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EXHIBIT 10.7
PROPANE/PROPYLENE AGREEMENT
This Agreement, dated this 16th day of September, 1985, is made by and
between XXXXX OIL & REFINING CORPORATION, a Wisconsin corporation ("Vendor"),
and B.T.L. of Illinois, INC., a corporation formed under the laws of the State
of Illinois ("Purchaser").
In order to induce the parties hereto to enter into the Asset Purchase
Agreement (as herein defined), and as additional consideration therefor, the
parties hereto agree as follows:
1. Definitions
1.1 Propane/Propylene. "Propane/Propylene" shall mean the product used
as a feedstock in Purchaser's cumene unit on Purchaser's property.
1.2 Vendor's Property. "Vendor's Property" shall mean the refinery
located generally in Blue Island, Illinois.
1.3 Purchaser's Property "Purchaser's Property" shall mean the chemical
plant purchased by Purchaser from Vendor, located generally in Blue Island,
Illinois.
1.4 Point of Delivery. "Point of Delivery" shall mean that point at
which Vendor shall deliver Propane/Propylene to Purchaser, which shall be at
the boundary of Purchaser's Property, or at such other point as may be
subsequently agreed upon in writing by the parties.
1.5 Force Majeure. "Force Majeure" shall mean any act of God or the
elements, accident, casualty, labor disturbances, unavailability or delays in
delivery of any product, labor, fuel, service or materials, failure or
breakdown of Vendor's Facilities or Purchaser's Facilities, or any other event
or condition beyond the reasonable control of Vendor or Purchaser.
1.6 Asset Purchase Agreement. "Asset Purchase Agreement" shall mean
the agreement by and among Xxxxx Chemical Corp., Vendor and Purchaser dated
July 3, 1985, as amended.
2. Sale, Delivery and Purchase of Propane/Propylene
2.1 Quantities. For the full term of this Agreement (as defined in
Paragraph 3 hereof), Vendor shall sell and deliver to Purchaser and Purchaser
shall buy from Vendor, Propane/Propylene to be used as a feedstock in
Purchaser's cumene unit on Purchaser's Property.
2.2 Deliveries. Vendor shall offer to sell to Purchaser such
quantities of Propane/Propylene as are needed as a feedstock for Purchaser's
existing cumene unit on Purchaser's Property.
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Said Propane/Propylene shall be measured with a positive displacement meter to
be installed on Vendor's Property.
3. Term. The term of this Agreement shall commence on the Closing
Date of the Asset Purchase Agreement and shall continue for a minimum period of
twenty (20) years ("Term"). Notwithstanding anything in the preceding sentence
to the contrary, at any time after the First two years of the Term, (a) Vendor
shall have the right to terminate this Agreement upon thirty (30) days prior
written notice if it sells all, or substantially all, of Vendor's Property or
permanently discontinues the operation thereof, and (b) Purchaser shall have the
right to terminate this Agreement upon thirty (30) days prior written notice if
it sells all or substantially all, of Purchaser's Property or permanently
discontinues the operation thereof.
4. Price and Payment.
4.1 Price. During the Term the price to be charged by Vendor to
Purchaser per gallon of Propane/Propylene delivered shall be equal to the sum
of the values of each of the components, Propane and Propylene, and shall be
calculated according to the concentration of each of the components in the
delivered stream. Each week Vendor shall sample the Propane/Propylene
delivered to Purchaser. Vendor shall analyze each sample with a laboratory
chromatograph to determine the Propane and Propylene content thereof. The
Propane content of each sample shall be multiplied by the metered volume for
the period sampled to determine the price to be charged by Vendor to Purchaser
as hereinabove set forth. The Propylene content and price shall be determined
in a like manner.
The price for both the Propylene and Propane shall be individually
quoted by Vendor no later than the first day of the month preceding the month
of delivery. The price quote by Vendor for Propane shall be equal to the price
Vendor is willing to pay to Purchaser for any Propane repurchased by Vendor
from Purchaser. Purchaser shall have until the fifteenth day of the month
preceding the month of delivery to accept the price and nominate the quantity
of Propane/Propylene that it will purchase at the quoted price. It is the
intent of Vendor that the price quoted to Purchaser for all Propane/Propylene
to be sold and delivered under this Agreement shall be at the alternative
alkylation value thereof to Vendor. Failure on the part of Purchaser to accept
an offer from Vendor during any month shall not terminate this Agreement.
4.2 Payment. Vendor shall invoice Purchaser on or before the 10th day
of each month for all Propane/Propylene sold and delivered to Purchaser during
the preceding calendar month. Purchaser shall pay said invoices on or before
the 15th day of
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the month in which they are rendered. Invoices that are not paid on or before
the due date shall bear interest at the rate of 1 1/2% per month. With each
invoice, Vendor shall furnish to Purchaser, a written statement showing the
actual volume and content of the Propane/Propylene delivered to Purchaser
during the preceding calendar month.
5. Passage of Title and Measurement.
5.1 Title. Title and risk of loss to Propane/Propylene shall pass to
Purchaser at the time of delivery and at the Point of Delivery.
5.2 Measuring Devices. Vendor shall maintain, repair and replace the
laboratory chromatograph and the positive displacement meters by performing
such routine checks and inspections as are deemed advisable in conformance with
standard industry practices. Vendor shall notify the Purchaser before making
any calibration tests so that the Purchaser may have a representative present.
Purchaser shall have the right at any and all reasonable times to check and
inspect charts and other records or measurements applicable to such
instruments.
5.3 Measurement of Propane/Propylene. The measurement of
Propane/Propylene delivered hereunder shall be performed at the expense of
Vendor and shall be computed in conformance with standard industry practices.
If the Purchaser shall have reason to question the accuracy of any gauge,
device or data used in measuring or computing either the volume or the
composition of the Propane/Propylene delivered hereunder at any time, Purchaser
shall so notify Vendor in writing. Within a reasonable time thereafter, such
gauge, device or data shall be tested in the presence of both parties, and if
such test shall reveal an inaccuracy of two percent (2)% or greater, the
quantity shall be recalculated and corrected for the period beginning fifteen
(15) days immediately prior to the date of said notice (or beginning on the
date such inaccuracy commenced, if ascertainable). If the gauge, device or
data are found to be accurate within manufacturer's meter accuracy, not to
exceed two percent (2%), then Purchaser shall bear the expense of tests made at
its request; otherwise, Vendor shall be responsible for the costs of such
tests.
6. Taxes. All sales, utility, or other tax, excise or assessment upon
or measured by Propane/Propylene sold or delivered to Purchaser hereunder, now
in existence or authorized in the future for collection by any governmental
agency or duly constituted authority, shall be paid entirely by Purchaser.
Should Vendor be required at any time to pay said sales or other tax, excise on
assessment on behalf of the Purchaser, Vendor shall notify Purchaser in
writing, stating the amount thereof, and Purchaser shall reimburse Vendor said
amount within fifteen (15) days from date of invoice. Invoices that are not
paid on or
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before the due date shall bear interest at the rate of 1 1/2% per month.
7. Permits, Rules and Regulations. The parties shall comply with all
laws, rules and regulations, whether federal, state or local, which are now or
which may in the future become applicable to the processing, sale, delivery and
use of the Propane/Propylene.
8. Laws and Force Majeure.
8.1 Laws and force Majeure. The provision of this Agreement shall be
subject to all valid and applicable federal, state, county, municipal and other
governmental laws, executive order, ordinances, rules, regulations and acts, and
neither party shall be held liable for damages for failure to comply herewith,
if compliance is prevented by, or the failure is the result of, any such law,
order, ordinance, rule, regulation or act, or due to Force Majeure.
8.2 Effect on Operations. If either party's operations are at any time
prevented or affected by any of the causes referred to in Paragraph 8.1, the
performance of its operations to the extent so prevented or affected shall be
excused without liability thereunder, and this Agreement shall continue in full
force and effect until either party is permitted to resume its operations and
thereafter for the balance of the Term hereof.
9. Default.
9.1 Default by Vendor. In the event that Purchaser concludes Vendor at
any time is failing to perform or observe any of the provisions of this
Agreement required to be performed or observed by Vendor, Purchaser shall
notify Vendor in writing of the facts relied upon as constituting a breach
hereof, and Vendor, if in default, shall have ninety (90) days after receipt of
such notice in which to complete or substantially complete compliance with
provisions. Purchaser shall have the right to terminate this Agreement upon
written notice to Vendor if Vendor fails to complete or substantially complete
such compliance efforts within the ninety (90) day period, unless such failure
is excused by the provisions of Section 8 hereof.
9.2 Default by Purchaser. In the event that Vendor concludes Purchaser
at any time is failing to perform or observe any of the provisions of Sections
4.2, 6, 7, 10 and 13.1 of this Agreement required to be performed or observed
by Purchaser, Vendor shall notify Purchaser in writing of the facts relied upon
as constituting a breach hereof, and Purchaser, if in default, shall have
ninety (90) days after receipt of such notice in which to complete or
substantially complete compliance with such provisions. Vendor shall have the
right to terminate this Agreement upon written notice to Purchaser if Purchaser
fails to complete or substantially complete such compliance efforts within
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the ninety (90) days period, unless such failure is excused by the provisions
of Section 8 hereof.
10. Indemnification. Purchaser shall defend, indemnify and hold
Vendor harmless from and against any and all claims, demands, actions,
proceedings, liability or losses, of whatsoever nature (including reasonable
attorney's fees) for injury or death to person(s) or for damage or loss to
property arising out of or caused by any act or omission by Purchaser or its
agents or representatives unless and to the extent such injury, damage or loss
is caused by the willful misconduct or negligence of Vendor. Vendor shall
defend, indemnify and hold Purchaser harmless from and against any and all
claims, demands, actions, proceedings, liability or losses, of whatsover nature
(including reasonable attorney's fees) for injury or death to person(s) or for
damage or loss to property arising out of or caused by an act or omission by
Vendor or its agents or representatives unless and to the extent that such
injury, damage or loss is caused by the willful misconduct or negligence of
Purchaser.
11. Assignment. Neither party hereto shall assign this Agreement in
whole or in part without first obtaining the consent, in writing, of the other
party, which consent shall not be unreasonably withheld, provided, however,
that Purchaser shall have the right to assign this Agreement without the
consent of Vendor to an affiliated or associated company, which assignment
shall not, however, release Purchaser from its obligations and liabilities
hereunder.
12. Notices. any notice to be given under this Agreement shall be in
writing and shall be deemed to have been properly given and received (i) when
delivered in person to the authorized representative of the party to whom the
notice is addressed, or (ii) on the date received as indicated on the return
receipt when sent by prepaid certified or registered mail, return receipt
requested, to the party to be notified at its address, as follows:
To Vendor: Xxxxx Oil & Refining Corporation
0000 Xxxxxxx Xxxx
Xx. Xxxxx, Xxxxxxxx 00000
Attention: Xxxx X. Xxxxxx
To Purchaser: BTL, Inc.
0000 Xxxxxxxxx xxxx
Xxxxxxxxxx, Xxxxxxx X0X 0X0
Attention: Xxxxx X.Xxxxxxxx
Either party may change such representative or address by giving written notice
of said change to the other party.
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13. General Provisions.
13.1 Attorney's Fees. In the event either party brings an action to
enforce the terms and conditions of this Agreement or to declare its rights
hereunder, the prevailing party in such action, on trial or appeal, shall be
entitled to its reasonable attorney's fees, to be paid by the other party.
13.2 Successors. subject to Section 11 hereof, the provisions of
this Agreement shall inure to the benefit of and be binding upon the parties
hereto and their respective successors and assigns.
13.3 Express Obligations. All obligations of Vendor and Purchaser
under this Agreement are expressly stated, and no other obligations of
covenants are to be implied hereunder.
13.4 Entire Contract. This Agreement is intended by the parties to
constitute a complete and exclusive expression of their contract with respect
to the subject matter hereof.
13.5 Modifications. This Agreement shall not be changed or modified
except by a subsequent agreement in writing signed by both parties.
13.6 Waiver. The waiver by either party of a failure on the part of
the other party to perform in accordance with any of the terms and conditions
of this Agreement shall not be construed as a waiver of any future or
continuing failure, whether similar or dissimilar thereto.
13.7 Applicable Law. This Agreement shall be construed under and in
accordance with the laws of the State of Illinois.
The parties have executed this Agreement this 16th day of September,
1985.
XXXXX OIL & REFINING CORPORATION
/s/
By:-----------------------------
B.T.L. OF ILLINOIS, INC.
/S/
By:-----------------------------
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[XXXXX OIL & REFINING CORPORATION LETTERHEAD]
September 20, 1990
Xx. Xxxxxxx X. Xxxxxxx
President
BTL Specialty Resins Corp.
0000 Xxxxxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxx Xxxxxx X0X0X0
Dear Wilf:
Attached is an executed copy of a letter agreement modifying our
Propane/Propylene agreement dated September 16, 1985.
Yours Truly,
/S/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
Enclosure
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[BLT SPECIALTY RESINS CORP. LETTERHEAD]
September 14, 1990
Xxxxx Oil & Refining Corporation
0000 Xxxxxxxx Xxxxxx
Xx. Xxxxx, Xxxxxxxx 00000
Attn: Xx. Xxxxxxx X. Xxxxxx
Vice President, Refining Operations
Dear Sirs:
Re: Propane/Propylene Agreement (the "Agreement") dated
September 16, 1985 between Xxxxx Oil & Refining
Corporation and BTL Specialty Resins Corp.
(successor in interest to BTL of Illinois, Inc.)
We are writing to confirm our agreement that Section 2.1 of the Agreement
shall be deleted and replaced with the following:
2.1 Quantities. For the full term of this Agreement (as
defined in Paragraph 3 hereof), Vendor shall sell and
deliver to Purchaser and Purchaser shall buy from
Vendor, Propane/Propylene to be used as a feedstock
in Purchaser's cumene unit on Purchaser's Property.
Notwithstanding the foregoing, nothing herein shall
prevent Purchaser from purchasing up to 25% of its
annual Propane/Propylene requirements for the cumene
unit on the Purchaser's Property from sources other
than the Vendor.
Please evidence your agreement with the foregoing amendment by signing and
returning the enclosed copy of this letter to us.
Yours truly,
/s/ Xxxxxxx X. Xxxxxxx
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Xxxxxxx X. Xxxxxxx
Agreed to this 20 day of Sept., 1990.
Xxxxx Oil & Refining Corporation
/s/ Xxxxxxx X. Xxxxxx
By: --------------------------
