exv10w2



 



Exhibit 10.2



TERMINAL SERVICES AGREEMENT



     THIS TERMINAL SERVICES AGREEMENT is made and entered into as of December
23, 2003 (the “Effective Date”), by and between MARTIN OPERATING PARTNERS L.P.,
a Delaware limited partnership (hereinafter referred to as “Operator”), and
MIDSTREAM FUEL SERVICE LLC, an Alabama limited liability company (hereinafter
referred to as “Customer”).


WITNESSETH:


     WHEREAS, the Operator operates several marine terminal facilities
(“Terminals”) which are identified in Attachment A; and


     WHEREAS, the Customer is in the # 2 Diesel Fuel (“Product”) distribution
business; and


     WHEREAS, it is the desire of the Operator and the Customer that the
Customer’s Product be throughput at the Terminals and that the Operator provide
unloading, handling, storage, out-loading and other terminal services with
respect to the Customer’s Product at the Terminals, all on the terms and
conditions hereinafter provided.


     NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, the Operator and the Customer agree that the Operator shall
provide the hereinafter described terminal services with respect to the
Customer’s Product at the Terminals, on the terms and conditions provided
herein:


	1.
	 	Term of Agreement. The term of this Agreement shall begin on the
Effective Date and shall end on December 31, 2006 and shall continue Month
to Month thereafter, unless terminated by either party with at least sixty
(60) days written notice prior to the end of any term.




	2.	 	Operator’s Duties. In consideration of the compensation provided in
Section 3 hereof, the Operator shall provide the following services
(“Terminal Services’) to the Customer at the Terminals:





	 	 	 
	 	(a)	Unloading. Handling and Storage Services. The Customer shall
deliver Product to these Terminals by marine vessel. The Operator
shall unload the Customer’s Product from such marine vessels in
accordance with prevailing industry standards relating to the
handling of petroleum products. The Operator shall transfer the
Product to, and store the Product in, any or all of the storage
tanks listed in Attachment B (“Storage Tanks”), all of which are
located at the Terminals.
	 	 	 
	 	 	Said Tanks shall be reserved and dedicated at all times for the
exclusive use of Customer.





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	 	(b)	Out-Loading Services. The Customer’s Product may be removed
from the Terminals by marine vessel. The Operator shall provide all
out-loading services necessary to permit the Customer to transfer
Product from the Storage Tanks to the Customer’s designated marine
vessels for removal from the Terminals.
	 	 	 
	 	(c)	Inventory Services. The Operator shall provide to the
Customer daily inventory reports of Customer’s Product, containing
reports as to receipts and withdrawals of Customer Product, and the
balance as of the close of business of the immediately preceding
day.





	3.
	 	Operator’s Compensation. For the Terminal Services performed hereunder,
the Operator shall receive the following compensation from the Customer:





	 	 	 
	 	(a)	
Throughput Fee. The Customer shall compensate the Operator
for the Terminal Services provide hereunder, in the form of a
“Throughput Fee” equal to $____  per gallon for Product out-loaded
out from these Terminals during a calendar month. The Customer
shall have a Minimum Annual Total Throughput (“Minimum”) quantity of
_____ gallons for which they shall pay the Operator this
Throughput Fee. Should Customer not meet or exceed this Minimum
then Customer shall compensate Operator for this shortfall at the
same $____ per gallon rate. The invoicing for the Minimum
shortfall (if required) will occur on the first invoice generated
immediately following each calendar year. Should this Agreement be
terminated prior to the end of any calendar year, then the Minimum
shortfall, if any, shall be determined based on a prorated
allocation of the Minimum. The Throughput Fee shall remain as
stated above until the first anniversary of the Effective Date.
Thereafter, the Throughput Fee shall be adjusted annually (both
upward and downward as hereinafter provided) by a factor equal to
the increase or decrease, as the case may be, in the Consumer Price
Index (as defined below). The adjustment shall be calculated
annually in December of each year, commencing in December, 2004.
The adjustment shall be calculated as follows: the Throughput Fee in
effect shall be multiplied by a factor equal to the amount of the
increase or decrease, as the case may be, in the Consumer Price
Index for the immediately preceding month of November, over the
Consumer Price Index for November of the preceding year. For
purposes hereof, the term “Consumer Price Index” shall mean the
“Consumer Price Index for Urban Wage Earners and Clerical Workers
(1967=100)” specified for “All Items. United States” compiled by
the Bureau of Labor Statistics of the United States Department of
Labor (the “Index”). In event the Index shall be converted to a
different standard reference base or otherwise revised, the
determination of the percentage change shall be made with the use of
such conversion factor, formula or table for converting the Index as
may be published by the Bureau of Labor Statistics or, if said
Bureau shall not publish the same, then as shall be reasonably
determined by the parties.





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	 	(b)	Miscellaneous Fees. The Customer shall reimburse the
Operator for any and all taxes, dockage or wharfage fees, product
testing charges, barge or tug charges, or any other charges which
may be levied against Operator having to do with handling and or
custody of Customer’s Product.
	 	 	 
	 	(c)	Fourchon Terminal Commission Fee Reimbursement Fee. The
Customer shall reimburse the Operator for the Commission Fees owed
by the Operator as a result of the handling of Product and water at
the terminal located at Port Fourchon, Louisiana for the Customer’s
account. This reimbursement will be a direct reimbursement of
actual fees owed by the Operator as a result of the Fuel Terminal
Services Agreement dated March 19, 1997, a copy of which is included
as Attachment C. There will be no additional handling fees or other
charges associated with the reimbursement of this fee.
	 	 	 
	 	(d)	Payment Terms. Payment of these Fees from the Customer to
the Operator shall be net 30 days from the date of the invoice.





	4.
	 	Title to Product. Title to all of the Customer’s Product received,
stored and handled by the Operator at these Terminals shall remain at all
times in the name of the Customer. The Customer agrees not to deliver for
storage at these Terminals any Product which may not be lawfully stored on
the premises of these Terminals or any Product injurious to the premises
or facilities, or which would render the facilities unfit, after cleaning,
for the proper storage of similar product, or Products.




	5.
	 	Assignment. Neither party shall assign this Agreement without the
express written consent of the other party.




	6.
	 	Facility, Tank and Equipment Condition. The Operator shall, at its sole
cost and expense, provide and maintain all handling and storage equipment
and facilities necessary to the performance of its services expressed
hereunder, including without limitation the storage tanks, in compliance
with prevailing industry standards and all applicable Laws (as defined
below) as they may exist from time to time.




	7.
	 	Customers Compliance with Laws. In the conduct of its business in the
premises of these Terminals, the Customer shall comply in all material
respects with all federal, state and local laws, ordinances, decrees,
orders, regulations, permits or other requirements having the force of law
(hereinafter, the “Laws”).




	8.
	 	Entire Agreement. This Terminal Services Agreement shall constitute the
entire agreement concerning the subject hereof between the parties
superseding all previous agreements, negotiations and representations made
prior or contemporaneous to the date hereof. This Agreement shall be
modified or amended only by written agreement executed by both parties
hereto.




	9.
	 	Controlling Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.




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     EXECUTED as of the date first set forth above.



	 	 	 	 	 
	 	 	MIDSTREAM FUEL SERVICE LLC
	 	 	 	 	 
	 	 	
By:
	 	Martin Resource Management
	 	 	 	 	Corporation, Its Sole Member






	 	 	 	 	 
	 	By:	 	/s/ Ruben S. Martin
	 	 	

	 	 	
Name:	 	Ruben S. Martin
	 	 	 	 	

	 	 	
Title:	 	Chief Executive
Officer and President
	 	 	 	 	







	 	 	 	 	 	 	 	 	 
	 	 	MARTIN OPERATING PARTNERS, LP
	 	 	 	 	 	 	 	 	 
	 	 	
By:
	 	Martin Operating GP LLC,
	 	 	 	 	its General Partner
	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:
	 	Martin Midstream Partners L.P.,
	 	 	 	 	 	 	its Sole Member
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	By:	 	Martin Midstream GP LLC,
	 	 	 	 	 	 	 	 	its General Partner







	 	 	 	 	 
	 	By:	 	 	/s/ Ruben S. Martin
	 	 	

	 	 	
Name:	 	Ruben S. Martin
	 	 	 	 	

	 	 	
Title:	 	Chief Executive Officer and President
	 	 	 	 	






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Attachment A



Terminal Services Agreement

Marine Terminal Facilities (Terminals)




	 	 	 
	1.	 	
Venice, LA
	2.	 	
Amelia, LA
	3.	 	
Berwick, LA
	4.	 	
Intracoastal City, LA
	5.	 	
Cameron (East), LA
	6.	 	
Cameron (West), LA
	7.	 	
Sabine Pass, TX
	8.	 	
Galveston, TX
	9.	 	
Freeport, TX (OOS)
	10.	 	
Freeport, TX (Tesoro)
	11.	 	
Port O’Conner, TX
	12.	 	
Aransas Pass, TX (Harbor Island)





 







 


Attachment B



Terminal Services Agreement

Storage Tank List



LOUISIANA FACILITIES




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Tank	 	 	 	 	 	Height	 	Diameter	 	Calculated	 	Nominal	 	 	 	 	 	Construction
	No.	 	Tank Age	 	(feet)	 	(feet)	 	Vol. (gal)	 	Vol. (gal)	 	Stored Product	 	Materials
	
	 	
	 	
	 	
	 	
	 	
	 	
	 	

	VENICE
	1	 	 	1969	 	 	 	30	 	 	 	35	 	 	 	215,789	 	 	 	215,000	 	 	Diesel Fuel	 	Welded Steel
	2	 	 	1969	 	 	 	24	 	 	 	25	 	 	 	84,077	 	 	 	85,000	 	 	Diesel Fuel	 	Welded Steel
	AMELIA
	1	 	 	1979	 	 	 	33	 	 	 	52	 	 	 	507,834	 	 	 	510,000	 	 	Diesel Fuel	 	Welded Steel
	3	 	 	1982	 	 	 	13	 	 	 	8	 	 	 	4,888	 	 	 	5,000	 	 	Diesel Fuel	 	Welded Steel
	BERWICK
	1	 	 	1998	 	 	 	29	 	 	 	55	 	 	 	515,104	 	 	 	515,000	 	 	Diesel Fuel	 	Welded Steel
	2	 	 	1998	 	 	 	29	 	 	 	55	 	 	 	515,104	 	 	 	515,000	 	 	Diesel Fuel	 	Welded Steel
	INTRACOASTAL CITY
	1	 	 	1981	 	 	 	32	 	 	 	60	 	 	 	676,431	 	 	 	600,000	 	 	Diesel Fuel	 	Welded Steel
	2	 	 	1981	 	 	 	32	 	 	 	60	 	 	 	676,431	 	 	 	600,000	 	 	Diesel Fuel	 	Welded Steel
	3	 	 	1981	 	 	 	32	 	 	 	60	 	 	 	676,431	 	 	 	600,000	 	 	Diesel Fuel	 	Welded Steel
	6	 	 	1978	 	 	 	16	 	 	 	8	 	 	 	6,013	 	 	 	1,000	 	 	Road Use Diesel	 	Welded Steel
	CAMERON (East)
	1	 	 	1971	 	 	 	33	 	 	 	67	 	 	 	685,430	 	 	 	685,000	 	 	Diesel Fuel	 	Welded Steel
	2	 	 	1971	 	 	 	25	 	 	 	38	 	 	 	205,682	 	 	 	205,000	 	 	Diesel Fuel	 	Welded Steel
	8	 	 	1986	 	 	 	29	 	 	 	50	 	 	 	440,022	 	 	 	441,000	 	 	Diesel Fuel	 	Welded Steel
	CAMERON (West)
	1	 	 	1979	 	 	 	87	 	 	 	40	 	 	 	630,000	 	 	 	630,000	 	 	Diesel Fuel	 	Welded Steel
	 
	TEXAS FACILITIES
	 
	SABINE PASS
	1	 	 	1978	 	 	 	32	 	 	 	60	 	 	 	674,384	 	 	 	675,000	 	 	Diesel Fuel	 	Welded Steel
	GALVESTON
	1	 	 	1976	 	 	 	40	 	 	 	30	 	 	 	211,385	 	 	 	210,000	 	 	Diesel Fuel	 	Welded Steel
	5	 	 	1982	 	 	 	48.2	 	 	 	86	 	 	 	2,103,784		 	 	2,090,000	 	 	Diesel	 	Welded Steel
	FREEPORT (OOS)
	1	 	 	1994	 	 	 	38	 	 	 	40	 	 	 	345,127	 	 	 	350,000	 	 	Diesel Fuel	 	Welded Steel
	FREEPORT (Tesoro)
	1	 	 	1984	 	 	 	24	 	 	 	30	 	 	 	126,831	 	 	 	125,000	 	 	Diesel Fuel	 	Bolted Galv. Steel
	2	 	 	1984	 	 	 	24	 	 	 	21	 	 	 	62,147	 	 	 	60,000	 	 	Diesel Fuel	 	Bolted Galv. Steel
	PORT O'CONNOR
	1	 	 	1983	 	 	 	32	 	 	 	35	 	 	 	230,175	 	 	 	230,000	 	 	Diesel Fuel	 	Welded Steel
	2	 	 	1983	 	 	 	18	 	 	 	5	 	 	 	3,000	 	 	 	3,000	 	 	Diesel Fuel	 	H - Welded Steel
	ARANSAS PASS (Harbor Island)
	1	 	 	1986	 	 	 	32	 	 	 	33.5	 	 	 	210,868	 	 	 	210,000	 	 	Diesel Fuel	 	V - Welded Steel
	2	 	 	1989	 	 	 	24	 	 	 	30	 	 	 	126,831	 	 	 	126,000	 	 	Diesel Fuel	 	V - Welded Steel
	8	 	 	1992	 	 	 	10	 	 	 	4	 	 	 	9,329	 	 	 	1,000	 	 	Diesel Fuel	 	H - Welded Steel