Waiver No. 2 to Five-Year Credit Agreement among Crompton Corporation, Subsidiaries, and Lender Banks (March 26, 2004)

WHEREAS, the Company, the Eligible Subsidiaries, the Banks, the Co-
Documentation Agents, the Syndication Agent and the Administrative Agent are parties
to the Credit Agreement;

WHEREAS, pursuant to the Credit Agreement, the Banks have made and
agreed to make certain loans to the Borrowers; and

WHEREAS, the Company has requested, and the Banks whose signatures
appear below, constituting the Required Banks, have agreed that certain provisions of the
Credit Agreement be waived in the manner and subject to the conditions set forth herein;

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

1. Defined Terms.  Capitalized terms used but not
   defined herein have the meanings assigned to them in the Credit Agreement.
2. Waiver. The Required Banks hereby (a) waive
   the provisions of Section 5.09 of the Credit Agreement to the extent, and
   only to the extent, necessary to permit the sale by the Company of the
   Equity Interests held by it in Gustafson LLC, a Delaware limited liability
   company, and Gustafson Partnership, a general partnership formed under the
   laws of the Province of Ontario, Canada, (collectively, the "Gustafson
   Equity Interests") for cash in an aggregate amount at least equal to
   $100,000,000 (the "Proposed Sale") and (b) acknowledge and agree that the
   Proposed Sale shall not be deemed to utilize the basket set forth in clause
   (C) of Section 5.09 for sales, leases and transfers of the assets of the
   Company and its Subsidiaries; provided that the foregoing waiver shall be
   effective only if (i) the date the Proposed Sale is consummated shall be on
   or prior to June 30, 2004, and (ii) the Company shall prepay Loans in an
   amount equal to 100% of the Net Cash Proceeds of the Proposed Sale as
   required by Section 2.11(f) of the Credit Agreement.
3. Collateral Release. The Banks hereby
   acknowledge and agree that, in accordance with the provisions of the
   Security Agreement, upon the completion of the sale of the Gustafson
   Equity Interests, any security interest held by the Collateral Agent for the
   benefit of the Secured Parties in the Equity Interests which are sold or
   otherwise transferred in such sale will, subject to the application of the
   proceeds of such sale as provided in Section 2 hereof, terminate without
   further action on the part of the Company, the Collateral Agent or any other
   party.
4. Waiver Fee. The Company agrees to pay to
   the Administrative Agent, for the account of each Bank that shall have
   executed and delivered to the Syndication Agent a counterpart of this
   Waiver prior to 5:00 p.m., New York City time, on March 26, 2004, a
   nonrefundable waiver fee (the "Waiver Fee") equal to .05% of the aggregate
   amount of such Bank's Commitment, whether used or unused, on the date
   hereof, payable in immediately available funds.
5. Representations and Warranties.  To induce the
   other parties hereto to enter into this Waiver, the Company hereby
   represents and warrants that:
1. The representations and warranties set forth in Article 4 of the Credit
   Agreement are true and correct on and as of the date hereof, except (i) to the extent such
   representations and warranties specifically relate to an earlier date and (ii) with respect to
   Section 4.04(b) of the Credit Agreement, as to any matter which has heretofore been
   disclosed in writing by the Company to the Banks;
2. No Default or Event of Default has occurred and is continuing;
3. This Waiver shall, when duly executed and delivered by the Company
   and upon satisfaction of the conditions to effectiveness of this Waiver set forth in Section
   6 below, constitute a legal, valid and binding obligation of the Company enforceable
   against the Company in accordance with its terms.
6. Conditions to Effectiveness.  This Waiver shall
   become effective on the date on which each of the following conditions has
   been satisfied:
1. The Syndication Agent shall have received counterparts of this Waiver
   that, when taken together, bear the signatures of the Company and the Required Banks.
2. The Administrative Agent shall have received payment of the Waiver
   Fee.
7. Effect of Waiver.  Except as expressly set
   forth herein, this Waiver shall not by implication or otherwise limit, impair,
   constitute a waiver of or otherwise affect the rights and remedies of the
   Banks under the Credit Agreement or any other Loan Document (except to
   the extent Section 3 hereof constitutes a release of all Liens, if any, on the
   Gustafson Equity Interests pursuant to the Security Agreement), and shall
   not alter, modify, amend or in any way affect any of the terms, conditions,
   obligations, covenants or agreements contained in the Credit Agreement or
   any other Loan Document, all of which are ratified and affirmed in all
   respects and shall continue in full force and effect. Nothing herein shall be
   deemed to entitle the Company to a consent to, or a waiver, amendment,
   modification or other change of, any of the terms, conditions, obligations,
   covenants or agreements contained in the Credit Agreement or any other
   Loan Document in similar or different circumstances. This Waiver shall
   apply and be effective only with respect to the provisions of the Credit
   Agreement specifically referred to herein.
1. Nothing herein will be deemed to reduce the obligations of any
   Subsidiary Guarantor under the Subsidiary Guarantee Agreement, which shall remain in
   full force and effect.
8. Counterparts.  This Waiver may be executed
   by one or more parties to this Waiver in any number of separate
   counterparts, each of which shall constitute an original, but all of which
   when taken together shall constitute but one contract. Delivery of an
   executed counterpart of a signature page of this Waiver by facsimile
   transmission shall be as effective as delivery of a manually executed
   counterpart hereof.
9. APPLICABLE LAW.  THIS WAIVER
   SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED
   BY THE LAWS OF THE STATE OF NEW YORK.
10. Headings.  Section headings used herein are
    for convenience of reference only, are not part of, and are not to be taken
    into consideration in interpreting, this Waiver.
11. Expenses.  The Company shall reimburse the
    Syndication Agent and the Collateral Agent for their reasonable out-of-
    pocket expenses in connection with this Waiver, including the reasonable
    fees, charges and disbursements of Cravath, Swaine & Moore LLP.

IN WITNESS WHEREOF, the Company, the Administrative Agent and
the undersigned Banks have caused this Waiver to be duly executed by their duly
authorized officers, all as of the date first above written.