the Trustee shall act as such and shall be entitled to appropriate compensation therefor pursuant to Section 7.7. The Company or any ofits Restricted Subsidiaries may act as Paying Agent, Registrar, co-registrar or transfer agent.

The Issuers initially appoint the Trustee as Registrar and Paying Agent for the Notes.

Section 2.4. Paying Agent to Hold Money in Trust. By no later than 11:00 a.m. (New York City time) on the date on which anyprincipal of, premium, if any, on or interest and Special Interest, if any, on, any Note is due and payable, the Issuers shall deposit with thePaying Agent a sum sufficient in immediately available funds to pay such principal, premium, interest and Special Interest, if any, when due.The Issuers shall require each Paying Agent (other than the Trustee) to agree in writing that such Paying Agent shall hold in trust for thebenefit of the Holders or the Trustee all money held by such Paying Agent for the payment of principal of, or premium, if any, on, and interestand Special Interest, if any, on, the Notes and shall notify the Trustee in writing of any default by the Issuers or any Guarantor in making any

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such payment. If an Issuer or a Subsidiary acts as Paying Agent, it shall segregate the money held by it as Paying Agent and hold it as aseparate trust fund. The Issuers at any time may require a Paying Agent (other than the Trustee) to pay all money held by it to the Trustee andto account for any funds disbursed by such Paying Agent. Upon complying with this Section 2.4, the Paying Agent (if other than an Issuer or aSubsidiary) shall have no further liability for the money delivered to the Trustee. Upon any bankruptcy, reorganization or similar proceedingwith respect to any Issuer, the Trustee shall serve as Paying Agent for the Notes.

Section 2.5. Holder Lists. The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available toit of the names and addresses of Holders. If the Trustee is not the Registrar, or to the extent otherwise required under the TIA, the Issuers shallfurnish to the Trustee, in writing at least five Business Days before each interest payment date and at such other times as the Trustee mayrequest in writing, a list in such form and as of such date as the Trustee may reasonably require of the names and addresses of Holders.

Section 2.6. Transfer and Exchange.

(a) The following provisions shall apply with respect to any proposed transfer of a Rule 144A Note prior to the date which is two yearsafter the later of the date of its original issue and the last date on which the Issuers or any Affiliate of the Issuers was the owner of such Notes(or any predecessor thereto) (the "Resale Restriction Termination Date"):

(1) a transfer of a Rule 144A Note or a beneficial interest therein to a QIB shall be made upon the representation of thetransferee in the form as set forth on the reverse of the Note that it is purchasing for its own account or an account with respect towhich it exercises sole investment discretion and that it and any such account is a "qualified institutional buyer" within the meaningof Rule 144A, and is aware that the sale to it is being made in reliance on Rule 144A and acknowledges that it has received suchinformation regarding the Company as the undersigned has requested pursuant to Rule 144A or has determined not to request suchinformation and that it is aware that the transferor is relying upon its foregoing representations in order to claim the exemption fromregistration provided by Rule 144A; and

(2) a transfer of a Rule 144A Note or a beneficial interest therein to a Non-U.S. Person shall be made upon receipt by theTrustee or its agent of a certificate substantially in the form set forth in Section 2.7(a) from the proposed transferee and, if requestedby the Issuers or the Trustee, the delivery of an opinion of counsel, certification and/or other information satisfactory to each ofthem.

(b) (1) The following provisions shall apply with respect to any proposed exchange of beneficial interests in the Regulation S GlobalNote for beneficial interests in the Rule 144A Global Note prior to the expiration of the Restricted Period:

Prior to the expiration of the Restricted Period, beneficial interests in the Regulation S Global Note may be exchanged for beneficialinterests in the Rule 144A Global Note only if:

(A) such exchange occurs in connection with a transfer of the Notes pursuant to Rule 144A; and

(B) the transferor first delivers to the Trustee a written certificate substantially in the form set forth in Section 2.7(b) from theproposed transferee and, if requested by the Issuers or the Trustee, the delivery of an opinion of counsel, certification and/or otherinformation satisfactory to each of them.

After the expiration of the Restricted Period, interests in the Regulation S Note may be transferred without requiring the certification setforth in Section 2.7(b) or any additional certification.

(2) Beneficial interests in a Rule 144A Global Note may be transferred to a Person who takes delivery in the form of aninterest in the Regulation S Global Note, whether before or after the

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expiration of the Restricted Period, only if the transferor first delivers to the trustee a written certificate (substantially in the formprovided in Section 2.7(a)) to the effect that such transfer is being made in accordance with Rule 903 or 904 of Regulation S orRule 144 (if available) and that, if such transfer occurs prior to the expiration of the Restricted Period, the interest transferred will beheld immediately thereafter through Euroclear or Clearstream.

(3) Transfers involving exchanges of beneficial interests between the Regulation S Global Notes and the Rule 144A GlobalNotes will be effected by DTC by means of an instruction originated by the Trustee through the DTC Deposit/Withdraw atCustodian system. Accordingly, in connection with any such transfer, appropriate adjustments will be made to reflect a decrease inthe principal amount of the Regulation S Global Note and a corresponding increase in the principal amount of the Rule 144A GlobalNote or vice versa, as applicable. Any beneficial interest in one of the Global Notes that is transferred to a Person who takes deliveryin the form of an interest in the other Global Note will, upon transfer, cease to be an interest in such Global Note and will become aninterest in the other Global Note and, accordingly, will thereafter be subject to all transfer restrictions and other proceduresapplicable to beneficial interests in such other Global Note for so long as it remains such an interest. Notwithstanding anythingherein to the contrary, the policies and practices of DTC may prohibit transfers of beneficial interests in the Regulation S GlobalNote prior to the expiration of the Restricted Period.

(c) Private Placement Legend. Upon the transfer, exchange or replacement of Notes not bearing a Private Placement Legend, theRegistrar shall deliver Notes that do not bear a Private Placement Legend unless such transferee is an affiliate (as defined in Rule 144) of theIssuers. Upon the transfer, exchange or replacement of Notes bearing a Private Placement Legend, the Registrar shall deliver only Notes thatbear a Private Placement Legend unless there is delivered to the Registrar an Opinion of Counsel to the effect that neither such legend nor therelated restrictions on transfer are required in order to maintain compliance with the provisions of the Securities Act.

(d) The Registrar shall retain copies of all letters, notices and other written communications received pursuant to Section 2.1 or thisSection 2.6. The Issuers shall have the right to inspect and make copies of all such letters, notices or other written communications at anyreasonable time upon the giving of reasonable prior written notice to the Registrar.

(e) Obligations with Respect to Transfers and Exchanges of Notes.

(1) To permit registrations of transfers and exchanges, the Issuers shall, subject to the other terms and conditions of thisArticle II, execute, and the Trustee shall authenticate, Definitive Notes and Global Notes at the Registrar's or co-registrar's request.

(2) No service charge shall be made to a Holder for any registration of transfer or exchange, but the Issuers may requirepayment of a sum sufficient to cover any transfer tax, assessments, or similar governmental charge payable in connection therewith(other than any such transfer taxes, assessments or similar governmental charges payable upon exchange or transfer pursuant toSections 3.7, 3.9, 5.8 or 9.5).

(3) The Registrar or co-registrar shall not be required to register the transfer or exchange of (i) any Notes selected forredemption (except in the case of Notes to be redeemed in part, the portion of the Note not to be redeemed) or (ii) any Notes for aperiod beginning 15 days before a selection of Notes to be redeemed.

(4) Prior to the due presentation for registration of transfer of any Note, the Issuers, the Trustee, the Paying Agent, theRegistrar or any co-registrar may deem and treat the person in whose name a Note is registered as the absolute owner of such Notefor the purpose of receiving payment of principal of, premium, if any, on and interest and Special Interest, if any, on, such Note andfor all

32



other purposes whatsoever, whether or not such Note is overdue, and none of the Company, the Trustee, the Paying Agent, theRegistrar or any co-registrar shall be affected by notice to the contrary.

(5) Any Definitive Note delivered in exchange for an interest in a Global Note pursuant to Section 2.1(e) shall, except asotherwise provided by Section 2.6(c), bear the Private Placement Legend set forth in Section 2.1(d).

(6) All Notes issued upon any transfer or exchange pursuant to the terms of this Indenture shall evidence the same debt andshall be entitled to the same benefits under this Indenture as the Notes surrendered upon such transfer or exchange.

(7) The Registrar or any co-registrar may require certain documentation including but not limited to signature guarantees,before effecting any transfer or exchange.

(f) No Obligation of the Trustee

(1) The Trustee shall have no responsibility or obligation to any beneficial owner of a Global Note, a member of, or aparticipant in, DTC or other Person with respect to the accuracy of the records of DTC or its nominee or of any participant ormember thereof, with respect to any ownership interest in the Notes or with respect to the delivery to any participant, member,beneficial owner or other Person (other than DTC) of any notice (including any notice of redemption) or the payment of any amountor delivery of any Notes (or other Note or property) under or with respect to such Notes. All notices and communications to begiven to the Holders and all payments to be made to Holders in respect of the Notes shall be given or made only to or upon the orderof the registered Holders (which shall be DTC or its nominee in the case of a Global Note). The rights of beneficial owners in anyGlobal Note shall be exercised only through DTC subject to the applicable rules and procedures of DTC. The Trustee may rely andshall be fully protected in relying upon information furnished by DTC with respect to its members, participants and any beneficialowners.

(2) The Trustee shall have no obligation or duty to monitor, determine or inquire as to compliance with any restrictions ontransfer imposed under this Indenture or under applicable law with respect to any transfer of any interest in any Note (including anytransfers between or among DTC participants, members or beneficial owners in any Global Note) other than to require delivery ofsuch certificates and other documentation or evidence as are expressly required by, and to do so if and when expressly required by,the terms of this Indenture, and to examine the same to determine substantial compliance as to form with the express requirementshereof.

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Section 2.7. Form of Certificates to be Delivered in Connection with Transfers Pursuant to Regulation S and Rule 144A.

(a) Form of Certificate to be Delivered in Connection with Transfers Pursuant to Regulation S.

[Date]

Tronox Worldwide LLCTronox Finance Corp.Citibank, N.A., as Trustee111 Wall Street, 15th Floor WindowNew York, NY 10005Attention: Corporate Trust Services�Tronox Worldwide LLC

Re: Tronox Worldwide LLC and Tronox Finance Corp.% Senior Notes due 2012 (the "Notes")


In connection with our proposed sale of $ aggregate principal amount of the Notes, we confirm that such sale has beeneffected pursuant to and in accordance with Regulation S under the United States Securities Act of 1933, as amended (the "Securities Act"),and, accordingly, we represent that:

(a) the offer of the Notes was not made to a person in the United States;

(b) either (i) at the time the buy order was originated, the transferee was outside the United States or we and any person acting on ourbehalf reasonably believed that the transferee was outside the United States or (ii) the transaction was executed in, on or through the facilitiesof a designated off-shore securities market and neither we nor any person acting on our behalf knows that the transaction has been pre-arranged with a buyer in the United States;

(c) no directed selling efforts have been made in the United States in contravention of the requirements of Rule 903(b) or Rule 904(b) ofRegulation S, as applicable;

(d) the transaction is not part of a plan or scheme to evade the registration requirements of the Securities Act; and

(e) we have advised the transferee of the transfer restrictions applicable to the Notes.

The Trustee and the Issuers are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof toany interested party in any administrative or legal proceedings or official inquiry with respect to the matters covered hereby. Terms used inthis certificate have the meanings set forth in Regulation S.

Very truly yours,

[Name of Transferor]

By:

Authorized Signature

(b) Form of Certificate to be Delivered in Connection with Transfers Pursuant to Rule 144A.



[Date]

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Tronox Worldwide LLCTronox Finance Corp.Citibank, N.A., as Trustee111 Wall Street, 15th Floor WindowNew York, NY 10005Attention: Corporate Trust Services�Tronox Worldwide LLC

Re: Tronox Worldwide LLC and Tronox Finance Corp.% Senior Notes due 2012 (the "Notes")


In connection with our proposed sale of $ aggregate principal amount of the Notes, we confirm that such sale has beeneffected pursuant to and in accordance with Rule 144A ("Rule 144A") under the United States Securities Act of 1933, as amended (the"Securities Act"), and, accordingly, we represent that the Notes are being transferred to a Person:

(a) that we reasonably believe to be a qualified institutional buyer (as defined in Rule 144A under the Securities Act) (a "QIB");

(b) purchasing for its own account or the account of a QIB in a transaction meeting the requirements of Rule 144A; and

(c) in accordance with all applicable securities laws of the states of the United States and other jurisdictions.

The Trustee and the Issuers are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof toany interested party in any administrative or legal proceedings or official inquiry with respect to the matters covered hereby.

Very truly yours,

[Name of Transferor]

By:

Authorized Signature

Section 2.8. Mutilated, Destroyed, Lost or Wrongfully Taken Notes. If a mutilated Note is surrendered to the Registrar or if theHolder of a Note claims that the Note has been lost, destroyed or wrongfully taken, the Issuers shall issue and the Trustee shall authenticate areplacement Note of like tenor and principal amount, bearing a number not contemporaneously outstanding if the requirements ofSection 8-405 of the Uniform Commercial Code are met, such that the Holder (a) makes such request to the Issuers or Trustee prior to theIssuer or Trustee having notice that the Note has been acquired by a protected purchaser as defined in Section 8-303 of the UniformCommercial Code (a "protected purchaser"), (b) files with the Issuer or the Trustee an indemnity bond, sufficient in the judgment of theIssuers and the Trustee to protect the Issuers, the Trustee, the Paying Agent, the Registrar and any co-registrar from any loss which any ofthem may suffer if a Note is replaced, and, in the absence of notice to the Issuers or the Trustee that such Note has been acquired by aprotected purchaser and (c) satisfies any other reasonable requirements of the Trustee.

In case any such mutilated, destroyed, lost or wrongfully taken Note has become or is about to become due and payable, the Issuers intheir discretion may, instead of issuing a new Note, pay such Note.

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Upon the issuance of any new Note under this Section 2.8, the Issuers may require the payment of a sum sufficient to cover any tax orother governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Trustee) inconnection therewith.

Every new Note issued pursuant to this Section in lieu of any mutilated, destroyed, lost or wrongfully taken Note shall constitute anoriginal additional contractual obligation of the Issuers, any Guarantor (if applicable) and any other obligor upon the Notes, whether or not themutilated, destroyed, lost or wrongfully taken Note shall be at any time enforceable by anyone, and shall be entitled to all benefits of thisIndenture equally and proportionately with any and all other Notes duly issued hereunder.

The provisions of this Section 2.8 are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to thereplacement or payment of mutilated, destroyed, lost or wrongfully taken Notes.

Section 2.9. Outstanding Notes. Notes outstanding at any time are all Notes authenticated by the Trustee except for those canceled byit, those accepted by it for cancellation and those described in this Section 2.9 as not outstanding. A Note ceases to be outstanding in the eventParent, any Issuer or a Subsidiary of Parent or of any Issuer holds the Note, provided, however, that (i) for purposes of determining which areoutstanding for consent or voting purposes hereunder, the provisions of Section 12.6 shall apply and (ii) in determining whether the Trusteeshall be protected in making a determination whether the Holders of the requisite principal amount of outstanding Notes are present at ameeting of Holders of Notes for quorum purposes or have consented to or voted in favor of any request, demand, authorization, direction,notice, consent, waiver, amendment or modification hereunder, or relying upon any such quorum, consent or vote, only Notes which a TrustOfficer of the Trustee actually knows to be held by Parent or an Affiliate thereof shall not be considered outstanding.

If a Note is replaced pursuant to Section 2.8, it ceases to be outstanding unless the Trustee and the Issuers receive proof satisfactory tothem that the replaced Note is held by a protected purchaser.

If the Paying Agent segregates and holds in trust, in accordance with this Indenture, on a Redemption Date or maturity date moneysufficient to pay all principal, premium, if any, and interest and Special Interest, if any, payable on that date with respect to the Notes (orportions thereof) to be redeemed or maturing, as the case may be, and the Paying Agent is not prohibited from paying such money to theHolders on that date pursuant to the terms of this Indenture, then on and after that date such Notes (or portions thereof) cease to be outstandingand interest on them ceases to accrue.

Section 2.10. Cancellation. The Issuers at any time may deliver Notes to the Trustee for cancellation. The Registrar and the PayingAgent shall forward to the Trustee any Notes surrendered to them for registration of transfer, exchange or payment. The Trustee and no oneelse shall cancel all Notes surrendered for registration of transfer, exchange, payment or cancellation and destroy such Notes in accordancewith its internal policies, including delivery of a certificate (a "Certificate of Destruction") describing such Notes disposal (subject to therecord retention requirements of the Exchange Act). The Issuers may not issue new Notes to replace Notes they have paid or delivered to theTrustee for cancellation for any reason other than in connection with a transfer or exchange.

Section 2.11. Payment of Interest; Defaulted Interest. Interest and Special Interest, if any, on any Note which is payable, and ispunctually paid or duly provided for, on any interest payment date shall be paid to the Person in whose name such Note (or one or morepredecessor Notes) is registered at the close of business on the regular record date for such interest at the office or agency of the Issuersmaintained for such purpose pursuant to Section 2.3.

Any interest and Special Interest, if any, on any Note which is payable, but is not paid when the same becomes due and payable and suchnonpayment continues for a period of 30 days shall forthwith cease to be payable to the Holder on the regular record date, and such defaultedinterest and (to the extent lawful) interest on such defaulted interest at the rate borne by the Notes (such defaulted interest and interest

36



thereon herein collectively called "Defaulted Interest") shall be paid by the Issuers, at their election in each case, as provided in clause (a) or(b) below:

(a) The Issuers may elect to make payment of any Defaulted Interest to the Persons in whose names the Notes (or their respectivepredecessor Notes) are registered at the close of business on a Special Record Date (as defined below) for the payment of such DefaultedInterest, which shall be fixed in the following manner. The Issuers shall notify the Trustee in writing of the amount of Defaulted Interestproposed to be paid on each Note and the date (not less than 30 days after such notice) of the proposed payment (the "Special Interest PaymentDate"), and at the same time the Issuers shall deposit with the Trustee an amount of money equal to the aggregate amount proposed to be paidin respect of such Defaulted Interest or shall make arrangements satisfactory to the Trustee for such deposit prior to the date of the proposedpayment, such money when deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Interest as in this clauseprovided. Thereupon the Trustee shall fix a record date (the "Special Record Date") for the payment of such Defaulted Interest, which dateshall be not more than 15 days and not less than 10 days prior to the Special Interest Payment Date and not less than 10 days after the receiptby the Trustee of the notice of the proposed payment. The Trustee shall promptly notify the Issuers of such Special Record Date, and in thename and at the expense of the Issuers, shall cause notice of the proposed payment of such Defaulted Interest and the Special Record Date andSpecial Interest Payment Date therefor to be given in the manner provided for in Section 12.2, not less than 10 days prior to such SpecialRecord Date. Notice of the proposed payment of such Defaulted Interest and the Special Record Date and Special Interest Payment Datetherefor having been so given, such Defaulted Interest shall be paid on the Special Interest Payment Date to the Persons in whose names theNotes (or their respective predecessor Notes) are registered at the close of business on such Special Record Date and shall no longer bepayable pursuant to the following clause (b).

(b) The Issuers may make payment of any Defaulted Interest in any other lawful manner not inconsistent with the requirements of anysecurities exchange on which the Notes may be listed, and upon such notice as may be required by such exchange, if, after notice given by theIssuers to the Trustee of the proposed payment pursuant to this clause, such manner of payment shall be deemed practicable by the Trustee.

Subject to the foregoing provisions of this Section 2.11, each Note delivered under this Indenture upon registration of, transfer of or inexchange for or in lieu of any other Note shall carry the rights to interest and Special Interest, if any, each as accrued and unpaid, and toaccrue, which were carried by such other Note.

Section 2.12. Computation of Interest. Interest on the Notes shall be computed on the basis of a 360-day year of twelve 30-daymonths.

Section 2.13. CUSIP Numbers. The Issuers in issuing the Notes may use "CUSIP" numbers (if then generally in use) and, if so, theTrustee shall use "CUSIP" numbers in notices of redemption as a convenience to Holders; provided, however, that any such notice may statethat no representation is made as to the correctness of such numbers either as printed on the Notes or as contained in any notice of aredemption and that reliance may be placed only on the other identification numbers printed on the Notes, and any such redemption shall notbe affected by any defect in or omission of such CUSIP numbers. The Issuers shall promptly notify the Trustee in writing of any change in theCUSIP numbers.

ARTICLE III

Covenants

Section 3.1. Payment of Notes. The Company shall promptly pay the principal of, premium, if any, on, and interest and SpecialInterest, if any, on, the Notes on the dates and in the manner provided in the Notes and in this Indenture. Principal, premium, if any, interestand Special Interest, if any, shall be

37



considered paid on the date due if on such date the Trustee or the Paying Agent, in its capacity as Trustee or Paying Agent, respectively, holdsin accordance with this Indenture immediately available funds deposited by or on behalf of the Issuer or the Guarantor sufficient to pay allprincipal, premium, interest and Special Interest, if any, then due and the Trustee or Paying Agent, as the case may be, is not prohibited frompaying money to the Holders on that date pursuant to the terms of this Indenture.

The Issuers shall pay interest on overdue principal at the rate specified therefor in the Notes, and it shall pay interest on overdueinstallments of interest at the same rate to the extent lawful.

Notwithstanding anything to the contrary contained in this Indenture, the Issuers may, to the extent they are required to do so by law,deduct or withhold income or other similar taxes imposed by the United States of America from principal or interest payments hereunder.

Section 3.2. Reports. Whether or not required by the rules and regulations of the Commission, so long as any Notes are outstanding,the Company will cause Parent to file with the Commission for public availability within the time periods specified in the Commission's rulesand regulations (unless the Commission will not accept such a filing), and (if not filed electronically with the Commission) within suchperiods the Company will cause Parent to furnish to the Holders of Notes or cause the Trustee to make available to such Holders forinspection:

(a) all quarterly and annual financial and other information with respect to Parent and its Subsidiaries that would be required to becontained in a filing with the Commission on Forms 10-Q and 10-K if Parent were required to file such Forms, including a "Management'sDiscussion and Analysis of Financial Condition and Results of Operations" and, with respect to the annual information only, a report onParent's consolidated financial statements by Parent's certified independent accountants; and

(b) all current reports and other information that would be required to be filed with the Commission on Form 8-K if Parent wererequired to file such reports.

The delivery of all such reports, documents and information to the Trustee does not imply any knowledge by the Trustee of the contentsthereof nor shall such delivery constitute constructive notice of any information contained therein or determinable thereby or require anyaction by the Trustee other than to maintain the reports for examination by the Holders.

If, at any time, Parent is no longer subject to the periodic reporting requirements of the Exchange Act for any reason, the Company willnevertheless cause Parent to continue filing the reports specified in the preceding paragraphs of this covenant with the Commission within thetime periods specified above unless the Commission will not accept such a filing. The Company will not permit Parent to take any action forthe purpose of causing the Commission not to accept any such filings. If, notwithstanding the foregoing, the Commission will not acceptParent's filings for any reason, the Company will cause Parent to post the reports referred to in the preceding paragraphs on its website withinthe time periods that would apply if Parent were required to file those reports with the SEC.

In addition, the Company and the Guarantors shall, for so long as any Notes remain outstanding, if at any time they are not required tofile the reports required by the preceding paragraphs with the Commission, furnish to the Holders and to securities analysts and prospectiveinvestors in the Notes, upon their request, the information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act.

Section 3.3. Incurrence of Indebtedness and Issuance of Preferred Stock.

(a) The Company will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume,guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness(including Acquired Debt), and the Company will not issue any Disqualified Stock and will not permit any of its Restricted Subsidiaries toissue any shares of Preferred Stock; provided, however, that the Company and its

38



Restricted Subsidiaries that are Guarantors may incur Indebtedness (including Acquired Debt) or issue Disqualified Stock, if the Fixed ChargeCoverage Ratio for the Company's most recently ended four full fiscal quarters for which internal financial statements are availableimmediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock is issued, as the case may be,would have been at least 2.0 to 1, determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if theadditional Indebtedness had been incurred or the Disqualified Stock had been issued, as the case may be, at the beginning of such four-quarterperiod.

(b) The provisions of Section 3.3(a) will not prohibit the incurrence of any of the following items of Indebtedness (collectively,"Permitted Debt"):

(1) the incurrence by the Company and any Guarantor of Indebtedness and letters of credit under Credit Facilities in anaggregate principal amount at any one time outstanding under this Section 3.3(b)(1) (with letters of credit being deemed to have aprincipal amount equal to the maximum potential liability of the Company and its Restricted Subsidiaries thereunder) not to exceedthe greater of $450.0 million and the Borrowing Base;

(2) the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness;

(3) the incurrence by the Company and the Guarantors of Indebtedness represented by the Initial Notes and the related NoteGuarantees to be issued on the Issue Date and the Exchange Notes and the related Note Guarantees to be issued pursuant to theRegistration Rights Agreement;

(4) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness represented by Capital LeaseObligations, mortgage financings or purchase money obligations, in each case, incurred for the purpose of financing all or any partof the purchase price or cost of design, construction, installation or improvement of property, plant or equipment used in thebusiness of the Company or any of its Restricted Subsidiaries, in an aggregate principal amount, including all Permitted RefinancingIndebtedness incurred to renew, refund, refinance, replace, defease or discharge any Indebtedness incurred pursuant to thisSection 3.3(b)(4), at any time outstanding, not to exceed the greater of (a) $25.0 million and (b) 1.5% of Consolidated Net TangibleAssets;

(5) the incurrence by the Company or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchangefor, or the net proceeds of which are used to renew, refund, refinance, replace, defease or discharge any Indebtedness (other thanintercompany Indebtedness) that was permitted by this Indenture to be incurred under Section 3.3(a) or clauses (2), (3), (4) or (5) ofthis Section 3.3(b);

(6) the incurrence by the Company or any of its Restricted Subsidiaries of intercompany Indebtedness between or among theCompany and any of its Restricted Subsidiaries; provided, however, that:

(a) if the Company or any Guarantor is the obligor on such Indebtedness and the payee is not the Company or aGuarantor, such Indebtedness must be expressly subordinated to the prior payment in full in cash of all Obligations thendue with respect to the Notes, in the case of the Company, or the Note Guarantee, in the case of a Guarantor; and

(b) (i) any subsequent issuance or transfer of Equity Interests that results in any such Indebtedness being held by aPerson other than the Company or a Restricted Subsidiary of the Company and (ii) any sale or other transfer of any suchIndebtedness to a Person that is not either the Company or a Restricted Subsidiary of the Company, will be deemed, ineach case, to constitute an incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case maybe, that was not permitted by this Section 3.3(b)(6);

39



(7) the issuance by any of the Company's Restricted Subsidiaries to the Company or to any of its Restricted Subsidiaries ofshares of Preferred Stock; provided, however, that:

(a) any subsequent issuance or transfer of Equity Interests that results in any such Preferred Stock being held by aPerson other than the Company or a Restricted Subsidiary of the Company; and

(b) any sale or other transfer of any such Preferred Stock to a Person that is not either the Company or a RestrictedSubsidiary of the Company,

will be deemed, in each case, to constitute an issuance of such Preferred Stock by such Restricted Subsidiary that was not permittedby this Section 3.3(b)(7);

(8) the incurrence by the Company or any of its Restricted Subsidiaries of Hedging Obligations in the ordinary course ofbusiness;

(9) the guarantee by the Company or any of the Guarantors of Indebtedness of the Company or a Restricted Subsidiary of theCompany that was permitted to be incurred by another provision of this covenant; provided that if the Indebtedness beingguaranteed is subordinated to or pari passu with the Notes, then the guarantee shall be subordinated or pari passu, as applicable, tothe same extent as the Indebtedness guaranteed;

(10) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness (including letters of credit) in respectof workers' compensation claims, self-insurance obligations, bankers' acceptances, performance and surety bonds in the ordinarycourse of business;

(11) the incurrence by the Company or any of its Restricted Subsidiaries of Indebtedness (including letters of credit) arisingfrom the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently drawn againstinsufficient funds, so long as such Indebtedness is covered within five business days;

(12) the incurrence by Foreign Subsidiaries of Indebtedness in an aggregate principal amount at any time outstanding pursuantto this Section 3.3(b)(12), not to exceed the greater of (a) $30.0 million and (b) 5.0% of the combined Consolidated Tangible Assetsof the Foreign Subsidiaries (or the equivalent thereof, measured at the time of each incurrence, in applicable foreign currency);

(13) Indebtedness consisting of the financing of insurance premiums in customary amounts consistent with the operations andbusiness of the Issuers and the Restricted Subsidiaries;

(14) Indebtedness incurred by a Receivables Subsidiary in a Qualified Receivables Financing that is not recourse to theCompany or any Restricted Subsidiary of the Company other than a Receivables Subsidiary (except for Standard SecuritizationUndertakings);

(15) Indebtedness or Preferred Stock of Persons that are acquired by the Company or any Restricted Subsidiary or merged intothe Company or a Restricted Subsidiary in accordance with the terms of this Indenture; provided that such Indebtedness or PreferredStock is not incurred in connection with or in contemplation of such acquisition or merger; and provided, further, that after givingeffect to such acquisition or merger, the Company or such Restricted Subsidiary would be permitted to incur at least $1.00 ofadditional Indebtedness under Section 3.3(a); and

(16) the incurrence by the Company or any of the Restricted Subsidiaries of additional Indebtedness in an aggregate principalamount (or accreted value, as applicable) at any time outstanding, not to exceed $35.0 million.



(c) Notwithstanding the foregoing, neither the Issuers nor any Guarantor will incur any Indebtedness (including Permitted Debt) that iscontractually subordinated in right of payment to any other Indebtedness of any Issuer or such Guarantor unless such Indebtedness is alsocontractually subordinated

40



in right of payment to the Notes and the applicable Note Guarantee on substantially identical terms; provided, however, that no Indebtednesswill be deemed to be contractually subordinated in right of payment to any other Indebtedness of an Issuer solely by virtue of being unsecuredor by virtue of being secured on a first or junior Lien basis.

(d) For purposes of determining compliance with this Section 3.3, in the event that an item of proposed Indebtedness meets the criteriaof more than one of the categories of Permitted Debt described in Section 3.3(b)(1) through (16) above, or is entitled to be incurred pursuantto Section 3.3(a), the Company will be permitted to classify such item of Indebtedness on the date of its incurrence, or later reclassify all or aportion of such item of Indebtedness, in any manner that complies with this covenant. Indebtedness under Credit Facilities outstanding on thedate on which Notes are first issued and authenticated under this Indenture will initially be deemed to have been incurred on such date inreliance on Section 3.3(b)(1).

(e) The accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in theform of additional Indebtedness with the same terms, the reclassification of Preferred Stock as Indebtedness due to a change in accountingprinciples, and the payment of dividends on Disqualified Stock in the form of additional shares of the same class of Disqualified Stock willnot be deemed to be an incurrence of Indebtedness or an issuance of Disqualified Stock for purposes of this covenant; provided, in each suchcase, that the amount of any such accrual, accretion or payment is included in Fixed Charges of the Company as accrued. Notwithstanding anyother provision of this covenant, the maximum amount of Indebtedness that the Company or any Restricted Subsidiary may incur pursuant tothis covenant shall not be deemed to be exceeded solely as a result of fluctuations in exchange rates or currency values.

(f) The amount of any Indebtedness outstanding as of any date will be:

(1) the accreted value of the Indebtedness, in the case of any Indebtedness issued with original issue discount;

(2) the principal amount of the Indebtedness, together with any interest on the Indebtedness that is more than 30 days past due,in the case of any other Indebtedness; and

(3) in respect of Indebtedness of another Person secured by a Lien on the assets of the specified Person, the lesser of:

(A) the Fair Market Value of such assets at the date of determination; and

(B) the amount of the Indebtedness of the other Person.

If at any time an Unrestricted Subsidiary becomes a Restricted Subsidiary, any Indebtedness of such Subsidiary shall be deemed to be incurredby a Restricted Subsidiary of the Company as of such date (and, if such Indebtedness is not permitted to be incurred as of such date under thisSection 3.3, the Company shall be in Default of this Section 3.3).

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Section 3.4. Restricted Payments.

(a) The Issuers will not, and will not permit any of their Restricted Subsidiaries to, directly or indirectly:

(1) declare or pay any dividend or make any other payment or distribution on account of the Company's or any of itsRestricted Subsidiaries' Equity Interests or to the direct or indirect holders of the Company's or any of its Restricted Subsidiaries'Equity Interests in their capacity as such (other than dividends or distributions payable in Equity Interests (other than DisqualifiedStock) of the Company and other than dividends or distributions payable to the Company or a Restricted Subsidiary of theCompany);

(2) purchase, redeem or otherwise acquire or retire for value any Equity Interests of the Company or any direct or indirectparent of the Company other than Equity Interests owned by the Company or any Restricted Subsidiary;

(3) make any payment on or with respect to, or purchase, redeem, defease or otherwise acquire or retire for value anyIndebtedness of the Company or any Guarantor that is contractually subordinated to the Notes or to any Note Guarantee (excludingany intercompany Indebtedness between or among the Company and any of its Restricted Subsidiaries), except (A) a payment ofinterest or principal at the Stated Maturity thereof and (B) the purchase, repurchase or other acquisition of Indebtedness inanticipation of satisfying a sinking fund obligation, principal installment or final maturity, in each case due within one year of thedate of such purchase, repurchase or acquisition; or

(4) make any Restricted Investment

(all such payments and other actions set forth in clauses (1) through (4) above being collectively referred to as "Restricted Payments"),

unless, at the time of and after giving effect to such Restricted Payment:

(1) no Default has occurred and is continuing or would occur as a consequence of such Restricted Payment;

(2) the Company would, at the time of such Restricted Payment and after giving pro forma effect thereto as if such RestrictedPayment had been made at the beginning of the applicable four-quarter period, have been permitted to incur at least $1.00 ofadditional Indebtedness pursuant to Section 3.3(a); or

(3) such Restricted Payment, together with the aggregate amount of all other Restricted Payments made by the Company andits Restricted Subsidiaries since the Issue Date (excluding Restricted Payments permitted by clauses (2), (3), (4), (5), (6), (7), (8),(9), (14) and (16) of Section 3.4(b)), is less than the sum, without duplication, of:

(A) 50% of the Consolidated Net Income of the Company for the period (taken as one accounting period) from thebeginning of the first fiscal quarter commencing after the Issue Date to the end of the Company's most recently endedfiscal quarter for which internal financial statements are available at the time of such Restricted Payment (or, if suchConsolidated Net Income for such period is a deficit, less 100% of such deficit); plus

(B) 100% of the aggregate net cash proceeds received, and the Fair Market Value of property received from a non-Affiliate for use in a Permitted Business, by the Company since the Issue Date as a contribution to its common equitycapital or from the issue or sale of Equity Interests of the Company (other than Disqualified Stock) or from the issue orsale of convertible or exchangeable Disqualified Stock or convertible or exchangeable debt securities of the Company thathave been converted into or exchanged for such Equity Interests (other than

42



Equity Interests (or Disqualified Stock or debt securities) sold to a Subsidiary of the Company or an employee stockownership plan, option plan or similar trust to the extent such sale to an employee stock ownership plan or similar trust isfinanced by loans from or guaranteed by the Company or any of its Restricted Subsidiaries unless such loans have beenrepaid with cash on or prior to the date of determination); plus

(C) to the extent that any Restricted Investment that was made after the Issue Date is sold for cash or otherwiseliquidated or repaid for cash, the lesser of (i) the cash return of capital with respect to such Restricted Investment (less thecost of disposition, if any) and (ii) the initial amount of such Restricted Investment; plus

(D) to the extent that any Unrestricted Subsidiary of the Company designated as such after the Issue Date isredesignated as a Restricted Subsidiary after the Issue Date, the lesser of (i) the Fair Market Value of the Company'sInvestment in such Subsidiary as of the date of such redesignation or (ii) such Fair Market Value as of the date on whichsuch Subsidiary was originally designated as an Unrestricted Subsidiary after the Issue Date; plus

(E) 50% of any dividends received by the Company or a Restricted Subsidiary of the Company that is a Guarantorafter the Issue Date from an Unrestricted Subsidiary of the Company, to the extent that such dividends were not otherwiseincluded in the Consolidated Net Income of the Company for such period; plus

(F) $10.0 million.

(b) So long as no Default has occurred and is continuing or would be caused thereby, the preceding provisions of Section 3.4(a) will notprohibit:

(1) the payment of any dividend or the consummation of any irrevocable redemption within 60 days after the date ofdeclaration of the dividend or giving of the redemption notice, as the case may be, if at the date of declaration or notice, the dividendor redemption payment would have complied with the provisions of this Indenture;

(2) the making of any Restricted Payment in exchange for, or out of the net cash proceeds of the substantially concurrent sale(other than to a Subsidiary of the Company) of, Equity Interests of the Company (other than Disqualified Stock and other thanEquity Interests issued or sold to an employee stock ownership plan or similar trust is financed by loans from or guaranteed by theCompany or any of its Restricted Subsidiaries unless such loans have been repaid with cash on or prior to the date of determination)or from the substantially concurrent contribution of common equity capital to the Company; provided that the amount of any suchnet cash proceeds that are utilized for any such Restricted Payment will be excluded from clause (3)(B) of the preceding paragraph;

(3) the repurchase, redemption, defeasance or other acquisition or retirement for value of Indebtedness of the Company or anyGuarantor that is contractually subordinated to the Notes or to any Note Guarantee with the net cash proceeds from a substantiallyconcurrent incurrence of Permitted Refinancing Indebtedness;

(4) the payment of any dividend (or, in the case of any partnership or limited liability company, any similar distribution) by aRestricted Subsidiary of the Company (including a Receivables Subsidiary) to the holders of its Equity Interests on a pro rata basis;

(5) the repurchase, redemption or other acquisition or retirement for value of any Equity Interests of the Company, anyRestricted Subsidiary of the Company or Parent held by any then-current or former officer, director or employee of the Company,any of its Restricted Subsidiaries or Parent pursuant to any equity subscription agreement, stock option agreement, shareholders'agreement, management equity plan, incentive plan, stock option plan, or any other similar management or employee benefit plan;provided that the aggregate price paid for all such

43



repurchased, redeemed, acquired or retired Equity Interests may not exceed $5.0 million in any twelve-month period (with unusedamounts in any such 12-month period being carried over to the next (and only the next) succeeding 12-month period);

(6) the repurchase of Equity Interests deemed to occur upon the exercise of stock options or vesting of restricted stock to theextent such Equity Interests represent a portion of the exercise price of those stock options or the withholding tax obligations withrespect to such exercise or vesting;

(7) the declaration and payment of regularly scheduled or accrued dividends to holders of any class or series of DisqualifiedStock of the Company or any Restricted Subsidiary of the Company issued on or after the Issue Date in accordance withSection 3.3(a);

(8) any payments made in connection with the consummation of the transactions closing contemporaneously with the issuanceof the Initial Notes on the Issue Date on substantially the terms described in the Offering Memorandum;

(9) so long as no Default has occurred and is continuing or would be caused thereby, repurchases of Indebtedness that issubordinated to the Notes or a Note Guarantee at a purchase price not greater than (i) 101% of the principal amount of suchsubordinated Indebtedness in the event of a Change of Control or (ii) 100% of the principal amount of such subordinatedIndebtedness in the event of an Asset Sale, in each case plus accrued interest, in connection with any change of control offer or assetsale offer required by the terms of such Indebtedness, but only if:

(A) in the case of a Change of Control, the Company has first complied with and fully satisfied its obligations underSection 3.9; or

(B) in the case of an Asset Sale, the Company has complied with and fully satisfied its obligations under Section 3.7;

(10) the repurchase, redemption or other acquisition for value of Capital Stock of the Company or any direct or indirect parentof the Company representing fractional shares of such Capital Stock in connection with a merger, consolidation, amalgamation orother combination involving the Company or any direct or indirect parent of the Company;

(11) purchases of receivables pursuant to a Receivables Repurchase Obligation in connection with a Qualified ReceivablesFinancing;

(12) payments contemplated by the Transition Agreements as in effect on the Issue Date, as the Transition Agreements may beamended, modified or supplemented from time to time; provided, however, that any future amendment, modification, or supplemententered into after the Issue Date will be permitted to the extent that its terms do not adversely affect, as a whole, the rights of anyHolders of the Notes as compared to the terms of the agreements in effect on the Issue Date;

(13) the payment of dividends on the Company's common equity capital (or the payment of dividends to Parent to fund apayment of dividends on Parent's common stock) after the Issue Date, of an amount per annum equal to up to 6% of the net proceedsof Parent's public equity offering closing on the Issue Date; provided that any amounts so utilized are excluded from the calculationset forth in Section 3.4(a)(3)(B) above;

(14) Permitted Payments to Parent in the ordinary course of business;

(15) the distribution, as a dividend or otherwise, of shares of Capital Stock of, or Indebtedness owed by the Company or aRestricted Subsidiary of the Company to, Unrestricted Subsidiaries;

(16) payments to Parent in respect of the tax liabilities owed by Parent as a result of Parent's ownership of membership interestsin the Company or as a result of Parent being the common parent of any consolidated or combined tax group under applicable law("Tax Payments"). Any Tax Payment

44



received from the Company or its Subsidiaries shall be paid over to the appropriate taxing authority within 30 days of Parent'sreceipt of such Tax Payments or refunded to the Company or the relevant Subsidiary; and

(17) other Restricted Payments in an aggregate amount not to exceed $20.0 million since the Issue Date.

(c) The amount of all Restricted Payments (other than cash) will be the Fair Market Value on the date of the Restricted Payment of theasset(s) or securities proposed to be transferred or issued by the Company or such Restricted Subsidiary, as the case may be, pursuant to theRestricted Payment. The Fair Market Value of any assets or securities that are required to be valued by this covenant will be determined by theBoard of Directors of the Company whose resolution with respect thereto will be delivered to the Trustee. For purposes of determiningcompliance with this Section 3.4, in the event that a Restricted Payment meets the criteria of more than one of the exceptions described in(1) through (17) above or is entitled to be made pursuant to Section 3.4(a), the Company shall, in its sole discretion, classify such RestrictedPayment, or later classify, reclassify or re-divide all or a portion of such Restricted Payment, in any manner that complies with thisSection 3.4.

Section 3.5. Liens. The Company will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, create,incur, assume or suffer to exist any Lien of any kind on any asset now owned or hereafter acquired, except Permitted Liens.

Section 3.6. Dividend and Other Payment Restrictions Affecting Subsidiaries.

(a) The Company will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, create or permit to exist orbecome effective any consensual encumbrance or restriction on the ability of any Restricted Subsidiary to:

(1) pay dividends or make any other distributions on its Capital Stock to the Company or any of its Restricted Subsidiaries, orwith respect to any other interest or participation in, or measured by, its profits, or pay any Indebtedness owed to the Company orany of its Restricted Subsidiaries;

(2) make loans or advances to the Company or any of its Restricted Subsidiaries; or

(3) sell, lease or transfer any of its properties or assets to the Company or any of its Restricted Subsidiaries.

(b) However, the preceding restrictions will not apply to encumbrances or restrictions existing under or by reason of:

(1) agreements governing Existing Indebtedness and Credit Facilities as in effect on the Issue Date and any amendments,restatements, modifications, renewals, supplements, refundings, replacements or refinancings of those agreements, provided that theamendments, restatements, modifications, renewals, supplements, refundings, replacement or refinancings are not materially morerestrictive, taken as a whole, with respect to such dividend and other payment restrictions than those contained in those agreementson the Issue Date;

(2) this Indenture, the Notes and the Note Guarantees;

(3) applicable law, or any applicable rule, regulation or order;

(4) any agreement or other instrument governing Indebtedness or Capital Stock of a Person acquired by the Company or anyof its Restricted Subsidiaries as in effect at the time of such acquisition (except to the extent such Indebtedness or Capital Stock wasincurred in connection with or in contemplation of such acquisition), which encumbrance or restriction is not applicable to anyPerson, or the properties or assets of any Person, other than the Person, or the property or assets of

45



the Person, so acquired; provided that, in the case of Indebtedness, such Indebtedness was permitted by the terms of this Indenture tobe incurred;

(5) customary non-assignment provisions in contracts and licenses (including licenses of intellectual property) entered into inthe ordinary course of business;

(6) purchase money obligations for property acquired in the ordinary course of business and Capital Lease Obligations thatimpose restrictions on the property purchased or leased of the nature described in Section 3.6(a)(3);

(7) any agreement for the sale or other disposition of assets, including an agreement for the sale or other disposition of aRestricted Subsidiary, that restricts distributions by the applicable Restricted Subsidiary pending the sale or other disposition;

(8) Permitted Refinancing Indebtedness; provided that the restrictions contained in the agreements governing such PermittedRefinancing Indebtedness are not materially more restrictive, taken as a whole, than those contained in the agreements governing theIndebtedness being refinanced;

(9) Liens permitted to be incurred under Section 3.5 that limit the right of the debtor to dispose of the assets subject to suchLiens;

(10) provisions limiting the disposition or distribution of assets or property in joint venture agreements, asset sale agreements,sale-leaseback agreements, stock sale agreements and other similar agreements entered into with the approval of the Company'sBoard of Directors, which limitation is applicable only to the assets that are the subject of such agreements;

(11) provisions with respect to the disposition or distribution of assets or property in joint venture agreements, stockholderagreements, asset sale agreements, stock sale agreements and other similar agreements entered into in the ordinary course ofbusiness;

(12) other Indebtedness of the Company or any Restricted Subsidiary permitted to be incurred pursuant to an agreement enteredinto subsequent to the Issue Date in accordance with Section 3.3; provided that the provisions relating to such encumbrance orrestriction contained in such Indebtedness are not materially less favorable to the Company taken as a whole, as determined by theBoard of Directors of Parent in good faith, than the provisions contained in the Credit Agreement and in this Indenture as each is ineffect on the closing date of the Credit Agreement and the Issue Date under the Indenture, respectively;

(13) the issuance of Preferred Stock by a Restricted Subsidiary or the payment of dividends thereon in accordance with theterms thereof; provided that issuance of such Preferred Stock is permitted pursuant to Section 3.3 and the terms of such PreferredStock do not expressly restrict the ability of a Restricted Subsidiary to pay dividends or make any other distributions on its CapitalStock (other than requirements to pay dividends or liquidation preferences on such Preferred Stock prior to paying any dividends ormaking any other distributions on such other Capital Stock);

(14) supermajority voting requirements existing under corporate charters, by laws, stockholders agreements and similardocuments and agreements;

(15) any encumbrance or restriction of a Receivables Subsidiary effected in connection with a Qualified ReceivablesFinancing; provided, however, that such restrictions apply only to such Receivables Subsidiary;

(16) customary provisions restricting subletting or assignment of any lease governing a leasehold interest; and

46



(17) restrictions on cash or other deposits or net worth imposed by customers under contracts entered into in the ordinarycourse of business.

Section 3.7. Asset Sales.

(a) The Issuers will not, and will not permit any of the Company's Restricted Subsidiaries to, consummate an Asset Sale unless:

(1) the Company (or the Restricted Subsidiary, as the case may be) receives consideration at the time of the Asset Sale at leastequal to the Fair Market Value of the assets or Equity Interests issued or sold or otherwise disposed of; and

(2) at least 75% of the consideration received in the Asset Sale by the Company or such Restricted Subsidiary is in the form ofcash, Cash Equivalents or Additional Assets. For purposes of this provision, each of the following will be deemed to be cash:

(A) any liabilities, as shown on the Company's most recent consolidated balance sheet, of the Company or anyRestricted Subsidiary (other than contingent liabilities and liabilities that are by their terms subordinated to the Notes orany Note Guarantee) that are assumed by the transferee of any such assets pursuant to a customary novation agreementthat releases the Company or such Restricted Subsidiary from any further liability;

(B) any securities, notes or other obligations received by the Company or any such Restricted Subsidiary from suchtransferee that are converted by the Company or such Subsidiary into cash within 180 days after the date of the Asset Sale,to the extent of the cash received in that conversion; and

(C) any stock or assets of the kind referred to in Section 3.7(b)(2) or (4).

(b) Within 360 days after the receipt of any Net Proceeds from an Asset Sale, the Company or the applicable Restricted Subsidiary, asthe case may be, may apply those Net Proceeds at its option:

(1) to repay Indebtedness and other Obligations under Credit Facilities that are permitted by clause (i) of the definition of"Permitted Debt" of the Company or a Restricted Subsidiary of the Company that is a Guarantor;

(2) to acquire all or substantially all of the assets of, or any Capital Stock of, another Permitted Business (or a division or unitthereof), if, after giving effect to any such acquisition of Capital Stock, the Permitted Business is or becomes a Restricted Subsidiaryof the Company;

(3) to make a capital expenditure; or

(4) to acquire other assets that are not classified as current assets under GAAP and that are used or useful in a PermittedBusiness.

(c) Pending the final application of any Net Proceeds, the Issuers may temporarily reduce revolving credit borrowings or otherwiseinvest the Net Proceeds in any manner that is not prohibited by this Indenture.

(d) Any Net Proceeds from Asset Sales that are not applied or invested as provided in the preceding Section 3.7(b) will constitute"Excess Proceeds"; provided, that the 360-day period provided above to apply any portion of Net Proceeds in accordance withSection 3.7(b)(2) or (4) shall be extended by an additional 90 days if, by not later than the 360th day after receipt of such Net Proceeds, theCompany or a Restricted Subsidiary, as applicable, has entered into a bona fide binding contract with a Person other than an Affiliate of theCompany to make an investment of the type described in Section 3.7(b)(2) or (4) in the amount of such Net Proceeds. When the aggregateamount of Excess Proceeds exceeds $15.0 million, within ten days thereof, the Issuers will make an offer (an "Asset Sale Offer") to allHolders of Notes and all holders of other Indebtedness that ranks pari passu with the Notes containing provisions similar to



47



those set forth in this Indenture with respect to offers to purchase or redeem with the proceeds of sales of assets to purchase, on a pro ratabasis, the maximum principal amount of Notes and such other pari passu Indebtedness that may be purchased out of the Excess Proceeds. Theoffer price in any Asset Sale Offer will be equal to 100% of the principal amount plus accrued and unpaid interest and Special Interest, if any,to the date of purchase, and will be payable in cash. If any Excess Proceeds remain after consummation of an Asset Sale Offer, the Issuersmay use those Excess Proceeds for any purpose not otherwise prohibited by this Indenture. If the aggregate principal amount of Notes andother pari passu Indebtedness tendered into such Asset Sale Offer exceeds the amount of Excess Proceeds, the Trustee will select the Notes tobe purchased on a pro rata basis on the basis of the aggregate principal amount of tendered Notes. Upon completion of each Asset Sale Offer,the amount of Excess Proceeds will be reset at zero. If the Asset Sale Payment Date is on or after an interest payment record date and on orbefore the related interest payment date, any accrued and unpaid interest (including Special Interest, if any) will be paid to the Holder inwhose name a Note is registered at the close of business on such record date, and no interest or Special Interest, if any, will be payable to theHolder who tenders the Notes pursuant to the Asset Sale Offer.

(e) The Asset Sale Offer will remain open for a period of 20 Business Days following its commencement, except to the extent that alonger period is required by applicable law (the "Asset Sale Offer Period"). No later than five Business Days after the termination of the AssetSale Offer Period (the "Asset Sale Payment Date"), the Company will purchase the principal amount of Notes and other pari passuIndebtedness required to be purchased pursuant to this covenant (the "Asset Sale Offer Amount") or, if less than the Asset Sale Offer Amounthas been so validly tendered, all Notes and other pari passu Indebtedness validly tendered in response to the Asset Sale Offer. On or before theAsset Sale Payment Date, the Company will, to the extent lawful, accept for payment, on a pro rata basis to the extent necessary, the AssetSale Offer Amount of Notes and other pari passu Indebtedness or portions thereof so validly tendered and not properly withdrawn pursuant tothe Asset Sale Offer, or if less than the Asset Sale Offer Amount has been validly tendered and not properly withdrawn, all Notes and otherpari passu Indebtedness so validly tendered and not properly withdrawn. The Company will deliver to the Trustee an Officers' Certificatestating that such Notes or portions thereof were accepted for payment by the Company in accordance with the terms of this covenant; and, inaddition, the Company will make such deliveries of all certificates and notes as are required by the agreements governing the other pari passuIndebtedness. The Company or the Paying Agent, as the case may be, will promptly (but in any case not later than five Business Days after thetermination of the Asset Sale Offer Period) mail or deliver to each tendering Holder of Notes, an amount equal to the purchase price of theNotes so validly tendered and not properly withdrawn by such Holder and accepted by the Company for purchase, and the Company willpromptly issue a new Note, and the Trustee, upon receipt by the Trustee of such an Officers' Certificate from the Company, will authenticateand mail or deliver such new Note to such Holder, in a principal amount equal to any unpurchased portion of the Note surrendered. Inaddition, the Company will take any and all other actions required by the agreements governing the other pari passu Indebtedness. Any Notenot so accepted will be promptly mailed or delivered by the Company to the Holder thereof. The Company will publicly announce the resultsof the Asset Sale Offer on or as soon as practicable after the Asset Sale Payment Date.

(f) The Issuers will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulationsthereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Sale Offer.To the extent that the provisions of any securities laws or regulations conflict with the Asset Sale provisions hereunder, the Issuers willcomply with the applicable securities laws and regulations and will not be deemed to have breached their obligations under the Asset Saleprovisions hereunder by virtue of such compliance.

(g) The Trustee shall be under no obligation to ascertain the occurrence of an Asset Sale, or to determine or calculate Excess Proceeds,the Asset Sale Offer Period, the Asset Sale Payment Date or the Asset Sale Offer Amount, or give any notice with respect thereto. The Trusteemay conclusively assume, in

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the absence of written notice to the contrary from the Company or a Holder or Holders of Notes, that no Asset Sale has occurred.

Section 3.8. Transactions with Affiliates.

(a) The Company will not, and will not permit any of its Restricted Subsidiaries to, make any payment to, or sell, lease, transfer orotherwise dispose of any of its properties or assets to, or purchase any property or assets from, or enter into or make or amend any transaction,contract, agreement, understanding, loan, advance or Guarantee with, or for the benefit of, any Affiliate of the Company (each, an "AffiliateTransaction"), unless:

(1) the Affiliate Transaction is on terms that are no less favorable to the Company or the relevant Restricted Subsidiary thanthose that would have been obtained in a comparable transaction by the Company or such Restricted Subsidiary with an unrelatedPerson; and

(2) the Company delivers to the Trustee:

(A) with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregateconsideration in excess of $10.0 million, a resolution of the Board of Directors of the Company set forth in an Officers'Certificate certifying that such Affiliate Transaction complies with this covenant and that such Affiliate Transaction hasbeen approved by a majority of the disinterested members of the Board of Directors of the Company; and

(B) with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregateconsideration in excess of $25.0 million, an opinion as to the fairness to the Company or such Subsidiary of such AffiliateTransaction from a financial point of view issued by an accounting, appraisal or investment banking firm of nationalstanding.

(b) The following items will not be deemed to be Affiliate Transactions and, therefore, will not be subject to the provisions ofSection 3.8(a):

(1) any employment agreement, employee benefit plan, officer or director indemnification agreement or any similararrangement entered into by the Company or any of its Restricted Subsidiaries in the ordinary course of business and paymentspursuant thereto;

(2) transactions between or among the Company and/or any of its Restricted Subsidiaries (including Persons that becomeRestricted Subsidiaries as a result thereof);

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(3) transactions with a Person (other than an Unrestricted Subsidiary of the Company) that is an Affiliate of the Companysolely because the Company owns, directly or through a Restricted Subsidiary, an Equity Interest in, or controls, such Person;

(4) reasonable fees and expenses and compensation paid to, and indemnity provided on behalf of, officers, directors oremployees of the Company or any Restricted Subsidiaries as determined in good faith by the Board of Directors or seniormanagement of Parent;

(5) any issuance of Equity Interests (other than Disqualified Stock) of the Company to Affiliates of the Company;

(6) Restricted Payments that do not violate Section 3.4;

(7) transactions effected in connection with the transactions closing contemporaneously with the sale of the Initial Notes onthe Issue Date, including the payment of all fees and expenses, which transactions are described in the Offering Memorandum underthe caption "Arrangements between Kerr-McGee and Our Company";

(8) any transaction effected as part of a Qualified Receivables Financing;

(9) transactions between the Company or any Restricted Subsidiaries and any Person, a director of which is also a director ofthe Company or any direct or indirect parent company of the Company and such director is the sole cause for such Person to bedeemed an Affiliate of the Company or any Restricted Subsidiaries; provided, however, that such director abstains from voting asdirector of the Company or such direct or indirect parent company, as the case may be, on any matter involving such other Person;

(10) any contribution to the capital of the Company; and

(11) transactions pursuant to any contract or agreement described in the Offering Memorandum under the caption"Arrangements between Kerr-McGee and Our Company," as in effect on the Issue Date, in each case as amended, modified orreplaced from time to time so long as the amended, modified or new agreements, taken as a whole, are not materially less favorableto the Company and its Restricted Subsidiaries than those in effect on the Issue Date.

Section 3.9. Change of Control. If a Change of Control occurs, each Holder of Notes will have the right to require the Issuers torepurchase all or any part (equal to $1,000 or an integral multiple of $1,000) of that Holder's Notes at a purchase price in cash equal to 101%of the aggregate principal amount of the Notes repurchased plus accrued and unpaid interest and Special Interest, if any, on the Notesrepurchased to the date of purchase (subject to the right of Holders of Notes on the relevant record date to receive interest due on the relevantinterest payment date).

Within 30 days following any Change of Control, the Issuers will mail a notice (the "Change of Control Offer") to each Holder with acopy to the Trustee stating:

(1) that a Change of Control has occurred and that such Holder has the right to require the Company to purchase such Holder'sNotes at a purchase price in cash equal to 101% of the principal amount of such Notes plus accrued and unpaid interest and SpecialInterest, if any, to the date of settlement (the "Change of Control Payment Date") (subject to the right of Holders of record on arecord date to receive interest on the relevant interest payment date that is on or prior to the Change of Control Settlement Date) (the"Change of Control Payment");

(2) the purchase date (which shall be no earlier than 30 days nor later than 60 days from the date such notice is mailed) (the"Change of Control Purchase Date"); and

(3) the procedures determined by the Company, consistent with this Indenture, that a Holder must follow in order to have itsNotes purchased.

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On the Change of Control Payment Date, the Issuers will, to the extent lawful, accept for payment all Notes or portions of Notes (equal to$1,000 or an integral multiple of $1,000) properly tendered pursuant to the Change of Control Offer. Promptly thereafter on the Change ofControl Settlement Date, the Company will:

(1) deposit with the Paying Agent an amount equal to the Change of Control Payment in respect of all Notes or portions ofNotes properly tendered; and

(2) deliver or cause to be delivered to the Trustee the Notes properly accepted together with an Officers' Certificate stating theaggregate principal amount of Notes or portions of Notes being purchased by the Issuers.

On the Change of Control Payment Date, if the Company has properly complied with the requirements of items (1) and (2) immediatelyabove, the Paying Agent will remit to each Holder of Notes properly tendered the Change of Control Payment for such Notes, and the Trusteewill, upon receipt of a Company Order, authenticate and deliver to each Holder a new Note equal in principal amount to any unpurchasedportion of the Notes surrendered, if any; provided that each such new Note will be in a principal amount of $1,000 or an integral multiple of$1,000. The Issuers will publicly announce the results of the Change of Control Offer on or as soon as practicable after the Change of ControlPayment Date.

If the Change of Control Payment Date is on or after an interest record date and on or before the related interest payment date, anyaccrued and unpaid interest and Special Interest, if any, will be paid to the Person in whose name a Note is registered at the close of businesson such record date, and no Special Interest will be payable to Holders who tender pursuant to the Change of Control Offer.

The Issuers will not be required to make a Change of Control Offer upon a Change of Control if (1) a third party makes the Change ofControl Offer in the manner, at the time and otherwise in compliance with the requirements set forth in this Indenture applicable to a Changeof Control Offer made by the Issuers and purchases all Notes validly tendered and not withdrawn under such Change of Control Offer, or (2) anotice of redemption has been given pursuant to Section 5.1, unless and until there has been a default in payment of the applicable redemptionprice.

The Company will comply, to the extent applicable, with the requirements of Rule 14e-1 of the Exchange Act and any other securitieslaws or regulations in connection with the repurchase of Notes pursuant to this Section 3.9. To the extent that the provisions of any securitieslaws or regulations conflict with provisions of this Indenture, the Issuers will comply with the applicable securities laws and regulations andwill not be deemed to have breached their obligations described in this Indenture by virtue of such compliance.

The Trustee shall be under no obligation to ascertain the occurrence of a Change of Control or to give notice with respect thereto. TheTrustee may conclusively assume, in the absence of written notice to the contrary from the Company, or a Holder or Holders of Notes, that noChange of Control has occurred.

Section 3.10. Future Note Guarantees.

(a) If the Company or any of its Restricted Subsidiaries acquires or creates another wholly-owned Domestic Subsidiary after the IssueDate, then that newly acquired or created wholly-owned Domestic Subsidiary will become a Guarantor by executing a supplemental indenturesubstantially in the form of Exhibit C hereto and delivering it and an Opinion of Counsel to the Trustee within 10 Business Days of the date onwhich it was acquired or created, as the case may be; provided, however, that the foregoing shall not apply to Subsidiaries of the Companythat have properly been designated as Unrestricted Subsidiaries in accordance with this Indenture for so long as they continue to constituteUnrestricted Subsidiaries; and provided, further, that any wholly-owned Domestic Subsidiary that constitutes an Immaterial Subsidiary neednot become a Guarantor until such time as it ceases to be an Immaterial Subsidiary.

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(b) Except with respect to Permitted Debt, the Issuers will not permit any of their Restricted Subsidiaries, directly or indirectly, toGuarantee or pledge any assets to secure the payment of any other Indebtedness of the Issuers unless such Restricted Subsidiarysimultaneously executes and delivers a supplemental indenture substantially in the form of Exhibit C hereto providing for the Guarantee of thepayment of the Notes by such Restricted Subsidiary and/or the pledging of such assets on the same basis, as the case may be, which Guaranteewill be senior to or pari passu with such Restricted Subsidiary's Guarantee of or pledge to secure such other Indebtedness.

Section 3.11. Sale and Leaseback Transactions. The Company will not, and will not permit any of its Restricted Subsidiaries to, enterinto any sale and leaseback transaction; provided that the Company or any Guarantor may enter into a sale and leaseback transaction if:

(a) the Company or that Guarantor, as applicable, could have (i) incurred Indebtedness in an amount equal to the Attributable Debtrelating to such sale and leaseback transaction under the Fixed Charge Coverage Ratio test in Section 3.3(a) and (ii) incurred a Lien to securesuch Indebtedness pursuant to Section 3.5;

(2) the gross cash proceeds of that sale and leaseback transaction are at least equal to the Fair Market Value, as determined ingood faith by the Board of Directors of the Company and set forth in an Officers' Certificate delivered to the Trustee, of the propertythat is the subject of that sale and leaseback transaction; and

(3) the transfer of assets in that sale and leaseback transaction is permitted by, and the Company applies the proceeds of suchtransaction in compliance with, Section 3.7.

Section 3.12. Business Activities. The Company will not, and will not permit any Restricted Subsidiary to, engage in any businessother than Permitted Businesses, except to such extent as would not be material to the Company and its Restricted Subsidiaries taken as awhole.

Section 3.13. Designation of Restricted and Unrestricted Subsidiaries. The Board of Directors of the Company may designate anyRestricted Subsidiary of the Company (other than Tronox Finance so long as the Company is a limited liability company or a partnership) tobe an Unrestricted Subsidiary if that designation would not cause a Default. If a Restricted Subsidiary is designated as an UnrestrictedSubsidiary, the aggregate Fair Market Value of all outstanding Investments owned by the Company and its Restricted Subsidiaries in theSubsidiary designated as Unrestricted will be deemed to be an Investment made as of the time of the designation and will reduce the amountavailable for Restricted Payments under the first paragraph of Section 3.4(a) or represent Permitted Investments, as determined by theCompany. That designation will only be permitted if the Investment would be permitted at that time and if the Restricted Subsidiary otherwisemeets the definition of an Unrestricted Subsidiary.

The Board of Directors of the Company may redesignate any Unrestricted Subsidiary to be a Restricted Subsidiary if that redesignationwould not cause a Default. Any designation of a Subsidiary of the Company as an Unrestricted Subsidiary will be evidenced to the Trustee byfiling with the Trustee a Board Resolution of the Company giving effect to such designation and an Officers' Certificate certifying that suchdesignation complied with the preceding conditions and was permitted by Section 3.4. If, at any time, any Unrestricted Subsidiary would failto meet the preceding requirements as an Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of thisIndenture and any Indebtedness of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Company as of such dateand, if such Indebtedness is not permitted to be incurred as of such date under Section 3.3, the Company will be in default thereof.

Section 3.14. Maintenance of Office or Agency. The Issuers will maintain in The City of New York, an office or agency where theNotes may be presented or surrendered for payment, where, if applicable, the Notes may be surrendered for registration of transfer orexchange and where notices and demands to or upon the Company in respect of the Notes and this Indenture may be served. The principalcorporate

52



trust office of the Trustee, or if the Trustee's principal corporate trust office is not located in The City of New York, any other office or agencymaintained by the Trustee in The City of New York (the "Corporate Trust Office"), shall be such office or agency of the Issuers, unless theIssuers shall designate and maintain some other office or agency for one or more of such purposes. The Issuers will give prompt written noticeto the Trustee of any change in the location of any such office or agency. If at any time the Issuers shall fail to maintain any such requiredoffice or agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be madeor served at the Corporate Trust Office of the Trustee, and the Issuers hereby appoint the Trustee as its agent to receive all such presentations,surrenders, notices and demands.

The Issuers may also from time to time designate one or more other offices or agencies (in or outside of The City of New York) wherethe Notes may be presented or surrendered for any or all such purposes and may from time to time rescind any such designation; provided,however, that no such designation or rescission shall in any manner relieve the Issuers of their obligation to maintain an office or agency inThe City of New York for such purposes. The Issuers will give prompt written notice to the Trustee of any such designation or rescission andany change in the location of any such other office or agency.

Section 3.15. Corporate Existence. Subject to Article IV and Section 10.2, each Issuer will do or cause to be done all things necessaryto preserve and keep in full force and effect its corporate existence and that of each of their Restricted Subsidiaries and the corporate rights(charter and statutory) licenses and franchises of the Issuers and each of their Restricted Subsidiaries; provided, however, that the Issuers shallnot be required to preserve any such existence (except the Company), right, license or franchise if the Board of Directors of the Company shalldetermine that the preservation thereof is no longer desirable in the conduct of the business of the Issuers and each of their RestrictedSubsidiaries, taken as a whole, and that the loss thereof would not have a material adverse effect on the ability of the Issuers to perform theirobligations under the Notes or this Indenture, provided further that the Company and the Guarantors may merge in accordance with Sections4.1 and 10.2.

Section 3.16. Payment of Taxes and Other Claims. The Issuers will pay or discharge or cause to be paid or discharged, before thesame shall become delinquent, (i) all material taxes, assessments and governmental charges levied or imposed upon the Issuers or anyRestricted Subsidiary or upon the income, profits or property of the Issuers or any Restricted Subsidiary and (ii) all lawful claims for labor,materials and supplies, which, if unpaid, might by law become a material liability or lien upon the property of the Issuers or any RestrictedSubsidiary, except for any Lien permitted to be incurred pursuant to subsections (7) and (10) of the definition of "Permitted Liens"; provided,however, that the Issuers shall not be required to pay or discharge or cause to be paid or discharged any such tax, assessment, charge or claimwhose amount, applicability or validity is being contested in good faith by appropriate proceedings and for which appropriate reserves, ifnecessary (in the good faith judgment of management of the Issuers), are being maintained in accordance with GAAP or where the failure topay or discharge the same would not have a material adverse effect on the ability of the Issuers to perform its obligations under the Notes orthis Indenture.

Section 3.17. Compliance Certificate. The Issuers shall deliver to the Trustee within 120 days after the end of each fiscal year of theIssuers an Officers' Certificate stating that in the course of the performance by the signers of their duties as Officers of the Issuers they wouldnormally have knowledge of any Default or Event of Default and whether or not the signers know of any Default or Event of Default thatoccurred during such period. If they do, the certificate shall describe the Default or Event of Default, its status and what action the Issuers areis taking or proposes to take with respect thereto. The Issuers also shall comply with TIA § 314(a)(4).

Section 3.18. Further Instruments and Acts. Upon the reasonable request of the Trustee, the Issuers will execute and deliver suchfurther instruments and do such further acts as may be reasonably necessary or proper to carry out more effectively the purpose of thisIndenture.

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Section 3.19. Statement by Officers as to Default. The Issuers shall deliver to the Trustee, as soon as possible and in any event within5 Business Days after any Issuer becomes aware of the occurrence of any Event of Default or Default an Officers' Certificate setting forth thedetails of such Event of Default or Default and the action which the Issuers are taking or proposes to take in respect thereof.

Section 3.20. Payments for Consent. The Company will not, and will not permit any of its Restricted Subsidiaries to, directly orindirectly, pay or cause to be paid any consideration to or for the benefit of any Holder of Notes for or as an inducement to any consent,waiver or amendment of any terms or provisions of this Indenture or the Notes, unless such consideration is offered to be paid and is paid toall Holders of the Notes which so consent, waive or agree to amend in the time frame set forth in solicitation documents relating to suchconsent, waiver or agreement.

Section 3.21. Restrictions on Activities of Tronox Finance. Tronox Finance will not hold any material assets, become liable for anymaterial obligations, other than the Notes and guarantee obligations under the Credit Agreement, or engage in any significant businessactivities; provided that Tronox Finance may be a co-obligor with respect to Indebtedness if the Company is the primary obligor of suchIndebtedness and the net proceeds of such Indebtedness are received by the Company or one or more of the Company's Restricted Subsidiariesother than Tronox Finance. At any time after the Company is a corporation, Tronox Finance may consolidate or merge with or into theCompany or any Restricted Subsidiary.

Section 3.22. Elimination of Covenants. From and after the first day following a period of 90 consecutive days during which theNotes have an Investment Grade Rating from both Rating Agencies and no Default has occurred and is then continuing under this Indenture,Parent, the Issuers and all of their Restricted Subsidiaries will no longer be subject to the provisions of Section 3.3, 3.4, 3.6, 3.7, 3.8, 3.9,3.11(a)(i), 3.11(c), 3.13, and 4.1(4) (collectively, the "Eliminated Covenants").

ARTICLE IV

Successor Company

Section 4.1. Merger, Consolidation or Sale of Assets. Neither Issuer will, directly or indirectly: (a) consolidate or merge with or intoanother Person (whether or not such Issuer is the surviving corporation); or (b) sell, assign, transfer, convey or otherwise dispose of all orsubstantially all of its respective properties or assets taken as a whole, in one or more related transactions, to another Person, unless:

(1) either: (a) such Issuer is the surviving entity; or (b) the Person (the "Successor Company") formed by or surviving anysuch consolidation or merger (if other than such Issuer) or to which such sale, assignment, transfer, conveyance or other dispositionhas been made is a corporation, partnership, trust or limited liability company organized or existing under the laws of the UnitedStates, any state of the United States or the District of Columbia; provided, that Tronox Finance may not consolidate or merge withor into any entity other than a corporation satisfying such requirements for so long as the Company remains a limited liabilitycompany or a partnership;

(2) the Person formed by or surviving any such consolidation or merger (if other than such Issuer) or the Person to which suchsale, assignment, transfer, conveyance or other disposition has been made assumes all the obligations of such Issuer under the Notes,this Indenture and the Registration Rights Agreement;

(3) immediately after such transaction, no Default or Event of Default exists;

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(4) such Issuer or the Successor Company (if other than such Issuer), or to which such sale, assignment, transfer, conveyanceor other disposition has been made:

(A) would have Consolidated Net Worth immediately after the transaction equal to or greater than the ConsolidatedNet Worth of such Issuer immediately preceding the transaction; or

(B) would, on the date of such transaction after giving pro forma effect thereto and any related financing transactionsas if the same had occurred at the beginning of the applicable four-quarter period, be permitted to incur at least $1.00 ofadditional Indebtedness under Section 3.3; or

(C) would, on the date of such transaction after giving pro forma effect thereto and to any related financingtransactions as if the same had occurred at the beginning of the most recently ended four fiscal quarters for which internalfinancial statements are available, have a Fixed Charge Coverage Ratio that is not less than the Fixed Charge CoverageRatio of the Company for such period calculated without giving pro forma effect to such transaction and any relatedfinancing transactions; and

(5) the Company shall have delivered to the Trustee an Officers' Certificate and an Opinion of Counsel, each stating that suchconsolidation, merger or disposition and such supplemental indenture (if any) comply with the applicable provision of thisIndenture.

In addition, such Issuer will not, directly or indirectly, lease all or substantially all of the properties and assets of it and its RestrictedSubsidiaries taken as a whole, in one or more related transactions, to any other Person.

For purposes of this covenant, the sale, lease, conveyance, assignment, transfer, or other disposition of all or substantially all of theproperties and assets of one or more Subsidiaries of the Company, which properties and assets, if held by the Company instead of suchSubsidiaries, would constitute all or substantially all of the properties and assets of the Company on a consolidated basis, shall be deemed tobe the transfer of all or substantially all of the assets of the Company.

The Successor Company will succeed to, and be substituted for, and may exercise every right and power of, the particular Issuer underthis Indenture, but, in the case of a lease of all or substantially all its assets, the particular Issuer will not be released from the obligation to paythe principal of and interest on the Notes.

Notwithstanding the foregoing, (x) any Restricted Subsidiary of the Company may consolidate with, merge into or transfer all or part ofits properties and assets to the Company or any Guarantor, (y) any Issuer may merge with an Affiliate solely for the purpose ofreincorporating such Issuer in another jurisdiction and (z) the Company may reorganize as a corporation in accordance with the proceduresestablished in this Indenture, provided that (i) the corporation is organized and existing under the laws of the United States, any state thereofor the District of Columbia, (ii) the corporation assumes all of the Company's obligations under the Notes and this Indenture and (iii) theCompany delivers to the Trustee an Opinion of Counsel confirming that the Holders of the outstanding Notes will not recognize income, gainor loss for federal income tax purposes as a result of such reorganization.

ARTICLE V

Redemption of Notes

Section 5.1. Optional Redemption. Except as described below, the Notes will not be redeemable by the Company's option priorto , 2009.

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(a) On or after , 2009 the Issuers may redeem all or any part of the Notes upon not less than 30 nor more than 60 days' notice, atthe redemption prices (expressed as percentages of principal amount) set forth below, plus accrued and unpaid interest and Special Interest, ifany, on the Notes redeemed to the applicable Redemption Date (subject to the right of Holders of record on the relevant record date to receiveinterest due on an interest payment date that is on or prior to the Redemption Date), if redeemed during the twelve-month period beginningon of the years indicated below:

Year Percentage

2009 %2010 %2011 and thereafter 100.000%

(b) At any time prior to , 2008, the Issuers may on any one or more occasions redeem up to 35% of the aggregateprincipal amount of Notes issued hereunder (calculated after giving effect to any issuance of Additional Notes) at a redemption priceof % of the principal amount, plus accrued and unpaid interest and Special Interest, if any, to the Redemption Date (subject tothe right of Holders of record on the relevant record date to receive interest due on an interest payment date that is on or prior to theRedemption Date), with the net cash proceeds of one or more Equity Offerings, provided that:

(1) at least 65% of the aggregate principal amount of Notes (calculated after giving effect to any issuance ofAdditional Notes) issued hereunder remains outstanding immediately after the occurrence of such redemption (excludingNotes held by Parent, any Issuer and their Subsidiaries); and

(2) the redemption occurs within 90 days of the date of the closing of such Equity Offering.

Section 5.2. Applicability of Article. Redemption of Notes at the election of the Issuers or otherwise, as permitted or required by anyprovision of this Indenture, shall be made in accordance with such provision and this Article V.

Section 5.3. Election to Redeem; Notice to Trustee. The election of the Issuers to redeem any Notes pursuant to Section 5.1 shall beevidenced by a Board Resolution. In case of any redemption at the election of the Issuers, the Issuers shall, upon not later than the earlier ofthe date that is 45 days prior to the Redemption Date fixed by the Issuers or the date on which notice is given to the Holders (unless a shorternotice shall be satisfactory to the Trustee), notify the Trustee of such Redemption Date and of the principal amount of Notes to be redeemedand shall deliver to the Trustee such documentation and records as shall enable the Trustee to select the Notes to be redeemed pursuant toSection 5.4.

Section 5.4. Selection by Trustee of Notes to Be Redeemed. If fewer than all of the Notes are to be redeemed at any time, the Trusteewill select Notes for redemption as follows:

(1) if the Notes are listed on any national securities exchange, in compliance with the requirements of the principal nationalsecurities exchange on which the Notes are listed; or

(2) if the Notes are not listed on any national securities exchange, on a pro rata basis.

Section 5.5. Notice of Redemption. Notice of redemption shall be given in the manner provided for in Section 12.2 not less than 30nor more than 60 days prior to the Redemption Date, to each Holder of Notes to be redeemed, except that redemption notices may be mailedmore than 60 days prior to a Redemption Date if such notice is issued in connection with a defeasance of the Notes or a satisfaction anddischarge of this Indenture. Notices of any redemption upon any Equity Offering may be given prior to the completion of the related EquityOffering. Except for notices of redemption pursuant to Section 5.1, which redemption notices may, at the Company's discretion, be subject tothe satisfaction of one or more conditions precedent, notices of redemption may not be conditional. The Trustee shall give notice ofredemption in the Issuers' names and at the Issuers' expense; provided, however, that the Issuers shall deliver to the Trustee, at least 45 daysprior to the Redemption Date (unless a shorter notice shall be satisfactory to the Trustee), an Officers' Certificate requesting that the Trusteegive such notice at the Issuers' expense and setting forth the information to be stated in such notice as provided in the following items.



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All notices of redemption shall state:

(1) the Redemption Date;

(2) the redemption price and the amount of accrued interest and Special Interest, if any, to the Redemption Date payable asprovided in Section 5.7;

(3) if less than all outstanding Notes are to be redeemed, the identification of the particular Notes (or portion thereof) to beredeemed, as well as the aggregate principal amount of Notes to be redeemed and the aggregate principal amount of Notes to beoutstanding after such partial redemption;

(4) in case any Note is to be redeemed in part only, the notice which relates to such Note shall state the portion of the principalamount of that Note that is to be redeemed and that on and after the Redemption Date, upon surrender of such Note, the Holder willreceive, without charge, a new Note or Notes of authorized denominations for the principal amount thereof remaining unredeemed;

(5) in case any Note is to be redeemed pursuant to Section 5.1, and such redemption is subject to conditions precedent, theconditions precedent to such optional redemption, if any;

(6) that on the Redemption Date the redemption price (and accrued interest, if any, to the Redemption Date payable asprovided in Section 5.7) will become due and payable upon each such Note, or the portion thereof, to be redeemed, and, unless theIssuers default in making the redemption payment, that interest and Special Interest, if any, on Notes (or the portions thereof) calledfor redemption will cease to accrue on and after said date;

(7) the place or places where such Notes are to be surrendered for payment of the Redemption Price and accrued interest, ifany;

(8) the name and address of the Paying Agent;

(9) that Notes called for redemption (other than a Global Note) must be surrendered to the Paying Agent to collect theredemption price;

(10) the CUSIP number, and that no representation is made as to the accuracy or correctness of the CUSIP number, if any,listed in such notice or printed on the Notes; and

(11) the section of this Indenture and the paragraph of the Notes pursuant to which the Notes are to be redeemed.

Section 5.6. Deposit of Redemption Price. Not later than 11:00 a.m. New York time on the Redemption Date, the Issuers shall depositwith the Trustee or with a Paying Agent (or, if the Company is acting as its own Paying Agent, segregate and hold in trust as provided inSection 2.4) an amount of money sufficient to pay the redemption price of, and accrued interest and Special Interest, if any, on, all the Noteswhich are to be redeemed on that date.

Section 5.7. Notes Payable on Redemption Date. Notice of redemption having been given as aforesaid, the Notes so to be redeemedshall, on the Redemption Date, become due and payable at the redemption price therein specified (together with accrued and unpaid interestand Special Interest, if any, to the Redemption Date), and from and after such date (unless the Issuers shall default in the payment of theredemption price and accrued interest and Special Interest, if any) such Notes shall cease to bear interest and Special Interest, if any. Uponsurrender of any such Note for redemption in accordance with said notice, such Note shall be paid by the Issuers at the redemption price,together with accrued and unpaid interest and Special Interest, if any, to the Redemption Date (subject to the rights of Holders of record on therelevant record date to receive interest and Special Interest, if any, due on an interest payment date that is on or prior to the Redemption Date).

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If any Note called for redemption shall not be so paid upon surrender thereof for redemption, the principal (and premium, if any) shall,until paid, bear interest and Special Interest, if any, from the Redemption Date at the rate borne by the Notes.

Section 5.8. Notes Redeemed in Part. Any Note which is to be redeemed only in part (pursuant to the provisions of this Article V)shall be surrendered at the office or agency of the Issuers maintained for such purpose pursuant to Section 3.14 (with, if the Issuers or theTrustee so require, due endorsement by, or a written instrument of transfer in form satisfactory to the Issuers and the Trustee duly executed by,the Holder thereof or such Holder's attorney duly authorized in writing), and the Issuers shall execute, and the Trustee shall authenticate andmake available for delivery to the Holder of such Note at the expense of the Issuers, a new Note or Notes, of any authorized denomination asrequested by such Holder, in an aggregate principal amount equal to and in exchange for the unredeemed portion of the principal of the Noteso surrendered, provided that each such new Note will be in a principal amount of $1,000 or integral multiple thereof. No Notes of $1,000 orless may be redeemed in part.

ARTICLE VI

Defaults and Remedies

Section 6.1. Events of Default. Each of the following is an "Event of Default":

(1) default in the payment when due of interest or Special Interest, if any, on the Notes continues for a period of 30 days;

(2) default in the payment when due (at maturity, upon redemption or otherwise) of principal of or premium, if any, on the Notes;

(3) failure by the Company or any of its Restricted Subsidiaries to comply with the provisions of Sections 3.7, 3.9 or 4.1 hereof;

(4) failure by the Company or any of its Restricted Subsidiaries for 60 days after notice to the Company to comply with any of the otheragreements in this Indenture not specified in clauses (1) through (3) above;

(5) default under any mortgage, indenture or instrument under which there may be issued or by which there may be secured orevidenced any Indebtedness for money borrowed by the Company or any of its Restricted Subsidiaries (or the payment of which is Guaranteedby the Company or any of its Restricted Subsidiaries), whether such Indebtedness or Guarantee now exists, or is created after the Issue Date, ifthat default:

(a) is caused by a failure to pay principal of, or interest or premium, if any, on, such Indebtedness prior to the expiration of thegrace period provided in such Indebtedness on the date of such default (a "Payment Default"); or

(b) results in the acceleration of such Indebtedness prior to its Stated Maturity,

and, in each case, the principal amount of any such Indebtedness, together with the principal amount of any other such Indebtedness underwhich there has been a Payment Default or the maturity of which has been so accelerated, aggregates $25.0 million or more;

(6) failure by an Issuer or any of the Company's Restricted Subsidiaries to pay final judgments entered by a court or courts of competentjurisdiction aggregating in excess of $5.0 million (net of any amount with respect to which a reputable and solvent insurance company hasacknowledged liability in writing), which judgments are not paid, discharged or stayed for a period of 60 days;

(7) except as permitted by this Indenture, any Note Guarantee is held in any judicial proceeding to be unenforceable or invalid or ceasesfor any reason to be in full force and effect, or any Guarantor, or any

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Person acting on behalf of any Guarantor, denies or disaffirms its obligations under its Note Guarantee; and

(8) (a) the Company or any Restricted Subsidiary or group of Restricted Subsidiaries that, taken together (as of the latest auditedconsolidated financial statements for the Company and its Restricted Subsidiaries), would constitute a Significant Subsidiary pursuant to orwithin the meaning of any Bankruptcy Law:

(i) commences a voluntary case or proceeding;

(ii) consents to the entry of a judgment, decree or order for relief against it in an involuntary case or proceeding;

(iii) consents to the appointment of a Custodian of it or for any substantial part of its property;

(iv) makes a general assignment for the benefit of its creditors; or

(v) consents to or acquiesces in the institution of a bankruptcy or an insolvency proceeding against it;

or takes any comparable action under any foreign laws relating to insolvency; or

(b) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:

(i) is for relief against the Company or any Restricted Subsidiary or group of Restricted Subsidiaries that, taken together (as of thelatest audited consolidated financial statements for the Company and its Restricted Subsidiaries), would constitute aSignificant Subsidiary in an involuntary case;

(ii) appoints a Custodian of the Company or any Restricted Subsidiary or group of Restricted Subsidiaries that, taken together (asof the latest audited consolidated financial statements for the Company and its Restricted Subsidiaries), would constitute aSignificant Subsidiary or for any substantial part of its Property; or

(iii) orders the winding up or liquidation of the Company or any Restricted Subsidiary or group of Restricted Subsidiaries that,taken together (as of the latest audited consolidated financial statements for the Company and its Restricted Subsidiaries)would constitute a Significant Subsidiary;

or any similar relief is granted under any foreign laws and the order, decree or relief remains unstayed and in effect for60 days.

However, a Default under clause (4) of this Section 6.1 will not constitute an Event of Default until the Trustee or the Holders of 25% inaggregate principal amount of the outstanding Notes notify the Company, and the Trustee in the case of a notice given by the Holders, of theDefault and the Company does not cure such Default within the time specified in clause (5) of this Section 6.1 after receipt of such notice.

Section 6.2. Acceleration. If any Event of Default (other than those of the type described in clause (8) of Section 6.1) occurs and iscontinuing, the Trustee may and, at the direction of the Holders of at least 25% in aggregate principal amount of the then outstanding Notes,shall declare the principal of all the Notes, together with all accrued and unpaid interest and Special Interest, if any, and premium, if any, to be



due and payable immediately by notice in writing to the Issuers and, in case of a notice by Holders, also to the Trustee specifying therespective Event of Default and that such notice is a notice of acceleration, and the same shall become immediately due and payable.

In the case of an Event of Default specified in clause (8) of Section 6.1, all outstanding Notes shall become due and payable immediatelywithout further action or notice by the Trustee or the Holders. Holders may not enforce this Indenture or the Notes except as provided in thisIndenture.

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At any time after a declaration of acceleration with respect to the Notes, the Holders of a majority in principal amount of the Notes thenoutstanding (by notice to the Trustee) may, on behalf of the Holders of all of the Notes, rescind and cancel such declaration and itsconsequences if:

(1) the rescission would not conflict with any judgment or decree of a court of competent jurisdiction;

(2) all existing Defaults and Events of Default have been cured or waived except nonpayment of principal of or interest or premium orSpecial Interest, if any, on the Notes that has become due solely by reason of such declaration of acceleration;

(3) to the extent the payment of such interest is lawful, interest (at the same rate specified in the Notes) on overdue installments ofinterest and Special Interest, if any, and overdue payments of principal which has become due otherwise than by such declaration ofacceleration has been paid;

(4) the Company has paid the Trustee its reasonable compensation and reimbursed the Trustee for its reasonable expenses,disbursements and advances; and

(5) in the event of the cure or waiver of an Event of Default of the type described in clause (8) of Section 6.1, the Trustee has receivedan Officers' Certificate and Opinion of Counsel that such Event of Default has been cured or waived.

Notwithstanding the foregoing, if an Event of Default listed in clause (5) of Section 6.1 shall have occurred and been continuing, suchEvent of Default and any consequential acceleration shall be automatically rescinded if (i) the Indebtedness that is the subject of such Event ofDefault has been repaid or (ii) if the default relating to such Indebtedness is waived or cured and if such Indebtedness has been accelerated,then the holders thereof have rescinded their declaration of acceleration in respect of such Indebtedness.

Section 6.3. Other Remedies. If an Event of Default occurs and is continuing, the Trustee may pursue any available remedy to collectthe payment of principal of (or premium, if any) or interest or Special Interest, if any, on the Notes or to enforce the performance of anyprovision of the Notes or this Indenture.

The Trustee may maintain a proceeding even if it does not possess any of the Notes or does not produce any of them in the proceeding. Adelay or omission by the Trustee or any Holder in exercising any right or remedy accruing upon an Event of Default shall not impair the rightor remedy or constitute a waiver of or acquiescence in the Event of Default. No remedy is exclusive of any other remedy. All availableremedies are cumulative.

Section 6.4. Waiver of Past Defaults. The Holders of a majority in principal amount of the then outstanding Notes by notice to theTrustee may, on behalf of the Holders of all the Notes, (a) waive, by their consent (including consents obtained in connection with a purchaseof, or tender offer or exchange offer for, Notes), an existing Default or Event of Default and its consequences or compliance with anyprovisions except (i) a Default or Event of Default in the payment of the principal of, or premium, if any, or interest or Special Interest, if any,on a Note or (ii) a Default or Event of Default in respect of a provision that under Section 9.2 cannot be amended without the consent of eachHolder affected and (b) rescind any such acceleration with respect to the Notes and its consequences if rescission would not conflict with anyjudgment or decree of a court of competent jurisdiction. When a Default or Event of Default is waived, it is deemed cured, but no such waivershall extend to any subsequent or other Default or Event of Default or impair any consequent right.

Section 6.5. Control by Majority. The Holders of a majority in principal amount of the outstanding Notes may direct the time, methodand place of conducting any proceeding for any remedy available to the Trustee or of exercising any trust or power conferred on the Trustee.However, the Trustee may refuse to follow any direction that conflicts with law or this Indenture or, subject to Sections 7.1 and 7.2, that the

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Trustee determines is unduly prejudicial to the rights of the other Holders or would involve the Trustee in personal liability. Prior to takingany action hereunder, the Trustee shall be entitled to indemnification satisfactory to it in its sole discretion against all losses and expensescaused by taking or not taking such action.

Section 6.6. Limitation on Suits. Subject to Section 6.7, a Holder may not pursue any remedy with respect to this Indenture or theNotes unless:

(1) such Holder has previously given to the Trustee notice that an Event of Default is continuing;

(2) Holders of at least 25% in aggregate principal amount of the then outstanding Notes have requested that the Trustee pursue theremedy;

(3) such Holders have offered to the Trustee security or indemnity satisfactory to it against any loss, liability or expense;

(4) the Trustee has not complied with such request within 60 days after receipt of the request and the offer of security or indemnity; and

(5) the Holders of a majority in aggregate principal amount of the then outstanding Notes have not given the Trustee a direction that isinconsistent with such request within such 60-day period.

A Holder may not use this Indenture to prejudice the rights of another Holder or to obtain a preference or priority over another Holder.

Section 6.7. Rights of Holders to Receive Payment. Notwithstanding any other provision of this Indenture (including Section 6.6), theright of any Holder to receive payment of principal of, premium (if any) or interest or Special Interest, if any, when due on the Notes held bysuch Holder, on or after the respective due dates expressed in the Notes, or to bring suit for the enforcement of any such payment on or aftersuch respective dates, shall not be impaired or affected without the consent of such Holder.

Section 6.8. Collection Suit by Trustee. If an Event of Default specified in clauses (1) or (2) of Section 6.1 occurs and is continuing,the Trustee may recover judgment in its own name and as trustee of an express trust against the Issuers for the whole amount then due andowing (together with interest on any unpaid interest to the extent lawful) and the amounts provided for in Section 7.7.

Section 6.9. Trustee May File Proofs of Claim. The Trustee may file such proofs of claim and other papers or documents as may benecessary or advisable in order to have the claims of the Trustee and the Holders allowed in any judicial proceedings relative to Parent, theIssuers, their Subsidiaries or its or their respective creditors or properties and, unless prohibited by law or applicable regulations, may vote onbehalf of the Holders in any election of a trustee in bankruptcy or other Person performing similar functions, and any Custodian in any suchjudicial proceeding is hereby authorized by each Holder to make payments to the Trustee and, in the event that the Trustee shall consent to themaking of such payments directly to the Holders, to pay to the Trustee any amount due it for the reasonable compensation, expenses,disbursements and advances of the Trustee, its agents and its counsel, and any other amounts due the Trustee under Section 7.7. To the extentthat the payment of any such compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any otheramounts due the Trustee under Section 7.7 hereof out of the estate in any such proceeding, shall be denied for any reason, payment of thesame shall be secured by a Lien on, and shall be paid out of, any and all distributions, dividends, money, securities and other properties thatthe Holders may be entitled to receive in such proceeding whether in liquidation or under any plan of reorganization or arrangement orotherwise. Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept on behalf of any Holder anyplan of reorganization, arrangement, adjustment or composition affecting the Notes or the rights of any Holder, or to authorize the Trustee tovote in respect of the claim of any Holder in any such proceeding.

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Section 6.10. Priorities. If the Trustee collects any money or property pursuant to this Article VI, it shall pay out the money orproperty in the following order:

FIRST: to the Trustee for amounts due under Section 7.7;

SECOND: to Holders for amounts due and unpaid on the Notes for principal, premium, if any, and interest and Special Interest, if any,ratably, without preference or priority of any kind, according to the amounts due and payable on the Notes for principal, premium, if any, andinterest and Special Interest, if any, respectively; and

THIRD: to the Issuers or the Guarantors or to such other party as a court of competent jurisdiction may direct.

The Trustee may fix a record date and payment date for any payment to Holders pursuant to this Section 6.10. At least 15 days beforesuch record date, the Company shall mail to each Holder and the Trustee a notice that states the record date, the payment date and amount tobe paid.

Section 6.11. Undertaking for Costs. In any suit for the enforcement of any right or remedy under this Indenture or in any suit againstthe Trustee for any action taken or omitted by it as Trustee, a court in its discretion may require the filing by any party litigant in the suit of anundertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys' fees, againstany party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant. ThisSection 6.11 does not apply to a suit by the Trustee, a suit by the Issuers, a suit by a Holder pursuant to Section 6.7 or a suit by Holders ofmore than 10% in outstanding principal amount of the Notes.

Section 6.12. Additional Payments. In the case of any Event of Default occurring by reason of any willful action (or inaction) taken(or not taken) by or on behalf of the Issuers with the intention of avoiding payment of the premium that the Issuers would have had to pay ifthe Issuers then had elected to redeem the Notes on or after , 2009 pursuant to the optional redemption provisions of this Indenture, anequivalent premium shall also become and be immediately due and payable to the extent permitted by law upon the acceleration of the Notes.If an Event of Default occurs prior to , 2009 by reason of any willful action (or inaction) taken (or not taken) by or on behalf of theIssuers with the intention of avoiding the prohibition on redemption of the Notes prior to such date, then the premium specified in thisIndenture with the respect to the first year that the Notes may be redeemed at the Issuers' option (other than with the net cash proceeds of anEquity Offering) shall also become immediately due and payable to the extent permitted by law upon the acceleration of the Notes.

Section 6.13. Waiver of Stay, Extension and Usury Laws. Each of the Issuers and the Guarantors covenant (to the extent permitted byapplicable law) that it will not at any time insist upon, plead or in any manner whatsoever claim or take the benefit or advantage of, any stay,extension or usury law or other law wherever enacted, now or at any time hereafter in force, which would prohibit or forgive the Issuers or anyGuarantor from paying all of any portion of the principal of (premium, if any, on) or interest and Special Interest, if any, on the Notes ascontemplated herein, or which may affect the covenants or the performance of this Indenture; and (to the extent that it may lawfully do so)each of the Issuers and the Guarantors hereby expressly waive all benefit or advantage of any such law, and covenants that they will nothinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such poweras though no such law had been enacted.

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ARTICLE VII

Trustee

Section 7.1. Duties of Trustee. (a) If an Event of Default has occurred and is continuing, the Trustee shall exercise the rights andpowers vested in it by this Indenture and use the same degree of care and skill in their exercise as a prudent Person would exercise or useunder the circumstances in the conduct of such Person's own affairs; provided that if such an Event of Default occurs and is continuing, theTrustee will be under no obligation to exercise the rights or powers under this Indenture at the request or direction of any of the Holders unlesssuch Holders have offered to the Trustee indemnity or security against loss, liability or expense satisfactory to the Trustee in its solediscretion.

(b) Except during the continuance of an Event of Default of which a Trust Officer of the Trustee has actual knowledge:

(1) the Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Indenture and noimplied covenants or obligations shall be read into this Indenture against the Trustee; and

(2) in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and thecorrectness of the opinions expressed therein, upon certificates, opinions or orders furnished to the Trustee and conforming to therequirements of this Indenture. However, in the case of any such certificates or opinions which by any provisions hereof arespecifically required to be furnished to the Trustee, the Trustee shall examine such certificates and opinions to determine whether ornot they conform on their face to the requirements of this Indenture (but need not confirm or investigate the accuracy ofmathematical calculations or other facts stated therein).

(c) The Trustee may not be relieved from liability for its own negligent action, its own negligent failure to act or its own willfulmisconduct, except that:

(1) this paragraph does not limit the effect of paragraph (b) of this Section 7.1;

(2) the Trustee shall not be liable for any error of judgment made in good faith by a Trust Officer unless it is proved that theTrustee was negligent in ascertaining the pertinent facts; and

(3) the Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with adirection received by it pursuant to Section 6.5.

(d) Every provision of this Indenture that in any way relates to the Trustee is subject to paragraphs (a), (b) and (c) of this Section 7.1.

(e) The Trustee shall not be liable for interest on any money received by it except as the Trustee may agree in writing with the Issuers.

(f) Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law.

(g) No provision of this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur financial liability in theperformance of any of its duties hereunder or in the exercise of any of its rights or powers.

(h) Every provision of this Indenture relating to the conduct or affecting the liability of or affording protection to the Trustee shall besubject to the provisions of this Section 7.1 and to the provisions of the TIA.

(i) Unless otherwise specifically provided in this Indenture, any demand, request, direction or notice from any Issuer shall be sufficientif signed by an Officer of the Company.



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(j) The Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request ordirection of any of the Holders unless such Holders shall have offered to the Trustee reasonable security or indemnity satisfactory to it againstthe costs, expenses (including reasonable attorneys' fees and expenses) and liabilities that might be incurred by it in compliance with suchrequest or direction.

(k) The Trustee shall have no duty to confirm or verify the contents of any reports or certificates delivered to the Trustee pursuant to thisIndenture believed by the Trustee to be genuine and to have been signed or presented by the proper party or parties.

Section 7.2. Rights of Trustee. Subject to Section 7.1:

(a) The Trustee may conclusively rely on any document (whether in its original or facsimile form) reasonably believed by it to begenuine and to have been signed or presented by the proper person. The Trustee need not investigate any fact or matter stated in the document.

(b) Before the Trustee acts or refrains from acting, it may require an Officers' Certificate and/or an Opinion of Counsel. The Trusteeshall not be liable for any action it takes or omits to take in good faith in reliance on an Officers' Certificate or Opinion of Counsel.

(c) The Trustee may act through its attorneys and agents and shall not be responsible for the misconduct or negligence of any agentappointed with due care.

(d) The Trustee shall not be liable for any action it takes or omits to take in good faith which it believes to be authorized or within itsrights or powers, unless the Trustee's conduct constitutes willful misconduct or negligence.

(e) The Trustee may consult with counsel of its selection, and the advice or opinion of counsel with respect to legal matters relating tothis Indenture and the Notes shall be full and complete authorization and protection from liability in respect of any action taken, omitted orsuffered by it hereunder in good faith and in accordance with the advice or opinion of such counsel.

(f) The Trustee is not required to make any inquiry or investigation into facts or matters stated in any document but the Trustee, in itsdiscretion, may make such further inquiry or investigation into such facts or matters as it may see fit and, if the Trustee determines to makesuch further inquiry or investigation, it shall be entitled to examine the books, records and premises of the Company.

(g) The Trustee is not required to take notice or shall not be deemed to have notice of any Default or Event of Default hereunder, unlessa Trust Officer of the Trustee has actual knowledge thereof or has received notice in writing of such Default or Event of Default from anyIssuer or the Holders of at least 25% in aggregate principal amount of the Notes then outstanding, and in the absence of any such notice, theTrustee may conclusively assume that no such Default or Event of Default exists.

(h) The Trustee is not required to give any bond or surety with respect to the performance of its duties or the exercise of its powersunder this Indenture.

(i) In the event the Trustee receives inconsistent or conflicting requests and indemnity from two or more groups of Holders of Notes,each representing less than the aggregate principal amount of Notes outstanding required to take any action thereunder, the Trustee, in its solediscretion may determine what action, if any, shall be taken.

(j) The Trustee's immunities and protections from liability and its right to indemnification in connection with the performance of itsduties under this Indenture shall extend to the Trustee's officers, directors, agents, attorneys and employees. Such immunities and protectionsand right to indemnification, together with the Trustee's right to compensation, shall survive the Trustee's resignation or removal, thedischarge of this Indenture and final payments of the Notes.

(k) The permissive right of the Trustee to take actions permitted by this Indenture shall not be construed as an obligation or duty to doso and the Trustee shall not be answerable for other than its negligence or willful misconduct in the performance of such act.



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Section 7.3. Individual Rights of Trustee. The Trustee in its commercial banking or any other capacity may become the owner orpledgee of Notes and may otherwise deal with the Issuers, any Guarantor or any Affiliate of the Issuers with the same rights it would have if itwere not Trustee. Any Affiliate of the Trustee, and any Paying Agent, Registrar, co-registrar or co-paying agent, may do the same with likerights. However, in the event that the Trustee acquires any conflicting interest (as defined in the TIA) it must eliminate such conflict within90 days, apply to the Commission for permission to continue as trustee (if this Indenture has been qualified under the TIA) or resign. TheTrustee is also subject to Sections 7.10 and 7.11.

Section 7.4. Trustee's Disclaimer. The Trustee shall not be responsible for and makes no representation as to the validity or adequacy ofthis Indenture or the Notes, it shall not be accountable for the Issuers' use of the proceeds from the Notes, and it shall not be responsible forany statement of the Issuers in this Indenture or in any document issued in connection with the sale of the Notes or in the Notes other than theTrustee's certificate of authentication.

Section 7.5. Notice of Defaults. If a Default or Event of Default occurs and is continuing and if a Trust Officer has actual knowledgethereof, the Trustee shall mail to each Holder notice of the Default or Event of Default within 90 days after it. Except in the case of a Defaultor Event of Default in payment of principal of, premium, if any, or interest or Special Interest, if any, on any Note, the Trustee may withholdthe notice if and so long as a committee of its trust officers in good faith determines that withholding the notice is in the interests of Holders.

Section 7.6. Reports by Trustee to Holders. As promptly as practicable after each May 15 beginning with the May 15 following the dateof this Indenture, and for so long as the Notes remain outstanding, the Trustee shall mail to each Holder a brief report dated as of suchreporting date that complies with TIA § 313(a). The Trustee also shall comply with TIA § 313(b). The Trustee shall also transmit by mail allreports required by TIA § 313(c).

A copy of each report at the time of its mailing to Holders shall be filed with the Commission and each stock exchange (if any) on whichthe Notes are listed. The Issuers agree to notify promptly the Trustee whenever the Notes become listed on any stock exchange and of anydelisting thereof.

Section 7.7. Compensation and Indemnity. The Issuers shall pay to the Trustee from time to time reasonable compensation for itsacceptance of this Indenture and services hereunder as the Issuers and the Trustee shall from time to time agree in writing. The Trustee'scompensation shall not be limited by any law on compensation of a trustee of an express trust. The Issuers shall reimburse the Trustee uponrequest for all reasonable out-of-pocket expenses incurred or made by it, including costs of collection, costs of preparing and reviewingreports, certificates and other documents, costs of preparation and mailing of notices to Holders, in addition to the compensation for itsservices. Such expenses shall include the reasonable compensation and expenses, disbursements and advances of the Trustee's agents, counsel,accountants and experts. The Issuers shall indemnify the Trustee against any and all loss, liability, damages, claims or expense (including, butnot limited to, reasonable attorneys' fees and expenses) incurred by it without negligence or willful misconduct on its part in connection withthe administration of this trust and the performance of its duties hereunder, including the costs and expenses of enforcing this Indenture(including, but not limited to, this Section 7.7) and of defending itself against any claims (whether asserted by any Holder, the Issuers orotherwise). The Trustee shall notify the Issuers promptly of any claim for which it may seek indemnity. Failure by the Trustee to so notify theIssuers shall not relieve the Issuers of their obligations hereunder. The Issuers shall defend the claim and the Trustee shall provide reasonablecooperation at the Issuers' expense in the defense. The Trustee may have separate counsel and the Issuers shall pay the fees and expenses ofsuch counsel provided that the Issuers shall not be required to pay such fees and expenses if they assume the Trustee's defense, and, in thereasonable judgment of outside counsel to the Trustee, there is no conflict of interest between the Issuers and the Trustee in connection withsuch defense. The Issuers shall not be under any obligation to pay for any written settlement without their

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consent, which consent shall not be unreasonably delayed, conditioned or withheld. The Issuers need not reimburse any expense or indemnifyagainst any loss, liability or expense incurred by the Trustee through the Trustee's own willful misconduct or negligence.

Anything in this Indenture to the contrary notwithstanding, in no event shall the Trustee be liable for special, indirect or consequentialloss or damage of any kind whatsoever (including but not limited to lost profits) even if the Trustee has been advised of the likelihood of suchloss or damage and regardless of the form of action.

To secure the Issuers' payment obligations in this Section 7.7, the Trustee shall have a Lien prior to the Notes on all money or propertyheld or collected by the Trustee other than money or property held in trust to pay principal of, interest and Special Interest, if any, onparticular Notes.

The Issuers' payment obligations pursuant to this Section 7.7 shall survive the discharge of this Indenture. When the Trustee incursexpenses after the occurrence of a Default specified in clause (8) of Section 6.1 with respect to any Issuer, the expenses are intended toconstitute expenses of administration under any Bankruptcy Law.

Section 7.8. Replacement of Trustee. The Trustee may resign at any time by so notifying the Issuers. The Holders of a majority inprincipal amount of the then outstanding Notes may remove the Trustee by so notifying the Trustee and may appoint a successor Trustee. TheIssuers shall remove the Trustee if:

(1) the Trustee fails to comply with Section 7.10;

(2) the Trustee is adjudged bankrupt or insolvent;

(3) a receiver or other public officer takes charge of the Trustee or its property; or

(4) the Trustee otherwise becomes incapable of acting.

If the Trustee resigns or is removed by the Issuers or by the Holders of a majority in principal amount of the then outstanding Notes andsuch Holders do not reasonably promptly appoint a successor Trustee, or if a vacancy exists in the office of the Trustee for any reason (theTrustee in such event being referred to herein as the retiring Trustee), the Issuers shall promptly appoint a successor Trustee.

A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Issuers. Thereupon theresignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties ofthe Trustee under this Indenture. The successor Trustee shall mail a notice of its succession to Holders. The retiring Trustee shall promptlytransfer all property held by it as Trustee to the successor Trustee, subject to the Lien provided for in Section 7.7.

If a successor Trustee does not take office within 60 days after the retiring Trustee resigns or is removed, the retiring Trustee or theHolders of at least 10% in principal amount of the then outstanding Notes may petition, at the Issuers' expense, any court of competentjurisdiction for the appointment of a successor Trustee.

If the Trustee fails to comply with Section 7.10, unless the Trustee's duty to resign is stayed as provided in TIA § 310(b), any Holder whohas been a bona fide Holder of a Note for at least six months may petition any court of competent jurisdiction for the removal of the Trusteeand the appointment of a successor Trustee.

Notwithstanding the replacement of the Trustee pursuant to this Section 7.8, the Issuers' obligations under Section 7.7 shall continue forthe benefit of the retiring Trustee.



Section 7.9. Successor Trustee by Merger. If the Trustee consolidates with, merges or converts into, or transfers all or substantially allits corporate trust business or assets to, another corporation or banking

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association, the resulting, surviving or transferee corporation without any further act shall be the successor Trustee.

In case at the time such successor or successors by merger, conversion or consolidation to the Trustee shall succeed to the trusts createdby this Indenture, any of the Notes shall have been authenticated but not delivered, any such successor to the Trustee may adopt the certificateof authentication of any predecessor trustee, and deliver such Notes so authenticated; and in case at that time any of the Notes shall not havebeen authenticated, any successor to the Trustee may authenticate such Notes either in the name of any predecessor hereunder or in the nameof the successor to the Trustee; and in all such cases such certificates shall have the full force which it is anywhere in the Notes or in thisIndenture.

Section 7.10. Eligibility; Disqualification. The Trustee shall at all times satisfy the requirements of TIA § 310(a). The Trustee shallhave a combined capital and surplus of at least $100,000,000 as set forth in its most recent published annual report of condition. The Trusteeshall comply with TIA § 310(b); provided, however, that there shall be excluded from the operation of TIA § 310(b)(1) any indenture orindentures under which other securities or certificates of interest or participation in other securities of the Issuers are outstanding if therequirements for such exclusion set forth in TIA § 310(b)(1) are met.

Section 7.11. Preferential Collection of Claims Against Issuers. The Trustee shall comply with TIA § 311(a), excluding any creditorrelationship listed in TIA § 311(b). A Trustee who has resigned or been removed shall be subject to TIA § 311(a) to the extent indicated.

ARTICLE VIII

Legal Defeasance and Covenant Defeasance

Section 8.1. Option to Effect Legal Defeasance or Covenant Defeasance. The Issuers may, at any time at the option of their respectiveBoards of Directors, evidenced by a Board Besolution set forth in an Officers' Certificate, elect to have either Section 8.2 or 8.3 be applied toall outstanding Notes and Note Guarantees upon compliance with the conditions set forth in this Article VIII.

Section 8.2. Legal Defeasance and Discharge. Upon the Issuers' exercise under Section 8.1 of the option applicable to this Section 8.2,the Issuers shall, subject to the satisfaction of the conditions set forth in Section 8.4, be deemed to have been discharged from theirObligations with respect to all outstanding Notes on the date the conditions set forth below are satisfied (hereinafter, "Legal Defeasance") andeach Guarantor shall be released from all of its Obligations under its Note Guarantee. For this purpose, Legal Defeasance means that theIssuers shall be deemed to have paid and discharged the entire Indebtedness represented by the outstanding Notes, which shall thereafter bedeemed to be "outstanding" only for the purposes of Section 8.5 and the other Sections of this Indenture referred to in clauses (a) through(d) below, and to have satisfied all its other obligations under the Notes and this Indenture (and the Trustee, on demand of and at the expenseof the Issuers, shall execute proper instruments acknowledging the same), except for the following provisions which shall survive untilotherwise terminated or discharged hereunder: (a) the rights of Holders of outstanding Notes to receive, solely from the trust fund described inSections 8.4 and 8.5 hereof, and as more fully set forth in such Section, payments in respect of the principal of, premium, if any, interest andSpecial Interest, if any, on such Notes when such payments are due; (b) the Issuers' Obligations with respect to such Notes under Article II andSections 3.1 and 3.14; (c) the rights, powers, trusts, duties and immunities of the Trustee hereunder and the Issuers' and the Guarantors'Obligations in connection therewith; and (d) this Article VIII. If the Issuers exercise under Section 8.1 the option applicable to thisSection 8.2, subject to the satisfaction of the conditions set forth in Section 8.4, payment of the Notes may not be accelerated because of anEvent of Default. Subject to compliance with this Article VIII, the Issuers may exercise their option under this Section 8.2 notwithstanding theprior exercise of its option under Section 8.3.

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Section 8.3. Covenant Defeasance. Upon the Issuers' exercise under Section 8.1 of the option applicable to this Section 8.3, the Issuersshall, subject to the satisfaction of the conditions set forth in Section 8.4, be released from their obligations under the covenants contained inSections 3.2 through 3.13, 3.15 (other than with respect to the Company's corporate existence), 3.16, 3.17 and 3.21, and the operation ofclause (4) of Section 4.1 hereof, with respect to the outstanding Notes on and after the date the conditions set forth in Section 8.4 are satisfied(hereinafter, "Covenant Defeasance") and each Guarantor shall be released from all of its obligations under its Note Guarantee with respect tosuch covenants in connection with such outstanding Notes and the Notes shall thereafter be deemed not "outstanding" for the purposes of anydirection, waiver, consent or declaration or act of Holders (and the consequences of any thereof) in connection with such covenants, but shallcontinue to be deemed "outstanding" for all other purposes hereunder (it being understood that such Notes shall not be deemed outstanding foraccounting purposes). For this purpose, Covenant Defeasance means that, with respect to the outstanding Notes, the Issuers and theGuarantors may omit to comply with and shall have no liability in respect of any term, condition or limitation set forth in any such covenant,whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or by reason of any reference in any suchcovenant to any other provision herein or in any other document and such omission to comply shall not constitute a Default or an Event ofDefault under Section 6.1, but, except as specified above, the remainder of this Indenture and such Notes shall be unaffected thereby. If theIssuers exercise under Section 8.1 hereof the option applicable to this Section 8.3, subject to the satisfaction of the conditions set forth inSection 8.4, payment of the Notes may not be accelerated because of an Event of Default specified in clauses (3), (4) (with respect to Sections3.2 through 3.13, 3.15 (other than with respect to the Company's corporate existence), 3.16, and 3.17 and clause (4) of Section 4.1), (5),(6) and (8) of such Section 6.1 (but in the case of clause (8) of Section 6.1, with respect to Significant Subsidiaries only).

Section 8.4. Conditions to Legal or Covenant Defeasance. The following shall be the conditions to the application of either Section 8.2or 8.3 hereof to the outstanding Notes.

In order to exercise Legal Defeasance or Covenant Defeasance:

(1) the Company must irrevocably deposit with the Trustee, in trust, for the benefit of the Holders of the Notes, cash in U.S. dollars, non-callable Government Securities, or a combination of cash in U.S. dollars, and non-callable Government Securities, in amounts as will besufficient, in the opinion of a nationally recognized firm of independent public accountants (which opinion shall be addressed to and deliveredto the Trustee), to pay the principal of, and interest, Special Interest, if any, and premium, if any, on the outstanding Notes on the date of fixedmaturity or on the applicable Redemption Date, as the case may be, and the Company must specify whether the Notes are being defeased tothe date of fixed maturity or to a particular Redemption Date;

(2) in the case of Legal Defeasance, the Company shall deliver to the Trustee an Opinion of Counsel confirming that:

(a) the Company has received from, or there has been published by, the Internal Revenue Service a ruling; or

(b) since the date of this Indenture, there has been a change in the applicable federal income tax law,

in either case to the effect that, and based thereon such Opinion of Counsel shall confirm that, the beneficial owners of the outstanding Noteswill not recognize income, gain or loss for federal income tax purposes as a result of such Legal Defeasance and will be subject to federalincome tax in the same amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had notoccurred;

(3) in the case of Covenant Defeasance, the Company shall deliver to the Trustee an Opinion of Counsel confirming that the beneficialowners of the outstanding Notes will not recognize income, gain or

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loss for federal income tax purposes as a result of such Covenant Defeasance and will be subject to federal income tax in the same amounts, inthe same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred;

(4) no Default or Event of Default shall have occurred and be continuing on the date of such deposit (other than a Default or Event ofDefault resulting from the borrowing of funds to be applied to such deposit) and the deposit will not result in a breach or violation of, orconstitute a default under, any other instrument to which the Issuers or any Guarantor is a party or by which the Issuers or any Guarantor isbound;

(5) such Legal Defeasance or Covenant Defeasance will not result in a breach or violation of, or constitute a default under, any materialagreement or instrument (other than this Indenture) to which the Issuers or any of its Subsidiaries is a party or by which any of them is bound;

(6) the Company shall have delivered to the Trustee an Officers' Certificate stating that the deposit was not made by the Company withthe intent of preferring the Holders of Notes over the other creditors of the Company with the intent of defeating, hindering, delaying ordefrauding creditors of the Company or others; and

(7) the Company shall have delivered to the Trustee an Officers' Certificate and an Opinion of Counsel, each stating that all conditionsprecedent relating to the Legal Defeasance or the Covenant Defeasance have been complied with.

Section 8.5. Deposited Cash and Government Securities to be Held in Trust; Other Miscellaneous Provisions. Subject to Section 8.6, allcash and non-callable Government Securities (including the proceeds thereof) deposited with the Trustee (or other qualifying trustee),collectively for purposes of this Section 8.5, the "Trustee") pursuant to Section 8.4 in respect of the outstanding Notes shall be held in trustand applied by the Trustee, in accordance with the provisions of such Notes and this Indenture, to the payment, either directly or through anyPaying Agent (including the Company acting as Paying Agent) as the Trustee may determine, to the Holders of all sums due and to becomedue thereon in respect of principal, premium, if any, interest and Special Interest, if any, but such cash and securities need not be segregatedfrom other funds except to the extent required by law.

The Issuers shall pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the cash or non-callable Government Securities deposited pursuant to Section 8.4 or the principal and interest received in respect thereof other than any suchtax, fee or other charge which by law is for the account of the Holders of the outstanding Notes.

Anything in this Article VIII to the contrary notwithstanding, the Trustee shall deliver or pay to the Company from time to time upon therequest of the Company any cash or non-callable Government Securities held by it as provided in Section 8.4 hereof which, in the opinion of anationally recognized independent registered public accounting firm expressed in a written certification thereof delivered to the Trustee(which may be the certification delivered under clause (1) of Section 8.4 hereof), are in excess of the amount thereof that would then berequired to be deposited to effect an equivalent Legal Defeasance or Covenant Defeasance.

Section 8.6. Repayment to Company. Any cash or non-callable Government Securities deposited with the Trustee or any Paying Agent,or then held by the Company, in trust for the payment of the principal of, premium, if any, on, or interest or Special Interest, if any, on, anyNote and remaining unclaimed for one year after such principal, premium, if any, or interest or Special Interest, if any, has become due andpayable shall be paid to the Company on its request (unless an abandoned property law designates another Person) or (if then held by theCompany) shall be discharged from such trust; and the Holder shall thereafter, as an unsecured creditor, look only to the Issuers for paymentthereof, and all liability of the Trustee or such Paying Agent with respect to such cash and securities, and all liability of the Company asTrustee thereof, shall thereupon cease; provided, however, that the Trustee or such Paying

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Agent, before being required to make any such repayment, may at the expense of the Issuers cause to be published once, in The New YorkTimes and The Wall Street Journal (national edition), notice that such cash and securities remains unclaimed and that, after a date specifiedtherein, which shall not be less than 30 days from the date of such notification or publication, any unclaimed balance of such cash andsecurities then remaining shall be repaid to the Company.

Section 8.7. Reinstatement. If the Trustee or Paying Agent is unable to apply any cash or non-callable Government Securities inaccordance with Section 8.2, 8.3 or 8.5, as the case may be, by reason of any order or judgment of any court or governmental authorityenjoining, restraining or otherwise prohibiting such application, then the Issuers' obligations under this Indenture and the Notes shall berevived and reinstated as though no deposit had occurred pursuant to Section 8.4 until such time as the Trustee or Paying Agent is permitted toapply all such cash and securities in accordance with Section 8.2, 8.3 or 8.5, as the case may be; provided, however, that, if the Issuers makeany payment of principal of, premium, if any, on, or interest or Special Interest, if any, on, any Note following the reinstatement of itsobligations, the Issuers shall be subrogated to the rights of the Holders to receive such payment from the cash and securities held by theTrustee or Paying Agent.

ARTICLE IX

Amendments

Section 9.1. Without Consent of Holders. The Issuers, the Guarantors and the Trustee may amend or supplement this Indenture or theNotes or the Note Guarantees without notice to or consent of any Holder:

(1) to cure any ambiguity, defect or inconsistency;

(2) to provide for uncertificated Notes in addition to or in place of certificated Notes;

(3) to provide for the assumption of an Issuer's or a Guarantor's obligations to Holders of Notes and Note Guarantees in the case of amerger or consolidation or sale of all or substantially all of such Issuer's or such Guarantor's assets, as applicable;

(4) to make any change that would provide any additional rights or benefits to the Holders of Notes or that does not adversely affect thelegal rights under this Indenture of any Holder;

(5) to comply with requirements of the Commission in order to effect or maintain the qualification of this Indenture under the TrustIndenture Act;

(6) to conform the text of this Indenture, the Notes or the Note Guarantees to any provision of the section of the Offering Memorandumentitled "Description of Notes" to the extent such provision was intended to be a verbatim recitation of a provision of this Indenture, the Notesor the Note Guarantees;

(7) to provide for the issuance of Additional Notes in accordance with the limitations set forth in this Indenture;

(8) to allow any Guarantor to execute a supplemental indenture and/or a Note Guarantee with respect to the Notes;

(9) to add or release Note Guarantees pursuant to the terms of this Indenture;

(10) to secure the Notes; or

(11) to evidence and provide for the acceptance under this Indenture of a successor trustee.



After an amendment under this Indenture becomes effective, the Issuers are required to mail to the Holders a notice briefly describingsuch amendment. However, the failure to give such notice to all the

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Holders, or any defect therein, will not impair or affect the validity of the amendment or supplemental indenture under this Section 9.1.

Section 9.2. With Consent of Holders. The Issuers, the Guarantors and the Trustee may amend or supplement this Indenture or theNotes or the Note Guarantees without notice to any Holder but with the written consent of the Holders of at least a majority in aggregateprincipal amount of the Notes then outstanding (including, without limitation, consents obtained in connection with a purchase of, or tenderoffer or exchange offer for, Notes), and any existing Default or Event of Default or compliance with any provision of this Indenture or theNotes or the Note Guarantees may be waived with the consent of the Holders of a majority in aggregate principal amount of the thenoutstanding Notes (including consents obtained in connection with a purchase of, or tender offer or exchange offer for, Notes).

However, without the consent of each Holder affected, an amendment, supplement or waiver may not (with respect to any Notes held bya non-consenting Holder):

(1) reduce the principal amount of Notes whose Holders must consent to an amendment, supplement or waiver;

(2) reduce the principal of or change the fixed maturity of any Note or alter the provisions with respect to the redemption or repurchase ofthe Notes (other than provisions relating to Sections 3.7 and 3.9);

(3) reduce the rate of or change the time for payment of interest on any Note;

(4) waive a Default or Event of Default in the payment of principal of, or interest or premium or Special Interest, if any, on the Notes(except a rescission of acceleration of the Notes by the Holders of at least a majority in principal amount of the Notes and a waiver of thepayment default that resulted from such acceleration);

(5) make any Note payable in currency other than that stated in the Notes;

(6) make any change in the provisions of this Indenture relating to waivers of past Defaults or the rights of Holders of Notes to receivepayments of principal of, or interest or premium, if any, on the Notes;

(7) waive a redemption payment with respect to any Note (other than a payment required by Section 3.7 or 3.9);

(8) release any Guarantor from any of its obligations under its Note Guarantee or this Indenture, except in accordance with the terms ofthis Indenture; or

(9) make any change in the preceding amendment, supplement and waiver provisions.

It shall not be necessary for the consent of the Holders under this Section 9.2 to approve the particular form of any proposed amendment,but it shall be sufficient if such consent approves the substance thereof. A consent to any amendment or waiver under this Indenture by anyHolder of the Notes given in connection with a tender of such Holder's Notes will not be rendered invalid by such tender.

After an amendment under this Section becomes effective, the Issuers shall mail to Holders a notice briefly describing such amendment.The failure to give such notice to all Holders, or any defect therein, shall not impair or affect the validity of an amendment supplementalindenture or waiver under this Section 9.2.

Section 9.3. Compliance with Trust Indenture Act. Every amendment or supplement to this Indenture or the Notes shall comply withthe TIA as then in effect.

Section 9.4. Revocation and Effect of Consents and Waivers. A consent to an amendment or a waiver by a Holder of a Note shall bindthe Holder and every subsequent Holder of that Note or portion of the Note that evidences the same debt as the consenting Holder's Note, evenif notation of the consent or waiver is not made on the Note. However, any such Holder or subsequent Holder may revoke the consent or



waiver as to such Holder's Note or portion of the Note if the Trustee receives the notice of revocation before the date the amendment or waiverbecomes effective. After an amendment or waiver becomes effective, it shall bind every Holder.

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For purposes of this Indenture, the written consent of the Holder of a Global Note shall be deemed to include any consent delivered by anAgent Member by electronic means in accordance with the Automated Tender Offer Procedures system or other customary procedures of, andpursuant to authorization by, DTC.

The Issuers may, but shall not be obligated to, fix a record date for the purpose of determining the Holders entitled to give their consentor take any other action described above or required or permitted to be taken pursuant to this Indenture. If a record date is fixed, thennotwithstanding the immediately preceding paragraph, those Persons who were Holders at such record date (or their duly designated proxies),and only those Persons, shall be entitled to give such consent or to revoke any consent previously given or to take any such action, whether ornot such Persons continue to be Holders after such record date. No such consent shall become valid or effective more than 120 days after suchrecord date.

Section 9.5. Notation on or Exchange of Notes. If an amendment changes the terms of a Note, the Trustee may require the Holder of theNote to deliver it to the Trustee. The Trustee may place an appropriate notation on the Note regarding the changed terms and return it to theHolder. Alternatively, if the Issuers or the Trustee so determine, the Issuers in exchange for the Note shall issue and the Trustee shallauthenticate a new Note that reflects the changed terms. Failure to make the appropriate notation or to issue a new Note shall not affect thevalidity of such amendment.

Section 9.6. Trustee To Sign Amendments. The Trustee shall sign any amendment authorized pursuant to this Article IX if theamendment does not adversely affect the rights, duties, liabilities or immunities of the Trustee. If the amendment does so affect the Trustee,the Trustee may but need not sign it. In signing such amendment the Trustee shall be entitled to receive indemnity reasonably satisfactory to itand to receive, and (subject to Sections 7.1 and 7.2) shall be fully protected in relying upon an Officers' Certificate and an Opinion of Counselboth stating that such amendment is authorized or permitted by this Indenture.

ARTICLE X

Note Guarantee

Section 10.1. Note Guarantee. Subject to the limitations set forth in this Article X and Section 12.10, each Guarantor hereby fully andunconditionally guarantees, as primary obligor and not merely as surety, jointly and severally with each other Guarantor, to each Holder of aNote authenticated and delivered by the Trustee and the Trustee the full and punctual payment when due, whether at maturity, by acceleration,by redemption or otherwise, of the principal of, premium, if any, interest and Special Interest, if any, on the Notes and all other monetaryObligations of the Issuers under this Indenture. Each Guarantor further agrees (to the extent permitted by law) that the Obligations may beextended or renewed, in whole or in part, without notice or further assent from it, and that it will remain bound under this Article Xnotwithstanding any extension or renewal of any Obligation.

Each Guarantor waives presentation to, demand of payment from and protest to the Issuers of any of the Obligations and also waivesnotice of protest for nonpayment. Each Guarantor waives notice of any default under the Notes or the Obligations. The obligations of eachGuarantor hereunder shall not be affected by (a) the failure of any Holder to assert any claim or demand or to enforce any right or remedyagainst any Issuer or any other Person under this Indenture, the Notes or any other agreement or otherwise; (b) any extension or renewal ofany thereof; (c) any rescission, waiver, amendment or modification of any of the terms or provisions of this Indenture, the Notes or any otheragreement; (d) the release of any Note held by any Holder or the Trustee for the Obligations owed to any of them; (e) the failure of any Holderto exercise any right or remedy against any other Guarantor; or (f) any change in the ownership of any Issuer.

Each Guarantor further agrees that its Note Guarantee herein constitutes a Guarantee of payment when due (and not a Guarantee ofcollection) and waives any right to require that any resort be had by any Holder to any Note held for payment of the Obligations.

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Except as expressly set forth in Article VIII and Section 10.2, the obligations of each Guarantor hereunder shall not be subject to anyreduction, limitation, impairment or termination for any reason (other than payment of the Obligations in full), including any claim of waiver,release, surrender, alteration or compromise, and shall not be subject to any defense of setoff, counterclaim, recoupment or terminationwhatsoever or by reason of the invalidity, illegality or unenforceability of the Obligations or otherwise. Without limiting the generality of theforegoing, the obligations of each Guarantor herein shall not be discharged or impaired or otherwise affected by the failure of the Trustee orany Holder to assert any claim or demand or to enforce any remedy under this Indenture, the Notes or any other agreement, by any waiver ormodification of any thereof, by any default, failure or delay, willful or otherwise, in the performance of the Obligations, or by any other act orthing or omission or delay to do any other act or thing which may or might in any manner or to any extent vary the risk of any Guarantor orwould otherwise operate as a discharge of such Guarantor as a matter of law or equity.

Each Guarantor further agrees that its Note Guarantee herein shall continue to be effective or be reinstated, as the case may be, if at anytime payment, or any part thereof, of principal of or interest or Special Interest, if any, on any of the Obligations is rescinded or mustotherwise be restored by any Holder upon the bankruptcy or reorganization of the Company or otherwise.

In furtherance of the foregoing and not in limitation of any other right which any Holder has at law or in equity against any Guarantor byvirtue hereof, upon the failure of the Issuers to pay any of the Obligations when and as the same shall become due, whether at maturity, byacceleration, by redemption or otherwise, each Guarantor hereby promises to and will, upon receipt of written demand by the Trustee,forthwith pay, or cause to be paid, in cash, to the Holders an amount equal to the sum of (i) the unpaid amount of such Obligations then dueand owing and (ii) accrued and unpaid interest on such Obligations then due and owing (but only to the extent not prohibited by law) andexcept as provided in Section 10.2.

Each Guarantor further agrees that, as between such Guarantor, on the one hand, and the Holders, on the other hand, (x) the maturity ofthe Obligations Guaranteed hereby may be accelerated as provided in this Indenture for the purposes of its Note Guarantee herein,notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the Obligations Guaranteed hereby and(y) in the event of any such declaration of acceleration of such Obligations, such Obligations (whether or not due and payable) shall forthwithbecome due and payable by the Guarantor for the purposes of this Note Guarantee.

Each Guarantor also agrees to pay any and all reasonable costs and expenses (including, but not limited to, reasonable attorneys' fees)incurred by the Trustee or the Holders in enforcing any rights under this Section 10.1.

Section 10.2. Limitation on Liability; Termination, Release and Discharge.

(a) The obligations of each Guarantor hereunder will be limited to the maximum amount as will, after giving effect to all othercontingent and fixed liabilities of such Guarantor and after giving effect to any collections from or payments made by or on behalf of anyother Guarantor in respect of the obligations of such other Guarantor under its Note Guarantee or pursuant to its contribution obligations underthis Indenture, result in the obligations of such Guarantor under its Note Guarantee not constituting a fraudulent conveyance or fraudulenttransfer under federal or state law.

(b) Subject to Article IV and Section 3.7, a Subsidiary Guarantor may not sell or otherwise dispose of all or substantially all of its assetsto, or consolidate with or merge into (whether or not such Guarantor is the surviving Person), another Person, other than the Company oranother Guarantor, unless:

(1) immediately after giving effect to such transaction, no Default or Event of Default exists; and

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(2) either:

(A) the Person acquiring the property in any such sale or disposition or the Person formed by or surviving any suchconsolidation or merger assumes all the obligations of that Guarantor under this Indenture, its Note Guarantee and theRegistration Rights Agreement on terms set forth therein pursuant to a supplemental indenture substantially in the form setforth as Exhibit C to this Indenture; or

(B) the Net Proceeds of such sale or other disposition are applied in accordance with Section 3.7.

(c) A Guarantor may consolidate with or merge into or sell or otherwise dispose of all or substantially all of its assets to the Company oranother Guarantor without limitation, except to the extent that any such transaction is subject to the provisions of Article IV and Section 3.7.

(d) The Note Guarantee of a Guarantor will be released and the Guarantor will be relieved of its obligations under this Indenture and itsNote Guarantee without any further action required on the part of the Company or such Guarantor:

(1) in connection with any sale or other disposition of all or substantially all of the assets of that Guarantor (including by wayof merger or consolidation) to a Person that is not (either before or after giving effect to such transaction) the Company or aRestricted Subsidiary thereof, if the sale or other disposition does not violate Section 3.7; or

(2) in connection with any sale or other disposition of all of the Capital Stock of that Guarantor (including by way of mergeror consolidation) to a Person that is not (either before or after giving effect to such transaction) the Company or a RestrictedSubsidiary thereof, if the sale or other disposition does not violate Section 3.7; or

(3) if the Company designates any Restricted Subsidiary that is a Guarantor to be an Unrestricted Subsidiary in accordancewith the applicable provisions of this Indenture;

(4) upon Legal Defeasance or Covenant Defeasance as provided in Article VIII or upon satisfaction and discharge of thisIndenture as provided in Article XI; or

(5) at such time as such Guarantor ceases to have outstanding guarantees of any Indebtedness under the Credit Facility.

Section 10.3. Limitation of Guarantors' Liability. Each Guarantor, and by its acceptance hereof each Holder, hereby confirms that it is theintention of all such parties that the Guarantee by such Guarantor pursuant to its Note Guarantee not constitute a fraudulent transfer orconveyance for purposes of the Federal Bankruptcy Code, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act orany similar federal or state law. To effectuate the foregoing intention, the Holders, Trustee and each Guarantor hereby irrevocably agree thatthe obligations of such Guarantor under its Note Guarantee will be limited to the maximum amount as will, after giving effect to all othercontingent and fixed liabilities of such Guarantor and after giving effect to any collections from or payments made by or on behalf of anyother Guarantor in respect of the obligations of such other Guarantor under its Note Guarantee or pursuant to Section 10.4, result in theobligations of such Guarantor under its Note Guarantee not constituting such a fraudulent conveyance or fraudulent transfer. This Section 10.3is for the benefit of the creditors of each Guarantor.

Section 10.4. Contribution. The Guarantors shall have the right to contribution from any non-paying Guarantors so long as the exercise ofsuch right does not impair the rights of the Holders.

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ARTICLE XI

Satisfaction and Discharge

Section 11.1. Satisfaction and Discharge. This Indenture will be discharged and will cease to be of further effect as to all Notes issuedhereunder (except as to surviving rights of registration of transfer or exchange of the Notes and as otherwise specified hereunder), when:

(1) either:

(a) all Notes that have been authenticated, except lost, stolen or destroyed Notes that have been replaced or paid and Notes forwhose payment money has been deposited in trust and thereafter repaid to the Issuers, have been delivered to the Trustee forcancellation; or

(b) all Notes that have not been delivered to the Trustee for cancellation have become due and payable or will become due andpayable within one year by reason of the mailing of a notice of redemption or otherwise and any Issuer or any Guarantor hasirrevocably deposited or caused to be deposited with the Trustee as trust funds in trust solely for the benefit of the Holders, cash inU.S. dollars, non-callable Government Securities, or a combination of cash in U.S. dollars and non-callable Government Securities,in amounts as will be sufficient without consideration of any reinvestment of interest, to pay and discharge the entire indebtednesson the Notes not delivered to the Trustee for cancellation for principal, premium, if any, and accrued interest and Special Interest, ifany, to the date of fixed maturity or redemption;

(2) no Default or Event of Default has occurred and is continuing on the date of the deposit (other than a Default or Event of Defaultresulting from the borrowing of funds to be applied to such deposit) and the deposit will not result in a breach or violation of, or constitute adefault under, any other instrument (other than this Indenture) to which an Issuer or any Guarantor is a party or by which an Issuer or anyGuarantor is bound;

(3) an Issuer or any Guarantor has paid or caused to be paid all sums payable by it under this Indenture;

(4) the Issuers have delivered irrevocable instructions to the Trustee hereunder to apply the deposited money toward the payment of theNotes at fixed maturity or the Redemption Date, as the case may be; and

(5) the Company has delivered to the Trustee an Officers' Certificate and an Opinion of Counsel, which, taken together, state that allconditions precedent under the Indenture relating to the satisfaction and discharge of this Indenture have been complied with. article XIIMiscellaneousSection 12.1. Trust Indenture Act Controls. If any provision of this Indenture limits, qualifies or conflicts with another provisionwhich is required to be included in this Indenture by the TIA, the provision required by the TIA shall control. Each Guarantor in addition toperforming its obligations under its Note Guarantee shall perform such other obligations as may be imposed upon it with respect to thisIndenture under the TIA.

Section 12.2. Notices. Any notice or communication shall be in writing and delivered in person, by telecopier or overnight air courierguaranteeing next day delivery or mailed by first-class mail addressed as follows:

if to the Issuers:

Tronox Worldwide LLCTronox Finance Corp.123 Robert S. Kerr AvenueOklahoma City, Oklahoma 73102Facsimile No.:



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if to the Trustee:

Citibank, N.A.388 Greenwich Street, 14thNew York, NY 10013Facsimile No.: (212) 816-5527Attention: Agency & Trust Dept.

The Issuers or the Trustee by notice to the other may designate additional or different addresses for subsequent notices orcommunications.

Any notice or communication mailed to a registered Holder shall be mailed to the Holder at the Holder's address as it appears on theregistration books of the Registrar and shall be sufficiently given if so mailed within the time prescribed. Any notice or communication shallalso be mailed to any Person described in TIA § 3.13(c), to the extent required by the TIA.

Failure to mail a notice or communication to a Holder or any defect in it shall not affect its sufficiency with respect to other Holders. If anotice or communication is mailed in the manner provided above, it is duly given, whether or not the addressee receives it.

Section 12.3. Communication by Holders with other Holders. Holders may communicate pursuant to TIA § 312(b) with other Holderswith respect to their rights under this Indenture or the Notes. The Issuers, the Trustee, the Registrar and anyone else shall have the protectionof TIA § 312(c).

Section 12.4. Certificate and Opinion as to Conditions Precedent. Upon any request or application by the Issuers to the Trustee to take orrefrain from taking any action under this Indenture, the Company shall furnish to the Trustee:

(1) an Officers' Certificate in form and substance reasonably satisfactory to the Trustee stating that, in the opinion of thesigners, all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with; and

(2) an Opinion of Counsel in form and substance reasonably satisfactory to the Trustee stating that, in the opinion of suchcounsel, all such conditions precedent have been complied with.

In any case where several matters are required to be certified by, or covered by an opinion of, any specified Person, it is not necessarythat all such matters be certified by, or covered by the opinion of, only one such Person, or that they be so certified or covered by only onedocument, but one such Person may certify or give an opinion as to such matters in one or several documents.

Any certificate or opinion of an Officer of an Issuer or any Guarantor may be based, insofar as it relates to legal matters, upon acertificate or opinion of, or representations by, counsel, unless such Officer knows, or in the exercise of reasonable care should know, that thecertificate or opinion or representations with respect to the matters upon which his certificate or opinion is based are erroneous. Any suchcertificate or Opinion of Counsel may be based, and may state that it is so based, insofar as it relates to factual matters, upon a certificate oropinion of, or representations by, an Officer or Officers of an Issuer or such Guarantor stating that the information with respect to such factualmatters is in possession of such Issuer or such Guarantor, unless such counsel knows that the certificate or opinion or representations withrespect to such matters are erroneous.

Where any Person is required to make, give or execute two or more applications, requests, consents, certificates, statements, opinions orother instruments under this Indenture, they may, but need not, be consolidated and form one instrument.

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Section 12.5. Statements Required in Certificate or Opinion. Each certificate or opinion with respect to compliance with a covenant orcondition provided for in this Indenture (except the Certificate specified in Section 3.17) shall include:

(1) a statement that the individual making such certificate or opinion has read such covenant or condition;

(2) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinionscontained in such certificate or opinion are based;

(3) a statement that, in the opinion of such individual, he has made such examination or investigation as is necessary to enablehim to express an informed opinion as to whether or not such covenant or condition has been complied with; and

(4) a statement as to whether or not, in the opinion of such individual, such covenant or condition has been complied with.

Section 12.6. When Notes Disregarded. In determining whether the Holders of the required principal amount of Notes have concurred inany direction, waiver or consent, Notes owned by Parent, any Issuer or by any Person directly or indirectly controlling or controlled by orunder direct or indirect common control with Parent or any Issuer shall be disregarded and deemed not to be outstanding, except that, for thepurpose of determining whether the Trustee shall be protected in relying on any such direction, waiver or consent, only Notes which theTrustee has actual knowledge are so owned shall be so disregarded. Also, subject to the foregoing, only Notes outstanding at the time shall beconsidered in any such determination.

Section 12.7. Rules by Trustee, Paying Agent and Registrar. The Trustee may make reasonable rules for action by, or a meeting of,Holders. The Registrar and the Paying Agent may make reasonable rules for their functions.

Section 12.8. Legal Holidays. A "Legal Holiday" is a Saturday, a Sunday or other day on which commercial banking institutions areauthorized or required to be closed in New York, New York. If a payment date is a Legal Holiday, payment shall be made on the nextsucceeding day that is not a Legal Holiday, and no interest shall accrue for the intervening period. If a regular record date is a Legal Holiday,the record date shall not be affected.

Section 12.9. GOVERNING LAW. THIS INDENTURE AND THE NOTES SHALL BE GOVERNED BY, AND CONSTRUED INACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

Section 12.10. No Recourse Against Others. No director, manager, officer, employee, incorporator, member or stockholder or otherowner of Capital Stock of any Issuer or any Guarantor, as such, shall have any liability for any obligations of any Issuer or any Guarantorunder the Notes, this Indenture or the Note Guarantees, or for any claim based on, in respect of, or by reason of such obligations or theircreation. Each Holder of Notes by accepting a Note waives and releases all such liability.

Section 12.11. Successors. All agreements of each Issuer in this Indenture and the Notes shall bind its successors. All agreements of theTrustee in this Indenture shall bind its successors.

Section 12.12. Multiple Originals. The parties may sign any number of copies of this Indenture. Each signed copy shall be an original,but all of them together represent the same agreement. One signed copy is enough to prove this Indenture.

Section 12.13. Qualification of Indenture. The Issuers shall qualify this Indenture under the TIA in accordance with the terms andconditions of the Registration Rights Agreement and shall pay all reasonable costs and expenses (including, but not limited to, attorneys' feesand expenses for the Issuers, the Trustee and the Holders) incurred in connection therewith, including, but not limited to, costs and expensesof qualification of this Indenture and the Notes and printing this Indenture and the Notes. The

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Trustee shall be entitled to receive from the Issuers any such Officers' Certificates or other documentation as it may reasonably request inconnection with any such qualification of this Indenture under the TIA.

Section 12.14. Severability. In case any provision in this Indenture or in the Notes shall be invalid, illegal or unenforceable, the validity,legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

Section 12.15. No Adverse Interpretation of Other Agreements. This Indenture may not be used to interpret any other indenture, loan ordebt agreement of any Issuer, any Guarantor or any other Person. Any such indenture, loan or debt agreement may not be used to interpret thisIndenture or the Note Guarantees.

Section 12.16. Table of Contents; Headings. The table of contents, cross-reference sheet and headings of the Articles and Sections of thisIndenture have been inserted for convenience of reference only, are not intended to be considered a part hereof and shall not modify or restrictany of the terms or provisions hereof.

Section 12.17. Rights of Paying Agent and Registrar. For so long as the Trustee also serves as Paying Agent and/or Registrar, all rights,protections and indemnities set forth in this Indenture for the Trustee shall be equally applicable for the Paying Agent and/or Registrar.

[Signature Page Follows]

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IN WITNESS WHEREOF, the parties have caused this Indenture to be duly executed as of the date first written above.


By: Name:Title:

TRONOX FINANCE CORP.

By:Name:Title:

GUARANTORS

CIMARRON CORPORATION

By:Name:Title:

KERR-MCGEE HOLDINGS, INC.

By:Name:Title:

KERR-MCGEE MINERALS RESOURCES CORPORATION

By:Name:Title:

KERR-MCGEE PIGMENTS (SAVANNAH) INC.

By:Name:Title:



KERR-MCGEE REFINING CORPORATION

By:Name:Title:

SOUTHWESTERN REFINING COMPANY, INC.

By:Name:Title:

TRANSWORLD DRILLING COMPANY

By:Name:Title:

TRIANGLE REFINERIES, INC.

By:Name:Title:

TRIPLE S, INC.

By:Name:Title:

TRONOX LLC

By:Name:Title:

TRONOX INCORPORATED

By:Name:Title:



CITIBANK, N.A.,as Trustee

By:Name:Title:



EXHIBIT A

[FORM OF FACE OF NOTE]

THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED(THE "SECURITIES ACT"), OR OTHER SECURITIES LAWS. NEITHER THIS NOTE NOR ANY INTEREST OR PARTICIPATIONHEREIN MAY BE RE-OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OFIN THE ABSENCE OF SUCH REGISTRATION OR UNLESS THE TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THEREGISTRATION REQUIREMENTS OF THE SECURITIES ACT. EACH PURCHASER OF THE NOTE EVIDENCED HEREBY ISHEREBY NOTIFIED THAT THE SELLER MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OFTHE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. THE HOLDER OF THIS NOTE BY ITS ACCEPTANCEHEREOF (1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THESECURITIES ACT) OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING ITS NOTE IN AN "OFFSHORE TRANSACTION"PURSUANT TO RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, (2) AGREES THAT IT WILL NOT PRIOR TO(X) THE DATE WHICH IS TWO YEARS (OR SUCH SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144(K) UNDER THESECURITIES ACT OR ANY SUCCESSOR PROVISION THEREUNDER) AFTER THE LATER OF THE ORIGINAL ISSUE DATEHEREOF (OR OF ANY PREDECESSOR OF THIS NOTE) OR THE LAST DAY ON WHICH ANY ISSUER OR ANY AFFILIATE OFTHE ISSUERS WAS THE OWNER OF THIS NOTE (OR ANY PREDECESSOR OF THIS NOTE) AND (Y) SUCH LATER DATE, IFANY, AS MAY BE REQUIRED BY APPLICABLE LAW (THE "RESALE RESTRICTION TERMINATION DATE"), OFFER, SELL OROTHERWISE TRANSFER THIS NOTE EXCEPT (A) TO ANY ISSUER, (B) PURSUANT TO A REGISTRATION STATEMENT WHICHHAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE NOTES ARE ELIGIBLE FORRESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER"AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THEACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADEIN RELIANCE ON RULE 144A INSIDE THE UNITED STATES, (D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONSTHAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT OR(E) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIESACT AND (3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS NOTE IS TRANSFERRED A NOTICESUBSTANTIALLY TO THE EFFECT OF THIS LEGEND; PROVIDED THAT THE ISSUERS, THE TRUSTEE AND THE REGISTRARSHALL HAVE THE RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER (I) PURSUANT TO CLAUSE (D) OR (E) TOREQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORYTO EACH OF THEM AND (II) IN EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATION OF TRANSFER INTHE FORM APPEARING ON THE OTHER SIDE OF THE NOTE IS COMPLETED AND DELIVERED BY THIS TRANSFEROR TOTHE TRUSTEE. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALERESTRICTION TERMINATION DATE. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND"U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT.

[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUSTCOMPANY, A NEW YORK CORPORATION ("DTC"), NEW

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YORK, NEW YORK, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, ANDANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BYAN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITYAS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOFFOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF,CEDE & CO., HAS AN INTEREST HEREIN.

TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEESOF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THISGLOBAL NOTE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THEINDENTURE REFERRED TO ON THE REVERSE HEREOF.]

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No. [ ] Principal Amount $[ ]CUSIP NO.

TRONOX WORLDWIDE LLCTRONOX FINANCE CORP.

[ ]% Senior Note due 2012

Tronox Worldwide LLC, a Delaware limited liability company (the "Company"), and Tronox Finance Corp., a Delaware corporation("Tronox Finance" and, together with the Company, the "Issuers"), promise to pay to , or registered assigns, the principal sum of[ ] Dollars or such greater or lesser amount as shall be reflected on the books and records of the custodian with respect to theGlobal Note (as appointed by DTC) (the "Notes Custodian")1, on [ ], 2012.

Interest Payment Dates: [ ]

Record Dates: [ ]

Additional provisions of this Note are set forth on the other side of this Note.

1Global Note only

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In witness whereof, the Issuers have caused this instrument to be duly executed.


By:/s/

Name:Title:


By:/s/Name:Title:

TRUSTEE'S CERTIFICATE OF AUTHENTICATION

Citibank, N.A., not in its individual capacity but solely as Trustee, certifiesthat this is one of the Notes referred to in the Indenture.

By: Date:Authorized Signatory

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[FORM OF REVERSE SIDE OF NOTE]


1. Interest

Tronox Worldwide LLC, a Delaware limited liability company (the "Company"), and Tronox Finance Corp., a Delaware corporation("Tronox Finance" and, together with the Company, the "Issuers"), promise to pay interest on the principal amount of this Note at the rate perannum shown above.

The Issuers will pay interest semiannually in arrears in cash on [ ] and [ ] of each year or if any such day is not a businessday, on the next succeeding business day (each an "Interest Payment Date") commencing on [ ], 2006 and will pay Special Interest, ifany, as provided in the Registration Rights Agreement relating to these Notes. Interest on the Notes will accrue from the most recent date towhich interest has been paid on the Notes or, if no interest has been paid, from and including [ ], 2005. The Issuers shall pay interest onoverdue principal and interest and Special Interest, if any, from time to time at a rate that is 1% per annum higher than the interest rate then ineffect under the Indenture and this Note. Interest will be computed on the basis of a 360-day year of twelve 30-day months.

2. Method of Payment

By no later than 11:00 a.m. (New York City time) on the date on which any principal of, interest and premium and Special Interest, ifany, on, any Note is due and payable, the Issuers shall deposit with the Trustee or the Paying Agent money sufficient to pay such principal,interest and premium and Special Interest, if any. The Issuers will pay principal, interest (except Defaulted Interest) and premium and SpecialInterest, if any, to the Persons who are registered Holders of Notes at the close of business on [ ] or [ ] preceding the InterestPayment Date, even if Notes are cancelled, repurchased or redeemed after the record date and on or before the Interest Payment Date. Holdersmust surrender Notes to a Paying Agent to collect principal payments. The Issuers will pay principal, interest and premium and SpecialInterest, if any, in money of the United States that at the time of payment is legal tender for payment of public and private debts. Payments ofall principal, interest and premium and Special Interest, if any, on the Notes will be made to each registered Holder by wire transfer inimmediately available funds if that Holder has given to the Issuers, through the Paying Agent or otherwise, wire instructions at least fivebusiness days prior to the applicable payment date or by check mailed to the address of the Holder as it appears on the books of the registrar ifthe Holder has not provided wire instructions; provided that the final distribution in respect of any Note will be made only upon presentationand surrender of such Note at the applicable Corporate Trust Office of the Trustee.

3. Paying Agent and Registrar

Initially, Citibank, N.A. (the "Trustee"), will act as Trustee, Paying Agent and Registrar. The Issuers may appoint and change any PayingAgent, Registrar or co-registrar without prior notice to any Holder of the Notes. The Issuers or any of their Subsidiaries may act as PayingAgent, Registrar or co-registrar.

4. Indenture

The Issuers issued the Notes under an Indenture dated as of November , 2005 (as it may be amended or supplemented from time to timein accordance with the terms thereof, the "Indenture"), among the Issuers, the Guarantors party thereto and the Trustee. The terms of the Notesinclude those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C. §§77aaa-77bbbb) as in effect on the Issue Date (the "Act"). Capitalized terms used herein and not defined herein have the meanings ascribedthereto in the Indenture. The Notes are subject to all terms in the Indenture, and Holders are referred to the Indenture and the Act for astatement of those

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terms. To the extent any provision of this Note conflicts with the express provisions of the Indenture, the provisions of the Indenture shallgovern and be controlling.

The Notes are general unsecured senior obligations of the Issuers. The aggregate principal amount of Notes that may be authenticated anddelivered under the Indenture is limited to an aggregate principal amount at maturity of $350,000,000, subject to the Issuers' ability to issueAdditional Notes. The Indenture imposes certain limitations, among other things, on the ability of the Issuers and their Restricted Subsidiariesto make Investments; incur additional Indebtedness or issue Preferred Stock; create certain Liens; sell assets; enter into agreements that restrictdividends or other payments from the Restricted Subsidiaries; consolidate, merge or transfer all or substantially all of the assets of the Issuersand their Restricted Subsidiaries; engage in transactions with Affiliates; pay dividends or make other distributions on Capital Stock orsubordinated Indebtedness; enter into different lines of business; create Unrestricted Subsidiaries; and enter into sale and leasebacktransactions.

To guarantee the due and punctual payment of the principal of, interest and premium and Special Interest, if any, on, the Notes and allother amounts payable by the Issuers under the Indenture and the Notes when and as the same shall be due and payable, whether at maturity,by acceleration or otherwise, according to the terms of the Notes and the Indenture, the Guarantors have unconditionally guaranteed (andfuture Guarantors, together with the Guarantors, will unconditionally guarantee), jointly and severally, such obligations pursuant to the termsof the Indenture.

5. Redemption

Except as forth below, the Notes will not be redeemable at the option of the Issuers prior to [ ], 2009. On and after such date, theNotes will be redeemable, at the Issuers' option, in whole or in part, at any time upon not less than 30 nor more than 60 days prior noticemailed by first-class mail to each Holder's registered address, at the following redemption prices (expressed in percentages of principalamount), plus accrued and unpaid interest and Special Interest, if any, thereon, if any, to the Redemption Date (subject to the right of Holdersof record on the relevant record date to receive interest due on an interest payment date that is on or prior to the Redemption Date) if redeemedduring the 12-month period commencing on [ ] of the years indicated below, subject to the rights of Holders of Notes on the relevantrecord date to receive interest due on the relevant Interest Payment Date:

PeriodRedemption

Price

2009 %2010 %2011 and thereafter 100.000%

In addition, at any time and from time to time prior to [ ], 2008, the Issuers may redeem up to 35% of the aggregate principalamount of the Notes (calculated after giving effect to any issuance of Additional Notes) at a redemption price of [ ]% of the principalamount plus accrued and unpaid interest and Special Interest, if any, to the Redemption Date, with the net cash proceeds of one or moreEquity Offerings; provided, that (1) at least 65% of the aggregate principal amount of the Notes, calculated after giving effect to any issuanceof Additional Notes, originally issued under the Indenture (including Notes held by Parent, any Issuer and their Subsidiaries) remainsoutstanding after each such redemption and (2) each such redemption occurs within 90 days of the date of closing of such Equity Offering.

Notice of any redemption upon an Equity Offering may be given prior to the completion of the related Equity Offering, and any suchredemption or notice may, at the Issuers' discretion, be subject to one or more conditions precedent, including completion of the related EquityOffering.

If the optional Redemption Date is on or after an interest record date and on or before the related interest payment date, the accrued andunpaid interest and Special Interest, if any, will be paid to the

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Person in whose name the Note is registered at the close of business on such record date, and no Special Interest will be payable to Holderswhose Notes will be subject to redemption by the Issuers.

In the case of any partial redemption, selection of the Notes for redemption will be made by the Trustee in compliance with therequirements of the principal national securities exchange, if any, on which the Notes are listed or, if the Notes are not listed, then on a prorata basis, although no Notes of $1,000 in original principal amount or less will be redeemed in part. If any Note is to be redeemed in partonly, the notice of redemption relating to such Note shall state the portion of the principal amount thereof to be redeemed. A new Note inprincipal amount equal to the unredeemed portion thereof will be issued in the name of the Holder thereof upon cancellation of the originalNote. On and after the Redemption Date, interest will cease to accrue on Notes or portions thereof called for redemption as long as the Issuershave deposited with the Paying Agent funds in satisfaction of the applicable redemption price pursuant to the Indenture.

6. Mandatory Redemption

The Issuers are not required to make mandatory redemption or sinking fund payments with respect to the Notes. However, the Issuersmay be required to offer to repurchase the Notes under Sections 3.7 and 3.9 of the Indenture.

7. Repurchase Provisions

(a) Upon a Change of Control any Holder of Notes will have the right to cause the Company to repurchase all or any part of theNotes of such Holder at a purchase price in cash equal to 101% of the principal amount thereof, plus accrued and unpaidinterest and Special Interest, if any, to the date of repurchase (subject to the right of Holders of record on the relevant recorddate to receive interest due on an interest payment date that is on or prior to the date of repurchase) as provided in, and subjectto the terms of, the Indenture.

(b) In the event of an Asset Sale that requires the purchase of Notes pursuant to Section 3.7(d) of the Indenture, the Company willbe required to apply such Excess Proceeds to the repayment of the Notes and any pari passu Indebtedness in accordance withthe procedures set forth in Section 3.7 of the Indenture.

8. Denominations; Transfer; Exchange

The Notes are in registered form without coupons in denominations of principal amount of $1,000 and integral multiples of $1,000. AHolder may transfer or exchange Notes in accordance with the Indenture. The Registrar and the Trustee may require a Holder, among otherthings, to furnish appropriate endorsements or transfer documents and to pay any taxes and fees required by law or permitted by the Indenture.Neither the Issuers nor the Registrar are required to register the transfer or exchange of (i) any Notes selected for redemption (except, in thecase of a Note to be redeemed in part, the portion of the Note not to be redeemed) or (ii) any Notes for a period of 15 days before a selectionof Notes to be redeemed.

9. Persons Deemed Owners

The registered Holder of this Note may be treated as the owner of it for all purposes.

10. Unclaimed Money

If money for the payment of principal or interest remains unclaimed for one year, the Trustee or Paying Agent shall pay the money backto the Company at its request unless an abandoned property law

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designates another Person. After any such payment, Holders entitled to the money must look only to the Company and not to the Trustee forpayment.

11. Defeasance

Subject to certain conditions set forth in the Indenture, the Issuers at any time may terminate some or all of their obligations under theNotes and the Indenture if the Issuers deposit with the Trustee money or non-callable Government Securities for the payment of principal,premium, interest and Special Interest, if any, on the Notes to redemption or maturity, as the case may be.

12. Amendment, Waiver

Subject to certain exceptions set forth in the Indenture, (i) the Indenture or the Notes may be amended with the written consent orelectronic consent pursuant to the second paragraph of Section 9.4 of the Indenture, as applicable, of the Holders of at least a majority inprincipal amount of the then outstanding Notes and (ii) any default (other than with respect to nonpayment or in respect of a provision thatcannot be amended without the written consent of each Holder affected) or noncompliance with any provision may be waived with the writtenconsent or electronic consent pursuant to the second paragraph of Section 9.4 of the Indenture, as applicable, of the Holders of a majority inprincipal amount of the then outstanding Notes. Subject to certain exceptions set forth in the Indenture, without the consent of any Holder, theIssuers, the Guarantors and the Trustee may amend the Indenture or the Notes to cure any ambiguity, defect or inconsistency, or to complywith Article IV of the Indenture, or to provide for uncertificated Notes in addition to or in place of certificated Notes, or to add guaranteeswith respect to the Notes, to release a Guarantor in accordance with the Indenture or to secure the Notes, or to allow any Guarantor to executea supplemental Indenture or Note Guarantee, or to provide additional rights or benefits to the Holders of the Notes, or to comply with anyrequirement of the Commission in connection with qualifying or maintaining the qualification of the Indenture under the Act, or to make anychange that does not adversely affect the rights of any Holder, or to conform the text of the Indenture, the Notes or the Note Guarantees to thedescription of notes in the Offering Memorandum, or to provide for the issuance of Additional Notes or to evidence or provide for a successortrustee.

13. Defaults and Remedies

Under the Indenture, Events of Default include in summary form: (i) default for 30 days in payment of interest or Special Interest, if any,when due on the Notes; (ii) default in payment when due (at maturity, upon redemption or otherwise) of principal or premium, if any, on theNotes; (iii) the failure by the Company or its Restricted Subsidiaries to comply with their obligations under Sections 3.7, 3.9 or 4.1 of theIndenture; (iv) the failure by the Company or any of its Restricted Subsidiaries to comply for 60 days after notice with its other agreementscontained in the Indenture or under the Notes (other than those referred to in (i), (ii), or (iii) above); (v) default under any mortgage, indentureor instrument under which there may be issued or by which there may be secured or evidenced any Indebtedness for money borrowed by theCompany or any of its Restricted Subsidiaries (or the payment of which is guaranteed by the Company or any of its Restricted Subsidiaries),whether such Indebtedness or guarantee now exists, or is created after the Issue Date, if that default (a) is caused by a failure to pay principalof, or interest or Special Interest or premium, if any, on such Indebtedness prior to the expiration of the grace period provided in suchIndebtedness on the date of such default ("Payment Default") or (b) results in the acceleration of such Indebtedness prior to its StatedMaturity, and, in each case, the principal amount of any such Indebtedness, together with the principal amount of any other such Indebtednessunder which there has been a Payment Default or the maturity of which has been so accelerated, aggregates $25.0 million or more; (vi) failureby an Issuer or any of the Company's Restricted Subsidiaries to pay final judgments entered by a court or courts of competent jurisdictionaggregating in excess of $5.0 million, which judgments are not paid, discharged or stayed for a period of 60 days, (vii) except as permitted bythe

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Indenture, any Note Guarantee is held in a judicial proceeding to be not enforceable or valid or ceases to be in full force and effect, or anyGuarantor or other Person acting on its behalf denies or disaffirms its obligations under its Note Guarantee or (viii) certain events ofbankruptcy, insolvency or reorganization of the Company or a Restricted Subsidiary or group of Restricted Subsidiaries that, taken together(as of the latest audited consolidated financial statements for the Company and its Restricted Subsidiaries), would constitute a SignificantSubsidiary.

If an Event of Default occurs and is continuing (other than an Event of Default described in clause (vi) above), the Trustee may, or at thewritten direction of the Holders of at least 25% in aggregate principal amount of the Notes shall declare all the Notes to be due and payable.Certain events of bankruptcy or insolvency are Events of Default which will result in the Notes being due and payable immediately upon theoccurrence of such Events of Default.

Holders may not enforce the Indenture or the Notes except as provided in the Indenture. The Trustee may refuse to enforce the Indentureor the Notes unless it receives reasonable indemnity or security. Subject to certain limitations, Holders of a majority in principal amount of theNotes may direct the Trustee in its exercise of any trust or power. The Trustee may withhold from Holders notice of any continuing Default orEvent of Default (except a Default or Event of Default in payment of principal or interest) if it determines that withholding notice is in theirinterest.

14. Trustee Dealings with the Issuers

Subject to certain limitations set forth in the Indenture, the Trustee under the Indenture, in its individual or any other capacity, maybecome the owner or pledgee of Notes and may otherwise deal with and collect obligations owed to it by the Issuers or their Affiliates andmay otherwise deal with the Issuers or their Affiliates with the same rights it would have if it were not Trustee.

15. No Recourse Against Others

No manager, director, officer, employee, incorporator, member or stockholder of any Issuer, or any Guarantor, as such, shall have anyliability for any obligations of the Issuers or the Guarantors under the Notes, the Indenture, the Note Guarantees or for any claim based on, inrespect of, or by reason of, such obligations of their creation. Each Holder by accepting a Note waives and releases all such liability. Thewaiver and release are part of the consideration for issuance of the Notes.

16. Authentication

This Note shall not be valid until an authorized signatory of the Trustee (or an authenticating agent acting on its behalf) manually signsthe certificate of authentication on the other side of this Note.

17. Abbreviations

Customary abbreviations may be used in the name of a Holder or an assignee, such as TEN COM (= tenants in common), TEN ENT (=tenants by the entirety), JT TEN (= joint tenants with rights of survivorship and not as tenants in common), CUST (= custodian) and U/G/M/A(= Uniform Gift to Minors Act).

18. Additional Rights of Holders of Restricted Notes

In addition to the rights provided to Holders of Notes under the Indenture, Holders of Restricted Notes that are Initial Notes shall have allthe rights set forth in the Registration Rights Agreement, dated as of [ ], 2005, among the Company, Parent and the partiesnamed in the signature pages thereto or, in the case of Additional Notes, Holders of Restricted Notes that are Additional Notes shall have therights set forth in one or more Registration Rights Agreements, if any, among the Company and

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the other parties thereto, relating to rights given by the Company to the purchasers of such Additional Notes.

19. CUSIP Numbers

Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Issuers have causedCUSIP numbers to be printed on the Notes and have directed the Trustee to use CUSIP numbers in notices of redemption as a convenience toHolders. No representation is made as to the accuracy of such numbers either as printed on the Notes or as contained in any notice ofredemption and reliance may be placed only on the other identification numbers placed thereon.

20. Governing Law

This Note shall be governed by, and construed in accordance with, the laws of the State of New York.

The Issuers will furnish to any Holder upon written request and without charge to the Holder a copy of the Indenture, which has in it thetext of this Note in larger type. Requests may be made to:

Tronox Worldwide LLC123 Robert S. Kerr AvenueOklahoma City, Oklahoma 73102

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ASSIGNMENT FORM

To assign this Note, fill in the form below:

I or we assign and transfer this Note to

(Print or type assignee's name, address and zip code)

(Insert assignee's soc. see. or tax I.D. No.)

and irrevocably appoint agent to transfer this Note on the books of the Issuers. The agent may substitute another to act for him.

Date:Your Signature:

Signature Guarantee:

(Signature must be guaranteed)

Sign exactly as your name appears on the other side of this Note.

The signatures) should be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unionswith membership in an approved signature guarantee medallion program), pursuant to Commission Rule 17Ad-15.

In connection with any transfer or exchange of any of the Notes evidenced by this certificate occurring prior to the date that is two yearsafter the later of the date of original issuance of such Notes and the last date, if any, on which such Notes were owned by an Issuer or anyAffiliate of an Issuer, the undersigned confirms that such Notes are being:

CHECK ONE BOX BELOW:

1 o acquired for the undersigned's own account, without transfer; or

2 o transferred to the Company; or

3 o transferred pursuant to and in compliance with Rule 144A under the Securities Act of 1933, as amended (the "SecuritiesAct"); or

4 o transferred pursuant to an effective registration statement under the Securities Act; or



5 o transferred pursuant to and in compliance with Regulation S under the Securities Act; or

6 o transferred pursuant to another available exemption from the registration requirements of the Securities Act of 1933.

Unless one of the boxes is checked, the Trustee will refuse to register any of the Notes evidenced by this certificate in the name of any personother than the registered Holder thereof; provided, however, that if box (5) or (6) is checked, the Trustee or the Issuers may require, prior toregistering any such transfer of the Notes, in their sole discretion, such legal opinions, certifications and other information as the Trustee or theIssuers may reasonably request to confirm that such transfer is being made pursuant to an

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exemption from, or in a transaction not subject to, the registration requirements of the Securities Act of 1933, such as the exemption providedby Rule 144 under such Act.

Signature


(Signature must be guaranteed) Signature

The signature(s) should be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and creditunions with membership in an approved signature guarantee medallion program), pursuant to Commission Rule 17Ad-15.

TO BE COMPLETED BY PURCHASER IF (1) OR (3) ABOVE IS CHECKED.

The undersigned represents and warrants that it is purchasing this Note for its own account or an account with respect to which itexercises sole investment discretion and that it and any such account is a "qualified institutional buyer" within the meaning of Rule 144Aunder the Securities Act of 1933, as amended, and is aware that the sale to it is being made in reliance on Rule 144A and acknowledges that ithas received such information regarding the Issuers as the undersigned has requested pursuant to Rule 144A or has determined not to requestsuch information and that it is aware that the transferor is relying upon the undersigned's foregoing representations in order to claim theexemption from registration provided by Rule 144A.

Dated:

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OPTION OF HOLDER TO ELECT PURCHASE

If you want to elect to have this Note purchased by the Issuers pursuant to Section 3.7 or Section 3.9 of the Indenture, check either box:

o

3.7o

3.9

If you want to elect to have only part of this Note purchased by the Issuers pursuant to Section 3.7 or Section 3.9 of the Indenture, statethe amount in principal amount (must be integral multiple of $1,000): $

Date: Your Signature(Sign exactly as your name appears on the other side of the Note)


(Signature must be guaranteed)


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SCHEDULE OF INCREASES OR DECREASES IN GLOBAL NOTE1

The following increases or decreases in this Global Note have been made:

Date of

Exchange

Amount of

decrease in

Principal

Amount of this

Global Note

Amount of

increase in

Principal

Amount of this

Global Note

Principal Amount of

this Global Note

following such

decrease or increase

Signature of

authorized signatory

of Trustee or Notes

Custodian

(1) Include only if security is issued in global form.

A-14



EXHIBIT B

[FORM OF FACE OF EXCHANGE NOTE]

[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUSTCOMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW YORK, TO THE COMPANY OR ITS AGENT FORREGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAMEOF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANYPAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZEDREPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TOANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OFDTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBALNOTE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THEINDENTURE REFERRED TO ON THE REVERSE HEREOF.]

B-1



No. [ ]Principal Amount $[ ]

CUSIP NO. [ ]

TRONOX WORLDWIDE LLCTRONOX FINANCE CORP.

% Senior Note due 2012

Tronox Worldwide LLC, a Delaware limited liability company (the "Company"), and Tronox Finance Corp., a Delaware corporation("Tronox Finance" and, together with the Company, the "Issuers"), promise to pay to , or registered assigns, the principal sum of[ ] Dollars or such greater or lesser amount as shall be reflected on the books and records of the custodian with respect to theGlobal Note (as appointed by DTC) (the "Notes Custodian")2, on [ ], 2012.

Interest Payment Dates: [ ] and [ ]

Record Dates: [ ] and [ ]

Additional provisions of this Note are set forth on the other side of this Note.

2 Global Note only

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In witness whereof, the Issuers have caused this instrument to be duly executed.


By: Name:Title:


By: Name:Title:

TRUSTEE'S CERTIFICATEOF AUTHENTICATION

Citibank, N.A., not in its individualcapacity but solely as Trustee,certifies that this isone of the Notes referredto in the Indenture.

By: Authorized Signatory Date:

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[FORM OF REVERSE SIDE OF NOTE]


1. Interest

Tronox Worldwide LLC, a Delaware limited liability company (the "Company"), and Tronox Finance Corp., a Delaware corporation("Tronox Finance" and, together with the Company, the "Issuers"), promise to pay interest on the principal amount of this Note at the rate perannum shown above.

The Issuers will pay interest semiannually in arrears in cash on [ ] and [ ] of each year or if any such day is not a businessday, on the next succeeding business day (each an "Interest Payment Date") commencing on [ ], 2006 and will pay Special Interest, ifany, as provided in the Registration Rights Agreement relating to these Notes. Interest on the Notes will accrue from the most recent date towhich interest has been paid on the Notes or, if no interest has been paid, from and including [ ], 2005. The Issuers shall pay interest onoverdue principal and interest and Special Interest, if any, from time to time at a rate that is 1% per annum higher than the interest rate then ineffect under the Indenture and this Note. Interest will be computed on the basis of a 360-day year of twelve 30-day months.

2. Method of Payment

By no later than 11:00 a.m. (New York City time) on the date on which any principal of, interest and premium and Special Interest, ifany, on, any Note is due and payable, the Issuers shall deposit with the Trustee or the Paying Agent money sufficient to pay such principal,interest and premium and Special Interest, if any. The Issuers will pay principal, interest (except Defaulted Interest) and premium and SpecialInterest, if any, to the Persons who are registered Holders of Notes at the close of business on [ ] or [ ] preceding the InterestPayment Date, even if Notes are cancelled, repurchased or redeemed after the record date and on or before the Interest Payment Date. Holdersmust surrender Notes to a Paying Agent to collect principal payments. The Issuers will pay principal, interest and premium and SpecialInterest, if any, in money of the United States that at the time of payment is legal tender for payment of public and private debts Payments ofall principal, interest and premium and Special Interest, if any, on the Notes will be made to each registered Holder by wire transfer inimmediately available funds if that Holder has given to the Issuers, through the Paying Agent or otherwise, wire instructions at least fivebusiness days prior to the applicable payment date or by check mailed to the address of the Holder as it appears on the books of the registrar ifthe Holder has not provided wire instructions; provided that the final distribution in respect of any Note will be made only upon presentationand surrender of such Note at the applicable Corporate Trust Office of the Trustee.

3. Paying Agent and Registrar

Initially, Citibank, N.A. (the "Trustee"), will act as Trustee, Paying Agent and Registrar. The Issuers may appoint and change any PayingAgent, Registrar or co-registrar without prior notice to any Holder of the Notes. The Issuers or any of their Subsidiaries may act as PayingAgent, Registrar or co-registrar.

4. Indenture

The Issuers issued the Notes under an Indenture dated as of November , 2005 (as it may be amended or supplemented from time to timein accordance with the terms thereof, the "Indenture"), among the Issuers, the Guarantors party thereto and the Trustee. The terms of the Notesinclude those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C. §§77aaa-77bbbb) as in effect on the Issue Date (the "Act"). Capitalized terms used herein and not defined herein have the meanings ascribedthereto in the Indenture. The Notes are subject to all terms in the Indenture, and Holders are referred to the Indenture and the Act for a



statement of those terms. To the extent any provision of this Note conflicts with the express provisions of the Indenture, the provisions of theIndenture shall govern and be controlling.

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The Notes are general unsecured senior obligations of the Issuers. The aggregate principal amount of Notes that may be authenticated anddelivered under the Indenture is limited to an aggregate principal amount at maturity of $350,000,000, subject to the Issuers' ability to issueAdditional Notes. The Indenture imposes certain limitations, among other things, on the ability of the Issuers and their Restricted Subsidiariesto make Investments; incur additional Indebtedness or issue Preferred Stock; create certain Liens; sell assets; enter into agreements that restrictdividends or other payments from the Restricted Subsidiaries; consolidate, merge or transfer all or substantially all of the assets of the Issuersand their Restricted Subsidiaries; engage in transactions with Affiliates; pay dividends or make other distributions on Capital Stock orsubordinated Indebtedness; enter into different lines of business; create Unrestricted Subsidiaries; and enter into sale and leasebacktransactions.

To guarantee the due and punctual payment of the principal of, interest and premium and Special Interest, if any, on, the Notes and allother amounts payable by the Issuers under the Indenture and the Notes when and as the same shall be due and payable, whether at maturity,by acceleration or otherwise, according to the terms of the Notes and the Indenture, the Guarantors have unconditionally guaranteed (andfuture Guarantors, together with the Guarantors, will unconditionally guarantee), jointly and severally, such obligations pursuant to the termsof the Indenture.

5. Redemption

Except as forth below, the Notes will not be redeemable at the option of the Issuers prior to [ ], 2009. On and after such date, theNotes will be redeemable, at the Issuers' option, in whole or in part, at any time upon not less than 30 nor more than 60 days prior noticemailed by first-class mail to each Holder's registered address, at the following redemption prices (expressed in percentages of principalamount), plus accrued and unpaid interest and Special Interest, if any, thereon, if any, to the Redemption Date (subject to the right of Holdersof record on the relevant record date to receive interest due on an interest payment date that is on or prior to the Redemption Date) if redeemedduring the 12-month period commencing on [ ] of the years indicated below, subject to the rights of Holders of Notes on the relevantrecord date to receive interest due on the relevant Interest Payment Date:

PeriodRedemption

Price

2009 %2010 %2011 and thereafter 100.000%

In addition, at any time and from time to time prior to [ ], 2008, the Issuers may redeem up to 35% of the aggregate principalamount of the Notes (calculated after giving effect to any issuance of Additional Notes) at a redemption price of [ ]% of the principalamount plus accrued and unpaid interest and Special Interest, if any, to the Redemption Date, with the net cash proceeds of one or moreEquity Offerings; provided, that (1) at least 65% of the aggregate principal amount of the Notes, calculated after giving effect to any issuanceof Additional Notes, originally issued under the Indenture (including Notes held by Parent, any Issuer and their Subsidiaries) remainsoutstanding after each such redemption and (2) each such redemption occurs within 90 days of the date of closing of such Equity Offering.

Notice of any redemption upon an Equity Offering may be given prior to the completion of the related Equity Offering, and any suchredemption or notice may, at the Issuers' discretion, be subject to one or more conditions precedent, including completion of the related EquityOffering.

If the optional Redemption Date is on or after an interest record date and on or before the related interest payment date, the accrued andunpaid interest and Special Interest, if any, will be paid to the Person in whose name the Note is registered at the close of business on suchrecord date, and no Special Interest will be payable to Holders whose Notes will be subject to redemption by the Issuers.

B-5



In the case of any partial redemption, selection of the Notes for redemption will be made by the Trustee in compliance with therequirements of the principal national securities exchange, if any, on which the Notes are listed or, if the Notes are not listed, then on a prorata basis, although no Notes of $1,000 in original principal amount or less will be redeemed in part. If any Note is to be redeemed in partonly, the notice of redemption relating to such Note shall state the portion of the principal amount thereof to be redeemed. A new Note inprincipal amount equal to the unredeemed portion thereof will be issued in the name of the Holder thereof upon cancellation of the originalNote. On and after the Redemption Date, interest will cease to accrue on Notes or portions thereof called for redemption as long as the Issuershave deposited with the Paying Agent funds in satisfaction of the applicable redemption price pursuant to the Indenture.

6. Mandatory Redemption

The Issuers are not required to make mandatory redemption or sinking fund payments with respect to the Notes. However, the Issuersmay be required to offer to repurchase the Notes under Sections 3.7 and 3.9 of the Indenture.

7. Repurchase Provisions

(a) Upon a Change of Control any Holder of Notes will have the right to cause the Company to repurchase all or any part of the Notes ofsuch Holder at a purchase price in cash equal to 101% of the principal amount thereof, plus accrued and unpaid interest and SpecialInterest, if any, to the date of repurchase (subject to the right of Holders of record on the relevant record date to receive interest due onan interest payment date that is on or prior to the date of repurchase) as provided in, and subject to the terms of, the Indenture.

(b) In the event of an Asset Sale that requires the purchase of Notes pursuant to Section 3.7(d) of the Indenture, the Company will berequired to apply such Excess Proceeds to the repayment of the Notes and any pari passu Indebtedness in accordance with theprocedures set forth in Section 3.7 of the Indenture.

8. Denominations; Transfer; Exchange

The Notes are in registered form without coupons in denominations of principal amount of $1,000 and integral multiples of $1,000. AHolder may transfer or exchange Notes in accordance with the Indenture. The Registrar and the Trustee may require a Holder, among otherthings, to furnish appropriate endorsements or transfer documents and to pay any taxes and fees required by law or permitted by the Indenture.Neither the Issuers nor the Registrar are required to register the transfer or exchange of (i) any Notes selected for redemption (except, in thecase of a Note to be redeemed in part, the portion of the Note not to be redeemed) or (ii) any Notes for a period of 15 days before a selectionof Notes to be redeemed.

9. Persons Deemed Owners

The registered Holder of this Note may be treated as the owner of it for all purposes.

10. Unclaimed Money

If money for the payment of principal or interest remains unclaimed for one year, the Trustee or Paying Agent shall pay the money backto the Company at its request unless an abandoned property law designates another Person. After any such payment, Holders entitled to themoney must look only to the Company and not to the Trustee for payment.

11. Defeasance



Subject to certain conditions set forth in the Indenture, the Issuers at any time may terminate some or all of their obligations under theNotes and the Indenture if the Issuers deposit with the Trustee money or

B-6



non-callable Government Securities for the payment of principal, premium, interest and Special Interest, if any, on the Notes to redemption ormaturity, as the case may be.

12. Amendment, Waiver

Subject to certain exceptions set forth in the Indenture, (i) the Indenture or the Notes may be amended with the written consent orelectronic consent pursuant to the second paragraph of Section 9.4 of the Indenture, as applicable, of the Holders of at least a majority inprincipal amount of the then outstanding Notes and (ii) any default (other than with respect to nonpayment or in respect of a provision thatcannot be amended without the written consent of each Holder affected) or noncompliance with any provision may be waived with the writtenconsent or electronic consent pursuant to the second paragraph of Section 9.4 of the Indenture, as applicable, of the Holders of a majority inprincipal amount of the then outstanding Notes. Subject to certain exceptions set forth in the Indenture, without the consent of any Holder, theIssuers, the Guarantors and the Trustee may amend the Indenture or the Notes to cure any ambiguity, defect or inconsistency, or to complywith Article IV of the Indenture, or to provide for uncertificated Notes in addition to or in place of certificated Notes, or to add guaranteeswith respect to the Notes, to release a Guarantor in accordance with the Indenture or to secure the Notes, or to allow any Guarantor to executea supplemental Indenture or Note Guarantee, or to provide additional rights or benefits to the Holders of the Notes, or to comply with anyrequirement of the Commission in connection with qualifying or maintaining the qualification of the Indenture under the Act, or to make anychange that does not adversely affect the rights of any Holder, or to conform the text of the Indenture, the Notes or the Note Guarantees to thedescription of notes in the Offering Memorandum, or to provide for the issuance of Additional Notes or to evidence or provide for a successortrustee.

13. Defaults and Remedies

Under the Indenture, Events of Default include in summary form: (i) default for 30 days in payment of interest or Special Interest, if any,when due on the Notes; (ii) default in payment when due (at maturity, upon redemption or otherwise) of principal or premium, if any, on theNotes; (iii) the failure by the Company or its Restricted Subsidiaries to comply with their obligations under Sections 3.7, 3.9 or 4.1 of theIndenture; (iv) the failure by the Company or any of its Restricted Subsidiaries to comply for 60 days after notice with its other agreementscontained in the Indenture or under the Notes (other than those referred to in (i), (ii), or (iii) above); (v) default under any mortgage, indentureor instrument under which there may be issued or by which there may be secured or evidenced any Indebtedness for money borrowed by theCompany or any of its Restricted Subsidiaries (or the payment of which is guaranteed by the Company or any of its Restricted Subsidiaries),whether such Indebtedness or guarantee now exists, or is created after the Issue Date, if that default (a) is caused by a failure to pay principalof, or interest or Special Interest or premium, if any, on such Indebtedness prior to the expiration of the grace period provided in suchIndebtedness on the date of such default ("Payment Default") or (b) results in the acceleration of such Indebtedness prior to its StatedMaturity, and, in each case, the principal amount of any such Indebtedness, together with the principal amount of any other such Indebtednessunder which there has been a Payment Default or the maturity of which has been so accelerated, aggregates $25.0 million or more; (vi) failureby an Issuer or any of the Company's Restricted Subsidiaries to pay final judgments entered by a court or courts of competent jurisdictionaggregating in excess of $5.0 million, which judgments are not paid, discharged or stayed for a period of 60 days, (vii) except as permitted bythe Indenture, any Note Guarantee is held in a judicial proceeding to be not enforceable or valid or ceases to be in full force and effect, or anyGuarantor or other Person acting on its behalf denies or disaffirms its obligations under its Note Guarantee or (viii) certain events ofbankruptcy, insolvency or reorganization of the Company or a Restricted Subsidiary or group of Restricted Subsidiaries that, taken together(as of the latest audited consolidated financial statements for the Company and its Restricted Subsidiaries), would constitute a SignificantSubsidiary.

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If an Event of Default occurs and is continuing (other than an Event of Default described in clause (vi) above), the Trustee may, or at thewritten direction of the Holders of at least 25% in aggregate principal amount of the Notes shall declare all the Notes to be due and payable.Certain events of bankruptcy or insolvency are Events of Default which will result in the Notes being due and payable immediately upon theoccurrence of such Events of Default.

Holders may not enforce the Indenture or the Notes except as provided in the Indenture. The Trustee may refuse to enforce the Indentureor the Notes unless it receives reasonable indemnity or security. Subject to certain limitations, Holders of a majority in principal amount of theNotes may direct the Trustee in its exercise of any trust or power. The Trustee may withhold from Holders notice of any continuing Default orEvent of Default (except a Default or Event of Default in payment of principal or interest) if it determines that withholding notice is in theirinterest.

14. Trustee Dealings with the Issuers

Subject to certain limitations set forth in the Indenture, the Trustee under the Indenture, in its individual or any other capacity, maybecome the owner or pledgee of Notes and may otherwise deal with and collect obligations owed to it by the Issuers or their Affiliates andmay otherwise deal with the Issuers or their Affiliates with the same rights it would have if it were not Trustee.

15. No Recourse Against Others

No manager, director, officer, employee, incorporator, member or stockholder of any Issuer, or any Guarantor, as such, shall have anyliability for any obligations of the Issuers or the Guarantors under the Notes, the Indenture, the Note Guarantees or for any claim based on, inrespect of, or by reason of, such obligations of their creation. Each Holder by accepting a Note waives and releases all such liability. Thewaiver and release are part of the consideration for issuance of the Notes.

16. Authentication

This Note shall not be valid until an authorized signatory of the Trustee (or an authenticating agent acting on its behalf) manually signsthe certificate of authentication on the other side of this Note.

17. Abbreviations

Customary abbreviations may be used in the name of a Holder or an assignee, such as TEN COM (=tenants in common), TEN ENT(=tenants by the entirety), JT TEN (=joint tenants with rights of survivorship and not as tenants in common), CUST (=custodian) and U/G/M/A (=Uniform Gift to Minors Act).

18. CUSIP Numbers

Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Issuers have causedCUSIP numbers to be printed on the Notes and have directed the Trustee to use CUSIP numbers in notices of redemption as a convenience toHolders. No representation is made as to the accuracy of such numbers either as printed on the Notes or as contained in any notice ofredemption and reliance may be placed only on the other identification numbers placed thereon.

19. Governing Law

This Note shall be governed by, and construed in accordance with, the laws of the State of New York.

The Issuers will furnish to any Holder upon written request and without charge to the Holder a copy of the Indenture, which has in it thetext of this Note in larger type. Requests may be made to:



Tronox Worldwide LLC123 Robert S. Kerr AvenueOklahoma City, Oklahoma 73102

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ASSIGNMENT FORM

To assign this Note, fill in the form below:

I or we assign and transfer this Note to

(Print or type assignee's name, address and zip code)

(Insert assignee's soc. see. or tax I.D. No.)

and irrevocably appoint agent to transfer this Note on the books of the Issuers. The agent may substitute another to act for him.

Date: Your Signature:

Signature Guarantee: (Signature must be guaranteed)

Sign exactly as your name appears on the other side of this Note.

The signatures) should be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unionswith membership in an approved signature guarantee medallion program), pursuant to Commission Rule 17Ad-15.

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OPTION OF HOLDER TO ELECT PURCHASE

If you want to elect to have this Note purchased by the Issuers pursuant to Section 3.7 or Section 3.9 of the Indenture, check either box:

o o

3.7 3.9

If you want to elect to have only part of this Note purchased by the Issuers pursuant to Section 3.7 or Section 3.9 of the Indenture, statethe amount in principal amount (must be integral multiple of $1,000):$

Date: Your Signature(Sign exactly as your name appears on the other side of the Note)

Signature Guarantee:(Signature must be guaranteed)


B-10



SCHEDULE OF INCREASES OR DECREASES IN GLOBAL NOTE1

The following increases or decreases in this Global Note have been made:

Date of

Exchange

Amount of decrease in

Principal Amount of

this Global Note

Amount of increase in

Principal Amount of

this Global Note

Principal Amount of this

Global

Note following such

decrease or

increase

Signature of authorized

signatory of Trustee or

Notes Custodian

1Include only if security is issued in global form.

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EXHIBIT C

FORM OF SUPPLEMENTAL INDENTURE

This Supplemental Indenture, dated as of (this "Supplemental Indenture" or "Note Guarantee"), among [name of futureGuarantor] (the "New Guarantor"), Tronox Worldwide LLC (the "Company"), Tronox Finance Corp. ("Tronox Finance" and, together withthe Company, the "Issuers"), Tronox Incorporated ("Parent") and Citibank, N.A., as Trustee under the Indenture referred to below.

W I T N E S S E T H:

WHEREAS, the Issuers, the Guarantors named therein and the Trustee have heretofore executed and delivered an Indenture, dated as ofNovember , 2005 (as amended, supplemented, waived or otherwise modified, the "Indenture"), providing for the initial issuance of anaggregate principal amount of $350,000,000 of % Senior Notes due 2012 of the Issuers (the "Notes");

WHEREAS, Section 3.10 of the Indenture provides that the Issuers are is required to cause each wholly-owned Domestic Subsidiary(other than Immaterial Subsidiaries) created or acquired by the Company or any of its Restricted Subsidiaries after the Issue Date, to the extentset forth in the Indenture, to execute and deliver to the Trustee a Note Guarantee pursuant to which such Guarantor will unconditionallyGuarantee, on a joint and several basis with the other Guarantors, the full and prompt payment of the principal of, premium, interest andSpecial Interest, if any, on the Notes on a senior basis; and

WHEREAS, pursuant to Section 9.1 of the Indenture, the Trustee, the Issuers and the Guarantors are authorized to execute and deliverthis Supplemental Indenture to amend the Indenture, without the consent of any Holder,

NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is herebyacknowledged, the New Guarantor, the Issuers, the Guarantors and the Trustee mutually covenant and agree for the equal and ratable benefitof the Holders of the Notes as follows:

ARTICLE I

Definitions

SECTION 1.1 Defined Terms. As used in this Note Guarantee, terms defined in the Indenture or in the preamble or recital hereto areused herein as therein defined, except that the term "Holders" in this Note Guarantee shall refer to the term "Holders" as defined in theIndenture and the Trustee acting on behalf or for the benefit of such Holders. The words "herein," "hereof' and "hereby" and other words ofsimilar import used in this Supplemental Indenture refer to this Supplemental Indenture as a whole and not to any particular section hereof.

ARTICLE II

Agreement to be Bound, Note Guarantee

SECTION 2.1 Agreement to be Bound. The New Guarantor hereby becomes a party to the Indenture as a Guarantor and as such willhave all of the rights and be subject to all of the obligations and agreements of a Guarantor under the Indenture. The New Guarantor agrees tobe bound by all of the provisions of the Indenture applicable to a Guarantor and to perform all of the obligations and agreements of aGuarantor under the Indenture.

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SECTION 2.2 Note Guarantee. The New Guarantor hereby fully, unconditionally and irrevocably Guarantees, as primary obligor andnot merely as surety, jointly and severally with each Guarantor, to each Holder of the Notes and the Trustee, the full and punctual paymentwhen due, whether at maturity, by acceleration, by redemption or otherwise, of the Obligations pursuant to Article X of the Indenture on asenior basis.

ARTICLE III

Miscellaneous

SECTION 3.1 Notices. All notices and other communications to the New Guarantor shall be given as provided in the Indenture to theGuarantors, at its address set forth below, with a copy to the Issuers as provided in the Indenture for notices to the Company.

SECTION 3.2 Parties. Nothing expressed or mentioned herein is intended or shall be construed to give any Person, firm orcorporation, other than the Holders and the Trustee, any legal or equitable right, remedy or claim under or in respect of this SupplementalIndenture or the Indenture or any provision herein or therein contained.

SECTION 3.3 Governing Law. This Supplemental Indenture shall be governed by, and construed in accordance with, the laws of theState of New York.

SECTION 3.4 Severability Clause. In case any provision in this Supplemental Indenture shall be invalid, illegal or unenforceable, thevalidity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby and such provision shallbe ineffective only to the extent of such invalidity, illegality or unenforceability.

SECTION 3.5 Ratification of Indenture; Supplemental Indenture Part of Indenture. Except as expressly amended hereby, theIndenture is in all respects ratified and confirmed and all the terms, conditions and provisions thereof shall remain in full force and effect. ThisSupplemental Indenture shall form a part of the Indenture for all purposes, and every Holder of Notes heretofore or hereafter authenticated anddelivered shall be bound hereby. The Trustee makes no representation or warranty as to the validity or sufficiency of this SupplementalIndenture.

SECTION 3.6 Counterparts. The parties hereto may sign one or more copies of this Supplemental Indenture in counterparts, all ofwhich together shall constitute one and the same agreement.

SECTION 3.7 Headings. The headings of the Articles and the sections in this Note Guarantee are for convenience of reference onlyand shall not be deemed to alter or affect the meaning or interpretation of any provisions hereof.

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IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed as of the date first abovewritten.

[NEW GUARANTOR],as a Guarantor

By: Name:Title:

CITIBANK, N.A., as Trustee

By: Name:Title:


By: Name:Title:


By: Name:Title:

TRONOX INCORPORATED

By: Name:Title:

[INSERT SIGNATURE BLOCKS FOROTHER GUARANTORS]

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EXHIBIT 10.11ARTICLE II The NotesARTICLE III CovenantsARTICLE IV Successor CompanyARTICLE V Redemption of NotesARTICLE VI Defaults and RemediesARTICLE VII TrusteeARTICLE VIII Legal Defeasance and Covenant DefeasanceARTICLE IX AmendmentsARTICLE X Note GuaranteeARTICLE XI Satisfaction and DischargeEXHIBIT ATRONOX WORLDWIDE LLC TRONOX FINANCE CORP. [ ]% Senior Note due 2012[FORM OF REVERSE SIDE OF NOTE] [ ]% Senior Note due 2012ASSIGNMENT FORMOPTION OF HOLDER TO ELECT PURCHASESCHEDULE OF INCREASES OR DECREASES IN GLOBAL NOTE1

EXHIBIT B [FORM OF FACE OF EXCHANGE NOTE]TRONOX WORLDWIDE LLC TRONOX FINANCE CORP. % Senior Note due 2012[FORM OF REVERSE SIDE OF NOTE] [ ]% Senior Note due 2012ASSIGNMENT FORMOPTION OF HOLDER TO ELECT PURCHASESCHEDULE OF INCREASES OR DECREASES IN GLOBAL NOTE1

EXHIBIT CFORM OF SUPPLEMENTAL INDENTUREW I T N E S S E T HARTICLE I DefinitionsARTICLE II Agreement to be Bound, Note GuaranteeARTICLE III Miscellaneous




EXHIBIT 21.1

Tronox IncorporatedSubsidiary Companies

Name of SubsidiaryState or Country of Incorporation or

Formation

Tronox LLC Delaware, United StatesTronox Worldwide LLC Delaware, United StatesKerr-McGee Pigments (Holland) B.V. The NetherlandsKerr-McGee Pigments International GmbH SwitzerlandKerr-McGee Pigments (Savannah), Inc. Georgia, United StatesKMCC Western Australia Pty. Ltd. Western Australia, AustraliaKerr-McGee Pigments GmbH GermanyKerr-McGee Chemical GmbH GermanyKerr-McGee Finance (Curacao) N.V. Netherlands AntillesKerr-McGee Pigments N.V. BelgiumKerr-McGee Pigments Ltd BahamasKerr-McGee Holdings, Inc. Delaware, United StatesKerr-McGee Luxembourg S.a.r.l LuxembourgKerr-McGee Pigments (Netherlands) B.V. The NetherlandsKerr-McGee (Luxembourg) Holding S.a.r.l LuxembourgKerr-McGee (Switzerland) Holding GmbH SwitzerlandKM Denmark International ApS DenmarkKerr-McGee International ApS Denmark

A number of additional subsidiaries are omitted since, considered in the aggregate as a single subsidiary, they would not constitute asignificant subsidiary as of December 31, 2004.



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EXHIBIT 21.1




EXHIBIT 23.2

Consent of Independent Registered Public Accounting Firm

We consent to the reference to our firm under the caption "Experts" and to the use of our report dated June 3, 2005, in Amendment No. 5 toRegistration Statement (Form S-1 No. 333-125574) and related Prospectus of Tronox Incorporated for the registration of shares of its Class Acommon stock.

/s/ Ernst & Young LLP

Oklahoma City, OklahomaNovember 17, 2005



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EXHIBIT 23.2Consent of Independent Registered Public Accounting Firm



[Covington & Burling Letterhead]

November 18, 2005

Ms. Pamela A. LongAssistant DirectorDivision of Corporation FinanceUnited States Securities and Exchange Commission100 F Street, NEWashington, DC 20549-7010Mail Stop 7010

Re:

Tronox IncorporatedAmendment No. 5 to the Registration Statement on Form S-1Filed November 17, 2005File No. 333-125574

Dear Ms. Long:

On behalf of Tronox Incorporated, a Delaware corporation (the "Registrant"), we hereby submit for filing by direct electronictransmission under the Securities Act of 1933, Pre-Effective Amendment No. 5 ("Amendment No. 5") to the Registrant's registrationstatement on Form S-1, File No. 333-125574. In addition, we will provide a marked copy showing changes from the previous amendment tothe registration statement for your convenience.

We are providing the following responses to the comment letter dated November 16, 2005 from the staff (the "Staff") of the Securitiesand Exchange Commission (the "Commission") regarding the Registrant's previous amendment to the registration statement. The responsesset forth below are numbered to correspond to the numbered comments in the Staff's comment letter, which have been reproduced here forease of reference. Please note that all page numbers in our responses refer to Amendment No. 5.

1. Please delete the reference to Lehman Brothers and J.P. Morgan as "Joint Book Running-Managers" on the front cover page ofyour prospectus. Also, please delete the references to "senior co-managers" and "co-managers."

The Registrant has revised the cover page of the prospectus to delete the reference to "Joint Book Running-Managers," "Senior Co-Managers" and "Co-Managers."

2. We note your response to comment 13 of our letter dated July 1, 2005, as well as the disclosure appearing in Summary Historicaland Pro Forma Combined Financial Data of Amendment No. 4. Revise your summary discussion of the offering to disclose theaggregate value of the transaction to Kerr-McGee, including your transfer of "cash on hand in excess of $40 million."

The Registrant has revised the disclosure in "The Offering" and "Use of Proceeds" sections of the registration statement to disclose theaggregate value of the transaction to Kerr-McGee.

3. You state in footnote 4 on page 13 that cash flows from operating activities were reduced by $165 million related to therepurchase of previously sold accounts receivable. Our understanding is that the termination of the accounts receivablemonetization program resulted in a one-time reduction in cash flows from operations of up to $165 million from the date oftermination until you began collecting on post-termination accounts receivable. It appears that the time lag in collectionsresulting from the program termination contributed to the decrease in cash flows from operations. Please revise your disclosureson pages 13 and 60 to clarify how cash flows from operating activities were affected by the termination of the accounts receivablemonetization program.



The Registrant has revised its disclosure to clarify how cash flows from operating activities were affected by the termination of theaccounts receivable monetization program.



4. We note your response to comment 4 in our letter dated November 7, 2005. Please revise to give investors a sense for thelikelihood of the risk that you disclose in the paragraph following the bullet points. For example, what leads you to believe thatone or more of your key raw materials may be found to have toxicological or health-related impacts on the environment,customers, or employees? In that regard, we reissue comment 4.

The Registrant has revised the risk factor to clarify that it is not aware currently of the presence of any of the hazards it describes in theparagraph that follows the bullet points.

5. Please disclose the types of selling, general and administrative costs included in pro forma adjustment one.

The Registrant has revised the disclosure in the "Unaudited Pro Forma Combined Financial Statements" to disclose the types of selling,general and administrative costs included in pro forma adjustment one.

6. Please revise to present the pro forma adjustments related to the receipt and use of offering proceeds in a separate column fromyour other pro forma adjustments.

The Registrant has revised the registration statement to present the pro forma adjustments related to the receipt and use of offeringproceeds from the sale of the Class A Common Stock in a separate column from its other pro forma adjustments.

7. Please revise the descriptions of pro forma adjustments two and three to show the computation of each adjustment, including theinterest rates used for each debt instrument. If true, please confirm that interest expense is based on current rates. Please alsoensure that the final terms of the debt agreements are reflected in these adjustments and elsewhere in the document, includingdiscussion of your debt covenants.

The Registrant has revised its descriptions of pro forma adjustments two and three to show computation of each adjustment, including theinterest rates used for each debt instrument. The Registrant confirms that the interest expense is based on current rates and that theseadjustments, as well as the discussion of the debt covenants elsewhere in the registration statement, are consistent with the expected finalterms of the debt.

8. Please note that it is appropriate to give pro forma effect to the elimination of interest associated with historical amount due toKerr-McGee only to the extent that is eliminated by the pro forma transactions. Further, your pro forma adjustment toeliminate interest, calculated based on the amount due to Kerr-McGee as of a recent date, may require downward adjustmentunless the recent amount due is less than the amount due at any date during the periods presented.

The Registrant acknowledges the Staff's comment and has revised the Unaudited Condensed Combined Statement of Operations includedin the registration statement to reflect the elimination of interest expense reflected in historical combined financial statements only to theextent that it is eliminated by the pro forma transactions.

9. Please revise the description of pro forma adjustment 13 to disclose the assumptions used to determine the plan obligation of$442.3 million.

The Registrant has revised the description of pro forma adjustments 12 and 13 to disclose the assumptions used to determine theretirement and post-retirement plan obligations expected to be assumed by the Registrant.

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10. Please delete the last sentence of the first paragraph under the heading "Overview" on page 44, as it refers to the deletedreconciliation of adjusted EBITDA to operating cash flows.

The Registrant has revised the inapplicable portion of the last sentence of the first paragraph under the heading "Overview" to makereference to a reconciliation of adjusted EBITDA to net income (loss).

11. Please consider adding a risk factor related to your underfunded U.S. retirement benefit plan. We note your revised disclosurethat you anticipate your plan will now be underfunded by approximately $14.4 million.

The Registrant respectfully submits that it has considered the Staff's comment and concluded that the underfunding of the U.S. retirementplan does not constitute a material risk. The amount of the underfunding, $14.4 million, is not material to the Registrant. In addition, noadditional contributions will be required to be made under ERISA, and the underfunding is not expected to have a material impact on theRegistrant's assets, liabilities or income. Based on these conclusions, the Registrant submits that this is not a significant risk.

12. Please describe any registration rights which will inure to the purchasers of the unsecured notes. If registration rights areattached to the notes, disclose who will bear the cost of registration.

The Registrant has revised the description of the unsecured notes to describe the registration rights of the purchasers of the notes,including the fact that the issuers and guarantors of the unsecured notes will bear the cost of registration.

13. Has the board adopted the rights plan? If so, please revise your disclosure.

The Registrant has revised the registration statement to disclose the fact that its board of directors has approved the form of rights plan,which, after being priced by its pricing committee, will be effective prior to the closing of the offering.

14. Please clarify who will receive the proceeds when holders of the rights exercise their rights to purchase.

The Registrant has revised the registration statement to clarify that it will receive the proceeds when holders of the rights exercise theirrights to purchase.

15. Disclose the class that each board member will belong to upon consummation of the offering.

The Registrant has revised the disclosure in its "Description of Capital Stock" to provide a cross-reference to its disclosure under the sub-heading, "Board of Directors," which discloses the class to which each director will belong upon consummation of the offering.

16. Please disclose the non-cash financing activity related to the receivables repurchase, below the related non-cash investing activityon the face of your interim statement of cash flows.

The Registrant has revised the Condensed Combined Statement of Cash Flows for the nine months ended September 30, 2005 to disclosethe non-cash financing activity related to the receivables repurchase.

17. We have reviewed your response to comment nine. Please revise the notes to your interim financial statements to discuss thenature of the error in your previously issued financial statements. Please also disclose in tabular form the impact that thisrestatement had on your previously reported cash flows for the six months ended June 30. 2005.



The Registrant has revised the notes to its interim financial statements as of and for the nine months ended September 30, 2005 to discussthe nature of the change from the previously issued financial

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statements. It has provided, in tabular form, the impact that the restatement has had on its previously reported cash flows from operating andinvesting activities for the six months ended June 30, 2005.

18. Please note that we will review the Underwriting Agreement, the Form of Credit Agreement and the Form of Indenture prior toaccelerating the effectiveness of this registration statement and that we may have comments pertaining to these exhibits oncethey are filed. Please file these exhibits with enough time for us to review them before requesting effectiveness.

The Registrant has provided, pursuant to Rule 418 of Regulation C, forms of the Underwriting Agreement, the Indenture and the CreditAgreement, to the Staff for its review. In addition, the Registrant has filed forms of these documents as exhibits to Amendment No. 5.

19. Please have counsel revise to opine that the preferred share purchase rights are binding obligations of the company.

We respectfully request an opportunity to discuss this comment with the Staff. In this regard, the opinion of counsel is being submittedpursuant to Item 601(b)(5) of Regulation S-K, which requires the submission of "An opinion of counsel as to the legality of the securitiesbeing registered, indicating whether they will, when sold, be legally issued, fully paid and non-assessable, and, if debt securities, whether theywill be binding obligations of the registrant." We do not believe that preferred share purchase rights are considered debt securities underDelaware corporate law.

20. In the last sentence of the second paragraph, please have counsel revise to clarify that counsel has relied as to certain factualmatters.

We have revised the last sentence of the second paragraph of the opinion of counsel to clarify that the reference to our reliance on"certain matters" refers to our reliance on "certain factual matters."

* * * * * * * * * * * *

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If you have any further questions or comments, or if you require any additional information, please do not hesitate to contact theundersigned by telephone at (202) 662-5128 or by facsimile at (202) 778-5128. Thank you for your assistance.

Very truly yours,

/s/ DAVID B.H. MARTINDavid B.H. Martin

Enclosures

cc:

Lesli Sheppard, Senior Staff AttorneyMatt Franker, Staff AttorneyRufus Decker, Accounting Branch ChiefScott Watkinson, Staff AccountantGregory F. Pilcher, Kerr-McGee CorporationJ. Michael Chambers, Akin Gump Strauss Hauer & Feld LLP

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