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EXHIBIT 10.26
AGREEMENT ("Agreement") dated as of May 7, 1997 by and among UNION CARBIDE
CORPORATION, a New York corporation formerly known as Union Carbide Chemicals
and Plastics Company Inc. ("UCC") with offices at ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇; D-S SPLITTER, INC., a Delaware corporation ("D-S")
with offices at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇; JLM
INDUSTRIES, INC., a Delaware corporation ("JLM") with offices at ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇; and OLEFINS TERMINAL CORPORATION, a
Delaware corporation (the "OTC") with offices at Houston, Texas. UCC, D-S and
JLM are sometimes referred to herein collectively as the "Note Purchasers".
W I T N E S S E T H:
WHEREAS, UCC, D-S, JLM, and OTC entered into a Note, Stock and Warrant
Purchase Agreement dated August 15,1991 (hereinafter called the "Purchase
Agreement") pursuant to which D-S and JLM purchased shares of common stock of
OTC, UCC purchased a warrant for the purchase of shares of common stock of OTC
and the Note Purchasers purchased subordinated notes of OTC;
WHEREAS, OTC on August 15, 1991 entered into a Credit Agreement (the
"Credit Agreement") with Bank of America National Trust and Savings Association
("Bank of America") as Agent for the Banks (as such term is defined therein)
(the "Agent,") under which the Agent agreed to make available to OTC a term
credit facility and a debt service facility (together, the "Credit Facility");
WHEREAS, The Company used the proceeds from such purchases and from the
Credit Facility to finance the development and construction of a polymer grade
propylene storage and terminal facility (the "Facility") located at Seabrook,
Texas on property owned by Baytank (Houston), Inc.;
WHEREAS, in connection with the Credit Facility, D-S, UCC and JLM entered
into the Support Agreement dated August 15, 1991 (the "Support Agreement") for
the benefit of OTC and Bank of America pursuant to which D-S, UCC and JLM each
agreed to invest in OTC certain additional amounts to be used to fund repayment
of OTC's obligations under the Credit Agreement;
WHEREAS, OTC proposes to refinance and repay in obligations under the
Credit Facility;
WHEREAS, D-S, UCC, JLM, OTC and Bank of America have agreed that in
connection with OTC's repayment of the Credit Facility the Purchased Note of OTC
held by UCC will be repaid in full by OTC, the warrant for shares of OTC common
stock held by UCC will be returned to OTC and be canceled, UCC's obligations
under
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the Support Agreement will be terminated and extinguished and UCC will receive
the transferable and assignable right to use the Facility for up to 100,000
metric tons of throughput of polymer grade propylene; and
WHEREAS, all the parties wish to enter into this Agreement to provide for
the foregoing;
NOW, THEREFORE, the parties agree as follows:
1. Definitions
Unless otherwise defined herein, all terms with initial capitalization
shall have the meanings given to them in the Purchase Agreement, a copy of
which is attached hereto as Exhibit "A".
2. Repayment of UCC's Note
Notwithstanding the provisions of the Purchase Agreement including,
but not limited to Section 2 thereof, OTC shall, on or before May 13, 1997,
pay UCC the face amount of the Purchased Note which it purchased pursuant
to the Purchase Agreement plus accrued interest thereon as specified In the
Purchased Note in the total amount of US $2,200,000 and UCC shall
thereafter surrender its Purchased Note to OTC by depositing same with a
reputable air courier company for delivery to OTC.
3. The Warrant
On or before May 13, 1997, OTC and D-S shall execute the Terminal
Agreement in the form attached hereto as Exhibit B together with the
appended Pipeline Agreement pursuant to which UCC shall receive the
transferable and assignable right to use the Facility for up to 100,000
metric tons of throughput and UCC shall surrender the Warrant to OTC by
depositing same with a reputable air courier company for delivery to OTC.
4. UCC's SUPPORT OBLIGATIONS
In consideration of UCC's undertakings pursuant to Articles 2 and 3
hereof, OTC shall cause UCC's obligations under the Support Agreement to be
totally and fully extinguished by execution by Bank of America of a release
in a form acceptable to UCC and delivery thereof to UCC on or prior to May
13, 1997.
5. Payment to Olefins Marketing
Upon receipt by UCC of the sum of $2.2 MM and a fully executed
original of the Terminal Agreement and of the appended Pipeline Agreement,
UCC shall pay to Olefins Marketing Inc. the sum of $100,000 as provided in
the Settlement Agreement of the OMI/UCC litigation dated September 12,1996.
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6. INDEMNIFICATION
JLM, D-S, and OTC (for purposes of this Article the "Indemnitors")
(a) hereby waive any claims against UCC resulting from or arising out
of, and
(b) shall jointly and severally defend, indemnify and hold harmless
UCC from and against
any and all liability, loss, damage, expense, including attorneys fees,
causes of action, suits, claims or judgments, of any nature whatsoever,
resulting from or arising out of the incorporation, financing,
refinancing, operations or business or other activities of OTC, including
but not limited to any alleged liabilities pursuant to the Purchase
Agreement, the Warrant-holders/Stockholders Agreement, the Support
Agreement and the Terminal and Service Agreement and Indemnitors shall
defend or settle at their own expense any suit or action which may be
brought against UCC with respect to any such claim or liability; provided,
however, that UCC shall have given prompt notice in writing to Indemnitors
of any claim and of the bringing, or any written threat of the bringing of
any such suit or action, and shall permit Indemnitors by their counsel to
defend or settle the same; and, provided, further, that UCC shall not
settle or compromise any such suit or action without the prior written
consent of Indemnitors.
IN WITNESS WHEREOF, the parties have duly executed and delivered this
Agreement as of the date first above written.
UNION CARBIDE CORPORATION JLM INDUSTRIES, INC.
By:/s/ By:/s/
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Title:/s/ Title:/s/
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OLEFINS TERMINAL CORPORATION D-S SPLITTER, INC.
By:/s/ By:/s/
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Title:/s/ Title:/s/
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