FIRST AMENDED ASBESTOS PROPERTY DAMAGE CLAIMS RESOLUTION PROCEDURES USM ASBESTOS PROPERTY DAMAGE TRUST

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1 FIRST AMENDED ASBESTOS PROPERTY DAMAGE CLAIMS RESOLUTION PROCEDURES USM ASBESTOS PROPERTY DAMAGE TRUST I. INTRODUCTION These Asbestos Property Damage Claims Resolution Procedures ("PD Procedures") establish the exclusive procedures for evaluating, determining, and, if Allowed, paying Asbestos PD Claims (as defined in and pursuant to the Plan of Reorganization (the Plan )). Unless otherwise defined herein, all capitalized terms shall have the meanings ascribed thereto in the Plan) of United States Mineral Products Company ( USM ). II. PD TRUST The USM Asbestos Property Damage Trust (the PD Trust ), established in accordance with the Plan pursuant to the USM Asbestos Property Damage Trust Agreement (the "Trust Agreement"), shall be governed by one Property Damage Trustee ( PDT ),who shall be solely responsible for implementing and enforcing these PD Procedures. Absent fraud or collusion, the PDT s determinations shall be final. The PDT in his sole discretion may settle any Asbestos PD Claims to the extent he deems necessary and consistent with the goals of these PD Procedures. The PDT shall use his best efforts to complete the processing of all PD Claims within one year of the Effective Date. The PDT shall have the exclusive authority to terminate the PD Trust upon the completion of processing all Asbestos PD Claims and PD Demands in respect of which Claims Forms were timely filed against the PD Trust and the payment of all Allowed Asbestos PD Claims. To this end, in determining whether and when to terminate the PD Trust the PDT may determine in his sole and absolute discretion the likelihood of other Claim Forms being filed in respect of further PD Demands. The latter determination shall not require the publication or giving of any notice of the PDT's intention to terminate the PD Trust, except as may be required in the Trust Agreement. III. PD ADVISORY COMMITTEE There shall be a Property Damage Advisory Committee (the "PDAC") composed of the two property damage representatives who served on the USM Official Asbestos Claimants Committee. The PDT shall consult with the PDAC on all major policy and administrative decisions affecting, and the interpretation and implementation of, these PD Procedures. Where consultation is required under the Trust Agreement or these PD Procedures, the PDT need only seek advice and counsel from the PDAC and is independent and free to accept or reject any recommendation of the PDAC. In addition to any provisions in the Trust Agreement that may require the consent of the PDAC, the PDT shall obtain the consent of the PDAC regarding (i) participation or merger of the PD Trust with a claims resolution organization or contracting the operation of the PD Facility (as defined herein) to a claims resolution organization; (ii) material changes to these PD Procedures, other than any changes related to specific amounts to be paid or 1

2 percentages to be paid under these PD Procedures for Allowed Asbestos PD Claims; (iii) the designation of Approved Laboratories (as defined herein); (iv) the approval of a Cost Model for Past and Future Abatement Costs (as defined herein) under these PD Procedures; (v) the resolution of any material omission from these PD Procedures; and (vi) the termination of the PD Trust. IV. OVERVIEW The goals of these PD Procedures are to provide fair payment to all Claimants with Allowed Asbestos PD Claims, taking into account the basic principles and laws of the tort system as of the Petition Date and the resources available to the PD Trust. These PD Procedures are designed to provide a low transaction cost method of effectuating the resolution of Asbestos PD Claims. As such, neither these PD Procedures nor the determination of Asbestos PD Claims made pursuant to these PD Procedures shall constitute an admission against interest by any Claimant in any litigation or other disputed proceeding. Claimants may, but need not, be represented by counsel when seeking the allowance of an Asbestos PD Claim under these PD Procedures. These PD Procedures may only be interpreted by the PDT if an ambiguity exists. If these Procedures suffer from a material omission, the PDT shall resolve such omission upon obtaining the advice and consent of the PDAC. Each interpretation or resolution of an omission shall be consistent with the purposes set forth herein, including providing payment in a cost-effective, reasonable method. V. DETERMINATION AND PAYMENT OF PD CLAIMS A. Definitions As used herein, the following terms shall have the meanings which accompany them: 1. Abatement. "Abatement" shall mean and refer to the removal, enclosure, encapsulation or repair of ACM. 2. Abatement Costs. "Abatement Costs" shall mean and refer to the reasonable and customary costs of Past Abatement and Future Abatement, including, by way of example, costs for the Abatement itself, design, consultant and laboratory fees, on-site monitoring, supervision, insurance costs, disposal costs, replacement and/or repair of asbestos contaminated materials and fixtures, and, except for Abatement upon Demolition, the reasonable costs of replacement of ACM, with a non-asbestos containing material, all of which shall be determined by the PDT in accordance with the Cost Model. 3. ACM. "ACM" shall mean and refer to any asbestos-containing material or product containing more than 1% asbestos by weight as determined pursuant to AHERA regulations. 2

3 4. Allowed Claim. "Allowed Claim" shall mean and refer to any Asbestos PD Claim which the PDT has Allowed for payment of Allowed Costs under the terms of these PD Procedures. An Allowed Claim shall be, and be deemed to be, a judgment against the PD Trust, in the amount of the Allowed Costs for such Asbestos PD Claim. 5. Allowed Costs. "Allowed Costs" shall mean and refer to the amount allowed with respect to an Allowed Claim as follows: (a) Allowed Costs for Category 1 Claims are deemed to be equal to 3.3 times Abatement Costs, (b) Allowed Costs for Category 2 Claims shall be equal to Abatement Costs, (c) Allowed Costs for Category 3 Claims shall be equal to Discounted Payable Costs, and (d) Allowed Costs for Category 4 Claims shall be equal to Discounted Payable Costs. 6. Applicable Jurisdiction. "Applicable Jurisdiction" shall mean and refer to the jurisdiction in which the subject building is located or, with regard to a claim which has been asserted in a lawsuit, the jurisdiction where the lawsuit was filed. 7. Approved Laboratory. "Approved Laboratory" shall mean and refer to a laboratory competent to perform constituent analysis of bulk samples of ACM approved by the PDT with the concurrence of the PDAC. In addition to other laboratories that may be approved by the PDT, those laboratories listed on Exhibit 2 shall qualify as Approved Laboratories. 8. Asbestos. "Asbestos" shall mean and refer to chrysotile asbestos, amosite asbestos, crocidolite asbestos, tremolite asbestos, anthophyllite asbestos, actinolite asbestos, and any of these minerals that have been chemically treated and/or altered. 9. Bar Date. Bar Date shall mean the final date of February 20, 2003 established by order of the Bankruptcy Court for the filing of the Bar Date Proof of Claim against the chapter 11 estate of USM. 10. Bar Date Proof of Claim. Bar Date Proof of Claim or Bar Date POC shall mean and refer to the initial Official Form 10 Proof of Claim which was required to be filed on or before the Bar Date pursuant to order of the Bankruptcy Court in the USM chapter Certified Class Action. "Certified Class Action" shall mean and refer to a Class Action in which the applicable court had entered an order certifying the underlying action or a portion thereof, and USM was named as a party defendant, as of the Petition Date, namely Central Wesleyan College v. W.R. Grace Co., et al., United States District Court for the District of South Carolina, Civil Action No. 2: (the National Colleges Class Action ); Kirbyville Independent School District, et al v. Asbestospray Corporation, et al., United States District Court for the Eastern District of Texas, Beaumont Division, Civil Action No. 1:94-CV- 412 (the Texas Governmental Entities Class Action ); and Anderson Memorial Hospital v. W.R. Grace & Company, et al., Case No. 92-CP (S.C. Comm. Pleas, Hampton County), (the South Carolina Building Owners Class Action ). 3

4 12. Claimant. "Claimant" shall mean and refer to the owner or operator of one or more buildings which are the subject of an Asbestos PD Claim, or to the duly authorized legal agent thereof, and shall include the Class Representative acting by and on behalf of a Class Action. 13. Claim Category. Claim Category shall mean and refer to one of the four categories of Asbestos PD Claims as set forth herein, to wit: Category 1, Category 2, Category 3, and Category Claim Materials Distribution Date. "Claim Materials Distribution Date" shall mean the last day of the month in which Claims Materials were first made available to Claimants. 15. Class Action. "Class Action" shall mean and refer to a Certified Class Action or a Putative Class Action on behalf of which a Bar Date POC(s) has been timely filed by the Certified or Putative Class Representative. 16. Class Member. Class Member shall mean and refer to a member of a Class Action, other than an Excluded Member, whose PD Claim is included in a Bar Date POC(s) filed by the Class Representative. 17. Class Representative. "Class Representative" shall mean and refer to the named class representative in a Class Action. 18. Cost Model. "Cost Model" shall mean and refer to an appropriate model or formula developed by the PDT with the advice and concurrence of the PDAC for the purpose of determining Past and Future Abatement Costs in respect of an Allowed Claim. 19. Demolition: "Demolition" shall mean and refer to the deliberate destruction of a building or a part thereof for any purpose by its owner or operator, by those acting for or on behalf of the owner or operator, or by a government agency, undertaken at least in principal part for reasons not related to asbestos management or control, and the ACM is not replaced. 20. Disallowed Claim. "Disallowed Claim" shall mean and refer to any Asbestos PD Claim that has been determined by the PDT to not qualify for payment under these PD Procedures. 21. Discounted Payable Costs: "Discounted Payable Costs" shall mean and refer to the reduced amount payable to a Claimant for an Allowed Category 3 Claim or an Allowed Category 4 Claim as provided herein. 22. Effective Date. Effective Date shall have the meaning provided for such term in the Plan. 4

5 23. Excluded Member. "Excluded Member" shall mean and refer to a Claimant who was a member of a Class Action but who requests exclusion from such Class Action, including a Claimant who despite membership in a Class Action, filed an individual Bar Date POC which did not reference or claim membership in such Class Action and is deemed, by such filing, to have requested exclusion from such Class Action with respect to USM. 24. Future Abatement Costs. "Future Abatement Costs" shall mean and refer to estimated Abatement Costs to be incurred by the Claimant as calculated by application of the Cost Model. Future Abatement Costs shall include the Abatement Costs for removal of previously encapsulated or enclosed ACM. 25. Indirect Asbestos-Related Property Damage Claims. Indirect Asbestos-Related Property Damage Claims or Indirect PD Claims shall mean any Claim, Demand, liability or remedy, existing or hereafter existing, against the Debtor for contribution, reimbursement, indemnity or subrogation (as those terms may be defined pursuant to the non-bankruptcy law of the relevant jurisdiction) and any other indirect claim of any kind whatsoever, whenever and wherever arising or asserted, that are held by Entities that have been or may be defendants or respondents in an action or proceeding seeking (i) damages for Asbestos PD Claims under any theory of law, or (ii) reimbursement or payment of settlements paid by or on behalf of codefendants or litigation or defense costs, including without limitation, legal fees, incurred in connection with litigation involving Asbestos PD Claims. Indirect Asbestos-Related Property Damage Claims include, without limitation, Asbestos PD Claims asserted or that may be asserted by or on behalf of Armstrong World Industries, Inc., Celotex Corporation, Carey Canada, Inc., and the Celotex Asbestos Settlement Trust. 26. Initial Allocation. Initial Allocation shall mean and refer to the PD QSF Amount, less the Reserve, allocated to each Claim Category in accordance with Section V.C. of these PD Procedures. A protocol describing the manner by which the Reserve shall be established shall be prepared by the PDT with the consent of the PDAC. 27. Initial Distribution Date or IDD. Initial Distribution Date or IDD shall mean and refer to the date on which the PDT, after completing his determination of PD Claims in accordance with these PD Procedures, distributes Payable Costs in respect of Allowed Claims from the Initial Allocation. 28. Nullum Tempus Claims. Nullum Tempus Claims shall mean and refer to those PD Claims filed by or on behalf of States and, or other governmental/political entities, that are protected from applicable statutes of limitation and/or repose, as a result of which such statutes do not run or otherwise apply to limit the time within which such PD Claims can, or could have been, made or filed in the Applicable Jurisdiction. 5

6 29. Past Abatement Costs. "Past Abatement Costs" shall mean and refer to Abatement Costs for Abatement conducted prior to the date of the Claimant s submission of its PD Claim Form to the PD Facility as calculated by application of the Cost Model. 30. Payable Costs. Payable Costs shall mean and refer to an amount equal to the Allowed Costs in respect of an Allowed Claim in a Claim Category multiplied by the applicable Payment Percentage for that Claim Category. 31. Payment Percentage. "Payment Percentage" shall mean and refer to the percentage of the Initial Allocation and Subsequent Allocation, as the case may be, allocated to a Claim Category in respect of the total Allowed Costs of all Allowed Claims in such Claim Category as calculated by the PDT. The Payment Percentage for a Claim Category shall equal a fraction, the numerator of which is the Initial Allocation or the Subsequent Allocation, as the case may be, in such Claim Category, and the denominator of which is the total Allowed Costs of all Allowed Claims in such Claim Category. 32. PD Advisory Committee or PDAC. PD Advisory Committee or PDAC shall have the meaning provided in Section III of these PD Procedures, with the powers and responsibilities set forth therein and in the Trust Agreement. 33. PD Claim. PD Claim shall mean and refer to an Asbestos PD Claim in respect of which a Bar Date Proof of Claim was timely filed. 34. PD Claim Form or Claim Form. "PD Claim Form" or "Claim Form" shall mean and refer to the form(s) and supporting instructions approved by the PDT to be used by Claimants in the proper submission of PD Claims to the PD Facility. 35. PD QSF Advance. PD QSF Advance" shall have the meaning provided for such term in the Plan. 36. PD Consideration. PD Consideration shall mean and refer to (a) the PD QSF Cash, (b) any Additional PD Distribution paid to the PD Trust, and (c) the PD QSF Advance (together with any interest thereon) repaid by the Reorganized Debtor, all as provided in the Plan. 37. PD Demand. PD Demand shall mean and refer to a Demand for payment with regard to asbestos property damage that was not a Claim (as defined in the Plan) as of the Bar Date. 38. PD Facility. "PD Facility" shall mean and refer to the facility established or selected by the PDT with the consent of the PDAC for the disposition and payment of PD Claims pursuant to these PD Procedures. 6

7 39. PD Qualified Settlement Fund Amount or PD QSF Amount. PD Qualified Settlement Fund Amount or PD QSF Amount" shall mean and refer to that portion of the Qualified Settlement Fund to be distributed to the PD Trust in cash on the Effective Date, net of the PD QSF Advance, as provided in the Plan. 40. PD Trust. "PD Trust" shall mean and refer to the trust established pursuant to the PD Trust Agreement, which Trust is a "qualified settlement fund" pursuant to Section 468B of the IRC and the regulations issued pursuant thereto. 41. PD Trustee or PDT. PD Trustee or PDT shall have the meaning provided in Section II of these PD Procedures. 42. Petition Date. "Petition Date" shall mean and refer to July 23, 2001, the date USM filed its petition for relief under chapter 11 of the Bankruptcy Code. 43. Plan of Reorganization or the Plan. "Plan of Reorganization" or the Plan shall mean and refer to the Fourth Amended Plan of Reorganization, as the same may hereafter be amended, Jointly Proposed by the Chapter 11 Trustee and the Official Committee of Asbestos Bodily Injury and Property Damage Claimants for United States Mineral Products Company, as confirmed by the Bankruptcy Court and the District Court. 44. Pre-Filed Claims. Pre-Filed Claims shall mean and refer to those PD Claims filed by or on behalf of a Claimant which were asserted in a lawsuit in a court of competent jurisdiction in which USM was named as a party defendant, which Claims had not been dismissed prior to the Petition Date, including PD Claims filed on behalf of Class Members in a Certified Class Action by a duly authorized Class Representative. 45. Preponderance of the Evidence. Preponderance of the Evidence shall mean and refer to the greater weight of the credible evidence as determined by the PDT. 46. Principal ACM. "Principal ACM" shall mean and refer to Surface Treatment ACM, which was the primary type of ACM which USM manufactured and sold prior to the Petition Date. 47. Product Identification or PID. "Product Identification" or PID shall mean and refer to proof by a Preponderance of the Evidence that the ACM which is the subject of an Asbestos PD Claim was designed, manufactured, distributed, or sold by USM. 48. Putative Class Action. Putative Class Action shall mean and refer to a Class Action in which USM was named as a party defendant, or to any part thereof, for which the Class Representative purports to act on behalf of the class members thereof, and which had not been settled or finally adjudicated to the exhaustion of all appellate rights as of the Petition Date, namely Anderson Memorial Hospital v. W.R. Grace & Company, et al., Case No. 92-CP (S.C. Comm. Pleas, Hampton County) (for non-south Carolina buildings) and The County of 7

8 Orange and Lon Morris College, Individually, and As Class Representative by and on behalf of a Class v. United States Mineral Products Company, et al., Cause No. D C-BC, 260 th Judicial District Court (Orange County, Texas) (for Texas building owners). 49. Qualified Person. "Qualified Person" shall mean and refer to a trained industrial hygienist, engineer, contractor, consultant and/or asbestos coordinator who is certified, licensed and/or specially trained and experienced to identify and assess ACM and to select appropriate Abatement. 50. Reconsideration. Reconsideration shall mean and refer to the procedure hereinafter set forth in V.G.3. for Claimants to seek reconsideration of Asbestos PD Claims which have been disallowed by the PDT. 51. Reserve. Reserve shall mean and refer to that portion of the PD Consideration set aside and retained by the PDT to pay for expenses of the PD Trust. 52. Subsequent Allocation. Subsequent Allocation shall mean and refer to any Additional PD Distribution paid or payable to the PD Trust in connection with the Subsequent Asset Distribution, as well as any payments received by the PD Trust, including interest, in respect of the PD QSF Advance. 53. Subsequent Distribution Date(s) or SDD. Subsequent Distribution Date(s) or "SDD" shall mean and refer to the date(s) when the PDT shall distribute the Subsequent Allocation(s) to Claimants. 54. Summary Disposition Procedure. "Summary Disposition Procedure shall mean and refer to the alternate elective treatment of a Category 1 Claimant s PD Claims as provided in Section V.B.1. of these PD Procedures. 55. Surface Treatment. "Surface Treatment shall mean and refer to ACM applied to ceilings, columns, steel frames, and other surfaces in buildings such as fireproofing and acoustical treatment. 56. Trust Agreement. "Trust Agreement" shall have the meaning provided in Section II of these PD Procedures. 57. USM. "USM" shall mean and refer to United States Mineral Products Company, d/b/a Isolatek International, the successor-by-merger to Dalen Corporation, Columbia Acoustics and Fireproofing Company, The Weather-Shield System Corporation, and Roof Membrane Service Corporation, the Debtor in Case No pending in the Bankruptcy Court for the District of Delaware. 8

9 58. USM ACM. "USM ACM" shall mean and refer to an ACM Surface Treatment designed, manufactured, sold or distributed by USM. B. Allowance of Asbestos PD Claims 1. Categories of Claims. a. Category 1. Category 1 Claims shall consist of Pre-Filed and Nullum Tempus Claims. A Category 1 Claim filed by a Certified Class Representative shall include all PD Claims by and on behalf of all Class Members. A Category 1 Claimant may make an election that all of its PD Claims be treated pursuant to the Summary Disposition Procedure attached hereto as Exhibit 1. b. Category 2. Category 2 Claims shall consist of those PD Claims that are not Category 1 or Category 3 Claims; provided, however, that a Category 2 Claimant may make an election that all of its PD Claims be treated as Category 4 Claims to be paid only Discounted Payable Costs. c. Category 3. Category 3 Claims shall consist of those PD Claims filed by the Putative Class Representatives, by and on behalf of all Class Members, to be paid Discounted Payable Costs. A Category 3 Claim filed by a Putative Class Representative shall include all PD Claims of all Class Members who were included in the Bar Date POC(s) filed by the Class Representative, by and through Class Counsel. d. Category 4. Category 4 Claims shall consist of those PD Demands to be paid Discounted Payable Costs. 2. The PDT. The PDT shall serve as the finder of fact, and the PDT shall determine, based upon a Preponderance of the Evidence, where appropriate, by applying the law of the Applicable Jurisdiction as of the Petition Date, whether a Claim qualifies as an Allowed Claim under these PD Procedures. The PDT s determination shall be final and binding subject to Reconsideration (as herein provided). 3. Legal Prerequisites. a. For an Asbestos PD Claim to be an Allowed Claim, a Claimant must establish, by a Preponderance of the Evidence, each of the following: i. That the ACM for which the Asbestos PD Claim is submitted is USM ACM, except that the PID requirements may be relaxed to the extent provided in the Summary Disposition Procedure, attached hereto as Exhibit 1 for Category 1 Certified Class Action s PD Claims. 9

10 ii. That the ACM for which the Asbestos PD Claim is submitted has caused compensable injury and damage, provided that compensable injury and damage are presumed to be caused by Surface Treatment ACM. iii. The PDT shall require that Claimants who assert Pre-Filed and/or Nullum Tempus Claims, shall provide such documentation and/or evidence as the PDT may require to establish such status by a Preponderance of the Evidence. b. In determining whether to Allow what has been characterized as a PD Demand in a Claim Form, for which PD Demand a Bar Date Proof of Claim was not filed, the PDT, in his sole discretion, shall determine whether such Asbestos PD Claim was actually a PD Claim at the Bar Date and, if so, subject to Section V.B.4.a.i., the same shall be denied. 4. Disallowance of PD Claims a. The PDT shall disallow: i. any PD Claim for which the Claimant did not file a timely Bar Date POC or whose late filed Bar Date POC is rejected, both as determined by the PDT in his sole discretion in accordance with his interpretation of applicable bankruptcy law. ii. any Asbestos PD Claim where there has been a prior judicial determination or a stipulation that the ACM for which the Asbestos PD Claim was filed is not USM ACM. iii. any Asbestos PD Claim where there has been a prior judicial determination, a stipulation or an admission that the Asbestos PD Claim was time barred under the applicable statutes of limitation and/or repose in the Applicable Jurisdiction (unless such claim has been revived or reinstated by reason of legislative enactment in the Applicable Jurisdiction before the IDD). iv. any Asbestos PD Claim where the PDT determines, by a Preponderance of the Evidence, that such Claim would have been barred as a matter of law or factually time-barred under the laws of the Applicable Jurisdiction if considered on the Petition Date, unless such Claim has been revived or reinstated by reason of legislative enactment in the Applicable Jurisdiction before the IDD; provided, however, there is a presumption that Pre-filed Claims are not factually time-barred. Nullum Tempus Claims are conclusively presumed to not be barred by statutes of limitation and/or repose. b. If the PDT concludes that there is a question whether an Asbestos PD Claim is factually time barred, or legally time barred under the laws of the Applicable Jurisdiction as of the Petition Date, he shall request that the Claimant provide all relevant evidence and/or documents such as reports of asbestos surveys, inspection(s), abatement(s), or 10

11 other documents for his review, to be provided within such time period as designated, but not to exceed 60 days from the date of the request. The Claimant shall provide such evidence and/or documents to the extent available and may provide any other materials and memorandums of law, opinion of counsel or argument, necessary to establish that the statute(s) of limitation(s) and/or repose in the Applicable jurisdiction have not run, or otherwise expired based on a Preponderance of the Evidence. c. Documents or other evidence submitted by a Claimant which create an admission against USM s interest pursuant to the Federal Rules of Evidence ( FRE ), regarding a material fact or issue, shall be accepted by the PDT as conclusive proof of such fact or issue. d. The requirements of this Paragraph V.B.4 shall be relaxed by the PDT for Category 3 Claims for Discounted Payable Costs, and for Category 4 PD Claims for Discounted Payable Costs for which the Claimant elects to be paid Discounted Payable Costs for all of its PD Claims rather than treatment as Category 2 Claims. C. Allocation of PD Consideration 1. Division of Initial Allocation a. After the PDT has reviewed and processed all PD Claims, upon consultation with the PDAC, the PDT shall determine the amount of the PD Consideration to be finally allocated for the payment of Category 1 Claims, Category 2 Claims, and Category 3 Claims based on the relative values of Allowed Claims in each such Category, notions of equity and fundamental fairness and principles of equality of distributions, as well as the total amount of PD Consideration received or anticipated to be received. Further, in determining the discount in respect of Category 3 Claims, the PDT shall take into consideration the extent of the discounts taken for similar discounted categories of property damage claims in the National Gypsum and/or the Celotex/Carey Canada bankruptcies. The PDT shall set aside the sum of $200,000 for Category 4 Claims from the Initial Allocation which amount shall not be subject to modification. 2. Division of Subsequent Allocation a. The PDT shall apply the same division formula as set forth in V.C.1 above to any Subsequent Allocation. D. Payment of Allowed Claims 1. Claims filed by Certified Class Representatives by and on behalf of Certified Class Actions may only be filed in Category 1. Claims filed by Putative Class Representatives by and on behalf of a Putative Class may only be filed in Category 3. PD Demands may only be filed in Category 4. 11

12 2. The PDT shall process all Asbestos PD Claims as quickly as practicable after the Effective Date in the following order: Category 1 PD Claims pursuant to the Summary Disposition Procedure in Exhibit 1 hereto, Category 1 PD Claims, Category 3 PD Claims, Category 2 PD Claims, Category 4 PD Claims, and Category 4 PD Demands. Asbestos PD Claims shall be paid in the order that they are processed. 3. If the amount available for the payment of Category 1 and 2 Claims is equal to or greater than the total Allowed Costs of all Category 1 and Category 2 Claims, the PDT shall pay all such Allowed Costs in full. Otherwise, with regard to all Category 1 and Category 2 Claims, the PDT shall pay the Payable Costs for Allowed Category 1 and Category 2 Claims to the extent of the amount of the Initial Allocation (and Subsequent Allocation) allocated to Category 1 and Category 2 Claims as provided in Paragraph V.C.1 of these PD Procedures. 4. If the amount available for the payment of Category 3 Claims is equal to or greater than the total Discounted Payable Costs of all Category 3 Claims, the PDT shall pay all such Discounted Payable Costs in full. Otherwise, with regard to all Category 3 Claims, the PDT shall pay the Discounted Payable Costs for Allowed Category 3 Claims pro rata to the extent of the amount of the Initial Allocation (and Subsequent Allocation) allocated to Category 3 Claims as provided in Paragraph V.C.1 of these PD Procedures. 5. If the amount available for the payment of Category 4 Claims is equal to or greater than the total Allowed Costs of all Category 4 Claims, the PDT shall pay all such Allowed Costs in full. Any excess amount after the payment of all Allowed Category 4 Claims in full shall be re-allocated to Category 1, 2 and 3 Claims in accordance with the division of Initial Allocation as provided in Paragraph V.C.1 of these PD Procedures. Otherwise, with regard to all Category 4 Claims the PDT shall pay the Discounted Payable Costs for Allowed Category 4 Claims pro rata to the extent of the amount of the Initial Allocation (and Subsequent Allocation) allocated to Category 4 Claims as provided in Paragraph V.C.1 of these PD Procedures. VI. DOCUMENTATION, SUBMISSION AND REVIEW OF PD CLAIMS A. Documentation Except as otherwise may be provided for herein, no PD Claim shall be an Allowed Claim unless the documentation listed below for each Claim Category is submitted to the PD Facility in support of the PD Claim. All documentation provided by a Claimant must be sufficient to establish, by a Preponderance of the Evidence, the requirements of these PD Procedures. The absence of one or more of the categories of documents set forth below shall not prejudice the allowance of, or constitute the basis for the disallowance of a PD Claim if the Claimant certifies that, despite reasonable efforts, the required documentation or evidence could not be located. Alternative documents or testimony that establishes, by a Preponderance of the Evidence, the necessary facts to support the PD Claim shall be accepted. Claimants may also use evidence submitted and determinations made by the claims processing facilities in other asbestos 12

13 bankruptcies to establish, by a Preponderance of the Evidence, the quantity of ACM in buildings or structures for which PD Claims are submitted. The following documents must be supplied: 1. Category 1 Summary Disposition. Category 1 Claimants who elect for all of their PD Claims to be treated pursuant to the Summary Disposition Procedure shall provide such documentation as required in Exhibit Category 1, Category 2 and Category 4 Claims. a. A completed PD Claim Form, describing the location, type and quantity of USM ACM and the installation date thereof, including a certification of the information contained therein; b. Copies of presently-existing bulk sample analysis results and/or records thereof showing that abated material contained asbestos. The bulk sample analysis technique must be polarized light microscopy or another generally acceptable method, including those acceptable to the United States Environmental Protection Agency. A minimum of one sample from each Homogeneous Area for which Abatement Costs are claimed must have been analyzed; c. Documentation which establishes, by a Preponderance of the Evidence, that ACM that is the subject of the Asbestos PD Claim is USM ACM, which the PDT may confirm by any method and which confirmation shall be at the expense of the Claimant. Identification of USM ACM may be established by any or a combination of the following, among others: i. constituent analysis of representative bulk sample(s) by an Approved Laboratory showing that the ACM that is the subject of the Claim is USM ACM; ii. a sworn affidavit of an individual with personal knowledge that USM ACM was used in the building or structure for which the Asbestos PD Claim is made, setting forth the individual s conclusion that USM is the manufacturer of the ACM and the factual basis for that conclusion; iii. documentation that the USM ACM was used in the building or structure for which the Asbestos PD Claim is made including, without limitation, sales invoices; purchase orders; architectural specifications and records; bid documents; contracts and subcontracts; change orders; material approvals; maintenance, repair and renovation records; complaints to contractors; installation records; advertisements; insurance claims; supplier records; documents from discovery in lawsuits; and USM records. For this purpose, a specification which establishes only a standard for the type of product, (i.e. or equal 13

14 specifications) shall not sustain a Asbestos PD Claim without some additional substantiating proof that USM ACM was used; or iv. a prior judicial determination, stipulation or admission entered into by USM that the ACM that is the subject of the Asbestos PD Claim is USM ACM. d. A copy of the report of a Qualified Person detailing information sufficient for the PDT to apply the Cost Model based on the type, location and quantity of USM ACM and type and scope of Abatement performed and/or to be performed. 3. Category 3 Claims a. A Completed Category 3 Claim Form setting forth such information as the PDT shall determine as necessary documentation. At a minimum the completed Category 3 Claim Form shall describe the location, type and quantity of USM ACM and the installation date thereof, including a certification of the information contained therein. B. Processing and Review of Asbestos PD Claims 1. Submission of PD Claims. a. All Asbestos PD Claims shall be submitted on the appropriate PD Claim Form within six (6) months after the Claim Materials Distribution Date, except for Category 4 Claims, and shall include the documentation (as set forth in Paragraph V.A.) required to substantiate the Asbestos PD. b. The PD Facility may establish procedures designed to reduce administrative costs, which do not prejudice the Claimants substantive rights. The PD Facility also may establish guidelines to prevent abuse of the PD Facility s objective of providing for cost-effective and reasonable methods of Determination which do not prejudice the Claimants substantive rights and which are not inconsistent with these PD Procedures. The PD Facility shall process Category 1 Claims pursuant to the Exhibit 1 Summary Disposition Procedure for any Category 1 Claimant who elects such treatment. c. The PDT may defer the processing of Category 4 Claims for such period of time as he may determine in his sole discretion to be adequate for Category 4 PD Demands to be filed, but in any case all Category 4 PD Demands which are Allowed shall be paid within five (5) years from the Effective Date. 2. Review of Asbestos PD Claims. a. Upon receipt of a PD Claim Form, the PD Facility shall review the PD Claim Form to determine whether the necessary documentation (as set forth in Paragraph V.A.) 14

15 has been submitted. If additional documentation is required in order to evaluate the Asbestos PD Claim, the PD Facility shall notify the Claimant in writing. Any Asbestos PD Claim requiring additional documentation as to which no such further documentation is provided within ninety (90) days after the date of such notification, shall be a Disallowed Claim, provided that the Claimant shall have the right to request Reconsideration (as hereinafter provided). b. Once all of the necessary documentation pertinent to an Asbestos PD Claim is received, the PD Facility will determine whether the Asbestos PD Claim will be an Allowed Claim. The PD Facility will use its best efforts to notify the Claimant in writing by mail of its determination within 120 days of receipt of all necessary documentation. c. The PD Facility s allowance of a Asbestos PD Claim shall include the dollar amount of Abatement Costs based on the Cost Model and the Allowed Costs of such Allowed Claims. If the Allowed Costs are less than what was sought in the PD Claim Form as filed by the Claimant for any reason, or the Claim is disallowed in whole or in part, the final determination shall include a detailed, written statement supporting the PDT s finding. Absent a determination by the PDT of manifest injustice, the determination of the PD Facility as to the Allowed Costs shall be final and binding on both parties and may not be reopened, subject to Reconsideration (as hereinafter provided). 3. Reconsideration of Determined Asbestos PD Claims. a. A Claimant shall have twenty (20) days from the date of receipt of the PD Facility s notice of determination ( Notice of Determination ) with respect to an Asbestos PD Claim to file with the PD Facility a written request for Reconsideration of such determination. The Claimant must state in writing the reason(s) for seeking Reconsideration and include any additional materials not theretofore submitted that the Claimant wishes to be considered in connection with the Reconsideration. b. Upon receipt of a request for Reconsideration, the PDT shall review the Asbestos PD Claim, the supporting documentation, the Claimant s reasons for seeking Reconsideration and arguments in support thereof, any newly submitted material, the Notice of Determination and reasons thereof, and any other relevant material. The PDT may not raise or rely on any reasons not stated in the Notice of Determination as a basis for denying the request for Reconsideration. The PDT shall have ninety (90) days from the date of receipt of a Claimant s request for Reconsideration to issue a Notice of Determination after Reconsideration. If such determination is not issued within said ninety-day time period, the Asbestos PD Claim shall be Allowed as originally submitted, unless the PDT notifies the Claimant in writing that the time for such Reconsideration is being extended for no more than ninety (90) days. c. The decision of the PDT upon Reconsideration shall be final and binding and not subject to appeal. VII. INDIRECT PD CLAIMS 15

16 A. Overview It shall be an overarching principle of these PD Procedures that the PD Trust shall not be required to pay both the Payable Costs for all Asbestos PD Claims other than Indirect PD Claims (a "Direct PD Claim") and the related Indirect PD Claim based on the Direct PD Claim, and nothing in these PD Procedures shall be construed to require that the PD Trust pay, and the PD Trust shall not pay, in respect of any Direct PD Claim and related Indirect PD Claim, in the aggregate, more than the Payable Costs in respect of such Direct PD Claim, if allowable under these PD Procedures (whether by payment of Payable Costs to the holder of the Direct PD Claim or to one or more holders of related Indirect PD Claims or otherwise), and nothing in this Paragraph VII shall modify the other Paragraphs or provisions of these PD Procedures. B. Initial Submission of Information The holder of an Indirect PD Claim (the "Indirect Claimant") shall submit the following initial information to the PD Trust within sixty (60) days after the Effective Date: 1. Name and address of the Indirect Claimant. 2. Name, Address and Social Security Number or Employer s Identification Number of the holder of the Direct PD Claim (the "Direct Claimant"). 3. Copies of relevant documents which form the basis of the Indirect Claim, including but not limited to the allowed amount of the Direct PD Claim as determined by the claims administrator or trustee of any other asbestos property damage facility or trust (hereinafter, Other PD Administrator ) and/or all settlement related documents. 4. Proof of payment by the Indirect Claimant to the Direct Claimant. In addition to the foregoing, the PDT may request such additional information as he deems necessary in his sole discretion, including but not limited to any information provided by the holder of such Direct PD Claim to the Other PD Administrator or to the Indirect PD Claimant, which shall be submitted within thirty (30) days after the date of such request. In the event that such information is not timely transmitted to the PD Trust, the Indirect PD Claim may be disallowed, in the sole discretion of the PDT. C. Review, Submission, Documentation, Allowance, and Disallowance of Indirect PD Claims Indirect PD Claims asserted against the PD Trust shall be disallowed by the PDT unless and until the Indirect Claimant establishes to the satisfaction of the PDT that (a) the Indirect Claimant(s) has paid in full the liability and obligations of the PD Trust to a Direct Claimant for an Asbestos PD Claim which would have otherwise been allowable under these PD Procedures, 16

17 and to the extent necessary to determine Allowance, the PDT shall require that the Indirect Claimant provide such additional evidence and/or documentation as the PDT deems necessary in his sole discretion to make such determination of allowability, and (b) the Indirect Claimant s aggregate liability for the Direct PD Claim has been fixed, liquidated and paid by the Indirect Claimant in the allowed amount in accordance with the claim determination of the Other PD Administrator and based upon a claims allowance process which has not been challenged or objected to by such Indirect Claimant, or is otherwise not the subject of litigation initiated by such Indirect Claimant, either directly or indirectly, with an appropriate release in favor of the PD Trust or a Final Order, and (c) the Direct Claimant and Indirect Claimant have forever released the PD Trust, by a release in form and substance satisfactory to the PDT, from all liability to the Direct Claimant. In no event shall any Indirect Claimant have any rights against the PD Trust superior to the rights of the related Direct Claimant, including any rights with respect to the timing, amount or manner of payment. In any case where the Indirect Claimant has satisfied the Direct PD Claim against the PD Trust by way of a settlement, the Indirect Claimant shall obtain for the benefit of the PD Trust a release in form and substance satisfactory to the PDT. The PDT may develop and approve a separate Proof of Claim Form for Indirect Claims. Indirect PD Claims which have not been Disallowed, discharged, or otherwise resolved by prior order of the Bankruptcy Court, shall be processed, Allowed or Disallowed, liquidated, paid, and satisfied in accordance with procedures to be developed and implemented by the PDT, which procedures (a) shall determine the validity and allowance of such Indirect PD Claims consistent with Section 502(e) of the Bankruptcy Code; and (b) shall otherwise provide the same processing and payment to the holders of such Indirect PD Claims that are Allowed as the PD Trust would have afforded the holders of any underlying Direct PD Claims which are, or could have been, Allowed under these PD Procedures by the PDT. 17

18 EXHIBIT 1 To further encourage the efficient and consensual resolution of Claims at the lowest possible administrative costs, a Category 1 Claimant may elect to have the Allowed Costs for all of its PD Claims, including for Certified Class Actions those of all Class Members, determined by the PDT through a Summary Disposition Settlement Procedure (the Summary Disposition Procedure ) as described herein. The objective of the Summary Disposition Procedure is to determine the tort value of the Category 1 Claimant s cause(s) of action ( Claim ) with respect to USM. The tort value of the Claim shall be defined as the probable amount of the verdict that the Category 1 Claimant would have obtained, and on behalf of the Certified Class in the case of a Certified Class Representative, if tried in the Applicable Jurisdiction, as determined by the PDT in his sole discretion. Such tort value as determined by the PDT, shall constitute the Allowed Costs of such Claim, from which, the Payable Costs for such Claim shall be determined like all other Category 1 Claims in accordance with these PD Procedures. In the negotiations with the Category 1 Claimant, the PDT shall take into account all matters he shall deem relevant including, but not limited to, the strength of the liability case developed by Category 1 Claimant, or for Certified Class Actions the Certified Class Representative and/or Class Counsel, including the amount and the quality of discovery available for use, in such trial, against USM, prior verdicts and/or settlements obtained by Category 1 Claimant, Certified Class Representative and/or Class Counsel in similar cases tried or settled in the Applicable Jurisdiction, the amounts the Category 1 Claimant, Certified Class Representative and/or Class Counsel has obtained in other asbestos bankruptcies and the basis upon which Allowed Costs and/or Payable Costs were obtained, the legal rulings in the case, other relevant legal rulings in the Applicable Jurisdiction, the experience of Category 1 Claimant s Counsel, and the claim for damages which the Category 1 Claimant could have presented to the jury which was attributable to USM s product(s) and/or its conduct, including the likelihood that the trial court would have allowed the Category 1 Claimant to recover damages associated with the abatement of Principal ACM manufactured by companies other than USM and provided there is clear precedent for such recovery in the Applicable Jurisdiction, but excluding any punitive or exemplary damages. The PDT shall establish an initial threshold of USM product identification ( PID ) for which such Category 1 Claimant shall submit evidence of in accordance with these PD Procedures. However, once the threshold of USM PID is met, the PDT may consider the aggregate quantity of Principal ACM in all of the Category 1 Claimant s buildings or all of the buildings of the Class members of such Certified Class (the Total Principal ACM ) in order to arrive at a determination of USM s legal share of such Total Principal ACM. The Category 1 Claimant may prove the Total Principal ACM by any means acceptable to the PDT under the standard of Preponderance of the Evidence, including reasonable extrapolation from other customarily accepted data. 18

19 In his determinations, the PDT shall value most fully claims in which there is proof of both PID and quantity and shall discount other claims in accordance with their trial value or settlement history. In determining USM s legal share of the Total Principal ACM, the PDT shall deduct the total amount of all Surface Treatment ACM of such Category 1 Claimant or with regard to a Certified Class Action, all Class Members, as the case may be, which has been the subject of an award of Allowed Costs or Payable Costs in any other asbestos bankruptcy, or the subject of any previous tort settlement, judgment, and/or award. In the event that the Category 1 Claimant and in the case of a Certified Class Action, the Certified Class Representative, has settled and/or obtained a final award by judgment in the tort system, and/or has obtained an award of Allowed Costs or Payable Costs in any other asbestos bankruptcy, for or on behalf of any other Surface Treatment manufacturer, the PDT shall adjust the Payable Costs to insure that USM does not pay more than its market share of Surface Treatment ACM as compared to the settlement and/or judgment amount(s) paid by other Surface Treatment manufactures and/or allowed by bankruptcy trust(s) on behalf of a Surface Treatment manufacture(s). The PDT shall develop an appropriate Claim Form requiring such information as the PDT determines is necessary to review and determine Claims submitted by Category 1 Claimant pursuant to this Summary Disposition Procedure. 19

20 EXHIBIT 2 APPROVED LABORATORIES 1. Material Analytical Services ( MAS ) 2. Millette, Vanderwood & Associates ( MVA ) 20