Exhibit 10.12
Execution Copy
 
 
FABA PET BOTTLE SUPPLY AGREEMENT
 
THIS IS A FABA PET BOTTLE SUPPLY AGREEMENT (the “Agreement”), dated as of
November 12, 2002, by and among Faba Sirma SPA, an indirect subsidiary of Crown
(“Supplier”) and Constar Plastics of Italy S.r.l., an indirect subsidiary of
Constar (“Purchaser”).
 
Background
 
Supplier will supply directly to the Constar Customers on Purchaser’s behalf and
Purchaser will purchase from Supplier on the terms and conditions set forth
herein, PET Bottles blown at Supplier’s facility in Reggio Emilia, Italy (the
“Faba Facility”).
 
Terms
 
NOW, THEREFORE, in consideration of the mutual covenants herein and intending to
be legally bound hereby, the parties hereto agree as follows:
 
ARTICLE I
 
DEFINITIONS
 
1.1.    Certain Definitions.  Capitalized terms not defined in this Agreement
shall have the meanings ascribed to them in the Corporate Agreement, dated as of
the date hereof, between Crown and Constar. As used in this Agreement, the
following terms shall have the respective meanings set forth below:
 
1.1.1. “AAA” has the meaning set forth in Section 7.4.
 
1.1.2.    “Affiliate” of any Person means any Person, directly or indirectly,
controlling, controlled by or under common control with such Person.
 
1.1.3. “Agreement” has the meaning set forth in the preamble to the Agreement.
 
1.1.4. “Bankruptcy Event” means with respect to any party, as applicable, (a)
the making by such party of any assignment for the benefit of creditors of all
or substantially all of its assets or the admission by such party in writing of
inability to pay all or substantially all of its debts as they become due; (b)
the adjudication of such party as bankrupt or insolvent or the filing by such
party of a petition or application to any tribunal for the appointment of a
trustee or receiver for such party or any substantial part of the assets of such
party; or (c) the commencement of any voluntary or involuntary bankruptcy
proceedings (and, with respect to involuntary bankruptcy proceedings, the
failure to be discharged within 60 days), reorganization

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proceedings or similar proceeding with respect to such party or the entry of an
order appointing a trustee or receiver or approving a petition in any such
proceeding.
 
1.1.5. “Business Day” shall mean any day other than a Saturday, a Sunday or a
day on which banks in Rome, Italy are authorized or obligated by law or
executive order to not open or remain closed.
 
1.1.6. “Constar” means Constar International Inc., a Delaware corporation.
 
1.1.7. “Constar Customers” has the meaning set forth in Section 2.1.
 
1.1.8. “Control,” “controlled by” and “under common control with”, as applied to
any Person, means the possession, directly or indirectly, of the power to direct
the vote of a majority of the votes that may be cast in the election of
directors (or other Persons acting in similar capacities) of such Person or
otherwise to direct or cause the direction of the management and policies of
such Person, whether through the ownership of voting securities or by contract
or otherwise.
 
1.1.9. “Crown” means Crown Cork & Seal Company, Inc., a Pennsylvania
corporation.
 
1.1.10. “Faba Facility” has the meaning set forth in the Background section of
this Agreement.
 
1.1.11. “Force Majeure Event” has the meaning set forth in Section 6.4.
 
1.1.12. “Initial Term” has the meaning set forth in Section 6.1.
 
1.1.13. “Molds” has the meaning set forth in Section 5.1.
 
1.1.14. “Person” means an individual, a corporation, a partnership, an
association, a governmental entity, a trust or other entity or organization.
 
1.1.15. “PET” shall mean polyethylene terephthalate.
 
1.1.16. “PET Bottles” means all PET Bottles blown at the Faba Facility as of the
Initial Public Offering Date, which types of PET Bottles are set forth, for the
avoidance of doubt, on Schedule A hereto (the “Existing PET Bottles”). PET
Bottles shall also include any other PET Bottles that are identified and
mutually agreed upon by Supplier and Purchaser after the Initial Public Offering
Date from time to time (the “New PET Bottles”).
 
1.1.17. “Production Request” has the meaning set forth in Section 2.1.
 
1.1.18. “Purchaser” has the meaning set forth in the preamble to this Agreement.
 
1.1.19. “Release Request” has the meaning set forth in Section 2.1.

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1.1.20. “Supplier” has the meaning set forth in the preamble to the Agreement.
 
1.1.21. “Term” has the meaning set forth in Section 6.1.
 
1.1.22. “Transfer Date” has the meaning set forth in Section 5.1.
 
ARTICLE II
 
PURCHASE OF REQUIREMENTS
 
2.1.     Purchase Requirements.
 
(a)  Subject to the other provisions of this Article II, Purchaser agrees to
purchase from Supplier 100% of Purchaser’s requirements for PET Bottles for
Purchaser’s customers specified on Schedule B hereto (the “Constar Customers”).
 
(b)  At least 31 days prior to the beginning of each year, Purchaser shall
provide Supplier with a non-binding forecast for the PET Bottles that it will
purchase from Supplier during such year, which shall represent a good faith
estimate of Purchaser’s requirements for PET Bottles for the Constar Customers.
On or before the 15th day of each month, Purchaser shall submit a firm order for
production during the following month (a “Production Request”), which shall not
exceed the maximum capacity of the Sidel SBO-10 blowing machine located at the
Faba Facility, and a non-binding forecast for the following two months, which
forecast shall represent a good faith estimate of Purchaser’s requirements for
such two months. Purchaser shall be deemed to purchase, and shall be responsible
for payment to Supplier for, any PET Bottles blown by Supplier in response to a
Production Request, regardless of whether Purchaser submits a Release Request
for such PET Bottles. In addition, to maximize utilization of the Faba Facility,
Supplier may blow PET Bottles based upon Purchaser’s non-binding forecasts. If
Purchaser provides its written consent to such production, Purchaser shall be
deemed to purchase, and shall be responsible for payment to Supplier for, any
PET Bottles blown by Supplier in response to such forecast, regardless of
whether Purchaser submits a Release Request for such PET Bottles. At any time
that Supplier is holding greater than 5 million PET Bottles in inventory at the
Faba Facility in response to Production Requests or approved production based on
Purchaser’s forecasts, Supplier shall promptly notify Purchaser of the number
and type of PET Bottles held in inventory and shall not be obligated to accept
Production Requests or to produce and hold PET Bottles until such inventory is
reduced below 5 million PET Bottles.
 
(c)  From time to time Purchaser may submit requests to release PET Bottles for
shipment (“Release Requests”) to Supplier. So long as the aggregate amount of
PET Bottles released during a month does not exceed that month’s Production
Request and agreed existing stockholdings, Supplier shall satisfy any Release
Request; provided, that Supplier shall not be obligated, but shall use
commercially reasonable efforts, to ship PET Bottles pursuant to a Release
Request on less than 5 days notice. In the event that the aggregate amount of
PET Bottles requested for release during a month exceeds that month’s Production
Request and agreed existing stockholdings, Supplier shall use its commercially
reasonable efforts to satisfy

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the Release Request. With respect to Release Requests that (in the aggregate, if
applicable) do not exceed the relevant month’s Production Request, Supplier will
ship no less than 95% of the released PET Bottles to the Constar Customers or to
any other location directed by Purchaser, OTIF (on time, in full). The
measurement of OTIF shipments shall conform to historic practices at Constar
facilities located in Europe. If Supplier is unable to satisfy a Release
Request, Supplier shall promptly notify Purchaser. If Supplier is unable to
satisfy a Release Request that (in the aggregate, if applicable) did not exceed
the relevant month’s Production Request and Purchaser is able to secure an
alternative supply, such PET Bottles shall not be included in calculating the
requirements commitment in clause (a) above. Purchaser shall be deemed to
purchase, and shall be responsible for payment to Supplier for, any PET Bottles
shipped by Supplier in response to a Release Request, regardless of whether the
Constar Customer ultimately pays Purchaser for such PET Bottles. Supplier shall
not be responsible for collecting payment from the Constar Customers for PET
Bottles blown and shipped hereunder.
 
(d)  Purchaser shall provide Supplier, or shall direct the Constar Customers to
provide Supplier, at Supplier’s cost, with multi-layer PET preforms necessary to
blow any multi-layer PET Bottles. In addition, Purchaser may, at its option,
provide Supplier, or direct the Constar Customers to provide Supplier, at
Supplier’s cost, with monolayer PET preforms necessary to blow monolayer PET
Bottles. All invoices from Purchaser to Supplier for multi-layer or monolayer
preforms shall be paid by Supplier on or before the last day of the month
containing the date which is 100 days after the invoice date. Supplier shall not
be deemed to breach this Agreement as a result of, and shall have no liability
to Purchaser for, any failure to perform its obligations hereunder that results
from the failure of Purchaser to provide Supplier with multi-layer PET preforms
or, if Purchaser so elects, monolayer PET preforms necessary to blow PET
Bottles.
 
(e)  Within 30 calendar days of the end of each three-month period ending March
31, June 30, September 30 and December 31 of each year during the Term,
Purchaser shall provide Supplier a certificate from a member of it’s senior
management attesting to Purchaser’s conformance to its obligations under Section
2.1(a) of this Agreement during such three-month period. If Purchaser does not
provide such certificate to Supplier within such 30 calendar day period or upon
Supplier’s request, Purchaser shall permit Supplier’s outside accountants to
access the books and records of Purchaser in order to review the books and
records relating to purchases of such PET Bottles by the Constar Customers.
 
(f)  Notwithstanding the foregoing, Supplier shall not be required to blow
and/or ship any specific PET Bottles if Supplier reasonably determines that any
such blowing or shipping will result in a material violation of any applicable
governmental laws or regulations.
 
(g)  The parties agree to use good faith efforts to modify the provisions of
this Section 2 if either party is unsatisfied with the operation of such
provisions; provided, that no party shall be under any obligation to agree to
any such changes.

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ARTICLE III
 
PRICE
 
3.1.    Pricing.  (a) For Existing PET Bottles, Purchaser will pay to Supplier
the prices set forth on Schedule A hereto for the relevant PET Bottles purchased
pursuant to this Agreement.
 
(b) For New PET Bottles, mutually agreeable pricing will be established between
Supplier and Purchaser on a case-by-case basis. Supplier shall have no
obligation to supply, and Purchaser shall have no obligation to purchase, New
PET Bottles for which pricing cannot be agreed upon and any such New PET Bottles
shall not be calculated in the requirements commitment set forth in Section
2.1(a). If pricing of New PET Bottles is agreed upon, such New PET Bottles shall
be calculated in such requirements commitment.
 
(c) In the event that Supplier is unable to blow multi-layer beer bottles that
meet the specifications of the Constar Customers, Purchaser shall provide
commercially reasonable technical support to assist Supplier in meeting those
standards. If, after the provision of such support for a period of at least 14
days, Supplier is unable to meet the multi-layer specifications, the parties
will negotiate in good faith to establish specifications that Supplier can
reasonably meet and shall adjust the price for such multi-layer beer bottles
accordingly.
 
ARTICLE IV
 
DELIVERY
 
4.1.    Delivery.  Delivery of all PET Bottles sold under this Agreement shall
be F.O.B. Supplier at the Faba Facility. Title and risk of loss or damages to
all PET Bottles shall pass to Purchaser upon shipment, F.O.B. point, by Supplier
to Purchaser. Purchaser shall pay for all freight and other costs associated
with shipment of PET Bottles to the location of delivery. For PET Bottles
delivered F.O.B. Supplier, Supplier shall furnish the facilities and personnel
for loading PET Bottles at the F.O.B. point.
 
4.2.    Payment.  Supplier shall provide invoices to Purchaser for PET Bottles
and, if applicable, shipping or other charges upon the earlier of (i) release of
such PET Bottles pursuant to a Release Request or (ii) 90 days from the date of
acceptance of the Production Request pursuant to which such PET Bottles were
produced. All invoices from Supplier to Purchaser for PET Bottles shall be paid
by Purchaser on or before the last day of the month containing the date which is
40 days after the invoice date.

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ARTICLE V
 
MOLDS
 
5.1.    Provision of Molds.  The injection and blow molds necessary to blow the
PET Bottles (the “Molds”), as specified on Schedule C, shall be provided to
Supplier by Purchaser or by a Constar Customer at Purchaser’s direction. The
Molds shall remain the property of Purchaser or the Constar Customer, as the
case may be, and shall be held at the Faba Facility by Supplier. Within 90 days
after the last day of the Term, Purchaser shall remove, at its expense, and
shall be solely responsible for removing, the Molds from the Faba Facility (the
“Transfer Date”). Purchaser shall provide Supplier with written notice of the
Transfer Date at least 60 Business Days prior to the Transfer Date. If the Molds
shall not be removed on or prior to the Transfer Date, Purchaser shall reimburse
Supplier all costs and expenses incurred by Supplier on account of maintaining
and storing the Molds at the Faba Facility, and any other incidental,
consequential or other damages or losses incurred by Supplier as a result of
such non-removal until Purchaser removes the Molds. Notwithstanding the
preceding sentence or anything else in this Agreement to the contrary, Supplier
shall have no responsibilities or obligations of any kind, including, without
limitation, as to operation, storage, insurance or maintenance, with respect to
the Molds after the Transfer Date.
 
5.2.    Insurance.  Supplier shall maintain adequate insurance with respect to
the Molds insuring against such risks customarily insured against in accordance
with Supplier’s practice until their removal from the Faba Facility by Purchaser
in accordance with Section 5.1 or until 90 days after the Term, whichever is
earlier. Supplier shall, upon Purchaser’s reasonable request, provide evidence
of insurance and appropriate loss payable endorsements in favor of Purchaser.
Supplier hereby assumes and shall bear the entire risk of damage, whether or not
insured against, of the Molds arising out of the operation of the Molds while
such Molds are in the possession of Supplier or arising out of Supplier’s breach
of this Agreement, negligence or willful misconduct.
 
5.3.    Maintenance and Improvements.  During the Term, Supplier shall perform
all maintenance, excluding mold refurbishments, reasonably required to keep the
Molds in good operating order, repair, condition and appearance and in
accordance with normal industry standards, normal wear and tear and impairments
of value excepted. Purchaser shall be responsible for the cost of repairing or
replacing any Molds that are defective or malfunctioning (except to the extent
that such defects or malfunctions arise as a result of Supplier’s failure to
maintain the Molds in accordance with the first sentence of this Section 5.3).
Any modifications, refurbishments or improvements to the Molds shall be made,
and any new Molds necessary to blow PET Bottles shall be provided, by Purchaser
at no cost to Supplier.
 
5.4.    Access.  Prior to the Transfer Date, representatives of Purchaser may,
at their own expense, during normal business hours and upon reasonable notice,
inspect the Molds and have access to the employees whose primary
responsibilities relate to the blowing of PET Bottles

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hereunder; provided, that a representative of Supplier shall be present at all
such times; and, provided, further, that no exercise of such inspection shall
materially interfere with the normal operation of the Molds or the business of
Supplier.
 
5.5.    Permitted Use.  Supplier shall not use the Molds for any use other than
the production of PET Bottles for Purchaser hereunder.
 
ARTICLE VI
 
TERM, DEFAULT AND OTHER PROVISIONS
 
6.1.    Term.  This Agreement shall commence upon the Initial Public Offering
Date and shall continue until December 31, 2003 (the “Initial Term”). Purchaser
may, at its option, extend the Initial Term until June 30, 2004 on the terms
contained herein (the Initial Term, as so extended, the “Term”), by giving
Supplier written notice of such extension no more than 120 or less than 60 days
written notice thereof.
 
6.2.    Events of Default.  (a) The following shall be considered events of
default and shall give rise to a right of Supplier to terminate this Agreement
within 45 days of Supplier’s discovery of such event of default: (i) Purchaser
fails to make timely payments for invoiced PET Bottles, subject to a 30-day cure
period after notice regarding such breach, (ii) Purchaser materially breaches
any other applicable provision of this Agreement, subject to a 30-day cure
period after notice regarding such breach or (iii) Purchaser or Constar
experiences a change of Control such that Purchaser or Constar is controlled by
a competitor of either Constar or Crown (provided that such termination shall
not be effective until six months from the date of the Change of Control). If
Purchaser or Constar suffers a Bankruptcy Event, Supplier shall have the right
to unilaterally make reasonable modifications to the payment terms set forth in
Section 4.2 of the Agreement at any time after such Bankruptcy Event. Supplier
shall promptly notify Purchaser of any such modifications to the payment terms
of this Agreement.
 
(b)  The following shall be considered events of default and shall give rise to
a right of Purchaser to terminate this Agreement within 45 days of Purchaser’s
discovery of such event of default: (i) Supplier materially breaches any
applicable provision of this Agreement, subject to a 30-day cure period after
notice regarding such breach or (ii) Supplier or Crown experiences a change of
Control such that Supplier or Crown is controlled by a competitor of either
Constar or Crown (provided that such termination shall not be effective until
six months from the date of the Change of Control).
 
(c)  Each party shall provide the other party with prompt notice upon discovery
of a default by the other party; provided, that failure to give such notice
shall not limit or restrict the ability of a party to terminate this Agreement
subject to the cure periods provided in this Section 6.2.
 
6.3.    No Waiver.  If the party not in default continues to make or accept
shipments, as the case may be, despite the other party’s default, such action
shall not constitute a waiver of the

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default, or in any way affect the rights under this Agreement of the party not
in default. A waiver by either party of any breach of any provision shall not
constitute a waiver of any other breach of such provision or of any other
provision.
 
6.4.    Force Majeure.  Neither Supplier nor Purchaser shall be responsible for
any failure or delay in performance due to causes beyond the reasonable control
of the affected party that render performance commercially impracticable (a
“Force Majeure Event”). Any party, if affected by any such cause, may, upon
written notice to the other specifying the reasons therefor, reduce its
obligations to the other by an amount not in excess of the quantity that it is
unable to deliver or purchase due to such cause. In the event such a curtailment
by either party continues in whole or in part for a period of 5 continuous days,
then, in the case of a Supplier Force Majeure Event, Purchaser may arrange for
temporary supply of its requirements until Supplier can resume delivery of PET
Bottles to Purchaser, and, in the case of a Purchaser Force Majeure Event,
Purchaser shall use its best efforts to sell to third parties those PET Bottles
which would have been delivered to the Constar Customers on Purchaser’s behalf
(in accordance with Purchaser’s delivery schedule) in the absence of such
curtailment. Notwithstanding anything to the contrary in this Agreement, this
provision shall not apply to or otherwise excuse the failure to pay any
uncontested costs or fees due under this Agreement when due (including payment
for PET Bottles produced in accordance with Section 2.1(b), regardless of
whether Purchaser submits a Release Request for such PET Bottles).
 
6.5.    Warranty; Limitation of Liability.  (a) Supplier warrants that all PET
Bottles sold to Purchaser (i) shall be free from defects in workmanship and
materials, except for any defects arising out of actions taken by or at the
direction of Purchaser or materials provided by or on behalf of Purchaser and
(ii) shall comply with the historical specifications for Existing PET Bottles
and with any agreed upon specifications for New PET Bottles. Supplier’s
liability under this warranty, whether in contract or tort, shall be limited
exclusively to the repayment of the purchase price of the defective PET Bottles.
Supplier will make no other warranties with respect to the PET Bottles. OTHER
THAN THE ABOVE WARRANTY, SUPPLIER MAKES NO WARRANTY, WHETHER OF MERCHANTABILITY,
FITNESS OR OTHERWISE, EXPRESS OR IMPLIED, IN FACT OR BY LAW, AND SUPPLIER SHALL
HAVE NO FURTHER OBLIGATION OR LIABILITY UNDER THE ABOVE WARRANTY OR WITH RESPECT
TO THE PET BOTTLES. SUBJECT TO THE FOLLOWING SENTENCE, SUPPLIER SHALL IN NO
EVENT BE LIABLE FOR PUNITIVE, CONSEQUENTIAL OR INCIDENTAL DAMAGES.
 
(b)  Purchaser agrees to waive all claims for shortages in the PET Bottles
ordered and received hereunder unless such claims are submitted in writing to
Supplier within 30 days after receipt of notice from the Constar Customer of
such shortage.
 
(c)  Subject to the above provisions, Purchaser shall not bring any other action
arising hereunder unless such action is brought within one year after the date
such cause of action accrues.

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(d)  Supplier shall not be liable for, and Purchaser assumes responsibility for,
all personal injury and property damage resulting from the handling, possession,
use or resale of the PET Bottles produced hereunder after such PET Bottles are
delivered to the Constar Customer, whether the same is used alone or in
combination with other substances, except to the extent any such personal injury
or property damage results from the willful misconduct of Supplier.
 
6.6.    Confidentiality; Disclosures.
 
6.6.1.    Confidentiality.  The parties agree (a) to maintain all information,
whether in written, oral, electronic or other form, necessary for or utilized or
received pursuant to any terms of this Agreement, as the case may be, including,
without limitation, prices, cost components, payment terms, technical knowledge,
features, know-how, material, manufacturing, Release Requests, Production
Requests, tooling and equipment specifications and other information necessary
to carry out the terms of this Agreement, as the case may be (the “Confidential
Information”), as secret and confidential and (b) not to disclose the
Confidential Information to any third person or party (except for employees,
counsel, contractors, customers, consultants or vendors who have a need to know
and are informed of the confidential nature of such information by the
disclosing party). Each party shall accept responsibility and be liable for any
disclosure by any third person of any Confidential Information disclosed to such
third person by such party. The parties will use the same measures to maintain
the confidentiality of the Confidential Information of any other party in its
possession or control that it uses to maintain the confidentiality of its own
Confidential Information of similar type and importance. Notwithstanding the
foregoing, either party or their Affiliates may describe this Agreement in, and
include this Agreement with, filings with the U.S. Securities and Exchange
Commission and any related prospectuses, including such filings or prospectuses
in connection with any offering of securities. Confidential Information will not
include information that (i) is in or enters the public domain without breach of
this Agreement, or (ii) the receiving party lawfully receives from a third party
without restriction on disclosure and, to the receiving party’s knowledge,
without breach of a nondisclosure obligation.
 
6.6.2.    Disclosure to Governmental Agency.  Notwithstanding the foregoing,
each party shall be permitted to disclose the Confidential Information and/or
any portion thereof (i) to a governmental agency or authority as required in
response to a subpoena therefor, (ii) in connection with formal requests for
discovery under applicable rules of civil procedure in a legal action before a
court of competent jurisdiction to which such party is a party and (iii) as
otherwise required by law; provided, however, that, in any such case, each party
shall notify the other party as early as reasonably practicable prior to
disclosure to allow such party to take appropriate measures to preserve the
confidentiality of such information at the expense of such party.
 
6.6.3.    Ownership of Information.  All Confidential Information supplied or
developed by either party will be and remain the sole and exclusive property of
the party who

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supplied or developed it; provided, however, that any inventions, discoveries,
technical knowledge or know-how relating to the manufacture or sale of PET
Bottles or containers and arising from the Molds or the production of PET
Bottles pursuant to this Agreement shall belong exclusively to Purchaser and
Supplier hereby irrevocably and unconditionally assigns and transfers to
Purchaser all rights of every kind, nature or description that Supplier may have
in or to such inventions, discoveries, technological knowledge or know-how.
 
6.6.4    Return of Confidential Information.  Upon the written request of a
party which has disclosed information covered by Section 6.6 in written, printed
or other tangible form, all such readily available information and all copies
thereof, including samples or materials, and all notes or other materials
derived from such information shall be returned to the party which disclosed
such information.
 
6.7.    Right of Setoff.  Purchaser and Supplier shall waive all rights of
setoff and recoupment either may have against the other or any of the other’s
Affiliates with respect to all amounts which may be owed from time to time
pursuant to this Agreement.
 
6.8.    Indemnification.    With respect to PET Bottles blown by Supplier
pursuant to this Agreement, Purchaser shall defend, indemnify and hold Supplier
and its Affiliates and their respective officers, directors, employees,
successors and permitted assigns harmless against any and all liability, damage,
loss, cost or expense arising out of (i) the manufacture, use or sale of such
PET Bottles or any products liability arising therefrom (except any liability
directly related to and directly caused by the gross negligence or willful
misconduct of Supplier in manufacturing the PET Bottles) and (ii) all claims,
suits or actions for bodily injuries suffered in connection with the operations
or maintenance of the Molds and arising out of Purchaser’s breach of this
Agreement, negligence or willful misconduct. Furthermore, Purchaser shall
indemnify, defend and hold Supplier and its Affiliates and their respective
officers, directors, employees, successors and permitted assigns harmless
against all damages, claims, judgments, decrees, costs, expenses and demands for
unfair competition or infringement of any United States or foreign trademark or
copyright as a direct result of Supplier’s manufacture of PET Bottles for
Purchaser conforming to the specifications required by Purchaser or the failure
of such conforming PET Bottles to comply with any federal, state, local or other
law or regulation. Supplier shall not settle any claim for which it is entitled
to indemnification hereunder without the written consent of Purchaser, which
consent shall not be unreasonably withheld.
 
ARTICLE VII
 
MISCELLANEOUS
7.1.    Notices.
 
All notices and other communications required or permitted hereunder shall be in
writing, shall be deemed duly given upon actual receipt, and shall be delivered
(a) in person, (b) by registered or certified mail, postage prepaid, return
receipt requested or (c) by facsimile or other generally accepted means of
electronic transmission (provided that a copy of any notice

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delivered pursuant to this clause (c) shall also be sent pursuant to clause
(b)), addressed as follows:
 
if to Purchaser, to:
 
Constar International Inc.
One Crown Way
Philadelphia, PA 19154-4599
Attention:
Facsimile:
 
if to Supplier, to:
 
Faba Sirma SPA
Sant’llario d’Enza (Reggio Emilia)
Stada XXV Luglio, 172
Italy
Attention: Paolo Minardi
Facsimile:
 
with a copy to:
 
Crown Cork & Seal Company, Inc.
One Crown Way
Philadelphia, PA 19154
Attention:
Facsimile:
 
or to such other addresses or telecopy numbers as may be specified by like
notice to the other parties.
 
7.2.    Independent Contractor.  None of the parties is now, nor shall it be
made by this Agreement, an agent or legal representative of the other party for
any purpose, and neither party has any right or authority to create any
obligation, express or implied, on behalf of the other party, to accept any
service of process upon it, or to receive any notices of any kind on its behalf.
All activities by Supplier hereunder shall be carried on by Supplier as an
independent contractor and not as an agent for Purchaser.
 
7.3.    Governing Law.  This Agreement shall be governed by and construed in
accordance with the laws of the Commonwealth of Pennsylvania.
 
7.4.    Dispute Resolution: Negotiation and Arbitration.
 
7.4.1.  The parties shall attempt to resolve any dispute arising out of or
relating to this Agreement promptly by negotiation in good faith between
executives who have authority to

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settle the dispute. A party shall give the other party written notice of any
dispute not resolved in the ordinary course of business. Within 10 Business Days
after delivery of such notice, the party receiving notice shall submit to the
other a written response thereto. The notice and the response shall include: (i)
a statement of each party’s position(s) regarding the matter(s) in dispute and a
summary of arguments in support thereof, and (ii) the name and title of the
executive who will represent that party and any other Person who will accompany
that executive.
 
7.4.2.  Within 10 Business Days after delivery of the notice, the designated
executives shall meet at a mutually acceptable time and place, and thereafter,
as often as they reasonably deem necessary, to attempt to resolve the dispute.
All reasonable requests for information made by one party to any other shall be
honored in a timely fashion. All negotiations conducted pursuant to this Section
7.4 (and any of the parties’ submissions in contemplation hereof) shall be
deemed Confidential Information and shall be treated by the parties and their
representatives as compromise and settlement negotiations under the United
States Federal Rules of Evidence and any similar state rules.
 
7.4.3.  If the matter in dispute has not been resolved within 30 days after the
first meeting of the executives to attempt to resolve the dispute, either party
may submit the dispute to binding arbitration to the Philadelphia, Pennsylvania
office of the American Arbitration Association (“AAA”) in accordance with the
procedures set forth in the Commercial Arbitration Rules of the AAA.
 
7.4.4.  The Commercial Arbitration Rules of the AAA, as modified or revised by
the provisions of this Section 7.4, shall govern any arbitration proceeding
hereunder. The arbitration shall be conducted by three arbitrators selected
pursuant to Rule 13 of the Commercial Arbitration Rules, and pre-hearing
discovery shall be permitted if and only to the extent determined by the
arbitrator to be necessary in order to effectuate resolution of the matter in
dispute. The arbitrator’s decision shall be rendered within 30 days of the
conclusion of any hearing hereunder and the arbitrator’s judgment and award may
be entered and enforced in any court of competent jurisdiction.
 
7.4.5.  Resolution of disputes under the procedures of this Section 7.4 shall be
the sole and exclusive means of resolving disputes arising out of or relating to
this Agreement; provided, however, that nothing herein shall preclude the
Parties from seeking in any court of competent jurisdiction temporary or interim
injunctive relief to the extent necessary to preserve the subject matter of the
dispute pending resolution under this Section 7.4.
 
7.5.  Consent to Jurisdiction.
 
Supplier and Purchaser hereby agree and consent to be subject to the exclusive
jurisdiction of the United States District Court for the Eastern District of
Pennsylvania, and in the absence of such Federal jurisdiction, the parties
consent to be subject to the exclusive jurisdiction of any state court located
in the City of Philadelphia and hereby waive the right to assert the lack of
personal or subject matter jurisdiction or improper venue in connection with any
such suit, action or other proceeding. In furtherance of the foregoing, each of
the parties (i) waives the

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defense of inconvenient forum, (ii) agrees not to commence any suit, action or
other proceeding arising out of this Agreement or any transactions contemplated
hereby other than in any such court (other than the mandatory submission to
arbitration in accordance with Section 7.4), and (iii) agrees that a final
judgment in any such suit, action or other proceeding shall be conclusive and
may be enforced in other jurisdictions by suit or judgment or in any other
manner provided by law.
 
7.6.    Entire Agreement.  This Agreement constitutes the entire understanding
of the parties hereto with respect to the subject matter hereof and supersedes
any prior agreement or understanding, written or oral, relating to the subject
matter of this Agreement.
 
7.7.    Successors/No Third Party Beneficiaries.  This Agreement shall not be
assignable, except that (i) Supplier may, after giving notice to Purchaser,
assign its rights and obligations under this Agreement so long as the assignee
agrees in writing to assume Supplier’s obligations hereunder; provided, that
Supplier shall not assign its rights and obligations under this Agreement to a
competitor of Purchaser in the PET preform and container industry without the
prior written consent of Purchaser, and (ii) Purchaser may, and hereby gives
notice to Supplier that it intends to, pledge its rights and obligations under
this Agreement to its lenders as collateral to secure indebtedness outstanding
under its senior secured credit facility and all renewals, refundings,
refinancings and replacements thereof. This Agreement shall be binding upon, and
shall inure to the benefit of, the parties hereto and their respective
successors and permitted assigns. Nothing in this Agreement, express or implied,
is intended to or shall (a) confer on any person other than the parties hereto
and their respective successors or permitted assigns any rights (including third
party beneficiary rights), remedies, obligations or liabilities under or by
reason of this Agreement, or (b) constitute the parties hereto as partners or as
participants in a joint venture. This Agreement shall not provide third parties
with any remedy, claim, liability, reimbursement, cause of action or other right
in excess of those existing without reference to the terms of this Agreement.
 
7.8.    Severability.  If any term or provision of this Agreement or the
application thereof to any person or circumstance shall, to any extent, be held
invalid or unenforceable by a court of competent jurisdiction, the remainder of
this Agreement or the application of any such term or provision to persons or
circumstances other than those as to which it is held invalid or unenforceable
shall not be affected thereby, and each term and provision of this Agreement
shall be valid and enforceable to the fullest extent permitted by law. If any of
the provisions contained in this Agreement shall for any reason be held to be
excessively broad as to duration, scope, activity or subject, it shall be
construed by limiting and reducing it, so as to be valid and enforceable to the
extent compatible with the applicable law or the determination by a court of
competent jurisdiction.
 
7.9.    Counterparts.  This Agreement and any amendments hereto may be executed
in any number of counterparts, each of which shall be deemed an original
instrument, but all of which together shall constitute but one and the same
agreement. Delivery of an executed

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counterpart of a signature page to this Agreement by facsimile shall be as
effective as delivery of a manually executed counterpart of this Agreement.
 
7.10.    Section Headings; Interpretive Issues.  The section and paragraph
headings contained in this Agreement are for reference purposes only and shall
not in any way affect the meaning or interpretation of this Agreement. Supplier
and Purchaser have participated jointly in the drafting and negotiation of this
Agreement. In the event any ambiguity or question of interpretation or intent
arises, this Agreement shall be construed as if drafted jointly by Supplier and
Purchaser and no presumption or burden of proof shall arise favoring or
disfavoring any party by virtue of the authorship of any provisions of this
Agreement.
 
7.11.    Effectiveness.  The terms of this Agreement shall not become effective
until the Initial Public Offering Date.
 
7.12.    Pronouns.  Whenever the context may require, any pronouns used herein
shall be deemed also to include the corresponding neuter, masculine or feminine
forms.
 
7.13.    Further Assurances.  The parties shall execute, acknowledge and
deliver, or cause to be executed, acknowledged and delivered, such instruments
and take such other action as may be necessary or advisable to carry out their
obligations under this Agreement and under any exhibit, document or other
instrument delivered pursuant hereto.
 
7.14.    Amendment and Modification.  This Agreement may not be amended or
modified except by written instrument duly executed by the parties hereto. No
course of dealing between or among any persons having any interest in this
Agreement will be deemed effective to modify, amend or discharge any part of
this Agreement or any rights or obligations of any person under or by reason of
this Agreement.

14

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year first above written.
 
CONSTAR PLASTICS OF ITALY S.R.L.
By:
 
/s/    MASSIMILIANO MANCUSI

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Name: Massimiliano Mancusi
Title: Special Attorney

 
CROWN CORK ITALY S.P.A.
By:
 
/s/    PAOLO MINARDI

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Name: Paolo Minardi
Title: General Manager

 

15

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Schedule A
 
Existing PET Bottles and Prices
 
In EUR
Monolayer bottle cost

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PET resin
  
X
  
(assumes 1% spoilage to manufacture)
Masterbatch
  
X
  
(assumes 1% spoilage to manufacture)
Faba injection cost
  
23.38
         

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Cost to manufacture preform
  
X
    
Spoilage on blowing preform
  
X
  
(assumes 1,3% on-cost on “cost to manufacture preform”)
    

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Preform cost
  
X
    
Faba blowing cost
  
11.60
  
(=EUR 10,55 + cost of sorting bottles, EUR 1,05)
Packaging
  
2.84
         

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Ex-works price
  
X
         

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PET resin = preform weight in grammes x % PET x PET price x 1,01
Masterbatch = preform weight in grammes x % masterbatch x masterbatch price x
1,01
Spoilage on blowing preform = 1,3% on-cost on total cost of manufacturing the
preform (materials + Faba injection cost)
Packaging cost assumes that pallets are reused 5 times and layerpads twice.
NB.  In the event that Constar opts to supply monolayer preforms to Faba to be
blown, the delivered cost of those preforms replaces “cost to manufacture
preform” on the above schedule.
 
Multi-layer bottle cost

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Preform cost
  
X
  
(assumes n% spoilage)
Faba blowing cost
  
10.55
    
Packaging
  
3.75
         

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Ex-works price
  
X1
         

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Preform cost = delivered cost to Faba of multi-layer preform from Constar US
including all transport, packaging,
customs duties, insurance and related costs x (1+n/100) (where n is the observed
spoilage %)
Faba blowing cost above is based on line speeds being equal to monolayer (8,475
bottles/hour). If different
the price will be changed accordingly (8,56 x 8475/observed speed).
Packaging cost assumes that pallets are reused 5 times and layerpads twice.
 

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1
 
The price shall be reduced by Euro 0.71 when pallets compatible with Faba’s
manual fork lifts are used.

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Schedule B
 
Constar Customers
 
Ÿ
 
GUDV SA, its Affiliates and fillers acting on its behalf located in Italy

Ÿ
 
Heineken NV, its Affiliates and fillers acting on its behalf located in Europe

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Schedule C
 
Molds
 
Blow molds
 
Owned by Heineken NV Cruzcampo 1000 ml
N°11 blow inserts
N°11 bottom mould
N°11 bottom handling
N°11 external ring sectors
 
Owned by Heineken NV “Dreher 660 ml”
N°11 preforms housing rings
N°11 blow inserts
N°11 bottom mould
N°11 bottom centering ring
N°11 bottom handling
 
Owned by GUDV “Smirnoff 330 ml”
N°11 preforms housing rings
N°11 blow inserts
N°11 bottom mould
N°11 bottom centering ring
N°11 Bottom spacing
 
Owned by GUDV “Aqua 330 ml”
N°11 blow inserts
 
Injection molds
 
Owned by GUDV (Preform)
N°16 cores + tubes
N°16 cavities
N°16 cavity plates
N°16 lock rings
N°16 neck rings
N°4 neck ring plates
N°4 camme
N°16 air cooling tubes